Here, in the deep wilderness, day after day, I hiked many miles with no one just me, the moose, wolves, bald eagles and my thoughts.
Moose Lake lodge… one of Merri’s and my favorite wilderness destinations.
These northern reaches of Canada are places of deep silence that evoke a lot of thoughts. One morning while riding a horse many miles from the lodge my mind wandered and soon I realized I was more than lost in thought. I was lost in the woods! As the eve fell I knew I was in a grave situation.
I had made most of the stupid amateur mistakes any woodsman can make, wandering for hours off the trail leaving my horse, coat, compass and matches miles away. Every protection was left behind! Thinking about investing and the beauty of the woods instead of location suddenly found me bordered by deep woods and swamp, miles from anywhere or anyone and not knowing how to get back.
What should I do… stay put, plow ahead or try to retrace my tracks? The forest had nasty quirks. There were grizzlies and just that morning the valley had erupted in mournful cries from a pack of wolves. I had a gun but only three bullets. Would shots attract my hunting partner who was miles away? Would he hear? The wind had risen. The weather was turning cold. There was a chance my shots would not be heard. Should I shoot to attract attention or save the bullets for protection during a night alone in the woods?
I decided to use the bullets to attract attention…I shot all 3 of them. It worked! My guide appeared and I slept in a soft bed that night instead of tied high up in a pine tree listening for those wolves!
That era reminded me of a lesson which is to always be aware, wary and careful. This incident can be used to help answer a question so many readers sent after the recent article about North Korean hacking being WWIV.
Many readers simply wrote “WWIV?”
Fundamentals of Global Economics
New readers often miss several basic foundations of the mindset we use at this site. One foundation is the importance of conflict in the cyclical pattern that flows through the basic fundamentals of human nature. These cycles have resulted in a series of industrial revolutions that have been directing stock markets, global economics and the world’s political and social interaction for over 1000 years.
An excerpt from the update of my report “Running Risk – How to Profit in Risky Times” may help clarifiy what I mean by WWIV and its importance to each of us in life, business and investing.
The cyclic suggestion in that article entitled WWIV is that there are struggles that create new disruptive technology. Austrian economist Joseph Shumpeter wrote about this and it is a pretty accepted line of economics that disruption derived from war enhances productivity when it is moved from the military to the domestic realm.
To grasp this dilemma, let’s think about the history of modern society. Several hundred years ago Europe was dominated by a feudal political system. The economy was powered by agriculture based on manpower and domesticated livestock. The limiting velocity of man, of his thoughts, ideas and commerce was the speed of a horse. Fate, current and wind ruled marine travel.
Then in desperation over manpower shortages caused by a series of plagues, humanity took an economic evolutionary turn. We made a giant step forward with new ideas about mechanical power. These ideas gave rise to incredible inventions such as the steam engine and telegraph.
We have moved thru seven industrial eras. The first era was feudal dominated by the stirrup and the Holy Roman Empire.
Then came five eras best described by Joseph Schumpeter, on how innovation creates industrial revolutions altering the way we live, work, earn and keep money. He described five great economic eras that began in the late 1700s:
Era #1: 1785-1845-fueled by water power-60 years. Textiles and iron works were the backbone of growth industries.
Era #2: 1845-1900-fueled by steam-55 years. Railways and steel provided the main growth in this era.
Era #3: 1900-1950-fueled by the internal engine-50 years. Electricity and chemicals provided the major growth.
Era #4: 1950-1990-fueled by electronics-40 years. Petrochemicals and aviation were the innovations which became mainstream in this period.
Era #5: 1990-current-fueled by digital networks- 30 years+ ? Software and new media create the growth elements in this era.
We are now moving into a new era called the Imagination Era bringing with it changes that may help resolve the many negative issues our global society faces now.
Each era greatly empowered massive new numbers of individuals, an empowerment that led to entire new classes. The working middle-class was born. This empowerment allowed the working class to rise from feudal subservient positions to positions of economic and hence political influence.
Much of the world’s population became much richer, but these changes were accompanied by turmoil caused by periods when the old order had not let go and the new order had not taken hold. Many forces came into play and there were struggles for dominance to establish order.
Forms of this turmoil were WWI, the massive economic recession of the 1930s, WWII and the Cold War. Wars and recession are signals that the economic-social structural order is breaking down, but that a new order has not yet taken control.
Serious things go wrong. Such breakdowns lead to enormous conflicts that we call wars. Major wars accompany great social, political and industrial change and bring out the most competitive aspects of society. This speeds up change. The key is that the struggle is so intense and the stakes so high that all concepts of return on investment for research and development are thrown out the window.
How can we know what’s next?
Cycles in the Dow at Stockcharts.com (see link below).
These cycles are one part of a compass to global economics that can help each of us determine our unique path of living, earning and investing.
This chart shows the relationship between a falling market… faltering economy and intense military struggles that create disruptive technology leading to increased productivity in mankind.
The question we have been asking at our site for several years is… what will cause WWIV?
This is one of many factors. The Dow for example has decreased in importance as a global economic bellwether. The NASADAQ investments for example became increasingly important in the 1990 to 2000 dot.com climb.
The US has also lost much importance in the global economy. Synchronicity between US and other markets need extra understanding now.
However the charts below of the Dow Jones Industrial and Morgan Stanley MSCI World Index suggest there is still a very strong correlation.
Dow Jones Industrial Index 2005 – 2013.
Morgan Stanley Capital Index World Index 2005 – 2103.
Currency changes need to be accounted for.
This mobile scenario is then overlaid by the never ending search for value.
Most important the way every individual’s circumstances, wants, needs, desires and mission are the keys that fit a unique piece into this global puzzle.
To sum up the global fundamentals, two gigantic forces struggle one against the other. The positive forces include added efficiency from shifting into a computer driven industrial revolution, which is opening a global economy. Individuals are empowered to be more, be in more places, do more, make more and have more.
The negative force is the resistance, congestion, and pollution to and from this change. Evolution takes place unequally and creates distortions. As these distortions grow, the risks of a correction global rise. The growing tensions are revealed in commerce and the rapidly changing art of war.
Man has always run risk. Change brings risk. Today we face change taking place at a faster and faster pace. This means we run an increased risk. The fundamentals explained above help us see how to profit from running risk.
Investing Beyond the BoomWarren Buffet once warned against the Cinderella effect.
He said “Don’t be fooled by that Cinderella feeling you get from great returns. Nothing sedates rationality like large doses of effortless money. After a heady experience of that kind, normally sensible people drift into behavior akin to that of Cinderella at the ball. They know the party must end but nevertheless hate to miss a single minute of what is one helluva party. Therefore, the giddy participants all plan to leave just seconds before midnight. There’s a problem, though: They are dancing in a room in which the clocks have no hands.”
Cinderella may have lost a shoe when she fled the party to meet a midnight curfew. We can lose much more when we rush from a crashing stock market.
Most investors face emotional dangers that build in rising markets.
Almost everyone feels good.
But the clock of economic reckoning is ticking.
No wants to see it. Nothing rises forever and especially… not everything at the same time.
Yet no one wants to leave the party until the end.
But many edge closer to the door.
When the clock chimes there could be a stampede even though leaving in a hurry may be the worst way to go.
Here are seven steps that can help avoid this risk.
- Choose investments based on markets instead of shares.
- Diversify based on value.
- Rely on financial information rather than economic news.
- Keep investing simple.
- Keep investing costs low.
- Trade as little as possible.
- Make the decision process during panics automatic.
One strategy is to invest in country ETFs that easily provide diversified, risk-controlled investments in countries with stock markets of good value. These ETFs provide an easy, simple and effective approach to zeroing in on value. Little management and less guesswork is required. The expense ratios for most ETFs are lower than those of the average mutual funds. Plus a single country ETF provides diversification equal to investing in dozens, even hundreds of shares.
A minimum of knowledge, time, management or guesswork are required.
The importance of…
Keeping investing simple is one of the most valuable, but least looked at, ways to avoid disaster. Simple and easy investing saves time. How much is your time worth? Simple investing costs less and avoids fast decisions during stressful times in complex situations where we are most likely to get it wrong.
Fear, regret and greed are an investor’s chief problem. Human nature causes investors to sell winners too soon, and hold losers too long.
Easy to use, low cost, mathematically based habits and routines help protect against negative emotions and impulse investing.
Take control of your investing. Make decisions based on data and discipline, not gut feelings. The Purposeful investing Course (Pi) teaches math based, low cost ways to diversify in good value markets and in ETFs that cover these markets. This course is based on my 50 years of investing experience combined with wisdom gained from some of the world’s best investment managers and economic mathematical scientists.
Enjoy Repeated Wealth With Pi
Pi’s mission is to make it easy for anyone to have a strategy and tactics that continually maintain safety and turn market turmoil into extra profit.
One secret is to invest with a purpose beyond the immediate returns. This helps create faith in a strategy that adds stickiness to the plan.
Another tactic is to invest with enough staying power so you’re never caught short.
Never have to sell depressed assets during periods of loss.
Lessons from Pi are based on the creation and management of Model Portfolios, called Pifolios.
The success of Pifolios is based on ignoring economic news (often created by someone with vested interests) and using financial math that reveals deeper economic truths.
One Pifolio covers all the good value developed markets. Another covers the emerging good value markets.
The Pifolio analysis begins with a continual research of 46 major stock markets that compares their value based on:
#1: Current book to price
#2: Cash flow to price
#3: Earnings to price
#4: Average dividend yield
#5: Return on equity
#6: Cash flow return.
#7: Market history
This is a complete and continual study of almost all the developed major and emerging stock markets.
This mathematical analysis forms the basis of a Good Value Stock Market Strategy. The analysis is rational, mathematical and does not worry about short term ups and downs.
This strategy is easy for anyone to follow and use. Pi reveals the best value markets and provides contacts to managers and analysts and Country Index ETFs so almost anyone can create and follow their own strategy.
Learn how to invest like a pro from the inside out.
At the beginning of 2019 my personal Pifolio is based on select ETFs in the Keppler Developed and Emerging markets. My Pifolio is invested in Country ETFs that cover seven developed and three emerging markets:
Don’t give up profit to gain ease and safety!
Regardless of economic news, these markets represent good value and have been chosen based on four pillars of valuation.
- Absolute Valuation
- Relative Valuation
- Current versus Historic Valuation
- Current Relative versus Relative Historic Valuation
When you subscribe to Pi, you immediately receive a 120 page basic training course that teaches the Pi Strategy. You learn all the Pi strategies, what they are, how to use them and what each can do for you, your lifestyle and investing.
You also begin receiving regular emailed Pifiolio updates and online access to all the Pifolio updates of the last two years. Each update examines the current activity in a Pifolio, how it is changing, why and how the changes might help your investing or not.
Included in the basic training is an additional 120 page PDF value analysis of 46 stock markets (23 developed markets and 23 emerging stock markets). This analysis looks at the price to book, price to earnings, average yield and much more.
You also receive two special reports.
In the 1980s, a remarkable set of two economic circumstances helped anyone who spotted them become remarkably rich. Some of my readers made enough to retire. Others picked up 50% currency gains. Then the cycle ended. Warren Buffett explained the importance of this ending in a 1999 Fortune magazine interview. He said: Let me summarize what I’ve been saying about the stock market: I think it’s very hard to come up with a persuasive case that equities will over the next 17 years perform anything like—anything like—they’ve performed in the past 17!
I did well then, but always thought, “I should have invested more!” Now those circumstances have come together and I am investing in them again.
The circumstances that created fortunes 30 years ago were an overvalued US market (compared to global markets) and an overvalued US dollar. The two conditions are in place again!
30 years ago, the US dollar rose along with Wall Street. Profits came quickly over three years. Then the dollar dropped like a stone, by 51% in just two years. A repeat of this pattern is growing and could create up to 50% extra profit if we start using strong dollars to accumulate good value stock market ETFs in other currencies.
This is the most exciting opportunity I have seen since we started sending our reports on international investing ideas more than three decades ago. The trends are so clear that I have created a short, but powerful report “Three Currency Patterns for 50% Profits or More.” This report shows how to earn an extra 50% from currency shifts with even small investments. I kept the report short and simple, but included links to 153 pages of Good Value Stock Market research and Asset Allocation Analysis.
The report shows 20 good value investments and a really powerful tactic that shows the most effective and least expensive way to accumulate these bargains in large or even very small amounts (less than $5,000). There is extra profit potential of at least 50% so the report is worth a lot.
This report sells for $29.95 but in this special offer, you receive the report, “Three Currency Patterns for 50% Profits or More” FREE when you subscribe to Pi.
Plus get the $39.95 report “The Silver Dip” free.
With investors watching global stock markets bounce up and down, many missed two really important profit generating events over the last two years. The price of silver dipped below $14 an ounce as did shares of the iShares Silver ETF (SLV). The second event is that the silver gold ratio hit 80, compared to a ratio of 230 only two years before.
In September 2015, I prepared a special report “Silver Dip 2015” about a silver speculation, leveraged with a British pound loan, that could increase the returns in a safe portfolio by as much as eight times. The tactics described in that report generated 62.48% profit in just nine months.
I have updated this report and added how to use the Silver Dip Strategy with platinum. The “Silver Dip” report shares the latest in a series of long term lessons gained through 40 years of speculating and investing in precious metals. I released the 2015 report, when the gold silver ratio slipped to 80. The ratio has corrected and that profit has been taken and now a new precious metals dip has emerged.
I have prepared a new special report “Silver Dip” about a leveraged speculation that can increase the returns in a safe portfolio by as much as eight times.
You also learn from the Value Investing Seminar, our premier course, that we have been conducting for over 30 years. Tens of thousands of delegates have paid up to $999 to attend. Now you can join the seminar online FREE in this special offer.
This three day course is available in sessions that are 10 to 20 minutes long for easy, convenient learning. You can listen to each session any time and as often as you desire.
The sooner you hear what I have to say about current markets, the better you’ll be able to cash in on perhaps the best investing opportunity since 1982.
Tens of thousands have paid up to $999 to attend.
This year I celebrated my 52nd anniversary of writing about global investing. Our reports and seminars have helped readers have better lives, with less stress yet make fortunes during up and down markets for decades. This information is invaluable to investors large and small because even small amounts can easily be invested in the good value shares we cover in our seminar.
Stock and currency markets are cyclical. These cycles create extra profit for value investors who invest when everyone else has the markets wrong. One special seminar session looks at how to spot value from cycles. Stocks rise from the cycle of war, productivity and demographics. Cycles create recurring profits. Economies and stock markets cycle up and down around every 15 to 20 years as shown in this graph.
The effect of war cycles on the US Stock Market since 1906.
Bull and bear cycles are based on cycles of human interaction, war, technology and productivity. Economic downturns can create war.
The chart above shows the war – stock market cycle. Military struggles (like the Civil War, WWI, WWII and the Cold War: WW III) super charge inventiveness that creates new forms of productivity…the steam engine, the internal combustion engine, production line processes, jet engines, TV, farming techniques, plastics, telephone, computer and lastly during the Cold War, the internet. The military technology shifts to domestic use. A boom is created that leads to excess. Excess leads to correction. Correction creates an economic downturn and again to war.
Details in the online seminar include:
* How to easily buy global currencies, shares and bonds.
* Trading down and the benefits of investing in real estate in Small Town USA. We will share why this breakout value is special and why we have been recommending good value real estate in this area since 2009.
* What’s up with gold and silver? One session looks at my current position on gold and silver and asset protection. We review the state of the precious metal markets and potential problems ahead for US dollars. Learn how low interest rates eliminate opportunity costs of diversification in precious metals and foreign currencies.
* How to improve safety and increase profit with leverage and staying power. The seminar reveals Warren Buffett’s value investing strategy from research published at Yale University’s website. This research shows that the stocks Buffet chooses are safe (with low beta and low volatility), cheap (value stocks with low price-to-book ratios), and high quality (stocks of companies that are profitable, stable, growing, and with high payout ratios). His big, extra profits come from leverage and staying power. At times Buffet’s portfolio, as all value portfolios, has fallen, but he has been willing and able to wait long periods for the value to reveal itself and prices to recover.
Use time not timing.
Time is your friend when you use a good value strategy. The longer you can hold onto a well balanced good value portfolio, the better the odds of outstanding success.
A 45 year portfolio study shows that holding a diversified good value portfolio (based on a good value strategy) for 13 month’s time, increases the probability of out performance to 70%. However those who can hold the portfolio for five years gain a 88% probability of beating the bellwether in the market and after ten years the probability increases to 97.5%.
Learn how much leverage to use. Leverage is like medicine, the key is dose. The best ratio is normally 1.6 to 1. We’ll sum up the strategy; how to leverage cheap, safe, quality stocks and for what period of time based on the times and each individual’s circumstances.
Learn to plan in a way so you never run out of money. The seminar also has a session on the importance of having and sticking to a plan. See how success is dependent on conviction, wherewithal, and skill to operate with leverage and significant risk. Learn a three point strategy based on my 50 years of investing experience combined with wisdom gained from some of the world’s best investment managers and economic mathematical scientists.
The online seminar also reveals the results of a $80,000 share purchase cost test that found the least expensive way to invest in good value. The keys to this portfolio are good value, low cost, minimal fuss and bother. Plus a great savings of time. Trading is minimal, usually not more than one or two shares are bought or sold in a year. I wanted to find the very least expensive way to create and hold this portfolio so I performed this test.
I have good news about the cost of the seminar as well. For almost three decades the seminar fee has been $799 for one or $999 for a couple. Tens of thousands paid this price, but online the seminar is $297.
In this special offer, you can get this online seminar FREE when you subscribe to our Personal investing Course.
Save $468.90 If You Act Now
Subscribe to the first year of The Personal investing Course (Pi). The annual fee is $299, but to introduce you to this online, course that is based on real time investing, I am knocking $102 off the subscription. Plus you receive FREE the $29.95 report “Three Currency Patterns for 50% Profits or More”, the $39.95 report “Silver Dip” and our latest $297 online seminar for a total savings of $468.90.
Enroll in Pi. Get the basic training, the 46 market value report, access to all the updates of the past two years, the two reports and the Value Investing Seminar right away.
#1: I guarantee you’ll learn ideas about investing that are unique and can reduce stress as they help you enhance your profits through slow, worry free, easy diversified investing.
If you are not totally happy, simply let me know.
#2: I guarantee you can cancel your subscription within 60 days and I’ll refund your subscription fee in full, no questions asked.
#3: You can keep the two reports and Value Investing Seminar as my thanks for trying.
You have nothing to lose except the fear. You gain the ultimate form of financial security as you reduce risk and increase profit potential.
Subscribe to Pi now, get the 130 page basic training, the 120 page 46 market value analysis, access to over 100 previous Pifolio updates, the “Silver Dip” and “Three Currency Patterns For 50% Profits or More” reports, and value investment seminar, plus begin receiving regular Pifolio updates throughout the year.
Subscribe to a Pi annual subscription for $197 and receive all the above.
Your subscription will be charged $299 a year from now, but you can cancel at any time.
See great stock charts at stockcharts.com/freecharts/historical/djia1900.html