Netflix’s Stranger Things was by far the most ‘in-demand’ digital original in Spain in the week commencing December 11, according to Parrot Analytics’ latest data on the market.Stanger ThingsHowever, it was Netflix that was the big winner in the week December 11-17, with every digital original listed in Parrot’s top 10 poll hailing from the subscription video-on-demand giant.Stranger Things has topped Parrot’s list in markets including Denmark, the UAE and South Africa in recent months and garnered 10.87 million in-demand expressions in the Spanish market.This placed it far ahead of second-place Dark, another Netflix Original, which averaged 3.93 million demand expressions in Spain. The supernatural thriller series is Netflix’s first German-language original and went live on the service earlier this month.The number three slot on the Spanish list was taken by The Crown with 3.52 million demand expressions. Narcos, came in at number four and was the highest-ranking Spanish-language production on the list.The other titles in the top 10 were Marvel’s The Punisher, Las Chicas Del Cable, Black Mirror, Orange is the New Black, Marvel’s the Defenders and Sens8.Parrot Analytics analyses the demand for recent popular digital titles across international markets based on the application of artificial intelligence to expressions of demand across social media, fan sites, peer-to-peer protocols and file-sharing platforms.
Pay TV revenues are set to grow in the Middle East and North Africa (MENA) between 2017 and 2023 but at a lower rate than subscription numbers, according to Digital TV Research.The Middle East and North Africa Pay TV Forecasts report said the figures indicate that average revenues per user (ARPU) must be falling in the region.Across the 13 Arab-speaking countries in the region, the research estimates that pay TV revenues will grow by 24% from US$1.18 billion in 2017 to US$1.46 billion in 2023 – despite pay TV subscriptions rising by 47% over the same period to 5.84 million.Digital TV Research principal analyst, Simon Murray, said that the MENA region “has always been difficult for pay TV” due to rampant piracy and many homes receiving free-to-air channels.However, he added that beIN is “shaking up the market” by taking on long-established rival OSN with a strong slate of exclusive sports rights and more entertainment content.While OSN has exclusive long-term deals with all the Hollywood studios it has struggled to push much beyond one million subscribers, according to the study, which estimates that beIN will overtake OSN by subscriber numbers in 2018 and by revenues in 2022. “Competition is increasing – not only from beIN, but also from the multitude of SVOD platforms that have launched in recent years,” said Murray. “These platforms compete more directly against OSN than beIN due to their emphasis on drama. No SVOD platforms can compete against beIN with live sports provision.”“OSN’s reaction was to cut its subscription prices substantially in February 2017. Digital TV Research believes that further cuts will be made as OSN struggles to hold on to its subscriber base until its fees are just above beIN’s.”Digital TV Research predicts that OSN’s revenues will be US$498 million in 2023 – down from US$700 million in 2015. It expects beIN’s revenues to double between 2016 and 2023. By 2023, beIN is forecast to have 1.87 million satellite TV subscribers, compared to OSN’s 1.46 million.Overall, across the 20 countries covered in the MENA report, Digital TV Research predicts that pay TV revenues will fall in 2018 and be flat in 2018, before starting a “slow recovery”. In 2023 it expects revenues to reach US$3.62 billion – up 7.8% compared to 2017.In Israel it expects pay TV revenues to fall from more than US$1 billion in 2015 to US$767 million in 2023 as cheaper OTT platforms force traditional pay TV operators to lower their fees.
Satellite operators Intelsat and Telenor Satellite have agreed to extend their partnership at the 1° West orbital slot.Intelsat has taken additional capacity on the Thor 5 and Thor 7 satellites, providing it with space to grow its DTH business in central and eastern Europe.Intelsat said that the agreement would enable it to support the growth of its media customers bringing content to and from the region as well as enhance access to Intelsat’s own DTH platform at 1° West.The orbital slot serves over 2.2 million DTH households in Romania, Hungary, the Czech Republic and Slovakia.“The agreement with Intelsat is core to our broadcast household reach within Central and Eastern Europe and it is essential in order to continue the positive development in the region. We have a strong and positive commercial relationship with Intelsat, which we look forward to proceed,” said Ole Ledang, Director of the Broadcasting Division of Telenor Satellite.“The 1º West neighborhood delivers significant advantages to broadcasters who are looking to expand their channel distribution in this fast -growing market,” says Rob Cerbone, Intelsat’s Vice President and General Manager, Media, stated, “Through our partnership with Telenor, we are able to meet our customers’ increasing broadcast demands, facilitate their growth objectives and provide them with quick, cost-efficient access to DTH and cable systems in Central and Eastern Europe.”
Sixty programmes received £184 million in High-End Television Tax Relief (HTR) in 2017-18, according to UK government stats.In total, HTR was paid to 180 claims, with each show able to make several claims during the production process.The government said that the 60 shows accounted for UK expenditure of £612 million (€685 million).Since HTR was introduced in 2013, some 310 programmes – including BBC drama the Peaky Blinders – have made claims, accounting for £2.4 billion of UK expenditure and £3.2 billion of total expenditure, said the government. This resulted in 535 individual claims and a total of £563 million being paid out.Separately, there were 15 children’s television programmes completed in the UK in 2017-18 that claimed Children’s Television Tax Relief (CTR), with UK expenditure of £24 million.In the past year, £13 million of CTR was paid to 50 claims. A total of £18 million has been paid out in response to 85 claims for CTR since the introduction of the relief in April 2015.High-end television, as defined by the government, is programming that costs £1 million per hour to produce on average and has a slot length that is greater than 30-minutes. HTR was announced in 2012 and introduced on April 1, 2013.HTR allows qualifying companies to claim a deduction in their taxable profits or, where that deduction results in a loss, to surrender the tax relief for a payable tax credit.
The BBC has introduced ‘last chance’ mobile notifications for its iPlayer catch-up service, notifying users when they only have a few days left to watch downloaded content.The BBC lets iPlayer users download content to watch on the move, but that content is only accessible for the same amount of time that it is hosted on the iPlayer website or app – often for 30 days after its original TV broadcast.“Downloads are a great way to watch on the move, when commuting, or while you’re abroad, but it can be very frustrating if you forget that a download is about to expire and only realise once it’s too late,” said head of BBC iPlayer, Dan Taylor-Watt.“We’re reinventing BBC iPlayer for a new generation, with more personalised features, more box sets and UHD HDR content. We hope these new ‘last chance’ notifications will add to this, improving people’s experience of using the app and help to ensure that no-one misses out on watching their favourite BBC shows.”
UK competition watchdog the Competition and Markets Authority has cleared the acquisition of Ebiquity’s advertising intelligence unit.The CMA said that the deal, which was announced in February, could be cleared on the ground that two companies did not closely compete.Nielsen agreed to acquire the unit, which comprises a portfolio advertising monitoring platform, ePublisher validation and verification platform and communications insight services operating in Australia, Germany, the UK and the US, in order to further its strategy for broader total audience measurement and to reduce its reliance on third-party solutions.Following an in-depth investigation, the watchdog said that, although Nielsen and Ebiquity sell advertising intelligence products to UK and international customers, the design of their products, how they are used, and the fact that very few customers switch between the companies meant that the deal could be greenlit.The regulator also said that its assessment had taken into account changes in the advertising landscape, and in particular the growth of online advertising, which had put pressure on two companies that provide intelligence on traditional media.Ebiquity’s shares fell sharply following the CMA announcement when the company issued a current-year profit warning on a slowdown in in the ad intelligence business as well as a poor performance in the US digital analytics business.
The parade will be followed by a world class fireworks display on the Foyle from 8.15 pm.Looking ahead to the event, which has now gained international status, the Mayor of Derry City and Strabane District, Councillor Maolíosa McHugh, said: “This weekend the festivities will be in full swing, with four days of family activities taking place across the district.“As the city prepares to submit its bid for the title of European Capital of Culture alongside Belfast, what better way to showcase our ability to host and develop international quality events which appeal to a global audience.“As we celebrate the culture that sets us apart from the rest of the world over the coming days I would encourage everyone to back our bid for ECOC2023. DERRY is gearing up for another spectacular Hallowe’en extravaganza, and with tens of thousands expected in the city to enjoy the celebrations next Tuesday, October 31 the public is being advised there may be some disruptions to travel in and around the city centre.A number of car park and road closures will be put in place to ensure public safety and viewing of the main carnival parade, which this year will have an extended route beginning from 7pm.The parade has a distinctly lunar theme as the crowds gather to Release the Samhain Moon, with performers leaving from Council’s Car Park on Queen’s Quay before the parade will move along Boating Club Lane to the Strand Road.From here it will proceed along the Strand Road to Harbour Square Roundabout before progressing right along the Foyle Embankment to Water Street, returning back towards the Quay, finishing at the Council car park at approximately 8.15 pm. ADVICE ISSUED AHEAD OF HALLOWE’EN CELEBRATIONS IN DERRY ShareTweet “With so many people expected here, especially on October 31, I would also urge people to plan ahead of their visit to ensure their journey is stress free and that they are aware of all the guidance in terms of road closures and parking.“Let’s make this a Hallowe’en to remember.”Events co-ordinator with Derry City and Strabane District Council, Liz Cunningham, advised people to check out the Council’s website in order to ensure the very best Halloween experience.“Anyone planning to attend the festivities should check out the traffic and travel information online and should pay attention to the directions of stewards and the PSNI on the night,” she stressed.“We would ask that everyone adheres to the advice being given, and where possible to avoid parking in the city centre and to allow a bit of extra time for their journey. We hope that everyone has a very safe and a very happy Hallowe’en.”Motorists should note that Queen’s Quay will be closed to traffic from 6pm until 8.30pm (slightly earlier than previous years) and that Queen’s Quay and Foyle Street Car Parks will be closed all day. Strand Road Car Park will be open for Accessible Parking only.There will be no access to Quayside or Victoria Market Car parks from 6pm until 8.30pm to facilitate the passing of the parade, but both will remain open prior to and following the parade and fireworks.Car parking will be available at major car parks such as Foyleside Shopping Centre, Quayside Shopping Centre, William Street Car Park and at the Fort George, Foyle Arena and Oakgrove primary school.Further traffic diversions will be in place in and around the city centre, therefore where possible avoid driving to the city centre, opt to park and stride where possible, and allow a little extra time for your journey.Park and stride facilities are available at Fort George, North West Regional College and Magee University.The Peace Bridge will also be closed from 7.15pm until 8.40pm. Once the event has ended, Peace Bridge and road access should be returned to normal fairly quickly.Anyone hoping to enjoy a good view of the fireworks should note that Queen’s Quay will provide the ideal spot.There will also be an accessible viewing area for people with impaired mobility located on the Queen’s Quay opposite the City Hotel and in the Strand Road Car Park.Anyone who wishes to avail of this area should arrive a little earlier in order to ensure unimpeded access before the surrounding areas become heavily crowded.Derry City and Strabane District Council have introduced a point of contact to the Carnival for Access and Inclusion making the event more accessible and inclusive to all.This will include additions to the provisions from previous years such as a quiet room available on the 31st October at the Guildhall and North West Regional College, Strand Building.Should anyone require details in regards to access and inclusion for this event please contact Louise Boyce via email at firstname.lastname@example.org or telephone 028 7125 3253, ext 4349. Information is also available at www.derrystrabane.com/inclusion.Translink have confirmed that there will be some disruption to their services around any road closures.Translink bus information can be found at www.translink.co.uk/Routes-and-Timetables.Further updates to travel arrangements will be made available via local radio stations such as Radio Foyle, Q102, Downtown and Cool FM throughout the day.Further details on Derry City and Strabane District Council’s Hallowe’en Celebrations and Strabane’s traffic arrangements can be found at www.derryhalloween.com/trafficADVICE ISSUED AHEAD OF HALLOWE’EN CELEBRATIONS IN DERRY was last modified: October 26th, 2017 by John2John2 Tags:
“This report shows us that more needs to be done to tackle climate change and I would call for specific targets to be set for the island of Ireland, which are realistic, attainable and worthwhile for tackling climate change.“Perhaps the greatest challenge facing the global community is climate change.“This is no longer a story of floods and catastrophe in faraway lands. Climate change is with us.“In Derry and across the North West we need to make sure that we are all doing our bit to tackle climate change. SINN Féin spokesperson on energy, environment and climate change Councillor Sandra Duffy has reiterated Mary Lou McDonald’s call for action on climate change.She said: “Climate change is not only a massive issue for the island of Ireland but also the whole world, it is not something that we can solve on our own.“A recent report publicised by the Atmospheric Chemistry and Physics Journal claims that the Ozone layer is thinning and not recovering over highly populated areas.“This has the potential to expose billions of people to harmful ultraviolet rays, linked to causing cancer. COUNCILLOR SANDRA DUFFYDerryENERGY AND CLIMATE CHANGESinn FeinWE ALL NEED TO DO OUR BIT TO TACKLE CLIMATE CHANGE – DUFFY ShareTweet “We need to plan, to act, to set targets and meet targets,” added Cllr Duffy.WE ALL NEED TO DO OUR BIT TO TACKLE CLIMATE CHANGE – DUFFY was last modified: February 18th, 2018 by John2John2 Tags:
Mayor of Derry and Strabane Michaela BoyleMAYOR of Derry City and Strabane District Council, Councillor Michaela Boyle, has officially announced the identity of the new Co-Delivery Design group who have been appointed to oversee the implementation of its new Arts and Culture Strategy (2019-2024) for the City and District.The strategy will complement Council’s recently released Tourism Strategy and Integrated Economic Development Strategy, bringing the development of Council services in line with the outcomes identified within the Strategic Growth Plan for the area. “The strategy is another strand of the comprehensive and ambitious vision for the City and District through the over-arching Strategic Growth Plan and aims to enhance wellbeing through accessible cultural experiences and the arts.“I am sure the unique and industry specific skills that the group members have will allow them to make a significant impact on the delivery of this visionary new strategy.”In addition to inviting relevant statutory and support agencies this advisory group will include Derry City and Strabane District Council elected Members on a cross party basis as well as Council Officers. The group will meet four times per annum as well as deliver an open annual meeting to review the strategy, discuss progress and consider ongoing process implementation. The full list of selected nominees are: Cath McBride, Eibhlín Ní Dhochartaigh, Stephen Batts, Catherine Hemelryk, Edel MacBride, Lisa Heaney, Derek Moore, Rachel Melaugh, Fiona Umetsu, Pauline Gardiner, Anne McMaster, James Kee and Tommy Barr.To find out more about the Arts and Strategy and the Co-Delivery group visit www.derrystrabane.com/artsandcultureMayor officially announces Arts and Culture Strategy Design Group was last modified: July 4th, 2019 by John2John2 Tags: Derry and Strabane CouncilIntegrated Economic Development StrategyMayor Michaela BoyleMayor officially announces Arts and Culture Strategy Design GroupTourism Strategy The group will oversee the delivery of a strategy with members having specific responsibility for one of six aims.The aims are to engage citizens and grow audiences, deliver a high quality arts programme, implement an effective and ambitious marketing campaign, invest in the potential of our creative sector, strengthening the cultural infrastructure of the region while growing employment opportunities and demonstrate and communicate the difference that our community makes.Mayor Boyle thanked the group members for their input and wished them well as they begin the process of delivery and implementation of the strategy.“Congratulations to the Co-Delivery Design group on their appointment and the very best of luck to them in the area of the Arts and Culture Strategy they have been selected to oversee,” she said. ShareTweet
Mail Local NewsNewsTop Stories Rural King Comes To Crossroads Mall By Terell BaileyMar 03, 2018, 18:14 pm 1028 0 Home NewsWatch Local News Rural King Comes To Crossroads Mall Terell Bailey Bio Coming Soon Facebook Twitter Previous PostW.V. Senate Passes 4% Pay Raise Bill, Not 5% Mt. Hope., WV (WOAY) – Crossroads Mall has received a new anchor store.Saturday morning after months of construction the Rural King opened. This is the 109 store in the company and it’s located at Crossroads Mall replacing the old Sears.The store offers a range of things from livestock to clothing items. Free popcorn and coffee are offered to all guest who enter the store. On the week of March 11th the store will be hosting several grand opening events.Store hours of operation are 7 a.m. to 9 p.m. Monday through Sunday. Leave a Reply Cancel reply Your email address will not be published. Required fields are marked *Comment Name * Email * Website Linkedin Tumblr Google+ Next PostUPDATE: An Amendment To Lower Pay Raise Bill To 4% Passes Senate Finance Committee Pinterest
Tyler Barker Tyler Barker is currently the Interim News Director and Digital Content Manager for WOAY-TV. I was promoted to this job in Mid-November. I still will fill in on weather from time to time. Follow me on Facebook and Twitter @wxtylerb. Have any news tips or weather questions? Email me at email@example.com Tumblr Google+ Leave a Reply Cancel reply Your email address will not be published. Required fields are marked *Comment Name * Email * Website Next PostVIDEO – FIRST ON WOAY: Body Found In Beckley Twitter Linkedin Local NewsNewsWatchTop Stories Tractor-Trailer Accident Causing A Significant Gas Leak Shuts Down Parts Of I-64 Near Lewisburg By Tyler BarkerJun 06, 2018, 23:04 pm 727 0 Pinterest Facebook GREENBRIER COUNTY, WV (WOAY) – Emergency crews rushed to the scene of a tractor-trailer accident along I-64.Officials tell WOAY that the call came in at 10:08 pm on I -64 westbound near mile marker 170. Right now, one westbound lane is closed.A significant amount of gas is leaking from the tractor-trailer and people are advised to find an alternate route.Minor injuries have occurred due to the accident.Greenbrier County Sheriff’s Department, Lewisburg Fire, Fairlea Fire, Greenbrier Ambulance, White Sulphur Springs Ambulance and Greenbrier Homeland Security and Emergency Management Responded to the scene. Home NewsWatch Local News Tractor-Trailer Accident Causing A Significant Gas Leak Shuts Down Parts Of I-64 Near Lewisburg Previous PostMiners Extend Win Streak to Four Games Mail
Pinterest Linkedin COLUMBUS, Ohio (AP) — Democratic presidential candidate Joe Biden declared Saturday that the Equality Act would be his top legislative priority, an effort to enshrine LGBTQ protections into the nation’s labor and civil rights laws.The former vice president shared his hopes of signing the legislation as part of a keynote address to hundreds of activists at the Human Rights Campaign’s annual Ohio gala on the first day of Pride Month. In a half-hour at the lectern, his remarks ranged from emotional tributes to his audience and their personal endurance to condemnations of President Donald Trump.“It’s wrong and it is immoral what they’re doing,” Biden said of the Trump administration. Among other Trump polices, he cited attempts to bar transgender troops in the U.S. military, allow individuals in the medical field to refuse to treat LGBTQ individuals, and allow homeless shelters to refuse transgender occupants.“Just like with racial justice and women’s rights, we are seeing pushback against all the progress we’ve made toward equality,” Biden said.The Equality Act would address many such discriminatory practices. It recently passed the Democratic-run House, but will not become law under Trump and the Republican Senate. That means LGBTQ residents in dozens of states are still subject to various forms of discrimination that are either specifically allowed or not barred by state law.“It will be the first thing I ask to be done,” Biden said.Biden spoke in Ohio, a political battleground he was visiting for the first time since beginning his bid, on the same day that more than a dozen of his rivals were in San Francisco for the California Democratic Convention and a massive MoveOn.org conference. By the end of the weekend, 14 candidates will have addressed thousands of activists in California, which has more than 400 delegates to the 2020 convention, about a fifth of what it will take to win the nomination.Among them, Massachusetts Sen. Elizabeth Warren and Mayor Pete Buttigieg of South Bend, Indiana, nodded to Biden’s absence with subtle jabs.“Some Democrats in Washington believe the only changes we can get are tweaks and nudges. … Some say if we all just calm down, the Republicans will come to their senses,” Warren said, an allusion to Biden’s recent prediction that Republicans will have “an epiphany” once Trump leaves office.Biden made no mention of his rivals, with his go-it-alone itinerary and his message signifying his burgeoning confidence at his position atop the pack of 24 presidential hopefuls.Campaigning in a Midwest battleground is no surprise for Biden. One of the prevailing arguments for his candidacy is that his moderate, deal-making, “Middle Class Joe” brand offers Democrats their best shot to win back the industrial belt that Trump wrested from the party in 2016.Yet the HRC event offered both Biden and his audience a chance to go beyond that simplified framing of the 2020 landscape.“The thing that gets overlooked when the story is written about Ohio and the Midwest is that we’re incredibly diverse,” said Shawn Copeland, HRC’s Ohio director.Copeland said HRC has identified about 1.8 million “equality voters” in Ohio, including 400,000 LGBTQ citizens, plus their family members, friends and other allies. Trump got 2.84 million Ohio votes to Hillary Clinton’s 2.4 million in 2016.Biden, meanwhile, used the forum to underscore his long alliance with HRC and LGBTQ activists — a key to Biden’s contention that he’s more progressive than the party’s left flank acknowledges.The former vice president visibly enjoyed recalling the 2012 presidential campaign when he announced his support for same-sex marriage before his boss, President Barack Obama, had done so.Biden recalled that most political observers “thought I had just committed this gigantic blunder.” He said he’d let Obama know beforehand what might be coming. “I told the president if asked, I was not going to be quiet.”The rest of his remarks were less jovial, as Biden lamented the widespread discrimination that still exists in the U.S. and abroad. Noting recent killings of black transgender women, he roared: “It’s outrageous. It must, it must, it must end. The fastest way to end it is to end the Trump administration.”He lowered his voice as he listed the percentage of LGBTQ children and teens who attempt or consider suicide. “I don’t have to tell you how hard it is for these kids, because many of you were these kids,” he said, “the terror in your heart as you spoke your truth.”Several Democratic hopefuls have addressed HRC state dinners this year. National officials with the organizations say they’ve worked with the campaigns and the state organizations to schedule the occasions.A Biden campaign statement issued before the speech said the choice to go to Ohio proves Biden wants to have conversations about LGBTQ rights “not just on the coasts of this country, but in the heartland and with any and all Americans.”The venue also allowed him to push back, at least indirectly, at some of the jabs from California. He reminded the audience that he campaigned for many of the freshman House Democrats who helped the party to a net gain of 41 seats — mostly by winning swing or GOP-leaning districts.“We didn’t have to be radical about anything,” he said. “They talked about basic, fundamental rights.”With the resulting House majority, Biden noted, the Equality Act has gotten further than ever before. Facebook Previous PostThe Birthday Party of the Century: Hinton Woman Celebrates 100th Tumblr Next PostU.S. Education Secretary Betsy DeVos Offers Support For WV Special Session On Education Mail Twitter Home NewsWatch Biden declares LGBTQ rights his No. 1 legislative priority Google+ NewsWatchPolitical News Biden declares LGBTQ rights his No. 1 legislative priority By Tyler BarkerJun 02, 2019, 16:10 pm 203 0 Tyler Barker Tyler Barker is currently the Interim News Director and Digital Content Manager for WOAY-TV. I was promoted to this job in Mid-November. I still will fill in on weather from time to time. Follow me on Facebook and Twitter @wxtylerb. Have any news tips or weather questions? Email me at firstname.lastname@example.org
BLUEFIELD, WV (WOAY) — A local company’s expansion is bringing dozens of jobs to the Two Virginias. Industrial Plating & Machine is planning to fill up to 100 new positions.IPM is an Original Equipment Manufacturer with state-of-the-art machine, tool and fabricating equipment. Our experienced workforce utilizes up to 250,000 square feet of production space. We also offer industrial and mining equipment rebuilds.“We are truly blessed with great employees and wonderful customers that are asking us to increase our capacity”, said IPM President and CEO Shannon Remines. “We are making a continued commitment to our community. We want to bring jobs back to our area.”A job fair for Industrial Plating & Machine is scheduled for Wednesday, July 24, from 12 to 6 p.m. at 1712 Coal Heritage Road in Bluefield. Local NewsNewsWatchTop StoriesVirginia News Industrial Plating & Machine Now Hiring for up to 100 New Jobs in the Two Virginias By Tyler BarkerJul 11, 2019, 10:55 am 381 0 Next PostMan Arrested After Stealing Car From In Front Of A Hopsital Facebook Google+ Tumblr Pinterest Twitter Mail Previous PostLoaded handgun found in woman’s bag at West Virginia airport Home NewsWatch Local News Industrial Plating & Machine Now Hiring for up to 100 New Jobs in the Two Virginias Linkedin Tyler Barker Tyler Barker is currently the Interim News Director and Digital Content Manager for WOAY-TV. I was promoted to this job in Mid-November. I still will fill in on weather from time to time. Follow me on Facebook and Twitter @wxtylerb. Have any news tips or weather questions? Email me at email@example.com
(Interviewed by Louis James, Editor, International Speculator) [Editor’s Note: Your editor caught up with Doug Casey backstage at the New Orleans Investment Conference, where we both had just given talks.] L: Doug, I know you’re no fan of either presidential candidate – a pox on both their houses – but we got more questions today about what would happen to our investments if one or the other would win than just about anything else. So, what do you think – does it matter? Should we play things differently, depending on which one wins? Doug: Well, I have to first say that I’m the worst US political handicapper ever. I don’t have my finger on the pulse of hoi polloi in the barrios, ghettos, and trailer parks. Nor do I claim to know what Gen-Xers in the city are thinking, nor what passes for the white middle class in the suburbs, nor the oldsters in their retirement homes. I’m not a political animal. The only US presidential election I ever called right was the last one; I thought Obama would win. But then, in New Orleans, I was chatting with James Carville – who definitely is a political animal – and he doesn’t know either. That said, my gut feeling is that Obama is going to win again. That’s partly because the incumbent always has the advantage, and partly because the mainstream media – which is where most people both get their information about what’s happening in the world and how to interpret it – seem to overwhelmingly favor Obama. L: I thought you didn’t like making predictions… Doug: I don’t, but purely for entertainment purposes, I’ll stick my neck out and predict an Obama win. Perhaps a deeper reason for this is that the electorate itself has become corrupted – even more than they were four years ago. L: When more than half of voters receive some kind of government subsidy or another, they can always be counted upon to vote for more government largess, and the game is essentially over? Doug: It’s a serious problem of mass psychology. Most people today think that whenever there’s a problem, it’s the government’s job to “do something” about it. Obama is – at least as far as his rhetoric goes – much more activist about “doing things” than Romney. On the other hand, all politicians are enthusiastic and skilled liars. So Romney might go wild with social programs, all the while saying something idiotic about trying to save capitalism. L: People are afraid and one paycheck away from being evicted, and Obama’s the one promising two chickens in every pot. Doug: Exactly. The election of 1932 is noteworthy in that context: a time of economic crisis, depression, and politicians promising “bold measures.” The key is that the Depression unfolded on Hoover’s watch, so he gets the blame. But he actually does deserve a lot of blame. If he’d cut taxes and spending radically and deregulated, it would have been a short readjustment, like the 1921 depression after World War I. He did the opposite. In point of fact, Hoover started many socialist programs along the lines of the New Deal programs FDR later became famous for. The Hoover Dam, for instance, was a major public-works project such as the Public Works Administration would later undertake, meant to create jobs. He also increased the top income-tax bracket from 25% to 63%. Most people don’t know this, but Roosevelt … L: …campaigned against such measures. Doug: Yes, he campaigned on a free-market platform that seemed to offer hope that he would do the right things; and then, once in office, he turned around and did the exact opposite. He raised the top tax rate even further, first to 79%, then 81%, then 88% – and with that last one, in the middle of World War II, he dropped the income level it applied to from $5 million to $200,000. Contrary to popular belief, this did not get the US out of the Great Depression, but made things worse. The only reason he’s regarded as a hero today is that he had the singular good luck to enter office in 1933 – when the worst part of the Depression was over. But he did make it worse, and people still think Roosevelt’s programs helped, and most people believe it was the war that ended the Depression. In fact, real recovery didn’t begin until after the war. L: Flash forward to today. If things are similar, that would make Obama the incumbent with the socialist track record, and Romney today’s FDR. Romney’s the one people see as a businessman who knows how to do things to help the economy – even though as governor, he implemented a socialized medicine program before Obama tried to. Doug: The problem is that the US hasn’t really had a liquidation of malinvestment as it did from 1929 to 1933. So I think whoever is elected now is going to get blamed. Romney is an empty suit. He’s said that he doesn’t plan to cut welfare, wants to spend much more on the military, and he has other spending proposals that make him nothing more than Obama-light. This is actually what Republicans have almost always done, because most have no principles – certainly none in modern times. L: So what happens if Romney wins? A lot of people seem to believe it will make a huge difference. Doug: Well, he might be better for taxpayers in the short term; but, for the long run, it would be very unfortunate if Romney wins. That’s because he would be associated with free-market economics, as Republicans almost always are. A real pity. The social and economic disaster that’s looming over the next four years would incorrectly be blamed on capitalism. I’m convinced the Greater Depression has started. We’ve gone through the leading half of the storm. Obama got the eye of the storm, and now we’re headed into the trailing edge of the storm, which is going to be even worse than what we saw in 2008-2009. L: It’d be just as the Great Depression, which resulted from government interference in the economy, is usually blamed on the “unrestrained laissez-faire capitalism” of the 19th and early 20th centuries. Doug: Exactly. And if two Great Depressions were seen to be caused by free enterprise, that would deeply entrench a highly destructive error and have long-lasting consequences. From a long-term point of view – if you care about posterity – it’s actually better if Obama wins. Then socialist-style ideas might get more of the blame for the train wreck. On the other hand, the continuing global economic crisis (and much worse to come) would be a great excuse for Obama to open the floodgates on all kinds of really, really stupid ideas. L: As a second-term president with no possibility of re-election to worry about, he could go wild, no holds barred. Doug: Yes. He’d have time and a free hand to firmly entrench many seriously bad ideas in Washington. And once a new program gets its own bureaucracy, with its own buildings, it’s impossible to get rid of. Lenin was right when he said, “The worse it gets, the better it gets.” L: So we’re damned either way? Doug: I’m afraid so. I’ve said it before: there’s no way out but through the wringer. We get a deepening of the Greater Depression regardless of who wins. If Romney wins, it gets blamed on capitalism, which would be a long-term disaster. But if Obama wins, we’ll get a Krugman-Stiglitz wet-dream of a government. That would be a complete near-term disaster. L: So if I had terminal cancer and I voted, Romney would be my man? Doug: Maybe, if you didn’t think you’d last more than a year or so. You’d likely get to keep more of your money while you lived. But there’s another important difference: the federal bureaucracy is now thoroughly populated with Obama’s apparatchiks. Romney couldn’t save the US from the Greater Depression, even if he were a real free-marketeer – which he most assuredly isn’t. But he could expunge a lot of those poisonous parasites, replacing them with his own crew. We’d still have just as many parasites, but perhaps of a slightly less toxic variety. And even if they were just as bad, they’d still take a while to get going, so there’d be a reprieve for that time, at least. L: You’re absolutely sure there’s no way Romney could save the day – even if he revealed himself to be a Ron Paul clone, once he got into the White House? Doug: No. The state itself has too much momentum in the wrong direction now. As I’ve pointed out before, any serious changes would result in a talking-to by the heads of the various Praetorian agencies. If he survived that, the Supreme Court would strike down most of what he did, and the Congress would legislate against it. And the people would riot, as if they were Greeks. As you pointed out, when the people realize that they can vote themselves free lunches rather than work for them, a democracy is doomed. L: Who was it who called democracy “an advance auction on stolen goods?” Doug: H. L. Mencken, a genius – one of my favorites. But what he actually said was that “every election in a democracy is an advance auction on stolen goods.” We covered the futility of trying to get the “right” person elected in our conversation on Ron Paul. The state is corrupt, the politicians are corrupt, and the final straw, the electorate is corrupt. There’s no way out but through the storm. L: Famous last words. Doug: I know, but that’s the way I see it. It’s as with Wile E. Coyote. He runs off a cliff, and you logically think he’s going to fall right away. But he doesn’t – his feet keep windmilling in the air, and the law of gravity doesn’t kick in until long after he should have dropped. The US now resembles nothing more than a hapless cartoon character. In essence, the things we think must happen usually take much longer than we imagine possible. But once they start, they usually happen much faster than we imagine possible. But I’ll go out on a limb again and say that I’m reasonably certain the economic house of cards that the US and other governments have been propping up since 2007 will collapse not just within the next four years, but likely in 2013 and 2014. It’s happening in Europe now – they really have reached the end of their rope. It’ll happen shortly in Japan as well, the most indebted society in the world. It’’s going to happen in China. And that’s going to bring down the resource-oriented countries – Brazil, Australia, South Africa, Canada, Russia. It’s going to be a worldwide cataclysm. This whole debt issue, by the way, is critical. As I’ve said numerous times, you get wealthy by producing more than you consume and saving the difference. The opposite, consuming more than you produce, results in the depletion of wealth, either as savings are drawn down or debt is accumulated. You’re either destroying the productive capacity of past accumulations of capital or mortgaging the productive capacity of future accumulations of capital. Either is bad economics, whether for a household or a country; and we’re seeing both – and will continue to see both, regardless of who wins the next US election. With the idiots who run the world’s central banks doing their best to keep interest rates at near zero – actually severely negative in real terms – they’re discouraging saving and encouraging even more debt. There are no political solutions. The economic problems are bigger than any politician. There’s no way out. I pity the poor fool who wins this election. L: Let’s look at the short term again. If Romney wins and lots of investors think he’ll “fix” the economy, there could be a surge in the stock market based on nothing more than expectations. On the other hand, if Obama wins and investors expect higher taxes, they could sell in advance of that happening – people are talking about “tax-gain selling” this year in addition to tax-loss selling. Doug: I really don’t think any of that matters. People think the economy rests on a base of psychology, but they are wrong. What makes an economy work is not confidence and not consumption, but production. What makes an economy grow is savings – accumulation of production in excess of consumption that can be invested in new things. If Romney wins, people start spending on consumption again because they’re confident, but that’s not a good thing. What needs to happen is for past mistakes to be fully and truly liquidated, and the economy needs to be freed so that people can produce more, consume less, and save. Then we can build a real solid foundation for future growth. All the conventional hack economists, however, believe that the banks should lend more to enable people to consume more, and that will stimulate production. That’s going to make things worse. It will be production catering to unsustainable patterns of consumption – further exacerbating the problem, which is that the US and many countries have been living way above their means for a long time. L: I agree, but economic fundamentals are subject to transient headwinds and tailwinds. A lot of investors – including many gold bugs – think that if Romney wins, he’ll be good for the economy, and that will make people less fearful, and that will reduce gold’s luster as a safe haven. The driving reality is the trillions of currency units that governments around the world have created – an interesting side note is the recent all-time-high that gold reached in euros – but prices are fixed at the margins. Very near term, even incorrect expectations could impact prices, could they not? Doug: I think it’s a mistake to try to predict mass psychology on a short-term basis like this. Too volatile. A bad day on American Idol could change things drastically. But here’s how I read it. Romney is a not particularly thoughtful pragmatist with no real principles. If he wins, he’ll probably implement just as many wrong-headed socialist ideas as Obama would, varying only in their details and pet interests, not in their essential nature. Just like Obama, he’s going to try to use the government to fix the economy, and that’s the exact opposite of what needs to be done; the government needs to get out of the way and let economic activity go where it will. He’ll “do something.” He’ll just tart up his actions with different rhetoric. So things are going to get much worse whoever wins, and if it’s Romney, it’s more likely that he’ll resort to military adventurism to “wag the dog” more quickly. Obama has continued the war in Afghanistan and likes to take credit for the extrajudicial killing of Osama Bin Laden – he’s so drone-happy, I almost wonder if he’s the president who’ll activate Skynet – but Romney is clearly the more hawkish of the two, and that’s one of the worst things about him. L: So, don’t vote… But we’ve already said that. Doug: Well, if you insist on voting, consider pulling the lever for Gary Johnson, the ex-governor of New Mexico, on the Libertarian ticket. The die is cast for the next few years. The US deficit will continue ballooning and the Fed will keep printing up dollars, regardless of who wins. But if you care about the consequences of this election, the main consequence to consider is the impact on the next round in 2016 – assuming the US still has elections by then. Things will be so bad in the next few years, people will be looking for something different. They’ll have no hope, and they’ll want serious, radical change. If Romney wins, the Democrats will take the White House in 2016 for sure, and that will likely mean Hillary. She’s perhaps the most dangerous Democrat possible, a real-life version of Dickens’ Madame LaFarge, or perhaps a reincarnation of Evita Peron. About the worst person I could think of to ever become president. She would totally wipe out whatever little is left of America by then. On the other hand, if Obama wins, the Republicans will probably win in 2016. By then, things will be such a mess, so chaotic, it will be time for a general to step into the ring. People in the US love their military now – a strange thing to see for someone who remembers how hated the military was during the Viet Nam war. No one would have dreamed of voting for a general back then. But now, a right-wing general who’s perceived as being decisive and incorruptible could play the role of the “man on a tall white horse” who can lead the nation forward. And that would not only increase the chances of more stupid, wasteful wars, it could really turn the US into a true police state. He’d treat the country like a military camp. L: If we’re damned if we do and damned if we don’t, what’s a person to do? Doug: The only thing to do is to stop thinking politically. Stop looking for political solutions to socioeconomic problems; political solutions are poisonous, certainly at this point. The political system is terminally corrupt – it needs to be flushed. Look to take care of yourself first. If you’re not in a strong, stable position, you won’t be able to help your family, friends, and others you care about. As cold-hearted as it may sound, the right thing to do in a period of social disintegration and economic collapse is to look out for #1. Make sure you’re not a liability to yourself and others. Charity begins at home – that’s the first order of business. Second, after you’re secure, look out for your friends and family – at least the ones who will listen and you can move to take action in a sensible direction. This is the best thing you can do for them, but it’s also a selfish thing to do for yourself; you’ll need all the allies you can get, going forward into turbulent times. If you have time and energy left from that, you can start looking into what influence you can have on the larger world. Which is to say, only at that point can you afford to think politically. But that’s pretty far down on the hierarchy of importance these days. L: Investment implications. Is there no “Obama play” or Romney play” – some trade you might rush out and implement depending on who wins? Doug: No. The only certainty I see is increased financial chaos. An argument can be made for catastrophic deflation, but I believe we’ll see the opposite. The Fed has promised a minimum of $40 billion a month in new liquidity. And at some point the banks, which are generally not lending much, will start doing so. When all the cash they are sitting on starts flooding into the economy, we’ll see inflation in earnest and interest rates of 10%, 20%, even 30%, just like in a banana republic. That’s going to trash the US dollar. And since most savers save in dollars, that’s going to wipe out the productive class, worldwide. Furthermore, as we’ve pointed out before, there’s a super-bubble in government bonds. I call them a triple threat to your wealth: interest rate risk, credit risk, and currency risk. Rick Rule has taken to calling them “reward-free risk.” Just as the tech bubble burst in 2000, and then the real-estate bubble burst, the next one is the bond bubble, with immense destruction of capital. I continue to say that, as impossible as it sounds, that all markets are overpriced. There is simply nothing in the whole world – not stocks, not bonds, not real estate – nothing that I can say without qualifications is cheap. So, with everything riding high, you’ve got to continue accumulating gold and silver to protect yourself from financial chaos, and you’ve got to diversify yourself internationally to protect yourself from government chaos. To speculate, of course, there are the gold stocks. They’re a leveraged bet on government continuing to do the wrong things. I’ve said it before and I’ll say it again: the governments of the world consider people to be their property. Right now, they see their subjects as milk cows, but when things get really rough, they might see them as beef cows. L: The end is nigh. Good thing you’re an optimist. Doug: [Chuckles] We should make sure new readers understand that you’re not just being sarcastic. I do think things will get even worse than I think they will, but I also believe they will subsequently get even better than I can imagine them being, thanks to the longest trend of them all, the Ascent of Man. L: Indeed. Thanks, Doug. Doug: My pleasure.
Guest Editorial from Bobby Casey GlobalWealthProtection.com The deal struck for Cypriot Banks targeted “evil money launderers and tax evaders” as well as wealthy oligarchs, but really plunders the hardworking saver and entrepreneurs. While emotions run high, and the victims of this absurd plunder are myriad, there is a culpable group responsible for this mess, and it’s safe to say it’s not EVERYONE with a Cypriot account holding over EUR100,000. The Cyprus deal – whether you call it a bail-out or a bail-in really matters little – left a LOT of individuals in the lurch and many others destitute. You begin to see the true colors of how folks feel toward their own, personal, wealth. And sadly, you also tend to see divisiveness regarding who should bear the brunt of consequences. As mentioned in an earlier post, those who hold over EUR100,000 are subject to lose everything above that amount; and nearly one-third of those with that kind of wealth are Russian. Recently, it was discovered that some Russian Oligarchs managed to somehow move large amount of capital out of both the Bank of Cyprus and Laiki (Cyprus Popular Bank) just a day before the deal was struck: when all accounts were supposedly FROZEN. If enough wealth was removed, the whole bail-in/out and destruction of the Cypriot system was for not, as the plan relied on a certain amount of money to make it work. Who’s left then to take the hit? Well, there are the small to midsized businesses who kept accounts in Cypriot banks as liquid working capital, for such day-to-day things like payroll, purchases and operations. What will happen to their employees if there is no cash with which to pay them? What will happen to their store fronts if there is no cash with which to pay bills or rent? One particular business posted its shocking findings on Thursday (Check out the “blocked funds”. Think they’ll be seeing any of that ever again?): While this offends me to the core, there is a bit of a heroic twist to this story. The business owner posts, “We are moving to small Caribbean country where authorities have more respect to people’s assets. Also we are thinking about using Bitcoin to pay wages and for payments between our partners.” Expatriating and switching to an alternative currency is not only bold, but look at this guy picking himself up by the bootstraps to take his productivity some place where he won’t get the rug pulled out from under him! He is a page right out of “Atlas Shrugged“! A Cypriot John Galt, if you will! Unfortunately, not all who those adversely affected have the time or ability to do as the business owner in the above story. Just last Friday, the Sydney Morning Herald, did a story about one Cypriot-Australian (65-year-old John Demetriou) who escaped Cyprus during their war with Turkey, fled to Australia, and starting from nothing managed to amass $1 Million AUS. He lived off the interest, and helped his grandchildren and ailing mother of 90 years old. With plans to retire in his native Cyprus, he puts his entire savings into Laiki. As he puts it, “I went to sleep Friday as a rich man. I woke up a poor man.” Due to his heart condition, he cannot return to Australia. Sadly, his money wouldn’t have been much safer in Australia! If he never touched the principle and lived solely off the interest, their government might very well consider the principle “idle”. And if it has been that way for three years, he could very well have lost it all to a different government by the end of May. Talk about not being able to catch a break! In his statement, Demetriou goes on to say, “It’s not Russian money, it’s not black money. It’s my money.” While my heart goes out to him and every victim of this senseless plunder, as bystanders, indulging the temptation to assess who “deserves” to get plundered serves no good purpose or end. This man suffered at the hand of that same “reasoning”. The EU defined “rich” as accounts with over EUR100,000. They entertained the class-warfare ideology, and abandoned the tax levy across the board, only to place the burden on the shoulders of those making over a certain amount. We hear these stories of banks, lenders, investors, oligarchs, and often the sympathy river runs dry rather quickly. Everything from the Occupy Movement to the austerity measures throughout parts of Europe have fanned the flames of class warfare. It has nothing to do with socio-economic status. It has to do with irresponsibility and corruptible power mongers. The state of being wealthy in itself is benign. Being wealthy and responsible is productive and helps society. Being wealthy and manipulatively irresponsible, on the other hand, reveals its consequences in scenarios like bank bailouts and corporate subsidies. The frugal, responsible saver who happens to have wealth bore the consequences for the fast-and-loose bankers and the privileged oligarchs who also happen to have wealth. At the end of the day, no one deserves to be plundered. Cyprus made a grave mistake, which will have an indelibly adverse effect on the Cypriot economy. The pathetic attempt of the EU at some semblance of a “solution” convinced NO ONE that the EURO is stable or that the EU is anything more than a bunch of German and Dutch autocrats. They overtly punished an ethic, and ultimately condemned Cyprus to an economic tragedy far worse than had the EU left it alone. [Editor’s Note: For more articles like this one, visit GlobalWealthProtection.com and sign up for the Free Asset Protection Newsletter with tips and ideas you can use to keep you, your family, and your assets safe.] Cyprus – Casualties of Plunder: Condemning an Ethic into Exile by Bobby Casey
Today I’m happy to welcome back one of our most popular contributors: James Altucher. James is currently a hedge fund manager, but that doesn’t begin to explain his fascinating and varied career. A serial entrepreneur, James shunned the corporate ladder from an early age, opting instead to create something of his own. And boy, did he. James founded, built, and sold a web design company in the late 1990s for $10 million. He also founded and built stockpickr.com—and sold it, too, for another $10 million. Below, James shares why his decision to stop working for others and start working for himself was the most liberating choice he’s ever made. As you’ll read, financial riches are just one of many rewards for venturing outside of the employment comfort zone. Or, as James likes to call it, “your self-imposed jail cell.” Enjoy. Dan Steinhart Managing Editor of The Casey Report P.S. For portfolio balancing purposes, a Casey Research editor needs to sell shares of Balmoral Resources. There’s no change in the recommendation for this stock, but our rules mandate that we notify subscribers so that they can sell, if desired, before the staff member may do so. Don’t Be a Slave! By James Altucher I hate being a slave. One might think: don’t be a jerk. You weren’t in chains in the 1800s. That was real slavery. Ok, I hate arguing. Go away. But I’ve been a slave. And it was hard work to get out of it. Slavery comes in many forms. Let’s take a look at the average person. The average person works at a job. Fine, you might say, a job is a lot different from slavery: I can take a water break, for instance. And sometimes go to the bathroom. And when I talk to people the same sex as me, there aren’t even any rules governing what I can say. Great. I agree. But let’s just take a look at your income and your behavior. Sure, you might say, I realize I don’t get all of my income. About 40% goes to taxes. And there you would be wrong. — Your true salary is the value you create for the place you work. Some percentage of it goes to your boss. He has to get paid also, you know. Who do you think pays him? You do. Some percentage of your salary goes to his boss and however big the hierarchy is. I know this, having been a boss, having run a company, and having been an employee. I’m also on the board of directors of a company with a billion in revenues that is one of the largest employers in the United States. Do you know what they do? They are an employment agency. I see the numbers. The actual numbers of what is happening in the economy. The actual unemployment rate, where people are being fired, rehired, demoted, demoralized, and spit out of the machine when they are no longer of any use. So I see what happens in the machine and what we can do about it as people (as I assume all readers of this newsletter are) who want to be free. Some percentage of your “salary” goes to the shareholders of the company before you even see it. And some percentage goes to the vendors of the company. Like the insurance “benefits” your company gives you that you most likely will never need (if you were likely to need them, then the benefits would be higher, until you no longer need that much. That’s how insurance works). And some percentage goes to employees that don’t pull their weight. The 80/20 rule applies where approximately 80% don’t pull their weight, so any money left over from your efforts has to be used to pay them. You pay them. And you have no control over that. Finally, you have to pay for your cubicle, your office supplies, the computer on your desk, your phone, etc. If you created no extra money to pay for these things, then they wouldn’t exist. So this comes directly out of your salary. I call all of the above your “Above the Line” salary. Try to figure out what your Above the Line salary is. You can say, “My company gives me the opportunity to make this Above the Line salary.” That’s fine. But they take quite a bit. It’s probably four or five times higher than your “Below The Line” salary. There are ways to get your “Above the Line” salary so you personally benefit from it. Most companies are very wasteful, and you pay for that waste directly out of your salary. Then there’s your Below-the-Line salary. 40% goes to federal and state taxes. This is already after your services have been taxed at the corporate level; now you’re being taxed another 40% at the personal level. Note that only salaried employees pay 40%. Nobody else does. The richest Americans pay less than 15% on average on gains in their net worth. That’s because salaried employees are slaves and have the least political power. Another 5-8% goes to taxes on everything you consume. Now we are almost at 50%. Then, like most Americans, you have a mortgage. Maybe this is another 10-20% of your salary. Your company likes you to own your house because you are less likely to quit (you need the money to pay the mortgage) and you are less likely to move (you’re not mobile). Then there are student loans you are paying off. For the first time ever, greater than 50% of the unemployed have college degrees. So it’s pretty scary. You got this degree because (in part) you thought it would get you a job. But it didn’t guarantee anything, and now you have to pay for it. Some percentage of your salary is sliced off every month to pay for that degree. Then some portion of your salary goes towards health, upkeep of your relationships (they always cost money. This is not being cynical. Just reality), your transportation to your job (they force you to pay for the honor of transporting yourself to your slave quarters). How much goes to you? You wake up before dawn. You travel. You work hard. You come home late. You’re feeling stuck. You’re mildly depressed and may take medication for this. And you have trouble sleeping and digesting. Shouldn’t you get paid more? As it stands, between Above the Line and Below the Line expenses taken out of your salary, you are probably left with 1/10 of your salary. In other words, you could be making ten times as much money if you started to un-slave yourself. Then there’s behavior. “I can do whatever I want,” I used to say. In fact, when I was at a job, I felt free. I could “sneak out” at 4 pm. I could take lots of breaks. Vacations were big. But did you look at the manual? There’s a big manual. And sometimes there are workshops to go over the manual. Like you can’t talk to people of the opposite sex in certain ways. They teach you the acceptable ways to talk to people of the opposite sex. You can’t talk to your boss a certain way. Because for all of your slavery, all he has to say is, “You’re fired,” and all of that goes away. You can’t wear what you want. Most office situations have a uniform, either explicit or implicit. You can’t be friends with who you want. You’re mostly just friends with the people you spend your day with—the other slaves. When they go away, you never talk to them again. You can’t be creative when inspiration hits. “Anything done on equipment owned by the company is intellectual property owned by the company.” Good luck arguing with that one. You can’t have an office romance, even though those are the only women you know. For one thing, you might get fired. And all of your emails can be read by Human Resources. My closest friend when I was at HBO was fired when his office romance went awry and all of his emails were read by his boss. If you want more money, you have to beg for it. There are entire seminars created just to teach people how to ask for 5% more money at work. People are scared to death to ask. And by the time you get home to have real social interactions, you’re tired and bitter and angry at work. I know I’m doing a little bit of projecting here. This was my personal experience about having a job. I felt like a slave. I hated it. Maybe a lot of people like it. But I am just doing the math. The Above the Line salary is real and comes straight out of your pocket before you even knew that money was there. Most people can make 5-10 times more by being creative and figuring out how to offer services on their own without the company taking out all of the “Above the Line” expenses. And then there are ways to limit the “Below the Line” expenses. Money won’t solve all of your problems, but it will solve your money problems. Don’t let them take your money so they can keep you in slavery. You want to own your time. Own your work. Own the value you create for others. Protect yourself so nobody can fire you. Not be owned by the bank or the government. Not be owned by your relationships. Own your thoughts. “I can’t just quit my job!” you might say. And I agree with this. Don’t quit. So many people read self-help books to help them deal with what they think are the realities of work. Self-help books are often self-hurt books because they try to keep you happy about being enslaved. For instance, “Show compassion to the people who hurt you,” many of them say. This might be good advice. But I’d rather show compassion to the people who love me. Start to be an explorer. We live in a 15-trillion-dollar economy. You helped create it. Just like slaves and death and misery helped create the beautiful pyramids. But 90% of what you create is taken from you. Start to explore what parts you can take back. Work every day on ideas. List every interest you’ve had since you were a kid. List every business or job that can be started from that interest. Read every day about your interests. Don’t be angry at the people at work, even your boss. They are all slaves also. You need to break free from them. Don’t indulge your free thoughts on the other slaves with their Rolex shackles. Study the lives of people who aren’t slaves. What did they do? Study the people online who seem to have broken free. What are they doing? Keep working on the idea muscle I discuss in my book. I did this. And in six months, my life changed completely. Sometimes for the worse. Much worse. I didn’t know what I was doing and sometimes I ended up on the floor, depressed and suicidal. Sometimes freedom is very scary. It’s outside of the jail cell (“comfort zone”) you created for yourself. But every six months since then, my life has changed completely. My life is completely different than it was even six months ago. Sixteen years ago, I had a boss yell at me. He’s a good guy and has since broken free himself. But one time, he yelled at me and I couldn’t yell back or I would risk being fired. I felt like crying. Actually, I did cry. So I went to the library on 41st Street and 5th Avenue. I found a science fiction book I read once before as a kid. It had that cellophane wrapping and a library card in it. And it had that smell when you open the pages. I went three or four levels down, to my private bathroom in the library. My sanctum sanctorum. And I sat there and I read about a man who lived forever and was happy. And the world disappeared, and for a brief moment I was no longer a slave. From that moment on, I plotted my escape. And every day since, I figure out new ways to escape, new ways to be free. New ways to own my world. [James Altucher is the author of the book, Choose Yourself! He has started and sold several companies and failed at many others. He can be found at jamesaltucher.com, and he’d love it if you sign up for his email list, which has all sorts of fun goodies.]
In This Issue. * Yellen throws a changeup. * Chinese return to work with a weaker renminbi. * Chinese PMI’s rise above 50! * Gold shows how rate sensitive it is.And Now. Today’s A Pfennig For Your Thoughts. Kiwi Puts On A Show. Good day.. And a Wonderful Wednesday to you! Well, I lived through my initiation to the “cool drink club” last night. There I sat with my new friend, Gus, sipping on a vodka martini, and imagined myself at the bar with cool guys, like James Bond, and Dean Martin. fun stuff, for sure, but I can tell you straight from the heart that I’ll not be ordering up any martinis any time soon for me! Jesse Colin Young, and the Youngbloods with their song: Let’s Get Together, greets me this morning. Come on people now, smile on your brother, everybody get together, try to love somebody right now. Now there are words to live by! Front and Center this morning, the currencies have fought back VS the dollar and are no longer clinging to the ropes with their rope a dope routine. What brought about this change in direction? Janet Yellen. I told you yesterday that there was risk to what everyone and their brother was thinking that she would say, if she didn’t say it. And in so many words, she didn’t say it. So, let’s gather up all our belongings, tidy up our work space, pour a cup of coffee, and settle into a chair. All good now? Ok, here’s the skinny on Yellen’s talk yesterday, brought to you by your friendly neighborhood Pfennig scribe! Well, what do we have here? I sat by my laptop most of the morning yesterday hoping to catch the market’s reaction to whatever it was that Fed Chair, Janet Yellen, had to say, either way, win, lose or draw. And the winner was. draw. She neither sounded hawkish or dovish.. She sounded, well, like someone that just doesn’t have a clear picture of what they want. let’s listen in. “It is important to emphasize that a modification of the forward guidance should not be read as indicating that the committee will necessarily increase the target range in a couple of meetings. Instead, the modification should be understood as reflecting the committee’s judgment that conditions have improved to the point where it will soon be the case that a change in the target range could be warranted at any meeting.” OK.. here’s Chuck’s interpretation of what she said, without saying it. You all are thinking that we’ll hike rates in June. But I’m here to tell you that we won’t be tied to any particular meeting, and we reserve the right to change when we feel it’s necessary. Wouldn’t that have been much easier to say and understand? Well, Big Al Greenspan brought about what they called “Greenspeak” , Ben Bernanke didn’t have a word for what he spoke, unless you ask me on the Butler patio, and now Janet Yellen is soon going to have her own word for her speeches. But the thing I took from this testimony yesterday is simply now she’s given the Fed and her an “out” and they won’t have their feet held to the fire for not hiking rates in June. Pretty sly about it, but I see it for what it is, and I only have one eye! Yes, they can drag this ZIRP (zero interest rate policy) out till the end of time. Yellen tried to offset this new rate scenario with upbeat talk about the economy. Huh? I would have thought that she would use this opportunity to tie the weakening economy with her decision to not be tied to a June rate hike. But, that’s just me I guess. it’s what I would do if I were Fed Chairman! So, as I said above, this talk and feeling that the rate hike is being delayed, really sent the dollar to the woodshed, and then this selling of the dollar continued throughout the overnight and morning sessions. One exception to the currency rally was the Chinese renminbi / yuan. The Chinese had been on holiday for the last week, and therefore they had some catching up to deal with all the dollar strength during that same time period. There was some good data from China overnight though.The flash PMI (manufacturing index) rose to a 4 month high of 50.1 VS what the experts were thinking would be a 49.7 print. There was some rot on the PMI’s vine though, as the new export orders component fell from 50.1 to 47.1, the sharpest rate of contraction in almost 2 years.. So, we need to keep an eye on that going forward. As we near the end of the month, another one bites the dust, yeah, another one bites the dust, I thought I would look at the month in the currencies and see what currency outperformed all the others VS the dollar. And that currency in February would be the New Zealand dollar / kiwi! Despite all the dissing of the currency from Reserve Bank of New Zealand (RBNZ) Gov. Wheeler, and despite the fact that the RBNZ sold more than 16 million kiwi during the month, kiwi has weathered the storms created by the RBNZ, and other countries that just keep lining up to cut their interest rates, and found a 3.8% gain VS the dollar this month. RBNZ Gov. Wheeler, tried to stop a kiwi rally in its tracks last night, by telling reporters that Auckland has a housing supply shortage, which is causing house prices to rise. But it didn’t have the same effect on kiwi as some of his other well-known disses of kiwi. Wouldn’t it be nice if we were older then we wouldn’t have to wait so long. No wait! I wanted to say wouldn’t it be nice if kiwi built up a suit a armor that would reject Wheeler’s words? Now that would be Tre’ Cool! And in another follow up to my Sunday Pfennig piece on the pound sterling two weeks ago. Bank of England (BOE) Gov. Carney, was talking last night, and there are times you wish so badly for someone to stop talking, and this was one of those times. He first mentioned that “Our job as the Monetary Policy Committee is to bring inflation back to the 2% inflation target, and we will do so in a reasonable horizon.” OK. that sounds fine, but then he went on to say, ” That horizon, given the wave of shocks hitting the economy at present, should be within the next 2 years.” Wait! What, what? It’s going to take the BOE up to 2 years to get back to 2% inflation? That’s not going to help the pound any, as to achieve that goal interest rates will be required to remain near zero. So. The Eurozone leaders accepted Greece’s homework assignment, and all’s well in the Eurozone again, at least for now. Soon, everyone will be pointing to June as this will be the ending month of the extension that Greece bargained for to continue their current loan agreement. The euro is stronger this morning, but I would have expected a bigger bounce from not only the Greek debt problem not coming to an acrimonious head, and Yellen’s speech/ testimony. But life’s little pleasures. you have to take them when you can get them, eh? In Brazil, where the real has become the laughingstock of currencies once again, Dilma Rousseff believes she has the answer for the country’s economy. She calls it austerity. It’s a plan to improve the country’s finances, by trimming their debt. so, good for them. But, in a country like Brazil, I would think that making such plans to do things like cut unemployment and pension benefits, would end up badly for the President Rousseff. I guess we’ll have to wait-n-see how this all plays out. I’m thinking that it’s good intentions, but bad execution. Sweden’s Riksbank Gov. Ohlsson told reporters this morning that he can’t cut rates much more.In all actuality, I guess he could continue to go negative as much as he wants, but that’s not going to help things, so I get his point. the krona, which has been right behind the Brazilian real in terms of loss of value and credibility, rallied on these comments. Once in a blue moon, the krona rallies these days folks. Well, now that the cease-fire / peace agreement between Ukraine & Russia is over a week old, traders are returning to link the ruble to Oil on a larger scale. Unfortunately, the price of Oil had its brief rally stopped in its tracks last week. The ruble still has pushed the currency appreciation envelope to higher values. In December last year, I remember the talk on the desk was about how at some point the ruble would become a value, but no one would offer up a strong sentiment about when that “some point” would come. Well, it appears to me that as long as the peace agreement can hold, that was the “some point”. Of course, one might argue that until the price of Oil rebounds further, that will be the “some point”, and I see that too! In other words, the “some point” may have already been given to us, or, it might still be out there somewhere. I know I’ll find you somehow, somewhere! Well, Gold sure has been “rate sensitive” now hasn’t it? Strong talk of a rate hike in June, brought the shiny metal below $1,200, and then having cold water thrown on that strong talk, allowed the shiny metal to rise above $1,200 again. Palladium took another one of those huge leaps it’s known for and is trading above $800 again this morning. I watched a video of the great James Grant speaking that appeared on Kitco.com, and I have this one thing that he said that caught my eye. “It seems to me that the world will eventually see that these policies (by central banks) are non-starters, or if they are starting they won’t end well. That for me is a simple case for Gold.” – James Grant. I love reading James Grant’s newsletter and it’s something that I’ve missed being away from the trading desk for these last two months. Of course that’s not all I miss being away from the trading desk. the people on the desk that I hired, and worked with for many years, and then the people around the desk too. But there’s one thing I definitely do NOT miss, and that’s the walk across the wind tunnel bridge every morning! The U.S. Data Cupboard slows down a bit today, after yesterday’s onslaught of data that didn’t turn out especially too good for Consumer Confidence and the Richmond Fed Manufacturing Index. Both fell in numbers that were greater than what was expected. The S&P/ CaseShiller Home Price Index saw a bounce in December. Yes, I know it’s almost March, and we’re just now seeing this data for December! But it was better than expected and the previous month, so at least we now know that home prices were better in December, for whatever good that might do. Before I go to the Big Finish today, I have a note from the Big Boss, Frank Trotter. Take it away Frank. “The tidbit that Chuck reported in yesterday’s Daily Pfennig about JP Morgan Chase beginning to charge some institutional clients to hold deposits was all over the banking news the last couple of days. I did want to note that we’re open for business and if your bank is taking an action like this do give us a call here at EverBank, we probably have great solution for you.” For What It’s Worth. Well, it was a slow news night, except for what we already talked about! So I had to dig deep to find this one, but it’s former Fed Chairman, Big Al Greenspan, giving an interview to this website: http://www.shtfplan.com/headline-news/federal-reserve-insider-alan-greenspan-warns-there-will-be-a-significant-market-event-something-big-is-going-to-happen_02222015 this seemed so interesting I had to make an exception here and let Big Al have his say. for what it’s worth, really plays out here. “We asked him where he thought the gold price will be in five years and he said “measurably higher.”In private conversation I asked him about the outstanding debts. and that the debt load in the U.S. had gotten so great that there has to be some monetary depreciation. Specially he said that the era of quantitative easing and zero-interest rate policies by the Fed. we really cannot exit this without some significant market event. By that I interpret it being either a stock market crash or a prolonged recession, which would then engender another round of monetary reflation by the Fed. He thinks something big is going to happen that we can’t get out of this era of money printing without some repercussions – and pretty severe ones – that gold will benefit from. Chuck again.. yes, the “he and him” is Big Al Greenspan’s thoughts. I don’t know how I want to take this newfound ability to see stuff, when he admitted when he was chairman that he couldn’t see bubbles. But, anyway he makes some valid points in the interview, which was taken from his talk at the New Orleans Investment Conference. To recap. Well, Yellen’s speech/ testimony brought about a different thought process in the markets regarding the time of the first rate hike by the Fed, and that caused a complete reversal in the dollar’s trading VS most currencies. The Chinese came back to work after a week’s vacation and decided to play catchup with the other currencies that have been weak VS the dollar this past week, and they weakened the renminbi on its first day of trading in a week, even after an improved manufacturing index print. The Russian ruble appears to be back to being tied to the price of Oil for a large part. Kiwi is best performer overnight, even with Wheeler doing his best to keep a lid on the currency, and Gold rebounds back above $1,200. Currencies today 2/25/15. American Style: A$ .7875, kiwi .7550, C$ .8045, euro 1.1345, sterling 1.5490, Swiss $1.0525, . European Style: rand 11.4550, krone 7.5955, SEK 8.3520, forint 269.20, zloty 3.6670, koruna 24.1670, RUB 62.28, yen 118.80, sing 1.3550, HKD 7.7555, INR 61.96, China 6.1384, pesos 14.89, BRL 2.8445, Dollar Index 94.36, Oil $49.07, 10-year 1.95%, Silver $16.61, Platinum $1,170.38, Palladium $804.00, and Gold. $1,209.23That’s it for today. The Sunrise this morning brings us an orange sky. Yikes, the Blues lost at home last night, and badly too! That’s not like that team to lose at home. the great Jimmy Buffett sings about the visitors scoring on the home team’s ice. the visitors scored 5 times on the home team’s ice last night. UGH! Well, it’s time to start worrying again. Cardinals ace pitcher, Adam Wainwright, got sent back to St. Louis because of a stomach discomfort. These teams never really tell you what’s going on until they have to, so, I sure hope the Cardinals GM, still has the Phillies GM’s phone number so he can inquire about Cole Hammels. Milky Chance is playing their song: Flashed junk Mind on the iPod right now. that’s a head bopping song for sure! I sure hope someone doesn’t tell me that song is 10 years old like they did when I thought I had a “new song” from the Killers. Well, James Bond or Dean Martin didn’t sleep well last night again, I wish I could figure out what causes the difference between a good night’s sleep and a not so good night. So, it’s time to get out of your hair today. I hope you have a Wonderful Wednesday!Chuck Butler Managing Director EverBank Global Markets
In This Issue. * Focus on jobs * Loonie on top * Asian Infrastructure Investment Bank * Dollar higher in early trading And Now. Today’s A Pfennig For Your Thoughts. Final Revisions. Good day. And welcome to Friday morning. It’s going to be a collaborative effort this morning, so in keeping with tradition, let’s kick off this TGIF with Frank Trotter. “Saint Louis, Missouri – Empathetic Sales. My corporate MacBook Air has been barking a warning at me for some time now. “Service Battery” says the ominous message. Clicking through doesn’t add much more in terms of explanation other than get thee to an Apple Store. Suspecting the urgency I have now procrastinated over a year before taking action but on Thursday headed over to the Galleria Mall that I can see from my office at my appointed time with the Genius Bar. Waiting for a sufficiently genius person to be ready I listened to the conversations around me. “Yah, that happens to me too.” “I really hate it when it does that.” “Oh man, I get that all the time.” We had studied Apple’s “empathetic sales” technique a couple years ago and found it fascinating. The sales team can draw a client or prospect in as they feel like they are on your side of the table all the time, but of course there is a gentle nudge in the desired direction of a sale along the way. Excellent technique that is well executed. “Service Battery” as suspected turns out to be code for “Replace Battery” – very empathetic indeed. The sales team at the store has to be, unlike the Federal Reserve any more, patient. Spending even a little time in earshot of inquiries can ruin one’s faith in the average level of education, or possibly capacity to be educated. On a regular basis we also worry about financial education. A Wall Street Journal article on Wednesday, “A Three-Question Test of Financial Literacy” (1) shocked me and underlined this concern. If you have access though the paywall take a look at the link you find after reading all of today’s Pfennig. Bottom line even the very basics are not well understood, and as the professor conducting the research notes: “Even well-educated people are not necessarily savvy about money . . “ Recently we have commented that even significant formal economic education does not guarantee, or even suggest, good analysis or forward guidance. Decades in the markets clearly prove to me that short term forecasting is no better than visiting the oracle, be they in Omaha or on a remote mountain in Tibet. I have recounted before my recollection that a 1980’s study of the basic forecasting ability of nationally recognized market analysts over a serious enough period of time showed less than coin-toss accuracy (but at quite a higher cost). The gyrations in today’s market amplify this point. In an orderly and somewhat readable economy markets move as a progression, with volatility, towards a conclusion. We’re seeing what would be considered random movements if viewed outside of the news cycle that react and correct wildly to news and rumor alike.” Thanks again, Frank. Speaking of volatility, the lower dollar from yesterday morning gave way once US trading went into full swing as the better than expected weekly jobs number was enough to push the dollar broadly higher by the time the dust settled. Initial claims fell to a five week low of 282k and continuing claims followed up with a weekly improvement of its own. As Chris mentioned yesterday, stronger labor market numbers should continue to have a positive impact on the dollar, so the upward move was justified from that perspective. We also had the March Markit PMI service sector report increase at the fastest pace since September. Chris Williamson of Markit, the firm who produced the report, said the US economy is showing signs of regaining momentum after the slowdown seen at the turn of the year. The flash PMI surveys are registering faster growth of both service sector and factory activity at the end of the first quarter, as well as ongoing strong hiring. While more than a handful of economic data over the past couple of months has been less than impressive, the labor market continues to be the guiding light for both the Fed and the financial markets. I still have a tough time looking at the string of recent data and extrapolating that into a rate hike sooner than later, but I’ve seen more than one economist keeping the light on for a June liftoff. Today, we get the final revision to 4th quarter GDP and the U. of Michigan consumer confidence report for March, both of which are expected to show slight improvements. Next week is shaping up to be on the active side, but the March jobs report on Friday should hold the hammer. As I mentioned, the dollar was able to gain back some ground yesterday as the better labor report and hawkish talk from another Fed member was enough to stir the drink of the dollar bulls and encourage thoughts that a rate hike is nearly upon us. Dennis Lockhart, the Atlanta Fed President, expressed his view the economy can handle a higher interest rate environment and that June is still in play for such action. As a result, most of the currencies finished the day in negative territory, however, the Canadian dollar was able to remain in the black as comments from Bank of Canada governor Poloz minimized the chances of another rate cut in the near term. He expressed comfort in the fact that the economy should be able to show recovery by the end of summer and the initial shock of lower oil prices have subsided. If you recall, he took the markets by surprise in January with a rate cut but it’s looking more promising that was a one and done scenario. Other than that, the Brazilian real, Japanese yen, Singapore dollar, and Chinese renminbi were able to resist the forces of a stronger dollar. Speaking of the Chinese currency, Chris Gaffney sent me some commentary to share with you today, so here you go: “China’s new Asian Infrastructure Investment Bank (AIIB) has been in the news a lot lately, and I’ve been meaning to discuss China’s answer to the World Bank for the past few days but have just run out of time each morning. The AIIB will have an initial capital of $50 billion which may be doubled and China, who is organizing the bank, will be the largest shareholder. AIIB has been in the news lately because many nations have been joining on as ‘founding members’. The UK, Germany, Italy, Australia and Canada are some of the non-Asian countries who have applied for membership. These non-Asian members will be restricted to just 25% of the shares in order to keep the control centered in Asia (and particularly in the hands of the Chinese). Noticeably absent is the US who has elected to stay away from the new global lender. The US doesn’t like funding a bank for which it will have little if any control – unlike the World Bank and IMF where the US practices more control. The organization and introduction of this new bank is another example of China flexing their financial power and at the same time showing some willingness to work with others in supporting infrastructure projects throughout the region. In a separate announcement, I read that Canada’s export agency has signed a deal with China’s largest bank to promote the use of the Chinese Renminbi (Yuan) as a settlement currency for trade related transactions. An official of the Canadian agency, Export Development Canada said that they would be ‘looking for ways to make the transactional aspect of Canadian and Chinese trade a little less cumbersome. As Chuck has pointed out in the past, China continues to sign ‘Swap Agreements’ with several of their trading partners which cut the use of US dollars out of trade financing. Officials in Toronto launched the first Chinese Renminbi trading hub in North America on Monday. Toronto joins Paris, London, Moscow, Singapore, Tokyo, Seoul and Sydney which also have trading hubs. Again, the purpose of these hubs is to make it easier for businesses to trade directly in Chinese currency, negating the use of the US$ in trade deals. Just another step by China in their slow and steady path toward making the Chinese Renminbi a true challenge to the US dollar as the global reserve currency.” Other than that, Mexico’s central bank kept interest rates on hold and Swiss National Bank board member Fritz Zurbruegg said in a speech that the SNB will continue to take account of the exchange rate situation in formulating its monetary policy and will intervene in the foreign exchange market as necessary in order to influence monetary conditions. He went on to say the currency is overvalued and should weaken over time. This isn’t the official stance of the SNB, but its still something to keep an eye on. As I came in this morning, the dollar is marginally higher with most currencies teetering between fractional gains and losses. Its been pretty quiet in early trading so far and looks to carry over into the US session unless we see some large revisions to the data release this morning. We had French consumer confidence increase to the highest level since November 2010 but that wasn’t enough to offset a reiteration by Draghi that he pledges to push QE efforts into high gear and hit the goal of a monthly 60 billion euro target. Other than that, we don’t have much going on this morning. I’ll let Chuck take us over the finish line and officially kick off the weekend: “So, there I was going through stuff on Google+ yesterday, and I came across something that was already in my email box! Of course it was an article on the Daily Reckoning www.dailyreckoning.com and it was written by James Rickards. Mr. Rickards goes through 6 Major Flaws in the Fed’s Economic Model. All of them made abundant sense to me, so if you want to see the entire list, I would hit the link above, and find it. What I have singled out is simply one of the items that I’ll repeat here. This one is important folks, so I’ll type real slow in case you want to take your time reading it! HA! “Yellen’s zero interest rate policy constitutes massive theft from savers. Applying a normalized interest rate of about 2% to the entire savings pool in the U.S. banking system compared to the actual rate of zero, reveals a $400 Billion per year wealth transfer from savers to the banks from the zero rates. This has continued for more than 5 years, so the cumulative subsidy to the banking system at the expense of everyday Americans is now over $2 Trillion. This hurts investment, penalizes savers, and forces retirees into inappropriate risk investments such as the stock market. Yellen supports this bank subsidy and theft from the savers.” – James Rickards Chuck again. Yes, I’ve told you all for years that the ZIRP (zero interest rate policy) was hurting the savers, and senior citizens that depend on interest income to keep them from dipping into their principal. But it really didn’t sink in until you put some dollars to the talk. Thanks James. and thanks DR.” That does it for today so have a great weekend!Currencies today 3/27/15. American Style: A$ .7995, kiwi .7574, C$ .8008, euro 1.0857, sterling 1.4898, Swiss $ 1.0368, . European Style: rand 11.9992, krone 7.9596, SEK 8.5950, forint 276.62, zloty 3.7692, koruna 25.343, RUB 57.2680, yen 119.20, sing 1.3694, HKD 7.7534, INR 62.4442, China 6.1397, pesos 15.1280, BRL 3.1903, Dollar Index 97.49, Oil $50.70, 10-year 1.98%, Silver $17.09, Platinum $1,146.05, Palladium $760.00, and Gold. $1,201.40 1 – “A Three-Question Test of Financial Literacy”, Wall Street Journal, 25-March-2015 http://blogs.wsj.com/totalreturn/2015/03/25/a-three-question-test-of-financial-literacy/?mod=e2gp Mike Meyer Vice President EverBank World Markets
Recommended Links Our deal with Chris works as follows… Chris will pick stocks using his own methods. We will follow. Later this month, we’ll start investing $5 million of our family money in Chris’s recommendations. Always in Doubt We had mixed feelings about it… We have great faith in Chris. But we don’t like investing in stocks. When you “invest” in a ranch in Argentina, you make no money… but at least you enjoy yourself. You meet new and interesting people. You confront new challenges. You learn things you didn’t know. Stocks give us no such pleasure. Never once has a stock said so much as “hello,” no matter how much money we put into it. Also, we believe this is the worst time to invest in the stock market in the last eight years – for the many reasons we’ve discussed in the Diary. For the record, we still expect U.S. stocks to perform badly in 2016… and beyond. But the guiding principle of the Diary is doubt… We doubt that this is a good time to buy stocks. We doubt that the Fed’s managed currency system will survive. We doubt that our “Deep State” government serves us well. But we also doubt that God tells us His plan for the stock market. Chris has made a lot of money for his readers over the last decade – through good times and bad. Our investments – heavy with gold, cash, and real estate – did less well. The next decade could go either way. We’ll stick with our big positions in gold, cash, and real estate. But… bowing to doubt… we’ll hedge our bets, too, with stocks. — Editor’s note: In today’s Dispatch, we’re sharing a valuable (but surprising) essay from Agora founder Bill Bonner. In it, Bill explains why he committed $5 million of his family trust’s money to one of his top analyst’s stock market strategy. If you know Bill, you know why this is surprising. In short, Bill doesn’t trust the stock market. He typically invests the bulk of his net worth in gold, real estate, and private businesses. But for reasons he explains below, Bill made a deal with star analyst Chris Mayer… Bill originally wrote this essay on April 18, 2016, in Bill Bonner’s Diary. A Remarkable Performance As you may know, we just made a deal with longtime friend and star analyst Chris Mayer. [Watch Bill explain why here.] I say “star” because, over the past 10 years, Chris’s recommended portfolio has outperformed the best billionaire money managers. We had an independent CPA examine the track record of Chris’s Capital & Crisis newsletter (which he no longer edits). Turns out, if you invested $100,000 in Chris’s advice in 2004, you would have been sitting on over $480,000 a decade later. As you can see below, against even the best investors in the world – guys like Warren Buffett, Carl Icahn, and David Einhorn – that performance is remarkable. – For retirees who want to become “Income Millionaires” This week only: The Palm Beach team of experts is putting on a free Roundtable to reveal a revolutionary income program five years in the making. You’ll discover how to add 2-5 income streams… find yields as high as 24%… and potentially turn every $50,000 into as much as $1 million during retirement. Register now, and claim a free gift. This Shocking “September Surprise” Could END Hillary’s Chances Agora Financial has evidence—from an ex-advisor to the CIA—that a single event in September could derail any chance Hillary ever had of beating Donald Trump. It’s NOT another ISIS attack. It’s NOT another email scandal or finding out about Benghazi. This is a planned financial announcement that could turn millions of Americans against the Obama legacy… and against Hillary—the one candidate who clings to it. Get a sneak peak of this announcement now, by clicking this link… A “Good” Business? Some things you do for profit. Some you do for fun. Some things you do because you don’t know any better. And some you do just for the hell of it… We’re not sure which category to put this in. If Chris does anywhere near as well as he has for the last 10 years, we will say we did it for the money. If we lose money, we’ll say we were right about stocks all along. Like everyone else, we’ve read many books on investing. We’ve followed the debates between proponents of the efficient market hypothesis (who claim you can’t make outsized returns as an investor without taking outsized risks) and their critics. We’ve studied the evidence and looked at the results. But all of this “book learning” has been overshadowed by what we have learned from running our own business. In the stock market, you make money by finding good businesses… and sticking with them. The problem is, it’s hard to know what a good business is. Coca-Cola is a good business. It has a product that costs little to make. And people like it. Many are almost addicted to it. But there are plenty of carbonated drinks around; new ones come along every day. So it is not obvious why Coke should be a winner. That’s why people usually can’t tell how good a business is, even when they are right in the middle of it. In 1888, for example, Asa Candler bought the formula for Coca-Cola from its inventor, John Pemberton, and other shareholders for just $550. And in 1961, the McDonald brothers – Richard and Maurice – sold their fast-food sandwich shops to Ray Kroc for $2.7 million. And in 1976, the third founding partner of Apple, Ronald Wayne, sold his 10% stake in the company (today worth over $62 billion) for just $800. If founders and owners don’t know what their businesses are worth, how can outside investors? Buffett’s Big Bet Most of the time, the answer is: They can’t. Eight years ago, Warren Buffett bet $1 million that a group of hedge funds chosen by New York City-based money management firm Protégé Partners would underperform the S&P 500 over the following 10 years. This bet still has two years to run. But so far, Buffett is winning by a large margin. The S&P 500 is up by about 65%… versus the roughly 22% average gain for the five hedge funds Protégé Partners selected. If the hotshots running hedge funds can’t beat the indexes, who can? All we know for sure is that Chris Mayer has. He’s beaten the big money managers, and the S&P 500, over the last 10 years – by a wide margin. Will he do so over the next 10 years? As the SEC reminds us, past performance is no guarantee of future performance. Still, it’s all we have to go on. Tilting the Odds One of the things Chris does to shift the odds in his favor: He pays attention to the people running the business. Again, from our own experience, there are a lot of people running businesses who are more interested in their careers and their compensation than the health of the business itself. Especially now… and thanks largely to the corruption of the entire system wrought by today’s credit-based money… managers and investors tend to be very short-term oriented. But real growth and real profits are rarely produced quickly. Businesses are best understood as learning, not money-making, machines. The ones that succeed are the ones that learn more quickly – at low cost… by trial and error… over a long time. Try to goose up profits in the short run and, most often, you cut off long-term learning. That’s why companies bought and sold by professional investors, funds, or private equity firms are almost always a disaster. These predators strip out real assets, load up the company with debt, and then try to sell the husk of the company to unsuspecting investors. That’s why Chris favors businesses where the operator has his heart in it. He will do what he has to do to help his business succeed. Again, it’s no guarantee. But it’s a small edge. Chris (who started his career as a loan officer in a bank) also spends a long time studying company reports and adding up the numbers. Often, he finds they don’t add up at all. This doesn’t necessarily put him onto winners… but it helps him eliminate the losers. We’ve known Chris for years. We trust him to pick stocks as much as I trust anyone. Does this mean we will make money following his advice? We don’t know. But we’re going to find out. And you are, too… We’re making our own bet – five times as big as Warren’s. We’re betting that Chris can not only beat the S&P 500… but also that he can keep us from losing a lot of money, even if the market turns down. Regards, Bill Editor’s note: Chris has been one of the best stock pickers in our industry for more than a decade. But that’s only one of the reasons why Bill has decided to follow Chris’s recommendations. Bill has prepared a special online presentation to explain why he’s committing $5 million of his own family money to Chris’s strategy… and how you can invest alongside him. Watch it here now.
If you wanted to avoid the wind and outdoors on Easter Sunday, there was an option at the Children’s Hands On Museum.From 9 a.m. to 4:30 p.m., children could get in the Easter spirit by playing games that help stimulate the brain, but were also on theme with Easter. There was not, however, any egg hunts or Easter Bunnies. Instead, CHOM encouraged a different way of learning.“You know you’re going to get a ton of the decorating Easter eggs and doing the Easter hunt and they’re going to get all of that,” Kimberly Crabbe, CHOM’s public programs coordinator, said. “So we want to, we’re going to incorporate a way to have them learn and visit us at CHOM and like, you know, see the museum. But, for every holiday, we want to incorporate that learning.”CHOM has different themed events going on every Saturday, so check them out at their website for fun opportunities for learning on the weekends.