Inflation Fighters Emerge


* International Investments – Inflation Fighters Emerge
* Natural Health Tip – Inflation is Wild
* Ecuador – Quinoa Fights Inflation

We saw in last Thursday’s message that May 2006 was the second worst month for emerging markets this decade. Markets fell overall 10.5%. You also saw that Keppler’s Top Value Emerging Markets did not drop at all despite this drop.

Later this week you’ll see my portfolio and see that I am adding emerging markets. I think the market is wrong. Here are some reasons why.

First, fundamentally globalization of commerce of markets and of life is the trend. Emerging markets will emerge.

Second, emerging markets are safer than major markets. These new growing markets are the ones with the real opportunity and safety in the future. This is reality. Investors though look back instead of ahead and think that the aging markets which are bloated with debt, bureaucracy, underfunded pensions, medical crisis and unhealthy, aging, overweight populations are the safe places.

Third, positive carry will remain. One fuel in the previous emerging market boom was low interest Japanese yen, Swiss franc and US dollar loans that were invested into emerging markets. One reason for the recent crash is the markets’ belief that this liquidity will dry up. I have been writing about Borrow Low- Deposit High for over 20 years. There are always some currency differences and emerging markets always pay higher yields. Until market risk equalizes globally (probably not in our lifetimes), there will be distortions in interest rates and hence positive carry. Back in the early 90s, we were borrowing yen at 4.75% to invest in Mexican pesos at 18%. Earlier we were borrowing Swiss francs at almost zero percent to invest in US dollars at 18%!

Finally and perhaps most important, inflation is rampant in the US and I believe it has just begun. This will push US dollar interest rates high and make business more attractive in emerging countries. More US businesses and Yankee ingenuity will move abroad and help the emerging markets grow.

So let’s look again at emerging markets Here are Keppler’s current value rankings of these markets:

Emerging Markets
Current Ratings & Valuation Characteristics

  Price to Book Value Price to Cash Flow Price to Earnings Dividend Yield Cash Flow Return on Equity Return on Equity
BUY CANDIDATES AVE. (Top Value) 2.05 7.9 13.2 2.72 25.9 15.5
Brazil 2.30 6.7 10.7 3.33 34.2 21.6
China 2.24 7.6 14.0 2.44 29.6 15.9
Korea 1.68 7.0 11.3 1.77 23.9 14.9
Malaysia 1.88 9.6 15.2 2.77 19.5 12.3
Philippines 2.12 8.2 15.5 2.30 26.0 13.7
Russia 2.52 10.5 14.7 1.60 24.0 17.2
Taiwan 1.91 10.2 18.5 3.81 18.7 10.3
Thailand 2.09 6.7 9.7 3.88 31.1 21.5
Turkey 1.95 6.9 13.7 2.61 28.1 14.2
 
SELL CANDIDATES AVE. (Low Value) 3.42 11.2 16.7 2.48 30.5 20.5
Argentina 3.16 8.4 14.0 1.19 37.4 22.6
Egypt 4.47 13.8 20.5 1.48 32.4 21.8
India 4.2 15.9 20.1 1.26 26.4 20.9
Indonesia 3.26 9.4 14.4 2.84 34.6 22.7
Jordan 3.31 17.3 32.2 2.62 19.1 10.3
Mexico 3.00 9.7 14.2 1.53 31.0 21.0
Morocco 3.42 13.1 23.7 3.76 26.1 14.5
Pakistan 3.04 8.2 10.8 5.13 37.1 28.1
South Africa 3.46 12.1 15.6 2.50 28.7 22.1
 
NEUTRALLY RATED AVE. 2.25 9.4 15.0 3.42 24.0 15.0
Chile 1.86 11.0 21.9 3.02 16.8 8.5
Colombia 2.93 26.4 22.8 1.94 11.1 12.8
Czech Republic 2.23 9.1 20.9 2.46 24.6 10.7
Hungary 2.79 6.9 11.7 2.83 40.5 23.9
Israel 2.66 14.4 17.2 2.09 18.4 15.4
Peru 2.93 6.6 14.4 3.21 36.8 16.7
Poland 2.42 6.6 14.4 3.21 36.8 16.7
Sri Lanka 2.13 22.8 23.8 1.83 9.3 8.9
Venezuela 1.40 5.2 8.8 7.12 27.1 16.0

Learn more about fighting inflation by investing in emerging currencies, gold, silver, Ecuador, import-export, overseas markets and more. Join Merri, Thomas Fischer from Copenhagen and Steve from Ecuador and me at our next International Business and Investing Made EZ course in North Carolina. Review where to invest and do business now and learn which markets and currencies may be strong in the year ahead. Learn more about Ecuador import and export from Steve. Our May course was overbooked and the September up date is coming along. Our free accommodations here on the farm are reserved on a first come first served basis so do not delay! Go to garyascott.com/catalog/ibeznc.

Natural Health Tip – Inflation is Wild

Inflation is natural. Give any species a chance and it will run wild. This year we have an explosion of wild blackberries at the farm.

Sometime each day this time of year I try to amble to the garden. When the wild berries ripen, I’ll stop and pick (fresh wild black raspberries, blackberries and strawberries). They are especially sweet off the vine covered in dew when a morning sun is rising over the ridge. What a morning start! Right now there is an explosion of white flowers that smell sweet as honeysuckle.

In the garden I’ll weed a bit or pick vegetables for the day when they are ripe. Along with the berries, the garden bristles with onions, potatoes, sweet peppers, tomatoes, beans, peas, corn, several kinds of lettuce and greens, spinach, cauliflower, brussel sprouts, broccoli, sunflowers, cucumbers, zucchini, gourds, numerous squashes and a variety of pumpkins from pie makers to large French ridges that will make humongous Jack O Lanterns this fall.

This week the first berries of the year to ripen here have begun, wild strawberries.

Berries are especially important because they really help reduce over acidity. We saw in yesterday’s message why our diets should promote alkalinity in our bodies.

There is another important nutritional factor that berries provide. They are sweet delicious but are slow burning carbohydrates. We have learned over the years the importance of keeping our protein carbohydrate-fat balance at about 3 grams of carbohydrate to two grams of protein to one gram of fat. (a good book on this subject is “Mastering the Zone” by Barry Sears). Berries help do this by providing tasty, colorful bulk and texture that do not throw the carb balance out of whack.

Berries can be used in some zesty recipes to give a protein balanced, alkaline inducing combination. Here is one such recipe.

Wild Strawberry Pancakes

We also do not want to miss breakfast as starting the day with the balance and amount of carbohydrates, protein and fat is important.

Remember a good balance is three grams of carbs for each two grams of protein and one gram of fat.

One way Merri and I accomplish this in the morning is to substitute quinoa protein powder for part of the flour we cook with in waffles and pancakes.

We make our own quinoa powder by simply buying organic quinoa in the health food store (or bringing it back from its origin in Ecuador) and blending it into powder.

This turns pancakes from high glycemic food into a balanced protein meal that also happens to taste lighter.

Ingredients:
Wild strawberries. (Other berries will do, however.)
A touch of lime.
A spoonful of vanilla
Half cup of flour
Half cup of quinoa protein powder
Two organic eggs
Enough milk to mix it all up to pour
A touch of olive or coconut oil ((organic preferred)

Substitute any fresh berry and add over the top. You can also add in a handful of slivered almonds (best soaked overnight) or pecan pieces.

Mix the flour, protein powder, milk, olive oil, natural sweetener together. Then spoon the mixture into the skillet frying pan or waffle iron. Cook until brown.

This creates a delicious, low calorie treat that everyone loves when we serve it here at the farm.

If you are a fresh cream addict, join the club, but use only a dollop. Organic is best.

Better still add just a touch of low fat sour cream.

P.S. We had such success with Dr. Mishra’s weekend health course on learning how to balance pH, that we asked Dr. Terry Hambrick to condense his one week August course to a long weekend instead. Terry’s course promises to be special because it will help balance your pH during the course plus show you how to keep it balanced after you leave! To enroll or for more details contact Merri at merri@littlehorsecreek.com

Ecuador – Quinoa Fights Inflation

To fight inflation economically and around the waist we have started the Quinoa Café at El Meson De las Flores. Our specialty is recipes based on quinoa, the staple Andean food and grown in our area of Cotacachi. The photo below is from one of the rooms at El Meson. Learn more at garyascott.com/catalog/elmeson.html

Join us at El Meson this July for Super Spanish. Eat in the Quinoa Café. See garyascott.com/catalog/superspanish.html

Until next message, good investing and health to you.

Gary

 


Related Artices

If you enjoyed this article "Inflation Fighters Emerge" you may find these related articles of interest too:

    None Found