Do Nothing in Shares Now


Many readers are writing,  “Should I buy or sell shares?”

I cannot provide individual investment advice, but here is what I am doing… nothing. Nada.  Niet.  I am taking no action now in the markets at this time.

I am working like crazy researching and studying for our business. I am scouring potential real estate deals… but no stock investing action yet.

If you have a choice… do nothing!   Forces are balanced.  Shares could go down.  Yet they may also rise.   Anyone who says he or she knows what will happen is guessing.

A wait and see approach stops overreacting and keeps trading costs down.

What you can be sure of is that markets will not suddenly correct. You will not lose some great upside potential.   Yes, markets may drop further but we’ll see in upcoming messages that a slow recovery is more likely.

If there is a drop… just wait… if you can and catch the recovery when it comes.

We have too much potentiality right now and we were reminded of this fact as Blaine Watson concluded his Beyond Logic course yesterday.

Here is Blaine teaching the course.

logical-investing

Our coffee breaks were as always healthy… herbal tea.  Here is Consuelo serving fresh ground coconut balls, hand dipped by our staff in organic chocolate.

beyond-logic-investing

In the course,  we looked at the importance of adding intuition to investing with an example of how our hound dog, Ma, has the potential to destroy the world.

Here’s how.

#1: Imagine if Ma poops on our front step. (She actually would never do this … but this is an example).

#2: An investor is hurrying to make an important investment and steps in the poop. He rushes to the shoe shine man and forgets to make his investment.

#3:  A banker who expected the investment thereby goes broke.

#4: The country of the bank now has to bailout the bank.

#5: The president of that country has to sign a bill to bailout that bank.

#6: Someone is so upset by the bailout they assassinate that president.

#7: The assassination starts a war.

#8: The war creates a nuclear exchange that destroys the world.

This is how the world works… in seemingly disconnected, non linear ways.

There are too many dogs and too much instability in markets right now!

We were reminded  of the importance of waiting to see what happens in our non linear world because the best laid plans are usually altered dramatically by small unexpected events.

We learned in Blaine’s course that true wealth comes more easily if you blend intuition with your logic because the non-linear dynamics within us tap into infinite knowledge and make connections our reasoning process cannot always fathom.

An example of how chaos theory works can be seen by how our well being, lifestyle and wealth today were dramatically affected by a Dutch Man of War raid on one Portuguese cargo ship in the Malacca Straits in 1604.

This is no example. This is true.

The attack caused such an international fuss that the Dutch hired a man named DeGroot, to write a legal opinion to justify their actions. He created the concept of the Open Seas, stating they were free and no nation could control them (which the Portuguese had been doing).

DeGroot however carried on and wrote international law. This created many concepts about juries and laws that a Frenchman, Blaise Pascal, used to develop a system that explained how juries would act.

This caused trouble.

His thoughts on probability were frowned on by the church which was not a good thing in those days.

He became associated with a freedom of consciousness group, the Jansenists.

The Church in France attacked them seriously. They had to flee, hide or die.

One way Jansenists hid was in monasteries where they pledged silence and could only communicate with hand signals.

One French Jansenist monk, Lipet, started a sign language school that became so successful it eventually gained endorsement by the Pope.

Then a rich American, Samuel Morse’s partner, Amos Kendall, became interested and gave enough money to start Gallaudet College, the first university to give degrees to deaf students.

At this college a Scottish elocution teacher learned that he could teach deaf people to make sounds using this sign language.

While this Scotsman’s son was teaching sign language to deaf people in Boston, he came across a French invention that allowed deaf people to speak down a horn.This caused a membrane to vibrate and traced a wiggly line on smoked glass, allowing the deaf to see the wave created by the sound!

The son suddenly had another idea. If one could speak down a horn and get a metal membrane to vibrate a bit of iron in and out of a copper coil attached to a battery, could it be possible to generate a wavy bit of electricity that would go down a line?  This concept he thought, would cause the reverse to happen at the other end and reproduce the original sound.

This son’s name, of course, was Alexander Graham Bell and his thoughts created the telephone.

Non-linear dynamics and those Dutch pirates created the telephone which dramatically alters our lifestyles today.

But the pirate raid does not end its influence there. Those wiggly lines on smoked glass were turned into another phonetic code called shorthand by a devoted pacifist, Issac Pittman.

He tried to use his phonetic short hand as a universal language to improve global communication and understanding. The idea created such a wave of enthusiasm that some governments gave grants for scientific studies of the idea.

One grant led to research studied by a fellow named Reynolds, who took this information and worked out formulas known as “Plates Reynolds Numbers”.

These numbers were deeply studied by two brothers who ran a bicycle shop in North Carolina.

Their names?

Orville and Wilbur Wright.

They used “Plates Reynolds Numbers” to fashion their airplane which was the first in flight.

That’s non-linear dynamics!

This is why we need intuition to help assure our wealth.

Things do and will change in ways we cannot logically figure out. Yet we can indeed know and feel what is coming through our intuition.

After the course we had an indigenous dancer in to allow everyone the pleasure of local dancing.

investing-in-dance

Pretty soon others joined in!  Here is a shot I took from the suite above, as the group danced in the courtyard.

beyond-logic-investing

Speaking of intuition, I am pleased to announce that the beach condo Vistazul project is now nearly sold out. There may be a couple of units left but if so there is not much.

Just a year ago, despite a growing global economic downturn I felt that this project would be a hot…so while most real estate projects can’t move any property… Vistazul sold well. and I am pleased that we bought early.

More exciting is the fact that the first families are moving in so rather than talk about the buildings I would like to feature some of the people who are moving there.

The best place to start is with Vistazul’s first family, Kjetil and Jessica Haugan. Here they are in the lobby of the Palmazul hotel and clubhouse with their daughters, Ingrid Atahala and Nina Alexandra. (Vistazul condos are in the background).

ecuador-beach-family

Guess where they got the names of the Galapagos cruise boats that one of the businesses they started built, the Atahala and Nina?

Kjetil and Jessica have started a travel business, Spanish schools, a company that runs a Galapagos tour agency and have the two boats above that offer luxury Galapagos cruises.

Kjetil is from Norway and after managing part of the Atlanta Olympic Village and living in Savanah, Georgia, he moved to Ecuador 14 years ago.  Merri and I have known Kjetil since he arrived and upcoming messages will share some stories of how he has helped readers on the coast when they were in trouble.

Until next message, may your intuition help guide you to the enormous opportunity this current economic downturn has created.

Gary


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