Click twice on photo to enlarge. See an explanation of this Jyske asset allocation below.
JGAM’s analyst Bank Credit Analyst is a Canadian company and it coined the phrase “economic-tug-of-war-environment” so it is not surprising to find an article in the Canadian paper Chronical Herald that we should ponder.
Here is an excerpt from 2012 article “Economic tug of war” by Keith Dicker says: In Berlin in 1922, Alia Schmidt paid three German marks for a loaf of bread. Six months later, the same loaf cost her 700 marks. The German decision to print money caused inflation to skyrocket.
In Tokyo in 1994, Makishi Satou paid 217 Japanese yen for a McDonald’s hamburger. Eighteen years later, Satou is still enjoying hamburgers, yet he is only paying 216 Japanese yen for the same delicacy.
The Japanese decision to print money resulted in zero inflation. Yet, Satou and others are not at all happy with their money-printing experience and the subsequent 77 per cent decline in their stock market and the 90 pre cent fall in their property market.
Today, the U.S., Europe, Japan and Britain are all printing money and it is fact that only three scenarios are possible:
1) Printing money has absolutely no impact on prices rising or falling.
2) Printing money results in a return to the 1922 German experience.
3) Printing money results in a return to the modern-day Japan experience.
In other words, no one knows quite where to invest and the so called safe investments (such as US and euro bonds) that pay almost nothing might not be safe at all. However there is a way to increase profits and safety at the same time through leveraged diversification as is described below.
Thomas wrote the JGAM monthly portfolio update yesterday.
Thomas Fischer chatting with a course delegate during a visit to our home for lunch. Delegates learn a lot during the breaks, meals and get togethers. Click twice on photo to enlarge.
Here are excerpts from the monthly analysis that Thomas wrote: At our Investment Committee meeting in June we made no new investment decisions, as we felt comfortable with our existing asset allocation and increased exposure to large dividend paying stocks. We felt certain that in the current fragile economic environment the central banks would come to the rescue.
Thursday 5 July the central banks delivered when the European Central Bank (ECB), People´s Bank of China (PBoC) and the Danish National Bank (DNB) all lowered interest rates. Bank of England (BoE) did not cut interest rates , already at the lowest level in the bank´s history. However the bank injected another £ 50 billion into the economy taking the total to £375 billion.
We are now entering the third quarter and as coined by our research partner Bank Credit Analyst (BCA) a tug-of-war environment dominating the world economy and financial markets. On the one side the eurozone debt crisis and weak growth will continue to cast shadows over the world economy, and on the other side falling energy costs and monetary reflation will be accommodative for global growth and thereby encourage risk taking.
The negative tug on the world economy is three fold. A never ending eurozone debt crisis, a slowing recovery process in the US and China experiencing a slump in exports and manufacturing. The main culprit for the dire situation is the eurozone debt crisis and haphazard response from the European politicians. We have seen one EU meeting after the next and still with no clear cut solution to the debt problem. It has taken such a long time to deal with the issues at hand, that the crisis has now passed the point where one country (read: Germany) can provide sufficient funds. The size of the German economy is euro (EUR) 2.6 trillion whereas the total debt of Italy and Spain alone is EUR 2.8 trillion. More meetings will follow before a political compromise can be achieved, but if/when it happens it will be bullish for risky assets. In the US the recovery is stalling, as the household sector is paying down debt, whilst at the same time the corporate sector is increasing its savings. The US is furthermore heading toward the so called “fiscal cliff” and increased political polarization, which will not be conducive for the overall economy. Chinese economy is also facing headwinds with falling exports, manufacturing and domestic consumption.
The positive tug on the world economy is being provided by falling energy costs, declining interest rates and monetary reflation. The world economy is still balancing on a knife’s edge, but most central bankers seem to have learned a lesson from Japan and are adamant in their hyper accommodative stance and fight against deflation. We will probably see more aggressive monetary reflation in the coming months and this should help steady the world economy.
We remain in the positive camp and expect equities to outperform bonds even though the eurozone will probably soften overall growth in the world economy. The flare-up of the sovereign debt issues have also led to a large divergence in the equity markets in the second quarter. The eurozone equity market dropped between 10-18% whereas the S&P 500 only was down 3%. Going forward we still expect diverging markets and will focus our attention on markets with the best overall growth prospects. According to BCA the stock markets of the US, the UK and Switzerland should do better than the average index. We already hold several equity positions in these countries, which has been a major factor in our good performance year to date and strong benchmark outperformance.
We are of course still dealing with a world that is risky and we also expect volatility going forward. However at current valuations we still prefer stocks to bonds and will keep our current asset allocation. According to BCA equity premiums today are well above historical norms and based on past experience this should lead to superior performance of stocks compared to bonds.
Explanation of Asset Allocation
Fixed income: JGAM is keeping an underweight position, favoring bonds with short duration.
Equities: JGAM is keeping a neutral to overweight position, favoring large dividend paying companies.
Alternatives: JGAM is keeping a neutral position of holdings in gold and oil as protective investments.
Cash: JGAM has a neutral position.
Loan mix: All loans for leverage remain unchanged with 100% of the loans in euro.
Leverage: The gearing is kept at a level below maximum. There is no leverage on the low risk portfolio, 1 times leverage on the medium risk and 2 times leverage on the high risk portfolio.
Here is the Rub
The economic mess that prevails now has been created by too much debt already. Part of the entire global instability is caused by the never ending eurozone debt crisis. A debt crisis is caused by too much debt. Usually the solution to too much debt is not more debt. However belt tightening is being resisted and creates political and social tensions. Governments do not know what else to do but lend more. This makes all government debt dangerous and leads to currency volatility. There is no place to hide… so one has to diversify into several currencies. This diversification can be enhanced by regularly adding extra amounts of currencies that look temporarily strong and borrowing currencies that look temporarily weak.
This is what JGAM does with its forex portfolio.
Forex Portfolio
This message focuses on just the JGAM Managed Forex Portfolio
JGAMs forex portfolio reveiw. Click twice on photo to enlarge.
The JGAM managed forex portfolios help us during tug of wars because they are very different from the typical high leverage forex trading that is often leveraged 10 or 20 times.
There are three main differences between this type of portfolio and currency speculation.
First JGAM bases its decision more on currency fundamentals rather than technical movements. Second, JGAM uses far less leverage. These two tactics allows Second JGAM to work in wider trading ranges which creates longer trading positions. This reduces risk and volatility while maximizing profit potential.
Because JGAM is looking for currencies that are seriously out of balance they will often have limited numbers of positions. Right now they have only two positions, the British pound and the euro short the US dollar. In other words JGAM is betting the the greenback will rise versus these two currencies.
JGAM is also careful to limit the amount a client has in any one position. For example the size of both current open positions is 20%. This is the percentage of the client’s available Assets Under Management (the client’s own capital plus leverage).
Example: If a client has $100,000 invested with a one time leverage the total Assets under management is $200,000 so when a position’s size is 20% the maximum position a client will have is $40,000.
A high risk investor with a $100,000 investment and four times leverage has $500,000 invested and could have at 20% a $100,000 position.
JGAM is one of the very few investment management companies that can leverage an individual client’s position with any major currency… so when the euro is weak… (as it is now) leverage is in euro. If the yen or the dollar or pound were weak, leverage could be in that currency.
Multi currency diversification and leverage are powerful combinations. In good times they create awesome returns.
In tough times… like now… leverage can help improve diversification.
Leverage is very inexpensive… less than 3% and allows a portfolio to be increased into more currencies and shares. If the increased portfolio earns more than 3% extra, added profits are gained. Plus the larger portfolio brings extra diversification which enhances the steadiness of the assets.
This is the JGAM medium risk portfolio. Click on photo twice to enlarge.
Subscribers to our Multicurrency portfolio reports can see all the JGAM portfolios and our comments at their password protected site. Click here.
One good way to gain stability in a tug-of-war global economy is to have a diversified portfolio (low, medium or high risk depending on your investment profile) and enhance that portfolio with an investment in the forex portfolio.
For more details contact Thomas Fischer at fischer@jgam.com
Non Americans contact René Mathys at mathys@jbpb.dk
Gary
Better still, meet with Merri and me and Thomas Fischer of JGAM throughout the year free as an International Club member.
Belong to the International Club
Please join Merri and me. Spread an epidemic of success… in health… wealth…. service to the community and personal fulfillment. Be infected with positive purpose…. enthusiasm… fulfillment… extra income, profits and fun.
I invite you to join the International Club 2013-2014. Save as much as $7,239 for as little as $177 a month.
As a club member you gain $7,792 of seminars, courses, online courses plus Spanish lessons and Ecuador tour discounts.
Join Merri and me for seven courses and seminars that we’ll conduct in 2013 FREE. Gain positive solutions to economic, financial and lifestyle developments.
Here are the courses you can attend at no cost.
June 14-15-16 Super Thinking Writer’s Camp, West Jefferson, NC.
August 31- Sept 1-2 Super Thinking Writer’s Camp West Jefferson, NC.
October 4-5-6 Super Thinking Writer’s Camp, West Jefferson, NC.
November 15-16-17 Super Thinking Writer’s Camp, Mt. Dora, Fl.
January 10-11-12, 2014 Super Thinking + Spanish, Mt. Dora, Fl.
February 14-15-16, 2014 Super Thinking Writer’s Camp, Mt. Dora Fl.
In addition members receive discounts on Ecuador farm tours and Spanish courses conducted by our Ateam Ecuador and Super Spanish teachers. For example Super Spanish courses that are normally $699 are $175. Ecuador real estate tours are reduced 20%.
Part of the courses we conduct are held on the New River in Ashe County, North Carolina.
New River
We’ll conduct three of the courses either at our farm or in this forest lodge.
50 delegates joined us.
The seminar in action.
After the seminar, International Club members join us at our home to talk with the speakers.
International Club members meeting in our home after a North Carolina seminar.
Four courses are in historic Mt. Dora, Florida.
Please join us this year through in Florida, and North Carolina FREE as an international club member… plus gain access to the agricultural tours and Spanish courses conducted by the Ateam Ecuador at a discount.
Super Thinking Spanish course at the historic train station in Mt. Dora.
There are many benefits of membership.
You (and a guest of your choice) can attend all eight of the seminars we have already set for 2013 plus any others we decide to conduct in the year ahead FREE.
As a club member you also receive seven online reports, courses and workshops worth $1,246 FREE.
The first of these seven online courses is “Tangled Web – How to Have an Internet Business,” normally sold at $299.
The second is our online course “Self Fulfilled – How to be a Self Publisher”, which has a $299 value. I am sending you this extra course free as I think it will help you have greater success. This is an extra $299 savings.
The third is our online course “International Business Made EZ” sold at $299.
You also receive fourth the 50 minute video by our webmaster David Cross on “How to Get Your Web Business Started”.
Your fifth course is the 50+ lesson course “How to Create your Own Website Using Sitesell” by Michelle Toole. (We are proud that this course was written by a student of our courses showing how well the 43 years of knowledge that Merri and I have accumulated and put into these programs can help you start your own global micro business.)
Sixth, you become a beta member in our newest online course “Event – Full Business – How to have a Seminar and Tour Business” currently offered at $349.
When you enroll, we’ll send you a password that makes the online courses easy to access at the Club website. You can reserve as many seminars as you desire.
Five Positive Steps
Join Merri and me as we look at positive ways to prosper during 2013. Here are five ways to gain from the forces of change that can raise havoc with many.
#1: Having your own micro business for extra earnings, freedom, fulfillment and fun.
#2: Living and prospering in lower cost countries or small towns.
#3: Multi currency investing through US brokers and bankers abroad.
#4: Commodities that rise with inflation.
#5: Good value real estate…. especially multi dimensional and agricultural property.
We have specialized for over four decades in helping our readers excel in these five inflation beating opportunities.
The big benefits of belonging to the International Club are the power of repetition, updates and international friendships. As a club member, you become friends with other members as you meet again and again.
Your first saving is on waived seminar fees for the seminars over the next year.
As you will see above and below you can attend Florida & North Carolina seminars. If you attend just two of these seminars, the $1,799 membership fee will have already created a savings for you.
Yet there is more. Much more.
International Club members meeting in West Jefferson for a reception after the North Carolina seminar.
Enough…. Enough with the Bad News.
Our 2013 mantra is BE POSITIVE in this negative world. There is nothing as valuable as rarity but we need to remember that bad news sells. This means the mainstream media has slipped into offering information with an adrenaline rush. Mayhem, murder and natural disasters. These negative events will happen…. globally. We cannot do much about this. Dwelling on insolvable negativity is not good for our health or wealth.
A recent quote from the Abraham Hicks website explains why nicely.
Continuing to tell stories of shortage only continues to contradict your desire for abundance, and you cannot have it both ways: You cannot focus upon unwanted and receive wanted. You cannot focus upon stories about money that make you feel uncomfortable and allow into your experience what makes you feel comfortable. A different story will bring different results: My thoughts are the basis for the attraction of all things that I consider to be good, which includes enough money, and health, for my comfort and joy.
Make 2013 Your Best Year Ever
What we can do is make ourselves Friendlier, More Compassionate, Happier, Stronger, More Energetic with greater intellect. The way to start is to surround ourselves with successful, friendly, compassionate, happy, stronger, smarter, positive people who think as you do.
The International Club brings together experienced, like minded souls, who take a positive view and think outside the box… in constructive, thoughtful, doable ways.
Being in the club surrounds you with successful… positive… like minded souls. This benefit alone is truly powerful stuff!
The courses you can attend free integrate Super Thinking with business and investing ideas and experience that enhance your health and wealth.
Focus on Ecuador & Smalltown USA & Canada
Learn how to create a BIG INCOME by thinking SMALL. At the seminars you meet speakers who are attorneys and real estate experts for both Ecuador and small town USA. You’ll rub shoulders with experts on global investing and pensions who can help you increase and protect your savings and pensions also how to increase the income you earn in positive ways you enjoy as you help your community.
(See a list of speakers you’ll meet at the club meetings along with other club members below).
Absorb through Osmosis
Merri and I are in our 45th year of organizing courses, seminars and newsletters about international and Super Thinking lifestyles. The importance of this sharing… by like minded souls… was reinforced when a delegate from a course sent an email that said:
My Dearest Merri and Gary, Thank you for your most gracious hospitality last weekend. I am just thrilled at being a part of your group. You and Gary were exactly as I imagined you to be, warm friendly, kind, considerate, genuine, helpful, fun, sincere, what else can I say……I felt so comfortable in your presence and learned so much in your course. I was sad to leave the farm that Sunday afternoon. You made us all feel so welcome and cared about. You were so kind to make arrangements for a ride with the other delegates from the Charlotte Airport. They were so nice to me and so helpful, by the time the weekend was over I felt like they were my long lost brothers. Monday morning we all had breakfast at the airport together and I was so sad to see them go, I was sad the weekend was over, perhaps sad is not the right word for how I was feeling perhaps Gratitude is a better way to describe it. Grateful for having the opportunity to share the weekend with such wonderful, like minded Human Beings, in the beautiful mountains of North Carolina. Thank you Merri and Gary. Thanks to you I now have new hope and a new direction to move forward in my life. I know by attending your classes and conferences that through education and due diligence I will make the right choices.
This delegate’s comments about “belonging and feeling like a brother” to the other delegates is a wonderful refrain we have heard from our readers, year after year.
24 years ago Merri and I created a way that readers can join us to be immersed in a year-long learning program through our International Club.
The ideas behind this program began all those years ago in Vienna, Austria while we were conducting a course there. One of our older delegates, had some sort of attack. The first fear was heart trouble. Several delegates took him to the hospital. Others stayed with him there. I don’t think that delegate was alone for a minute!
What impressed Merri and me was that no one asked the delegates to help this man.
The friendships of delegates sharing many courses had just grown so strong that it was a natural reaction, just as if a family member was ill. Fortunately, it was only travel fatigue and the delegate didn’t miss a session of the course!
When you join our International Club 2013 you become part of a special family. The very first member to join the club all those years ago wrote, Thank you for the enjoyable and informative courses. I am pleased to be part of your international family and look forward to continuing my education at the next course.
His feeling struck a familiar chord. It has always been one of my greatest satisfactions to see how much fun delegates have getting together, sharing information and making friendships as we learn how to improve our health and increase our wealth.
The courses draw like-minded souls. For this reason some delegates come back again and again. They come to learn, but also to be with their many friends made at the courses. When like-minded souls get together again and again to discuss a common purpose, magic happens! I can’t explain it in any other way-but it is true.
In a way our meetings are almost like family reunions. Perhaps it is getting together and reflecting on what has been said and what has been happening.
Learning with those who are also interested in the world creates thoughts that multiply the value of what we gain. This is hard to describe but results are most powerful and wonderful! This is to me is as important as the great financial benefit of attending many of our courses.
See the 2013 seminars in detail below.
We started and have continued the International Club for 24 years because there are wonderful benefits from having repeat delegates at courses. Having repeat delegates makes the whole course somehow more exciting for all. Being a repeat delegate makes it easier to make and keep wealth and to lock in the knowledge you gain. It’s an exciting lifestyle. We have fun, gain adventure, discovery and friendships and share ways to improve our health and wealth!
You can see from the schedule above a very busy schedule for 2013. Very few club members actually attend every seminar. Many attend almost all of them! Of course we hope you be with us for all of them, but even if you attend just two of the seminars, you gain considerable savings.
Another savings: Lifestyle for Two.
We want couples! As a member of the program, you are entitled to bring another person to every single course or tour. The cost for that extra person will be ZERO! You can bring whomever you wish. Bring your spouse, a friend, son or daughter, partner, accountant, adviser. You can bring the same person each time or a different person, whomever you choose to accompany you. (Accommodations and air fares relating to the courses are not included for members, delegates or their guests.)
The International Club fee of $1,799 is less than the price of two seminars.
I invite you to be a member of the International Club which allows you and your guest of your choice to attend all of these courses and tours.
Let’s prosper in these times of change. Won’t you join us in this exciting club and share Merri’s and my lifestyle for the next year? Join us at our farms and visit Ecuador. We look forward to seeing you at as many courses as possible and sharing this wonderful world of abundance and well being with you!
Gary
You can attend all of our seminar , courses online courses and more plus $1,246 of online value. Club membership is $1,799.
Become an International Club Member $1,799 annual.
Attend as many of the courses below as you desire.
June 14-15-16 Super Thinking & Writer’s Camp West Jefferson, NC.
August 31- September 1-2 Super Thinking & Writers Camp at Merrily Farms, NC.
October 4-5-6 Super Thinking & Writer’s Camp West Jefferson, NC
November 15-16-17 Super Thinking & Writer’s Camp Mt. Dora, Florida
January 10-11-12, 2014 Super Thinking + Spanish Mt. Dora, Florida
February 14-15-16, 2014 Super Thinking & Writer’s Camp Mt. Dora, Florida
In additional Super Spanish courses will be scheduled in Canada, Mexico. and the US throughout the year.
(Dates subject to change).
Join us in 2013 and learn how to take advantage of the fact that the Sun Always Shines Somewhere
Yes, I want to become an International Club Member.
