Tag Archive | "pension"

Who Wants Old People Penniless

“No one wants to see old, poor people penniless in retirement”.  Or do they?

The quote above from a recent New York Times article highlights a growing problem for anyone who is dependent, (or plans to be) on a pension.

Here are some excerpts from that article: (bolds are mine)

Pension plans across the nation are facing shortfalls.  The looming collapse of the multi-employer pension system is significant given the sheer number of people affected and the potential for a devastating economic ripple effect.

Retirees will lose their pension checks.  Business that owe the pensions will go bankrupt.  Unemployment will rise increasing the problem as taxes and pension contributions fall.

America’s 1,400 multi-employer plans are facing $553 billion of unfunded liabilities.  They don’t have enough to pay what they owe workers.  About a fourth of these plans face imminent insolvency, within the next 10 to 20 years.

This strain on the multi-employer pension system carries the potential annihilation of the Pension Benefit Guaranty Corporation, the government agency that insures pension plans. The P.B.G.C. said in its latest annual report that its multi-employer program is likely to run out of money by the end of the fiscal year 2025 because of the “rapid decline” in the P.B.G.C.’s financial position. In 2017, the agency paid $141 million in financial assistance to 72 multi-employer pension plans and that number is expected to rise as more plans collapse.

If the multi-employer pension plans go broke, the federal safety net created to protect retirees will not have enough money to make good on the promised benefits, leaving workers with little to no retirement benefits.

Congress must decide whether to rescue these funds with low-cost loans, force them to cut benefit payments or let the funds go bankrupt and wipe out retirees’ entire pensions.

Congress?  Really?  That great group of guys and gals on Capitol Hill?  Protecting our financial future?  Do you trust them?  Or is it better to trust yourself?

One way to protect yourself is with a small business.  Having your own business can really pay off… again and again… often by surprise.

Years ago when Merri and I lived in Naples we ran a substantial global mail order business.  Then when the children finished their higher education, we sold most of the business, left Naples and moved to the Blue Ridge and Ecuador.

We shifted to an internet only business and were intent on smelling the roses a bit more.   This did not happen!  Our small overseas business took off again without even trying!   We were surprised to see the courses we conducted grow from eight a year to 20 courses.

Why is this?

There are three main reasons.   I would like to share.

* Do what you love.

* Start small.

* Grow gradually.

This may seem too simple.  Yet this truly is why our business has evolved again and again even when we intend for it to slow down.

Merri and I really do what we love.  Our activity creates passionate beginnings that allow the business evolutionary cycle to begin.

We continually examine our ideas, dreams and passions watching for any growing feelings of enthusiasm.

When we feel enthusiasm, we are willing to escape the tyranny of reason and delve more deeply into the subject of our enthusiasm even if it defies traditional logic.

We start with education… learning more deeply about our interest.

This education prepares us to take a risk, in the hopes of earning a profit.  The profit based action creates a profit or loss… and experience.

Experience leads to new ideas that help us either discard any further business activity or expand.

If we have financial success and enjoy the process, we start the cycle again, but in a larger way and again and again.

If you want extra income to protect your financial future… figure out what you are really interested in.   Become enthused.  Find some small way to make money from being involved and let the process evolve.


Seven P Secrets of Self Publishing

When you write, you can work anywhere. 


Here I am working poolside in the winter, at our Florida farm.

gary scott

Here I am with our hound Ma, working during the summer at our North Carolina farm.

Learn how to earn everywhere, while living anywhere you choose.  I have been able to earn by writing in Hong Kong, England, the Isle of Man, Dominican Republic and Ecuador to name a few of the place I have lived.  Everywhere I have been… too numerous to share here, I have been able to work.

All I need is my laptop.

That’s all you need too… a laptop to be free!

Before computers, a pencil and pad did the job.

Freedom is just one benefit you can gain from writing.

Another benefit is income.   Writing has brought me both our farms, free and clear… plus a lot more.

Another good example of earning potential is my friend Hugh Howey.   He was working for $10 an hour in a book store when he self published his novel Wool, typing in a storage room during his lunch breaks.

Soon he was earning over $100,000 a month on Amazon.com.  This helped secure a six-figure book deal from Simon & Schuster, and an option for film by Ridley Scott, director of Blade Runner and Alien.

That’s what he’s doing now.

Hugh Howey

Sometimes Hugh and I get together at my  farm and play chess (he beats me badly).

Writers like High are great inspirations.

A couple of years ago Hugh  left Florida, and moved to South Africa.  He had a sailing catamaran built for him and now can sail the world while he continues to write.

Hugh explained it like this: And that’s the miracle of working as a writer: I can do it from anywhere and everywhere. The past few years, I’ve done a lot of writing from airplanes and airports while on business trips abroad.  SAND was entirely written overseas while traveling through seven different countries; I think it’s a better story because of those inspirations.  In upcoming years, I may be writing near your home port.

Hugh’s a super star writer and his success could not happen to a more deserving and talented person.  He pours enormous energy into being worthy of his readership.  But you do not have to be a million dollar a year earner or a traveler to benefit from writing.

The good news is… you do not need a huge success to have a rich and fulfilled lifestyle.  Self Publishing can bring you a life that most people only dream of, as a journeyman writer, instead of a super star.

May I hastily add that the path to stardom begins as a journeyman… so the journeyman’s path brings success without stardom… but can also lead to stardom.

What most success stories like Hugh’s rarely explain is the many hours of writing that was devoted before their self published book sales soared.   Hugh, like most writers were journeymen first.  Stardom came later.

Here are sevens secrets that can help you become a journeyman writer. 

The secrets are a writer’s armory of tools that allows almost anyone to create successful publications for income, freedom and fulfillment.

Take Merri’s and my publishing business as an example.  

Merri and I are not writing stars.  We are journeymen who have for more than 40 years, year in and year out, earned solid income writing and self publishing dozens of publications about multiple subjects.

Some years that income has been more than solid… over a million dollars.  Yet in terms of stardom, we are hardly known.

In a moment you’ll see why that’s fine for us and probably will be for you too.

First some history.

Merri became involved in self publishing over 40 years ago… first helping a veterinarian publish a book on a very specific market… animal acupuncture. Then she showed a needle point artist how to sell more books to an even more specific audience… “needle point enthusiasts”  about her needle point work to an audience larger than the population of the city she lived in.  This led Merri to eventually become Executive Editor of an award winning magazine in Florida.

My story allowed Merri and me to work and live from Hong Kong to London to Europe to Eastern Europe, then the Caribbean and then Ecuador… making millions in the process of following our adventures… having fun… while helping a large readership adapt to a rapidly changing world.

That’s what self publishing can bring, profit, adventure and fulfillment, a great feeling of worth and wonder.

Self Publishing has created exactly the lifestyle we desire allowing us to span the world and work with meaning and purpose.

Self Publishing has become a new business art form. 

The seven secrets can help you start your own self publishing business now.

Everything in publishing is new and exciting and changing.  Publishing is being recreated by the wonderful power of destructive technology.

Everything is new… except the seven secrets. 

Change in the publishing industry is disturbing many.   We love this evolution due to these seven secrets we call the 7Ps.  The 7 Ps are so fundamental to writing and publishing that new technology enhances rather than reduces their power.

The First P is Passion.

Whatever your passion, you can immerse yourself in it AND create income with self publishing.  This can be your direct ticket to the kind of fulfillment you’ve always wanted.

Whether you want to travel the world or live as a recluse, work 12 hours a day or not work much at all,  you can set your schedule to succeed, if you’re willing to learn these seven secrets.

You can start part-time with any dream, passion, and budget.  Once you’ve created a product, you’ll enjoy the “multiple effect” of producing profits over and over again.

So the question is… What do you love to do?

What’s Your Passion:  An example is that thirty years ago, a client of Merri’s had a passion to help people who were in pain?  He published a series of pamphlets explaining various chiropractic disorders in very simple terms.  For example: “What Is Whiplash?”

The pamphlets contained solid information, but were simple 5″ x 7″ brochures with drawings and explanations. He sold them with a rack to chiropractors, who put them in their offices for patients to read.  These little self-published items sold year in and year out for decades.

There are thousands of ideas of this sort that can lead to big business.  It’s just a matter of defining and then acting on your passion.

Although I can work when I please and go where I wish, for me the most important reason for being a publisher is the satisfaction it brings. 

I love the projects I take on, so work doesn’t feel like, well… work.

What do you love?  If you love golf, then you can write and sell publications about golf.  Love travel, fishing, dogs, dolls, or art?  Write and sell publications in these fields.

Are you concerned about crime, war, poverty or environmental issues?  You can publish information products that help reduce these concerns.

Would you like to help the world be a more spiritual place?  Publish a newsletter, write a book (or hire someone to write it for you), record a tape… publish something that enlightens people.

Whatever your passion, you can immerse yourself in it and earn income by publishing for ereaders, print on demand, CDs, lists, bound books, or any format you choose.

Be immersed in your passion and get paid well for it. 

This is why stardom is not the main goal for most writers and self publishers.  Extra income, more freedom and fulfillment are usually more than enough enough.

The seven Ps are:

#1: Passion

#2: Problem

#3: Person

#4: Profitably Priced Product

#5: Prospecting Pathway

#6: Promise

#7: Presentation

The first time I exposed others to the secrets in Self Publishing was in a weekend “Writer’s Camp” seminar.  We offered the camp for $1,500. 80 delegates enrolled.  People from all walks of life attended—chiropractors, businessmen, investors, doctors, realtors, inventors, airline pilots, engineers, and housewives.

Merri and I were so overwhelmed by the response, we decided to make it available to a larger audience.  We created a written course based on our current self publishing activity called “Self Fulfilled – How to be a Self Publisher.”  Then we recorded the weekend “Writer’s Camp” seminar.

Thousands have used the course as it has evolved over the decades.

You can receive both the written course and the recorded weekend seminar, in an MP3 file, in a special “Live Well and Free Anywhere” program I am making available to you.  The normal fee is $299 for the written course and $299 for the recorded workshop.   I’ll send you both the course and the recorded workshop and my course “International Business Made EZ (also $299) all for $299.  You save $598.

We are so confident that you’ll gain from this offer that if you are not fully satisfied, simply email us within 60 days for a full refund .

These courses are not theoretical.  They describe, step-by-step, how Merri and I built a million-dollar international business and how we are running this self publishing business right now.   We use the 7Ps today just as we did four decades ago to create a strong annual income.

This correspondence course is for those who would like their own international self publishing micro business for fun and profit. If you want fun, freedom, extra income and fulfillment with your own full or part time writing or want to build your existing business, by writing to sell you can profit from this course.  The course can help who want their own business or who want to have a business together or a family business.  This is the perfect course for those who can no longer find employment, who are looking for ways to earn abroad and who wish to retire and supplement their income.

Whether you are retired, an investor, chiropractor, doctor, dentist, professional or already own your own business, this offers another way to make money, to turn your passion into profit. We guarantee that we have shared all we know to help you start and run your own international business.  Enjoy and live a life of following your Passion to Profit… through writing.

Here is a special offer. 

We provide two emailed courses  “Self Fulfilled – How to Write to Sell and be a Self Publisher” and “International Business Made EZ”.

We include the “Self Fulfilled Writing and Self Publishing Course” because there are two reasons to write, when you have something to say or when you have something to sell.  In this day and age many of us want to do both, make a statement that makes the world a better place and earn something extra in the process. 

Whatever your passion, however you do business, chances are you’ll be writing either to create a product or to sell a product. 

You save more than $598 because you also receive a recorded webinar conducted by our webmaster David Cross (at no extra cost).

David-cross-images tags:"2012-4-20"

David Cross

David has been our webmaster since our website began in the 1990s.  He is Merri’s and my business partner. We could not run our business as we do without him.

Learn the tactics we use in our web business that condenses 27 years of practical experience about search engine optimization, and writing for search engines.

For the last 27 years David has worked with companies large and small – IBM, Agora Publishing, AstraZeneca and many small business owners.  He has worked in 22 countries, and lived in six of them.

David’s clients span the globe and represent companies and charities both large and small.  From corporate giants to small, one-woman businesses and everything from finance, healthcare, publishing, technology, real estate, veterinarians, alternative health centers and everything in between.

David is an essential part of our web based business.

Myles Norin, CEO of Agora, Inc.  wrote:  “I have found David’s knowledge and experience unmatched in the industry.  Without David’s expertise and guidance for the past 7 years, we would not be nearly as successful as we are.”

As Senior Internet Consultant to Agora Inc. in Baltimore, MD, he worked closely with Agora’s publishers and marketers and – over a 7-year period – helped to propel Agora’s online revenues from around $20 million to well over $300 million.

David’s webinar will help you gain benefits in your micro business that large internet marketing companies use.  In this practical recorded workshop you will learn valuable skills to help your micro business.

There has never been a time when the opportunity for small businesses abroad has been so outstanding.  Expand your borders now!  Increase your economic security freedom, independence and success.

If you are not fully satisfied that this offers you enormous value simply email us for a full refund within 60 days.  You can keep all three courses as our thanks for giving our courses a try.

You also receive a report  “How to use Relaxed Concentration to Brainstorm Business Ideas” and a recorded workshop “How to Become and Remain Rich With Relaxed Concentration” at no additional cost.

Plus you get more in the program.


You receive regular writing and self publishing updates for a year.  Businesses usually need to evolve.  Merri and I continue to publish and have our independent businesses.  Some basics have remained for decades, but new strategies occur all the time throughout the year.  We’ll be sending along updates that share our most recent experiences as we learn and continue to grow our international micro business from Smalltown USA.

My special offer to you in this “Live Well and Free Anywhere Program”, is that you receive:

  • “International Business Made EZ” course
  • “Self Fulfilled – How to Write to Sell” course
  • Video Workshop by our webmaster David Cross,
  • The entire weekend “Writer’s Camp” in MP3,
  • MP3 Workshop “How to Gain Added Success With Relaxed Concentration”
  • Any updates to any of the courses, workshops, reports or recordings for a year.

We are so confident that you’ll gain from this offer that if you are not fully satisfied, simply email us within the first three months for a full refund . 

Order “Self Fulfilled – How to Publish to Sell” and a quarter of update lessons $79.   Click Here.

Order “Self Fulfilled – How to Publish to Sell” and a full year of update lessons $299.  Click Here.      

See success stories from Self Publishers and a few who have attended the “Writer’s Camp” that you will receive on MP3.




Pension Cash Problem

A recent Wall Street Journal article “Pulling Retirement Cash, but Not by Choice” highlights a pension problem I have this year.   This challenge will impact a growing number of us in the years ahead.  The difficulty is we have to take taxable income we don’t want or need.

Mandatory minimum distributions from Merri’s and my 401(k) start in full force this year.

The Wall Street Journal article reviews how mandatory withdrawals like this in 401 (k)s, IRAs and other tax-deferred retirement accounts are starting to affect many others and how this force creates such a massive shift of cash, it could impact the stock market.

pensions wsj.com

Image from “Pulling Retirement Cash, but Not by Choice” (1)

Let’s face it.  Too much income is a good problem but still a problem.

The article says:  The largest generation in U.S. history has to start pulling its retirement money this year, kicking off a mandatory movement of cash that could total hundreds of billions in the coming decades.

U.S. law requires anyone age 70 ½ or older to begin annual withdrawals from their tax-sheltered retirement accounts and pay taxes on those distributions.  The oldest of the nation’s 75 million baby boomers cross that threshold for the first time this month, according to a U.S. Census Bureau estimate of when that demographic group began.

Skipping the distribution can be really expensive as there is a 50% penalty on funds that should have been but were not withdrawn.

The obligatory outflows from 401(k)s and IRAs are expected to ripple through the U.S. economy, the stock market and a money-management industry that relies heavily on fees from boomers’ tax-sheltered savings plans and assets.

Another Wall Street Journal article “What to do if you are 70 1/2?” (2) gives some suggestions such as taking distributions in kind instead of cash such as stocks, bonds or even as a piece of real estate.  For IRA owners who don’t plan to spend the money, in-kind withdrawals can help avoid commissions on selling and then rebuying investments.

The article also explains that IRA charitable transfers can be tax-efficient for those who wish to make a donation.  IRA owners can donate up to $100,000 of IRA assets a year to qualified charities and count the gifts toward their required distribution.

However, that article misses the biggest way to gain tax deductions: Have your own business!  A micro business can create substantial tax benefits, even if started after the age of 70.   The earlier one starts, the better, but there are income, lifestyle and tax benefits at any age.

A small, enjoyable, purposeful micro business creates many tax deductions including home office, office supplies and furniture. Computers, copiers, fax machines and scanners can be tax-deductible.   Software and subscriptions can be written off.   Utilities and telephones charges can be set off against income.

Insurance premiums can become tax deductible and even when one passes age 70, retirement contributions can still provide some tax savings.  The idea of contributing to a pension at age 70 and beyond makes sense if one currently has sufficient income.  Contributions reduce taxes now and make help assure adequate pension in come later.

Pension contributions become more difficult at age  70 1/2, but there are still benefits.  Traditional IRA contributions are no longer possible but there is no age restriction placed on the 70+ crowd for contributions to a 401(k).  A 70s plus self-employed worker can contribute more to a 401 (k) than the minimum taxable distribution so the net result for the individual is still a deduction.

There are partial deductions that can be taken on meals, entertainment and gifts.   Travel offers some special benefits especially if the business is tailored to lifestyle.  For example, Merri and I travel from the US East Coast to the West Coast as my mom, a daughter and grandchildren children  are there.  Our webmaster is also on the West Coast so on our business trips we also stop to see the family while we conduct business.  This allows a partial write off on the flight, hotel and car rental.

Take reasonable steps to get business suppliers or customers in places where you want to travel.  Then you can integrate business and lifestyle pleasures.   You can even take your business travel by cruise ship and deduct up to $680 a day.

IRS Regulation 1.274-4 gives one-owner business a friendly rule because transportation costs to a foreign destination for seven days or less, excluding the day of departure, is not subject to an allocation between business and personal days.  If you fly to a US destination and board a cruise ship that takes less than a week to arrive at your deductions can include the cost of:  Round trip travel to the US port of embarkation, cruise ship fare up to $680 per day,  food and lodging in destination, air fare back to US port and air fare from travel to home.

Another great write off can come from using two cars in business.   IRS Form 4562, which is filed by proprietorships and corporations, allows write offs on more than one vehicle.  In specific instances by switching vehicles with your spouse every week you can deduct up to  73.7% business use of two cars.  A couple using average cost cars driving average miles can gain an extra deduction of around $13,000.

Child labor is a favorite of mine.   We can employ our kids or grand kids.  Depending upon how we pay them, they may be able to avoid income taxes.   Plus, there is no Social Security tax when we hire children who are 17 or younger yet we can deduct the salary as a business expense.

Thoughtful child labor may be one of the most powerful inheritances  we can give our heirs.  Merri and I employed our children when they were at home and feel that the experience of the work and responsibility helped them become far more successful in their lives.  We are working on bringing our 14 year old grandson to the farm this summer, so he can mow, trim, dig in the dirt and help raise trout and harvest deadwood to make tables for sale.  This healthy work will get him away from computers and cell phones, leave him with the pride of hard-earned cash and gives us a way to transfer money to him in a tax deductible way.

All of these tax ideas are general and can change almost every year.   Tax planning must be specific to your situation as your income and wealth position is unique.  Be sure to employ a tax professional to assist you creating your own strategy.  You can learn more about this type of tax deduction and get a link to our tax preparer at “Tax Deductible Cruises and Tax Savings Secrets” (3).

Most important of all, a micro business can help us continue serving our purpose.  This is the cornerstone of being a Pruppie.   Pruppies take advantage of every new technology they can.  Pruppies enjoy earning in this advanced technological world.  They also engage in activity they love that serves a purpose in society in a way that will sustain them in case the intricate structure of our technology and global economy should fail.

Pruppies are prepared in case everywhere, or at least everything relating to their income and savings, fails and the fabric that surrounds their lives disintegrates into an unknown veil.  A Pruppie’s efforts are not a sacrifice, but a joy that creates service and income at any age and provides tax benefits even past the age of 70.


(1) www.wsj.com:  Pulling retirement cash but not by choice

(2) www.wsj.com: What to do if you are 70 1/2

(3) www.garyascott.com/2015/08/08/42735.html

Pension Tyranny

The real tyranny that can ruin our pensions may not lay hidden outside our control.  The risk may be waiting within.

Nothing can help us have everlasting wealth more than making good decisions.  Yet the human mind is not always programmed correctly to align with truth.  When we use logic that starts with an incorrect premise, our conclusions will be skewed from reality.  Since life is change and because there is always something we do not know, it is easy to be ruled by a tyranny of reason that is wrong.  False news that spread quickly through social media exacerbates this risk and makes it harder to think through to the truth.


Images from Business Insider article: “20 Cognitive Bias that screw up your decisions.” (1)

A Wall Street Journal article “To Be a Great Investor, Worry More About Being Wrong Than Right” by Jason Zweig  (2) throws out some thoughts on “how tightly most of us cling to our preconceived notions, how fiercely we resist evidence that we might be wrong and how adept we are at deluding ourselves into thinking we were right all along”.

The article ends with this important point. “To be a good investor, you have to be right much of the time. To be a great investor, you have to recognize how often you may be wrong.”

The article says: “Instead of opening their minds to the possibility of being wrong, investors often wall themselves off from new information that could threaten their views.”

The tendency of the human mind is to error, because of numerous biases.  One (pictured above) is called “confirmation bias”.   Another is the “outcome or hindsight bias”.


The conformation bias causes us to look for and favor evidence that confirms pre-existing beliefs.  This bias ignores information that suggests we we might be wrong.  The hindsight bias fools us into believing that we saw the outcome of an event before it took place.

To escape the tyranny of logic, we need our beliefs to correspond to the way the world is, not to the way you think the world ought to be.   The better we know (and accept) ourselves, the better we are at seeing the difference between the truth and what you think ought to be true.   No matter how smart we are, we aren’t rational, and our logic will be tyrannical, if the conclusions we derive come from incorrect assumptions.

Logic is complicated and contains many steps including a Proposition, a Premise,  Inference  and a Conclusion.  When any one of  the initial steps are askew, our conclusion will lead us astray from truth.

An article at logicmuseum.com “The logic of thought. The Nature and Aim of Logic”  shows how our thought processes can start wrong and go adrift. (3)

The article begins: What do we mean by truth? An assertion is said to be true when it corresponds to the reality of which the assertion is made.

We make thousands of decisions every day that we think are rational.  Research suggests that many biases are stumbling blocks that cloud our thinking and cause us to act against our own best interests.

A Business Insider article “20 Cognitive Bias that screw up your decisions” shows 20 of these biases The first three are “Anchoring bias, Availability bias and the Bandwagon bias.


Here are three tactics that can help us reduce our cognitive biases.

Anti Bias Tactic #1: Read social media and the internet with a grain of salt.  A lot of the information is skewed or simply wrong.

Anti Bias Tactic #2: Avoid sharing your opinions to a group with strong views.  The conversation is likely to become more “a battle for status” than “a search for truth.”

Anti Bias Tactic #3: Look for signals that contradict your views.  Let social media reveal alternative viewpoints that could alert you when your strategies are going astray.

“Great investors like Warren Buffett practice trying to disprove their investing assumptions to determine whether they are correct.”

Surprises we may have missed can helps us see how we tend to cling to preconceived notions and how we resist evidence that our assumptions might not be aligned to reality.  This year we can use the three anti bias tactics to help us stop deluding ourselves that we are right when we were wrong.


(1) www.businessinsider.com: Cognitive biases that affect decisions

(2)  blogs.wsj.com: To be a great investor worry more about being wrong than right

(3) www.logicmuseum.com: The Nature and Aim of Logic


How to Reduce Stress and Increase Profits Part II

Growing numbers of pensions have problems but there is a way to have the perfect form of financial security in 2017.   I call it the Perfect Pension.  To help understand how to build an unshakable economic platform here is Part Two of the report,  “The Pruppie Factor:  Seven Steps to Comfortable Living & Profits in 2017”.

If you missed Part One on how to integrate income and profits from savings, read Part One here, as this report will only be available free for three days.

“The Pruppie Factor – Seven Steps to Comfortable Living & Profits in 2017 – Part Two”

PIEC investing combines three types of investments.  The first is your own business or businesses that you are comfortable with and know more about than any other.

The second are safe, liquid investments, blue chip types or the ultimate in stogy and safe, country index ETFs.

The third type of investments are speculative deals or safe investments that use timeless leverage.

Two Ratios

There are two important ratios we need to set.  The first is the ratio between the safe and speculative investments we hold.  This will vary with every investor.  Our needs in relation to our assets, the time we have to let our investments grow and most important, the level of comfort should be determining factors.

My ratio fluctuates between 80% safe and 20% speculative and 70% safe and 30% speculative.

The Perfect Ratio for Leverage

A research paper shows how Warren Buffett has used leverage to amass his $50 billion dollar fortune.  The researchers found that the returns from Buffett’s investment company, Berkshire Hathaway, far outweighed those achieved by any rival that has operated for 30 years or more.  The research shows that neither luck nor magic are involved.  Instead, the paper shows that Buffet’s success hinges on using leverage at the ratio of 1.6 (or a 60% loan) to make large purchases of “cheap, safe, quality stocks”.  In other words, if he chose million to invest, he would borrow an extra $600,000 and invest $1,600,000.

The Perfect Percentage for Each Individual

Buffett has amassed an amazing fortune by leveraging a good strategy for very long periods of time, surviving rough periods where others might have been forced into a fire sale or a career shift.  He uses this in his borrowing:  not too little, not too much, for him.

All investors need to know how much they can borrow.  Financially and emotionally they need to stick for long periods and survive rough patches if that come along.

There are factors to consider when planning whether to use leverage or not and if so at which investment to loan ratio.

Factor #1:  How long can we invest?  We should avoid leveraging short term “get in and out investments”, unless we can afford to take an increased short term loss and have the discipline to cut that loss if and when it happens.

Otherwise we should plan to invest for at least a year (5 years is better) to let the leverage work.

Factor #2: How is our staying power?  If we don’t want or can’t liquidate a loss, can we afford to put up a additional capital as additional collateral?

Factor #3: How much can we afford to lose?  Leverage increases risk.  We can quickly lose part or all of our investments.  We should never speculate with savings that we cannot afford to lose.  We should not use our emergency funds.  We should not use the money set aside for our kids’ college education.  We should not mortgage our house in the hopes that we are going to make some great profit.  We cannot risk our pensions.  (Pension law normally does not allow leverage.)

The more important the need and the sooner the need for that money will be, the lower the loan to investment ratio should be.

The most important factor is comfort.

How do we feel about taking risk?

For many years, I made speculative investments in equities and made some good profits from them.  However, never once did I feel comfortable.

Some investors worry so much about their investments that the stress and strain to their nervous system is not worth any profit they might make. When to comes to equities, that’s me.

Speculating in real estate or currencies does not bother me much at all. Over the decades as I realized this, I dramatically reduced my speculative equity deals.  I hold just one such investment now and later in this report we’ll review why that one investment does not bother me.

Stress can kill!  We should never leverage a speculation if we are going to continually worry about it.

Be comfortable.  A PIEC plan gives us a way to gain everlasting wealth and a feeling of security by being aware of and in tune with a fulfilling, strategic investment plan that goes beyond short term dollars and cents.

Too few investors ask the question, “Why do I want to be wealthy?”

We know that food has to be bought.  Rent has to be paid.  Taxes, bills, cars, gas, education, health care, entertainment all require money.

Yet these expenses do not require that we be really wealthy.  In fact, as we saw earlier in this report, research shows that money’s ability to make us feel good is quite limited once we cross a threshold in the $75,000 a year range.

The link between having money and being happy is not strong because happiness comes in two ways “evaluative” and “affective”.

Evaluative happiness (a sense that we are progressing toward our life goals) keeps getting better as we earn more.

Affective happiness (how often we experience positive emotions like joy, affection and tranquillity, as opposed to negative emotions) does not rise much after a household reaches an annual income of around $75,000.

The research is clear.  Growing happiness comes from achieving goals, not getting or being rich.  When the process of making money is divorced from a long term strategy of completing fulfilling missions, the process of investing is more likely to engender fear and unhappiness, than a feeling of fulfillment and security.

When we invest without a personal, meaningful strategy; our investing logic can be turned upside down in numerous ways.  We risk having a behavior gap.

For example, the Golden Rule of Investing #7 is to never measure an investment by its high or low price.

Price does not represent value!  One of my clients (his name was Dick) taught me this lesson about 40 years ago.  Merri and I were conducting London real estate tours.  London property prices had crashed when most property prices globally were rising.  Property investments there offered excellent value at that time.  Dick heard my story and invested in a property related deal I had written about.  Over the next 12 months, Dick’s investment doubled.

He asked me what to do.  My reply was “If it were me, I would sell half the investment.”  He did.  The sale recouped his original investment.  He had the same amount still invested so his profits could grow, or not.  Over the next 6 months the price of Dick’s remaining shares rose 50% more.  He called me in a rage, disgusted that he had sold half.  He felt he had lost extra profit on the portion of the investment he had sold.  Dick had gained three times his original investment in 18 months.  Instead of being delighted with what he had gained, he was angry, frustrated and bitter over what he viewed as a loss.

He reinvested and never spoke to me again except one time.  He called again.  The share price had corrected dropping 70% in a short time.  Because his reinvestment had been exactly at the highest (distorted) price, he was now in a loss position.  His comment was “Why in the — had I ever suggested he invest?”

Dick should have been looking at a return of 75% in 24 months.  Instead he had a 5% loss.  The moral of the story is that Dick lost because he had no strategy except accepting the current share price of his investment as the final arbitrator of value.

If Dick had a longer term strategy and held onto his London real estate position he would have made a fortune.  Few locations have seen as much property appreciation in the last four decades.

The biggest lesson I gained from Dick was the fact that he was not content, even when he had huge profits.  With “profit as the only motive” investors are in doubt all the time.  If the price skyrockets up, the frustration is not having invested more.  If the price goes down, the frustration is having invested at all.  Every price move creates doubt, insecurity and questions.  “Should I invest more? Should I sell?  Should I hold?”

The reality is that share price rarely reflects true value.  In fact, the faster and higher an investment’s price rises beyond the rise of its income producing power, the lower its value.  Fast rising prices often mean rapidly dropping value and vice versa.  The higher and faster a share price rises, the less it takes for the price to turn around.  The bigger the correction is likely to be.

There is a correct value for every investment.  The problem is no one really knows what that value truly is.  People argue about correct pricing.  This argument is called a market…  investors putting their money where their mouths (or beliefs) are.

No one ever really knows a correct price.  There is always something we do not know because the true value of every investment is changing every single day.  Value even changes each hour or minute.  Factors, forces, events and conditions, far beyond a brain’s capacity to logically process, create changes in true value that no one can always know.

However as humans we all want to know the unknowable.  This flaw in thinking creates a tendency to focus on price and confuse price with value.

What we should know are the wants, needs and desires, created by our unique purpose that we have chosen as our destiny.

We should then know how our investments help complete this purpose, in terms of profit and fulfillment.  We should know how much we paid for investments, how much they are worth and the relationship between our investments and their income producing power.

Trying to know much more than this is counter productive.  There is always something we do not know.   When we invest, we will sometimes be wrong.  George Soros shared an important lesson on what to do about this human frailty when he stated that he was wrong as much as anyone else, but just for shorter periods of time.

He is also quoted as saying:  “The financial markets generally are unpredictable.  The idea that you can actually predict what’s going to happen contradicts my way of looking at the market.”

Soros realizes that it is human to not know everything.  There is no guilt in being wrong.  The only shame comes if we fail to correct our mistakes.

Dick’s mistake in London was that he tied his happiness to the price of his investment.  When the price of his investment rose, he was upset because he wished he had more.  When the price of his investments fell, he was upset because he had anything in that investment at all.

Focusing on investments at their current prices or its high or low price is short term thinking that can create a losing behavior gap.

Another reason many investors lose is because they want their investing to be exciting.

We can again learn from George Soros who said: “If investing is entertaining, if you’re having fun, you’re probably not making any money.  Good investing is boring.”

A few years after my experience with Dick, an investment adviser named Harris contacted me about an arbitrage deal with Japanese yen.

As far as I could tell, Harris was a well educated, conservative businessman who had earned a solid living and built a respectable estate so he could afford a comfortable lifestyle.  He needed to work, but not much.

Somehow a con artist slipped his grips into Harris who otherwise seemed an intelligent, well balanced person.  The scammer convinced Harris that someone in Japan wanted to do some weird form of currency arbitrage with him.  Harris was convinced he would make millions.  All he needed to do was put up some seed money.  What Harris explained to me made no sense at all.  The idea Harris was spouting was so convoluted that I couldn’t even apply logic to it.  Yet he found the deal fun and exciting!  He was able to participate in secret meetings, strange overnight faxes and lots of long distance phone calls to put this deal, always just around the corner, together.

Many times over the past decades I have found that even reasonable intelligent people, when captured by the allure of what they think is big business, refuse to accept that they are engaged in a big ripoff.  They simply will not listen, even when presented with the facts.

Harris refused my warnings that he was being fooled and robbed.  He ignored his business, invested all his savings (and perhaps those of some clients) in seeding the deal.  He eventually went bust.  There was some flap with the law and Harris chose to exit the scene via death by heart attack.  The more realistic term I believe was he passed away from a broken heart when he finally realized how he had given up his savings, his business and his integrity, all for a bit of excitement.

We can have fun and satisfaction with a worthwhile, personal purpose and accomplish missions that achieve a steady foundation of growth.  The process when combined with mathematical investing logic creates everlasting wealth.  Chasing the excitement of quick bucks always stacks the odds against us.  The idea of winning the lottery is exciting, but the odds against us are millions to one.

Perhaps the biggest reason for the behavior gap is the power of fear.

The great value investor, Warren Buffet, tells us why fighting fear is easier said than done. “There is no comparison between fear and greed.  Fear is instant, pervasive and intense.  Greed is slower.  Fear hits.”

This creates a problem because we are conditioned to have fear every day.  So much frightening information is thrown at us that fear becomes a habit.  Fear is the norm.  Almost every establishment that structures our society tries to make us feel fear.  The government says, “Break the law (there are so many laws now) and we’ll put you in jail”.   The medical and insurance professions rely on fear to sell their wares.

We are bombarded with bad news, risks and warnings so fear becomes a habit.  This fear is a hard habit to break as well because we remain immersed in a daily flood of alarming data.

Many readers write in and tell me how they plan to speculate in currency (or other commodity) futures, based on programs they have tested on paper.  I ask them what they’ll do about the fear.

Studying markets in advance is great but do we think that this type of test is anything like actually investing?

When I hear of testing a share (or commodity or currency) trading program on paper, I give this advice.

“Buy a 12 foot long wooden two by four.  Lay it on the floor.  Walk on it.  All 12 feet.  Unless you have an inner ear problem, or other mobility issue, walking the board is easy.

“Now span a 100 foot deep chasm with the board.  Now walk across the board over that 100 foot drop.  It’s the same board.  Right?  Can our emotions ignore the risk of death from the drop?  Probably not.  Mine certainly can’t!”

Actually we should not do this!  Hopefully the point is clear without risking death from a headlong plunge.  The 12 foot walk is easy on the ground.  Over the chasm it’s impossible for most of us… because of our emotion.

Investing on paper without risk lacks emotions.  When real money is made or lost, emotion kicks in and so does the behavior gap.  20% of good investing with real money is knowledge.  80% is emotional control.

My experience suggests that 20% of investors look for change, calculate what the new horizons might bring and invest based on inner beliefs and purpose they stick to.  They do not get caught in the emotions of greed when markets rise. Nor do they panic when markets fall.  Perhaps it is not a coincidence that 80% of the world’s wealth is controlled by those 20% of the population.

80% of investors invest emotionally and lose.

Wise investors know that there is always something they do not know.  Wise investors embrace change as they embrace the reality of their emotions and circumstances.  Wise investors adjust their individual investing style accordingly.

Adjusting our investing styles to our individual personality is important because each of us thinks and feels differently.

An article “It’s not your fault you don’t learn from mistakes… your brain is just wired badly” tells of research that shows that the ability to learn from mistakes varies so wildly between people.

A study at Goldsmiths, University of London created insights about why some people are better at learning from their mistakes than others.

The researchers analyzed electrical brain responses and identified the difference in brain activity to see why some people learn from their errors and experiences faster than others.

The study, published in the Journal of Neuroscience, investigated brainwave patterns to see why some were able to more easily use feedback to check past performance and to adjust their next performance accordingly than others.

Fear is a much stronger motivational force than greed.  Two psychologists, Daniel Kahneman and Amos Tversky, have conducted many studies on the psychology of investing.  In one study they gave potential investors an option between a sure bet of $3,000, or an 80 percent chance of winning $4,000 (meaning there was a 20 percent chance of winning nothing).  Most said they would take the $3,000.

The same question, was then asked in a different way.  Would you rather lose $3,000 or accept an 80 percent chance of losing $4,000 (with a 20 percent chance of losing nothing).  Most took the riskier bet.  The subjects were willing to take a bigger risk to avoid losing money than they were when they stood to make more money.

Know Thyself

Investors are better when they believe in a purpose and understand (at least a little) their attitudes and fears.  There are as many ways to invest as there are investors.  Each of us live by a multitude of emotions created by association over our lifetime.  These emotions are totally subjective and completely unique to each individual.  Take a ping pong paddle as an example.  If one person played happy games of ping pong every day with their friends, every time they see a ping pong paddle their neural system is flooded with neural transmitters that enhance energy and flood the person with a sense of positivity and well being.  Another person who was often beaten with a ping pong paddle sees the same paddle and associates it with pain, terror and fear.

Kirk Kerkorian, a billionaire investor recently passed at age 98.  He left a tip about investing and knowing oneself when he explained, why, when he was a billionaire, he continued to take risks.  “When you’re a self-made man, you start very early in life,” he told The Las Vegas Review-Journal in 1999.  ‘In my case it was at 9 years old when I started bringing income into the family. You get a drive that’s a little different, maybe a little stronger, than somebody who inherited.’”

He started very poor and became rich but nearly lost everything several times.  His attitude was, “Sometimes you lose, but that’s the nature of the game.  There’s always another game and another chance to win.”

Mr. Kerkorian knew his attitudes and had rituals that helped him develop missions that would accomplish what he considered his purpose in life.

Creating New Rituals with Association

Each of us has a personal task to find and face our weaknesses and fears, to discover and reinforce our strengths and desires.  Breaking down old habits of thought and emotion, some that have been with us a lifetime, is hard.

For example I have a tendency to worry.  I know it and the way I face this is with my dad’s old fashioned shaving brush… an “Ever Ready Guaranteed” that he kept with an Old Spice shaving mug.

I have found that I can replace my worry with gratitude, that I was born at this special time, to such special parents and have so many great investing opportunities literally laid in my path.  Every time I have followed my passions in life, some great way to earn excellent income and profits has been there.

What are the odds that I would land in Hong Kong just before it emerged as the world’s hottest stock market for decades?  What are the chances that I would then move to London and then Naples where two of the hottest real estate markets in the world would explode?  What are the chances I would visit Ecuador just before it became one of the hottest expat countries anywhere?

The odds of each were a billion to one and yet each time I moved somewhere I loved, the equivalent of a winning lottery ticket was waiting for me.  So why should I ever worry?

I use my dad’s shaving brush to remind me of this incredible good fortune.  My father passed at an early age and I wish we had had more time together.  I am enormously grateful for what he taught me and how he loved me.  So every day I start by using a gift he left me… that shaving brush.

Picking up that brush brings back a touch of the wisdom and good feelings he shared with me and reminds me how lucky I am, even if my investments happened to have risen or fallen.

There is nothing spectacular about these ideas he gave but the powerful memory of being loved and remembering his touches of wisdom provide positive associations that start my day.

One way to being smarter… happier… healthier is to start every day with something that creates a happy association.  Warm and fuzzy is good!  Such associations are comforting and we are more likely to make wise decisions the day based on what is right for us… instead of based on fear and dread.  That’s darned important in these times of social and economic turmoil and change that create so many feelings of threat.

This is fundamental to well being because happy associations create positive attitudes and positivity cuts through the multitude of noise that an imbalanced society creates.

There is even scientific evidence that the power of this type of ritual can even improve our DNA.

Dr. John Douillard wrote about this at his www.lifespa.com site.

Here is an excerpt:  “In a new study set to be published in the Journal of Psychological Sciences, Harvard Business School researchers set out to measure the effects of ritual.  A ritual could be singing happy birthday, or how you brew your coffee, or saying grace before a meal.

“The study demonstrated that when a ritual was performed before eating, the food tasted better and delivered more satisfaction than when there was no pre-eating ritual.

“In the study, participants cut a chocolate bar in half.   First, they opened only one half and enjoyed that half.  Then, they were allowed to open the other half and eat it – a very simple ritual.

“Another segment of the study created a ritual around eating a carrot.  Participants were asked to hit the table 5 times and close their eyes for 5 seconds before eating the carrot.

“In both groups, the carrot and chocolate were enjoyed more as compared to control groups who did not take part in a ritual.  Additionally, participants in the ritual groups took more time to eat and were actually willing to pay more for the carrot and chocolate after the experience of the ritual.”

The latest research in the field of epigenetics has shown that behaviors and belief systems can actually change our DNA.

This is one way to easily and gently create improvements in your life.   No matter what your background… your genetic makeup… your circumstances… your good fortune or bad, you can make circumstances better by creating positive routines.

The study Dr. Douillard mentioned did have a caveat: the rituals have to be repeated steps, not random gestures, and you cannot watch someone else say grace or open a bottle of wine and expect to enjoy the meal or wine better.  You have to do it yourself.

You can make your life better… no matter what circumstances exist.  Just create simple, positive rituals that you use at the beginning of and throughout every day.

This is why slow, worry free, good value investing is at the core of PIEC’s Everlasting Wealth.

Stress, worry and fear are three of an investor’s worst enemies.  They create a Behavior Gap, that causes investors to underperform in any market good or bad.  The behavior gap is created by natural human responses to fear.   When we combine the  income, from our own fulfilling business, with slow, worry free, good value investing we bridge the gap.

There is always something we don’t know.  The years ahead will create challenges and be interesting.  When we become Pruppies, we look forward to the new with enthusiasm instead of dread.   Merri and I look forward to sharing ideas and information in 2017 that help bring everlasting wealth for you.


I hope this report helps make your 2017 better, and we want to make a special offer that can help you integrate your business and investing.  The offer is limited to three days and ends tomorrow tonight.

We offer two courses for attaining financial security.

The first is our “Live Well and Free Anywhere Program”.  The program contains  a series of courses and reports that show ways to earn and be free. These courses and reports are:

  • “International Business Made EZ” course
  • “Self Fulfilled – How to Write to Sell” course
  • Video Workshop by our webmaster David Cross,
  • The entire weekend “Writer’s Camp” in MP3,
  • The report “How to Raise Money Abroad”
  • Workshop “How to Gain Added Success With Relaxed Concentration”  Report MP3,
  • Any updates to any of the courses, workshops, reports or recordings for a year.

You can learn all about this program at How to Have Real Freedom, but do not order the program there for $299 .  If you subscribe to the Purposeful investing Course in the next three days, I’ll send you the program free.

I invite you to join me and a small selective group who for the next year will participate in an intensive program called the Purposeful investing Course (Pi).  The purpose of Pi is finding value to increase the value of and protect our savings, pensions, income and wealth in good times as well as devastating economic conditions.

Learn Slow, Worry Free, Good Value Investing

Stress, worry and fear are three of an investor’s worst enemies.  They create a Behavior Gap, that causes investors to underperform in any market good or bad.  The behavior gap is created by natural human responses to fear.   Pi helps create profitable strategies that avoid losses from this gap.

Lessons from Pi are based on the creation and management of a Primary Pi Model Portfolio, called the Pifolio.  There are no secrets about this portfolio except that it ignores the stories from economic news (often created by someone with vested interests) and is based mainly on good math that reveals the truth through financial news.

The Pifolio is a theoretical portfolio of MSCI Country Benchmark Index ETFs that cover all the good value markets using my (almost) 50 years of global experience and my study of the analysis of four mathematical investing geniuses (and friends).

The Pifolio analysis begins with a continual research of international major stock markets that compares their value based on:

#1:  Current book to price

#2:  Cash flow to price

#3:  Earnings to price

#4:  Average dividend yield

#5:  Return on equity

#6:  Cash flow return

#7:  Market history

We combine the research of several brilliant mathematicians and money managers with my years of investing experience.

This is a complete and continual study of what to do about the movement of international major and emerging stock markets.  I want to share this study throughout 2017 with you.

This analysis forms the basis of a Good Value Stock Market Strategy.  The analysis is rational, mathematical and does not worry about short term ups and downs.  This strategy is easy for anyone to follow and use.  Pi reveals the best value markets and provides contacts to managers and analysts and Country Index ETFs so almost anyone can create and follow their own strategy.

The costs are low and this type of ETF is one of the hardest for institutions to cheat.  Expense ratios for most ETFs are lower than those of the average mutual fund.  Little knowledge, time, management or guesswork are required.  The investment is simply a diversified portfolio of good value indices.  Investments in an index are like investments in all the shares of a good value market.

Pi opens insights to numerous long term cycles that most investors miss because they have not been investing long enough to see them.

For example, in the 1980s, a remarkable set of two economic circumstances helped anyone who spotted them become remarkably rich.  Some of my readers made enough to retire.  Others picked up 50% currency gains.  Then the cycle ended.  Warren Buffett explained the importance of this ending in a 1999 Fortune magazine interview.  He said:  Let me summarize what I’ve been saying about the stock market: I think it’s very hard to come up with a persuasive case that equities will over the next 17 years perform anything like—anything like—they’ve performed in the past 17!

I did well then, but always thought, “I should have invested more!”  Now those circumstances have come together and I am investing in them again.

The circumstances that created fortunes 30 years ago were an overvalued US market (compared to global markets) and an overvalued US dollar.  The two conditions are in place again!   There are currently ten good value (non US) developed markets,  plus 10 good value emerging markets.

Pi shows how to easily create a diversified, worry free portfolio in some of these good value markets using Country Index ETFs.

The current strength of the US dollar is a second remarkable similarity to 30 years ago.   The dollar rose along with Wall Street.  Profits came quickly over three years.  Then the dollar dropped like a stone, by 51%  in just two years.  A repeat of this pattern is growing and could create up to 50% extra profit if we start using strong dollars to accumulate good value stock market ETFs in other currencies.

This is the most exciting opportunity I have seen since we started sending our reports on international investing ideas more than three decades ago.  The trends are so clear that I created a short, but powerful report “Three Currency Patterns for 50% Profits or More.”   This report shows how to earn an extra 50% from currency shifts with even small investments.  I kept the report short and simple, but included links to 153 pages of  Good Value Stock Market research and Asset Allocation Analysis.

The report shows 20 good value investments and a really powerful tactic that shows the most effective and least expensive way to accumulate these bargains in large or even very small amounts (less than $5,000).  There is extra profit potential of at least 50% so the report is worth a lot.

This report sells for $29.95 but when you subscribe to Pi you’ll receive the report, “Three Currency Patterns For 50% Profits or More” FREE.

Plus get the $27 report, “The Silver Dip” free.

With investors watching global stock markets bounce up and down, many missed two really important profit generating events.  The price of silver dipped below $14 an ounce as did shares of the iShares Silver ETF (SLV).   The second event is that the silver gold ratio hit 80 and has remained near this level, compared to a range of the 230s only two years ago.

These two events are a strong sign to invest in precious metals.

I prepared a special report “Silver Dip 2015” and updated this in 2016 and am about to update it for 2017.   The report explains the exact conditions you need to make leveraged silver & gold speculations that can increase the returns in a safe portfolio by as much as eight times.  The purpose of the report is to share long term lessons about speculating in precious metals gained through 30 years of speculating and investing in gold and silver.

The low price of silver offers special value now so I want to send you this report because the “Silver Dip 2017” offers enormous profit potential in 2017.

Save $457.95  if  You Act Now

Subscribe to the first year of the Personal investing Course (Pi).  The annual fee is $299, but to introduce you to this online course that is based on real time investing, I am knocking $102 off the subscription.  Plus you receive FREE the $29.95 report “Three Currency Patterns For 50% Profits or More”, the $27  report “Silver Dip 2015” and the $299 “Live Well and Free Anywhere Program”.

Triple Guarantee

Enrol in Pi.  Get the first monthly issue of Pi and the report “Three Currency Patterns For 50% Profits or More” and the “Live Well and Free Anywhere Program” right away. 

#1:  I guarantee you’ll learn ideas about investing that are unique and can reduce stress as they help you enhance your profits through your own purposeful business and slow, worry free purposeful investing.

If you are not totally happy, simply let me know.

#2:  I guarantee you can cancel your subscription within 60 days and I’ll refund your subscription fee in full, no questions asked.

#3:  I guarantee you can keep “Three Currency Patterns for 50% Profits or More” and “Silver Dip 2015” plus the Value Investing Seminar as my thanks for trying.

You have nothing to lose except the fear.  You gain the ultimate form of financial security as you reduce risk and increase profit potential.

Subscribe to a Pi annual subscription for $197 and receive all the above.

I am so confident that you’ll gain from this offer that if you are not fully satisfied, simply email me within 60 days for a full refund  and keep the $299 “Live Well and Free Anywhere Program” as my thanks for giving Pi a try.  


Perfect Pension Part 2

Growing numbers of pensions have problems but there is a way to have the perfect form of financial security in 2017.   I call it the Perfect Pension.  To help understand how to build an unshakable economic platform.  Part Two of the report,  “The Pruppie Factor:  Seven Steps to Comfortable Living & Profits in 2017” will be available tomorrow.

If you missed Part One on how to integrate income and profits from savings, read Part One here, as this report will only be available free for three days.


The Perfect Pension

The old economics of depending on life long  jobs, pensions and Social Security are on the run.

The technology driven global economy, demographics and debt are making the past economic thinking and promises suspect.

Job opportunities change more rapidly in the new economy.  Corporate longevity is increasingly vulnerable.  We see many examples of this fact here at our North Carolina farm.

In one nearby town (Kannapolis) Cannon Mills was famous for its “Cannon Towels”.

Formed in 1887, the company believed in cradle to grave job opportunity.  By 1997, due to low cost labor competition overseas, the company was losing money.  Cannon’s largest product buyer, Wal-Mart, encouraged the company to move production overseas.  The company refused to abandon its employees, was undercut by overseas competitors and went bankrupt.

Thomasville Furniture Industries another North Carolina business that also started around the end of the 1800s also tried to remain Made in the USA in the 1990s.  The CEO said  “We really do not want to close plants…. We’ve got great plants, great people. You can’t get them back if you close them.”

The dot.com bubble collapse of 2000 forced the firm to announce widespread layoffs at plants across North Carolina and the West Jefferson plant (our shopping town), which had been producing dining room chairs since the 1930s, was closed.  Thomasville imports grew 15 times from 1996 to 2000.

The number of home furnishing manufacturing jobs lost in North Carolina that year alone was over  2,000.

Whether employers wanted to keep workers or not, economic forces were beyond their control.

In this new economy, employees feel that companies lay off employees with little regard for loyalty or length of service.  Few businesses offered full benefits.  Employees are not expected to last so training and positions are reduced.

The upcoming generation of millennials have already adapted.  They do not expect corporate care and (ages 15 to 30) who have a different set of expectations about their careers, including the need to “be their own brand”.  They plan to change jobs frequently.

Long term jobs are just not secure any more.

Taking government jobs for benefits isn’t the answer either.  Take Detroit as an example.  When the city went bankrupt, retired Detroit employees accepted pension reductions for the promise of reduced pension checks for the rest of their lives.

The promise is based on payments that equal more than $500 million a year — more than twice the city’s annual municipal income-tax receipts in recent years.  The pension fund would need to have consistent investment returns, averaging at least 6.75 percent a year for the next 10 years.  This is unlikely so the promise probably cannot be kept as planned.

Public pensions everywhere are at risk. Twenty countries of the OECD have promised their retirees a total $78 trillion.  Much of this promise is unfunded.  That is almost double the $44 trillion total national debt of those 20 countries. These pension obligations do not show up as obligations on government balance sheets.

Corporate pensions (even those guaranteed by the US Pension Benefit Guaranty System) are underfunded and feeling the pressure to chase yield  to pursue higher-risk investment strategies that could ultimately undermine their solvency. Low interest rates have also caused problems for pensions.

In 2003, the Government Accountability Office added PBGC to its “High Risk” list of agencies and it remains there to this day. The PBGC’s financial future is uncertain, due in part to a long-term decline in the number of traditional defined benefit plans.  The 2015 report shows a net accumulated financial deficit of $61.8 billion an increase of over $26 billion in the last year plus estimated exposure to future losses for underfunded plans of $184 billion.

Even if the PBGC could meet obligations, most pensioners lose under the guarantee.  The maximum PBGC benefit for retirees aged 65 is $55,840.92. The younger a person, the greater the loss.

Fortunately many of the same forces that create these problems also create opportunity.

Broadband and internet marketing technology allows small businesses to zero in on the like minded souls most likely to want your product, service or publication.

This shift makes small better in business.  Instead of watching our lifestyle step down, we can step up the size of our businesses and watch profits rise.

We can see small winning out every day.  Even the biggest business giants are thinking small.  Wal-Mart for example recently announced that it would sharply slow openings of its superstores in the USA.  Sales growth is expected to be lower due to sluggish store traffic and currency fluctuations.  The company said that it will cut its capital spending as $1.3 billion, and shift its focus toward e-commerce and smaller stores.

Trading down has always been a retirement-planning staple.  Now the concept is better than ever before. Instead of trading down into a diminished lifestyle expand the joys of life.  Use writing to reach small audiences.  Create a pinnacle career through writing that brings income longevity.

As Merri’s and my lives have adjusted to the changes, technology has brought to economic and social opportunities everywhere, we spotted a special shift that makes Smalltown USA a special good value.

This is why I have begin working with Independence Monthly.  You can see the September issue of IM here.

Independence monthly

See how we created a great pension in Smalltown USA in last month’s issue of Independence Monthly show.  Click here. Independence Monthly Article

I recommend you learn more about special values of living and learning with Independence Monthly.  Click here for Independence Monthly details.


Trailing Stops and Tax

A recent article at this site Investing Spurts showed how one of my investments that turned 100,000 Danish kroner into 357,679 Danish kroner could have grown to 1,156,069 Danish kroner instead if I had tracked the Magic Calculator.

A reader sent this response.

Hi Gary.  Great article!  Your Jyske Bank example does indeed show how much better one can do using an effective trading algorithm than buy and hold.  Almost more importantly, you can avoid being really buried if you get into a company that gets in big trouble, by getting out early based on a judgement you don’t have to be emotional about. This advice could really boost some readers returns if they take it.

However your calculations are extremely biased because you didn’t adjust for paying cap gains taxes on your trades. Please recalculate and see  the difference. The compounding of  gains works quite differently. You shouldn’t rely on this kind of unreal calculations to make your point more dramatic.  The difference is still striking though offhand your total return might be up to 50% less – just a wild guess. Depends on your marginal tax rate for the one short term trade. This example may be quite exceptional in that the stock movement lined up right so that almost all the trades are long term. But even at that, pay for all the taxes out of the gains and what is your net return?  Best Regards,

That reader’s point is a good one.  I am remiss when it comes to share investing and taxes because all of my investments are made via my pension.  The tax man gets his bite when we take our minimum required distribution, but this allows us to let our investments compound in the pension.

One great benefit of having your own self publishing micro business without employees is that you can form a Chapter C corporation and set up a defined benefit pension plan.

Merri and I were able to dramatically reduce corporate taxes by creating corporate losses via pension contributions.

Because we are conservative investors, we were not clobbered in either the 2000 (we shifted into low yield Scandinavian bonds) or 2008 equity meltdown (we shifted into high yield emerging market bonds) so our only problem when we neared retirement age was that the pension was over funded.   We had to increase our salaries (to increase our minimum distributions) and pay taxes on all of that for a while!

At retirement age, we rolled the Defined Benefit Plan into a self managed 401K Plan.  Because our business still generates income we keep distributions at the minimum so I don’t think a lot about the tax consequences on equity investments.

I’ll write more about the tax planning because over the years it allowed us to build up a comfortable nest egg.  I know that the fed will eventually get its due, but this does allow us to defer and compound for many years.

I thank that reader for reminding me that not everyone has been able to create a good tax deferral program or they have so much money that cannot contain it all within their pension.

A self publishing micro business that allows you to create a pension is one good way to enhance your wealth at the expense of the tax man.


Great Pension Robbery II

The is the second message in the Great Pension Robbery series.

Dad was a zookeeper. My sister Sandra and I benefited from this because dad brought baby lions for us to raise at home. What fun!  We loved them… so cute, warm and cuddly… sort of like a pension.


Portland news article about us raising “Boots” our first lion.

Pensions can make us feel all warm and cuddly… safe in the future… with not a care in the world.  Then like lions they can grow up.


Oops.  Here is dad with Boots some months later… not so cute… not so cuddly and he might just bite us in the… but there is a solution.

The first chapter in this series The Great Pension Robbery reviewed three ways that the purchasing power of pensions can be stolen away.

That article examined the first way pensions can be robbed through under funding from insufficient contributions.

Two other forms of pension theft… are lowered return on assets and the destruction of the pension currency in upcoming messages.

This message looks at pension theft from lowered return on assets


Thomas Fischer speaking at the  Writer’s Camp delegate at our summer home.

Thomas Fischer sent me this note (bolds are mine):  Hi Gary,  Yesterday the ECB lowered interest rates by 0.25% (deposit and loan rates).

As a consequence Denmark also lowered its interest rate by 0.25% (loan rate reduced from 0.45 -0.20%) and the Central Bank also lowered its CD rate (banks deposit rate at the Central bank) by 0.25% to minus 0.20%. It’s the first time in the Central bank´s  200 years history they have had negative CD rates.

They are doing this to keep the currency peg towards the EUR (it can move within a 2.25% band). The Danish kroner is a safe haven and the Central Bank has taken this step to stop the rise of the kroner.

Danish 1 year government bonds yield minus 0.268% whereas investors can get a “whopping”  1.232% on a 10 year bond!

Great if you a looking for financing but for savers it’s awkward!  Thomas

Ways how to get ideas on better returns from Jyske contact: Thomas Fischer at fischer@jgam.com

Canadians and other non Americans should contact Jyske’s  René Mathys at mathys@jbpb.dk

There you have it… you have to pay to have a bond in a safe currency issued by a safe government.  This is not a low return. This is a negative return.

Your pension contributions may be based on the expectations of earning 8% per annum.

Here is an excerpt from a New York Times article entitled “Public Pensions Faulted for Bets on Rosy Returns” by Mary Williams Walsh and Danny Hakim:   While Americans are typically earning less than 1 percent interest on their savings accounts and watching their 401(k) balances yo-yo along with the stock market, most public pension funds are still betting they will earn annual returns of 7 to 8 percent over the long haul, a practice that Mayor Michael R. Bloomberg recently called “indefensible.”

In New York, the city’s chief actuary, Robert North, has proposed lowering the assumed rate of return for the city’s five pension funds to 7 percent from 8 percent, which would be one of the sharpest reductions by a public pension fund in the United States. But that change would mean finding an additional $1.9 billion for the pension system every year, a huge amount for a city already depositing more than a tenth of its budget — $7.3 billion a year — into the funds.

But to many observers, even 7 percent is too high in today’s market conditions.

Projection 7% or 8%. Reality – .02%.

Most pensions are being robbed through these unrealistic projections. The high estimated return reduces the contributions that will be needed for the retirees in later years.   This is a very subtle theft but just as deadly to purchasing power as an armed bandit with his kerchief and gun.

The past wisdom of relying on pensions for retirement may not be so wise in today’s economic and demographic environment.


One adventurous way to extra earn income is with a seminar tour or events business. To see more details on how to start an events business, click here.

Another way to have a steady income is through agriculture.

Ecuador Agricultural Real Estate Tour

For current Ecuador Agricultural Real Estate information send me a note at gary@garyascott.com

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Ecuador coffee farm entrance.

The original owner spent two years searching for the perfect location to duplicate the exact terrain, altitude and growing conditions of the most successful coffee farms of Boquete, Panama and Columbia.

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Terrain and coffee plants.

After walking with an altimeter in hand and talking to reclusive indigenous farmers, this region was discovered with all the perfect conditions to cultivate exceptional Arabica coffee trees.

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Owners house with roof terrace.

This is a micro climate, blessed with abundant rainfall, in clean mountain air, bounded by a clear trout filled year around rushing river, protected from extremes of wind and large temperature fluctuations,  perfect for growing coffee.

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Open drying patio.

It has 11 hectares planted (manageable for a single owner), with approximately 50,000 Arabica, varietal Caturra (self pollinating) coffee trees which  are perfectly distributed over a hillside interspersed with a variety of fruit trees for shade.

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Oranges grown to protect coffee trees.

No problem selling this crop for top dollar due to its proven high quality.  The coffee sales last year grossed $70,000 so after $25,000 expenses, $45,000 was the net income.

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Coffee beans.

As well, an experimental 1 hectare of Geisha varietal.  Geisha is considered to be one of the finest coffees in the world and garnered the highest auction record in coffee history, fetching $170 per pound in 2010.  The first harvest of this varietal is expected in about 2 years.

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Coffee plants grown in greenhouse on farm.

This Andean  location provides an ideal environment for coffee growing without damaging the unique habitat of many species of birds.   Arabica coffee trees are a major source of oxygen production.  Each hectare produces 86 pounds of oxygen per day which is 50% of rain forest habitat.  Ecuador is a biologically diverse country with an abundance of birds, amphibians, reptiles and butterflies.  Inca Mountain Coffee Farm is ecologically in harmony with its environment.

The Arabica coffee trees are 6 years old, providing remarkable yields, allowing for continuous flowering and two annual harvests (major harvest Feb-Jun and minor harvest Oct-Nov).

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Covered drying patio.

In the yearly Golden Cup competition, coffee from this farm was a finalist in 2011.

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Seasonal worker harvesting coffee.

Owner’s house – 900 sq/ft, 2 bed, 1 bath, with lots of marble, built in cabinets in both bedrooms and upper roof porch

Caretaker’s house – divided into multiple rooms with bathroom

Land line phone installed and operational

110 and 220 volt electric lines

Equipment:  2 coffee bean pulpers with 2 water tanks, 2 weed whackers, misc. tools, scale for weighing coffee bags

1 large uncovered drying patio and 1 covered drying patio

2 full time highly experienced workers – monthly payroll is $650 (plus more during harvest for seasonal workers)

Average yearly expenses:  $25,000 (all payroll, fertilizer, harvesting expenses, utilities, taxes)

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This clean mountain river that runs year around with trout.  Also, access to mountain water for farm irrigation, though it is rarely needed.

Farm is fenced along road.

You can set the date for your own tour.

The Ecuador farm tour fee is $799 for single or  $999 couple.

Case Study #3:   This third case study shows an American who has created a   large Ecuador agri operation. This is the farming operation set up by Young Living Essential oils.


After creating a marketing system for the oils and farming in the USA, Gary and his wife…


moved to Ecuador… began a large farming operation as well as…


there own processing and a health spa.

Ecuador is a perfect place for many types of agriculture… large and small.  Find your farm in the safe and efficient way on an Ecuador Agricultural Tour.

For efficiency and logistics this tour is strictly limited to 15 people… 4 persons per four wheel drive vehicle.

You can set the date for your own tour.

The Ecuador farm tour fee is $799 for single or  $999 couple.



The Great Pension Robbery

There is a great pension robbery in progress.

There are three ways that the purchasing power of pensions can be robbed.


Delegates at our seminar center… like minded souls sharing ideas about earning beyond pensions during a coffee break.

The First Pension Theft.  The first way pensions can be robbed is through underfunding due to insufficient contributions.  A pension is a promise. The promise should be backed up by assets that can generate a return. If a business (or government) making the promise does not earn enough money to make adequate contributions then the pension fund simply will not have enough money to meet its promises.

Excerpts from a recent Reuters article “Feds fret over underfunded corporate pensions” by Josh Boak shows that this is a serious problem when it says:  For many Americans with pensions, employers have not set aside enough money.  Corporate pensions increasingly look like an economic time bomb for the government.

Federal officials have assumed responsibility for hundreds of troubled pension plans in recent years. Those takeovers could accelerate as baby boomers start to retire, with taxpayers potentially needing to pay tens of billions of dollars to keep the private plans alive.

“This is going to have massive implications for the country but particularly following on the heels of the latest economic downturn,” said Richard Shea, a lawyer specializing in employee benefits at Covington & Burling. “Pension benefits are being frozen and closed down at an alarming rate.”

For many of the 44 million Americans with pensions, employers have not set aside enough money to provide them a stable income through retirement. Publicly traded companies face a combined pension shortfall of $458 billion, according to a recent report by the bank Credit Suisse.

The cost of rescuing these plans has saddled the federal Pension Benefit Guaranty Corp. with a $26 billion deficit, the highest in its 37-year history. The situation will likely worsen as more companies decide they can no longer afford their pension commitments and stick the government with the bill.

“This is a death spiral,” said a representative of the pension industry. “It may not happen over the course of the decade, but we end up in a situation where we need a taxpayer bailout.”

The problem has become severe enough that the director of the Pension Benefit Guaranty Corp. has publicly campaigned against American Airlines — which filed for bankruptcy last year — for trying to end its retirement plan and dump its obligations on the government.

The article went on to add that American Airlines alone was trying to shed pension liability on 130,000 employees.

The Pension Benefit Guaranty Corporation is funded by insurance premiums from businesses and assets of pension plans that it absorbs.  This agency is deeply underwater with a record deficit in 2011 of $26 billion.  The current estimated liabilities are $107 billion but assets are only $81 billion.

The American Airlines pension shortage is over $10 billion, so just this one bankruptcy increases the Pension Benefit Guaranty Corporation shortfall by 40%.

Pension Protection

We’ll look at the other two forms of pension theft… lowered return on assets and destruction of the pension currency in upcoming messages.

These three forms of pension theft mean that many pensioners will be lucky if they get the full benefits they’ve earned over their careers.  Almost no pensioner can depend on getting the full purchasing power of their pension.

An solution to this problem is a way of doing something you love that earns beyond retirement through a service or a real asset.


Delegates at our Writer’s Camp enjoy talking with each other.  They can come hash around ideas about their  passions as well as writing.

Even obscure passions and pleasures can create income.

Take these fabric designs as an example.


This excerpt comes from the Country Living article entitled “Making a Country Living  – How a mom of six crafted a fabric and accessory business from home.”

Anna Maria Horner has been fabric obsessed most of her life. At age 5 she was already into her mom’s scraps to fashion Barbie dresses. Now a mother herself (of six)the 37 year old designs textiles – as well as everything from pillows to purses – from her Nashville home.

After running a clothing and home goods store for three years she closed shop to focus on creating her own designs. Though it took seven years to land a manufacturing deal for her  fabrics, Horner stayed afloat by selling handmade totes and dresses to local boutiques.

She says: “if you have fun, it shows in your work.”

Her company grossed $250,0000 last year.

The photo above comes from the website of Anna Maria Horner which is linked below.

A quarter of a million a year from home is pretty good… but more important is the fact that Horner IS fulfilling her passion.

Those who have a passion similar to Horner’s but want to live in Ecuador can write about Ecuadorian fabrics, designs and art.

For example we helped one reader learn how to earn in art by creating artistic business cards and professional printing.


These efforts were especially enjoyable for us as they helped the artist, Montero, (below) and several other starving artists in Otavalo, Ecuador.


Montero lives in Otavalo.


Nature Art by…



I once did a study of successful people and this search clarified the fact that most millionaires make their money in business doing something they love. This discovery led to a study of rich businesses, ones that generated everlasting wealth. Here are five of seven secrets I learned about these businesses:

Secret #1: They must enjoy the multiple effect. A product once created must produce profits again and again, almost on a never-ending basis. Each investment made needs to make huge returns.

Secret #2: They need to be greater than their owner’s time. They must produce income even when the owner doesn’t put in day-to-day effort. You may already be wealthy or earning a high income. You may not even need another business or extra income, but some day you might. One surgeon explained it this way. “I am making a fortune because peoples’ lives are in my hands. Once my hands are no longer steady, my income stops. My entire financial well being will then be in someone else’s hands!”

Secret #3: These money making systems should be enjoyable and fun! Sadly most people make money for the sake of making money. Many spend their lives working, just to have a few precious hours having fun. The most important fact I learned about making and keeping wealth was that those who were richest absolutely loved what they were doing! Money was of secondary importance to their effort. And as things are, this means they actually ended up making more money!

Secret #4: These money making systems need to be flexible. No matter what the economy brings, your ability to make money should work regardless of inflation, recession or even depression.

Secret #5: These businesses usually start small, but grow quite large. I learned that good money systems work for large or for small amounts and can be operated on either a full or part time basis. Most businesses start with a learning curve. During that time it is essential they are small. Once the lessons have been learned and the system is operating properly, then it needs to grow for larger and larger returns.

These secrets all show why writing is such a good way to create extra income.

Before discovering these secrets I had my own micro business but to be honest I could never get ahead. I was almost penniless, in debt and living from month to month, check to check. Then I discovered these secrets… and used writing to apply them around the world.

Since then our international micro businesses have brought in millions. We gained all the physical possessions we desired, plus more than enough money in the bank.

We do not have one penny of debt and we have leisure time… though when you love your business… why not work?

Most importantly, we have fun and feel that we have accomplished something beyond just making money every day!  Merri and I do what we love and have learned that through our writing we can accomplish far more important goals, gain self fulfillment and be of service to our community. In short we can help make ourselves and the world a better place.   So we do not worry so much about our pension.

Among our greatest thrills is being able to help others through foundations we have started that help the environment and the poor.

More importantly we have the freedom to do all this from our many locations (some are remote-you might have seen the pictures) that we really enjoy.

You too can have the freedom to do what you love from any place you like, even operating (actually preferably) from your bedroom if you wish.

What do you love? Rare cars? You can make a fortune creating a business around them. Do you prefer fine art? Or do you love beautiful jewelry, coins, gems, real estate, furs, model railways, dolls, scientific equipment, war memorabilia, old and rare books, or whatever? Do you prefer social subjects rather than objects?

Are you concerned with the environment or humanitarian problems, with crimes, war or poverty?  Would you like to help wipe these social problems out in the course of your business?

Are you a golfer? Do you love to travel? Why not make all kinds of money in a global business writing about golf?

Would you like to help the world be a more spiritual place, help people get along better together? You can do something good for the world, increase your income and live wherever you please in the process!

Whatever your interest you can learn how to earn extra by writing (and/or publishing the writing of others) about that passion.

Also, imagine what an international business means to your world travel. Every trip you take can be tax deductible! You can honestly write off every trip that is related to your business. Every journey can become a research oriented adventure and a TAX DEDUCTIBLE EVENT.

As a writer, you’ll have one of the most respected and tax protected businesses in the country. Other benefits come in the form of legal protection.  The First Amendment to the US Constitution provides for freedom of the press… the right to circulate opinions in print without censorship by the government…  the right to publish newspapers, magazines, and other printed matter without governmental restriction and subject only to certain laws such as those relating to libel, obscenity, and sedition.

There is such an abundance of opportunity that Merri and I have created an entire system to help you write and publish.

We began our writing at home. Today, though we have tens of thousands of buyers and have made millions, we still work at home on our remote farms in Florida, North Carolina and Ecuador and have people to help.  Our partners live where they love and work with us through the internet.

You can do the same with a system contained in an online correspondence course called “Self Fulfilled – How to be a Writer and Publisher”.   See details here.

The pension robbery is real and the thieves not likely to be caught because no one person or group is to blame

The world faces a faltering job market and shaky economy with a crumbling infrastructure at a time the world is shifting from a global economy dominated by the USA… to one where business… and affluence are more spread around the world.  This affects kids coming out of school… bread winners with growing families and those of us who are at an age where we can (or expect to) retire. Everyone is involved.

This economic shift, an aging global society and massive debt in most of the Western world almost guarantees that the purchasing power of currencies will fall… in most of the industrialized, debt ridden nations.

The more these problems create change… they also create opportunity especially for writers who can help readers learn how to adapt to the evolving economy and world.


See below how to get our online writers and publishers course free when you attend a Writer’s Camp at our farm.

Read  Feds fret over underfunded corporate pensions

Anna Marie Horner site

New Program Increases Pension Risk

Many who plan to retire expect to rely on their pension, but a new government plan puts pensions at more risk.


Don’t let your plans for this… turn into…



The February 27 New York Times article “To Pay New York Pension Fund, Cities Borrow From It First” by Danny Hakim shows why your pension could be at risk.

Here is an excerpt:  ALBANY — When New York State officials agreed to allow local governments to use an unusual borrowing plan to put off a portion of their pension obligations, fiscal watchdogs scoffed at the arrangement, calling it irresponsible and unwise.

A new borrowing mechanism was approved under former Gov. David A. Paterson.

And now, their fears are being realized: cities throughout the state, wealthy towns such as Southampton and East Hampton, counties like Nassau and Suffolk, and other public employers like the Westchester Medical Center and the New York Public Library are all managing their rising pension bills by borrowing from the very same $140 billion pension fund to which they owe money.

Across New York, state and local governments are borrowing $750 million this year to finance their contributions to the state pension system, and are likely to borrow at least $1 billion more over the next year. The number of municipalities and public institutions using this new borrowing mechanism to pay off their annual pension bills has tripled in a year.

The eagerness to borrow demonstrates that many major municipalities are struggling to meet their pension obligations, which have risen partly because of generous retirement packages for public employees, and partly because turbulence in the stock market has slowed the pension fund’s growth.

Supporters argue that the borrowing plan makes it possible for governments in New York to “smooth” their annual pension contributions to get through this prolonged period of market volatility.

Critics say it is a budgetary sleight-of-hand that simply kicks pension costs down the road.

“You’re undermining the long-term solvency of these funds and making the pension fund even more of a gamble than it already is,” said Josh Barro, a senior fellow and pension expert at the Manhattan Institute, a conservative research organization.


Does this really make pension, evolutionary, economic or any sense?

Here is the Rub and Risk for all Pensions

At this time it appears that just the State of New York government is robbing (Ah I mean borrowing from) their pension funds.

This state regrettably learned form the big guys… the Federal government (other national governments are also playing this game).

This will lead to pension robbery creep.  Government pension creep can be compared to steroids in baseball.  If one player is allowed to use steroids… all the other players have to jump on the bandwagon to keep up.

Once one government uses an unethical… economically unsound  tactic… and gets away with it, all the others follow.

The only protector from this is… the government.  Do you see the problem?

In theory we the people control events with our votes… in theory.  Yet human nature is that 20% of the population work harder than the rest.   This means 80% tend to have less than those who work hardest.   Yet in true democracies the poorer 80% have the biggest vote and they tend to vote for whoever offers them the most… even if the offer makes no economic sense.

For historical reasons the biggest government of all (USA) began the idea of pension theft.  I recall decades ago when the US government was falling deeper and deeper into unsustainable debt and began raiding Social Security.   Germany and Japan had real fiscal discipline then so did not need to do this.
The demographic and human problems in all three countries were the same… an aging smaller population with all voters wanting more and more while giving less and less.

Eventually these nations too became victims of the demographics and human nature. They began borrowing more than they could repay.

The US Government Continues to Lead the Way

As a population catches onto the fact that a government has a wanton fiscal policy… those with money begin voting with their feet. They move the wealth out of the country.

To stop this movement the US has gradually made it increasingly difficult for Americans to hold assets outside the US.

An example is the latest move by the U.S. Justice Department against Wengelin & Co., Switzerland’s oldest bank, which is one more step in stopping Americans from banking abroad.   In February 2012 the department called Wengelin a fugitive from justice on Friday after it didn’t send a representative to a court hearing in New York.

Wengelin was founded in 1741, and is accused of helping U.S. clients conceal $1.2 billion from the Internal Revenue Service.

The bank was summoned to appear in Federal court but stated that it had not been properly served and was not able to appear in court according to Swiss law.

No one attended on the bank’s behalf even though U.S. Federal authorities had seized $16 million that the bank held in a U.S. correspondent account.

This is part of a 40 year process I have observed that makes it increasingly hard (impossible for most) for Americans to bank abroad.

Now the government is taking a similar approach aimed at controlling  $3.6 trillion stashed away in private pensions.

This is a concern for anyone who has a private retirement plan, 401 K, or IRA.

The pension problem has been growing for some time but the newest thrust was taken during the Federal Budget crisis of 2011.   The US government was only able to remain open by taking Federal workers’ pension money was a temporary measure.  The government’s next step in its plan is to make funds in  401(k)s and IRAs available for government spending as well.

That plan was floated as a trial balloon even before the debt crisis… as early as January 2010.

Bloomberg Business Week reported about that and said:  The Obama administration is weighing how the government can encourage workers to turn their savings into guaranteed income streams following a collapse in retiree accounts when the stock market plunged.

The U.S. Treasury and Labor Departments will ask for public comment as soon as next week on ways to promote the conversion of 401(k) savings and Individual Retirement Accounts into annuities or other steady payment streams, according to Assistant Labor Secretary Phyllis C. Borzi and Deputy Assistant Treasury Secretary Mark Iwry, who are spearheading the effort.

There is “a tremendous amount of interest in the White House” in retirement-security initiatives, Borzi, who heads the Labor Department’s Employee Benefits Security Administration, said in an interview.

Retirement plans, including 401(k) accounts, held $3.6 trillion in assets at the end of the second quarter of 2009, while annuity investments of all kinds totaled about $2.3 trillion, according to figures from the Washington-based Investment Company Institute, a trade association for asset managers.

Having watched the government gradually… over 40 years make it almost impossible for average Americans to bank abroad, I can see how the attack on private pensions is working in a similar way.

The Administration is using a similar approach to make it almost impossible for Americans to invest their retirement plans anywhere but in US government bonds and bills… in other words put all investments in private pensions into the government’s hands.

The FDIC  (Federal Deposit Insurance Corporation) took one step in 2010 when for the first time they audited all IRA Custodians.  In advance of the audit they sent a letter to all custodians addressing areas of concern which included though was not limited to Foreign Real Estate and Foreign Companies. The letter specifically focused on the risks that overseas countries represent.

This could be a precursor to a “this is for your own good” approach to private pensions something like the FDA’s approach to not allowing Americans to buy  pharmaceuticals or the SEC’s approach to not letting Americans make investments in other countries.

”They are not safe” is the mantra.  Americans cannot buy investments in Canada because the SEC cannot protect them.  Americans cannot fill prescriptions in Canada because the FDA cannot protect them.  I think you get the drift.

The plan to take over personal pensions could unfold in three steps.

First, the FDIC will want to regulate where an American can invest in another country by determining if that country is “too risky” or not.

The second step will be to allow the FDIC to determine if any investment… even in the USA… is too risky.  Slowly only US government bonds, bill, Trills etc. could be deemed safe enough.

This is exactly what has happened with the ability of Americans to bank abroad.   First layer upon later of regulations were placed upon non US banks.

This legislation made it so expensive for non US banks to have American clients that only really wealthy investors can have overseas bank accounts.

Second, the Fed lowered interest rates so the average American earns almost nothing at US banks where they are forced to leave their funds.

There is not a single line of legislation that prohibits Americans from banking abroad.   Instead the government regulates overseas banks who accept American customers.  Slowly layer upon layer upon layer of compliance requirements have been added that made it so expensive for a non US bank to comply that most have had to stop accepting US clients.

The key in the Fed’s private retirement plan attack will be to place the burdens on the pension custodians not on the owners of the retirement plans.

The FDIC could determine it is “risky” and hence expensive to allow for foreign assets.  This will force custodians to only allow US investments and later only government assets.  These government assets could then be trimmed to pay almost nothing… reducing the pension’s purchasing power.

This is how the government destroyed the ability of Americans to bank abroad.

This is how the government spent the Social Security Fund.

Here is how Forges Magazine describes the Social Security trust fund in an article “What Happened to the $2.6 Trillion Social Security Trust Fund?”

The article said:  Here’s how President Barack Obama answered CBS’s Scott Pelley’s question about whether he could guarantee that Social Security checks would go out on August 3, the day after the government is supposed to reach its debt limit: “I cannot guarantee that those checks [he included veterans and the disabled, in addition to Social Security] go out on August 3rd if we haven’t resolved this issue.  Because there may simply not be the money in the coffers to do it.

Social Security status-quo defenders have assured us for the past 25 years that Social Security is fully funded—for the next 25 years, or 2036.  So if there are real assets in the Social Security Trust Fund—$2.6 trillion allegedly—then how could failure to reach a debt-ceiling agreement possibly threaten seniors’ Social Security checks?

The answer is that the federal government has borrowed all of that trust fund money and spent it.  And the only way the trust fund can get some cash to pay Social Security benefits is if the federal government draws it from general revenues or borrows the money—which, of course, it can’t do because of the debt ceiling.

There you have it.  The US government has spent the Social Security Trust funds.  Then they tapped into Federal employee pension funds.

Now the same government has been using the recent recession and the current financial crisis in Europe to “prove to you” that they can make your retirement plan safer than you can by investing it in government bonds.  “It’s for your own good”.

That is not far-fetched and this is no new phenomenon. Hungary, Poland, Bulgaria, Ireland and France – have taken over their citizens’ private pension money to make up deficits and budget shortfalls. There are battles raging over this in Britain, Canada and Greece to mention a few right now.

I am so concerned that the attack on private pensions will grow after November 2012 that I created a special workshop on “How to Invest Private Pensions in Precious Metals, Real Estate and Structures Abroad” for our February 2012 Quantum Thinking + Investing and Business course in Mt. Dora, Florida.

We recorded this workshop on how to invest private pensions and IRAS in ways that will protect against the government’s pension protection plan.

This recording is available in an MP3 file with a Power Point presentation for $49.

Rather than take your time describing the workshop… we simply remind you of our no fuss… absolute satisfaction  guarantee. Order the workshop. Listen and see. If not totally satisfied, just let us know and we’ll give you an immediate, full refund.


The pension workshop was recorded live at this seminar in February 2012. The Power Point presentation is included with the MP3 file.

Order the Pension Protection Workshop here.


Read “To Pay New York Pension Fund, Cities Borrow From It First