Where in the World to Invest?   With low interest rates… a ratty global economy and high volatile commodity prices, this is a very good question.

The photo below shows the risks in inflation.  Recently when mom decided to sell the old family house I took over the stack of old family albums and while pouring through them stumbled across this hospital receipt for my birth at Portland Sanitarium Hospital.

I wonder what you can get in the hospital today for 79 bucks?

We have to make our money increase its purchasing power if we want to keep up.  Where in the world should we invest to do this?

Is the stock market the best place to go?  Tom Ruggie of RuggieWealth Management threw out some thoughts in his latest Weekly Commentary.

Ruggie wrote: Is the “cult of equity” dying?

Since 1912, stocks have returned on average 6.6 percent per year after inflation, according to Bill Gross, the legendary bond manager from PIMCO. Recently, Gross ruffled some feathers when he wrote that the historic 6.6 percent return “is an historical freak, a mutation likely never to be seen again as far as we mortals are concerned.” Histrionics aside, Gross makes a point that deserves elaboration.

Gross believes that, in the future, less of the country’s wealth will be captured by capital (the financial markets) and more will flow to labor (as higher wages) and government (in the form of higher taxes). For the past 30 years, he said, capital markets were the big winner, as real labor wages and corporate taxes declined as a percentage of GDP. By his analysis, that will start to reverse with the capital markets being on the losing end.

Is Gross right?

Well, his chief critic, Wharton professor Jeremy Siegel, emphatically says no. In an August 2 Bloomberg interview, Siegel made the following three rebuttals to Gross:

1.      The 6.6 percent real return was similar in the 19th century in the U.S., too, so it’s not just a 20th century anomaly or “historical freak.”
2.      Other researchers have discovered non-U.S. equity markets with similar 6 to 7 percent real return averages over the past century, further supporting the idea that the U.S. is not an anomaly.
3.      Often, when the media declares “equities are dead,” that’s a sign a bull market is just around the corner – remember the infamous August 1979 BusinessWeek “The Death of Equities” cover story? Three years later, stocks took off on one of the century’s greatest secular bull markets.

So, who’s right, Gross or Siegel?

It turns out they both could be right. The key is your timeframe. Since markets fluctuate, we’ll likely see periods when the market delivers more than a 6.6 percent real return and other times when it’s less. However, simply buying and holding on for dear life hoping Gross is wrong probably isn’t the best strategy. Rather, rigorous analysis of all the investment opportunities and careful portfolio tweaking could be the solution.

http://www.flickr.com/photos/garyascott/7791480010/in/photostream

Notes: S&P 500, DJ Global ex US, Gold, DJ-UBS Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; the DJ Equity All REIT TR Index does include reinvested dividends and the three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.
Sources: Yahoo! Finance, Barron’s, djindexes.com, London Bullion Market Association.
Past performance is no guarantee of future results.  Indices are unmanaged and cannot be invested into directly.  N/A means not applicable.

COULD THE THREE WORDS “PRIME CHILDBEARING AGE” FORESHADOW the next big up move in the stock market? We’re all familiar with the “Baby Boom” generation and the massive impact they’ve had on society. But, less noticed is their offspring, dubbed the “Echo Boom.” Nearly 80 million strong, “they will be become the next dominant generation of Americans,” according to CBS News.

Today, the number of women in “prime childbearing age” is surging and is at an all-time high. While the recent recession and lingering weak economic environment caused many Echo Boomers to postpone childbirth, this could change quickly if the economy picks up speed.

If this potential pent-up demand for babies actually materializes, we could see a spike in births that helps drive consumer spending, corporate profits, and the stock market higher. This potential demographic trend is one reason to be optimistic about America’s economic future.

Ruggie recently bought into his RWM Dynamic All Asset Strategy Portfolio:

iShares Biotechnology and iShares REIT REZ

I could not agree more. We have a larger… more integrated…global economy with more wealth and productivity than ever before.  These shares make sense to me because there will be increasing demand for real estate and food.

You can learn more about Ruggie and these shares from Morgan Hatfield at Ruggie Wealth.   mhatfield@ruggiewealth.com

Warren Buffet falls on the side of equities.

Buffet’s thinking would seem to fit with Ruggie’s.

Buffet said earlier this year (bolds are mine):  “Investments that are denominated in a given currency include money-market funds, bonds, mortgages, bank deposits, and other instruments. Most of these currency-based investments are thought of as ‘safe.’ In truth they are among the most dangerous of assets. Their beta may be zero, but their risk is huge. Over the past century these instruments have destroyed the purchasing power of investors in many countries, even as the holders continued to receive timely payments of interest and principal. This ugly result, moreover, will forever recur. Governments determine the ultimate value of money, and systemic forces will sometimes cause them to gravitate to policies that produce inflation. From time to time such policies spin out of control.

Even in the U.S., where the wish for a stable currency is strong, the dollar has fallen a staggering 86% in value since 1965, when I took over management of Berkshire. It takes no less than $7 today to buy what $1 did at that time. Consequently, a tax-free institution would have needed 4.3% interest annually from bond investments over that period to simply maintain its purchasing power. Its managers would have been kidding themselves if they thought of any portion of that interest as ‘income’.”

Currency investments are for money which has a reason to fail the risk test. The owner agrees to give up purchasing power in the long run to have more stability and certainty in the short run.

“The second major category of investments involves assets that will never produce anything, but that are purchased in the buyer’s hope that someone else – who also knows that the assets will be forever unproductive – will pay more for them in the future. Tulips, of all things, briefly became a favorite of such buyers in the 17th century.

This type of investment requires an expanding pool of buyers, who, in turn, are enticed because they believe the buying pool will expand still further. Owners are not inspired by what the asset itself can produce – it will remain lifeless forever – but rather by the belief that others will desire it even more avidly in the future.”

My own preference — and you knew this was coming — is our third category: investment in productive assets, whether businesses, farms, or real estate. Ideally, these assets should have the ability in inflationary times to deliver output that will retain its purchasing-power value while requiring a minimum of new capital investment. Farms, real estate, and many businesses such as Coca-Cola (KO), IBM (IBM), and our own See’s Candy meet that double-barreled test. Certain other companies — think of our regulated utilities, for example — fail it because inflation places heavy capital requirements on them. To earn more, their owners must invest more. Even so, these investments will remain superior to nonproductive or currency-based assets.

Whether the currency a century from now is based on gold, seashells, shark teeth, or a piece of paper (as today), people will be willing to exchange a couple of minutes of their daily labor for a Coca-Cola or some See’s peanut brittle. In the future the U.S. population will move more goods, consume more food, and require more living space than it does now. People will forever exchange what they produce for what others produce.

“Our country’s businesses will continue to efficiently deliver goods and services wanted by our citizens. Metaphorically, these commercial “cows” will live for centuries and give ever greater quantities of “milk” to boot. Their value will be determined not by the medium of exchange but rather by their capacity to deliver milk. Proceeds from the sale of the milk will compound for the owners of the cows, just as they did during the 20th century when the Dow increased from 66 to 11,497 (and paid loads of dividends as well). Berkshire’s goal will be to increase its ownership of first-class businesses. Our first choice will be to own them in their entirety – but we will also be owners by way of holding sizable amounts of marketable stocks. I believe that over any extended period of time this category of investing will prove to be the runaway winner among the three we’ve examined. More important, it will be by far the safest.”

Ruggie and Buffet’s thinking agree with what I wrote earlier this year: Here are three simple facts about investing and the global economy that also support the long term potential of equity markets and that can help you spot distortions in equity markets.

The first fact:  Overall we should expect the global economy to grow at about 3% per annum.

This first fact was confirmed by Alan Greenspan in his excellent book, “Age of Turbulence”. He wrote:

“A major aspect of human nature-the level of human intelligence-has a great deal to do with how successful we are in gaining the sustenance for survival. As I point out at the end of this book, in economies with cutting-edge technologies, people, on average, seem unable to increase their output per hour at better than 3% percent a year over a protracted period. That is apparently the maximum rate at which human innovation can move standards of living forward. We are apparently not smarter to do better.”

This gives us a baseline for how much an investment should grow.

If an economy rises faster than 3%, it is distorted. During early stages of excessive growth, investors will be attracted. Shares will rise faster.

If the economy remains robust, shares become overbought. Then watch out! A correction will come.

This leads us to the second fact which is “All investments have risk”.

Rather than wasting time trying to avoid risk… which cannot be done, investors should look at three risk elements instead.

#1: How much risk is there in any particular investment?
#2: What perceptions do the markets have of the risk?
#3: What risk premium is due?

Bank accounts and government bonds, for example, are perceived as the safest investments (especially if government guaranteed). A look at their long term history shows that they pay about 3%. If a bank account or government bond pays less…in the long term it’s bad. If it pays more…that’s better. The idea is that bank accounts will not really make money. They will just keep up with growth…at 3%.

To get real growth requires taking risk. If an investment appears to be less safe, it will pay more than 3%. This is called a risk premium.
 Bonds pay more than bank accounts because they are perceived to be less safe. Stocks pay more than bonds because they are perceived even riskier. Emerging market stocks pay more than major market stocks. Emerging market bonds pay more than major markets bonds.

Over the long run, bonds issued in countries and currencies perceived to be stable pay 5% to 7%.

Stocks in major countries should pay 7% to 10% annual return in the stock market as a function of global growth, long term earnings growth plus risk premium (above bank accounts and bonds).

To attain higher growth than 7% to 10% investors must either increase risk, trust luck or spot distortions.

This is good because the market is almost always wrong. Most investors always try to avoid risk. Most investors dump their wealth into investments that are perceived to be safe. This creates excessive demand and lowers value and actually makes the original perception wrong.

Knowing this helps wise investors spot deceits in the dimension of time.

Take, for example, the emerging market trend that has been created by an imbalance in labor costs around the world.

There are 6.6 billion people on this earth (give or take a few hundred million). 1 billion of these people live on a dollar a day. 2.5 billion live on two dollars a day. This means that there is a vast pool of cheap labor that can create goods at bargain prices. Mature economies are buying these goods at such an increased rate that 20% of all goods produced now cross a border, mostly from poor countries to the rich.

This means that emerging economies are growing much faster than 3%. They are catching up and this has caused major markets to slow down.

Yet emerging economies are perceived to have greater risk.

Smart investors have seen the value create by this distortion and have been cleaning up. They have been paid a huge risk premium when the risk has not been real!

The risk has been eliminated by low labor costs in poor countries and improvements in communications and transportation.

From 200o to 2010, the average annual return on emerging markets was 19.81% compared to 10% for major markets.

The Emerging Markets longest down turn was six months and the biggest drop 55%.  For major markets, the longest down turn was also six months and biggest drop 53%.

We can see that there has been no more risk in emerging markets than major markets... plus the upside has been much better.  This has now changed and you’ll see why below after looking at the third fact.

The third fact:  Periods of high performance are followed by times of poor performance.

Emerging stock markets have outgrown major markets by about 7.5 times in the last seven years. Yet their economies are only growing about twice as fast.

Major markets have grown on average about 6.5% per annum for the past seven years….a little below what they should.

This has led to the point where emerging equity markets around the world correct down and major markets up a bit.

Yet in times of global panic as we have seen, all markets tend to drop. This means that at this time, major markets which may have been somewhat undervalued and should be rising are being pushed down by the drop of emerging markets (which should correct themselves).

Understanding these three facts leads us to know that a portfolio of European shares is a great bargain at this time…. but there is a special time risk.

Micheal Keppler stated in his recent major market valuation:

In my more than 30 years’ experience, I have never seen such a bad sentiment towards continental Europe. After a strong start in 2012, chances are good for a continuation of rising stock prices in general for the coming years.

If history is any guide, chances are better still for the Major Markets Top Value Model Portfolio.

This view is supported by our implicit three-to-five-year projection for the compound annual total return of the Equally-Weighted World Index, which now stands at 15.3 %, down from 17.6 % last quarter.

The upper-band estimate of 13,835 by March 31, 2016 implies a compound annual total return of 20.7 %; the lower-band value of 9,223 corresponds to a compound total return of 9.0 % p.a. Even our worst case makes equities look attractive — please see chart below, which shows the entire real-time forecasting history of Keppler Asset Management Inc. for the Equally Weighted World Index.

These numbers are based on relationships between price and value over the previous fifteen years. Given the current low levels of interest rates – real rates are negative in most places – I would like to point out that we do not have to be right with regard to the magnitude of our projections, but only directionally for investors to make money.

This is why we have been recommending High Yield shares.  Most are major market equities that provide income and growth potential… plus make it easy to diversify. 

This is why we are weighted into Northern European and Italian banking shares shares that we feel offer extra special value and extra risk premium.

There you have it. Understanding the 3% solution and what markets have done show a distortion. Blue chips may be oversold more than emerging shares now.

In the long term, emerging shares will rise. Poor people remain and are willing and able to make goods that others will buy. This will push their economies higher faster than in major economies.  Yet for now the three percent solution shows that major markets and high quality shares especially European are more likely to recover from the current doldrums first.

Buffet Seems to Have Similar Philosophies

Berkshire Hathaway recently added energy shares, National Oilwell Varco and Phillips 66 to their portfolio.

Buffett’s firm also tripled its stake in Bank of New York Mellon, from 5.6 million shares to 18.7 million (banking). It also raised its stake in DirecTV from 23 million shares to 28 million.

Berkshire doubled its position in the newspaper publisher Lee Enterprises Inc., to 3.2 million shares. The company maintained its stakes in other publishing companies, Gannett Inc. and The Washington Post Co. (Publishing).

Four of my major equity holdings are in the same sectors:

Brookfield Renewable Power (Energy)
Unicredit & Jyske Bank (Banking)
Axel Springer AG (Publishing)
Sky Deutschland AG (TV)

Buffet and I may agree on the sectors that may be undervalued, but the difference is I am speculating on shares in Northern Europe that earn mostly in Northern Europe.  This is based on my belief that markets have oversold the Euro weakness and that even shares which do not earn much outside Germany and strong Northern European economies are oversold.  If the Euro fails, these Northern European companies are likely to do especially well in a currency reform.

This is more speculative than Buffet or Jyske’s JGAM who are totally out of the Euro at this time.  Fund managers have to be more sensitive to short term movements. Because I manage only my own funds and have a longer time frame I can wait for this Euro weakening to unravel.

Whatever your time frame…. whatever your beliefs, you do need your money to increase its purchasing power and equities are one of the best ways to do this.  I feel it is important to look for Where in the World it is best to invest in equities now.

See a huge Ecuador real estate shift that creates investing opportunities as well.

Gary

Join Merri and me with Thomas Fischer of Jyske Global Asset Management and Larry Grossman of  Sovereign International Pension Services to see where in the world to invest in 2013.

Super Thinking + International Investing & Business Seminar

Super Thinking + International Investing & Business Seminar, February 1-2-3, 2103 in Mt Dora Florida.

This is the premier seminar we have been conducting every February for over 30 years.  This February is special because the best opportunities come at the darkest hour and that time is here.  Learn how to…

#1: Borrow yen at 2.5% and gain a 5% profit in three weeks.

#2: Turn $499 into $142,020… per year.

#3:  Buy a beach view Ecuador home for $16,000.

Review these ideas in warm and sunny Lake County, Florida, with over 1,000 named lakes and the charm of historic Mt. Dora. This a special place especially at the this time of year.

(Click on photo to enlarge).

These are balmy winter days I shot of the Florida winter from…

my canoe.

Forces have come together for the biggest economic expansion in history.   Huge profits are waiting in business and investing… whether you are just starting… in the middle… are ready to retire or want to start an entirely new career.

One reason for this timing is cyclical.  Equity markets are selling at some of their best valuations in years.

This optimistic outlook is based on the development of earnings, cash flows, dividends and book values.

When you look at the big picture… from the turn of the century until now the entire global economic history has been a series of slow downs and catch ups,  but over the long run  values in the stock market have risen about 9.1 percent, respectively, compounded annually.

There are always emotional reasons for slow downs…  as we have seen in the past five years…  the worries of double dip recessions… high unemployment… concerns about fiscal cliffs. Such fears hold investors back.  Yet  global population growth and advances in production and prosperity are relentless.   Values increase as prices stagnate. Then markets break free and rocket upwards creating wealth, prosperity and growth.

Economic breakouts create fortunes.  This February we get to share with you three… enormous profit possibilities…. one in business…. one in investing and one in Ecuador.

All the facts have come together.   The next boom is about to begin.

We can see the power of breakouts from the last BIG ONE in 1979.   Warren Buffett saw it coming. He mentioned it in a famous 1979 Forbes article “You Pay a Very High Price in the Stock Market for a Cheery Consensus”.

Everything looked bleak.

The 1980s recession, the worst since the Great Depression, was about to begin.   Yet in 1979 Buffett said…. BUY NOW.    On August 13, 1982 the biggest global bull stock market in history began.

The Dow’s 1982 to 1999, relentless 17 year climb is just one breakout we can see.

Click to enlarge.

1979 was the darkest hour.  The herd was thinking negatively.   The reality?  A boom was on!   Then in 1999 another economic contraction began and has been with us till now… 14 years.   The cycle is repeating.  This is the beginning of an even bigger boom.

“It’s not what’s happening that counts. It’s what you do with it.”

Make no mistake… Merri and I have been able to help readers have better lives, less stress and to make fortunes during these last 17 economically depressed years.  Yet the simple fact is that the really big profits come at the start of a boom.  This is why I want to kick off 2013 with you and share more than my usual confidence and enthusiasm. 

The upcoming February seminar is divided into three main sessions.

Each session helps you learn how to gain freedom, remove stress, earn more and do more good in and for the world.

Session One :  International Micro Business – “How to Have a Positive Global Income”.   You can turn $499 in $142,020 a year, even in small towns.

Session Two : Ecuador Living and Real Estate.

Sessions Three:  International & Value Investing Outside the Box.

Here is a partial syllabus of the seminar:

SESSION ONE:  How to Turn Your Passion into a Profitable Microbusiness.   A micro business can be the best investment you can make. Start small and magnify your investment with your effort, enthusiasm and energy.

* Turn $499 into $142,020 through writing and publishing… without risk.  In just one year.  Cash in on the blowback from the global community.  The global economy is good but big business… big government…. big medicine and global everything is also impersonal, often harsh and inhumane.  This expansionary process leaves us believing in nothing.  We are cynical of the global banks… the aggressive police… the intrusive government… the big church… the monetized medicine… the negative media… the unfair laws…. the failing currencies… all the broken promises.

Yet as humans, we have to believe in something and our last bastion… the one we can see, hear, taste, smell and feel is our local community… either as a  place or as a collection of like-minded souls.

This is also where we can actually accomplish something and actually have an impact at doing some good.

On January 1st, 2013, Merri and I launched a new business “Positive Community Magazines” (PCM) with David Cross our webmaster and Dave & Sherry Johnson. This opportunity is for anyone young or old.  PCM offers excellent income… less stress, fulfillment and positive service to the community.  This business helps publish positive community magazines in small towns or to small communities of highly focused, like-minded souls.

Warren Buffett believes so much in this potential that he is buying newspapers in small towns all over America.

In 2012 Berkshire Hathaway purchased 63 small and mid-sized daily and weekly newspapers throughout the United States.

He plans to buy more and says: “I like buying individual papers at the right prices.” 

Buffett stated that Berkshire is not buying big newspapers or more newspaper shares because he believes in the value of local communities.

In February, you’ll meet Dave & Sherry Johnson who had a good life until times turned sour during the 2007 recession.  They lost everything so they moved to Asheboro, North Carolina which Forbes magazine highlighted as “One of America’s Ten Fastest-Dying Towns in the USA”.  They started a community magazine and from the ashes it has risen from success to success.   They now earn over $17,000 a month.  They came to our Writer’s Camp.  We saw their amazing business model and let no moss grow under our feet before asking them if they would help us spread this incredible concept around the world.

We know trends when we see them and this is even more exciting than the trend we saw in Ecuador’s expansion 17 years ago.

As an Independent Community Publisher of Positive Community Magazines, you will publish positive, upbeat community publications dedicated to representing, encouraging and celebrating the community you serve by focusing on the lifestyles, talents, gifts and contributions of the people who live and work there.  Plus you’ll earn as much as $17,635 a month.

Learn how to gain a proven business model with training – archive of articles – design templates – access to low-cost printing – marketing materials – and a very, very low investment (as little as $499) to start.

The Money – Here is the Proforma Income for a 64-page Magazine

In the model magazines the ad revenues run around $13,000 (40% ads/$500 per ad page) and editorial revenues of $4,635 or a gross income of  $17,635 a month.

Printing  and operational expenses are in the $5,800 range leaving  profits of $11,835.  You increase the bottom line if you do more of the design and distribution work yourself.

Other advantages of magazine publishing include the freedom to set your own schedule,  PRESS credentials, prestige, service to the community, philanthropy, being in the know and having a well respected profession.

Saves Lives.  Here is just one example of the good you can do. Sherry Johnson shared this story.

She wrote: Gary,  we even save lives.  In one issue of their magazine they told the story of a little boy who was struggling with a rare disease that caused life-threatening seizures.  One day, while his mom was out shopping, the little boy had a seizure so she rushed him to the hospital.

She called ahead and the nurse met her at the emergency room.  As it happens, the nurse had read the article in the magazine (which someone had brought to the nurse’s lounge) and she recognized the little boy from the article.  Since she knew immediately what was wrong with him, no time was wasted and he was treated quickly.  They were told that this particular seizure was especially bad and that the article probably saved his life.  This doesn’t happen every day but once in a lifetime is good enough!

Downtown Mt. Dora, Florida

Another session in the seminar shows “How to have an international micro business.”  These sessions are highly practical and usable. They focus on how to use modern technology to start global micro businesses based around a website, with minimal investments of time and capital.

By starting small and building with stepping stones and a harmonious focus, Merri and I have learned how to own profit generating phrases at Google.  We, along with our webmaster, David Cross, share the secrets of how you can use words to create your own global income.

The seminar shares how we us “Seven Ps”  (Person, Problem and Promise, Product) to zero in on key word phrases.  The Fifth P (Promise) develops new customers. The Sixth P is the Prospecting Path and Seventh P is the Presentation that creates income.

Learn about other microbusiness possibilities…

In the global micro business sessions we’ll see ideas on how to:

* Create Export Businesses

* Earn from Self Publishing and Writing

* Develop Internet Sales

* Cash in on Ecuador Business Ideas

* Find Organic Agricultural Business Ideas

* Profit With Health Business Ideas

* Turn Ideas for Tours and Seminar Businesses into Profitable Lifestyles

* Create a Multi Dimension extra income lifestyle.

Multi dimensional living can create a lifestyle that brings better health and lasting “real” wealth.  Many readers  are choosing a multi dimensional lifestyle, living on a farm and earning in other ways such as writing.

Activity on the farm in North Carolina. It’s tax deductible and profitable but…

I cannot call it work.

Merri and I have been fortunate. The self publishing business has treated us well.  However a great deal of our financial stability also comes from being multi dimensional.  We have lived on our own farm and seminar camp and orange grove and in our own Ecuador hotel and hacienda.  We are always fixing things up…. buying broken places or taking broken ideas and making them whole.

For decades we have been buying houses and fixing them… painting, restructuring and such.  This is our hobby… that happens to be profitable… or maybe that’s our business and writing is the hobby that also happens to be profitable?

The point is what we do is not work.   We just regularly do what we love and figure out how to earn income in the process.  The adage framed on my desk given to me by a beloved Indian Pundit is “Action is Thy Duty… Reward Not Thy Concern“. With this motto and a bit of common sense living joyfully and earning merge.

Our daughter, Cinda, and David Cross, our son-in-law webmaster and granddaughters, Sequoia and Teeka, have taken this lifestyle route as well.   Cinda loves animals so is a veterinarian and specializes in animal acupuncture which she can do at their farm.

David has his website and voice-over business he can run from their farm and the girls love working in the gardens.

David and Cinda’s multi dimensional farm. They now produce 60% of their food and earn extra income selling their excess organic crops.

Using the Bio Degradable “Bio Wash” to gain added value we have been able to double our production and quadruple the profits in our orange grove.

In the multi dimension segment of the seminar we review how to spot “live on agri and B&B opportunity” in small towns and Ecuador.  We’ll also look at Bio Wash, that we have supported now for nearly 20 years. We’ll show the environmental as well as health and business benefits it brings.

Join Merri and me at our Super Thinking + Investing and Business Seminar – February 1-2-3 , 2013, Mt. Dora, Florida.

Enroll here $799.   Couple $999

See  How to Attend this Seminar for $177 instead

SESSION TWO: Ecuador Living.  Talk about catching an early wave… Merri and I caught the Ecuador expat trend right at its beginning 17 years ago.   We brought readers who joined us in Ecuador then… some amazing opportunities.  This cycle has matured but there are still great bargains if you know what to do.  No one has as much experience and as many contacts in this field. This experience is also dependable.  We do not sell Ecuador real estate so you won’t be hearing any hidden agendas.

A beach house for $16,000?  Is that bargain enough?  You cannot beat experience when it comes to learning all the ins and outs and buying real estate in a country like Ecuador.

For example after more than a dozen years of traveling… working… buying and selling real estate and running businesses in Ecuador… we led Jean Marie Butterlin from France to the coast and he began scouring the beaches from Manta, north to Pedernales… finding the bargains…. meeting the landowners…  understanding the rules, regulations and customs.

That experience made him the expert of Ecuador beach real estate so that bargains could be found and so his clients could overcome the biggest problems and intelligently buy real estate on the coast.

We’ll share how to  buy beach property intelligently.

Here is Jean Marie’s second beach home…. secluded overlooking this…

isolated beach home for just…

$16,000.

You’ll learn how to overcome one of the biggest mistakes most real estate buyers make on the beach.

Dr. Andres Cordova will speak and join me in updating Ecuador real estate and residency rules.

Dr. Andres Cordova speaking at our seminars.

Andres is our friend and Ecuador attorney. He is the grandson of one of Ecuador’s more famous presidents and was a senior partner in a law firm that represents Ecuador’s treasury.

We’ll also review how to create an Ecuador export business as Merri and I have for many years.

Roberto Ribadeneira speaking at our seminar about how he can shop, ship and charge for Ecuador export businesses.

We’ll review the Ecuadorshop Logistics service that provides all these services for exporters in importers into the USA.

We’ll share how Roberto provides an exclusive service that helps readers who export from Ecuador monitor production and quality and assure timely delivery.

This is a great service that provides every detail for importing products into the USA.   We have used this logistics service ourselves for years and became the largest shipper of Ecuador roses last Christmas.  One big benefit is that the service can send each product direct to the buyer in the USA.  The Ecuadorshop Logistics service makes small and medium scale Ecuador exporting possible.

Join Merri and me at our Super Thinking + Investing and Business Seminar – February 1-2-3 , 2013, Mt. Dora, Florida.

Enroll here $799.   Couple $999

See  How to Attend this Seminar for $177 instead

Session THREE  – International & Value Investing Outside the Box.  This session shows how to protect your investments and savings, plus what to do with extra profits you’ll earn.

The educational program Merri and I have developed uses a different form of frequency modulation that opens enormous opportunity for expansion, understanding, peacefulness as well as greater wealth.

FM teaching uses frequency (in music and with each sense… sight…. smell, tactile and even smell) to integrate brain waves so the process of absorbing, processing and recalling information is vastly accelerated.  This brings forth the three C’s:  Calm, Clarity and Coherence.

FM creates relaxed concentration… a key to happiness, health and success.

You learn whole brain thinking that can help improve your freedom, satisfaction and income through business.

This part of the seminar helps us integrate their brain waves so they are more intelligent, intuitive and relaxed.

The Super Thinking sessions show three ways (baroque music, relaxation and nutrition) to get into and stay in a state of relaxed concentration… a mental state shown to enhance almost every human capability… especially writing.

Merri and I are explorers so we have used this techniques for decades. We  are always looking for what’s next… trying to stay on or ahead of the leading edge and need ways to think outside he box.

The Super Thinking sessions share how we do this to live better…. using frequency modulation to be smarter… stronger…. more energetic… more aware, friendlier, compassionate, happier and healthier.

We are in our 45th year of business and we share what we have learned and where this is leading our activities in our upcoming seminar. Join us.

Spotting new trends and applying them to our micro business has brought us a strong and continual flow of income through good times and bad.  More importantly the process has been fulfilling…. beneficial to society and healthy.    Now you can benefit from the latest… and perhaps strongest… of all the trends we have stumbled upon.

Applying the concepts of super thinking to spotting trends over the past 45 years has helped thousands of our readers make and save millions.   The success of our readers has been a driving force in our lives yet we have always wanted to do more so continued looking deeper at ways we can share how to have income, stability, good health and contentment.

Join us to learn our most recent experiences and most advanced concepts and ideas.

Join Merri and me at our Super Thinking + Investing and Business Seminar – February 1-2-3 , 2013, Mt. Dora, Florida.

Enroll here $799.   Couple $999

There are two more Reasons to be in Mt. Dora February 1-2-3.   One is old time values.

The Lakeside Inn seen from Lake Dora.

130 years ago three local, and reasonably successful individuals, sitting around around one afternoon when one of them says “hey… lets build a hotel”.  The three agreed, plans were drawn up, materials were ordered and work began.  The year was 1883, Mount Dora was still called Royellou, Chester Arthur was President, and it would still be several years before the railroad would make its way in to town.   This leaves the Lakeside Inn as the oldest, continuously operated hotel in the State of Florida.   The Inn is just across the street from our meeting place and is celebrating its 130th Anniversary throughout 2013 with a number of special events and celebrations.

Mt. Dora Arts Festival.  This is is ranked in the top hundred art shows in the US. It’s a juried fine arts festival, for art lovers, casual festival-goers and families.

Downtown Mount Dora, with its New England architecture and breathtaking views of Lake Dora is the backdrop for this event. In addition to the endless rows of fine art, including oil paintings, watercolors, acrylics, clay, sculpture and photography, the festival features local and regional musical entertainment at a main stage in Donnelly Park.

The event draws over 300,000 visitors and features more than 285 artists from all over the world.Super Thinking + Investing and Business Seminar -

Join Merri and me at our Super Thinking + Investing and Business Seminar – February 1-2-3 , 2013, Mt. Dora, Florida.

Enroll here $799.   Couple $999

See  How to Attend this Seminar for $177 instead

Join Merri, me and the following speakers:

* Thomas Fischer of Jyske Bank, who will talk about International investing, forex, plus borrowing low to invest high.

* Rich Checkan of Asset Strategy who will update the state of the precious metals markets.

* Dr. Andres Cordova updating Ecuador real estate and monetary, residency and tax regulations.

* Dave and Sherry Johnson. How to turn $499 into 142,035 with Positive Community magazines in small towns.

* Shirley Peacock.  Lake County real estate.

* Mike McDonald. Aegis Capital Corp.

* Lou Shinamin. Ruggie Wealth

* Larry Grossman. Sovereign Pension Management.

Join Merri and me at our Super Thinking + Investing and Business Seminar – February 1-2-3 , 2013, Mt. Dora, Florida.

Enroll here $799.   Couple $999

See  How to Attend this Seminar for $177 instead

Warren Buffet’s description of investment types at Fortune.finance

Pension protection mathematics are filled with deceit because of the essence of time.

Last February we began a series on pension protection and the deceits of intervention.  The first article New Program Increases Pension Risk  shared  how new regulations that began in New York City were allowing municipalities to borrow from their pension to fund their pension.  This is one of the most deceitful moves I have seen… the snake eating its tail.

Does borrowing money from a pension to make a payment into the pension really make sense?

Now at least we can see one honest comment about pensions from a New York City official. It is an honest statement about a universal pension deceit from New York’s Mayor Michael R. Bloomberg.

He said:  “If I can give you one piece of financial advice: If somebody offers you a guaranteed 7 percent on your money for the rest of your life, you take it and just make sure the guy’s name is not Madoff.”

This quote comes from a New York Times article entitled “Public Pensions Faulted for Bets on Rosy Returns” by Mary Williams Walsh and Danny Hakim.

Here is an excerpt: Few investors are more bullish these days than public pension funds.

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.”

Now public pension funds across the country are facing a painful reckoning. Their projections look increasingly out of touch in today’s low-interest environment, and pressure is mounting to be more realistic. But lowering their investment assumptions, even slightly, means turning for more cash to local taxpayers — who pay part of the cost of public pensions through property and other taxes.

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.

“The actuary is supposedly going to lower the assumed reinvestment rate from an absolutely hysterical, laughable 8 percent to a totally indefensible 7 or 7.5 percent,” Mr. Bloomberg said during a trip to Albany in late February. “If I can give you one piece of financial advice: If somebody offers you a guaranteed 7 percent on your money for the rest of your life, you take it and just make sure the guy’s name is not Madoff.”

In short, most pensions are relying on unrealistic projections to have enough to meet their obligations.   This is a very neat form of hidden inflation.

Seven percent may be a long term

Here are three simple facts can help you spot distortions in equity markets.

The first fact. Overall we should expect the global economy to grow at about 3%.

This first fact was confirmed by Alan Greenspan in his excellent book, “Age of Turbulence”. He wrote:

“A major aspect of human nature-the level of human intelligence-has a great deal to do with how successful we are in gaining the sustenance for survival. As I point out at the end of this book, in economies with cutting-edge technologies, people, on average, seem unable to increase their output per hour at better than 3% percent a year over a protracted period. That is apparently the maximum rate at which human innovation can move standards of living forward. We are apparently not smarter to do better.”

This gives us a baseline for how much an investment should grow.

If an economy rises faster than 3%, it is distorted. During early stages of excessive growth, investors will be attracted. Shares will rise faster.

If the economy remains robust, shares become overbought. Then watch out! A correction will come.

This leads us to the second fact which is “All investments have risk”.

Rather than wasting time trying to avoid risk…which cannot be done, investors should look at three risk elements instead.

#1: How much risk is there in any particular investment?

#2: What perceptions do the markets have of the risk?

#3: What risk premium is due?

Bank accounts and government bonds, for example, are perceived as the safest investments (especially if government guaranteed). A look at their long term history shows that they pay about 3%. So if a bank account or government bond pays less…in the long term it’s bad. If it pays more…that’s better. Yet the idea is that bank accounts will not really make money. They will just keep up with growth…at 3%.

To get real growth requires taking risk. If an investment appears to be less safe it will pay more than 3%. This is called a risk premium.
Bonds pay more than bank accounts because they are perceived to be less safe. Stocks pay more than bonds because they are perceived even riskier. Emerging market stocks pay more than major market stocks. Emerging market bonds pay more than major markets bonds.

Over the long run, bonds issued in countries and currencies perceived to be stable pay 5% to 7%.

Stocks in major countries should pay 7% to 10% annual return in the stock market as a function of global growth, long term earnings growth plus risk premium (above bank accounts and bonds).

To attain higher growth than 7% to 10% investors must either increase risk, trust luck or spot distortions.

This is good because the market is almost always wrong. Most investors always trying to avoid risk. Most investors dump their wealth into investments that are perceived to be safe. This creates excessive demand and lowers value and actually makes the perception wrong.

Knowing this helps wise investors spot deceits in the dimension of time.

Take, for example, the emerging market trend that has been created by an imbalance in labor costs around the world.

There are 6.6 billion people on this earth (give or take a few hundred million). 1 billion of these people live on a dollar a day. 2.5 billion live on two dollars a day. This means that there is a vast pool of cheap labor that can create goods at bargain prices. Mature economies are buying these goods at such an increased rate that 20% of all goods produced now cross a border, mostly from poor countries to the rich.

This means that emerging economies are growing much faster than 3%. They are catching up and this has caused major markets to slow down.

Yet emerging economies are perceived to have greater risk.

Smart investors have seen the value create by this distortion and have been cleaning up. They have been paid a huge risk premium when the risk has not been real!

The risk has been eliminated by low labor costs in poor countries and improvements in communications and transportation.

From 200o to 2010, the average annual return on emerging markets was 19.81% compared to 10% for major markets.

The third fact is that periods of high performance are followed by times of poor performance.

Emerging stock markets have outgrown major markets by about 7.5 times in the last seven years. Yet their economies are only growing about twice as fast.

Major markets have grown on average about 6.5% per annum for the past seven years….a little below what they should.

This has led to the point where emerging equity markets around the world correct down and major markets up a bit.

Yet in times of global panic as we have seen, all markets tend to drop. This means that at this time, major markets which may have been somewhat undervalued and should be rising are being pushed down by the drop of emerging markets (which should correct themselves).

Understanding these three facts leads us to know that a portfolio of European shares is a great bargain at this time…. but there is a special time risk.

Micheal Keppler stated in his latest major market valuation:

In my more than 30 years’ experience, I have never seen such a bad sentiment towards continental Europe. After a strong start in 2012, chances are good for a continuation of rising stock prices in general for the coming years.

If history is any guide, chances are better still for the Major Markets Top Value Model Portfolio.

This view is supported by our implicit three-to-five-year projection for the compound annual total return of the Equally-Weighted World Index, which now stands at 15.3 %, down from 17.6 % last quarter.

The upper-band estimate of 13,835 by March 31, 2016 implies a compound annual total return of 20.7 %; the lower-band value of 9,223 corresponds to a compound total return of 9.0 % p.a. Even our worst case makes equities look attractive — please see chart below, which shows the entire real-time forecasting history of Keppler Asset Management Inc. for the Equally Weighted World Index.

These numbers are based on relationships between price and value over the previous fifteen years. Given the current low levels of interest rates – real rates are negative in most places – I would like to point out that we do not have to be right with regard to the magnitude of our projections, but only directionally for investors to make money.

This is why we have been recommending High Yield shares at this time.  Most are major market equities that provide income and growth potential… plus make it easy to diversify.  This is why we are weighted into Northern European and Italian banking shares shares that we feel offer extra special value and extra risk premium.

There you have it. Understanding the 3% solution and what markets have done shows a distortion. Blue chips may be oversold more than emerging shares now.

In the long term, emerging shares will rise. Poor people remain and are willing and able to make goods that others will buy. This will push their economies higher faster than in major economies. Yet for now the three percent solution shows that major markets and high quality shares are more likely to recover from the current doldrums first.

Jyske Global Asset Managers agree. Thomas Fischer recently wrote:   We had our investment committee meeting yesterday  and we decided to sell our commodity currencies and increase exposure to dividend paying stocks.

We looked at the market and asked ourselves “Where will the money go?” and we believe investing in “global Gorillas” with world wide income, good cash flows and revenues will be the place to be. Cash pays nothing, bonds are low yielding and commodities have done nothing for 9 months.

JGAM’s latest update said:  We have decided to sell our positions in Carlsberg and FLSmidth & Co and establish new positions in Vodafone Group and Nissan Motors. Additionally, we have added to some of the existing positions in defensive and/or dividend paying stocks such as Nestlé, PepsiCo Inc., Statoil and Novartis.

Global investing has proven itself to be more profitable. Why not? Modern communications and transport coupled with a vast pool of low cost labor almost guarantees this fact. Now knowing three more facts based on the 3% solution can give you an edge when it come to taking advantage of the ups and downs in this global trend.

However we have to take into account the impact of time

A look at the Dow Jones Industrial for the past 10 years shows great volatility.

We can see this better in this long term global equity chart at www.affinity-consulting.com

Global equity markets are quote high now and we can see the formation of a head and shoulders pattern suggesting a downturn.

Investments in the overall performance of global equity markets in 1999 made a nice profit if held until 2007.   There was a window of profit taking for about one year (2006 to 2007).

What if we have another downturn and it takes as long as it did from 1999 to 2006?

Can you or your pension wait for another eight  years before you start to take funds?

This is one reason why we are more focused on good value shares (more likely to rise sooner),  good value dividend paying shares (that can provide income so they do not have to be sold at a bad time),  good value real estate (can earn rental income) and your own micro business.

Markets will rise. Markets will fall. Global population will increase and the global economy will expand.  History suggests that these are fundamentals we can depend upon unless there is a really major disaster.  However these fundamentals only work for us when we give them enough time.  Plus global institutions have enough risk now that a downturn (if the EU divides for example) may take longer than normal.

We should not rely totally on pensions that have not adequately protected against the risk of time (assuming 8%… even 7%  growth is a sure sign they have not).   The way to be sure you have extra income and enjoy life to the fullest is to have a purpose that also creates an income.

Gary

Learn how to earn from writing

Learn how to earn conducting seminars and tours

2013-2014 Super Thinking + Spanish – Writing to Sell Business Course Schedule

Schedule 2013-2014  Super Thinking + Spanish  – Writing to Sell Business Courses.

Here are photos I took of Mt. Dora…

during…

its annual arts festival. 

2013

May 17-18-19  Super Thinking + Spanish  St. Charles, MO   Single $699  /  Couple $899 (Teacher Mark Frakes)

May 18-19-20  Super Thinking + Spanish Oshawa, Ontario, Canada  Single $699  /  Couple $899  (Teacher Rick Brown) 

May 30-31 & June 1  Super Thinking + Spanish  Atlantic City, NJ   (Teacher Rick Brown)

June 14-15-16    Super Thinking  Writer’s Camp  West Jefferson, NC   (Gary & Merri Scott)

June 21-22-23  Super Thinking + Spanish  St. Charles, MO  Single $699  /  Couple $899 (Teacher Mark Frakes)

July 12-13-14  Super Thinking + Spanish  Kelowna, BC, Canada  Single $699  /  Couple $899 (Teachers Shawn & Suzanne Bandick)

August 16-17-18  Super Thinking + Spanish  St. Charles, MO  Single $699  /  Couple $899 (Teacher Mark Frakes)

August 31-September 1-2  Super Thinking Writer’s Camp  West Jefferson, NC  (Gary & Merri Scott)

September 27-28-29  Super Thinking + Spanish  St. Charles, MO  Single $699  /  Couple $899 (Teacher Mark Frakes)

October 4-5-6  Super Thinking + Writer’s Camp  West Jefferson, NC

Enroll here $799.   Couple $999 (Gary & Merri Scott)

November 15-16-17   Super Thinking + Writer’s Camp  Mt. Dora, Florida  (Gary & Merri Scott)

 

2014

January 10-11-12   Super Thinking + Spanish  Mt. Dora, Florida  (Gary & Merri Scott)

February 14-15-16   Super Thinking + Writer’s Camp  Mt. Dora, Florida

Enroll here $799.   Couple $999  (Gary & Merri Scott)

For information more contact Cheri Hall at cheri@garyascott.com

Attend all seminars and courses and more FREE or at a discount as an International club member.  See details here.

 

Here is the international investment three percent solution.

From 2005 into 2007 stock markets almost everywhere provided incredible returns. For example I work with Denmark ’s second largest bank. They are global equity experts and one of the portfolios (the Green Environment Portfolio) we created together rose 266.3% in one year. Another (The Emerging Market Portfolio) rose 114.2% in 2006 and 122.6% in 2007.

Yet in each case these portfolios also encountered gut wretching drops on their way up. That Green Portfolio for example in July 2007 dropped 103.22% in one month. The Emerging Market portfolio also moved like a yo-yo (see below).

In fact, over the last three years, despite impressive gains, there have been two periods of global market panic when almost every stock market dropped….like a stone….only to recover like a rocket ship.

The  in late 2007 we saw a huge wave of dumping shares.

This begged three questions.

#1: “Was this the big one?” Yes it was.

#2: “Will markets again recover…and when?”  They did.  In 2009 there was a huge recovery.

#3: This is an even more important question. “How can we as investors know what’s coming with at least a semblance of accuracy?”

The answer to this third question is  important because when a recovery comes, history suggests it will be sudden and dramatic.

You can see the recovery potential in the performance of the portfolios we created and tracked last year from November 2006 to October 2007. Equity markets collapsed in a month but recovered even faster. The portfolios utterly collapsed from July 20 to August 17. Then they rose between 40% and 128% in just two weeks.

If the recent stock market dive is just another short term correction, some investors will make fortunes.

We saw stocks explode up from 2003 to 2007, then crash 50% in 2008 and rise almost as much in 2009.

The gray line is the Morgan Stanley Global Stock Index… the green the performance of the State Street Global Advantage Fund.

Here are three simple facts can help you spot distortions in equity markets.

The first fact was confirmed by Alan Greenspan in his excellent book, “Age of Turbulence”.

“A major aspect of human nature-the level of human intelligence-has a great deal to do with how successful we are in gaining the sustenance for survival. As I point out at the end of this book, in economies with cutting-edge technologies, people, on average, seem unable to increase their output per hour at better than 3% percent a year over a protracted period. That is apparently the maximum rate at which human innovation can move standards of living forward. We are apparently not smarter to do better.”

That’s a huge fact. Overall we should expect the global economy to grow at about 3%.

This gives us a baseline for how much an investment should grow.

If an economy rises faster than 3%, it is distorted. During early stages of excessive growth, investors will be attracted. Shares will rise faster.

If the economy remains robust, shares become overbought. Then watch out! A correction will come.

This leads us to the second fact which is “all investments have risk”.

Rather than wasting time trying to avoid risk…which cannot be done, investors should look at three risk elements instead.

#1: How much risk is there in any particular investment?

#2: What perceptions doe the market have of the risk?

#3: What risk premium is due?

Bank accounts and government bonds, for example, are perceived as the safest investments (especially if government guaranteed). A look at their long term history shows that they pay about 3%. So if a bank account or government bond pays less…in the long term it’s bad. If it pays more…that’s better. Yet the idea is that bank accounts will not really make money. They will just keep up with growth…at 3%.

To get real growth requires taking risk. If an investment appears to be less safe it will pay more than 3%. This is called a risk premium.

Bonds pay more than bank accounts because they are perceived to be less safe. Stocks pay more than bonds because they are perceived even riskier. Emerging market stocks pay more than major market stocks. Emerging market bonds pay more than major markets bonds.

Over the long run, bonds issued in countries and currencies perceived to be stable pay 5% to 7%.

Stocks in major countries should pay 7% to 10% annual return in the stock market as a function of global growth, long term earnings growth plus risk premium (above bank accounts and bonds).

To attain higher growth than 7% to 10% investors must either increase risk, trust luck or spot distortions.

This is good because the market is almost always wrong. Most investors always trying to avoid risk. Most investors dump their wealth into investments that are perceived to be safe. This creates excessive demand and lowers value and actually makes the perception wrong.

Knowing this helps wise investors spot trends created by distortions.

Take, for example, the emerging market trend that has been created by an imbalance in labor costs around the world.

There are 6.6 billion people on this earth (give or take a few hundred million). 1 billion of these people live on a dollar a day. 2.5 billion live on two dollars a day. This means that there is a vast pool of cheap labor that can create goods at bargain prices. Mature economies are buying these goods at such an increased rate that 20% of all goods produced now cross a border, mostly from poor countries to the rich.

This means that emerging economies are growing much faster than 3%. They are catching up and this has caused major markets to slow down.

The global economy grew 5% last year…way ahead of 3%. Mature economies are growing only 2.3% each year on average….so there is a lot more growth in emerging economies. Thus emerging stock markets are growing faster than matured stock markets as well.

Yet emerging economies are perceived to have greater risk.

Smart investors have seen the value create by this distortion and have been cleaning up. They have been paid a huge risk premium when the risk has not been real!

The risk has been eliminated by low labor costs in poor countries and improvements in communications and transportation.

From 200o to 2010  average annual return on emerging markets was 19.81% compared to 10% for major markets.

Finally we come to the third fact. Periods of high performance are followed by times of poor performance.

Emerging stock markets have outgrown major markets by about 7.5 times in the last seven years. Yet their economies are only growing about twice as fast.

Major markets have grown on average about 6.5% per annum for the past seven years….a little below what they should.

This means that it is probably time for emerging equity markets around the world to correct down and major markets up a bit.

Yet in times of global panic as we have recently seen, all markets tend to drop. This means that at this time major markets which may have been somewhat undervalued and should be rising are being pushed down by the drop of emerging markets (which should correct themselves).

Understanding these three facts leads us to know that a portfolio of global shares is the most likely bargain at this time.

This is why we have been recommending High Yield shares at this time. Most are major market equities that provide income and growth potential… plus make it easy to diversify.

There you have it. Understanding the 3% solution and what markets have done shows a distortion. Blue chips may be oversold more than emerging shares now.

In the long term, emerging shares will rise. Poor people remain and are willing and able to make goods that the rich will buy. This will push their economies higher faster than in major economies. Yet for now the three percent solution shows that major markets and high quality shares are more likely to recover from the current doldrums first.

Global investing has proven itself to be more profitable. Why not? Modern communications and transport coupled with a vast pool of low cost labor almost guarantees this fact. Now knowing three more facts based on the 3% solution can give you an edge when it come to taking advantage of the ups and downs in this global trend.

Study 54 High Yielding shares in my latest international investing report “Running Risk” $49.

Gary

Belong to the International Club

Please join Merri and me.  Spread an epidemic of success… in health… wealth…. service to the community and personal fulfillment.   Be infected with positive purpose…. enthusiasm… fulfillment… extra income, profits and fun.

I invite you to join the International Club 2013-2014.  Save as much as $7,239 for as little as $177 a month.

As a club member you gain $7,792 of seminars, courses, online courses plus Spanish lessons and Ecuador tour discounts.

Join Merri and me  for seven courses and seminars that we’ll conduct in 2013 FREE.  Gain positive solutions to economic, financial and lifestyle developments.

Here are the courses you can attend at no cost.

June 14-15-16 Super Thinking Writer’s Camp, West Jefferson, NC.

August 31- Sept 1-2 Super Thinking Writer’s Camp West Jefferson, NC.

October 4-5-6 Super Thinking Writer’s Camp, West Jefferson, NC.

November 15-16-17 Super Thinking Writer’s Camp, Mt. Dora, Fl.

January 10-11-12, 2014 Super Thinking + Spanish, Mt. Dora, Fl.

February 14-15-16, 2014  Super Thinking Writer’s Camp, Mt. Dora Fl.

In addition members receive discounts on Ecuador farm tours and Spanish courses conducted by our Ateam Ecuador and Super Spanish teachers.  For example Super Spanish courses that are normally $699 are $175.  Ecuador real estate tours are reduced 20%.

Part of the courses we conduct are held on the New River in Ashe County, North Carolina.

New River

We’ll conduct three of the courses either at our farm or in this forest lodge.

50 delegates joined us.

The seminar in action.

After the seminar, International Club members join us at our home to talk with the speakers.

International Club members meeting in our home after a North Carolina seminar.

Four courses are in historic Mt. Dora, Florida.

Please join us this year through in Florida, and North Carolina FREE as an international club member… plus gain access to the agricultural tours and Spanish courses conducted by the Ateam Ecuador at a discount.

Super Thinking Spanish course at the historic train station in Mt. Dora.

There are many benefits of membership.

You (and a guest of your choice) can attend all eight of the seminars we have already set for 2013 plus any others we decide to conduct in the year ahead FREE.

As a club member you also receive seven online reports, courses and workshops worth $1,246 FREE.

The first of these seven online courses is “Tangled Web – How to Have an Internet Business,” normally sold at $299.

The second is our online course “Self Fulfilled – How to be a Self Publisher”, which has a $299 value. I am sending you this extra course free as I think it will help you have greater success. This is an extra $299 savings.

The third is our online course “International Business Made EZ” sold at $299.

You also receive fourth the 50 minute video by our webmaster David Cross on “How to Get Your Web Business Started”.

Your fifth course is the 50+ lesson course “How to Create your Own Website Using Sitesell” by Michelle Toole. (We are proud that this course was written by a student of our courses showing how well the 43 years of knowledge that Merri and I have accumulated and put into these programs can help you start your own global micro business.)

Sixth, you become a beta member in our newest online course “Event – Full Business – How to have a Seminar and Tour Business” currently offered at $349.

When you enroll, we’ll send you a password that makes the online courses easy to access at the Club website.  You can reserve as many seminars as you desire.

Five Positive Steps

Join Merri and me as we look at positive ways to prosper during 2013. Here are five ways to gain from the forces of change that can raise havoc with many.

#1: Having your own micro business for extra earnings, freedom, fulfillment and fun.

#2: Living and prospering in lower cost countries or small towns.

#3: Multi currency investing through US brokers and bankers abroad.

#4: Commodities that rise with inflation.

#5: Good value real estate…. especially multi dimensional and agricultural property.

We have specialized for over four decades in helping our readers excel in these five inflation beating opportunities.

The big benefits of belonging to the International Club are the power of repetition, updates and international friendships.  As a club member, you become friends with other members as you meet again and again.

Your first saving is on waived seminar fees for the seminars over the next year.

As you will see above and below you can attend Florida & North Carolina seminars.  If you attend just two of these seminars, the $1,799 membership fee will have already created a savings for you.

Yet there is more.  Much more.

International Club members meeting in West Jefferson for a reception after the North Carolina seminar.

Enough…. Enough with the Bad News.

Our 2013 mantra is BE POSITIVE in this negative world.  There is nothing as valuable as rarity but we need to remember that bad news sells. This means the mainstream media has slipped into offering information with an adrenaline rush.  Mayhem, murder and natural disasters.   These negative events will happen…. globally. We cannot do much about this.  Dwelling on insolvable negativity is not good for our health or wealth.

A recent quote from the Abraham Hicks website explains why nicely.

Continuing to tell stories of shortage only continues to contradict your desire for abundance, and you cannot have it both ways: You cannot focus upon unwanted and receive wanted. You cannot focus upon stories about money that make you feel uncomfortable and allow into your experience what makes you feel comfortable. A different story will bring different results: My thoughts are the basis for the attraction of all things that I consider to be good, which includes enough money, and health, for my comfort and joy.

Make 2013 Your Best Year Ever

What we can do is make ourselves Friendlier, More Compassionate, Happier, Stronger, More Energetic with greater intellect.  The way to start is to surround ourselves with successful, friendly, compassionate, happy, stronger, smarter, positive people who think as you do.

The International Club brings together experienced, like minded souls, who take a positive view and think outside the box… in constructive, thoughtful, doable ways.

Being in the club surrounds you with successful… positive… like minded souls.  This benefit alone is truly powerful stuff!

The courses you can attend free integrate Super Thinking with business and investing ideas and experience that enhance your health and wealth.

Focus on Ecuador & Smalltown USA & Canada

Learn how to create a BIG INCOME by thinking SMALL.   At the seminars you meet speakers who are attorneys and real estate experts for both Ecuador and small town USA.   You’ll rub shoulders with experts on global investing and pensions who can help you increase and protect your savings and pensions also how to increase the income you earn in positive ways you enjoy as you help your community.

(See a list of speakers you’ll meet at the club meetings along with other club members below).

Absorb  through  Osmosis

Merri and I are in our 45th year of organizing courses, seminars and newsletters about international and Super Thinking  lifestyles. The importance of this sharing… by like minded souls… was reinforced when a delegate from a course sent an email that said:

My Dearest Merri and Gary, Thank you for your most gracious hospitality last weekend. I am just thrilled at being a part of your group. You and Gary were exactly as I imagined you to be, warm friendly, kind, considerate, genuine, helpful, fun, sincere, what else can I say……I felt so comfortable in your presence and learned so much in your course. I was sad to leave the farm that Sunday afternoon. You made us all feel so welcome and cared about. You were so kind to make arrangements for a ride with the other delegates from the Charlotte Airport. They were so nice to me and so helpful, by the time the weekend was over I felt like they were my long lost brothers. Monday morning we all had breakfast at the airport together and I was so sad to see them go, I was sad the weekend was over, perhaps sad is not the right word for how I was feeling perhaps Gratitude is a better way to describe it. Grateful for having the opportunity to share the weekend with such wonderful, like minded Human Beings, in the beautiful mountains of North Carolina. Thank you Merri and Gary.  Thanks to you I now have new hope and a new direction to move forward in my life.  I know by attending your classes and conferences that through education and due diligence I will make the right choices.

This delegate’s comments about “belonging and feeling like a brother” to the other delegates is a wonderful refrain we have heard from our readers, year after year.

24 years ago Merri and I created a way that readers can join us to be immersed in a year-long learning program through our International Club.

The ideas behind this program began all those years ago in Vienna, Austria while we were conducting a course there.  One of our older delegates, had some sort of attack. The first fear was heart trouble. Several delegates took him to the hospital.  Others stayed with him there. I don’t think that delegate was alone for a minute!

What impressed Merri and me was that no one asked the delegates to help this man.

The friendships of delegates sharing many courses had just grown so strong that it was a natural reaction, just as if a family member was ill. Fortunately, it was only travel fatigue and the delegate didn’t miss a session of the course!

When you join our International Club 2013 you become part of a special family. The very first member to join the club all those years ago wrote, Thank you for the enjoyable and informative courses. I am pleased to be part of your international family and look forward to continuing my education at the next course.

His feeling struck a familiar chord. It has always been one of my greatest satisfactions to see how much fun delegates have getting together, sharing information and making friendships as we learn how to improve our health and increase our wealth.

The courses draw like-minded souls.  For this reason some delegates come back again and again. They come to learn, but also to be with their many friends made at the courses. When like-minded souls get together again and again to discuss a common purpose, magic happens! I can’t explain it in any other way-but it is true.

In a way our meetings are almost like family reunions. Perhaps it is getting together and reflecting on what has been said and what has been happening.

Learning with those who are also interested in the world creates thoughts that multiply the value of what we gain.  This is hard to describe but results are most powerful and wonderful!  This is to me is as important as the great financial benefit of attending many of our courses.

See the 2013 seminars in detail  below.

We started and have continued the International Club for 24 years because there are wonderful benefits from having repeat delegates at courses. Having repeat delegates makes the whole course somehow more exciting for all. Being a repeat delegate makes it easier to make and keep wealth and to lock in the knowledge you gain. It’s an exciting lifestyle. We have fun, gain adventure, discovery and friendships and share ways to improve our health and wealth!

You can see from the schedule above a very busy schedule for 2013. Very few club members actually attend every seminar.  Many  attend almost all of them!  Of course we hope you be with us for all of them, but even if you attend just two of the seminars, you gain considerable savings.

Another savings: Lifestyle for Two.

We want couples! As a member of the program, you are entitled to bring another person to every single course or tour. The cost for that extra person will be ZERO! You can bring whomever you wish. Bring your spouse, a friend, son or daughter, partner, accountant, adviser. You can bring the same person each time or a different person, whomever you choose to accompany you. (Accommodations and air fares relating to the courses are not included for members, delegates or their guests.)

The International Club fee of $1,799 is less than the price of two seminars.

I invite you to be a member of the International Club which allows you and your guest of your choice to attend all of these courses and tours.

Let’s prosper in these times of change. Won’t you join us in this exciting club and share Merri’s and my lifestyle for the next year? Join us at our farms and visit Ecuador. We look forward to seeing you at as many courses as possible and sharing this wonderful world of abundance and well being with you!

Gary

You can attend all of our seminar , courses online courses and more plus $1,246 of online value.  Club membership is $1,799. 

Become an International Club  Member $1,799 annual.

Attend as many of the courses below as you desire.

June 14-15-16   Super Thinking & Writer’s Camp West Jefferson, NC.

August 31- September 1-2 Super Thinking & Writers Camp at Merrily Farms, NC.

October 4-5-6 Super Thinking & Writer’s Camp West Jefferson, NC

November 15-16-17  Super Thinking & Writer’s Camp Mt. Dora, Florida

January 10-11-12, 2014 Super Thinking + Spanish  Mt. Dora, Florida

February 14-15-16, 2014  Super Thinking & Writer’s Camp  Mt. Dora, Florida

In additional Super Spanish courses will be scheduled in Canada, Mexico. and the US throughout the year.

(Dates subject to change).

Join us in 2013 and learn how to take advantage of the fact that the Sun Always Shines Somewhere

Yes, I want to become an International Club Member. 

Annual membership $1,799. Click  here.

Looking for good value in investing and business is a way to work through all the noise.

See below which equity market has had this performance and why it may be the best valued bourse in the world… plus a good value share traded on that exchange.

First, more on the value of good value investments.

Yesterday’s message War on Four Fronts looked at potential problems that could have a profound impact on our social and economic world.

If the wars on the southern border of the USA and in Korea were both to expand… what could happen and what can we do about it?

First, let’s recognize that a lot of extra money… that the government does not have… will be spent. This is not invested money.  If someone borrows to invest… the result can be good or bad… depending on how the investment does.  Borrowing to consume however almost always turns out bad.

If we take a holistic view… this is not the government’s debt. This is your debt and mine and our neighbors. That money will come out of our packets one way or the other eventually.  The charge may come in increased taxes… reduced government services… lower value of our currency or inflation… plus maybe some one off costs… defunct pensions… broken banks…. some things like this.

What we can do about this is invest in good value inflation fighting opportunities… commodities… our own micro business… real estate… or equities.

Second. realize that the volume of noise will grow. Every society has an educational system that teaches its populations how things are supposed to be.   When events do not evolve as citizens have been taught… there is much gnashing of teeth… increased noise that if listened too, deafens one’s hearing to the greater… more holistic symphony of life.

The way to block this noise is to search for value in realistic, personalized, disciplined thought.

Since one of the recent screeches that has scratched across our daily records at a loud volume is the Greek economic crisis… let’s get some positive spin from Greece… from a couple of millenniums ago… from Socrates when he made the statement that he was a “citizen of the world.”

I wrote the same thing in the 1970s (that I felt like a citizen of the world) in my first book Passport to International Profit. Honestly I believed this was an original thought. Yet as we see Socrates beat me to it by a couple thousand years. I am sure a myriad of others did as well.  Maybe there really are no original thoughts.

Anyway Socrates declared himself “a citizen of the world.”   Since the Greeks did not have jet travel in those times his view of what the world consisted of was a little more narrow than yours or mine today but what he meant was that he did not feel bound by the rules of thought of any state or government.

He was enriched by a lifetime of free-thinking and understanding of the entire world (albeit limited) around him.  This was an incredible statement, especially considering the penalty of free thought in that era.  Socrates encouraged his Greek fellows to think purely for themselves.

This was such a revolutionary concept that it did not end well for him short term.   He was tried on two charges: “corrupting the youth and impiety (‘failing to acknowledge the gods that the city acknowledges’ and ‘introducing new deities). This led to his execution.

Long term thanks to technology that makes global travel and communication, we really can be citizens of the world.  So we owe Socrates for the thought and if we march to the beat of our own drummer… we stop hearing all the noise.

Next expect the noise to be mostly negative. There is a great quote about how to overcome this problem from the Daili Lama in a recent Time interview.

He was asked: How do you stay so optimistic and faithful when there is so much hate in the world? His reply was:  I always look at any event from a wider angle. There’s always some problem, some killing, some murder or terrorist act or scandal everywhere, every day. But if you think the whole world is like that, you’re wrong. Out of 6 billion humans, the troublemakers are just a handful.

This is so true. For every negative event in this world there are millions that are positive. Yet our news system focuses on the bad.  What we can do is always keep in mind that problems create opportunity… to serve…to be fulfilled and to earn.

Third, realize that the herd will try to sweep you along.

An affirmation of this fact  can be seen in Warren Buffet’s (the ultimate value investor) testimony before a commission appointed by Congress to investigate the actions of credit rating agencies during the boom that led to the recent financial crisis.  Buffett was issued a subpoena to appear before the Financial Crisis Inquiry Commission hearing in New York because his firm Berkshire Hathaway owns more than 13% of Moody’s stock.  He said of the stock market, sub primed fueled bubble,   “I was wrong on it, too, I called it a bubble-ette. That was the wrong term to use. It was a four-star bubble.  It really was the granddaddy of all bubbles,” Buffett said.  “In boom times, even the wisest can lose their common sense, he said, noting that the scientific genius Sir Isaac Newton was a victim of the notorious South Sea stock bubble of 1720: “Rising prices are a narcotic that affects reasoning power up and down the line.” (my bold).

Here are some tips on what we can do to steady ourselves against the public current that in terms of value is almost always wrong.

These tips came from a reader who wrote:  We just returned from Omaha and the annual Berkshire Hathaway meeting with Warren Buffett.

Although we have been shareholders for years, I never carved out the time to attend…. DUMB! We will be going back next year.

I have always thought that if you are going to listen to somebody, make sure they are eating their own cooking and have created truly sustainable success. Clearly, Warren Buffett falls into this category and his insights are crystal clear, simple and make sense….. here are a couple that I found particularly useful:

1.  The key to getting rich is to create a structure or set of rules that minimizes the “Everyone else is doing it” syndrome. If everyone else is doing it, be wary!

2.  The primary key to successful investing is not the size of your circle of competence, but rather knowing where the perimeter is. Too many people drift away from what they know and in the process move from investor to speculator.

3.  The biggest single cause of the recent meltdown on Wall Street is the Business Schools and MBA Programs throughout the country. Teaching people to invest for the short term instead of owning a piece of the business will always produce gyrations and spikes in stock prices.

4.  The most recent rise in the stock market is primarily a result of low interest rates…. people can’t stand sitting on the sidelines making 2/10th of 1% on their money. Money has started flowing back into stocks because there are no alternatives and most investors can’t sit and do nothing when there is nothing to do that makes sense.

5.  Given the recent level of government intervention on top of the previously existing debt obligations in the United States, inflation is very likely. So are higher taxes. Inflation and higher taxes are the result of an the US inability to live within its means, so collecting and printing more money is the most likely answer.

6.  The real culprit in the recent economic turmoil in the US is not the US Treasury department, it’s Congress. Too much money has been spent in comparison to the amount being collected and this imbalance will result in even more pain.

7.  The problem in Greece is that it doesn’t have its own currency to print its way out of the problem…. Nor do any of the other members of the Euro. The Greece problem is likely to be repeated several times in the coming months.

8.  Long term, Warren and his long time partner Charlie Munger are HUGE believers in the US economy, which is why they just spent $29 Billion buying a railroad. Railroads will be the primary mover of goods in the foreseeable future. The better the US economy, the more goods that need to be moved. This is a long term “all in” bet on the United States economy.

For those of you who are unfamiliar with the spectacular investing results of Warren Buffett, consider this: In 1979, you could have purchased his stock for $290/share. Today it costs $120,000/share. You can read more about this incredible man and his investing philosophy by reading his annual Chairman’s Letter to Shareholders…. You should read all of them (1977-2009):  http://www.berkshirehathaway.com/letters/letters.html

For those of you addicted to speed, please remember that it took Warren 12 years (1950-1962) to make his first million…. The lesson: The goal is not to get rich…. The goal is to get rich and stay that way!

A recent message at this site pointed out that a good sign was that our business grew fast in bad times and much more slowly in good times. This is a signal that we are watching value… buying and investing more when prices are low and less when they are high.

Create your own structure set by the limits of your unique wants… needs and desires that stresses the relentless search for good value in all you do.

If that structure includes equities, then you may want to take a look at this equity market which is perhaps currently the best…

valued market in the world.

We closely follow the value analysis of Keppler Asset Management and this chart from his latest quarterly Emerging Market Value Analysis gives nine emerging markets a top value ranking.

If you are a new subscriber learn about Keppler Asset Management here.

The Czech Market has the highest dividend yield and yield is one of the most important indicators of value.

We can see a great appreciation in this market as well. In the first quarter of 2010 the Czech Market rose 26.3% in US dollars.

One good value share traded on the Czech exchange is CEZ a.s. the CEZ group traded in Warsaw as CEZ and on the Pink OTC Markets Inc: CZAVF.

The heading from their web site reads.

FROM A CZECH CORPORATION TO A MULTINATIONAL GROUP

The strategic goal of CEZ Group is to become the leader on the Central and Southeastern European electricity market. Apart from the production and sale of electricity, CEZ Group also deals in telecommunications, informatics, nuclear research, planning, construction and maintenance of energy facilities, mining raw materials, and processing energy by-products. CEZ Group currently belongs among the three largest heat suppliers in the CzechRepublic.

The parent company and core of CEZ Group is ČEZ, a. s. the largest electricity producer in the CzechRepublic, founded in 1992 by the National Property Fund. CEZ Group was created in 2003, when ČEZ, a. s. merged with several regional distribution companies. Today, CEZ Group belongs among ten of the largest energy companies in Europe, both in terms of installed capacity and number of customers. It occupies a leading position on the electricity market in Central Europe. Following the acquisition of three distribution companies in Bulgaria, one in Romania, two Polish power plants and one Bulgarian power plant, CEZ Group has become a multinational enterprise comprising of over 90 Czech and foreign companies.

See more about CEZ here.

You can see that sales are up but…

according to this Bloomberg chart, the CEZ share price is down.

This is what we look for in our search for value… businesses in a growth markets available at times when prices are low… yet business is booming.

I am not suggesting that you invest in this share. Perhaps it fits into the limits of your unique wants… needs and desires. If not perhaps it can be a role model  in how you search for good value in all you do.

See some ideas why Ecuador offers good value here.

Gary

We’ll review all the good value investing markets and good value micro business ideas at our June 24-27 Quantum wealth course in North Carolina.

How We Can Serve You

2013-2014 Super Thinking + Spanish – Writing to Sell – Investing & Business Course Schedule

Schedule 2013-2014  Super Thinking + Spanish  – Writing to Sell – Investing & Business Courses

Here are photos I took of Mt. Dora…

during…

its annual arts festival. 

Here is our Super Thinking + Spanish schedule for Summer 2013

May 17-18-19  Super Thinking + Spanish St. Charles, MO  (Teacher Mark Frakes) Get details here 

May 18-19-20  Super Thinking + Spanish Oshawa, Ontario, Canada (Teacher Rick Brown)  Get details here

May 30-31 & June 1  Super Thinking + Spanish  Atlantic City, NJ   (Teacher Rick Brown)

June 14-15-16  Super Thinking Writer’s Camp  West Jefferson, NC  (Gary & Merri Scott)

June 21-22-23  Super Thinking + Spanish  St. Charles, MO  (Teacher Mark Frakes) Get details here 

July 5-6-7 Super Thinking + Spanish  Sarasota, FL  (Teacher Mark Frakes) Get details here 

July 12-13-14 Super Thinking + Spanish Kelowna, BC, Canada  (Teachers Shawn & Suzanne Bandick) Get details here

August 16-17-18  Super Thinking + Spanish  St. Charles, MO  (Teacher Mark Frakes) Get details here 

September 27-28-29  Super Thinking + Spanish  St. Charles, MO  (Teacher Mark Frakes) Get details here 

October 4-5-6  Super Thinking International Investing & Business Seminar West Jefferson, NC    (Gary & Merri Scott)

November 15-16-17  Super Thinking +Writers Camp Mt. Dora, Florida (Gary & Merri)

 For information more contact Cheri Hall at cheri@garyascott.com

Attend all seminars and courses and more FREE or at a discount as an International club member.  See details here.

2014

January 10-11-12,2014   Super Thinking + Spanish  Mt. Dora, Florida  (Gary & Merri Scott)

February 14-15-16  Super Thinking International Investing & Business Seminar  Mt. Dora, Florida

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Value in equity markets cuts through the noise.

See below the current best value equity markets  and why the Dow’s recent drop below 10,000 was no surprise.

Merri and I do our best to avoid pollution… in our food… water and air.

Plus we try to stay away from noise and light pollution.

This is not easy in today’s crowded, artificial and noisy world.

Avoiding noise pollution is especially hard when we travel a lot.  For example at our main gateway airport Atlanta Hartsfield  we are often subjected to three or four TV stations and/or announcements all at the same time.  I do not know about you but this throws us into a state of utter confusion!  Some would call it becoming a stumbling fool.  I would have to agree but there is actually a scientific word for this noise agitation. The phenomenon is called “limited channel capacity.”  When the mind has to process more than six or seven things at once it loses its ability to discriminate at all.

So when flying… on the plane and in the airport we wear either ear plugs or Bose noise reducing headphones (though I wonder about the electro magnetic pollution from the headphones).

Our goal is to replace the noise with Baroque music… because the wrong kinds of noise anywhere can create stress.

Most of existence can be looked at in terms of frequency. Some frequencies are harmonious and balancing. Some clash and create imbalance.

A lot of music played today has the goal of imbalancing the listener.

The noise coming off stock markets can throw us off kilter as well.

We follow many types of frequencies and have been looking how frequencies affect US stock market shifts for years.

We report on these various market frequencies often so we were not surprised after our May 2010 stock market warnings to see the Dow quickly drop below 10,000… again.

This month, this site provided numerous warnings about various market frequencies that have all come together to put downwards pressure on US stock prices.  This five day chart of the Dow from www.finance.yahoo.com shows how accurate those warnings were.

If these waves represented sound.  The result? Cacophony and confusion.

We are also not surprised at the short term good news like yesterday morning’s market opening report in the New York Times.

Breaking News Alert The New York Times Thu, May 27, 2010 — 9:50 AM ET – U.S. Stocks Open Higher After Gains in Europe; S.& P. 500 Jumps Nearly 2% in First Minutes Shares on Wall Street quickly jumped at the open on Thursday, mostly on assurances by Chinese authorities that Europe would remain an important market for investment, and despite new economic data that was somewhat disappointing.

Expect the market to bounce up and down. This volatility is part of an extremely rude noise.

Yet if you see the entire score… as evidenced in this one month chart of the Dow from www.finance.yahoo.com you can see…

the tone is… down.

Many factors have suggested that the Dow is headed and it has been…. headed down.

Ignore the noise!

Enjoy a more powerful and harmonious economic  symphony instead.  Tune up your financial instruments with value.

Value is the harmonious aspect of existence that wishes to fill every void.  Value is the ecstasy that harmonizes away the agony of imbalance.

This is why once a quarter we look at a major equity market value analysis by Michael Keppler.

If you are a new multi currency subscriber learn about Keppler Asset management here.

Keppler points out that this spring global major equity markets continued their uptrend for a fourth consecutive quarter. In the first quarter 2010, the Morgan Stanley Capital International (MSCI) World Total Return Index (with net dividends reinvested, December 1969 = 100) gained 4.7 % in local currencies, 3.2 % in US dollars and 9.5 % in euros.

Over the last twelve (fifteen) months, the total returns of the MSCI World Index were 46.3 % (31.6 %) in local currencies, 52.4 % (34.2 %) in US dollars and 49.5 % (37.9 %) in euros.

The euro declined 5.7 % to 1.3531 (USD/EUR) in the first quarter. Over the last 15 months, the euro has lost 2.7 % versus the US dollar.

Fourteen markets advanced in the first quarter and four declined.

Denmark (+16.4 %), Japan (+8.6 %) and Sweden (+8.4 %) performed best.

This year’s worst performing markets were Spain (-10.2 %), Norway (-3.8 %), Italy and Singapore (both down 1.7 %).

Over the last fifteen months, all major markets covered by Keppler achieved double digit gains. Singapore (+66.7 %), Hong Kong (+64.4 %) and Sweden (+60.7 %) fared best.

Japan (+18.5 %), Italy (+20.6 %) and Spain (+24.9 %) came in last.

The Top Value Model Portfolio that follows Keppler’s analysis currently contains the following six “buy” rated countries at equal weights: Austria, France, Germany, Italy, Singapore and the United Kingdom.

Keppler’s current ratings suggest that a combination of these markets offers the highest expectation of long-term risk-adjusted returns.

Keppler added: What a difference a year makes! In last year’s Spring edition of the Major Markets Country Selection, I wrote:  “Never in the last 20 years have our implicit 3 to 5 year return projections been as high as they are now.” I finished with the sentence “Benjamin Graham’s margin of safety indicates that much better times may lie ahead for global equity investors”. Now, one year later, we have witnessed four successive positive quarters and one of the best 12-month performances of global equities ever.

As a consequence, our current 3 to 5 year total return projections for the equally-weighted World Index have dropped more than in half from 32.7 % p.a. last year to 14.7 % p.a. as of the end of March 2010.

Keppler looks at Graham’s margin off safety analysis often. This is a frequency analysis that has great meaning because it is based on solid values that in the long run an investor should expect.  Whenever the red line is below the gray line, there is good global value.   There is less that have the value now  than a year ago.   The next three to five years offer a return… but we are closing in on the danger zone so speculators must beware.

Keppler’s neutral value markets are now: Australia, Japan, Netherlands, Norway, Spain and Sweden.

The low value (sell) markets are:  Belgium,  Canada, Denmark, Hong Kong,  Switzerland and USA.

Since Keppler mentions “Benjamin Graham’s margin of safety let me add a note about Benjamin Graham’s book  The Intelligent Investor.

This is why most investors in equities should be investors not speculators. The hallmark of Graham’s philosophy is not profit maximization but loss minimization. In this respect, The Intelligent Investor is a book for true investors, not speculators or day traders. He provides, “in a form suitable for the laymen, guidance in adoption and execution of an investment policy”. This policy is inherently for the longer term and requires a commitment of effort. Where the speculator follows market trends, the investor uses discipline, research, and his analytical ability to make unpopular but sound investments in bargains relative to current asset value. Graham coaches the investor to develop a rational plan for buying stocks and bonds, and he argues that this plan must be a bulwark against emotional behavior that will always be tempting during abrupt bull and bear markets.

Market trends… bull and bear markets are noise.

During good times the noise leads to bad value. This is when most speculators incorrectly buy more.  Bad times… like now, create good value as they scare away speculators and leave the best opportunity for those who seek value and ignore the noise.

There is always value… in bad times and good and in all markets…. but look hardest for good value shares in Austria, France, Germany, Italy, Singapore and the United Kingdom now.

Learn how to get good value Ecuador airfares here.

Join us in North Carolina and learn more about value markets.

Gary

How We Can Serve You

2013-2014 Super Thinking + Spanish – Writing to Sell – Investing & Business Course Schedule

Schedule 2013-2014  Super Thinking + Spanish  – Writing to Sell – Investing & Business Courses

Here are photos I took of Mt. Dora…

during…

its annual arts festival. 

Here is our Super Thinking + Spanish schedule for Summer 2013

May 17-18-19  Super Thinking + Spanish St. Charles, MO  (Teacher Mark Frakes) Get details here 

May 18-19-20  Super Thinking + Spanish Oshawa, Ontario, Canada (Teacher Rick Brown)  Get details here

May 30-31 & June 1  Super Thinking + Spanish  Atlantic City, NJ   (Teacher Rick Brown)

June 14-15-16  Super Thinking Writer’s Camp  West Jefferson, NC  (Gary & Merri Scott)

June 21-22-23  Super Thinking + Spanish  St. Charles, MO  (Teacher Mark Frakes) Get details here 

July 5-6-7 Super Thinking + Spanish  Sarasota, FL  (Teacher Mark Frakes) Get details here 

July 12-13-14 Super Thinking + Spanish Kelowna, BC, Canada  (Teachers Shawn & Suzanne Bandick) Get details here

August 16-17-18  Super Thinking + Spanish  St. Charles, MO  (Teacher Mark Frakes) Get details here 

September 27-28-29  Super Thinking + Spanish  St. Charles, MO  (Teacher Mark Frakes) Get details here 

October 4-5-6  Super Thinking International Investing & Business Seminar West Jefferson, NC    (Gary & Merri Scott)

November 15-16-17  Super Thinking +Writers Camp Mt. Dora, Florida (Gary & Merri)

 For information more contact Cheri Hall at cheri@garyascott.com

Attend all seminars and courses and more FREE or at a discount as an International club member.  See details here.

2014

January 10-11-12,2014   Super Thinking + Spanish  Mt. Dora, Florida  (Gary & Merri Scott)

February 14-15-16  Super Thinking International Investing & Business Seminar  Mt. Dora, Florida

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There may be international investing light at the end of the tunnel… soon… but we must take care for now.

See below how this can create income in Ecuador.  Hand dyed, all natural yarn ready for beautiful sweaters.

We must take care because before we really see the international economic light, I expect one more downturn this autumn… one that will break the economic backs of many who have been just barely hanging on.

Markets and economies rise and fall in spurts and provide large influxes of  profit that create really bad fiscal and lifestyle habits that are destructive when dangerous economic ex-spurts (recessions) come long. See more about this here

The first dangerous time is when markets rise so much for so long that the general population becomes convinced that “the good life’ will last forever.   Then the second dangerous times comes in the form of a market crash.

The crash destroys many lives and finances.  Then after a year or so the markets rally on news of an economic recovery.  There is a fairly decent broad pickup, led by the consumers, government stimulation,  tax cuts and low interest-rates.   This is a knee-jerk stock market reaction, at the first sign of a healthy economy.  The stock market kicks up 10% at minimum, 30% at best. These rallies are not based on reality though. They are usually short lived.

This short term bear rally spurt is followed by another severe ex-spurt (bear market) which we should expect now.

Here are some tips to help survive such dangerous times:

First recognize that tight economies are best for making money. For example Marc Andreessen co founder of Netscape started Loudcloud, an Internet infrastructure company in a terrible recession  because there was less competition, easier access to good labor. Both businesses and employees are more realistic in tough times.

Tough times can be good because they force us to do what we should already have been doing. Human nature being what it is, we get fat when the times turn easy and seem good. Here are a few tips we should always heed, but sometimes can survive ignoring when economies boom. If we ignore them now, it is at our peril.

#1: Look for every way you can to trim expenses.

#2: Do not be inflexible or proud. Not long ago a seminar delegate told me about a friend who had risen from a zero net worth to having an Internet portfolio worth $300 million. “Then,” the delegate said, “he lost it all when the bubble burst. He went right back to where he started.” That was not quite right. That investor did not go back to where he started. He most likely acquired bad habits when he thought he was worth $300 million! Unless he shed these habits when he went broke they will make it harder for him to succeed again! In good times, we may think we deserve a certain way of life or that some things are inalienable rights. Really our only economic right it to spend a little less (maybe 90%) than we earn.

#3: Always save. No matter how tough the times, always try to save at least 10% of your income. Those who do this almost never run into economic trouble.

#4: Look harder for the silver lining. There are more in bad times than good. An old British saying is “where there is muck there is brass.”  Business is solving problems and difficult times create problems. Look for ways that you (or your investments) can help others squeeze through tight times.

#5: Be positive. One of the greatest risks in recession is a can’t win attitude. If the economy falls drastically (say 30%), you still only have to be in the top 70% to get by. The entire history of modern humanity has been one of long term growth chopped by short term recessions. Current conditions are nothing new.

#6: Remain true to your economic plan. Use three phase investing as described many times in our messages. Do not panic and stick by your investments (assuming they were made intelligently to begin). This will increase your odds of success and help you with step seven.

#7: Maintain perspective.  A USA Today article “American Workers Rethink Priorities” pointed out that many workers are taking time to rethink their grueling schedules or about pursuing work that might pay less but is more meaningful. We live in the richest, most incredible era that mankind has ever known. Our poorest have more than the richest of just centuries ago. Yet this can be hard to remember when caught in the day-to-day rush of the material rat race. Inspired investing is doing what we love and figuring out how to make money from it. We increase our odds of success and enjoy what we are doing more. When times are tough and the economy slows, this perspective can give us time to sit back for at least a few moments and ask, “What do I really want to do with the rest of my life?”

The answer is the most important asset you will ever receive.

Until next message, good global business and investing!

Gary

The greatest asset of all is the ability to earn wherever you live, which brings everlasting wealth.

This is why we offer our course Tangled Web… How to Have an Internet Business.

This is why I am giving everyone who enrolls in our North Carolina or November Ecuador International Business & Investing seminar our “Tangled Web… How to Have an Internet Business Course” (offered at $299) free.

Here are comments from a reader about the way we help:  Thank you for your inspiration and information outlining foreign banking and retirement.  Your comments and suggestions are welcome for planning the steps to evaluate the early stages of living abroad.

Join us with Jyske. Learn more about global investing, how to have an international business and diversification in Ecuador at the seminar.

Oct. 9-11 IBEZ North Carolina with our webmaster  David Cross & Thomas Fischer of JGAM

October 16-18 Ecuador Southern coastal tour Only One Place Left

Oct. 21-24 Ecuador Import Export Tour

Oct. 25-26 Imbabura Real Estate Tour

On the Ecuador Import Export Tour we visit Winter House, a boutique wool factory.

They make wonderful organic cotton and wool prodcuts with all natural dyes.

Their sweaters are very colorful and they’ll sell just one  but also ship entire loads to retialers in the US and Canada.  You can create basics or have them put together your own design.

Nov. 6-8 IBEZ Ecuador Seminar

Nov. 9-10 Imbabura Real Estate Tour

Nov. 11-14 Ecuador Coastal Real Estate Tour

Attend any two Ecuador seminar or tours in a calendar month…$949 for one.  $1,349 for two.

Attend any three Ecuador courses or tours in a calendar month…$1,199 for one.  $1,799