Argument for Green Investments


Merri and I are recently back from Jykse Bank’s 9th Global Wealth Seminar.

During the Jyske seminar I was able to meet with some really interesting people such as Bjorn Lomborg.

the-sceptical-environmentalist

Thomas Fischer and Bjorn Lomborg at the Jyske Global Wealth seminar.

Lomborg is a Danish author, academic, and environmental writer. He is an adjunct professor at the Copenhagen Business School, director of the Copenhagen Consensus Centre and a former director of the Environmental Assessment Institute in Copenhagen.  I have spoken with him at one seminar before and his ideas are worth the trip across the Atlantic.

He became internationally known for his best-selling and controversial book “The Skeptical Environmentalist”.

In 2002, Lomborg and the Environmental Assessment Institute founded the Copenhagen Consensus, which seeks to establish priorities for advancing global welfare using methodologies based on the theory of welfare economics.  He is a key figure in the Green Business and Investing trend and his book was part of the documentation that the late Michael Crichton used for his book “State of Fear”.

Listening to the many speakers confirmed that the global economy could see a double dip recession which stressed the importance of green investing and business.

Let me explain why I think that worries of a double dip make green investing especially wise at this time.

Many governments are trying to overcome the economic slow down and their excessive spending creates an economic situation where investors and businesses can be sitting ducks if they do not take extreme care.

The many massive government bailouts have not worked so well but they have pushed interest rates to record lows at the same time that monetary supply has dramatically grown.

This means that non volatile investments pay almost no return at a time when inflation could really start to raise its ugly head.   As long as the economy remains sluggish inflation is at bay… but the second business and employment begins to recover, expect inflation… lots of it.

Investors have to be really smart to gain profit and safety in such circumstances.  One way is to invest in huge problems that are so important they are beyond the recession… such as pollution… shortage of water…. global warming and such. Environmental problems are so important that their their solutions must grow even in a sluggish economy.

In other words to find safe and lucrative investments… go green!

Green investments can be profitable.  The fact that a green portfolio could be profitable was pretty well proved when I worked with Thomas Fischer and Jyske Bank in 2007 to create and track a green portfolio for a year.

Thomas chose just six shares for that portfolio… two of them Danish:

Novozymes B (Danish)

Vestas Wind Systems (Danish)

Seche Environnement (French)

Kurita Water Industr (Japanese)

Q-Cells Ag 51,000.00 (German)

Hyflux Lt  (Singapore)

You may recall how it performed.

Green Portfolio 2007     Aug 17       Aug 31          Sept 9        Sept 28       Oct 5            Oct 31
Price Rise                        110.93%     155.84%     170.22%     220.22%     236.47%     266.30%

What a year. There were some great lessons learned including how ups and downs are magnified by leverage.  The goals of that educational portfolio were threefold.

#1:  Help subscribers improve their creative skills for developing investment ideas that serve their specific needs.

#2:  Help investors learn how to stick to their good ideas and get out of their bad ones.

#3:  Help investors understand multi currency investing in big ideas because as you will see below…we may need this ability more than ever now.

Returns were breathtaking that year… way up and down…  as were the prices of a majority of shares. We saw great volatility in that portfolio.  The July drop of over 100% gave us a moment of pause, but as a percentage of the portfolio this drop was less than that of the other portfolios we tracked.

In short the green portfolio was the top performer during the good times and bad.

Beyond the performance were pleased that this portfolio attracted the attention of major institutions with the message… “investing in the environment can be very profitable.”

The important fact key to understand in these dangerous economic times is that:

#1: Risk will be higher.

#2: Volatility will be higher.

#3: Big problems create safety because you have to accept risk any way…. so make sure that you at least get plenty of upside potential.

For example… in these times of great global volatility and risk many investors have rushed into US dollar US treasury bonds.  These investments are thought to be safe but have great risk.  The US dollar could fall.  Inflation could destroy the purchasing power of these bonds.  Yet the upside even in the best of conditions is minimal.

Environmental concerns on the other are one of humanity’s biggest problems and the world is just catching on to that fact. Shares in environmental investments have risk as well, but in the best of conditions have a huge upside.

Copenhagen was a great place to think green by the way. The Danes have really put their money where their mouths are when it comes to green.

For example… they have cleaned up the harbor and canals that run through the city… so much so that one can swim in them.   During the seminar there was a big swim competition all around Parliament in the canals with thousands of Danes swimming in the canals.

Our friend Trey Morrison and his wife Courtney joined us for the seminar and Trey was so impressed with this that he decided to swim the canals himself.  We were all staying in the Marriott on the harbor  so I followed Trey out to see.  Could he really?

trey-morrison

I kinda dared him and…

trey-morrison

doubted, but with just a moments hesitation he…

trey-morrison

took the leap.

Personally Merri and I enjoyed the cleanliness of the canals and Copenhagen on one…

danish-canals

of these canal…

Gary-Scott-Copenhagen-Boat

boats with the rest of the delegates.

There were many other indicators showing how green the Danes are becoming.  They have wind turbines…

danish-wind-turbines

on land and…

danish-wind-turbines

sea.   We saw turbines everywhere as we traveled across Denmark.  The Danes get 20% of their energy overall from wind power.    Sometimes 100% of Denmark’s electricity is wind generated.

It is not surprising that two of the six shares in the green portfolio were of Danish companies.

I was also able to have a great conversation with Stephen Brunner, an American who is head of the American Chamber of Commerce in Denmark (plus he is on the board of Jyske global Asset Management).

He is also chair of the European Council of American Chambers of Commerce (ECACC), introduces this unique and dynamic organization comprised of AmChams from 41 countries.

Through four regional organizations in Asia, Europe, the Gulf Countries and Latin America, AmChams represent the concerns and interests of the business community at the highest levels of government and business in trade policy development. The common bond between AmChams throughout the world is our accreditation by the United States Chamber of Commerce – the world’s largest business federation. The AmCham worldwide network currently encompasses106 AmChams in 91 countries, each one affiliated with the U.S. Chamber of Commerce headquartered in Washington, D.C.

Established in 1963, ECACC serves as the European umbrella organization for AmChams from 41 countries – representing the interests of more than 17,000 American and European companies employing 20 million workers. Originally comprised of mostly western European countries, ECACC has expanded rapidly over the past decade, and is playing a significant role in the emerging markets in Eastern Europe and Eurasia.

gary-scott-stephen-brugger-from-Amcham

Gary Scott talks Stephen Brunner head of the Danish American Chamber of Commerce.

Lean more about the AmCham here.

Anders Stouge the director of the Danish Energy Industries Federation, a part of The Confederation of Danish Industry (known as DI) also led me to insights on how hard the Danes are working to have a sustainable environment.

The DI is the voice of the Danish industry, a private organization funded, owned and managed by 12,000 Danish companies within the manufacturing and service industries.

The DI’s mission is to provide the best possible working conditions for Danish industry and they have a long view that stresses sustainability.  The Danish Energy Industries Federation is a part of DI and consists of approximately 300 member companies that have energy as the primary area of activity. The Danish energy sector is one of the fastest growing export sectors of the Danish economy.

These companies are among others engaged in:

* extracting energy resources
* producing and distributing energy
* offering energy services
* manufacturing and developing technology and equipment for energy purposes
* offering advisory services in the field of energy

The Danish Energy Industries Federation participates in Energy Camps  which are bilateral strategy labs where the participants find common goals and develop concrete initiatives to benefit consumers and business through climate improvements.  For example one development from the Energy Camps, was to put the all public transport in the third largest city in Denmark) on bio fuel and thus secure the town a position as the worlds’ leading bio-town.

Results on reducing CO2 in Denmark have been impressive.

danish-sustainability chart

Chart from presentation on Danish energy by Lars Stouge.

Learn more about The Danish Energy Industries Federation here.

The Danish Government is also very active in sustainability and has issued a proposal called ‘Green Growth’, which focuses on the mitigation of the effects of climate changes on agriculture and the food industry sector that focuses on protecting the environment.

In 2009 the Danish Government introduced a bill called ‘Green growth” to spend over 2 billion dollars to help Danish agriculture protect the environment and nature and reduce CO2 emissions.

An Environmental Economic Council has been formed as an economic advisory body established by law in 2007. The Council has 24 members representing unions, employers, NGOs and the Danish Government.  The council is presided over by four independent chairmen normally

The Government also has ‘a green transport policy that encourages green transport including easier access to collective traffic and better conditions for bicycles.

danish-bikes

Bikes are a major form of transport in Copenhagen with bikes and bike paths everywhere.  Visiting pedestrians have to take care and remember to look for the bikes as well as the cars.   Living in England and traveling back and forth,  I learned to look left and right for traffic when walking.  In Copenhagen I almost stepped in front of a speeding bike numerous times.

All Danish public institutions are also obliged to mainstream green procurements from electric bulbs and ecological food to IT.  There is government support to redcue  consumption in wrapping and increased recycling efforts, financial support to boost eco-innovation, stimulate organic farming and funds
earmarked  for investments in new technology, sun energy; and subsidies to energy saving lagging in public buildings.

Green investing and business makes sense and Danish green companies make extra sense.  Here is a stable society… with a proven economy…sensible government and industry dedicated to sustainalbility.

Danish investments I am look at includeVestas the world’s largest wind turbine manufactuer.

Vestas saw its share price slide by more than 20 per cent in August 2010 after the compnay posted weaker than expected quarterly results and downgraded expectations for the rest of the year.  Short term downturns acconpanied by a nervous market… in a big long term opportunity creates extra proift potential.

The key is to not be a sitting duck when the shooting starts. Consider investing part of your portfolio in green investments. We are living through a period of great change whihc creates a lot of uncertainty.  We need harbors of predictability and one such harbor is technology for sustainability.

See more on having a harbor but first if you have not yet tuned in, see me… Steve Forbes and Ken Rogoff on… Jyske TV.

gary-scott-photo

Join us at our farm this October 7 to 10 to learn more about how to be a one man multi national.

Gary

How We Can Serve You

How to Have Real Safety in 2020

The most important investment you can make in 2020, is in yourself. 

Invest in more time.  Invest in less stress. Invest in greater security.That’s why four years ago we created the Purposeful Investing Course (PI) because when it comes to finances, there are only three reasons why we should invest.  We invest for income.  We invest to resell our investments for more than we had invested.  We invest to make our world a better place.

We should not invest for fun, excitement or to get rich quick, or in a panic due to market corrections.

The core model portfolio we teach in the PI Course rarely changes, but is highly diversified in thousands of shares around the world… so there is higher long term profits, less stress and greater safety.

The portfolio consists of 19 country ETFs.  During the four years since we created the Purposeful Investing Course and set up a $40,000 real time portfolio at Motif Brokers, we have held the same 19 shares and have only traded three times.

The portfolio started with $40,000 and has risen to $53,591 ($49,015 in shares and the balance in accumulated cash).

The portfolio did really well from 2015 to 2018, better than the DJI Index.  Then as the US dollar grew in strength it fell behind.

The chart below shows the actual results of thos portfolio compared with the S&P 500.

motif

 

This good value portfolio above is based entirely on good value financial information and mathematically based safety programs developed around investing models that date back 91 and 24 years.

The Pifolio is a theoretical portfolio of MSCI Country Benchmark Index ETFs that cover all the good value markets developed combining my 50 years of investing experience with study of the mathematical market value analysis of Keppler Asset Management.

In my opinion, Keppler is one of the best market statisticians in the world.  Numerous very large fund managers, such as State Street Global Advisers, use his analysis to manage over $2.5 billion of funds.

The Pifolio analysis begins with Keppler who continually researches international major stock markets and compares their value based on current book to price, cash flow to price, earnings to price, average dividend yield, return on equity and cash flow return.  He compares each major stock market’s history.

Fwd: keppler

Michael Kepler CEO Keppler Asset Management.

Michael is a brilliant mathematician.  We have tracked his analysis for over 20 years.   He continually researches international major stock markets and compares their value based on current book to price, cash flow to price, earnings to price, average dividend yield, return on equity and cash flow return.  He compares each stock market’s history.  From this, he develops his Good Value Stock Market Strategy and rates each market as a Buy, Neutral or Sell market.  His analysis is rational, mathematical and does not cause worry about short term ups and downs.  Keppler’s strategy is to diversify into an equally weighted portfolio of the MSCI Indices of each BUY market.

This is an easy, simple and effective approach to zeroing in on value because little time, management and guesswork is required.  You are investing in a diversified portfolio of good value indices.

A BUY rating for an index does NOT imply that any stock in that country is an attractive investment, so you do not have to spend hours of research aimed at picking specific shares.  It is not appropriate or enough to instruct a stockbroker to simply select stocks in the BUY rated countries.  Investing in the index is like investing in all the shares in the index.  You save time because all you have to do is invest in the ETF to gain the profit potential of the entire market.

To achieve this goal of diversification the Pifolio consists of Country Index ETFs.

Country Index ETFs are similar to an index mutual fund but are shares normally traded on a major stock exchange that tracks an index of shares in a specific country.  ETFs do not try to beat the index they represent.  The management is passive and tries to emulate the performance of the index.

A country ETF provides diversification into a basket of equities in the country covered.  The expense ratios for most ETFs are lower than those of the average mutual fund as well so such ETFs provide diversification and cost efficiency.

Here is the Pifolio I personally use.

70% is diversified into Keppler’s good value (BUY rated) developed markets: Australia, Austria, France, Canada, Germany, Hong Kong, Italy, Japan, Norway, Spain, Singapore and the United Kingdom.

30% of the Pifolio is invested in Keppler’s good value (BUY rated) emerging markets: Brazil, Chile, China, Colombia, the Czech Republic, South Korea, Malaysia and Taiwan.

The Pifolio consists of iShares ETFs that invested in each of the MSCI indicies of theseall good value BUY markets.

For example, the iShares MSCI Australia (symbol EWA) is a Country Index ETF that tracks the investment results the Morgan Stanley Capital Index MSCI Australia Index which is composed mainly of large cap and small cap stocks traded primarily on the Australian Stock Exchange mainly of companies in consumer staples, financials and materials. This ETF is non-diversified outside of Australia.

iShares is owned by Black Rock, Inc. the world’s largest asset manager with over $4 trillion in assets under management.

The fact that the Pifilios are invested in all the shares of the MSCI Index in each good value market reduces long term risk.

When the US stock market bull ends, know one knows for sure how long or how severe the correction will be.

When the bear arrives, what will happen to global and especially good value markets?

No  one knows the answer to this question.

What we do know is that the equally weighted, good value market Pifolios have the greatest potential long term and that math based trailing stops can be used to protect against a secular global stock market correction when it comes.

My fifty years of global investing experience helps take advantage of numerous long term cycles that are part of the universal math that affects all investments.

What you get when you subscribe to Pi.

You immediately receive a 120 page basic training course that teaches the Pi Strategy.   You learn all the Pi strategies, what they are, how to use them and what each can do for you, your lifestyle and investing.

You also begin receiving regular emailed Pifiolio updates and online access to all the Pifolio updates of the last four years.  Each update examines the current activity in a Pifolio, how it is changing, why and how the changes might help your investing or not.

Included in the basic training is an additional 120 page PDF value analysis of 46 stock markets (23 developed markets and 23 emerging stock markets).  This analysis looks at the price to book, price to earnings, average yield and much more.

You also receive two special reports.

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

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

The circumstances that created fortunes 30 years ago were an overvalued US market (compared to global markets) and an overvalued US dollar.  The two conditions are in place again!

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

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

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

This report sells for $29.95 but in this special offer, you receive the report, “Three Currency Patterns for 50% Profits or More” FREE when you subscribe to Pi.

Plus get the $39.95 report “The Silver Dip” free.

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

In September 2015, I prepared a special report “Silver Dip 2015” about a silver speculation, leveraged with a British pound loan, that could increase the returns in a safe portfolio by as much as eight times.  The tactics described in that report generated 62.48% profit in just nine months.

I have updated this report and “Silver Dip” report shares the latest in a series of long term lessons gained through 40 years of speculating and investing in precious metals.  I released the 2015 report, when the gold silver ratio slipped to 80.  The ratio has corrected and that profit has been taken and now a new precious metals dip has emerged.

I have prepared a new special report “Silver Dip” about a leveraged speculation that can increase the returns in a safe portfolio by as much as eight times.

You also learn from the Value Investing Seminar, our premier course, that we have been conducting for over 30 years.  Tens of thousands of delegates have paid up to $999 to attend.  Now you can join the seminar online FREE in this special offer.

This three day course is available in sessions that are 10 to 20 minutes long for easy, convenient learning.   You can listen to each session any time and as often as you desire.

The sooner you hear what I have to say about current markets, the better you’ll be able to cash in on perhaps the best investing opportunity since 1982.

seminars

Tens of thousands have paid up to $999 to attend.

In 2020 I celebrate my 54th anniversary in the investing business and 52nd year of writing about global investing.  Our reports and seminars have helped readers have better lives, with less stress yet make fortunes during up and down markets for decades.  This information is invaluable to investors large and small because even small amounts can easily be invested in the good value shares we cover in our seminar.

In this special offer, you can get this online seminar FREE when you subscribe to our Personal Investing Course.

Triple Guarantee

Enroll in Pi.  Get the basic training, the 46 market value report, access to all the updates of the past two years, the two reports and the Value Investing Seminar right away. 

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

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

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

#3:  You can keep the two reports and Value Investing Seminar as my thanks for trying.

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

Subscribe to Pi now, get the 130 page basic training, the 120 page 46 market value analysis, access to over 100 previous Pifolio updates, the “Silver Dip” and “Three Currency Patterns For 50% Profits or More” reports, and value investment seminar, plus begin receiving regular Pifolio updates throughout the year.

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

Gary