Tag Archive | "economic recovery"

When Value and Leadership Combine


Opportunity is squared when mathematical value and new fundamental strengths come together.

Five of the eight “Buy” developed country ETFs we hold in our “Developed Market Porfolio” are European; Germany, Italy,  Norway, Spain and the United Kingdom at equal weights. The remainder are Asian, Hong Kong, Japan and Singapore.

Those choices are made entirely based on a math based equation that looks at each markets price-to-book, price earnings, average dividend and other such price and risk-return circumstances.

That match brings good news because the portfolio is about to receive a boost due to a fundamental factor created by the pandemic. 

The New York Times article, “The Which Country Will Triumph in the Post-Pandemic World?” shows how Germany has positioned itself to gain faster, stronger e onomic recovery due to good pandemic avoidance leadership.

The article says:  Imagine a country, a major Western economic power, where the coronavirus arrived late but the government, instead of denying and delaying, acted early. It was ready with tests and contact tracing to “flatten the curve” swiftly and limited its death rate to orders of magnitude lower than that of any other major Western industrial nation. Containing the virus allowed for a brief and targeted lockdown, which helped limit unemployment to only 6 per cent. Amid a shower of international praise, the country’s boringly predictable leader experienced a huge spike in popular approval, to 70 per cent from 40 per cent.

This mirror image of America under President Trump is Germany under Chancellor Angela Merkel. Her surging popularity has politically marginalised the extreme right and extreme left. German unions have worked closely with bosses to keep factories open and working conditions generally safe (the country’s meatpacking industry was a notable exception). Merkel’s government has coordinated with all the German states to contain the pandemic and with fellow European Union members to establish a recovery fund for nations hardest hit by the virus.

The strengths Germany is showing make it the large economy most likely to thrive in the post-pandemic world.

On top of this German shares offer much better value at this time.

The MSCI German Index is selling at 1.48 Price to Book and pays a 2.34% average dividend compared to the MSCI US Index selling at 3.69 Price to Book and paying a 1.80% average dividend.

When a good value investment gains a new fundamental strength, such as Germany’s good handling of the pandemic, an additional weighting in that investment makes sense.

Gary

Add Safety & Get Paid 154% More

Get paid more now!

Current markets have turned economic history upside down.  Normally bonds pay the highest interest rates and add safety to a portfolio.  Not right now.

This chart from the New York Times article “The Mystery of High Stock Prices” (1) shows that equities pay a higher yield than bonds.

wsj.com

Most Important, Get Paid the Most Now!

Just because US stocks pay more than dollar denominated bonds, does not mean they offer the best income deal.  In fact the chart below shows that US shares pay one of the lousiest yields of the 46 stock markets we monitor around the world.

The US MSCI Index pays a modest 1.91%.  That’s a terrible yield, but better than the 1.6% you can get in AA rated corporate bonds.

Nine solid, top value stock markets (shown below) not only add diversification and the best long term profit potential, they pay 71% higher yield, 3.27% compared to the US yield of 1.91%.

This is why my core stock portfolio consists of a handful of top value share ETFs and this position has hardly changed in five years. 

Let me explain why this strategy adds safety, increases long term appreciation potential and pays almost double short term income right now.

In a moment, I’ll show how to push that yield to 4.07% per annum without adding additional risk.

keppler62020

During the past five years, I have been steadily accumulating the same good value ETFs.  I have traded only three times, so my trading costs, my fuss, fiddle and time spent have been kept to an absolute minimum.

I have been investing in iShare country ETFs.  Each one invests in the MSCI Index of one of the top (or neutral in the case of Canada and Australia) value markets above.

My strategy protects against stock market volatility and yet has potential for the best gains long term from rising share prices by holding an equally weighted portfolio of the best value based country ETFs.

The Purposeful Investing Course tracks 46 stock markets around the world into determine which markets offer the best value.

Since no one knows what the future will bring, investing in value makes the most long term sense.

Plus Value ETFs are Safer

The people who dominate stock markets include a pack of thieves.  This fact has always been true.  We were recently reminded of this fact when Wirecard AG, one of Europe’s most prestigious companies, listed on Germany’s premier stock-market index, the Dax 30 fooled everyone including its top grade, longtime auditor, Ernst & Young GMBH.

The shares in German fintech company Wirecard AG (symbol WDI fell 63.74% as it filed for insolvency proceedings, after revealing that more than $2 billion in cash missing from its balance sheet was all a fraud.  The company’s market value fell to less than €500 million from almost €13 billion in a week.

Investors have seen this type of rip off again and again, really big scams from Enron to Bernie Madoff and these are just the tip of the iceberg.

Shares in stock markets are manipulated all the time.  Stock markets (in fact almost all types of markets) are led by sharks plain and simple.  Count on this fact.  This is the nature of the beast and the number one goal of many big businesses is to take as much of your money as they can to line their pockets.

In the Wirecard AG example many  thousands of investors have seen their hard work, their thrift, their security and hopes for the future disappear, even though they seemingly did everything right by investing in a blue chip, new era, high tech company.

A study of 92 years of investment returns shows that, despite the fraud and cheating and deceit, stock markets are still a good way to make your money grow… if you invest long term and diversify.

keppler

Our Pi strategy makes it harder for cheaters to grab your wealth because it’s very hard to manipulate an entire stock market, much less a dozen or so stock markets around the world.

Manipulators have a hard time tricking an entire market, especially larger markets.  If you get the best value country ETFs, your chances of long term profits improve.

Our Purposeful Investing Course (Pi) teaches an 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.

Sticking to math based stock market value and country ETFs eliminates the need for hours of research aimed at picking specific shares.   Investing in an index is like investing in all the major shares of the market.  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 Pi portfolio consists of iShare Country Index ETFs managed by Black Rock, Inc.

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.

I am updating my plan to increase my average yield to as much as 4.07%.

My developed market portfolio has been diversified into nine developed markets: Austria, Germany, Hong Kong, Italy, Japan, Norway, Singapore, Spain and the United Kingdom.

iShares Country ETFs make it easy to invest in each of the good value markets.

The average yield of these nine markets combined was 3.27% as of June 2020.  By replacing the three lowest yielding markets, Austria (.64%), Germany (1.83%)  and Japan (2.51%)  with two better yielding neutral markets Australia (4.57%) and Canada (3.54%) the average annual yield on the entire portfolio rises to 4.07%.

4.07% is 154% higher than the 1.6% you can currently earn on AA rated corporate bonds!

The ETFs provide higher income and incredible diversification for safety, plus the highest long term profit potential.

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

There is an iShares country ETF for almost every market.

Here’s how you can create your own good value strategy.

I would like to send you, on a no risk basis, a 130 page basic training course that teaches the good value strategy I use.  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 two 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.

You also receive a 100+ 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 of all 46 markets.

This year I will celebrate my 52nd anniversary of global investing and 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 the Pi course.

Time is your friend when you use a good value strategy.  The longer you can hold onto a well balanced good value portfolio, the better the odds of outstanding success.

A 45 year portfolio study shows that holding a diversified good value portfolio (based on a  good value strategy) for 13 month’s time, increases the probability of out performance to 70%.  However those who can hold the portfolio for five years gain a 88% probability of beating the bellwether in the market and after ten years the probability increases to 97.5%.

Subscribe to the first year of The Personal investing Course (Pi).  The annual fee is $299, but to introduce you to this online, course that is based on real time investing, I am knocking $124.50 off the subscription.

Guarantee

Enroll in Pi.  Get the basic training, the 46 market value report and access to all the updates of the past two years, plus all new updates over the next year.

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 in the first two months for a full no fuss full refund.

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

Due to the COVID-19 pandemic we have cut the subscription to $174.50.  You save $124.50!

Then because this global recovery from the pandemic is going to take years, we’ll maintain your subscription at just $99 a year rather than $299.  Your subscription will be autorenewed in 2021 at $99, though you can cancel at any time.

Click here to subscribe to Pi at the discounted rate of $174.50

Subscribe to Pi today and you get a year’s subscription to Pi now, get the 130 page basic training, the 120 page 46 market value analysis, access to over 100 previous Pifolio updates, plus begin receiving regular Pifolio updates throughout the year.

Gary

(1) www.nytimes.com: mystery of high stock market prices

www.nytimes.com/2020/07/19/opinion/coronavirus-germany-economy.html?campaign_id=2&emc=edit_th_20200720&instance_id=20450&nl=todaysheadlines&regi_id=48317279&segment_id=33828&user_id=208b2cbe62eb7b536babab791d172bc7

A Special Value In the Recovery Spurt


In the last quarter, most stock markets around the world have recovered from a severe correction.  

During expanding economies, value investments tend to stumble as optimism pushes the price of growth equities ahead in a bubble of exuberance.

When economies correct, value investments often fall behind and then… as the economy recovers, a magic moment appears when value equities equalize and explode upwards and surge far ahead of the rest of the market.

You can see examples in the chart below from Keppler Asset Management that shows how Keppler’s Top Value Developed Market Portfolio enjoyed these explosive upwards spurts in 1995, 2002, and 2009.

keppler

The three month global equity correction and recovery that just took place is hard to compare to normal bull markets that often last for years, but one point that seems to stand out is the stimulation it gave to value investments.

The correction pushed value shares to a very low point and created extra value.

During the recovery there has been a special buildup in the value of value markets.

Here’s the statistics of top value developed markets over the last quarter compared to the MSCI World Growth Index(2nd)  and the MSCI US Index (3rd).

                                      Price to Book                      Average Dividend Yield

May 2020

Top Value  MSCI   Index   1.00                                             5.23%

US MSCI Index                    2.89                                             2.33%

World Growth MSCI           4.37                                            1.54%

June 2020

Top Value  MSCI   Index   1.08                                               3.57%

US MSCI Index                    3.52                                               1.91%

World Growth MSCI          5.22                                                1.16%

July 2020

Top Value  MSCI   Index   1.21                                               3.27%

US MSCI Index                    3.69                                               1.80%

World Growth MSCI         6.10                                                0.98%

A recent article at MSN.com “These ignored stocks may be poised to rebound” (1) shows how value equities might be closer to a spurt now.

Here are excerpts from the article: Buying so-called value stocks at bargain-basement prices has netted sub-par returns for more than a decade. The big winners have been popular growth stocks like Alphabet, Amazon and Netflix that keep going up despite selling at much higher valuations.

But don’t count out the market’s diamonds in the rough just yet, Wall Street fund managers and investment strategists say. These ignored stocks could be poised to play catch-up.

Value investing is buying stocks that are trading at low valuations relative to earnings, book value and

“This is one of the best times in history to buy value relative to growth,” adds Dave Iben, chief investment officer at Kopernik Global Investors. Now is the time to take advantage.”

“A lot of value stocks are selling at half of what we think they’re worth,” Iben says. “If we’re right,” Iben says, “they will double.”

Part of the current appeal of beaten-down value stocks is that they’re now cheaper compared to their growth counterparts than they’ve been in a very long time. Value stocks, as measured by their price-to-book ratio (i.e. what the company would be worth if liquidated), are trading at their lowest valuations relative to growth in at least 20 years, according to Bank of America (BofA). “Value is inexpensive,” says Jill Carey Hall, an equity strategist at BofA.

The best time to buy value stocks is during a recession, says Andrew Slimmon, managing director and portfolio manager at Morgan Stanley Investment Management. Prices get so “extraordinarily cheap” in bad times that it creates a great buying opportunity. The big money is made when value stocks go from unusually cheap to more normal valuations.

Just like the “Nifty Fifty” large-cap stocks that nobody thought could ever go down in the late 1960s and early 70s, or the overloved dot-com stocks that crashed in early 2000, a shift to value stocks can occur when growth stocks get too popular and too expensive, and investors dump them in favor of cheap stocks, says Iben. “People eventually realize that the premium prices that they’re paying have reached a level that is too high even for really good companies,” Iben explains.

Value gets too cheap to ignore

For a long time, there wasn’t enough value in value stocks to buy them. But that changed in the bear market this spring, says Christopher Harvey, head of equity strategy at Wells Fargo Securities. “Prior to the selloff in March, we hadn’t seen value stocks selling (so cheap relative to) book value in 10-plus years,” he says.

Almost all big profits in stock markets are made in unexpected short term spurts.   However its almost impossible to know in advance when the spurts will be.

The chart below for example shows that over a 93 year period that all the profits in the stock market, above the return on Treasury Bills, was captured in 6 years and 6 months of spurts. In other words on average an investor had to be in the market for those specific 80 months,  just 7% of the time, to gain all the extra profit.

keppler

Since most of the high growth spurts generally come at times of overall negative sentiment in the market, the psychology makes it difficult for most investors to time markets well.

One benefit of investing in value shares now is that you are paid more in dividends than in AA rated bonds, to wait for the next recovery spurt.

Gary

Add Safety & Get Paid 154% More

Get paid more now!

Current markets have turned economic history upside down.  Normally bonds pay the highest interest rates and add safety to a portfolio.  Not right now.

This chart from the New York Times article “The Mystery of High Stock Prices” (1) shows that equities pay a higher yield than bonds.

wsj.com

Most Important, Get Paid the Most Now!

Just because US stocks pay more than dollar denominated bonds, does not mean they offer the best income deal.  In fact the chart below shows that US shares pay one of the lousiest yields of the 46 stock markets we monitor around the world.

The US MSCI Index pays a modest 1.91%.  That’s a terrible yield, but better than the 1.6% you can get in AA rated corporate bonds.

Nine solid, top value stock markets (shown below) not only add diversification and the best long term profit potential, they pay 71% higher yield, 3.27% compared to the US yield of 1.91%.

This is why my core stock portfolio consists of a handful of top value share ETFs and this position has hardly changed in five years. 

Let me explain why this strategy adds safety, increases long term appreciation potential and pays almost double short term income right now.

In a moment, I’ll show how to push that yield to 4.07% per annum without adding additional risk.

keppler62020

During the past five years, I have been steadily accumulating the same good value ETFs.  I have traded only three times, so my trading costs, my fuss, fiddle and time spent have been kept to an absolute minimum.

I have been investing in iShare country ETFs.  Each one invests in the MSCI Index of one of the top (or neutral in the case of Canada and Australia) value markets above.

My strategy protects against stock market volatility and yet has potential for the best gains long term from rising share prices by holding an equally weighted portfolio of the best value based country ETFs.

The Purposeful Investing Course tracks 46 stock markets around the world into determine which markets offer the best value.

Since no one knows what the future will bring, investing in value makes the most long term sense.

Plus Value ETFs are Safer

The people who dominate stock markets include a pack of thieves.  This fact has always been true.  We were recently reminded of this fact when Wirecard AG, one of Europe’s most prestigious companies, listed on Germany’s premier stock-market index, the Dax 30 fooled everyone including its top grade, longtime auditor, Ernst & Young GMBH.

The shares in German fintech company Wirecard AG (symbol WDI fell 63.74% as it filed for insolvency proceedings, after revealing that more than $2 billion in cash missing from its balance sheet was all a fraud.  The company’s market value fell to less than €500 million from almost €13 billion in a week.

Investors have seen this type of rip off again and again, really big scams from Enron to Bernie Madoff and these are just the tip of the iceberg.

Shares in stock markets are manipulated all the time.  Stock markets (in fact almost all types of markets) are led by sharks plain and simple.  Count on this fact.  This is the nature of the beast and the number one goal of many big businesses is to take as much of your money as they can to line their pockets.

In the Wirecard AG example many  thousands of investors have seen their hard work, their thrift, their security and hopes for the future disappear, even though they seemingly did everything right by investing in a blue chip, new era, high tech company.

A study of 92 years of investment returns shows that, despite the fraud and cheating and deceit, stock markets are still a good way to make your money grow… if you invest long term and diversify.

keppler

Our Pi strategy makes it harder for cheaters to grab your wealth because it’s very hard to manipulate an entire stock market, much less a dozen or so stock markets around the world.

Manipulators have a hard time tricking an entire market, especially larger markets.  If you get the best value country ETFs, your chances of long term profits improve.

Our Purposeful Investing Course (Pi) teaches an 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.

Sticking to math based stock market value and country ETFs eliminates the need for hours of research aimed at picking specific shares.   Investing in an index is like investing in all the major shares of the market.  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 Pi portfolio consists of iShare Country Index ETFs managed by Black Rock, Inc.

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.

I am updating my plan to increase my average yield to as much as 4.07%.

My developed market portfolio has been diversified into nine developed markets: Austria, Germany, Hong Kong, Italy, Japan, Norway, Singapore, Spain and the United Kingdom.

iShares Country ETFs make it easy to invest in each of the good value markets.

The average yield of these nine markets combined was 3.27% as of June 2020.  By replacing the three lowest yielding markets, Austria (.64%), Germany (1.83%)  and Japan (2.51%)  with two better yielding neutral markets Australia (4.57%) and Canada (3.54%) the average annual yield on the entire portfolio rises to 4.07%.

4.07% is 154% higher than the 1.6% you can currently earn on AA rated corporate bonds!

The ETFs provide higher income and incredible diversification for safety, plus the highest long term profit potential.

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

There is an iShares country ETF for almost every market.

Here’s how you can create your own good value strategy.

I would like to send you, on a no risk basis, a 130 page basic training course that teaches the good value strategy I use.  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 two 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.

You also receive a 100+ 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 of all 46 markets.

This year I will celebrate my 52nd anniversary of global investing and 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 the Pi course.

Time is your friend when you use a good value strategy.  The longer you can hold onto a well balanced good value portfolio, the better the odds of outstanding success.

A 45 year portfolio study shows that holding a diversified good value portfolio (based on a  good value strategy) for 13 month’s time, increases the probability of out performance to 70%.  However those who can hold the portfolio for five years gain a 88% probability of beating the bellwether in the market and after ten years the probability increases to 97.5%.

Subscribe to the first year of The Personal investing Course (Pi).  The annual fee is $299, but to introduce you to this online, course that is based on real time investing, I am knocking $124.50 off the subscription.

Guarantee

Enroll in Pi.  Get the basic training, the 46 market value report and access to all the updates of the past two years, plus all new updates over the next year.

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 in the first two months for a full no fuss full refund.

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

Due to the COVID-19 pandemic we have cut the subscription to $174.50.  You save $124.50!

Then because this global recovery from the pandemic is going to take years, we’ll maintain your subscription at just $99 a year rather than $299.  Your subscription will be autorenewed in 2021 at $99, though you can cancel at any time.

Click here to subscribe to Pi at the discounted rate of $174.50

Subscribe to Pi today and you get a year’s subscription to Pi now, get the 130 page basic training, the 120 page 46 market value analysis, access to over 100 previous Pifolio updates, plus begin receiving regular Pifolio updates throughout the year.

Gary

(1) www.nytimes.com: mystery of high stock market prices

www.msn.com/en-us/finance/markets/these-ignored-stocks-may-be-poised-to-rebound/ar-BB16Fs3y

 

COVID-19 Inflation


See a special COVID-19 offer that gives a 50% discount on our “Live Anywhere-Earn Everywhere”  after this message.

“Money is like manure of very little use except to be spread.”

This quote, with minor alterations is attributed to many people including Thronton Wilder, J. Paul Getty, Winston Churchill, JRD Tata and Francis Bacon.

Since Bacon lived about 400 years earlier than the rest, he probably deserves the  credit, but Wilder added, “Money is like manure; it’s not worth a thing unless it’s spread around encouraging young things to grow.”  Getty’s modification is also useful: Money is like manure. “You have to spread it around or it smells.”

Governments are spreading a lot of money around right now, so the question is, will the trillions in handouts, grants and loans help things grow or will it smell?

Will the government handouts create inflation or deflation?

The definition of inflation is “a continuing rise in the general price level usually attributed to an increase in the volume of money and credit relative to available goods and services.”

Unless commerce gets itself running again quickly, it’s possible that we’ll see a lot of money chasing fewer and fewer products and services.

There are so many forces at play that no one knows how this will all turn out, but there’s a few expectations we can be pretty sure of.

Expectation #1: There should be inflation.

inflation

1923 50 trillion mark banknote

For guidance, let’s look at the German currency after WWI as it was relatively stable at about 90 marks per dollar during the first half of 1921.

The German government had eliminated the gold standard for its currency, but had to pay reparations for their part in WWI in gold or foreign currency.

When the first reparation payment was made in June 1921, it started an increasingly rapid devaluation of the mark, which fell in value to approximately 330 marks per dollar.

In the first half of 1922, the mark stabilized at about 320 marks per dollar.  This grew into hyperinflation, the mark falling to 7,400 marks per US dollar by December 1922. The cost-of-living index was 41 in June 1922 and 685 in December, a nearly 17-fold increase.

By fall of 1922, Germany found itself unable to make reparations payments and its strategy to pay war reparations by mass printing bank notes to buy foreign currency caused the inflation of the paper mark to increase to the point that the mark was by fall of 1922 practically worthless.

A loaf of bread in Berlin that cost around 160 Marks at the end of 1922 cost 200,000,000,000 Marks by late 1923.

By November 1923, the US dollar was worth 4,210,500,000,000 German marks.

The COVID-19 pandemic is a catastrophic economic event as is Germany’s loss in WWI.   Government spending to solve the problem leads to inflation, because governments cannot make money.  At best governments take money from one place and move it to another.   If there is no place to get money, its creation of money without production, will lead to inflation.

However, especially since this is an election year in the USA, inflation may be artificially kept down.

Expectation #2:  The world’s massive debt and taxes will  increase.

The Business Insider article “US debt and deficit will reach WWII levels” (1)  says” Publicly held debt in the US will reach $20.61 trillion by October, the Committee for a Responsible Federal Budget projected on Monday, just surpassing the US’s nominal GDP of $20.58 trillion.

The debt-to-GDP ratio will pass the previous record of 106% set in World War II by 2023, the committee added.

The US deficit will also swell to historic highs amid widespread spending on coronavirus relief.  The CRFB estimates the budget shortfall will nearly quadruple to $3.8 trillion from $984 billion in 2020.

The debt and deficit forecasts are likely conservative, the committee cautioned, as the government is poised to spend more on economic stimulus, and cheap borrowing costs could drive more Americans to take out loans.

inflation

The CNSNews.com, a politically conservative American news and commentary website founded in 1997, had an interesting commentary entitled, “Government Can’t Keep Acting Like Money Grows on Trees” (2).

Help of Last, Not First, Resort

The first wrong premise is a misunderstanding of the government’s role in a crisis. The government can and should help people in times of national emergency. However, it cannot do everything.

The federal government should be the provider of last, not first, resort. According to the Catholic principle of subsidiarity, the most local body should be first to respond to problems. Afterward, larger social units can get involved. Intermediary bodies like the family, community, associations, and churches are the normal means by which people help each other in times of crisis. They are also the least expensive as services are often given freely.

Unfortunately, these intermediary bodies are in a state of great decadence.

Throwing Money at the Problem

The second wrong premise is that throwing money at the problem will make it go away.

Engineering a Painless Crisis

The final flawed premise of those dealing with the coronavirus is their assumption that all measures must be painless. The crisis must not cause people undue suffering. To reduce the hardships, the government must try to satisfy all needs, for everyone, and at all times. Failure to do so will have political consequences.

The comment that “the most local body should be first to respond to problems” should remind us that the first place we should look for help is to ourselves.   Charity begins at home and actions that lead to a self directed, self financed, fulfilling lifestyle in good times and bad are the foundations of inner peace and happiness.

The economic recovery from the pandemic will not be painless, nor should we expect the government to fix this for us.  The time to start planning to succeed in the recovery should be now.   The place to look for the most help should be at home and within.

An article at telegram.com, a local news source in Worcester County Massachusetts for 150 years, “Government giving away trillions and nobody’s asking ‘How are we going to pay for it?’”

Even without a crisis, the question “How are we going to pay for it?” is typically unasked when it comes to the bloated military budget and the military-industrial complex, American imperialist wars, the drone program, the CIA, NSA, ICE, prisons and detention centers, both public and private, and other aspects of the coercive apparatus of the state. We also do not ask “How are we going to pay for it?” when it comes to the billions of corporate welfare dollars and other forms of “wealthfare” the US regularly doles out to the affluent. Likewise when the Republicans cut taxes on the wealthy, when Trump runs trillion dollar budget deficits, or when the Republicans balloon our national debt to over $23 trillion or about $70,000 in debt for each American.

Taxes will have to be increased, but do not expect equality.  As always a few will become richer in the recovery (you want to be part of this group) and the majority poorer.

An article from courthousenews.com “Unlimited Claims Feature in Covid-19 Bailout Will Help, You Guessed It, Millionaires” shows how the process has already begun.

Those making $1 million or more stand to benefit most from tax changes Congress adopted as part of the $2.2 trillion coronavirus-response package, according to the findings of a nonpartisan congressional report made public Tuesday.

The Joint Committee on Taxation had studied a feature of the CARES Act passed in March that allows the owners of what are known as pass-through businesses to claim as much as they want in excess business losses.

Without the cap, the nonpartisan congressional body found that nearly 82% of the benefit will go toward people making more than $1 million.  Those 43,000 households would see an average tax liability reduction of $1.6 million, according to the analysis, which also found that more than 97% of the benefit overall will go to people who bring in more than $100,000.

Expectation #3: Interest rates will become bifurcated.

What will happen to interest rates?  The huge and growing government debt is only sustainable with low interest rates.  Yet the demand for liquidity creates upwards rate pressure.  For example the home rental business at AIRBNB is suffering as the coronavirus pandemic freezes global travel, so the company has been forced to borrow.

The company just issued a billion dollar bond that gives away equity at a low price, plus borrowed another $1 billion.  The second billion dollar loan is for five years, with an interest rate of 750 basis points over the Libor benchmark, which means the current rate is about 8.5%.  However the debt was sold at a discount so the loan’s current real rate is around 12%.

What a disparity.  The current yield for  a five year US Treasury is 0.42%.  The AIRBNB five year loan rate is 12%.  I do not yet see how spreads of this magnitude will work their way through the market.   T he US government simply cannot afford to offer a 12% yield.  Investors simply cannot be told not to invest in commerce that pays about 25 times as much return as government debt.

Of course we already see the disparity that can exist.  Credit card interest rates (according to bankrate.com) already run over 17% and up to 29.99%.

Look to take advantage of low rates is you borrow and high rates is you invest!

These are a few of the outside forces to continually monitor; inflation, interest rates and taxation.

No one knows where the government, the economy or society will go, but knowing were they could go, gives us places to keep watch so we can react and adapt in this unpredictable and fluid situation.  Please understand, the outside forces are out of control and beyond our control.  The resulting recession or depression will not be painless for the majority.

We as individuals do not have to be among those who suffer.  There is a lot we can do to have a self directed, self financed, fulfilling lifestyle in good times and bad.

We can be among those who have inner peace, happiness and prosperity so we can lead our family, our friends and neighbors into better places.

I have described many of the steps that can help positively lead us through the pandemic and economic disaster in my report “Live Anywhere-Earn Everywhere”.  See details below.

Stay well. Be positive. Disaster like money, when spread around, becomes the fertilizer that encourages new things to grow and you can be part of those things.

Gary

Surviving the Siren’s Song

Live Anywhere – Earn Everywhere

How to Gain Extra Freedom – While Almost Everyone Loses Theirs.

Mythology tells us that Sirens are beautiful, creatures, femmes fatales.  They lure us with enchanting, seductive songs into treacherous, always-shifting currents and shoals ready to rip the guts of our foundation from us.

siren

The last century of technology, from steams engines to quantum computers, is our Siren.  The song has brought us unbelievable freedom.

Yet the same technology that strips away the restraints created by time and space also provides tools for those who wish to bind us in other ways.

For example, technology used to track COVID-19 will increase government use of mass surveillance.

The nations use smartphones to track us. They  even receiving support from private tech companies, like Google and Apple, who would normally oppose such invasion of our privacy.

After all who would dare not help ease the pandemic?

The problem is, once a government gets its hand on such power, it rarely lets go.   The world will slide into permanently increased surveillance.

Although the current tracking efforts may appear entirely legitimate, many pose a risk to our rights to privacy and freedom of expression.  Imagine, big brother knowing where we are, where we have been, and who we have been in touch with, even what we have said.

Another Siren is the modern technology that allows goods to speed goods and people along in a global economy.   So to does it allow the bad to enter as we can now see so well.

The COVID-19 pandemic has proven this point!

Yet we should expect the world to get better.

We should and live and earn based on that this positive expectation.

However we should also live a lifestyle that prepares us for the bad times as well as good.

For example my family really used technology to make our businesses mobile and flexible.  At age 73, I work here in Florida reaching clients globally.  I can also work at our North Carolina farm or anywhere I have access to the internet.  I have been able to work every day right even having COVID-19.

gary scott

I can hike into the woods at our farm and be working if I should desire.

My webmaster lives thousands of miles away yet we easily run the business together.

My son, an attorney in England, was trapped in the Czech Republic when the airlines shut down.  He has been able to continue his normal work from a small rural town near Vienna.  His productivity has not been diminished at all.  It may have even improved.

My daughter who lives in England is working on a project in India.   The inability for her to travel has not stopped her.

Another daughter who runs a dance/drama/singing school for children saw her classes shut down but was quickly doing lessons for the kids via Zoom.

I explain how to live and earn this way in a comprehensive report I have written entitled “Live Anywhere-Earn Everywhere”.

We have created a lifestyle… so if the world goes really sideways… we will survive and prosper anyway.  We do not give up anything much.  We can enjoy the good parts of the new economy, as we protect ourselves from what can be bad.

This lifestyle is shaped by what we do, how we do it and where we live.

The COVID-19 pandemic will create innumerable new opportunities.  Many of them offer enormous income potential and they even work well (in some cases better) in disaster scenarios.

In my family’s example, we use technology to have virtual, global businesses. We use the internet.

Where we do it is from is places where we can also have a backup business that will thrive, without government interference, in troubled times.

Let me provide two simple, concrete example.  North Carolina and ginseng.  Florida and loquat.

Ginseng is a great health root.  The demand is growing especially in China.  At times good dried Ginseng sells for $1,000 a pound!  This is an incredible and easy crop to grow.   The less care you give it, the more valuable it can become.  Yet if everything goes south, the health qualities make it an excellent barter item.  Once you know what to do with ginseng, it’s easy to grow in your back yard in northern parts of the world.

Even better, one of the best kept secrets is that ginseng and 125 other medicinal crops, that are currently unsustainable, can be grown on land in North Carolina and a couple of dozen other states that is extraordinarily cheap, yet are especially uncrowded safe and healthy.

goldenseal ginseng

Ginseng we grew in our former North Carolina back yard.  I know about growing ginseng through experience and explain why and how in the report “Live Anywhere-Earn Everywhere”.

Loquats are another example of an easy to grow crop that help promote natural health.

loquats

Here I am by one of the many loquat trees at our Florida farm.

Loquats are a great fruit for making jam and such, but the loquat leaf has amazing medicinal qualities.  Its is a registered medicine in China and due to its anti viral and respiratory system enhancing qualities has an especially  growing demand right now.   The images below from Amazon.com show that the leaves sell for about a dollar per leaf!

I have many trees on the farm but started growing loquat seedlings last year.

loquat

I have been drinking a lot of home made loquat leaf tea during the pandemic.

The report “Live Anywere-Earn Everywhere” shows specific places that reduce your living expenses, easily increases your income, makes you smarter, healthier and provides tax benefits as well. 

Learn about these specific places in our “Live Anywhere – Earn Everywhere Report”.  More important learn what makes these places special and seven freedom producing steps that you can use to find other similar spots of opportunity.

Here are some of the experiences this report shares:

The report includes a tax and career plan broken into four age groups, before you finish school, from age 25 to 50 – age 50-to 65 and what to do when you reach the age where tradition wants you to re-tire.  (Another clue-you do not need to retire and probably should not).

Lowering taxes is vital now as the massive government spending during the COVID-19 pandemic will eventually lead to increased taxation.

The report is very specific because it is about what Merri and I, our children and even my sister and thousands of our readers have done and are doing.

“Live Anywhere – Earn Everywhere” focuses on a system that takes advantage of living in Smalltown USA, but earning globally.

  • Learn about the magic of the north facing slope.   This is where Merri and I live almost half of our time.  North facing mountain land is some of the least expensive in the world but has hidden values that the report reveals.  There is a lot of this land and a lot of hidden value that you can tap.   When we bought our Blue Ridge farm (252 acres) I mentioned this to my Swiss banking friend.  “That’s bigger than the entire village where I live!” was his response.  Smalltown USA offers a last chance at having a lot of space.  By living in two Smalltown places there are enormous tax advantages as well.  One step in the system saves Merri and me over $28,345 in taxes a year.

The report shows how to buy cheap north facing slopes and create an income producing tiny home for $29,000 or less.

If you lack the $29,000 to invest, a start up using tents is even less.  These are tipis we put up at our farm before we built our first tiny home.  Learn how they can create tens of thousands of dollars in income for you.

Fwd: gary-scott-tipis

  • See ways that small businesses like Tipi rentals can create BIG tax savings as well as extra income.  For more than 30 years Merri and I have enjoyed a strong six figure income, some years more, in the millions.  Yet there have been very few years when we had to pay federal income tax.  The report lays out a three structure program and how it is used when you are in school (up to age 30), then from 25 to 50, 50 to 70  and beyond 70.   Learn why Chapter C corporations and pensions can be better than the normally recommended Chapter S.  See how new mileage log rules gives you a possible opportunity to increase your tax deductions using IRS Form 4562.  Using a two-vehicle strategy you can gain $12,976 in new deductions even if you do not have to drive one mile further or spend one additional penny on your car.
  • See how a greenhouse can help you eat better and be healthier, plus provide income and a tax deduction and be funded by a government grant.

gary-scott-farming

Our North Carolina greenhouse.

gary scott greenhouse

Our Florida greenhouse.

  • There are similar benefits from having a second home office defined in IRS publication 463 and IRS publication 587, even if your desk is a dining room table.  The report also shows how your dining room table can become an actual income producer as its creates a huge tax deduction at the same time, not to mention a great place to eat, work and lay out plans for a brighter, safer more lucrative and enjoyable future.
  • Living in this environment is also healthier, economically as well as physically.  You’ll see in the report how researchers at Harvard found an amazing correlation between living in conditions found on north facing slopes, longevity and mental health.  The researchers were quite surprised by this strong correlation that also extended into mental health.  In addition to feeling better, reducing stress and having more Joie de Vivre the places outlined in “Live Anywhere-Earn Everywhere” can help you avoid hospitals, high cost disease management (aka health care) and BIG pharma while providing an investment opportunity in three plants that have some of the fastest growing demand in natural health care.  These three plants are just one of seven business opportunities that can create multiple streams of income.
  • How changes in cell phone and internet technology eliminated the need to be in one place.   An old law that creates new opportunity for small business in small towns is available to everyone.
  • Use the specific search and purchase guide.  Construction plans are included that show how to generate first tier income that leads to five, second tier avenues of earnings.
  • How to pay off old debt and avoid new debt by avoiding spurts and embracing value. 
  • Learn seven skills that will always have value.  See how to turn First Aid, medicinal plants, hospitality, food, trees, alternate energy and writing to sell into everlasting, low stress wealth.

merrily farms

This pond we developed at our farm gave us great pleasure but also helped create a safe, healthy food supply and created a tax deduction as well as it helped us develop a trout raising business.

trout

We sold these trout at a local butcher shop.

My Guarantee

This may be the most important report I have written in 50 years.  The information is certainly the most urgent.  Do not delay.  The risks are upon us right now and you’ll understand how the final steps of the alliance are taking place as you read the current news.

To take any risk out of gaining this urgent information with my full satisfaction or money back guarantee.  If you are not totally happy, simply let me know.  I guarantee you can ask for a full refund any time within 60 days and I’ll refund your payment in full, no questions asked.

You can keep the reports as my thanks for ordering it.

Buy Live Anywhere, Earn Everywhere Report  $39.99

 

(1)  www.businessinsider.com/us-debt-deficit-reach-wwii-levels-coronavirus-economy-government-watchdog-2020-4

(2) www.cnsnews.com/commentary/john-horvat-ii/government-cant-keep-acting-money-grows-trees

(3) www.telegram.com/news/20200413/government-giving-away-trillions-and-nobodys-asking-how-are-we-going-to-pay-for-it

(4) www.courthousenews.com/unlimited-claims-feature-in-covid-19-bailout-will-help-you-guessed-it-millionaires/