Advisory Letters Worth Paying For

Lots of people want your money.
In the financial sector I think we can round it to 'everyone'.  The trick is knowing who doesn't need a dime of your money to be successful, and has an investment style you can stick with.  'Trying out' something you don't really understand or like is a sure way to get your account killed.  You'll screw up at a critical moment and miss a window of opportunity (Like I did not buying MUCH more HL when it fell to a buck AFTER we all knew it had the funding it needed to survive.. or not holding my SLW after it 'surged' to nearly $7... both were 10x gainers after I'd bought... but I didn't buy enough, or sold too soon to reap the benefit; and if I really took the time to understand them instead of just trade them I'd be much better off.)

So the first, and more important step, is to learn how to invest.  Different seasons will call for alterations - but if you are a day-trader reading financial statements isn't really a skill you need.  Nor, if you are a value investor, do you care about what a stock did 'today' (or even this week or month or year), though global and macro factors matter to you in ways day-traders don't even need to think about.

You can't live in a bubble mind you, but choosing a 'core' skill set to develop over a year will serve you the remainder of your life... and I'll eat my hat if a mutual fund using that same method can ever beat your earnings.

Here are a couple rules to help you on your way:
- Don't use real money until you've been following ideas and trades for at least three months just on paper... and then start building positions, don't invest it all over a month or anything silly.
- Throw away any copies of Forbes or Money you might have.  Do a favor to others and throw away their copies too.  Similarly, if you listen to brokerage coverage or ratings agencies you're asking for your money to be taken.

To get people started on the right path I give some recommended newsletters.  Every one of these writers has plenty of money and doesn't need yours.  THAT is exactly who you want to hire.  Different styles for different people.

Not one of these guys has failed to make their readers money over any real time period.  Here are links (and prices as of today anyway) for all the ones I'd be comfortable telling my friends and family to use (and I do):

First and Foremost:  The one stop shop that is Stansberry Research.  There is one family of newsletters alone that you must have something from.  Literally.  There just isn't a better group than this.  Read the guides and daily one-page emails they send to all subscribers and you'll become a better investor.  It's just that simple and at as little as $50/yr there is zero reason not too (other than lots of promotional stuff... but just believe in 'ad blindness' and don't worry about it. : )
http://www.stansberryresearch.com/

Investment Advisory ($50/yr) should be required reading for all investors.

...let's say you only had $250 to spend on making yourself a capable investor.  Subscribe to Investment Advisory for two or three years and spend the rest on cake.  It's that good... err... the newsletter.  I'm sure the cake would be good too, but that's not the point. (It features some 'dramatic' copywriting mind you, but very solid and actionable investments.)

True Wealth is also fairly fantastic and is $100/yr... he's a bit less 'over-the-top' than the above, and very talented.

If you are an income investor who is willing to make a couple trades a month (or week if needed), you should check out Advanced Income or Retirement Trader (either is great for any age income investor)... both are a couple thousand a year so if you like them you'll be much better off calling and asking for the lifetime subscription (about 10k?) ...they'll likely happily credit what you've spent with them recently toward that.

True Income is their bond focused offering and is the only way I'd do bonds in the market.  I've tracked it since day one and it has had results that would make most retirees cry with joy compared to bond funds, cds, or annuities.

For anyone willing to drop 10k on research, a lifetime subscription to 'everything' (or whatever the current price is) is the best freakin' money you'll ever spend.

Other great stuff (and very low key to boot):

Crazy-Active-One-Step-Short-of-Lotto:  Kevin Kerr's Commodities Watch
http://kerrcommoditieswatch.com/
...This is for active traders.  You have to be willing to have things double overnight... only to fall to a negative position three days later.  That said; Kevin is among the best there is at what he does.  If you follow his guidelines on position size I can't imagine you won't be thrilled.  $700/yr

Chris Weber and Chris Mayer's products are both fantastic values (esp. Mayer's low cost newsletter in my opinion).  ...if you can't find the right reports based on just their name you aren't the right type to use them.  They are both research/data/long-term trade folks.

Ok then.  Those are all my favorites IF you have to stay in the stock market or just like it best for some reason.  For everyone else who wants control of their investments I believe the very best option is to learn all you can about whatever opportunities you can work with and go down that road.... but those posts will come another day.

For now, if you leave a comment with TWO things you like and are comfortable with, I'd be happy to recommend some higher return way for you to improve your current (or retirement) income using that as best I can.  That could be 'talking to people' or 'doing home inspections' or 'looking at spreadsheets'... doesn't matter to me.  I'll do the best I can with it.

If this post helps you take action to improving your financial life, please leave a comment or email for me.  I really don't know who does what with things I type (thus my 'talking on the phone' preference), and it'd be quite nice to know if a couple folks lives are improved by it.

Cheers,

Joshua

History. Let it tell you when to get excited.

“We believe that the biogenic hypothesis is stronger now than when we first proposed it 13 years ago.”  ...well thank you Everett.  I hope so.  In 1996 you got lots of press for finding 'Life on Mars'.  Turns out it was terrible science that was later quietly tossed out the window and all guilty parties had to say something like 'Hmm? Oh no, I just brought them coffee, I wasn't part of THAT' for the next ten years worth of job evaluations.


So when that same crew says 'stronger now than we we first proposed' perhaps it is worthwhile to take the message with a grain of salt.  The thing it reminds me of?  History.  It doesn't repeat; but it does rhyme.


If an investment method consistently made 10% a month, or 40% a year, or any other thing without the related losses to bring things back near the mean, don't you think it'd be in use by companies and people with lots of money?  Listen.  You can beat the market.  The market isn't perfect.


But if it was as simple and fool-proof to do as just opening a currency account I'm going to go ahead and say that instead of loaning money to people for things like cars (that lose value rather quickly) financial firms would find a way to get in on that involving their own funds; instead of making their profits from providing you the 'opportunity'.


Realize the most common way to build wealth is slowly.  The most common way to lose wealth is quickly.


Put in the time.  Learn the ropes and who to listen to.  Review track records (the good and the bad, and the amount of up-and-down to get there).  Test.  Being small makes some things harder; but a bunch of things easier.  Avoiding the bad is the easiest way to profit from the good.


Cheers,


Joshua

Hello Silverdome, welcome to the show (and you're just a bit part)

Wanna buy a full on, had-a-Superbowl-in-it stadium for less than one percent of the construction and upkeep costs?  Too late.  Our friends to the north have scooped up the Silverdome in Pontiac, MI, for just under 600k.  ...Yes, while some folks out there have spent that on a two bedroom house with no garage down in Cali, some folks bought a whole stadium for that and now (rather optimistically) plan to field a soccer team there.

Oh I wish my IRA for real estate had more cash in it.  See, these types of things happen now and again.  There is a hotel in my area worth a great deal to the right people and selling for a song (not the asking price mind you; but what they'd sell it for).  You can do well in stocks of course.  I personally like things I can see, touch, and work a deal on.

More what I wanted to touch on today was the cost of waiting, and the price of pride.  See, Pontiac had the chance to see that stadium for $20,000,000... several times.  In total they've had at least 7 on-paper offers.  The issues ranged from feeling that wasn't 'enough' (waiting and pride in that error), to terrible city administration (more of the pride) and beyond.

The result is that the city of Pontiac has wasted years and lost more than $25 million that it could have had (previous offers + expenses on the property during the interim).

Unfortunately we've seen this show before, and it isn't over.  Cities across the globe have an issue; people with no business sense are running the business of the city.  The results are comedic; but not when it's your tax dollars being lost.  You can profit from all this though... at least get back the money they took in taxes.

A quick game plan:
Use your skills and knowledge to be on the lookout for deals.  Be patient.  The best investors (in stocks, real estate, tax liens, or otherwise) wait to pull the trigger.  Learn the ropes.  Prepare all your documents and numbers.  Watch deals go by.  Wait.  There will be plenty of chances over the next two or three years realistically.

Use experts in their fields to help you either each time, or to train you.  Consult.  Find a couple folks with opposing few points and listen to them... they are either wrong and you can prove it (to yourself; no need to bother them) or they will show you something you missed and save you untold sums of cash.

Have your money available to act.  Do it.  Gain or loss... learn.  Do it again and again.  Extra points if you focus on a way or arena that could allow you to take advantage of such pricing anomalies in other nations; particularly if you have knowledge of said other nation.  Do that a couple times and you could have a whole new business.

Anyway, the city of Pontiac is a tragic place whose mayor either has a friend in Canada, or could use one.  Be smarter than them about when to sell, and take advantage of opportunities to secure your retirement by being on the lookout.  'Lazy' investors won't like these next ten years too much.  Don't be one of them.  Learn, get equipped, and rock it.

As always, comment, ask questions, or whatever and I'll email or post back accordingly.

Cheers,

Joshua

Doug Casey found a great quote from yesteryear; most of our problems in one paragraph.

"The boom produces impoverishment. But still more disastrous are its moral ravages. It makes people despondent and dispirited. The more optimistic they were under the illusory prosperity of the boom, the greater is their despair and their feeling of frustration. The individual is always ready to ascribe his good luck to his own efficiency and to take it as a well-deserved reward for his talent, application, and probity. But reverses of fortune he always charges to other people, and most of all to the absurdity of social and political institutions. He does not blame the authorities for having fostered the boom. He reviles them for the inevitable collapse. In the opinion of the public, more inflation and more credit expansion are the only remedy against the evils which inflation and credit expansion have brought about."
-Ludwig von Mises, Human Action, 1949

Want to know what our nation (or most any other nation) is going to do next?  Read it again.

Inflation? Deflation? Should you even care?

Inflation? Deflation? Should you even care? ...as I am obligated to pick sides I will. Then we'll move on to the strange-but-true proposition that perhaps it doesn't really matter. (Yes, for the below purpose we'll stick with the familiar uses of the words and not their definitions... if we did that there is no debate and that takes all the fun out of it.)

We've got more deflation to deal with. Commercial real estate troubles are enough by themselves to keep capital markets in check for some time. That says nothing of the ARM resets that should keep us hopping for the next couple years. Cars, homes, businesses, and more should cost less over the next year or so. This doesn't mean boring things that you use, like food, won't be climbing all the while.

That said, once reality does take hold and we are no able to run in the air by moving our legs really really fast, inflation will set in. Lots and lots of it. That's good news if you have giant piles of debt, a garden, and a limited income. It's not so good for most everybody else. It isn't bad for everyone, but it sure helps a limited number of people.

Why should you not really care? Well, because. You have better things to do with your time; and some well chosen investments will improve your lot no matter which way the wind blows. So below I've broken the vast investment world into three groups so you can know what you should be excited about based on your beliefs (you're welcome):

Things the 'inflation' crowd love to buy:

• Things with lots of long-term fixed rate debt.
• Things with lots of pricing power (they can charge what they want).
• Gold, silver, and bunkers (I'm kind-of kidding about the bunkers).
• Assets that are hard to replace or duplicate.
• Quality properties.

Things the 'deflation crowed love to buy:

• Long-term fixed rate debt.
• Nothing (hold the cash).
• Assets that are hard to replace or duplicate.
• Bumper stickers that say things like 'Gold is a Barbaric Relic' (I'm kind-of kidding about the bumper stickers).

Things you should be buying (understanding values of all manner of assets are going to be tossed around over the next 1,3,5, and 10 years as we (hopefully) finish working our way through this mess):

• Companies with pricing power.  That'd be like a railroad with few/no competitors in it's area.  A major cell network provider. A company that generates power.  A payment processor with an unmatched network.
• Assets that are hard to replace or duplicate.  That'd be the above (really)... and things like quality farmland, companies with strong intellectual property portfolios, water rights, prime commercial property (watch your entry price) and perhaps well positioned energy transport or production facilities.
• Assets priced and based in non-US currencies and locations.  What better way to stay out of the mess than just keeping funds as far from the center of the flux as possible?  Anything that happens here will influence prices and business worldwide... but you can still do well by giving yourself a degree of separation.

So there you go.  Know that there are going to be some very (very) sad pandas on either side of the inflation/deflation thing.  I suggest 'bravely sitting this one out' and not going too gung-ho on either side.  Inflation will win; but it might take awhile.  Instead, just focus on quality holdings that will do well in any environment.  Not very exciting I know; but it will be very (very) profitable long-term.

...you may now feel free to open an account at BOOM Securities, Saxo, EverBank, or even BullionVault.  I would humbly suggest you check-out CompleteIRA.com.  We will help you with a host of ideas of non-stock investments that are of very high quality, and create an IRA or 401k that can work with those things easily.

Investing in quality assets that are easy to work with and understand.  See?  Inflation or Deflation?  Doesn't really matter.

Joshua

(As I can't seem to help myself and its my blog:  inflation - by its very definition - we're going to have long-term inflation. Get thee some quality assets!)

Score! Made it to 100! (not that I was worried)

It didn't really seem like too tall an order.  At least 100 US bank failures in 2009.

I was a little nervous once the FDIC publicly said it was broke and was forcing mergers... I mean, I'd still have been right - but they wouldn't have technically 'failed'; just 'merged' with a somewhat-less-broken bank.

Well, with the passing of last Friday, all is as it should be.  Carry on dear reader.  (Assuming you've pulled out the emergency cash-money I suggested doing earlier... if not, this is a fine time to do so.

...as a bonus, be watching Zion (you should consider shorting it if you're into that kind of thing, or if you're like me and would rather have defined risk, ponder buying long dated puts).  It's fallen, but much like a handful of publicly traded homebuilders, or Met Life, even at 'bargain' prices it's over priced (also some good puts to look at).  Ok, sorry for that aside, but free money isn't as bad as it's made out to be.

In other news, the weather is fantastic, and I am getting only some of what I was trying to get done today done.  Off I go.

It's all about timing

Winter has come.  The thick morning fog is here, the wind has come, and my driveway is covered in needles and leaves.  What will follow is pretty predictable, and though I can't give you a day it'll happen, in general it'll get colder for awhile, snow, and then Valentine's Day will be upon us.

Don't you wish investing matters were as easy to read?  They can be.  I'm not saying anything is 100% (maybe it won't snow after all), but you can sure come close.  Just like in 'Groundhog's Day' things that shouldn't have any reason to repeat... do.  What we're going to talk about today isn't a specific trade; just a different way to think about things.  Timing works.  It usually works better than 'buy and hold'.  Just don't get picky.

The thing is most people are working really hard at timing things exactly.  That is hard.  Timing things 'vaguely' is a lot easier.  For most people that also means a lot more profitable.  Let's look at the crazy ups and downs in oil for an example... When oil got to be $120+ a barrel it was pretty clear that things just couldn't 'work' the way they always had at that price.

If you shorted or bought long dated put options you would have promptly started losing money as it just kept climbing... but once it fell below $60 or so you had made a very large sum  indeed.  If you carefully watch stops you might have held all the way down to $40 or so.  Could you have timed it perfectly at taken it down to 33 dollars a barrel?  I doubt it.  Once it got super cheap (say $40 or so) you'd have lost money buying it, or buying long dated calls... as it fell further down.  Of course now that is at $80 less than a year later it seems to have worked out just fine.  Could it go back up to $120?  Sure.  If you do stay long (I am), just watch your stops so that when it does turn you can exit the trade well instead of wishing you'd sold sooner.  Should you buy or sell right now?  Well, right now the technicals say 'buy'... but to me we're on the 'thinking about selling' side of the easy trade, the 'time to buy' side of it was back near $40.  That is the difference.  The short term timing guys are all piling in now... right when I'm looking to get out.  Maybe they'll make a killing... but I know some of them will get killed instead.  I'd rather just take the 'easy' trades.  There are enough of them out there.

So that is the message today.  Think longer term.  Stick with easy trades.  They can (and do) still lose money now and again, but if you buy things that are trending properly at good prices, and if you sell things that are sliding from high prices, you'll do very well.  Don't try and pickup quarters in front of  a steamroller.  Timing 'big picture' situations is easier than day trading.  And easier means more profit for most people.

Of course this method doesn't need the best self directed IRA on the planet, allowing you do invest in all kinds of things, but that's ok, there is good reason to self direct with some money, and leave some in the market.  Today I focused later.  We'll cover more on the former soon... That arena being the most fun on many different levels.