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May I outline five screwy problems that suggest that we… the public… are being screwed and… are about to be screwed more?  Then let’s share a great Ecuador solution to the mess.

gary scott medicinal garden

Start of our medicinal garden.

gary scott medicinal garden

Frank Clark and I clearing the garden site.

Sometimes I am amazed at how circumstance and intuition puts me right in the path of progress.  Numerous articles at this site are about ginseng and the value of north facing mountain farmland.  This land is mostly ignored but contains a bounty of medicinal plants such as ginseng. The land sells at low prices, but offers good agricultural or recreational opportunity.

Recently my ginseng mentor, Scott Walworth, said…” Gary you need a medicinal garden”.  Scott is a retired firemen and believes in self sufficiency. He said… “If the medical system breaks down you want to have your own pharmacy in the back yard.”  He is right.  I do… so I called our friend Frank who recently moved up on the farm and said “Here is an opportunity to play… (work) in the woods.  So I pulled the boys toys… ugh I mean serious farm implements out of the barn and we started clearing a site just above our house.

I have been working on this for the last week when, I  read yesterday’s New York Times and realized what was happening.

Many years ago I had the privilege of speaking at a seminar in Denmark with Rolf Jensen, a futurist and author of the “Dream Society” a book about the future that has come amazingly true.  One point that Jensen made stuck with me…  “You can see the future in the present”.

That thought kept reverberating as I read yesterday’s New York Times because there were  five articles that show how much the system is being used to take advantage of the majority by a few.

Fortunately a sixth article shows what we can do about this… how to survive and prosper the screwing of the nation and surprise… surprise… it had to do with medicine and gardening.

Let’s look first at the five ways we can see the public getting screwed.

Screwed #1:  The pubic is getting screwed in the economic recovery.  The first NYT article “Household Incomes Remain Flat Despite Improving Economy” by Annie Lowrey shows why this is true.   Here is an excerpt.   The poverty rate was unchanged in 2012.

WASHINGTON — Despite the addition of more than two million jobs last year, soaring corporate profits and continuing economic growth, income for the typical American household did not rise in 2012 and poverty failed to fall, new data from the Census Bureau show.
Multimedia

“The poverty and income numbers are a metaphor for the entire economy,” said Ron Haskins of the Brookings Institution. “Everything’s on hold, but at a bad level.”

Over a longer perspective, the figures reveal that the income of the median American household today, adjusted for inflation, is no higher than it was for the equivalent household in the late 1980s.

For all but the most highly educated and affluent Americans, incomes have stagnated, or worse, for more than a decade. The census report found that median household income, adjusted for inflation, was $51,017 in 2012, down about 9 percent from an inflation-adjusted peak of $56,080 in 1999, mostly as a result of the longest and most damaging recession since the Depression. Most people have had no gains since the economy hit bottom in 2009.

The recent article shows how since the end of the 2007 recession, the rich have grabbed more of the national income, at the cost of the general public, than since 1930.

Screwed #2:  One of the biggest costs for Americans is health care. A recent article showed how 17.6% of our GDP is spent on this.  That’s 2.5 times above the global average of developed countries.

The second article from yesterday’s NYT articles “Concern Over Drug Costs” by Sara D. Davis says:   Details Lacking on Prescription Drug Coverage in New Health Law

Among the most troubling questions facing consumers as they shop for insurance under the Obama administration’s new health care law is whether the plans will cover the drugs they take — and how much they will have to pay for them.  But with less than two weeks remaining until enrollment opens on Oct. 1, the answers are still elusive and anxiety is growing for consumers whose well-being depends on expensive medications.

The plans offered in the marketplaces must cover a minimum number of drugs in every treatment category, with the exact count set by a representative commercial plan, known as a benchmark plan, that is designated in each state.

But how many drugs will be offered under the plans is only a starting point. Perhaps more significant is how much patients will be asked to contribute toward the cost of those drugs. Only a handful of states have released those details, but advocates for patients with chronic diseases and those in the drug industry say they are troubled by what they have seen so far.

Now the screwing gets worse because the same NYT shows that the health system which is devastating the finances of so many may also kill them in the process and yet… little is being done about this.

Screwed #3:   The September 19, 2013 NYT article “The Antibiotic Resistance Crisis” by The Editorial Board says:  The overuse of antibiotics in medicine and agriculture has long been known to foster the emergence of germs that are resistant to drugs. On Monday, the Centers for Disease Control and Prevention issued the first solid numbers on the extent of the problem. It said that at least two million Americans fall ill from antibiotic-resistant infections each year, of whom at least 23,000 die from the infections, a very conservative estimate.

The agency warned of “potentially catastrophic consequences” unless prompt action is taken. It said that up to half of the antibiotics prescribed for people are not needed or appropriately used (as when a broad spectrum antibiotic is used instead of a more targeted drug).

Overuse of antibiotics on farms, where they are often used to promote growth and prevent disease in healthy animals, also contributes to development of resistant strains of germs.

The new report, for the first time, puts 17 drug-resistant bacteria and a dangerous fungus into three categories based on how big a threat they pose. Three were deemed “urgent threats,” including a bacterium, known as CRE, that is resistant to most drugs and kills a high percentage of people who become infected with it. Though it is rare, causing 600 deaths a year, it has been identified in health facilities in 44 states. Further spread of the germ or transfer of its resistance genes to other germs could lead to a “nightmare scenario,” the agency said. Twelve drug-resistant strains, including such common germs as salmonella, tuberculosis and MRSA, were classified as “serious threats.”

The message to me is STAY AWAY FROM HEALTH FACILITIES!

So if the system is becoming more expensive as it becomes more dangerous… who is reaping the profits?

Screwed #4:  Again an article in yesterday’s NYT “Reaping Profit After Assisting on Health Law” by Sheryl Gay Stolberggives us a glimpse of an answer. Here is an excerpt:  Washington’s health care revolving door is spinning fast as the new online health insurance marketplaces, a central provision of President Obama’s health care law, are set to open Oct. 1. Those who had a hand in the law’s passage are now finding lucrative work in the private sector, as businesses try to understand the complex measure, reshape it by pressing for regulatory changes — or profit from it.

That means boom times for what might be called an Obamacare cottage industry, providing work for dozens of former administration and mostly Democratic Congressional officials whose immersion in health policy minutiae, and friendships, make them invaluable to private business.

Reading this could make one mad or go mad.  In fact it does many… but we cannot let anger overcome our common sense.  We now also know that if we are too politically active, the IRS may come knocking at our door.

Screwed #5:  Yesterday’s USA Today front page article says: Political Rhetoric Flagged by IRS. Anti-Obama statements part of agency review.  Newly uncovered IRS documents show the agency flagged political groups based on the content of their literature”. 

I do not like these facts but am not going to let them stop us from doing what we can to enjoy a wonderful lifestyle despite these frailties in the system… which by the way are nothing new.   Remember “Atlas Shrugged”… “1984”…  “Brave New World”.

So what do we do?

Merri and I are so lucky… we have tried to live on the leading edge and tried to be one step ahead of an exciting trend that can help us stay ahead of the breakdowns in the system.  In the 70s we became leaders in multi currency investing so we and our readers were not devastated by the fall of the US dollar.  In the 1990s we fell in love with Ecuador… which has shown an incredible growth as many North Americans have chosen to vote with their feet and leave their original home.

Then we purchased farms in the USA and have been helping readers develop multi dimensional lifestyles.

Multi dimensional lifestyles with agriculture has become a big business.

Yesterday’s NYT  and USA Today showed us five ways we are being screwed, but the same NYT issue also shares a solution to all these problems… interestingly enough in “Writing to sell”.

Solution for all 5 Screws:  The NYT article “A Magazine for Farm-to-Table by Christine Haughney” shows how to be more “self sufficient”.  Here is an excerpt. The bolds are mine:  When a fledgling magazine gets former President Bill Clinton to contribute an article, you would think he would be featured on the cover. But the cover model for the current issue of the quarterly Modern Farmer is a sleepy-looking goat. Mr. Clinton is mentioned between articles on outer space farming and soil cuisine.

The magazine, which offers advice on building a corn maze and articles on the effect of climate change on lettuce and oysters, is trying to carve out a new niche on the newsstand. It edges into the food magazine sphere with luminous photography of vegetables, while articles report on straight agricultural topics more often found in farming publications like the 111-year-old Successful Farming.

Modern Farmer, which began publication in April, is trying to benefit from the first signs of growth in the total number of farms since World War II and the farm-to-table food trend that has fueled growth for farmers’ markets and community-supported agriculture. That means the magazine has attracted readers who include an Amish farmer and vegetable supplier to Whole Foods, Brooklyn rooftop farmers harvesting kale and broccoli and myriad young farmers going back to the land.

Long term readers know that we have a 252 acre farm in North Carolina and a 16 acre grove in Florida as well as a 960+ acre hacienda in Ecuador.  Broadband and the internet changed everything and allows us to support our farming efforts with our writing and seminars.

No one can totally predict the future… there are too many unseen bends in the road. Who could have predicted the internet 30 years ago?   We can though see where the paths into the future are heading now and one of the super freeways into the future in North America seems to be headed for a collision against free and low stress living.

Options include moving abroad to Ecuador.  Another is investing abroad.  Earning global can help and becoming more self sufficient is also a logical alternate path.

Gary

October 4-5-6 2013 International Investing and Business seminar provides insights into all these areas…how to invest globally for greater safety… how to write to earn… and how to create a multi dimensional lifestyle…how to move to Ecuador….  Multi dimensional sustainable living with agriculture is becoming big news so we have asked my gardening mentor here in North Carolina to come along.

He’ll have some ginseng seeds available as well as information on growing sustainable medicinal gardens.

Members of the Ateam Ecuador from the Andes and the coast will also be at the seminar.

Multi Currency Value Investing Seminar

Old Accord Creates New Profits – Multi Currency Investments.

Earn more with multi currency stock market breakouts.

Improve Safety – Increase Profits

Learn how to improve the safety of your savings and investments by selecting good value and diversified investments in a multi-currency portfolio.

Few decisions are as important to your wealth as the value of the markets and currencies you invest in.  This has been our area of expertise since the 1970s and we have worked with and advised some of the largest currency traders in the world.

Gain Protection First – Against the Dollar’s Purchasing Power Loss.  In 1913 the The Federal Reserve Act created the Federal Reserve Bank to protect the purchasing power of the US dollar, which has since lost about 94% of its purchasing power.  Here is its price compared with gold since 1900.

priced in gold

Dollar chart from pricedingold.com (1)

The Fed has let the dollar lose most of its strength plus has allowed interest rates to fall so low, that safe investments cannot keep pace with the drop in purchasing power.

multi-currency-chart

Chart from Grandfather Economic Report (2)

Many investors have forgotten about the risk of a falling dollar because the greenback has been strong for the past five years.  This temporary dollar strength came after the great recession of 2009 just as there was temporary dollar strength after the great recession of the 1980s.  Then about six years after the recession, an agreement was made by major governments to weaken the dollar.

There was a severe global economic recession affecting much of the developed world in the late 1970s and early 1980s.  The United States and Japan exited the recession relatively early, but high unemployment would continue to affect Europe and the UK through to at least 1985.  As a consequence between 1980 and 1985, the US dollar had appreciated by about 50% against the Japanese yen, Deutsche mark, French franc and British pound, the currencies of the next four biggest economies at the time. Then the governments reached an agreement and exchange rate values of the dollar versus the yen declined by 51% from 1985 to 1987.

Now the world is again in the same place.  The recession is over.  Europe is a bit behind in recovery and the dollar is higher than before the recession.

There is no reason for the greenback to be  strong.

The agreement in 1985 was called the Plaza Accord.   Over just two years the greenback dropped nearly 50% versus other major currencies.  The next accord will generate great profits for those who know what to do while it ruins the purchasing power of dollar back investments.

The strong US dollar and low interest rates have created one of the biggest stock and multi currency breakout opportunities in history.  Learn how to create a plan to profit from multi currency shifts ahead.

One reason for the potential gains is that stock markets and currency values are cyclical.  Due to low interest rates created by the 2009 economic downturn, the US and a few other equity markets have risen to some of their highest prices, ever.  These markets offer very poor value now.  The steep valuation creates incredible profit potential but also hides some enormous risks.  Learn how to develop an investing strategy based of earnings, cash flows, dividends and book values to increase potential for profit and reduce the risks.

Next Extra Profit Created by Value Breakouts

Over the history of US equity markets, the  price of overall markets have risen about 9.1 percent, respectively, compounded annually.  Yet over more than a hundred years of stock market activity,  a majority of the profits have come from just a very few dramatic breakouts.

Equity markets are ruled in the short term by emotions that create unpredictable ups and downs.  Numerous fears of defaults, worries of double dip recessions, high unemployment, concerns about fiscal cliffs, hold investors back.  Yet global population growth and advances in production and prosperity are relentless economic fundamentals that increase value.

When fear holds back a a fundamentally rising value, rising profit potential grows.  Values increase as prices stagnate.  Then markets break free and rocket upwards creating wealth, prosperity and growth.

Find out which breakouts are likely to take place next.

Stocks rise from the cycle of war, productivity and demographics. Cycles create recurring profits. Economies and stock markets cycle up and down around every 15 years as shown in this graph.

stock-Charts

The effect of war cycles on the US Stock Market since 1906.

Bull and bear cycles are based on cycles of human interaction, war, technology and productivity.  Economic downturns create war.

Here is the war stock cycle.  Military struggles (like the Civil War, WWI, WWII and the Cold War: WWIII) super charge inventiveness that creates new forms of productivity…the steam engine, the internal combustion engine,  production line processes, jet engines, TV, farming techniques, plastics, telephone, computer and lastly during the Cold War, the internet.  The military technology shifts to domestic use.  A boom is created that leads to excess.  Excess leads to correction. Correction creates an economic downturn and again to war.

Learn how the Cyber War (WWIV) may change the way we live and act and how this will affect currencies and investments.

Learn:

* How to easily buy global currencies, shares and bonds.

* Trading down and the benefits of investing in real estate in Small Town USA.  We will share why this breakout value is special and why we have been recommending good value real estate in this area since 2009.

* What’s up with gold and silver?  One session looks at my current position on gold and silver and asset protection.  We review the state of the precious metal markets and potential problems ahead for US dollars.  Learn how low interest rates eliminate  opportunity costs of diversification in precious metals and foreign currencies.

* How to improve safety and increase profit with leverage and staying power.  The seminar reveals Warren Buffett’s value investing strategy from research published at Yale University’s website.  This research shows that the stocks Buffet chooses are safe (with low beta and low volatility), cheap (value stocks with low price-to-book ratios), and high quality (stocks of companies that are profitable, stable, growing, and with high payout ratios), but his big, extra profits come from leverage and staying power.  At times Buffet’s portfolio, as all value portfolios, has fallen, but he has been willing and able to wait long periods for the value to reveal itself and prices to recover.

keppler asset management chart

This chart based on 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 outperformance 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%.

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.

Learn how much leverage to use.  Leverage is like medicine, the key is dose.  Buffett leverages his portfolio at a ratio of approximately 1.6 to 1.  This rate of expansion by the way is called the “Golden Ratio”.  It is a mathematical formula that controls the growth of most natural things; trees, the shape of leaves, the spiral of shells, as well as the way economies and societies grow.

We’ll sum the strategy, how to leverage cheap, safe, quality stocks and for what period of time based on your circumstances.

Learn to plan in a way so you never run out of money.  The seminar also has a session on the importance of having and sticking to a plan.  See how success is dependent on conviction, wherewithal, and skill to operate with leverage and significant risk.  Learn a three point strategy based on my 50 (almost) years of investing experience combined with wisdom gained from some of the world’s best investment managers and economic mathematical scientists.

Enjoy investing more with slow, worry free, good value investing.  Stress, worry and fear are three of an investor’s worst enemies.  These are major foundations of the Behavior Gap, a trait exhibited by most investors, that causes them to underperform any market they choose.  The behavior gap is created by natural human responses to fear.  The losses created by this gap grow when investors trade short term under stress.

Learn how to put meaning into your investing by creating profitable strategies that combine good value investments with unique, personal goals.

Learn how to span the behavior gap.  Behavior gaps are among the biggest reasons why so many investors fail.  Human evolution makes fear the second most powerful motivator.  (Greed is the third.)  Fear creates investment losses due to behavior gaps.  Fear motivates us more strongly than desire.  By nature investors are risk adverse, when they should embrace risk.  Purpose is the most powerful motivator,  stronger than fear and greed.  One powerful way to overcome the behavior gap is to invest with a purpose.

Combine your needs and capabilities with the secrets and the math of our good value model portfolio.

Share ideas about my good value portfolio.  My personal investment portfolio comes from a continual analysis of international stock markets and a comparison of 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.

Markets included in this portfolio are:

• Norway
• Australia
• Hong Kong
• Japan
• Singapore
• United Kingdom
• Taiwan
• South Korea
• China

These markets have been chosen based on four pillars of valuation.

• Absolute Valuation
• Relative Valuation
• Current versus Historic Valuation
• Current Relative versus Relative Historic Valuation

Learn how to use Country ETFs to easily construct a diversified, risk-controlled, equally weighted representative country portfolios in all of these good value countries.

To achieve this goal my portfolio consists of Country Index ETFs that track an index of shares in a specific country.  These country ETFs provide diversification into a basket of equities in the good value countries.  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.

This is an easy, simple and effective approach to zeroing in on value because little 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 pick and choose shares.  You can invest in the index which is like investing in all the shares in the index.  All you have to do is invest in an ETF that in turn invests passively in all the shares of the index.

Learn the results of a $80,000 share purchase cost test that found the least expensive way to invest in good value.  The keys to this portfolio are good value, low cost, minimal fuss and bother.  Plus a great savings of time.  Trading is minimal, usually not more than one or two shares are bought or sold in a year.  I wanted to find the very least expensive way to create and hold this portfolio so I performed a test.

The Test for Low Cost Trading

Research put every part of this portfolio in place, except knowing the best, easiest and least expensive way to buy.  A search for an optimal way to buy and hold boiled down to two methods.  One tactic to test was to use a unique online broker that appeared to offer the lowest cost deal.  The other approach was to use a community bank in Smalltown USA.  The small town bank that I use looks after my 401K trust account and their service is first class.  The benefit of small banks is that they still treat us as a human beings (instead of a number) and when we need, it’s easy to go right to the top to answer a question or get a problem resolved.  There are no call centers and the bank and the person looking after my account is just around the corner.

I created a test to see which offered the least expensive service.

Working with my banker in Smalltown USA,  I created two accounts, one at the online broker and the other at the bank. I placed $40,000 in each.

I set up the order for the country ETFs online, while my trust manager set up orders for the identical amounts of the same shares in his system.  Then we got on the phone, coordinated our timing and on a count of three each pushed the button “BUY”.

The results of this test  show how you can gain on any purchase of country ETFs.

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

Save $468.90 If You Act Now

Subscribe to the first year of The Personal investing Course (Pi).  The annual fee is $299, but to introduce you to this online, course that is based on real time investing, I am knocking $102 off the subscription.  Plus you receive FREE the $29.95 report “Three Currency Patterns for 50% Profits or More”, the $39.95 report “Silver Dip 2017” and our latest $297 online seminar for a total savings of $468.90.

ecuador-seminar

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 2017” 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.

Your subscription will be charged $299 a year from now, but you can cancel at any time.

Gary

 

Gary

(1) Dollar chart from pricedingold.com

(2) Grandfather Economic Report

 

Household Incomes Remain Flat Despite Improving Economy

Concern Over Drug Costs

The Antibiotic Resistance Crisis

Reaping Profit After Assisting on Health Law

A Magazine for Farm-to-Table