How willing are you to benefit from whatever is changing? Some focus directly on identifying relevant changes, so they notice relevant changes early. By noticing relevant changes early, those who are most willing to benefit from change will have begun to adapt their own behavior long before most people even notice what has been changing.
Focus on identifying relevant changes. Notice early. Adapt first. Benefit most.
Are you willing to be one of those who benefit most from whatever is changing? Let’s consider a few examples of what I mean by “benefit most.”
In 2002, I discovered the research of Jim Shepherd. From 1982 until now, he has been operating an investment service focused on benefiting by noticing changes early. Let’s compare his results to some typical results.
While the Dow Jones Industrial Average is more than 16 times higher than it was in 1982, Jim Shepherd’s basic long-term conservative advice has produced an increase of more than 6000% (over 60 times the initial investment in 1982).
How? By selling prior to major declines in stock prices
and then buying back in to stocks
after the declines were “mature.”
But how did he know major declines were coming before they began (or when they were over)? He simply used two very powerful tools: math
Consider, however, that many others used those same tools to produce much worse results. So what made the difference for him? Maybe it was his willingness to benefit from change- as in his commitment to adaptiveness.
By the way, in addition to those long-term conservative exits from the stock market when it was ripe for a decline, Jim Shepherd also noticed a few especially lucrative opportunities when stocks were ripe for a very sudden decline, such as in 1987. Not only did he exit stocks before the decline as part of his long-term conservative strategy, but he also entered some short-term aggressive positions. By identifying exceptional opportunities, he produced gains in very short periods of time that exceeded the gains that it took the Dow Jones Industrial Average three decades to produce.
Once I saw his track record and studied his research, I recognized the simplicity of his perspective.
For the last 9 years, I have frequently monitored his research and he remains the person that I consider to be the most credible investment researcher alive. I appreciate many others, such as Robert Prechter
(who was also famous for forecasting the stock crashes in 1987 and 2007, as did Jim Shepherd), but there is no one that I know of who can match Jim Shepherd’s three decade record of accuracy.
However, investment forecasts are most relevant for investors, right? While both Shepherd and Prechter forecast the decline in real estate prices years in advance, what about for people who do not have the credit scores to
speculate in real estate or the cash to invest in stocks?
Wouldn’t it have been valuable to know in advance years before fuel prices
would be making historic highs? How valuable would it be to know specific ways to adjust budget priorities, to shelter finances, and to use legal systems to the maximum benefit? Would you like to know which industries are ripe to grow because of the next changes to the global economy? Do you know which industries are about to contract as fuel prices rise further, pinching credit markets and governments and households?
I have been publishing reports since 2003 on the emerging major changes in global economics. First, I warned about in particular about emerging instability in real estate lending and prices, also focusing attention on booming commodities and a stock sector that rose over 1600% from 2000 to 2010.
In 2004, I wrote “The Real U.S. Deficit: Oil,” in which I first used the term “The DominOIL Effect” in detailing why fuel prices would continue rising and how those spiking fuel prices would effect the US economy in general as well as specific things like stock prices and real estate prices. Many people benefited from reading that publication and acting in harmony with logic and math, but those most willing benefited much more than those least willing (least committed). Many others did not follow the recommendations and soon even went bankrupt by continuing to confidently gamble on financed real estate speculations.
Next, in 2005, I wrote “Worth its weight in… OIL!” in which I contrast the simple priority of fuels like gasoline over the inflated speculative bubbles in precious metals, real estate, and stocks. I compared the immediate functional value of gasoline to irrational exuberance about chunks of shiny metal or promises on paper, such as unfunded insurance policy guarantees or exclusive real estate titles enforced by the armed mercenaries of the local county court. I forecast that rising fuel prices would pop the credit bubble and reverse decades of the discounting of currency, such as the rebound in purchasing power of the Japanese Yen began in 1989.
Note that, to me, insurance policy promises are just credit, since no new money has been created to fulfill the immense contractual promises that insurance companies tend to make in exchange for a few hundred dollars here and there. Obviously, real estate prices are primarily dependent on credit (as in borrowing), but the insurance companies like AIG may have also contracted themselves in to huge liabilities in their mortgage insurance policies (promises to cover the payments to lenders in the event of a default by the debtor). As court officers resolve the immense difference between actual cash and the unfunded promises of debtors like insurance companies, the value of actual cash tends to rocket, as in the case of the Japanese Yen in the last two decades.
Since it is the armed mercenaries of court systems that enforce the value of cash, all secondary paper contracts tend to collapse in value during a credit deflation like that of Japan since 1989. Secondary paper contracts like real estate titles and insurance contracts also derive their value from the activities of the court officials, and in courts the primary functional paper contracts are never “accounts receivable” but always actual cash available.
By the way, just as Jim Shepherd has extensive analysis available for free on the internet, so do I. However, analysis is not action. In fact, understanding is not required prior to taking relevant action. I know that many people have been exposed to my research and foresight but have not used it, perhaps because they have not understood it completely.
However, willingness to benefit may be much more adaptive than understanding. One person who understands can benefit many who may not
understand yet or ever. Benefiting and understanding are quite distinct.
How willing are you to benefit from whatever is changing? Jim Shepherd has been willing to benefit. What about us? Contact me if you are willing to be one of those who benefit most from whatever is changing. One way to contact me is by replying to this blog post.