Become a Member

written by reader Jim Rickards` Impact System

By markly, May 4, 2015

Is anyone familiar with this new pitch from Jim Rickards? He says it is a new way to make money that does not involve forex or stock trading!

This is a discussion topic or guest posting submitted by a Stock Gumshoe reader. The content has not been edited or reviewed by Stock Gumshoe, and any opinions expressed are those of the author alone.

guest

12345

This site uses Akismet to reduce spam. Learn how your comment data is processed.

248 Comments
Inline Feedbacks
View all comments
DBMD
Irregular
DBMD
June 12, 2015 3:09 am

Frank and Hendrixnuzzles I’ve read through the tread and enjoyed the thoughts, as I have tried to figure if inflation or deflation are on the rise. At times over the years cash has done quite well for me. I have timed some market events over the last 30 years well. But after good timing, I have messed up with bad investments. Real Estate, rentals, were some of my first investments. Recently agriculture has become a much greater component. This was based on the internal rate of return of rental versus agriculture. I am in Texas and the cattle business has become very good, and doing better than my rentals. In fact, I passed up a opportunity for wet land mitigation that would have paid my original purchase price for the future value of pasture land. Trees in the south have done well. I have some property in Colorado where the rental rates are unreal. The rate of return in Texas is not as good, so I am actually reducing my rentals there. For younger people I would recommend self directed IRAs for real estate. I grew up on a farm so agriculture is in my blood. It so happens that people like Rickards and Stansbury think it is a good idea. I can tell you that in 2007 some land properties dropped drastically while some parts of the country like Oklahoma went up. HN I have many of the same holdings as you except commodities. I also have an emphasis on cash right now. Changing assets at inflection points is key. Elliott Wave follows Stocks, Dollar, Euro, Bonds and Gold and Silver. They have an extreme view of cash holding now. They think real estate will go lower. I am too far into it to change now. They might be wrong. But I do like being able to eat my stock, cattle, and plant tomatoes. Avoid loosing assets, and move to out of favor assets that grow will work. It is hard to do though.

Add a Topic
717
Add a Topic
5400
Add a Topic
409
👍 1097
hendrixnuzzles
June 12, 2015 9:04 am
Reply to  DBMD

In agreement, as stated before I am overweight in real estate but since it is for income and unleveraged, I can accept a loss in nominal value.

As you indicated, real estate trends can go different directions in different locations.
I am in a part of the country benefitting from a big wave of economic and retirement refugees, so I think there is a good cushion with the demographic situation where I am.

As far as inflation/deflation…both are happening, stocks/bonds/real estate/debt being
pumped up by world central banks, while the underlying “real” economy is deflating.
No one knows how the situation will resolve itself. My feeling is that at some point
there will be a pretty chaotic “phase change”, with inflated paper making its way to
real assets, and real assets going up in nominal prices. Again no one knows for sure if or in what order this will occur. But I think eventually we will have the reverse of what we have now…that is, there will be inflation in the nominal prices of goods, and there will be deflation in the financial instruments currently supported by central bank policies.

What is really troubling is that there could be a whipsaw as well, deflation followed by hyperinflation, or the reverse; and the interconnectedness of the world markets make the disruptive potential wider and deeper than ever before.

Real estate and gold are unique commodities, and may behave in strange ways as things
play out. They could both drop tremendously in nominal valuation, or they could appreciate like crazy. There’s no way to know. But when the dust settles, they will have
value.

Add a Topic
409
Add a Topic
996
Add a Topic
409
👍 9968
arch1
June 16, 2015 1:21 am
Reply to  hendrixnuzzles

Machine ghost I do not like how Monsanto does business and will not invest in them for reasons I have posted several times but you make my point.Glyphosate (Roundup) is effective and is one of the safest Ag chemicals. It is rapidly destroyed by sunlight and moisture except for the percent that is absorbed and translocated to the roots ,where it blocks a substance that permits photo synthesis,,,thus starving the weed, Some plants,,,especially broad leaved..have always been “Roundup resistant”. I am not concerned about plants transferring DNA as that is something they have apparently always done.Farmers are not ignorant uninformed louts and they get their food at the store as most people do . I doubt if you can buy any food in the store that has not been GMO over thousands of years .to lessen natural toxicity,gain nutrition.improve disease resistance and etc. Zea Maise or Corn is probably one of the most modified plants in existance. Some plants , such as Rape have both toxic and non toxic versions to prevent cross pollination betwen the varieties. The edible Rape seed oil is called canola and industrial Rape oil is highly poisonous.
Despite being exposed to far heavier doses of Ag chemicals and eating the crops he grows Farmers are in general healthier and live longer than the general population,,,which is also living longer. One reason for that longevity is likely the higher vitamin content,yield and lessened native toxicity in GMO varieties leading to abundant and lower cost food that has averted many dire problems that consensus and all the models showed causing worldwide famine in the 1970’s. It is amazing that we have a problem of overnutrition ,caused in my view by unbalanced food intake,ie way too many carbs and sugars, and the general lessened activity that would burn off calories.
IMHO frank

Add a Topic
872
Add a Topic
359
Add a Topic
359
👍 7797
arch1
June 16, 2015 1:27 am
Reply to  arch1

Modification: I meant to say cross pollination between toxic and nontoxic varieties of Rape must be prevented by wide separations, eg several miles , between planting areas.

👍 7797
arch1
June 12, 2015 11:18 am
Reply to  DBMD

No more land is being made,is often said in advocating land as investment. My largest holding by far is in rural/residential land and have owned timberland, which may actually be a better investment once housing turns around. To retain wealth durable commodities have historically always been a wise investment and land gives the dividend of producing a crop of goods,,food, fiber, lumber etc. although the Wants of people often pays more than their Needs. IMHO

Add a Topic
282
Add a Topic
282
Add a Topic
282
👍 7797
hendrixnuzzles
June 13, 2015 11:19 pm
Reply to  arch1

I agree on the land, no more is being made. Which is more than you can say about currency or just about anything else. Another thing about real estate, there is always some movement in demographics… people are migrating, some areas are hot, some type of housing which is coming into favor. In terms of Stock Gumshoe, I always get interested in the REITS…but then I consider my out-of-market investments and feel I am exposed enough.

I also like the agricultural sector but have not made any major investments there, though I keep my eye on a few.

Add a Topic
282
Add a Topic
409
Add a Topic
5971
👍 9968
arch1
June 14, 2015 3:07 am
Reply to  hendrixnuzzles

HN The AG sector is currently out of favor but it will return,,,people must eat. You can always make some money in parts of the AG sector by watching the cycles of stocks like $POT $DBA etc. and buy at lows, hold and sell near historic highs. The Ethanol fiasco threw a distortion into the market by turning food into motor fuel and now people are upset by what the alarmists call Frankenfood. Monsanto is demonized for their Roundup ready corn. All plants in time develop resistance to weedicides and there is some evidence such resistance may be transferred across species. Monsanto just speeded up the process in the Lab. Apparently people equate resistance to thinking the plant contains the weedicide which is plain ignorance . IMHO

Add a Topic
179
Add a Topic
872
Add a Topic
872
👍 7797
MachineGhost
Member
MachineGhost
June 14, 2015 10:30 am
Reply to  arch1

It’s not ignorance on the side of alarmists. They’re concerned about the multi-generational side effects found in animals from eating GMO food. Is it such a stretch to imagine it may effect humans as well?

If you’re concerned about DNA transfer between plant species, you ought to be REALLY concerned about the DNA transfer from GMO food into the human gut microbiota. How do you even get rid of that once it occurs?

And you ought to look at what Monsanto actually does in terms of technology. It’s not even remotely close to being selective and/or cross-breeding; it’s artificial and forced mutations that could never naturally occur in nature. What are the unintended consequences? Monsanto doesn’t care.

Besides, Roundup — which is now a probable carcinogen — is ineffective. That’s what you get when you liberally spray “Roundup” on “Roundup Ready” crops after a few generations: around dozens of resistant weeds. F!ucking brilliant.

And that’s JUST “Roundup”. There’s a whole smorgasbord of other artificial creations waiting in the wings to be unleashed. It doesn’t take much common sense to be wary when making a profit is the agenda, not the public interest.

Add a Topic
872
Add a Topic
872
archives2001
archives2001
August 18, 2015 4:33 am
Reply to  arch1

‘Ghost’…You are SOOO SPOT ON with your warning about Monsanto!
You scare the bejeezez out of ME!
Have u thought about running for Prez?

Add a Topic
872
👍 94
hendrixnuzzles
June 14, 2015 1:11 pm

Hi Ghost, share your concerns on irreversible consequences that cannot be foreseen, especially since I know very little about the technology…the same concerns pop up with the new CRISP technology, which can be dispersed and distributed at very local levels at low prices.

👍 9968
LasVegasGypsy
Guest
LasVegasGypsy
June 15, 2015 3:54 pm

Folks: My thoughts on Rickards’ IMPACT…… I almost bought it but $1500 seemed quite high. What pushed me to skip it was the cost and two other reasons: (1) I got solicitations that Rickards was going to “give me a gift,” which turned out to be a (possibly) gilded ticket to a conference for 200 with him; and (2) and a daily bombardment of e-mails from (it seemed) everyone who works at Agora to join their IMPACT system. A couple of e-mails would have been sufficient (one of which was a reminder of the June 11 deadline). I probably would have “bit” except for the bombardment. Also, I thought it was more like me giving Rickards a gift, than vice-versa, since the cost of the conference was $6500! Wow!!! Furthermore, why couldn’t he give some real info about what the IMPACT system was about, rather than a long, long sales pitch. Sounded like snake oil! Also, why does he need to sell it for such a steep price if he is really trying to get the word out about the problems with our current system (as he says somewhere, maybe in “The Big Drop”). And, if he were really good at investing, why does he bother charging so much for advice and conferences? (I will say that he writes well, and convincingly, but Coyne just regurgitates the Rickards’ words from the Big Drop, without adding much of anything new, in his daily e-mails).
Someone who gave at least some reasonable info about their stock-picking system was John Shubert with his Alpha15 portfolio. Rickards and Coyne should take some lessons from Shubert.
BTW, I really have enjoyed the educational posts by MachineGhost and hendrixnuzzles. I hope I can someday learn as much as they seem to know about economics. Not sure why I’ve waited so long in life to try to learn but I think it was “QE-unending” that got my attention. Has anyone seen the Mike Maloney videos about the “Hidden Secrets of Money”? He sure makes a convincing case that our current monetary system (rather, I should say “fiat-currency” system) will collapse eventually.

Add a Topic
6137
Add a Topic
5150
Add a Topic
5150
Travis Johnson, Stock Gumshoe
June 15, 2015 4:50 pm
Reply to  LasVegasGypsy

Yes — though do keep in mind, that same case has been just about as convincing for most of the past 40 years. Bill Bonner at Agora has been predicting the collapse of the fiat US dollar since the late 1970s, and though he may be the father of doomsday marketing he’s not the only one — there’s an inescapable logic that the dollar should lose value over time, our federal finances are horrific and should have negative repercussions, and it’s pretty easy to build scenarios in which the decline of the dollar has a profound social impact, but predicting a timeline or urging people to make large specific bets on a particular outcome (or the timing thereof) is dangerous and has been almost always mistaken, through 44 years of fiat money and five US recessions, you’d still have had a hard time timing the market based on doomsday scenarios — and would have been left behind in many ways if you stepped out of society or out of the financial system in the 80s, 90s or 00s.

The “real” advice that a lot of the doomsday folks give is probably far more reasonable than their marketing — it is wise to be prepared for disasters, whether they are caused by financial or natural or human actions, it is wise not to get into too much debt when there’s a debt bubble, if you’re able to diversify your existence beyond a single physical place or a single source of food and water you might be better off, etc… but our world has never been as interconnected or as “just in time” as it is today, so predicting the ripples from any event, or the human reactions to those ripples, is the ultimate in hubris.

Be prepared. But don’t try to tell the future — especially if you start out being certain that something is unsustainable just because the logic that is dear and clear to you says it can’t be sustained. Is it logical that we have dozens of major religions who have (sometimes bitterly) different views about the nature, origin, and future of humanity, and that new people continue to join and commit meaningful time, money and soul to each of these religions, and have for centuries — even in the face of vast contradictions in their various scriptures and the professions of their leaders… and even when huge numbers of adherents don’t truly believe all of the things their faith supposedly holds to be literally true? I don’t think it is — but human societies have often believed things that seem profoundly irrational, and in my estimation have followed irrational paths, economically and otherwise, for very, very long periods of time.

I don’t think the world has yet created a brilliant big-picture thinker and futurist who is also a good short term (as in, less than a couple decades) stock picker. The smartest guys are often the last to realize that their certainties are built on a generation of ideas and assumptions and accepted theories that can never be as certain as our modern mind believes them to be — once you stack a few widely accepted theories of economics on top of some mathematical laws and some historical tendencies, you forge that underlying it all is human beings who are messy, mostly unpredictable, and probably fundamentally different then they were 50 years ago.

Probably currencies will continue to change. Was the “hard currency” of limestone disks used by the Yaps for 500 years profoundly better than the “fiat currency” that eventually replaced it? It was supplanted partly because of inflation (modern tools made it easier to quarry the disks, so they made more of them), but it was supplanted for something based on gold, and then by something based on trust. And the society kept going, kept doing what they did to produce things that were exchanged for other things using whatever the convenient medium of exchange was at the time… did society break down at some point because of the crash in the value of the giant stone disk? I have no idea, but there are still people on Yap, and I reckon their status as a playing card in World War II probably had a far more profound impact on their culture and society than did the evolution of their currency.

Sorry, I tend to ramble on these topics — probably because there isn’t really a good answer, and the teases and promotions that spell out predictable doom, by a date certain, get on my nerves.

Add a Topic
4389
Add a Topic
6137
Add a Topic
540
👍 21718
arch1
June 15, 2015 8:04 pm

Travis Excellent analysis and I agree on all points.I have heard since youth that if you predict a hard winter long enough you will certainly be right eventually (depending on your definition of hard winter). In the end game all trade relies on trust. IMHO frank

👍 7797
hendrixnuzzles
June 15, 2015 10:32 pm
Reply to  arch1

First Currency Wars…now, Newsletter Wars !

Travis –Love your balanced outlook. It is very noteworthy that some of the prominent
commentators have been “sounding the alarm” for many years. One of them is
Ron Paul, who was in Congress for 12 terms.

We now have “Newsletter Wars” with Ron Paul and Doug Casey at Stansbury and Rickards at Agora.

I am personally in the Casey/Rickards/Paul camp on the macro level, but am confounded at what the proper response is on a personal investment level. One’s analysis of the current situation can be accurate, but the recommendations made can be ineffective or mistaken.

Rickards I find very persuasive in describing the current situation, but he is not at doctrinaire about what will happen. He admits that the outcomes are unpredictable, and that there are many possible specific outcomes with different variations.

Besides a clear-eyed view of the current situation, which again may or may not lead to good investment ideas, Rickards gives some very good analysis of the main theories (and their faults) that have come to be the underpinning of modern policies. In Currency Wars,
he also gives many interesting leads to authors and subjects that I would like to read about.

Add a Topic
2756
Add a Topic
753
Add a Topic
6137
👍 9968
MachineGhost
Member
MachineGhost
June 16, 2015 10:04 am
Reply to  hendrixnuzzles

The proper response is not to forcecast and not to listen to doom porners. And adopt an agnostic portfolio, i.e. the Permanent Portfolio which is 25% each of cash, T-Bonds, stocks and gold. And then get on with your life.

Add a Topic
210
MachineGhost
Member
MachineGhost
June 18, 2015 1:26 pm
Reply to  hendrixnuzzles

hendrixnuzzles, I think you’ll find this paper very interesting in accordance with our recent debate: http://www.voxeu.org/article/banks-are-not-loanable-funds-intermediaries-macroeconomic-implications

Still getting through The Death of Money…

archives2001
archives2001
August 18, 2015 4:39 am

Thanx T, sound sage advice as usual!

👍 94
hendrixnuzzles
June 18, 2015 2:08 pm

Hi Machine Ghost,
These analysts are illustrative of the ivory tower thinking that got us into this mess.
They think it’s completely OK that banks create money out of thin air, in fact they posit that that is the primary reason for the existence of the banks. No surprise, since the scraggly-haired guy works for the IMF. These guys are wandering around in the central bank wonderland, don’t seem to understand the difference between money and wealth, and seem to think everything is OK.

Your idea of an agnostic portfolio is perfectly valid, but as I said before it is not for me.
Putting my preferences aside, I have a few remarks about it.

1. It is interesting that your gold allocation is much higher than mine, and in fact it is higher than most of the hard-money advocates I have seen. Even Rickards thinks 10% is OK.

2. Even if one likes your agnostic allocation in theory, and I grant it has a lot to recommend it, I think we are at a point where one’s entry point really counts for a lot. I would not be very comfortable entering into T-bonds and stocks at current levels, would you ?

3. To maintain your “agnostic position”, at some point you must rebalance. How do you decide when to do this ? Yearly, quarterly, or when the assets allocations get out of whack by more than X % ?

4. As you believe in some allocation to stocks (25%), do you buy index funds, etfs and mutuals, thereby keeping an agnostic position, or do you pick stocks and sectors ?

Best regards

Add a Topic
210
👍 9968
MachineGhost
Member
MachineGhost
June 18, 2015 3:25 pm
Reply to  hendrixnuzzles

2a. And because I don’t really have any public equity to “protect”, I’ve lowered the T-Bond duration in my main portfolio from the normal 16-17yrs to about 2-3yrs due to the current risk. In my smaller equity market cap neutral portfolio, it is full on 16-17. I also use trend following on stocks, bonds and gold to decide when to buy to juice it up a bit more.

Add a Topic
718
Add a Topic
210
MachineGhost
Member
MachineGhost
June 18, 2015 3:20 pm

1. Yeah, pretty funny huh? But the key is the gold is equally balanced off with other the assets, rather than it being a doom porn bet. Almost all people really do have a hard time with 25% gold and come up with infinite rationalizations to adopt a lower percentage at their own peril to the portfolio working. It may be due to a bit of intuition and gut feel though, because 25% gold isn’t quite risk matched with the other 25%’s, but the difference is only off about 5%. It depends on if you value simplicity over exactness.

2. Since the four assets work as a complete portfolio together, timing does not matter if you always perceive it from that perspective. There are no negative real returns in any 3-year period historically. The single biggest risk is a “tight money” environment such as 1969, 1981, 1994, 2013 when the Fed raised rates or wound down QEternity, but typically all assets go down when cash is getting more valuable in real terms (gold is the most vulnerable). Personally, I have no direct public equity exposure in the portfolio due to the chronic overvaluation, but may reconsider that stance after 2015.75 to capture the expected flight to safety into U.S. stocks as the sovereign debt crisis speeds up.

3. Rebalancing bands are when any asset reaches 15% or 35% which averages about once every 2-3 years. Annually rebalancing is equivalent to about 20%/30% rebalancing bands. I can’t remember for sure, but I think 15%/35% is more risk-reward efficient than 20%/30%. It allows for a bit more momentum.

4. It’s best to keep expenses low, so the broad total market ETF index funds are the best way to be agnostic. Personally I take that agnosticism a step further and also equalize the market cap risk (slowly working on sector too but it may not be practical yet) as well as the four assets themselves. Unfortunately, we don’t really have a full cycle bull-bear in the T-Bond history back to when gold went free market (1968), so there’s a good chance the risk parity allocation (35%) for T-Bonds will be overestimated going forward. It’s something I’m still working on as time permits.

Add a Topic
210
Add a Topic
210
Add a Topic
210
hendrixnuzzles
June 18, 2015 4:08 pm
Reply to  MachineGhost

Hi Ghost…you said that you don’t have any equity exposure, what are you doing with the 25% that should be in stocks ?

👍 9968
MachineGhost
Member
MachineGhost
June 18, 2015 4:23 pm

I have the allocation in private and alternative investments that benefit from Prosperity.

hendrixnuzzles
June 19, 2015 8:12 pm
Reply to  MachineGhost

Hope it comes back someday. Best regards

👍 9968
highlands
July 4, 2015 3:18 pm

Interesting thread.

👍 11
highlands
July 4, 2015 3:24 pm

Just got the book…

👍 11
hendrixnuzzles
July 6, 2015 11:55 pm
Reply to  highlands

Hi Doug, if you like reading non-fiction, I can suggest these titles which I recommended previously on a different thread:

When Money Dies by Adam Ferguson
The Downfall of Money by Frederick Taylor
These two are about the economic, social, political and financial histories of Germany from WW1 through 1930. Lots of details about what happened, and what people do when the money goes bad. Fergusons book has a lot about Austria and Hungary, which suffered hyperinflation before Germany. Both books are very good.

The Big Reset by Willem Middelkoop…Central Banking 101, basic macro financial,
and wonderful historic survey of the failures of fiat inflation and currency failures worldwide. Plain talk, nothing doctrinaire, no panic mongering. Still, alarming enough
without trying. Written by a Dutch guy with no visible ax to grind or newsletter to sell.

Liberty or Equality by Leddihn-Kuenelt…over 60 years old but still timely.

The Quants by Scott Patterson…math whizzes create Wall Street meltdown and make billions of dollars.

A very good thing about these books is that the authors will not bombard you with emails to subscribe to their stock tips and newsletters.

P.S. I spend most of my time on other threads: Dr Kss’ biotech thread, Myron Martin’s thread, and the Clubhouse thread. Hope to hear from you, would love to hear your thoughts.

Add a Topic
717
Add a Topic
5971
Add a Topic
3932
👍 9968
Old Salt
Guest
Old Salt
August 2, 2015 8:42 pm

Jake–You took the plunge with James Rickards’ IMPACT system and have a good understanding of what it is and how it functions. After three months experience is this an appropriate time to update your post of May 5 and report results? I and many other posters are eager to learn whether Jim R. is onto something or not.

Add a Topic
5148
Add a Topic
5150
fossten
Member
fossten
August 20, 2015 6:27 pm

I bought IMPACT in June. All but one of his picks have been positive gains. One of the most recent options he suggested, I purchased two weeks ago and I just sold it for 100% gain. In two weeks. I put all that into his most recent pick from two days ago and it’s shooting through the roof. He does seem to know what he’s doing. I’m up 30% overall in two months.

Add a Topic
570
👍 7
cbdb
Member
cbdb
October 24, 2015 12:59 pm
Reply to  fossten

David, I am curious if you happen to still have positive overall gains- now two months later.

Jaka Mele
November 18, 2015 3:26 pm
Reply to  fossten

So, almost 3 months later… Could you be so kind, and give us an update on IMPACT performance for you?

👍 5
hendrixnuzzles
August 23, 2015 6:39 pm

RICKARDS…Currency Wars update…Say, whether you like Rickards or not, whether you subscribe to his pricey stuff or not, one has to admit that his conceptual framework
for currency wars helps us interpret what is going on recently in China, and the international repercussions in our markets.

Despite the efforts of the G7 and now Beijing as well to generate growth and inflation with fiat money, low interest, financial stimulus, and debt, we are seeing deflation everywhere except in stocks, bonds, education, medical services, and real estate. And stocks may be cracking.

Have you noticed the depressed prices for oil, coal, uranium, iron ore, agricultural commodities, copper, and natural gas ? How many solicitations do you get from credit card companies, and mortgage lenders ? See the zero interest financing on furniture and cars on TV ? Seen the calls for increases in the minimum wage ? How about the Wall Street Journal article on student loan defaults ?

Deflation and depression meet governments trying to avoid them. Stay tuned.

Add a Topic
108
Add a Topic
717
Add a Topic
5400
👍 9968
MachineGhost
Member
MachineGhost
August 26, 2015 11:36 am

And Rickard did not predict this Yaun devaluation at all. That’s the nail in the coffin for him.

hendrixnuzzles
August 30, 2015 1:50 pm
Reply to  MachineGhost

What do you mean ? The yuan devaluation fits perfectly into his theme. The cover of the book has the yuan and the dollar as soldiers battling each other.

Rickards is not the only one who did not predict the yuan devaluation. Be reasonable,
to call this a nail in [his] coffin just shows your predisposition to discount his ideas.

The yuan devaluation is a confirmation of Rickards main thesis !

👍 9968
MachineGhost
Member
MachineGhost
August 30, 2015 2:21 pm

True, Rickards is just another contender in the latest line of [failed] forecasting gooroos that stretch back decades. I can’t help but feel like Toto pulling back the curtain. But I did mean as far as his trading acumen was concerned, not his ideological doom porn.

The yuan devaluation is really a non-event considering how much the dollar has appreciated vs the other Asian currencies. The yuan is now horribly uncompetitive. China will need more than a fee wee bit percentage of yuan devaluation to remain export competitive. That cat may be out of the bag already anyway as wages have gone from around $.85 to almost $5 an hour; Vietnam and the American South is where the action is now.

Add a Topic
108
Add a Topic
637
hendrixnuzzles
August 30, 2015 8:23 pm

Whether you like his investment recommendations or not, Rickards has recognized and explained what appears to be a very good conceptual framework for what is happening right now.

The guy publishes a book with the yuan and the dollar as cartoon soldiers fighting each other…and you want to say the yuan devaluation is a nail in his coffin !

👍 9968
hendrixnuzzles
September 16, 2015 6:21 pm

Newsflash. Chinese holdings of US dollar securities drops by record 30 billion in ONE MONTH. Belgian holdings, considered to be covert Chinese money, drop 52 billion
in ONE MONTH. That’s 82 billion of US dollars, sold out of Chinese holdings, in ONE MONTH.

👍 9968
hendrixnuzzles
September 24, 2015 3:57 pm

After cashing in 80 billion or so in US dollars last month, here is what the Chinese are doing with their greenbacks:

http://seekingalpha.com/news/2795916-russian-gas-project-gets-boost-from-chinese-funding-total-ceo-says?uprof=46&dr=1#email_link

Months ago I stated that if I were in charge of Cjinese policies I would use USD to buy real assets. Also that the Chinese would find a fit in the Russian need for foreign currency in the face of US sanctions. Voila.

👍 9968
Hugh Moore
Guest
Hugh Moore
October 24, 2015 11:49 pm

Great thread and thank you all (in particular, HN, MT and TJ) for your insightful comments. To summarize for the impatient: Rickards’s book identifies our malaise in the new millenium with an uncertain outlook in particular for traditional mainstays of personal wealth ie the USD itself, government bonds and equities. Criticism of his book is that it is just a well-researched doom-dealer published to sell an expensive newsletter and “exclusive club” which touts recommendations on currency and option plays which have had mixed reviews (from loss making to + 30% in a few months). However, most readers don’t care if Rickards is right or not, they just want to know what they should be doing to ensure their own personal future wealth. So what is the take away from this thread? Firstly, the USD will most likely lose its status in our life time as the only reference currency for the pricing of global commodities. This will happen as a natural trend ( the US only represents less than 5% of the world’s population, whose relative personal wealth is slowly decreasing). This will undoubtedly cause it to lose value relative to other currencies, since other nations will no longer be forced to deal in dollars. However, the timing is uncertain and the USD could gain in value for many years before ultimately losing it. Secondly, low interest rates have kept both bond prices and equity prices artificially high. This means that as soon as interest rates rise it is reasonable to expect downward pressure on the prices of financial securities. Thirdly, the relentless ever faster march of technology is making a challenge to find high value jobs to replace the ones being lost to machines – in particular those jobs regarded as typical male white collar ones – leading to greater polarization of wealth ( significantly richer minority causing the mean wealth (pun intended?) to be a lot lower than the median) Fourthly, shifting demographics continue (more old people, low birthrate for educated, immigration needs to increase to keep real estate values steady) with the search for wealth trend as in “go west young man!” reaching its logical conclusion and going so far west that it ends up in the east! Fifthly the fundamental mainstay of capitalism – the banking system- is being brought into question in terms of the deposit multiples used in lending and the off balance sheet transactions and potential liabilities that dwarf the cash on hand. My solution to this: expect change (lots of it!), uncertainty and volatility, Realize that world wealth is a zero sum game. Currency is a means of exchange so that if one currency loses another will gain – so have some holdings in currencies other than the one you earn your income in. Be diversified in your income streams as much as you can but not so diversified that you lose your ability to manage. If you have debts, make sure that your income streams match the currency and sector of the servicing of those liabilities. Manage your assets actively – ie have stop losses in place for all your financially traded assets. Stock pick aggressively – realize that in this environment the winner takes it all. Expect interference from the state: governments are going to find it increasingly difficult to manage the increasing demands of the disenfranchised masses with their own dwindling resources and they are going to dream up ever more resourceful ways of extracting wealth from those have it ( they have already completed the first step of this exercise by killing financial privacy) In conclusion I would not be surprised if in the next 20 years we will see a challenge to capitalism as the main ideology. This may not be such a bad thing as we might think (the first step in this direction is the availability of “free” things on the web – entertainment, educational, artistic, literary and musical products which would have cost significant sums only a decade ago) but I will guarantee you that we are in for quite a change in the years ahead!

Add a Topic
718
Add a Topic
5242
Add a Topic
409
Joseph Fletcher
Joseph Fletcher
November 6, 2015 12:06 am

Harry Dent is seldom right. Don’t believe me – look at his track record. My wife lost about 200k on one of his recommendations. He had been predicting his doomsday scenario for at lest the past 5 years. He’s almost like a broken clock – right twice.

Add a Topic
3368
John Law
Member
John Law
November 26, 2015 9:19 am

I am a subscriber to this shit. Well, the money spent on this thing is money well lost, I can tell you that. I haven’t trade the recommendations yet, and I am glad that I did not.

It’s all about buying options on CFDs (I am fine with that) and occasionally buying a stock, or a stock option.

Although I like to hear Jim Rickard’s take on currency issues most of the time – for sure there is absolutely NO way to trade them profitably. And the “advisor” who gives the actual recommendations (for some reason Rickards doesn’t do) …. proves that point BIG TIME.

Let the results speak for themselves, here is a current screen dump 11/25 for the entire portfolio (open and closed positions). As I wish to be decent person, I have pixelated the actual open positions, but left the % return in place.

http://postimg.org/image/zdegxu5pp/

Do the math. How quickly your account would deminish (even if you’d only be putting like a small portion in each position)…… In total: 9 wins , 19 losses. And those being BIG TIME losses by nature….

At your service.

Add a Topic
570
Add a Topic
5971
Add a Topic
5971
👍 17
Norm Winn
Member
Norm Winn
December 12, 2015 11:07 am

Somewhere in the list of comments was a question that if the investment strategies/systems proffered in various newsletters actually worked, why would the author “share”? They make their money selling subscriptions to their newsletter. You’ve heard the old adage that if you can’t do, teach (no offense to actual educators, my mom was a career teacher).

We use cookies on this site to enhance your user experience. By clicking any link on this page you are giving your consent for us to set cookies.

More Info  
34
0
Would love your thoughts, please comment.x
()
x