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Ask the Adviser: Bob Fitzwilson

Your investing questions answered
Saturday, August 18, 2012, 12:15 AM

This week, we're trying something new in our regular podcast series. Chris talks with Bob Fitzwilson, founder of one of the financial advisory firms that we endorse.

Last week we invited Peak Prosperity readers to submit their top questions about money and investing. You didn't disappoint.

In the podcast below, Chris puts your questions to Bob. We think you'll be pleased with the results.

We addressed as many questions as we could in this first conversation. Most of the reader submissions regarded general investing strategy, retirement accounts, precious metals, and/or market risk -- so we focused primarily on those topics.

If you value this sort of Q&A with an experienced advisor whose investing outlook is aligned with the Crash Course framework, let us know in the Comments section below. If the response is positive enough, we'll turn this into a regular segment (likely a once-per-quarter event). And we'll involve our other advisors, as well.

And if after listening to the podcast, you find yourself interested in connecting with Bob and his team to learn more about their advisory services, please use the form here to do so.

Transparency note:  As a result of our public endorsement of Bob's firm, Peak Prosperity has a commercial relationship with them. The details of this relationship are clearly presented in writing during the referral process -- but the punchline is, our relationship does NOT result in any increased fees to those who become clients.

cheers,
Adam

It should go without saying: this discussion should not be construed as individual financial advice by those listening to it. The content should be taken as informational and educational in nature only. Investment advice must be tailored to your specific personal situation (which Chris and Bob are obviously unaware of) and should be obtained directly from a financial advisor you trust. Before acting on any of the statements made in this podcast, we advise you do just that.

Click the play button below to listen to Chris' interview with Bob Fitzwilson (46m:30s):

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Transcript: 

Chris Martenson: Welcome to another Peak Prosperity podcast. I am your host, Chris Martenson. Today we are piloting a new segment in our regular podcast series.

As most of our readers and listeners are aware, Adam and I have worked hard to identify a few independent advisory firms that see the world through a similar lens as we do. We did this to have a useful, well-vetted solution to the many requests we get each month from people seeking referral to financial advisors who “get it.” It was not an easy task, nor one that we took lightly, believe me. But now that we have endorsed these advisors, we thought it would be a very helpful exercise to bring them on the program from time to time to ask them to address the money-related questions our readers care about the most. So today we are doing just that.

Over the past week, we asked you to submit your pressing questions about money and investing. You did not disappoint. We are going to be speaking with each of our endorsed firms. Today I am pleased to be speaking with Bob Fitzwilson, founder and lead partner of The Portola Group, which is the West-Coast-based investment, management, and financial advisory firm we endorse. Bob has been advising clients since the 70s and has a wealth of perspective to share. It is really deep.

Before we get started, I will make it clear that Peak Prosperity has a commercial relationship with The Portola Group, one in which fees are shared on referred accounts. It is important to note that this arrangement does not result in any increased fees charged to the end customer. You are charged the same as if you had walked in through the front door. All the details on this arrangement are provided clearly in writing during the referral process. Now that we have got that out of the way, Bob are you ready to get started?

Bob Fitzwilson: I am.

Chris Martenson: Excellent. Why don’t you tell us about your experience, and, if you would, your investing philosophy?

Bob Fitzwilson: Portola was started in an interesting period. I personally started in the business in 1973, which frankly was a good time to start, because it was so tumultuous and a great chance to learn in tough times. The Portola Group was started in 1979, which was equally tumultuous, but it has been focused primarily on individuals and families with what I call “wealth management.” Philosophically, we believe on the investment side that wealth is created by identifying very powerful long-term themes, trying to hang on, and not by trading things like baseball cards. It was much less prevalent in the 1970s, and frankly throughout much of my career, but now it just seems like everybody is day-trading. You have high-frequency trading, which is frustrating a lot of people.

The basics of investing really have not changed. All the great wealth has been created through some form of equity, although fixed income can be appropriate at various times, and then trying to hang on as long as you can. During the 1990s, most of the returns that we achieved were things that just kept getting bigger and bigger. We would have a discussion about taxes and hopefully selling things like Microsoft and Cisco. So it was not necessarily a great incremental analysis. It was just a fabulous theme that just kept growing.

Chris Martenson: Right. So let just fast-forward to today. You have obviously been in business for a while now. Has anything in the landscape around risk and how you really think about risk changed, given everything that has been in the news lately, and certainly with some of the more famous blowups that we have had at some of the key institutions out there? Trust has sort of been hit a little bit. The landscape has changed a little bit. Maybe there is this thing called Peak Oil. There are a lot of sort of large-moving pieces. How has your perception of risk shifted over the years?

Bob Fitzwilson: It changed dramatically in 2008. I tell people I have learned more in the last three years than I did in the first 37 years. A lot of it is through you and your research. What we took for granted, like the rule of law, police, courts, and honesty from institutions may have left a long time ago, but it all became apparent early in 2009. What we did was we hit the books. I have probably gone back through 2,600 years of history studying all these cycles and trying to figure out what was going on. What I discovered is that where we are right now was actually quite the norm, not the exception. The last 30 years were historically an aberration. It is really devolving, unfortunately, into an environment of every man and woman being on their own.

That includes individuals, companies, and governments. I have been writing about the massive increase in the printing of money. There was a book called The Great Wave that turned me on to price waves that have hit that since the 1300s. Those are based on the sudden change in the population, but your work on the ceiling and on the resources has provided a third leg in our thinking. So it is an extraordinarily risky environment unless you make the mental switch, acknowledge it, and then restructure your life and portfolios accordingly. If you do that, I actually think it is one of the best money-making opportunities and healthiest changes that I have seen in a long time.

Chris Martenson: Well, let us talk about investing, then, in this environment. I agree with two main points. One, there are extraordinary opportunities here. The second is that this is no place for dabblers. When I manage my own money, it is a full-time sport for me or I need somebody else really looking at it. Halfway in-between does not really work. That includes handing money off to somebody in some firm, never tracking it, and never seeing what happens. I think this is a time to be a little bit engaged – if not a lot engaged – in one way or another, or to have a lot of faith in who you are working with. Let us get to investing then. So we talked about this question before we started recording here. It is an interesting one because it has a distinction in it. What are the most undesirable/despised assets today is the question. Might they be undervalued as a result? What is your response there?

Bob Fitzwilson: First of all, as I mentioned, in my business those are mutually exclusive items. What you look for is a despised asset, whether it is an individual company or a category, because perceived risk is always highest when things are low but actual risk is low. When things are high, the risk seems very low but it is actually high. So that is one of the few activities in life that when things get really cheap, people want less and less of it. So one thing you can do is something that comes under a banner of investing called the “rubber band theory.” When things get stretched too far one way, they tend to bounce back the other way. For people who truly want to outperform, the rubber band concept is one of the few ways that I know of to do it. You wait until things are crushed.  For example, early 2009 was not pleasant for anybody investing in that period, but it gave you a chance to pick from all the broken stocks, find the best themes, rebuild your portfolio, and get it back.

On the theme thing, the studies have shown through my career that 90% of the returns come from your allocation. The other 10% we divide into two. One is common sense. The other is the genius factor. The first part, the common sense, is called theme-based investing. I have been through virtually every kind of cycle you can imagine. There are always a few dominant themes. You try to identify them. They are mostly common sense. In this cycle, as you pointed out and as others have, too, energy is a very powerful theme. Food, water, technology, precious metals, and resources in general are themes. So there is a whole set of very powerful long-term themes that people can look at. Even if there was a genius, because there are so many players and so many computers, trading is a loser’s game. You just want to identify the really good themes and companies and then try and hang on.

I actually think this is the best investment environment in my career because of the large pools of money. Most of the money is contained in the hedge funds and in a few of them. A lot of them are doing this high-frequency trading with computers. So if you look at most activity on any given day, it is generally the same stocks. The reason is that they have too much money and are playing this game of my computer is smarter than your computer. The vast majority of securities are basically an open field. Nobody is paying any attention to them. So instead of trying to become a day trader and have a better computer, go old-fashioned. Look at the company. What do they do? What do they make? Why would people want a lot of that? Then just try to hang on.

Chris Martenson: Excellent. So you mentioned at the beginning that allocation, of course, has been a powerful determinant at any moment in history. Today is certainly no exception. If I walked in through your door or called you up and wanted to discuss your approach to portfolio allocation, how would you get me started on that conversation?

Bob Fitzwilson: Actually, I would start you in a direction you probably did not imagine. Our roots are in planning. I was one of the pioneers of putting financial software on microcomputers. I hate to say it, but it was 32 years ago. The first thing I created was a what-if program on tax planning, but the second thing that was probably the most important was an integrated model of a person in our family’s entire financial picture, both now and in the future. So a portfolio strategy and allocation really should be crafted in the short term, paying attention to macroeconomic events, news, and all that stuff. But ultimately, the output of that strategy is to fund a lifestyle that you or your family want.

The first thing we would do using the software is this – it is hard to do it by hand because there are so many variables. Variables would be your life expectancy, the age when you want to retire, if you want to give money to charity or to your children, and if you spend too much or too little money. What our software does is figure out what that number is that it takes to get you everything you ever wanted. So the baseline investment target that we have used since we founded the company is 3% after tax and inflation. We arrived at that because in the late 1970s, inflation was, I think, 12% to 14% taxes. In California, the marginal bracket for the state and federal was 73%. If you were getting 14% in a money market fund, you were probably losing close to 10% in real terms. So we wanted to figure out what a realistic life expectancy of rate return would be. That is, after taxes and inflation.

So at the time, the Gross National Product in the U.S. was growing at about 2.5%. So we rounded it up to 3% and said, “That is a good proxy for after tax and inflation returns. 5% is a little more aggressive.” For a holistic idea and what matters to the person and their family, we start with that 3% after tax and inflation return. We take into account all of the other things and characteristics of their life and then try to craft an allocation that gets them where they want to go. It is interesting.

When I think back now about the 2.5% GDP, I know, Chris, you have done work showing these exponential curves on debt. It all sort of took off in a big way just right before I started my career in The Portola Group. It is interesting that Friedman argued that it just increased the money supply by I think 3%, which is somewhat equivalent to population growth. It is interesting that the GDP had been growing at that level until they turned the money printing spigots on. Then things took off, but we still think that 3% after tax and inflation target for planning purposes is a good place to start. Then when it comes to actually investing money, subject to not taking too much risk you, of course, you want to get as much as you can in the cycle because you sometimes get it back in another portion of the cycle.

Chris Martenson: Great. I have a question here that reads, What is the most important advice you have to offer investors in each of the three key age groups? That is the young, mid-life, and elderly. For the young, let us call that people in their 20s and 30s.

Bob Fitzwilson: I go back to investing in yourself. Obviously I am not in my 20s or 30s, but what I try to do on a regular basis is just say, What do I have that I am counting on? What would I do if I did not have it? Just in my adult life, we have gotten away from being able to do things. So for a young person I would say invest in yourself first and foremost. Try to figure out how to do things. If you believe that we are coming up on this 20-year cliff and even the fiscal cliff, what are the skills you have that other people would pay you for?

Take care of not just your money and the necessities of life, but if you have money left over, maybe some silver coins or something like that, I would probably pick the most powerful theme I could think of. That is energy. The beauty of it is, a lot of these energy companies are just ridiculously cheap, and technology too. The irony of living in Silicon Valley is that technology used to be the wild and crazy format for investing but you have things like Cisco’s announcement yesterday of increasing the dividend by 75%. I think you are going to see a lot more of that because they just cannot deploy that cash. They are almost becoming the dividend plays of the current cycle.

Chris Martenson: Right. They have become the AT&T of today, in essence. All right. So for mid-life, the 40s and 50s, what is the advice for that crowd?

Bob Fitzwilson: Stay employed. Generate as much income as you can possibly generate. Do not even think about retirement. Frankly, the most miserable people I know oftentimes are those that are retired. You want to stay active, stay employed, and earn as much income as you can. You want to go to a zero-based view of life. What do I have? What can I do to provide for myself? Assume that you are going to get no help from things like Social Security and Medicare.

The other thing is get healthy. I tell people, Do not argue about who is going to pay for your hip replacement. Go out and get healthy so that you do not need one.

Chris Martenson: Great advice.

Bob Fitzwilson: Get your expense rate down. There is the long-term cliff that you and I have talked about, but we are coming up to a moment in history that I personally cannot think of anything similar to except from a couple of thousand years ago. It is going to get resolved, but what we have found is that while we all thought we were all on parallel paths, what we are coming up to is the common end point. It is going to be problematic. There just is not enough money to fund all the things that have been promised. So historically these promises have either been inflated away or they have just been reneged upon. There are a lot of questions about the retirement assets. Can governments do this or that? I think my answer is that governments are also in the category of every man or woman for themselves. So they can and do whatever they feel they need to do.

So for putting money into a retirement plan, in the early 1980s they said we did not have enough savings. So they created these plans. We had the Social Security Commission, the Blue Ribbon Committee, and all these great people. We ignored pretty much every one of their recommendations. We went from, say, a 73% marginal bracket in California down to a low 30% marginal bracket. So it was about saving money at a high tax rate, having it grow tax-deferred, and then ideally taking it out at that lower rate. We have the opposite situation now. It is almost anathema to say, Do not put money into these retirement accounts. But you are basically saving taxes at a low rate, putting it into what will inevitably become a high rate, and you run the risk that something untoward happens from the government to your money.

Chris Martenson: I want to dive a little more deeply into retirement accounts in just a second. For the third category and people in their 60s, 70s and 80s, what is the advice you have there?

Bob Fitzwilson: I would say if you are in your 60s and maybe even your 70s, the advice is the same for in your 40s. If you have a skill and can get paid for it, keep doing that and cut back to the bone on spending. The time frames for resolution on this stuff are probably pretty short. I am not sure if you are in your 80s that it is a whole lot different. The other thing is, whether you are young or old, plan your portfolio for a human life expectancy.

I think people are trying to figure all this stuff out. It is impossible to figure it out. I think we know how we got here and who is saying what to whom. It is really a chaotic system. The end of it has been seen many times in history, but the timing of it and the specifics are unknown.

It is interesting to handicap what is going on but always keep coming back to you and your family and what you need. If you need $500,000 or $300,000 to meet your goals, do you really want to be a day trader and bet on what the Bundesbank is going to do to get double or triple that and run the risk of losing what you have got?

Chris Martenson: Interesting. While we are there, you mentioned Bundesbank. Are there any special considerations you would augment any of this advice with for our international listeners?

Bob Fitzwilson: Most of what I said, I think, is true. There have been some specifics about taxes in the U.S., but this is a very often-seen and scary moment in history. Like I said, I have gone back 2,600 years. It is as regular as it can be in every culture, every country, and every timeframe. They have all done this. In the end you have collapses of paper money. Things go back into real assets. I also think, and your work supports this, that we are seeing the end of this 200-year virtuous cycle. Things are going to head back in that direction.

How far they head back in that direction is a function of some kind of a catastrophic conclusion where adults take over again, work hard, compromise, and work our way out of this stuff. It is not wise to avoid preparing for the possibility of the catastrophic outcome. That means sustainability, do personal preparation, have some gold and silver, have solar energy, learn how to grow food, plant fruit trees, and all those sorts of things. That is common to everybody on the planet.

Chris Martenson: Obviously, local mileage might vary. Brazil might have a better run at it than Japan, for instance, but this is a global phenomenon. The thing that a little bit different this time is there is no border that you can easily duck across. So, if in 1922 you did not like what Germany was doing with their printing press, there were four borders to go across. It is much more difficult to duck these days. Certainly, with what is going on in Europe, that is becoming real apparent over there too.

I want to get back to retirement accounts because there a lot of interest there. The next question is –

Bob Fitzwilson: Before we do that, just one quick comment on what you said.

Chris Martenson: Sure.

Bob Fitzwilson: The one thing we cannot duck is what you have highlighted. All this other stuff is human stuff about who is going to pay for what, when I should retire, and what my money is worth. You cannot duck the energy problem. So we are going to have to come together in the next 20 years. Prices are going to have to rise. That is out of our control, given the technology that we have now. Maybe that will change, but given what we know now, that is like the elephant in the room that no one wants to talk about.

Chris Martenson: Right. Our perceptions do get shaped by recent experience. I believe it was in 1998 that the percent of disposable income in the U.S. that was applied to food and fuel hit an all-time historic low, ever in history, of about 14%. It has been climbing up a little since then, but the long-term historical average, and other places in the world will confirm this, is around 50%.

Bob Fitzwilson: Wow.

Chris Martenson: If you just think about how we get back to that, do we do it in fits and starts, gradually and slowly, or all at once in some event in the Middle East? One way or the other, it happens, probably. So if you believe in that rubber band going back to its normal place, that is everything that you have advised so far, which are all things I fully believe in. If we can become more resilient to food and energy at this stage in our life through gardening effort and investments we can make in our house so that we can spend less cash in the future on those things, those are obviously great steps towards resilience, higher quality of life, and maybe a healthier life.

Bob Fitzwilson: I agree.

Chris Martenson: All of that is possible. I love having this conversation. So for retirement accounts, here is the question:  How safe are retirement accounts, really? You mentioned that there is a risk here potentially that we do not know what the government is going to do in the future. Maybe it will be increased taxes, withdrawal at some point, or forced investment in government securities during a national emergency. Maybe there will be the confiscation of them as we saw at that one point in time. In Ireland, I believe they proposed a very small tax and passed a one-time .8% tax on pension assets at that point in time. Are these things that are on your radar screen? How would you respond to the question of how safe are retirement account assets?

Bob Fitzwilson: Everything is possible. Everything you have outlined has occurred. I think Argentina has done this twice in the last 10 or 12 years. I think one healthy way to look at it though is this – I am probably not going to get many healthy fans for this – Remember that the retirement account in the U.S. is this way: Think of Uncle Sam as your silent partner. So the deal was that you could defer your taxes and compound tax-deferred, but in the end when you took it out, Uncle Sam wanted his cut back. Governments need money. They are looking at that multi-trillion dollar pool of assets and saying, I want to cash out my one-third or whatever it is that I am due. So there is that risk.

One of the biggest risks is the rise in rates. Now you are going to compound tax-deferred; let us say you are a genius at investing, but if rates double, then you pretty much gave up everything you made. So I think people really have to take a hard look at whether they put money in there. It is probably better to pay the lower tax for the sustainability things we talked about or the investment things we talked about. Then sometime between now and the year-end, in the U.S. in particular, they have to make a really ugly decision about whether to keep money in there at all.

Chris Martenson: Right. Let us talk about that, because that comes up a lot. People are wondering this. Let us say someone has a significant portion of their net worth in a 401K or an IRA. Let us say it is 50% or more of their total asset base. There are things which they would like to deploy that money towards, but they look at the money that is in that 401K or IRA and think, Wow. If I pull that out, after all is said and done, I might be taking a 50% hit on that right now. How would you help somebody walk through that calculation?

Bob Fitzwilson: Going back to my computer software and tax planning days, the tax code was not architected. It is a hairball of things that were glued together. So there is no thing as a person’s tax bracket. It has been the kind of income you are testing and the amount. So for those familiar with Disneyland, you might be in Frontier Land with ten dollars and change and you could be in Tomorrow Land before you know it in a completely different tax bracket or it could be a million. You just cannot do it in your head. So people might say, Well, I am going to lose half of this to taxes, but they have not run a tax projection yet to see where they really are.

The first thing I would do is have their tax professional run a base case of here is where I am and here is what happens if I take money out. Oftentimes you can take money out that only hits the lower bracket. So it is critical before anybody does something to have somebody that they trust run a tax projection and see what the actual tax hit would be. Then after that, like I said, it is an ugly decision. Perhaps you can mitigate it by taking some out now and some out later. But I see no way that taxes are not going to go up. I believe it was in the late 1980s after they told us to save all this money that they then told us that we saved too much. Then they came out with an excise tax. I think it was 10% or 15%.

So my assumption is that anything is possible, but make it personal. Do not use a rule of thumb. Run a tax projection. It could be going back to the holistic view of family finances. Take a look at the big picture. If you had a huge IRA and wound up losing 40% to taxes but that 60% left over made you financially independent, then who cares? It is safer to lock in your financial independence than to run the risk of something bad happening to the money.

Chris Martenson: Right. I am thinking of Greece and Japan. Who else has raised taxes recently? There are all sorts of levies, fees, and little interesting incremental things that have happened, but when governments get strapped for cash, they raise taxes. That is historical. You can take that one to the bank. That is pretty much a guarantee.

Bob Fitzwilson: There was just something two days ago, I think, where Spanish depositors were told they can get their money back – but only a portion of it. Then they would pay them back over time. So that is the story.

Chris Martenson: That is enforced borrowing by the government. That is interesting.

Bob Fitzwilson: Yes. I am just reacting to where we are, not to what I would have hoped. But your work showed that they have to get the nominal GDP back up to the debt growth and the obligation growth. One of the great questions that I have had is about the obvious solution here. It is going to create a lot of inflation down the road, but it is like somebody losing their job. On their mortgage, they have this fixed debt. The income went away. You have to get the income back even if it is inflated dollars. Otherwise, you have a structural problem.

Chris Martenson: Well, yes. Those structural problems have been accumulating for a while. That is a different conversation, which I would love to get to, but it does point to the idea that we will be seeing more of the same. We will see when the next QE (quantitative easing) comes.

I would like to turn to precious metals now. First, let us start with your position on precious metals and whether you agree that these are a useful part in portfolio allocation.

Bob Fitzwilson: Yes. It has always been in our DNA. Remember, we started in 1979. So I think our allocation between 1979 and 1980 was around 15%, but in those days you had alternatives, currencies analogous to your border analogy with Germany. We had the Swiss franc, the Deutsche mark, and the yen. We still call the category the “dollar hedge.” So you could hedge a risk by going to those, but we also had real estate. Real estate was a terrific asset class in that period. So we had a large allocation there. We had a large allocation to Asia at that time. None of – most of the circumstances are not true anymore. It is all currencies that are getting in trouble. So the allocation to precious metals is significantly higher than it was in those days just because that is pretty much the only game in town in terms of alternative forms of money.

As you probably know, we view the bullion as money, as humans have done throughout history. I joked that when the first guy in North Africa fled, he did not load up his plane with derivatives. He loaded it up with gold. So in terms of preserving wealth, history tells us that gold and silver are the primary formats. So yes, we have a strong belief in that. You have to. I have used an analogy of bar stools and all of the same currencies being on stable ground. What is happening is, the currency bar stools are sinking. If you are standing on one of those looking up you are saying, My goodness. Look how high gold is going. The truth is that the currencies are sinking.

We are going to hit the stage where we have a hyper-deflation of currencies. It will happen quickly. So for money that is allocated for wealth preservation, there is nothing better than holding the metals. We have an allocation with the miners. These are businesses. My recollection is that the miners did not take off until the late part of the cycle in the 1970s. The problem in this cycle is the price of gold and silver is up, but the operating costs have gone up. I read that one company has gone from using 14 gallons of diesel per ounce of gold to 40 gallons of diesel per ounce in the last 10 years.

Chris Martenson: 40 gallons.

Bob Fitzwilson: Those are more long-term oriented. You are going to need to have the price of these metals really break through and have the expenses stabilize before you can expect to get what you are hoping for there.

Chris Martenson: Yes. There have been a few things on the miners, not the least of which was that there was some shared dilution going on in some of the bigger players there for a while.

Bob Fitzwilson: Right.

Chris Martenson: The cash flow from operations has not been knocking me off my bar stool. I am waiting. But I think if gold really takes the next run here, as it breaks out of this pennant and heads off, obviously miners would have a role to play there. Here is a question, though: How do you know when it is time to sell gold? Maybe there are people thinking that gold has already had its run. What are your thoughts there? How will you know it is time to sell?

Bob Fitzwilson: May I add just one comment to what we just discussed?

Chris Martenson: Yes. Sure. Go for it.

Bob Fitzwilson: So throughout my career there has been a phrase called “laddering,” where people, when they wanted to get conservative, would ladder a fixed income, whether it was Treasuries, Munies, or corporates. Laddering means you divvy the money up over different maturity dates. In this cycle, what I tell people is that they should have a laddered wealth preservation portfolio and not in fixed income because rates are at historic lows. They are actually toxic and dangerous. A laddered wealth preservation portfolio is going to include metals, miners (particularly energy), food-related ones, technology, and things like that. It is getting into real assets – not in a bunker mode, but just getting into things that are most likely to benefit from the next cycle.

As far as when to sell gold, I have always said when they stop printing. Gold is going up only because they keep driving the currencies into the dirt. I would welcome that day. I do not want to, frankly, own gold, but as these obligations keep going up and budget deficits keep going up, I think they really do have this singular choice. They either print, or we go into a massive deflation. Frankly, in the last week and particularly in the last couple of days, it looks like they are going to print. Brazil just announced a huge stimulus package. I heard this morning that China is making hints that they are going to do it. Frankly, they have to. Even though it is not good economics at this point, I wish they would just get on with it and start printing.

Chris Martenson: I am kind of waiting for them to get on with it too. I think Japan is going to have to print as well. We look at their current account that is perilously close to zero as their trade surplus morphed into a deficit. The U.S. is clearly making noise about printing. Europe has to do it as well. Yes, let us get on with it. Here is a question: How are precious metals taxed? Are there legal strategies for minimizing these taxes?

Bob Fitzwilson: In the U.S. I think they are taxed at a maximum of 28%. They are considered collectibles, but again, you have to really look at the specifics about a person’s situation and not just use rules of thumb. I heard a year or two ago that silver was subject to the VAT tax. I did not do much research behind that. There are going to be differences, but this is not – Most of the mistakes I have seen made in my career are people trying to minimize their taxes. They wound up minimizing their assets. So you want to try and optimize around these things, but the main thing is to get the allocations right and protect your money.

Chris Martenson: All right. The next question is, are retirement accounts suitable vehicles for investing in precious metals? This sort of combines the last two, this topic and the last one.

Bob Fitzwilson: I think if we forget the tax issue, confiscation issue and all that stuff, the other issue is, who really has the metal, and does it exist? So if you are going to have metal custody by somebody else, you have to make excruciatingly clear whether it is allocated to you and where it is. There are indications that there may be games being played. Certainly MF Global was a good example of that. So if you are going to keep it in an account, or frankly even with a brokerage account, you have to be crystal clear whether it exists, who owns it, and how you get access to it.

Chris Martenson: Right. So let us talk about the risk that might exist with gold. It is actually one of the most intriguing characteristics about it but it is also a risk. Here is the intriguing characteristic. What do you think the chances are of gold getting remonetized? That is sort of the opportunity, because if it does, we could all make up numbers for what the remonetized level might be. Then the risk embedded in that for some is the idea that if it ever got to be remonetized, it would be declared a substance of national emergency or interest and potentially confiscated. Where do you stand on the ideas of remonetization and/or some sort of nationalization at some point?

Bob Fitzwilson: I think it will be remonetized because that is the way it has always played out throughout history. The cycle is always the same. It starts out with some form of metals, oftentimes gold and silver, but it has been copper and iron. Then some form of derivative gets created. Then they abuse the derivative, a massive amount of it grows, and then it collapses. Then it goes back to the real assets. So it is no accident that central banks are gobbling up as much gold as they can, because if there is a change in the currency status at some point, to play this game you have to have something that people believe in to be able to go back to printing currency again.

For me, what matters is the stable relationship. Some people say there is not enough gold to do it. I say, I do not care if it is an atom of gold. Currency is an intermediary between transactions. All I care about is that it is tied to something that is not going to change and will not be abused. So it has been our history. As a kid and until I was almost out of my teens, I used silver as money. So the idea that you are wacky and crazy if you believe in monetizing gold and silver is bizarre to me, because that is how I started out my life.

Chris Martenson: That was part of your actual life. So one of the most interesting relationships that I look at is the price in grams of gold. It is suspiciously flat. It is amazing that through all of the gyrations, I think of both of those as fairly high beta commodities. They have a lot of wiggle in their daily and monthly price charts. Yet despite all of that, when you look at one compared to another, there is a relatively stable relationship there, which speaks to me of the idea that it was the bar stools that were going up and down. It was not the gold. Gold and oil have had a very constant sort of utility in our landscape.

So their relationship to each other has not changed. What has changed is the relationship of money to those two commodities. I am expecting a lot more of that shifting going on. But gold and oil might maintain that stable relationship, which to me means by holding my wealth in gold no matter what happens to the price of oil, I am hedged, as it were, exclusive of these other considerations of higher taxation, nationalization, or other things that might happen.

Bob Fitzwilson: One of the changes in my thinking in recent years is that you do not want to have a sole focus on gold and silver because all kinds of bad things could happen like confiscation, taxes, robbery, and all that stuff. The really healthy thing to do is what you pioneer and just view it as a part of your life going forward. So if you develop a skill, that cannot be taken from you. If you grow vegetables that you consume, that probably cannot be taken from you. You just have to view it in terms of your life and not become totally sucked in and obsessed by how much gold and silver you can get. This is about moving forward with our lives and our families.

Chris Martenson: I agree. Gold has always been a transitional element to me as we transition from this fascination with fiat paper back to something else – things. The transition is taking longer than I thought, but –

Bob Fitzwilson: Well, we thought bicycles were going to be a big deal in 1980. They were 10 years later. So these things are humbling when you try to figure out things. Again, that is why I try to emphasize to people that it is fun to intellectualize about this and study it, but it is a dynamic, chaotic system, where every man or woman is for themselves. So it can take longer than people expect to manifest itself in many ways before the end conclusion.

Chris Martenson: Yes. Well, we are almost out of time here. I want to close with what I think is an extremely important question here. I am hoping you can answer this, because this one is on the tip of a lot of tongues these days. The question is this. With markets so manipulated by the big interests and infected by the HFT, which is the high frequency trading algorithms, how can a financial advisor recommend being in them? “Them” being the markets.

Bob Fitzwilson: I think it is what I touched on earlier. This is actually a kid-in-a-candy-store time if you are avoiding what the computers and the high frequency traders are playing. Let us say that you want to buy a stock that the computers are playing with. We have all seen these graphs. It is like a muddy pond. It seems calm on the surface, but there are all kinds of beasties going on underneath the surface. You cannot control that. What you can control, though, is to try and find investments in companies, businesses, and products that people are going to want going forward. They will. So if somebody nicks you on your stop loss in the short term or on the spread, there is not much you can do about that in the short term.

Where you are going to really make your money is not the pennies you lost on the spread. It is on the tens of dollars or hundreds of dollars you are going to make if you get the story right. Again, with the vast majority of securities, these institutions cannot even play there because they are just not big enough or the volume is not big enough. So look for something that is a great business, domestic or international, with great products and a great outlook. Then take advantage of the HFTs. If they drive something down, step right up and load up your portfolio.

Chris Martenson: That is great advice. I assume you have things that you are looking at that you like and are interested in. We will not get into those right now. I like this idea of the judo move on the HFT algorithms, because what they are doing is playing with price exclusive of almost any other piece of information, which means they are going to get the price wrong, both up and down quite often. But they do not care about that, because what they care about is battling each other over the minute shifts in price. It does not matter if it is overvalued or undervalued dramatically. So you are saying sometimes that behavior of theirs creates opportunities.

Bob Fitzwilson: My solution would be to create another Las Vegas, where all these people go with the best minds in the business with the best computers and let them go at it, but just disconnect it from the actual capital markets.

Chris Martenson: That would certainly be fun.

Well, Bob thank you so much. We did not get to all the questions. I want to point that out here. We will get to them, if you are willing, in a subsequent podcast, but thank you so much for your time today.

Bob Fitzwilson: It is my pleasure. Any time.

Chris Martenson: Excellent. If anybody is interested in working with any of our endorsed financial advisors, I would invite you to go to the homepage of www.PeakProsperity.com. Scroll to the bottom. Down there under “resources” you will see advisors. Just click on that. We have a process. We will be able to work with you and get you pointed in the right direction if that is of interest to you.

Again, Bob, thanks so much.

Bob Fitzwilson: My pleasure. Any time. Thank you, Chris.

About the guest

Bob Fitzwilson

Mr. Robert Fitzwilson is the President and Director at The Portola Group, Inc. He founded the firm in 1979. Mr. Filtzwilson has invested in more than 25 companies and founded several software firms. He is a Director of SOMA Networks. Mr. Fitzwilson obtained a B.S. degree in Industrial Engineering from the Purdue University and an M.B.A. from the Stanford University.

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28 Comments

jumblies's picture
jumblies
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Terrific interview

That was a great interview, Chris. Much more a frank discussion than a sales pitch. Are there some uk-based financial adivisors you could recommend? 

ao's picture
ao
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Maybe I missed it but was

Maybe I missed it but was JAG;s excellent question about the most hated assets answered?

Travlin's picture
Travlin
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No

ao wrote:

Maybe I missed it but was JAG;s excellent question about the most hated assets answered?

No it wasn’t Ao.  Nor was the question about tax rates on gold, or most of the other questions.  Fitzwilson talked a lot, but he didn’t say much.  I’d like to see this series continued, but with a different person.

Travlin

Doug's picture
Doug
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very helpful

l found the interview very helpful.  I am at a major transition point in my life, and Fitzwilson gave me a roadmap for what I need to do in the near term future.  Thanks very much.

Doug

Jim H's picture
Jim H
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Most hated asset...

Certainly one of the more hated, more undervalued assets are in fact the miners.  Regardless of the increased costs due to energy, many of these stocks appear to be deep value plays based on simple metrics like PE and Dividend rate;

RVM, PE = 5.9

VGZ, PE = 4.1

GORO, PE = 14, Div = 3.9%

IAG, PE = 13, Div = 2.2%

GFI, PE = 10.3, Div = 4.5%  (yes, 4.5%)

One should realize that possibly the best play available in the stock market is a high dividend vehicle that has real growth potential in the underlying stock... in this respect, I can think of no better double whammy stocks than some of the above.  

Several bloggers that I follow have written about the current cheapness of miners relative to price of Gold itself ;      http://truthingold.blogspot.com/2012/08/friday-chart-porn-value-play-of-...

"As you can see, despite the 11-year move in gold, which has taken gold from $250/oz to as high at $1900, the market value of mining stocks in general has declined in relation to the price of gold by extraordinary amount since its peak in 1996, when the price of gold averaged around $380/oz and silver around $4.80/oz.  Does this make sense, especially given that the large mining companies have steadily increasing their dividend payout ratio and throwing off record amounts of cash flow?
 
Either the market is pricing in the expectation of gold and silver selling off to the level where they started this bull market or the universe of mining stocks represents the value play of the decade."
 
I think that we who frequent the Liberty/doomer/prepper/ZH/CM.com circles can sometimes get to thinking that all anyone is talking about is Gold and Silver.. the real truth is that almost nobody owns either the metals or the miners.. and many of the uninformed sheeple are happy to adopt the Mass Media propaganda that Gold is in a bubble, supported by the cartel-induced paper price fluctuations which can certainly be stomach turning on a short term basis for the uninitiated.   
 
I am quite sure that JAG won't care for miners, because he is anti-Gold in general... nonetheless, I agree with Dave from Denver, and this comprises my main specific stock-based investment thesis at present under the more general macro strategy of investing in PM's.  If and when the mining stocks hit their footing, going up by some multiple, my goal would be to convert them back to metals (in the brokerage acct) via PSLV and PHYS, and hopefully at that point get the shares directly registered.             
ao's picture
ao
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Travlin wrote: Fitzwilson

Travlin wrote:

Fitzwilson talked a lot, but he didn’t say much.  I’d like to see this series continued, but with a different person.

Travlin,

I'm glad I'm not the only one who felt that way.  There were some useful bits of information but not much. A fair amount of it was a rehash and distillation of what is pretty common knowledge on this site.

ao's picture
ao
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risk, businesses, and taxes

Thanks for that well thought out answer Jim.  The problem for me personally is that I'm already overexposed to PMs and investment in the miners would increase that exposure even more.  Also, I'm very risk averse at this stage in my life and the miners entail more risk than I'm willing to presently entertain. 

I'm realizing more and more that I need to open another business and after going to Europe and getting some ideas of products and concepts that would go over well in the US (but have seen minimal exposure here), I need to explore the import-export area. 

One other comment is that I disagree with Fitzwilson on the tax issue.  The greatest fortunes were built on businesses (not buying stocks of those businesses) and then legally maneuvering around the tax laws so that wealth could acrue more rapidly.  The Rockefellers are a case in point.  I've recently recognized that an area of weakness in my knowledge is taxes and I hope to spend the next year or two addressing that deficit.

My education is starting here:

http://www.amazon.com/Tax-Free-Wealth-Permanently-Lowering-Advisors/dp/1937832058

robbie's picture
robbie
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Roth IRA?

No discussion about the Roth? It impacts just about all of the areas mentioned.

RPwannabe's picture
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Keep 'em Coming...

This was a good start, and I'm sure the Q&A interviews will get better and better.  

hucklejohn's picture
hucklejohn
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Good interview

I think it was a fine interview.  There was not enough time to get to very many questions, however.  I suggest a follow-up interview merely devoted to answering questions.

hucklejohn's picture
hucklejohn
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Returns

"On the theme thing, the studies have shown through my career that 90% of the returns come from your allocation."  I could be wrong but I recall that this idea was one of the major flaws in Modern Portfolio Theory & has been put into much question.  

hucklejohn's picture
hucklejohn
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Roth IRA

In discussing retirement accounts the Roth IRA should have been included in the discussions.  We are left with some uncertainty as to whether the negative comments on IRAs & 401k plans also apply to Roth IRAs.   

Macs's picture
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Miners - join the dots

Fitz: oil use for gold mining up from 14 to 40 gallons/ounce

Chris: gold and oil prices in remarkable lockstep

Me: is this trend your friend???

With gold as in other 'commodities' like oil or copper, we are chasing ever more dilute resources. There comes a point where it makes no sense. The cost is rising faster than the value - I'll keep buying the product, not the producer.

Jim H's picture
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Macs

Long term, ore grades are decreasing, and the costs of mining, influenced heavily by energy costs, are increasing... so your point is well taken.  What I am suggesting though is a much shorter term investment opportunity in the miners... over the next year or two.  While Gold and Silver may double, triple, or more, I expect some of the smaller miners to increase in value by 10X or more.  Assuming the metals take off from here, the earnings increases at miners over the time period I am suggesting will far outpace the negative effects of energy prices.     

Miners are more speculative than the metals themselves, but offer more potential return....   

Oliveoilguy's picture
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Miners

Good Advice Jim H. 

Looking at GFI, I see risk in location, also Google Finance says div=3.3%.

I like the royalty plays like SLW and the more conservative GG which has a small dividend.

Miners are 3rd. on my list of ways to play PMs. Ist. is physical. 2nd. is safe bullion (CEF) and then finally the miners.

I will take a look at GORO. Thanks 

Oliveoilguy's picture
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If Bob Fitzwilson was a Farmer

If Bob Fitzwilson was a farmer and I asked him how to grow corn, I would want specifics. Not a statement like "keep some silver in your safe in case you have to buy corn on the open market".

I found myself agreeing with everything he said, but wanted more specifics on money management. 

When asked what a 50 or 60 year old guy should invest in, he advised keeping your skills sets honed and continuing to work.  OK...But if I'm working who is going to give me investment help?

I really like Bob's macro view, but still don't know for example what % he allocates to PMs.

Also would like more direct questions and direct answers from those that were submitted.

My one takeaway is that he thinks cashing out of retirement accounts might be an ok strategy, and that you don't really know the tax implications till you do a personal projection.

Good Interview but needs to be more focused on the topic of investing.

treemagnet's picture
treemagnet
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Don't get it.

Why not just prep and buy things bernanke and friends can't devalue.  Good stocks will be sold with the bad - hedging losses, locking in gains, going to cash.....whatever.   When this thing locks up and goes no bid, you can be ready to sell, with your finger on the keyboard, and/or screaming at your broker to get you out - and it won't matter.  Low volume markets composed of HFT's trading the same stuff to each other in a circular firing squad won't treat the retail guy any better than the prettiest new inmate.   I think someday it'll be 1982 again, it'll be time to be diversified, go long, and go to the beach - but not now.  The markets rigged, the playing field is loaded with criminals and thugs, cheating is encouraged and rewarded, the refs are bought and paid for, the announcers and sponsors ignore what they choose, the fans are lunatics who want blood and pain and by God, if you step on that field... well, the show must go on.  Maybe some of you are quick and agile enough, good luck I guess.  I'd like to play again when its fair.  For God sakes, Corzine's starting another hedge fund?!  Thankfully, this fall it looks like a fresh new slate of reality tv programs! 

Bob Fitzwilson's picture
Bob Fitzwilson
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Thank You

hucklejohn -

I think your idea is a great one, and I would be pleased to help if asked.

Bob

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Bob Fitzwilson
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Modern Portfolio Theory

Modern Portfolio Theory (MPT) had its day in the sun.  Sharpe was a professor of mine in business school.  He is a very intelligent man.  His theory appeals to the hunger in all of us for an understandable, almost mechanical way in which to invest money.  For those that do not know much about it, key aspects are "alpha" and "beta".  Close your eyes if you are math-phobic, but it involves the equation of a straight line...y=mx + b as we were taught in school.  "m" and "b" are not very sexy, so it was changed to "b" for beta and "a" for alpha.  The beta represented the slope of the line...think seesaw....and the alpha was where the line crossed the y-axis.  If I remember correctly, you plotted the returns of a stock for the past 200 trading sessions versus the S&P 500....put those points on a scatter diagram with an x- and y-axis, and then mathematically drew a line that best mirrored the pattern of the dots.  Beta is the slope of the line, alpha was the crossing point on the y-axis.  A steep line/high beta meant that when the S&P moved a little, the stock moved a lot both up and down.  When the S&P 500 showed a zero return and the stock under investigation still showed a positive return, that was the "alpha"...what you got when the market in general did nothing.

The line was called the "characteristic line" for the stock under investigation.  Since each stock has this "systematic risk" -- S&P doing one thing, the stock doing the other in concert -- the idea was that you could pick a slope that matched your ability to handle risk.  Steep slope = not for everyone, gentle slope = probably for most.

One problem was that each company represented by the stock market had "specific risk"...e.g. bankruptcy, product line problems, competition, etc.  Sharpe et al determined that a portfolio of 17-20 stocks with a characteristic line with a specific beta gave the expectation that you could chose your slope and your alpha, but the specific risk would be minimized given that there were multiple stocks involved.

That was the theory.  Graduating in 1973 and thinking I had been given the secret weapon with which to invest, we tried to apply it.  General Motors had a very low beta (slope) based upon the prior 200 trading days.  However, the '73-'74 bear market was caused by a drastic increase in gasoline costs.  A manufacturer of gas guzzlers was not a good place to be.  GM dropped like a stone.  I discovered that it is the future beta that matters not the prior beta.  If I only had the future 200 trading days to compute the beta, I would be in great shape.  Alas, I realized that if I could foretell the future, I did not need Bill's theory...:-) .

Another aspect of the mechanical investing crowd was to build a portfolio of non-correlated assets.  Think of pistons in an engine.  The pistons go up and down, but the car keeps moving forward.  That approach works if you are in a generally positive investment environment as we were from the early '80s until the early 2000s.  Unfortunately, the correlations are not static.  They change.  This was apparent for all to see in the 2008 meltdown.  Virtually everything converged on a correlation of 1.  It probably would have been total had it not been for trillions of dollars spewed out to save the banking system and sovereign governments (think bonds).

The last mechanical approach that I will mention is this idea of "small cap", "mid-cap", "large-cap", and "domestic vs. foreign" investing.  First of all, I never understood why the capitalization was a factor unless the company was truly huge or tiny.  The law of large numbers was the consideration for the former and liquidity, the latter.  As I would hear people talk about this over the last ten years, I finally started accusing people...with a wink...:-)... of investing in adjectives.  They would describe their style and allocations using these adjectives, but could not tell you what they really owned.  That is a very careless and hazardous way to invest.  It is promoted by the all-powerful consultants, so it is hard for people to stray from the mindset, though.

A major reasons that mechanical investing schemes fail is that economics do work in the long run.  If someone does have a unique approach, it attracts a huge following as well as vast sums.  As the advantage becomes well known, the excess profits shrink and ultimately disappear.  There was alpha when T. Rowe Price and John Templeton were in the heyday of their careers.  Templeton was investing in such areas as Japan and South American decades before the rest of us.  The disappearance of alpha and the correlation of assets has to do with global markets, the Internet and the massive increase in the size of the investment pool created by the increase in population and the massive amount of fiat currency that has been created.  There are exceptions, but alpha in the past decades involved leveraged-beta for most.

What I was trying to convey about allocation being so important is that it is still just as true as it always was, but it should be based on common sense themes and where Chris Martenson's followers believe we are heading..and I am one of them.  You don't need alpha and beta, you don't need Monte Carlo simulation.  You don't need mindless allocation sold to you by the wire houses.  Use your head and common sense.  Peter Lynch of Magellan fame was the master of this.  He went to the mall.  He saw what people were buying.  He would look for major trends in the population and the economy.  If he liked the sector, he would just buy all of the good companies in that sector.  There was little consideration to indexing and looking like his peers.

The pendulum has swung back to the so-called little guy and the patient analyst.  The institutions have too much money to invest in anything other than a small universe.  The HFT crowd are really just battling each other at the nanosecond level for an ever-decreasing piece of the action.

Institutions also operate by a creed: look like the others.  When it comes to gold, silver and the miners, they will be loathe to take positions until they have no choice.  There is no personal upside for being an oultlier if you are wrong.  They will stay with their peers in group think until the crowd moves.  That will come, but at much, much higher prices.  For many, keeping their job and their cash flow is what matters, not absolute performance.  For those who have expressed frustration about being ignored by their brokers and advisers, if you are with a large firm, recognize that your concerns will not be addressed until it is common knowledge.  That is why you should be applying common sense, history and open thought to how you approach your money.

Bob Fitzwilson's picture
Bob Fitzwilson
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Most Hated Asset

I would have to say that social media would be at the top of the list.  That does not mean that it is the best area in which to invest nor should all social media stocks be rejected.  Sometimes you can find a real jewel being trashed along with the rest of the companies in the sector.

From an action-taking standpoint, you want to find something that has a great long-term outlook that is being thrown away.  That is not the same as universally despised.

Bob

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Jim H
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Bob F...

LNKD, with a PE of 830... does not fit my definition of a most hated asset.... you are playing to a very tough crowd here, sorry.  FB may be diving... but their problem is one of showing some ability to really monetize the business model.. at least LNKD has some corp. job search traction.  FB PE ratio remains at 65.... not yet hated enough for me to be interested.  How about some AMZN, with a PE of 293????  I post these numbers because to me, PE ratio is a direct link to how "hated" an asset class is... do you disagree with this view?        

Oliveoil... thanks for the comments on miners... the asset class with the PE ratios in the range of 10... not 830.  The difference in dividend yield you sight is one of forward looking, vs. trailing dividend rate.  Note:  GG is one of my biggest single holdings right now... and your point about the need to diversify geographically/geopolitically (with respect to GFI) is a very good one... the video of the South African police/military gunning so down the "machete" armed striking Pt miners is just disgusting.  Slaughter is a word that comes to mind.    

ao's picture
ao
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perishability

treemagnet wrote:

Why not just prep and buy things bernanke and friends can't devalue. 

Because the two things we need the most that will wind up costing us the most with what is coming, food and fuel, are perishable.

lagartija125's picture
lagartija125
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Crash course book

Can anyone tell me the name and availability of the book Crash course (the latest) in Spanish?  I need a copy for my wife and others.  Thanks

earthwise's picture
earthwise
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Re: perishability

While food and fuel are indeed perishable, the means to produce them i.e. farmland or oil weels are not. While most can't actually buy an oil well, buying a farm, even a small one is within reach of just about anyone who is determined. A farm that produces food can help insulate one from what Bernanke has wrought. Heck, with the right setup one may even be able to produce fuel; just ask Ready.

hucklejohn's picture
hucklejohn
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Looking forward to follow-on interview

Obviously Bob FitzWilson is a very experienced & knowledgeable financial advisor.  The first  podcast seemed to focus on Bob's background & general investing philosophy rather than answering specific questions.  I am looking forward to his next podcast where my preference would be for a more question and answer format where our specific investment concerns are addressed.  I consider his podcasts to be a very valuable addition to this site especially given the huge disconnect between mainstream investment advice and the reality of the current financial environment.   

eatkamloops.org's picture
eatkamloops.org
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Port-fool-you

Port-fool-you. Sorry, for making up words but I have to laugh about these things or I might start crying and end up a puddle of water on the floor.

I want to tell a story about my "backyard". There is a copper mine going in. It's big, really BIG. It will cover ten square kilometres and employ 1000 men for the build-up and 300 men permenently. It's going to be great for my business because I am in the last industrial park before the mine. I will be rewarded richly for just being "lucky" with my location.

But the mine will contaminate the little water on the Knutsford plateau. One of the biggest ranches in Canada, Sugarloaf Ranch, has been bought out by the copper mine so they could have the surface rights too. The ranch I use for my lamb and cattle meat, Jocko Creek Ranch, will be under a tailings pile. A lake I drive by will be gone. Some people say that's okay because its just a alkaline swamp anyway. When society needs copper despoiling an area is a price worth paying. All I hear about the mine is all the "great" jobs that will come from this project but I hear little about how the environment will be charged.

The big disconnect I see it that people don't seem to wonder why they get paid such great wages or why their port-fool-you increases. Do they not realize that there is money in "raping and pillaging" the environment? And what about the health of the people down stream from the mine. Do we think about their longterm health? No. We are just looking for a nice fat return on our port-fool-you, thinking that this will be a great thing. Have you done any meaningful work for the dividend or increase in your stock port-fool-you? Think about it. Are you adding to the problems of the world or solved the problems of the world with your investment strategy? Or are you just trying to save your own butt? Looking for a "big fat return" on your money is just bring the cliff closer for us all.

Get a small piece of land. Grow your own food. Live in a very small house. Make your own energy. Learn the meaning of "enough". Stop supporting the "people" and "organizations of people" that are raping and pillaging the planet. These actions are enough to change the world.

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Oliveoilguy
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port-fool-you

Get a small piece of land. Grow your own food. Live in a very small house. Make your own energy. Learn the meaning of "enough". Stop supporting the "people" and "organizations of people" that are raping and pillaging the planet. These actions are enough to change the world.

eatkamloops.org

That really says it all. 

Makes me realize I need to look at my investments and make sure they are in responsible places.

eatkamloops.org's picture
eatkamloops.org
Status: Member (Offline)
Joined: Jul 5 2012
Posts: 5
Pool-fool-you

Here is the full Port-fool-you. I hope you enjoy it. The most effective tool against oppression and slavery is an awake mind:

http://eatkamloops.org/port-fool-you/

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