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How To Position Yourself Now

Components of a good investing plan
Friday, June 13, 2014, 12:13 AM

Executive Summary

  • Planning determinants for:
    1. Precious Metals
      • Bullion: physical
      • Bullion: stored & tradable
      • Miners
    2. Stocks & bonds
      • Remaining long
      • Strategies for shorting
    3. Real Estate
    4. Debt Management
    5. Income Security
    6. Local Investing
    7. Personal Preparations
    8. Community Preparations

If you have not yet read The Good News In All The Bad Data, available free to all readers, please click here to read it first.

Though we strongly advise in Part 1 to move to cash, it's essential to remember that this is largely a transitional maneuver. The goal is to keep your powder dry during the coming deflationary storm, and then deploy it in as intelligently and timely a manner as possible when your dollars can buy quality assets at excellent discounts. In this Part 2, we walk you through the principal components for building your investing action plan for both in advance of, and when, that time arrives.

Also, we understand that for reasons of options and attitude, simply moving your portfolio 100% into cash is unpalatable or unrealistic for a number of people. Some of you will want to, perhaps even need to, have a percentage of your capital remain in the financial markets for the foreseeable future. So we discuss both long and short strategies for you to evaluate and pick whichever best suits your personal situation.

It's important to understand that the solution set contained below is a superset for your consideration and not a one-size-fits-all recipe (i.e. do NOT take it as personal investment advice!). As strongly urged in Part 1, its best use is as a structured guide for you and your financial adviser to use together in discussing and developing an investment plan customized to your goals, needs and risk tolerance.

Suffice it to say, everything discussed in this report (even the % cash component mentioned in Part 1) should be reviewed with your financial adviser before taking any action. Am I being excessively repetitive here in order to drive this point home? Good...

Precious Metals

One of the biggest mysteries that continues to perplex Chris and me is: Why is central bank liquidity creating price bubbles in every asset class EXCEPT the one you would expect it to most?

Here we have everything from Facebook stock to Las Vegas houses to junk bonds to Beats headphones catching bids at insane prices. As Chris discussed last week with economist Steen Jakobsen, the data for stocks over the past year shows that the worse the balance sheet, the better a company's stock performance has been.

Why is everything down to pure crap being lifted by the giant pool of money sloshing around the planet, but prices for gold and silver -- arguably the highest-grade assets to own -- are so badly languishing?

I won't rehash all of our speculations for why, as there are dozens of recent articles on this site speculating on the topic. But as this year's mega-report on gold drives home, the actual fundamentals for owning precious metals not only remain intact, but they are expanding materially each year. 

Well, the good news here is that the precious metals market is the one place you don't have to wait for the "buy at pennies on the dollar" experience. It's here now.

Prices are not only far below what the fundamentals justify, but... » Read more


Jingran Hu |

Rising Resource Costs Escalate Odds of Global Unrest

The critical 40% income-to-food threshold
Tuesday, May 13, 2014, 9:34 PM

As we observe the growing unrest in Ukraine, there is the usual rush to ascribe a cause. Was it meddling by the West? Russia? Was it corruption by prior leaders? Simmering resentments that stretch back centuries that finally erupted?

The answers apply to Ukraine as well as to many other countries. Which is why having an accurate framework, a clear 'lens' for seeing what is actually transpiring, will prove far more useful to you than 99% of what you will hear on the ni » Read more


Teresa N. Fischer

The Stock Market's Shaky Foundation

Crumbling fundamentals in both the short term & long
Wednesday, February 26, 2014, 7:21 PM

According to the stock markets in the US and in Europe, the world’s economy is not just in good shape, but is in the best shape it’s ever been

The S&P 500 hit an intraday new record high of 1858.71 on Feb 24, 2014, and is now 18.6% above the peak it hit in 2007, a moment everybody now recognizes was heavily overvalued.

A nearly 19% gain above the prior all time high is an enormous and unusual event.  Surely there must be an equally compelling story and loads of fundamental data to support such a bull market? » Read more


Bowie15 |

The Trends to Watch For in 2014

Government overreach, economic stagnation & civil discontent
Tuesday, December 31, 2013, 1:11 AM

At the beginning of this year (2013), I identified eight key dynamics that will play out over the next two to three years (2013-2015). Let’s see how the trends developed... » Read more


Get Ready for Rising Commodity Prices

Driven by hot money seeking a low-risk haven
Tuesday, July 16, 2013, 8:27 PM

The human mind seeks a narrative explanation of events, a story that makes sense of the swirl of life’s interactions.

The simpler the story, the easier it is to understand. Thus the simple stories are the most attractive to us.

But conspiracies and power groups do not always provide comprehensive explanations for what we observe. » Read more


Ward Hooper

Finding Your Way to Your Authentic Career

Transition to the fulfilling work you were meant to do
Thursday, June 6, 2013, 9:22 PM

Unfulfilled by your job? Wish the work you do on a daily basis were more aligned with the person you are (your interests and values)?

You're not alone.

In fact, the majority of workers would chose a different career path if given the chance. » Read more


Jennifer Winn: How to Successfully Transition to a 'Great-Fit' Career

Self-understanding & visioning
Thursday, June 6, 2013, 4:29 PM

As many Peak Prosperity readers know, I was on a very different career track before opting out of the corporate race and teaming up with Chris.

To maximize my odds for success in transitioning not just to a new job, but also hopefully to a lifelong "great-fit" career, I spent a lot of time studying the science of career management and engaging with a platoon of professional consultants and executive coaches. Through this research, I learned that there are indeed time-honored practices that statistically and materially can improve your chances for identifying work that matches your aptitudes and passions AND for finding gainful employment in this new field. » Read more


Marking the 4-Year Reflationary Rally: How Much Better Off Are We Really?

Growing amounts of data show a failure to thrive
Monday, May 6, 2013, 10:31 AM

The U.S. stock market rally has recently passed its fourth anniversary after the terrifying lows of March 9, 2009.

During that time, massive and unconventional reflationary policy from the Federal Reserve has managed to lift the S&P 500 by nearly 70%. But perhaps even more improbably, it has finally (?) built a floor under U.S. residential real estate prices. » Read more


Let's Stop Fooling Ourselves: Americans Can't Afford the Future

Unemployment, Taxes and Unfunded Retirement are Squeezing Ea
Tuesday, March 12, 2013, 10:24 AM

The truth is: The three adult generations in the U.S. are suffering, and their burdens are likely to increase with time. Each is experiencing a squeeze that is making it harder to create value, save capital, and pursue happiness than at any point since WWII. At that point, we were a creditor nation with an economy exploding into dominance on the world stage. Now, however, the U.S. is the largest debtor nation and our economic hegemony is increasingly at seige across a number of fronts.

A continuation of the status quo is a decision to sleepwalk face-first into the constraints hurtling towards us.

Instead, shouldn't we stop fooling ourselves and ask: What should we be doing differently? » Read more


The Unsafe Foundation of Our Housing 'Recovery'

Overdependence on subsidies, debt, and unfounded optimism
Monday, February 25, 2013, 4:55 PM

What could go wrong with the housing 'recovery' in 2013?

To answer this question, we need to understand that housing is the key component in household wealth. And, that Central Planning policies are aimed at creating a resurgent “wealth effect,” as follows: When people perceive their wealth as rising, they tend to borrow and spend more freely. This is a major goal of U.S. Central Planning.

Another key goal of Central Planning is to strengthen the balance sheets of banks and households. And the broadest way to accomplish this is to boost the value of housing. This then adds collateral to banks holding mortgages and increases the equity of homeowners.

Some analysts have noted that housing construction and renovation has declined to a modest percentage of the gross domestic product (GDP). This perspective understates the importance of the family house as the largest asset for most households and housing’s critical role as collateral in the banking system. » Read more