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How Markets Outwit You …

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Posted by Larry Edelson - Commodities, Stocks, Technical Analysisechnical Analysis

on Wednesday, 13 April 2016 19:05

Strange. Most investors I talk to think the world is doing just fine. They say the U.S. economy is growing and the gains in employment have been nothing short of spectacular.

They say Europe is not collapsing as so many experts have feared. And that Mario Draghi’s pedal-to-the-metal euro printing is working.

They even claim Britain is doing fine, France will escape its troubles and inflation is coming back.

About the only part of the world they’re negative on is China, claiming that if there’s one single threat to global growth, it’s the Middle Kingdom and nothing else.

Well, I’ve got news for them. This is precisely what the markets want you to believe. They have an uncanny way of first separating you from your money, then washing it all down the drain.

When the markets are acting like this, making almost everyone feel everything is just dandy, or will turn out dandy — risk levels are actually at their highest. Investors are lulled to sleep. They’re complacent. They’ve dropped their guard.

And the next thing that happens? Those investors lose their money, big time.

Look. Markets do not change their major trends all that often. At most, a market may change its major trend once every three years. More commonly, they change trends every five years. And even that is rare. Most major trends persist for at least seven years.

Instead, what happens is this. You get a major trend unfolding on cue, with its cycles. Then you get a pause, a sideways consolidation period, often wrought with pullbacks.

The money that is made during the trending part of the move is often given back during the non-trending, sideways portion. Especially by trigger-happy, impatient investors and traders.

It seems they just can’t stand the fact that all markets need to occasionally take a breather. That all markets need to shake out the earlier investors — so new investors can come in. Or so short-sellers can take profits and cover their positions (in bull markets).

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Markets are, yes, living, breathing beasts whose main function is to outwit you. And one of the ways markets do that is to stage what seem like long, sideways periods of tight trading ranges and pullbacks — or rallies in bear markets — that frustrate the heck out of you and force you into making mistakes at the worst possible times — just before the major trends come back to the forefront. 

As they are right now. For instance …



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Personal Finance

Imploding Pensions Take The Rest Of US Down With Them

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Posted by John Rubino - DollarCollapse.com

on Friday, 01 April 2016 06:46

UnknownIt's the same story pretty much everywhere: Cities and states promised ridiculously generous (by today's standards) pensions to teachers, cops and firefighters, failed to sufficiently fund the plans and invested the money they did have very badly. And now the weight of the resulting unfunded obligations are crushing not just plan recipients but entire communities. Here's a representative case:

Oregon PERS unfunded liability swells to $21 billion

(KTVZ) - This week, Oregon's Public Employee Retirement System Board received an earnings report on the status of the PERS fund investment. The report said Oregon's PERS fund fell by 4 percent in 2015, a loss of nearly $3 billion -- and a Central Oregon lawmaker said that means major reforms are more urgent than ever.



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Personal Finance

Retiring Abroad: Ever Thought About It?

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Posted by Nilus Mattive

on Tuesday, 29 March 2016 07:00

I just got back from a week in El Salvador with my wife and daughter, and while the trip got off to a rough start — full of delayed flights and lost luggage — we ended up having a GREAT time.

You might think it’s a little crazy to spend spring break in a Central American country that boasts one of the highest murder rates in the world. But as I recently explained in my latest issue of Income Superstars, it is precisely those kind of headline worries that create opportunities for savvy travelers.

To wit …

We stayed in a luxurious oceanfront room, with its own private plunge pool on the balcony, for less than I’ve paid at a budget hotel in Florida.

When I got out of the surf, a guy stood ready to grab my board, throw a towel over my head, and hand me a bottle of cold water — services I would never request but that were just customary in a place that aims to please.

We never spent more than $25 on dinner — for a family of three, including drinks. The typical entrée of local fish, veggies, and corn tortillas was going for about $6 at one of the “fancier” places in town.   

On one excursion, my guide pointed out some houses in a new beachfront community and noted they were selling for about $100,000. Speaking of which, El Salvador is officially on the U.S. dollar and has been since the early 2000s.

And healthcare? It’s universal, though I definitely had no desire to visit the nearest hospital about 45 minutes away in San Salvador.

Obviously, visiting a place like El Salvador isn’t for everyone. And choosing to stay there for a longer period of time is probably out of the question for many more.

Screen Shot 2016-03-29 at 6.52.29 AM



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Personal Finance

Let’s Gain Some Context of this Market

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Posted by Neil R. McIver - McIver Capital Management

on Saturday, 05 March 2016 03:05

Screen Shot 2016-03-05 at 5.29.02 AM

With the markets bouncing around and headlines in the financial media designed to cause concerns, I thought it might be worthwhile to provide a broader context to the current environment and how that environment impacts your portfolios. As always, I will refrain from trying to outsmart the market by predicting its short term direction because the market will always conspire to make such prognosticators look foolish. That said, I do wish to provide a framework of understanding.

The most important consideration to keep in mind is that your portfolio is mathematically designed to dampen exactly the kind of volatility that the market is exhibiting now. This is done by our group constructing your portfolio with negative correlation. In other words, we use positions which move up or down based upon different economic inputs, such as interest rates and commodity prices. Each and every position in your portfolio is carefully selected because we feel it will be profitable, but each position (or groups of positions) will react slightly differently to one another over any shorter term economic environment. For instance, despite the correction in equity prices generally, the world’s largest gold miner, Barrick Gold, has risen over 130% since last September.

The key take-away is that your portfolio is not the market.



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The World Economy Is Resetting - Are You Prepared?

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Posted by Chris Vermeulen via Gold Eagle News

on Thursday, 03 March 2016 02:01

The major global economies have had a staggering debt of $199 trillion as of Q2 of 2014. The most recent figures will be closer to $230 trillion because, after 2014, the ECB, Japan and China have all resorted to ‘massive monetary easing’ programs while the US debt continues to escalate, with every passing second.  The total debt, as a percentage of GDP, stood at 286%; the latest numbers will prove to be much worse.

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...continue reading HERE

 



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