Whom To Listen To

I managed the investment portfolio of Western National Life Insurance Company from 1960 to 1986, the year I left the corporate world. After that I began managing retirement money for myself and a few friends and family. By the late 1990s I began to realize that I did not have the wisdom, knowledge and expertise to excel, even though I had had years of experience and research. In 1999 I committed the entire project to God, took up a prayer vigil, and ask Him to lead me to the experts whose knowledge, advice and counsel I should listen to in order to succeed. I further told my “clients” that if we had a bad year, I would discontinue the project. I believe the list which follows is the answer to my prayers. After forty years of seeking to learn to invest, I have found only a few people in whom I have any significant degree of confidence. Here they are.  

Available Only On Occasion
1. John Templeton. Along with Warren Buffet, probably the greatest investor of the twentieth century. Now in his 90s, very little new information coming from him. But past writings excellent for research.

2. Warren Buffet. Best source is occasional article or interview, along with the annual report of Berkshire Hathaway, available free on the internet. (www.berkshirehathaway.com). Several books have been written about him, and are excellent. Especially recommend a book which compiles his letters to shareholders for many past years. Don’t remember the name, but I’m sure you can find it on Google.

3. Jim Rogers. A younger man (approximately age 65 as this is written) who appears to be on his way to becoming one of the legends of investing. Has written three books. I strongly recommend Hot Commodities, published in 2004. This is a must read for any investor. In 1999, when he was on CNBC daily, he began telling us we were beginning a long term commodities bull market, which would likely last 15 to 20 years, and which would be one of the strongest bull markets in history. I began that year positioning our portfolios based on this forecast. We have had 8 good years in a row (averaging about 19% per year). We continue to base our strategy on the thesis that the commodity bull will run until sometime between 2015 and 2020. Coming letters will contain what we are learning from Rogers month after month. Learn more about him at www.jimrogers.com, and Google.

4. Harry Browne. (Deceased 2006). One of the best investment minds of the twentieth century. His first book, How You Can Profit from the Coming Devaluation, was published around 1970, and has become a classic. He predicted the devaluation of the dollar, the continuing debasement of the dollar through monetary inflation, and the importance of including gold as part of a diversified investment portfolio. His latest book, FailSafe Investing, was published in 1999. It is short, very easy to read, and is presented in the form of “the 17 simple rules of financial safety,” including rule 11, “How to establish a diversified portfolio which will protect your money in all economic environments.” As this is written, the latest revision of this book may be downloaded from www.harrybrowne.org for a very nominal cost. I cannot imagine a better value. In 1982 he started a mutual fund which follows the strategy outlined in rule 11. It is still in operation and has gained over 9% per year average return since its beginning. Information on the mutual fund is available at www.permanentportfoliofunds.com. This book could be the single most important book you will ever read on investing, an absolute must read in my opinion.

My Top Four Experts I Read Regularly
1. Richard Maybury. Writes Early Warning Report newsletter (10 issues per year). Information available at his web site www.chaostan.com, where you can subscribe to the newsletter, but it comes only by mail, not internet. By far the most important thing I read on a regular basis. Back issues extremely instructive, along with his Uncle Eric series of 10 books (available at www.bluestockingpress.com) He has a stunning twenty year track record, fully documented. An absolute must for anyone who wants to learn to successfully invest.

2. Richard Russell. Writes Dow Theory Letters, which comes 5 days a week by email. Has written continuously since 1958, the longest running investment newsletter in history. A close second to Maybury, with the advantage of daily contact. He is 83, so no way of knowing how much longer he will publish, but as this is written, he’s never been better, An absolute must for the serious investor. You can subscribe at www.dowtheoryletters.com ($300 per year, and worth every penny).  He claims to have 11,000 knowledgeable subscribers.

3. Jim Rogers. Does not write a newsletter, but travels and speaks often. Gives interviews to major financial publications and media outlets. Most of these may be accessed on Google under Jim Rogers. See discussion above on Rogers. The combination of Rogers and Maybury is my present foundation determining strategy.

4. Jim Sinclair. Probably one of the world’s best experts on Gold. Writes excellent editorials daily at www.jsmineset.com.  I've been faithfully reading his articles for years. His web site is only 5 or so years old. You will find that he writes every day, except when he makes occasional trips.  Even then, he often still writes.  He is one of several writers on the web site.  He has been a gold trader all his life, taught by his father, one of the greatest traders of all times. I believe he is probably one of the 4 or 5 best traders in the world. Money does not seem to affect him as it does most of us. He has an incredible knowledge of financial history. He's probably one of only a hand full of people who completely understand derivatives, warning more than ten years ago they would cause a financial calamity some day.  No one I am aware of has even approached his forecasting record on gold, as well as the whole financial picture.  He claims to have 150,000 readers.


Four Younger Men I Read Regularly
(on “probation” but could move into the top group)

1. Steve Sjuggerud. Writes True Wealth newsletter (monthly). Has only been writing three years, but has excellent record to date. Information at www.stansberryresearch.com. Has been very helpful to me.

2. Adam Hamilton. Writes Zeal Intelligence newsletter. Does some of the best technical work I have seen. Good writer. Serious Christian. A man of character and integrity from all I can discern. I like him. Information available at www.zealllc.com. 

3. Jason Hommel. Also a serious Christian, and has written quite a bit of Bible study material. Has done incredible research on gold and silver and paper money. Possibly becoming one of the world’s leading experts on silver. Writes Silver Stock Report, free at www.silverstockreport.com. Reading back issues, along with his many articles, is an education. He has been very helpful to me. He claims to have 80,000 subscribers.

Others Worth Reading
Be on the lookout for all the following names. You will find articles by some of them (free) at www.gold-eagle.com, and www.kitco.com. Some will show up at other places, but their work can also be found on Google.  I read them all when their material becomes available.

Important - The Bottom Line
WARNING: Beware of any newsletter with less than a ten year documented track record. Mark Hulbert, publisher of Hulbert Financial Digest, has been tracking the results of several hundred newsletters for at least the last 25 years that I know of, maybe longer. He has no relationship to any newsletter and uses the same calculations and formulas on all. You can check the record of any newsletter by going to his link on www.marketwatch.com. 

Also beware of any newsletter which quotes performance figures, but does not make specific buy and sell recommendations giving the date and price at which they could have been executed following publication of the recommendations, and continuously following every recommended investment until it is sold. Anything short of this is not a complete track record and can be misrepresented and dangerous. Such newsletters are notorious for citing some of their great calls, after the fact, while conveniently remaining silent about their not-so-great calls, and certainly not showing an overall portfolio result which includes all recommendations over a protracted period of time.

The objective of 99% of the newsletters is to sell newsletters, not make you rich. If they could make you rich, they’d be rich and wouldn’t need to sell newsletters. Admittedly, this is a generalization, and there are a few rare exceptions, but not many (see last paragraph below). Here’s a quote from Richard Russell worth thinking about.

CLOSING COMMENTS: Not all of you will want to do a lot of reading or study. Some of you will invest 100% in the Permanent Portfolio, and won’t need to. Some will find other investment advisors you trust. And some will do little or no investing at all because you are investing all your energy and resources in your own business or profession.

But some of you will be serious about wanting to learn how to invest. To you I say begin reading and studying Richard Maybury and Richard Russell. They are exceptions to the above comments, and the only two newsletters I can enthusiastically recommend at this time. They are worth every penny you spend on them, and more. Read their back issues for the last two or three years. Then read everything you can find spoken or written by Jim Rogers. He has a heart for helping the average investor (little guy). And above all, read his book Hot Commodities.