Getting “Real” With Our Investment Strategies

[The Bleeding Edge]( Getting “Real” With Our Investment Strategies By Jeff Brown, Editor, The Bleeding Edge [As I shared on Monday]( I’m devoting this week of The Bleeding Edge to an exploration of new investment strategies that will help subscribers weather these volatile markets. The first half of this year has not gone as I expected. I did predict that many technology companies that were clearly overvalued would fall hard… And they did exactly that. But I believed that the high-quality growth companies that were trading at reasonable valuations would weather the current market volatility… I forecasted that the Fed’s aggressive talk would soften into the spring to a series of smaller rate hikes that wouldn't hurt the markets… And I felt that the Fed wouldn’t take actions that would crush the equity markets, our retirement accounts, and the housing market; especially considering the upcoming mid-term elections. I was wrong. I didn’t foresee the speed and viciousness of the current sell-off. And I didn’t anticipate that it would drag down virtually all growth companies to multi-year lows. I know readers are hurting right now. When we look at our portfolios and see a sea of red, it can feel like all hope is lost. I can’t think of a time in my entire life when I was more concerned about the world that we’re living in. We’ve been through hell the last two years. We’re witnessing the worst monetary, fiscal, and economic environment I’ve ever seen in my lifetime, and inflation that I thought I would never see. These things all weigh heavily on me every day. I’m sure they weigh heavily on our readers. Growth and technological advancement will return to us. And with it will come a recovery of our investment portfolios. I can’t guarantee it will happen immediately… But I know it will happen. But until we return to healthier market conditions and get out of the briar patch, our usual strategy of investing in growth companies will not serve us well. For now, we’ll need to make adjustments and play the cards that we’ve been dealt. A strategy I’d like to share with subscribers is something I had incredible success with nearly 20 years ago. And I believe we can replicate this strategy for ourselves in 2022… Recommended Link [Americans have had enough of these gas prices.]( Afraid for their jobs… Washington is federally mandating 500,000 newer, more efficient pumps. One tiny company is leading the charge with 9 government contracts and counting. [DETAILS HERE.]( -- A Technologist Invests in Commodities I’ve devoted my entire life to studying, working with, and investing in high technology. So, it might come as a surprise that immediately after the dot-com bust, I became an avid commodities investor. I bought physical gold and silver with the intention of holding them for an extended period of time. I also spent hundreds of hours studying the mining and exploration industry, and I invested extensively in private placements of junior exploration companies. And it wasn’t just precious metals. I invested in other industrial metals like palladium, platinum, and copper. I also did a lot of trading in the energy complex, like crude oil, natural gas, and even heating oil. [Trading Millionaire Reveals, “2008 Was My Most Profitable Year”...]( One of my favorite areas to invest was in agricultural commodities: Corn, cattle, soybeans, lean hogs, wheat, and even a few contracts in cocoa and orange juice. But my past success as a commodities investor doesn’t matter today. What matters is replicating this success for subscribers in 2022. I believe we can… but not surprisingly, things are a bit different today than they were 20 years ago, so our approach will be adjusted to meet today’s environment. Recommended Link [Millionaire Trader Makes Stunning Warning to 263 Million Americans…]( [image]( This is a defining moment in America… We’ll see a new class of millionaires rise as a new class of middle America falls to poverty. CNBC reports 263 million people alone could be pushed into extreme poverty in 2022. But millionaire Jeff Clark says “I’ll be fine – as well as the 170,000 folks I’ve helped discover a trading secret that could cash out big returns in ANY market. Because I simply ignore all 6,000 stocks in the market…” Recommending gains of 100%, 373%, and [390% gains in just 8 days]( in bullish AND bearish conditions. Today, Jeff reveals this trading breakthrough, 100% free. A secret used to recommend [triple-digit gains over 48 times]( and double-digit gains over 81 different times. [Click Here to Watch.]( -- Why I Expect Gold to Underperform Things were simpler in the world of commodities trading in 2000. There was a clear policy in place after the dot-com bust. By late 2000, the Fed Funds rate was set at 6.5%... And the government set out on a slow and consistent policy to lower the rates to re-stimulate the economy. Knowing all of this is what made investing in commodities so attractive at the time. With a consistent policy in place to reduce interest rates, it was easy to understand that the U.S. dollar would decline in value relative to other currencies. And that meant that commodities, priced in U.S. dollars, would increase in price. The easiest way to understand the impact of this policy is for us to look at a chart of the U.S. dollar index (DXY): We clearly see a consistent decline in the dollar from mid-2001 all the way through to the end of 2004. 2005 was an exception, but then the slide continued through to the global financial crisis in 2008. That window between 2001 and 2004 was a fantastic time to be a commodities investor. And investors who understood the supply/demand dynamics for any given currency could determine which commodities to invest in at any given time. [Expert warns: “Brace Now or Be Blindsided”]( As the dollar strengthened in 2005, that tailwind became a headwind. And I largely stepped aside from commodities investing. The difference between the early 2000s and today is that the dollar is not weakening, it’s getting stronger. Rising interest rates directly impact the value of the dollar as compared to other currencies. The dollar – as measured by the U.S. Dollar Index – is at a 10-year high. All else equal, a stronger dollar means weaker gold. And if the Federal Reserve gets really aggressive and raises the Fed Funds rate to 5% or even 8%, gold will fall significantly. For any of my readers who are gold bugs, I know what you’re thinking… It feels great to hold gold in our hands. It’s safe, enduring, and out of the hands of the government. However, it might come as a surprise that gold has not performed as well as we might have expected. It is down 14% since March and about 3.5% year to date. Of course, that’s significantly better than what we’ve seen in equity markets. But it’s not what we likely expected given that inflation is at 40-year highs. With all that said, there’s nothing wrong with owning precious metals “just in case,” as long as the time horizon is long (years or more than a decade). But it’s not the best investment strategy I’d like to share today… Recommended Link [Jeff Bezos' "Unfair" Playbook Could 49X Your Money]( [image]( Has Jeff Bezos rigged the game? Six mysterious deals have handed him up to $2.5 billion in pure profit... Even Amazon's own executives call these deals "unfair"... Because, every single time, Bezos FORCED his investments to soar. Right now he's getting in position for Deal #7... And for the FIRST TIME ever, regular folks have a chance to ride his coattails. Dave Forest discovered a unique "backdoor" way to jump into Bezos' next big deal... And potentially see a 49X return over the next 12 months. You do not want to miss out on this historic opportunity! [Click here for the full story.]( -- Invest in Real Assets to Beat Inflation One of the best strategies we can deploy now is to have exposure to key commodities. And we won’t need futures options or futures contracts that require daily attention. There are plenty of publicly traded companies and funds that can provide normal investors exposure to underlying commodities. The reality is that we’re in a very different environment than we were back in the 2000s. For starters, we have the geopolitical conflict between Russia and Ukraine. This has largely backfired on the E.U., as energy prices have soared. Russia found new buyers for its oil and natural gas in India and China, and the ruble is stronger than ever. All of this geopolitical conflict is obviously having a direct negative impact on commodities supply chains. Weak currencies and inflation, combined with supply chain problems, result in higher commodities prices. While all commodities are being impacted, energy and agriculture are my top two areas to gain exposure to. Oil, natural gas, and heating oil are all being impacted – not just by the conflict with Russia, but also bad economic policy. The U.S. went from being a net petroleum exporter in 2020 to a net petroleum importer this year. And that means higher prices. Just this month, I recommended a best-in-class oilfield service (OFS) company to readers of The Near Future Report. (Paid-up readers [can find that here]( From my perspective, it is an inevitability that domestic supply will increase to offset the declines in production in 2021 and 2022. And with the invasion of Ukraine, I predict, sadly, that the world is on the verge of serious food shortages. In developing countries especially, we could be looking at a literal famine in late 2022. That’s because Ukraine and Russia together supply roughly one-quarter of the world’s wheat. All of this tells us the prices for agricultural products are about to go higher… perhaps much higher. While these conditions persist, my team and I will continue to analyze and research companies that have exposure to these trends. 2022 has not gone as I had hoped or expected. Times like these are humbling. But these are the cards that we have been dealt, and we’ll need to play them as best we can. My commitment has always been to my readers, through thick and thin. And pivoting to companies – and potentially funds – that have leverage to these trends is a way to build diversity into our portfolios as we weather the volatility together. Regards, Jeff Brown Editor, The Bleeding Edge P.S. Do readers have questions about commodities in the current environment? If so, please write in to feedback@brownstoneresearch.com. --------------------------------------------------------------- Like what you’re reading? Send your thoughts to feedback@brownstoneresearch.com. --------------------------------------------------------------- IN CASE YOU MISSED IT… [If the talking heads in the mainstream media have you seeing ghosts of 2008...]( You’ll want to pay close attention... A former Wall Street managing director who walked away from a million-dollar career, Nomi Prins is now a prolific author and one of the world’s most respected Investigative Journalists. You might recognize her from appearances on Fox Business... CNBC... Bloomberg... PBS... or CSPAN... She’s exposing a bombshell story about a strange phenomenon in our financial system... A $150 trillion transfer of wealth she calls "The Great Distortion", could soon trigger a historic windfall for some Americans... 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