In Search of a “Wandering” $1.5 Trillion
- $1.5 trillion looking for a place to invest… and how you can get there first
- G-20 tomorrow: Here’s what matters just as much as Trump-Putin
- An investment strategy immune to hackers
- Big 5 drag down rest of the market… strangers splitting a home purchase… gold doomed for 13 more years?… and more!
There’s a $1.5 trillion pool of money sloshing around the country, just looking for a good place to go.
So says a report from the consulting firm Bain & Co.
That $1.5 trillion is the amount of “dry powder” accumulated by firms that specialize in buyouts. And those firms are eager to put that money to work doing deals.
Typically, a figure like this would mean nothing to you as a retail investor. But what if you could collect a generous cut from those deals?
Leon Black is ready to do deals. A lot of them.
Black, a specialist in leveraged buyouts and private equity, founded the $197 billion-strong Apollo Global Management in 1990. He’s just raised $23.5 billion for the world’s biggest buyout fund.
“The record-breaking fundraising,” The Wall Street Journal reported last week, “is the latest demonstration of a surge in investor appetite for leveraged buyout funds, extending a run of records in recent months.”
That $23.5 billion eclipses the previous record set by Blackstone Capital Partners a decade ago.
The big-bucks investors who just stumped up $23.5 billion to Leon Black stand to make out very well.
“Over the past five years,” says the Journal story, “buyout shops have delivered an average net internal rate of return of 15.84%, according to data provider Preqin Ltd. Buyout firms have failed to deliver double-digit returns in just two years since 2000, including 2008 and 2011.”
But there’s another class of investor who makes out far, far better from these deals. And you don’t need millions of dollars to be among them.
All you need is to follow a technique that identifies the right takeover targets at the right time.
Sounds impossible, right? Not unless you’ve got the proverbial “inside information” that would quickly bring you under a prosecutor’s spotlight… and maybe even some time in “Club Fed.”
But our Louis Basenese recently wrapped up a six-year project — perfecting a system to pin down takeover targets with startling precision. And by “startling”, we mean it works 100% of the time… delivering up to 10 times your money within 24 hours. Simply by buying the right stock — not options or anything tricky.
Nice odds, right? And Louis says the next opportunity is only 19 days away — Tuesday, July 25.
Of course, extraordinary claims require extraordinary evidence. We encourage you to click here and review the evidence for yourself. There’s no “long-winded” video to watch.
The “Big 5” stocks are dragging down the rest of the market on this Thursday.
Apple, Alphabet, Microsoft, Amazon and Facebook are all in the red. Thus the S&P 500 is off nearly two-thirds of a percent as we write, at 2,417.
But the hot money fleeing stocks isn’t going into bonds or gold. The 10-year Treasury yield sits at 2.39%. Gold remains mired at $1,223.
Oil traders like the weekly inventory numbers from the Energy Department; West Texas Intermediate is up nearly 3% at $46.44. Otherwise, there are no earth-shaking economic figures; tomorrow brings the monthly job numbers from the Labor Department. We can hardly contain our excitement.
While all eyes will be on the first Trump-Putin encounter tomorrow at the G-20 meetings in Germany, Chinese President Xi Jinping will be quietly maneuvering behind the scenes.
Xi will be meeting with Putin and the leaders of the other BRICS countries — Brazil, India and South Africa. “The BRICS as a group continue to be interested in ways to bypass the U.S. dollar in global payments systems,” writes Jim Rickards in the latest issue of Rickards’ Strategic Intelligence. “By strengthening and expanding nondollar payments systems, the BRICS make themselves less vulnerable to U.S. economic sanctions, which mainly operate through bank channels and dollar accounts.”
With that in mind, Xi dropped in on Moscow two days ago on his way to the summit. He and Putin cut a deal under which Beijing will extend $11 billion in funding to two Russian investment groups. The deal will be done in yuan, not dollars — thus it sidesteps U.S. sanctions on Russia.
China also stands to be the beneficiary of a more independent Europe, says Jim.
“Merkel recognizes that Europe is increasingly on its own and needs to purse a destiny independent of the U.S. and Russia,” Jim tells us. “Macron has publicly voiced the same view.
“The likely beneficiary of this new European outlook will be China. With Russia still subject to sanctions, and the U.S. in a more confrontational mode, China will be met with open arms by the new Europe. China is looking to diversify its reserve position away from dollars toward euros.
“China is ready to take the plunge with portfolio investment in European debt and direct foreign investment in ports, airports, highway systems and other critical infrastructure as well as large stakes in key European companies.”
Behold, an investment strategy immune to the whims of hackers.
Last month we told you much about the revolutionary “K-Sign” breakthrough developed by our Jonas Elmerraji — with the help of a powerful computer system housed in northern Virginia he calls “Archimedes.”
Then came the latest global cyberattack last week — a ransomware bug called Petya that gummed up the works for dozens of companies around the world, like the shipping giant Maersk.
New subscribers to Kinetic Profits were relieved to learn Archimedes is immune to such attacks — because it doesn’t operate on Windows.
But Petya did attack one of the companies where Jonas had spotted a K-Sign only days earlier… and the share price took a hit.
Jonas urged his readers not to worry. The K-Signs indicate when to buy and when to sell. “We’re not too worried with what happens in between those windows,” he explained.
“From a statistical perspective, all the price action in between our buy and sell dates is just noise. We can safely expect some occasional dips and sideways chop during our windows, but the stats prove that we’re much more likely to walk away winners on any given K-Sign trade.
“And just in case things really do go off the rails, we set pre-defined stop-loss levels from the get-go on every trade.”
Hopefully you find that reassuring. Especially if you followed our K-Sign guidance here in The 5 and bought gold on Friday, June 23. Yes, gold has shed about $30 since then. But all that matters is whether gold will be in the green by the time the “Kinetic window” closes on Sept. 22 — dates selected not by Jonas but by the Archimedes system.
Kinetic Profits is still available to new subscribers at the charter subscriber rate. And there’s no better time to join than now. Tomorrow Jonas will lead a members-only conference call answering readers’ most burning questions about the system. Follow this link to learn more.
Oh this will end well: Finding a stranger with whom to buy a house in Toronto — because that’s the only way you can afford a house in Toronto.
With the average selling price in the Greater Toronto Area now $863,910 — up 15% in just the last year — a firm called GoCo Solutions has come up with a “speed dating” arrangement not to find true love but to find a suitable co-owner for a home. “It helps people increase their net worth, and it’s not just about a landlord making money off of your rent,” says GoCo founder Lesli Gaynor.
The Canadian Press article about the trend tells the story of Karen Turner and Kelly Wilk — two women in their late 30s who’ve known each other since college days. “Wilk’s son will be able to play with Turner’s dog. When she needs a break from child rearing, she can send him to spend time with Turner, who also wants to have kids eventually. Wilk likes knowing that there will be someone around to help.”
And what happens, we wonder, when only one buyer is ready to move on to the next phase in life and wants to sell?
Thing is, co-ownership as a workaround for expensive Toronto real estate has a years-long history already.
My wife and I recall one of the more notorious Toronto-based episodes of the HGTV series Property Virgins featured “Lindsay, Jason and Wes”… in early 2009.
It’s described on Wikipedia as follows: “With their growing family, Lindsay and Jason have outgrown their one-bedroom rental. But since they can’t afford to buy a home on their own, they’re partnering with their longtime bachelor friend, Wes. They all get along famously, but their lifestyles are different, and that can make buying a home together very stressful.”
If memory serves, Wes ended up with living quarters in the basement even though he was stumping up most of the down payment. Heh…
Near as I can tell, this episode was not deemed worthy of a “where are they now” follow-up. Presumably because it ended in acrimony?
“The fact that gold is entrenched in a 20-year bear market is known by only a relatively few long-term gold market observers,” a reader wishes to opine.
“I read a newsletter writer’s detailed analysis complete with graphs and charts and other supporting data many years ago. I don’t remember the author’s name but his work was well done and has stood the test of time since the mid-’80s, when I read it.
“The data went back about 200 years, virtually covering all historical gold prices. It showed that gold has been, is presently and always will be following a 30-year cycle, 10-year bull markets followed by 20-year bear markets. His premise was that gold will ‘find a reason’ to follow this cycle no matter what that reason may be — such as supply and demand, manipulation by central bankers, etc.
“Within the 20-year bear there is and will be bear market rallies. And yes, gold may in fact go up all the way to test its old all-time high, but it will not break that high until the next bull market is in force.
“Everyone agrees, correctly, that the last bull market occurred from 2001–2011. According to the 30-year cycle theory a new all-time high will not occur in gold until about 2035. How so? The 20-year bear will last until 2031, plus or minus one year, and then the bull will exist for three, four or five years before a new all-time high is achieved.
“Another sign that gold is not in a bull market is that so many so-called experts are saying it is — just by contrarian theory alone this points to the opposite. Also, for those experts (Mr. Rickards included) who are calling for gold to soon soar to unheard-of heights — not happening, sorry — gold’s natural cycle excludes this possibility. Even in the next bull it is doubtful gold will exceed a triple of its present all-time high.”
The 5: Interesting.
Without examining the work up close, a couple of thoughts occur to us. For Americans, there wouldn’t have been much of a cycle to care about from 1933–1971, because it was illegal to possess gold and gold was fixed at $35 an ounce.
Assuming this 10-year-bull/20-year-bear pattern goes back 200 years, it doesn’t seem to account for the 1930s, which in theory should have been a bearish period. But FDR revalued gold from $20.67 to $35, and even though gold ownership was illegal, gold mining stocks like Homestake and Dome Mines delivered stunning gains.
In any event, cycles are a funny thing: Bert Dohmen, one of the lions of the newsletter biz, has done cycles work on gold going back 500 years. He says gold has 20-year down phases and 30-year up phases… and we’re still in the middle of a 30-year up phase that began in 2001.
Guess we’ll find out whose cycle work is right in another 15 or so years…
The 5 Min. Forecast
P.S. Louis Basenese calls it perhaps the most powerful force in all of the stock market — sending specific stocks straight up on exact dates.
And he’s just spied this force at work… ready to send one stock shooting higher in less than three weeks. Details here.