The Baby Boomer Survival Guide (Part I)
PARIS – What should you do if you are running out of time and money?
This is the question we get from readers over 50… over 60… and sometimes over 70.
We baby boomers were famously “na… na… na… live for today.” Now, it’s tomorrow. And many of us – often through no fault of our own – are having trouble making ends meet.
At the Diary, we write about the world of money. About economic policy and how it affects you.
But what if, in your world of money, you are running short? What should you do to get more?
Check under the seat cushions? Rob a bank?
We’ll come back to this question in a few moments. First, let’s take a look at the big picture…
The Yellow Machines Go Silent
It appears that the world economy is headed for recession.
An economy makes and takes. Whatever you make – whether it is an apartment building or a plastic toy – you have to begin by taking dirt out of the ground.
You need to dig a hole before you can put up a building… or even make a parking lot. And you need to scrape up raw materials – copper, iron, oil, etc. – before you can make anything at all.
This requires machines. Yellow machines. When economic activity goes down… so do sales of these machines.
Yellow machines move dirt. They are used in construction, mining, and every sort of resource industry. We’re talking about backhoes… tractors… forklifts… excavators… bulldozers… and loaders.
Ominously, demand for these machines – along with the stuff they move – is collapsing.
Two of the biggest suppliers are Caterpillar in the U.S. and JCB in Britain. Both report catastrophic drops in sales.
Caterpillar says its sales have fallen three years in a row. And it expects a fall of another 5% next year. This marks the first time in its 90-year history that sales have fallen four years straight.
The Illinois-based company – which gets 60% of its revenues by selling machines outside the U.S. – says it has had to lay off 31,000 people so far… with more job losses to come.
JCB says that it, too, is suffering a devastating fall in sales. Commenting on falls in demand of 70% in Russia, 47% in China, and 36% in Brazil, JCB’s CEO, Graeme Macdonald, said:
The yellow machines are at the beginning of the process, not the end.
You have to move dirt before you put up a factory. Or build a house. So, when the wheels stop turning on the yellow machines, it won’t be long before it shows up in falling GDP figures.
What Really Matters
Now, back to the question on the table: You are 70. You have no money. What do you do?
Sell your body for medical experiments? Invent a new app?
As we said last Wednesday, sophisticated trading systems and expensive investment programs are not a good idea if you fall into this category.
They are for people who have money already. If you have money, want more, and enjoy the thrill and challenge of financial adventure, they can be highly lucrative.
But what if you don’t have money already?
We don’t know anything more than anyone else on the subject. We don’t have any secrets. But after thinking about it, we have some ideas.
This is not advice. This is just what we would do if we were in that situation…
First, we would go back to philosophy – Democritus, Epicurus, Zeno, Seneca, Marcus Aurelius, and Lucretius (not to mention Jesus of Nazareth!).
They argued – albeit in different ways – that what matters in life has little to do with wealth or status. What matters (at least according to Plato’s description) are courage, wisdom, justice, and temperance.
We would add beauty and dignity. And a good wine. And a good cook. But nowhere on the list is a Rolex or a house in Malibu.
The nice thing about Plato’s list… as well as the whole Epicurean/Stoic/ascetic creed… is that it doesn’t cost much!
As many philosophers and religious teachers have said, wealth may get in the way of the things that matter. It may distract you and reduce your real happiness.
You may be better off without it…
A Better Philosophy
We are not ducking the question. We are just putting it in context.
If you want more money, you first have to understand what you want it for… and how it might affect your life.
Our goal is not to “come to terms” with financial misery. Nor is it to submit to poverty – even happily. Instead, we want to master poverty… to live better.
As Nietzsche put it, we aim to “set to dancing with arms and legs.” And for that we need context.
Tomorrow – a simpler, better philosophy… and how to use it to get more money!
Further Reading: One “financial blueprint” we highly recommend, regardless of where you are in your wealth-building journey, is colleague Chris Mayer’s new book, 100 Baggers: Stocks That Return 100-to-1 and How to Find Them.
Chris explains why some stocks go up – sometimes by 1,000% – and others go nowhere. He also shows you how to pinpoint those life-changing investment opportunities before they start their meteoric rise.
If you live in the U.S., we’d like to ship you a FREE hardbound copy of Chris’s book direct to your doorstep. It will undoubtedly be the most important, powerful, and useful book you read this year. Claim your free book here while supplies last.
It was a miserable week for biotech stocks.
Last Monday, presidential hopeful Hillary Clinton tweeted about price hikes in the market for specialty drugs.
Clinton was referring to the 5,000% price hike for Daraprim – a drug in use since the 1940s that can treat a life-threatening parasitic infection called toxoplasmosis.
And she promised to “take on” this kind of “price gouging.”
As you can see, the iShares Nasdaq Biotech ETF (NASDAQ:IBB) – which tracks a broad basket of biotech stocks – plummeted 13% for the week.
IBB is still up about 600% from its low in early 2009.
All Cancers Were Cured Back in 1925
The FDA has covered up five major blunders in the fight against cancer, diabetes, heart disease, and Alzheimer’s. But now you can use those missteps to get healthier than ever…
How to “Short” a Central Bank – Buy Gold
Gold is the only time-honored currency. It is neither a liability owed by a public institution nor a private party like a bond. This makes the yellow metal a great way to bet against central banks…
Volkswagen Scandal Will Speed Up Diesel’s Demise
The VW scandal is the result of Europe backing the wrong emissions-reducing technology – diesel engines. “Clean diesel” is a big lie. Expect more focus on hybrid engines in the future.
Are you a baby boomer struggling to make ends meet? Do you have a personal story you’d like to share with Bill and the team?
We’d love to hear it. Write to us at[email protected]
We got a lot of great feedback on Thursday’s Diary… comparing the Volkswagen emissions scandal with Fannie Mae’s role in the subprime mortgage collapse.
The most interesting thing to me about Bill’s compare/contrast of the situations at VW and Fannie is that the VW story is all over the news, but this was the first I heard about the Fannie Mae story.
I guess if you are a true crony, the mainstream media either ignores your misdeeds completely or buries the story in the back pages…
– Ranson G.
Your slant on the nearly $1 trillion fine against Volkswagen is right on target. It is not guilty of anything other than deception.
If deception is not legal, then why aren’t 99% of our congressional representatives already in jail?
– Vincent C.
I’m benefiting from the knowledge given by Mr. Bonner. I know in my heart that he is right and that extreme chaos is about to explode upon this nation.
There was a senator of Rome, 59 BCE, who accurately diagnosed why our nation is being destroyed today. His name was Cicero – a politician, philosopher, lawyer, political theorist, consul, and constitutionalist.
In his speech before the Counsel of the Senate he stated that a nation could survive everything except TRAITORS from within.
The TRAITOR slithers along the corridors of Congress spreading his venom behind closed doors during dark hours. The TRAITOR will rot the very soul of a nation. Hence, this is what we are witnessing today in our nation from the top levels of government.
– Royce D.
In Case You Missed It…
Last Friday, Bill sent an urgent warning from his childhood friend and controversial economist James Dale Davidson…