Six Unstoppable Trends About to Make You Rich
In a world where the major economies have been crippled by debt, central banking madness reigns supreme, and ISIS and other terror groups threaten to wreck whole nations, more and more people ask me what I consider to be the closest thing to a safe investment.
They usually expect me to talk about bonds, or gold, or mutual funds. Instead, I give a two-word answer – Unstoppable Trends.
Almost nothing is ever guaranteed in investing – but the six forces I’m about to show you never lose their power to drive and transform society while moving markets in the process. That’s why companies that tap into them always succeed in the long term and dramatically outperform the markets, no matter what else is going on.
And the Trends are permanent. They’re so deeply ingrained in human nature, or so necessary to maintain civilization itself, that nothing – not war, plague, global financial collapse, or the era of trillions of dollars of destabilizing stimulus we live in – could undermine them, much less eliminate them completely.
When I first came across them 11 years ago, the power that these Trends would exert on markets felt like speculation. But today, no one has to take my word for it.
That’s because the Unstoppable Trends have formed the bedrock of my investing philosophy since I came across them – and they’re reflected in my track record of recommendations to my Total Wealth and Money
Map Report subscribers that has allowed readers who followed along to dramatically outperform markets while cutting the risk in their portfolio down to the bone.
In fact, I’m about to give you examples of how my readers in the Money Map Report community and elsewhere have been able to exploit these Trends to yield returns that are two, five, or even 10 times greater than the returns of the markets.
Here are the Six Unstoppable Trends that can make you rich.
Unstoppable Trend #1: Energy
Energy isn’t a new Trend, and most investors have tried to tap into it in their investing lifetimes, sometimes successfully. But just as often, investors post losses after going into the sector because they don’t know how to play it, especially with oil prices having been slammed over the last 13 months.
This Trend taps into the lifeblood of developed economies everywhere, with the U.S. consuming more than 19.63 million barrels of petroleum products per day in 2016, according to the Energy Information Administration (EIA). That’s up from the 18.9 million barrels per day consumed in 2013, even as 540,000 new electric cars were on American roads by the end of last year.
If you want more proof that the demand for oil isn’t going away, look at the U.S. Navy’s actions in the Strait of Hormuz. Back in 2013, responding to rumors of harassment targeting oil tankers, U.S. forces deployed the USS Farragut, a guided-missile destroyer, and three coastal patrol craft – the Firebolt, the Thunderbolt, and the Typhoon – to complement convoys already there to give extra reassurance that the strait from which 20% of the world’s oil supply flows will stay open. Those warships are still there as relations remain tense between Tehran and Washington. And keep in mind, this seriousness towards guarding America’s access to foreign oil comes after a fracking revolution here at home and breakthroughs that are making alternate energy sources cheaper and more widespread than ever.
Energy is an Unstoppable Trend because the most powerful nations on Earth will throw all the influence it takes – be it armies, scientists, or state-of-the-art technologies – to ensure that their economies have the fuel to keep moving. And this guarantee means that anyone who invests in a solid energy company that taps into this Trend will stand to make enormous profits – especially if the company is cheaply priced.
And that’s very exciting, because right now, after oil prices plunged in late 2014, virtually every major energy company is priced at a steep discount.
As a result of this short-term movement, analysts almost universally hate the energy sector. To their way of thinking, a whole host of international events are conspiring to further drag down a sector that’s already down and out.
But it’s showing every sign of approaching the point of “maximum pessimism” – and that should quicken your pulse as an investor.
To be sure, oil prices are still about 60% lower than their highs of two years ago, but if North America’s recovery continues its steady pace, growing demand for oil could light a spark under prices.
Make no mistake: Oil demand isn’t just here to stay, it’s growing. And that means that some battered energy companies that have been written off by the media stand to see immense gains as the growth behind this Unstoppable Trend reasserts itself.
We already exploited this dynamic to great effect in the Money
Map Report, where my Energy recommendation Williams Co. Inc. (NYSE:WMB) outperformed the markets by a factor of almost seven by the time we removed it from the portfolio.
As you can see below, this Master Limited Partnership (MLP) that refines and transports oil returned 29.95%, including dividends, in just under six months for Money Map Report members who followed along with my recommendation. Compared to broader markets over the same time frame, it outperformed the Dow by almost 7-to-1 – not bad for a company coming from a sector that was supposedly finished.
Part of what made WMB such a compelling buy at the time was its status as an MLP, meaning that it collects fees for transporting oil regardless of the price fluctuations that were hurting other energy companies. As oil prices slowly climb higher, I expect MLPs to be one of the shrewdest energy plays available, and we’ll be exploring plenty of profit opportunities like Williams as we progress towards Total Wealth together.
Unstoppable Trend #2: Demographics
In the year 1900, when the Dow was about to take off on a 22,000% run for the upcoming century, the world’s population stood at just over 1.5 billion people, according to DSS Research.
Today there are more than seven billion humans on this earth. In addition to being larger than it’s ever been, the population is also older. For the first time in history, the number of people aged 65 and older will outnumber children younger than five worldwide by 2020, according to a report by the National Institute of Health & Aging. One out of every five Americans – approximately 72 million people – will be 65 years or older by 2030, roughly double the number in 2000.
It’s already been well-documented how demographics can make or break economies. The growth rate of gross domestic product (GDP) is basically calculated by multiplying population growth by the growth rate of GDP per capita. Naturally as a population ages, millions of its citizens enter retirement and its workforce becomes smaller and produces less – except for cases where fertility rates are enough to replace the outgoing workers.
In Japan, the future is already here. Its aging population has already had huge economic consequences ranging from diminished productivity to soaring healthcare costs. Though it’s extremely wealthy as a nation – its Kanto region around Tokyo boasts a GDP the size of Brazil’s – its growth has been stagnant over the last 20 years, while America’s GDP has tripled. But being on the wrong side of the Demographics Trend is afflicting many other nations, including, increasingly, the U.S.
In the United States, 10,000 baby boomers retire each day, while France is the only major European nation with a fertility rate that’s above replacement levels. This means Europe’s continuing to get older, with the Brookings Institution forecasting that the median age in Europe will soar 37% by 2050, from 38 (in 2003) to 52.3 years.
Incredibly, that means that half of Europe’s population will either be at retirement age or just a few years away from it in barely a generation.
The aging taking place on a global scale will mean surging profits for medical companies like Becton, Dickinson & Co. (NYSE:BDX).
This company manufactures and sells medical supplies and devices through its three segments: BD Diagnostics, BD Medical, and BD Biosciences. It makes products for healthcare institutions, life science researchers, pharmaceutical industries, and the general public. Many of its products are single-use, meaning that there’s continuing robust demand for them.
I recommended BDX to Money Map Report subscribers in August 2014, and we exited in September 2015 for double-digit profits, as you can see below. Once again, it was a dramatic outperformance of the broader indices, which were both negative over the same time frame.
As Demographics continue to transform national economies through their workforces, trillions of dollars in capital will be shifted every year to companies like BDX. We’ll be exploring more profit opportunities to play this Trend that’s accelerating before our eyes – and as always, my subscribers will be the first to know.
Unstoppable Trend #3: Technology
Technology can transform markets. Simply put, the Technology Trend is how new information, medical treatments, scientific innovations, and progress in society revolutionize products, and therefore, businesses and ultimately economies. Technology’s influence can be seen in virtually every company on the planet – whether it’s helped it or diminished it, ruined it or made it a leader in the industry.
For example, Apple stock closed at $16.30 per share on June 29, 2007, the day of the iPhone launch. On October 5, 2015, it closed at $110.72, a 579% gain. Tesla is up 825% since August 2012, when the company announced the construction of an advanced network of “supercharging” stations for its new Model S cars. Other times, the Technology Trend creates new markets rather than transforming existing ones. The cloud computing market, which traces its origins to 1999, is forecast to total $236 billion by 2020, according to Forrester. That’s up 2,400% from the $5 billion market that existed in 2008, and it’s been a bonanza for industry leaders, like Amazon with 30% market share (up 610% since 2008) or even Salesforce.com Inc., which commands just 4% market share but is still up more than 1,600% since its IPO in 2004.
3D printing is another example of a new market brought on by Technology. The 3D printing industry is projected to grow from $1.1 billion in 2009 to $6.2 billion in 2019 – and companies that have harnessed this part of the Technology Trend have thrived accordingly. 3D Systems Corporation is up 453% since 2009, outperforming the Dow by more than two-to-one, for example.
Most people are aware of how technology powers some new businesses and ruins others. But most investors don’t understand how to play this Trend because they’re all too often chasing the existing markets, rather than the markets that will be on the rise tomorrow.
The fact is, many mature technology companies offer a blue chip combination of growth and safety. Their year-over-year growth may have moderated from their heady early days, but they still offer market-beating gains with less risk than their smaller cap brethren.
As such, they’re today’s version of the “Nifty Fifty” stocks that our fathers advised us to buy and hold – the 50 most popular large and mid-cap companies that seemed infallible over the long term during the 1960s and 1970s – the last gasp of the “buy and hold” era.
Unstoppable Trend #4: Medicine
There’s an old saying on Wall Street: Don’t bet against the consumer. A similar axiom seems to apply these days: Don’t bet against the mammoth healthcare sector.
Healthcare spending in the United States is expected to jump 5.8% between 2015 and 2025, far outpacing GDP growth for the same period, and totaling more than $10,345 per person each year. According to the institute for Health Metrics and Evaluation, global spending on health is expectec to reach $18.3 trillion worldwide by 2040.
The resulting movement in capital will place huge amounts of stress on governments, social security systems, and insurers and developing markets. In the U.S. alone, for example, spending on Medicare is expected to swell from $500 billion in 2012 to $900 billion by 2022, according to the Congressional Budget Office.
But that won’t be the only area we’ll be exploring in Medicine. From the IT-enabled health care market, which is expected to more than double from 2013’s $96.87 billion to $210.23 billion by 2020 according to the research firm Transparency Market Research, to the digital health funding that’s already nearly doubled from 2013’s levels, there are plenty of sectors where tens of millions of consumers are demanding progress. And some of the breakthroughs are coming in the most unlikely places.
For example, it didn’t escape our notice at Money Map Report that the medical aesthetics market (read: plastic surgery) is forecast to total more than $12 billion by 2020, up more than 50% from today’s levels. Our way to play the sub trend in the Medicine sector was through Kythera Biopharmaceuticals Inc. (NasdaqGS:KYTH), a biotech that had just developed a fat-melting drug that we foresaw millions of customers would be clamoring for.
Just five months after our recommendation, KYTH was up 47%, a performance that’s all the more impressive during a period of heavy market turmoil in which the indices lost 10% of their market capitalizations.
Whether it’s fat-melting treatments or life-saving drugs, there are immense profits looming from emerging medical technologies, and you’ll be first in line to hear about any and all developments that I believe are worthy of your investment.
Unstoppable Trend #5: War, Terrorism
This is the Trend that my readers tend to be least likely to invest in, for obvious reasons. I can’t say I blame them. It’s my least favorite Trend too, both personally and professionally.
But War, Terrorism, & Ugliness isn’t going away. The Trend encompasses the worst aspects of humanity’s trajectory – armed conflict, terrorism, cybercrime, and espionage, as well as increasingly sophisticated international threats like biological warfare and politically destabilizing forces like ISIS. With cybercrime on the rise – costing the global economy a projected $2.1 trillion by 2019 – and with ISIS on the march while Putin flexes his military muscle in the Middle East, it’s sadly clear that this Trend is picking up speed at least as quickly as the other five.
As investors, we can’t afford to ignore the terrible reality that the world isn’t getting safer. Instead, it’s better to acknowledge the power that War, Terrorism & Ugliness has to shape markets.
A little-known reality of this Trend is the fact that you can turn your capital towards causes that actively work to roll back these threats. For example, if you want to put your money to work fighting the rise of cybercrime globally, consider the exchange-traded fund PureFunds ISE Cyber Security ETF (NYSEArca:HACK), which has holdings in 32 of the best and brightest companies working to roll back cyberattacks that increasingly threaten to destabilize or destroy businesses, governments, and livelihoods.
If you want to direct your capital in a way that acknowledges the international dangers that run amok and helps to combat them, consider Raytheon Co. (NYSE:RTN). In fact, I’ll have a report on this stellar defense contractor hitting your inbox in just a matter of days.
I particularly like Raytheon as a play on the UAV bonanza because it specializes in UAV sensors, which command a higher premium than the manufacture of UAV bodies.
You see, UAVs are always willing to die for their country. They’re the darlings of Pentagon war planners, who embrace UAVs as the ultimate weapon. These pilotless drones project military power without “boots on the ground” and they epitomize leading-edge technology in a military that’s still evolving away from the legacy weapons of the Cold War.
Somewhat counterintuitively, there are prosocial and even humanist ways to play this Unstoppable Trend. And as you can see, the profits at stake are too powerful to ignore.
Unstoppable Trend #6: Scarcity & Allocation
Scarcity & Allocation is the Trend that’s front and center when it comes to global resources becoming more strained than ever before. By 2025, 1.8 billion people will suffer from extreme water scarcity, according to FEWResources.org, while scientists predict that food shortages will become as politically destabilizing as energy shortages are today by mid-century as the world’s population approaches 9 billion.
In 2014, NASA scientists viewed data from gravity-sensing Grace satellites with a growing sense of dread, as the images depicted foretold an epic drought in California and seventeen other densely populated areas in the world, most of them in regions that are already politically unstable. The picture was so stark that the U.S. Director of National Intelligence warned that water shortages around the world would inevitably threaten America’s national security.
The arithmetic is undeniable: Scarcity & Allocation will only become a more potent force over the next few decades, as the world’s population booms amid finite resources – most notably food and water.
All of this will mean monumental growth for companies that can address these shortages – desalination companies that can add millions of gallons a day to local water supplies, or agricultural companies that improve soil fertility and enhance crops worldwide, to name a few.
The World Bank, for example, estimates that every year, 24 billion tons of fertile soil are lost due to land erosion, while 12 million hectares (29.6 million acres) of fertile land are lost due to drought. This pattern will make companies like CNH Industrial N.V. that deal in agriculture and improved farming methods more in-demand and even more prosperous than they are already. The company has already returned more than 90% since I brought it to my subscribers’ attention.
But there’s another opportunity almost no one mentions. People don’t realize it, but money is a resource, too. This trend is powered not just by the lack of precious commodities, but also by the allocation of resources including money itself. Consequently, it’s a perfect way to play central bank antics that have already shifted tends of trillions of capital over the years in America, the European Union, and Japan.
Central banking lunacy in many major economies has had the effect of undermining currency, making it less reliable in the long term and bringing about stunning shorting opportunities for currencies on the decline. That’s why exchange-traded funds that gain on the declines of stimulus-ravaged currencies have such potential.
A simple way to play this Trend is one I’ve already detailed. In September 2011, I pointed out that Japan’s demographic nightmare had a side effect almost no one was acting on – the aging population strained the economy by slashing the revenue-generating workforce, burdening the welfare system, and ultimately driving down the yen. The best way to play this, I opined, was with the exchange traded fund that essentially shorts the yen, ProShares UltraShort Yen (NYSEArca:YCS).
Since I made the prediction, YCS has more than doubled, to the benefit of readers who followed along (chart on text page).
Although this Trend tends to be the least understood, profit opportunities abound from it. And with Earth’s population booming amid finite resources, this Trend will only become more relevant.
As you can see from all these examples, the potential to consistently capture returns that exceed those of the markets is there. And in this troubled economic era of rampant central banking madness, runaway debt, and political instability and brinksmanship in Washington, these Trends aren’t going anywhere.
In our time together, we’ll explore each one extensively. You have my word as Chief Investment Strategist that we won’t leave any avenue for profit unexplored even when – especially when – other investors who aren’t tied into our Trends are spooked by headlines.
I’m glad you’re here!
Best regards for great investing,