There's one thing you can almost always count on with the government: Coming late to the party.
The release of the U.S. Federal Reserve's minutes from the April 29 and 30 meeting of the Federal Open Market Committee (FOMC) included several "pronouncements," none of which you're hearing from the mainstream press and all of which we here at Money Morning told you were coming months ago.
Four things to think about:
Now here's what to do:
First, when the markets get sideways and uncertain, it's important to realize that having the proper portfolio structure will save the day - regardless of who's at the helm (big money) and who might think he's at the helm (Fed Chairman Ben S. Bernanke),
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And by "structure," we don't mean individual stocks or allocation. Instead, what you need is an assemblage of stocks concentrated on the trends of the time, such as energy and inflation, for example.
Traditional diversification, while better than nothing, is just a proxy for having no clue about how to select smart investments. It's like rearranging the deck chairs on the Titanic. It might look pretty, but it doesn't work when the entire market goes down at once, as so many investors found out between 2000 and 2002 and again recently.
Structure, on the other hand, is a deliberate attempt to manage risk. That's why famous investors like Berkshire Hathaway Inc. (BRK.A, BRK.B) Chairman Warren Buffett, George Soros, John Templeton and Jim Rogers concentrate their risks, rather than just spread their money around willy-nilly.
Second, pay particular attention to unstoppable global trends. Then place money squarely in front of where they meet. This is not rocket science. For instance, the world's electrical systems are antiquated or nonexistent, which means they need to be updated and simply built in the first place to meet demand. Which is why there's an estimated $16 trillion behind the trend.
Other "unstoppable trends" include the emergence of China, inflation, energy, and even war, which, in a sad testimony to our times, is a growth industry.
Third, think like a plumber. A little water in the wrong part of your house can do a lot of damage, so it's important not to let it get out of control in the first place. We're not referring to micromanaging a longer-term portfolio here, but unless you're a day trader or even a swing trader, there's no reason to be constantly tweaking your portfolio in search of smaller profits when it's the bigger picture that matters.
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About the Author
Keith is a seasoned market analyst and professional trader with more than 37 years of global experience. He is one of very few experts to correctly see both the dot.bomb crisis and the ongoing financial crisis coming ahead of time - and one of even fewer to help millions of investors around the world successfully navigate them both. Forbes hailed him as a "Market Visionary." He is a regular on FOX Business News and Yahoo! Finance, and his observations have been featured in Bloomberg, The Wall Street Journal, WIRED, and MarketWatch. Keith previously led The Money Map Report, Money Map's flagship newsletter, as Chief Investment Strategist, from 20007 to 2020. Keith holds a BS in management and finance from Skidmore College and an MS in international finance (with a focus on Japanese business science) from Chaminade University. He regularly travels the world in search of investment opportunities others don't yet see or understand.