Forget Investing, Let’s Spend

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With so many strange goings on in the investment world lately, it’s not surprising there’s a bit of confusion around the office. Specifically, Diggers and Drillers editor Alex Cowie and Sound Money Sound Investments editor Greg Canavan are lost. Lost in time that is. Going by the subject lines of their recent emails to subscribers, one reckons we’re in 2007 and the other in 2008.

Reading their actual emails explains the subject lines. Greg reckons there’s a second subprime bust coming. Not in Australia, but somewhere even more important for Australia. Alex is pointing to what happened to gold stocks in 2008. He’s as bullish as ever.

But what if you’re tired of investing? There’s more to your wealth than placing bets. Let’s talk about spending instead. Right now there are dozens of ways you can spend money in a way that benefits your life far more that investing ever will.

For example, you could spend money to reduce your living expenses in the long run. Or you could spend money on everyday items that actually increase in value even as you enjoy using them. Why not generate some cash by ‘downgrading’ parts of your life you don’t really want or value anymore?

The investment world doesn’t make much sense these days anyway. Stock markets are rallying without improvements in the economy. Gold prices were smashed and then staged a recovery even though nothing much changed. Central banks are printing money like madmen and governments are spending and cutting back like loonies.

In the midst of all this, investing is more difficult and dangerous than usual. In The Money for Life Letter we try to make sense of what’s going on. There are some investment strategies that defy even this environment. But there’s a fundamental change happening in the investment world you need to be aware of. It’s a ‘trend’ we missed when launching the newsletter last year.

In case you missed the original video, we explained there are three new trends which have changed the investment landscape fundamentally. Well, there are four now, but we’ll get back to the fourth in a moment. The original three are as follows: The Income Trend replaced the Growth Trend. The Safety Trend replaced the Risk Trend. And the Rip Off Trend needed to be dealt with. Three special reports provided ways of benefitting from these trends.

But now another trend has emerged. We haven’t thought of a name yet. If you have a suggestion, email it in to letters@dailyreckoning.com.au with the subject line ‘Trend Name’.

Here’s the basic idea: rather than focusing on the world to try and find investment opportunities, take a look at yourself. Examine your preferences, spending habits, future plans, inefficiencies and abilities. All of these could represent ways to make, save and enjoy your money more. Rather than thinking about quantitative easing, company balance sheets, and price charts, think about you.  

What are some of the ways you can put this new trend into practice? Well, we can’t give away our ideas just yet. Apart from this one which featured investing in something you can consume, but in a way that uses time travel to generate profits. And then there was this one which could see you escape your mortgage without selling your home.

What’s yet to come in future issues of The Money for Life Letter?

Well, power bills are a topical issue, so let’s start there. Are there ways you can generate your own power cheaply, efficiently and without an environmental impact? Yep, there are two different ways. The first involves using Europe’s number one source of renewable energy.

(Hint: it’s not wind or solar and you’ll think we’ve lost the plot when you first hear about this idea.) The other option is all about a big upfront investment for a trickle of benefits. Whether or not you’ll benefit from this ‘investment’ is a matter of calm and cool calculation.

When The Money for Life Letter was first launched, feedback revealed retirees and those looking to prepare well for retirement are concerned about their future health. It just so happens that we’re at a turning point in the history of healthcare.

At the moment, all patients are diagnosed and then given a certain treatment. But what if it was possible to completely personalise medicine? What if you knew exactly what ailments you’re likely to develop, how to prevent them, and how to deal with them in advance? And if you still got the sickness, your treatment would be 100% personalised based on what drugs will and won’t work for you. Along with knowing the side effects in advance.

You could change your lifestyle to avoid getting ill in the first place. You wouldn’t spend money on drugs that don’t work. And you don’t have to get unnecessary tests. Put all this together and you could save hundreds of thousands of dollars in medical expenses over your lifetime. Not to mention a better quality of life. All it takes is one simple test you only need to do once in your life.

It turns out that this isn’t just an imaginary future. The technology to do all this exists. Celebrities like Steve Jobs and Richard Dawkins used it. In Taiwan, if you want access to a certain drug, you’re required to do a version of this test because the side effects of the drug are severe but predictable.

Recently, an American company has made it financially viable for you to run a limited version of this test. You can find out the following things about yourself:

  • Whether you are a ‘silent carrier’ of 50 different diseases
  • Your chances of developing 120 different diseases
  • How you would react to 21 different popular drugs
  • And more

Now this is only a limited version of the full test which will one day be available to you to completely personalise your medical affairs. But it’s still valuable information to know if you want to prevent illnesses, save money on drugs that won’t work or cause devastating side effects, and much more. In the next monthly issue of The Money for Life Letter we’ll be telling subscribers more about why they should take the test and how to do it.

The point is, retirement isn’t just about investing, profit, and maximising returns. It’s about you as a person too. And there are plenty of ways to make, save and spend money based on the unique person you are.

Last but not least, how about this for an investment? One very kind subscriber recently dropped by with a bottle of homemade whiskey. If you’re sick of the Rip-Off-Trend when it comes to luxuries in Australia, just invest in what you need to make your own! 

Nickolai Hubble.
The Daily Reckoning Weekend Edition

Join me on Google+

About the author: having escaped from academia, Nick decided to drop his tights (the required attire of a trapeze artist) and join Port Phillip Publishing. Instead of telling everyone about the Daily Reckoning, he now spends his time writing for the weekend edition.

ALSO THIS WEEK in The Daily Reckoning Australia

An Aussie Dollar Crash
By Dan Denning

In today’s episode of As the World Burns, we’ll look at why certain central bankers and politicians have the brains of un-evolved reptiles. It’s also time to be honest and direct about what Australia needs right now: a dollar crash. We’ll show you why.

Hiding the US Unemployed: Disability and the Politics of Stats
By Wendy McElroy 

Some statistics cannot be understood without being set within a political framework, because they reflect politics as much as, or more than, they do reality. The [US] unemployment rate is an example and a cautionary tale.

China’s Excess Capacity Problem
By Dan Denning

There is a real world outside the financial world. In that world, people use energy every day. And so out in the middle of Australia, in the Cooper Basin for example, Aussie companies are busy finding and producing that energy. The search never ends…in the meantime, it could be a rough day for the rest of the resource complex.

The Grandest Larceny of All Time
By Bill Bonner

Gold seems to be coming back fast. The Federal Reserve can’t keep it down. Of course, the Fed’s monetary meddling doesn’t work. And it will most likely cause a financial disaster. But the biggest scandal of today’s central bank policies is that it is essentially the grandest larceny of all time.

Nick Hubble
Nick Hubble is a feature editor of The Daily Reckoning and editor of The Money for Life Letter. Having gained degrees in Finance, Economics and Law from the prestigious Bond University, Nick completed an internship at probably the most famous investment bank in the world, where he discovered what the financial world was really like. He then brought his youthful enthusiasm and energy to Port Phillip Publishing, where, instead of telling everyone about The Daily Reckoning, he started writing for it. To follow Nick's financial world view more closely you can you can subscribe to The Daily Reckoning for free here. If you’re already a Daily Reckoning subscriber, then we recommend you also join him on Google+. It's where he shares investment research, commentary and ideas that he can't always fit into his regular Daily Reckoning emails.
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2 Comments on "Forget Investing, Let’s Spend"

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Rick W
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This shows a myopic view of investing. The “take control” trend is to assess and make personal investments that reduce your consumption costs. My solar panels return 9% on the original investment. I no longer have any household energy costs because electricity export pays for connection fee, electricity import plus heating gas. My diesel car uses half the fuel of the car it replaced. Taking into account all the factors in owning a car that investment has a 4% return. Not as good as cash currently in the bank but still a return. My woodchipper has an investment return of… Read more »
slewie the pi-rat
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the core problem is sound money. it has been replaced by unsound money. gee whizzikers! what would be the OBVIOUS next step toward restoring monetary sanity/health? not what will happen in ten more steps if we take the next OBVIOUS step towards soundER money. not what will happen in 400 years. just the next OBVIOUS step to address the sound money problem. anybody? in slewienomics, the answer to the “next step” is the SAME as the optimal solution to “the end game”. ergo, it will happen. b/c it MUST. and when the money gets “right” they will “pull the trigger”.… Read more »
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