Get the answer to your question from Coach John G. Agno. What we all want is interaction with others to clarify our thoughts before taking action and to allow our perceptions to evolve over time.
Privacy Policy We use third-party advertising companies to serve ads when you visit our website. These companies may use information (not including your name, address, email address, or telephone number) about your visits to this and other websites in order to provide advertisements about goods and services of interest to you.
For example, Google, as a third party vendor, uses a DART cookie to serve ads on this site based upon your visit to our sites and other sites on the Internet. You may opt out of the use of the DART cookie by visiting Google ad and content network privacy policy at: www.google.com/privacy_ads.html.
If you would like more information about this practice and to know your choices about not having this information used by these companies, please contact the Network Advertising Initiative (NAI) at (207) 467-3500 or www.networkadvertising.org.
These 4 charts show why you should be careful with this common investment "wisdom"
By Elliott Wave International
Robert Prechter's monthly Elliott Wave Theorist once published a ten-part study explaining why traditional financial models failed to foresee the 2007-2009 financial crisis -- and, more importantly, why they are doomed to fail again (and again).
On Thursday (Sept. 17), the Fed decided to keep interest rates unchanged. On Friday, stocks opened down big. But before you join those who blame it on the Fed, please read this excerpt from Prechter's eye-opening study.
***************
Economic theory holds that bonds compete with stocks for investment funds. The higher the income that investors can get from safe bonds, the less attractive is a set rate of dividend payout from stocks; conversely, the less income that investors can get from safe bonds, the more attractive is a set rate of dividend payout from stocks. A statement of this construction appears to be sensible.
And it would be, if it were made in the field of economics. For example, "Rising prices for beef make chicken a more attractive purchase." This statement is simple and true. But in the field of finance such statements fly directly in the face of the evidence.
Figure 3 shows a history of the four biggest stock market declines of the past hundred years. They display routs of 54% to 89%.
Figure 3:
In all these cases, interest rates fell, and in two of those cases they went all the way to zero! In those cases, investors should have traded all their bonds for stocks. But they didn't; instead, they sold stocks and bought bonds. What is it about the value of dividends that investors fail to understand? Don't they get it?
As in most arguments from exogenous cause...one can argue just as effectively the opposite side of the claim. It is just as easy to sound rational and objective when saying this:
"When an economy implodes, corporate values fall, depressing the stock market. At the same time, demand for loans falls, depressing interest rates. In other words, when the economy contracts, both of these trends move down together. Conversely, when the economy expands, both of these trends move up together. This thesis explains why interest rates and stock prices go in the same direction."
See? Just as rational and sensible. On this basis, suddenly the examples in Figure 3 are explained. And so are the examples in Figure 4. Right?
Figure 4:
No, they're not, because, as the first version of the claim would have it, there in fact have been plenty of times when the stock prices rose and interest rates fell. This was true, for example, from 1984 to 1987, when stock prices more than doubled. And there have been plenty of times when stock prices fell and interest rates rose, as in 1973-1974 when stock prices were cut nearly in half. Figures 5 and 6 show examples.
Figure 5:
Figure 6:
At this point, conventional theorists might try formulating a complex web of interrelationships to explain these changing, contradictory correlations. But I have yet to read that any such approach has given any economist an edge in forecasting interest rates, stock prices or the relationship between them.
Read about more common investment "wisdom" you should avoid in this free 33-page eBook. It takes the 10 most dangerous investment myths head on and exposes the truth about each in a way every investor can understand.
This article was syndicated by Elliott Wave International and was originally published under the headline "Interest Rates Drive Stocks"? See 4 Charts That Tell You the Truth. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.
Over the next few days, we're inviting you to watch a recent live talk given by Elliott Wave International chief market analyst and former Merrill analyst Steve Hochberg to a packed audience of some of San Francisco's top independent investors.
To watch key portions of Steve's 45-minute talk, please follow this link to sign up for this free online event.
But there are a couple of things you should know first:
EWI rarely shares extended versions of Steve's talks, because they are typically reserved for subscribers of his Financial Forecast Service. (Plus, they are often longer and directed toward investors with a solid footing in technical analysis.) But what he said in San Francisco caught our attention. So we asked EWI for permission to share Steve's talk with you. They agreed and broke it down into five key clips to make it quick and easy to grasp.
I'll be honest; some of Steve's insights are downright SCARY. But I think you will find his perspective refreshing, because his thoughts on global debt, real estate, the Federal Reserve and shifting investor psychology will dovetail with your independent market perspective, while his charts show you the evidence that informs his forecasts.
And as Steve says, the evidence is important.
"I can give you my opinion ... but you need evidence. You need to see why we think the way we do. And that's what a chart is. A chart is actual history of what occurred and what is occurring, and then you can look at it and make up your own mind."
As you watch Steve's talk, please keep in mind that with the largest crises come the greatest opportunities. But you have to ready to take part. And to be ready, you have to anticipate them.
Please sign up for this free online event, enjoy one week of video updates from Steve, and as he says (and we agree), you can make up your own mind after that.
In this new interview, Elliott Wave International's Mark Galasiewski discusses the panic in China over the Shanghai Composite's recent decline.
Learn why, from the Elliott wave perspective, the Shanghai Composite's recent decline is a relatively normal occurrence -- and what it implies for the future of Chinese stocks. Watch.
Learn how EWI's Mark Galasiewski forecast the action in the Chinese markets, starting with a bullish call he made last July -- at a time when everyone else was down on China. Then see his current outlook.
This article was syndicated by Elliott Wave International and was originally published under the headline (Interview, 3:41 min.) Decline in Shanghai Composite: Kickoff to a Larger Move?. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.
When you are faced with a challenge and become stuck, you may seek the services of one or more of these professionals:
a consultant
a lawyer
an accountant
a therapist
a mentor
a personal coach
or some other advisor.
However, your self-selecting choice matters.
Choosing the wrong expert can waste time, money and put your organization on the wrong course of action. That is why knowing what kind of help you need and who is best able to supply that specific type of help is important.
The water can be muddy when sorting out the roles advisors play today; especially, when many consultants, therapists, lawyers and mentors may also call themselves personal or business coaches. When you really need a professional coach, it would be a mistake to engage to some other professional.
Personally, I am a recovering management consultant. At some point, it seemed to me that solutions for client problems seldom became a permanent fix due to leadership blind spots preventing seeing why the problem arose in the first place. So, I began doing more business and executive coaching by helping clients to fix their own problems and personally excel in their personal and professional lives.
Yet, few potential clients seem to know what a business coach is and does---many continue to categorize me as a consultant. Conversely, management consultant firms are working to transform themselves into becoming more coach-like since personal and business coaching works well in situations where consulting may not.
So, what's the difference between coaching and consulting?
A consultant is brought into an organization because of his or her knowledge and experience to solve a specific business problem. The consultant proactively solves the problem and then disengages. Whereas a coach is brought in to guide the executiveor business owner in solving their problem and then disengages. The difference is subtle but important.
The coach assists the client to understand whatever is causing the problem so the client can solve the problem today and when or if it reoccurs. Whereas, the consultant knows or discovers what caused the problem, solves the problem and leaves without transferring this knowledge to the client. When the problem reoccurs, the client may simply call the consultant in again to resolve the problem, time-after-time.
If you are willing to call or recall someone to fix problems as they occur, call a consultant. If you want to learn what is causing the problem and how best to fix it now and in the future, call a coach. The choice is yours.
In the early 1700s, a string of lakes and Mohawk tribe land was of interest to the white men.
The existence of some of these lakes were shown on a military map of the Mohawks in the files of the English war office and dated 1720. That map shows an outline of the Mohawk River flowing through their country with the American Indian castles on its southern bank and also shows the Cayadutta, Garoga and East Canada creeks...the latter called by the Indian's Caicharon. At the end of the Caicharon is shown the Garoga lakes. The Cayadutta is shown attached to the Sacandaga at Northville.
Mapping of these lakes with such accuracy was unlikely through American Indian reports alone. It seems that some white men would have seen them also.
The land from near Schenectady to Herkimer and north to Canada and for considerable distance south of the Mohawk River was the Mohawk country although before this time they had sold some tracts to the white men who were settling thereon. In 1703, they had sold the great Kayaderosseras Patent (mostly in today's Saratoga County although covering parts of Perth and Broadalbin) but had sold no other lands in Fulton County until 1723 when twenty-seven Palatinates from Schoharie secured from them 12,700 arces, partly in Montgomery County including in Ephratah and Johnstown.
The Native Americans were jealous of trespassers in their country and no permanent settlers were permitted by them prior to purchases of the land. The purchase prices were really nominal. In almost every instance, it consisted of fat beasts, fire arms and powder, and rum. After a sale was made by the Native Americans, it had to be confirmed by the English government to be effective. Between 1723 and 1770, all the remaining land in Fulton County had been sold by the Mohawk Indians to white men excepting what was the Glen, Bleecker, Lansing and Chase Patents.
In 1769, it was evident that a bargain had been made with the American Indians for this tract because in that year Sir William Johnsonemployed James Campbell, a surveyor residing in Poughkeepsie, to make a survey for their outbounds. Campbell, accompanied by Peter Getman of Stone Arabia, an ancestor of Oliver Getman, started at Emmonsburg and ran a straight line northeast to a point a few rods north of West Stoner Lake and there marked a tree. On return to Emmonsburg, he followed the north line of the Lott and Low Patent to Caroga Creek. There he rested a day while Captain Getman went to Stone Arabia after provisions. He started again from the Caroga Creek at a point just north of Cosselman's store and ran east until he struck the Mayfield Creek. He then visited Sir William Johnson for a couple of days and returning ran north until he struck the Sacandaga River and then turned west through the town of Benson and Arietta until he struck the tree that he marked on West Stoner Lake.
These surveys under the English law were required to be made before the sale from the Mohawk Indians would be confirmed by the government. This survey included within its boundries the Mayfield and Chase's Patents, as well as the Glen, Bleecker and Lansing Patent. It is evident that the application was to be made in two sections for the Mayfield Pateent sale was confirmed by the government in 1770 and, in a letter to Sir William Johnson from his agent in New York (where the council met appraising him of the fact that the Mayfield Patent sale had been confirmed) and advising him not to press the balance for the present, that much jealousy was being aroused at these large sales to Johnson or Johnson's friends.
The balance of the tract was never confirmed to Johnson. It is fair to assume that the Mohawk Indians had sold him the tract or the survey would not have been made but it was not confirmed and was legally owned by the Mohawks or the Canajoharie tribe until the War of the Revolution.
The War drove the Mohawks from the valley. What lands they had owned became the property of the state by conquest. In 1794, the land commissioners of the state, on the written application of Cornelius Glen, Baron Bleecker and Abraham G. Lansing, sold to them this tract consisting of 89,000 acres at one shilling and sixteen pence per acre, it being provided in the warrant of sale that within seven years of the date of the purchase one family should be settled on the land for every 1,000 acres in it; that is, by 1801, eighty-nine families must be on the property. There was no reversion of the land by 1801, hence it is certain that sales were made to that number of families.
This tract reached from a point at Emmonsburg Bridge, spreading out north to the county line at West Stoner Lake and southerly to the Lott and Low Patent and thence to the East Caroga Lake and to the line of the Mayfield Mountains.
The most salient feature of the tract was and is the group of lakes of which this is the largest. In the Mohawk times it was their hunters' paradise. Its natural beauties with its present mutilated forest attracts everybody and if the forest in the passage of time again becomes mature how increasingly attractive it will grow.
Just below the hamlet of Caroga on the banks of the creek, are the remains of one of the oldest and largest Mohawk Indian towns in eastern America. Remains have been found, in fact the greater part of Mohawk Indian relics now in American museums were secured at this site....including clay vessels made for domestic and other uses by the Mohawk Indians in this section were manufactured on the clay banks at that point.
An American Indian trail led from this town straight over the hills to Canjoharie Castle. Another trail went north following the Caroga, branching just west of Pines Rest on the Johnstown road, one trail leading past Stewart's Landing, Emmonsburg to Oswago, the other on the west side of West Caroga Lake through an Mohawk Indian town on the north shore of that lake past the east end of Canada Lake, past Pine, Stoner, Good Luck and Piseco lakes and then on to the St. Lawrence.
There was another trail leading from the upper Mohawk Castle at Danube, up the Caioharon to the Mohawk Indian town on this lake located on the point between East and West Lakes. On Stoner Lake there was also a town.
Many years ago, James Oathout, who lived on the Stoner Lakes, discovered a cave kept dry by ventilation through the roof in which several very large corn jars had been preserved intact from the time of the American Indian occupation. One of these jars is in the Albany museum and another in the Ft. Johnson collection, the finest specimens of Iroquois pottery in existence. They were undoubtedly transferred from the Caroga clay bank where made, hung on poles, carried on shoulders of their women and because of their bulky nature never removed from the place where they were used for the storage of food.
Note: Is it Caroga or Garoga?
The word Caroga is a Native American word, meaning "by the streams or waterways."
In the book, "Fulton County: A Pictorial History,"the controversy over the spelling was settled in part through the influence of Cyrus Durey who cites a "Little Ditty": "Old Cyrus D. he says, says he/They're just plum crazy, those folks be/to spell Caroga with a G."
For more on the history of Upstate New York communities, take a look at these URLs and books:
The real reason consumers aren't spending is not a matter of monetary policy; it's a matter of psychology
By Elliott Wave International
On June 2, the postman rang once -- and, boy, did he ring.
That day, the Wall Street Journal published a strongly worded letter titled, "Grand Central: A Letter to Stingy American Consumers," which included these notable passages:
"Dear American Consumer,
"This is the Wall Street Journal. We're writing to ask if something is bothering you. The sun shined in April and you didn't spend much money. The Commerce Department here in Washington says your spending didn't increase at all, adjusted for inflation last month, compared to March.
"You've been saving more too. You socked away 5.6% of your income in April after taxes, even more than in March. This saving is not like you. What's up?
"Fed officials want to start raising the cost of your borrowing because they worry they've been giving you a free ride for too long with zero interest rates. We listen to Fed officials all of the time here at The Wall Street Journal, and they just can't figure you out."
Well, on behalf of the "stingy American consumer," we'd like to answer this letter to best of our ability.
"Dear Wall Street Journal,
"Your frustration is well founded. Something is off. People have taken the Fed's gift of free money and returned it to sender. This isn't normal, as the chart of the total savings versus the Federal Funds rate since 1975 shows.
"Here you can see that for the better part of four decades, lower rates coincided with mild to steady savings... until mid-2000. Then, the pattern changed drastically. The cheaper it became to borrow, people borrowed less -- a lot less.
"'What's up?,' you ask? What changed to compel this radical shift toward thrift?
When the social mood trend changes from optimism to pessimism, creditors, debtors, producers, and consumers change their primary orientation from expansion to conservation.... consumers save more and spend less.
A defensive credit market can scuttle the [central bank's] efforts to get lenders and borrowers to agree to transact at all, much less at some desired target rate.
During deflation, they cannot even induce them to do so with a zero interest rate.
"Deflation? Nobody said anything about the "D" word, but in fact, that's exactly why consumers have gone on a buying boycott. Conquer the Crashwrites:
These behaviors reduce the 'velocity' of money, i.e. the speed with which it circulates to make purchases, thus putting downward pressure on prices. These forces reverse the former trend.
"Note the emphasis on 'downward pressure on prices.' Here, our November 2014Elliott Wave Financial Forecast shows you ample evidence of its arrival:
Most economists are baffled: 'One of the greatest mysteries is why the U.S. has lacked inflation, despite all the money being pumped into the economy.' This long-term chart of the CPI shows a succession of lower highs since the early 1980s, as inflation turned into disinflation, which is on the cusp of leading to outright deflation.
Some argue that the Consumer Price Index is rigged to show milder levels of inflation, but the bottom graph shows the same steady move toward the zero line in the Personal Consumption Expenditures Index, an alternate inflation measure favored by the U.S. Fed.
"Deflation is rare. Because of that, few people understand it. Deflation is also tricky, because it makes even the most 'reliable' financial assets to lose value, and those assets that no one expects to grow to actually gain.
"The 'stingy' consumer is not the cause; it's the effect of a deflationary trend now underway in the world's largest economy."
Get this free 10-page report about the unexpected but serious risk to your portfolio -- with highlights from Robert Prechter's New York Times' business bestseller, Conquer the Crash.
You'll get 29 specific forecasts for stocks, real estate, gold, cultural trends and more.
This article was syndicated by Elliott Wave International and was originally published under the headline The Fed's Gift of Free Money: Return to Sender. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.
The Mohawk Indians had named the place "Kennyetto" (Ken-nee-ett-o) which was a fresh water creek and meant "a serpent trying to swallow its tail." This name, according to Isaac R. Rosa, was written by a Mohawk Indian with red chalk on the door of a grist mill....since the creek ends not far from where it began after flowing through the area.
Map of the Kennyetto Creek:
The name "Broadalbin" was given to the Town on March 12, 1793 by Daniel McIntyre, from a place of that name in Scotland. The original spelling was "Breadalbain."
But this locality, long before and long afterwards, was commonly know as "Fonda's Bush", after the best known and most numerous family who where native to Holland and had settled in the Mohawk Valley as early as 1650. Before the Revolution, Major Jellis Fonda secured a large tract of land in this neighborhood. So it was called "Fonda's Bush or Woods."
The first white settler within the limits of Broadalbin was Henry Stoner who came to this wilderness about 1770 with his two sons from the Jersey sea-coast. A historical society marker reads today on North Second Avenue in the Village of Broadalbin: "Nick StonerHut: Henry Stoner and his sons Nick and John held the cabin against the Tory and Indian Raiders who burned Broadalbin, June 1777."
In 1773 Philip Helmer located about two miles east of Stoner's place. Soon there was a small settlement there. After the war of the Revolution had opened, the fear of the Native American marauders forced the straggling settlers, like the Stoners, removed early in the summer of 1777 to gather around the protecting fort at Johnstown.
After the Revolution, the country began to fill up with New Englanders and Scottish Highlanders.
Before the Revolution, Sir William Johnson (who was the Superintendent of Indian Affairs and a General in the English Army) had created the settlement called Johnstown.
Sir William brought in many Scottish and English emigrants and settled them on his lands in Broadalbin, Mayfield, Northampton, Johnstown and eastern Ephratah. The Highlanders brought their tools--needles, thread, and the sword-like shears necessary for cutting leather---and they brought the closely guarded guild craft techniques of Europe. Material they found in abundance. The American Indians provided the skin hides that gave gloves a unique durability and feel. The crystal-clear water from the Adirondack mountains was perfect for the tanning of leather. And the U.S. glovemaking craft was born.
Sources: "The Saints of Broadalbin" by Rev. Harry B. Erkman
"The Life of Margretta" is the story of a 20th Century woman who was born, lived her life and was buried in a small village, named Broadalbin, in Upstate New York.
Within her book, she writes about how the name, Margretta, has been passed down in her family beginning from the marriage of a young woman named Otstock (born of a Mohawk woman and Frenchman by the name of Hartell) to a Dutchman, named Cornelius Antonissen Van Sleyck, who emigrated to the colonies in 1634.
Otstock was given the Dutch name "Margretta" and her husband was given the name "Broer" or brother and adopted into the Mohawk tribe after their marriage. The first North American Margretta and her new husband spent long periods of time in Canajoharies, the home of the Mohawks. As a family tradition, the name, Margretta, has been passed down as a middle name to girls thereafter....including the author's daughter, Jill Margretta.
When 2015 began, the mainstream financial experts were certain of one thing: Even if the United States economy were sliding into deflation (which, they said, was open to discussion) that particular kind of Glinda the Good deflation, characterized by plunging energy and food prices, was going to be a boon for consumer spending:
"Good deflation a tax cut for working families," affirmed a February 2 Huffington Post. "Cheaper gas means more flying, more driving, more hotel occupancy, more use of restaurants and leisure facilities. In short, deflation driven by the rapid decline in oil prices is good news for America."
So, what's happened since?
Well, according to an April 16 article in the Chicago Tribune, the sharpest annual decline in oil prices since 2008 somehow translated into not more, but less non-essential consumer spending. In March, U.S. retail sales clocked their third straight monthly decline -- which doesn't make sense, said the Tribune:
"This is puzzling. Why would consumers spend less when the economy picks up steam, and why haven't consumers gone shopping with the 1% extra income that collapsing oil prices have handed them?"
The piece then offers a few possible reasons -- such as cold weather, stagnant wages, business cuts, and so on. But none of them feel adequate, leading back to the initial shock:
"Consumers have defied expectations. Investors who anticipated purchasing-power gains would lead to greater consumer spending must be sadly disappointed."
We absolutely agree. Consumers have defied expectations -- those of the mainstream experts, that is. But they have completely complied with our long-standing expectations of a shift toward thrift, as laid out in chapter 9 of Bob Prechter's business best-seller Conquer the Crash.
There, Prechter explained how, in times of deflation, the trend toward non-spending is not a rational decision; it's an emotional one:
"The psychological aspect of deflation cannot be overstated. When the social mood trend changes from optimism to pessimism... consumers change their primary orientation from expansion to conservation.As consumers become more conservative, they save more and spend less. These behaviors reduce the 'velocity' of money, i.e. the speed with which it circulates to make purchases, thus putting downside pressure on prices."
Then, in November 2014 Elliott Wave Financial Forecast, we showed definitive proof that deflation -- not the "good" kind -- was set to arrive in the United States:
In other words, the conservatism called for in Conquer the Crasharrived in 2006-2008, and it continues to restrain consumers and corporations.
For years now, the Fed along with most economists have anticipated the imminent return of inflation, but it continues stubbornly subdued. This long-term chart of the CPI shows a succession of lower highs since the early 1980s, as inflation turned into disinflation, which is on the cusp of leading to outright deflation. Some argue that the CPI is rigged to show milder levels of inflation, but the bottom graph shows the same steady move toward the zero line in the Personal Consumption Expenditures Index, an alternate inflation measure favored by the U.S. Fed.
As it approaches, deflation will introduce itself to people in subtle and not-so-subtle ways.
The first way was consumer spending. Now, our brand-new May 2015 Elliott Wave Financial Forecast shows you an equally compelling chart of U.S. consumer credit since 1980 that confirms: deflation is now "playing catch up" to debt.
Get this free report about the unexpected but imminent and grave risk to your portfolio. You can read this special 10-page report -- with highlights from Robert Prechter's New York Times bestseller Conquer the Crash -- You Can Survive and Prosper in a Deflationary Depression. You'll get 29 specific forecasts for stocks, real estate, gold, cultural trends and more.
This article was syndicated by Elliott Wave International and was originally published under the headline "Glinda the Good" Deflation Isn't Looking So... Good. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.
Editor's note: This article is from Elliott Wave International's brand-new investment report, "U.S. Investors Face a Giant, Historic Bubble." It originally appeared in the April issue of The Elliott Wave Financial Forecast, published March 27, 2015. For a limited-time, EWI has agreed to give our readers exclusive free access to the full report. Please click here to read it now.
In March, we covered the return to a popular fascination with technology.
The striking resemblance to 2000's technology mania is not going unnoticed. How can it?
With the NASDAQ's much heralded return to 5000 and magazine covers proclaiming "Google Wants You To Live Forever," concern about an "asset bubble" is being raised. But this is actually another throwback to early March 2000, when the NASDAQ reached its all-time high and the Financial Forecast remarked on a "public ambivalence toward warnings of any kind."
The March issue of The Elliott Wave Theorist explains that while people may remember some of the details, they "forget their prior mood and rationalize present extremes into normality."
This March 7 headline from a major financial paper offers a perfect example of how this "normalization" works: "Forget 2000. It's a Different Investing Ballgame." Really? Yeah, really. "It really is different this time," says another. "The crazy valuations seen at the turn of the millennium -- when silly concepts, such as collecting eyeballs, attracted billions of dollars from breathless speculators wanting to get in on the new, new thing -- are absent."
There's just one problem with this assessment, it's not accurate. Here's the reality, or should we say surreality, as depicted in Bloomberg on March 17:
The Fuzzy, Insane Math That's Creating So Many Billion-Dollar Tech Companies
The article discloses how companies are shooting to "astronomical valuations," mostly with Internet ideas that capture people's bullish imaginations and, as in 2000, cause them to look beyond mundane things such as cash flow and profits. Once again, such stone-age metrics are less important than "the number of people using the product" and "whether they pay for it. Investors salivate over what's called 'hockey-stick' growth curves, indicating massive uptake. Costs, especially operations costs, are largely ignored."
As in 2000, the fever has been spreading fast. According to Bloomberg, start-ups with billion-dollar valuations were once dubbed "unicorns" because of their rarity. Now, Bloomberg counts more than 50 of them. Many have expanded ten-fold, so a new buzzword, "decacorn," now applies to those with capitalizations of more than "$10 billion, which includes Airbnb, Dropbox, Pinterest, Snapchat and Uber."
Of course, the driving force behind many of these investments is the same--a fear of missing out (FOMO).
"A severe case of FOMO can cause some to do crazy things to get into the hottest deals," says Bloomberg. This is exactly what the Financial Forecast said in March 2000, when we explained why people fail to heed ample warnings in the final throes of a mania: "Acting on such an opinion might mean missing something on the upside. 'The average person must ride it out,' says [a] Nobel Prize winner. Quotes such as these will deserve preservation in bronze when the bear market is mature." Clearly, that time still lies ahead.
For compelling Elliott wave evidence of a culmination of the Mania Era, see the five-wave advance in the share price of the current technology leader, Apple Inc., on page 3 of the March Elliott Wave Theorist. As the Theorist notes, after rising more than 14,500% over the past 12 years, S&P Dow Jones Indices added the stock to the Dow Jones Industrial Average on March 19.
This is one more remarkable parallel to the prior technology mania, as Microsoft was added to the Dow Industrials just prior to its January 2000 top. Here's how EWFF interpreted its addition in November 1999:
The ultimate concession to technology is due November 2, when Microsoft will be inducted into the Dow Jones Industrial Average. For most of the bull market, the world's most dominant stock was excluded from the world's premier blue-chip average. But just as RCA was added to the Dow in October 1928 (and removed in 1932), Microsoft has assumed its rightful place at the head of the pack, in time to lead the way down.
Apple has just been acknowledged in the same way and for the same reason. The pressure to pile onto the technology bandwagon has proved irresistible to the Dow's purveyors. This has generally happened when the most important stock market reversals were at hand.
Editor's note: This article is from Elliott Wave International's brand-new investment report, "U.S. Investors Face a Giant, Historic Bubble." It originally appeared in the April issue of The Elliott Wave Financial Forecast, published March 27, 2015. For a limited-time, EWI has agreed to give our readers exclusive free access to the full report. Please click here to read it now.
Q: I just returned from vacation where I had a chance to think about how I want to live my life differently. I know that I want do something else in my career but I am not sure what. Do you have any advice on what I can do about this discontent that I am feeling?
A: Every year, we gain a clearer understanding that without positive change, decline is inevitable. Still it's easy to lose hope: barriers to change seem to be everywhere. We work in organizations that aren't much fun. We fail to gain work/life balance that is so important to us but so difficult to sustain. Looking ahead, the challenge is to recognize that what we are now tolerating can be reinvented.
Most people returning to work from a relaxing vacation, where they took stock of their life, question if they are on the right career path but don’t do anything about it. "I'll be happy when...." is the way many people think they are living their lives. A fortunate few decide not to languish in their present job and begin the process of engineering a mid-career correction. Here is how these very few do it.
They recognize that happiness is not something that happens to you. Happiness is inside you now. You are motivated from within as you discovered while on vacation. You only have to allow happiness to continue to surface after the vacation in your work and personal lives.
The formula for happiness is to know yourself, discover what you do best and understand that you get what you tolerate. In medicine, you look at how "well tolerated" a drug will be related to its side effects. At work and at home, many people evaluate new opportunities related to what can be well tolerated. Yet after life, most people don't want their tombstone to read, "She tolerated stuff for other people because they paid her." Especially, when we realize that we can make more money and have more fun doing work that engages our passions. Life is too short for doing work you don't enjoy.
That said, I don’t recommend that you immediately leave your job but do begin the career transition process to visualize where you want to be. The first step is to change the way you think about yourself. Since what we think, we become, it is important to convince ourselves that we can change, so we do change. Believing comes first, then change, not the other way around.This rethinking who we are helps us to begin to consciously separate ourselves from our current job and life.
As you become clearer on where you want to be, you begin to modify your career path to be more in line with who you have become. Clarity happens as you get to know more about who you are by engaging in self-learning exercises. You also speed up the career transformation process through taking some self-assessments to match your strengths, interests and personality with potential work choices.
Everyone should know the important things in their life---your family, your partner, your health and well-being, your children---anything that is so important to you that if it were lost, you would be devastated.
After you know what’s important to you, engage in selective reading and take a few personality and career self assessments to get to know you better.Here are some self-assessments in books that you can buy at your local or online bookseller:
Tom Rath: StrengthsFinder 2.0
Marcus Buckingham: StandOut: The Groundbreaking New Strengths Assessment from the Leader of the Strengths Revolution
Kevin W. McCarthy: The On-Purpose Business: Doing More of What You Do Best More Profitably
The results of practicing the new discoveries and habits you learn over time are that they become part of your new real self.
Often, with changes in your habits, come changes in your aspirations and dreams. Going through the discovery of uncovering an ideal vision of yourself motivates you to develop new abilities to create and sustain the new habits. That is, you see the person you want to be---living with the new habit. This becomes the source of the energy required to work at the difficult and often frustrating process of change.
