How an Extra $1 a Day Will
Generate Fortunes By Jeff D. Opdyke, Editor, The Sovereign Individual Dear Sovereign Investor, What would you do with an extra dollar today? Probably wouldn't make much of a difference in your life. But it's the key to one of the most-compelling investment opportunities in the world today. It rests upon two underlying, simple but interconnected forces ... one economic, the other demographic. As once-poor people get richer, they stop worrying about how to survive until tomorrow and, instead, focus on eating better food, renting better housing, maybe even buying a motor scooter and stashing away some savings to build a financial cushion. They might even begin pursuing a bit of leisure.
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The shift, I tell everyone who asks, represents the biggest social trend of the next 30 years. We are smack in the middle of a massive shift in demand from the developed world to emerging markets. And as investors, we want to participate in that. An Extra $1 Changes Everything In America, "middle class" means earning at least $36,000 a year, if you believe Census data.
In many emerging markets, however, double your daily income to $2 - the equivalent of less than $800 a year - and you've pulled yourself and your family out of poverty and onto the first middle-class rung.
In my years as a financial reporter and writer, I've learned that great companies never crop up by accident, and neither do great investment opportunities. Instead, both are typically a response to some economic phenomenon.
The problem is that investors never see a global phenomenon until it's already upon them - and by then they've missed the easy money. Part of that blame falls on Wall Street, where brokers rarely look past America ... and those that do generally stick to major markets like London, Frankfurt and Tokyo.
To profit from the rise of the emerging-market middle-class, then, requires that you rethink what Wall Street has told you for decades. Because, the richest veins on the planet today run through places like Jakarta, Hanoi, Accra, and Dubai, Shanghai and Mumbai - the areas where literally hundreds of millions of new consumers are taking root. Finding the "Micro Booms" Successfully profiting from the emerging middle-class, means having money at work before Wall Street catches a clue. I call it investing in "Micro Booms" - owning the companies in countries and industries that are serving the new consumer overseas.
Imagine, for example, that you had understood the market forces that originally propelled companies such as Wal-Mart, Microsoft or IBM to greatness, long before the Wall Street feeding frenzy took hold. You would have been in and out of those stocks with huge gains before the real opportunity was lost. Too many retail investors listening to Wall Street end up jumping into these secular trend stories after the rest of us have taken our profits and moved onto the new, emerging trends. Consider this: Over the next decade, somewhere between one and two billion new middle-class consumers will pursue the same goods we in America assume is our birthright. That's a population five to 10 times larger than America's current middle class. It will prove to be the single most important demographic shift of our lifetime - and probably our kids' lifetime. Consider just one number to put this trend into perspective: 4.5 billion.
That's the number of additional cars, trucks and buses competing for space on the world's roads if every country had the same number of vehicles per capita that you find here at in the U.S.
Whether that concentration of cars ever materializes is irrelevant. It's the direction of the trend that's important.
At the moment, per-capita car count in China is where America was in 1914 ... and China is the #2 car country in the world.
India is where America was in 1913. Even moving to America circa 1950 or 1960 would mean hundreds of millions of new cars on the roads in India and China alone. Investment Opportunities Where
Demand is Exploding Such a dramatic rise in vehicle demand offers up obvious - and not-so-obvious - investment opportunities in foreign markets where consumer demand for cars and car-related products is exploding.
Sure, there's the obvious play on owning car makers in China and India - which is already a trend long in the tooth. But there are also plays on car dealerships in Indonesia (the consumer population there is large and growing rapidly), or on compressed natural-gas fuel tanks out of Norway (CNG cars are the next big industry leap). Those are the trends to look for. But the car industry is just one example of hundreds. Ultimately, what I'm talking about is a powerful economic force that will result in surging consumer demand in scores and scores of industries, rapid GDP growth and a new consumer economy across great swathes of what was once the undeveloped world. We're on the precipice of dramatic change ... a new generation of buyers outside of America is eagerly opening their wallets. As Sovereign investors, our mission is to understand that opportunity before it is old news, and grasp it with both hands. Until next time, keep a global view...
Jeff D. Opdyke P.S. Micro Booms mean opportunity, and if you want a chance to find out what the biggest opportunities of 2012 are going to be, you can't miss this year's Total Wealth Symposium. I'll be revealing the Micro Booms I see ready to explode onto the global scene this year, and I won't be alone: Our experts Bob Bauman, Andy Hecht, and Sean Hyman will be there with me to give you even more MUST HAVE information on everything from how to profit on precious metals this year, to insulating yourself from the failing US dollar with currencies, to protecting your wealth for the years to come. With all this set against the backdrop of beautiful Los Cabos, this is an opportunity that can't be missed. We only have a few open spots left, so don't miss your chance: find out how you can register TODAY | |
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