The Energy Revolution Is in Motion

What a morning!

We’ve watched such an incredible lineup of speakers so far that it’s hard to believe there are even more great presentations to follow this afternoon

The guests are amped, and so are the speakers.

Rodney Johnson kicked us off this morning, bright and early, talking about the next phase of energy.

As he explained, oil was once the ticket, but batteries are now changing the world. Once we can store energy, we get control, and that’s going to make some people very angry.

It is truly energy, money, and control, and Rodney walked us through the history of oil to prove it. It’s a true tale fraught with greed and political chicanery. In the 1970s, this led to oil going from $3 dollars a barrel to $12… in six months! Many of you remember that pain.

Today the race is on the find alternatives, and it looks like batteries are about to make the revolution.

Lithium-ion technology still has issues, like exploding devices, but the bigger problem is that it doesn’t work like we need it to for the next phase.

The problem with Tesla is that its batteries still take a long time to charge.

However, battery power is getting cheaper. Today it’s about $140 per kilowatt hour. But we need it at $100.

In walks…

The solid-state battery. That’s the ticket! And Rodney explained it all. You can listen via the IES Archive Kit, which you can access here

The technology will impact cars (watch out for Toyota here)…

It’s impacting power storage in our homes…

It’s improving mowers (E-go, Ryobi, Snapper), home appliances (iRobot, Dyson), cell phones, and laptops and tablets! (Dyson even recently announced it’s making an electric car!)

But none of this means oil is dead. You’ve got to listen to Rodney’s explanation.

The really cool part is who wins in this energy revolution. Well, YOU AND I win. We pay less for the power we need, and it’s going to get cheaper! We also win with the investment opportunities that are already popping up. Albemarle Corp. (NYSE: ALB) – a lithium miner – has been in the Boom & Bust portfolio for about a year now and is up about 70%. Rodney discussed the other opportunities out there (as well as the losers).

Based on the audience’s reactions during Rodney’s presentation, his message resonated!

Next was Raoul Pal, who talked about the global risks according to the “Masters of the Markets.”

He started by sharing a very interesting video, which I recommend you watch if you missed it. It was about the drumbeats that Raoul and his contacts are hearing right now.

Clearly, something’s wrong. All of the famous investors are watching something, and they’re scared. They talked to Raoul and his team about it…

  • Kyle Bass warns that if you see the markets crack a little, buckle up. Among other things, he points to the geopolitical situation (as does Harry) and how it’s all coming to a boil.
  • Jesse Felder says that investors are taking on an incredible amount of risk for the prospect of zero potential reward over the next 10 years. There are many parallels today to the early 2000s experience, he said.
  • Jim Rogers announced that we’re about the see the worst bear market of your lifetime, and it’s likely to start next year, maybe even this year!
  • Mark Yusko says we’re at a very important junction. He said a year ago that things were looking bubbly, but now it’s even worse, and it’s time to get cautious.

As Raoul demonstrated, experts are worried about the stock markets… they’re also worried about the economy…

He shared a U.S. Leading Indicator chart, and it’s terrifying.

It was interesting to note that all of these men were saying the same things Harry has been saying for a while now (about debt and bubbles and demographics, etc.)!

There are so many warning signs that it’s almost like we trying to swim through a growing swarm of deadly jelly fish!

I found Raoul’s talk very distressing. It left that uneasy feeling in the pit of my stomach. How about you? If you’re watching in person or via LIVE Stream, what thoughts did you take away from Raoul this morning?

Let me know by emailing me at economyandmarkets@dentresearch.com

Adam O’Dell took the stage after Raoul. His message: how primal fear kills investor performance (quite appropriate considering Raoul’s message)… and what you can do to overcome it.

To start, we need to ask ourselves why we’re investing. In his experience, we do so for two reasons: two make money or to feel smart. Only one of those reasons is a good one!

So, if you invest to make money (which is the only reason you should invest), then the only question you should ask is, what moves market prices? Adam offered a list of about 10 price movers. But then he noted that none of these things actually move prices and explained why.

There’s only one factor that moves market prices all of the time, and Adam did a magic trick to demonstrate.

Definitely a presentation worth watching if you missed it.

In short, understanding and conquering fear is the key to your success as an investor…

  • A recent study by Dr. Andrew Lo found that professional traders (people who do this for a living and aren’t even using their own money) experienced the physical symptoms of fear during periods of heightened volatility!
  • A Dow Bar study shows that fear actually KILLS investor performance. See for yourself…
  • If you’re a buy-and-hold investor because you let fear control you, your success as an investor is entirely dependent on luck! You didn’t decide when to be born, yet that determines what bear or bull markets you endured as an investor.
  • There’s a “Dying While Broke” paradox: You MUST invest in risk assets, yet we psychologically CAN’T (thanks for our fears). But there is a solution, and that is to invest in risk assets using a system! Specifically, that system must eliminate your emotions and your decisions.

After a much-needed coffee break, where guests flocked to Adam, Raoul, and Rodney to ask questions and just chat, Mark Gordon took the mike and wowed us with tales of the deep!

Mark shared a nightmare that was you wouldn’t think could be real, but it absolutely is, and it taught him an invaluable lesson about surviving adversity.

His company, Odyssey Marine Exploration (Nasdaq: OMEX), is a leader in deep-ocean exploration. In 2012, it made it into the Guinness World Book of Records for one of its campaigns, during which Mark’s team recovered hundreds of millions of dollars of silver.

He posed this question: Imagine that you woke up one morning to discover your company and investment was only one-third of its value the day before… imagine the Federal government was basically gunning for you.

That’s what happened to Mark, on June 4, 2009, after his company had recovered tons of coins from the ocean floor. They code-named the recovery “Black Swan” (rather ironically). The “Black Swan” should have realized his company massive gains from their efforts. Instead, it landed them a $1.2 million fine!

While it damaged the company, it didn’t destroy it. And Mark explained how he and his team turned their fortunes around. He shared five action steps to take to pivot to success.

Mark’s speech was inspirational. He made it clear that anyone can pivot to success! And he detailed four baskets to consider when studying investments in this sector.

Finally, Dr. Lacy Hunt stood up to talk about five different hypotheses for the macro economy. Dr. Hunt is the only economist that Harry trusts, and he’s been a regular at our conferences over the years.

He was a favorite of the audience as well.

Did you know…

  • The personal saving rate (everything we earn, less our consumer expenses, less taxes, plus interest earned) has been 8.5% since 1900. In August 2017 that rate was only 3.6%!
  • Our economy is no longer growing, in terms of household income, at the rate it traditionally did. Since 1956 the average rate of growth was 2.1%. In the last 12 months that growth rate was only 0.6%!
  • Monetary policy is very asymmetric today. A lot of easing does little, but a little tightening will go a long way! If the Federal Reserve executes QT (quantitative tightening) for just one quarter, money supply growth will sink from 5.3% to 4.2%. If it did it for 12 months, money supply growth will sink to -2.8%!

There were just too many fascinating facts to repeat here. Make sure you watch the recording of Dr. Hunt’s presentation to hear it all.

Friday afternoon brings us Andrew Swan, Barry Potekin, Richard Smith, and Andrew Pancholi. I’ll report back to you Saturday morning on what they shared with attendees and LIVE Stream viewers.

If you’ve been unable to watch via LIVE Stream, or join us in Nashville, make sure you get your username and password for the Irrational Economic Summit 2017 Archive Kit. With it, you’ll have access to everything said and done at this year’s summit – on demand!

Until tomorrow morning then, reporting live from the Irrational Economic Summit 2017…

Teresa

P.S. Remember, whether you’re on the ground with us here in Nashville, or watching from the comfort of your own home (or office), talk to us. Ask questions, engage with your peers and us on our Facebook page or on Twitter.

You can email me at economyandmarkets@dentresearch.com

You’ll find our Facebook page here.

And our Twitter handle is @economymarkets.

For any social media interaction, use #iesnashville.

P.P.S. Thanks to Gary K. for his email yesterday. He wrote, “Harry Dent was excellent, as usual. Lots of charts and new information on live stream. I enjoyed Brendan Kennedy on legal cannabis also.”

 

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Categories: Economy