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    Bluemound Asset Management A Kirk Spano company

Top 2 Investing Rules…

Kirk SpanoRule No. 1: Never lose money. Rule No. 2: Never forget rule No. 1.  

Warren Buffett

The most important aspect of financial planning is having an investment approach that protects you from permanent loss and gives you an opportunity to make money over the long-term. Industry statistics demonstrate that most financial people fail in both regards. Your financial representative should understand investing at its core, not just be able to show you a pie chart, use industry jargon and provide deceptive mutual fund ratings.

At Bluemound Asset Management we focus on Buffett’s top two rules daily. My name is Kirk Spano and I am the founder of the firm. I am easy to follow online. Please read some of my articles and notes to help filter the noise in the markets and verify the sound advice I have given over the years. When you are ready, contact me to discuss building a better plan and securing your future.

Time for a Change

Bluemound is a fee-only investment advisor.

We have a simple, smart and low-cost fee structure. 

We receive no commissions for making transactions.

You get a caring team and access to some of America’s true financial leaders.

Learn more, call us today: 

855445-4321

Kirk Spano Financial Network

Work with me anywhere in America. I have developed relationships nationally that will allow you to benefit from the same ideas that I write about, discuss on radio and present in public forums.

By working with my network, you will get the value of two (or three) heads for the price of one.

We will give you the dependable service and guidance you need to find the peace, freedom and security you are looking for.

Learn more about working with me and my carefully selected network of financial leaders.

The Developing New Prosperity

Special Letter: December 2011

The Developing New Prosperity

While headlines like the one above are generally met with retorts about America’s demise, this letter hopefully makes people understand that the United States is in the beginning stages of a new boom, not a final collapse.  As I discussed on MarketWatch.com in the article that won me a columnist slot with them, America is in the very early stages of a technolution in energy that will not only provide jobs for the millenial generation but also pay for the baby boomer’s retirement.  On top of energy, food production and export is becoming an increasingly strong strategic industry.

Energy Is The Key to Every Economy

Since the industrial revolution, cheap energy has been at the heart of America’s economic development.  And since the 1950s, having energy has been the core factor in the United States dominance of the world economy.  Going forward, energy, will continue to be at the heart of the American economy and its continued place as the most important economy on earth for decades.

Nations that are energy rich have stronger currencies, and generally higher standards of living.  This relationship is easy enough to understand by experience.  If your money is worth more, you can buy more, hence you live better.  If you have a relatively low cost of energy, the core ingredient in virtually everything in moden life from production of goods to transportation to the temperature of your home, everything else tends to fall into place.  A strong currency is one of the three main things that keeps inflation low (resources and high productivity being the other two).

A recent Goldman Sachs report projected that the United States would be a net energy exporter by 2017.  While precision isn’t important to us here, the accuracy of the trend is.  What we have seen via Energy Information Agency (EIA) numbers is that oil imports from the middle east have plunged the past four years, oil production in the United States has surged (even with the slow down in the Gulf which is now picking up again), natural gas production is ramping up, coal production and export is robust, solar netted billions in exports the past few years and is about to make another technological jump, wind is reaching physical peaks and broad energy efficiency is helping the U.S. maintain demand levels. 

On net, supply of energy in the U.S. is rising faster than the demand.  Globally that is not true.  The U.S. is very early in developing an energy export economy.  Think about the opulance that has been built in the middle east selling the United States energy.  Now imagine the wealth that can be generated for the United States selling our energy to Europe, Japan, China and developing nations.  It is massive.  

Food Is Pretty Important Too

While not America’s largest export, as it trails both chemical and transportation exports (folks, we are still a top 3 exporter in the world), agriculture is a major and growing component of American exports.  At $122 billion in 2010, food and agriculture exports are growing at a low double digit percentage as the world keeps creating more mouths to feed.  The United States combination of arable land, water, agricultural technology and low population make for a potent mix for the development of further exports and generation of domestic wealth.

Balance

Americans as a group have been fairly pessimistic of late.  That is understandable.  The period from 2001 to 2008 was terrible for America, and the past few years the hoped for rebound has been slow to materialize. 

The facts are however that things are slowly getting better.  Jobless claims have been falling recently.  This may be attributable to the fact that exports are rising.  Regardless, the broader economic trough, in my opinion, has been made.  We may skip along in a near sideways way for a few more years, but folks ought to be working towards participating in the coming boom, because it is coming.

As trends play out over the coming decades, so long as we protect the environment and make certain that the wealth generated by energy and food exports are not hoarded by only a few, America is on track to do very well going forward.  All we have to do is work hard (which will require learning appropriate skills) and control cheating through appropriate regulation, and America will have a postive social evolution, not the collapse that fear sellers drone on and on about.

Investors

Investors need to resist the urge to be pessimistic.  They must also be patient and resist the urge to bury their portfolios in low growth, low return investments because they are afraid of volatility.  Volatility works in both directions.  Portfolios that have been built for the coming positive future, like ours have been, need to stay the course.  Those who do not have portfolios leveraged to a stablizing dollar brought about by energy and agriculture strength in America need to do so.

Your Positive on the Future of America Advisor,

Kirk Spano

 

This letter contains forward looking statements that may not come true.  Past performance does not guarantee future results.  This letter is intended for informational purposes only, and reflects only my thoughts and opinions in general, and do not constitute individual advice.  Opinions expressed may change without prior notice.

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Tactical Asset Management

The best offense is a great defense.

Tactical Asset Allocation

Are you utilizing the appropriate defensive strategies for your portfolio? Today’s economic climate and financial markets require strong risk management.

Tactical asset management using low cost ETFs (Exchange Traded Funds) and a multi-layered quantitative analysis of the markets can protect you against much of the downside of markets while allowing participation in the upside.

An easy way to understand this approach, which is different than what 90% of the industry is doing, is that we are not trying to predict the future. Rather, we are using low cost index funds to participate in the market’s upside and  getting out quickly when the markets start to move downward — which we can do by using sophisticated mathematical analysis.

Think of it as coming in from the rain while it is still a drizzle before the downpour occurs. You will still get a little wet, but you are not soaked. Similar approaches have been used by some of the best hedge fund investors for decades. Bluemound works with some of the best people in the industry to help our clients stay dry.

Learn more about how including our Tactical Asset Management programs in your portfolio can help protect your retirement.

Family Wealth Management

“For all your days be prepared, and meet them ever alike.” Markham

Families with seven and eight figures of wealth have special long-term financial and estate planning needs.

Kirk can lead you through a volatile world, manage life changes and help make your long-term vision reality. 

Learn more about our family wealth management services.

Legacy

Retirement Plan Monitor

Your retirement plan at work — 401(k), 403(b), 457 — is a major part of your future. 

Managing the fund choices in your plan is not easy. Our simple and low cost tactical approach is the solution.

Learn more about securing your retirement.

401(k) Design & Fiduciary Services

The Pension Protection Act has made 401(k) sponsorship more complex and dangerous.

Department of Labor audits are becoming more common and costly.

Learn how we can improve investment outcomes and reduce fiduciary liability.

Evaluate charities here.

Kirk Spano at MarketWatch

Kirk Spano’s views have been recognized and sought after nationally. He writes for MarketWatch of the Wall Street Journal network, has appeared on television — including Fox Business, is a regular radio guest, has authored articles for multiple publications and has two books in development. He also publishes the American Resource Boom Letter.

Boomers Rock Radio

Mr. Spano regularly appears on the Boomers Rock Radio Show with host Tom Matt. Boomers Rock is focused on baby boomer issues, including finance, wellness and fulfillment.