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The Secular and Cyclical Outlook for Stocks, Bonds, and Commodities. Since 2000 a “Lost Decade” For Investors… Are you Prepared for Another “Lost Decade?”. AAII San Francisco Meeting Saturday March 20, 2010 Presented by: Tom Kopas www.pringturner.com. U.S. Stock Prices. 2. 1. 3. 4. - PowerPoint PPT Presentation
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AAII San Francisco Meeting Saturday March 20, 2010Presented by: Tom Kopas
www.pringturner.com
Since 2000 a “Lost Decade” For Investors…
Are you Prepared for Another “Lost Decade?”
The Secular and Cyclical Outlook for Stocks, Bonds, and Commodities
1
2
3
4
www.pringturner.com Pring Turner Capital Group
19-years/69% decline/6 recessions
19-years/67% decline/4 recessions
16-years/62% decline/4 recessions
10-years/43% decline/2 recessions
www.pringturner.com Pring Turner Capital Group
www.pringturner.com Pring Turner Capital Group
19011929
1966
2000
1 5
6
7
2
3
4
15
6
7
2
3
41
5
2
3
41
2
3
4
Price Moves in Excess of 25%
Key Points: Secular Trend for Stocks
Long Periods of Alternating Good and Bad Performance
Secular Trends Change at Extreme Valuation Levels
Currently Halfway through our 4th Secular Bear Market
Be Aware of the Secular Bull Market for Commodities
Capitalize on Cyclical Stock Market Opportunities (Today)
Understanding Secular Environment is Key to Success
Financial markets are linked in a logical, rational, and sequential relationship to business activity. Financial markets have been tracking these business cycle sequences for over 150 years.
Pring Turner Investment Approach
www.pringturner.com Pring Turner Capital Group9
www.pringturner.com Pring Turner Capital Group9
Key Points: Investing Around the Business Cycle
Markets are Linked in a Logical, Rational, Sequential Relationship
For over 150 Years, Markets have Tracked Business Cycle Sequences
During Secular Bear Markets Economy in Recession More Often
Pring Turner Organizes the Business Cycle into 6 stages
Just Entered Stage 4 Good for Stocks and Inflation Sensitive Securities Bad for Bonds
Business Cycle Drives Profitable Asset Allocation Decisions
www.pringturner.com Pring Turner Capital Group910037854
(Inverted)
www.pringturner.com Pring Turner Capital Group
www.pringturner.com Pring Turner Capital Group
Inflation Barometer is at 100%.
www.pringturner.com Pring Turner Capital Group910
Key Points: Secular Trend Bonds/Commodities
Bonds Have Been in a Secular Bull Market for Almost 30 years
Bond Owners Beware: Secular Trend is at a Critical Juncture
Cyclically Bonds are Vulnerable to Interest Rate and Inflation risks
Small Rise in Interest Rates can Lead to Significant Losses in Bonds
Commodities in Secular Uptrend Adds to Risk in Bonds
Opportunities in Inflation Sensitive Securities
Tactics to Protect and Grow Wealth
Class Secular
Cyclical
Tactics
Stocks Bear Bull
Use Business Cycle to Tactically Allocate Assets
Inflation Themes are in Secular BullResourced Based, Foreign-Emerging
MarketsQuality with International ExposureIncome Producers
Bonds Bear?
Bear
Review and Reconsider RisksLower Bond AllocationReduce Bond MaturitiesSet up Short-term Bond LadderHedge Bonds with Inflation Sensitive Securities
Inflation
Sensitive
Assets
Bull Bull
Favor Natural Resource Companies“Chindia” Theme, Global Resource DemandPrecious Metal ExposureResource Based CountriesCanadian Royalty Trusts
March 2010
www.pringturner.com Pring Turner Capital Group
Thanks for Listening…
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