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Craig Brockie
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Craig Brockie is a contrarian investment advisor in Beverly Hills, who provides wealth management services to high net worth clients. He prefers to bill his clients solely based on performance, getting paid only for results.
My company:
Contrarian Advisors
My blog:
Contrarian Investing News
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  • Glendale's Sterling Management Ready For Any Market

    I recently met with Kevin Wilson of Sterling Management in Glendale, California. One of the topics we discussed was the state of the economy and investment markets.

    As I've outlined in several past articles, I believe this is the final year in the bull market which began in March of 2009. Over this time, the stock market has tripled in value and is more dangerous than ever today in my opinion. Those who lost money in the 2008 financial crisis, when the real estate bust, or when the dot-com popped would be wise to sell high--immediately.

    Sterling Management helps businesses in several professional fields such as doctors, dentists, and accountants, boom their businesses. As a result, they have their ear to the ground more than most people. They are keenly in tune with how things are going in the real world when it comes to business.

    When a downturn in the economy is expected, as it is today, it is important to increase promotion ahead of time to make sure that revenues are sustained throughout the difficult period that follows.

    When managing a business based on statistics, which Sterling emphasizes for their clients and in their own company, the CEO and other key decision makers can accurately identify trends. This allows them to take appropriate actions to capitalize on opportunities and correct problems quickly. Too many business owners fail to apply statistics and hold themselves and their staff accountable for production. They tend to operate based on how things appear to be or intuition alone. This is the downfall for many companies.

    Among the topics we discussed, Kevin and I were in agreement about how the real estate market was again peaking and how reducing one's exposure to real estate and risk assets in general was a wise action to take right now.

    One thing that really caught my attention in our discussion is when the topic of commercial real estate in Glendale came up. Currently there is no shortage of vacant commercial space to rent, yet it's a seller's market for building owners. This is obviously an unsustainable condition that will not end well for those who own commercial real estate in Glendale, or most parts of the US where these same conditions exist.

    Of course, dropping prices for financial assets will not bode well for the economy in general. Upper management of any publicly-traded company should be thinking about how they will promote and sell their products over the next 2-3 years as the investment markets bottom. Investors on the other hand need to be aware that just like in late 2007 when I issued my last major market warning, it really is critical to "sell high".

    If your financial advisor failed to warn you to sell near the previous all-time highs in 2007 or 2000, chances are they won't warn you this time either. In fact, if they haven't advised you to reduce your risk by now, there's reason for concern. It's up to you to take charge and ensure that you avoid becoming road kill yet again. If you still subscribe to the philosophy of "buy and hold", you are in the path of destruction yet again. It's far wiser right now to simply step aside with your investment capital.

    Oct 09 8:26 PM | Link | Comment!
  • Gold Price Manipulation Or The Makings Of An Epic Rally?

    Today I'm going to share a special treat with you, which you'll find towards the bottom of this update.

    With summer coming to a close, the investment markets have been presenting some interesting opportunities.

    The bull market in US stocks and bonds appears to be reaching exhaustion as the index of smaller companies (represented by the Russell 2000 index) has failed to follow the big boys (represented by the S&P 500 index) to new highs. It appears to be 2007 all over again.

    Meanwhile, the gold and mining sectors have been shaking out uncommitted investors and frightening even the most die-hard gold bugs. This is despite gold and mining funds being some of the top performers this year. In fact, gold miners are setting much higher lows right now...30% higher in the case of junior mining fund, GDXJ.

    This is the pullback in the gold mining industry that I have been patiently waiting for. I have been buying GDXJ and related funds for my clients the past few days and have orders to buy more should we experience further weakness.

    With so many pre-2008 warning signals present today and with the S&P 500 index finally above the memorable level of 2,000, I have finally begun buying the short-selling fund, HDGE. The reason why 2008 was such a successful year for my clients and me is because we were shPrepare for the Bear Marketort the market.

    I estimate that most mutual funds that the general public are currently holding have 5-10% (max) upside potential in the very short term and 50-60% downside risk over the next couple of years. This is similar to before 2008 when the S&P 500 index continued grinding higher for a few months after the Russell 2000 had peaked and then went on to plummet 57%.

    On the other hand, I estimate that the short-selling fund, HDGE has 50-60% upside potential over the next two years and 5-10% downside risk should the markets become even more irrational over the next several weeks. Clearly the odds of success are much better being short the market right now.

    Now, let's talk about gold and commodities. After hitting multi-year and in some cases all-time lows by some metrics, gold mining stocks have been among the best performers this year. In 2008, prior to the last collapse, commodities were the hottest investments, peaking several months after the S&P 500 index. Things are setting up to be the same again this time.

    Of course, like in 2008 we will need to sell ALL of our stock funds, even the gold mining ones, before the ultimate collapse. That said, the bear market is just beginning and like all past bear markets, it is likely to take up to two years to finally bottom.

    While my colleague and good friend, Steven Jon Kaplan disagrees, I believe that the markets are carefully "managed." There has been clear evidence of outright manipulation in both the gold market and the general stock market over the past year and half.

    In my opinion, the only thing that could prevent gold mining stocks from doubling or more from today's levels is manipulation. If the powers that be can keep the lid on this market for another year, they will have successfully prevented gold from participating along with the overall bull market in commodities and emerging markets, which I expect to rage into 2015.

    According to a report in the Financial Times, gold market manipulation was described as routine. While I've also written about this subject in the past, you can find the complete, unabridged history of gold price manipulation here.

    Although it seemed that the downward price manipulation in gold was behind us, it appears to have resurfaced again recently. This recent article shows that manipulation is still alive and well in the gold market.

    It will be interesting to see how things play out over the next year. I suspect that gold miners will rally along with the rest of the commodity bull market and make up for "lost time" by increasing more in percentage terms. Time will tell though. It's never wise to have all of one's eggs in one basket and this holds true for gold mining stocks.

    Now, I want to give you the treat I mentioned at the beginning of this update. Another contrarian colleague of mine, Jesse Stine has published a recent newsletter that I think you'll enjoy. Jesse successfully turned $46K into $6.8M in just 28 months, so he knows a thing or two about investing to say the least.

    Jesse went on the record at the beginning of this year, correctly predicting that commodities would finally break out of their bear markets and become star performers. He and I were certainly on the same page about this, along with my associate, Steven Jon Kaplan.

    Today I'd like to share with you Jesse's latest newsletter. It is titled, "Stuff" (think commodities) and you can find it right here.

    By the way, this is a free newsletter service from Jesse that you too can sign up for. I highly recommend you do. Here's the link to subscribe.

    That's all for today. Until my next update...

    Flourish and prosper,
    Craig Brockie - Registered Investment Advisor
    Contrarian Advisors - Rational Wealth Management
    Phone: 1-800-996-4657 - Email:
    Address: 433 North Camden Drive, Sixth Floor, Beverly Hills, CA 90210

    P.S. Did you lose money in 2008? We didn't. If your financial advisor didn't warn you prior to the 2008 financial crisis and hasn't said anything by now, then it's up to you to make sure that doesn't happen again. Click here to qualify for a free initial consultation.

    PPS. Thank you for sharing this information with others. To receive updates like this one by email, subscribe to my own free newsletter service here.

    Sep 09 3:20 PM | Link | Comment!
  • Joan Perry Of Los Gatos Pens Financial Book

    As a contrarian investor and registered investment advisor, sharing my insights as to what's going on in the markets is definitely my top priority.Joan Perry of Los Gatos

    Ever now and then though, I like to write a post about someone related to the finance industry. Today, I'd like to introduce you to Joan Perry of Los Gatos. Joan is the author of a great book titled, "A Girl Needs Cash: How to Take Charge of Your Financial Life."

    The book summary states: "The easiest way to lose control of your life is to lose control of your financial life. Joan Perry's spectacularly successful Wall Street career shielded her from that truth--until a failed love affair and a lost nest egg jolted her into rethinking her priorities and then acting on them. Today Perry helps women gain control of their money and their lives by building long-term financial well-being through smart investing."

    I think this is an important book since financial education is missing from our school systems. I'm a big fan of Robert Kiyosaki and his financial learning materials. My sons and I love playing their board game, "Cashflow" that teaches financial intelligence in an entertaining way.

    Furthermore, finances have traditionally been the responsibility of men, so having a book tailored to women is great in my opinion.

    I've had the opportunity to speak to Joan Perry a few times now and am impressed with her experience in regards to the investment profession.

    In her book, Joan Perry shows you step by step how to review your spending habits and develop new sources of income to create the kind of life you want to live--now and well into your future.

    Perry also shows how to build a personal "money machine" to generate real cash flow with the right investment choices for you--stocks, mutual funds, real estate--and understand the tax choices that affect your cash flow.

    These are concepts that every investor should understand, especially since taxes can play such a significant role in any transaction.

    So if you are a woman looking for practical information about investing, or you looking for a dynamic speaker in Los Gatos or the San Jose area, I highly recommend getting in touch with Joan Perry.

    Aug 21 8:41 PM | Link | Comment!
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