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The Dark Side of Student Loans
Issue #528, June 25, 2018

The Cost of Out-sourcing Convenience
Issue #527, June 18, 2018

Social Security: 66 or 70?
Issue #526, June 11, 2018

Student Loans: There’s (Unfortunately) a Lot More!
Issue #525, June 04, 2018

Co-signing a Note
Issue #524A, May 31, 2018

The Knight Frank Luxury Index and Collectables
Issue #524, May 28, 2018

The Importance of Diversification: The Myth of Diversification
Issue #523, May 21, 2018

How to Save Thousands on Your Food Bill
Issue #522, May 14, 2018

MoviePass and Other Things
Issue #521A, May 10, 2018

Degree Inflation, Long Training Periods, and “Certification”  Part III
Issue #521, May 07, 2018

Degree Inflation, Long Training Periods, and Certification” Part II of III
Issue #520, April 30, 2018

Follow-up on Several Things
Issue #519A, April 25, 2018

Degree Inflation, Long Training Periods, and “Certification”: Part I of II
Issue #519, April 23, 2018

The Kids Birthday Party Hustle
Issue #518A, April 18, 2018

A Pension Question: Part II of II
Issue #518, April 16, 2018

A Physician is an Executive
Issue #517A, April 11, 2018

A Pension Question: Part I of II
Issue #517, April 09, 2018

Is the Correction Over?
Issue #516A, April 05, 2018

Used Car Dealers, Student Loans, the Chinese, and Uncle George’s Rule
Issue #516, April 02, 2018

Starter Homes
Issue #515, March 26, 2018

Redecorating: Beware!
Issue #514, March 19, 2018

NASDAQ Closes at Record High
Issue #513, March 12, 2018

A 40% Chance
Issue #512, March 05, 2018

Several Things
Issue #511, February 27, 2018

Human Capital, Education and Wealth
Issue #510, February 19, 2018

Another Stock Market Update
Issue #509A, February 18, 2018

Some Thoughts on Savings
Issue #509, February 12, 2018

A Stock Market Upfate
Issue #508S, February 10, 2018

Who Can You Trust? Part II of II
Issue #508, February 05, 2018

The Christmas Decoration Pre-worn Jeans Hustle
Issue #Interim Bulletin #507A, February 03, 2018

2018 Outlook for Financial Markets
Issue #507, January 29, 2018

Who Can You Trust? Part I of II
Issue #506, January 22, 2018

Life Insurance Settlements
Issue #505, January 15, 2018

Commodities and Buying the Breakout
Issue #504, January 08, 2018

Buffett Wins His Bet
Issue #503A, January 04, 2018

Practice Real Estate and Free Agency
Issue #503, January 01, 2018

Outlook for 2018: Part III: Stocks and Bonds
Issue #502, December 25, 2017

My Outlook for 2018: Part Ii: Precious Metals
Issue #501A, December 21, 2017

Outlook for 2018: Hard Assets: Part I of III
Issue #501, December 18, 2017

More Thoughts on Bitcoin
Issue #500A, December 14, 2017

Fees and Good Relations with Bankers
Issue #500, December 11, 2017

Salvator Mundi
Issue #499A, December 07, 2017

Should You Rent or Own a Home?
Issue #499, December 04, 2017

A Gift Subscription
Issue #Interim Bulletin #498A, December 02, 2017

Stocks vs Real Estate: Asset Allocation: Part II of II
Issue #498, November 27, 2017

When Good Enough is Fine
Issue #497A, November 22, 2017

Stocks vs Real Estate: Asset Allocation. Part I of II
Issue #497, November 20, 2017

The Saudi Arrests and the Perils of Foreign Investing
Issue #496, November 13, 2017

Gambling and Las Vegas
Issue #495, November 06, 2017

Some Tips on Auto Insurance
Issue #494, October 31, 2017

Bitcoin and the Digital (Crypto) Currencies
Issue #493, October 23, 2017

The Coming Bear Market: Part II How to Prepare
Issue #492, October 16, 2017

Some Observations on Cemeteries
Issue #Interim Bulletin #491A, October 12, 2017

The Coming Bear Market: Part I: The Myth of Buy and Hold Forever
Issue #491, October 09, 2017

The Market makes New Highs
Issue #490, October 02, 2017

The Importance of a New High
Issue #489, September 25, 2017

A Little Insurance: Wealth, War and Wisdom
Issue #488, September 18, 2017

Some Observations
Issue #487, September 11, 2017

How to be Successful in Your Career
Issue #486A, September 07, 2017

How NOT to Buy a Home
Issue #486, September 04, 2017

This Week in the Market
Issue #485, August 28, 2017

Is the “Trump Bump” Running Out of Gas?
Issue #484, August 21, 2017

Gold is on the Move
Issue #483, August 14, 2017

The Importance of Estimation
Issue #482, August 07, 2017

Buying Art and Collecting: Part II of II
Issue #481, July 31, 2017

Buying Art and Collecting in General, Part I of II
Issue #480, July 24, 2017

Physicians need to be More Forceful: Follow-up
Issue #479, July 17, 2017

Physicians need to be More Forceful
Issue #478, July 10, 2017

Your First “Real” Investment
Issue #477, July 03, 2017

Leasing a Watch: Don’t
Issue #476, June 26, 2017

The Importance of Your Children having a Job
Issue #475, June 16, 2017

The Problem with Medical Student Debt is—the Med Schools
Issue #474, June 12, 2017

Critters and Varmints in your Home and Yard
Issue #473A, June 07, 2017

Leveraged ETFs
Issue #472, May 29, 2017

Leasing a Vehicle: Don’t!
Issue #471, May 22, 2017

Issue #470, May 15, 2017

More on Buying Jewelry
Issue #469, May 08, 2017

Buying Jewelry: Gold, Diamonds and Pearls
Issue #468, April 30, 2017

Thomas Sowell: Part III of III
Issue #467, April 24, 2017

Thomas Sowell: Pat II of III
Issue #466, April 17, 2017

Live Close to Where You Work
Issue #465, April 10, 2017

Medtronic in Hospital Management
Issue #Interim Bulletin #464A, April 07, 2017

Thomas Sowell: Part I of II
Issue #464, April 03, 2017

A Political Contribution a an Investment: Part II of II
Issue #463, March 27, 2017

A Political Contribution as an Investment: Part I of II
Issue #462, March 20, 2017

Buffett Selling Vacation Home
Issue #461, March 13, 2017

Advanced Placement (AP) ourses
Issue #460, March 06, 2017

The Importance of a Credit History
Issue #459A, March 02, 2017

A Credit Card Scam
Issue #459, February 27, 2017

The Electronic Health Reord
Issue #458, February 20, 2017

Issue #457, February 13, 2017

Platinum and Palladium
Issue #456, February 06, 2017

Economic Outlook for 2017: Part II of II
Issue #455A, February 02, 2017

Economic Outlook for 2017: Part I of II
Issue #455, January 30, 2017

A Story From Vegas
Issue #454A, January 25, 2017

Land Donation Deals and the IRS
Issue #454, January 23, 2017

The Theory of Gambler’s Ruin
Issue #453, January 16, 2017

Student Loans: But Wait, There’s More!
Issue #452, January 13, 2017

A Second Home
Issue #Interim Bulletin #451A, January 04, 2017

The Consumer Confidence Index
Issue #451, January 02, 2017


By Robert M. Doroghazi, M.D., F.A.C.C.

The Precious Metals

Issue #417, May 09, 2016

    To review: Gold and silver bottomed in 2001 at $255 and $4 respectively. They peaked in 2011 at $1,900 and $48 ($50 was the previous peak in 1980), then suffered a Hiroshima-like smackdown in April, 2013. They have been on fire since bottoming in mid-December at $1,050 and $13.60. GDX (an ETF of the largest miners, such as Barrick (ABX), Newmont (NEM), Randgold (GOLD) and Gold Corp (GG), and GDXJ (an ETF of the junior miners) were at one time up more than 100% and 130% from their recent lows. Is this just another false start, or have we seen the lows? Have the precious metals finally turned?
    The general timing is right. Commodity bear markets bottom about 5-6 years after the previous top.
    Major moves never just happen, they are always driven by fundamental factors. For the precious metals in the US, it’s the Dollar. The precious metals did well from 2001-2011 because of a bear market in the Dollar. When people are confident in paper (fiat) money, the precious metals are weak. Since 2011, the Dollar has been strong, and the precious metals suffered terribly. The last 4 months, the Dollar has weakened, and the precious metals, in fact, the entire commodity space, have done well.
    Likewise, nothing goes straight down or straight up. The precious metals are due for a rest. Anything, of course, can happen, but I think this is a very possible scenario. Gold, silver and the miners are due for a correction. The recent highs were $1,310 and $17.60. The metals could back off from here, or go a little higher, then correct, while the Dollar bounces from the 92-93 level. Note that the miners tend to lead the metals both up and down. The US Dollar then seriously breaks down, and the precious metals take off. If things unfold this way, this is when I’ll recommend you jump back in.
    At the Sohn Conference last week, Stanley Druckenmiller recommended you should be out of stocks, and noted that his largest “currency” position is gold. 
    Exxon Mobil (XOM) lost their AAA credit rating (with profits down, they are borrowing to maintain (increase) their dividend). The only US corporations to retain the coveted AAA rating are Microsoft (MSFT) and Johnson & Johnson (JNJ). In 2011, the US government lost their AAA rating.
    RMD comment: doesn’t anyone care anymore? We have lost our respect for and fear of debt. Debt is financial slavery. Your master says you will send a check every month, or suffer the consequences. There is no better investment in the world that the early repayment of debt. Thrift creates wealth, debt destroys wealth.
    Accumulate 12 Starbuck’s (SBUX) “Stars” and you get a free beverage or food item.
    RMD comment: Remember Top Value Stamps and S&H Green Stamps? Mom and Grandma Nagy were big into Eagle Stamps because Famous-Barr gave them. One stamp for every 10 cents of purchase. You then put them in a book at 50 per page. I don’t remember the exact # of pages in a book, probably 20 (represented $100 purchase. Remember, this was the 50s and early 60s. That was a lot of money). I well remember that a whole book was worth $2.50 in merchandise. At Famous and the other stores that took them, they were as good as money. The ladies at the counter wore rubber fingers so they could go through the books quickly to make sure all of the spaces were filled.
    The “Stars” are really just a form of loyalty points. Starbucks is a smart outfit.
    Amazon (AMZN) CEO Jeff Bezos sold 1M shares, about 1% of his stake, for $671M.
    RMD comment: there are many reasons an insider buys stock, but there is only one reason they sell: because they think it is going lower. Add in that AMZN is up about 130% since Feb. of 2015, and that almost all of the proceeds of Bezos’ sale are presumably taxable, and it doesn’t paint a bullish picture. 
    This is from a long-time subscriber re: long training periods.
    “It is no small irony that training and recertification requirements for physicians are being raised at a time when there is a movement afoot to hand over increasing amounts of authority to lesser trained professionals. How do you tell someone contemplating a career in General Internal Medicine they will need to undergo 11 years of training (4 years of college, 4 years of med school, and 3 years of Residency), certify for Internal Medicine and recertify every 10 years, and undergo increasing CME requirements, while at the same time a Nurse Practitioner or PA will be considered to have a comparable skill set?”
    RMD comment: Very interesting point. My series of 5 Commentaries in The American Journal of Medicine on “Negative Secular Trends in Medicine” looks at things from the top end: losing the smartest kids in the class, who can do whatever they wish. This suggests that those at the lower end of the earnings spectrum are also at risk.
    In fact, a previous study has shown that, considering the length of training required and the time cost of money, it is a better investment to be a Physician’s Assistant (PA) than be in the lower earning half of General Practitioners, a sorry state of affairs for females, since they represent most of the lower earning physicians.
    See:  Doroghazi RM. Negative Secular Trends in Medicine: Summary. Am J Med. 2016;129(5):459-460.   
    Your hospital or med school librarian can download the article for you. If this is not an option, feel free to contact Boone Hospital librarian Judy Feintuch at .(JavaScript must be enabled to view this email address)  There should be no charge to you for this.     

    1) Join AAA. Almost anything associated with travel offers a discount. Just ask: you will be very surprised. Many hotels offer a discount. The main parking lot at Lambert St. Louis Airport offers a AAA discount. It is very likely you will receive enough discounts to cover the membership fee. In the end, you receive the road service for free. That provides a lot of comfort.
    2) Join your local University Club: they have reciprocity with 100 or more U. Clubs around the US. Ex: joining the U. of Missouri Reynold’s Club has allowed me all of the privileges of the Quadrangle Club at the U. of Chicago. I have also had dinner at several otherwise exclusive University Clubs around the US.
    3) Ditto for your local Art Museum. They often have reciprocity with other museums. You’ll save on admission, and receive a discount on purchases at the museum shop. 
    These are the kinds of things you won’t see elsewhere, yet they’re simple, and over the long run, will save you far more than the cost of this newsletter. 
    Warren Buffett said put your money in the mattress if banks charge for deposits.
    RMD comment: negative interest rates are an abomination. You bust your chops, save your money, and then have to pay the bank to hold it. Ridiculous. In fact, if rates go negative in the US, I wouldn’t be surprised if Berkshire Hathaway (BRKB) wouldn’t outperform the market. After all, who better to trust your money than Warren Buffett.
    Several years ago Carl Icahn called Apple (AAPL) a “no-brainer” and said it was going to $240. It was revealed last week that Icahn has sold his stake in AAPL (at least in part because of what’s going on in China).
    RMD comment: This is not a negative comment on Icahn. Rather, it is to remind you that people talk their own book: It’s up to you not to be seduced by such comments.

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