Paranoid billionaire or the trade of the decade? By James Sanders

Keith Neumeyer. Google him if you have the time but remember the name.

He thinks we are all in trouble and that the US dollar is headed for collapse,leading to a 'reset' with some assets soaring and others collapsing. He predicts 'riots' when the average person understands what's actually been going on. Scary stuff but Mr Neumeyer is not to be underestimated. He has a fearsome reputation Of course, even billionaires make mistakes and get trades wrong but when some one like Keith Neumeyer decides to make a stand, it's worth digging a little deeper(no pun intended).

Paranoid billionaire or the trade of the decade?

First,a couple of facts about Mr Neumeyer. He is the founder, president and CEO ofFirst Majestic, one of the largest silver mining businesses in the world. Hefounded his firm in 2002 and it is traded on the US stock market with a currentvalue of around $1.3bn. He is yet to cash out and sell a single share in the

business he founded.

“I'm abig bull on gold, I think we're going to see a major reset of the world... Insome of the upper circles, I think it's pretty well understood that the debt in the world is never going to be paid off.

We haveto have some kind of a major reset that's likely going to include gold... I've been quoted many times saying I expect to see triple digit silver, and that's assuming gold doesn't move. If gold goes to $10,000, then silver will be some ridiculous number... could even be $1,000.”

Gold iscurrently trading at $1,293 and silver is $17.15'Ithink there are going to be major revolts'''Negativeinterest rates are a way that governments are trying to tax the people. It'sgoing to start with big corporations that have a lot of cash sitting around in

banks and then it's going to trickle down to the average person on the street,the people that get hurt are the small investor, the people that can least afford it, the retired people that rely on their savings interest for a small income.

Theworld is changing, this is all changing, I think there's going to be a majorrevolt if we see negative interest rates in North America. We're going to seeriots.The Fedis losing credibility and with the talk of negative rates, people are lookingto gold now as a safe haven to be in as protection against major forces thatare occurring in the world.''

If youhad invested $10,000 in Keith's business when he started out 15 years ago, youwould have close to $1m today. To be clear, if he was just another Wall Streetbroker, analyst or banker, it would not be worth repeating his views here. Ofcourse, that doesn't mean he will be correct, even Goldman Sachs hit the stoplosses on all 6 of its ‘trades of the year’ in 2016, but more on those anothertime.

Hebelieves that the world is awash with debt that it can't ever hope to repay. Inhis view, central banks have pumped more money into a system that was alreadybroken. Fundamentally, the economy has stopped working properly and negativeinterest rates and asset bubbles are proof of this.

Paranoid billionaire or the trade of the decade?

He says there is only one way the current situation ends, and that is with debt being-written off and a new global currency mechanism being needed, one that may be part backed by gold. He calculates that to effectively wipe out all debt with anew gold backed currency requires a $10,000 gold price.

Neumeyeris certain that central banks, governments and investment funds know what iscoming and are preparing themselves already. He sees evidence of this in the current 'strength' of stock markets and the US dollar. Rather than a genuine economic recovery, he thinks the real reason the dollar is soaring is simply because Europe, Japan and China simply need weaker currencies, not to thrive,but to survive.

US policymakers recognize the downsides of a strong dollar but perhaps see that'taking one for team' (i.e. the global economy) as being better than widespread depression.

He notes that for the first time ever, central banks are quietly buying as much physical gold as they can, previously they were always sellers.China is thought to be targeting ownership of at least as much physical gold as the US, but calculating exactly how much the Chinese have hidden away in vaults has proven impossible. Conspiracytheorist? Paranoid billionaire? Maybe.

James Sanders is a successful business man who provides the help in property trading and business management in London.

The Best and Worst Job in the World – Being a Trader

When I was at school, they had a multiple choice assessment for all the kids when they reached the age of 13. It tested various skills and it’s aim was to give the students and their parents an idea of suitable careers they may wish to consider. At the time it was considered cutting edge and the ‘tests’ were viewed with trepidation for fear of being pigeon holed as a future chimney sweep, cobbler or window cleaner – no offence to any cobblers, cleaners or ‘sweeps that may be reading this.

The Best and Worst Job in the World

One job above all others was seen as ‘the job’, it was as if getting this profession selected as a potential career was in itself a huge boost and step up the slippery ladder amongst ones peer group. Ridiculous but true.

When the results were published, there seemed to be a year group full of mostly lawyers, marine biologists (not sure how that one was triggered), teachers, explorers and a select few that hit the jackpot - ‘commodities traders’. Of course, at the time, being a trader was all red Porsches, cocktails and braces. Open outcry trading was still in existence and it wasn’t necessary to have a degree to become one of this new breed of confident, arrogant alpha males. Fortunes were made and lost and it seemed that all you needed was confidence and ‘chutzpah’. In the early 1990’s, it felt as though being a trader was the quickest and most exciting way to become very wealthy, very quickly. It helped that traders appeared to flaunt their wealth more than equally wealthy lawyers, consultants and bankers. In many ways, not a huge amount has changed, as successful traders can still earn huge amounts of money and compared to other professions, it can be done quite quickly.

There are many different types of rader. Some risk their own money and work from home, others risk their firm’s money and are rewarded with a split of any profit. Others work for banks or funds and receive a salary and bonus dependent on how well they have performed. Of course there are a myriad of products that can be traded and most traders tend to stick to one product until they have developed a mastery, or as close to a mastery as possible, of that particular product. It is rare that you find a trader that can trade several products equally well, even though the rules and skills are pretty similar.

Other traders are not traders at all. They are ‘account managers’. They are not really ‘account managers’ either. They are salesmen. I used to employ many of these type of ‘traders’ and their job was to build relationships with their clients and give advice on the markets when required. They never traded their own funds and the trade ideas mostly came from analysts. Of course, if you give advice on the stock market, you can legitimately claim to be a trader I guess, but it’s worth noting all the different types as some have lots of brains and others just have lots of chat.

Most people become traders because they wish to back their judgement against others and be rewarded handsomely when and if correct. The best paid traders will be those that deliver the biggest profits and those will be the traders with the biggest credit lines and best information, research and lowest fees. It will also be the luckiest ones, as all traders need lady luck smiling on them occasionally, I assure you.

I have met a handful of traders that claim they enjoyed the mental challenge of trading against others in the market, but most of all, I think they enjoyed the way they were able to keep score of how they were performing during the challenge and you keep score by counting your money. It all comes down to money in the end. You live or die by your decisions and results, there are no excuses or explanations required – the result is binary. You win or you lose. That is very appealing to people with personalities that don’t have a high tolerance for BS.

The Best and Worst Job in the World – Being a Trader      

I see many training courses being marketed online and in print offering to ‘train people to trade and earn a fortune’ from the comfort of their own home. These courses claim they will reveal the ‘secrets’ of all successful traders and the courses tend to cost thousands rather than hundreds to attend once you have been lured into attending the first (free) session which is a series of hints and vague talk of these ‘secrets’.

Of course, there are no secrets and these courses and their marketing are cynical ways to take advantage of those most desperate to earn a good living. In fact, there are a handful of rules that every successful trader needs to stick to just to be in with a chance of making that fortune. I will share the most important ones now and they are simpler than you may expect.

-          Accept you will lose almost as often as you win

-          Be prepared to cut your losing trades and run your profitable ones

-          Don’t have opinions set in stone. Markets change and you need to be flexible

I will discuss these rules in more detail at a later date, but rest assured, only around 5% of traders can stick to them consistently.

Of course, in 2017, it’s less to do with personalities and chutzpah and chat have taken a back seat to technology and trading programs that execute thousands of trades in the blink of any eye. These trading algorithms are the present and the future, but if you can win more than you lose and keep your cool when others are losing theirs – you may still be able to make a fortune. But it won’t be easy.

James Sanders is a London based prop trader and investor who provide the help in property treading and business development.

If you are face any type of problem related to this topic, then you can directly reach out with our views. We would love to resolve it.