Rachel’s note: On Saturday, Phil went on record with more details about how he forecasts the markets than ever before.
He broke down his strategy – using the “Gann Money Almanac” – to show how he’s helped readers navigate the twists and turns in the markets for 30 years.
If you missed it, you can still watch it until midnight tonight… check it out here.
This vital aspect of understanding my 18.6-year real estate cycle goes like this.
…Please prepare yourself…
Because the reality is, the cycle won’t turn until everyone is completely and overwhelmingly all-in and soaked in debt.
And that’s your first sign that things are about to come to a shuddering halt.
You’re not alone. Millions are trying to make sense of the same situation… but if you know about the cycle, you’ll be ahead.
It works both ways.
My unique research has allowed me to advise my readers that the likelihood of a major market crash involving the stock and land markets in the U.S. and globally is remote.
The history of the real estate cycle says it’s not going to happen anytime soon.
Another reason was this.
It’s the enormous amount of money, both private and public that has sat on the sidelines ever since the 2020 covid lockdown.
It has been sitting there because investors like you are near retirement… you’re worried… you’re not going to use this money to buy a boat or go on an impulse trip to Italy.
Things are fine…
They are hardly suggestive of an imminent “all-in” phase of economic activity, right?
Well, the evidence I see tells me this is about to change. Quite dramatically.
The Cycle Peak Is (and Always Will Be) Expected
Should history once again repeat, then it strongly suggests that it will be emerging markets that outperform during the second and more speculative half of the current real estate cycle.
In an ironic twist, it’s very likely this trend will occur again because of the state of international relations.
In particular, the two biggest elephants in the room – China and the United States.
Both are engaged in multifaceted diplomatic, military, and trade disputes, which will ultimately make them both poorer.
The biggest issue here, though, is one of unintended consequences.
Let me explain…
Bloomberg recently ran an article detailing the news concerning the United Arab Emirates (UAE) and its sovereign wealth fund, the world’s largest.
Source – Bloomberg
When I see “sovereign wealth”… I replace those words with “economic rent.” A more accurate summation of where its money originally came from.
The person in the above image is Sheikh Tahnoon bin Zayed Al Nahyan, a member of the ruling Royal family of the UAE. He has gained control of the largest sovereign wealth fund in the United Arab Emirates, expanding the assets he oversees to almost $1.5 trillion USD.
He’s proceeded to bankroll billions of dollars in deals via an expanded empire of private and state entities. He has sought to invest in everything from technology to finance, with varying degrees of success.
In other words, billions of dollars are coming into economies and businesses. If the world really was entering a sustained recession, this would not be happening today.
He is, however, running into a few problems. Earlier this year, this fund tried unsuccessfully to buy Standard Charters and Lazard Ltd. in the U.S.
The U.S. Committee on Foreign Investment now conducts more stringent checks on deals by international investors with business ties to the Chinese government.
You see, the UAE is set to join the expanded BRICS grouping of major emerging markets.
And the major power in the BRICs nation is, of course, China. See now why the two elephants’ insistence on headbutting each other causes unintended consequences?
While they fight, third parties prosper. The battling sides may not, but this is where we follow the money.
It’s Easy to Know Where to Put Your Money
Folks, it’s time to rise above this nonsense and start viewing the world through the lens of the 18.6-year real estate cycle.
I expect the best-performing economies for the remainder of the decade to be emerging ones… Which indicates to me a rich tapestry of opportunities for astute investors.
The clues are everywhere if you know where to look and how to interpret them.
The Bloomberg article itself sums it up very well:
Such added pressures come at a time when Sheikh Tahnoon’s investment vehicles are showing a particular affinity for emerging markets… the fund is building teams in Asian cities, including Shanghai, to scout for investment opportunities,
Meantime, his private investment firm Royal Group has long prized India, which executives there have called the potential growth engine of the next decade, people familiar with the matter said.
Again, that’s $1.5 trillion USD worth of potential investment from this one fund.
The peak of this cycle will surpass all before it… those who are prepared will see their wealth grow… and those who aren’t may not recover.
Editor, Cycles Trading with Phil Anderson
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