The SWAN Strategy:
A Conservative Way to Beat the Market
and Earn High Income in 2019.
“A bull market is one that can shake off
even bad news.”
– Don Gimpel
Bull Markets Are Lasting Longer
Why Are the Bulls Winning?
Possible Reasons:
• The economy’s shift from manufacturing to
services, which are less cyclical
• The increasing demand for stocks in the face of
share buybacks and a secular decline in the
number of publicly traded companies
• The gradual decline in interest rates
• The Fed’s willingness to step up and prevent a
bear market (or crash) from becoming a full-
scale depression (referred to as the “Fed put”).
“Ye Shall Prosper in the Land:
Three Financial Lessons from the Bible”
by Mark Skousen Editor,
Forecasts & Strategies
Presidential Professor,
Chapman University
www.markskousen.com
In honor of next weekend:
Why the Jews don’t feel guilty
about money and Christians do?
Abrahamic Covenant “Abraham shall surely become a
great and mighty nation, and all the
nations of the earth shall be
blessed in him.
“Because that Abraham obeyed my voice, and kept my
charge, my commandments, my statutes, and my laws.”
Genesis 18:18, 24:35, 26:5.
“And the Lord blessed Abraham in
all things. And he has given him
flocks, and herds, and silver, and gold, and menservants
and maidservants, and camels, and asses.
The Prayer of Jabez
“Jabez was more honorable than
his brothers. His mother had
named him Jabez, saying, “I gave
birth to him in pain.” Jabez cried
out to the God of Israel, “Oh, that
you would bless me and enlarge
my territory! Let your hand be with
me, and keep me from harm so
that I will be free from pain.” And
God granted his request.
‒1 Chronicles 4:9-10
Benjamin Franklin’s favorite proverb
“Seeth thou a man diligent in his business?
He shall stand before kings.”
– Proverbs 22:2
Anti-Wealth Statements in the New Testament
“Jesus said unto him,
If thou wilt be perfect,
go and sell that thou
hast, and give to the
poor, and thou shalt
have treasure in
heaven: and come and follow me.
“But when the young man heard that saying,
he went away sorrowful: for he had great
possessions.” ‒ Matthew 19:21-22
St. Paul and Riches
“And having food and raiment
let us be therewith content.
But they that will be rich fall
into temptation and a snare,
and into many foolish and
hurtful lusts, which drown
men in destruction and
perdition.
“For the love of money is the root of all evil: which wile
some coveted after, they have erred from the faith, and
pierced themselves through with many sorrows.”
– 1 Timothy 6:8-10
#50 “The Sermon on
Wealth”
or “The Use of Money”
(1843)
1. Earn all you can.
2. Save all you can.
3. Give all you can.
John Wesley, 1703-1791,
Founder of the
Methodist Church
“Capital is Protestant.”
– Montesquieu
Highlights: Jacob Fugger, John Wesley,
and Ben Franklin
Benjamin Franklin (1706-1790)
Franklin’s Three Virtues:
Industry, Thrift, Prudence
“The way to wealth, if you desire
it, is as plain as the way to
market. It depends chiefly on
two words: industry and
frugality.”
“Nothing but money is sweeter
than honey.”
“An investment in knowledge
always pays the best interest.”
“Economy is a great source of
wealth; No revenue is sufficient
without economy.”
“A fool and his money are soon
parted.”
American Exceptionalism
I, in my own mind, have
always thought of America as
a place in the divine scheme
of things that was set aside
as a promised land...Any
person with the courage, with
the desire to tear up their
roots, to strive for freedom, to
attempt and dare to live in a
strange and foreign place, to
travel halfway across the
world was welcome here. Ronald Reagan,
1911 - 2004
The Triumph of the Optimists
World stock markets 1900-2000. Source: “Triumph of the Optimists” (2002)
Wall Street Outperforms Since the Financial
Crisis of 2008-09: America vs the World
My Favorite Way to Beat the Market
Dividend-Paying vs. Non Dividend-Paying Stocks
4763
2546
3354
4167
3727
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
Jan
-79
Jan
-80
Jan
-81
Jan
-82
Jan
-83
Jan
-84
Jan
-85
Jan
-86
Jan
-87
Jan
-88
Jan
-89
Jan
-90
Jan
-91
Jan
-92
Jan
-93
Jan
-94
Jan
-95
Jan
-96
Jan
-97
Jan
-98
Jan
-99
Jan
-00
Jan
-01
Jan
-02
Jan
-03
Jan
-04
Jan
-05
Jan
-06
Jan
-07
Jan
-08
Jan
-09
Jan
-10
Jan
-11
Gro
wth
of
$100
Returns of Russell 1000 Stocks by Dividend Policy, 1/31/1979 - 6/30/2011Monthly cap-weighted geometric average of total returns of R1000 component stocks
Div Growers Div Cutters Non Div Payers Div Payers Russell 1 000
Rising Dividends Lead to High Total Return
Rising dividend stocks and funds.
Lowell Miller’s formula:
“investing with peace of mind.”
High
Quality
Growth
of Yield
High
Yield High Total
Return
+ = +
Main Street Capital (MAIN)
MAIN Outperforms S&P 500 Index and Warren Buffett
The Gain in Main is Simply Insane!
Vince Foster,
founder and
chairman of MAIN,
will speak at this year’s FreedomFest,
July 17-20, Paris Resort, Las Vegas
www.freedomfest.com
Omega Healthcare (OHI)
Enterprise Products (EPD)
Microsoft (MSFT)
Flying Five Performance Since 2009
(August to August)
Looking back since 2009, the 30 Dow average is ahead 190%, but the Flying
Five has almost quadrupled its value, up 387% (including dividends for both).
Year Dow 30 Flying Five2009-10 + 9% + 19%
2010-11 + 19% + 28%
2011-12 + 5% + 18%
2012-13 + 26% + 29%
2013-14 + 13% + 21%
2014-15 + 7% + 7%
2015-16 + 9% + 26%
2016-17 + 10% + 10%
2017-18 + 16% + 20%
2018-19 + 6% + 19.1%
Flying Five Stocks
Every August, buy the five highest yielding,
lowest priced Dow stocks
Current recommendations:
1. Cisco Systems (CSCO)
2. Pfizer (PFE)
3. Verizon (VZ)
4. Coca Cola (KO)
5. Merck (MRK)
“Dividends are the
critical factor giving
the edge to most
winning stocks in
the long run.”
‒ Jeremy Siegel
Warning to Income Investors:
Beware of Panic Selling
At FreedomFest 2013,
Las Vegas, USA
“Everyone is a disciplined, long-term
investor until the market goes down.” ‒ Steve Forbes
“The big profits go to the intelligent,
careful and patient investor, not to the reckless and overeager speculator.”
‒ J. Paul Getty,
“How to Be Rich”
Profits
“Do you know the only thing that gives
me pleasure? It is to see my dividends
coming in.”
‒ John D. Rockefeller
Dividends
Maxims of Wall Street,
$20 for first copy,
$10 for all additional copies.
Free with subscription to F&S for $99.95…
Warren Buffett's
Favorite Quote
Book
"It's amazing the depth of wisdom one
can find in just or one or two lines from
your wonderful book. I keep it on my
desk and refer to its for daily wisdom."
‒ Dennis Gartman
“The world’s largest gathering of free minds.”
Kevin "Mr. Wonderful" O'Leary
Shark Tank
The Big Debate
John “Austin Kid" Mackey
Whole Foods vs.
Conscious Capitalism Pure Greed
www.freedomfest.com
CAN MONEY BUY HAPPINESS?
Hello green, goodbye blues
A study found a
satiation point
around $75,000
for an individual.
While emotional
gains disappear
after that, gains
in life evaluation
continue.
Money may be the husk of things, but not the kernel.
It gives you food, but not appetite.
Medicine, but not health.
Acquaintances, but not friends.
Servants, but not faithfulness.
Days of joy, but not peace or happiness.
‒ Henrik Ibsen