During my visit to Singapore in 2007, I managed to stroll into a bookstore (yes, those things still exist in real life). Now because I read the Holy Bible, when I saw a book titled “The Joseph Cycle” I was curious… why would something like that be in the investment section of the bookstore. The title was inspired by Joseph, the Biblical figure who was summoned to interpret a disturbing dream of the Pharaoh of Egypt. Turns out this book has really made an impact on the way I think now. This book was written in 2004 and predicted the 2008 crash as well as the tipping point, you guessed it… the Beijing Olympics. Coincidental?
Those who don't learn from history, are bound to repeat it.
The Joseph Cycle by Simon Sim is a theory. Through his research on long-term cycles, he discovered the oldest business cycle recorded in the Holy Bible, under the book of Genesis, wherein Joseph (the son of Jacob aka Israel) prior to becoming the Pharoh's right hand, interpreted dreams. One day, the Pharaoh of Egypt had two dreams. In the first, he dreamt about 7 fat cows grazing grass and then the 7 lean cows devouring the 7 fat cows. In the second, he dreamt about 7 full ears of corn and later, the 7 thin ears of corn swallowing the full ones. He also knew each dream was related to the other and so being worried, he called all his ministers with a warning to interpret the dream without fail. The G-d given chance came upon Joseph who was wrongfully imprisoned under the Pharoh's reign to interpret… and this is what he said:
…there will be seven years of feast in all the land of Egypt. After that there will be seven years of famine…
To learn what happened to Joseph afterwards, read the rest of the book. Simon Sim uses this story as the context for his theory about how our world follows a 7 year famine and 7 year feast trend or 14 year cycle. Simon used the Singaporean Straits Times Index as a reference point, he started with 1959 when Singapore achieved independence and also regarded by him as the bottom of a cycle, he counted in cycles of 14 years, with 7 years of bull (peaks) and 7 years of bear (troughs) runs, accompanied with major economic events. With that starting point, he pointed out the following tops and bottoms…
Who is Simon Sim…
Never heard of him? Well, he's no quack looking at Chinese Zodiac and other astrophysical crystals. He's the former Head of Technical Analysis with the Union Bank of Switzerland (1985-1998) aka UBS. He's been a Technical Analyst since 1979. Now Simon does give a warning, he says you won't notice a perfect bull or bear movement, but the overall trend does follow the cycle. If you recall in my last article about the Fat Lady Singing… you'll notice that while the US Stock Markets have been going up (thanks to the inflationary printing press of the Federal Reserve), the general world trade represented by shipping cargo movements hasn't.
There are three types of investment experts. The first always knows what to buy, the second why to buy, while the third only knows when to buy.
Guess who made the most money? My friend once commented that over one-third of the billionaires are Jewish people only because they knew of The Joseph Cycle. See the list of Jewish Billionaires on Forbes. There could be an ounce of truth to it.
Now if Simon is right, then we can expect another 2-3 years sideways / downtrend till we arrive at a bottom in 2015. In hindsight, looking back half way through this cycle, it looks like he's proving himself right. If my guess is right, I'd think that the Fat Lady won't sing till 2015! Basically, going by this… you had two opportunities in a lifetime to invest. With one over, the next opportunity of a lifetime is coming. Be prepared.
What is Simon doing?
Well, he walks the talk. He invested around USD 400,000 at the last bottom and rode it all the way till 2008. After cashing out, his website's last update in 2009 states that he's going to hibernate in India (he may become a Swami, who knows!).
What am I doing?
Building up my cash position. One of the secrets to being wealthy, is learning how to keep the wealth! If I take the advice of Simon, then the first few years of a bull market are the best time to invest, so we're looking at 2015 to around 2020. Plenty of time to build your cash position. And if you believe this is all bull shit… well, Warren Buffet does believe in long term investing, and by long term – that could mean at least 14 years! If the moon also follows a cycle, then we can be sure that tide will go down and we'll see who was swimming naked.
To Wealth, Women and Wisdom.[Don't you love a title like that? I'm learning a new skill. Copywriting. Let's see how that goes! Fortunes are lost and made in the stock market. I've lived through two peaks already, and learned quite a few lessons in each. When there's a massive transfer of wealth taking place, you don't want to be on the wrong side. If you're a believer of cycles, you should read about The Joseph Cycle.
In the last 14-15 years, the S&P has witnessed two peaks just after the summer. Surprisingly, the first was in September 2000 and the second in October 2007 and reached almost the same levels. Both followed by a 50% crash. Ask any technical stock trader, and they'll tell you that usually the degree by which the price has risen, the harsher the fall. Could we expect more than a 50% crash in the market? And that too just after summer has ended… [click below for larger image]
I can't reveal how I'm going to be tackling this publicly. So if you're interested protecting your wealth and perhaps generate more, sign up.