Gaffer's Portfolio 

July 30, 2010

The Gaffer Wealth System over the past 19 months – the savage final months of a recession, an explosive recovery that few believed until the first phase was almost over, and more recently a correction that some believed was the start of a double-dip recession – has proved itself, I think, to be a valuable tool for conservative investors.

If you have followed this portfolio and read the comments on the accompanying blog at http://www.lunchwithgaffer.com/portfolio/ you already know more about true investing than most of your friends and neighbors.

The portfolio has done its job. I said at the outset I expected it to outperform the S&P 500 index. It has not done so every month but over the past 19 months it has inched ahead by 2.5%. That's about what we should have expected and almost exactly what I predicted in the book.

If you bought the system (at www.lunchwithgaffer.com), you also learned how to buy stocks directly from the issuing companies with zero commission – and that was just one small fraction of what you discovered. You learned how to stay relatively safe while others were losing their heads. You learned how to find money for investment without borrowing. You learned how to plan your retirement and determine what your particular needs will be. You also learned how to account for inflation in your plans.

There is nothing new in what I have taught…other than the novel way I teach it. I began as a very wet-behind-the-ears 20-year-old and made just about every mistake in the book. Life could have been so much easier and far less stressful without all those mistakes. That is why Gaffer came to be: to help you to avoid the mistakes I and most other beginners made.

It has been a pleasure to bring you Gaffer and his friends who discuss investing over lunch every Sunday in Cripple Hole Creek, population 209. Despite the humor, this is serious stuff, especially in these uncertain days in which many governments have already recognized they can no longer afford the same level of pensions or even the same retirement ages.

We need to learn to look after ourselves. Once upon what seems like a long time ago some of us expected our children could look after us in our old age. Now? We look after them; have you seen the unemployment figures for young people, even those with good degrees?

My task here is done. I have taught you all I can at this level and now I must pay more attention to my other business: Wealthy Investor Limited. We have developed a system with such a high rate of return from the S&P 500 and the Dow that I have had to hire a PR firm to help with its launch in the next couple of months. The results are so high that they need explaining in detail…and we are preparing material to do exactly that. We will teach people the exact system so they can work it out for themselves. And we do that with far more than just a book.

These things take intense effort. They also involve others who depend on me so they can earn a living. I have given you what I can here; it is up to you whether you use it. Now I hope you will understand when I direct my attention elsewhere. I have much more to teach and that will be done through Wealthy Investor. You can download the latest book and proof of the amazing results from www.thewealthyinvestor.info. There is nothing to buy. We'll even give you 26 weeks of our soon-to-be-launched newsletter. No credit card, no catch, just tell me where to send it.

Okay, one last thing: I have watched with amazement as some doomsters have been forecasting a double-dip recession. Nonsense! We have had a very normal correction in the early stages of a bull market. People have been particularly jittery as a result of the recent recession and what the stock market did to their savings, so doomsters make easy headlines. But those headlines do not do you any good; quite the reverse.

The correction may or may not be over but of one thing I am sure: we have already seen the worst of it. There's a great year ahead.

What you must have if you hope to make money consistently with stocks is a system. Almost any system as long as you have faith it works. But once you have found it, stick with it harder than Crazy Glue. Flit from headline to headline, from adviser to adviser, from tip to suggestion to hint to hope and you are sure to lose – or at least to perform worse than the market. All that worry for nothing!

One more thing: America is in a tough spot but it will recover. Saner heads will prevail.

Thank you for your time. I hope I have been able to help.