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The Mad Hedge Fund Trader

The Mad Hedge Fund Trader. HS Dent Network Demographic School Pointe Hilton Squaw Peak Resort, April 28, 2011 www.madhedgefundtrader.com. The Procreation Trade. * A trend you can absolutely rely on *It’s a million year trend *Has entered its exponential growth phase *Is unstoppable.

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The Mad Hedge Fund Trader

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  1. The Mad Hedge Fund Trader HS Dent Network Demographic SchoolPointe Hilton Squaw Peak Resort, April 28, 2011www.madhedgefundtrader.com

  2. The Procreation Trade *A trend you can absolutely rely on*It’s a million year trend*Has entered its exponential growth phase*Is unstoppable

  3. The Reverend Thomas Malthus1766-1834 *The father of demography*Linear growth of food supplies*Exponential growth of populations*Utopia is unattainable because resource shortages bring famine, disease, and wars.*His Solution: Virtuous behavior*My solution: Buy Hard Assets

  4. Population Changes 2010-2050 *2 billion new people*More than half of the increase will be in Islamic countries.Islamic population growth from 1 to 2 billion The war against terrorism will not end in 4 years*Population levels off in Latin America, Africa, ChinaChina’s one child policy has cut growth by 400 million*Population shrinks in Japan and levels off in Europe*US population levels off at 400 million in 2050 from the current 300 million The immigration advantage: Add 1%/year of GDP growth *175,000 new customers a daysource: CIA Fact Book

  5. The Rise of the Emerging Market Middle Class 1980 Global Middle Class580 million2010 Global Middle Class 900 million (add China)2050 Global Middle Class2 billion (add India, more China, Latin America, and other emerging markets)1980 35% US exports to emerging markets2010 54% US exports to emerging markets1980-2010 China’s per capita income rosefrom $100 to $3,000/year,versus $46,000 for the USsource: World Bank

  6. Trading DemographicsIndia is a buy Rising populations create ever more consumers and little need for social services mean strong GDP growth, small budget deficits, and a strong currency.Source: US Census Bureau

  7. India ETF (PIN)

  8. If Demographics is Destiny, then America’s Future is Scary. Source: US Census Bureau Aging population and falling birth rate brings a slower growing GDP, a growing demand for social services, rising budget deficits, and a weak currency. Source: US Census Bureau

  9. US Population Pyramid 1900

  10. US Stock Market 2003-2011

  11. At Least the US is Not Japan (Yet) By 2030 Japan will have only two workers for every retiree, bringing no GDP growth, huge demands for social services, enormous budget deficits, and a collapsing currency.Conclusion: Short the yen (YCS) and the Japanese government bond and stock markets.Source: Japanese Ministry of Health, Labor, and Welfare

  12. Japan’s Nikkei Average 1970-2011 For proof you should never rely on a single tool-best pop pyr

  13. Afghanistan

  14. Demographics and Real EstateYour Largest Personal Asset *Most People Know the least about the fundamentals about their largest personal investment*Dead Money for 10 years*Massive supply meets limited financing*The end of federal subsidized financing (Fannie Mae & Freddie Mac)*Replay of zero return 1929-1955*Who is Kathleen Casey-Kirschling? Hint: birthday January 1, 1946

  15. The Silver Tsunami *80 million boomers born between 1946 and 1954*10,000 a day are now retiring*Social Security turns cash flow negative by 2017*Social Security runs out of money in 2041*Boomers will be followed by only 65 million gen-Xer’s*don’t count on selling your house to your kids, especially if they are still living in the basement

  16. Where Do Retirees Live? 3.6 million retiring baby boomers per year are creating enormous downward pressure on real estate prices as they downsize from 2,500 square foot homes to 1,000 sq ft condos, to 100 sq ft rooms at assisted living facilities.Dumps 4.3 billion sq ft. of housing on the market every year for 22 years=430 World Trade Centers

  17. US Homes For Sale • 1 million new homes4 million used homes1 million bank seized20 million-sell on any uptick (Zillow.com survey)26 million total versus 4.9 million actual demand= 5years of inventoryOne out of 5 American Homesis for sale or is about to hitthe marketHow many homes do boomers own?

  18. Conspicuous Non-Buyers • 35 million unemployed, including those whose benefits have expired and discouraged workers.35 million existing homeowners with negative home equity.70 million total missing buyers out of a US home market of 140 million.(what happens when interest rates rise? Fannie Mae and Freddie Mac disappear?)Best case: long grind in prices sidewaysWorst case: down another 20% triggering a second bank crisis.

  19. How Low Can They Go?Case-Shiller Real Estate Price Index

  20. To Access my Research Data Base Please Go towww.madhedgefundtrader.com

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