Myths Busted: A Simple Mind Trick Leads Us to the No. 1 Portfolio Killer... and Shows Us How to Destroy It for Good

Dear Reader,

I’ve always wondered what it’d be like if a small town had a bad lot of teachers.

Think about it.

When I was in school, I had a lousy history teacher. He was a drunk who read the answers aloud during tests. The longer students took to answer the questions, the more he gave away.

He did it this way for years. The same curriculum, the same half-hearted teaching method... with the same results.

He pumped out 30 students at a time for 25 straight years – all of them with a lousy knowledge of American history.

He might as well have poisoned the water.

But what if he weren’t alone? What if there were a math teacher just like him across the hall? And a lousy civics teacher beside him?

We’d be in trouble... or, rather, the folks in that poor uneducated town would be in trouble.

The system is supposed to find and fix stuff like this. But after a while, dare we say, the system would be too dumb to know that anything was wrong.

Generation after generation of kids would enter the real world knowing the same few things... the same myths... and the same lies.

It’d be trouble.

But as I look around these days, I can’t help but wonder whether the problem isn’t bigger than a few bad schools

here and there. I can’t help but think we’re all part of a system gone wild. Take your health, for instance.

The Danger of Lousy TeachersWe’ve all joked about the studies on eggs. One week, they’re bad for us. The next week, it’s just the yolk that’ll kill us. A week after that, the nation is convinced that we should eat every egg we see.

Why is that? Why are we such a fickle lot?

Simple. We’ve got a lousy, lazy teacher.

Did you know that there have been hundreds of studies on eggs and their relationship to our health and, more specifically, our cholesterol?

Many of them come to the same conclusion. Some show some important variances.

But you’ve likely never been told about 90% of them. That’s because what we learn is based more on who reports a study than what the study reveals.

M A N W A R D letter

LIBERTY KNOW-HOW CONNECTIONS

Volume 4, March 2020

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Again, it all depends on the quality of our teacher.

There’s no doubt that we live in the information age. But the quality of that information is rarely what it should be. And what’s worse, the speed at which bad information flows has never been faster.

The Speed of WrongFor sure, the system we rely on today is an absolute technical marvel. An earthquake can shake the ground in a remote part of Indonesia... and folks in Bismarck, North Dakota, can learn about it just three minutes later.

It’s amazing.

You certainly remember one of the first times the nation watched a major attack on our soil in real time. Few folks will ever forget where they were when they first learned of the 9/11 terror attacks... nor will they forget who it was who broke the news to them.

That’s the thing, though.

For all we don’t understand about the human brain, it certainly has its simplicities... like “anchoring bias.”

This is dangerous. But it’s been proven that we stubbornly remember the first thing we learned about something – whether it was right or wrong.

It’s why so many folks have a hard time recalling the true chain of events on that bright and sunny September day nearly 20 years ago. And it’s why some folks swear by eggs and others have sworn off them.

We believe what we’re first told... and we stick with it even as the news evolves and the facts change.

Know Your EnemyAs someone who has made a career out of busting myths and sharing critical Know-How, I know the problem well. It’s a tough obstacle and a formidable foe.

But seeing the effects of this phenomenon time and time again has also become a great blessing. As they say, it’s good to know your enemy.

When we know that our history teacher was a dope who had a job only because of a strong union or that the nightly news tells only half the story... well, then we know what we’re up against.

I’m biased, to be sure. But I say nowhere is this phenomenon more real than in the world of investing.

The teachers aren’t liars... They’re just lazy. They’re blindly following the research done by others who came a couple of generations before them. The data has changed. The variables have shifted. And yet they continue to pull the same textbooks off the shelf and lecture as if it were 1962.

It’s costing you money.

That’s why this issue is tightly focused on what’s new in investing. But it’s equally applicable to many areas of our lives – from how we think about our health to how we nurture our closest relationships.

It breaks from the realm of the traditional and uses recent data, true-world analytics and some critical thinking to take a new look at what it means to invest... in an environment where news is instant and milliseconds count.

Some investors will find the ideas in the pages ahead rather complex. Others will find them overly simplified.

I say it all depends on your teacher... and who you learned from first.

Using Logic to ProfitWhether you’ve got an eight-figure portfolio... or an $800 portfolio... pay attention. The charts, data and takeaways I present in this month’s lead essay are powerful. I’m convinced they’ll help you avoid the dangerous trap of mediocrity.

After that, I make good on my word and introduce you to an investment opportunity that should be in every person’s portfolio – again, whether you’ve got eight bucks or 8 million bucks.

I have a feeling we’re in for quite a ride on Wall Street during the second half of the year. Depending on election promises, debate topics and the “news” that comes out of the fight ahead, stocks could get quite volatile.

But not all stocks.

Using our own logic and our own teachings, we can sidestep the dangerous action and invest in stocks that don’t much care what their brethren are doing.

I’ll show you how... and I’ll give you the ticker that will get the job done.

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Finally, my good friend Joseph McBrennan rounds out the issue with some fresh teachings of his own.

There are three simple steps to guaranteeing your family’s success for generations. But you won’t hear about them in the mainstream media. And the government won’t push for them. The reason hits on exactly why we do what we do.

The words and ideas ahead are unconventional. They’ll surely contradict what some folks were taught.

I say that’s a good thing – a very good thing.

I’d hate to live in a town filled with lousy teachers.

Enjoy.

Be well,

Andy

Shocking Proof Why Portfolio Diversification Is Wrong... and the Simple Two-Step Trick to Dramatically Lower RiskDo you know why commercial airliners don’t have parachutes? It’s not a joke or some sort of trick question. I want you to think about it seriously for a second.

If you’ve ever flown with a young child, you’ve surely heard them ask where the parachutes are.

In their mind, it’s a fair question. Parachutes keep folks from falling helplessly to the earth... and, well, we all know what an airplane can do when things go wrong.

But even with that kind of sound logic, you won’t find a parachute on Boeing’s 737 Max when it takes to the air once again. And you won’t soon hear about airlines saving millions on their insurance premiums by installing these lifesavers beneath every seat.

The reason is quite simple. When an airplane crashes, it doesn’t fall out of the sky. It crashes at the end of the

runway... it nosedives right after takeoff... or it rolls over and violently breaks apart.

It’s not fun to think about. But I offer it as proof that a parachute on an airliner would be little more than an expensive feel-good decoration that will likely only add fuel to the fire that erupts on board.

To the uninformed, in other words, parachutes sound like a good idea. But when trouble hits, they prove useless.

When Trouble StrikesIt’s with that idea in mind that I ask you another question.

How are you protecting your wealth – whether it’s $50 or $50 million – from a major downturn?

If you’ve done what you’re “supposed” to do, I know the answer.

Your portfolio is diversified. You’ve got a mix of small caps, large caps, bonds, cash, real estate... you name it.

You’re happy to underperform the stock market year in and year out because you know – when the big downturn comes – your diverse portfolio will keep you afloat.

In other words... you’re clutching that parachute thinking (quite wrongly) that if the plane has troubles, you’ll be able to safely jump out the nearest window and gently fall to the earth.

It’s a dangerous idea... and after today you’ll realize just how dumb it is.

Modern? Yeah, Like the TitanicI’ve said it many times before. If you do what everybody else does... you’ll get what everybody else gets.

It’s the definition of mediocrity.

If you want to get rich... or even if you just want to save yourself when the markets take a nosedive... you’ve got to do something different. I’ll prove it.

Modern portfolio theory (MPT) is considered the “standard of care” in the world of Wall Street. It’s the orthodoxy I heard in business school... as well as in the professional investing world... and it is the underlying theme of so much brokerage house sales literature.

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It first debuted in 1952... before the Corvette... before space travel... and, of course, before the blazing-fast transfer of news inside the world wide web.

MPT is anything but modern.

But like so many old wives’ tales and cultural myths, the legend of this deep-rooted philosophy remains a constant among everyday investors (although – rightly – we’d be hard-pressed to find a professional trader making a living off the model).

In the simplest of terms, the theory goes like this. If we focus on the right mix of assets, with varying degrees of correlation, we can maximize the returns in our portfolio and minimize the risk.

It’s a simple idea. Again, you’ve surely heard it. Like parachutes on a plane, it makes intuitive sense. But dig deeper and we see it has some serious real-world flaws.

For example, MPT relies on just a few key variables. One is the standard deviation of an asset’s historical returns. The other is an asset’s correlation to other asset classes within the portfolio.

For the boys in academia, the math adds up. But they don’t spend a whole lot of time out here in the real world. And they refuse to accept the fact that entering historical volatility is one thing... but magically predicting future volatility is something entirely different.

I remember getting a dirty look from a grad school professor when pointing out this flaw in a portfolio management class. This is where things break down.

If we dare to look at a bit more modern data than was originally presented, we see that recent research shows correlations tend to diverge when times are good (costing us returns) and converge like a couple of star-crossed lovers who haven’t seen each other in years when times are bad (boosting losses).

But again, we don’t need academic research to show us the truth.

It was quite obvious in 2008.

Bad Times Made WorseIn the money management world, we call market extremes “tail events.” It’s based on the idea of the typical bell-

shaped curve, with most events evenly distributed among the middle of the spectrum, pulling the curve higher. The events on the tails of the spectrum are rare but powerful.

Events that dramatically lower market valuations are called “left-tail events,” while those that send asset prices much higher are called “right-tail events.”

The Great Recession of 2008 was certainly a left-tail event, while the market surge in 2019 will likely go down in history as a right-tail event.

A study by Martin Leibowitz and Anthony Bova in 2009 showed the dangers of a “properly” diversified portfolio during a left-tail event. The team compared the results of what MPT would consider an adequately diversified portfolio – containing domestic stocks and bonds, international stocks, emerging market stocks, and real estate investment trusts (REITs) – with a simple 60-40 stock-to-bond allocation.

The latter won – hands down. It outperformed by nearly 10%. Imagine how well it would have done if that allocation were divided among a smart mix of low-correlation stocks and a unique mix of traditional and “alternative” bonds.

The sad fact is the harder the markets fell during the crash of 2008-09, the stronger the ties between the supposedly noncorrelated assets became. During the period, the beta of a supposedly well-diversified portfolio (a measure of a portfolio’s or asset’s movements in relation to the overall stock market) rose from 0.4 to a whopping 0.7.

The chart on the next page shows the trend in action. It shows how textbook “logic” suddenly went out the window as “safe” large cap stocks suddenly found themselves going against history and moving in strong correlation with 11 other major asset classes.

Rare but Powerful Tails of the Bell Curve

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In other words, in the high-flying days leading up to the crash, the “proper” mix of assets underperformed the stock market. And when the market melted down, the portfolio went along for a very nasty ride.

This second chart below shows the action in gruesome detail. During right-tail events – when equities are soaring and indexes are crushing new highs – diversified portfolios keep a foot on the brake pedal. The correlation between stocks and bonds is less than 0.1 (1 is a perfect correlation, and 0 is no correlation). It means if you have typical bond holdings in your portfolio like you’re supposed to, you’ll underperform the market.

In theory, that’s fine. It’s an acceptable drag on our profits... the price we pay to protect our wealth from a downturn.

But sadly, this insurance policy is not worth its costs. As the markets crashed in 2008, those bonds that were holding our portfolios back were now pushing them down. During left-tail events like we saw in 2008, all correlations were positive and were 0.5 or higher... often a lot higher.

At exactly the time our portfolios could have used a healthy dose of negatively correlated assets (which see their values rise while others fall), we saw asset classes move in painful lockstep.

A Smarter WayThere is a way around this. It’s what the math-based models can’t see...

I call it risk-factor diversification.

We’ll keep with the 2008 mess. The meltdown was caused by systemic failure in the banking system. Leveraged bets blew up and took bank balance sheets with them. And when banks fail, an economy that depends on debt as its stimulus fails.

Given that idea, it makes perfect sense that corporate bonds (debt) blew up right along with stocks. They represented the same assets... and the same risk.

As investors fled these risky assets, they moved to Treasury bonds, pushing yields toward record lows.

The “risk” during 2008 was anything tied to liquidity, corporate balance sheets or robust consumer spending. But we can’t be naive enough to think that risk covers all stocks.

A quick look at the winners from the horrendous year proves our point.

Shares of U.S. Tobacco Company surged by 26% as the tobacco and wine manufacturer was acquired by Altria. The premium price makes sense when we consider few folks give up their smokes or booze just because the banks are having a tough go of things.

Nowhere to Hide0.7

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02001 2006 2011 2016

Source: Financial-Planning.com

Insurance Not Worth the Cost Correlation

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0.8

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0.4

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Stocks vs. Corporate Bonds

Stocks vs. Real Estate

Stocks vs. Hedge Funds

Stocks vs. High-Yield Bonds

Stocks vs. Mortgage-

Backed Securities

Stocks vs. Emerging

Market Stocks

U.S. vs. Emerging

Market Stocks

Value vs. Growth Stocks

U.S. vs. EAFE Stocks

Small vs. Large Stocks

Left-Tail Correlations (stock sell-offs) Right-Tail Correlations (stock rallies)

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It’s the same for Family Dollar. I remember writing about this and watching shares soar, even as the markets sank to desperate new lows. As the headlines got worse, the news for the ultra-cheap retailer got better.

Again, liquidity problems on Wall Street have few ties to a store that makes its money when folks are frugal.

Companies in the drug space did well too. Barr Pharmaceuticals put some jingle in its shareholders’ pockets when it was acquired at a healthy premium. And Celgene saw its shares rise by double digits in 2008 because investors know folks still fight cancer even when their 401(k)s are headed south.

The numbers prove that it’s not historical correlations that matter. It’s the risk factors moving assets that matter.

In other words, it’s not broad-based asset-type speculation that we must focus on.

That’s like buying a house, an apartment and a warehouse to diversify against the risk of an earthquake. When the ground rumbles... they’re all going to fall.

But if we own a house here and another one way over there, we’ve adequately hedged our risk, without having to buy an asset that we know will needlessly drag down our returns when times are good.

It’s a simple concept... and yet the modern investing vernacular (all of which was dreamt up long before the age of the internet, a 24/7 news cycle and high-speed trading) preaches an outdated and highly ineffective form of diversification.

But there are some easy solutions...

Use This TrickThere’s no debating that stocks have far outshined other asset classes since the S&P 500 reached its bottom in March 2009. Blindly adding other asset classes solely in the name of diversification has acted only as a fierce drag on portfolio performance.

The only “safety” the strategy has created comes about because, following this outdated logic, you’ll have a whole lot less money to lose when the economy turns around.

Traditional money managers will cringe at what I write next... but the action of the last decade proves that we

must overweight our portfolios with the assets that have the most momentum and strongest performance.

Right now, that means we must be heavy on stocks. But that’s dangerous, right? Even with the facts, it’s incredibly hard not to diversify. Fine... but don’t diversify with losers. Diversify with winners.

Here’s how to do it. Go online and search for “stock correlation calculator.” When you do, you’ll find a host of websites (I’ll list my favorites in the Appendix) that measure the correlation of individual stocks. The good sites will even allow you to go back in time to measure the relationship between shares.

Enter the tickers for a few stocks and you’ll start to see some powerful patterns.

To prove my point, I took some of the leading positions in our portfolio and analyzed their performance from January 1, 2007, to January 1, 2010 – likely the most volatile and painful financial periods of our lifetime.

The opportunities are obvious. Copart (CPRT) and ResMed (RMD) boasted a correlation of just 0.09. In other words, there were virtually no ties between the two.

Copart dropped 7% during the period... but ResMed jumped by 11%. If you’d continued to hold both of them, you’d have a lot of money right now.

Better yet, take Visa (V) versus Jazz Pharmaceuticals (JAZZ). Their correlation was negative 0.09 – meaning there’s very little tie, but when one was up, the other tended to drop. Both gained value during the period.

This is a vital exercise. Too many folks – wrongly – believe that all stocks are highly correlated. They believe that when the market sinks... anything with a ticker symbol will drop. Therefore, they blindly buy other assets or sit on cash.

It hurts them... a lot.

As we gear up for what I’m convinced will be a volatile second half of 2020, diversification is on my mind.

We must always prepare for what’s ahead. But that doesn’t mean closing our eyes and doing what everybody else is doing.

It’s just the opposite. If we want outsized returns (you do, right?), by definition, we must do what others aren’t doing.

7liberty – stock recommendation

Just like a parachute won’t protect you when you fly, so-called modern diversification techniques have proven to be ineffective when the market crashes.

It’s time to think differently. It’s always time to think differently.

Andy Snyder has made his followers rich. After leaving one of the nation’s leading brokerages, Andy decided to take his wealth-exploding advice to the masses. Using his nearly two decades in the investing business to create award-winning model portfolios, he provides clear and easy-to-follow guidance on the best stocks to invest in each month in Manward Letter.

Double Your Money and Slash Your Risk With This Israeli Powerhouse Let’s put our money where our mouth is.

I will prove to you that diversification is not merely another way of saying low performance.

It should be just the opposite... a strong portfolio should have proven winners (no matter the economic conditions) in any market.

To get that job done, a stock needs a few things.

First, of course, it needs to sell a good product that is in high demand.

Next, that product should be something folks need no matter what’s happening in the world. Plagues... market

bubbles... bank failures... politics... It must be immune to all of them.

It must also have a proven track record. History must show that the stock doesn’t care what the S&P 500 is doing during any particular day. It must march to its own beat.

And finally, the stock must have the very real potential to be a triple-digit winner.

Finding just one of those criteria is tough. Finding a stock that matches all of them... that’s quite hard. But I’ve done it for you.

Proving that this company has a product that folks want, its sales have soared from $489 million in 2016... to $607 million in 2017... to $937 million in 2018... to more than $1.4 billion in 2019.

And since this company makes key components for the world’s booming solar market, it’s not relying on a product that’s at the mercy of fickle consumer tastes. As more and more countries write laws and post rules forcing the use of renewable energy sources, its business will only become more reliable.

What’s happening with the economy... interest rates... banks... disease... and even trade deals won’t affect its sales. In fact, the largest threat to the business is politics. If solar incentives or subsidies are erased, demand could be hurt. But that idea is nearly gone when we consider the fact the company is based in Israel and ships its products across the globe into a host of countries with a wide array of political ambitions.

Of course, the math proves our hunch is correct. The company boasts a five-year beta score of just 0.05. That means no matter what stocks are doing... shares of this company don’t much care.

THIS MONTH’S STOCK PICK

Why Did Andy Meet With This Mysterious Woman?

She has been on the trading floors of multibillion-dollar hedge funds... negotiated investment banking deals with tens of millions of dollars at stake... and gone toe-to-toe with some of the most well-known investors in America.

But you will not believe what she just told him. Get the full scoop by visiting www.AlphaMoneyFlow10.com. Or call 844.201.1980 and mention priority code GMTDW300.

And, finally, the best part. Like I said, a good stock must have the ability to double our money or more. This one absolutely does. Its sales and profit growth prove it.

If those trends continue (I think they’ll only amplify from here), we could double our money in 14 months or less.

Light Up Your PortfolioWith a name like SolarEdge Technologies (SEDG), this company makes its business clear. It’s a leader in a booming international industry.

The way I see it, SolarEdge has a big opportunity in three distinct areas – commercial, residential and grid services.

The first two are fairly straightforward. The company makes the components necessary to build large-scale solar projects. Take, for instance, a new project it recently announced in Brazil.

When electricity is generated by large solar panels, getting it onto a nation’s grid isn’t quite as easy as connecting a few wires and letting the juice flow. It needs to be transformed into a type of current that’s compatible with the grid.

In Brazil... that magic will happen thanks to SolarEdge’s inverter technology.

Fortunately for its investors, the company has projects like this spread across the globe.

It’s much the same in the residential realm. But this time its focus – and its biggest opportunity – is in charging electric vehicles (EVs).

Whether it’s SolarEdge’s recent acquisition of an electronics component made for EVs or its fresh deal with Google and its Assistant product that allows folks to better monitor and control the charging of their cars, the company is working at the tip of the high-tech spear.

Better yet, SolarEdge claims the world’s first solar inverter for EVs.

That’s big. And it spells a huge opportunity as the industry looks to power its vehicles with renewable and cheap sources of energy... like the sun.

But it’s plans like what’s coming together in New England that tie all these ideas together and make an investment in SolarEdge a no-brainer.

A Grid LockThat’s where the company is working with residential customers and the folks operating and maintaining the power grid on a project that shows what the company is truly capable of... and where it’s headed.

It’s the third big piece of the company’s business. It focuses on the technology needed to run a reliable and efficient energy grid.

In New England, for instance, SolarEdge is working with customers to install what are essentially large batteries in customers’ homes. It can then use these batteries as a sort of cushion for periods of peak demand – storing juice when it’s not needed and tapping into it when it is.

It’s a win for all parties involved. SolarEdge obviously gets a sale. The consumer gets tax rebates and a better deal on the monthly charges. And the power companies can smooth out bumps and valleys in demand without installing costly new infrastructure – like megamillion-dollar power plants.

This is the part of SolarEdge’s business that appeals to me the most. Its grid services work stands to see a bright future as more and more large-scale projects come online and the industry becomes much more high-tech.

Its grid-focused offerings hit three main ideas. First, they allow power companies to save money by tapping into huge pools of stored energy (slashing their price-hedging risk). Second, they allow grid operators to decentralize their operations and instead rely on a wider distribution of energy production. Think of this as going from one coal-powered plant producing electricity for a town to hundreds of residential solar arrays providing that energy. And, finally, they offer robust software that allows power companies to significantly boost their efficiency.

It sounds complex. But it’s not. SolarEdge is merely the brains to a power company’s energy-creating brawn.

Risk-Free RewardBut like I said, this company is the ultimate play for investors wary of a stock market that is becoming increasingly volatile... and correlated.

With its ultra-low beta and its steady sales growth over the past half-decade, SolarEdge has a proven history of doing its own thing... which tends to be quite positive.

8liberty – stock recommendation

That’s good news for you. It’s a chance to get in on a company that has a strong, growing business... and that offers a set of (low) risks that differ significantly from the rest of the market’s. Like I said... It’s a no-brainer.

Joseph McBrennan is a longtime friend of Manward Press and one of the smartest, most sophisticated and yet down-to-earth financial experts out there. As a private banker, he has seen it all... and he has some choice words for a government that refuses to let go of its golden goose.

Three Steps to Guarantee Your Family’s Success... for GenerationsBy Joseph McBrennan

What would it be worth to guarantee your grandkids’ success in life?

Hollywood celebrities have been caught spending hundreds of thousands of dollars to bribe university officials to get their kids into some of the nation’s most prestigious schools. They figure it was well worth the six-figure payments just to attempt to set their children up for success.

So if money were no object, how much would you spend to nearly guarantee your children or grandchildren a better than 70% chance at a successful life?

$10,000? $100,000? More?

I’ve got good news.

It turns out the answer doesn’t have a dollar sign attached to it. And it’s something that should be shouted from the rooftops... but won’t be.

Ignoring the FactsWhile doing some research recently, I stumbled across a footnote that led me to an article by The Brookings Institution, titled “Combating Poverty: Understanding New Challenges for Families.”

That understated title is inexcusable. It should have read, “Brookings Institution Closes Wage Gap”... or “Researchers Eliminate Poverty.”

Now, The Brookings Institution isn’t known for being a bastion of conservative thinking. The reality is it’s full of a bunch of leftist libs. So when it produces information that, quite literally, provides a solution to poverty in the United States, you’d think someone would have noticed.

Not only has no one noticed... but it seems they’ve gone out of their way to ignore the facts.

Why aren’t the front pages of every newspaper and news site blazing with headlines announcing, “RESEARCH UNCOVERS SECRETS TO SUCCESS”? Why hasn’t Good Morning America scheduled interviews on the simple steps that can lead children from poverty to prosperity? Why aren’t the teachers’ unions screaming “Eureka!”? I’ll reveal the disturbing answer in a minute. But first, some facts...

Three Steps to SuccessI’ll save you from having to read the entire Brookings report. The following quote from the author, Ron Haskins, says it all [emphasis mine]:

Young people can virtually assure that they and their families will avoid poverty if they follow three elementary rules for success – complete at least a high school education, work full time, and wait until age 21 and get married before having a baby.

Based on an analysis of Census data, people who followed all three of these rules had only a 2% chance of being in poverty and a 72% chance of joining the middle class (defined as annual income above $55,000 in 2010). These numbers were almost precisely reversed for people who violated all three rules, elevating their chance of being poor to 77% and reducing their chance of making the middle class to 4%.

The findings say nothing more than it’s a mistake to drop out of school. They point out that it’s smarter to

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Action to Take: Buy shares of SolarEdge Technologies (Nasdaq: SEDG) at the market’s price. We’ll add this to our Everyman Portfolio and use our typical 25% trailing stop.

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wait until you’re old enough to order a Budweiser before getting married or having a child.

And my personal favorite, to avoid poverty, you need to work.

Education. Marriage before kids. Work. That’s it. Please hold off sending me an email telling me this is common sense. I agree. There’s not a Midwesterner I know who wouldn’t say that this is obvious.

The Media’s Silence Is TellingYet, as true as the findings in this report were, the news was virtually ignored by our media. When I Googled the report, I found no media coverage at all. Zip. Nada. This deafening silence is telling.

Renowned economist Walter Williams once said in an interview, “The government has said to many young women, I am the father. And so the [biological] father has become dispensable.” In other words, the very welfare programs designed to lift up the impoverished have had the opposite effect.

If the government really wanted to solve the wage gap or cared at all about poverty, why isn’t this information out there? Why isn’t it being taught in the classroom? Why has the ruling elite not demanded these steps be in the hands of every social worker?

It’s simple. The government is turning a blind eye to the facts in order to protect its golden (reliably voting) goose.

Follow the MoneyKeeping the quote from Walter Williams in mind, let’s think about who benefits most from dependent citizens.

The answer is the state and, more specifically, the U.S. federal government and the bureaucratic machine built to serve it.

Free education, free housing, free cellphones... and, even as some presidential candidates have promised, free money in the form of guaranteed basic income.

Make no mistake about it... while these programs may be promoted as “free,” they’ll lead to the continued destruction of the foundation to our society (the family). And this error will be more costly than any of our misguided wars.

When you steal dollars from the productive class with ever-rising taxes and provide for and encourage the nonproductive class, you create dependents. Those dependents become enslaved to their government checks.

During the Great Depression, anybody who went on the government “dole” was too embarrassed to admit it and worked like crazy to get off it as soon as possible.

Today we have multiple generations forever on some sort of handout.

Willing ConspiratorsNone of this could have succeeded without the government’s willing accomplices in our media. The small minority of journalists who support these three simple steps to success risk their livelihoods if they dare speak up.

Can you imagine if someone on CNN were to say unwed mothers need husbands or women should get married before having babies? They’d surely lose their jobs if they said all able-bodied people should be ashamed if they’re on welfare.

And the entertainment industry – which no longer makes movies or TV shows with real moral lessons – actually glorifies drugs, teen pregnancy and seemingly encourages violence against the productive working class.

Look no further than the acclaimed movie Joker for a sick example (not recommended viewing).

It Gains When Our Kids LoseA permanent dependent class, wallowing in perpetual poverty, has helped create and feed one of the greatest bureaucracies ever known to man.

Excluding the military, the U.S. federal government consumes an estimated 24% of our $21 trillion gross domestic product.

That means $5.25 trillion disappears into the black hole of our federal government.

Looking at it another way... there are 5 trillion reasons to keep a dependent class dependent and never explain that freedom from welfare enslavement is as simple as working full time, getting your diploma and getting married before you have children.

liberty

1 1portfolios

The Own What You Know Portfolio

Company/Symbol Rec. Date Rec. Price Curr. Price Rating Trailing Stop Total Gains

AGCO (NYSE: AGCO) Aug-19 $70.29 $66.61 Buy $60.37 -4.55%

Air Products and Chemicals (NYSE: APD) Sep-19 $225.38 $255.74 Buy $192.01 14.50%

Alamo Group (NYSE: ALG) Oct-18 $90.33 $129.78 Buy $98.05 44.47%

Copart (Nasdaq: CPRT) Nov-18 $50.30 $102.42 Buy $77.51 103.62%

Flagstar Bancorp Inc. (NYSE: FBC) May-19 $35.25 $35.53 Buy $29.31 1.13%

Graco Inc. (NYSE: GGG) Nov-19 $46.98 $56.38 Buy $42.26 20.38%

Visa (NYSE: V) Sep-18 $147.80 $211.20 Buy $157.72 43.98%

Zoetis Inc. (NYSE: ZTS) Mar-19 $95.72 $143.65 Buy $108.71 50.80%

Last Update: 2/18/20. Gains include dividends.

The Everyman Portfolio

Company/Symbol Rec. Date Rec. Price Curr. Price Rating Trailing Stop Total Gains

Assurant Inc. (NYSE: AIZ) Apr-17 $95.11 $141.80 Buy $106.89 55.75%

CACI International (NYSE: CACI) Feb-19 $172.51 $283.00 Buy $210.05 64.05%

Constellation Brands (NYSE: STZ) Dec-18 $193.21 $203.82 Buy $157.01 7.43%

Golub Capital BDC (Nasdaq: GBDC) May-18 $17.96 $18.43 Buy $12.73 16.54%

Herc Holdings (NYSE: HRI) Jun-19 $37.91 $43.80 Buy $37.79 15.54%

Jazz Pharmacueticals (Nasdaq: JAZZ) Jan-20 $144.37 $136.83 Buy $114.56 -5.22%

Loral Space and Communications (Nasdaq: LORL)

Feb-20 $33.22 $35.41 Buy $26.86 6.59%

ProShares Short FTSE China 50 ETF (NYSE: YXI)

Jan-19 $21.42 $18.38 Buy $16.07 -13.35%

ResMed Inc. (NYSE: RMD) Oct-17 $76.53 $174.80 Buy $132.45 133.24%

Smith & Nephew (NYSE: SNN) Dec-19 $43.80 $47.97 Buy $37.93 9.52%

SolarEdge Technologies (Nasdaq: SEDG) Mar-20 New New Buy 25% TS New

Waste Management Inc. (NYSE: WM) Apr-17 $72.84 $126.22 Buy $106.89 80.40%

I’m not saying the effort required to follow these timeless

truths is easy. Like anything worthwhile, there is a price.

That cost is hard work and discipline.

It’s up to us to get the word out... beginning with our kids

and grandkids. These three simple steps to success should

offer tremendous hope to anyone less fortunate. They reaffirm truths that helped make this country great.

Namely that the vast majority of individuals have within their own grasp the ability to succeed and prosper...

Without relying on government aid or social programs. n

About the cover image:

The dunce cap hasn’t always been a symbol of stupidity. The conical cap originated with John Duns Scotus, a master philosopher, linguist and theologian from the mid-1200s. His intricate and complex theories and teachings earned him the moniker “The Subtle Doctor,” as well as a devoted following of “Dunsmen.” Scotus believed that the pointed shape of the hat would in some way act as a reverse funnel for knowledge, drawing wisdom through the tip and spreading it down to the brain. The hats then became popular among Dunsmen and were viewed as a symbol of higher intelligence. But by the 1500s, more than two centuries after his death, Scotus’ teachings fell out of favor among church scholars. And so Dunsmen began to be labeled as out of touch... or just plain stupid.

SolarEdge Revenue Growth

'15 '16 '17 '18 '19 '15 '16 '17 '18 '19

Source: Company Reports

Revenues ($M)

424.7490

607

937.2

1,430

55.871

91.1

139.4

189.9

Operating Profit ($M)

Renewable Energy Supply on the RiseGlobal primary energy demand

1900 1950 2000 2050

Source: McKinsey Energy Insights’ Global Perspective

RenewablesFossil Fuels

SolarEdge Inverter Shipments (Megawatts)

Source: Company Reports

6,000

4,000

2,000

02015 2016 2017 2018 2019

12

© 2020 Manward Press | All Rights Reserved

Manward Press is a financial and wellness publisher that does not offer any personal financial advice or advocate the purchase or sale of any security or investment for any specific individual. Members should be aware that although our track record is highly rated by an independent analysis and has been legally reviewed, investment markets have inherent risks and there can be no guarantee of future profits. The stated returns may also include option trades. We expressly forbid our writers from having a financial interest in their own securities recommendations to readers. All of our employees and agents must wait 24 hours after online publication or 72 hours after the mailing of printed-only publications prior to following an initial recommendation. Any investments recommended by Manward Press should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company. Protected by copyright laws of the United States and international treaties.

The information found in this newsletter may only be used pursuant to the membership or subscription agreement and any reproduction, copying or redistribution (electronic or otherwise, including on the world wide web), in whole or in part, is strictly prohibited without the express written permission of Manward Press, 14 West Mount Vernon Place, Baltimore, MD 21201. Manward Letter is published monthly for $149 per year by Manward Press, 14 West Mount Vernon Place, Baltimore, MD 21201, www.manwardpress.com.

Further Reading

“What a study of correlations reveals about diversification,” Financial Planning: https://www.financial-planning.com/news/what-a-study-of-correlations-reveals-about-diversification.

“When Diversification Fails,” Financial Analysts Journal: https://www.tandfonline.com/doi/full/10.2469/faj.v74.n3.3.

“Creating Energy Independence With Solar Panels and Storage Battery Systems in the Home,” Forbes: https://www.forbes.com/sites/sherikoones/2020/01/26/creating-energy-independence-with-solar-panels--storage-battery-systems-in-the-home.

Appendix

Stock Correlation Calculatorshttps://www.portfoliovisualizer.com/asset-correlationshttps://www.buyupside.com/calculators/stockcorrelationinput.phphttps://www.marketinout.com/correlation/stock-calculator.php