How to Do the Impossible
Issue #2078
- WEALTHY: 2 things to look for in stocks with major upside potential (Andrew Gordon)
- HEALTHY: Debunking a medical myth (Dr. Al Sears)
- WISE: William Blake on systems
ALSO IN THIS ISSUE:
- Why you’ll never have to pick up the phone again (Timothy Ferriss)
- How Yahoo made sure you’ll pay less for Internet ads (Michael Masterson)
- It’s Fun to Know… about the Olympics
- Add "roborant" to your vocabulary
You Already Know Fortunes Are Made from Trading. The Question is: WHAT Are ‘They’ Trading Most? (And it’s not Shares or Commodities!)
… Thirty times more trading going on than the stock market and mostly investment banks doing it. Ummm… Maybe ‘they’ know something you don’t?
The Contrarian Play With a Big Payoff
There is a simple way to stay one step ahead of the pros and pick stocks that can give you big returns on your investments. All you need to do is look for stocks that have two things going for them.
The first is a low "PEG" (price-to-earnings-to-growth ratio). To get that number, you divide the stock’s P/E (price-to-earnings ratio) by its projected annual earnings growth. If, for example, a company has a P/E of 8 (anything below 10 is very good) and its projected annual earnings growth is 10 percent, it has a PEG of 0.8 (8 divided by 10) - and anything below 1 is great.
A company with a P/E that is half the average of the S&P 500 (which is currently about 16) that is still projected to increase its earnings at a double-digit rate would be a find. You’d be getting value and growth rolled into one. But it’s not hard to do even better than that - which is where the second thing comes in…
You know you have a stock with major upside potential when a low PEG is accompanied by weak analyst recommendations. You get this combination in weak or cyclical sectors or in sectors on the verge of rebounding. When analysts start to upgrade their recommendations on a stock like this, it can climb rapidly up the charts.
How to find companies with both a low PEG and weak analyst recommendations? Most search engines on financial sites can help you find low PEG companies, and they’re free. Then, on the company page, look for a link on "analyst opinion" or "recommendations."
[Ed. Note: Andrew Gordon, ETR’s Investment Director, has authored several books on energy markets, global countertrade practices, and the hot growth sectors of China and Russia. A former professor of marketing and finance, he is the editor of INCOME, a monthly financial advisory service that uncovers income-generating stocks that promise safety (first and foremost), along with much-higher-than-average profit potential.]
"I must create a System, or be enslav’d by another Man’s."
William Blake
How to Do the Impossible: Create a Paperless Life, Never Check Voice Mail Again, Never Return Another Phone Call
By Timothy Ferriss
Forget the paperless office - that’s aiming too low.
Let’s take a look at the bigger picture: a paperless life. While we’re at it, let’s also eliminate three other nuisances: answering the phone, checking voice mail, and returning phone calls.
Is this possible? It is. The key to finding means to accomplish the "impossible" is asking the right question: "How would you do ____ for a week if your life depended on it?" Most things considered impossible just haven’t been looked at through the "how" lens of lateral thinking.
Here are two warm-up exercise questions for Paperless Life 101:
What would you have to do to never again touch mail?
What would you have to do to never touch another check?
Consider these as real questions. If I offered you a million dollars to stop doing these two things for a month, could you do it? Here are a just a few potential strategies you could use… then we’ll move on to phone games:
- No more mail
First, we need to cut out the crap - reduce volume. To begin, get removed from junk-mail lists and common commercial mailing lists. There are a few ways to do this:
- Get removed from the most common junk-mail lists at dmaconsumers.org. (This costs a few dollars in some cases.) And check alternative strategies at stopjunkmail.org.
- Use LifeLock, or another identity-protection service, which automatically removes you from large mailing lists, one of the most common vehicles for identity theft.
- Have your mail forwarded to special processing centers, where it is all scanned and e-mailed to you. One popular service is Remote Control Mail, which offers two big benefits to the time-focused and mobile-minded: (a) Relevant postal mail is funneled into e-mail, so you can check both e-mail and postal mail at once. (b) You can travel freely, whenever and wherever, without ever missing a letter.
- No more checks
- Set up online banking so you can issue checks directly from your bank, and set up automatic recurring payments.
- Give your accountant power of attorney to sign specific checks (for tax documents, etc.) on your behalf. Power of attorney is no joke, so do your homework - but it can be used with little risk. This approach not only cuts down on checks but also on finance-related mail, which you can then forward to your accountant for handling, start-to-finish.
"But what of the other 9-to-5 headaches?" you ask. "How can I eliminate the need to answer the phone, check voice mail, or return phone calls?
Here are a few quick fixes:
- No more answering the phone
Use a service like GrandCentral so you can listen to your voice mails as they’re being left. Each caller is required to announce their name before the call is dialed, and you are able to preview the name and then send the call to voice mail, where you can listen to the message they’re leaving. If you want to speak with them, you can jump in. If not, let them leave the message.
- No more voice mail
Stop managing separate inputs from office phone voice mail, cellphone voice mail, and multiple e-mail accounts. Consolidate. Get your voice mail delivered to your e-mail inbox, which then serves as your single communications "funnel" - with all your e-mail, postal mail, and voice mail in one place. GrandCentral can e-mail audio files, but for those who want text, Simulscribe is a popular option with nearly 90 percent transcription accuracy.
To further encourage people to communicate with you via e-mail, there are two approaches that I’ve used effectively: Indicate in your voice mail greeting that they must leave their e-mail address, and then respond to them via e-mail. You can also use a service like Jott to send a voice message to them as an e-mail.
- No more returning calls
Pinger enables you to send voice mail to people without calling them. Why would you want to do that? Pinger’s website explains:
"We’ve all been there - you make a call and think to yourself, ‘please don’t pick up,’ or you call and think ‘I hope I’m not interrupting…’ With Pinger you leave the message at your convenience, and they get it at their convenience. Unlike voice mail, there is no ringing, no annoying prompts, no lengthy greetings - just your message."
None of these strategies is perfect, but they do demonstrate that none of our impossible questions are impossible to answer. Once you frame the question in terms of "how would I…?" it is entirely possible to stop tolerating most of life’s annoyances and eliminate them altogether.
[Ed. Note: Tim Ferriss has a special offer for ETR readers. Today, if you purchase 5 or more copies of Tim’s #1 Wall Street Journal best-seller, The 4-Hour Workweek, he will send you his exclusive 60-minute interview with Jack Canfield, co-creator of Chicken Soup for the Soul (150+ million copies sold). In this interview, Tim discusses exactly how he hit the New York Times and Wall Street Journal lists in four days using blogs and other "new media." How did he outsell all of the top business books with no paid advertising? This is information available nowhere else. Here’s what you need to do:
- Order 5 or more copies of The 4-Hour Workweek here.
- Send the e-mail receipt you’ll get from bn.com to amy@fourhourworkweek.com with "ETR bonus" in the subject line. You’ll get the interview via e-mail as soon as Tim’s executive assistant verifies your e-mail receipt from bn.com.]
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Notes from Michael Masterson’s Blog: The Online Advertising Game
Buying advertising space on the Internet is becoming easier, thanks to a bunch of small companies that offer electronic exchanges where advertisers can bid for space on a host of websites all over the world.
These businesses (Right Media Inc., AdECN Inc., Turn Inc., and ContextWeb Inc.) have been operating out of the limelight, focusing on smaller markets. But that changed when Yahoo agreed to pay $680 million for 80 percent of Right Media in April. Now it’s clear that the bigger net companies, including Google Inc., Yahoo Inc., and Microsoft Corp., want to get into this game.
Most websites sell the display space they have either by employing their own salespeople or by participating in an ad network that links them with other small- and medium-sized websites. But that is a difficult, time-consuming process, and a big part of the available ad space inventory is never sold. With ad exchanges, websites can sell off those small pieces in a sort of blind auction to larger advertisers looking for bulk coverage. Advertisers indicate what kind of ad spot they are looking for and name a price. The system matches those bids with data it has from the websites.
By bringing together lots of small ad sellers, exchanges can help large advertisers buy in the large quantities they like. Exchanges collect payment for the ads and then send them along, minus a commission, to the websites.
ETR’s own Wendy Montes de Oca recommends AdBrite as another great resource to use when considering buying banner space from a network. "Think of them as the ‘priceline.com’ of online ads," Wendy told me. AdBrite has been around since 2002, and works with both advertisers and publishers. The company serves ads on 1,021,030,066 pageviews, from 45,378 sites such as Excite.com, Linkedin.com, Alexa.com, and many more.
"To use AdBrite," Wendy says, "you choose what type of ad unit you’d like (text or banner), choose your targeting (demographics, keywords, geography), set a maximum CPM (cost per thousand - the price you’ll pay per thousand views of your ad), and daily budget. Then, to create your ads, you merely upload your creative and destination URL, selecting various ad unit sizes such as 728×90 IMU (interactive marketing unit), 468×60 IMU, etc."
The caveat here, says Wendy, is that advertisers who use AdBrite should be somewhat savvy to CPM rates, the quality/value of the website they may be appearing on, and their ad unit before they set their maximum CPM.
"Some of the sites in the network are not top tier sites and don’t warrant a CPM of more than $1.50 to $2.00," she says. "And be cautious. You may be buying remnant space, space that is left over and cannot be sold by the sales team. The units available may be leaderboards (which means they appear at the top of a website page) or skyscrapers (which appear down the side of a website page). Since these types of ads are both outside the content, they typically get fewer clicks than large rectangle ads that appear between the paragraphs of an article."
- Michael Masterson
[Ed. Note: To read more of Michael’s unedited, uncensored (and sometimes unexpected) ruminations, check out his blog here.]
Reader Feedback: "Thank you for allowing your ‘personhood’ to show through so strongly."
"’Michael Masterson’ had just been a name to me. I’d seen it on mailers, I see it on the AWAI copywriting program that I’m taking, and I’ve seen it on well-written business articles in ETR. Still, just a name, not a person. A successful name, with good business advice, but still… just a name.
"Only now I’ve run across several articles in which you advise on life - always with a business purpose, but the life application is even stronger. The ‘Brice’ and ‘Ellen‘ pieces in particular have moved you to the ‘person’ category… one who would be cool to know on any level, not just business.
"Amazing, isn’t it? The business advice you offer is no different (good, as always) - but now that I see you as a person and not just a name, I pay closer attention to it. I even seek out your articles instead of just waiting to run across them.
"The sincerity of the articles shines through, and that makes all the difference. I suppose it helps that your personal advice is outstanding - something I value far more than business advice - so I wanted to take the opportunity to thank you for allowing your ‘personhood’ to show through so strongly."
- Rob Swanson
Orlando, FL
Have Your Steak and Eat It Too
By Al Sears, MD
Many patients come to my clinic with the idea that meat - especially steak - is "bad." They repeat what they’ve been told by other doctors: Foods high in saturated fat raise cholesterol levels and increase the chance of heart attack or stroke.
But a study published in the American Journal of Medicine agrees with what I’ve known for years - that there’s no link between LDL levels ("bad" cholesterol) and heart attacks. Not only that, but as the participants in the study got older, the association between cholesterol and heart disease became weaker, not stronger. For men above age 47, cholesterol levels made no difference in cardiovascular death.
The same study found that high levels of HDL are directly linked to a lower risk of heart disease. If your HDL is above 85, you’re at no greater risk of having a heart attack if your total cholesterol is 350 or 150. This means that if you increase HDL, you can reduce coronary disease… regardless of your LDL cholesterol levels.
So forget the "meat is bad" mantra and try taking these simple steps instead:
- Restore omega-3s to your diet. Grass-fed beef is your best choice. It’s "guilt-free" steak at its best. Wild-caught fish; free-farmed, organic poultry; nuts; olives; eggs; and avocados are rich in "good" fat. And cod liver oil - the best omega-3 supplement - will boost your HDL levels naturally.
- Know your lipid profile. If your HDL is below 35, take steps to increase it.
- Fill up on niacin, which lowers both LDL and triglycerides and allows for increases in HDL. The best food source of niacin is nuts and dried beans. Many meats (such as liver, poultry, and fish) also contain niacin.
- Maintain a low-carb diet. It will help balance your HDL and reduce your LDL.
- Add short-duration, high-intensity exercise to your routine. Exercising in short bursts - as with my PACE program - boosts reserve capacity in your heart (critical for avoiding heart attacks) and raises HDL.
[Ed. Note: Dr. Sears is a practicing physician and an expert on heart health. You can learn how to apply his winning heart-healthy strategies in The Doctor’s Heart Cure.]
It’s Fun to Know: About the Olympics
The Olympics originated in ancient Greece in 776 B.C. as a pagan religious festival. The games were banned in 393 A.D. by Roman Emperor Theodosius, and revived in 1896 by Frenchman Baron Pierre de Coubertin, who turned the event into an international contest.
The next summer Olympics will be in Beijing in 2008. The next winter Olympics will be in Vancouver in 2010.
(Source: the InfoPlease website)
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Word to the Wise: Roborant
A "roborant" (ROB-uh-runt) - from the Latin for "strength" - is a tonic.
Example (as used by William Least Heat Moon in River Horse): "That day, I felt the need of a roborant after my ghost-ridden night, and I swigged down two doses."
[Ed. Note: Become a more persuasive writer and speaker … build your self-confidence and intellect … increase your attractiveness to others … just by spending 10 VERY enjoyable minutes a day with ETR’s new Words to the Wise CD Library.]
Michael Masterson
Copyright ETR, LLC, 2007