Surviving Superstorm Sandy...and the Markets

Hurricane Sandy certainly lived up to its reputation of being the "perfect storm"...

In fact - a Superstorm that is possibly the worst in US history, with tens of millions being affected in one way or another, some tragically - and ones thoughts are with all those as they go through this time.

While looking at updates on Tuesday morning, it suddenly struck me - Yes, this is REALLY BAD, but just imagine HOW MUCH WORSE it would have been if there had been...

NO WARNING ...NO FORECAST

...NO knowledge of its expected path and intensity

...NO predicting of the breadth of the storm,

...NOR of its expected landfall, storm surge levels and duration?

....In short - NO OPPORTUNITY or TIME to TAKE ACTION

It would have been absolute DISASTER! Probably 100 fold more than is now expected.

But, instead, having this forewarning days prior to the disaster made all the difference.

Because of the accurate weather-tracking and forecasting systems that were available, President Obama could say the following on Monday:

As one of the hurricane experts said this morning: 'Thank goodness we believed what our computer models were telling us. This is just as bad as it said it was going to be'.

With potentially 50 million persons likely to be affected, having sufficient warning of what was expected gave these persons the opportunity to prepare and take action to protect themselves, their loved ones and their property to the extent that they could.

The difference that this made - compared with being taken by surprise (when it was too late to act) - is INESTIMABLE.

Easier said than done, I know.

But because of this knowledge, skill and technology, persons could take the necessary life-saving actions.

That is the power of forecasting, using historical patterns to predict future patterns. And how and why can they do this with such a level of accuracy?

And the more analysis has been done understanding previous patterns and what influences them, the better these experts can forecast future patterns.

BUT, now to get to the real crux of this post...

And just as the weather moves in law-abiding patterns of creation, so financial markets move in similar law-abiding patterns...

...as they reflect the underlying mass sentiment of those persons active in the market at that time.

The fact is - we are emotional creatures who act based on our emotions, and then use logic to rationalize our decisions thereafter.

And we are no different emotionally than our ancestors, and we tend to make the same decisions they made back then in similar circumstances - because that is how we are created.

And these law-abiding patterns of emotion, which are merely reflected in the price-action of markets, repeat themselves over and over again, in smaller and larger degrees.

So, through understanding the laws that move the markets, and by analyzing hundreds and thousands of historical patterns of market movements, we are able to analyse a current market

...compare it with historical patterns of similar degree and characteristics ...and provide a probable picture for the future.

And the technology we have used to provide forecasts works on exactly this principle.

And just as having the forewarning of Superstorm Sandy allowed persons to take the necessary actions to protect themselves...

...so having a forecast that gives you a picture of expected future market movements allows you to take the necessary action to protect yourself...

...before it is too late to do so.

Of interest, President Obama in his address also directed the population to the website Ready.gov to assist with any additional information they needed in terms of how they could prepare for this storm. Looking it up, the first thing that hits you is a heading:

Well, just as the US population were informed beforehand so they could be ready for tomorrow, we recently predicted the next storm on the Rand...before it hit landfall early this month...allowing those that had wisely stayed informed to take action - before it was too late.

Here is a quick before and after picture, showing our forecasts for the next few months, the next few weeks and the next few days in September - and the resultant movements.

[Click the image to see the full picture or here to see the actual forecasts for these 3 periods, the charts and write-up. [Remember, a free signup permits you to the full history of short, near and medium term forecast updates leading up to and beyond this one. Not signed up? Signup here]

If you have any exposure to Rand movements, you will readily see the power and advantage of having this information at hand, so you can make informed decisions. And actions.

Which is exactly what prompted Wynand Coetzer to send us the following in the past week:

With over 80% historical accurate track record.

But then, as President Obama implied, failure to heed the warnings and to take the necessary recommended actions would potentially have devastating and fatal consequences. And so it is if we are exposed to Rand fluctuations and, instead of staying informed, we instead decide to just take things as they come.

The first steps of survival are:

And as a result - More peace of mind and more confidence in what the future holds.

... and that you have taken the actions required to protect yourself.

... Ahead of time.

We will continue to do our best to keep valued subscribers informed going forward (get more details of our service here).

To your success~

James Paynter