Sustainable Wealth: Achieve Financial Security in a Volatile World of Debt and Consumption [Hardcover]

Axel Merk (Author), William Poole (Foreword)

Book Description

Publication Date: October 26, 2009

A personal finance guide for today's turbulent world

Sustainable Wealth empowers you to achieve your financial goals by unleashing the shackles of debt, no matter how uncertain the future may be. Filled with in-depth insights and practical advice, this reliable resource illustrates how you can predict economic booms and busts before they happen, adapt to changing markets and plan for lasting financial stability.

Over the course of his career, Axel Merk has been at the forefront of identifying major trends, a leader in the public policy debate on how to fix the economy, and guide for investors looking to navigate the global credit crisis. With this new book, Merk puts your financial decisions in a global context and shows how factors ranging from the Federal Reserve and Congress to trends in Asia and Europe influence your financial well-being.

• Coaches you how to recognize major economic trends before they happen
• Puts forth a plan to help you cope with expenses and save for retirement, while building a legacy of wealth, not a mountain of debt
• Reveals why "staying the course" when governments or markets change the rules may be hazardous to your wealth

As investors struggle to adapt to the new financial landscape, Sustainable Wealth provides straightforward answers to the tough financial questions we face-and the tools to achieve a financially sustainable lifestyle.

Editorial Reviews

From the Inside Flap

The world has endured an economic crisis of epic proportions—the biggest since the Great Depression. Trillions of dollars in accumulated wealth lost, gone forever. That crisis reminded us once again how quickly economic crises can strike and how bad they can be.

You're a wealth builder. You work hard, and you want to have something to show for it some day. You want to send your kids to college, to plan a comfortable retirement, to sleep comfortably at night, and to achieve financial peace of mind. You want to use debt prudently, if at all, and have the ability to do what you want—financially—come hell or high water.

What should you do to ensure that the next financial calamity stays clear of your backyard? That's where Axel Merk's Sustainable Wealth comes in.

Over the course of his successful financial career, author and fund manager Axel¿Merk has led the way in identifying major economic trends before they occur. Most importantly, he has been a guiding light for investors and individual wealth builders to navigate economic crises like the recent global recession. Now, with this timely new book, Merk puts your financial decisions in a global context, showing you how "big picture" factors can influence your financial well-being.

Part I of Sustainable Wealth helps you understand the dynamics that drive this world and how they may affect your finances. Here, Merk skillfully discusses the world we live in, by highlighting the temptations of our society: the temptations of credit, consumption, policy change, and complacency. Rather than be left scratching your head about the meaning of the last Fed decision, you'll learn how the world really works and what it really means for you and your wealth.

In Part II, you'll discover how to apply these lessons to your personal finances. Merk highlights that everyone should be challenging the conventional wisdom. He then illustrates how to save, spend, and invest in a volatile world, providing clear, straightforward advice should you and/or the economy be faced with a crisis.

Filled with in-depth insights and practical advice, Sustainable Wealth:

• Reveals why "staying the course" when governments or markets change the rules may be hazardous to your wealth

• Coaches you on how to recognize major economic trends before they happen

• Offers a plan to spend, save, and invest wisely in the face of an uncertain world, build a financial legacy, and achieve peace of mind

As you read Sustainable Wealth, you'll quickly be able to understand—and adapt to—today's erratic and rapidly changing markets. Financial peace of mind. That's what this book is all about.

From the Back Cover

Praise For Sustainable Wealth

"Finally an easy-to-read but very comprehensive study on investments in a world where sadly common sense is no longer so common—and short-term profit 'temptations' overwhelm the discipline of building sustainable wealth."—Marc Faber, Editor, Gloom, Boom & Doom Report

"Maybe had Congress gotten this book before this financial crisis, we wouldn't be in this crisis. But alas, we are, and alas, there's hope. Axel Merk not only shows Washington the way out, but more importantly, the rest of us too. Not with a lecture, but a plan, and a damn good plan, without the bull and without the jargon. It's why I love this guy. He really means it when he says he's looking out for the rest of us guys. In Sustainable Wealth, he proves it."—Neil Cavuto, Sr. Vice President and Anchor, Fox News Channeland Fox Business Network

"The right financial decisions are always essential, but become particularly important in today's turbulent times. Preparation and knowledge are required to protect you and your family, and this book provides everything you need to develop a sound plan for the future."—James Turk, founder and Chairman, GoldMoney.com

"It's hard to accumulate wealth without making many costly mistakes along the way. That has never been more true given the enormous financial risks we see today. This book may help you avoid them."—Bill Fleckenstein, Fleckenstein Capital

"Axel Merk's Sustainable Wealth is a storehouse of historical and current investment information—clearly written and packed with valuable information. I recommend this book without reservation."—Richard Russell, Publisher, Dow Theory Letters

See all Editorial Reviews

Product Details

• Hardcover: 257 pages
• Publisher: Wiley; 1 edition (October 26, 2009)
• Language: English
• ISBN-10: 0470496584
• ISBN-13: 978-0470496589
• Product Dimensions: 6.5 x 0.9 x 9 inches
• Shipping Weight: 1 pounds (View shipping rates and policies)
• Average Customer Review: 3.2 out of 5 stars  See all reviews (17 customer reviews)
• Amazon Best Sellers Rank: #655,049 in Books (See Top 100 in Books)

More About the Author

AXEL MERK is the President and Chief Investment Officer of Merk Investments LLC, an SEC registered investment advisory firm that manages mutual funds specializing in currencies. He has published many articles describing complex economic phenomena in understandable terms and is a frequent expert presenter and moderator at conferences. Merk is a sought after voice for financial news shows, known for his understandable advice and uncanny ability to predict market movements. He is a regular guest on CNBC and Fox Business, and frequently quoted in Barron's, the Wall Street Journal, Bloomberg News, USA Today, and the Financial Times.

Most Helpful Customer Reviews

21 of 23 people found the following review helpful

4.0 out of 5 stars A financial planning book for the economic chaos. November 8, 2009

By photondn

Format:Hardcover|Amazon Verified Purchase

Axel Merk's Sustainable Wealth is a financial planning book for the Depression-like economic times. This book is a good introduction to sustaining whatever wealth you have left after your wealth was squashed by the economic collapse.

The highlights of this book were the following:
- How public policy is killing economy recovery.
- How social complacency and hubris lead to the slow downfall of the American economy
- Making the distinction between conventional wisdom and true wisdom.
- Getting a grip on one's expenses and debt and concentrate on building wealth.

This book reminds me of Kiyosaki's Rich Man, Poor Man from long ago as a financial planning book. Although it spends a considerable portion to the historical events leading up to the economic collapse and somewhat psycho-analyze why people did what they did that contributed to the economic collapse, This book ultimately focuses on modifying one's behavior to cope with the current economic conditions and build one' wealth.

The strength of this book is that it attacks conventional wisdom toward investing and stresses to be skeptical of current public policy that is targeted to fix the current economic problem. In other words, don't buy into conventional mainstream wisdom and don't rely on public policy to save you. It encourages to keep your eyes peeled to changes in the economic landscape, and consider various ways to preserve one's wealth. I am glad that this book targets conventional wisdom, complacency, and current public policy, all of which I thought were lacking in other gloom-and-doom books.

This book is quite concise, but it is a good intro to describing to the unsophisticated as to what is going on and what to do think and do next.

If you're the kind of person who bought a house two years ago, bought a brand new car, maybe took a home equity loan, ignored your chicken-little friend's warnings two years ago, slowly watched your net worth go into the red, now your chicken-little friend might have been right after all, and slowly realizing that your ship is nearly sunk, this book is probably for you. If you're having doubts that the economy is not as good as what the mainstream media is leading you to believe, this book is probably for you.

46 of 55 people found the following review helpful

1.0 out of 5 stars One tired cliche after another October 30, 2009

By C. W. Rogers

Format:Hardcover|Amazon Verified Purchase

I have been looking for a way to transfer my money out of dollars into some other currency legally and easily which I thought would be addressed in Axel Merk's new book. He appeared on Fox Business News on Nov. 18 during which interview he advocated investing in a basket of foreign currencies such as the Euro, Swiss Franc, British Pound, etc.

Thinking a method to accomplish this would be described in detail in "Sustainable Wealth", I rushed to buy a copy. Alas, the book was crammed with endless cliches about invest wisely according to your own needs, be flexible, invest only what you can afford to lose and so on and on plowing old ground over and over. No mention was made on how to invest in foreign currencies, only that it was a good idea to do so.

9 of 10 people found the following review helpful

1.0 out of 5 stars Good start, empty middle, bad end August 1, 2010

By Jordan M Frank

Format:Hardcover

At the beginning of the book Axel starts by offering some good education and current context for macroeconomics. I figured the rest of the book would flesh out some of the macro-economic issues and offer some solid advice on portfolio planning.

To the book's credit, it advocates:

- Reduction of personal debt
- The benefits of compounding on your savings (vs. the atrocious outcome of compounding against debt)
- Balanced portfolios
- Consideration that action at the extremes (like the current crisis) can even sink a well balanced portfolio - so you need to invest in safety.
- If people are getting over-confident (in stocks, in gold, in housing...) its time to buck conventional wisdom and get out.

But here's where I was very frustrated and upset by the book:

- The introductory parts had some very good information about the relationship of interest rates, borrowing, inflation, deflation, policy and so on (macro-economic stuff) but these ideas were not explored enough to take me anywhere close to a text book understanding of the concepts. My next book: Macro-Economics (the 101 kind).

- Merk feels it necessary to berate Obama's spending policies with claims that they are unproductive and will leave us with too much debt + the likelihood of inflation (an unsustainable condition). He has a key theme here on not spending beyond your means. However, it's impossible to form a valid argument saying that the current stimulus program was not effective. There is no control animal so there is no basis to say whether a different approach (or no approach) would have gone better. Any opinion on the matter is pure speculation.

- Near Merk's conclusion he talks about choosing gold vs. stocks for his kids' college savings. Despite gushing over the wonderful tax savings of a 529 (he says you should almost always jump on tax savings) he says he chose gold instead of a stock filled 529 because his portfolio was already over-weight on stocks. Huh? If you love gold, sell your stocks and buy gold for your own portfolio, then max out the 529 with stocks (or whatever they let you invest in) to get the tax savings.

- Merk suggests we all become masters of our own portfolios and study up on economic issues. I think its this kind of armchair quarterbacking that got so many "investors" in trouble in the last bubble and collapse. Same for the internet bubble. Everyone and their brother had their own idea about what stocks are best and where the "gold" is. As the book would content, everyone was too optimistic and complacent which is a sure sign of a bubble. So, its best that we all get humble and specifically avoid trying to become experts at all. Think a moment about the world's best experts today - they're divided on whether we will have inflation or deflation. If the experts can't agree (and thus many or most of them are wrong) then how can mere financial mortals make a good call? Its best we all have well balanced portfolios that can withstand economic pressures. The book should end with a reminder to get (mostly) out of debt (see next point) and shoot for a balanced portfolio. Then it should indicate what a balanced portfolio should look like in terms of currency, bonds, stocks and other investments.

- Getting out of net debt is different than getting out of debt, and being in debt may be better than being stuck with all your money in a single asset class like real estate. Imagine you have $100K and need to buy a $200K house. If you follow Merk's advice you would probably put down $100K and then pay down the other $100K as soon as possible so that you carry the least amount of debt and start to save as soon as possible. But then you have no financial flexibility in case of emergency AND all your assets are in one basket (your house). In 2003, you would have been better off putting in the necessary $40K down payment and putting the rest in gold (until now) or the stock market (until 2007). To put this in another time context, if you bought your house in 2007 (depending on your house's location in the country) you would see 35% to 65% of your principal go poof in 12 months - you would have been better with debt + cash on hand in order to buy a stock or another property come early 2009 when things had bottomed out). To illustrate further with consideration of net-debt... Imagine you need a $200K house and have $500K in savings. Should you spend $200K on the house and be left with $300K to save and invest? Or should you take out a $100K home equity loan or mortgage so you can invest it elsewhere? In today's market where interest rates are low, i would certainly argue that you take that bargain as a means to keep a portfolio balance in real estate (your house) which is < 1/5th real estate. Personally, I am about to take on additional home equity loans in order to invest in other real estate so that I can diversify my real estate holdings rather than be overweight in a single holding (my house).

In sum, the book should have gone deeper on the principles and more specific on investing strategies rather than hitting generalities nicely without enough substance, then going on with self congratulating stories that prop up Merk's authority by reminding the reader of his own lucky strategy with Gold (while failing to take advantage of 529 tax advantages) and lucky move to basically risk all his own assets to start a mutual fund.

If I had stopped reading at page 80, I probably would have loved this book.