Right on the Money: Doug Casey on Economics, Investing, and the Ways of the Real World with Louis James

Chapter 8

Doug Casey on Winning Speculations

December 16, 2009

Louis: Doug, these conversations are going out to a wider and wider audience—almost 100,000 now. A lot of these readers are new to our style of investing. They’ve heard of your 30-year track record of picking winning investments, and many are wondering how you do it. Can we tell them the secret?

Doug: Well, it’s not really a secret. I have a method for picking resource stocks and other speculations; all our analysts at Casey Research use it. We even have a free report on our website describing this method, called The Eight Ps of Resource Stock Evaluation. We try hard to educate our subscribers in using this method themselves, and encourage them not to follow our recommendations blindly. Our goal is to educate subscribers in all the important aspects of our business: geology, engineering—all aspects of the markets. We make a lot of investment recommendations, but we don’t just tout stocks—it’s not like being a railbird at a racetrack. Each speculator has different amounts of capital available, different tolerance for risk, different areas of interest, and so on. But it’s not just about knowledge; it’s critical to have a method of some description. And to exercise discipline.

But before we get into that, let’s talk about speculation itself.

L: As distinct from investing.

D: Yes. Properly speaking, investing is the act of putting capital into a business in anticipation of making a profit. Sounds easy and simple, but ...