2019 Will Make You Work Hard For Your Money

Ah, that sinking feeling.

You open the pantry door, but alas, nothing is looking back at you. Well, nothing that takes your fancy, anyway.

Across the sparsely filled shelves are all the things that you would never eat. Until now, that is, when there is nothing else in the house.

Your eyes fix on a can of baked beans. Perhaps you might have them on a bit of toast. But the only bread you can find are some ratty old crusts. It looks like something has been nibbling on them.

Behind the baked beans is a tin of corn kernels. And next to that, a tube containing some type of paste. Perhaps you could put that on one of those stale biscuits you can see on another shelf.

After the long commute home, the last thing you want to do is get in the car again and head out to the shops.

No, you’re going to work it out.  You’re going to make do with what you’ve got.

We’ve all been in that situation. Starting out in your first digs. Or much later, when there are a stream of kids — some your own — methodically demolishing every bit of food in the house.

You had enough to get by, perhaps, but always felt like you were one paycheck behind. But, here you are…you always worked it out. What choice did you have?

While nobody wants a downturn, or a sluggish economy, we have seen it all before. Who hasn’t had to go without?

Like the dear old remaining souls in the UK, who grew up under the shadow of the Second World War. What could they possibly fear about Brexit?

After one of the greatest asset bubbles in history, the global economy is now trying to adjust itself back to normal. Though what ‘normal’ is anymore, is anyone’s guess.

And after doubling, and then doubling again, house prices in the major capitals of Australia have run out of air. Those with deep pockets now sit and wait to pounce.

And interest rates — once the thermostat of the economy — have gone so low that any further cuts cease to have any impact.

Ratchet them up, though, even a quarter of a percent or two, and watch how quickly the wheels start to fall off. Wage growth doesn’t mean a whole lot if unemployment starts to tick up.

Revealed: The truth behind our ‘unofficial’ GDP. Download the free report today.

2019 is going to be an interesting year

China will have one last crack with another huge stimulus package — something that will give our market another burst next year. But we will also likely see a change in government here next May.

A new government, one that will unleash a rash of new spending, and tax those who generate real wealth. It will artificially manufacture wage growth by fiddling with the award system. Wage claims will break out all over the place…good luck if you are not in a union. 

This will all happen at precisely the wrong time in the cycle. Right at the top, or more likely, coming down the other side — rather than when the economy is accelerating.

The Royal Commission did its job. But now, banks are too scared to lend.

And all those company directors? They are all now too scared to direct. After watching the daily humiliations at the Commission, who would seek nomination for a seat at the board?

Banking and financial services this year, a Royal Commission into the aged care industry coming up next. Who’s turn is it after that, when both these commissions are complete? Those that remain on boards will become even more hesitant than they are right now.

And that means lower investment in their business, in case they stuff it up.

Yes, 2019 is going to be an interesting year. A year that rewards those with an older head on their shoulders, and those who have gone without.

It will be a year of knuckling down and making your assets work as hard as they can to generate income, as asset growth becomes a thing of the past for now.

I wish you all the best for the Christmas and New Year. I, for one, cannot wait for another year to roll around.

Matt Hibbard

Editor, Options Trader

Free Guide: Australia’s ‘Unstoppable’ Economy. Download now.

While many investors chase quick fire gains, Matt takes a different view. He is focused on two very clear goals. First: How to generate reliable and consistent income in a low-interest rate world. And second, how you can invest today to build wealth over the next 10–15 years. Matt researches income investments. You can find more of Matt’s work over at Total Income, where he is hunting down the next generation of dividend-paying companies for the future. He is also the editor of Options Trader, where he uses basic options strategies to generate additional streams of income beyond the regular dividend payments. Having worked for himself and with global firms for almost three decades, Matt has traded nearly every asset in existence. But now he is on a very different mission — to help investors generate income irrespective of what the market is doing. It’s about getting companies to pay you a steady, stable income, with minimal stress and the least risk possible. Matt doesn’t believe you have the luxury of being a bull or a bear in the market right now. You have to earn an income from it, regardless of whether stocks are going up or down. By getting the financial markets to pay you an income, you can get to focus on more important things than just money.

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