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The Mindset You Need to Survive a Bear Market

If you believe the stock market is rigged against you… you’re not alone.

Bankrate recently surveyed 2,525 Americans about the stock market. And 56% of investors surveyed agree that “the stock market is rigged against individual investors.”

I’m surprised the number isn’t higher than that…

As you can see below, the average Joe has done worse than just about everything else over the last two decades…

The data in this chart only goes to 2020. With the beating the market is taking this year… it’s likely the average investor is doing even worse today.

Yet, since 2016, our entire Palm Beach Letter model portfolio – warts and all – has posted an average annual return of 154%, compared to the S&P 500’s 13%.

So on average, we’ve beaten the broad stock market index more than 11 times every year since 2016… despite all the volatility.

But you don’t even need to subscribe to my paid services to make market-beating gains…

Over the last five years, my free crypto picks alone have averaged peak gains of more than 1,500%.

Now, it’s not all roses, of course. We’ve also had a few setbacks in 2022.

For instance, my bitcoin miner portfolio is down sharply… and that stings.

I fully expect the bitcoin miners to recover and surpass their all-time highs – just as they’ve done in the past.

I don’t tell you all of this to brag. But you might be surprised to know that you can make the market work for you – even now – if you have the right mindset.

And if you can grasp the concepts I’ll show you today… you’ll be able to rig the market in your favor.

Are You an Investor or a Trader?

The first thing I learned about making money in the market is the difference between being an investor and being a trader.

An investor puts their capital to work over the long term. Their goal is to consistently beat the annual return of the S&P 500.

As I told you on Monday, I do this by buying safe, blue-chip stocks that pay solid dividends. I then reinvest the dividends each year into other investments that can compound my returns even more.

Traders try to time the markets to make quick profits.

Now, there’s nothing wrong with trading. I do it myself.

The key here is that I only use a portion of my “safe” income to fund these more speculative trades.

All of my earned income (from my work) goes into safe income-producing investments such as blue-chips and conservatively financed income-producing real estate deals.

This approach keeps my initial money safe while throwing off an ever-growing river of income I can redirect into higher-yielding ideas.

And it’s the same investment philosophy I apply across my newsletters.

In the Palm Beach Letter, I recommend safe blue-chip stocks that pay solid dividends or world-class assets that will appreciate over time.

We then use a portion of that safe income to put in more speculative plays like altcoins, cannabis, options, etc.

As my track record indicates, this process has worked well for my subscribers over the years.

Since I took over the Palm Beach Letter in 2016, we arguably have the highest rate of return of any other newsletter in the world.

Of course, there will be days, weeks, and even months when the process looks broken.

That’s when you rely on the track record of the guy who’s successfully navigated every single crash over the past six years.

Within a year of each sell-off, my market calls have looked prescient in their ability to make my readers money.

Of course, these corrections are unpleasant… no matter how much handholding I provide. That brings me to my next lesson about the markets…

Volatility Is Your Friend

The other lesson I had to learn was you must embrace volatility… Because it’s always there to some degree. You can’t remove it from the market.

In fact, if volatility disappeared from the market, you wouldn’t make money over the long term.

Volatility is like a forest fire.

Think about it…

Despite the terrible toll forest fires can take on society… they actually make our forests healthier.

Fires consume the weaker trees and the undergrowth. The stronger, more stable trees that survive have less competition for water, more nutrients, and greater room to grow.

The result? They thrive.

Volatility clears out the clutter. That makes it easier to identify the saplings that’ll grow into giant redwoods in the next bull market.

Without volatility, the market would stagnate. There would be few growth opportunities.

In fact, the last time we saw a sideways market like this was from late-2014 through most of 2015…

So, the market essentially drifted nowhere for about 9 months prior to the “Flash Crash” in August 2015 (a painful combination of market weakness and a lack of liquidity).

The key takeaway is that markets need volatility like forests need periodic fires.

Volatility is painful. But it’s also healthy for the market. The key is to embrace it and use it to your advantage.

How to Survive a Cyclical Bear Market

Friends, even amidst the worst crypto market since 2017, my readers have had the chance to book a 71,010% gain last month.

And just last week, they had the chance to book crypto gains of 884%, 468%, and 327%.

These aren’t back-tested results. They are real gains realized by real people.

They achieved these gains because they followed my advice…

Use volatility to invest in high-quality ideas at a discount. Then hold those high-quality ideas for the long term.

Of course, we’ve had our strikeouts along the way. But a 71,010% gain goes a long way in wiping out those misses.

This proves that having the right mindset will help you build wealth over time. And it’s a message I want you to internalize right now.

As I’ve been warning since the beginning of the year, we’re entering a “cyclical” bear market. That’s a short-term downtrend within a long-term “secular” uptrend.

I believe this cyclical bear market will last the remainder of the year. And the secular bull market that began in 2009 will resume in 2023.

My job now is to get you through the tough months ahead. It’ll be ugly. It’ll be painful. It’ll be uncomfortable.

But if you have an investor’s mindset and embrace the volatility… you’ll rig the market in your favor.

And unlike the average investor, you’ll consistently beat the market year after year after year.

Let the Game Come to You!

Big T