Technology is literally changing our world on a daily basis and it is only going to accelerate exponentially in the future.  In fact, there is even a law called Moore's Law that says that the processor side of this equation will continue to double every 18 months, and it has since this law was announced in 1965.

Many people over the years have proposed that there would be an increase in technology as the end of times approached. Among those espousing this view were renowned scientists Isaac Newton and Francis Bacon. On the frontispiece of Bacon's Instauratio Magna, ships of learning were depicted passing by the limits of human knowledge, with a quote in Latin from Daniel 12:4 which stated "But you, Daniel, roll up and seal the words of the scroll until the time of the end.  Many will go here and there to increase knowledge."

In more recent times, this belief has been supported in books like Future Shock by Alvin Toffler and The Bible Code by Michael Drosnin.

In my meetings with clients, I find far too many that are not keeping track of where technology is going, especially among baby boomers and seniors.  It takes constant work and a desire to keep learning not to be displaced by the very technology that is meant to make our lives simpler.  Sadly, I see far to many Americans with their head in some video game or watching Netflix and not learning how to stay relevant in this fast moving time.

So with that in mind, this month I wanted to share with you some inspiring videos that I found particularly eye opening over the summer.  My hope is that they will inspire you to think big, to focus on mastering this new technology and to stay ahead of the curve that I believe will radically change our society in the years ahead.​
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Let's start with one of the biggest thinkers in America today, Elon Musk.  The things he is doing in his various companies boggles the mind!
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Next, if you have been following the investment news at all you may have noticed a new type of currency called Bitcoin is skyrocketing in price.  Since any currency is only as good as the faith that is bestowed on it, unless it is backed by some kind of collateral like gold, there has to be something that makes the currency appealing?  

The answer it appears is that this new digital currency is built using an entirely new distributive digital platform that makes it significantly harder to manage or manipulate than other currencies, like the U.S. Dollar, that are controlled by a central group or government.  This new platform makes it near impossible to change without the system noticing it has been changed and thus builds trust among those who use the currency for commerce that they have entered into a fair transaction with fair remuneration.

I believe this new distributive way of managing data, called Blockchain, will have a profound affect on the way not just digital currency ledgers are kept but everything we potentially manage that has data attached to it.  

Ritchie Etwaru has done the best job I have seen of explaining this new technology and how it works in a way most of us can understand.
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Tesla's CEO Elon Musk fired off a new and ominous warning recently about artificial intelligence, suggesting the emerging technology poses an even greater risk to the world than a nuclear confrontation with North Korea.
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Musk—a fierce and long time critic of A.I. who once likened it to "summoning the demon" in a horror movie—said in a Twitter post that people should be concerned about the rise of the machines than they are.
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Ironically enough, it was OpenAI's own technology that managed to beat two professional eSports players at a major tournament, after only two weeks of practice. The Dota 2 contest is known to be extremely complex, pitting two teams against one another in a virtual battle arena.  After this tournament, Musk posted what appeared to be a photo of a poster bearing the chilling words "In the end, the machines will win."

The question is will Ai become man's greatest challenge or does it simply allow man to be more productive?  The jury is still out on that question, but we believe Ai and the machines it's spawning have the ability to profoundly change our world.

As you will see in the videos below, it has already changed the landscape in such industries as agriculture, which used to employ hundreds of thousands of workers that have since been displaced by technology.

You may have read recently that Amazon purchased Whole Foods.  It is speculated that Amazon will introduce same day delivery of prepared foods and automated checkout technology that could see the front end of grocery chains devoid of cashiers.

My wife works at Publix here in Tampa as a Floral Stylist.  I have joked with her that the future has her as the only human in the front end of Publix.  The majority of her job takes creativity and that is something that technology cannot replace.  She, of course, is not amused!

So as you watch these next two videos think about the ways Ai could change your profession?  It has already changed and is changing the financial services profession forcing lower fees, more focused planning and a move towards clients with greater sophistication to stay ahead of the roboadvisors.
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Is it any wonder that the majority of robots in industry today (see chart above) are in high wage states?  I think this trend will only continue.

I hope I have spurred you to think bigger about the future.  Maybe to take that class on the latest version of Windows or some software application that you have been meaning to take.

Technology has the ability to radically change our world!  I for one believe that if you are mindful and plan on the change, you can stay ahead of that change and benefit from the technology revolution that is upon us!

Let me know your thoughts in the comment section below.

​The business cycle is something that cannot be cheated.  It can be extended as our Central Bank has been instrumental in doing.  

The current business cycle just celebrated its 101st month in July. 
 
That is the third longest in history so far!
 
I would hazard to guess that by the time this cycle ends, it will own the number two spot in history at over 106 months and maybe the top spot at over 120 months.  Only time will tell!
 
The typical stock market cycle usually tops (and bottoms) about 6-12 months ahead of the economic cycle, as you can see in the previous diagram.
 
As many of you found out in the last Great Recession everything from your job security to the market price of your homes can be affected by such recessionary cycles, especially when our Central Banks are creating economic bubbles.
 
So, to help you in planning for the next such economic downturn, whether it is next month or next year, here are five ways you can prepare for the next downturn:
 
1.       Build an emergency fund
 
It is prudent to have on hand 3-6 months of living expenses in the bank in cash or on deposit in case you have an emergency need for such funds from such things as job loss, unexpected illness or other emergencies.  Now is time to grow that fund if you do not currently have an emergency fund.
 
A great goal to start with is the simple goal of putting $1,000 in the bank.  7 in 10 Americans have on $1,000 or less in their savings account per a recent survey.  So just reaching the $1,000 market would put you in the upper 30% of Americans. 
 
Next, set your sights a little higher and reach for that 3-6 months of living expenses in the bank.
 
2.       Reduce debt levels
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When economies go into recession, jobs are lost, raises are forgone, leveraged deals fall apart, and opportunities vanish for much of the country.  It is a great time to be in a position where you have the flexibility to accept a pay cut and keep your job or even transition if you must to a lower paying job to continue to support your family.  You cannot do this if every dollar you currently earn is consumed by either debt or lifestyle. 
 
A simple way to attack debt is to do a debt snowball!
 
The debt snowball is where you pay the minimum on all your outstanding debt except for one loan.  On this loan, you pay something extra to pay it off as fast as your cash flow will allow.  When you succeed in paying off that loan, apply what you were paying on that debt on the next piece of debt to accelerate its repayment until you have paid off all your debt.
 
Remember, start with the high interest rate consumer debt first and then move to lower rate debt, including your mortgage if you so choose.
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3.      Adjust your lifestyle
 
Another simple thing you can do today to prepare for the coming economic recession is to adjust your lifestyle.  Now is the time to start budgeting your spending and knocking off any unnecessary expenses that you don’t really need, such as that gym membership you keep planning to use but never do.

​If you can better bring your lifestyle into line with your income, you will enhance your ability to weather the storm when the next recession threatens.
 
4.      Develop exit or hedge strategies
 
Now is a great time to make sure your advisor(s) have your back.  When the next recession comes, we speculate the markets could lose one-half or more of their value.   
 
What is his or her exit strategy?  If they don’t have one, it is time to find a new advisor.
 
Although stock markets have proven they can and will recover, the question is do you have the time in your planning to wait on that recovery?
 
The average investor waited five years to get back to breakeven following the Great Recession.  If you are a baby boomer today, you may not have enough time left until you need those funds to wait on such a recovery.
 
Most Americans are under saved for retirement so moving to a more conservative allocation may not help you in the long run, plus bond yield are at 30 year lows.  What are the odds bond yields continue to fall from here?  

​In our opinion, you need to be willing to trade out of the market when it is in a confirmed bear market.   Without the right tools and models, these can be difficult to identify for the average person or adviser.
 
5.      Change your mindset
 
I hate to say it but economic recessions provide opportunity to those with the cash reserves to take advantage of them.  Yes, you are in a way preying on someone else’s poor fortune but chances are they failed to plan ahead like you when they had the chance.
 
In the last Great Recession fortunes were made by those who purchased marked down equities at the bottom or real estate at distressed prices. 
 
Will you be the victim in the next recession or the victor?

Let me know if you have comments or can think of other creative ways to prepare for the next economic recession.