Why Robert Koke would have made a fortune in ‘pot stocks’

Wednesday, 6 September 2017
Melbourne, Australia
By Bernd Struben

  • A true visionary
  • The next leg up for pot stocks
  • ‘Listed pot stock ranks to fire up’
  • The unshakeable Grand Cycle

You’ve probably never heard of Robert Koke. Bob to his friends.

He was born in 1910 to Dutch immigrant parents. They came to the US with the last name Kok — cook in Dutch. On arrival, they were helpfully informed they would do well do amend their name to ‘Koke’.

Bob spent his early years in southern California. He earned a living as a photographer and tennis coach. Greta Garbo was one of his students. And he counted Charlie Chaplin as a good mate.

In 1936, he travelled to Bali with his wife Louise. They fell in love with Kuta beach. Shortly thereafter they opened the first tourist hotel on Kuta…the Kuta Beach Hotel.

Though only an amateur surfer himself, Bob was the first man to surf the swells of Kuta. And the first man to offer surf rentals and lessons to tourists on the island.

That’s Bob on the bottom left picture below. On the right are two of his hotel workers, with the boards they used for surfing lessons.



chart image

Source: The Surfer’s Journal
Click to enlarge

He may well have lived his life out there, if not for the Second World War.

In 1942, just ahead of the Japanese invasion of Indonesia, the Kokes fled. Louise returned to the US, and Bob joined the US army before being recruited to the Office of Strategic Services (OSS).

The OSS, as you may know, was the predecessor to today’s Central Intelligence Agency (CIA).

The Koke’s Kuta Beach Hotel was destroyed in the war. So, he stayed with the CIA for the rest of his working life, until retiring in McLean, Virginia.

Which is where I eventually met him.

More, after a look at the markets.

Markets

Overnight, the Dow Jones Industrial Average fell 234.25 points, or 1.07%.

The S&P 500 dropped 18.70 points, or 0.76%.

In Europe, the Euro Stoxx 50 index closed down 9.56 points, or 0.28%. Meanwhile, the FTSE 100 lost 0.52%, and Germany’s DAX index gained 0.18%.

In Asian markets, Japan’s Nikkei 225 index is down 28.48 points, or 0.15%. China’s CSI 300 is down 0.07%.

In Australia, the S&P/ASX 200 is down 25.73 points, or 0.45%.

On the commodities markets, West Texas Intermediate crude oil is US$48.53 per barrel. Brent crude is US$53.12 per barrel.

Gold is trading for US$1,3338.88 (AU$1,674.86) per troy ounce. Silver is US$17.88 (AU$22.37) per troy ounce.

One bitcoin is worth US$4,505.84.

The Aussie dollar is worth 79.94 US cents.

A true visionary

Bob and Louise Koke retired to a house on three immaculately manicured acres. In 1979 they were on the lookout for a new part time gardener. Your editor, at the age of 11, leapt at the offer. And worked on the estate — on and off — through 1993.

I don’t bring this to your attention just for a trip down memory lane. I bring this up because Bob Koke was a true visionary.

In 1979 the US war on drugs had already been raging for years. And it was still heating up. So you can imagine my surprise when this retired gentleman told me that the drug war was a huge mistake. One destined for failure.

Bob never tried drugs himself, though he enjoyed the odd glass of wine. But he was adamant that the only solution was full legalisation of all narcotics.

Now here we are, 38 years later, and governments are still fighting an unwinnable war against most drugs.

I say most, because as you know marijuana is slowly gaining acceptance as a legitimate medicine. And even for legal recreational use.

Australia opened the door to medicinal marijuana last year. Canada looks set to fully legalise its use in 2018. And, state by state, cannabis is gaining traction in the US.

29 US states now have medicinal marijuana laws in place. And eight states allow for legal recreational use. This adds up to almost 60% of Americans living in states where some form of marijuana is legal.

This is what Sam Volkering calls ‘Phase I of the pot stock boom’. It’s a boom that saw stocks like Global Hemp Group [CNSX:GHG] surge 680%. While OWC Pharmaceutical Research Corp [OTCMKTS:OWCP] gained an astonishing 4,809%.

Which is why I say, if Robert Koke were around today, he would have made a fortune in pot stocks!

The next leg up for pot stocks

Clearly early investors in the right marijuana companies have been laughing. Though I should note that plenty of start-up pot stocks have gone backwards, or even folded.

You can’t just roll the dice and pick any old one. Which is where Sam’s expertly researched advice can make all the difference between small gains — or even losses — or scoring a series of ten-baggers.

As mentioned above, almost 60% of the US population now live in states where marijuana — medicinal or recreational — is legal. This also means that more than 40% are still to follow suit.

Not to mention the highly likely move to legalise cannabis in Canada next year.

Now, you may think this is all old news. And if it’s in the news, it’s in the price.

While there’s a lot of truth to that adage, the difference here is that it is indeed ‘old’ news. And investors are a notoriously fickle and impatient bunch. Which has seen many promising pot stocks retrace as the initial hype wore off.

But ask yourself this. As the Canadian vote to legalise marijuana draws near once more, which direction do you think the best placed marijuana companies’ share prices will head? And that’s not to mention that as many as 10 US states may legalise cannabis this year and next, as well.

And if Canada’s vote passes, what then for the share price of well-placed pot stocks?

Here’s what Sam wrote to subscribers of Revolutionary Tech Investor last week.

In Australia we’re finally starting to see medical marijuana make headway. But, like most trends, we still lag behind countries like the US and Canada, which is where we see real opportunity in the near future.

We classify this ‘pot stock fast fortune’ as a generational event, because it’s only once in a generation you get to invest in opportunities like this.

Of course, no great opportunity comes without challenge. And the explosion of marijuana markets around the world certainly won’t be a painless process for the companies involved. But that’s why our focus for now is squarely on North America. These are the markets with the most buzz and the most potential upside — for now…

And it’s going to be huge business…

According to Deloitte research, Canada will need up to 600 tonnes of marijuana annually. Currently the output of those 56 producers is approximately nine tonnes. In other words, Canada is about to suffer a massive weed supply shortage.

That’s why our two Canadian pot stock recommendations are…’

Oops. I almost said too much.

You can find out all about Sam’s favourite stocks to make the most of ‘phase II of the pot stock boom’, here.

Before moving on….

‘Listed pot stock ranks to fire up’

The above heading comes from today’s Australian Financial Review. The article continues:

Bell Potter Securities is lining up to bring yet another hemp healthcare group to the local exchange – although, this one is having a bet each-way with a leg in the United States market and one firmly in Australia.

Street Talk understands Elixinol, founded by one of the pioneers of the hemp industry, Paul Benhaim, has completed a private fundraising through Bells, with a handful of high net worth individuals and both local and offshore institutions injecting fresh capital into the business.

The next step is an initial public offering within 12 months, with Elixinol tipped to have an enterprise value of $100 million.’

The company’s focus in the US is on dietary supplements involving the hemp plant. Hemp is a close relative to cannabis, but comes with very low levels of THC — the drug that induces pot’s ‘high’. And as the above article notes:

Hemp Business Journal estimates that the total value of the hemp products sector in the US in 2016 was $US688 million. There are expectations that the entire US hemp nutraceuticals will triple its sales in the next three years to beyond $US1 billion.’

Make no mistake. The marijuana story is not old news. And it’s only going to grow as the legalisation wave spreads from the US and Canada, down through South America, across to Europe, and eventually even Asia. (Yep, sorry Duterte…even the Philippines.)

If you want to ride the crest of that wave, have a listen to what Sam has to say here.

The unshakeable Grand Cycle

Now let me ask you a question.

What do an alien invasion, the Third World War and the Second Coming all have in common?

That’s right. They’re all things that could disrupt the Grand Cycle. And in the three years since Phil Anderson introduced me to his Grand Cycle theory, I’ve become more convinced that — failing an event of this magnitude — the Grand Cycle will keep on turning.

Phil’s Grand Cycle theory is, in part, what allows him to make his uncannily accurate forecasts…often years in advance.

If you followed along with last week’s Port Phillip Insider, you’ll know that Phil is on record for calling the Dow Jones’ July 2007 high — almost to the day — three months ahead of time. Then he turned around and forecast the Dow’s March 2009 low 17 months in advance!

Phil has also consistently brushed off the chorus of bearish calls from pundits — including some of us here at Port Phillip Publishing — predicting a market crash this year. And if not this year, certainly next.

A crash is coming, Phil will tell you. But not until the mid-2020s. Until then we need brace for nothing worse than what he calls the ‘mid-cycle slowdown’, due next year.

And as Bloomberg reported on Thursday, Phil’s bullish take is, once again, right on track, ‘America’s Jobs Engine Keeps Defying Forecasts for 2017 Slowdown’:

Payroll gains topped forecasts in five of the past seven months, putting the 2017 average increase of 184,000 almost on par with last year’s 187,000 and above levels typical for the eight-year expansion. Analysts expect barely any falloff from that pace in August figures due Friday, amounting to job growth about double what’s needed to keep the unemployment rate steady in the longer run.

Sustained demand for workers — highlighted by record vacancies — is pushing down unemployment and even attracting Americans who weren’t actively looking for a job.’

The article also includes the following chart.



chart image

Source: Bloomberg
Click to enlarge

The rosy jobs forecast was no surprise to Phil. And there was no need for him to ‘turn upbeat’. He already was.

Phil uses centuries of carefully analysed stock market and real estate data, among other things, to piece together what he expects to happen next. Now, he doesn’t have an actual crystal ball. But his forecasting record is certainly among the best in the business…if not the best.

Phil is happy to share most of his hard-earned knowledge in his entry level service, Cycles, Trends and Forecasts. But he reserves his stock recommendations for his premium service, Time Trader. That’s where he explains the concept of T.I.M.E. trading.

To find out how you can get in on every new stock recommendation Phil makes over the next year, go here.

Cheers,
Bernd