The Ultimate Cheat Sheet for Success in the New America

THE MOST IMPORTANT INDUSTRY

NOBODY TALKS ABOUT
Elon Musk scammed everyone in Silicon Valley. My
congratulations to him. Ill tell you why in a second. But first let
me ask:
Did you upgrade your phone or computer this year?
I didnt.
Do you know why? Because this years versions did not solve any
great problems over last years versions.
Take, as an example, the latest and greatest smartphone. The
Samsung Galaxy Note 4.

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JAMES ALTUCHER SHOW
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MARK CUBAN: ENOUGH SAID

James interviews Mark Cuban, billionaire owner of
the Dallas Mavericks and serial entrepreneur.

Is it such a great improvement over last years Galaxy Note 3? No.

Its the same size. The same processor. Basically the same battery.
Almost the same camera. Very little improvement to justify
spending several hundred dollars.

PETER THIEL: THIS IS WHAT THE FUTURE

LOOKS LIKE
James interviews Peter Thiel, author of the blockbuster new book, Zero to One, founder of PayPal and
the first investor in Facebook.

What about the iPhone 6+? Yes, its a huge improvement over the
iPhone 5. BUT, it has the same processor as the Samsung SIII. The
same processor as a phone that came out two years ago.

You can access these episodes and all James

episodes on Stansberry Radio here.

Theres simply no reason to go crazy over the latest phones. The

old ones have everything we need.
NOW, what if I tell you that the next phone will have a battery that
lasts three months instead of one day?
Then the lines would go around the corner. I would definitely
buy that phone. I would sell my wife for that phone (please do
not forward this newsletter to my wife. You are my CHARTER
subscribers. Youre special to me).
I hate charging my phone. Or trying to figure out if I need to pack a
charger when I travel. Or forgetting my charger in the hotel room.
Someone should solve my problem.
But is this a computer problem? Is it an Internet problem?

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FOR JAMES?
Every day, James answers listener questions in his
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records with his wife Claudia.
You can access Ask Altucher directly here. Or
download episodes from iTunes here.

No, not at all. Its a chemistry problem. The problem

is: How can we extract more battery life from
lithium?

Hes not using it to create better computer solutions

in his cars. Hes using the money to build a BILLION
DOLLAR battery factory.

This problem is going to get solved. This is where

billions in profits are going to be made.

Hes taking advantage of the leftover hype in the

computer technology industry and transferring that
money to solve a very difficult chemistry problem.

Elon Musks battery-powered car company, Tesla, is

a great example...

Right now, hiring chemists is cheap... For 50 years,

graduate students have studied computers.

Because Musks first startup was PayPal, Tesla is a

Silicon Valley-based car company that is roughly
considered a tech company. It had the usual
successful IPO at a high valuation. And very few
people made a lot of money.

Guess what the average salary is for a programmer?

Ill tell you: $91,000.
The average salary for a chemist? $55,000.
Companies that solve hard chemistry problems will
simply make more profits.

Who invested in the IPO? The same mutual funds

that invest in every tech IPO.
What is Musk doing with all the money hes raising?

WHY YOU SHOULD INVEST WITH THE BEST CHEMISTS

The Gutenberg Press largely solved a chemistry
problem...

10,000 years ago, the discovery of agriculture was

largely a study of how chemical compounds interact
with each other to produce stable and storable food.
Suddenly Homo sapiens switched as a species from
nomadic tribes to domesticated cities.

Handwriting ink tended to wash away with water or

degrade over time.
Gutenberg strengthened the ink by making it oil
based and mixing it with various other chemicals
such as carbon, sulphur, copper, and lead.

Wheat domesticated us. Not the other way around.

The past is actually the best predictor of the future.
And if you look at the past three thousand years,
most problems have been chemistry problems.

An amazing thing happened after the Gutenberginvented press started mass-producing books:
Everyone realized they were far-sighted.

Almost every advance in technology and civilization

after that relied heavily on our deeper understanding
of atoms, compounds, molecules, chemistry.

For the first time ever, people realized they didnt

have good enough vision to read a book.

Until the 19th century... when the rise of mechanical

engineering created the Industrial Revolution, and
the rise of the computer created what later became
the Internet Revolution.

This led to the development of the science of lenses.

Everyone needed glasses.
Take it one step further and you have microscopes...
then one step further and you have enormous
advances in the field of chemistry... which led to
great advances in everything from medicine to
electricity (the development of the lightbulb was a
chemistry problem what compounds should be
best used to conduct electricity).

For the past fifty years, most problems have been

computer problems. And while computers and
Internet tech will continue to get better (3D Printing,
Robotics, and more), the big unsolved future
problems (in energy, biotech, space exploration,
and esoteric computer areas like DNA Computing
and Quantum Computing, etc.) will be chemistry
problems.

But of course, it didnt start with the Gutenberg

press...

Everywhere you look, there are chemistry problems

waiting to be solved. But nobodys talking about
them. Right now, theyre not as sexy as Internet
problems.

CNBC to talk about it.

In 2007, I used to go on CNBC every Friday night
and every Monday morning. On one of the Friday
shows they invited me to watch how the show was
produced.

It used to be that, with the Internet, the big question

was how to solve the last mile. In other words, how
to get the Internet to be at high speeds in that last
mile from the cell tower to your home.

Mid-show, the producer walks over to me, were

just trying to fill the space between commercials.

Now that problem has been largely solved (WiMax,

cable modems, etc). The last mile now tends to
refer to how fast can someone order sushi directly
to his home or get a car service to pick him up.
These are content problems and not technology
problems.

Thats how the average investor was getting all of

their financial knowledge. A year later the world
collapsed.

And it shows up in the public companies that are out

there...

Apple and DuPont pay a 1.5% and 2.5% dividend

yield respectively.

Apples year over year earnings growth is 12%.

Googles year over year earnings growth is -5%.

I dont think the above two companies are Buys.

They have had their run over the centuries and
market experts have a fairly good idea how to value
them. Theres a much better way to invest with master chemists who are solving huge problems... and
making money doing it.

Back to chemistry:
DuPonts year over year earnings growth: 51%.

What about the largest companies in the chemical

space?
Dow Chemicals year over year earnings growth to
date: 38%. But apparently this isnt sexy enough for

THIS TECHNOLOGY ACTUALLY WORKS AND IT PAYS DIVIDENDS

One company that IS a buy is Kronos (KRO), a
company that makes titanium dioxide. Youve used
their products probably 100 times today. Titanium
Dioxide can be found in everything from ink to food
to sunscreen to paper and plastics.

higher prices than exist today. There have been zero

sales by top management.
One of the top hedge funds I follow, Millennium
Management, bought 81,000 shares last quarter.
Additionally, two different banks have raised their
earnings estimates on the company.

The company trades for 10 times next years

earnings and has a 5% dividend. Its market cap is
just over a billion dollars, which means its tiny in
stock market terms.

One of my strategies is I always like to invest with

people smarter than me, at lower prices than they
paid. Its almost like I have interns with much more
information than me and they are nice enough to
give me a discount on everything they buy.

Market cap is a term for the size of the company.

For comparison, Home Depots market cap is $145
billion. Apples market cap is $748 billion. Kronos
is tiny in relation. This means it isnt on the radar of
big investors, which is good.

Billion dollar hedge funds and insider corporate

executives usually know more than me about their
companies.

About a year ago, KROs top management made

millions of dollars worth of share purchases at

THE WAITERS PAD

I always carry a waiters notepad to jot down ideas. Making a list of 10

every day is great way to flex your brain muscle. Some of my best ideas
have come from these lists. Every month, Ill share a list with you...

10 WAYS TO GET MORE EXERCISE FROM EVERYDAY LIFE

To come up with great ideas, be creative, and live an abundant life,
you need to be physically healthy and have lots of energy.

unaware of it moment by moment... and then 30 years later we wonder

what happened.

When people say, be physically healthy, my gut reaction is, I

dont want to go to the gym. But I dont have to I just have to be
engaged in active motion every day. This is how humans exercised
for three million years, and it still works.

But there is an exercise that solves the issue: Every hour, stand up with
feet at hip distance apart, inhale, put your hands on your lower back and
look up, then exhale and bend the torso backwards slowly... Then stay
there for one or two breaths (I usually max out at one and a half breaths),
then INHALE to come back up. If you exhale when coming back up
youll get dizzy.

What you do every day (active motion) is more important than what
you do once in a while (hard-core workouts).

I do this exercise because it completely has eliminated back pain for me.

Here are the 10 ideas I wrote down for myself to make sure I remain
physically active, healthy, and energetic...

#6 Whenever youre standing in line, or waiting for a subway or a ride,

or waiting for anything at all, stand onto your tip toes. Balance up there.
This doesnt seem like much, but its a huge balancing act for the whole
body and warms up the calves.

#1 The body is totally stiff in the morning and it can use a good
stretch. Claudia insists that I do one sitting forward bend every day
and I hate it, but I do it anyway because I feel the tension of the
hamstrings release as I breathe into it. There is an easier version,
which is to stand up, bend over and grab your elbows, relax the back
and breathe there, hanging from the waist down. When you come up
you feel like the world is all shiny and new...

Balancing also lights the brain on fire, activates the neurons, and
increases creativity.
#7 Distribute carrying weight efficiently. I see people in Grand Central
Station walking with their right shoulder one foot lower than their left
shoulder... Thats because they are carrying a heaving bag on the right
shoulder and theyve been doing it for years... Amazing how much you
can tell by posture. Dont do that to yourself. Distribute carrying weight
so that both arms have about the same amount of weight. Your body will
thank you.

By the way, this is extremely good for digestion and constipation

issues.
#2 Put a note on your phone (i.e., Google a reminder) that reminds
you to relax your jaw, relax your face, relax your mouth, take a deep
breath and even relax the shoulders.

#8 Volunteer to do the dishes. This gets you standing and moving

instead of sitting. Add laughter to this by listening to a comedian on the
free Pandora app.

Bet you that just reading that made you do it. It is amazing how often
we tense our face and shoulders during the day. That costs you
energy you dont need to spend.

The trick here is: make sure the dishes are spotless. Theres something
very beautiful about the focus required to wash dishes correctly. Its
good exercise for the brain.

#3 Some people use walking machines while writing at their desk.

I am very fond of the idea but havent tried it yet. What I do instead
is take an actual walk in the middle of the day, together with lunch,
because it helps me clear the mind and the negativity that accumulates from stress.

#9 Do a few push ups randomly. Dont even get close to breaking a

sweat. Just do a few easy push-ups.

When Im on the phone I always walk around my house. Some days

(depending on my phone calls) it could be miles of walking.

#10 This may sound like a funny one, but if you have lots of back pain,
it may be because your financial issues are stressing you too much.

#4 I always take the stairs if possible, and we make it a family

game to always park the car as far from our destination as possible
to get more walking out of the day.

There is a guy called Sarno who wrote a book that even Howard Stern
recommended. Sarno says that too much financial stress on our system
blocks blood flow into the tissues that support the structure of the back.
It appears that our back has been hurt, but in reality, we cant handle the
stress.

#5 We spent most of our lives slouching. We are so attached

to computers that our bodies get deformed. We start by curving
the back and then sticking the jaw forward to compensate. We are

If this is happening to you, make a plan for dealing with the stress going
forward. Dont try to bury it... Your back will pay.

10 NEW RULES FOR THE ECONOMY

Every now and then I will share not only my ideas, but the 10 ideas
of others.

fall of prices, and takes advantage of the only true scarcity: human
attention.

Im very privileged to know Kevin Kelly. Hes a co-founder of Wired

magazine. He also helped start an online community, The Well,
which predated the Web and was my first experience with online
communities.

#5 Feed the Web First. As networks entangle all commerce,

a firms primary focus shifts from maximizing the firms value to
maximizing the networks value. Unless the net survives, the firm
perishes.

Kevin came up with the concept that all you need to make a living
(and buy back your freedom) is 1000 true fans. Ill write more on
this later, but you can read about it on his excellent blog, kk.org.
Suffice it to say, anything Kevin says is valuable. And I encourage
everyone to read him.

#6 Let Go at the Top. As innovation accelerates, abandoning the

highly successful in order to escape from its eventual obsolescence
becomes the most difficult and yet most essential task.

A few years ago he wrote his 10 Rules for the New Economy. The
list can also be found on his blog, but I wanted to reprint it here.

#7 From Places to Spaces. As physical proximity (place) is

replaced by multiple interactions with anything, anytime, anywhere
(space), the opportunities for intermediaries, middlemen, and midsize niches expand greatly.

#1 Embrace the Swarm. As power flows away from the center,

the competitive advantage belongs to those who learn how to
embrace decentralized points of control.

#8 No Harmony, All Flux. As turbulence and instability become

the norm in business, the most effective survival stance is a constant
but highly selective disruption that we call innovation.

#2 Increasing Returns. As the number of connections between

people and things add up, the consequences of those connections
multiply out even faster, so that initial successes arent self-limiting,
but self-feeding.

#9 Relationship Tech. As the soft trumps the hard, the most

powerful technologies are those that enhance, amplify, extend,
augment, distill, recall, expand, and develop soft relationships of all
types.

#3 Plentitude, Not Scarcity. As manufacturing techniques

perfect the art of making copies plentiful, value is carried by
abundance, rather than scarcity, inverting traditional business
propositions.

#10 Opportunities Before Efficiencies. As fortunes are made by

training machines to be ever more efficient, there is yet far greater
wealth to be had by unleashing the inefficient discovery and creation
of new opportunities.

#4 Follow the Free. As resource scarcity gives way to abundance,

generosity begets wealth. Following the free rehearses the inevitable

A NEW SOURCE OF DEMAND FOR TITANIUM DIOXIDE

Titanium dioxide consumption has a new source of
demand that will act as a tailwind for producers like
Kronos.

And then, of course, there are the deaths. In 2013,

163 wind turbine accidents resulted in people dying.
Again, not something they like to put on TV.

When people think alternative energy they think

solar power, wind energy, and various other
unproven technologies for fuel efficiency.

How about something that actually works, is energy

efficient, and is ALREADY useful: make cars lighter
so they use less fuel. Thats what fuel efficient
means.

Its amazing to me how often the stock pundits

on CNBC want to tout stocks that are government
subsidized, dont work, and have never been used
successfully.

When a car is lighter it uses less miles per gallon.

Less emissions. Less money spent by consumers.

I honestly dont have any opinion on global

warming. I hate to argue at parties. But many people
have strong opinions. But more importantly, people
simply want to spend less money on their commute.
I like it when strong opinions also line up with the
wallet.

scratch back then.)

Only in the past year or so car companies
discovered that using titanium dioxide to coat the
polycarbonate would improve its scratch resistance.
Increased demand for fuel efficient cars is directly
correlated to demand for titanium dioxide.

Instead of using metal or glass, many cars in the past

few years have started using a lighter thermoplastic
called polycarbonate. Until recently, nobody wanted
polycarbonate because it scratches easily.

Kronos produces 10% of the worlds Titanium

Dioxide. DuPont, which is at 16x next years earnings
and a 2.5% dividend, produces 23% of the worlds
supply. I expect KRO to catch up to DuPont in
valuation metrics, which would imply anywhere
from a 60% to 100% return in the short term.

When I was a little kid, after I watched the movie

Zorro, I scratched a Z into my dads car. (Dad, I
will now confess I did it. Im sorry. Cars were easy to

THE SECRET TO A LONG LIFE

The oldest living person ever was Jeanne Clement, who died in
1997. She was 122 years old.

So what was her secret?

She had a diet rich in olive oil (the Mediterranean diet)

That means just 15 years ago, there was a person alive who actually
met Vincent Van Gogh.

She laughed a lot (see the next section).

S
 he had friends. Friendship turns out to be the single most
important factor in longevity. Always have someone you can
tell your troubles to.

The thing about living long is that it has nothing to do with medicine.
This is basically the entire flaw of medicine. Most drugs cover
symptoms, or even get rid of symptoms, but they dont cure the
underlying causes.

I hate to say it, but keep a low carb diet. I love pasta. I can eat
it breakfast, lunch, and dinner. But every research shows its
probably not good for you. Which kills me. But Id rather it kill
me metaphorically than in real life.

When people asked Jeanne Clement how she lived so long, she
never once gave modern medicine as the answer.

A
 lways be active. Retirement is a myth of the Factory Age
where you get a gold watch after 50 years of service and then
die a year later. Keep active doing things you enjoy and being
around people you love.

For one thing, we know that having good genes is good for longevity.
But genes can be overcome in a variety of ways. Ive spent the past
ten years studying the lives of people who live past 100.
Doctors should be forced to do this study.

L earn how to forgive. The weight of anger will bring you down
to the earth and below.

When were young, we often prepare for a good life. Were ambitious
and hungry and we want to succeed.

What did Jeanne Clement have to say about Vincent Van Gogh,
who would buy canvas at her fathers general store? He was Dirty.
Disagreeable. And badly depressed. Not a good combination if you
want to make friends.

But at a certain point, you want to start preparing for a good death.
This doesnt mean death TOMORROW, it means that your life should
be pleasant enough that death is far, far away. That, to me, is a good
death.

As Warren Buffett said at the Berkshire Hathaway conference that I

attended...

Clement rode her bicycle until she was 100, despite not being very
athletic. She lived on her own until she was 110, when she finally
moved into a nursing home.

If you want people to love you, you have to be loveable.

WHAT IM GOING TO SHARE WITH YOU IN THE NEXT 12 MONTHS

I wish I could say buy Uber because I use Uber
every day and its so comfy to have that car waiting
for me, and they have those little bottles of water,
mmmph, and not have to use cash.

desperately that chemistry set. Wanting to make

things explode. Wanting to watch when combining
two things that would make something new.
In the next 12 months, Ill look at companies in the
rare earth space, aluminum, biotech, energy, etc.,
that I think are about to hit the publics eye and
explode upwards.

But the reality is, I probably use Kronos technologies

more and dont even know it.
This is how I look at companies and industries. Its
important to remember that last years bubble has
never been tomorrows bubble.

Im not forgetting about computers. I come from

that industry. Ive built and sold two software
companies. Im an investor in many others. I even
got thrown out of graduate school for computer
science. Robotics, 3D Printing, the selling of
information products (like this newsletter), online
education, the changes in the staffing world that
result from all of this innovation are all areas I
spend a lot of time looking at.

Its been 150 years since chemical companies have

been fashionable in the publics eye. This is going to
change... Problems in computers, energy, pollution,
medicine, will all rely on chemical solutions.
The original Dow Jones Industrial Average in 1896
was made up mostly of companies that produced
Titanium Dioxide. They got kicked off because the
Wall Street Journal didnt want to write about them.

But this newsletter is not about stocks. Its about the

biggest opportunity of this century...

But when I was a kid, I remember wanting

THE BIGGEST OPPORTUNITY OF THIS CENTURY

Im a big believer that the next century brings
something even more remarkable to the public: The
downfall of corporatism and the rise of The Choose
Yourself Era an era where technology has allowed
us to create our income streams and choose our
freedom with greater opportunities than ever before.

much as possible with interviews with entrepreneurs

and other innovators on how they chose their path to
success. I will discuss many different opportunities
in todays world.
Ive been on the board of a billion revenues staffing
company. Ive seen that industry explode.

The average multi-millionaire has over seven

different sources of income.

How come?
Because companies dont like people.

SEVEN.

They are now constantly afraid of a repeat of

2009 where they had to do mass layoffs

This doesnt mean seven jobs. Thats impossible.

And it doesnt mean start seven companies. Thats
also impossible.

They dont understand all the new rules and

regulations that have been imposed on them.
Theyd rather outsource that to employment
agencies.

Full time jobs are only one source of income. Even

entrepreneurship is one source of income.
Well be looking at many different ways to build
income streams. I will be sending out free letters as

Its scary.

Ive been scared. Ive been broke. Ive been afraid I

would never get a job or an income again.

Building up on these four legs is what I call The

Daily Practice. When I was broke and losing home
and family and scared to death I would never come
back, it was persistent practice in these four areas
that became intricately linked with how I made
money and achieved some success.

This is the new generation of employment and not

the corporatism that we grew up in. That we thought
we were safe in.
And its not a choice of should I be an entrepreneur
or an employee? I dont think entrepreneurs have it
any easier. Theres a high risk of failure.

I didnt want to write a newsletter at first. I give a lot

of things out for free. But this message is important
to me, so I started hiring and researching and
finding new ways to create money and income.

The key is to develop multiple streams of income.

Many of the tools can be found in my latest book,
The Choose Yourself Guide to Wealth, and the
special reports included with this newsletter.

I want to share that with the people who subscribe to

this newsletter. I hope you will join me for this ride
for the long haul.

But to get the mindset of developing those streams

of income Im a strong believer that we need
to choose ourselves to not be afraid of the
gatekeepers that for so long we wanted to have
accept us: a boss, a company, a colleague, an
investor, a client.

I will also be going over more business models in

future newsletters. If you have any questions, feel
free to email me at altucher@gmail.com and Ill
try to answer them here each month or on my Ask
Altucher podcast, where I often pull in experts to
answer questions.

To do this, I want to briefly mention what I call the

1% Rule trying to improve 1% in four different
areas of life every day: physical, emotional, mental,
and spiritual.

Every month, Ill be providing a way to develop your

idea muscle so it turns into a machine. For everyone
who has tried these techniques, the results have
been remarkable, creating opportunities, income,
and abundance.

Physical: Being healthier. Sleeping well. Eating

well. There are many new results out that have
completely changed my conception of what these
three things mean.

Im going to Miami tomorrow. While Im in Miami, if

I go to the beach, Im going to put on suntan lotion.
Every year, I seem to burn more easily. The main
ingredient of almost all suntan lotions? Titanium
Dioxide.

Emotional: Did you know that kids laugh 300

times a day? Adults laugh on average five times
a day. Part of this is the responsibilities we have as
adults. But also, I think we spend now less time with
people we love and trust and who love and trust us. I
always try to improve on this a little bit each day.

-James Altucher

Mental: The idea muscle works like any other

muscle. If its not used, it atrophies quickly. How can
we exercise it? Simply writing down ten ideas a day.
It doesnt have to be business ideas. Or smart ideas.
Or good ideas. Just ideas.

IN NEXT MONTHS NEWSLETTER:

A new, surefire way to make money in hard times
(and how I missed out on a $300 million opportunity
with it), and a new way to live to 100. Plus... how to
get out of all kinds of debt (mortgage, student loan,
healthcare, credit card, and IRS).

Spiritual: This doesnt mean meditate or pray

(although it could). It simply means being grateful
for the life around you. Sometimes, for me, this is
difficult. Which is why every day its a practice.