Hi Fellow Automated Millionaires,

I must admit that I am a huge fan of Warren Buffett. In my humble opinion, he is the Albert Einstein of Investment. But is he an Inventor? Oh yes... He invented his own style of investment with the combination of Philip Fisher and Benjamin Graham that resulted in an annual compounding returns of about 24%. Hence, I decided to emulate his success in Stocks market to Unit Trust Investment by reading lots of his books concerning about him (Warren Buffett doesn't write on his investment style - it is written by other people observing him) and do as . Seeing this, investors will anticipate the revival of the economy and juimp bache have done.

One of the book that really strike me is this book "The New Buffettology" by Mary Buffett (his son ex-wife) & David Clark. Inside the book, they wrote about how Warren Buffett views the market after the bubble burst:

After the bubble bursts, a couple of things can happen. The first is that the country will slip into a recession. You will see reports of layoffs and falling corporate profits. The Fed will actively drop interest rates, which will, in a year or so, respark the economy. The immediate impact of lower interest rates will be an increase in car and house sales. Seeing this, investors will anticipate the revival of the economy and jump back into the market. This time, though, they will be investing in the big names - like GE and Hewlett-Packard- that have earnings.... There's an ugly trick though: If the Fed's dropping of interest rates doesn't revive the economy, the country will slip into a depression and stock prices will really go to hell.

Isn't that what is happening now? The bubble bursts when the subprime crisis emerge. Lots of countries now are into recession. There are already numerous layoffs and falling coporate profits. Lots of countries central banks already drop interest rates. Unlike most instances, interest rates drop didn't respark the economy, if you see all the bad news that is still coming in, it is quite depressing right? More importantly, the stock prices and unit trust prices are really going to hell! Wow... talking about predicting the future. No one else does it better than Warren Buffett.

However, in my humble opinion, I don't think that Warren Buffett is predicting the future. Just like what my Mentor, Mr Anthony Boon has said - "It is a habit" just like when the stock market goes down, gold prices go up and stock market goes up, gold prices go down. Both my mentor and Warren Buffett has been through this cycle so many times. They see a pattern, as long as you too see a pattern, you can make both Bull and Bear market work for you instead of against you.

So coming back to our Automated Millionaire System, how should we make the Bear market work for us? As usual, Lump Sum investment to create an initial portfolio to take advantage of the low prices and Buying Insurance on Investment aka RSP over a period of a year or so to protect ourselves against price volatility. You might think so simple? Well, Warren Buffet doesn't do charting when comes to investment and my Mentor always say Simple is usable and Complicated is interesting.

Happy Investing!

Yours Sincerely,
Max Tay