The Banking System as you Know it is Dead

Predicting the future is a tough gig.

Nostradamus is probably the most well known predictor of futures. He had some serious lead up time. He made his first set of predictions in Quatrains in 1555.

Fair play to the man, he got a few things right.

Nostradamus called the Death of Henry II in 1559. He was accurate too. He said,

‘The young lion will overcome the older one,

On the field of combat in a single battle;

He will pierce his eyes through a golden cage,

Two wounds made one, then he dies a cruel death.’

How did Henry die?

A jousting lance through the visor. Part of it even splintered off through his eye. He was carrying…a shield with a lion on it. And he suffered for 10 days before dying.

Score: Nostradamus 1 – the World 0.

Another one he was spot on with was, Hitler.

‘From the depths of the West of Europe,

A young child will be born of poor people,

He who by his tongue will seduce a great troop;

His fame will increase towards the realm of the East.’

And he also added,

‘Beasts ferocious with hunger will cross the rivers,

The greater part of the battlefield will be against Hister.

Into a cage of iron will the great one be drawn,

When the child of Germany observes nothing.’

I probably don’t need to go into much more detail there.

Score: Nostradamus 2 – The World 0.

I’ll leave it Nostradamus there (because I do have a point to all this). The key takeaway here is that he got a lot of things right. He’s possibly the most famous foreseer of the future that there is.

Predicting the future is an incredibly difficult job. That’s why not many others in history have really been that good. But I reckon I know another one.

I’m going to go out on a limb and say one of our Port Phillip Publishing Editors, Vern Gowdie, is up there with Nostradamus.

Vern might kill me for saying this. But I can’t think of too many others (Nostradamus aside) that have predicted the future with startling accuracy.

Granted I’m also pretty good — and I’ll show you why shortly — but you can have more than one good visionary…

In August 2015 Vern published a book, The End of Australia: The Real Story Behind Australia’s Coming Economic Collapse, and What You Can Do to Survive It.

With eerie accuracy Vern predicted the 2015 stock market correction. But that wasn’t it. He also predicted the fall in the Aussie dollar, the collapse in bank shares and the return of falling interest rates.

Nostradamus step aside, Vern Gowdie is in the house.

Score: Nostradamus 0 – Gowdie 1.

Vision of the future good and bad

He describes a ‘Long Bust’ in his book. Over the last five months you’ve been watching it all take place in front of your very eyes. Everything you’re seeing now in the markets, Vern called last year.

If you’d bothered to get Vern’s book last year then you’re well placed for what’s coming in the months and years ahead. But if you haven’t read Vern’s book – you’d better get onto it quick smart.

I’ll be the first to admit, sometimes the view of Vern and I clash. I’m highly positive about the gains up for grabs if you can pick and invest in the right stocks in the market. Vern takes a more pessimistic view. And after reading his book, it certainly made me think twice about things.

Last year I said it’s possibly the most important book you would read in 2015. I might sound like a broken record, but this could be the most important book you read in 2016 too.

Of course, I find it always important to take as much information in as you can when deciding on your financial moves. I do believe that Vern is on the money with his predictions.

But I’m not too shabby either. My view on things takes a slightly different approach. Overall I think Vern just might be right that the Aussie economy is in for a long bust. But I also think that, no matter what the market conditions, there will always be companies that outperform and return big gains.

For example, last year the All Ordinaries returned -0.46%. That’s rubbish. If you invested in the ASX 200, then you’d be looking at -7.3%. If you were investing in mainly ‘blue chip’ stocks and index funds, then you probably finished 2015 in the red.

I recommended 10 stocks in 2015 in Australian Small Cap Investigator. The average return of stocks held was 40.7%. (You can read more about that here.)

But these returns aren’t proof of my ability to predict the future. This is:

The banking system as you know it is dead

In March 2014 I wrote about the future of banking. In May last year I wrote about the future of the banking system. The essence of the articles was that a banking revolution is coming. The way you ‘bank’ today is set for massive upheaval. Kiss cash and coins goodbye. Kiss the branch and the teller goodbye.

These antiquated bank systems are set to change. In their place are mobile payments, robots, automated systems and cognitive computing. New technology is shaking up banking. And the big incumbents aren’t ready for it. That means they’ll get left behind.

Apple Pay for instance is starting to get real traction with people. Bloomberg reports,

‘Where some 12 million people use it at least once a month, a number that should more than double, to 25 million, by yearend, according to Piper Jaffray analyst Gene Munster.

‘The [Apple Pay] service generated just $15 million in gross revenue for Apple in the first year of operation, according to Richard Crone, chief executive officer of Crone Consulting, a firm that specializes in mobile payments. Crone figures that could top $1 billion annually in five years if ad revenue is factored in.’

Where are the banks in all of this? Napping at the wheel. They’re only just now starting to realise mobile wallets are something they need to provide. But it might already be too late.

The rise of Apple Pay, Android Pay, AliPay and other digital wallet payment systems is the first clear evidence banks are in trouble.

You heard it here first.

Regards,

Sam


Sam Volkering is an Editor for Money Morning and is small-cap, cryptocurrency and technology expert.

He’s not interested in boring blue chip stocks. He’s after explosive investments; companies whose shares trade for cents on the dollar, cryptocurrencies that can deliver life-changing returns. He looks for the ‘edge of the bell curve’ opportunities that are often shunned by those in the financial services industry.

If you’d like to learn about the specific investments Sam is recommending in either small-cap stocks or cryptocurrencies, take a 30-day trial of his small-cap investment advisory Australian Small-Cap Investigator here, or a 30-day trial of his industry leading cryptocurrency service, Sam Volkering’s Secret Crypto Network here.

But that’s not where Sam’s talents end. Sam specialises in finding new, cutting edge tech and translating that research into how the future will look — and where the opportunities lie. It’s his job to trawl the world to find, analyse, research and recommend investments in the world’s most revolutionary companies.

He recommends the best ones he finds in his premium investment service, Revolutionary Tech Investor. Sam goes to the lengths of the globe and works 24/7 to get these opportunities to you before the mainstream catches on. Click here to take a 30-day no-obligation trial of Revolutionary Tech Investor today.

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