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[Page 1] Harry Browne’s Investment Strategy 1 INVESTMENT STRATEGY IN AN UNCERTAIN WORLD Harry Browne [Page 2] Harry Browne’s Investment Strategy 2 INVESTMENT STRATEGY IN AN UNCERTAIN WORLD © 2008 by Harry Browne. All rights reserved. Printed in the United States of America. No part of this book may be used or reproduced in any manner whatsoever without written permission, except in the case of brief quotations embodied in critical articles or reviews. For information, contact: PLWBrowne@HarryBrowne.org. Web Site: www.HarryBrowne.org [Page 3] Harry Browne’s Investment Strategy 3 Also by Harry Browne How You Can Profit from the Coming Devaluation (1970) How I Found Freedom in an Unfree World (1973, 1998) You Can Profit from a Monetary Crisis (1974) The Complete Guide to Swiss Banks (1976) New Profits from the Monetary Crisis (1978) Inflation-Proofing Your Investments - with Terry Coxon (1981) Investment Rule #1 (1985) Why the Best-Laid Investment Plans Usually Go Wrong (1987) The Economic Time Bomb (1989) Why Government Doesn’t Work (1995, 2003) Fail-Safe Investing (1995, 2003) The Great Libertarian Offer (2000) Liberty A to Z (2004) 2,000+ Libertarian Quotes (2007) [Page 4] Harry Browne’s Investment Strategy 4 CONTENTS Introduction…….…………………………………………………….5 22 Years Before the Keyboard (June 23, 1997)………….…………...7 Investment Rule #1 (July 25, 1984) ………………………………...67 How Little We Know (Aug. 22, 1984) ……………………………..73 Investing in an Uncertain World (Sept. 18, 1984) ..………………..103 InsiderGate (December 3, 1986)……………………………………115 The 10 Golden Rules of Mutual Fund Investing (Feb. 27, 2001)…..123 Forecasting vs. Strategy (March 9, 1980) ………………………….137 Finding & Using the Efficient Stop-Loss (March 9, 1980)…….…...166 The Theory of Contrary Opinion, R.I.P. (Feb. 9, 1984)………….…170 What We Can Learn From the Past (Feb. 9, 1984) …………………178 How to Handle Investment Rules (April 20, 1982)…………………185 Mr. Jones’ Incredible Forecaster (Feb. 13, 1985) …………………..197 Investing by Superstition (March 29, 1987)…………………………211 10 Questions You Shouldn’t Ask About Investments (Feb. 17, ‘95).228 The 16 Golden Rules of Financial Safety (July 23, 1997).………… 237 Understanding Investment Success (Jan. 14, 1987) ……………… 242 About the Author……………………………………………………265 Appendix…………………………………………………….………266 [Page 5] Harry Browne’s Investment Strategy 5 INTRODUCTION March 1, 2008 Harry Browne’s Special Reports opened for business by publishing its first newsletter issue on December 24, 1974. By the end of the 1970s Harry had come to the conclusion that forecasts were pretty useless. He said, "If the world is running out of trees, it is because so many people have used so much paper to write so many words about so many inevitable events that never came to pass." In March 1980, he wrote "Forecasting vs. Strategy," in which he said that profits come from a good strategy, rather than accurate forecasts. As the decades progressed he became progressively more anti-prediction. And he published many full-length articles explaining why it’s impossible to predict human action — no matter how simple it may seem. This book contains 16 of those articles that discuss Harry’s investment strategy. They contain perceptive explanations that debunk so much of what passes for investment wisdom — plus intelligent comments about life. Most of all, the