If there ever was a time when you could see a trend solidly in motion, now is it. 💻 TO TECH, OR NOT TO TECH? Staying with China for another moment… sometimes knowing where not to be is just as important as knowing where to be. After all, all investments are a matter of opportunity costs and probabilities. It’s why we’ve been curiously watching the implosion of Chinese tech stocks. The way we put it in the most recent issue of
🖥️ LONG TECH STOCKS = LONG BONDS Morgan Stanley is echoing our thoughts on the relationship between bonds and tech. To us this highlights how interlinked many markets are and how the general stock market (with its huge weighting in tech/growth stocks) is probably not a great hedge against inflation. From the article: Perhaps you now are beginning to understand why we are “balls to the wall” long commodity based stocks. Not only do we have extremes in tech, but extremes
🛢️ THE STATE OF OIL & GAS While nothing we don’t already know, this Bloomberg piece provides a terrific insight into how pervasive and powerful the ESG hysteria really is (even among the “Big Boys”) and what that means for the energy market: We have relationships with approximately 400 institutional investors and close relationships with 100. Approximately one is willing to give new capital to oil and gas investment. The story is the same for public companies and international exploration. This
While we’re being told coal is having “an existential crisis,” The Wall Street Journal reports: Coal was in decline for years in many countries, but its use is now picking up in the U.S., China and Europe despite growing pressure from governments, investors and environmentalists to curb carbon emissions. The leading reason for the uptick—which has pushed coal prices to multiyear highs—is rising power demand as economies reopen rapidly from pandemic hibernation. Now, the talking heads are too quick to
With government (as well as corporate) debts at nosebleed levels AND interest rates at by far the lowest point in the last 140 years, we’re facing a unique dilemma today… What happens if we were to ratch interest rates up like Volcker did in 1980, when inflation raged? As we discussed in a recent issue of Insider Weekly, there are two ways out of this mess: “One few have considered, but I think that may be a mistake. But first,
This week’s issue is going to be slightly different — an excerpt from a recent issue of Insider Weekly that is guaranteed to ruffle the feathers and trigger a flood of hate mail in our inboxes, so consider yourself warned… We’re going to take a closer look at bitcoin, specifically one of its most ardent disciples, Michael Saylor and his firm MicroStrategy. You may have heard Saylor on any media channel that’ll take him professing his undying love for bitcoin.
We highlighted before the decline in capex by (predominantly Western) oil and gas companies. Take a look at this chart, which shows just how steep this drop is: The irony of the situation is this lack of spending on replacing reserves is paving the way for a repeat of the 1970’s oil crisis. Attitudes towards oil (and fossil fuels) in the West today are eerily similar to attitudes towards the tobacco industry in the late 1990s. No one wanted to
📈 INFLATION: THE CAT IS OUT OF THE BAG Over in the US, the core CPI just hit the highest level in nearly 30 years: Not to mention the fact that food prices are up 40% in some cases over the past year. But don’t fret. The pointy-shoed experts have it all under control (or so they say): As far as markets go, the “irony” of the prevailing belief that any inflation will be temporary is that the weighting to