Restaurant Industry Trends are a Microcosm of Accelerated Creative Destruction
Oct 15, 2020 | Investing Strategies
In a book written in 1942 titled Capitalism, Socialism and Democracy, the Austrian-born economist Joseph Schumpeter coined the term “creative destruction” and called it “the essential fact about capitalism.” Creative destruction “revolutionizes the economic structure from within,” Schumpeter wrote, “incessantly destroying the old one, incessantly creating a new one.” The creative destruction process is all too often painful. Entire industries…
Financial Conditions are Tight, and Markets Are Vulnerable
Sep 30, 2020 | Investing Strategies
Financial conditions are tighter right now than they’ve been in years. That might sound surprising. After all, the Federal Reserve, and the U.S. government, have taken unprecedented measures in 2020. The Federal Reserve has expanded its balance sheet by trillions, made a promise to support the corporate bond market, and said interest rates will stay near zero until 2023. The…
Why Corporate Treasury Departments Will Come to Embrace Bitcoin
Sep 29, 2020 | Investing Strategies
MicroStrategy, a Nasdaq-listed company with a roughly $1.5 billion market cap, is the first publicly traded entity to embrace Bitcoin as a corporate treasury asset. But it won’t be the last. As of Sept. 15, 2020, MicroStrategy (MSTR) revealed it had purchased 38,250 Bitcoins at an aggregate price of $425 million, including fees and expenses. MicroStrategy had originally purchased $250…
2020 Election Q&A and the Benefits of ““Go Anywhere” ” in a Macro-Dominant World
Sep 25, 2020 | Investing Strategies
We’ve received some interesting questions about the election, and about TradeSmith Decoder as a service. We’ll answer a few of those today. As a quick note regarding questions, the mailbag is always open: You can reach us via [email protected] We always enjoy hearing from readers — and if your question is a common one, we may answer it directly in…
Why the FANG Stocks Will Start Trading Like Commodities or Currencies, for Years to Come
Sep 18, 2020 | Investing Strategies
Imagine a child’s favorite food is birthday cake. He loves it so much that his fondest wish is to eat birthday cake for every single meal. Then, in some Twilight Zone version of reality, his wish is granted. He gets nothing but birthday cake, for every single meal. Morning, noon, and night. At first this would be great. The kid…
In Conditions Like These, You Don’t Need Fear to See a Big Market Decline
Sep 17, 2020 | Investing Strategies
We recently explained why stocks could retest the March lows before the year is out. This made some readers upset. Some of the feedback we received was along the lines of, “There is no way we could revisit the fear of the March lows.” The idea of replicating the fear conditions that existed in March seems impossible. To which we…
Stocks Could Retest the March Lows — Here’s Why
Sep 14, 2020 | Investing Strategies
Believe it or not, there is a plausible scenario where the stock market sees a retest of the March lows before 2020 ends. It isn’t a far-fetched scenario, either. Though not the base case, another 30% or greater drop in the S&P 500 — and the Nasdaq — could happen before the year is out. If that sounds bizarre, well,…
Dear America, We’ve Had Our Fill of Dollar Assets. Sincerely, The World
Aug 31, 2020 | Investing Strategies
Something interesting and exciting — and profoundly bullish for precious metals and Bitcoin — happened on Thursday and Friday of last week. To explain what happened, and why it’s a big bullish deal, we need to walk through the chain of events. On Thursday, Aug. 27, Federal Reserve Chairman Jerome Powell gave a historic speech from Jackson Hole, Wyoming, live-streamed…
The 60-40 Portfolio is On Its Last Legs
Jul 31, 2020 | Investing Strategies
The 60-40 portfolio has been a cornerstone of retirement strategy for decades. Around the United States and the world, hundreds of millions of retirees have had, or still have currently, some version of a 60-40 portfolio. For American retirees, though, a serious problem looms. The 60-40 portfolio is on its last legs. It is simply going to stop working as…
Why Silver is Taking Off Like a Rocket Ship — and Should Keep Going
Jul 24, 2020 | Investing Strategies
In TradeSmith Decoder, we nailed the 2020 silver move thus far. And it looks like there is much more to come. We took a super-sized position in a bellwether silver ETF on March 23, two days after the low. Then we added a second leg (again substantially sized) on July 9, noting the upside move could accelerate. In addition to…
