Bonus: Additional perspective. Raoul Pal vs Peter Schiff:
I think Raoul is right: "We actually don't disagree that everyone is getting screwed with 15% per year money printing. But what matters is HOW you're getting screwed and which assets will keep you ahead of the monetary debasement in a way that increases wealth."
I can tell you that with the US economy's fundamentals still solid and big tech's earnings, specifically and the S&P's in general, still expected to be double-digits through the end of 2026 (and 2027, according to Goldman, due to AI's effects on the economy), this sharp sell-off is a glorious opportunity for long-term investors.
As the late great Charlie Munger said, "invert, always invert."
Hyper-growth Amazon is more than 50% undervalued after rallying 5% off the day's lows. It is trading at 12X cash flow while growing cash flows by 30% through 2029 and free cash flow by 646% in Q2.
And suppose you're not comfortable with growth stock valuations. In that case, you can buy extraordinary high-yield aristocrats like ENB or BTI at single-digit multiples, even after impressive rallies in recent weeks.
The principles of smart long-term investing never change
AREN'T YOU GLAD you bought when things looked darkest last friday, and over the weekend? The drop was all about the end of the easy Japan carry trade... very little to do with the US economy. Basically the big Wall St boys got caught with their pants down leveraging /borrowing cheap yen at 1% and buying US assets with max leverage and making both the gains AND extra from paying back in constantly depreciating yen. UNTIL last week, when the BOJ shocked everyone and raised interest rates half a point and the yen SOARED 10% vs the dollar. That triggered currency margin calls which caused traders to sell everything in US markets thats liquid (think crypto, because it trades 24/7 and tech) which in turn triggered losses in US markets and MORE margin calls for these power players.
The VIX volatility index soared from 10 to 60 Sunday night , the highest since the covid lockdown fear, and then started to come down. (It's almost all the way back to "normal" now...)
THAT'S HOW CHANGA KNEW TO START BUYING ZE BOTTOM. Like I posted, BUY FEAR in this market. WE ARE JUST BEGINNING TO ADD MORE COWBELL/easy money. Liquidity is everything, and we are about to turn the gusher on with the US Fed lowering interest rates in Sept, probably faster than expected before. The futures are betting on a 50 bp drop in September now vs a quarter point. It's also an election year which is classically bullish as no Fed Chairman wants to backstab the POTUS who hired him ("It's the economy stupid" -Clinton:)
So DON'T BE A LEMMING. Lemmings all got vaxxed and lemmings all bailed or were too scared shitless to buy the bottom which is fast getting away from you.
IF YOU DONT REALIZE THIS, DROP EVERYTHING AND WATCH THIS
These guys are all ex wall street and know their stuff.
They make a great case that crypto was liquidated as it was the only 24hr traded asset over the weekend available to sell to make Yen margin calls, and it will be the leader back out.
I think fbtc (bitcoin) and bitw are WELL WORTH CONSIDERING here, along with JEPQ
If you want to know one of the more conservative ways Changa is taking advantage of this gift of a market dip while generating 9% income on top of potential capital gains, take a look at JEPQ. I bought a little more earlier today.
But my real advice is to ignore the short term and key your eyes downfield. Bitcoin is a volatile asset, with big ups and big downs. Always has been, and will continue to be for a while. Times like these reinforce that market timing is a fool's errand.
Bringing a trading desk mentality to crypto misses the point. You are investing in a once-in-a-lifetime change in how money works around the world. Resist the urge to look at intraday prices, and focus instead on where bitcoin could be next year, in five years, and in ten years.
When you get your first job on Wall Street, they teach you that the four most expensive words in finance are “this time it’s different.”
Does anyone control the economy? The government regulators say they do, and most Americans believe that.
So the economy and the stock market are both too big to fail. "Too big to fail" means that GoverFed props them both up with printed/borrowed money.
But beware. This means that GoverFed will let the economy fall into recession, or even depression, and the stock market crash, when it suits the purposes of GoverFed
This is not a time for an emotional response. There are clear macro drivers behind the retracement that are temporary. Waiting a few weeks for the Fed to catch up with the rest of the world on interest rates is a blip. A recession on the other hand is a midterm phenomenon. If it happens, and it almost certainly will, then what would you prefer to peg your wealth to, fiat & derivatives or crypto? Buy when the market panics; I am averaging in a 30% increase in my BTC position.
Worst case, well I don’t want to think about a worst case. She can’t win. Can she?
Bonus: Additional perspective. Raoul Pal vs Peter Schiff:
I think Raoul is right: "We actually don't disagree that everyone is getting screwed with 15% per year money printing. But what matters is HOW you're getting screwed and which assets will keep you ahead of the monetary debasement in a way that increases wealth."
https://youtu.be/Nzo6DMuZkOo?si=WtpZqXL_zvt2fzIK
Yes! You can learn to FLY
https://youtu.be/_YkhQCXtbBA?si=qQRURINQs8qwNclf
I can tell you that with the US economy's fundamentals still solid and big tech's earnings, specifically and the S&P's in general, still expected to be double-digits through the end of 2026 (and 2027, according to Goldman, due to AI's effects on the economy), this sharp sell-off is a glorious opportunity for long-term investors.
As the late great Charlie Munger said, "invert, always invert."
Hyper-growth Amazon is more than 50% undervalued after rallying 5% off the day's lows. It is trading at 12X cash flow while growing cash flows by 30% through 2029 and free cash flow by 646% in Q2.
And suppose you're not comfortable with growth stock valuations. In that case, you can buy extraordinary high-yield aristocrats like ENB or BTI at single-digit multiples, even after impressive rallies in recent weeks.
The principles of smart long-term investing never change
Buy Fear, Sell extreme Greed. Repeat
(Now is still big fear:)
https://seekingalpha.com/article/4710634-why-the-stock-market-just-had-its-worst-day-in-2-years
AREN'T YOU GLAD you bought when things looked darkest last friday, and over the weekend? The drop was all about the end of the easy Japan carry trade... very little to do with the US economy. Basically the big Wall St boys got caught with their pants down leveraging /borrowing cheap yen at 1% and buying US assets with max leverage and making both the gains AND extra from paying back in constantly depreciating yen. UNTIL last week, when the BOJ shocked everyone and raised interest rates half a point and the yen SOARED 10% vs the dollar. That triggered currency margin calls which caused traders to sell everything in US markets thats liquid (think crypto, because it trades 24/7 and tech) which in turn triggered losses in US markets and MORE margin calls for these power players.
The VIX volatility index soared from 10 to 60 Sunday night , the highest since the covid lockdown fear, and then started to come down. (It's almost all the way back to "normal" now...)
THAT'S HOW CHANGA KNEW TO START BUYING ZE BOTTOM. Like I posted, BUY FEAR in this market. WE ARE JUST BEGINNING TO ADD MORE COWBELL/easy money. Liquidity is everything, and we are about to turn the gusher on with the US Fed lowering interest rates in Sept, probably faster than expected before. The futures are betting on a 50 bp drop in September now vs a quarter point. It's also an election year which is classically bullish as no Fed Chairman wants to backstab the POTUS who hired him ("It's the economy stupid" -Clinton:)
So DON'T BE A LEMMING. Lemmings all got vaxxed and lemmings all bailed or were too scared shitless to buy the bottom which is fast getting away from you.
Bonus: Some of you might like the middle ground of fund (etf) ticker JEPQ. 10% dividend plus potential capital appreciation from here. Still a great entry point. Take a look https://seekingalpha.com/symbol/JEPQ?source=section%3Asearch_bar%7Ccontent_type%3Aall%7Csection_asset%3Asearch-basic%7Csearch_item%3Ajepq%7Crow_num%3A1%7CURL_first_level%3Aarticle%7Ctopic%3Asymbol
THIS IS A GIFT FROM THE MARKET
IF YOU DONT REALIZE THIS, DROP EVERYTHING AND WATCH THIS
These guys are all ex wall street and know their stuff.
They make a great case that crypto was liquidated as it was the only 24hr traded asset over the weekend available to sell to make Yen margin calls, and it will be the leader back out.
I think fbtc (bitcoin) and bitw are WELL WORTH CONSIDERING here, along with JEPQ
*not financial advice. Always DYOR
https://www.youtube.com/live/NsFavh7uS1U?si=GKk6MKOLPYMVzJ97
If you want to know one of the more conservative ways Changa is taking advantage of this gift of a market dip while generating 9% income on top of potential capital gains, take a look at JEPQ. I bought a little more earlier today.
https://seekingalpha.com/article/4703400?gt=d1dfbb30a62aaaba
*Nothing here is financial advice
RAOUL PAL ON THE CURRENT MARKET NASTINESS.
Worth a Listen!
https://youtu.be/tCs1DGYWIxo?si=ncZa1M5YZt0BsxyB
But my real advice is to ignore the short term and key your eyes downfield. Bitcoin is a volatile asset, with big ups and big downs. Always has been, and will continue to be for a while. Times like these reinforce that market timing is a fool's errand.
Bringing a trading desk mentality to crypto misses the point. You are investing in a once-in-a-lifetime change in how money works around the world. Resist the urge to look at intraday prices, and focus instead on where bitcoin could be next year, in five years, and in ten years.
When you get your first job on Wall Street, they teach you that the four most expensive words in finance are “this time it’s different.”
https://experts.bitwiseinvestments.com/cio-memos/the-crypto-market-sell-off-what-happened-and-where-we-go-from-here
Perspective. CNBC Will Bitcoin reach its 1 Million Milestone in 2025?
What would you be doing right now if so?
https://www.cnbc.com/advertorial/2024/05/15/forecasting-bitcoins-future-price-expectations-for-2025.html?mvt=i&mvn=156ad025504d4bed8c64de92723d7ef6&mvp=NA-CNBC-11239420&mvl=CNBC%20ROS_Polar%20-%20Polar%20Engine%20Backfill
Recreational FPV done flyers find the coolest locations
Enjoy
https://youtu.be/CnGk-xjv5vg?si=Qn0X0jnTbgpPukC7
Does anyone control the economy? The government regulators say they do, and most Americans believe that.
So the economy and the stock market are both too big to fail. "Too big to fail" means that GoverFed props them both up with printed/borrowed money.
But beware. This means that GoverFed will let the economy fall into recession, or even depression, and the stock market crash, when it suits the purposes of GoverFed
Invest in toilet paper and water so that you can resell it when there is a Grid shut down!
No one will ever admit there is a bubble, even after it implodes...just human nature.
This is not a time for an emotional response. There are clear macro drivers behind the retracement that are temporary. Waiting a few weeks for the Fed to catch up with the rest of the world on interest rates is a blip. A recession on the other hand is a midterm phenomenon. If it happens, and it almost certainly will, then what would you prefer to peg your wealth to, fiat & derivatives or crypto? Buy when the market panics; I am averaging in a 30% increase in my BTC position.
Worst case, well I don’t want to think about a worst case. She can’t win. Can she?