This is a meatier post than most, but this is a meaty market…
Ivan and I put together a ‘Momentum Monday’ today. It’s a 20 minute tour around the markets.
Today we discussed the momentum in global indexes, specifically Asia (Chinese tech stocks and Japan at 21 year highs), financials and biotech. Hope you enjoy.
I can’t fully explain this bull market, but it won’t stop me from trying. I do know a trend when I see one and strong upward trends are everywhere.
Josh Brown is not shy about trying to explain this boom. He says ‘Just Own the Robots‘. It is a fun read with much truthiness.
We could be in the midst of the first fear-based investment bubble in American history, with the masses buying in not out of avarice, but from a mentality of abject terror. Robots, software and automation, owned by Capital, are notching new victories over Labor at an ever accelerating rate. It’s gone parabolic in recent years – every industry, every region of the country, and all over the world. It’s thrilling to be a part of if you’re an owner of the robots, the software and the automation. If you’re a part of the capital side of that equation.
If you’re on the other side, however – the losing side – it’s a horror movie in slow motion.
The only way out? Invest in your own destruction. In this context, the FANG stocks are not a gimmick or a fad, they’re a f***ing life raft. Market commentators rhetorically ask aloud what multiple should investors pay to own the technology giants. That’s the wrong question when people feel like they’re drowning.
What multiple would you pay to survive? Grab a raft.
Fred Wilson is traveling in Southeast Asia and I founf it interesting to hear his observations as it comes from the eyes of an investor with a great eye at spotting trends:
Throughout our trip in Southeast Asia over the last nine days, I was struck by the palpable feeling of economic growth and entrepreneurship. It felt like a region that is pulling itself out out of poverty by it’s bootstraps.
There is a long way to go for sure. Annual per capita GDP in Vietnam is roughly $7000US, that number is roughly $6000US in Laos, and roughly $4000US in Cambodia.
But there is a vitality everywhere you go. People are on the go. Construction projects abound. Commerce is everywhere. People have phones and motor scooters.
Most of all you see children and young adults. This is a region that lost much of my generation to war and genocide. But they are regenerating their families and societies. In Vietnam, 50% of the population is under 30. In Cambodia, 70% are under 22.
The people are nice. They welcome the tourists and understand the economic support it brings to their cities and country.
So I’m very optimistic about these countries. They are on the move. It was exciting to see that.
This great run in global markets will end, but not this week.
PS – If you have never heard ‘feed mayo to the tuna’ make sure to watch the classic 1982 movie Night Shift on Netflix. Michael Keaton at his best.