I love speculation.
Americans believe they have stopped speculating in the stock market. They handed it off to Vanguard and Blackrock. This dude manages $800 billion of your money.
Basically the markets have Warren Buffett, Blackrock and Vanguard buying stocks and George Soros selling them.
Somehow all four always win…
Back to speculation though…the sport of winners (even though we generally lose).
In the last week alone 218 stocks rose 10 percent or more (thanks Fly).
These numbers will not reverse the accelerating trend into robo and indexing, but I can feel the speculative fever brewing in my feeds.
My speculation dollars have obviously been in technology (mostly software) and I do think we are in the early stages of the next technology boom.
Why?
First – Jeff Bezos (may he live as long as 122 year old Warren Buffett), loves quoting Warren Buffett as he hyperloops past him in wealth. The master has taught the student who now teaches the master …
Don’t believe me? Read this great post from Tren Griffin on the dozen things he learned from Jeff Bezos.
Second – It feels like we are moving directly from the mobile, social, SaaS, big data and biotech boom to the Augmented Reality, Virtual Reality, Machine Learning, Fintech boom.
As hard as the networked/cloud world has been to value, the next boom just adds a new layer of complexity to valuations.
While dollar cost averaging into the $SPY is still the best strategy for 90-99 percent of people’s savings earmarked for stocks, I am excited about the opportunities for the active investor in this new world.
Third and maybe most important – 145 year old Warren Buffett loves technology stocks. I mean the 167 year old guy is selling Walmart to buy more Apple. The only thing left for the 189 year old Warren Buffett to buy is Cisco because gosh darn selling picks and shovels to the video and communication crazed world is going to be bigger than Coke and Gilette razors (millennials don’t shave).
Here is the chart that is haunting Warren Buffett as he stands over the toilet to pee at 4 am with nothing coming out but dust:
Google is coming for Geico and their ludicrous marketing budget will be Google’s margin.
The banks – or as I like to call them ‘Men Who Can’t Code‘ that have been protected by regulation will eventually be eaten by software and the fact that millennials hate debt and credit cards.
Warren is slow and old but not stupid.
He’s buying tech dips. He’s licking his chops for tech plunges.
I could be wrong.