NEW PODCAST WITH CHRIS MACINTOSH
Chris joined Patrick Ceresna and Harris “Kuppy” Kupperman for an anniversary episode of The Market Huddle to discuss the macro landscape right now and how to navigate it as an investor.
Here’s a smattering of the topics they touched on:
- Chris’ investing playbook for the next 3 years
- How close are we to World War 3 (plus, how the Fed could alter the course of an increasingly likely global conflict)?
- What Greta Thunberg and greenies fail to understand about coal
- Beware of rising rates — what sectors and industries to stay away from in a rising interest rate environment (and which pockets of the economy are hot right now)
- Why investing books are (largely) a waste of time (and what to read instead to become a better investor)
- Shipping stocks as a protection against geopolitical risk
- Why offshore oil and gas investments today are like Cuba right before Castro’s revolution. To long-time readers it might seem like we’re flogging a dead horse here with pounding the table on offshore oil and gas, but we believe there’s still massive upside to be had in these dirt-cheap opportunities.
- A trading lesson from a midget olympic sprinter (a politically incorrect take on what it takes to make a killing in the markets)
- And much more…
You can listen to the entire conversation on YouTube here.
A BREAKOUT IN GOLD?
We couldn’t help but notice gold’s trading range (in dollar terms), marked by a very significant resistance level at around $2,000.
We have seen this price action plenty of times before to know that when resistance levels are broken, markets tend to make up for lost time very quickly.
When you price it in euros, gold has already pushed through that resistance. And you would notice the same trend if measured in emerging market currencies.
Now, what does this mean for gold stocks? When you look at the long-term price action of gold mining stocks relative to the S&P 500, a very clear and pleasant picture emerges. See for yourself:
Right now, gold mining stocks are about as out of favour as they were at the height of the Dot-Com bubble — right before they went up some 20x. Meanwhile, the trading range over the last 10 years is compressing and appears close to breaking to the upside.
We are tempted to predict that within a year or so gold mining stocks (relative to the S&P 500) will begin a grand bull market repeating the performance from 2000 to 2011.
ALL THINGS TRANSITORY…
Feels like a lifetime ago, when — back in February 2020 — we started warning that lockdowns will bring about inflation and shortages. Fast forward to today, and this pesky stuff is now part of our daily lives. We recently set up a dedicated inflation channel in our Insider private forum, where members can share their own experiences with all things “transitory”.
We shared a few egregious examples of shrinkflation in these missives in the past, but this one from Member Stefan might just take the cake.
Inflation is really out of control now
7 Monster Munch in a bag – 7!
And member Leanne shared this next one, and it’s so bizarre it almost deserves a spot in the humour section.
The fact that someone thought wearing this glittery outfit to make that speech was a good idea is truly baffling.
ARGENTINA: NOT JUST THE STEAKS AND MALBEC
Let’s also touch on Argentina.
We’re now just days away from a presidential runoff vote between a leftist and an anarcho-capitalist libertarian that looks as if he’s from an era where you could drink whisky during the day and get away with it.
Now, we don’t have a crystal ball, but regardless of the election outcome, we see Argentina as a fascinating asymmetric opportunity in today’s macro environment.
One consequence of the persistent mismanagement of the economy by the Peronists in power is that Argentina’s credit market today is practically non-existent.
With the benchmark rate at 133% (last time we checked), you would have to be insane to take out loans and mortgages. As such, the majority of the economy (real estate, businesses, etc.) is cash-based.
Now, why does this matter?
If — like us — you’re of the opinion that we’re at the end of a multi-decade debt supercycle (and we’re heading into a prolonged period of rising interest rates globally), Argentina could fare much better than many indebted (Western) economies.
And lastly, some inflationary humour, courtesy of Insider member Mike:
Enjoy the rest of the week!