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Bulls are running but the bears are reloading

Jul 14, 2022

Good morning!

‍The markets are trying desperately to make a push higher in the pre-market as I type. I have no idea if that’ll hold by the time you read this.

I say we do our best to make money anyway!

The markets go up and down which means there’s profit potential either way. In both directions actually.

Here’s my playbook.

These three things could bring a rally

Millions of people are wondering what it’ll take to make a rally stick.

Three things …

First, oil prices have got to come down.

Second, less pain at the grocery store.

Third, the government must spend less.

This isn’t difficult to understand for anybody in the real world so why doesn’t Washington et al get it?

Our leaders are stuck in a negative feedback loop that’s based on getting re-elected. Sadly, they’ve forgotten how to serve the American people.

What to do: Keep it on the fairway. Buy the very best companies you can afford and ignore the rest. Think Apple versus Netflix. Nvidia versus Docusign. You get the idea.

And for crying out loud, hedge!

If you don’t know how, learn. It’s not difficult and I believe anybody can learn to do it with a little effort. (Your 5 Minute Guide to Hedging)

Besides, hedging can help you see “green” on otherwise big down “red” days and, I submit, that’s a good thing!

What to make of Elon’s comments

Tesla CEO Elon Musk made headlines the world over calling his newly opened Texas and Berlin factories “money furnaces.” (Read)

Casual observers are worried because “that can’t possibly be good.”

Actually, it’s great.

Why you should care: There are very few executives operating at Musk’s level. The fact that he’s calling the cash burn for what it is means he is acutely aware of what’s going on. That’s a quality I look for in any CEO at the helm of a company I want to buy.

Shares are up this morning, BTW.

The big “B” ups stake in oil 3rd time in 4 months

I’ve been pounding the table for a year when it comes to oil. And pounding it even harder recently even though prices are pulling back.

Just yesterday, in fact, I said to buy more of my favourite “big energy” producer during a conversation with the fantastic Maria Bartiromo on Fox Business. (Watch).

Shares are still up 44.71% despite the selloff!

Despite what many people want you to think, the reality is that the world will use more oil over the next 20 years. Not less.

Buying now makes tremendous sense, you often hear me say.

Appears I’ve got company.

Billionaire Warren “the big B” Buffett has upped his stake in Occidental Petroleum three times in the past four months. SEC filings reflect a total of 152.7 million shares or roughly 16% ownership worth a cool $8.52 billion.

My choice remains Chevron but that’s moot.

You know what to do.

Pay attention if you own housing stocks

The Rule of the Back Page” never fails. The best stories with the biggest impact on your money are found on the back pages of any given newspaper. Not the front page.

Think about it for a moment.

If something is on the front page, everybody and their monkey’s uncle knows about it. If it’s on the back page, very few do.

Case in point: JPMorgan is cutting mortgage-related jobs citing “cyclical changes” in the housing market. That’s buzzword bingo for stuff’s about to get real.

Apparently 1,000 people are being “redeployed” or simply given their walking papers.

Good for JPM but gonna stink for homebuilder stocks

Insiders are buying a LOT of this stock

Watch out Amazon! Shopify has just released 100+ new features for commerce operators, all of which are aimed to empower the SMB’s that are America’s backbone. (Read)

Most investors think about this as just an e-commerce play but that’s potentially a very costly mistake.

Shopify provides tools that mesh the digital and physical worlds with features that include integrated wholesale selling, customer discovery, and even a unified Shop Cash (basically a rewards system).

Shares are down nearly 79% from a 52-week high of $1762.92.

Insiders are buying. CEO Tobias Lutke made a public announcement that he’s buying a significant stake and not surprisingly institutional buyers are following en masse.

I think it’s worth a nibble.