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Stock Market Wealth

It Takes Balls!

Feb 13, 2018 | Stock Market Wealth

During the month of January, while the stock market was raging-hot, I wrote that our research was pointing to the fact that Ray Dalio, the world’s largest hedge-fund manager and one of the richest men alive, has timed the market wrongly.

Our view was that the GDP numbers, the wage increase for millennials, driven by a shortage of skilled workers (retirees are exiting the job market in droves), the proposed infrastructure plans, and the tax cuts have over-heated the economy and investors will fear inflation and the market will sell-off hard, causing a correction.

Ray Dalio, meanwhile, was on the world stage in Davos, telling everyone to go LONG and to drain their cash holdings. We were stressing the importance of cashing-up, though.

Several top-dog Wall Street fund managers have emailed us in the last few days to complement Wealth Research Group on our macro outlook precision. I wouldn’t be surprised if higher-level officials at Bridgewater Associates, Ray Dalio’s firm, are also reading our newsletter, since Dalio released a lengthy piece yesterday, where he admits that we’re in a much more advanced part of the cycle than he originally thought.

Yesterday, we saw the market rallying again, as we mentioned it would, after investors waited until the market officially entered correction mode to get back into it.

The second that the large indices dropped a total of 10% from the highs, which occurred last Friday, computer algorithms started buying heavily to jack-up the market before the close, and this bullish trading action persisted yesterday.

Wealth Research Group’s focus, as we said, is on which sectors bounce back the fastest because those would lead the market going forward.

What Ray Dalio did, by changing his stance completely in a matter of 10 days, takes balls, especially for a man of his stature and recognition.

I, personally, believe that one of his next big acknowledgements of premature calls would be his bearish position on cryptocurrencies, specifically when it comes to the fact that Bridgewater is still largely underinvested in blockchain technology.

One subject Mr. Dalio and I completely see eye to eye on is that the Federal Reserve is going to screw-up monetary policy during this tightening period, which will usher in the bust.

Across the globe, governments and institutions, for the 1st time since 2011, are worrying about inflation, rather than deflation, and for the 1st time since Trump’s election, they’re concerned with rising borrowing costs.

All of the above are the reasons we diversify into precious metals, real estate rentals, private lending cash flow, and the commodities sector.

These are hedges, specifically in times of higher inflation rates and greater risk of a recession, such as the period we’re entering right now.

But, what stands out above all else, and only if you lived through the NASDAQ bust and the ’08 crash, you can completely appreciate, is the fact that there is NO bailout coming this time – interest rates cannot be cut significantly from here, borrowing standards cannot be lowered meaningfully, and quantitative easing cannot be politically approved once more.

That’s exactly why the blockchain economy will continue to attract hundreds of millions worldwide – it functions outside the realm of fiat currencies and allows us to own our digital assets.

I am jumping on a call with the CEO of the company I see as the one, which I told a good friend of mine was worth condisering making a serious $300,000 investment into.

It took guts for Ray Dalio to repent himself, and it takes even more stamina to enter a market, such as the crypto economy, after it has been decimated by 50% losses in a matter of days, but, like Mr. Dalio points out in his book, money is only made in depressed markets.

Blockchain technology is how mega profits will be made for the 1st time by creating self-sustaining trust within industries and by cutting out centralized-oriented 3rd parties. This is the most profound shift in business since the early days of the Internet.

I will publish our complete research in a matter of hours – it’s time to kick it into over-drive.