Why Not Be Ready?

If I close my eyes and think about all the times the world was ending… Just in March 2020, less than four years ago, Wall Street tycoons came on national TV and predicted the end of the world, yet as 2023 draws to a close, any dollar I invested in stocks, real estate, and gold is now at a record high!

Why is it that optimists win?

The reason is simple: optimists make the world work.

Courtesy: Zerohedge.com

This chart shows you the weak character of Wall Street hedge fund managers. They are pessimistic, then cheerful, then depressed again, and then euphoric. They are like a rudderless yacht being swayed by the currents and the random wind rather than a deep-rooted faith in the free enterprise system.

If Bank of America had called me in 2001 and continued until 2023, they’d have heard the same result every time: “I am happy to be alive and have full faith in the future of the greatest economy in the world.

As you can see, no one forecasts growth on Wall Street, and this is despite the overwhelming data about breakthroughs in key industries. What I say is this: let’s make the mental adjustments needed for a shallow recession but be ready for the bigger likelihood of an inflationary boom.

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Courtesy: Zerohedge.com

Is this a slam-dunk trade?

With the highest percentage on record of fund managers expecting lower bond yields, are we about to see a surprise?

I certainly believe so. Once the FED begins to explore its first rate cut in March, they’ll realize that it’s not so clear-cut, and that’s when I expect the first correction for the stock market in 2024.

Inflation is not easy to get rid of, and if you’re also betting on lower bond yields, think about if that’s already reflected in current prices with everything at all-time highs as we speak!

Courtesy: Zerohedge.com

So, let’s talk about the recession and the playbook:

• In 2023, I couldn’t have been more vocal about cash being a trap for those looking for a 5% return when the clear trade was to buy equities!
• In 2024, having more cash on the sidelines makes a whole lot of sense. I just increased my own cash level to 8%.

My biggest trade, though, is called the INDEX BUBBLE.

I believe that we’ve reached a plateau in the concentration of Wall Street in the Magnificent Seven.

Wall Street’s top minds, people like Ken Griffin and Elon Musk, have publicly echoed my belief.

I think the indices will stay somewhat flat in 2024 while picking individual winners will prove to be much more beneficial.

Therefore, I will soon publish my 2024 portfolio.

Companies that rose to stardom in the globalization era face enormous capital expenditures when their entire supply chain methodology is put into question.

Any business that relies on delicate and complex manufacturing processes is set to lose.

Cash is critical in 2024 if a recession occurs, and avoiding the major indices is also smart. Cash is critical in 2024, if recession occurs and avoiding the major indices is also smart.

Best Regards,

Lior Gantz
President, WealthResearchGroup.com