Dear Reader,
Dig into your wallet for cash, and you come up with is a papery cloth blend - 25% linen and 75% cotton for Federal Reserve notes, just, in case you were wondering..
But dig your hands into the ground and pull out the things that actually matter and you come up with wealth: Gold, copper, food, crude oil, and more. And there's increasingly less and less of it, which tells me intense competition will be heating up for the "stuff" in the ground.
And while every other central bank in the West is busy pumping out dollars left and right to cover their massive... linen-cotton blend... debts - dozens of nations are uniting around a common need: Commodities.
At the moment, you need dollars to be a serious player in commodities. Who cares if the dollar is worth more or less? You need 'em to trade commodities. But economies like the BRICs (Brazil, India, China, Russia, South Africa), Iran, Argentina, and more are increasingly focused on circumventing the dollar trade commodities.
Why? Because commodities are the real mediums of exchange in the world. At a time when paper money values are dropping, commodity prices are consolidating. We could soon witness a commodity boom cycle that transfers immense wealth from the West to the East for the first time in 1500 years. And in record time, too.
There's still some time left, but right now is when investors need to be on the hunt for the best commodities and associated stocks. names.
We'll be talking about those today in Midday Momentum. I'll walk you through a few key value metrics to help you find the best commodity stocks to own right now.
This is the most important investment session of the year. So join us at 12:30 for Midday Momentum.
Here's What I'm Watching Today (April 19, 2023)
The Commercial Real Estate Bust: A key term you need to learn is "mark to market." This happens when private investment groups must admit the value of their holdings, like real estate and other alternative investments, are worth less than what they've stated on their balance sheets. Typically, public investments must do this each day to give investors a proper accounting of the real value of their equity. But not so in the long-term investment world of pensions. That is... until people come knocking and cash flow is stressed. This is about to happen to several major pension funds and private investment firms in the near future. If interest rates stay elevated, venture capital firm Tiger Global may need to mark its holdings by nearly one-third, while major pension groups are talking about writing down their real estate assets. This can quickly send shockwaves through the investment world and raise serious questions about liquidity in the system.
Job Cuts: We're nowhere close to done with job cuts in this economy. And the latest source of bleed is Walt Disney Co. (DIS). The entertainment giant is cutting another 7,000 workers from its entertainment division. I'm on my way to Epcot Center on Friday, so I'll be the judge if this is still "the happiest place on Earth."
Green Power Problems: Need an image of your power bills without natural gas or nuclear power in the future? In France, the price of energy will be double the price energy-strapped Germany paid during the winter of 2023. This is the Green Utopia, higher energy costs and little understanding of the science behind alternative energy.
The Chart of the Day
Back to the ground. Get in there, and do it now. Last week, the U.S. Environmental Protection Agency (EPA) changed rules on emissions from vehicles to further reduce incentives for gas-powered vehicles. The new costs for automobiles will likely rise - as the Biden Administration attempts to push more Americans into electric vehicles (EVs). This transition to green energy will be costly, inflationary, and extremely bureaucratic. And - it won't give Americans much of a choice. Why is this happening? Because Americans largely aren't buying up EVs.
A transition to the Green Utopia will struggle, for the reasons I've listed above, but also because of the incredible commodity demand for metals. So, where do you think we need to be putting our money right now?
That's what we'll be talking about all day today. See you in the room.
Stay Liquid,
Garrett
The post Morning Update: Get Your Hands Dirty and Grab Real Wealth appeared first on Midday Momentum.
About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, consultant, and political risk analyst with decades of trading experience and degrees in economics, cybersecurity, and business from Johns Hopkins, Purdue, Indiana University, and Northwestern.