Hello everyone.

Well, he’s finally done it! Musk now owns Twitter and has already set about the cleansing process by firing the CEO and other top executives. Apparently, he also has the intention of cleaning up the content of Twitter. Musk has updated his Twitter description to “Chief Twit.”

Musk tells us the reason he bought Twitter is because it is “important to the future of civilization to have a common digital town square, where a wide range of beliefs can be debated in a healthy manner, without resorting to violence.  He went on to say in his tweet that “there is currently great danger that social media will splinter into the far right-wing and far left-wing echo chambers that generate more hate and divide our society.”

Musk added that he did not buy Twitter “to make more money. I did it to try to help humanity, whom I love.”

Musk says that Twitter must be “warm and welcoming to all….”

 

In reporting season, Amazon disappoints.

Third quarter results were reported today, and they missed analysts’ estimates.   The forecast is for a disappointing fourth quarter too.  The macroeconomic headwinds - inflation, high interest rates, etc, - have resulted in a slowdown in Amazon’s core retail business as consumers returned to shopping in stores.   This does not bode well for the holiday shopping season coming up.  According to Adobe, online sales are expected to grow just 2.5%.

But Apple was solid and remains a stock to own.  Revenue rose 8% year-over-year to $90.1 billion, exceeding expectations of $88.9 billion and marking a September quarter record.  Earnings of $1.29 per share came in ahead of the consensus $1.27. 

 

Could there be a turnaround in Treasury Bonds in 2023?

Two and half centuries of market history tell us that this is a possibility.  

Bonds have been crushed this year.  2022 has been part of a two-year losing streak which hasn’t happened since 1958-59.  The bond ETF, the $24 billion iShares 20+ Year Treasury Bond (TLT) fund is down more than 34% year to date and about 38% from where it started in 2021.  By comparison, the S&P 500 is down just 18%, which is considerably better than the bond market returns.

John has stopped sending bear put spread trade alerts on the TLT.  He thinks the rich uncle has paid his dues.  Clients/subscribers have made a small fortune trading the TLT in the last couple of years just by following John’s trade alerts.

Bank of America explains that the last time Treasuries fell more than 5% and were negative the following year happened in 1861.  And interestingly, the last time government bonds posted negative returns for three straight years?  Never.

As Bank of America points out 250 years of history is something we should all heed.  Keep your eye on bonds in 2023 and wait for those trade alerts from John.

 

Nancy Pelosi’s husband assaulted

The assailant broke into their San Francisco home early Friday morning reportedly looked for the speaker – Nancy Pelosi.  Paul Pelosi was taken to hospital and is expected to make a full recovery.    Police arrested David Depape and he will be charged with attempted homicide, assault with a deadly weapon, elder abuse and burglary.

For my Australian readers, what do you miss about Australia when you go overseas for a holiday or for work?

For those readers, who are not from Australia, I ask you the same question.  What do you miss most about your own country when you travel away from home?

Have a great weekend.

Cheers,

Jacque

 

Believe you can and you’re halfway there.

Theodore Roosevelt

Hello everyone,

A very good day to you all

First, let’s welcome our new members:

Martha Ellis
Kumar Dant
Elizabeth Anthony
Kayode Olagnuju
Wf Mide
Casey Riggs

I hope I haven’t missed anybody out.

This post will summarize John’s bi-weekly webinar, which was done yesterday.

John called the webinar:  Whiplash Market (and hasn’t it been just that)

In 2022 YTD John is up 75.88%.

His trailing one-year return is 78.54%

His average annualized return is 44.23%

John says the Bottom is in. (We will bounce around in ranges from here on until the bull market takes off).

• Midterm election noise is about to depart from the news
• We are 9 months into a 12–18-month bear market
• Oil prices continue to fall
• Inflation is plunging – may not show up until later in the year
• Bear market in bonds may be ending with the 10-year rates topping 4.00%
• VIX pops to $35

The global economy is recessionary.

PPI – comes in hot at 0.4% in September.

Non-Farm Payrolls falls short 263,000 in September

JP Morgan sees recession in 6-9 months’ time according to CEO Jamie Diamond.

Supply chain problems are disappearing as two years of port congestion ease.

Unemployment rate 3.5% = 2022 low. 

IT’S TIME TO INVEST

Capitulation is near
Sweet spot for LEAPs setting up. (Only get this opportunity 2 to 3 times in a decade) GRAB IT!!!
Look for a strong 2^nd half-scenario to continue

Junk Bonds might find a place on John’s list soon.

HYG = 8.2% yield to date

U.S.$ will start to top out around here.  Maybe one last dash to the top before exhaustion.  Then you can buy the Euro, the Aussie, and the Pound as the U.S.$ falls.  (Please don’t do this in the forex market unless you know what you are doing)

LEAP candidates are numerous.

Look at Netflix

ROM

NVDA

TSLA

BRKB

But don’t expect these to go up in a straight line.  Put the expiry in 2025. 

Bull markets start 6-9 months before a recessionary environment ends.

John also mentioned Snowflake as a stock to put on your list.

U.K. Prime Minister, Liz Truss, is out.  She has resigned.  She lasted 45 days – the shortest tenure of a Prime Minister ever.  So, Britain is on the hunt for its next leader.  There is a lot to fix in this county.

Does anyone remember Yes, Minister, the TV series about the minister and how he was controlled by his aides

about what he said and didn’t say,
about what he knew and didn’t know,
about what he could do and not do,
and which areas he should dabble in and not dabble in.

It seems that Liz did not have enough quality aides with the necessary knowledge to direct her properly. And was Liz listening well?  It seems there were failures all round.

Rental stress is still a thing in Australia.  It is now cheaper to buy a house than rent.  People with mortgages are passing on the extra cost to their tenants.  The great shift is still going on.  People are moving to the regional areas to secure cheaper housing.  Small-town neighbourhoods – once thought of as no-go zones are being gentrified.  Businesses are moving in and changing the whole environment.  House prices are starting to come down. 

Wishing you all a wonderful weekend.

Take care.

Cheers,
Jacque

Life’s most persistent and urgent question is, "What are you doing for others?"

  -- Martin Luther King, Jr.

 

Hello everyone,

Trust your weekend was relaxing or productive or whatever you wanted it to be.

John titles his Monday newsletter: Blunder 3.0

In other words, when the Fed keeps interest rates too low for too long, then raises them too much too quickly, it then lowers them again too much, which whipsaws, or creates a bi-polar mentality in the market, and then ignites all thrusters in the rocket and takes the market on a merry swing into the stratosphere.

Welcome to the roller coaster…

This one will be with us until at least the mid-terms have been done and dusted and the next CPI figure is released.    There’s going to be a lot of talking, but in the end, it will all be about the numbers.   You have a choice:  you can turn off all social media and the TV and give yourself some peace and stillness for a time or you can continue to digest and ruminate about what’s said and not said in the media.   There is a lot of misinformation, to be sure, you just need to be aware of it.

John’s Monday newsletter is focused on reminding you that you are buying now for what is going to happen 6-9 months down the road.  So, on the big down days, we will have and have had in days past, remember to buy in small parcels.  Close your eyes and pull the trigger, click that key, or get your offspring to do it for you.  They have no fear built in yet.

John has been very nimble this year.  As a result, he has returned a great one-year return of +78.54%.

Are you worried about the decline of Tesla lately?  You shouldn’t be.  It’s approaching a price-earnings multiple of 30X, as John points out in Monday’s letter.  What soured the sentiment toward Tesla?  You guessed it – Musk’s close relationship with Twitter.  Musk sold a large amount of Tesla stock to fund his Twitter buy-in.  The market sliced $333 billion or 34.6%, off the market capitalization of the company.  Has Musk taken multi-tasking to the extreme and dabbled in too many ventures?  Taking your eye off the ball at critical times can be a person’s or a company’s undoing.  Time will tell if his step into the Twitter space is Musk’s undoing or is Twitter’s constructive renewal.

If you’re still not convinced.   John’s wise wisdom here should pacify you.  He reminds us that Tesla is the fastest-growing large company in the world.  Profit margins are increasing, thanks to the recent collapse of commodity prices.  Unit sales will rise by 40% this year.  Every time Tesla opens a new factory at a cost of $7 billion, it generates $15 billion of profit per year, forever.  

Has anyone ever been to the Middle East?  When John was working for Morgan Stanley in the 1980s, he volunteered for a job that involved him flying to Kuwait and riding in a camel caravan – a great social event - with the Kuwaiti Royal Family into the Dibdibah Desert. The chiefs in Morgan Stanley had received the invitation – notoriously difficult to get on this list.  MS needed someone who knew the Middle East well, could speak some Arabic, was comfortable in the desert, and was a good rider.  It was a risky assignment as the U.S. had just launched air strikes against Libya, destroying the dictator, Muammar Gaddafi’s royal palace, in response to the bombing of a disco in West Berlin frequented by U.S. soldiers.  John was the only one who put his hand up.

If you wish to read about all of John’s adventure in the Middle East, let me know.

Most pandemic consumer trends are now starting to wear off.  The stationary bike, the new sofa to watch your favourite Netflix series, or truckloads of potting mix to get your herbs and veggies growing are all on the out.  One sector, however, is still running strong:  pet care.

Hands up who rushed off to the Animal Welfare League and picked up a fluffy bundle to keep your company in the wee hours?  Pet ownership is booming in the U.S.  Morgan Stanley research has found that there are about 5 million more pets in the U.S. than there were in 2019.   That 4% increase in pet ownership has resulted in an 11% gain in pet spending.  Pet ownership has become a global phenomenon.  The English have a long-standing history of pet ownership – especially dogs.  They are brought in handbags to the dinner table in restaurants and on trains.  I’ve also seen them at cafes, the hairdresser, and at the gym.  In Australia, our pets ride in the back of utes, ride the waves with their master and harass the postman.  Cats, naturally aloof, are also popular and merit a mention.  Animals have a calming effect on the human body, and it has been scientifically proven that they can lower stress levels and moderate blood pressure.  A four-legged friend is definitely worth the effort and ultimately will be considered part of the family.

Have a great week.

Cheers,
Jacque

Don’t judge each day by the harvest you reap but by the seeds that you plant.

    -- Robert Louis Stevenson

Hello everyone,

I hope life is treating you well wherever you are in the world.

The market is still in a slugfest.  Rallies are punctured by the bears now.  It’s a waiting game until we find a market bottom.  The market will see it before you do.

Have you thrown your hands in the air and gone to cash?  This is what many people have done, according to a UBS strategist.  Some $89 billion has poured into money market funds in the past week.  People are trying to time the markets.  Most can’t do it.  Most people don’t get back into the market until the train has well and truly left the station.  Will your cash work for you sitting in the bank?  Long-term opportunities can be found in the environment, technology, and food.  Always monitor and record John’s suggestions.

Janet Yellen says the U.S. economy is doing well.  It has slowed down, but jobs reports still indicate a quite sturdy labour market.

On Thursday, the inflation report is released.  Let’s wait and see what it says.  Volatility will probably surround this report.

It’s the 20^th anniversary of the Bali bombings on October 12.  A very sad day for so many.  All I know is that violence begets more violence, so let’s all do our bit to keep peace in the world.

The forecast for Australia from the weather bureau is bleak.  Rain, cyclones, and extreme weather events are expected between October 2022 and April 2023.  I guess that means no BBQs on the beach this Christmas Day???

The IMF is also forecasting a bleak outlook for economic growth for Australia.  Cost of living, mortgage rates, job cuts in companies will all put pressure on economic activity.  Many people are now looking at alternative ways to build a home – tires, bales of hay, and shipping containers all now feature as cheaper options for a home. 

That’s your lot for today.

Do take care.

Happy trading.

Cheers,
Jacque

The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.

  -- William Arthur Ward

 

 

Hello everyone,

First, let’s welcome Sabelo Mthembu and Mia Lily to the group.

This post will be a summary of John’s most recent webinar – on October 5th.

Titled:  Betting the Ranch

John is up +70.18% YTD in 2022

He is up 9.72% in September.

An annualized return of 45.36% for 14 years.

80.09% trailing one-year return.

He has made 9.12% in 9 trading days.

I would argue that you could count on one hand people that can do this consistently over many years.

We are now 9 months into a 12–15-month bear market.

Q4 could be the best entry point for stocks in a decade.  It will be the time to look at those LEAPS.

Concierge clients will soon have a dedicated website for all their LEAPS.

Inflation is plunging but it may not show up until the October 13 number.

VIX pops to $34.00

The major trading rally launched with the onset of Q4 may be discounting the end of interest rates in as early as two months.

U.S.$ is close to peaking with bond bottoming at a 4.00% yield.

Tesla's deal to buy Twitter is a disaster for Musk – there are a lot of non-believers that the deal will even take place.

The Fed raises rates by .75 basis points – the statement suggested rates will be higher for longer.

Consumer sentiment hits a record low according to the University of Michigan.  It is worse than the pandemic low and the 2009 Great Recession.

The VIX hits $34.00 on Tuesday.  Perfect time for John to put out trade alerts.

The bond short is gone.  The rich uncle has given everything away.

The risks of NOT being invested are rising.

Stocks for your list:

PANW – great LEAP candidate

ROM – great entry point.

VISA – great entry point

BRKB – great LEAP

As are many others…

TLT has lost 43% in 21/2 years. 

Real estate is in freefall.  Case Shiller – falls 18.7% to 16.1% in June.

That’s all for now.

Do take care.

Cheers,
Jacque