Contrarian for good reasonOur ex-pat Quebeckers were pounding the tables on precious metal stocks during the early Covid fear mania. They had a number of companies, producers, near-term producers, explorers, royalties etc, that they felt had been unreasonably beaten down to the level of a screaming buy.
They also advanced some oil and natural gas companies during the silly beat-down last year, but our group was sadly lacking in ability to analyze oil and gas companies.
Our tech guy also was heavy on the Nexoptic story.
Our short guy laughs at the notion of Tesla's long term price viability. He believes their market share will be hammered by other car builders including Volvo, which still builds a very good (and safe) car. And now, they're going electric.
A few of us met to discuss where we think things are headed.
Debt bubbles all around us, wide political divisions, aging population etc.
We do not believe the party will continue. BLM and Antifa riots aren't about fascism or racism. We agreed that it comes down to economics and hopelessness. The Feds have already been dropping hints about student debt forgiveness. A trillion nine really is only a drop in the bucket of what has been pumped into the market already with QEs 1/2/3, Operation Twist etc....and now the government that few people supported are going to have to make decisions that nobody else would want.
Those decisions will cause some to rejoice, whilst creditors and those on the other side of the "forgiveness" will be holding a worthless receipt.
Long story short: we expect the markets to continue the honeymoon but only for so long. Bond yields are ridiculous, the Dow is ridiculous...debt is through the roof globally, debt to GDP is at unprecedented levels almost everywhere.
It won't end well.
We are trying to figure out how to best protect ourselves.
So far, we agree on reducing your debt as much as you can. Taking profits in real estate and downsizing if at all possible. Be stocked up on whatever you need for a few years....things that can skyrocket in an inflationary environment with long life such as dental floss, soap, sugar, good clothing, liquor etc. Also, precious metals and perhaps their shares (if you can ensure they don't disappear if your brokerage company goes belly up).
And some select companies that will be instrumental to the changing economy. There are some very good green royalty companies out there like Altius and others....maybe low-cost in situ uranium producers....AI companies like Nexoptic should have a place...."green" metals like nickel and cobalt....you get my drift.
Times are tough and we believe about to get tougher. A falling tide will cause all things to drop, but those that endure will bounce back quicker. So when the tree starts to fall, it best that we liquidate early and wait for the massive downswing to end. Buy when Buffett buys. And when the elites got eliter buying in late 2008, as they did at the bottom of the Great Depression and every downswing before and after.
Resistance to reality and ego has cost many an investor their shirt. Be flexible, open minded and adaptable to changing circumstances.
And always have ready access to cash.
And it doesn't hurt to have a sailboat.
Enjoy your evening y'all.