RE:Lessons From the Movie The MatrixI don't know if my view is red or blue pill, but my sense is that cash is continuing to decrease in value, while resources are reflecting a lot of what's happening in the world with lots of chop at the moment. We have near parabolic moves in some resource areas while others grind sideways. That does make it hard for us in some ways. I'm carrying about 30% cash in my portfolio (that's high for me) but it's a tactical position in case there's a near term opportunity to deploy it such as a volatility event. About 80% of the rest are in some form of resource, and the remaining 20 are in broad market indexes which I believe still have a bit of room to run before they peter out and make way for the commodity bull market. I'm also looking at companies that make money on transactions, not directly on the value of a given asset or resource. I e. companies that make money either way, and long as transactions are happening. I haven't devoted much time to it yet but with population going up, more people getting connected to the internet etc. transactions might be interesting. I still like Suncor, too ;).
Experienced wrote: When I look around what is happening around the world and especially in the United States and periodically watch the US cable networks, it all reminds me of the 1999 movie The Matrix.
Just like the movie, it is very difficult to determine what is reality and what isn't.
It reminds me of the scene where Neo is offered a red pill or a blue pill by Morpheus. It seems to me that most left wing politicians have taken the blue pill.
The problem that I am facing in terms of making investment decisions is that while I believe I have taken a red pill it may not be doing me any good as long as most people are living in the fantasy world provided by their blue pills.
In this fantasy world, traditional signals to determine appropriate action such as the level of government debt, inflation, supply chain issues, productivity, growth in the money supply etc go out the window and are for intents and purposes meaningless. Without these yardsticks it is very difficult to make intelligent decisions.
One can only hope that more people wake up and realize that they need to take a red pill.
One thing that history has proven since the dawn of time is that the longer it takes for sanity to return the greater and stronger the adjustment will be once things get back to reality. How long it takes for this to happen is anybody's guess and for my part I don't have a clue but just in case I have hedged my bets by carrying above average levels of cash in my portfolio.