In 2020, arguably the single best asset to own in size was Bitcoin. For the coming year, that could easily hold true once again, with BTC having a reasonable shot at it before the year is out. Apart from Bitcoin — which is practically its own asset class — one of the assets we are most bullish on is the U.S. dollar as a currency, relative to all other fiat currencies. The U.S. dollar looks set to romp and stomp
Read nowOur view of inflation is complicated, but not too complicated. In TradeSmith Decoder, we have large-sized bullish U.S. dollar forex positions as of this writing, and short precious metals positions, because the near-term mantra is “growth first, inflation later.” These positions are doing quite well. A little bit of history may help clarify our stance. While the 1970s were a spectacular decade for gold, the middle-going was quite rough. In an interim period spanning most of 1974 to 1976, the
Read nowThursday (March 4) was a pleasantly bullish day with plenty of green on the tape — if you were long energy stocks, that is. The crude oil price shot higher, with West Texas Intermediate in the $64 range, after a surprise decision from the Saudis to maintain their million-barrel-per-day production cut. This was excellent news for oil and gas-related names, which were already at 52-week highs. For most of the market, however, Thursday was a sea of red. For overinflated
Read now“The stone age did not end because the world ran out of stones, and the oil age will not end because we run out of oil.” The Economist attributed that pithy statement to Don Huberts, the head of Shell Hydrogen, in 1999. According to New York Times columnist Tom Friedman, it was first said by Sheikh Ahmed Zaki Yamani, Saudi Arabia’s Minister of Oil and Mineral Resources from 1962 to 1986, as far back as the 1970s. Either way, this
Read nowAmerica looks poised to come from behind, muster its formidable might, and win hands down — just as it has done before, time and time again, in various contests throughout the twentieth century. But this time it isn’t about a World War, a space race, or an arms race; it’s about the vaccine rollout. America winning the vaccine race likely means a faster U.S. economic recovery; an ability to delay inflationary consequences of aggressive fiscal stimulus (because vaccine-powered growth comes
Read nowInflation hawks need to relax, and perhaps even chill out a bit: The Magic 8-Ball forecast for when inflation roars back is still “Reply Hazy, Try Again.” That was the implied message of Jay Powell, the Chairman of the Federal Reserve, in a not-so-subtle pushback this week against rising fears that inflation will quickly become an economic problem. In no small measure, that is our message, too. As we have previously laid out in these pages, we certainly believe inflation
Read nowThe Reddit rebellion appears to be over, or otherwise headed toward a quiet end. The GameStop squeeze is winding down — the share price of GME has stayed below $100 for days — and the Reddit silver squeeze appears to be winding down, too. In many ways, the GameStop saga was not what it seemed (for reasons we’ll examine shortly). But it was, certainly, one of the wildest market events of the past 100 years. To find a comparable drama,
Read nowInvestors, on the whole, seem convinced that inflation will stay low; that interest rates can’t rise very much; and that passive investing is here to stay. All three of those beliefs could be wrong, and the second two statements hinge on the first one. If inflation comes back in a meaningful way, interest rates could rise again. And both of those developments were structural — meaning inflation persists for a decade or more, and interest rates rise for that period
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