“Because I used to love her,” the Rolling Stones sang, “but it’s all over now.” The electric vehicle (EV) bull market is officially over, too. The EV bull market — which some would call a bubble, or even a mania — has shuffled off its mortal coil. It is neither resting nor pining for the fjords; it is now an “ex” bull market. We can say this with clarity because Tesla — lord on high of the EV manor from
Read nowOn Friday of last week we said: “There is a formidable bearish case for overvalued technology stocks moving forward, and it is only getting stronger by the day. “The bear case has to do with interest rates at the long end of the curve, and the willingness of the Federal Reserve to sit back as long-end yields (the 10-year and the 30-year) start to rise.” On Monday, Feb. 22, the markets took heed, with various high flyers falling hard. Perhaps
Read nowImagine the world as a ball-shaped scoop of ice cream, sitting upright in an ice cream cone. The polar vortex is a circular flow of low-pressure cold air swirling around the top, or dome, of the ice cream scoop. This low-pressure air flow is held in place by a ring of high-pressure warm air that surrounds it like a doughnut. When the jet stream weakens, the ring of warm air that keeps the cold air in a circle around the
Read now“The only reason to be bearish… is there is no reason to be bearish.” That is the view of Michael Hartnett, Bank of America’s Chief Investment Strategist, as recently expressed in a note to clients. In our view, there are reasons to be bearish. It just depends which assets one is looking at, and the nature of the bear case being applied. Take high-flying technology stocks, for example. There is a formidable bearish case for overvalued technology stocks moving forward,
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 nowAs if the wholly unprecedented nature of political events and market extremes were not enough, we now must also contend with an era of weather extremes. For instance, have you ever heard of a wind-chill warning for North Texas? Probably not, because the U.S. National Weather Service has never issued one — until now. “The cold wind chills could cause frostbite on exposed skin in as little as 30 minutes,” the National Weather Service advised shivering Texans. “Avoid outside activities
Read nowEditor’s Note: TradeSmith offices are closed today to observe Presidents’ Day, but we didn’t want you to go without timely and interesting commentary. Our friends at LikeFolio have stepped up, and we will be back with regular TradeSmith Daily content tomorrow. For now, enjoy! —JCL When Shake Shack reports earnings on Feb. 25, it will be different than you’re used to. Normally, when a company reports earnings, everything about the prior quarter is revealed for the first time. But in
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 nowTesla investors face many risks. One of the largest — and one of the least talked about — is China. Tesla has an extraordinary relationship with the Chinese government. Thanks to this relationship, Tesla enjoys privileges and perks no other American company has received. The question is how long the relationship will last. That question, in turn, is tied to national strategic interest as defined by the Chinese government. If the Chinese government decides it has gotten what it wants
Read nowThe TradeSmith Decoder portfolio hit a new milestone this week. Our highest conviction equity position became a ten-bagger as of the Feb. 9 close, reaching the 1,000% gain mark in less than a year. The wild thing is, this company is just getting started. We wouldn’t be surprised to see it reach thirty- or forty-bagger status in the next few years. Nor is it just the one position. There are other names in the portfolio — all long-term holdings of
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,
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