2017 was an amazing year for the king of cryptocurrencies. On January 1st, 2017, the price of one unit of BTC was $972 and surged to $20,000 by Q4 of that same year. This move made Bitcoin the most talked-about investment vehicle of our world, and from the hundreds of thousands of words, which I’ve poured into Portfolio Wealth Global’s letters over the past year, you know my cardinal rule – always be a contrarian.
In January of this year, there were many concerns about Bitcoin’s sustainability, which acted as knives, chopping through its price. I even heard my Pilates instructor joking that everyone who got involved is feeling pretty screwed – that was about two weeks ago, and it marked the bottom – $5,900.
People, such as my Pilates instructor, can never make money in the stock market or with any type of investing. They’re hard-wired to avoid criticism and aim to manage the impression they make on others.
I have no desire to be popular. In fact, as an investor, the best thing to do is to be unpopular because it means you’re on to something.
Between 2009-2013, I was screaming from the rooftops that Dividend-Growing stocks that have made investors richer for decades, such as 3M, Stanley Black and Decker, Becton Dickinson, and many others, will not stay cheap for long. I was calling up business associates and close friends to raise money to buy prime commercial real estate in Florida from foreclosures for less than the construction costs right after the crash, but most of them wanted nothing to do with it.
Now, everyone wants to get in on the action of the stock market and to purchase an investment property, while I’m telling them that the unemployment rates are as good as they will get, and that the economy is getting overheated, so the cheapest bargains are in commodities and inflation hedges, but they can’t wait to pull the trigger on expensive tech stocks.
When it all comes to the bottom line, people like to blame capitalism for their failures, but they must take responsibility for the fact that it’s themselves, who are attracted to the safety of owning whatever is hot, instead of whatever is hated.
When the gloom and doom crowd were appearing on every YouTube channel in America forecasting the end of the world, I sold my silver stocks, and in December, 2017 we suggested you take profits from cryptocurrencies. The reason is simple – it’s called sentiment.
Becoming wealthy requires you to invest in poor-sentiment environments, and I’d say that cryptocurrencies have predominantly reached that level now. It’s a good entry point, though they could test the lows again.
Look at the unbelievable amount of planned share buybacks from U.S. corporations planned for 2018. One of the most contrarian calls we’ve made is that stocks will become even more expensive, and the reason is that tax cuts are allowing them to buy their own shares and increase EPS (Earnings Per Share).
In 2019, Portfolio Wealth Global sees companies decreasing share buybacks and beginning to focus on capital expenditures to expand their operations, as the global economy is strengthening. That’s why we see 2018 as the last year of cheap natural resource stocks, before they become the best performing asset class in the world.
But not only that, our analysis is dead-set on the fact that cryptocurrencies are headed higher, while blockchain technology is about to take a sharp turn and enter mainstream business, bringing with it wealth to early shareholders.
We now have an official Everything Bubble. Gold is testing its bull market highs of $1,352, and Bitcoin is again over 5 figures, while the USD keeps weakening.
This country hasn’t suffered from a true inflationary crisis in a long time, but it’s months away from clashing with its worst enemy – reckless spending.