Category: Investing

While the bitcoin bots are still holding onto their investment waiting for it to go to $100,000, I am in search of the next best thing. A lot of hatred is thrown my way when I criticize bitcoin. This is despite the fact that I called the top to the very day and I made sizable fortune shorting bitcoin here. This is not to say you can not get rich investing in cryptocurrencies. You most certainly can. However, when every fool in the world is telling you how to get rich investing in a particular sector, you can be sure you are in the mania phase and the only money left to be made is on the short side. I knew the top was in when a bunch of co-workers were all talking about bitcoin around the proverbial water cooler. Additionally, people I have not spoken to in years called me to ask if they should buy bitcoin. I sent them a link to my post here. I recommended they read the book “Extraordinary Popular delusions and the Madness of Crowds” before investing in bitcoin. One person I know bought at the very top. He took a loan out on his house to buy bitcoin. He did not take my advise. Very few do. He made up his mind and just wanted confirmation and approval from me before he bought at the top. When he disagreed with me, he told me I did not know what I was talking about. He listed all the reasons bitcoin would continue to go up. I suggested he write a few reasons why it might go down. The next thing I heard was the ring tone.
So what is the next best thing? I believe there is an incredible opportunity in the mining sector. Below are a few charts to give you a feel for how cheap this sector has become.

These ratios are approaching levels not seen since the 1960’s. The only better time to buy was in 2001. If you bought in the 1960’s and/or in 2001, you were sitting on spectacular returns of over 500% within 8-10 years.
I believe we are close to a bottom. I think in the next 8-10 years there will be 500% gains on some of these mining shares. Your co-workers will gather around the water cooler to talk about how easy it is to get rich. They will tell you, “just buy mining shares”.  All of these ratios, shown above, will be at the other extreme. That will be the time to sell.

Certain commodities are approaching their 2008 low. That was when everyone thought the world was going to end. This is not to say they will not stay low or go lower. However, these particular commodities have caught my eye.

I tend to buy natural gas as it approaches 2.50. We have made several trades this year with natural gas.

If you are a big believer in the idea that the affluent tend to drink coffee, than this looks like a sure bet. As the third world lifts itself from poverty, they will look to be drinking coffee.

Like coffee, sugar has the same story. Affluent nations tend to increase their per capita consumption of sugar.

I have detailed the case to buy and hold platinum many times. South Africa is the next Zimbabwe.

The over reaction to soybeans due to the suppose “trade war” is amazing. Soybeans are due for a bounce.

Buying corn at 3.00 is a steal. In the future, I will be going long as it approaches this level.

This is how state governments get you broken down by region.

The income tax is the most destructive and evil tax. The southern states of the US seem to give some relief to the individual.

The real estate market in Las Vegas has been in a bull market since 2011.

I consider the median home sale price to median household income the best measure for what is happening with the real estate market in a given area. I outlined what I consider good buy zones and sell zones. Below is the Las Vegas market.

Between three and four(ish) is about right. Not overpaying but not getting a good deal.
Las Vegas unemployment is pretty much at the low end.

Break down of employment is below.

Not surprisingly, most of the jobs are in leisure and hospitality. Las Vegas real estate is very vulnerable to economic recessions like the one that happened in 2008. During a recession, the first thing people cut are trips to Vegas. Responsible people do that anyway.
There is good news. Rents are going up. Home ownership is down. The population continues to increase. With interest rates so low, you can still price rent at least 400$ above mortgage, insurance and taxes.
This is not the time to go on a buying spree, but being very selective you could get good rental properties and nice cash flow.

Ronald Wayne co-founded Apple with Steve Wozniak and Steve Jobs. He sold his 10% share back to Steve Wozniak and Steve Jobs for $800 in 1976. That 10% share today would be worth $93.1 billion, making him one of the richest man on earth. Read the full story here.
How can you not live the rest of your life filled with regret?

The commitment of trader report shows the position of managed money in the futures market. Data is collected on Tuesday and published on Friday. Why they wait three days before publishing the data is a mystery, considering we live in a digital age where it could be posted immediately.

The “dumb” money is bearish on gold.
Gold, believe it or not, is actually seasonal. It performs better in certain months. We are in the seasonally bullish months.

I believe a sizable bounce is coming in the price of gold. I went long here.

Took some profits on SCHA. Position has been closed. I believe a small correction is coming and there will be better buying opportunities later in the summer.

The technical significance of 6000 for bitcoin can not be stressed enough. A daily close below this level will lead to another waterfall decline. Volume tends to pick up when it approaches the 6000 level, indicating buyers are showing up. However, the bears are in firm control of this market.

I also found it interesting that on a day when everything was seeing red, bitcoin went up marginally.

I will update the performance tab at the market opening price and correct accordingly.