Markets are near highs, but the news may have you asking: Should I dump my stocks? Yet maybe you should really ask:
Are we just getting started?
Please don’t get this wrong just because almost everyone else does.
All I see on the news is worrisome headlines about the debt ceiling, inflation, and taxes… And that’s on a good day.
On a bad day, the news can be much more fearsome, and the stock market can make just about anyone feel sick.
Recently, there’s been a lot of talk about stocks getting set to crash. There’s a reason for that and the seemingly endless torrent of bad news.
But today, I’ll show you why we should be getting out our wallets rather than fleeing the markets.
Hi, I’m Jason Bodner, editor of Outlier Investor. In my research service, we look for “outlier” stocks that outperform all the rest. And we do that by hunting down high-quality companies that the Big Money is starting to pile into.
But I also use my years of expertise from working on Wall Street to give readers a market perspective they won’t find elsewhere. And I believe that’s especially important as the mainstream media tries to frighten investors out of their positions…
As I’ve shared before, the dirty truth is that good news doesn’t sell.
Bad news jolts your attention – and that’s exactly what advertisers want. Otherwise, you’ll never see their messaging to get you to buy your products.
I once spoke to a news producer for a major network. When it comes to news, she told me they live and die by the advertiser’s dollars. And there are only three ways to guarantee viewership. As she put it: “Nuts, guts, and sluts.”
The lead story will invariably be about some madman’s shocking actions (nuts), a horrible accident or grizzly murder (guts), or a juicy sex scandal (well… you get the idea).
That formula works wonders for the nightly news, and there’s a similar one for the financial media. If you want to quietly ride a wave to wealth and a comfortable retirement, simply don’t watch the programming.
The financial media needs to sell you brokerage platforms, banking products, and the rest of its sponsored messaging. And one of its best tools to do so is scaring viewers.
But all the pundits, experts, and talking heads have something in common right now:
THEY ARE ALL WRONG.
Last week, I shared that I think we’re headed toward the next Roaring ’20s. The last time we saw a situation similar to COVID-19 was the Spanish flu of 1917–1918. We emerged from that into a period of economic and personal wealth growth.
This time will be no different. Right now, we are emerging from a period of lockdown, economic hampering, supply chain disruptions, and pent-up demand. And as such, I believe we’re on the cusp of a similar boom…
As I shared last Saturday, the 1920’s Dow Jones Industrial Average was the equivalent of the Nasdaq today. Just look at the chart below showing the Dow Jones from January 1921 to December 1925 next to the Nasdaq from October 2015 until now. Each period was 60 months… and each period rallied about 115%.
What’s shocking is that the Dow Jones went on to rally another 77% in the following four years.
Will history repeat itself?
I believe so.
So the question is… Where should we invest our money?
Today, I’ll give you two investments you won’t want to miss as we continue into the next Roaring ’20s.
And to find them, let’s first look at the Dow Jones of the 1920s. It was filled with new industrial companies.
Today, we think of industrials as boring, “Steady Eddy” stocks. But back then, they were the engines of growth for a new world and economy. Think of all the companies suddenly producing cars, radios, televisions, and airplanes during that period.
They were the technology growth companies of the time.
Nowadays, we have the Nasdaq Composite Index. It’s loaded with tech-heavy companies and has been the growth engine for stocks for years now. Many wonder how it can continue… but I wonder how it can’t.
For example, almost anything you touch, look at, ride, or use today is packed with tech. Semiconductors, software, and electronic components power pretty much anything you can think of.
And as technology advances, we buy more and more products and use more and more services that rely on these essentials.
These companies are only getting started too. Consider the global semiconductor shortage we are experiencing.
The delivery delays are shocking if we try to buy a dishwasher… a PS5 or an Xbox… or even a computer.
As demand spikes and supply backs up, prices must go up – for both the products and the bottom lines of the companies producing them.
And where do we find companies like these? In the Nasdaq – the modern engine of growth.
That’s why I suggest no portfolio be without an allocation to the Invesco QQQ Trust Series 1 (QQQ), an ETF that tracks the Nasdaq.
And that’s not the only opportunity the new Roaring ’20s will bring…
As technology leads to growth in the next Roaring ’20s, something else is going on under the surface – and some people may even find it scary.
You see, many traditional jobs are vanishing. Manual jobs are being replaced by robots and automation.
Self-driving vehicles are now delivering pizzas. There are now robotic surgeons and automated mortgage brokers. And when was the last time you got a telemarketing call that was a real human?
The truth is, this trend will only continue.
While some people may be anxious about this disruption in the job market, though, the glass is half full. While some jobs will vanish, other jobs are being created.
Programmers are needed to code new artificial intelligence (AI). Tech support people are needed to service robots. And there are countless other applications.
And as investors, we should make sure we don’t miss this trend.
A simple way to gain exposure is to buy the Global X Robotics and Artificial Intelligence ETF (BOTZ). It is loaded with innovative companies in this space – such as Upstart Holdings (UPST)*, Intuitive Surgical (ISRG), NVIDIA (NVDA), and Brooks Automation (BRKS).
This is an easy way to position ourselves in this growing space.
So please don’t get it wrong. Stocks will not crash – they will dash.
And if you want to be where the juice is, I recommend buying the biggest areas of technology and growth in the modern era – the equivalent of the 1920s Dow Jones.
The next few years will be the new Roaring ’20s.
Don’t let the negative newsmongers scare you into missing it.
Talk soon,
Jason Bodner
Editor, Outlier Investor
P.S. If you want to learn more about the specific companies I’m recommending as we head into the next Roaring ’20s, then simply go right here for more details.
*Note: The author holds a long position in UPST.
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The Bleeding Edge is the only free newsletter that delivers daily insights and information from the high-tech world as well as topics and trends relevant to investments.
The Bleeding Edge is the only free newsletter that delivers daily insights and information from the high-tech world as well as topics and trends relevant to investments.
