The Lemon Fool

odysseus2000 wrote:Interesting that most of the comments are negative. This to me feels like a contrarian buy signal, but does innovation trump the Fed?

The more I study the areas that Cathy Wood is focused on the more the potential looks to be more powerful than the Fed.

In terms of genetics this kind of medicine is extraordinarily powerful:

https://www.bbc.co.uk/news/health-63859184

In terms of ai anyone who has played with chatGPT is either focused on the things it gets wrong or are amazed at what it can do now & expect it will get a whole lot better. Having ai write software for me or create graphics I need is extraordinarily useful for me.

The electric car phenomenon is something I have followed for a long time. Tesla is now in value territory, has the best balance sheet of any auto with $20b in cash & exciting products and everyone hates it.

In terms of blockchain, it seems to have stabilised & apart from the spectacular fraud has in general behaved as it should despite the huge sell off.

Meanwhile the Fed do not seem to have crested in interest rates raising & there are mixed signals regarding various observable like inflation, employment etc.

Based on all of this I believe innovation is closer to a bottom than many believe & share prices suggest. At some point innovation becomes a huge buy, but we will only know that point when it has passed.

Regards,

And the counterargument to this contrarian signal argument is that too many people still believe that the leaders from the last cycle will lead us back out of the current slump - historically that doesn't happen.. leadership passes to a different sector and the market takes on a new shape over the next cycle.

vand wrote:

odysseus2000 wrote:Interesting that most of the comments are negative. This to me feels like a contrarian buy signal, but does innovation trump the Fed?

The more I study the areas that Cathy Wood is focused on the more the potential looks to be more powerful than the Fed.

In terms of genetics this kind of medicine is extraordinarily powerful:

https://www.bbc.co.uk/news/health-63859184

In terms of ai anyone who has played with chatGPT is either focused on the things it gets wrong or are amazed at what it can do now & expect it will get a whole lot better. Having ai write software for me or create graphics I need is extraordinarily useful for me.

The electric car phenomenon is something I have followed for a long time. Tesla is now in value territory, has the best balance sheet of any auto with $20b in cash & exciting products and everyone hates it.

In terms of blockchain, it seems to have stabilised & apart from the spectacular fraud has in general behaved as it should despite the huge sell off.

Meanwhile the Fed do not seem to have crested in interest rates raising & there are mixed signals regarding various observable like inflation, employment etc.

Based on all of this I believe innovation is closer to a bottom than many believe & share prices suggest. At some point innovation becomes a huge buy, but we will only know that point when it has passed.

Regards,

And the counterargument to this contrarian signal argument is that too many people still believe that the leaders from the last cycle will lead us back out of the current slump - historically that doesn't happen.. leadership passes to a different sector and the market takes on a new shape over the next cycle.

Yes, that has often been the case, but if the innovation is sufficiently powerful a different outcome may follow.

There is no question that the tech boom of 2000 did not quickly restart after prices crashed, but in the by & by (20 years) the leaders of that era did return.

Since those times the world has changed fundamentally in terms of communication & people’s out look. If you talk to young people they have no interest in the old ways & are instead focused on the new developments in energy, transportation, artificial intelligence, gene medicines etc. Additionally everyone knows the story of 2000 & that may short cut the time to the recovery of these innovative technologies.

It would be depressing if we had to go through another 20 year period, but if so what would the leading stocks be?

The crash in value stocks that went in harmony with the rise in tech has not happened this time & energy is not cheap like it was then, nor were there all the renewable alternatives that we have now which all lead to lower energy costs & geopolitical stability.

I have no idea what will happen, but the world is relentlessly changing & what happened historically may not happen this time.

Regards,

I think a lot depends on interest rates and inflation.

In the most optimistic scenario inflation drops sharply, to 2%, and interest rates are back to near zero, then tech/growth stocks will rebound.

But if interest rates don't fall back to what they were and are kept higher, for longer. Then tech stocks will remain down.

CW (and Baillie Gifford here) has lost a lot of retail investors large sums. Its what happens in a bubble is retail gets sucked into the mania phase. CW still making crazy projections on Bitcoin and Tesla. It's like doubling down on a losing bet.

Not saying tech not value now. But think whole investing environment now changed so innovative companies that make losses aren't going to attract absurd valuations anymore, as so many had fingers burnt in past 12 months, my guess is the rebound will be in those that make real cash profits, like MS and Apple.

odysseus2000 wrote:
There is no question that the tech boom of 2000 did not quickly restart after prices crashed, but in the by & by (20 years) the leaders of that era did return.

Only if you ignore survivor bias and the many leaders that didn't return (or even exist).

What precisely are you meaning by "There is no question ..." ?

dealtn wrote:

odysseus2000 wrote:
There is no question that the tech boom of 2000 did not quickly restart after prices crashed, but in the by & by (20 years) the leaders of that era did return.

Only if you ignore survivor bias and the many leaders that didn't return (or even exist).

What precisely are you meaning by "There is no question ..." ?

I was meaning that the technologies that had promise did mostly eventually bear fruit and that the business that promoted them which had the best funding and were leaders albeit in a big pack of also ran, eventually prospered.

Of course not everyone survived, nor did every technology work, but that is relentlessly true of all business in markets both big and small. Once there were lots of small second hand book shops, but most are gone. There were big players in printing of checks, bills, books and magazines, telephone directory, greeting cards etc, but this printing industry has contracted significantly. The Public House interests of the big breweries are now a shadow of their former selves in many places all over the uk.

The effect of the last 20 years has been to consolidate turnover into the bigger players while at the same time removing small competitors. Small shops that are either charities or have a alcohol license are still about, but many others have vanished. Once there was a street of insurance agents in my home town, not one now. Not all the leading insurance companies survived. Independent, if I remember the name right, went digital early on but still collapsed. Jessops died and was brought back to life, Maplin vanished off the high street, Kodak almost died, now a much smaller business, Marconi became a very much smaller company: Telent, Railtrack was seized by politicians, Woodford equity was wound down, Lehman went bust...

So long as there is capitalist competition one will see strong business survive and weak ones go under.

Regards,

So all the negative comments were yet again a buy signal, with Tesla having gone from a low of $101 around the time of Cathy's "In the know" to the current $180.

It is fascinating how this psychology plays out, time after time.

Heavy pessimism = Buy,

Heavy optimism = Sell.

Yesterday I was told by a poster on another board who previously thought there was no chance of a rally and that this rally was doomed and that I should sell. Today Tesla added another 12%.

All of this can be learned, but many struggle with the concepts and are addicted to group speak as I once was.

Regards,

Tesla has the only decent charging infrastructure

ARK on a tear so far this year. We'll done to anyone brave enough to buy ARK at <$30 a share.

Another super interesting "In the know" with Cathie Wood:

https://youtu.be/8XVVTEu70gk

Regards,

I hated homework. Now children won't have to bother, they can spend their time at home learning things.

CliffEdge wrote:I hated homework. Now children won't have to bother, they can spend their time at home learning things.

It is not just homework. Many jobs will be taken by ai, giving people more opportunities & the politicians headaches in determining how to operate the economy when ai replaces a lot of jobs.

Regards,

Latest in the know with Cathie Wood (45 minutes):

https://youtu.be/jvL2Q0cJLyo

Cathie discusses their take on the latest bank failure & her belief that this will moderate Fed interest rate rises.

Regards,

In her dreams.

odysseus2000 wrote:Latest in the know with Cathie Wood (45 minutes):

https://youtu.be/jvL2Q0cJLyo

Cathie discusses their take on the latest bank failure & her belief that this will moderate Fed interest rate rises.

Regards,

Strangely, Bloomberg were saying that increases in interest rates were also hurting banks because they had to vie for depositors and pay higher savings rates, funny old world.

Latest in the know with Cathy Wood, joined by a mentor with very many interesting points:

https://youtu.be/YT4gJ1Jsl_8

Regards,

New & interesting in the know with Cathy Wood (48 minutes):

https://youtu.be/CvRq_o6wnUU

Regards,

Another interesting "In the Know":

https://youtu.be/MQAVqjVCStc

Regards,

Latest in the know:

https://youtu.be/wbiEGHjlE4Y

Regards,

Cathy seems yet more convinced that deflation, not inflation is the danger:

https://youtu.be/E-kucSaDtag

Regards,

Some what rambling itk this month covering many things, but interesting general information:

https://youtu.be/NWgQpih9yus?si=XmXaeNq5S5c08eKB

Regards,