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Imagine if you had known the iPhone was coming and what parts were needed to make it.
You’d have made a killing in the stock market! Now, we have that opportunity with the new company of the decade: Tesla.
Paul and I found three pretty cool stocks that manufacture Tesla parts.
If you’re a regular viewer, you know Paul and I believe Tesla is a powerhouse company on track to become a $4,000 stock.
Watch today’s video to see the best ways you can take advantage of the company’s upcoming success. (Spoiler: No one is talking about this Tesla play.)
We also cover:
- Why the housing sector is on track to make a huge difference in the market as millennials and Generation Zers buy in. (0:19 – 4:58)
- How the cannabis industry is moving up from its bottom and is on track to exceed market expectations this year. (10:50 – 15:20)
- An insight into bitcoin as it opens the door to trading options. (15:21 – 19:41)
We are less than 3 weeks into 2020 and already there is so much market news to cover. Tesla is at $500, Bitcoin is rallying, pot is rallying, but we are going to start somewhere else. Let’s start with some of the major trends that are making headlines.
The Housing Market
Housing is a generational trend and right now, it’s a big millennial play. Millennials have dominated the housing market for the past two years.
The housing market is gearing up to become a multi-year trend, carrying over to Gen Z who are going to reach their peak home-buying years in 10 to 15 years. In 2019, more new homes were sold in any year since the real estate crash in 2008. And the numbers are getting higher and higher.
Millennials are moving out of their homes and Gen Z is graduating from college. There is going to be a housing boom.
That’s one of the frameworks of the American industrial economy.
Buying a home is a big commitment. More people are spending on houses and more homes are being built every year for the past several years.
The housing market is one of the big underpinnings of the economic growth we are seeing right now. We recommend iShares U.S. Home Construction (BATS: ITB). It’s a housing ETF with some of the best housing companies in the country.
Millennial Mega Trends
We focus a lot on mega trends — artificial intelligence (AI), Internet of Things (IoT), blockchain, new energy — but by far the biggest mega trend, in the end, is the millennial generation.
Millennials are 93 million strong.
They are adopting new technologies and embracing change.
All of these new cultural and technological shifts are going to intersect and influence one another. Causing what I am calling the fourth industrial revolution.
It is going to remake our country. We’re invested in a lot of these things — Tesla, which we’ve talked about and IoT.
That’s just the tip of the iceberg.
As people put their houses together and then put their lives together, they are going to completely recreate America. That’s the essence of what we are calling America 2.0. It’s really a revolution that’s unfolding.
Millennials are earning more and actually spending more on houses.
Compared to 2018 to 2019, we saw a 7% increase in the value of the home loans taken out by millennials. Higher than the baby boomers and almost as high as Gen X.
Not only are we buying houses, we’re spending more at a faster rate. That’s great. It shows a lot of strength in this economy.
Ignore The Doom and Gloom Media
MarketWatch is filled with doom and gloom, and pessimism. Nonstop. It never ends.
But we are optimistic. We think our stocks are going to rise. America 2.0 stocks are stocks related to the mega trends and related to the rise of the millennial generation.
We are bullish. We are optimistic. I am positive.
I have created my own hashtag for this. It’s #B/O/P. On Twitter that’s been my short form for bullish, optimistic and positive.
For a different point of view that contradicts the bad news media, follow us on Twitter, check out @MampillyGuru and @IanDyerGuru.
Telsa is a perfect example of unfounded pessimism in the market.
We talk about Tesla all the time. That’s the perfect example of where people have been bearish for years, especially in May and June when it was bottoming out.
All over the net, we saw pessimism beyond belief. One analyst, who will remain nameless, said Tesla stock was going to hit $40 per share, which is unbelievable.
That’s essentially bankruptcy. He was calling the bankruptcy of Tesla.
And now here we are at $500 a share seven months later.
Even yesterday, there was talk of a Tesla downgrade. Analysts saying “Don’t get too hyped up about it.”
What can you do?
You can show people where the water is, but you can’t make them drink.
Tesla is at $500.
Our Outlook for Tesla
In the $10 Million Portfolio, we discuss and recommend stocks that are not mainstream. Either their structure is different or they are in foreign markets. You and I have found a pretty cool set of stocks.
We have stumbled on to something special with Tesla.
Just imagine you knew the iPhone was coming and you knew what the parts were needed. What if we knew what’s coming for Tesla, we knew what parts are needed, and we invest in the companies that will supply Tesla in the future? That would be a game changer.
They have a lot of global suppliers. They are turning to countries that are benefitting from the trade war. A lot of business has come out of China because they were being taxed so much on their exports.
As a result, some of the surrounding countries are great places to invest. One of these examples is a company that supplies Tesla. They are looking outside China and it’s looking good for them.
The margin for General Motors and Ford for internal combustion engine cars is 3%-5% max. But Tesla is as much as 25%-30%. If they sell a fraction of the cars of Ford and GM and they are making almost as much profit. It’s crazy.
Now Tesla is actually worth more than Ford and GM combined. Almost $100 billion.
Tesla could be at $1,000 come yearend.
Cannabis Market
MJ is the ETF that has a bunch of pot stocks in it. ETFMG Alternative Harvest ETF (NYSEArca: MJ).
We think it’s going to double this year and it’s gotten off to a good start.
For example, on Tuesday, a company called OrganiGram reported its earnings. The next day the stock was up 45%.
Cannabis stock trades are way up as demands for these companies has increased dramatically.
They fall fast and they don’t go straight back up but you see huge bursts of demand here and there.
We’ve seen that at least three times since late November. It’s looking like it’s gearing up to run big soon. I think these stocks are going to have a huge year. There’s a ton of demand even for these tiny stocks like OrganiGram. Then you have bigger stocks like Canopy that are up.
We’ve seen big moves in companies like Hexo as well. That means there’s a lot of liquidity pushing in there. It’s driven by news that shows there’s massive demand for this product. People have fears there’s too much supply. How crazy is that?
Then you see Illinois open their pot sales and in the first five days, they made $11 million. A bunch of stores actually had to close down because they sold out too quick. The oversupply thing is a myth in my opinion.
Not only that, it was on a crazy cold day in Chicago, which is some serious stuff. It really gets cold. You saw all these people bundled up in freezing weather waiting to get this. How many products and services can you say that about where people are willing to wait in line on a winter day in Chicago to go get?
That just shows you there is an enormous amount of demand for the product that’s out there. I do want to mention that $10 Million Portfolio, which is the same one we are putting the Tesla suppliers into, has some phenomenal pot stocks in it. If you subscribe you get all that.
Get bullish on cannabis.
Nevada, which was one of the earliest adopters of cannabis, is now taking in $11 million per month in taxes. Their sales have to be maybe $100 million per month.
You can bet that North Carolina and the other states where cannabis is still illegal are saying, “You’re taking in $11 million? We want some of that.” It’s going to fast track legalization across the states. I feel like in the next three years, marijuana will be federally legal.
If you wait for that moment, it’s going to be too late.
Bitcoin & Crypto Exchange
A couple days ago, the exchange started to trade options and, boom, liquidity starts to flow into crypto.
It was the CME Group (Chicago Mercantile Exchange & Chicago Board of Trade). The trading volume for their options in Bitcoin were higher than the Baakt options. Baakt has been around for months. CME is one of the biggest exchanges in the world. They are going to draw a big crowd for these Bitcoin options.
We are optimistic on Bitcoin.
Bitcoin, Litecoin, Ethereum, Ripple, Lumen are at the heart of fintech disruptification.
For example, Ripple is working with MoneyGram and other companies that are involved in money transfer.
You can send these tokens across the world in a few seconds and it costs you a fraction of a percent in transaction costs.
Whereas if you did a normal bank transfer across the world, it would not only take days, it would cost you a lot of money in fees.
It just makes more sense all around.
But big banks are not going to disappear overnight.
However, we are seeing the pieces fall into place. Long terms disruption is certain.
Banks are the biggest companies in the world.
There’s an uncalculated market capitalization for all these central banks.
That’s trillions of dollars in market cap that we believe is going to flow into crypto in some way, shape or form. We might not have the exact structure, but we’re trying to look forward and anticipate.
There are no guarantees, but we can start to see this starting to happen.
Regards,
Ian Dyer
Editor, Rebound Profit Trader
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