#124 - 2021 Predictions Review: Will $AMZN Dominate eCommerce in 2022? Curated.com - the Marketplace to Shop With Experts, Reddit IPO and When to Join a Startup.
In this week's episode of Reformed Millennials, Broc and Joel review their 2021 predictions and give some insight into what they think 2022 has in store. Also, Joel talks about what his Q1 predictions are for the economy and the Omnicron virus.
This is the last episode for the year but were excited for our listeners to check it out.
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👉 For specific investment questions or advice contact Joel @ Gold Investment Management.
2022: Quick teaser for the 2022 week 1 episode!
Omnicron runs wild and almost everyone North America gets it by mid to late February. However, come late March it fizzles out and the death rate plummets in countries/regions with high vaccination rates. The boosters make a huge difference and by the summer of 2022 it's boom times again.
Of course, the media hypes Omnicron because they can’t get clicks without the Trump in the white house.
$PFE makes more money than they can spend and to hide from Liz Warren, they try their best to hide it by buying something huge like Moderna. The SPY/TSX is up more than 25% in the year. FAANG rips. Healthcare rips. Re-open stocks rip. But the staples lag the rest of the market as Oil hits the all elusive $100.
Investors Are Scared! This is BULLISH
Take a look at where we are sentiment wise compared to where we've been at this time over the prior 2 years. We have about half the bulls and almost twice the amount of bears.
I think at this point, we want to be looking at the areas that are diverging positively. With breadth so weak, as everyone likes to remind you every day, where is breadth actually improving?
Small-cap Healthcare is one area for sure. Here is the $PSCH ETF overlaid with Biotech. With Large-cap Healthcare making new all-time highs last week, is it time for the smalls and biotech to participate?
Remember these peaked in Q1 along with the Nasdaq Advance-Decline line, Nasdaq new highs list and so on....
So did the ARKK funds. Check this chart out from All star Charts:
If these were the leaders to the downside this year, and the first areas to peak, what does that say about the market if they stopped going down?
Looks to me like the Santa Rally is late but still en route… Only time will tell.
💸Reformed Millennials - Post of The Week
It feels like the world of investing is full of mania’s right now and many seem to have topped out.
Charlie Bilello has a great read on ‘The Other Side Of Mania’s‘.
In the midst of a mania, it can seem as if the “voting machine” is all that will ever matter, and you can safely throw caution to the wind. But the “weighing machine” is always lurking in the background. Eventually, a security’s underlying value matters, you just don’t know when…
Read the attached for more on:
OUR PERSONAL FAVORITE: SPACS
Build Back Better News: “Ho Ho No from Joe”
It’s over. Sen. Joe Manchin’s refusal to support the Build Back Better plan dooms it in the Senate and means the bill won’t become law. There will be attempts to resurrect it - Sen. Schumer already announced the Democrats are pushing ahead in January - but the final version is likely to be substantially trimmed down.
This outcome isn’t exactly shocking.
A poll last month showed 74% of West Virginia voters oppose the Build Back Better Act. This might seem surprising for a state where 32% of residents’ personal income came from government checks. But West Virginia is a coal country and this was a very non-coal-friendly bill.
Unlike President Biden’s fast dropping popularity, Sen. Manchin has a 60% approval rating in one of the reddest U.S. states. That he should oppose the bill so heavily out of favor in his home state is hardly surprising.
Bad for Tesla, good for taxes
Dooming the bill also doomed the planned tax hikes. Funding the bill was controversial from the start. While the original tax levies (raising the top income-tax rate to nearly 40%, while boosting capital gains rates to 25%) were abandoned, others remained.
A minimum tax rate of 15% was planned on corporations whose annual income averaged above $1 billion in the last three years, affecting some 200 companies. More controversially, an excise tax of 1% would have been imposed on stock buybacks by public companies.
On the whole, those are both good for stocks. Not all of them, however.
Anything with a hint of green was taking it on the chin Monday morning. The signature legislative package contained roughly half a trillion dollars of support for various forms of cleantech, the biggest federal commitment to the energy transition by far.
The economy will be alright …
Goldman Sachs was quick to cut back its outlook for US growth. But the changes were marginal. “While BBB in its current form looks unlikely, there is still a good chance that Congress enacts a much smaller set of fiscal proposals dealing with manufacturing incentives and supply-chain issues,” said the economists.
Oh, and lest we forget: The Build Back Better Act included a massive $79 billion IRS appropriation to strengthen its enforcement activities. Looks like the hiring of new auditors won’t happen, after all.
🌊 Companies To Peruse 🌊
Curated.com - the Marketplace to Shop With Experts
Patreon CPO says the company will double in size in 2022 - looking to go from 400 > 1000 employees this year $4b val
Redditt goes public and files to go public - raised money at $10b in august and is now looking for $15 - currently has 50m daily active users
🔮Best Links of The Week🔮
Ben Evans Presentation - The most exciting themes in technology today are transformative visions for 2025 or 2030
Aswath Damedoran on the future of university and education
Omicron, and China's Changing Calculus - Peter Zeihan
Omicron is taking a chunk out of expected global growth. Bloomberg reported that the entire global economy is only expanding at a 0.7% rate, which is half the world’s growth rate from last quarter. Before the pandemic, the global economy grew at a 1% growth rate
Springsteen Sells to Sony for 500b! - Variety