The Angel Publishing Brain Trust

What’s this? Dow, S&P 500, and Nasdaq all down around 1%? Who’s responsible for this clear deviation from the script? 

I’ve been doing this stock market thing for 22 years. I’ve watched the price gyrations in response to currency crises, bubble implosions, outright fraud, 9/11 — you name it.

And I gotta say, I’m impressed and even a bit relieved that the stock market can still surprise me. 

2020 has absolutely been one for the record books — a pandemic event the world hasn’t seen for 100 years, a record selloff, unemployment levels not seen since the Great Depression…

Yet here we are, record highs pretty much across the board. It’s crazy, and it also makes perfect sense. 

The crazy part concerns the outlook for a pretty broad swath of the economy — leisure, restaurant, travel. We could even add in commercial real estate, given the number of companies that are committing to work from home action going forward.

Money has a lot of velocity in these areas. Bonds get sold, bond payment gets paid, rent gets paid, food is bought, liquor is bought, servers get tipped and all that keeps the cycle going. 

I haven’t checked the very latest outlook for restaurants. A couple of months ago, smart people said 60% of watering holes and steak joints wouldn’t come back. I expect that number has improved.

After all, the Fed has done everything in its power to make sure we are up to our ears in greenbacks. I gotta think some of that cheap money will find its way to new or rebooted restaurants.

Don’t Fight the Fed

One of the first stock market books I ever read was one of the Trader Vic books, and the biggest lesson he offered was “don’t fight the Fed.”

Back then, I was starved for keen insights into the inner workings of the markets. My immature brain rated this “don’t fight the Fed” stuff pretty low on the earth-shaking revelation scale. 

I learned my lesson when Fed Chair Alan Greenspan kicked interest rates 50 basis points higher in March 2000 and killed the internet. 

Here in 2020, we’ve gotten another pretty good demonstration of what cheap money can do.

I’m not telling you I bought those March 24 lows — I didn’t. My emotions were still running pretty high at that time. I had already made some moves, and I shared a few with you Wealth Daily readers on February 24.

There were three stocks in that article: Peloton (NASDAQ: PTON), Chewy (NYSE: CHWY), and First Solar (NASDAQ: FSLR). 

Peloton closed at $26.50 that day. It is ~$109 now. Chewy was just under $31 on February 24, and it is breaking over $75 today. And First Solar has done OK… $51 to $95. 

What’s Next?

I don’t tell you all this to brag. My point is simply that you are in pretty good hands with the team here at Angel Publishing. You won’t hear their names much, but founder and chief mentor Brian Hicks along with employee #3, CEO Jason Freiert, create an amazing environment of creative cooperation and competition.

We all share ideas, debate them, and we all strive to outperform the other guy with our strategies and investment ideas. Yes, we all have subscription services. But even the Wealth Daily readers get some pretty good opportunities to make some loot. 

Most recently, I told you about Freeport-McMoRan (NYSE: FCX) as a post-election play on November 4. It closed at $18 that day and hit $24 on Friday.

I still like FCX quite a bit. As a big copper producer, the potential for inflation, better relations with China, and maybe even an infrastructure bill make the perfect environment for this stock. 

At a little over $23 right now, patience will likely get you in at $22 over the next week or so…

Until next time,

Briton Ryle

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A 21-year veteran of the newsletter business, Briton Ryle is the editor of The Wealth Advisory income stock newsletter, with a focus on top-quality dividend growth stocks and REITs. Briton also manages the Real Income Trader advisory service, where his readers take regular cash payouts using a low-risk covered call option strategy. He is also the managing editor of the Wealth Daily e-letter. To learn more about Briton, click here.