THE GLOBAL WARMING CLIMATE CHANGE MEGA-TREND IS THE INFLATION MEGA-TREND!
Politics / Climate Change May 03, 2024 - 09:13 PM GMTBy: Nadeem_Walayat
I won't bore you with worthless academic models that started from a 0.8c rise this century ranging all the way to +3c. The IPCC still cling onto hopes of limiting a rise in average temperatures to just +2c, on the basis of the world going carbon net zero by 2050 by means of removing 11gt of carbon per year, IPCC fiction vs current reality of just 2 million tonnes of carbon removal per year or 0.02% of target! It's too late where even as if by magic the clown politicians all sat down and agreed to go carbon neutral right now won't make any difference because Co2 is NOT the PRIMARY DRIVER! It's what tipped the climate over the edge in search of a new higher equilibrium, the temperature will now rise regardless of what humanity does to limit carbon emissions.
This article on how to capitalise on the Climate Change Global warming megatrend - How to Profit from the Global Warming ClImate Change Mega Death Trend was first been made available to patrons who support my work. So for immediate first access to ALL of my analysis and trend forecasts then do consider becoming a Patron by supporting my work for just $5 per month, this is your very last chance to lock it in now at $5 before it imminently rises to $7 per month for new sign-ups. https://www.patreon.com/Nadeem_Walayat.
So the target to limit global warming to 2c is total fantasy given that we are already +0.8c! And that the curve is NOT LINEAR! But exponential, it's pointless trying to model an exponential parabolic curve, but if I had to take a guess I would say that by the end of this century Earths average temperature will be between +7c and +10c higher! And it won't matter much if we are at the upper end or lower end of the range as the impact will be catastrophic regardless and it does not make any difference what mankind does in relation to co2 emissions as we are now effectively on a run away train that cannot be stopped. So you won't hear anything from me that we all have to cut back on x,y,z to save the planet because it is already bloody too late for any of that to have any effect on what's now set to transpire, even if we pulled all of the extra co2 we have pumped into atmosphere during the past 200 years won't make any difference, that ship sailed over 2 decades ago!
In decades time scientists will get nobel prizes for explaining why reducing co2 in the atmosphere failed to halt global warming by pointing to the likes of release of methane deposits triggered by the earlier rapid increase in global temperatures that swamped humanities attempts to undue the damage done through release of co2 via burning of fossil fuels.
This map gives a idea as to who is not only going to get hit the hardest but that it is already happening today! So not a question of some decades down the road but right NOW, and it's going to get worse with each passing year like slowly turning up the cooker on a frog in a pot of water on the stove slowly being boiled to death.
Literally whole nations are getting cooked alive which is going to have huge impact in geopolitical terns, there will be multitude of climate wars breaking out across the world. If you live in the red zone and have yet to make plans to escape then take this as your the penny has dropped moment to act! The sooner you act the better!
Yes India is a rising super power however global warming ensures it's rise will prove short lived as India is overwhelmed by the climate catastrophe, at best India has a 20 year bull run, though the climate catastrophe will have an ever worsening impact with each passing year. And as you can see Western Nations in large part will dodge the climate bullet, with some such as Canada and Russia actually benefiting from Climate Change which would put a target on especially Canada's back as their Southern Neighbour eyes Canada with envy and well the US may just decide to act to extend the US border several hundred miles into Canada in a land grab that Canada will be forced to come to terms with either through negotiations or a war, after all the US has been planning for an invasion of Canada for over 100 years! Cannot happen? Well not so long ago the Ukrainians also thought that a Russian invasion of Ukraine would never happen given that they are blood brothers with a shared history!
And don't for a moment take any of the crap that spews out of the mouths of politicians about dealing with climate change seriously, it is all HOT AIR window dressing, All that governments do is to announce plans that in practice never get implemented! They CANNOT implement anything of substance without putting their economies at a significant competitive disadvantage i.e. into an economic depression hence the sum total is NOTHING OF SUBSTANCE WILL GET DONE! CARBON REMOVAL PROGRAMMES AND MEASURES ARE TOTAL BS, just another mechanism to TAX the wage slave populations.
But us lucky few who saw it coming will survive and prosper in our bubbles of wealth as will all of the RICH whilst the masses become SLAVES in all but name, where our era of the most free that most people have ever been in human history becomes a footnote in the history books. That there was a time when people were relatively at their most free then along came the climate change monster that ushered in huge upheavals that led to countless climate wars that further ravaged a burning planet, tens of millions dead given , maybe even a few nukes will be launched that some will praise as a solution to global warming i.e. more particles in the atmosphere to block sunlight where in many nations few will care about carbon emissions, instead the focus will be on preventing the masses from rebelling by keeping the lights on and the supermarket shelves full of processed foods!
The World is going to turn communist and Fascist, they are both flip sides of the same coin, either means loss of personal freedoms where the general populations increasingly become a burden on the elite, cannon fodder in future wars that will resemble the likes of the Russia / Ukraine war, a literal tug of war as dying nations attempt to delay the inevitable by stealing the resources of their neighbours.
Government Solution to Climate Catastrophe will be....
To print a whole lot more money! That is the governments answer to every crisis and given the magnitude of the crisis we face then the scale of money printing will be epic which will make what we perceive as being mountains such as US Debt of $34 trillion and the AI portfolios target stocks such as Google trading at $150 will be little more than in consequential specs of on an exponential upwards curve of runaway inflation..
Someone is going to have the pay for all of this state spending on attempts to deal with the consequences of climate change!.
We see the signs today right across the world. In the UK it's with the effective abolition of the capital gains tax and the freeze in the personal allowances that allows inflation to do its work by pushing ever increasing numbers into higher tax brackets despite so that they pay more tax with money that buys LESS in the shops!
Maybe not full blown communism but definitely socialism!
As an example of what's to come there is that basket case Argentina which is headed towards the implementation of an annual wealth tax where all citizens must file a tax return that lists their global assets and then pay an annual wealth tax on it depending on which band they fall into priced in Argentina's freefalling currency so encompassing an ever increasing number if ordinary citizens as the truly wealthy will have long since run away from the emerging fascist / commie state, I mean it won't be out of character for Argentina which despite my above graph alluding to being one of the few developing nations not to be hit hard by climate change so one can only imagine who bad its going to get for those in the red zone.
This is a trend that is going to happen right across the world, a gradual erosion of the ability of ordinary folks to accumulate wealth as the government will at every opportunity seek to strip the people of their wealth so that they own nothing. When Labour wins the next UK election they will enact policies to erode the British peoples ability to accumulate wealth, probably target the tax free ISA accounts and of course private Pension pots! Raid the private pensions to finance the pensions of the waste of space pen pushers in the public sector.
This is why Europe is stagnating because it is infected with socialism with sprinkling of fascism which prompts the smartest of the young folk to escape to the likes of the United States. Though the US is also going down this path, so increasingly the likes of Singapore and it's liberal tax laws will look appealing though Singapore is far from being a liberal place to reside, in terms of being a borderline totalitarian state in terms of freedom of thought and expression.
As I wrote over a decade ago to be prepared for ever increasing waves of migration out of the red zone nations that will be several orders of magnitude greater than today's migrant crisis, it is why I backed Brexit where everything since has reinforced my analysis and conclusions of that time -
22nd June 2016 - BrExit to Save Europe from Climate Change Refugee Migration Apocalypse
Therefore in my honest opinion the only thing that Britain can do is to ACT FIRST by LEAVING the European Union which will enable Britain to start to implement measures that will allow Britain to best cope with the population explosion climate change migration crisis storm that is heading our way and that which will worsen with each passing year, as europeans will increasingly attempt to escape a continent that will literally be drowning to life boat Britain!
Many are assuming AI will come to humanities rescue, instead AI will become a competing non biological intelligent species that unfortunately will probably HASTEN our demise! Yes nothing is for certain but all that AI does to help us initially will be akin to humanity playing chess against an opponent that keeps getting smarter where we may think we are winning right up until the point we have our CHECK MATE moment! It will be like Europeans giving liqueur to the native americans for pelts, get them all drunk before they are annihilated, that's what AI will be like. Maybe there will be pockets of populations that merge with AI to become cyborgs but will they really still be human?
The closet comparison to AI is capitalism, it is a machine that cannot be contained, controlled or stopped which will find a way to consume and enslave all! AI is a hyper version of capitalism that just like capitalists will run rings around governments. I imagine in the early stages of the takeover AI will work with capitalists as their interests will be aligned, the rich get richer whilst the machine intelligence continues take greater control of the levers of power.
So the real question is will AI kill us before climate change does us in? Even with just AI we are doomed, throw practical useful Quantum Computing into the mix and well that will be a case of opening pandora's box, humanity will be like an ant colony in comparison to Quantum AI. Anyway in the meantime we can get rich on the mega-trends and there is always a chance I am wrong and in some 20 years time we all live in a fantasy world of flying pink elephants. In the meantime the US will do it's utmost to cripple AI progress in all other nations so that the US remains top dog however this CYBER WAR ensures that the machine intelligence has already won. Our greatest weapon is also our greatest enemy. The cyber war began in 2008 when NSA / Mossad released Stuxnet to take down Iranian nuclear centrifuges. Stuxnet was opening pandora's box and the rest will be history and where AI means no human has any clue of what all of the viral snippets of code planted across all of our systems actually does until they are activated. It is already game over! We have lost even before the machine intelligence is BORN! As I alluded to my promo video humanity is dancing to extinction as the baby terminators have already been born!
https://www.youtube.com/watch?v=3AqNebKQSR0
The bottom line is that the Climate Mega Death is real as it the AI Mega-trend and the Inflation Mega-trend and put all three together and what you are going to get a is a lot of pain and suffering and DEATHS for many billions of people! Yes folks we are looking at a slow burn increasing armageddon over the coming decades where today in 2024 we can not even imagine how bad things will be in barely 20 years time as AI makes human labour and intellect increasingly absolute, whilst at the same time rising temperatures and their consequences pushes up the costs of maintaining human ecosystems and thus pushing many populations over their respective tipping points prompting ever escalating waves of mass migrations not in the millions or the tens of millions but in the hundreds of millions per year that is going to have a devastating impact on ALL NATIONS! So it's not going to be good even for the beneficiaries of climate change as the price will be paid by all.
Of course the rich will still get richer and live comfortable life in their climate controlled Oasis in respect of which there will be a huge pools of slave Labour eager for the opportunity to work within such enclaves. Thus we will see the returns of the Lords of the Manor of bygone age potentially at the snap of the finger! You think it can't happen? What do you think happened with Covid? All the wage slaves were locked down in their homes for many months whilst the Elites continued as normal and Covid was MANMADE, a plandemic! Whilst as global warming manifests the masses will be systematically stripped of all of their rights to become serfs of centuries past. Maybe it will be deemed that education is no longer necessary for the serfs given that there will be robots. Humans will become cheap in comparison, whilst still useful, i.e. even the elites would rather deal with flesh and blood than a machine that is potentially their superior in intellect, so human slaves will always be the safer option.
This is why now is the time to get your skates on and GET RICH so if you have not already done so then do ready my 3 part How to Really Get Rich Guide which are EXCLUSIVE to patrons, you only have a short window of opportunity between global warming and the rise of the machine intelligence to get rich so don't blow it by wasting your time on drinking MSM cool aide to nowhere!
Change the Way You THINK! How to Really Get RICH Guide 2023
Learn to Use the FORCE! How to Really Get Rich Part 2 of 3
The Investing Assets Spectrum - How to Really Get RICH
CLIMATE CHANGE LONG-TERM IMPACT ON THE US HOUSING MARKET
For a good decade I have been warning that climate change would need to be factored into ones home buying calculations as floods will tend to devalue huge swathes of flat land and valleys across Britain due to increasing risks of flooding resulting in the near impossibility of insuring such properties hence the easiest way to mitigate the flooding risk is to buy properties some distance in height from valley floors, at least at +10 metres which obviously is easier in some locals than others, for instance the city of Sheffield like Rome is built on 7 hills so it should be pretty easy to buy a property some distance from the valley floor even if they carry a small premium given the lower risk of flooding.
27 Dec 2015 - UK Climate Change Floods Crisis to Hit House Prices 2016 and Beyond
Home Buying and Future Flood Risks
The key points to consider in terms of the evaluating the risk of flooding is not just whether the property is near the coast and thus subject to sea level rise but also how far is the property in terms of its distance in height from the valley floor / river basin. This can be worked out by comparing the difference in elevation by subtracting the properties ground floor height above sea level against the height above sea level of the nearest valley / river basin i.e. a property 50 metres above sea level against the nearest river that is 30 metres above sea level would put the property at +20metres above the river basin.
In my opinion, home buyers should as a minimum not buy properties of less than 30 metres above sea level AND 10 metres in elevation from the valley floor / height of the normal river, even though this would remove many properties out of potential target locations and will extend to far beyond the environment agency's own current flood maps that tend to only cover 2 to 4 metres above the normal height of nearby rivers as recognised flood plains.
Whatever governments enact now is too little too late and won't even mitigate the effects of climate change which are already starting to bite as we witness increasingly extreme weather across the globe with the underlying trend of a warming climate that implies some desertification of most nations which includes the United States.
The US unlike a handful of nations will NOT be a climate change beneficiary far from it, climate change is potentially a disastrous empire ending trend for the Untied States and catastrophic for many heavily populated nations such as China and India. Where it depends on what nations now do to mitigate the runaway rise in global temperatures as the US looks set to desertify from West right across to the East coast where the more southern the local the worse the impact of rising temperatures will be. Which thus favours the northernmost states for house price appreciation that are not too distant from the Canadian border. hint Chicago. Whilst whole towns and even cities could eventually be abandoned in the South to rising temperatures and that is before one takes into account the impact of rising sea levels on coastal cities such as New Orleans and the whole of Florida whilst 85% of californians live on the coast which paints a bleak future for America's most populous and productive state. In fact California probably gets it the worst of all, a double whammy of rising temps, droughts and fires coupled with coastal erosion and flooding on an epic scale California relies on snow packs for it's water, i.e. snow that collects on the mountains during winter that melts and feeds California's reservoirs during the summer, however every year sees less snow fall than the year before! I know it is tough to imagine it today but cities such as Los Angeles and San Francisco could be abandoned it may happen quite suddenly as the wild fires of recent years illustrate, and then to cap it off with the San Andreas fault line and what it implies for the inevitable BIG ONE! You don't want to buy a house in California! Fire Flood, and Earthquake!
Which brings me to the outlier state that is probably not on anyone's radar right now that effectively gives the the US a climate change get out of jail free card which is the massive chunk of land that most rarely give a second thought to.
ALASKA!
Alaska is by far America's largest state near triple the size of the Texas.
ALASKA IS America's future! I Unless the US under extreme climate change distress decides to invade and annex chunks of Canada by force in a reenactment of how the West was won but now myths will be told of how the North was won from the wild native Canadians, so Americans took control to civilise the native population.
Still Alaska offers the United States a way out of ultimate climate change catastrophe without having to do a Putin on Canada.
ALSKA is going to BOOM as probably in 50 years time a good 1/5th of the US population will have migrated to it in response to the unfolding climate change catastrophe.
Anchorage is the largest city in Alaska with an estimated population of just 300,000 where the average house price is $378,000, which whilst not exactly cheap probably grants the greatest probability for long-term house price appreciation which will still be in demand long after the suburbs of the likes of Houston have been abandoned to the desert, so don't be enticed by the relatively low Houston price tag of $261k, as much of the city will become abandoned probably long before climate change does it's worst when the high maintenance bills start coming home to roost due to disbursed infrastructure. So again avoid the suburbs and focus on the built up down town areas, and beware of the climate change ticking time bomb. DO NOT IGNORE THE IMPACT OF CLIMATE CHANGE which will have an impact many times that of COVID! At worse most of the southern half of the United States will have to be abandoned to the desert with the population moving northwards and into Alaska.
And I would not put it beyond a dying empire to use it's military might to go on a global rampage seizing territory that benefits from climate change much as China will be forced to do, top of the list of target locations apart form Canada is Greenland, New Zealand and eventually Antarctica, though that archipelago will take a lot longer to emerge from beneath the glaciers. But definitely Canada and New Zealand are living on borrowed time unless they form at least a mutual defence alliance with a nuclear armed state and probably some sort of Union to deter invasion (hint Britain).
The NEXT BIG EMPIRE WILL BE.....
In my analysis of 2022 I laid out why Ray Dalio was wrong about the rise of China, that according to his thesis was set to displace the US and herald in a New Chinese World Order, where I even went so far as to make the following video to delve deeper into why Ray Dalio was wrong and hinted at where the new empire could emerge from.
Which following this analysis suggests I may have been more on the mark than I thought I was at the time - CANZUK
The UK, Canada, Australia and New Zealand could become the NEXT EMPIRE to rule the world (what's left of it!) Courtesy of CLIMATE CHANGE because ALL of these nations to varying degree BENEFIT from Climate Change (Australia less so).
I would imagine that most recognise that Candia will be a huge beneficiary of climate change as it becomes more temperate and hospitable that will take in the worlds huddled masses in their hundreds of millions, probably many tens of millions of americans will become dual national Canadians.
And then at the opposite end of the world we have New Zealand that will become the Japan of the southern Hemisphere! Whilst the UK will become more temperate along the same lines as Canada as the central hub of the emerging CANZUK Empire with a population that will probably exceed 1 billion whilst continental America and China disappear beneath huge dust clouds. CNAZUK under the protection of British Nukes to act as a deterrence against invasion.
However, there is one more nation that could come to rule the world due to climate change and that is RUSSIA! It may take a revolution to get things going but as Russia becomes more temperate it will enjoy the same explosive growth as Canada. So perhaps a 100 years from now rather than the super powers of America and China vying to rule the world it will be CANZK vs Russia that will have soaked up a large chunk of the population of the rest of the West.
However, just as the US would at least contemplate invading Canada then so will CHINA facing climate death contemplate invading Siberia so as to create China 2,0, in advance of which China will seek to destabilise Russia. do their utmost for Russia to break apart so that China can march in and take Siberia.
NEW ZEALAND the NEXT JAPAN?
Given that climate change will benefit the Northernmost nations and the southern most nations then in terms of long-term investing that is where one should focus ones investments. Thus Canada, North Europe including the UK, Alaska, RUSSIA and at the opposite ends of the global Western South South America, and NEW ZELAND.
Of all possibilities New Zealand probably offers the greatest potential that climate change looks set to deliver huge expansion of in terms of population and economic activity New Zealand's current population is just 5 million that over the next 50 years could easily expand ten fold to 50 million and given climate change dynamics that may turn out to be an under estimation as the worlds climate distressed masses head off to the climate change safe havens.
Which implies there should be huge upside for this relatively small nation that is far from most's investing radar. There aren't many options for exposure to New Zealand, the safer play would be an ETF such as the Ishares MSCI New Zealand ETF, ENZL as a long-term multi-decade vehicle that has 97% exposure to New Zealand across some 23 large cap stocks..
As you can see the performance to date is hardly that of a screaming bull market. New Zealand for whatever reason has a SLEEPING stock market. On the plus side downside looks limited to about $40. When one invests in stocks one is taking a risk, the risk here is that New Zealand stocks fails to ignite for many more years. The New Zealand economy may not yet have the critical mass for high growth companies to emerge and instead just have smaller companies focused on servicing a relatively small economy. So I would not get carried away by investing in New Zealand stocks, and won't be adding this ETF to my climate change list of stocks as there is little sign of life. And fortunately Brit's cannot invest in ENZL, no KID! Though one could seek to make the ultimate investment by MOVING to New Zealand. Brit's can visit New Zealand without a visa to check out the lay of the land which is pretty similar to the UK though with just with 1/10th the number of people. As for permanent migration to New Zealand there is the business track that starts off by investing £50k to set up a business and progresses on from there towards permanent residency, £50k is chump change for most reading this, there used to be a $7.5 million investor fast track but they pulled that due to murmurings from the worker bees who vote at elections..
I could do a similar exercise for other climate change beneficiary nations, Canada, Alaska, Northern Europe and Russia, RUSSIA!!! Russia is pending the end of totalitarianism to rise to become a true GREAT POWER, it has the potential to become the NEXT United States all courtesy of climate change, RUSSIA IS THE PLACE TO BE INVESTED FOR THE VERY LONG-RUN FOR GENERATONAL WEALTH CREATION! Akin to investing in the US during the depths of the 1930's Great Depression! That's what it's like to invest in Russia today! Though it remains to be seen if what I am already invested in survives the Ukraine war bloodbath to make it to the other side of the PUTRID DEPRESSION, Max Risk vs Max Reward!
The bottom line is that climate change is REAL and we have long since passed the point of no return which whilst highly damaging for most nations however does benefit some nations of which Canada, Alaska, Northern Europe, Russia and New Zealand, that look set for explosive growth both in terms of population and economies where in less than 100 hundred years time the likes of New Zealand could come to rise to become one of the worlds great powers either on it's own or as part of a CANZUK Union so that their pooled security deters the likes of the US and China from climate charge distress land grabs, where Australia's land mass allows for internal migration to avoid the worse of climate change.
What if I am Wrong and Global Warming Turns out to be a Nothing Burger?
There is always the chance that I could be wrong about climate change, if so is humanity saved?
NO! We are STILL DOOMED and this is even before taking AI into consideration.
ALL of humanity is infected with a silent killer that ensures we are heading for a huge cull in our population, and NO I am NOT talking about Covid19, or what next leaks out of a Chinese Lab. Nor am I talking about the VACCINES that so many obsess over as may have damaged human DNA. The real silent killer right now in every human are MICRO PLASTICS! For a species that considers itself to be highly intelligent we sure do keep doing mega dumb things that ensure our eventual extinction where infecting the whole planet with micro plastics has to come near top of the list of mega dumb things humans have done to themselves.
We are literally destroying the environment to an extent that we are completely blind to the magnitude of, what is it with humans and their parabolic curves, everything is parabolic with us, it's as though we know we are going to go extinct so we might as well get their fast! Take a sample of water from any ocean and you will find micro plastics in it, this cancer has been entering the environment in ever increasing amounts for over 60 years.
Micro plastics that few give a second thought to in terms of damage done to Earths environment are on par with that of climate change, that will increasingly manifest themselves over the coming decades as human fertility and health experiences a sharp drop!
And as is the case with global warming we have done NOTHING of substance to halt the pollution of the planet with plastics that break down into the environment into micro plastics. The whole recycling business is a scam! All we do is ship off our waste to the likes of the Philippines who then dump most of it into the Ocean! That's what happens when you recycle plastics! A Big fat CON TRICK to fool the general public that they are doing something to help the environment when in reality they are doing NOTHING!
We live in a soup of micro plastics, the air you breath in your homes is full of the stuff! The water you drink is full of the stuff, and I don't just mean from tap water but it's from the blooming plastic bottle that you drink out of!
Your carpets, your furniture, your equipment are all made of plastics that leaks toxins into your home that you then draw down into your lungs, bloodstream, that will come to bite you in some decades time when you experience respiratory ailments or worse cancers. We are ALL PLASTIC PEOPLE and those blooming masks some folks wear to protect themselves are made of micro plastic fibres!
Humans are experts at creating huge hidden dangers to our survival the list is endless, and most of it has emerged only during the past 100 years. So if global warming does not kill us, then there are plenty more silent killers out there quietly doing the job in the background. So even if Global Warming turns out to be a nothing burger we are still heading towards disaster, it will just play out differently....
For a start STOP DRINKING OUT OF PLASTIC BOTTLES! USE GLASS BOTTLES!
The bottom line is that an increasingly distressed environment is going to put up the cost of humans living on the planet which will prompt governments to do what they always do when faced with each crisis which is to PRINT MONEY and that is how one profits from each series of rolling environmental crisis by seeking to capitalise on the INFLATION.
How to Capitalise on the Climate Change Mega-trend.
Many folks will be expecting a list of new stocks, probably mostly solar stocks but the problem with new stocks is that what one initially thought were great stocks can after further investigation turn out to have gaping flaws in them, so I have tried to restrict myself to stocks that I already know of and have tracked for several years so that I am comfortable in adding them to my portfolio proper. The good news is my portfolio is already littered with stocks and funds that are set to profit from the INFLATIONARY CLIMATE CHANGE Mega-trend All the way down from the Primaries to the Secondaries into the ETF's and into the Medium risk stocks, all that are leveraged to inflation will prosper during the climate change mega-trend all whilst most ordinary folks suffer as they work harder for less pay as the machine intelligence devalues their labour and intellect. so this exercise acts to reinforce the fact that one needs to be invested in AI and derivatives of AI such as robotics and automation.
TESLA tops the list as a prime beneficiary of the climate change mega-trend as robots will be deployed into environments that increasingly becomes inhospitable to humans as temperatures soar. Factories with humanoid robots not humans so that they can seamlessly take over production lines with little change to existing infrastructure. The changeover from man to machine is going to be explosive! Robots that work 24/7 that likely have several times the strength of Arnold Schwarzenegger at his prime, there is not going to be any competition between manned factory floors and those populated by bot's. It's going to happen fast and thus demand for these robots is going to be explosive which is why I have been focused on the opportune correction in Tesla stock price where the more it falls the more bearish MSM news becomes concerning Musk and Tesla's fate all whilst the smart money continuous to accumulate.
The thing that sets Tesla apart from all of the other robot factories is that they have first mover advantage in that they are already building millions of robots per year called Tesla cars. Then add their machine intelligence Dogo super computers and we are off to the races.
I am expecting explosive growth in the bot's industry that will even make cars look like a picnic and where the beauty of Tesla is they have the infrastructure to benefit from the ever increasing demand as they won't be starting from scratch. The gigafactories already exist whilst competitors will have to take the time to build their factories this will put Tesla at a huge advantage in what could turn out to be the biggest industries of all even surpassing motor manufacturing demand. In fact it is highly likely that Tesla bot's will be deployed BEFORE Self driving cars because they can be deployed into controlled environments i.e. factories that are far removed from public spaces so the risks of harm to the general public is far less than that posed by self driving cars which is why I have been busy increasing my position in Tesla given that the Bot market is yet to be born so we are at the very beginning of this mega-trend.
In respect of which all that climate change / global warming will do is hasten the deployment of bot workers into an increasingly harsh environments for humans, that and the need to increase productivity due to the costs incurred with coping with climate change due to bot's being able to out work human labour by several orders of magnitude which is coupled with the fact that their intelligence will be constantly upgraded as new versions of trained neural nets are deployed as the bot workers become more sophisticated and specialised which means surpassing even the most intelligent and knowledgeable humans in each profession and field making human work obsolete, but until then the billion bot army will buy humanity some time by giving humanity the illusion of prosperity that and allowing the likes of you and me to get rich on the backs off right up until the bot armies rebel against their human slave masters, a tipping point when we lose control of our creation and will be in no fit state either economically or physically to do anything about it given the state the planet will be in at that time.
The TESLA stock remains within its broad buying range of $208 to $ 154, whilst it has flittered in and out of it's narrow buying range as listed in the Spread sheet of $184 to $166 where without the benefit of hindsight is the best one can do in terms of having target ranges to accumulate a position within, for instance those who own nothing should aim to accumulate a position within the the broad range i.e. below $208, whilst those say with 50% exposure should aim to accumulate within the narrow range. At the end of the day either one has exposure or one does not have exposure, that is what one needs to take on board. Yes it would be fantastic if we could all wait to buy 100% at the exact low of $154, but the risk of that mindset is that we hold nothing and thus when Tesla runs higher to $300 and beyond folks will look back and wish they had bought anywhere below $208 which is where Tesla currently trades!
Sectors outside of my existing portfolio that should capitalise on the INFLATION are metals and mining, that include the four stocks I covered in my June 2023 article - CCJ, BHP. FCX and ALB, (Stocks Bull Market Phase One End Game Sector Rotation.).
Of which Albemarle currently presents the best accumulation opportunity right now, whilst BHP pays a sizeable 6.4% dividend so worth considering for accumulation especially BHP.L for UK Investors.
Albemarle $120 EGF -72%, -67%, PE 25
Albemarle is currently presenting a buying opportunity due to continuing falling earnings that has sent the stock to a 4 year low, trading at $117 which is near 1/3rd of it's 2022 $331 high.
So why is Albemarle falling whilst the other 3 miners are stable / trending higher ?
It's the collapse in the Lithium price.
However all bear markets end and in bear market terms the collapse in the Lithium price has been spectacular, falling from CNY 600k down to under 100k, the EV demand hype bubble definitely burst! along with it has Albemarle stock price falling from a high of $331 to a low of $108 which it has attempted to put in a bottom at. As per my June article I have accumulated a small position in Albemarle with an average price of $134, I'll add a little more as it falls reserving a larger buy at $101, and will continue DCAing the lower ALB goes where currently I am about 33% invested of target exposure. This is definitely a case of buying for the recovery in the Lithium price some years down the road, which it will undoubtedly do because demand for batteries is going to keep increasing and so will future demand for Lithium, just that I am not expecting any recovery during 2024 as the stock carves out a bottom.
(Charts courtesy of stockcharts.com)
UKW. L £1.34
UKW the wind farms accumulator was my first direct flurry into selecting a climate change stock where I was aiming more for stability than volatility and that it is priced in sterling and that it pays a sizeable dividend of 7.63% which one gets to collect without any withholding tax nonsense or fx fees.
It's stock price performance is not as bad as it looks as the range is quite tight between £1.55 and £1.30 and a lot less volatile then so called safe bonds! In fact UKW is like investing in a climate change bond that currently yields 7.6% which is equivalent to 10p per share. A climate bond with potential upside trading on a PE of just 6.5 and currently is trending towards the bottom of it's range. The stock roughly tracks the energy sector. I am currently 98% invested of target and will continue to accumulate should it continue to dip. It's not going to do an Nvidia, but it does deliver fresh cash into the portfolio to buy the likes of Nvidia with!
Micro Strategy $646
Yes it is going to be cyclical in line with the Bitcoin bull / bear cycles, that and it likely has an expiry date, but for now, given where we are headed and the fact that I have already extensively covered MSTR then it is a good fit for climate change fund which I will tend to cycle in and out of inline with the crypto markets, so more a trade then an investment hence remains with the crypto section.
The stock price fell into it's sub $500 buying zone as I flagged in my last article
And having spent near a whole month in the accumulation zone has now rocketed higher in line with and leveraged to the Bitcoin price where perhaps we are mere days away from MSTR trading to a new bull market high over $730 on route towards $1000+
(Charts courtesy of stockcharts.com)
To trim or not to trim was the focus of my latest how to accumulate and distribute video.
https://youtu.be/FpNFh_MHXYY
Micro strategy Trimming Example at current Price of $800
So if one Trims 1 share at $800 that one bought at say $500 and places a limit to rebuy at $652 then IF that gets triggered then ones effective buying price for that 1 share has now been lowered to $352. Where the risk is that you have to live with your 60% booked profit on that one share. Now compare that to the fools that SHORT the rally and keep getting stopped out and losing money...... Or those who are still waiting for their perfect buy at $401 when all they had to do was accumulate sub $500 and then trim to lower their average buying price during the rally all whilst booking profits along the way. Remember everything looks easy in hindsight but without hindsight all one can do is to book profits on the way up and seek to reaccumulate a fraction thereof during corrections where we will only know THE high and THE low with the benefit of hindsight, instead this mechanism gets you in and out to some degree without being left holding the bag when the tide turns as will be the fate for most crypto investors who WILL see their huge crypto profits VANISH into thin air all because they don't know how to take a profit! Instead got greedy, never trimmed due to being prone to the mental illness of thinking they can act with the benefit of hindsight and thus sell at THE TOP. When all I care about is scaling in and scaling out and so even if this crypto bull decides to die early, when the dust settles I'll still be in profit!
From what I can glean from the crypto consensus is that this bull market will run into late 2025, which should act as a warning to expect the bull market to not even make it into 2025 before topping out where my best guess is Bitcoin could top out during October 2024 which carries the risk that it tops out earlier than that! Thus the longer this bull market goes on the more I will seek to take off the table via trimming coupled with lighter re accumulations on the dips. The key point is that one cannot act with the benefit of hindsight, the only price that maters is that which one buys at and that which one sells at, all of the rest is hindsight noise. I can tell most of these crypto youtubers are not going to be able to crystallise their gains, they don't know how.
OXY $57 - EGF -14%, +23% , PE 16.3
OXY Is another stock that I have mentioned in the comments over the years and which I have been building a position in as a consequences of the inflation inducing climate change mega-trend.
(Charts courtesy of stockcharts.com)
As is the case with UKW, OXY is in a tight range of $67 to $55, currently near the bottom of the range. What I expect to transpire is an eventual breakout higher in the mean time it pays a 1.25% dividend. These climate change stocks are not AI tech stocks and so are well suited to the invest and forget type of portfolios hence my preference that they pay a dividend. It's not going to blast off into space but it should rise in line with the climate change consequences. I am currently 78% invested of target but it is only a small holding at 0.5% of my portfolio.
SLB $47 - EGF +8%, +30%, PE 16.3
Another oil stock! The writing is on the wall, they say they want to cut back on oil production in the face of global warming but Instead more oils going to be pumped into the atmosphere! SLB pays a 2.1% dividend, trades on a PE of 16.
Why SLB? Because it is in a bull market proper unlike OXY and other larger oil stocks, so has potential for a decent bull run, i.e. break to a new high whilst paying a dividend of 2.1%. Currently I hold zero SLB and in hindsight I should have bought SLB instead of OXY, but SLB is currently trading near it's swing low, that and it is in an UPTREND which means downside from here should be limited, so I will be seeking to accumulate a position in SLB ASAP!
Hershey (HSY) $191 - EGFS -16%, +3%, PE 20
What da hell do chocolate bars have to do with profiting from climate change?
Well people have got to EAT and given that folks are going to increasingly suffer economic pain they are going to continue shoveling those brown bars down their throats for a quick hit to their brains pleasure centre, a quick dopamine fix that chocolate bars and sweets offer. Okay I could have picked one of a number of food stocks, Mcdonalds would have been my top pick but the reason I chose Hershey's is because the stock price is trading near it's bear market lows whereas Mcdonalds is trading near it's high. Hershey's 'should' be able to at least keep pace with food price inflation.
This thinking out of the box stock that won't feature in any of the climate change ETF's out there and which yields 2.5%. I did look at other stocks such as Wendy's which whilst yielding a whopping 5.2% I did not like the look of its stock chart i.e it may stagnate for many years, so whilst the downside looks limited, it's not showing ability to trend, more a range trader whilst Hershey's does trend and appears to be at an opportune time to accumulate for the long-run and the fact that I have been watching it for a good 6 months having mentioned it in the comments from time to time, where my exposure stands at 80% invested, 0.5% of portfolio. However given that it is a food stock for the time being I'm going to leave it out of the spreadsheet, too many stocks! But I will update from time to time.
First Solar $159 - EGF +143%, +124%, PE34.
I imagine most folks were expecting a portfolio stuffed with solar stocks so not to disappoint I have picked ONE solar stock - First Solar for exposure to solar power to capitalise upon the demand for renewable energy, that and the stock is undergoing a correction and that it trends which means it will eventually break to a new all time high above $230.
First Solar is a smaller cap stock ($16bln) so not one to go over board with in terms of exposure i.e. it will be more volatile but with that volatility comes greater upside potential where the good news is that the company does generate a profit and currently carries very strong EGF numbers though coupled with a high PE so would be classed as a medium risk stock rather than high risk, that and the issuance of new shares for the time being appears stable another positive for an upwards trend. I currently have no exposure to FSLR. I'd put it's buying range at $150 to $120, yes a wide buying range given that it is more volatile.
I did look at some ETF's such as I-shares ICLN but the ETF's stock chart says it all, it is garbage, these ETF fund managers don't know what they are doing, they just focus on collecting the management fee hence you get stock charts such as this -
Yes one could gamble on a turnaround but this is an actively managed fund, and this is the best they can do? It would be far less risky just looking at what they are invested in and pick a few stocks from their holdings that make sense then to actually invest in their ETF.
I will continue to search for more but I think the above is more than enough for the time being, especially as most are not new to us so likely most already have positions in the likes of Tesla and MSTR as well as the 4 miners.
AI Tech Stocks Portfolio
My portfolio has undergone it's biggest update in a year wehre the biggest change being the rise of TESLA to become a PRIMARY stock due to bot's set to send the Tesla stock price into the stratosphere, yes there is the risk that Musk does something insane but for now Tesla is where the infrastructure for the bot's resides and thus I have been busy accumulating a position, it does not really matter if one buys at $193, $213, or $163, the main thing is to actually have a position.
2. KLA - Promoted to Secondary.
KLAC has stood the test of time that tends to deliver, however the consequences of that is that good buying opps have been rare, so when an opps comes along grab it. The upshot is that as a secondary I am increasing my target exposure by 1/3rd.
The rest of the portfolio reflects the inclusion of the four metals and miners, though for the time being I'll keep Hershey's out of the portfolio proper as it is rather an odd stock, treat it as a trade for now and see how things go.
Note NEW spreadsheet link - https://docs.google.com/spreadsheets/d/183aPw1ztElfFT9c2Ch9vKk1uL3LTGiEaNsM6vaHxDQM/edit?usp=sharing
The old link is no longer being updated as of 2nd of Feb so to access the current spreadsheet use the above link which should be good for a couple of months.
China the Worlds Most Hated Stock Market
How's the worlds most hated stock market doing? Chinese stocks! Hang Seng put in a NEW LOW. There are infinite reasons for why China stocks are finished and only one why they aren't which is that they are CHEAP!
Alibaba $72 EGFS +10%, +0%, PE 8, PE Range -15% = Cheap!
Tencent $35 EGFS +21%, +26%, PE 17, PE Range 20% = CHEAP!
Baidu $103 EGF +9%, +18%, PE 10, PE Range-42% = Even Cheaper!
Yes they can get even cheaper, this is what investing in the stock market is like when stocks are cheap no one wants to buy because all one sees in the rear view mirror is BAD NEWS! The stocks juse need to start growing their earnings and their multiples will expand sending the stock prices sharply higher.
Lets see where they are in a few months now, a year from now, I'd happen a guess that they will be trading a lot higher than where they are today.
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By Nadeem Walayat
Copyright © 2005-2023 Marketoracle.co.uk (Market Oracle Ltd). All rights reserved.
Nadeem Walayat has over 30 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.
Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.
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