Printer Goes BRRR
We had been previously told that there was a 1T bipartisan infrastructure plan in the works close to being completed. Now apparently there is a back up plan, and wow it’s got a huge sticker price. This news comes after yesterdays surprise inflation jolt which did little to dampen interest rates. In a vacuum higher inflation and lower rates is good for equity prices. But vacuums are unstable on earth. Just something to consider as we get FED testimony today.
Jim Cramer says Tech is a hedge against Inflation.
I know he doesn’t know who I am, but it almost sounds like he watches every Volatility 411 video I do. This is not a surprise to anybody paying attention. When bonds go up money flows into big tech. Everybody is out there looking for the next unicorn, some are out there gambling on meme stocks, but big tech has the deck stacked in their favor. They use their mountains of cash to buy up the unicorns before they are a threat. Big tech is so rich and so flush with cash a recession is good for them they can go out and buy their targets cheaper.
Watch “You could lose everything investing in meme stocks”
Advisors loath the question, what do you think about gamestop? What about AMC? But realistically its a chance for us to demonstrate our value for our clients. They are asking for advice, seeking a get rich quick plan and are not considering the risks. And they are also asking for reassurance. Reassurance that their plan is right for them. Bottom line however, the more times I’m asked about meme stocks, and the more and more people who aren’t invested in the market start talking about meme stocks, the riskier the whole market becomes. If your Uber driver tells you he is thinking about yoloing on SPCE out of the money calls then its time to take risk off.