Would you invest in a company with no managers and no legal documents?
Believe it or not, that’s a question thousands of “investors” just answered with a resounding “Yes!”
Last week, I told you that the future had already arrived, that hundreds of tiny start-ups are already changing the way we live, work, conduct business through innovations in financial technology, or fintech.
I teased a breaking story about a “company” whose extraordinary name is itself indicative of the future of fintech.
The company, if you can even call it that, goes by the name of The DAO, which stands for Decentralized Autonomous Organization.
Since April 30, 2106, DAO has raised over $152 million via crowdfunding, which is by far the largest amount of “money” ever raised that way.
It closes its “creation phase” on May 28, 2016. So there’s still time for you to get into the “deal.”
But what is DAO? And how do you invest? And should you even consider it?
“The first thing you need to know about Goldman Sachs is that it’s everywhere. The world’s most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.”
The inimitable Matt Taibbi gets well-deserved credit for that exquisite description of Goldman Sachs from his April 5, 2010, Rolling Stone expose titled “The Great American Bubble Machine.”
(If you never read the piece, you owe it to yourself. You can find it here.)
Well, the Vampire Squid’s at it again…
Not that it hasn’t been at it all along – that was the point of Taibbi’s warning, that Goldman is everywhere, always looking for the next opportunity.
The word “fintech” is defined in the Oxford dictionary as “Computer programs and other technology used to support or enable banking and financial services.”
That’s an underwhelming and frankly shortsighted definition of what fintech really is.
Fintech is an emerging financial services sector that began as technological window-dressing for the back end pen-and-paper processes of finance.
But as we speak, fintech is gaining a head of steam as a hugely disruptive force in the markets, and it encompasses everything from online banking and mobile payments to bitcoin and innovations in financial literacy.
On a recent segment of, The Bloomberg Advantage with Carol Massar and Cory Johnson, Shah broke down what’s really going on in the U.S. market. He says “it’s time to be cautious and time to take some profits.” He explains why declining volumes are so “nerve-wracking” and why the current momentum in the market is just not solid.
Shah also mentions two stocks he particularly likes right now. One is a fabulous leading healthcare business, with an excellent dividend yield that he plans to hold onto long-term. The other is a “fantastic” debt-free company with $230 million in revenue. To get the inside story on the state of the market, Shah’s winning stocks and more, listen here.
Today, Shah joined Varney & Co. to officially compare today’s abominable retail sector to the “Ice Age.”
With Macy’s (NYSE: M) experiencing a 6% dip in sales and even a recent 9% plunge in its stock price – Shah claims this “new mode” will not only make stores like Macy’s obsolete but even whole malls will soon become extinct. In fact, he believes this soon-to-be $8.9 trillion trend is going to start taking over “everything” – as in making once-thriving sectors like retail completely defunct.
Another trending topic he covered was Disney’s (NYSE: DIS) recent stock price drop too, but he’s not too concerned and neither should its shareholders. He believes this decrease is a bit of a market “overreaction” and noted one major “stock booster” initiative for this household name.
Finally, Shah’s a major proponent for this major tech company whose stock is “rich and toppy” at $703/share. The thing is, he thinks it still has a tremendous future ahead of it… bringing its stock price right along with it.
It shouldn’t surprise you that the topics I cover here have their impact on the markets – and seriously affect your pocketbook.
That’s why I write about them – to give you an inside look at how Wall Street thinks, why they do what they do, how they get away with it, and who’s responsible. That way, you can have a fighting chance every day – whether you’ve got a few thousand or a few hundred thousand in the markets.
In the last few weeks, we’ve covered some of the biggest stories in the world – and have taken advantage of some great profit opportunities in the process.
Here’s a quick follow-up on a few of those stories, and how we’ve made money and are going to continue making money on these good, bad, and ugly trends.
Let’s start with two of our biggest opportunities…
Last time, we discussed the threat that the “too big to fail” banks pose to the global economy – that their size and structural weaknesses are enough to push markets to the brink.
But that’s not all…
The Federal Reserve’s manipulation of interest rates and regulatory pressure from the likes of the Basel Accords are impacting big banks’ earnings growth across the globe. How the banks are working around impediments to their profitability could trigger the next big “system shock” along the lines of what we saw in 2008.
Today, we’re going to take a look at what that “system shock” will look like, and how the big banks’ Q1/2016 earnings are just more evidence that the next catastrophe is inevitable.