Every so often, in sharing a story about a “Disruptor” catalyst making waves around us, I’ll recommend a story-related stock.
One recent example was IAC/InterActiveCorp (Nasdaq: IACI), which I recommended in my June 12 report “Today We’re Going to ‘Fix You Up’ With a Winner.“
It’s only been two weeks, but IAC is already following my storyline.
Of course I was trying to be funny with the “Fix You Up” reference in the title, as the story was about online dating in general. But I was quite serious in predicting that Barry Diller’s IAC/InterActiveCorp would spin its Match Group of properties into a separate company and issue shares to existing IAC stockholders.
Well, it didn’t take long. Sure enough, last week IAC said it was going to do just that, and spin out the Match Group into a separate company.
In my report, I accompanied my recommendation with a specific “Buy” strategy.
I still like the company, but today’s markets are fluid – meaning the strategy I detailed needs refining.
Today I’m going to do just that. And you don’t want to ignore it…
It’s true. Starting sometime next year, Goldman Sachs Group Inc. (NYSE: GS) – the poster child Wall Street investment bank of the 1% of the 1% of the superrich – is going to lend money to the remaining 99% of consumer borrowers.
Don’t bother getting all suited up with hat in hand for a visit to a local branch of Goldman Sachs Bank USA (with its $73 billion in deposits) – there won’t be one.
And don’t even think about walking into the bank’s office at 200 West Street in New York City – you won’t get passed security.
However, with Goldman’s new lending strategy, that walk-in access won’t be required.
Goldman Sachs, you see, is getting into online banking.
This new venue of borrowing was known as P2P, or peer-to-peer lending – until big money transformed the P2P moniker into “power-to-profit.”
Bond market volatility in the face of serious liquidity issues is making front-page news.
That’s no surprise to us: We’ve been talking about the dangers of low market liquidity for some time. That dwindling liquidity is a “Disruptor,” or catalyst, that will eventually destabilize first bonds – and then stocks.
Suddenly, others are discovering this danger. There’s a rising cautionary chorus from such luminaries as doomsdayer economist Nouriel Roubini; the always-smiling (look and you’ll see that it’s true) Goldman Sachs Group Inc. (NYSE: GS) president and COO, Gary Cohn; departing (because his bank’s been fined billions) Deutsche Bank AG (NYSE: DB) Co-CEO Anshu Jain;and JPMorgan Chase (NYSE: JPM) CEO (and self-appointed bank-sector cheerleader) Jamie Dimon.
Those leaders – and others – are openly voicing the same warning: The bond markets are headed for trouble.
And a new “fix” that’s being “worked up” only makes the calamitous scenario I’ve sketched out for you all the more likely.
Earlier this week on Fox Business, Stuart Varney grilled Shah about which stocks he would buy – and which ones he won’t touch.
Chipotle Mexican Grill Inc. (NYSE: CMG) is one company Shah says he’ll happily avoid. The stock, he says, is hugely overpriced, and increasing difficulties sourcing its organic products will create financial problems for the company. In line with his thinking, Chipotle’s stock price is fading – and Shah’s glad neither he nor his subscribers are shareholders.
Tune in to the video below to find out whether Shah is or isn’t buying Netflix Inc. (Nasdaq: NFLX as well as several other big names.
Though not many folks know this, the credit crisis-spawned stock market crash of 2007-’09 created a hefty number of millionaires
There’s a reason for this, and that reason sits inside the simple market maxim that every crisis is accompanied by big opportunities.
As I’ve been telling you, thanks to the mess that’s been created in Europe, the global bond market – which dwarfs the stock market – is careening toward a major crash that governments and central bankers will be powerless to stop. And that bond-market collapse will serve as “Ground Zero” for freefalls in stocks and other financial assets.
However, if you act quickly, you won’t need to panic.
Today, I’m talking with Money Map Press Executive Editor William Patalon III about just us what to expect – and about what you should be doing… including specific investments you should be making.
In last week’s report on Social Disruptors, I told you about my foray into online dating.
I appreciated all the comments, stories and advice that you shared, and I promised to tell you how my own experience turned out.
The “hot date” I told you about ended up being lukewarm. (The photos she’d posted of herself were about 10 years old – from a “happier” time in her life, she told me.)
But that’s okay… that’s the great thing about online dating – it’s easy to meet other people.
In fact, this reminded me of my days in the trading pits: If a promising opportunity didn’t work out as hoped, you took the loss quickly and moved on – knowing there were lots of other opportunities out there.
In a world where folks are busier than ever, that ability to find new opportunities – to easily meet new people – is the big attraction to online dating. That’s why it’s become a $2 billion business.
How far can this stock go? That’s what Shah wants to know. Between rising costs, great momentum and controversial growth, Shah says Netflix Inc. (Nasdaq: NFLX) may have finally reached its peak.
That’s not the only topic Shah dug into on Fox Business today. Before he left, Shah forecast just how high Apple Inc. (Nasdaq: AAPL) stock is going to go – and let us know what he thinks the latest announcement from Boeing Co. (NYSE: BA) means for stockholders.
A week ago, in a strategy piece detailing ways to handle the looming bond-market crash, I recommended shorting the iShares PLC Markit iBoxx Euro High Yield Bond ETF (LON: IHYG).
Several readers wrote in to say that “not every brokerage lets you buy this.” Some do, in fact: In this day and age, many brokerages let you buy any shares, anywhere. But for those of you whose brokerages won’t let you, I wanted to give you an alternative.
We want a trade that gives us the exposure we want, which is a bet on falling bond prices – both sovereign and corporate – across Europe.
It’s hard to find an exchange-traded fund (ETF) that gives us this type of exposure. Some of the instruments that come close don’t have the liquidity we need to be able to get in and out easily.
And the rest don’t fit the trade profile we want.
However, there’s another way to play falling bond prices across Europe…