Sanctions and the Reserve Currency

Unintended consequences of sanctions.

Canadians have lost trust in their banks as account were frozen. Wouldn’t freezing central bank accouns do the same for whole nations?

An interesting survey of the US$ from Bretton Woods to the invasion of Ukraine:

A word of warning for the fragile, the interview is hosted by Glenn Beck. :wink:

HUGE ripple effects from today’s oil market INSTABILITY

What exactly is going on with the oil industry, the petrodollar, Russia, China, and the U.S.? Professor and economy expert David Buckner joins Glenn to break it all down. He explains how current oil sanctions have caused massive, market instability and he details ripple effects the world — specifically the U.S. dollar — may experience as a result of it all…

https://www.youtube.com/watch?v=TbKRgF9gDts


The value of hard currency is that it is accepted everywhere. What to do when the world’s reserve currency crumbles? How about hard stocks like TSLA? Just a thought.

BTW, Saddam Hussein and Colonel Gaddafi were taken out because they threatened the PetroDollar, Saddam proposed selling oil in Euros and Gaddafi in Gold Dinars.

Gold Dinar: the Real Reason Behind Gaddafi’s Murder
May 3, 2019

The gold dinar: a groundbreaking initiative
In 2009, Colonel Gaddafi, then President of the African Union, suggested to the States of the African continent to switch to a new currency, independent of the American dollar: the gold dinar.

https://millenium-state.com/blog/2019/05/03/the-dinar-gold-t…

Food for economic thought…

The Captain

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Canadians have lost trust in their banks as account were frozen.

Only the criminals who couldn’t make bail. You might want to move your money to Russian banks?

https://www.nbcnews.com/news/world/police-arrest-two-leaders…

These idiots actually thought they were going to dissolve the Elected Canadian Government and rule by a committee from their midst. Now they will be limited in their power to the size of their jail cell.

Our banks are fine.

Canada has one of the safest banking systems in the world. The Royal Bank of Canada, TD Bank, Bank of Nova Scotia (Scotiabank), Bank of Montreal, and the Canadian Imperial Bank of Commerce all rank within the top-35 most stable banks in the world.

The nonsense level is growing.

Anymouse

https://www.nbcnews.com/news/world/police-arrest-two-leaders…

Canadian police clear Parliament street, arrest dozens of protesters in bid to end siege
The street in front of Parliament Hill, the collection of government offices that includes the Parliament buildings, was the heart of the protests.

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<How about hard stocks like TSLA? >

What is a “hard stock”? And why would TSLA qualify?
Wendy

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A word of warning for the fragile, the interview is hosted by Glenn Beck. :wink:

If not wanting to listen to a person who has a long history of exaggerating and being heavily one-sided makes me fragile, not sure how exactly to take that. But… ok. Personally I prefer hearing from pundits who are a bit more… rational and grounded in reality.

Perhaps Glenn would prefer we fight this with mortars and missiles rather than with sanctions. Perhaps he’d rather risk a nuclear WWIII. I think most the other countries would agree. The impending death of the dollar is being exaggerated. But hey, that’s par for the course for some.

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not sure how exactly to take that.

In times of stress, humor is a helping hand.

I do tune out some people who have never contributed anything worthwhile but it’s good to hear from all sides and then decide. In the linked video, Glenn Beck is the host, the views are the guest’s.

Let’s face it, the US dollar as the world’s reserve currency is a huge advantage for the US. News and opinions about attacks on this valuable asset surely count as Macro Economic.

Personally I doubt there is an endurable economy powerful enough that can replace the US dollar as the world currency for now. I firmly believe that the CCP is shooting the Chineses economy in the foot. Look at the crap-hole Russia is in.

The Captain

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What is a “hard stock”?

To me a “hard stock” is one that has been paying increasing dividends for decades.

Or you could look at these:
https://www.bing.com/search?q=stock+paying+increasing+divide…

Desert (CVX, XOM, T, BNS, BKH, ED, ATGFF, NI, NWN, TRP, ENB, WRE, WGL, XEL, DUK, SO & KO) Dave

What is a “hard stock”?

Hard as in hard currency.

An investor’s stock as opposed to a trader’s stock. The stock of a company in a great market or better yet, in several great markets that will paint “S” curve after “S” curve on the price chart, not a one trick pony that for lack of new ideas starts empire building instead of innovating. A company with pricing power, no 10% customers, better yet a huge number of smallish customers. A company with a verifiable Total Addressable Market (TAM), not just pipe dreams. A company with easy to understand products, easy to track sales volume and revenue. A company aligned with the issues of the times (global warming, climate change, air pollution, energy, labor markets, high tech). A company with outstanding leadership. A hard stock is a buy and forget stock.

AAPL after Steve Jobs’ return to Apple, is a hard stock. Most Saul stocks don’t qualify because they sell very complicated products or services. Saul is successful because he has the uncanny ability to turn on a dime, a trait most of us don’t have.

We have been trained to fall in love with the latest and greatest but that by itself is a bust. For example, TMF’s 3D Printing recommendations, they fell off a cliff and have yet to recover. 3D Systems Corp. (DDD)
https://bigcharts.marketwatch.com/advchart/frames/frames.asp…

I came across a video forecast about 14 great industries of the future. I’ll use them to illustrate;

  1. Internet of Things
    Discussed at length at the NPI board. A growth industry for sure but there are no great companies worth investing in. It’s essentially a commodity market.

  2. Artificial Intelligence (A Tesla division)
    About 20 years ago there was a good discussion at NPI about who would benefit the most from high tech, users or producers. Users won the day. As of now there are no great AI investments but Tesla is a mega user, now for self driving and in the future to animate the Tesla Robot, Optimus
    https://www.youtube.com/watch?v=n_aqyGZoS9k

Tesla is building Dojo, a super computer specifically designed for AI to train neural networks. There is speculation that in the future AI with Dojo might become a Tesla service, a future “S” curve.

  1. Cyber Security (A Saul favorite)
    The difficulty in this industry is understanding the products. There is quite a bit of leapfrogging going on.

  2. Genomics (A Cathie Wood favorite)
    Nassim Nicholas Taleb of Black Swan fame rates biotech ‘A Good Black Swan industry.’ By this he means that some companies will hit the ball out of the park but we have no clue which ones will do it. This is best left to angel investors and venture capitalists. You have to buy the basket, not just individual stocks.

  3. Drones
    As of now I have no idea which drone company, if any, is worth investing in. Most likely existing companies will add drones as one more product line.

  4. Robotics (A Tesla project)
    As noted above, the most important aspect of humanoid robotics will the their artificial intelligence. The robots on assembly lines are pretty dumb. Amazon makes great use of robots in their distribution centers, another example of users getting the most benefit from technology.
    https://www.youtube.com/watch?v=IMPbKVb8y8s&t=205s

  5. Virtual Reality
    Like with drones I don’t know any investible providers. Tesla uses graphic simulations to automate the training of neural networks.

  6. Nano Technology
    Same as drones and virtual reality.

  7. Renewable Energy (A Tesla product & service)
    While Tesla’s current major business is EVs, it is vertically integrated and tries to make the best use of batteries and solar panels. A future “S” curve.

  8. Sharing Economy
    Robo taxis? A future “S” curve.

  9. E Learning
    Gaz has better info here.

  10. Big Data (Tesla driver feedback)
    There are some Big Data stocks on Saul’s board. Same issues as cyber security.

  11. 3D Printing
    With the exception of metal parts for airliners (jet engine parts) 3DP has not lived up to its billing.

  12. Blockchain Technology
    No opinion.

At the end they ask for suggestions. They omitted the most obvious, Electric Vehicles!

This market is well defined, the objective is to transition from ICE to electric. Most of us understand cars. Shipments are tracked in great detail. Unlike cyber security and others we can actually test drive the product! Tesla has pricing power, they just raised prices again. Elon Musk is a communicator. EVs have the backing of governments, Chineses cities need to get rid of the SMOG and it’s very difficult and expensive to get license plates for ICE vehicles. Gas prices in Europe are sky-high which encourages buying EVs. While EVs are the current “S” curve driver, Tesla is preparing other “S” curves, most notably energy and robots, and on a smaller scale insurance and AI.

One of the biggest objections of Tesla bears is ‘The Competition is Coming!’ The only reason the competition is coming is because the incumbents have finally realized that EVs are the future and they have no choice but to get on board. I did not invest in TSLA until after their Battery Day (Sept 2020) when it became clear that the EV technology had Crossed the Chasm. How did I know? The competition was coming!!!

Tesla has the goal of producing 20 million cars in 2030, a growth rate of 50% starting in 2021. That would give Tesla a 20% or 25% global market share. I have a hard time believing they will surpass that number. For TSLA, the stock, EVs will transition from growth to cash cows. By then one or more additional “S” curves should be in place, energy, and robots, adding another ten years of buy and forget. By then I’ll be a centenarian and probably pushing up daisies. Maybe I’ll do like the pharaohs and take my shares with me.

I hope this brief overview illustrates the many ways in which TSLA is a hard stock.

The Captain

14 Growing Industries of the Future [2022 Edition]
https://www.youtube.com/watch?v=cEUJ0EO-ncA

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Perhaps he’d rather risk a nuclear WWIII.

As long as they can push y’all to the edge of nuclear war to make you do something, they will win every round.

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As of now there are no great AI investments

I’ve got my eye on Upstart (UPST), which is a hyper-growth fin-tech whose core product is AI, just scaling into the $1billion/year revenue stage with their AI personal loan qualification product and beginning to scale up an auto loan product, with small business loans and small dollar loans next before they ultimately tackle the mortgage loan marketplace.

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I’ve got my eye on Upstart (UPST), which is a hyper-growth fin-tech whose core product is AI…

It’s a question of definitions, above I prefaced AI with, “About 20 years ago there was a good discussion at NPI about who would benefit the most from high tech, users or producers.”

Upstart (UPST) is a fin-tech that provides an exchange using AI. Same as Tesla providing FSD using AI. If someone developed an AI platform that users can apply to their business, that would qualify as an AI investment by my definition. Say Tesla spinning out Dojo as an AIaaS to let other train their neural networks, whatever they may be.

I too had my eye on Upstart (UPST) but I think we all got caught up in the excitement of the bubble. Upstart needs to prove itself in more normal conditions:

https://bigcharts.marketwatch.com/advchart/frames/frames.asp…

Looks like the Gartner Hype Cycle:

https://www.google.com/search?q=the+hype+curve&newwindow…

The Captain

3 Likes

Upstart (UPST) is a fin-tech that provides an exchange using AI. Same as Tesla providing FSD using AI. If someone developed an AI platform that users can apply to their business, that would qualify as an AI investment by my definition.

These guys:
https://sambanova.ai/

But they are not public yet.

I too had my eye on Upstart (UPST) but I think we all got caught up in the excitement of the bubble. Upstart needs to prove itself in more normal conditions:

Looks like the Gartner Hype Cycle

https://en.wikipedia.org/wiki/Gartner_hype_cycle

I’ve never seen the Hype Cycle graphs before, thanks, though I’m aware of the cycle. I wasn’t interested in Upstart during the hype phase, but now that it’s got real earnings and is still growing fast and the stock is WAY down from its peak, I am interested in potentially buying during the ‘Trough of Disillusionment’. :slight_smile:

I’m hopeful the negative market sentiment on growth companies will carry it back down to recent lows and lower. Today it’s popping up a bit on some positive news that Subaru is adopting their tech, going against the market trend today. Hopefully that news will only give it a short bump and the downtrend will continue. I’m aware I may not get an entry price I want with this waiting game, and that would be okay.