Weed Prices Up and Apple Prices Down

Apple is back at all-time highs as their luxury products of the future (watches and airpods) have the lowest relative prices.

I am long Apple and all I hear is that Apple has had no new products . Meanwhile, I love my Mac Air and iPad air. I love my iPhone 7 plus but will for sure buy an 8, am waiting on a pair of Airpods and will likely buy another Apple Watch by Christmas.

As Apple become cheap luxury, up in Canada, the price of weed stocks are up 6 fold in the last year:

howardlindzon shared a chart on StockTwits

Apple is cheap and weed is expensive…

PS – This made me laugh today. Why Does Trump Jr. have such a hard time sitting?:

The Era of Mass Customization

The battle for attention is fierce. The stakes are high.

As this boom era of mass customization goes on, we will see even bigger and bigger acquisitions as leaders protect and expand attention.

The investors that have ridden this ‘moneyball’ of valuations have been rewarded with massive gains in Netflix, Amazon, Facebook, Tencent (WeChat), Snapchat and on the enterprise side Salesforce.

There will be no movie about the investors that have made the most money off this trend, but this podcast interview of Reed Hastings (Netflix CEO) by Marc Andreesen is excellent and worth your time.

Have a great weekend.

You Can Read Everything You Believe on The Internet…What a Time to Be Alive!

Never has there been a more true statement about the state of the internet.

I do not remember who blurted what is now the title of this post as I skimmed through Twitter but I laughed.

I have hit that age where I have to stop by the front desk of my hotel each night because I forget what room I am in. A friend suggested I just take a photo of my room which is genius, until I start forgetting that I took the photo…

I spent the last few days in San Francisco and it was intense. So many smart people and a blur of me pitching and getting pitched.

I am headed back home now and going to lock myself down for the next 10 days to prepare content for Stocktoberfest SIX in New York (our first), on March 30th. It is such an interesting time in the markets and fintech which is where I live. Some of the topics I will be discussing with our wicked smart lineup of speakers include:

The Snapchat IPO is already yesterday’s news. As I mentioned on Bloomberg TV a few weeks ago – $40 billion is the new $400 million. Snapchat by any measure that Wall Street has ever made up is overvalued.

Bitcoin is old news and Ethereum is the shit?

In a world of Snapchat at $40 billion and the planets of Amazon, Apple, Facebook and Google …it is hard to build financial models but does that mean we should stop?

Wall Street gave up on research long ago and is all in on machines, ETF’s, derivatives. Bloomberg just reported that fund managers will be cutting another $300 million on external research (nobody needs research when prices just go up).

In an era of the ‘last mile’ and the ‘last minute’ it might be data, not land or money that is the most important asset. At the same time…we are in an AI bubble.

Voice is the new Keyboard.

Three years ago, 27 percent of Morgan Stanley’s assets were fee based. Today it is 40 percent.

Staying private is not a fad. The US tech sector boasted 371 IPO’s in 1999 and in 2016 there were 20. The IPO market will not ever be cool again, but it is not dead. WeWork, Dropbox, Palamtir, Airbnb and UBER could file at any time.

Between incubator/accelerator Techstars, YCombinator and 500 Startups – over 3,000 startups have been funded in the last 10 years.

Banks are hard to kill and stronger than ever despite the billions raised to disrupt them.

Unrelated to everything, but hey this is my blog and I think it’s a great business opportunity and am an investor…there is a Salesforce of pot. Thank god.

Bill Gross just blogged this on the Janus website… ‘Our highly leveraged financial system is like a truckload of nitro glycerin on a bumpy road’. I don’t think he’s bullish. Thank god for him that a Salesforce of pot is here. His grumpiness may also be related to the fact that over the last five years the annualized returns for his beloved bonds is ZILCH.

The Fed has raised interest rates three times and the US Treasury yield closed above 1 % for the first time since November 2008.

Most importantly, as always and in the face of a President that has never read a book, it is easier to be an optimist. I have no idea what’s next for the markets, but my goal is to help people embrace and better understand, enjoy and profit from them.

The Digital Boom in a Few Charts and Fire Tim Cook

I had the idea for our firm Social Leverage back in 2007. In November 2007 I wrote on this blog: ‘Social Leverage – Inning One and Impossible to Value’.

It’s almost 10 years later and we might be in inning 3. The leading stocks have never been harder to value.

Social Leverage is as I predicted the new financial leverage.

While the world levered itself to social graphs, the commodity indexes imploded.

Here is a chart of the Bloomberg commodity index over the last 15 years.

The iPhone and AWS (Amazon Web Services) sum up the acceleration in the digital boom and possibly the accelerated decline in commodities. The US digital ad market will grow by 16 percent this year!

Look no further to the divergences than my sweet son Max who is quite content with an iPhone, Uber, Amazon, Netflix, Snapchat, Google Docs and excellent bedding.

Unless Donald Trump can turn off this cloud thingie, I like my continued chances with digital assets and a life of social leverage.

Elsewhere in the world of nothing makes sense to old white people that made their fortune in commodities:

Mexico is up 17 percent since Trump vowed to wall it off.

The USA is up 6 percent since Trump threatened to wall us in.

The only thing I know is that Donald Trump will take credit for everything.

And finally, how is this Tim Cook still employed:

Please Hold….

I called Metlife today to see if some dental work would be covered.

They put me on hold and made me finger dance my way to find a human.

I am sure they will find a way to not pay.

Tonight their machines called me back to ask me how the experience was.

I have them on hold.

Bill Ackman PLUS Permanent Capital EQUALS Valeant

It was all Bill Ackman late today in my streams.

It is amazing that Intel’s $15 billion purchase of Mobileye could be overshadowed by Bill’s $4 billion realized loss in Valeant, but for the moment it is. Today, both Netflix and Amazon are also on verge or breaking out to new all-time highs.

So why the fascination with Ackman?

Bill has permanent capital. In the world of finance, that is the BIGLY of BIGLY.

By scoring permanent capital, Bill had socialized all his future activist losses.

Back in 2014 I did a podcast with my friend Michael Parekh (he ran Goldman’s internet research back in the day) about Bill’s score. In the same podcast we discussed legendary venture capitalist Bill Gurley’s yellow flag raising about valuations in the Silicon Valley. Little did I know, or for that matter did Bill Gurley, he was talking about Bill Ackman.

Back in 2015, Forbes ran a breathless cover story on Bill Ackman as a Baby Warren Buffett:

Talk about magazine cover jinxes. By the way, the same Forbes cover was also trumpeting the bond crash that never happened and Honda’s flying cars. No wonder my son Max thinks reading is overrated.

Today I asked my followers to rewrite the Forbe’s headline. There were so many funny ones but my favorite was from @stratostrades who wrote in – ‘I Lost 50 pounds on Herbalife, find out How I did it’.

Tomorrow, the Ackman and Valeant jokes/memes will continue. I doubt Bill Ackman cares. The lessons from his losses here are what matters most. Bill should have followed his own 9 lessons that he shared on the internet back in 2013:

Jack Damn adds this for emphasis…losers average losers:

jackdamn shared a chart on StockTwits

Ok back to work.

The Ten Best Stocks of The Last Ten Years…Do Not Underestimate The Power of a Good List

Ivanhoff posted the ten best stocks of the last ten years back in February and it has really stuck with me.

Forgetting the individual names for a minute, it makes sense in hindsight that the internet, biotech and China dominated the list.

I have no idea if the same trends carry the same stocks, different stocks or if tomorrow one new super trend emerges that carries ten stocks I have never heard of to this list.

I do know I will easily spot these winners and own some if not all of them. I will have to do the most work on ‘holding’ them.

It does not take as much work as you might think to spot winners. These stocks spend a lot of time on the 52-week and all-time high lists. These are the two lists I check most often for ideas.

When I helped Ivan start his premium service now at Marketwisdom.com, the goal was to isolate, track and organize a list of stocks that we felt had the best overall strength and therefore the best chance at large future gains. I had been doing this the last twenty years and now formally with Ivan the last three. Ivan has a growing business and it is fulfilling work for both of us.

It is amazing that after all these years studying markets and stocks that (most of the time) I have to look up the companies on the list just to see what they do.

This week alone, I am only familiar with two of the top ten companies.

Once I have eyeballed the list, it only takes me another few minutes to look up the companies that I am unfamiliar with and start to think about the industries they are dominating and the catalysts that may continue to drive them.

By studying the list Ivan publishes just weekly, your understanding of the markets, prices, trends and psychology will improve very quickly.

Even if you do not want to buy and sell stocks, it makes sense to study this list. If you are an angel or venture capital investor it will help you think about the stocks and industries that institutions are buying. If you are younger it could help shape the skills you want to have or the career you may want to pursue. The markets are all connected and following past leaders is under appreciated.

PS – Stocktoberfest is where I pull all this thinking together with CEO’s, investors and entrepreneurs. If you can’t make it to NYC for the event March 30th, share the event link with your friends interested in the markets.

Managing Disappointment Is An Edge

I loved this piece from Morgan Housel ‘Surviving the Continuous Chain of Disappointments‘.

It’s ironic that the secret to winning was learning how to put up with losing, but there it was. “Having an edge and surviving are two different things,” Nassim Taleb once wrote.

This is a great analogy for most business and investing endeavors.

Capitalism doesn’t like edges. It unleashes competition to bang them back toward zero. When edges do arise they’re usually small. A system that gives you a 55%, or 65% chance of success is phenomenal, but it still means you’ll spend close to half your life getting beat up. Since 100% odds of success are either not lucrative, illegal, or ephemeral, the ability to survive losing is a prerequisite to any shot at eventually winning. The business world is a continuous chain of disappointments – recessions, bear markets, brutal competition, employees quitting, supply chain breakdowns, whatever – so every chance at success has to be framed as a net reward down the road amid a constant state of battle and hassle. Thorp understood this. Most of his disciples did not. Most people don’t in general.

The Bitcoin Flash Crash and The SEC is the new FDA

Stocktoberfest is THREE weeks away on March 30th in New York. I am starting to bang out the content and the awesome Guastavino venue is filling fast. The lineup of speakers is epic. If you want to make money in the markets and see what some of the best founders I know are working on in digital media, fintech and venture capital, please join us in person.

This is the first year that I have added Bitcoin and Blockchain to the schedule. We will spend some time with people that introduced Bitcoins to me at $1 (Etoro founders), Vinny Lyngham the founder of Civic.com who has been bullish on record for years, Nick Tomaino of Runa Capital who was also an early employee of Coinbase (now 6 million Bitcoin accounts), and Meltem Demimors who helps run Digital Currency Group.

Fittingly, there was a 25 percent flash crash this afternoon after the SEC stopped the Winkelvoss twins efforts to start a Bitcoin ETF:

jackdamn shared a chart on StockTwits

I don’t think the Bitcoin industry needs ETF’s.

ETF’s can be great tools, but not every tool should be allowed to offer them!

That said, I have no idea though how the SEC can ban a bitcoin ETF and allow triple leveraged ETF’s to proliferate.

With the Bitcoin ETF block leading to the ‘flash crash’ in Bitcoin, the SEC was the FDA today.

I did not add any coins today, but panics make sense when you have a digital asset that few understand and most could care less to understand. All Bitcoin panics have been good buying opportunities in the past.

Another Digital Revolution Milestone – One Bitcoin Worth More than An Ounce of Gold 

In today’s edition of the digital boom:

Not too many people have been long Bitcoin and short gold the last 5 years. 

I remain bullish on Bitcoin and the digital boom. Even at these prices I would rather own 1 Bitcoin than an ounce of gold. 

Today – 78 percent of the gold produced each year goes into jewelery.  That seems as silly to me as Snapchat seems to the gold bugs.