Fasten Your Seat Belts…The AltVix is at All-Time Highs

People are freaking out trying to understand how the markets are rising if the world our President and media paint is so horrific.

My world is obsessed with the low $VIX.

Do not be embarrassed if you do not understand the term. Here is Wikipedia to explain better than me.

The financial markets can work in mysterious ways.

There is an old market saying that the markets climb a wall of worry. That does not just apply to the S&P. Check out the South Korean market…you know the Korea just south of North Korea:

Those silly Koreans!

But..

The worrying, excitement and panic just might be showing up in ways not measured by the $VIX.

There is a mania going on right now in the digital currency/assets markets.

It’s not a US thing either. It is global. It is technology related for sure, but I do think it is also correlated to the fear that exists in the non-digital world.

It is not just Bitcoin. Yesterday, Bitcoin hit an all-time high, but it also hit an all-time low relative to total Crypto market (less than 60% for the first time ever).

I will throw it out there that the regular fear proxies ($VIX) have now also been partially replaced by what I will start calling the digital or AltVIX.

The other side of this excitement and non fear fear will be fascinating to trade and invest in. In the meantime, as a trend investor, I am not asking too many questions…just trying to enjoy the current rides.

The Death of Retail is the Birth of Retail…Part 2

It is easy to explain trends years after they seem obvious … the hard part is to ride them with your money before they are easy to explain!

Last May I blogged ‘The Death of Retail is the Birth of Retail‘.

It was good timing. If you followed my picks at the end of the post it was a hell of a good year.

Last week, I shared a chart that was already pretty viral plotting Amazon versus some retailers:

Sexy…but as my friend Jeff Macke pointed out tonight, not all retail is dead yet:

Take a look at Home Depot as well:

Ok…so Amazon is obvious and it’s been fun to ride this trend, but the death of retail is NOT obvious and there is a lot of money to be made off trends set in motion by Amazon.

You are not too late to make massive profits. Where to start?

I really liked this piece from 13D research called ‘Death of a Salesperson?’. Read all of it. This part was money:

As The Atlantic recently observed:

“Americans are shifting their spending away from materialism. . . Travel is booming. Hotel occupancy is booming. Domestic airlines have flown more passengers each year since 2010, and last year U.S. airlines set a record, with 823 million passengers. The rise of restaurants is even more dramatic. Since 2005, sales at “food services and drinking places” have grown twice as fast as all other retail spending. In 2016, for the first time ever, Americans spent more money in restaurants and bars than at grocery stores.

There is a social element to this, too. Many young people are driven by the experiences that will make the best social media content—whether it’s a conventional beach pic or a well-lit plate of glistening avocado toast. Laugh if you want, but these sorts of questions—“what experience will reliably deliver the most popular Instagram post?”—really drive the behavior of people ages 13 and up.”

It helps explain why internet travel leaders have seen their stock prices boom (I have blogged about my long positions in $CTRP and $MMYT). It also explains why Warren Buffett has been buying the skies.

Massive waves are in motion. Try to read beyond the headlines.

Follow the Leader?

I loved this video I found in my stream today and shared it with my own headline ‘Wall Street’:

I got some funny/investing type responses including:

“Where is the contrarian?” and;

“It’s a lot like Silicon Valley”

For the person always wanting to be the contrarian…good luck. I have tried it and I do not have the stomach or the wallet. It is dangerous to follow blindly for sure, but I have a pretty good network and peloton set up.

As for the comparison to Silicon Valley…yes indeed. Some crazy leader jumps off the edge of the earth it seems and others start to follow when they see it might be safer and/or no screams are heard. This works better for me.

I am on this phenomenal journey to become a better investor. If I can help others draft behind me…great. I am drafting off others that play out on the edge and my job is to jump in behind when I think the fog has lifted a little.

Of course, once you are in the water, you have to know how to swim.

Jumping is always scary, but the sooner you learn to swim the better.

Proud Uncle

I love being an uncle.

Today I am in Tucson for my nephew Eli’s graduation, with honors, from the University of Arizona. He is the son of my wife’s twin sister. I am proud of him. He already has his first job lined up in Scottsdale working for Indeed. His girlfriend helped him find the job by searching Indeed. I met Eli the day he was born and now we are chatting about networking dinners. He would be a true millennial if not for the fact that he is graduating without a pile of debt. He realizes how lucky he is and will do great.

I also helped Rachel pack up after her first year of dorm life in the honors dorm of University of Arizona.

I have FOUR nephews at the University of Arizona keeping an eye on my sweet Rachel. Ben, Reuben, Eli and Jeremy. They are ALL in the honors college. They are all best friends. They are all amazing kids.

Next year one last nephew from the Phoenix crew, Aaron, will join them in the honors school.

I have three younger nephews in Portland, Ari, Noah and Ezi, who I don’t get to see very often. I hope to spend some time with them this summer in Coronado.

I also have a nephew in Toronto, Brandon, who is a rockstar and at his first post college job.

I have a nephew Jake who is in high school in Florida. He wants to attend University of Arizona with my son Max. Jake has a wise soul for a teen and is wicked smart and independent.

All of Rachel’s girl cousins, my nieces, live in Toronto. We text and I see them share the occasional Instagram. Jordy, my eldest niece was on a path to being a Venture Capitalist but switched gears and went out on her own to start an interior design company called ‘Curated Cabin‘. I also was lucky to meet her the day she was born and have been to her wedding and now get to see her thrive at her passion. She is already getting cover pieces in Toronto design magazines:

My Niece Sami just graduated with a PHD and will work with special need children in Toronto with a leader in research around the brain. She is pure heart and soul. I spent so much time with her and her sister Jordy because they were my first nieces and I just adored them. It’s fun to be able to chat with them as adults.

My youngest two nieces, Amanda and Bailee, have grown up fast and Bailee attends my old University, The University of Western Ontario and is off to Israel for the summer with friends. Bailee is in high school will be the last to go to college. She can handle the responsibility.

I am a lucky uncle for sure.

LOL Hunting

I take great pride and pleasure in getting an LOL. It is a currency to me.

I did stand-up comedy in college for a bit and only got heckled. I learned so much about myself from getting up on stage and failing night after night. It was really brutal.

Wallstrip was fast and furious. I had an idea and before I knew it, CBS acquired it.

Skimming Twitter has been my revenge tour. Every day I get to take news and flip it, fake shout at people, blurt thoughts and interrupt conversations.

I like to surround myself with people who are looking for LOL’s and people that will hand them out if earned. It’s a bit of a bubble for sure, but it’s a bubble full of smarter and more interesting people.

Life is short…so LOL.

The Laughing Zuckerberg!

Here is an updated chart of Snapchat tonight (courtesy of @exciteful):

I call it the ‘Rainbow Vomit Pattern’. I think it’s bearish although it’s a brand new pattern.

One of the funniest memes from the last year has been the ‘Crying Jordan’.

Here is crying Jordan after seeing the Snapchat numbers:

While Jordan and millennial shareholders are crying over Snapchat, I imagine Zuckerberg is laughing over at Facebook.

I think ‘Laughing Zuckerberg’ could make for a great meme as Facebook aims to destroy anyone or anything in it’s path. I made this ‘laughing Zuckerberg’ using Snapchat to get things started:

The Fyre Festival Stock Market Rally of 2017

Before I get started…this made me LOL today:

Ok here we go…

All weekend I was bombarded with links to the Fyre Festival. It’s as if Seth Myers, Steven Colbert and Comedy Central were colluding to create a competitor to Breitbart and The Drudge Report.

It reminded me a lot of our political system and the stock market.

Are we all on our way to the Fyre Festival?

Most of my portfolio is digital.

I do not have a point of view on oil, gold or physical products that are not socks, underwear, shoes with a swoosh, man pants or Apple hardware.

A LOT makes sense to me today as someone that is connected all day to the internet:

The Semiconductor index closed at all-time highs

Apple closed at all-time highs;

Alibaba closed at all time highs;

Tencent closed at all-time highs;

Facebook is inches from it’s all-time high;

Bitcoin is trading at all-time highs;

Twitter is miles from it’s all time highs (only because it is managed by it’s board).

Some things that will never make sense to me in this digital era:

United Airlines closed at all-time highs;

Verizon, Comcast and AT&T being given more power.

I worry more about the price of United Airlines and the power plays by Verizon/ATT/Comcast than my digital assets being priced for 2020 perfection. We all should.

The air we fly and the digital ocean we surf are being cornered by lobbyists, Goldman Sachs, Blackrock and Warren Buffett who hate our guts.

This is not showing up in the VIX, or the front pages of CNN, The WSJ, The New York Times and/or The Washington Post.

It will.

Ten to Eleven: My New Book About Lunch With Founders After They Win

Peter Thiel has a best selling book for founders on building the future titled Zero to One.

I have not read it because he’s never thanked me for the Buddy Media introduction. I hold grudges forever.

Anyways…

I have an idea for a new book called ‘Ten to Eleven‘ …lunch with founders we were angel investors in after they win.

The idea and title came to me as I was catching up today (over lunch) with Lifelock founder Todd Davis. Lifelock was recently acquired by Symantec for $2.4 billion. Todd was telling me about some of our early meetings in 2006 and 2007 (that I had of course forgotten). I was really happy that he had such great memories of my involvement as Lifelock was going from ‘zero to one’.

I told him I was really at my best with founders going from zero to one, and than, only after they were wealthy and going from 10 to 11. Todd laughed and thought that it was a winner. Todd is a genius marketer so I may be on to something.

After lunch we grabbed this photo:

I plan to do a podcast with Todd sometime soon because the ups and downs of Lifelock on the way to the $2.4 billion acquisition are epic. Hearing some of the stories today reminded me that going from zero to one (while hard) is a lot more fun, at least to me, than going from 1 to 10.

PS – I did a quick search of my blog and there are 46 mentions of Lifelock since we invested way back in 2006. While the archives are more educational for when I am wrong, it is fun to have all the memories from when I was right.

Netflix…Woops

Here is a long term chart of Netflix which will help as I go back in my blog time machine to embarrass myself:

Way back in December 2012, Netflix was starting to perk up again after it’s 80 percent fall. I bought some stock after it broke to 52 week highs and a market cap of $5 billion. That same month I headed to Richard Branson’s ‘Necker Island’ with some really smart people. I talked about my new Netflix position and everyone thought I was an idiot.

Like a putz, I sold my position for a small gain soon after.

By April 2013 the stock had doubled and I wrote this:

Netflix is just a $10 billion company and $AMZN is $120 billion. I like the Netflix subscription model better and a play into ecommerce and talent commerce (basically the distributed CAA and movie studio of the future) would be cemented.

Could it happen?

Maybe Amazon will read this and make the first move.

Either way, hard to be a bear in the age of windfall celebrityism, bitcoins and consumer delight.

Obviously Netflix has not bought Kickstarter (they still should), but I got everything else right.

Little did I know or Jeff Bezos for that matter that Amazon would be in the TV/movie business and that it would be a throw in with Amazon Prime launched way back in 2005.

Since that April 2013 post, Netflix is up another 700 percent and Amazon up over 300 percent.

Flash forward to today and you have to read this post from Michael Batnick called ‘my friend is beating me

Mark Twain once said, “It is strange the way the ignorant and inexperienced so often and so undeservedly succeed when the informed and the experienced fail.” This perfectly describes the stock market.

Today, it seems easy…own Netflix and Amazon forever. Which brings me to another nugget from Michael’s post:

The best stocks provide an illusion of safety, which is why performance chasing is one of the few things in finance that will never, ever disappear.

Disclosure – Long Amazon

The Silicon Valley Swamp?

Paul Carr is quitting the Silicon Valley Swamp after 15 years of coverage.

It is an awesome last post.

Like a shortseller that throws in the towel just before a stock crashes, I wonder if Paul quitting coverage of the Valley could be a turning point.

I don’t think Silicon Valley is a swamp. Washington and Fox News are swamps.

I do think we are seeing the nasty effects of unbelievable growth at all costs.

Look at these sales numbers from Tesla:

Here are Facebook’s:

Etherium already has a market capitalization of $10 billion and my father in law has not yet come to terms with Bitcoin. Imagine if the Netherlands had Orchidmania at the same time as Tulipmania.

A lot of money is being doled out to companies expected to grow very fast and unlike the internet bubble of 1999, get profitable fast.

These too big to stop companies (Apple, Google, Amazon, Facebook) are creating pressures in the system. I hope it does not take a crash and a witch hunt to clean up the industry.

In the meantime, I look forward to reading all Paul’s new work. Pando is an excellent site and I am a happy subscriber.