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Are we in a bubble? How bad is inflation? Iceland conquers the metaverse.

How bad is inflation?

It’s awful, if you listen to TV’s talking heads, who need an explanation for yesterday’s stockmarket move — up or down.

I like this chart. It averages it out. It’s from Statista. Inflation doesn’t look so awful.

Our high inflation of two days ago didn’t stop Friday’s  glorious ascent, but inflation was the excuse for the previous day’s drop.

I have friends who are more pessimistic. One sent me a piece from MarketWatch that includes:

That brings us to our call of the day from Michael O’Rourke, chief market strategist at JonesTrading, who falls into that camp with his latest note entitled “In case there are bubble doubts.”

He writes: “Since the U.S. financial markets have achieved new levels of insanity, we want to make sure we document this moment in time for posterity’s sake. Apparently, we have not learned anything from the Equity, Housing and Credit bubbles that occurred between 1999 and 2008.

“It can’t be any clearer than the fact that the S&P 500’s market capitalization is 177% of U.S. GDP,”

And, drumroll, here’s Michael’s ominous chart:

You can read the entire MarketWatch article here.

My thinking today is the same it’s been for eons:

+ Tech stocks rule the world. They capture everyone’s attention and everyone’s pocketbook. Hence they will always be overpriced.

+ If a tech stock encounters serious headwinds I might eye it through a now jaundiced eye — but that doesn’t always work. Even Facebook seems to be coming back.

PayPal confounds me. It’s disappointing the market with its slower growth and slower outlook — but not me. It managed to eke out a little gain on Friday. Maybe it’s reached its nadir? I think that means bottom.

+ The real problem: You’ve sold it. Now when do you get back in? No one gets this right. And you won’t either. Trust me.

+ I watch this stuff, smelling for headwinds. My friend Ed says the market turns when two things happen: First the Fed raises rates maybe five or six times. Second, corporate earnings peak. This one is harder to pick.

I sort, don’t freak out by the naysayers on BubbleVision or in the the financial press. They gotta have something dramatic to say, otherwise nobody would watch/read them. Or invest money with them. (There’s always a motive.)

Everyone (and their uncle) is chasing new types of investments

Like cars, paintings, sneakers, NFTs (non fungible tokens),  crypto, private oil wells, distressed real estate, startups, gold, energy, mining, biotech, etc.

Yup, you CAN make money in all these areas and pots of it — if you know what you’re doing.

That’s the big IF.

You got to ask yourself:

+ Do you have the time to learn about a new field?

+ Do you realize that, in all fields of capitalist endeavor, there are “gotchas.”

+ It can easily take you 10 years and bucketfuls of money to learn the expensive gotchas. I tried with biotech and lots bucketfuls of money.

Now I prefer sanity.

Stick with what you know. Even if it’s as little as I know.

Good Stuff

+ Premium economy is wildly popular, but increasingly hard to get into. Better legroom and better food. Not too pricey.

+ If you miss your flight, tell your airline quickly. The faster you tell them the better you may be treated. They don’t care about your story.

+ “Alexa. Call my phone.” Much louder and longer than finding it with your Apple Watch.

+ There are two three ways of getting photos from your iPhone to your laptop: You can iMessage or email them.  Or you can attach your laptop to your phone with an cable and pretend the phone is an external hard drive. Go into photos and give your laptop permission to access your iPhone. It’s easy.

+ YouTubeTV is the best. I have been playing it on multiple laptops and TV sets. You can re-wind it. You can stop it. You can record sessions. And you can skip commercials.

+ Check out Otter.ai. My friends love it.

Don’t do stupid

I played three hours of tennis on Wednesday. Now my shoulder and my arm hurts. Am I stupid or what?

I haven’t fallen down stairs, yet. I’m really careful on the last step going down. (That warning will be on my tombstone, my children have promised.)

I stop at all stop lights, and look both ways twice. I really stop. I’ve been in NYC for two days. I have seen four cars go through red lights. It’s really scary. They kill pedestrians and bicyclists in this city.

My new IPO rule

I don’t buy shares in IPOs in the first week after their IPO. They always go up and then come down. Better to wait until they come down. Don’t get caught up in the nonsense their CEOs spout on bubblevision.

 Good news from The Economist

Covid-19 is likely to fade away in 2022

Pandemics do not die—they fade away. And that is what covid-19 is likely to do in 2022. True, there will be local and seasonal flare-ups, especially in chronically undervaccinated countries. Epidemiologists will also need to watch out for new variants that might be capable of outflanking the immunity provided by vaccines. Even so, over the coming years, as covid settles into its fate as an endemic disease, like flu or the common cold, life in most of the world is likely to return to normal—at least, the post-pandemic normal.

Read the piece here.

This video has gone viral. 

it’s Iceland’s response to Zuck’s metaverse. It’s wonderful.

This one is silly, but funny. It teaches you how to text and walk.

Attending a wedding this weekend

After a year of pandemic country quarantining,  it’s truly frightening what my city closet has done. All my clothes have shrunk. Bad closet.

There  had to be a solution.

I rushed to Walgreens. Look at this wonderful new section I found:

And the premium product? You think it works?

Is there anything you can’t sell in America?

America’s #1 “Belly Fat Pill.”

I suspect there’s a cheaper way:

Eat less? Should I really try that?

I’ll update our list of preferred stocks later tonight. I bought a little TGT, a little TPR and more COST. It’s going to be a good Christmas, despite the wharves. I’m not selling NVDA.

See you soon — Harry Newton