I’m traveling with my son, Michael. Travel brings exciting new vistas. I found this in the Schiphol, Amsterdam airport.
The Dutch discovered that having a target in their urinals cut cleaning bills by 20%.
Except for me. Being 83, my pee didn’t go that far. The Dutch airport cleaners won’t be replaced by AI, or even generative AI.
Schiphol Airport is huge. To go from your Boston flight to your next flight somewhere in Europe will take you two hours of slogging. Which is fine by the Dutch. On your way you can buy perfumes that stink, jeans on sale but not in your size and hot dogs in a squishy, soft bun, for breakfast.
There are two camps among U.S. investors: Those who think Donald Trump won’t destroy the economy (and their stocks’ prices) and those who think the end of the world is nigh (aka Nye). They worry we’re headed for a redux (a redo) of the 2008 financial crisis which knocked stocks by 46 percent.
There are two redeeming thoughts: Donald thinks the stock market reflects his success. If the market keeps going up, he’ll be the greatest president whoever lived. Hence, he’ll do everything to make his dreams even wetter. There’s talk of the “TACO trade,” as in “Trump always chickens out.”
If it tanks, as it did after Liberation Day in April, he’ll do two things — reduce tariffs and torpedo interest rates. Fire Powell.
The reality is that things are actually going very well. Nothing has ever enjoyed the whirlwind of hype that AI is now experiencing. What’s more, AI’s beneficiaries are broadening daily — from the chip makers (NVDA, AVGO) to the data centers (CoreWeave), to the power guys (OKLO, GEV)…to the streamers (Netflix, Spotify, Meta,) to the travel companies (airlines, cruise lines, theme parks). You would not believe the crowds at Schiphol. A mega tonnage of rich, happy, fat tourists. Great for Eli Lilly and their new fat pill.
The big tariffs just went in. If stocks drop, do not panic, do not sell.
Those who didn’t sell after April’s Liberation Day are now up 20%. Idiots (like me) who panicked are flat.
The reality is that over the long-term, stocks average 10% up a year. My favorite technology index ETF is up 11.3% this year and 13.87% compounded per year since it started in January, 2004. That’s bloody good. Better than a slap in the belly with a cold fish.
Though not as well as Nvidia this year.
The Atlantic magazine just ran a piece
Does the Stock Market Know Something We Don’t?
The uncomfortable fact about its historic run is that no one is sure why it’s happening-or what could bring it to an end.
The Atlantic points out that most retirees now hand their savings over to companies such as Vanguard and Fidelity, which automatically invest the money in a predetermined bundle of stocks for much lower fees than active managers would charge.
These passive investors typically just pick a fund or two when they set up their retirement accounts and then forget about them, meaning they are automatically buying stocks (and rarely selling), no matter what.
In June 2020, for example, Vanguard released a statement bragging that fewer than 1 percent of its 401(k) clients had tried to sell any of their equities from January to the end of April, even as the economy was melting down.
You can read the Atlantic piece here.
For me, I’m obsessed. I read, study, listen to TV’s talking heads…convincing myself that I can do better than everyone else.
I can’t. I know that.
But obsession and endless curiosity worked when I ran my own company. I could make endless tweaks. Lately I’ve been doing that with my huge portfolio, which has too many stocks. I “tweak” by selling decliners and buying ascenders. So far, it’s working, sort of. You can see my portfolio in the right hand column of the web site. Click here.
The most impressive part of my “strategy” is that I have been able to dump decliners and then watch them decline even more. Here’s a two year chart of former hot stocks NVO, MRNA, ZM and UNH.
The good news about curiosity is AI. You can now ask Perplexity (and others) what are the companies likely to benefit from supplying electricity to AI data centers?
The big key is keeping track of stupid managements (UNH, NVO) or simply the end of an era (covid and MRNA).
There’s nothing I enjoy more than my obsessive curiosity. Without it, how would I ever revel in the creativity of Dutch urinals.
Why I sold my Robinhood
There are three ways to pick stocks today:
+ You can listen to the buzz (i.e. baited-breath excitement) talking TV heads, social media buzz, CEO interviews, etc.
+ You can look at the financials — P/E ratios, etc.
+ If you’re really desperate you can try using the company’s services.
Robinhood has enjoyed maximum buzz. It has gone up. I have made nice money.
Then I decided to use Robinhood’s services. I signed up and gave it $500. I figured I’d buy some VGT, my favorite Vanguard technology ETF.
Fifteen minutes on the Robinhood website later, I gave up. To wit:
+ Their website is a mess. Too many words on subjects that didn’t make sense. No on-line chatbot. And worse, no customer “support” phone number that could reach a real person. No phone number!
I had an account. I had $500 in it. I just wanted to know how to buy VGT.
I gave up. I tried to transfer my $500 back to my bank, good old reliable Chase. I figured that one. To transfer it immediately would cost me $6. To transfer in five days was free. Guess which one I picked?
I daren’t compare Robinhood to my favorite brokerage app, Fidelity, which works fast, and has people who answer my phone calls and even know my name.
Today I sold all my Robinhood stock at a nice profit. Good riddance.
I hate dietary supplements, but ..
…the children have convinced me that creatine will make me stronger, but not live longer. They don’t want that.
I got this huge container from Amazon for $43 — click here.
Contrary to the P.R., the taste is awful. I’m persevering for now. But I’m not buying Prevagen, the much-advertised memory “enhancer.
Biggest find of the month
This stuff works on toilets and on tennis shirts. It’s amazing. Click here.
Favorites
I’m off on a Backroads biking trip with my son to the Baltics
Here are some of the books I’m hoping to plow through:
Bad Company got a great review in the NYTimes. Click here.
I’m actually posting this blog from the Vilnius Airport. Vilnius is in Lithuania. We’re going biking in Lithuania, Latvia and Estonia.
There are all members of NATO and all border on Russia.
Michael assures me that the electric assisted bicycle I’m renting from Backroads can outrun any Russian tank.
P.S. I fixed the software on this blog. Click on one of my “click here.” You can then hit the top browser back button to return to the blog.
— Harry Newton
