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When it comes to what’s interesting out there right now, I’m an unashamed bull on Bitcoin. At the current price, you’re paying about $6bn for the entire Bitcoin network. That makes it the approximate equivalent of the world’s 2,000th largest stock – in other words, it’s really not seen as a big deal. There are distressed mining stocks that have the same valuation as the entire Bitcoin network. But what would you rather buy – a potentially world-changing opportunity, or an expensive hole in the ground? I’m not suggesting for a moment that you should put 100% of your wealth in Bitcoin – to an extent it’s still a solution looking for a problem. But I think that getting light exposure just now could pay off handsomely in the long run.
Turning more mainstream, the US dollar is clearly a major factor affecting markets, and I suspect that dollar strength will continue. The US economy is stronger than most of the rest of the world, and they’re probably raising interest rates for the right reasons – mainly that they’re too low in the first place. They’re at least able to consider “normalising” at a time when most others are unable to do so. That suggests that pressure on emerging markets will continue – as former US Treasury Secretary John Connally once put it: “It’s our dollar and your problem”. Despite its strong run, the dollar, fundamentally, is not overvalued – it’s come from a position of being cheap in 2007 to something close to fair value now – so it could go on for a while longer. I also think the yen is undervalued right now.
Finally, there’s the question of Brexit. I believe that we should leave the EU. That said, there’s no question that the pound will inevitably see some weakness over the referendum, as will certain areas of the stockmarket. From that point of view, those who want to prepare for any uncertainty on that front should look at the big globally exposed companies in the FTSE 100 – excluding energy and mining, obviously – which could turn into something of a safe haven.
Charlie Morris is the editor of the Atlas Pulse newsletter, AtlasPulse.com.
Turning more mainstream, the US dollar is clearly a major factor affecting markets, and I suspect that dollar strength will continue. The US economy is stronger than most of the rest of the world, and they’re probably raising interest rates for the right reasons – mainly that they’re too low in the first place. They’re at least able to consider “normalising” at a time when most others are unable to do so. That suggests that pressure on emerging markets will continue – as former US Treasury Secretary John Connally once put it: “It’s our dollar and your problem”. Despite its strong run, the dollar, fundamentally, is not overvalued – it’s come from a position of being cheap in 2007 to something close to fair value now – so it could go on for a while longer. I also think the yen is undervalued right now.
Finally, there’s the question of Brexit. I believe that we should leave the EU. That said, there’s no question that the pound will inevitably see some weakness over the referendum, as will certain areas of the stockmarket. From that point of view, those who want to prepare for any uncertainty on that front should look at the big globally exposed companies in the FTSE 100 – excluding energy and mining, obviously – which could turn into something of a safe haven.
Charlie Morris is the editor of the Atlas Pulse newsletter, AtlasPulse.com.