This Week on Trends with Friends (June 23rd, 2024)
Welcome Friends,
Here’s a curated collection of posts shared this week on Trends with Friends.
Friday, Howard Lindzon shared an update and a brief history of the degenerate economy.
The degenerate economy continues to ramp… the arms dealers (Nvidia/semiconductors, Apple, Google, brokerages, crypto, social networks) have embedded it and Interest rates don’t matter to it…
When anyone asks me how all this started, I go back to the early days of the internet and Yahoo, specifically Yahoo Sports and Finance.
Us early degenerates were in the Yahoo message boards. Both those Yahoo verticals have survived and thrived even today.
JC Parets posted a chart of the Australian Dollar vs. Japanese Yen closing at its highest level since 2007, asking the question — What’s This Chart Telling Us?
He writes,
This chart really stood out to me this week.
We just saw the Australian Dollar vs the Japanese Yen close at the highest levels since 2007.
So why do investors care about the Aussie/Yen cross?
Because look how it trades with commodities…
You’ve seen Cocoa futures screaming higher.
Gold is hitting new all-time highs.
And Dr. Copper is now on the verge of a historic breakout.
The Aussie/Yen ripping higher is not a bad thing for commodities.
It’s also not necessarily a bad thing for equities either.
Michael Parekh’s AI Weekly Summary is stocked with gems. Parekh reviews Nvidia’s massive market cap, Safe Superintelligence, Anthropic’s AI update and more.
It’s a must read for AI enthusiasts.
Tadas Viskanta curated podcast links Cultivating Gratitude. Here’s an overview.
Ted Merz shares his view on urban modernization in his recent piece, Harlem in the Movies. Merz mentions,
What’s funny about the picture and how it’s used in the TV series is that if you pulled the camera back, you would notice this:
Barber Shop is next to a fancy French bakery called Le Petit Parisien that puts out tables and umbrellas on the sidewalk.
The juxtaposition of the two is more representative of the neighborhood.
But that may not be what tourists or Hollywood filmmakers think people want.
Charlie Bilello looks at US Large Cap Domination in his latest Chart of the Day. Charlie comments,
The biggest US companies have been dominating the equity market for well over a decade. As a result, the outperformance of US large caps (S&P 500) over small caps (Russell 2000) is now at its most extreme level since November 24, 1999.
What happened in the 7 years following the 1999 extreme? Reversion to the mean. Small caps would outperform large caps by a wide margin, with the Russell 2000 gaining 90% versus an 11% gain for the S&P 500.
In this week’s Lumida Ledger, Ram Ahluwalia reviews the strong Dollar, natural gas, a rotation into energy, Brazil and more.
Here’s the money quote,
Utilities like Constellation Energy, VRT, and Talen have run-up due to the massive energy needs of data centers.
But, utilities themselves need energy as an input.
Those inputs range from oil, coal, natural gas and wind / renewables.
Wind and renewables are coming online too slow, and are unreliable (e.g., cloud cover, etc.). The next 3 to 5 years require a transitional energy source.
We believe that will be Liquid Natural Gas.
Trends With No Friends sifts through the noise and discovers stocks above $1B market cap with high relative strength and low social following.
The publication shares 52-Week Highs and Lows sorted by followers on Stocktwits.
Why is high relative strength and low social following important?
Stocks that are outperforming tend to continue to outperform. Stocks that have a low social following are, by definition, undiscovered by the crowd. Stocks that have both Relative Strength and Low Social Following can really outperform as more investors discover them.
This week, Trends with No Friends featured…
Teladoc ($TDOC), La-Z-Boy ($LZB), FTAI Aviation ($FTAI), Camtek ($CAMT), Veeco Instruments ($VECO), SolarEdge ($SEDG) and more.
And in case you missed it… Howard Lindzon, Phil Pearlman and JC Parets are joined by Ryan Detrick, Chief Market Strategist at Carson Group. The team talks about small caps, sector rotation, private markets, inflation, rate cuts and more on the latest episode of Trends with Friends. Tune in today.
If you share insights on the market and would like to contribute to Trends with Friends, send us an email.
