Taking Apart The Markets in 2024 and Our Robotic Future in 2025 – Sunday Reads And Listens

Good morning everyone.

It is the last Sunday in 2024 and what a great year it was for people that liked to embrace risk.

I am a simple trend follower so I think the biggest trend that will continue through 2025 is technology that powers more long-term breakthroughs, while also powering short term trends in our culture like entertainment, speculation and degeneracy – the things that are an offshoot of all this new rapid deployment era of technology.

The year 2024 saw the complete barbell of the risk spectrum – thanks to technology and the USA culture – with people trading off 1 second memecoin charts (the edge of the ‘degenerate economy’) and moonshot investors from Silicon Valley moving into the White House. While our new bosses are in most ways the same as the old bosses, I am hopeful that curious and patient people are better than bankers and traders for a little while.

Here are the 1 year major averages in the stock market (charts from Koyfin.com):

The 10 year chart gives you a better picture about how technology has ruled the markets:

The TOP 9 largest companies (I call them the ‘Nifty Nine’) in the world are technology stocks and make up 36 percent of the S&P:

In the 60’s and 70’s America was in love with the ‘Nifty Fifty’, so the ‘Nifty Nine’ should not be a major surprise to anyone because these 9 companies are actiually financial planets of growth, cash, moats, political power, talent, creativity and customer addiction.

The bear case is easy as we head into 2024. These companies are too big, they suffer from a law of large numbers as they try to grow and interest rates are high. Let’s throw in energy problems, global conflicts and the speculation is entertainment crowd having way too much fun. The bear case remains a pretty good wall of worry for the markets to climb. It will be something on page 9 today that will tip the markets , if we do tip in 2025.

For years, investors have debated whether share buybacks, even dividends are good or bad and Apple may be the company that settles this once and for all as it trades at all time highs and a forward PE that is greater than Nvidia’s:

In the meantime, doom and gloom and bear chart porn are at all-time highs about as we head into 2025. Here is a fresh piece making the rounds:

One thing most Americans are underinvested in today, which will probably be solved by the ‘Nifty Nine’ and new leaders pushing their way into and up the $QQQ is robots.

There was a lot of chatter and excitement about robots in the second half of 2022 and I think it is underestimated how big robotics will be for the next decade of technology stock winners. Take a look at Intuitive Surgical ($ISRG which is a stock in the $QQQ) which I imagine 99 out of 100 investors have still never heard of this $200 billion company.

While America has spent trillions buying weapons to instill fear, inflict pain and damage and protect itself around the world, two of the best performing companies in the S&P this year were about a new form of defense, protecting Americans at home on our own streets using technology and data. They are Palantir (software and data) and $AXON (Hardware-Taser and body cameras and software). One look at today’s line of $AXON products and you can see the many possibilities of improved safety (including robots) on our own streets

It is an exciting time for the optimists as we head into 2025.

Thanks for reading and following along in 2024.