Market Meltup Begins; Old Order Fades (TSLA)

 

The $64,000 question is ‘are you ready’?

 

Tough one, eh?

 

Changes are coming, that’s for sure – big changes – and you can feel them. But what exactly to expect?

 

No one really knows.

 

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So how can anyone be ready for what’s to come?

 

The short answer is, they can’t.

 

But perhaps knowing exactly what’s going to happen is less important than knowing the shape of things to come.

 

That, certainly, is discernible – at least as far as we can tell.

 

And it looks like this –

 

  • First, you can confidently expect one final market meltup, complete with the requisite blowoff quaking and lotion-squirting madness that sucks in all investors – the professionals as well as ma and pa. It will carry far higher and longer than most imagine and will lay waste to all traditional measures of equity valuation.

 

  • What we are about to witness is, in fact, the end of a financial and investment regime that has existed for more than a century, the outgrowth of a market system that has its roots far deeper in the western tradition and that will be replaced by heaven-knows-what in the next decade. [When there’s time to pontificate and hypothesize more, we’ll do that. Meantime, the system is on its way out.]

 

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  • We expect that after the blowoff top is reached and the inevitable descent ensues, it, too, will carry further than most expect and will ultimately mark the greatest episode of wealth destruction in the history of the planet.

 

  • In some measure, then, it’s fair to say that we’re in the midst of the replacement of the western tradition itself. How this will play out is not easy to discern, but, again, the outlines are clear. The western world is being inundated with literally millions of refugees from the developing and third world, many of whom are willing to assume the customs and traditions of the west, and a great many of whom are not. This is happening on a greater scale in Europe than the U.S., but at this stage there is no stopping the momentum. It will continue until there’s a new animal created altogether, neither the America we knew, nor the old world of the refugees who are coming.

 

  • And that will create conflict.

 

  • We expect the financial rupture, coupled with the relocation of tens of millions of new souls into unfamiliar surroundings, will bring with it a near total loss of faith in the current political regime, as well. Native born Americans will decry the loss of a lifestyle they grew up with and cherished, and the new arrivals one they were expecting to assume. Both will find fault with the political system and will seek a more radical alternative.

 

Disintegration and its Consequences

 

A loss of faith is not something that’s easily replaced. Fear and suspicion are most often the benefactors when great historical tides turn and vacuums in the civil order are created.

 

The procuring of weapons becomes an advantageous proposition and their use an inevitability.

 

Hoarding of essentials follows and, of course, shortages as supply lines are disrupted and travel itself becomes less of a certainty.

 

The good news is that essential bonds – like those between family members and neighbors – are forged even stronger, and a return to the values of thrift and principled ethical behavior become a necessity. Where these values are not adopted, where they’re prevented from flourishing, only chaos ensues. Communal life is torn asunder and poverty, like a marauder, descends …

 

Action Now

  • Over the years, we’ve underlined the need to acquire by legal means a weapon and ammunition enough to defend your home and property from those who would attempt to damage or steal from you.
  • We’ve stressed the advantages of gold coins – U.K. sovereigns being our favorite – as an important means of barter or payment in a time of emergency.
  • We’ve encouraged you to have a back-up stock of gasoline for your transport needs.
  • And we have stressed the benefits of growing your own food in a vegetable patch or garden of whatever size, either next to your home, or, if possible, at a location beyond the paved turbulence of the metropolis – a place where you might even till yourself toward self-sufficiency.

 

We called it the four G’s – Guns, Gold, Gas and Grub – and we’re recommending you use the coming months to acquire for yourself all of these items.

 

This is the market and the future we face, and appropriate wealth building measures today are crucial for navigating the new order that will confront all of us.

 

To that end, consider the following chart.

 

It’s the NASDAQ Composite for the last six months, and it clearly shows that the midsummer swoon is far behind us.

 

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The panic that gripped markets in August, that chopped almost a thousand points off the NASDAQ, has very quickly gone the way of the dodo. We’re less than 2% from former highs and well above all the salient moving averages, which are themselves also rising.

 

This, dear friends, is entirely bullish action. And we bring it to you to highlight a few points, the first of which is the strength of the NASDAQ itself.

 

The Composite index is comprised of many of the hottest stocks on Wall Street. Just like the dot.com bubble days of 2000 with P/E ratios in the hundreds, today, too, the big tech names are dominating. The valuations haven’t yet reached the levels they did fifteen years ago, but we’ll get there. As a group, they still appear somewhat muted.

 

Focus on the Momentum Plays!

 

From our vantage point there’s nothing left to look at on the ‘value’ side of the ledger anymore – not because there are no legitimate value plays left, but because the market simply doesn’t care about them. Everyone is chasing the latest sexy-to-own stock and to hell with the numbers. There’s nothing left at this stage but crass bleacher fanaticism. So if the crowd wants Facebook, buy Facebook. If they’re in love with Google, don’t go searching for alternatives.

 

We say today’s winner-to-be is Tesla Motors (NASDAQ:TSLA), the world’s most overhyped vehicle manufacturer, a stock with almost nothing to offer from the fundamental side, but an interesting chart, and a great fan following.

 

Call it investing by ‘LIKES’, because that’s what we’re doing. No shame. Just money. Here’s the chart –

 

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With a couple of new hires under their belt and a mediocre earnings report the stock leaped higher last night by ten percent. It now sits at $230, and we say, climb aboard, friends.

 

We’re using a ‘synthetic long’ strategy. The details go like this –

 

[mepr-rule id=”994″ ifallowed=”hide”][mepr-unauthorized-message][/mepr-rule]

[mepr-rule id=”203″ ifallowed=”show” description=”wall_street_elite_members_only”]

Wall Street Elite recommends you consider buying a TSLA March 230 CALL for $23.60 and selling a TSLA March 230 PUT for $21.65. Your debit for the trade is $1.95.

[/mepr-rule]
[mepr-rule id=”988″ ifallowed=”show” description=”executive_lounge_members_only”]

Wall Street Elite recommends you consider buying a TSLA March 230 CALL for $23.60 and selling a TSLA March 230 PUT for $21.65. Your debit for the trade is $1.95.

[/mepr-rule]

With kind regards,

 

Hugh L. O’Haynew, Senior Analyst

See what people are saying...

  1. Tom Anderson

    Thank you for your intermediate and long term views – I can’t tell you how much they resonate with me. I know you tend to like ‘contrary opinion’ to validate your views but there is none from this old retired guy.
    Appreciate being kept posted. Problem is my IRA is all in near worthless gold shares (long story) and therefore trading capital is limited.
    Thanks,
    Tom

  2. Kirk Miller

    As a serious exotic energy developer, I mildly follow Tesla. There are many used Tesla S sedans for sale in California. Interesting. Buyers have found out that a drive over 250 miles is a pain in the ass. Also, consumer reports rates it “unacceptable.” I will buy an actual Tesla S when the price crashes. When I install a battery at 10% of the weight of the factory battery, and have an 800 mile range, then I will have a dynamite car. As for the stock, that is for speculators.

  3. geo

    How are you going to buy a loaf of bread with a gold coin? Small bills will be useful. Everyone accepts them. No one will know the value of gold. It will be virtually useless. Everyone thinks in terms of dollars. If it’s November and your crops are not coming in until summer, how can you depend on that for food? Can any of us really survive if the power grid goes down for months?
    I am totally dependent on electricity, except for a propane grill and a natural gas stove that does not require electricity to operate. Storing gasoline can be very dangerous. How much are you going to store? Where? Hopefully not in your house. One stray bullet might light you up real good.

  4. Jesper

    I’m not sure when you have been touting UK sovereigns. You’re full of shit. But I still love you.

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