Sunday Arete Newsletter

We are getting helicopter money! 🚁🚁🚁

What a wild week of of trading! To begin with,the political uncertainty is over.No matter what side of the isle you are. It’s over and that is good for the markets as a whole. The markets hate uncertainty more then anything. We saw massive inflows into the indexes this week based upon the final chapter coming to an end. Next is what does the future administration and congress do that will affect the stock market. Simply we do not know exactly what will happen. We do know the following , Biden’s Administration has stated over the weekend they are looking for $2-$3 Trillion dollar bill to extend aid to citizens and businesses as well as infrastructure spending. This amount of money will affect several areas. Common stocks usually rise in RISING inflationary periods, Commodities stocks will rally as prices on everything from soybeans to gold rises as an inflationary hedge, The dollar will sell down more as more are issued,The US 10 year will go higher. Essentially we are going to get what is referred to as “Helicopter Money”. In the newsletter last week I mentioned Goldman sacs and JP Morgan estimates on a stimulus package. Those numbers will be revised upward. That will lead to higher GDP. Higher GDP per 1% leads to 7% EPS $SPY growth. You can see where I am going with this. I was fortunate to trade in the 1999-2000 era. The stock market moves we are witnessing now are nothing compared to what happened back then. The only comparable stock is $TSLA. This can go on for a long time and will end with a bust like every other cycle. We just need to trade price. That will make sure we are not there when the music stops..

Lets get to Indexes.

Lets get to our stock ideas !

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2021 off to a Great start !