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Rip Van Winkle And Escape Velocity
You could have slept through the first seven months of the year and you'd never know anything happened judging by major US benchmarks.
The S&P closed positive for 2020 on Monday and the Nasdaq 100 hit a fresh record high. "What pandemic?", asks Rip Van Winkle, whose portfolio consists solely of large-cap US equities. Call it a "bubble" or a summer "melt-up" or whatever you like, just as long as you call those who said a re-test of the March lows was imminent, wrong.
If you were wondering w
Instead of seeing it as a “defensive” play, there’s another way to look at equity investors’ love for U.S. (and Chinese) big-cap tech: it’s a tacit acknowldgement that COVD is accelerating myriad social and economic trends, and one of the winners in that evolution is going to be tech, of all kinds, but especially mega-cap tech. The only thing that changes that is if U.S. lawmakers/regulators work up the nerve to apply existing anti-trust laws to the likes of Apple, Alphabet, Amazon, Microsoft, etc. They won’t, and those companies will continue to dominate and eliminate their competition.
Although you’ve expounded on these ideas in previous articles, I think this one provides the most succinct synopsis of why big cap tech is defensive under current conditions and also essential. A classic HR piece de resistance.
H-Man, do you remember when you had that smoke and bought some mutual funds when the world was ending. We are there again. Back then we could go to the Bahamas, not so today.