Straight to your inbox from Keith himself!

*Trusted by tens of thousands of savvy investors and traders around the world every day

☕ Divorce the drama, marry the story

Jan 28, 2025

Good morning! 👋

The markets are trying to gain some footing after yesterday’s follies.

Good!

Like many, I’d just as soon avoid the drama, but I’ve been doing this long enough that I know it happens from time to time and for a variety of reasons that often have nothing to do with the markets themselves.

For instance…

The “Fat Finger Flash Crash” on May 6th, 2010 wiped out $1T in a matter of minutes when a single trading error hit the system. Algos amplified the situation, causing traders to dump stocks in a frenzy.
The “Brexit Panic” of June 24, 2016, when markets tanked following the UK’s vote to leave the EU. Total knee-jerk nonsense.
The “Trade War Tantrum” when a single Trump Tweet about more tariffs on China sent the Dow down 767 points. Traders sold first, thought later.
“Greece is doomed” on August 3, 2020 when fears that Greek banks would drag the entire eurozone under caused the Dow to drop a gut-wrenching 1,000 points intraday. Rebounders who waded in made bank.

My point is this.

The markets love a good crisis, and professional traders love to separate the weak money from stocks they want to own when they get one.

Investors who stay calm and focused – which I repeatedly encourage – tend to end up laughing all the way to the bank especially if they’re focused on worldclass companies making “must have” products and services like those we talk about regularly.

Divorce the drama, marry the story!

Here's my playbook.

1 – DeepSeek? More like Deep Leak

Forget about Nvidia for a moment.

If you used DeepSeek - and millions did - you just helped China pull off the biggest intelligence coup in history.

Think, people!

China now has access to your user data—hardware, software, third-party linkages—the whole shebang. More importantly, they’ve mapped the backdoors, including servers, cloud infrastructure, etc.

Beyond that, Beijing’s just gathered detailed behavioral data: usage patterns, preferences, and even geolocation, IP addresses, and device identifiers. The result? A complete “map” of the U.S. data structure, including the technical characteristics of every device that so much as touched it.

Social networks are just the tip of the iceberg.

Beijing now has the means to target anything of strategic interest—intellectual property, personal data, and more.

And what might they do with that?

Here’s a short list off the top of my head:

Espionage: Targeting government officials, scientists, and corporate executives to extract sensitive information.
Disinformation campaigns: Exploiting user preferences and vulnerabilities with fake data, misleading narratives, and microtargeted propaganda to polarize public opinion.
Economic attacks: Disrupting key industries, competitors, and political opponents.
Tech advantage: Using the data to accelerate China’s own technological development, likely including a direct pipeline into projects like Stargate.
Military compromise: Anyone in the military who logged in is now potentially at risk.

Cybersecurity investing just became a top priority.

Again.

My fave, btw, has returned ~530.80% over the past 5 years versus the S&P 500 which turned in a respectable 82.43% over the same time period.

I hope I’m smart enough to buy more. Seems to me that LEAPs call options could be a solid move, too.

Hmmm.

Point is… I know which companies I’m buying. Hopefully, you do too. If not and you’d like some help, you know where to find me.

2 – Lockheed fell short, of what?!!

Lockheed reported Q4 earnings this morning and the stock is down on a decrease in Q4 sales along with profit guidance that “fell short.” (Read)

Of what??!!

Take a look around the world and tell me with a straight face that everybody wants to sing Kumbaya around the firepit.

Not gonna happen anytime soon, unfortunately.

Weakness is an opportunity.

War, terrorism and ugliness remain growth industries, unfortunately.

I recommend investors own a very select list of defense contractors, all of which are focused on next generation weapons systems and have high degrees of institutional ownership.

Defense is a long-cycle investment, so it makes no sense to fall all over earnings projections every 90 days. 🤷🏻‍

3 – Boeing still a bug in search of a windshield

Boeing posted a $3.86 billion loss in Q4 2024 and an annual loss of $11.83 billion, the largest since 2020 and marking the sixth consecutive annual loss. (Read)

CEO Kelly Ortberg outlined a recovery strategy focusing on stabilizing production, addressing cultural and operational challenges, and investing in core businesses.

We’ve heard that before.

Boeing is still a bug in search of a windshield. If it were not so deeply intertwined with the military, I'd be tempted to short it for all it's worth.

Anecdotally, I just flew back from Italy... Airbus on the way out and Boeing on the way back... the Airbus is much better equipment, more fuel efficient, better quieter cabins, fly by wire, faster to upgrade and update.

Not a surprise that the A320neo family outsells the 737Max (better range, fuel efficiency and flexibility etc).

Trade Idea: Several years ago, I suggested that investors buy Airbus and consider simultaneously shorting/avoiding Boeing, something known as a “pairs” trade. Since then, Airbus has returned 41.30% while Boeing has dropped -9.84%. Now, I think the trade is about played out. So, it may be time to reverse… meaning go long Boeing and short Airbus. I’d feel better about the idea if Boeing were at $150 a share but still, hmmm. 🤔

4 – The ultimate midlife crisis: Microsoft wants to buy TikTok

President Donald Trump announced that Microsoft is in discussions to acquire TikTok (again). (Read)

Yep, this is the second time Microsoft has been linked to a TikTok acquisition, following unsuccessful negotiations in 2020.

I can imagine why Microsoft is interested.

TikTok is a treasure trove of user behavior, trends, and engagement insights that could supercharge Microsoft’s AI and advertising ambitions. Plus, frankly, TikTok’s global reach could give Microsoft the social clout it desperately craves—finally making them cool.

I can take it or leave it.

Betting on Microsoft to buy TikTok is like betting on your grandma to become a Fortnite champion.

Anybody buying TikTok is going to get enough baggage that an airline carousel would blush not to mention privacy concerns, regulatory scrutiny and geopolitical tensions. Microsoft doesn’t exactly have a great track record with consumer stuff either… RIP Mixer, Zune and dang near every social media app the company has ever touched.

Still, it may happen.

And I’ll be taking a hard look at whether or not I still want to hold Microsoft if it does.

5 - ChatGPT Gov 🤦‍

OpenAI has launched ‘ChatGPT Gov’ a platform designed specifically for U.S. government agencies. (Read)

Oh my.

What could possibly go wrong—besides everything—when AI starts suggesting nuclear launch codes as “creative solutions” or filing FOIA requests on itself?

And if you thought the DMV was bad, just wait until bureaucrats start arguing with ChatGPT over which forms to misfile or how to redefine “urgent.”

Just what we needed: red tape meets rogue AI.

It’s the bureaucratic apocalypse we’ve all been waiting for.