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☕ Google’s in deep kimchee, Apple not so much

Mar 11, 2024

Good morning! 👋

All three indices have paused after hitting record highs last week.

Excellent!

The markets require buying and selling to work normally so the fact that traders have stepped back is a good thing because it lays the groundwork for higher prices ahead.

Tactically speaking, everything depends on the inflation reading tomorrow.

If it’s hot, the selling could continue because traders will interpret that as a sign the Fed will keep rates higher longer.
If it’s cool, the markets could find some footing quickly because traders will interpret that as a sign the Fed may be more inclined to hold rates steady or cut sooner.

Longer term, there are still waaaaaay more ups than downs so keep things in perspective.

Here’s my playbook.

1 – NVDA to $1,000 - missed it by that much!

Nearly a year ago, I predicted NVDA would hit $700 then, when that happened, $1,000 a share.

I was wrong.

NVDA hit a peak of $974 Friday, then fell.

Missed it by “that much” as the old saying goes. 🤦‍♂️

What’s next?

That depends on whether or not traders are done with the FOMO crowd, a remark I shared with the venerable Stuart Varney ahead of today’s opening bell. (Watch)

There certainly seems to be a bid developing – meaning buyers are bargain hunting.

Keep in mind...

NVDA’s returned 281.12% over the past 12 months
Forward revenue growth may be 70% - 100% this year
EPS growth may to 450% into 2025

I bought a skosh more this morning.

2 – Google’s in deep kimchee, Apple not so much

I’ve made no bones about it for quite some time now.

Google's in trouble.

The company depends on advertising and search engine results. It botched AI and can’t seem to catch up. I think the company’s entire business model is at risk.

People say the same thing about Apple but do not connect the dots

Apple has been working hard on AI behind the scenes and, I submit, may well have used the EV car project as a smokescreen that would allow Team Cook to fly under the radar. (Watch)

I reviewed quite a bit of data over the weekend and came away more convinced than ever Apple is going to have another “iPhone moment” at its upcoming developer conference in June.

Keith’s Quick Tip: Successful investing isn’t about buying hot stocks like people think. It’s about buying world class companies making “must have” products and services when seemingly nobody else will. Like Apple. Upgrade to Paid

3 - Bitcoin: $100k may be a self-fulfilling prophecy

Awesome development given that a) the UK says it’ll open the door to crypto exchange-traded products (Read) and b) former President Donald Trump said he won’t crack down if elected again. (Read)

I think $100k per coin may be a self-fulfilling prophecy at this point.

Still, I’d rather own my favorite bank, but that’s just me.

MyPOV: Every investment has risks but not all risks are worth the investment, a lesson I learned a long time ago.

4 – 10 areas where it takes longest to sell houses

Many people fancy a move for one reason or another, including yours truly. But the problem is that US housing markets are all over the map when it comes to the length of time it takes to sell your home.

All but 2 of the top 10 slowest selling metropolitan markets are in Sun Belt Cities – 3 are in Texas. (Read)

Hmmm.

Austin, Texas
McAllen, Texas
Poughkeepsie, N.Y.
San Antonio, Texas
New Orleans, La.
Jacksonville, Fla.
Cape Coral, Fla.
Colorado Springs, Colo.
Deltona, Fla.
New York, N.Y.

5 – The car did it... or, maybe not

Here it comes.

We’ve talked several times about how the legal system isn’t ready for much of the technology being foisted upon us including self-driving vehicles.

Seems we were on to something.

There's a new legal challenge being mounted against Tesla’s “blame the driver defense” (Read)

At issue is the fact that Tesla may not have done research on how fast a driver could take back control if needed. And, on a related note, whether Tesla understood that drivers wouldn’t likely use the Autopilot system as directed or couldn’t.

What catches my attention is a comment Musk made in 2016 when he noted that “autopilot accidents are far more likely for expert users. It is not the neophytes.”

That makes all kinds of sense to me.

I see it when I’m out on the road motorcycling.

People are becoming so cocooned by cars that do everything, they’re becoming increasingly careless, more distracted, and less likely to react appropriately in emergency situations. Studies show talking on cell phones can induce a similar level of impairment to so-called drunk driving. Email, same.

This isn’t just a Tesla issue, although the media will probably do a fine job of portraying it that way.

It’s a landmark “attack” legally speaking, and it could open the floodgates.

I’ll be watching very closely.

Keith’s Investing Tip: Breakthrough technology is not without its challenges. The key will be making enough progress that stupid people using it in ways that rational people wouldn’t don’t become the tail that wags the dog. But, then again, the legal system has deteriorated to a game of technicalities, so the notion of personal responsibility seems to be a long-lost concept.