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Unka Ronald strikes again and investors are gonna love it

Oct 24, 2023

Good morning! 👋

Nice to see some green on the screen in the early going on the heels of some strong earnings reports and stabilizing Treasury yields.

I’m not sure it’ll last, but I’m not particularly concerned about that, frankly.

Why?

Simple.

Chaos creates opportunity.

People often react in fear when I say that, but that’s your emotions talking.

History shows very clearly that chaos is a catalyst for innovation, fresh solutions, and new paths to success. Not for nothing, but TV, nylon, and the electric guitar were all developed during the Great Depression.

Investors who stayed in the game did very, very well.

Here’s my playbook.

GM strikes out: Dividend investors best be leery

Many investors are hyper-focused on the UAW strike, but as is often the case, they’re not thinking clearly about the bigger picture.

GM beat Q3 expectations but pulled previously announced guidance because of mounting UAW strike costs. The company also pulled near-term EV targets on—big surprise—lower-than-expected demand. (Read)

MyPOV: Millions of income-oriented investors could be in for a nasty surprise. I’ve got to imagine this translates into trouble for Ford and Stellantis, too. Talk about handing Musk the keys to the castle—WOW!

A few well-placed putskies on any/all of the American car makers could be just the ticket. Meanwhile, owning Tesla is a forgone conclusion.

Coca-Cola beats and the crowd goes wild

Coca-Cola knocked it out of the park with a “double,” meaning the company beat on the top and bottom line. Revenue came in at $11.91B versus $11.44B expected while EPS came in at $0.74 versus $0.69 expected. (Read)

Makes perfect sense.

The company raised prices by nearly 10% YoY; management obviously thinks this’ll continue because they raised guidance, too.

MyPOV: Investors continue to play around the edges, but companies like Coca-Cola that are very focused on what they do best are the investments to own right now. Consumers must have what they make—or, as is the case here, simply can’t resist.

I actually prefer another stock with even better management, though. Assuming my research pays off, chances are good you’ll see it in the November One Bar Ahead®. Upgrade to Paid

Xreal’s gunning for El Zucko and Apple Vision

Chinese augmented-reality firm Xreal just launched two new AR glasses with the thinly veiled goal of taking on Meta and Apple. (Read)

AR tech is important and still not understood by most investors.

The initial foray is going to be gaming and streaming content, but the real prize will be commercialization a few years from now. AR glasses will allow users to have large-screen experiences or even immersive experiences when they’re wearing ‘em.

Xreal’s Air 2 and Air 2 Pro glasses are super intriguing because they’re flicker free, low blue light, and TÜV-certified for eye comfort. They will apparently ship here in the US in November, according to The Verge.

Unfortunately, Xreal isn’t public yet.

Hmmm.

Why isn’t gold $5,000 an ounce?

That’s a good question with a logical answer.

Much of the speculative energy that used to be in gold has been diverted to Bitcoin and other cryptos in recent years. Lately, it’s also been going straight into 90-day T-bills, which just crossed 5% and which, as I noted Monday, even I’m buying. (Watch)

The rules of money are being rewritten.

To be clear, I think every investor should own some gold, but not because they think it’ll go to a gazillion dollars an ounce. You want to own gold because doing so helps you play offense even when thinking defensively is required.

Free fries for the rest of the year

Talk about a genius move!

McDonald’s is offering free fries for the rest of the year to customers using contactless payment and ordering through McDonald’s mobile app. Apparently, the “Free Fries Friday” deal is limited to once a week, and the only size available is medium. You’ve also got to be spending at least $1 on other items and be opted into the company’s rewards program. (Read)

I think consumers will go for it in a big way.

Wall Street, of course, will worry about the prospect of a loss-leader, but the real move here is new-customer acquisition. I can only imagine what every name on the list is worth.

Now, pass the catsup… Taco Tuesdays may never be the same!