Carty Capital Management
Carty Capital Management

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The Edge of Investing

We went from all news was bad to then learn that North Korea was way different than previously and repeatedly feared.  In another example of mistaken identity - just yesterday, after the healthcare stocks have been absolutely shellacked due to fears about a government pushback on pricing, the President had his talk on drug prices.  The result?  once again, not even remotely as bad as positioned by the media for months.  The other result?  Healthcare stocks of all stripes rallied.

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Lost Signal

The Q1 earnings seasons is going down in the record books for more than a few reasons.  The obvious are clear - records, almost everywhere - from top line to bottom and all cash flows in between.  Let's face it - the US economy has NEVER made more, produced more or profited more than it does now.  

 

In fact, it's not even close.  

 

The tax law changes are still filtering into the benefit columns for many companies.  Those who made Q4 2017 assumptions in their remarks last quarter, almost all saw increased benefits 90 days later.  I suspect we will still see a trickling in of additional benefits as the next quarter or two unfolds.  

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Cloudy Horizon

The massive earnings flow that continues to build a much large base, stacked under an expanding level of revenues as well - is being completely misperceived at this time.  

The short-term interpretation of these events is being "clouded" by a completely misguided fear of interest rates.  This is understandable given a vast portion of today's active trading audience has never been in an environment where rates are rising instead of being flat-lined on the screen.

 

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Mike Williams
Choke Hold

It's the long-term currents we need to invest upon - not the short-term waves which will assuredly always roll ashore to block the horizon - just as they are now, causing doubt in the minds of millions once again.

Those waves are the noise too many will likely continue to be lost in...and the reason the long-term game is so hard to win based on fearful activities.

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InvestingMike Williams
On the Ropes

Chatter is washing over the crowd again (in waves) that we are witnessing the last legs of the bull market.  Talk from experts telling us that the ratcheting up of rates will collapse our economy, self-destruct the bond market and plunge us all into the dark ages again.

 And if that does not do it, well - the new perceived risks of "war" can always crush any good feelings too. 

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InvestingMike Williams
Problems

Know this as an investor:  The world which we see, experience and take part in each day exists almost entirely due to a string of decades of solved problems.  All that we see and benefit from today started out first as a problem, need or wish - looking for a solution.  

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InvestingMike Williams
Churn and Burn

While it is very, very early in the latest earnings parade - the data are strong and show the continued acceleration in revenues.  Why do I point that out?

Well, many may not recall - mainly because it was roughly 1,450 monsters or so ago - that for the first few years of the rally from 2009 lows, we were all told how radically bad it was "because the 'gains' were coming only from cost-cutting and not new revenues...."

Uh, right - well, that sure turned out to be a brilliant thing to focus upon. 

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Mike Williams
Transition Year

If you still feel queazy and scared about the ghosts of tech-bubbles past - know this:  you will miss a lot of what is coming due to unwarranted fears.  Tech will morph into something far larger than anything we have ever witnessed - all because of the avalanche of tech geeks headed our way:

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InvestingMike Williams
Relaxaholic

investing for the long-term, while successfully accumulating wealth, will indeed be one of the toughest games you will ever play.  It will at times be exciting - but often you will be humbled beyond belief.  At times it will elicit happiness but as often if not more, despair, angst and concern.  At times it will pull at every strand of your mental being - begging you to end the pain by selling and just "keeping your money in the bank where it's safe...."

 

No more incorrect words have ever been thought by the way....

 

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InvestingMike Williams
The Price

The acceptance of the required pain along the way to building wealth and meeting goals.

 

For too long, a market that goes down in the short run has been reported as a problem.  It has been expressed in this manner for decades:  and it's all wrong. 

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InvestingMike Williams
War? No Wait

The point?  Thank real-time media for all this newfound knowledge.  The world is basically as nasty as it always has been in some places.  Sad really - but true nonetheless.  The difference today from 25 years ago is that cameras and real-time wireless connections with satellite feeds put us all on the frontline within seconds.  

It leads one to believe - falsely so - that the world is getting uglier.   

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InvestingMike Williams
Whiplash

Anyone hoping we might start Q2 more quietly than we ended Q1 on the volatility front was rudely awakened to a nasty start and then a bit of a dead elephant bounce.

Heck, thousands of points have already been covered and we are only three days into the quarter.  Welcome to the real world. 

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InvestingMike Williams
When You Come Back

They will come back at higher prices, when the coast is "clear", when the future looks "bright", when the experts "feel better", when they themselves feel "more confident about what is ahead..." as though there will be some point in time ahead on the pathway we all face where the future will be crystal clear.

Indeed, it is somewhat funny at times the jokes the mind can play on us if we are not careful.  

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InvestingMike Williams
Lights Out

You know that feeling...that pit in your gut where you are sure it's going to get a lot worse - right? 

 

Yep, we all get it - and the latest data points are clear.  Here is the deal - it may get worse - and then it gets better. 

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InvestingMike Williams
TKO

It is obvious now by market reactions, that investors were seemingly "taken by surprise" by Trump’s proposed tariffs on selected Chinese goods.  Maybe many forgot that he publicly listed his trade policies during a campaign speech on June 28, 2016.

Now as covered already, you may or may not like our President, but you have to give him credit for delivering on his promises - whether you like them or not. 

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InvestingMike Williams
In Plain Sight

Indeed, as much as the media wants to tell you how big and bad China is - their economy tanks far faster and farther than ours in this game - and they want no part of it.  I did kind of like the reference of going "to the WTO."  Sort of like, "I am going to tell the teacher if you take my pencil again."

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InvestingMike Williams
A Stinger

By the way, I got the license number - - of the double-trailer truck which drove over the market this week.  Sadly, it matches the one that got us a few weeks ago.  

"FEAR2018"...and wouldn't you know, it's a DC tag.  Ouch.

 

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InvestingMike Williams
Make No Mistake

Stretch your mind just a little bit and you will recognize that the world you “see” today is being dynamically defined by what you click on.  Think I am kidding?  Play a trick on yourself.  Go to say, a sporting goods place and look at a blue tent.  Click on it as though you want to buy it.  Then don’t buy it and go back to work.

Be assured that for the rest of the day – and multiple times over the next week – wherever you are “on the internet”, that blue tent will show up in ads – almost everywhere you look.

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InvestingMike Williams