In recent weeks we’ve been looking to the future. The future of industry, the future of money, the future of Australia and the world.
We read the papers and watch the news, like most people. But we also take a far more cynical approach to what we see and read. We know that most mainstream media outlets have an agenda.
We also know that most mainstream outlets thrive on fear. Fear sells. Fear brings in viewers. And viewers bring in advertising revenues. Sure, from time to time you’ll get a good news report, or sport and weather. But we all know that fear sells.
And it’s an easy time to sell fear. It might be ‘tensions in the middle east’. Or the impending war between the US, North Korea and Japan. Maybe it’s Britain and the EU wanting nothing to do with each other. Or it could be the homophobic nature of Australian parliament.
Either way, fear is everywhere. And the media laps it up. If all you did was focus on this fear, you’d be forgiven for wanting to lock the doors, latch the windows, pull the shutters and bunker down in the basement until it all passes.
Except this geopolitical nonsense isn’t going to pass. Not any time soon at least. In fact, cast your mind back as far as you can. Can you remember a time of peace? Can you remember a time when there weren’t ‘tensions’ in some region? Can you remember a time when things were just so good that it was hard to focus on anything negative?
The opportunities are endless
The good news is that there’s plenty to be optimistic about.
Now, we’re often accused of being a ‘perma-bull’. That means we always look at markets and see the upside.
That’s almost true. Yes, we do see opportunity in markets. But for good reason. And we’ll explain why in a moment. But yes, we do know that at some point in the future things might get worse — a lot worse.
We can see that government addiction to debt cannot last forever. We know there’s only so high the US can push their debt ceiling before the glass house shatters.
It’s obvious there’s a global debt addiction, both in government and households. And we’re pretty certain at some point it’s going to cause a mother of all crises. However, we don’t think that time is coming just yet. We think there’s still a good runway of 10, maybe 20 years to go.
That means plenty of time to make some serious money. And in our view there are two massive opportunities we see for people to build wealth. One is more conventional, one definitely unconventional.
The unconventional opportunity in our view is cryptocurrencies. We think this could be the best long-term opportunity to build wealth in the history of money. Even if the crisis of all crises comes in 10 years or 20 years — or even in one year — cryptocurrency will thrive.
In our view holding some wealth in cryptocurrency long term is a smart, if highly risky, move. All our research indicates it’s the best hedge against global financial calamity.
But today it’s not just crypto we want to talk about. There are other more traditional opportunities to make money. And again, in our research there’s no better ‘conventional’ way to build wealth than stocks.
In good times and bad you can make money investing in stocks. Now while we say stocks are ‘conventional’, they’re still risky. In fact it’s the stocks with the most potential that are the riskiest. And even though there may be a big ol’ crisis in another decade or two, that still leaves you a huge opportunity to profit from stocks.
Money flow from the big to the small
Acceding to the Australian Financial Review,
‘Australia Inc. says it will spend $101.8 billion on capex in the current financial year, 17.6 per cent more than was anticipated three months ago. It represents the biggest increase in expected investment spending in seven years, according to Australian Bureau of Statistics data published on Thursday.’
What that means is Aussie businesses are preparing to funnel money back into growth. Instead of paying out money in the form of dividends, they’re ploughing it back in to foster innovation, development and growth.
For example Santos [ASX:STO] is upping investment to US$750 million. Singtel Optus [ASX:SGT] is going to spend $1 billion on network improvements. Telstra [ASX:TLS] is going to spend more than $15 billion to find areas of growth.
You see, for a blue chip to grow and expand isn’t as easy as you might think. It’s not always possible to develop an entire new service, product or project in-house. When that money is pumped back into the growth of the company, it often finds its way to other, smaller companies that can assist in the growth.
For example, if Optus wants to expand their network, much of the hardware that’s needed to achieve that doesn’t come from Optus. It comes from smaller companies.
Or perhaps a company like Santos wants to explore new areas for drilling. And maybe there’s a junior miner that’s got exactly the kind of project they’re after. It’s often easier to develop a joint venture or even just acquire that smaller company than to try and do the exploration alone.
That means that, with huge Aussie blue chips ready to invest back into business, smaller Aussie business could profit massively. With billions ready to flow back into investment, we think this could be the start of a massive surge for small-cap stocks.
We could see massive opportunity in areas such as FinTech, communications hardware, speciality metals miners, and breakthrough biotech and medical therapy companies.
It’s a good time to invest in stocks as big money prepares to flow. And when the big money comes from blue chips and flows down into small-caps, it’s the small-cap stocks you’ll want to own.
Editor, Secret Crypto Network