Live From Vegas, Day 2

When the cameras go up... An eye on higher rates and 2026... The 'national distraction' for investors... What you can bet from this election... Alliance Day on tap... Wine and guitar grooves...

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When the cameras go up...

One of my favorite sights at our annual Stansberry Research conference is when the cameras go up in the crowd, when people take out their smartphone to snap a photo of the slide someone is showing on the big screen behind them...

Often, they are looking to capture a stock ticker that the speaker is sharing. Folks want to make sure they have the details of the recommendation they're hearing about from one of our editors or invited guests... so they can review the pick and possibly buy that stock.

But other times, people take pictures of what I (Corey McLaughlin) will describe as "big ideas" they are obviously interested in. We've seen a few of these instances through the first two days of our conference here at the Aria Resort & Casino in Las Vegas...

Like when Rich Checkan, the president and chief operating officer of Asset Strategies International, delivered his bullish case for gold yesterday to attendees in the room and folks watching via our Livestream Pass. (We'll share a little more on this farther down in today's Digest and expand further on Rich's thoughts later this week.)

Or when Crypto Capital editor Eric Wade today revealed a blockchain-related recommendation – also sent to his subscribers today – tied to an industry you might not expect: farming. "Blockchain does do something," Eric explained. "It allows you to share real-world data."

The cameras went up, too, when Ten Stock Trader editor Greg Diamond gave his take on where interest rates are likely to go over the next year or so. We'll share more about that right now...

An eye on higher interest rates – and 2026...

Yesterday, Greg delivered his latest outlook, rooted in "time and price" technical analysis and a study of cycles. As regular readers know, he has used this approach to make prescient calls before – like when he called the top for stocks in early 2022 and the bottom that same October.

Maybe the most interesting discussion Greg offered yesterday was about a 50-year cycle in interest rates...

In short, Greg anticipates a potential repeat of the path of interest rates in the 1970s. In that decade, rates rose with inflation, then fell, then rose again higher. If this is the case again, we're currently in the stage between a fall in the inflation rate in the mid-'70s and the new highs that followed.

As we've discussed here, longer-term yields moving higher after the Federal Reserve cut rates last month was a telling signal about market expectations for inflation moving ahead...

And as we've written before and as Greg pointed out, the path of inflation (measured by the consumer price index) from 2017 through today matches almost identically with that of 1970 through 1976.

Greg also showed another pattern... The 10-year Treasury yield has already broken out of a downtrend "channel" that began in the mid-1980s, after yields and inflation hit a top at the start of the decade...

From a technical perspective, this is compelling stuff... higher highs and higher lows in rates within an uptrend that has lasted since 2020.

And then Greg discussed more about his "time and price" analysis and cycles, which suggests to him a major point for U.S. stocks by 2026 – specifically a "big high and big decline." The trigger, he said, could be a reacceleration of high(er) inflation...

Inflation is not likely to drop... and is likely to put pressure on stocks in late 2025 and into 2026.

If you ask me, Greg's outlook through the end of 2025, at least, aligns with the bullish outlook we wrote about here yesterday from True Wealth and True Wealth Systems editor Brett Eversole. To Brett, we're now in part of an ongoing "secular" or longer-term bull market.

That means we'd have stocks moving higher and interest rates moving higher (because inflation is reaccelerating) – until they both don't. The scenario sounds reasonable as we think about the market outlook for next year.

Meanwhile, ignore this 'national distraction'...

That was the message from Pete Carmasino, chief market strategist of our corporate affiliate, Chaikin Analytics. Pete's presentation was, of course, about the presidential election.

Until November 5 – and possibly even longer – the election will dominate the news cycle. And that's even true for financial news. Pete highlights one mistake most investors make around this time... trying to pick investments based on the election's winner.

Pete showed that predicting sectors to benefit is tough. Under both the Barack Obama and Donald Trump administrations, consumer discretionary and technology stocks came out on top, despite the two presidents' big differences on policy.

And under Trump, the Energy Select Sector SPDR Fund (XLE) was the worst-performing sector, despite his pro-domestic energy stance. On the other hand, while President Joe Biden may be viewed as "anti" U.S. energy, XLE has been the best-performing sector during his term.

As Pete showed, there's no consistent pattern for sector performance based on who wins the election. He told attendees about a better system...

It's called the Chaikin Power Gauge. Pete said his team's proprietary tool – which combines technical analysis with strong fundamentals – is the simplest way to stay focused on "price trends" and not the "party trends."

For example, Pete highlighted three different sector funds that have surged higher after the Power Gauge turned "bullish" over the past 12 months. It's not a one-off. We've seen Pete and Chaikin Analytics founder Marc Chaikin do this kind of thing repeatedly.

While the election result may be consequential, Pete's big point was investors shouldn't try to get ahead of the results or use the eventual winner to shape their investing decisions. Indeed, that's a take we've heard a few times here this week already...

You can bet on this, though...

This take from Dan Ferris – editor of Extreme Value and The Ferris Report and my Stansberry Investor Hour co-host – sums it up succinctly.

On stage yesterday, Dan rattled off a list of the presidents going back decades and proclaimed: "They're all idiots... and it doesn't matter."

Rich Checkan made a similar point right after Dan's presentation, talking about how neither Kamala Harris nor Trump has proposed anything during their campaigns for the White House that could lower the national debt and stop devaluing the U.S. dollar.

There is "no plan for them to get the dollar right," Checkan said. And that's a big part of the reason why he thinks gold – which has been making new all-time highs this year and now trades above $2,700 per ounce – is only at the start of a major bull run.

A China discussion...

This morning, Brendan Ahern, the chief investment officer of KraneShares, sat down for a fascinating "fireside" chat with a pair of former U.S. ambassadors...

Terry Branstad, the former Iowa governor and U.S. ambassador to China from 2017 to 2020 under Trump, and David Adelman, a former U.S. ambassador to Singapore who now works with KraneShares, joined Brendan on stage.

Those of you who read our two-part "China Explainer" a few weeks ago (here and here) – or listened to or watched our entire Stansberry Investor Hour interview with Brendan – have a good background about the subject matter discussed: "How Investors Should Think About U.S.-China Relations."

The three delved deeper...

Branstad offered his impressions of Chinese President Xi Jinping, whom Branstad has known since the 1980s after he made a trip to Iowa as a "thin, shy young man," he said. "Obviously things have changed."

He described Xi as a "very astute politician" who recognized a problem with corruption in the Chinese Communist Party and has cracked down on it. Branstad also said that Xi has responded to calls from people for cleaner air and is attuned to boosting the income of Chinese citizens in rural areas.

Adelman offered his impressions of the Chinese and Asian economies – like Singapore, which invests more money in China than any other country in the world. "Everyone in Asia wants stability," Adelman said. He says that you often don't hear this idea in mainstream news, but "leaders in Beijing and Washington are hearing that."

Along these lines, he said he thinks the idea of the Chinese military invading Taiwan is close to zero. "The Western media likes to get everybody worked up," Adelman said, saying the U.S. response to Russia (and efforts to cut it off from the Western banking system) upon its invasion of Ukraine is a "cautionary tale" for China...

This is the only way the war in Europe has been constructive...

It's sending a message to Xi Jinping that he doesn't want to find himself in the situation that [Russian President Vladimir Putin] is in today, which is increasingly isolated with a country that has continued its downward trend.

Both Adelman and Branstad said the U.S. and Chinese economies – the two largest in the world – are too interdependent for their governments not to allow business among them. China is the largest purchaser of American agriculture, and China relies on "American purchasing power and know-how, and the potential for American direct investment."

How that business gets done is another matter, though. For instance, the trio explored the idea of tariffs.

Branstad said Trump is probably using his tariff proposals as a bargaining chip to bring China and others to the table about existing trade deals and policy. In the meantime, Adelman said, any tariffs wouldn't be a good idea in the medium and long term and would likely lead to inflation.

Dave Barry leaves the room laughing...

"I am not an expert," Dave Barry began, "on anything. Do not take investment advice from me unless you want to end up selling your blood plasma to get home."

We weren't sure what to expect to hear from the Pulitzer Prize-winning humor columnist when he took the stage today. Neither was he, apparently. But over what was essentially a 40-minute standup routine, Barry had the room laughing – a lot. He started...

When I was asked to do this, I didn't know anything about the Stansberry conference... I did a little poking around on the Internet and you know what I found out? There is a lot of pornography on the Internet. You should check it out.

And next...

I understand this is a conference of people who are investors and you're looking for safe things to do, profitable things to do with your money... I'm curious – you're in Las Vegas. Where do you go for health conferences? Chernobyl?

Barry is 77 – "the new 74," he quipped – and has two grandkids. He likened being asked to play on the floor with them to being asked to visit North Korea: "You don't go there on the spur of the moment." He continued...

It's mostly bad getting old. There are some good things. The biggest positive for me is the sense of perspective that I have...

Like when I hear people say, "If we don't radically alter our lifestyles, this planet will be uninhabitable in 25 years." If you're a young person, that sounds serious... But if you're me, you think, "Twenty-five years? I can live with that.'"

He offered his platform for the U.S. presidency and closed with a bizarre story about the Oregon Highway Patrol blowing up a beached whale with dynamite, which he assured the crowd was true and could be found on YouTube. (It can, here.)

Attendees buzzed when he was finished with the performance.

Barry, who won a Pulitzer while with the Miami Herald in 1988, has a new novel out called Swamp Story, full of oddballs with a plot based in South Florida. After his routine, he signed free copies of the book – with a long line to get his signature on the pages.

Tomorrow is Alliance Day...

Our editors will be on stage most of the day sharing favorite stock picks, exclusively for our Alliance members in attendance and watching on our livestream.

We'll also sit and watch one of our favorite sessions: "Bull, Bear, or B.S." In that, our Director of Research Matt Weinschenk will fire hot topics at our editors and get their takes on if they are bullish or bearish on the idea, or if it's complete nonsense worth ignoring...

Also tomorrow, Dan and I are scheduled to interview Rick Perry – the former Texas governor and former secretary of energy under Trump – right after Perry delivers his presentation on the future of energy in America.

AI, wine, and guitar riffs...

In the meantime, we're busy. I'm going to meet up with Dan to record an interview with AI expert and former OpenAI executive Zack Kass, who presented this afternoon, for a future episode of the Investor Hour...

Tonight, Retirement Millionaire editor and Eifrig Cellars winery founder Dr. David "Doc" Eifrig is hosting a wine tasting. That'll be followed by a "Stansberry Social" where subscribers can chat with editors... and Dan will play the guitar to provide music.

Cheers to that, and we'll be back with more reports from Vegas in tomorrow's Digest.

New 52-week highs (as of 10/21/24): Apple (AAPL), Agnico Eagle Mines (AEM), Brookfield Renewable Corp. (BEPC), Alpha Architect 1-3 Month Box Fund (BOXX), BWX Technologies (BWXT), CyberArk Software (CYBR), Expedia (EXPE), Comfort Systems USA (FIX), VanEck Gold Miners Fund (GDX), iShares U.S. Aerospace & Defense Fund (ITA), Kellanova (K), Lockheed Martin (LMT), Nvidia (NVDA), Palo Alto Networks (PANW), Sprott Physical Gold Trust (PHYS), Sprott Physical Silver Trust (PSLV), Construction Partners (ROAD), Seabridge Gold (SA), Sprouts Farmers Market (SFM), Skeena Resources (SKE), iShares Silver Trust (SLV), Texas Pacific Land (TPL), ProShares Ultra Gold (UGL), Wheaton Precious Metals (WPM), and the short position in SolarEdge Technologies (SEDG).

In today's mailbag, feedback on yesterday's edition, which included Michael Lewis' comments at our conference yesterday on jailed FTX founder Sam Bankman-Fried... Do you have a comment or question? As always, e-mail us at feedback@stansberryresearch.com.

"I have to wonder if Mr. Lewis would be so sympathetic of SBF if HIS own lifetime savings were among those SBF swindled... I'd bet not." – Subscriber Robert J.

All the best,

Corey McLaughlin with Nick Koziol
October 22, 2024
Las Vegas, Nevada