Investing for a transformation in Energy and the Monetary System.
I believe we are in an investing period similar to the mid 1970’s.
This was a time period where both an energy and monetary transformation were necessary for the US to come out of stagnant growth. (Think, Oil and Gold).
I’ve been on the record making this claim.
Here are two cases back in 8/20/2020 and 1/29/2021
This historic “parallel lense” has been a profitable trade to date.
It justified an early allocation into commodities and a divestment from interest rate sensitive securities before there was a consensus view of inflation expectations realized.
Going forward, I’m not confident US policy makers agree with how or why we need radical changes.
The “Back to the Future” trade in energy and the banking system are uncomfortable but I believe necessary to build the US back to growth.
I would like to see this transformation take place in Uranium (Energy) and Cryptocurrencies (Monetary).
But I’m not always so lucky.
Policy makers seem to be more interested in the “Green New Deal” (wind & solar) and Modern Monetary Policy (printing free money).
However this plays out, we intend to continue to be on the side of profitable ventures.
This means continuing to invest in value stocks while adding two new allocations to companies best positioned in the energy and banking space.
A respected friend of mine managing institutional money agrees with me. Below is a picture of the winning investments during the 1970s. This is the only piece of research he has printed and kept over the last couple of years (there’s even a coffee stain right in the middle of the chart).
From the chart it’s obvious that long skew was towards Value, Energy, and Real Estate.
Credit: Josh Young.
Don’t underestimate America and don’t forget the best overall returns tend to be doled out one teaspoon at a time over a long period.
(Hint: Bond Math doesn’t look good)
Bottom Line: As opportunities present themselves, I will keep you as investors informed in line with this broader theme.
P.S.
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Best,
Darin Tuttle, CFA
Founder & Chief Investment Officer
Tuttle Ventures, LLC
