As we noted above, on a tactical basis, we believe a correction or consolidation is becoming visible on the horizon. The market’s rise into year-end has been strong, and as good as the big-picture backdrop is, no market goes up in a straight line forever.
When the pullback or consolidation period arrives, we think tactical investors would be wise to buy the tech-related themes noted above. Cross-currents and political developments are also presenting some other near- and medium-term opportunities. These include rebounds in sectors and industries severely affected by the pandemic, such as travel and leisure, but also themes outside the U.S. We’ve noted several recently.
Japan, India, South Korea
We are bullish on Japan, which may be breaking out of a multi-decade doldrums and is rich in high-tech manufacturing expertise; India, where reforms have set the country up to take advantage of the realignment of supply chains in the wake of the U.S./China conflict; and South Korea, which combines elements of both.
Gold and Bitcoin
We are long-term bulls on gold in an era of seemingly permanent central bank intervention. We also believe that bitcoin is reaching a psychological tipping point, and is beginning to claim a portion of the capital that would once have flowed solely into gold as an expression of skepticism about governments’ fiscal and monetary policies. We believe that digital assets may split between monetary functions, with bitcoin serving as a store of value, and other digital assets serving as units of account and media of exchange, including central bank digital currencies, which are being very actively discussed. While we believe bitcoin is a long-term hold, and believe it presents a strong risk-reward profile, we would be buyers on weakness.
Thanks for listening; we welcome your calls and questions.
