The market has had a blistering run since Nov. 8 – with the Dow Jones Industrial Average up 9% — but plenty of the “experts” on Wall Street are pessimistic about Donald Trump’s effect on tech stocks.
These folks believe that Trump’s tough trade stance will hurt tech because the big global players manufacture many of their products overseas.
“I would avoid [big tech stocks] in a big way,” DoubleLine Capital CEO Jeffrey Gundlach said a week after the election. “The basic fundamental underpinnings of [big tech stocks] disappeared one week ago today.”
Gundlach may be the “Bond King” – but he’s wrong here about tech stocks.
Technology will be the one sector of the economy you can count on for high growth in 2017.
That may sound hard to believe, because tech slightly lagged the broader stock market through the first 11.5 months of 2016. But that was largely because life sciences fizzled.
But tech stocks are going to resume their leadership position in 2017.
Therefore, if you’re one of the millions of Americans trying to put together enough money for a stress-free retirement, technology is where your focus should be.
In this wide-randing interview with Money Morning Executive Editor William Patalon III, I lay out my “case” for tech’s resurgence, talk about the surprising benefits incoming U.S. President Donald Trump will have on American innovators, and outline a strategy for maximizing high-tech profits in 2017.
We’ve been talking a lot about artificial intelligence (AI) over the past few weeks.
About how the big brains at Google’s DeepMind AI system say they may have developed a memory system they’re calling a “differentiable neural computer” (DNC) and possibly unlocked the path to truly intelligent deep learning.
About how many of FacebookMessenger’s 1 billion users are using AI-enhanced “chatbots” for their customer-service needs – chatbots that may soon be handling bill paying, shopping, delivery, and a range of other tasks.
Trump has said he plans to act more like a chairman of the board, while Vice President-elect Mike Pence and the Cabinet handle the nitty-gritty of government.
So maybe we should be talking about “Elaine Chao Stocks”…
After all, Trump’s pick for Secretary of Transportation will head up much of the president-elect’s $1 trillion infrastructure improvement plan.
But more importantly to our interests here, she’ll be in charge of regulating self-driving vehicle technology.
If Chao’s history as Deputy Secretary of Transportation under George H.W. Bush and Secretary of Labor under George W. Bush repeats itself, that’s good use, because she’s known for a light regulatory hand.
To us, that means public companies in the self-driving space are likely to see a big boost in share price over the next four years.
Especially the one we’re looking at today.
You can already find its “pre”-autonomous driving technology in many of the most prestigious nameplates.
Its technology is the force behind two of the most “public” driverless car tests over the past couple of years.
And its shares are primed to soar as much as 40% in the next year alone.
There’s a tech “play” out there that gives us access to just about everything: solar panels, data storage devices, tablets, smartphones, cars and trucks, and even high-definition TV sets.
But that’s just the beginning.
It also puts us in antibiotics… water purification systems… and even NASA spacecraft.
And I bet that most of you have a piece of this “Universal Tech Play” on you as we speak.
I’m talking about silver.
Most investors think of it as a precious metal – a way to store value.
But you’re not “most investors,” and you now know that silver – this Miracle Material – has a special set of properties you won’t find in other commodities. It’s an excellent electrical and thermal conductor; it provides a durable and smooth coating for many tech components that can’t have imperfections; and it has anti-microbial properties that help medical devices stay germ-free.
Washing machines, refrigerators, air conditioners, air purifiers, and vacuum cleaners all rely on silver nanoparticles to sterilize up to 650 types of bacteria.
And right now, another hot growth area is just starting to develop for silver – nanotechnology.
Engineers have begun tinkering with this metal, looking for ways to apply wafer-thin layers of silver to a range of industrial and medical products.
While silver prices have been weighed down by strong economic figures lately, this shouldn’t deter you long term. In fact, the best time to find great bargains in silver is before another price surge.
Rats have long been one of humanity’s worst enemies.
Flea-invested rats were carriers of the bubonic plague that killed between 75 million and 200 million Europeans in the mid-14th century.
Today, rats still carry and spread many diseases – some fatal – including hantavirus pulmonary syndrome, murine typhus, and rat-bite fever.
But I love rats – specifically, OmniRats.
These rodents – developed by biotech researchers – contain disease-fighting antibodies that are remarkably similar to the ones found in us humans. And those researchers believe they’ll be the key to dozens of successful drugs.
When it comes to mining – of both precious and strategic metals – most of the “low-hanging fruit” has been both discovered and mined out.
That’s even with the sophisticated power, equipment, and transportation technologies we discuss every week here.
And that leaves us with much lower grade deposits… at least on land.
One of the biggest tech advancements in recent years, however, has made those lower grade deposits – i.e., lower metal concentration per ton of rock – economic to mine. I’m talking about the ability to move, crush, and process massive amounts of rock from open-pit deposits.
If you have a question or issue with a recent purchase or experience – say, a broken toaster, mis-delivered pizza, or stinky hotel room – you have several options…
You can visit the customer service desk.
You can write a letter.
You can send an email.
You can call customer service.
You can chat with a bot.
You see, over the past year or so, thousands of “brands” – everything from soda companies to tropical resorts – have unleashed bots to handle some of their customer-service load.
With these bots, you type or say a question – and the bot responds. They work pretty well – I used one to cancel my cable service earlier this year… and didn’t realize it till later.
That may seem like a small change in the “How We Live” window of the Singularity Nexus – chatting with a bot instead of a call-center worker – but these chatbots wouldn’t exist if it weren’t a major Singularity Era technology.
Soon, all of our “intelligent” things will have some form of chat- or voice-bot – like Siri on your iPhone – interface.
All these chatbots need the right software and platform to be effective.
One company has already developed that software and platform.
Since this summer, this company has deployed dozens of dedicated AI servers to comb through all of the data it is getting from its chatbot platform.
And as it does so, that company’s AI system getting smarter and more precise with each passing month – and those brands are seeing success and more are signing up.
Today, I’ll show you why this company is one of the best ways to play AI and chatbots.
Not least of which because you could make profits of 107% with it between now and 2020.
At least that’s what every market analyst on Wall Street and cable says.
And they’ve got a point (well, three points).
First, there’s Donald Trump’s aggressive economic stimulus – including that $1 trillion infrastructure plan. Second, traders are moving their cash into a very attractive stock market. Third, the Fed will likely raise rates by the end of the year.
All three of these are bad for bonds – hence, the $1 trillion rout we saw over the past week or two.
There’s just one problem with this line of thinking. It misses the role bonds play for conservative investors, retirement funds, and other institutions who want the yield and plan to hold bonds for years.
And so, this market for fixed-income investments remains both active and huge – $40 trillion huge.
Why are we talking about the bond market? After all, we’re not going to start bypassing big tech winners in favor of bonds. Especially not now.