iBankCoin
18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
23,541 Blog Posts

Stuck Between Growth and a Hard Place

Contemplating macro moves, I’m having a hard time accepting dividend paying stocks are a worthwhile venture. Value guys are endlessly jabbering about them and many are at 52 week highs. But let’s be honest, risk free returns are over 5% now. Barely any of the really interesting divvy plays are yielding more. Why bother?

On the other hand we have growth and the overvalued nature of it, placing investors in between growth and a hard place. Should we just continue to buy up growth and ignore value, hoping the gravy train continues? Just by saying that I sound like a bearshitting skeptic. Anyone who is against the orthodoxy of $NVDA and $MSFT is simply wrong.

And what about cryptos? Everyone trips over themselves to describe to me how great $BTC is but on nearly every time horizon, $SOL does better.

Looking for “value” growth might land you in odd places, such as China. On the surface level, China should be good. It’s the biggest and fastest economy in the world. Everyone says it’s the future. Yet, all of their stocks suck. I suppose the fact it is a communist state might have something to do with it. But they really don’t act communist, given the profits the companies retain. The stocks aren’t very reliable and the risks associated with holding Chinese stocks, given the tenuous nature of US relations, is palpable.

This leads me back to $NVDA and the semis and the crowded AI trade, with all of its bells and whistles. Aside from the occasional rally in basic materials, which is extremely fickle, the semis have been the most consistent area of the market to make money. There are others, such as industrials, which lead all sectors in sales growth TTM. There are an array of industrial stocks crushing and most are under the radar. But are you going to make 50% per year on those?

We are nearly midway through 2024 and gains have been tapered. Both the NASDAQ and SPY are up around 11%, Russell +4%. If you think about the 100 year return of 8% and then the +15% annual return the market has provided us with since 2009, you can see how fucking spoiled rotten we are and how making 20% per year on investments isn’t all that attractive anymore.

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