What I’m buying
But first,
. . a two-minute view from Canada.
And now . . I bought some puts in the last week. Trump appears to be ruining the economy. . . We could be in a stagflation from which it would be very difficult to recover. . . This is great for Putin — his wildest dream come true — but not for a stock market that, in the main, was selling at a very rich multiple of earnings on Inauguration Day. I fear it is not too late to purchase more puts on various market indices, but — don’t.
Or at least, think long and carefully before you act. You could lose your entire bet, even if the market continues to decline. The market may rebound, fall, or remain flat, before the puts expire worthless. Even if you “win”, your gain is fully taxable. I bought the majority of my stocks in a tax deferred retirement account where taxes were not a concern. The rest was placed in a taxable investment account to hedge against a large tax bill if I sold highly appreciated stock. Don’t buy stocks because they have dropped in value. I am a sucker of those stocks, but not all. . . TSLA
. Even though it is down to $224, from its high of $488 90 days ago, remember that in June, the price was $170. Why is it more valuable now that maybe 90% of those who are worried about climate change – Tesla’s biggest market – kind of dislike him? Why is Tesla worth more than 100x its trailing 12-month earnings, when the next year’s earnings could be even worse? It would need to fall by a further 80% to reach 20 times trailing 12-month earnings. (
Ford, by way of context, pays a 7.5% dividend and sells around 7 times its trailing 12-month earnings. Ford is not as overpriced as TSLA, but I’m not familiar enough with its prospects to decide whether or to buy. )
A few I do like here, all of which I’ve written about here more than once (use the search box to see):
CHRBUNITOPRTSQNSHYMC
ANIX
PRKR
CHRB is limited to the $25 upside it promises to pay next year, plus the very nice dividend you get in the meantime.
My UNIT guru thinks it will be $12 after their merger and that the merged company will then be bought out at an even higher price by one of the giants, like Verizon or AT&T.
The next three. The next three. As speculations go, the stock market could easily triple within the next two years. (Or not! )
The last two are swing-for-the-fences speculations.
For better or worse, I have lots of all of them.
This article was originally published on March 11th, 2024, on andrewtobias.com, syndicated with permission.
