white mountain weekly by pinecone macro may 3rd, 2018 · my pal kieran aka the klendathu capitalist...
TRANSCRIPT
WHITE MOUNTAIN WEEKLY BY PINECONE MACRO MAY 3RD, 2018
www.pineconemacro.com @pineconemacro [email protected] 1
Welcome to King Dollar week. What a ride in FX this week with the
dollar on performance enhancing drugs. After a few probing trades trying to capture a dollar rally and taking small losses this year, I
was able to capture this move, so it was a great week. This week I am going to cover uranium stocks, which I am literally tempted to
put all of my money in, I feel so strongly about it. Don’t worry, I will only put half of my money in one basket but this market is setting
up to create a lot of wealth. We will also hit a 1967 newspaper and look at an article about inflation from the great Roger Babson. And
of course, we will take a look at some pine knowledge, this week inspired by the latest episode of Billions.
If you watch Billions, you saw the gift given to Taylor Mason, with a
plant that had a Fibonacci sequence in it. As I was watching I knew I had to share the Fibonacci numbers built into the pinecone.
WHITE MOUNTAIN WEEKLY BY PINECONE MACRO MAY 3RD, 2018
www.pineconemacro.com @pineconemacro [email protected] 2
I could write a twenty page report about uranium but too many smart people have said too many smart things about uranium for me to do that. Instead I am going to compile some of my favorite resources on the industry. If you are not invested in uranium, do not know the story, or are skeptical – do yourself a favor and consume all I have compiled. The uranium train is about to leave the station. The Macro Tourist, Kevin Muir wrote an outstanding piece on uranium late last year that is well worth a read. Click on the picture to read it.
My pal Kieran aka the Klendathu Capitalist also wrote a great piece on uranium in late 2016. Click and read:
WHITE MOUNTAIN WEEKLY BY PINECONE MACRO MAY 3RD, 2018
www.pineconemacro.com @pineconemacro [email protected] 3
Another great resource is Mike Alkin’s podcast. Mike has done the
homework on uranium and is great at presenting the bull case. He recently had Adam Rodman (brilliant Dallas hedge fund manager) on
to chat about uranium and it was a great show. Check it out here
Speaking of Adam, he has an outstanding piece up on Real Vision Television. If you are a subscriber click this:
If not, check out this snippet on YouTube…then subscribe and
watch it because it is a steal at $180 per year.
WHITE MOUNTAIN WEEKLY BY PINECONE MACRO MAY 3RD, 2018
www.pineconemacro.com @pineconemacro [email protected] 4
If still interested, follow @quakes99 on twitter – he has a treasure
trove compiled on his feed.
Next I am just going to throw a couple slides at you from this great presentation from the Uranium Participation Corp. They always have
a great up to date presentation on their website. If you do not know, $U is a publicly traded company with actual exposure to uranium.
The rest of the presentation is an outstanding snapshot of the bull case – which frankly makes itself – it does not need a hype man – it
is just math…but read the entire thing.
WHITE MOUNTAIN WEEKLY BY PINECONE MACRO MAY 3RD, 2018
www.pineconemacro.com @pineconemacro [email protected] 5
Lastly, a few charts for you:
URA (miners ETF)
CCJ (largest miner)
WHITE MOUNTAIN WEEKLY BY PINECONE MACRO MAY 3RD, 2018
www.pineconemacro.com @pineconemacro [email protected] 6
UUUU (my favorite miner)
So what is the downside? Well, I have been bullish for a couple years and I have done nothing but lose money. The timing of this thing is
tricky and despite my hyperbole, no investment is ever a sure thing. Smarter investors than me have waited for a real breakout, I have
just been slowly accumulating and taking losses for a couple of years. With that said, I have never been more confident that this will
be perhaps the best trade of my life. The big risk is and will always be another nuclear disaster. If we got another major incident, all
bets are off and this industry will be in huge trouble. If you are not familiar with the uranium market and the investment case, I
sincerely hope you read through the material I provided and checked out the great interviews. If you are already a frustrated bull like
myself, I say it is time to add some more deep out of the money lottery tickets.
Next up, Roger Babson on inflation in 1967.
WHITE MOUNTAIN WEEKLY BY PINECONE MACRO MAY 3RD, 2018
www.pineconemacro.com @pineconemacro [email protected] 7
Arcadia Tribune April 23rd, 1967
WHITE MOUNTAIN WEEKLY BY PINECONE MACRO MAY 3RD, 2018
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I know that is tough to read, but I wanted to highlight a something
he mentioned in the article. If you are not familiar, Mr. Babson was well known for calling the 1929 crash amongst other things. Mark
Yusko had a great profile of him in one of his quarterly letters that is a great read. First I want to repost a chart from Julian Brigden I
shared in a recent letter for some perspective.
As you can see inflation popped in 1965 but was headed back down
in 1966 when the Fed eased and the govt ran a large deficit. Babson had this to say about this episode in real time. “Those who have
been wondering “where inflation went” may not have to wonder long. The outpouring of funds by the banking system and by
WHITE MOUNTAIN WEEKLY BY PINECONE MACRO MAY 3RD, 2018
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government action will soon be matched by perhaps the biggest budget deficit since WWII. As much as $15 billion, and maybe even $20 billion, will be the annual rate of federal spending deficit by a year from today. If this proves accurate – and we think it is not far from the mark – inflation will be on everyone’s lips again by spring 1968.” Take another look at the chart – he was right.
In my studies of inflation it is clear that budget deficits once played a major role in inflation. This is something that has been more or
less forgotten. As we currently embark on a $1.2 trillion deficit with a healthy labor market and a growing economy with the velocity of
money up 3 quarters in a row – it is worth considering if deficits can once again help drive inflation. We shall see.
“If you want to improve, be content to be thought foolish and stupid.”
― Epictetus
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Disclosure: There is risk in trading markets. Pinecone Macro is not an investment advisor. My letters are based upon information gathered from various sources and believed to be reliable, but are not guaranteed as to accuracy and completeness. The information in this letter is not intended to be, and shall not constitute, an offer to sell or a solicitation of an offer to buy any security or investment product or service. The ideas and trades I share are my own and are for informational and educational purposes only and should not be construed as investment advice. Accordingly, you should not rely solely on the information in making any investment. You should always check with your licensed financial advisor to determine the suitability of any investments.