Real Estate Outlook, Space, Crypto, Gold Coins And More
Here’s the transcript from this week’s Trading With Cody Live Q&A chat.
Q. Cody, is recession imminent for Europe and the US in the next few months?
A. 30-40% chance for the US, 60-70% for Europe.
Q. With home sales starting to show some signs of slowing in various markets, what’s your outlook on the real estate market for the rest of 2022? Stagnant or slower depending on geographic area? Any areas that you think might cool faster than others?
A. I’m bearish on real estate, as I’ve outline often for the last few months. I think the prices for houses are unaffordable for the purpose they’re supposed to serve (primary homes) for most people. There’s a bubble of AirBnB properties that people have bought several of and that’s probably going to hurt the unwinding of prices over the next year or five. Austin is the safest real estate area in the country probably.
Q. Cody, what’s your reasoning in thinking Austin is the safest real estate in the country? Mainly Tesla rated or other factors? Thanks.
A. Tesla, Apple, other giant tech companies and many startups are headed to Austin and I think Austin’s got years of growth and wealth-ification to go through, at least for those who make middle-range incomes and above(the poor will probably get poorer if SF is any indication) as it becomes a San Francisco meets Wall Street of the middle of the country.
Q. Cody, what’s your opinion of the USD/RUB seesaw? I imagine the powers that be believed the sanctions would have a much more devastating effect on their currency and help keep the existing system in place for the conceivable future. Do you think the rebound, has empowered more relevant countries to start the process of finding a more neutral transnational exchange method? Especially with the weaponization now of accounts that are easily blocked and sanctioned (ie, Canada truckers, US and Europe).
A. Fog of war. The risks of unintended and unforeseen consequences from sanctions, unconstitutional seizure of private citizens property (ie, yachts) are real and part of my continued cautiousness.
Q. Elon’s brilliance aside, I’m still unconvinced that he will have any actual effect on Twitter’s anti-free-speech/censoring policies, which has been and remains the main obstacle for the platform’s growth in my opinion. I mean, if you alienate half of the population it’s kind of ridiculous for an investment (as I’ve thought for years). Aside from something like an Edit button or other cosmetic changes, what do you think Doge-shill-man can really accomplish with his 9.2% stake?
A. The single biggest problem with Twitter has been that management has been on autopilot and the whole silly game of pretending they are doing something about misinformation while there’s still so much misinformation and propaganda and anger on any social media platform is…silly. I am pretty sure that Elon has plenty of guts to help force the company to take some risks that they’ve been scared to do so far and that Twitter’s policies will look a lot different, more transparent and open sourced than any other social media platform in five years.
Q. Cody, can you go through which space revolution stocks we should be focused on now? Other than SpaceX, I remember you recommending RKLB. Is RDW and BKSY off the radar for now?
A. That’s right. SpaceX is by far the best company in The Space Revolution. Rocket Lab is the best publicly-traded company. RDW and BKSY are small positions for me. In another two to three years we will have better and more companies to invest in on the stock markets.
Q. What is your opinion of Momentus (MNTS)?
A. Not a fan, I bought some puts on it in the hedge fund this week.
Q. Please consider my best wishes for Amaris, you and your family. Your advice is very valuable to all of us subscribing to your service. My question for today is, how to invest in SpaceX? I see a few articles when I google it, but could you please recommend one reliable way?
A. There is no easy way for a retail investor to get into SpaceX. If you have $250,000 to invest in SpaceX, maybe you can find some in the private markets with a large commission and carry fee (the broker who helps you get the SpaceX equity will keep a % of the profits at the end). If you have $1 million or more to invest in SpaceX you might be able to find a better deal. I put my hedge fund into SpaceX back before it became popular to do so and before its valuation tripled, but over time they’ve made it more expensive with higher commissions and carry fees to get into a “reliable” deal.
Q. What is your best guess for when Gensler’s Gang (aka the SEC) will begin sending out the ol’ “crypto regulation letters” we’re all waiting on? I’ve heard everything from a couple months (or sooner) to summer, or fall of this year to 2023.
A. Best guess, as it has been, is that the SEC will “ride to the rescue” AFTER thousands of the silly, fraudulent and stupid cryptos already go to zero.
Q. “Best guess, as it has been, is that the SEC will ride to the rescue AFTER thousands of the silly, fraudulent and stupid cryptos already go to zero.” After, eh? This seems a bit further down the road than how Gensler sounded in his chat earlier this week. Although, I do realize the gov’t does move in slow motion on a great many things, lol
A. He’s got to talk a big game.
Q. Is Facebook still the best choice for investing in the Metaverse? Would that be followed by Unity?
A. Yes, probably.
Q. For holding some gold, any preference for what variations to hold (big bars, smaller bars, mostly coins, some of each, etc)?
A. Mostly coins.
Q. Your recommendations and market timings have been a disaster for me since quite a while now. Can you please tell us about the performance of both your personal account and your hedge fund for the last 4 calendar years? I need some confirmation that it’s worthwhile, at least in the long run, to base my trading decisions on your recommendations.
A. I have been writing about what trades I make a lot longer than four years but I don’t track my own performance across my investments in the way you’re asking and I can’t promote my hedge fund’s performance in public. I think most of my subscribers will tell you that we have had a lot of outperformance over the years. Regardless, since February last year, this has been an incredibly tough market for the kind of investing that I have long done — finding Revolutionary technology companies and buying them early and/or when they’re cheap. At the time, I had recognized that the markets had bubbled and were likely topping out and that it was indeed going to be a very difficult market for my type of investing since it had gotten so crowded. I have tried my best to navigate these times and have tried to set us up to deal with this and we have definitely done much better than say, ARKK, has with their relentless bullishness even during this crash they’ve had, down nearly 70% since last February. I have been pretty cautious for the last year and that’s been the right thing to do. As I often write, there will be a time — maybe soon — when you once again see me step up and pound the table and get aggressive. More importantly, we are getting to the point now where some of the greatest investments for the next five years are just sitting out there in the midst of this tech spac crash. We are likely going to find a handful of 10-100 baggers in The Space Revolution, The AI Revolution and other new tech Revolutions if we put in the work. We have found many 10-100 baggers in the last two decades since I’ve been doing this professionally and I expect we will find more with our approach as this bubble/crash dynamic finishes cycling around again.
Q. Cody, thanks for your detailed answer. I have the feeling it’s going to be a quite different investing environment for a longer while.
A. It might come quicker than we think. Time and price and fundamentals will guide us.
Q. Cody, I’ve asked this before but when do you think you will be able to list an overview of our position with A cost basis? There’s been a lot of volatility in the markets and I think this will help a lot.
A. I have brought on a brilliant and experienced colleague to help make the Trading With Cody product better across the board with features like what you’re asking for. Give us a couple months.
Q. In case one is not able to watch it live next week, will there be a replay available of your “This will get worse before it gets better” event in NYC on Tuesday, April 12 at 3:30pm?
A. I’ll ask.
Q. Cody, I know they have wanted to for a long while, but might the rebound actually make it happen this time? Here is Zoltan Pozsar talking about Bretton woods 3. Very interesting interview
A. Thanks.
Ok folks, that’s a wrap. No chat next week, as I’ll be NYC. Be sure to register for the crypto event if you haven’t yet.
I leave you a shot of this adorable baby cow that was born on my ranch last week. We have quite a few more babies about to be born out here. So cute…
