Remain Cautious As The Great Bubble Unwind Continues

Well, I’d said I’d send out a note from my wannabe staycation if things got crazy and here it is. It’s just relentless selling out there. Have I mentioned that we are most definitely on the OTHER side of what was a 13-year long Bubble-Blowing Bull Market? Indeed.

I remain cautious and defensive overall, although I did nibble a tiny bit of RKLB today. I’ve been warning forever that even though it’s the best publicly-traded space company out there that it’s valuation has remained quite stretched. Even today it’s still trading with a $2.2 billion market cap which is almost 10x next year’s sales estimates. This is a long-term, five or ten year time horizon on this name, as I’ve always said.

This crashing spec stock cycle probably still isn’t quite over, but we are getting closer. We are going to get to the point where we’ll want to start being more aggressive about buying some new names and scaling more aggressively with full 1/3-sized tranches in existing names in the next few days or weeks if this kind of panicky selling action continues.

I’m keeping most of my shorts in the hedge fund, including those in crypto like MSTR, SI and COIN steady with maybe a little cover here and there on days like today when they crash. I’ll use a few in-the-money puts dated out a week or two if they do another spike.

There will be a time to open up the portfolio to let it run again but it’s probably not here just yet. Easy does it along the way.