 Good day fellow investors and welcome to the weekly stock market news recap where we discuss interesting news that improve our financial returns by lowering our risk and potentially increasing our returns. The topics for today are the negative sentiments surrounding Starbucks, there is a piece of real estate that went up 180 times in the last 40 years, the disruption in the energy, electrical vehicles, we discussed oil last time, we're going to shift towards energy and what's going on in the energy field, we're going to mention Bitcoin a little bit just for fun, we're going to mention how everybody is going on to the stock market to the upwards trend, there are no short people anymore, which is very interesting, Chinese stock market has rallied, which was logical because of the low valuation, digging to that, we'll see what's going on with the Fed and why everybody expects interest rates to be hiked and we'll finish with some food for thought with an obesity chart, interesting, let's start. So first investors are bitter about Starbucks, a recent study showed that most investors, most investment analysts are negative about the stock and that's why also the stock is at year lows, there is a link in the description where I discuss Starbucks as an investment, the price earnings ratio is now 28 and I think for a company that has a strong brand and huge growth potential is really cheap when compared to the market, for me a price earnings ratio of 28 is expensive but I really think Starbucks can beat the market in the next 5 to 10 years, so it's interesting how a stock that was the market darling for a long time, after a few earnings call that don't meet the high level of expectations analysts have, then the sentiment starts becoming negative and that's the time to invest in such a growth stock because the company is growing, is expanding at a healthy rate, when you're that big you cannot grow as you have been growing when you were small and that's what analysts don't see, however the stock is getting cheaper and cheaper because the earnings are getting better and it's getting more and more an interesting investment for those who want to be positioned in a globally growing brand, interesting, look at the video, look at the stock, now this is very interesting, I was reading the Wall Street Journal and they have mentioned that Park Avenue penthouse that was once a residence of the ambassador of the former republic of Yugoslavia will hit the market for the first time over 40 years, so the former country of Yugoslavia owned the building and since 1991 nobody lived in that building because the states that were formed after Yugoslavia collapsed didn't make a decision on how are they going to split, now after 27 years they have made the decision and it's extremely good for them that they didn't make a decision, you know why? because the price of the penthouse from 1975 till now increased 180 times, the selling price then was 100 000 for the flat and one buck for the furniture and now the asking price is 18 million, so 180 times increase in what are we 42 years, so that's something crazy and that shows in what kind of asset financial environment we are, stick to assets, have a hedge, stay away from money, money is losing value day by day even if it doesn't seem like that when you look at inflation indicator, so that's something to really keep in mind, in the next 50 years i bet you stocks without adjusting for inflation will also be higher, businesses, real estate everything will be much much higher because there is an inflation of money continually being printed in the world, i think it's 17 per year the amount of money that's printed in the world or has been during the last 10 years, that's crazy and that's unsustainable and you see the result, you see the result if you look, so 180 percent, so an increase of 180 times is crazy, however take advantage of that, think about taking loans with a fixed interest rate, we have discussed that also link in the description or something that you can take advantage of that, not the other way around that inflation takes advantage of you, be careful with that, going on to the disruption field in energy, look at this chart this is us electricity generation by fuel in all sectors in 2009 coal was used for 44 percent of an electricity generation now it's just 31 percent and it wasn't replaced by natural gas 23 percent then 32 percent now what's the reason behind this big of a difference prices as the price of something goes down in this case natural gas it is used more and more and such a shift 10 percent market share energy production share in less than eight years for me it's a huge disruption and let's see what will happen in the future look at this as we have seen everybody switched to natural gas because of lower costs this is the projection of cost of lithium ion batteries per kilowatt hour it is about to get half in the next 10 years up to 2025 if that happens then batteries will become interesting renewable energy will become interested and also that is going to half so if in the next seven eight ten years we see renewables storage of energy get much much cheaper then i think the projected market share for that source of energy will explode like it was the case for natural gas if we go back here to other sources it's not that important here it's not yet important but up to 2025 with the technological disruption that's going on with tesla all over the world with other companies i really think this chart can be much much different and there is nothing we can do about it well there is something we can do about it we can invest in the trend i have been constantly discussing copper prices so let's take a look at the copper chart copper has continued to go up there was a slow dip but now it's continuing to going up my projections are that in the long term copper prices to meet growing demand without any benefit from the electrical vehicle renewable trend coming in copper prices should balance out at 3.54 so we are still cheap i'd say when i say balance out it means that copper prices can go to five to six because copper is a cyclical it goes up when there is more demand than supply it is never it never stays in one place it already goes highly up or highly down so that's why i see copper prices at six at some point and a balance price of four so that's one way to invest and take advantage of what's going on however always think about the risks if there is now global recession in the next year two copper prices will go down to two so if you want to invest in a copper miner look first quartile cost miner low cost miner and low debt because those companies will survive anything even global recession just a quick look at the bitcoin it dipped when there was the issue with china and now it continues to go up i just want to give you some information to get a better picture of this the total cryptocurrency market now is 110 billion and when you say 110 billion that means that of course there are low volumes not everybody's jumping into the market because they still expect the market to grow nevertheless 110 billion of this market is nothing when you compare to how much currency there is and that's about 100 trillion does a thousand times more than what's the market cap of the bitcoin and that bitcoin is not even used in daily transactions so yes the bitcoin is very interesting i have made a video again link in the description where i discuss that the bitcoin can go to 100 000 but also to zero so be very aware of that and it's nice to look at it because passing five thousand is very interesting i'm happy if you own it i'm happy for when people make money even if i don't make part of that trend you can't be invested in anything and i wish you luck i wish it goes to 100 000 for all of you that are invested nevertheless be aware of the risks so let's see now what's going on with the stock market and why there are no more shorts this is a weekly survey by the national association of active investment managers that measures the position of the most skeptical money managers and in this case you can see that most of the skeptical money managers are also 100 percent long this hasn't been the case in the past but now everybody turned long everybody gave up capitulated the shorts have capitulated and everybody is long this means that this market has gone totally ballistic there is no fundamental no rationality it just goes up in the trend so my view is don't fight the trend for now don't short it if you want to sell if you are happy with how much money you have and you want to retire you want to sleep well sell if you still think you can ride the wave ride it but be careful because everybody is thinking the same and when everybody thinks the same then disaster is about to happen and on the way down the way down we have been seeing nine years of the way up the way down will be nine months and it will be a disaster terrible catastrophe be aware of that when you invest adding to that i have also discussed the buffet indicator the link is in the description below the buffet indicator that measures the stock market capitalization to gdp is getting close to the level where it was in the dot com bubble in the 1990s so be careful of that in the 1990s 1999 crazy stocks had crazy valuations and let me show you one stock that had a crazy valuation in the last two weeks helios and matison analytics a company that bought another company about some movie subscription business i don't understand i don't see them making money on that it's extremely risky however the stock price suddenly exposed from below five from a company that issued millions of stocks at a price of 4.74 dollars i think in the last few months in one instant the stock price went above 40 in the last week and then it dropped to the current 20 so that shows you how crazy this market is how everybody is running after some return speculating on explosive stocks or something like that so there is plenty of money and that usually shows like the charts we have seen before that we are close to the peak because the irrationality is getting bigger and bigger however not everything is that irrational let's see the chinese stock market index the chinese stock market index has been surging in the last few months it went up almost 20 and the only explanation i can see that is that the big fears that people had have weakened and the chinese market was extremely cheap we're talking here price earnings ratio of five six ten like the upi stock we have discussed and one chinese stock that i think i'll make a video in the next week or in the following 10 days so expect that i think it's better than upi and now there is something very important something very important for the long term and something that can go wrong and will impact everybody and that is the fed and they're trimming of the balance sheet and increasing interest rates the probability of a third fed hike in 2017 according to bloomberg is very very high however not everybody likes that and very smart people like ray delio they say that the fed could go overboard on rate heights and balance sheet tightening ray delio discussed how if the fed tightens the balance sheet as planned does from 4.5 billion to 2.5 billion in the next four years it would take off 2.5 percentage points for gdp that would mean a recession and he says that it's impossible that the fed tightens as planned like it didn't tighten as planned in the past 10 years this is very important for our gold hedge because this means that gold prices could go even higher higher and higher as the fed is unable to tighten so keep a gold hedge that's always wise to keep and on the other hand we can see increased risks of a recession because now the fed is pushing the brakes and when that happens usually they are doing it so that they can prepare themselves for the next recession with higher interest rates so that they can lower them it's a very interesting tricky situation ray delio goes on explaining how we are like in 1947 when there was a huge wealth gap this is a little bit further to the line and he looks at politics but it's interesting at the current moment one tenth of the 1% of the wealthiest people in us have the same amount of wealth as the remaining 90% so ray delio discusses how there are two economies 60% of the not wealthy and the other the wealthy and how that wealth gap is diverging so that can have a very populist influence in the next few years especially if a recession comes along then the 60% will wake up and anything can happen so also be careful about that big hedge think about what can go wrong in the stock market for what can go well just be invested and it will go well if you want to protect your financial life feel think also about how it can go wrong and the best way is of course an all weather portfolio a link is again in the description below how important has been monetary policy and central banks in the last 10 years 20 years can be shown by these charts the sound of silence the average number of speeches per month from the ECB fed india has been huge over the last 20 years we are talking seven speeches per month so this is very important because everybody's looking at central banks how are they impacting the economy this is a completely central bank controlled economy and financial markets and this chart shows the increase in the speeches and the speeches have been going up up and up this means that they have to talk much in order to keep the control in their hands and not let it slip sooner or later as always in history central bankers will slip just to finish with a chart and i have just read in the wall street journal that obesity rates in the last 50 years have increased 11 times with children this is a chart with percentage of adult population and we are at 38 percent in the states 32 mexico 30 hungary and so on and so on so when investing you always have to look also at long term trends i think this obesity is one of the most dangerous thing that can affect the country because it has health implication healthcare costs medicare medicaid and those are all very burdened at this point in time so you have to also see how the government deficit will solve that people are less productive perhaps they will attack the sugar industry like they did with the tobacco industry because it's clear that it leads to diseases so also think about positioning yourself in the trends that are unavoidable in the next 10 20 40 years and this is certainly an issue nobody's talking about it now but it's certainly an issue that will come to the table in the next 40 years just some food for thought to finish as always thank you for watching consider subscribing click like if you like the content i'll see you in the next video