"As Hemingway might have said, at first inflation happens slowly – then all at once,” CEO Keith McCullough wrote in today’s Morning Newsletter. “If you want to be a real baller, and be long the stuff in the U.S. stock market that’s crushing a low-single digit performance # for the YTD, you need to be long of both inflation and the slow-growth it drives into the consumption core of America.”
In the video below, Senior Analyst Darius Dale discusses dividends and style factors within the U.S. equity market and why he cast his vote to buy and hold U.S. Stocks.
What do you think?
In the poll this morning we asked: If you had to choose U.S. Stocks or Commodities, which would you buy and hold for a year?
At the time of this post, 56% would buy U.S. Stocks and 44% would choose to buy Commodities.
Those who view buying and holding U.S. Stocks as the better opportunity had this to say:
- Stocks have dividends and commodities don't, so that has to be factored into any decision to buy and hold. Certain sectors and style factors within the equity market are responding to the same fundamental signals that commodities are -- i.e. inflation slowing growth and weighing on the Fed's outlook for tighter monetary policy. Buy XLU, XLE, VNQ and SMH. Long live late-cycle industrial pricing power!
- There is so much liquidity around the globe from governments printing their monopoly money. The money has to flow somewhere and it sure isn't to savings accounts. This is the new normal until, if ever, the liquidity is removed from the financial system.
- Though commodities will continue to rise, there are a few tech stocks I'd put my money into, including Twitter, Facebook, Apple and Google. The bubble still has room in it; the trick, as always, is timing.
Those who voted for commodities reasoned:
- Commodities have done well YTD. As inflation accelerates and Q114 GDP estimate is even worse than originally estimated; precious metals and other commodities will continue to ramp. This is stagflation and this could be just the beginning a US replay of something like the 1970s.
- Commodities are looking nice right now, and there are really no unpredictable events that could not go in favor of commodities. All the prices are on the rise across the board from uranium to beef.
