Search Results for: bubble
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Liquidity, not popularity, is what you should be watching
Roger Montgomery
April 17, 2024
The frequency of calls that the market is in a euphoric bubble is increasing. It’s worth exploring some of the evidence used to reach that conclusion before deciding whether now is the time to adopt a more cautious stance and to ready oneself for the benefits lower prices deliver. Continue…
by Roger Montgomery Posted in Economics.
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It’s heresy to the true believers, but Tesla might be just another car company
Roger Montgomery
April 11, 2024
Wow. Talk about playing the man and not the ball! Perhaps some of the most vitriolic feedback I have encountered has come from those who have chosen to write to me explaining how wrong I am about Tesla (NASDAQ:TSLA) possibly being just another car company.
They’re as staunchly convinced about the company’s prospects as they are about its products. Continue…
by Roger Montgomery Posted in Companies, Editor's Pick.
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Equity markets amid disinflation and economic growth
Roger Montgomery
April 9, 2024
In this week’s video insight, I explore the equity market’s outlook, stressing the balance between disinflation and positive growth against the backdrop of potential inflation and economic slowdowns. Market dips, while concerning, are seen as opportunities, especially in smaller companies, provided inflation or recession risks don’t materialize. I highlight the significant role of the U.S. Federal Reserve and central banks in shaping expectations through interest rate policies. Recent shifts in market sentiment, driven by economic data and Fed caution, illustrate the challenge of forecasting amidst these uncertainties. Continue…
by Roger Montgomery Posted in Economics, Video Insights.
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- POSTED IN Economics, Video Insights.
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Tesla is not a Magnificent 7
Roger Montgomery
March 20, 2024
It appears investors have finally woken up to the reality about electric vehicle (EV) manufacturers; they are just car companies with car company economics. It was always right to question Tesla’s (NASDAQ:TSLA) inclusion in the Magnificent 7. They are a group of companies that only have share price appreciation in common. However, Tesla has always been a bit of an outlier because it lacked one thing the other six have – pricing power. More about that shortly. Continue…
by Roger Montgomery Posted in Companies.
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- POSTED IN Companies.
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You don’t need to forecast to be a successful investor.
Roger Montgomery
March 14, 2024
With all the talk about a bubble in equities at the moment (I think we are a long way from the euphoria that typically defines bubbles), I thought it would be prudent to take a look at the recent forecasting track record of some of the biggest names in funds management and investment banking. Continue…
by Roger Montgomery Posted in Market commentary.
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Ausbiz – Roger pops the market bubble myth
Roger Montgomery
March 8, 2024
In my recent interview with Ausbiz, I discussed the current state of the stock market and addressed the question of whether it is in a bubble. I noted that the typical euphoria seen in market bubbles is absent and highlighted that both the U.S. and Australian market gains, along with current initial public offering (IPO) trends, do not align with typical bubble indicators. Continue…
by Roger Montgomery Posted in TV Appearances.
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- POSTED IN TV Appearances.
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Equity gains and small cap potential
Roger Montgomery
March 7, 2024
In this week’s video insight, I discuss the promising potential for market rallies into 2026, driven by a combination of disinflation and positive economic growth. Highlighting observations and historical trends, I delve into why innovative growth companies, particularly those in the small-cap sector, are poised for significant gains after a period focused mainly on mega-cap technology stocks. Continue…
by Roger Montgomery Posted in Market commentary, Small Caps.
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- POSTED IN Market commentary, Small Caps.
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You are going to be hearing a lot more about bitcoin ETFs this year
Roger Montgomery
February 15, 2024
There’s no fundamental reason for bitcoin to rise other than it is becoming more popular. But as we all know, a shift in sentiment, while usually unpredictable, can have a meaningful impact on the listed price of an asset. Continue…
by Roger Montgomery Posted in Editor's Pick, Global markets, Market commentary.
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- POSTED IN Editor's Pick, Global markets, Market commentary.
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Is forecasting a waste of time?
Roger Montgomery
November 24, 2023
I have had my fair share of bad calls. After more than three decades of investing, it’s safe for me to predict that there is next to no advantage in making predictions. What does make sense is to invest in great businesses and great managers and allow enough time to pass to allow the process of wealth creation within these businesses to occur. Continue…
by Roger Montgomery Posted in Editor's Pick, Market commentary.
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Another pivot in the AI theme
Roger Montgomery
November 17, 2023
We have written previously that the boom in AI-theme-exposed stocks will have to be supported by monetisation in order to be sustained. There are plenty of consumer benefits from artificial intelligence (AI), and consumers will indeed be winners, but for companies to see a transformation in their revenues from AI, something more than just tacking AI-powered features onto their existing products will need to occur. Continue…
by Roger Montgomery Posted in Market commentary, Technology & Telecommunications.
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The dawning of a new financial era: The silver lining in rising interest rates
Roger Montgomery
November 3, 2023
There is much debate about whether rates will rise or fall or stay about here for some time – the latter being my personal stance and prediction. Irrespective of our own beliefs, I think we can all agree interest rates aren’t going back to the lows we saw when the U.S. Federal Reserve cut rates to zero, and our own Australian banks benefitted from the Reserve Bank of Australia’s (RBA) term funding facility, which provided three-year funding at 0.1 per cent. Continue…
by Roger Montgomery Posted in Economics, Market commentary.
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Generative AI’s growing impact on businesses
Roger Montgomery
September 25, 2023
Over recent years, artificial intelligence (AI) has gained considerable traction. And on the back of the resultant excitement, price-earnings (P/E) ratios for stocks even remotely related have soared. Is the excitement premature? Continue…
by Roger Montgomery Posted in Market commentary.
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Streaming TV ain’t what it used to be
Roger Montgomery
September 12, 2023
In 1999, I was working at an investment bank. It was a terrible year to be advising investors to invest in high-quality companies making a profit and to take profit on the technology-related initial public offerings (IPO) listed at massive first-day premiums despite being unprofitable businesses. It was the year of the first technology boom, now known as the Dotcom boom and subsequent bubble. Continue…
by Roger Montgomery Posted in Market commentary, Technology & Telecommunications.
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China wakes up, but is the nightmare just beginning?
Roger Montgomery
August 28, 2023
I have long ignored the reported vicissitudes of China’s economy, unable to reconcile the fact their gross domestic product (GDP) data – obtained from an impossibly large and disparate country – is released more quickly at the end of each month than the U.S. and the data is rarely, if ever, subsequently amended or adjusted. They get it right the first time, every time. A quick look at the piles of junked Chinese products at the local waste disposal centre quickly disabuses one of any belief in China’s systems producing data that is right the first time every time. Continue…
by Roger Montgomery Posted in Economics, Editor's Pick, Global markets.
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How can we ensure affordable housing?
Roger Montgomery
August 1, 2023
As I note below, solving housing affordability won’t be enough with just a massive supply of affordable dwellings rapidly built by state and federal governments. The market for these properties will have to be tightly regulated, and controlled, with continuous maintenance and updates. It’s doable, as is its financing. Continue…
by Roger Montgomery Posted in Editor's Pick, Property.
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Why returns from artificial Intelligence require real diversification
Roger Montgomery
July 31, 2023
As noted previously, artificial intelligence (AI) has been almost the sole reason any investors have taken on risk this calendar year. The NASDAQ 100 is up 42 per cent year-to-date, and its gains are almost entirely driven by the prices of just a handful of mega-cap names that investors believe will benefit directly from AI and whose diversified revenue streams are seen as defensive against an anticipated recession. Tech and AI-exposed stocks are responsible for nearly all the gains in 2023. Continue…
by Roger Montgomery Posted in Technology & Telecommunications.
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Tech rally unveiled retail investors’ long term affinity
Roger Montgomery
July 28, 2023
In this week’s video insight, Roger delves deeper into the tech rally and sheds light on the recent survey conducted by eToro, indicating retail investors’ continued favoritism towards the tech sector for the rest of the year. As earnings season unfolds, Roger analyses the justification behind the high prices of major tech companies like Microsoft, Alphabet, and Meta, emphasising their substantial investments in AI and cloud business revenues. However, the question remains: are the revenue gains from AI truly transformative or merely incremental? Continue…
by Roger Montgomery Posted in Video Insights.
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Leveraging the AI Revolution: An investor’s perspective
Roger Montgomery
July 14, 2023
I have recently suggested for the AI bubble to become a bona fide boom, the fad will need to be replaced by revenue and profits. In this blog post, we dive a little deeper into the business and revenue models companies propose to employ to leverage AI for capital gain and what it might mean for investors. Continue…
by Roger Montgomery Posted in Technology & Telecommunications.
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For the bubble to be a boom, AI will have to be monetised
Roger Montgomery
July 7, 2023
While Google, Meta, Microsoft and Amazon battle it out in the artificial intelligence (AI) race, we all know Nvidia is raking in billions, selling them the GPUs they require while simultaneously sending its market cap into the US Trillion-dollar club alongside its major customers. Continue…
by Roger Montgomery Posted in Companies, Technology & Telecommunications.
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The newest new thing: Nvidia
Roger Montgomery
July 3, 2023
You gotta love a hype-induced bubble. Having been permanently ensconced in financial markets for more than three decades, I’ve seen a few, and there’s another one forming right now. Continue…
by Roger Montgomery Posted in Companies, Technology & Telecommunications.