Santa Claus Rally -- Day 3 -- 2020

The Santa Clause rally is tracked here. 

I haven't checked but I think all three major indices hit all-time records earlier this morning. Maybe the Dow didn't, I don't know. A quick look suggests it hit an all-time intra-day high at 30,525. If true, and someone will confirm that at some point, then that looks like the new number to watch (for the Dow): 30,525. 

A few days ago, it was suggested that the number to watch for AAPL was 138. What is it today? Up over $4/share. Up over $136.

This must be a really, really bad day for Steve Liesman. 

Does anyone seriously think Joe Biden is going to take away the punch bowl in his first two years? He's even backed away from his "mask mandate" and another nationwide lock down. He's not about to destroy one of the best economies ever for the rich and powerful.

One of the companies I invest in is because, a) it's a great company; b) it's makes a lot of money; c) it has a huge moat; and, d) it pays a huge dividend. Today, on a day the market is surging, the shares in this incredible company actually lost a about a percent (less than a percent, to be more specific). One has to ask why? Profit taking to buy other stuff. When you can buy shares in growth companies that appreciate at 1000% over a year, why buy value companies that pay 5%?

My feelings about renewable energy, EVs, Tesla, etc., is about the same way many people feel about fossil fuels or nuclear energy or fertilizer. But at some point, investors like me will throw in the towel.

My comments to a reader earlier this morning:

I think the tipping point for EVs for me came in the past month or so: 1) Biden's stolen election; 2) Ford e-Mustang; and, 3) Daimler building EV trucks in Portland, OR. I don't know if it's accurate or not, but Daimler Freightliner brags that it is the #1 Class 8 truck manufacturer in the US. 

Class 8 truck manufacturers in the US by volume:

• 2007 - 2018;

Apr 20, 2020 — In 2018, Daimler's Freightliner division sold more than 90,860 Class 8 trucks. With a 36 percent U.S. Class 8 truck market share, Freightliner is also the market leader in the United States.

• dominated by Daimler Freightliner; 
  

EVs: I think folks forget that presidents are change agents. Biden is too old to be a change-agent but he will surround himself with folks who are or want to be. There's nothing bigger than "climate change." Period. Dot. Even if it's a scam, and I think it is, there's nothing bigger than "global warming." 

Every mover and shaker from Warren Buffet to Jeff Bezos (that's going through the entire alphabet one time, "B" to "B") "believes in "global warming" or at least invests like they believe in "global warming." As an investor, to fight both Bezos and Buffet is crazy talk. And don't even get me started on another "B": Bitcoin. Or (air)BNB. 

A is for AAPL; B is for Bitcoin; C is for chips.

My hunch is that for investors in energy, this decade is going to be a huge. In energy, mojo-based investors can invest in companies like Tesla and Plug Power (hydrogen); and, for reality-based investors, they can pick carefully among the fossil-fuel companies. 

I just noticed on the crawler that on a day that the stock market is surging, and tech stocks are surging, and chip stocks are surging, Qualcom is down slightly. One word: Apple. One ticker symbol: AAPL. 

Where was I?

Oh, yes, investing in EVs.

From a "climate energy" site, the list of countries with targets to phase out ICEs:

• Austria: no new ICE vehicles sold after 2020 (no typo; I don't know how hard and fast that "mandate" is)
  
• Britain: 2040; hybrids excepted
• China: end production and sales by 2040
• Costa Rica: phase-out begins next week, 2021
• Denmark: no date, but tax incentive in place since 2008
• France: 2040
• Germany: 2030; no registration of ICE vehicles by 2030:
• India: 2030;
• Ireland: 2030; incentives in place sine 2017
• Israel: 2030
• Japan: just announced -- pending update -- 2030 or something like that
• Netherlands: 2030; phase-out begins 2025;
• Norway: 2025; incentive program in place since 1990;
• Portugal: announced but no specific date
• Scotland: 2032
• South Korea: targets
• Spain: incentive plans
• Taiwain: 2040; replacement of all government vehicles, public buses by 2030

Does anyone seriously think that Biden doesn't want to be on that list? My hunch: California goes first, and then Biden follows. California has already started: see this Forbes article just a month ago or so.

As I was saying, presidents want to be change agents. I'm not saying they made the right choice, and I'm not saying they succeeded but ....

• Abe Lincoln: save the union
• LBJ: civil rights
• Ronald Reagan: "tear down this wall"
• Obama: healthcare
• Trump: make America great again
• Biden: anyone think that the "LBJ-civil-rights" or "Obama-health-care" won't be the framework for the "Biden-save-the-earth" program? 

I think Biden served in Congress or in the administration of every-aforementioned president. His memory may be going, but he probably has more political savvy in his little finger than any other politician dead or alive. He beat Trump, didn't he?

I think the "Biden Energy Plan" will be much, much bigger than any of us realize. And unlike healthcare, where it was challenging for investors to figure out where to make money, the massive shift in energy emphasis will really benefit a lot of investors. The lower-middle class will likely disappear, going broke spending money on renewable energy but investors will be at the table, taking their money. Sounds cynical, but it's not meant to be that way. It seems to be reality.  

The only question: how "big" will Biden go in his first energy policy speech? My hunch: it will rival JFK's "putting-a-man-on-the-moon-by-the-end-of-the-decade-and-bringing-him-safely-home-again" speech.

Repeating:

My feelings about renewable energy, EVs, Tesla, etc., is about the same way many people feel about fossil fuels or nuclear energy or fertilizer. But at some point, investors like me will throw in the towel.

I've seen the movie. Several times. At least twice a year. It was released in 1964. 

Dr Strangelove.

Or: How I Learned to Stop Worrying and Love The Bomb.

Paraphrasing Jim Cramer, I'm not investing to change the world, I'm investing to leave Sophia a nice little portfolio.

The sequel: How I Learned to Stop Hating Renewable Energy and Love Batteries.

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A Pot Of Gold At The End Of The Rainbow

Photo below from Sophia this morning in the US Virgin Islands on a catamaran for twelve.

The boat in the photo, I believe, is like the one on which Sophia will be living for a week. 

Speaking of pots of gold: the US House will vote on a stand-alone bill for a $2,000 stimulus check for "all" Americans, whether they need it or not.  What a great country. A country that takes 25% of your income in taxes and then returns 2% and we feel good. 

By the way, for many of those folks receiving $600 or $1200 or $2000 or $2400, they will turn around and put it into the stock market. We won't get the full amount but we will receive a significant amount. Last time, I gave the "credit card" stimulus money to my wife. Over Christmas holidays she said she finally spent the last of it while Christmas shopping. That's how long it lasted. I was impressed.