Update - May 18, 2021

These Powerful Trends Prove It’s a Great Time to Be an Investor

This has to be one of the greatest times in history to be an investor.

It’s never been cheaper or easier to buy shares in the greatest companies in the world. Technological innovation has never been as robust or dependable. And never has the effort of the government to prop it all up been more favorable… or more insane.

We’ll get the latest meeting minutes from the Federal Reserve tomorrow. Until then, we don’t need to guess what the money keepers talked about last month. In just the past few days, several Fed officials have emphasized the need to keep rates lower for longer, reiterating Jay Powell’s official stance.

That means the easy money will keep flowing.

It’s great news for our stake in KBR (KBR), a stock that has had a phenomenal performance over the last eight weeks. It’s outpaced the S&P 500 by 5-to-1 since mid-March.

The builder of all things big has been helped along by one huge contract after the next… many of which are directly funded by Uncle Sam.

The company’s latest contract is a good example. KBR just locked down a $51 million deal with the National Oceanic and Atmospheric Administration. It will help the agency track weather in space.

But even the company’s nongovernmental contracts are influenced by the nation’s agenda. For instance, KBR just signed with Cummins (CMI) to work on a “green ammonia” project. The aim is to cut carbon emissions from what is currently a rather dirty process.

Shares of KBR have doubled since we got in. Understanding Washington’s motives and how it spends has played a big role in this successful play.

But if we were investing only in the things our keepers were pushing, it’d be tough to sleep at night. We certainly wouldn’t use such logic to declare this the greatest time to be an investor.

For that, we must lean on technology and the immense effect it’s having on our economy.

Getting Smarter

While the COVID-19 crisis gets all the credit for transforming the way we do business, the real hero has been technology. The pandemic was merely the catalyst that set off the explosion.

It’s why the “Deflation Leaders” category of our Modern Asset Portfolio has been so crucial to our success. New technology is driving down the cost of doing business.

Despite rapidly growing talks of inflation and fears of even more, the cost of doing business is falling in many industries.

It makes sense. New technology is creating immense efficiency while reducing both the number of employees a company needs and the overall cost of those employees.

Logitech (LOGI) is a good example of this.

I’ve written a lot about its work-from-home product lineup. It’s a leader in webcams, microphones and other devices that allow folks to communicate from anywhere in the world. Because of Logitech’s products, companies are saving tremendous amounts of money on not just office space but also travel expenses.

Why pay for airfare, cabs, hotels and travel time when a simple webcam and laptop will get the job done?

Just today, Logitech released the details on new technology that will make the job even more efficient. Its new Scribe product is a whiteboard camera that’s powered by artificial intelligence. With the push of a button, it gives online meeting attendees the same view as folks in the boardroom.

Soon, every company (and school) will have one. And when they do, they’ll need less office space and fewer parking spots, and there will be less demand to bring folks to the office.

Again… technology makes it a great time to be an investor.

We’re up 60% on Logitech.

Finding Alternatives

But there’s another reason that right now is an ideal time to be an investor. It has to do with a trend that’s just starting to emerge. It’s one few folks truly understand… or are even talking about.

It hasn’t made big news, but just like the East Coast pipeline shutdown, a big swath of the Mississippi River was closed last week. It had nearly 1,000 barges that were filled with corn, soybeans, steel and oil backed up and at a standstill.

The immediate problem was a topic lots of folks are talking about… failing infrastructure.

But the bigger problem with the halt in trade on the Mississippi, with the pipeline and even with the recent Suez Canal mess is that there is no backup. And the problem is not just with physical infrastructure.

It’s one of the greatest lessons of 2020. Due to complacency, the nation has grown immensely centralized.

Last year, we saw it when our grocery stores’ shelves went empty. We’re seeing it now with lumber prices and semiconductor shortages.

Fortunately, the free market is working on solutions. Decentralization will soon be a major moneymaking theme.

For investors, it spells a big opportunity.

Take the news from one of our most recent entries, railroad dominator CSX (CSX). Late last week, it announced it will buy Quality Carriers, the king of bulk chemical truck transportation.

Not wanting to be locked into only rail transportation of chemicals, CSX will now be able to offer its customers an alternative.

Yes, it centralizes power in the hands of CSX – which is good for investors but not so great for customers or consumers if the company runs into a hiccup – but it shows the trend that many companies are focused on right now. They want to diversify their offerings and have alternatives.

Our stake in CSX will treat us well.

But perhaps an even better example of decentralization is the asset that sits atop our portfolio’s leaderboard… Monero (XMR).

As an alternative form of currency, it’s the free market’s answer to a system that’s looking wobblier by the day.

Its expansion into the marketplace shows just how strong the trend has become. Right now, nearly 1,000 merchants accept Monero. More than 30 of them just signed on in May.

With more folks open to Monero, use is soaring. Year over year, the number of transactions has more than doubled – from 10,000 per day to more than 23,000 per day last month.

It’s big growth… but still a tiny figure compared with the entire economy.

It proves that there’s plenty more to come. And it proves that this is an ideal time to be an investor.

Never before have so many powerful trends been weaving their way through the markets at the same time.

Let’s take advantage of it.