Being Responsibly Irresponsible
Since this Thursday is Thanksgiving, I wanted to get this week’s article out to you today so that you can enjoy the holiday with your family. Future articles will continue to be sent out on Thursdays. Happy Thanksgiving!
Just as we’re seeing Christmas lights to signal the holiday season, we’re also seeing “investment guru” tweets on the timeline to signal the transition from Crypto Winter into Crypto Spring. Crypto Spring - a time where the weather (the narrative) is changing and prices are finally starting to bloom. With this change in season, come the “geniuses” (either on twitter or in real life) telling you about their gains. In fact, I’ve already seen a number of people say that looking for a 5x in crypto is a waste and you’ll still be poor. It’s already too late for the major crypto names - you need to find the next 100x coin… These people are gamblers, plain and simple. Regard them as such.
People view investing - especially in crypto - as a get rich quick scheme but with a layer sophistication because they can all themselves “investors”. I remember at the height of the last cycle, a guy I know (a mechanic with zero financial/investment knowledge) was telling me to buy some shitcoin that he had no idea about but his boss told him he’d make money on it. These people will resurface and it’s important to be wary of these types. They’ll hunt for small coins that could see parabolic pumps and, if they’re lucky, they’ll make big money. This is gambling. Go play roulette if that’s what you’re looking for.
And here’s the thing…your job isn’t to find the next memecoin, your job is to outpace the rate at which the dollar is being devalued. It’s to beat the Fed. That’s who you’re up against. The Fed is and will continue to print money at a record pace and the currency will be worth shit. We want to grow our wealth at faster pace in order to not slowly drown in a sea of inflation.
This next cycle will be made up of banner years. Years where we’re going to look at our account balance with a huge grin. This comes from being positioned in the right places - the names that will see insane growth. Not from chasing after “the next big meme” and playing a guessing game. That’s just being irresponsible with your money.
There’s gamblers and then there’s investors.
We want to be responsibly irresponsible. What I mean by this is quite simple. Risk is inherent in any investment. The level of risk determines the amount of reward that could potentially be reaped. You need to constantly be thinking in these terms - the risk curve. A “gambler” throws big money into HarryPotterObamaSonic10Inu (actual crypto coin) because he thinks this will pump into the stratosphere. It might, but the whole investment thesis “haha funny meme”. That’s not a strategy. It’s irresponsible.
An investor assesses a company or a coin and looks at catalysts, sector trends, valuations, institutional buying, balance sheets, revenues, etc. When we’re being responsibly irresponsible, we’re finding companies at the forefront of groundbreaking technology that have sold off recently and we’re making large, long-term investments based on the data we have. We’re taking large, concentrated bets on risky stocks that show a promise of massive rewards in the future. Buying when there’s blood in the water. Being greedy when other are fearful. That’s being responsibly irresponsible.
Last year was a great example of this. Buying in 2022 and remaining calm when everyone was screaming for a recession, never-ending inflation and market collapse. That’s taking calculated risks.
The vast majority of Americans are stuck at a job that will not see a real wage increase, who will throw their money into depreciating assets (cars, etc.), load up on debt and completely miss out on the next few years of monstrous gains. All we have to do is position ourselves now and ride it out. In Raoul Pal’s words…don’t fuck this up!
In this week’s premium portion, I revisit one of my picks from a previous article that’s up 20% since being given to my premium subs (linked here). We’ll take another look at this company because there’s still a lot of gas left in this stock. I believe this will be one of the biggest performers in the upcoming cycle. Let’s take a look…