Bitcoin surges....What's up with the Magnificent 7? Fannie Mae - new 5% mortgage
Lifestyle Creep and how it ruins your wealth building opportunities.
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Get ready for an exhilarating ride through the heart of the financial world! The Money Mindset newsletter is packed with insights crucial for every investor. Here's a list of topics that we’ll be diving into today:
Bitcoin Surge: Is the bull market making a comeback with Bitcoin hitting $35k?
Magnificent 7 Stocks: How will AI investments impact their short-term profitability?
Lifestyle Creep: Unveiling the wealth-eroding phenomenon and protective strategies.
Global Tensions: Exploring the market implications of conflicts on multiple fronts.
2024 Mortgages: Your guide to the best mortgage types for new investors.
As you can see, we’ve got our eyes set on some MAJOR sectors, and boy, do we have a lot to share! It's not often that a newsletter brims with this much urgency, but guess what? That's the pulse of our economy, right here, right now. The economic landscape we find ourselves in is nothing short of extraordinary. So, no time to waste! Let's cut to the chase and dive straight into the heart of the action.
Bitcoin SURGES To $35,000 After Breaking Its MAJOR Resistance Of $32,000!
Why Is Bitcoin Pumping?
As Bitcoin SURGED through its MAJOR resistance just under $32,000, it headed straight to $35,000 for the first time in over 1 year. The main reason for this price action was due to the recent developments in Blackrock’s application process to bring a Bitcoin Spot ETF to the market. The major developments are as followed:
Receiving A Ticker Symbol (IBTC)
Designation of a CUSIP Number to the Ishares Bitcoin Trust
Getting listed on the Depository Trust and Clearing Corporation (DTCC) which is responsible for clearing Nasdaq trades.
While this doesn’t mean that the application has been approved, this has created a great deal of optimism for Bitcoin investors. This shift in sentiment sparked by the major developments in the ETF approval process for Blackrock’s crypto product resulted in the largest amount of capital inflows into the crypto markets that we’ve seen in a very long time…
What is Blackrock Doing To Prepare For The Pending Launch Of Their ETF?
Seeding the ETF would be the next step. Having obtained its ticker and CUSIP number, and having been listed on the DTCC, Blackrock’s next logical step would be to seed the Spot Bitcoin ETF, and it has been reported that they would do so this month. Many are speculating that the price surge on Monday was a result of seeding, meaning that Blackrock was buying up a good deal of Bitcoin to seed its ETF. When directly asked about this, a Blackrock spokesperson stated that the firm was unable to comment due to “filing restrictions,” thus, reports of this being true are merely just speculation for now, and there is no concrete evidence of this being true, though I do admit that it would make a lot of sense.
How Close Is The Blackrock ETF To Being Approved:
While many are perceiving this information as approval for the ETF, it’s very important to note that this isn’t the case (yet). While I do admit that these developments are extremely encouraging, it’s important to remain objective to understand where the approval process is at. There is a lot of misinformation out there, so I will paint a clear picture of the stage that the application is in now…
Most recently, on 9/28/2023, the SEC invited the public to offer its feedback on the application, which gives anyone who wants to submit a comment the chance to do so until the deadline, which is on October 25th. Following this deadline, individuals will have until November 8th to reply to comments made in regards to feedback submitted on the application.
According To Litigator Joe Carlasare who is following this process closely, the SEC Typically does not approve proposals until the conclusion of the comment request period, as it is an essential part of their regulatory process. He stated in a tweet on X that “Usually, after the comment period ends, there’s an additional 30-60 days reserved for comment review.”
Final Thoughts:
Thus, those who expect instant approval of the ETF due to recent developments are misinformed about the application process. It's reasonable to assume that the price surge resulted from optimism following tangible progress, such as being listed on the DTCC. While it's speculative, it's also fair to consider that Blackrock's ETF seeding might have influenced the spike, although concrete evidence is lacking. I'll keep a close eye on any significant updates in this process – stay tuned for more information!
How NVDA, Amazon, AAPL Plan To Grow Their Revenues + Profitability With AI-Powered Products
Nvidia (NVDA)
It’s no secret that Nvidia (NVDA) has had a MONSTER year thus far, as it's up over 190% YTD, and its market cap has soared above the $1 Trillion milestone marker. Therefore the question is not whether its growth is real, but whether its growth is sustainable. While I’m not here to definitively answer that question in this newsletter, I will show how they are perfectly positioned within the AI boom to continue raking in high revenue figures on a quarterly basis.
Positioning within this AI BOOM, as well as the continuous development of their other AI-related products have continued to power this Mega Cap gem's growth. Most notably, Nvidia’s high-end GPU chips have been in extremely high demand Since OpenAI’s ChatGPT emerged last November. Since ChatGPT has emerged, NVDA has been OpenAI’s primary supplier of GPU chips, and this is important because these chips are what maintain the quality of ChatGPT’s chatbot’s performance parameters. To maintain its elite chatbot performance, OpenAI has already announced that it will require as many as 10,000 new GPU chips heading into the new year, and this will probably be a major contributor in sustaining, and even growing Nvidia’s revenue. Thus, these strong fundamentals suggest that NVDA’s products, such as their GPU Chips, will remain HIGH in demand!
Amazon (AMZN)
For so many years, Amazon (AMZN) has dominated the online retail sector. As an investor, there are a lot of geopolitical uncertainties, as well as economic concerns that could cause turbulence for an online retail company’s overall revenue. For example, if there is a prolonged recession, people by the masses will likely lose their jobs, and a result of that could be far less spending, I.E less revenue. Or if you are looking at the geopolitical outlook right now, there are wars on multiple fronts intensifying. Could this affect supply for many products if the situation between countries were to continue to escalate? I would tend to think so... While these are just examples, they are important considerations when looking at a company that brings in so much of its revenue from online retail.
Aside from online retail, Amazon seems to be all in on AI which could create streams of revenue aside from its online retail division like never seen before. Let’s take a look at how they are integrating AI-powered solutions to increase their offerings and revenue long-term.
Amazon Web Services is a MAJOR player in the cloud computing world already, and the company has been investing into AI-powered technology products to make this even better. Not only are they integrating AI-powered tech into AWS, but they are also developing AI-powered products such as a software code development tool, a chatbot (potentially like chatGPT’s) and an image building platform. Amazon has the cash on hand to develop these simultaneously. While the picture is somewhat unclear of what this all looks like together, its potential seems to have no ceiling and could potentially be a HUGE factor of the stocks growth in the future.
Apple (APPL)
Unlike MSFT who has OpenAI’s ChatGPT, or Google that has their Google Bard AI Chatbot, Apple has been relatively quiet in terms of AI product development, as they presumably have been working behind the scenes on this… that is, until now.
It was just reported by Bloomberg Report that AAPL plans on spending $1 Billion annually on AI-powered products and integration. For example, they want to integrate AI into ‘Siri.’ Additionally, the report claims that Apple is creating their own AI-powered Chatbot, perhaps to rival that of Microsoft and Google’s. For a company that already posts great financial figures, the potential with AI seems unlimited - not just in sustaining their revenue and profit figures over time, but in growing them...
Lifestyle Creep: What Is It, And How Can We Combat It In Our Own Lives?
Lifestyle Creep, also known as lifestyle inflation, refers to the gradual increase in an individual's spending habits as their income rises. As people earn more money, they tend to spend more on luxury items or non-essential expenses, often without realizing it. This can lead to financial instability and make it difficult to achieve long-term financial goals, such as saving for retirement or building an emergency fund.
To avoid lifestyle creep and maintain a balanced financial life, consider these 5 practices:
Budget Mindfully: Create a budget outlining your necessary expenses and savings goals. Be aware of your financial limits and avoid unnecessary expenditures that don't align with your priorities.
Automate Savings: Set up automatic transfers to your savings or investment accounts. By saving a portion of your income before you have a chance to spend it, you ensure financial discipline and long-term stability.
Track Expenses: Regularly monitor your expenses to identify any patterns of increased spending. Use apps or spreadsheets to categorize your expenditures, enabling you to recognize and curb unnecessary costs promptly.
Set Clear Financial Goals: Establish specific, measurable, achievable, relevant, and time-bound (SMART) financial goals. Having clear objectives can help you stay focused and avoid frivolous spending that doesn't contribute to your financial ambitions.
Practice Gratitude: Appreciate what you have and cultivate contentment. Gratitude can shift your perspective, making you less inclined to pursue material possessions solely for the sake of keeping up with others.
By adopting these practices, you can protect your financial well-being from the subtle but significant dangers of lifestyle creep, ensuring a more secure and fulfilling financial future.
How Does The War In The Middle East Affect The US Economy- Oil, Stocks, And The Global Economy
Oil Market/Ramifications:
The sector that will have the biggest immediate short-term impact if the conflict continues to intensify is the energy sector - not just in the US, but globally. Within the energy sector is oil, which was already at a high level heading into the conflict. Thus, while prices weren’t drastically affected right away, this is more so a result of oil prices being high to begin with.
If we were to assume that conflict was going to intensify, we could also assume that the probability of supply disruptions would increase greatly as well. So, while this hasn’t happened quite yet, the market is on edge due to the very fragile nature of this conflict.
While oil production hasn’t seemed to be drastically affected by this conflict (yet), the price per barrel has already risen about $5/barrel, perhaps in anticipation of supply disruptions in the near future. Supply shocks resulting in rising prices would have major implications for oil importing countries, so this is something to watch.
Stock/Economic Ramifications:
Rising energy prices due to supply disruptions paired with intensification of the war, especially if more countries are stepping in, could have serious ramifications on the stock market as well. First and foremost, rising energy prices would further complicate the task of getting inflation back to its target. With the threat of a recession already looming in the US, this could be the domino that tips this from threat to reality.
We’ve seen throughout history that higher inflation results in less money for spending or investing. As these conditions persist, your average employee can’t afford to hold investments anymore, and often look to sell in order to generate the cash that they need at the moment. Pair this with a recession in which people are not only dealing with inflation, but getting laid off by the masses, you can see the gleamy outlook that this creates for the markets.
Thus, while geopolitical tensions rise, and economic conditions remain fragile, it’s important to start considering ways to prepare for this type of reality. Here are some general tips to get you started:
Invest Wisely: Consider investing in assets that historically outpace inflation, such as stocks, real estate, or commodities. Diversifying your investments can help spread risk and preserve your wealth against the eroding effects of inflation over time.
Adjust Your Budget: In times of inflation, it's essential to review your budget regularly. Cut down on unnecessary expenses and focus on essential items. Look for ways to save, like cooking at home instead of dining out, and be mindful of your energy consumption to reduce utility bills.
Consider TIPS and Bonds: Treasury Inflation-Protected Securities (TIPS) and certain bonds provide returns that adjust with inflation. Investing in these instruments can help safeguard your investments from losing value in real terms due to rising prices.
Pay Down Debt: High-interest debt can become more burdensome during inflationary periods. Prioritize paying off high-interest loans to reduce financial strain. Refinancing debt at a fixed interest rate can also provide stability in your repayment plans, protecting you from future interest rate hikes.
By being proactive, diversifying your investments, and managing your expenses wisely, you can mitigate the adverse effects of inflation and maintain your financial well-being.
Fannie Mae - 5% mortgage is an amazing new option. Here is the scoop:
Up to 4 doors
Up to $1.3 million dollars
Only 5% down payment
Owner occupied
Lower credit requirements
So if its a good time to buy that first investment property this is certainly an amazing new mortgage option.
Thank You all for joining and following along on this amazing wealth building journey with! Let’s Goooooooo