Tales From the Crypt of Nostradamus
On April 17, 1793, three French soldiers broke into the tomb of Michel de Nostredame, a man we know as Nostradamus.
Legend has it that one man, a Corporal Adelaide, picked up the skull in an attempt to gain the power of the long-dead seer.
His fellow soldiers bore witness that his eyes opened wide as he gained full knowledge, then was immediately struck down and killed by an errant bullet, fired from the nearby riots.
A plaque around the neck of the corpse read 1793.
It is by channeling the ghost of Nostradamus — as if drinking blood from the very skull itself — that I give you my bold predictions for 2019.
Today, I bring you seven events that will happen in the unpredictable, disruptive long-shot year of 2019.
1. Natural gas will spike in February as cold weather, low inventory levels, and surging exports continue to put pressure on price.
The way to play it is to trade VelocityShares 3x Long Natural Gas ETN (NYSE: UGAZ), which is now back to a low.
2. A major car company will fold.
Here are auto stock returns in 2018:
- Tesla: +17%
- Toyota: -5%
- Fiat: -11%
- GM: -11%
- Nissan: -14%
- Volkswagen: -18%
- Honda: -21%
- Ford: -23%
- Daimler: -32%
- Tata: -66%
And auto sales are just off all-time highs. If they can’t make money in this market, they are doomed. Sell Nissan, Tata, and GM.
3. The easy trade of the year will be to short Netflix and buy Disney.
For the past few years, Disney (NYSE: DIS) has been a drag on the Dow Jones Industrial Average. This is because DIS owns ESPN, the sports network. For years, ESPN dominated cable. But then the company decided to go into political punditry at the same time their customers were cutting the cord. Cord cutting combined with a general disinterest in the NFL wacked Disney’s bottom line.
But late next year, Disney is launching its streaming service. This could put an end to the company’s cord-cutting woes. Disney is also heading into a blockbuster 2019 movie line-up that is headlined by the next Avengers, Captain Marvel, Dumbo, Aladdin, Toy Story 4, The Lion King, Star Wars Episode 9, and Frozen 2.
DIS has a P/E of 13.28 and pays a 1.57% dividend.
Netflix has a P/E of 95 and pays no dividend.
4. Space stocks will be big performers.
Despite the many new milestones happening in space right now, public companies that supply much of the gear for space flight haven't gotten much love from the markets. This is going to change.
First, there are only a handful of space stocks. Second, the first space ETF, the SPDR Kensho Final Frontiers ETF (NYSE: XKFF), just launched. Three more are to follow. They will all have to buy these same stocks. That and continued growth will send the stocks higher.
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5. Coal stocks will also do well.
Wells Griffith, President Donald Trump's advisor on energy and climate, was recently at this year's largest climate change conference held in Poland.
Griffith took the podium Monday and said, “We strongly believe that no country should have to sacrifice economic prosperity or energy security in pursuit of environmental sustainability.”
The room erupted into laughter, punctuated with shouts of protest. Here’s the video.
They laughed him out of the room. And the contrarian investor in me loves it.
You see, the world's cities are expanding by 75 million people a year. And coal supplies 40% of all power generated. It's the backbone of global electricity.
China, India, and Southeast Asia are all building out coal power plants. Add to this the growing number of electric vehicles (EVs), and the demand for coal power will continue.
I’ve found one coal company that pays a 10.64% dividend. Click here.
6. A deal with China will send Chinese internet stocks soaring.
Chinese stocks are in a bear market, with internet stocks down over 30%.
China will make some sort of deal with Trump. This will in turn send the stock prices of Chinese internet companies like Alibaba, Tencent, and Baidu up sharply.
7. Amazon will break in three.
Amazon (NASDAQ: AMZN) is building two new headquarters so it can split into three companies.
Bezos will make the move to stop Trump from starting monopoly hearings.
Amazon will split into media (Prime) in New York, cloud (AWS) in Northern Virginia, and retail (Amazon) in Seattle.
A Cloudflare IPO at 35x revenue could add $611 billion to its combined market cap.
All the best,
Since 1995, Christian DeHaemer has specialized in frontier market opportunities. He has traveled extensively and invested in places as varied as Cuba, Mongolia, and Kenya. Chris believes the best way to make money is to get there first with the most. Christian is the founder of Bull and Bust Report and an editor at Energy and Capital. For more on Christian, see his editor's page.
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