An Update On The Degenerate Economy and Some Rules and Advice

I am bringing back Stocktoberfest. Come to Coronado, San Diego October 20-22

An intimate event for executives, influencers, and the most active investors in financial markets. Secure your tickets here.

Good morning everyone…

The ‘Degenerate Economy’ (all my thoughts on this over time are here thanks to Google/beehiiv) continues to ramp/rage/explode so I thought it would be a good time to catch up on many of the trends and companies benefitting and driving it.

The tools and networks are in place to make the degenerate economy a thing. Do not shoot the messenger.

I will begin with some advice for new members of the degenerate economy

More free advice…PAY FOR MENTORSHIP. Every human has a different risk score. Find yours to become a better investor the sooner the better. Start to journal your ideas, trades, results. Don’t worry about building an audience. Build your expertise.

Some other simple advice that is easy to follow but will fall on deaf ears…take Twitter, TikTok, Instagram off your smartphones. Your life and investing will improve. In three days you will be clean of the habit with no regrets. No news really is good news and the desktop versions of these apps and YouTube TV at night is plenty good enough to keep you in touch with, the culture, the celebrity, the ugliness of social, some great content/education and some mindless fun.

Ok now that the ‘good’ advice is out of the way let us begin…

I put together an active Thematic ETF over a year ago that tracks how I think about picking/holding degenerate economy stocks (I own most of these stocks and I use FREC.com for my indexing). I do not spend much time tinkering with it but it is so far crushing the indexes. You can follow it here. It is up over 71 percent.

The degenerate economy continues to ramp...the arms dealers (Nvidia/semiconductors, Apple, Google, brokerages, crypto, social networks) have embedded it and Interest rates don’t matter to it.

When anyone asks me how all this started, I go back to the early days of the internet and Yahoo, specifically Yahoo Sports and Finance.

Us early degenerates were in the Yahoo message boards. Both those Yahoo verticals have survived and thrived even today.

While I am not a gambler (I do not bet on sports - yet), my son and all his friends do. Rachel loves to invest on her own and I can see her betting on sports once in a while.

I love how Ben Hunt (who will be fireside chatting with me at Stocktoberfest in October here on Coronado) sums up the sports betting economy right now:

The degenerate economy is definitely bleak, but it is not going away. My personal views do not matter, when the killer UI makes it’s way into my life I will be participating in the sports capital markets as a better myself. Our firm Social Leverage has been investing in the sports economy for a while (Gemini, Grass Clippings, Commonwealth - data, participation and investing not the gambling business).

My favorite way to capture the spirit of this boom is ‘Speculation as Entertainment’ and ‘Investing as a Sport’ (ht Rob Petrozzo).

I continue to hear that the ‘have nots’ are being degenerates because they feel hopeless. The data says so too.

Home prices have never been less affordable and kids born today have parents hoping that University is doomed.

The salaries of the web 2.0 era for kids out of college will be dropping and while the stock market has zoomed, the economy is not the stock market…

It continues to be a perfect storm for the ‘degenerate economy’ to flourish. Best to learn the language, participate and understand the drivers of it.