Rickards and Altucher Agree on This Prediction
Pennsylvania, the Pollsters… and an Altucher Election Call
What a difference 12 years makes.
Back in 2012, Paradigm’s AI-and-crypto authority James Altucher penned a not-entirely facetious proposal to abolish the office of president of the United States.
“I think the institution of the presidency has largely ruined my life and the lives of most other people,” he said.
Despite that assessment — or maybe because of it? — James launched his own candidacy for the 2024 election cycle.
“I went to the website for the Federal Election Commission,” he wrote in a 2021 blog post. “I filled out all the paperwork. It took me 10 minutes. It cost me zero money.”
He encouraged others to do the same and set up a Facebook page where they could announce their own candidacies.
Of course, James realizes he doesn’t stand a chance. But that’s not the point: “When you DO something,” he wrote, “it starts to form cognitive biases in your brain. For instance, I feel I have more of an obligation to have a stance on the issues or at least a stance on how to govern and lead.”
Who does James think will win? And what are the investment implications?
Let’s step back for a brief “meta” message: It’s safe to say that along with Jim Rickards, James is one of the two leading public figures at Paradigm Press.
Jim is a vocal Trump supporter. He also believes Trump will pull out a victory in an incredibly tight race. But those are two separate things: His forecast of a Trump win is the result of rigorous analysis and not wishful thinking.
James, meanwhile, has been extremely circumspect about taking a stand in the presidential race — his somewhat tongue-in-cheek candidacy notwithstanding. He grew up in an America where people kept politics and religion private.
But when it comes to forecasting the outcome, James says: “Trump is going to win.”
“I am not saying this because I am biased,” he hastens to add. “I’m a gambling man and if I had to bet, I would bet on Trump to win.”
James was told by a colleague who once worked for George Soros that Soros laid down a $2 billion bet in 2016 that Hillary Clinton would defeat Trump.
“I’m not going to bet that much. But if I had to bet, I’d bet Trump.”
Among the reasons: “Trump tends to ‘under-poll.’ In 2016 and 2020 states that he lost were by much smaller margins than the polls anticipated. I am guessing people being polled are often afraid to say, ‘I’m voting for Trump.’”
If, as Jim Rickards and others say, the race will come down to Pennsylvania… consider that the average poll gives Harris a one-percentage-point margin there. That compares with this time four years ago when Biden had a 4.5-percentage-point edge. Oh, he ended up winning the Keystone State by 1.2%.
“This is, again, because of the under-polling of Trump,” says James. “If the same holds this year (and it was true also in 2016), then Trump wins Pennsylvania by 2–3%.”
And thus Trump wins the whole shebang.
So… how to invest?
James has several suggestions in the current monthly issue of Altucher’s Investment Network. Out of respect for his paying subscribers, we’ll mention only one here — JPMorgan Chase (JPM).
The rationale is simple. “Trump favors deregulation,” says James. “So a long position in JPM, the biggest bank, is a decent bet on a Trump win.”
Yes, the irony is thick. Trump swept into office in 2016 in part because of lingering revulsion against the bank bailouts of 2008. It was deregulation under Bill Clinton that made it possible for the banks to take irresponsible risks, knowing they’d have a taxpayer backstop.
As for JPM in particular, the bank on Dimon’s watch did business with both the notorious fraudster Bernie Madoff and the infamous sexual predator Jeffrey Epstein. JPM admitted to five federal felonies between 2014–2020 — which is five more than the bank copped to in the preceding 100 years.
But, yes, JPM makes sense as a pick that will prosper under a Trump presidency. Come to think of it, it will probably do just fine under Harris, too; it certainly did under Biden and Obama.
Of course, JPM is a giant, well-known company. It can help you outperform the market, but it won’t make you rich.
If that’s what you’re looking for, James says look no further than an overlooked corner of the stock market — one that he believes could crush every other investment going into 2025.
It has nothing to do with options, crypto, AI or anything else you might expect. (James explains at this link.)
He’s inviting 250 bold readers to join him in a “beta-test” for his newest research service. It’s a time-sensitive invitation, expiring at 9:29 a.m. EDT tomorrow just before the market opens.
Why the urgency? James explains when you click here.
Google’s Nuclear Foray
Microsoft and Amazon have their nuclear deals. Now it’s Google’s turn.
Google spotlights the latest chapter in our ongoing chronicle of AI, its colossal demands on the power grid — and the resulting revival of nuclear power.
In the spring, Amazon signed a 10-year deal with Talen Energy to buy the power generated by the Susquehanna nuclear plant in Pennsylvania. More recently Microsoft signed a deal to buy the power from the shuttered-but-undamaged reactor at Three Mile Island, also in Pennsylvania.
Google is taking a different tack — announcing a deal this week with privately held Kairos Power to use the juice from small modular reactors that have yet to be built.
SMRs, as the name suggests, are a newer type of reactor. They can be built in a factory and shipped to wherever it’s intended for operation. There are about a half-dozen varieties of SMR; Kairos, based in California, uses molten fluoride salt as a coolant instead of water.
The company began construction of a demonstration plant in Tennessee this summer. Google says it expects to be using its first Kairos reactor before the end of this decade, with more to come by 2035.
That’s about the extent of what we know now; neither company is saying how much the deal is worth or where these reactors will be installed.
For as much digital ink as we’ve spilled in these pages about AI’s demands on the power grid — including the prospect of rolling blackouts for residential electric customers because the grid is so fragile — we haven’t spent a lot of time talking about the investing possibilities.
That’s because we’ve sought to be diligent in identifying the best of breed.
Having said that, tomorrow James Altucher’s Microcap Millionaire service will issue a recommendation that’s ideally poised to seize on nuclear energy as the fuel for AI.
This is what we mentioned above about the “beta-test” of this advisory, James’ newest. And yes, we’re serious about the cap of 250 people.
We’ve been waiting for months to tell readers about the right move at the right time in nuclear and AI. This is it. The recommendation goes out tomorrow morning. If you want in, now’s the time. Here’s the link.
Here Comes the Melt-Up
“The fuse is now lit for a stock market melt-up,” says Paradigm chart hound Greg Guenthner.
True, “investors are nervous about the upcoming election, inflation data and what the Fed has up its sleeve as the new rate cut regime takes hold,” Greg allows.
“But under the surface, the markets are turning the page.” The Dow and the S&P keep touching record highs in recent days; at 5,826 this morning, the S&P is only 30 points away from Monday’s record close. And the Nasdaq is less than 2% from its July peak.
“Some of the most explosive stocks and sectors are setting up for potentially powerful end-of-year runs,” Greg says.
“Tech stocks are on the move, along with software names and even some of the forgotten pandemic trades.”
I’m sure many of these names ring a bell. MicroStrategy (MSTR), Palantir (PLTR), Palo Alto Networks (PANW). These were the stocks on everyone’s watchlist following the COVID lockdown.
Remember Datadog (DDOG)? After bottoming in the spring of 2020, it ripped 525% into its 2021 peak! Fast-forward a few years, and it feels like the market is entering a similar environment.
Palantir is printing new all-time highs and triple-digit returns (up 149%) after completing a multiyear base. MicroStrategy is slicing through resistance, up 191% year-to-date. And Palo Alto Networks is on the verge of breaking out.
“More and more tech stocks are popping up as I scan the markets… tickers I haven’t considered buying in years.”
Elsewhere in the markets, precious metals continue looking stout — gold now $2,671 and silver at $31.67. Bitcoin’s break above $67,000 continues to hold. Crude has inched its way past $70 again.
The Totally Nonsensical Sell-off in NVDA
We can’t let today go by without taking note of the peculiar action in the markets yesterday.
“A sell-off in chip stocks weighed on major U.S. indexes,” says this morning’s Wall Street Journal, “with the S&P 500 and Dow both retreating 0.8% and the Nasdaq sliding 1%.”
Well, that’s one way of looking at it. The other is that Mr. Market freaked out in the face of a fluke event.
The big Dutch chipmaker ASML accidentally released its quarterly earnings report a day early. It was a big disappointment — total net sales well below the consensus of Wall Street analysts. ASML shares tumbled about 16.3%.
The worrisome part of ASML’s statement was that “while there continue to be strong developments and upside potential in AI, other market segments are taking longer to recover.”
There was a spillover effect in tech, even onto companies where it made no sense at all — such as Nvidia.
Nvidia is all about AI, right? And ASML’s statement acknowledged “strong developments and upside potential in AI.” And still, NVDA sold off 4.5%.
“As a trader, I love situations like these,” wrote colleague Davis Wilson in yesterday’s Altucher Confidential. “A stock that I love is trading lower on news completely irrelevant to its business.”
How irrelevant? Davis reminds us that demand for NVDA’s Blackwell chips is “insane,” to use the words of CEO Jensen Huang. And that OpenAI will likely spend the bulk of its current $6.6 billion fundraising round on Nvidia chips.
As we write today, NVDA still hasn’t recovered all of yesterday’s losses — up 2.7% on the day. “If you’re looking for an opportunity to get into NVDA before the company reports earnings in a few weeks,” Davis says, “this is a great opportunity.”
Mailbag: War Drums, “Packetized Media”
After our assessment of the beating war drums in the Middle East during Monday’s edition, a reader writes…
“In The Guns of August, Barbara Tuchman’s history of the days leading up to the beginning of World War I, she recounts a January 1910 meeting of Great Britain’s Field Marshal Wilson, head of the Staff College, and France’s Gen. Foch, head of the equivalent French organization.
“Discussing British participation in a French-German war, Wilson asks Foch, ‘What is the smallest British military force that would be of any practical assistance to you?’
“Foch immediately answers, ‘A single British soldier — and we will see to it that he is killed.’
“As the old French saying goes, the more things change, the more they stay the same.”
Dave responds: Several keen observers have drawn parallels between the European leaders who were “sleepwalking” into WWI and the present moment.
The potential for miscalculation is severe — in Ukraine, in the Middle East, in Taiwan. And no one in Washington, on either side of the aisle, has a clue…
As for the AI-generated summary of a series of breakup texts spotlighted in yesterday’s edition, a millennial weighs in…
“As a 30-year-old, I’m gonna have to agree that if you think AI generating these types of messages and AI summarizing them is not the way it should be, you’re behind the times.
“The thing is either party can and will review the information in detail, but this will help them stay high level in their conversations and intentions.
“Keep up the great work at the 5! It’s my only consistent daily read of news in any form. You’re like my AI for the news!
“(Not AI generated, but should have been.)”
Dave: What you say brings to mind the subject of “packetized media” as described in recent months by the intriguing thinker John Robb.
He described it like this in a Substack post just yesterday: “We process information differently now. Specifically, we scan torrential information flows instead of reading or watching long-form books and broadcasts to uncover new, novel or interesting information.
“We use pattern matching to make sense of the packets of information we find through scanning. We can do this independently (few people) or rely on popular podcasters, X accounts or YouTube personalities to pattern match for us (many people).”
In previous articles, Robb says the rewiring of brains in this way is just as profound as it was with the advent of the printing press nearly seven centuries ago.
I feel as if I’m adapting to this new reality better than many of my peers who have adult memories of what it was like before the internet.
But it still pains me, looking at the stack of unread books that continues to pile up…
Best regards,
Dave Gonigam
Managing editor, Paradigm Pressroom's 5 Bullets
