Stocks Have "Considerably More Downside" & Commodities Have A "Brand New Tailwind" In 2023: Mark Spiegel
"...if you think that based on this bear market’s sentiment we’ve 'seen the bottom,' I wish you luck!"
Friend of Fringe Finance Mark B. Spiegel of Stanphyl Capital released his most recent investor letter last week, with his updated take on the market’s valuation and Tesla.
Mark is a recurring guest on my podcast (and will be coming back on again soon hopefully) and definitely one of Wall Street’s iconoclasts. I read every letter he publishes and only recently thought it would be a great idea to share them with my readers.
Like many of my friends/guests, he’s the type of voice that gets little coverage in the mainstream media, which, in my opinion, makes him someone worth listening to twice as closely.
Mark was kind enough to allow me to share his thoughts from his November 2022 investor letter.
Mark’s Thoughts On Macro
Despite the stock market’s recent rally (we were up a hell of a lot more this month before today!) we continue to carry a large SPY short position, as I believe the major indexes—although not all individual stocks—have considerably more downside to go, the inevitable hangover from the biggest asset bubble in U.S. history.
For far too long, the Fed printed $120 billion a month and held short-term rates at zero while the government concurrently ran a record fiscal deficit. Now, thanks to the massive inflationary hangover from those idiotic policies (November’s “not as bad as feared” data not withstanding), the Fed is reducing its balance sheet and raising interest rates, and although the current rate of high-7% year over-year inflation is unsustainable, the eventual end of China’s “zero-Covid policy” and its November reversal on bailing out its real estate industry combined with the end of Biden’s SPR drawdowns will give commodity prices a brand new tailwind in 2023.