The Weekend Edition is pulled from the daily Stansberry Digest.
We've received a few questions like this one from Stansberry Research subscribers lately...
As Stansberry Alliance Partner Mark G. wrote earlier this month...
I am a longtime Alliance Member and I have recently noticed a significant conflict between [True Wealth editor Steve Sjuggerud and Retirement Millionaire editor David "Doc" Eifrig].
Steve says the bull is alive and well – jump on and ride for some more profits.
Doc says the bull is dead and the vultures are feeding on it.
I like both of these analysts, but both can't be right. What do you say?
Mark is essentially correct...
Known in many investing circles as "Mr. Melt Up" these days, Steve has remained bullish on U.S. stocks, even when he warns that a potential "Melt Down" always comes eventually.
Meanwhile, Doc recently has been more bearish than subscribers might be used to. However, we think it's a bit of a stretch to say that he believes "the bull is dead." (Doc likes to say that he's neither a bull nor a bear, but a "realist.")
In any case, Mark reasons that "both can't be right"...
That might be a correct statement by itself. At least on the surface, in their latest publications, Steve and Doc may seem to contradict each other about where the markets are headed next.
But I can tell you three things in today's essay...
- Listening to both Steve and Doc is a wise move. Both can be right, depending on what you are looking for.
- They probably agree on more than you think.
- There's a more important question to answer instead.
Steve and Doc are partners in our company. They've both been here essentially from the start – and the actual start, in Steve's case. But it would be foolish to think that they – or anyone else, for that matter – would (or should) agree 100% of the time.
Sharing different views, expertise, and strategies is central to our ethos here at Stansberry... And it's why we offer the variety of products and services that we do.
Our colleague Dan Ferris – who has also been part of our company since its beginning – once likened the approach to the 19th-century Impressionist art movement. It began with seven painters' works being featured under the roof of a single museum in Paris in 1897.
The painters were Monet, Manet, Degas, Renoir, Cézanne, Pissarro, and Sisley. Odds are that you might have never heard of any or most of them if they'd gone at it alone. As Dan wrote in an October 2019 Digest...
Other artists painted in a similar style, some clearly as talented as the famous seven. But none of those folks became as famous as the seven artists at the Paris museum.
If you were an Impressionist artist in 1897, you wanted your paintings hung in that first Musée du Luxembourg exhibition. And in my mind, if you were a newsletter editor at any time over the past two decades, you wanted Stansberry Research as your publisher.
The idea allows each of our editors and analysts to express their views and share their recommendations with you... And we know you all often have different goals, expectations, risk tolerances, and mindsets.
Not everyone agrees with everything 100% of the time.
Steve, for example, has had success in his career using sentiment and trends to time the markets, including calling for higher stock prices at times when it wasn't popular to do so.
Meanwhile, Doc has done well for his subscribers by recommending shares of high-quality companies at good prices that you can hold for years or decades.
And Dan is a value-oriented investor... He seeks to recommend shares of companies that the market isn't properly pricing.
These three different strategies use different analytical approaches. Sometimes, all three editors reach different conclusions... Sometimes, they come to the same one.
But even if that all sounds well and good...
If you're like Mark, you just want to know if the stock market is going higher or lower...
Forget for a second that the answer will depend on if you're talking about the weeks, months, or years ahead... or which "stock market" you're referring to. (There are countless markets around the world, after all.)
For our purposes, as we head into the fourth quarter of the year, we'll consider the outlook for U.S. stocks over the rest of 2021 and into next year. By that definition, the picture looks like this...
The major U.S. stock indexes – the benchmark S&P 500 Index, the tech-heavy Nasdaq Composite Index, and the good ol' Dow Jones Industrial Average – have roughly doubled since the March 2020 COVID-19 panic bottom. They continue to trade near all-time highs.
But at the same time, the U.S. economy isn't back to normal – and it might not ever be. Millions of folks who were working before the pandemic are unemployed right now... COVID-19 regulations, guidelines, and cases continue to muddle our daily lives.
And when it comes to everyday Americans, we would argue that inflation is the most-talked-about thing on Main Street today. As in... have you seen the price of toilet paper or diapers lately?
Of course, the mainstream financial media doesn't hesitate to throw up the anxiety-provoking red "Sell-Off Alert" graphic at any sniff of a dip in the stock market, either. Those antics scare the pants off of people, leading them to ask this question...
Aren't we overdue for a major stock market sell-off?
It sure seems like it...
U.S. stocks are either near all-time-high valuations or setting new ones, depending on your measure.
If you listen closely to Steve, Doc, Dan, and many other analysts and editors at Stansberry, you'll see they're essentially all concerned about the bottom falling out from this juiced-up market at some point.
But they also say it would be a mistake not to own stocks right now... that things can run on longer than most people expect... and that, frankly, nobody really knows precisely when the next "crash" will happen.
That's why – bullish, bearish, or "realist" – Steve, Doc, and Dan have many open recommendations in their newsletters right now. They still can be right in many different ways, no matter what happens...
The first two recommendations that Steve made coming out of the March 2020 bottom in his True Wealth newsletter are up roughly 150% and 62%.
Doc's top returner in Retirement Millionaire is up more than 1,000% right now... And nine other positions are up triple-digit percentages and remain active buys.
Dan's top pick in Extreme Value is up over 700% since he made it during the financial crisis in October 2008... And a recommendation that he made in July 2020 is already up over 170%.
Of course, not all picks are winners. We bring these examples up to make a point, though...
As longtime readers know, Doc has been optimistic about the stock market for years. And he described well the delicate balance between that and where he stands today well in the September 24 edition of his free daily Health & Wealth Bulletin...
The stock market is the greatest wealth-building tool in all of history. You need to have your money in stocks.
But I'm seeing plenty of warning signs of a coming downturn. And I continue to tell folks to get ready for a major correction.
Does this finally mean I've become a bear?
Well... It's complicated.
In Steve's lingo... for every Melt Up, there's eventually a Melt Down.
You want to take advantage of the opportunity to enjoy massive gains while the good times last... And he often suggests a particular basket of stocks to do so. But at the same time, Steve also wants folks to be aware that the downside can hit quick and hard.
And of course, Dan thinks we're squarely in a "bubble" today... But he also believes you can often do yourself more harm than good by making predictions about what comes next.
If you ask us, being right about being bullish or bearish is important... But more important is knowing what to do in each case.
Anyone who says they can tell you exactly what's going to happen in the markets next is lying...
Plus, it doesn't really matter unless you're prepared to take the next step.
The more important, nuanced question to ask yourself right now if you have any money in the market is this...
Are you prepared for the next big turning point – up or down – when it arrives?
If the market drops 10%... 20%... or even 30%... what will you do? And on the flip side, if it keeps going up and setting records, will you take profits off the table?
Practically, you can only answer these questions by first determining what your goals are for your investments. Most folks never do this, though...
It means thinking about your time horizon, how much growth you hope to attain, and determining the right portfolio allocation – stocks, bonds, gold, or cryptocurrencies, for instance – that works for you.
Here are just two examples of ideas to consider... Are you relatively young and looking to build wealth? Or are you near or in retirement and looking to preserve wealth?
Depending on your viewpoint, you may want to own different assets... or have a different risk tolerance... or use a different exit strategy than your neighbor or some talking head on TV.
The important part is to sit down and take a little bit of time to think about this...
It can go a long way.
Having a plan in line with your goals for your money will not only help protect your wealth during the next major sell-off... but it could perhaps help you gain the confidence to stay in the markets when it feels like the rest of the world is telling you to get out.
Said another way, stop wondering if there will be another sell-off.
Yes, there will be... They always happen eventually.
But there will be rallies, too, in the weeks and months ahead – and maybe even into next year. Nobody knows for sure... So you don't want to miss out on the good times by worrying when the next crash will happen.
And even if you nail a market call to the week, the day, or the minute, it does no good if you don't have enough conviction to take action to profit from it... or protect your hard-earned money.
All the best,
Editor's note: The markets have outperformed since they hit panic last spring... And everyone's wondering what's next. This past Tuesday, Steve, Doc, and Dan went on air to answer this question and more. Most important, though, they shared what you should be doing with your wealth in the face of uncertainty... and also named the No. 1 most dangerous stock in the world. In case you missed it, you can catch the replay of the "2021 Bull vs. Bear Summit" right here.