Categories: General Market Commentary- DPC
Topics: General Market Commentary- DPC

Protect Your Wealth from Economic Cracks

Since last week: 

Signs of a worsening economic environment are beginning to show, and it could be serving as a preview of the kind of economic trouble ahead.

1. Yields and Headwinds

The signs are getting harder to ignore now. Bond yields are now at 5%, which means the government is paying more to borrow and interest rates are being influenced higher. No one is talking about a soft landing anymore as oil continues to climb and growth shrinks. Student loan payments have just restarted, which means things are going to get worse. Click here to learn how to protect yourself from the coming economic storm.  

2. Europe’s Nuclear Agreement

European nations are at an impasse about how to pay for nuclear power in order to establish energy security, but they’re hoping to come to agreeable terms soon. France, along Bulgaria, the Czech Republic, Croatia, Hungary, Poland, Romania, Slovakia and Slovenia are hoping to convince Germany that their plan will not undercut prices in the latter’s economy and the sides will meet on October 17. These are important talks because establishing nuclear power is one of the keys to not only becoming energy independent, but reaching goals related to fighting climate change. These talks are over existing facilities but situations like these could easily apply to future power plants. Whatever the case, this is going to ensure there is a steady demand for uranium. As an investor, you can take advantage of that and profit. 

3. Solar-Powered Drinking Water

In the very near future, you’re going to hear a lot more about water as supplies dwindle. The unfortunate reality is that drinking water is becoming more scarce thanks to climate change. Research is being done to find out how to economically turn salt water into drinking water, and scientists at MIT may be on the path to doing just that. They’ve recently designed a solar-powered desalination system that can do so at high volume. Right now, the prototype works for something the size of a small family, but if this technology can be scaled up, it would be a massive breakthrough - one that would cause a further spike in demand for solar panels. Those panels, and lots of other green tech, are powered by copper, among other critical metals. Reasons like this are why you’re going to see a spike in demand for copper. Here’s how you can profit from it. 

4. LG Works with Toyota

LG is investing $3 billion to expand its EV battery plant in Michigan in order to produce batteries for Toyota for the next decade. This is the biggest single battery order for LG, and makes it so the Korean company also has most of the top carmakers in the world as its customers. It seems like deals like this are being struck more frequently, as car companies look to gain an advantage while also benefiting from the incentives offered to them by the Inflation Reduction Act. This is why you want to invest in lithium as the EV sector takes off and car companies fight to carve out their shares.

What to Look For:

Payrolls increased much more than expected, so another rate hike is now being baked in. It’s another sign something is on the verge of breaking.

Ryan Stancil
Editor, Daily Profit Cycle