You don’t have to be a rocket scientist (or any expert macro market analyst for that matter), to notice that risks are rising. Probably, you may feel it in the air. If not, your television will teleport that vision. War, potential WW3, guaranteed food shortages, tyranny in Canada, a looming ‘cyber-attack’, further supply chain disruptions for Covid in China because of continued inhumane government lockdown measures (yes, they are back at it), continued negative REAL interest rates (nominal rates minus inflation), US inflation soared 7.9% in past year, a fresh 40-year high… everything seems to be going according to plan for the Davos Man (Global Elites) to bring about the ‘Great Reset’ under the disguise of caring for the planet, the climate and to ‘Build Back Better’.
Below chart shows the www.ShadowStats.com calculation of inflation compared to the official CPI (also called CP Lie):
When Vladimir Putin and Xi Jinping release a joint statement vowing to “accelerate the implementation of the UN 2030 Agenda for Sustainable Development” by cooperating on “key areas” like “vaccines and epidemics control, financing for development, climate change, sustainable development, including green development, industrialization, digital economy, and infrastructure connectivity,” you’d better believe they are actively collaborating on the promotion of an AI-driven, Fourth Industrial Revolution globalist agenda with their WEF cronies.
Bill Gates “warning” us that “we’re not ready“ for what he calls “the next epidemic,” you’d better believe that he’s using his monopolization of global “health” to prime the pump for the COVID scamdemic.
Also valuation wise, we are still of course in highly overvalued territory for Growth (technology…), but still undervalued for our favourite sectors in Value (commodities and energy).
So, why hedge you say? We are mainly in value stocks, commodity stocks etc… so we are safe right?
Not so fast. When technology goes through a major correction due to either a surprising hawkish interest rate move in May by the FED (American Central Bank) (like anything above 25-50 basis points, anything above 0.25 to 0.5 %) or another geo political surprise (like a leak in one of the Ukraine based, NATO and US sponsored biolabs…), we could see a drastic sell-off and forced liquidations when (over leveraged) people and institutions are scrambling for cash. This may then even bring value stocks and precious metals further down, and yes, also Bitcoin in my opinion. Same reason, people need cash, forced liquidations, margin calls, not even speaking about potential further sanctions against Bitcoin holders since Russia claimed to be open to sell Gas for BTC and/or Gold…
Therefore, I think, it will not yet be Gates’ turn… he will need to wait until autumn hits Europe, to come with his next scamdemic…
But I guess/think, it will be the military industrial complex’ turn together with Ukraine and Russia, allegiance to the Great Reset Agenda 2030 to blow things up in between, allowing then central banks again to ‘print’ extra fiat currency and let their buddies who are nearest, buy up stuff for cents on the USD with freshly counterfeited currency (eg. Blackrock, Vanguard, …) while locking up citizens once more in their own home for their ‘safety and security’.
The narrative is also changing towards Climate Change. All those extra casualties we are seeing in top athletes and young to less young but not old age groups are obviously not to related to the ‘vaccine’ craze. They are due to Post LockDown Stress Syndrome and Climate Change. That is where they are changing the new Great Narrative towards.
Anyways, I digress, let’s see how to protect our portfolio.
First of all
We are selling 50% of our blockchain exposure, bringing it back to max 10%.
We keep 5% in Rubble Cash (to potentially profit from a spike in the Rubble and have cash available to buy more value stocks if that correction happens over the next 3 months)
We use the other 5% of freed up cash to buy call options on the ETF QID (ProShares UltraShort QQQ).
We buy the call option with Expiration in July 2022, execution price 16 USD, at a premium of 1.1 USD or better. This means, that if you buy one of such an option contract you will spend 1.1 USD *100 = 110 USD per contract (excluding transaction costs).
On a portfolio of 10.000 USD, 5 % = 500 USD, so we buy about 5 contracts per 10.000 USD.
So, if the Nasdaq would go down by 20% between now and the expiration day, we should expect the QID to go up about 40%, bringing us towards a target of 6.8 USD + 16 USD = 22.8 USD at least.
The sooner this happens the more we can expect (more than 6.8 USD as a premium).
In the case of a 20% drop of the Nasdaq, each contract we would make us 680-110 = 570 USD, times 5 (since we buy 5 call contracts) = 2850 USD and add that to our cash position when we cash out (and maybe re-invest in battered down value stocks…).
To run breakeven, we must be at 1.1 (premium we pay) + 16 (execution price) = 17.1 USD for QID, by expiration date (15th of July 2022). In fact, just a tad higher than 17.1 USD, since we need to cover for our transaction costs.
If by expiration date, QID would be lower than 16 USD, we will have lost 5% of our portfolio value. But that is fine since it means there was no correction, and our portfolio should have performed well to compensate for this insurance fee we are glad to pay for peace of mind.
I am expecting Gold to fall back to the 1860 USD area, and Silver back to somewhere around 21 USD potentially.
Bitcoin could easily fall back to just under 30.000 USD. Worst case BTC could drop towards 21.000 USD, but that I find this unlikely over the next 3 months… maybe later this year, if or should I say when the next scamdemic is released upon the population.