Unintended consequences ? = Musings about the world (and my small cap "new" portfolio)

Remember this is NOT investment advice. Do your own research. Just sharing some broad brush ideas.

Let me outline my hypothesis or "end game":

1. The developed world has too much debts. End game is yield curve control. A natural consequence is currency debasement. This forward path is almost inevitable unless there is an unexpected "Paul Volcker" in Warsh. Japan offers a preview on what is to come.

2. AI is probably a big deal in the long run. But I have seen nothing to suggest that we won't see a replay of the internet bubble in 2000 (and the subsequent nuclear winter). The audacity of the latest SB Energy IPO in USA is a sight to behold. Also don't trust anyone who sounds "certain" on their AI thesis. I wouldn't. Too many moving parts for mere mortals to figure out e.g. OpenAI/Anthropic vs. open models, Nvidia financing its customers, OpenAI/Anthropic growth/profitability trajectory.

3. The world is on the cusp of change. Demand for real assets/commodities are going to inflect. Think countries re-arming. Think lack of trust or USD losing its reserve status. Think of the decade+ under investment in commodity supply. Think inflation picking up. See Pic 1. The commodity index has gone nowhere for 20 years.

4. Growth will increasingly become scarce, especially after the upcoming AI-capX bust. Questions for investors is to figure out what is coming next ?

5. Global capital flow will de-allocate from USA. My geographical bets remain China (macro is clearly weak but what is unique about the Chinese stock market is plenty of new businesses), and Latam/Brazil (1990s = Latam was the best performing equities market, riding rising commodity prices).

What does it mean ? These are the themes I am betting on.

1. Gold. Recently, US treasury intervened in the FX market to support the ¥ by selling €. Kind of funny come to think of it. The 3 major currencies in the world all have issues of their own.

2. Bitcoin. Currency debasement + artificially "suppressed" interest rate will drive demand for Bitcoin. Plus halving in April 2028 as catalyst.

3. Junior miners. Sector has been overlooked for so long. Risk / reward is highly prospective.

4. Healthcare. New drug + new technology can deliver growth even when macro is sluggish.

I have recently put together a "new/incremental" small/micro cap portfolio. I still have many existing positions (just look at previous posts). It is not your conventional list of stocks. Something quirky. Should offer decent upside in coming years (IF thesis is right). Equal weight.

1. Aguia Resources (AGR AU) (Junior miner) (Brazil)

2. West Wits Mining (WWI AU) (Junior miner) (Gold)

3. Harrow (HROW US) (Healthcare)

4. Inter (INTR US) (Brazil)

5. Vinci Compass (VINP US) (Brazil)

6. Tencent Music (1698 HK) (China)

7. Chanjet (1588 HK) (China)

8. Kanzhun (2076 HK) (China)

9. Microport Scientific (Healthcare) (China)

10. Naver (035420 KS) (Korea)

Just time stamping this (1st Sept 26)....

I don't think these stocks need to be traded frequently. Just buy and hold.

Let's come back in 3 years and see if these quirky stocks can beat the market :)