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When you look at market dynamics, say, stocks, commodities, or real estate, everything matters. Do you understand? Because we live in a global economy with international capital flows. So money flows in this direction, then that , then up, then down, and so on. Therefore, everything matters. But frankly, for the stock market in its current form and nature, which is highly speculative, the main factor that affects stock prices is the amount of money that central banks print, not whether there is a war in the Middle East.
Although I think the war in the Middle East could escalate and become a bigger problem. It is possible. According to fundamental indicators, long-term, in my opinion, oil will grow or should grow. But in the short term, there are possible demand disruptions because prices are too high, so people drive less or consume less energy.
And during a recession, demand for oil decreases, etc. And as you know, in all markets there are people who buy and sell, and they have their own purpose. They provide a village or city with energy. So, I buy oil, I'm a professional trader. I buy oil and sell it to people who need it. But this is relatively little in the world of what I call real economic activity.
What 's big, and that's why it's hard to analyze, is the speculative money circulating around that central banks have printed. This is why printing money leads to high volatility in the markets. And, in my opinion, it is difficult to say whether speculators will exit the market or, on the contrary, enter even more?
It seems to me that the price of oil at this level is not too expensive, all things considered. It's probably cheaper than gold. No one knows for sure what the price will be in a year. But I would answer your question yes. Let's say you are an individual investor. You have, let's say, a hundred million or a hundred thousand, that's your liquidity and assets, and you ask me, " Mark, what should I buy with this hundred or a hundred thousand, or a million, or a hundred billion?" Then I would advise you to buy stocks because in the long run stocks tend to perform the best of any investment class, better than bonds, cash or real estate, if invested in good enough companies.
Because then we would have to define what a good enough company is. Do you understand? It is an endless process. But I'm just saying that it's worth owning stocks and cash because it allows me to buy something attractive when I see it. Also, I would own real estate because I think it gives people peace of mind to have their own home, and you can happily choose exactly the one you want.
You don't have to buy a house, because we don't live under socialism or communism, where the state says where you should live . No, we can choose for ourselves. Then, the third option is to own stocks through, say, an index fund, or choose 10 or 20 good companies to buy such a basket. Or some people buy just one share and so on.
So everyone has to decide for themselves, and my opinion is that you should have some precious metals , not just dollars. I prefer precious metals because they cannot be reprinted. But, as I mentioned last time, precious metals can come under pressure if people need liquidity and start selling them.
However, in general, I believe that you and your viewers should buy some metals not just once, but every month. You shouldn't put all your money in metals, but if you have a hundred, I would put maybe 25 in them. I think platinum will show better results, maybe silver too, but I own mostly gold. But as an investor, I don't just buy what I think will yield the highest return.
You know, when I look at my portfolio, I have different companies there. I like companies that pay, say, regular dividends of 7% and can grow a little, for example, by 3-4% each year. And the dividend yield is quite enough for me. I have modest ambitions in life. I believe that mining stocks are more volatile, and, let's say, gold, silver, and platinum are at their lowest levels right now.
I would prefer them to fall even lower, say 20%, but that may not happen. But if you believe in a bull market, then I am convinced that silver and platinum will outperform gold. However, I am not going to change my position in gold for silver or platinum. I am happy with what I have. I will be happy if gold does not fall in price.
This is my point of view. Well, I think the average person is largely clueless right now. In other words, he faces many challenges as governments now, especially in the US, favor the super-rich. In other words, to asset owners. Do you understand? When you print money, the only thing that has happened in the history of every society is that the poor and the middle class lose out, and wealth is concentrated in the hands of a handful of people, not many, say 20-50 people.
They then control huge companies, have enormous influence; it's very centralized. And this is what we see in the stock market as well. We don't have a broad market rally. We have a rally of, say, 50 stocks in America, then two stocks in South Korea, three stocks in Taiwan and so on, but it's not a broad base.
And I believe that there is an opportunity for an investor to buy what is being overlooked. In other words, speculators focus on Nvidia, Tesla, Micron Technology, etc., but the broader market, especially emerging markets, offers many inexpensive stocks. But I must say that inexpensiveness is relative to something that is very expensive.
They themselves are not that cheap. In some cases, they are cheap compared to bond yields, because some bonds yield, say, 2%, and stocks yield, say, 7% in dividends. Then stocks are relatively cheap compared to bonds. And some bonds are relatively cheap compared to stocks because they yield, say, in America, 10-year Treasury bonds, say, over 5%.
Maybe it's not such a bad idea compared to Nvidia or Micron Technology, you know? So I'm not saying it's harder now than it used to be , but I believe an active fund manager will perform better than index funds. This is my point of view. Maybe, but yeah, in the long run, I think they will grow because they haven't grown enough.
And the Fed kept interest rates artificially low. But it's entirely possible that bonds will outperform stocks over the next few months. It's funny to me to hear that the US is helping someone. When in the history of the United States has anyone really been helped? Everything they did in foreign policy was aimed at achieving their own goals, some of their own games in which they sought to win, to gain an advantage.
Whether it was the intervention during World War I or World War II, or later during the Suez Crisis, etc., or the interventions in Iraq and Afghanistan —they were not there to help. They were there to gain an advantage. And when I analyze whether I would want to live in a country controlled by, say, China, Russia, or the United States, I think I would choose the United States , because they are so disorganized that it would be quite difficult for them to control you. They can try to do it, but I think it will be quite difficult.
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