China Losing Trade War, Plus My Top Stock Pick for New Tech
China is losing everything in this trade war as America rallies on.
But you wouldn’t know it from our doom-and-gloom media headlines.
In today’s video, I show you the facts behind what’s really going on and why I believe the trade war ends this year.
Plus, I give you a look at the unbelievable new technology I’ve just started using and its untold growth story that’s getting ready to unfold. Now is the time to invest.
Watch my video to find out how this tech is revolutionizing entertainment, education, big business and travel.
The great news is this mega trend is just getting started. And I’m giving you my top pick-and-shovel play to buy now, while the biggest gains are still to come.
Bold Profits Daily
September 6, 2019
Hey everyone. This is Ian for Bold Profits and welcome to your Friday market video. This week I am going to be talking about recession fears, all these headlines coming out on the internet and the news. I’m going to be talking about it at a different angle than I have before.
I’ve noticed over the past couple weeks the narrative has changed. Now people aren’t talking about rates as much. First it was rates were too high, then it was that the yield curve was inverted. Now the trade war is front and center as to why we’re going to have a recession this year or next year.
I’ve seen all kinds of articles. One was from Morgan Stanley that said the recession was coming in six to nine months. There was one from UBS that said the trade war is going to put the entire world into a recession within the next couple years. Then there was even one that said the U.S. going into a recession is going to happen even before the trade war is over.
They’re covering all sorts of angles on this, but I want to go over what’s actually happening and why China is getting hurt by this a lot worse than we are. In fact, our economy is still going strong. One of the things people are using against China is their currency has gone down a lot. Compared to the dollar, it’s now cheaper to buy things from China.
The reason this could be bad for us is because it encourages other countries to buy from China rather than the buy from us. But it also weakens the tariff. If their currency is down and their goods are cheaper, but they’re charging us an extra amount on them in the form of a tariff it balances out.
The tariffs aren’t doing as much damage as people think. Another thing really hurting them is the fact a lot of American companies are starting to leave manufacturing in China. They are shifting to other countries right in that same region like Thailand, Singapore, Korea — all these other emerging economies are growing.
They are getting out of China and these are huge companies. We have clothing brands like Steve Madden, Elle Brands, Hasbro — one of the biggest toy companies in the world. Also, a lot of huge tech stocks like Google, Apple, Dell, Nintendo and iRobot. All of these gigantic multi-billion-dollar companies.
When you take all that into account, they are getting hit hard by the trade war. They are taking hundreds of billions of dollars’ worth of goods out of China and they’re making them somewhere else. It loses a lot of business for China, it gets rid of jobs, it gets rid of production. That’s one area they are not going to be able to sustain if we don’t come to an agreement sometime soon.
That’s on top of the fact that people who have done business in China have repeatedly said that China has done things like steal their tech. CNBC has this list of 23 companies in America that do business in China. These are the biggest of the big companies from here that do business over there.
Apple and Google, IBM, GE — huge companies. Seven out of those 23 have reported that China has stolen their technology within the past year alone. That’s a big problem. It’s been going on for quite a while. One of the reasons we are in the trade war to begin with is because they are treating our companies unfairly.
These two reasons are really hurting China’s business. Everybody wants to get out of there now. The IP theft from China actually costs us an estimated $250 billion to $600 billion per year. It’s not cheap. Even though the labor is cheaper there, it’s not cheap when we’re losing billions of dollars because of IP theft.
Now, they’re starting to pay the price for that because people are starting to leave. It’s really started to take a toll on their production. Last month it was reported that they had 4.8% growth in production over the past year. That is the lowest number they have reported since March 2002.
It’s been 17 years since they had something that low. When you’re the biggest exporter in the world and your production is down more than it was during the Great Recession, you’re in trouble. They are trying to scramble to find some way to solve this problem.
Their consumers are getting hit hard too. They had their worst retail sales number in more than 16 years. People are buying less because their unemployment rate is going up and the consumer is unhealthy. As their economy has grown, people have started to do well over there. They are making more money, spending more, kinda like we are here.
But with all these issues, they are losing their jobs and they aren’t able to spend as much. 80% of China’s GDP growth is because of the consumer economy. They really need their people to be out spending and buying things to drive the economy higher and that’s not happening. They’re in a tight spot right now.
Meanwhile, the U.S. economy is still chugging along fine. Our production has been up month-over-month for 13 out of the past 18 months. The reason I used 18 months is because you can say the trade war officially started in February 2018. That was when the first tariff threat was imposed.
It has gotten a lot worse for China and here it’s not too bad. 13 out of 18 months production has grown. That’s the best 18-month period we’ve had since 2013 and 2014 where we were still in the early stages of the recovery from the Great Recession. The fact that we’re still on par with that level of production is pretty encouraging.
You’d never know it by looking at the headlines that are out right now that say we’re about to go into a recession. Another area of our economy that’s surprisingly strong and you would never know about is retail sales. People are still going out and buying things. 22 out of the past 25 months, retail sales have been up.
That is the best streak we’ve had since 1997 through part of 1999. More than two years of amazing consumer economy, which is important for us because it drives two-thirds of our economy. We are at the polar opposite of what China is going through. They are having the worst production and the worst retail sales in almost two decades.
We are having the best consumer economy in more than 20 years and our production is still on par with where it was while we were coming out of the Great Recession. Overall, when you read these headlines and these articles there is so much negativity and so much to make you think we really are headed for a recession.
But when you look at the overall economy, our production, retail sales and housing market are all very strong. We just wanted to let everybody know that we believe the market has a long way to go up. Obviously it’s been really volatile and really shaky for the past month. May was rough and August was rough, but we do believe that this trade war is going to come to an end soon.
We’ll keep everybody updated with that as more comes out. It is in the final stages. It has to be because China can’t let this go on for their economy much longer or they’re going to be in some serious trouble.
For my millennial topic of the week I want to talk about virtual reality (VR). It’s this amazing technology that millennials have caught on to. A lot of people know it as a video game technology, but it’s going to be used for a lot more — it already is. I’ll get into that in a little bit.
I actually just got the new Oculus Quest, the newest headset that has come out. It’s my first time getting a VR headset. I have to say it’s pretty amazing. I haven’t been this excited about a video game system since I was in middle school. It’s been a while since I was into video games. I’m not much of a gamer, as I’ve said before.
But this is a completely different thing. I can see how it’s going to revolutionize a bunch of different ways of living that we are used to doing a certain way. It’s going to make things a lot easier. The Oculus Quest sold out from Amazon, Walmart and New Egg in the first week it was on sale.
The old Oculus Rift was the first one they ever brought to the market in 2016 sold out while it was still in the preorder stage. The first HTC, another big headset maker, sold out very quickly. The PS VR and Oculus’ second headset, Go, sold one million headsets last year. The PS VR is on track to sell 2.2 million headsets this year.
They’re getting extremely popular. There’s a lot of millennials and Gen Z who use these for gaming. But there’s so many other uses. One of the things I’ve used on mine is this app called Wander. It’s basically Google Earth. You can see all these places on a map, you pick a place to go and it shows you a 3D image of someone who took pictures in a circle.
You’re in that circle and you can turnaround 360 degrees and see where you are in the world. It’s in every country you can think of. It’s in Antarctica, North Korea, which obviously is not a great place to get into it. It’s a safe way to see North Korea if you want to. It’s really interesting to see what you can do with this technology.
Actually, one of the top comments on the Wander app was someone who said they were planning their honeymoon and went to the place they were planning on going in the app so they could see what it was like. It actually helped them with basing their decision on what hotel to stay in.
It’s so much more than gaming. With this app you can go anywhere in the world and see what things are like. You can go to places and scope them out and see what you want to do there. It’s really interesting. It’s going to impact the workplace too. Millennials are dead set on having new technology, especially at work.
I saw this survey that said 83% of millennials will base where they work based off the workplace setting and the technology that workplace offers. If they have good technology, millennials are more likely to work for you. There’s another survey by Nielsen that found 74% of millennials feel new technology makes their life easier, 54% feel it brings them closer to friends and family.
I can personally attest to that. I love talking to my parents about new tech, especially things like VR. I have been talking about that to them for a while now and trying to convince some of my friends about the future of VR. I think they are slowly starting to believe me because of all the article I send them.
The only way to be able to tell the potential of VR is trying it. If you don’t have a VR headset, I do recommend you try it. There are places you can go to use VR where you don’t have to buy it. It’s a really cool experience. It has a big say in where millennials want to work. A lot of millennials want to work remotely.
With VR, you can call into a conference call and have meetings. They are already doing this at a lot of companies. Honeywell uses VR, UPS is using it for their drivers to get practice driving their trucks. It’s amazing what you can do with simulators and VR technology too. You can make it so you’re driving a truck.
Walmart is using this in 200 of their training academies. They have these big complexes where they train employees and they’re using it for customer service. They can have a whole Walmart store simulated. They can go all over the store, learn where everything is, have interactions with customers. It’s like being there in real life.
It’s amazing that Walmart is investing in this to train their employees. That really says something. Same with Honeywell and UPS. These are really big companies that trust this technology. They are finding it helps train their employees. More and more we’re going to see newer companies adopt this technology too.
They don’t really have a choice. If you want to survive as millennials continue to take a bigger share of the workforce and you want to have a happy staff of employees, you’re going to have new technology like VR to assist with the everyday tasks of working. You can use it for conference calls, meetings and things like that.
We’re also seeing it in education. There’s a software called RoOomy that’s used for conference calls and also used for education. Harvard is using it, a college in China is using it and it’s gotten a lot of positive feedback. Those aren’t the only two colleges using it, but they are some of the world’s best schools.
You’d think they’d be the ones to get this technology early because they want to maintain that top-tier status. They know that people like VR and want to use whatever technology is new and good. They are having a lot of positive experiences with it.
I took online classes a couple summers. It’s like you’re not even taking a class. It’s like someone shoving a bunch of work in your face through a computer screen. There’s no structure to it, but if you do it through VR you can be in a real classroom with students, a teacher and a classroom. It’s completely different than what an online class always has been.
If you’re doing it like I did it, you do all the work in the last week. Take the final on the very last day and cram it all in the last week. You don’t really retain anything by doing that. I think VR is the way to take classes. I can see it becoming extremely popular down the road. RoOmy software is a good proponent of that.
They’re one of the first company’s I’ve seen that’s really taken this to the level they have. They are in some of the best colleges of the world. The technology is taking over many aspects of the way we live. We never even fathomed having a VR classroom or training Walmart employees with VR. 20 years ago, it would have been laughable.
VR was out 20 years ago. It was primitive and wasn’t anything like it is today. We’re finally at the point where we’re starting to disrupt these major industries that we know and live with every day — our jobs, our education. The whole point is, millennials love technology. VR can be used in so many ways.
We really are starting to see a widespread adoption of that. To invest in VR there’s not many options available in the market. There’s some picks and shovels places — the companies that make components for the headsets or a couple companies that make the headsets, but it’s not their whole business.
To invest in this, I would recommend buying shares of a video game ETF. It started out as a VR/AR ETF, but I think it didn’t catch on that way. The public perceives VR as video games, so it got changed to a video game ETF, but it’s still a great way to invest in VR because it’s full of companies that make things that have to do with VR.
They make all the components and parts of the headsets, the software and the technology. It’s the Defiance Next Gen Video Gaming ETF (NYSE: VIDG). That is how I would recommend getting in this technology at this time. Down the road, as these startups that are specializing in VR start to go public, there will be more options.
Getting in early is really important. That’s how I would recommend doing that. That’s all I have for this week. This is Ian Dyer for Bold Profits. Happy Friday and have a great weekend.
Editor, Rapid Profit Trader