This big poker move just lit a fire under the metals

Hello, reader.

Imagine you are playing cards at a casino. You’re in the middle of a cash game of Texas Hold’em, and the round has come down to just two people: you and a player who has been harassing everyone else all night.

Your opponent moves all-in, revealing the two kings in his hand. He shoves $200 into the middle of the table, increasing the pot to $2,000.

Swallow. Common books write JQK-5, which means it has a three-in-a-kind. (In this version of poker, he can combine his two kings with the third communal king to make a strong final hand.)

The bottom line here is that the card game is complex. The best professional poker players don’t just play mathematical odds…they watch what everyone else is doing and use those observations to adjust their views. This is why you’ll see top poker players watching other people at the table and how many seem to “know” what’s in everyone’s hands.

The same is true of global macroeconomic investments.

Instead, the key to global macro investing is observation and integration all known data points…not just one of them…and to make logical, high-probability inferences from them. Sometimes it can be a complex dance that requires both an eye for detail and a seasoned ability to connect those details into an investable thesis.

Let’s take a look at how this works in practice, using analysis from someone you all know: InvestorPlace Market Analyst Thomas Yeung.

In a recent Fry’s Investment Report weekly update, Tom asked: “Do the goods have a problem with China?”

Several Chinese groups released mixed economic data, and the “mathematical” odds suggested the world of commodities was headed for a bear market. After all, Tom noted, China accounts for more than half of global copper exports and two-thirds of soybeans.

However, Tom said this simplistic view of supply and demand neglected potential interventions by the Chinese central government. These are unexpected “raises” and “bluffs” that the best “poker players” on the world stage can use to influence, well, everything. He wrote…

UBS cut its 2024 Chinese GDP growth target to 4.6% this week, down from a previous forecast of 4.9%…

That means more tax incentives are likely on the way. We expect the Chinese government to focus on the real estate sector, given cooling prices and better fiscal restraint from large developers. The central government had previously announced GDP growth targets of “around” 5%, and slowing property markets will make this the most tempting lever to pull.

Recently, the Chinese government did just that. Not only has China’s central bank cut interest rates… but it has also explicitly taken steps to reduce the cost of existing mortgages. The bank said it would save 50 million households about $21 billion a year. These actions were partly made possible by the Federal Reserve’s key interest rate cut last month, which allowed the Chinese government to add expansionary policies without causing the currency to fall.

It also caused a further increase in commodity prices, especially those related to the construction industry. Copper and aluminum prices have risen anywhere from 3% to 10% since September.

In other words, Tom read China’s hand correctly. Good for him!

And even better for me Fry’s Investment Report betting on commodities. In fact, one of my copper producers—a company that also tested AI—was up 22% in September. And since I first recommended this company in 2020, it has grown almost 300%!

The bottom line is that I still have a bullish outlook on commodity stocks. To learn more about the companies I recommend at Fry’s Investment Report, you can click here to learn more about how to become a member.

Now let’s look at what we covered here Smart money last week…

Smart money Elevate

Our “leaders” don’t talk about AGI, but we must

Artificial intelligence was not on the minds of the presidential and vice presidential candidates, nor were any of the moderators in the few debates I saw. However, it’s all anyone seems to talk about in the real world. The emergence of artificial general intelligence (AGI) is imminent and it is essential to stay informed. Click here to learn more and learn about the opportunities AGI creates.

The ‘expedition’ of self-driving cars… and an even bigger AV bet

In 1994, 27 years old Microsoft product manager Rich Barton presented Bill Gates and other executives with a game-changing idea: What if you could take your travel booking…and move it online? Thus, Expedite he was born. Soon, the same truth will emerge in the world of autonomous vehicles (AVs). And now that Telsa is widely expected to join the AV space, there’s one company that could benefit. Continue reading here.

The only way to get into Elon Musk’s Robotaxi before its 10/10 debut

The era of autonomous vehicles has arrived. In the number of guests on Saturday from Luke Langohe writes about his first-hand experience using Waymo, Alphabet’s self-driving unit. The company is firing on all cylinders, but it’s not alone in defining this eventual reality. Self-driving cars are spreading rapidly, and huge investment opportunities should emerge from all of these changes. Click here to read more.

The two types of self-driving technology every investor should know about

Before the “Epoca Avs” potentially creates a massive payday, it’s important to know how these vehicles actually work to understand the growing megatrend. At its core, there is a combination of sensors: “hardware stack” and “software stack” powered by AI. Together, they enable machines to make informed decisions. For more details on the roles of these software and hardware stacks, click here.

I can’t wait

Over the past week, we’ve been talking a lot about autonomous vehicles here at Smart money.

That’s because on Thursday, Elon Musk is set to unveil his robotaxi to the world at Tesla’s “We, Robot” event. It is a fully automated Cybercab with no mirrors, no pedals and no steering wheel.

And my colleague, tech legend Luke Lango, thinks it could send shares of a little-known vendor up to 20 times higher. Click here for more details in this full video report.

Plus, we’ll continue to dig into this topic here throughout this week…and share ways you can take advantage of it.

Sincerely,

Eric Fry

Editor, Smart money