How to Ride the Coming Australian Stock Market Mania
If you think the Chinese travel boom is big, wait until you see the even more exciting one coming — trips to Mars.
Hey, don’t laugh — it could well be in my lifetime, if I hang around long enough.
Elon Musk was out and about last week saying the same thing. This time, he wasn’t talking about his main company — Tesla — but the other one that keeps him just as busy: SpaceX.
Elon Musk says he can get his rockets and people to Mars in the next decade; somewhere between 2022-2024.
Of course, Elon needs to build the most powerful rocket ever — with money it appears he can’t currently guarantee. A writer in The Wall Street Journal says he has the ‘kernel’ of a business plan for it all.
He’ll need a bit more than that — but full marks for having a crack and trying to pull it off.
He’s not alone. Richard Branson has a foot in the industry with Virgin Galactic.
I don’t doubt we’ll get there…
Mars is already in range from today’s tech
About 18 months ago, I read a book by a former Agora Financial colleague.
It was called How We’ll Live on Mars.
A guy called Stephen Petranek wrote it.
He said that humans would reach Mars in about 10 years from now. He also said, in 2015, that the technology to make it happen already existed. The rest was a matter of money and determination.
It sounds insane, but Stephen could be proved right.
Massive US company Lockheed Martin plans to send astronauts to Mars too. Staff were in Adelaide over the weekend saying how it might happen.
Donald Trump is said to want it to happen during his presidency.
This is obviously super exciting. Lockheed Martin isn’t alone in trying to pull this off.
But I will make an investing point from it.
Whenever we hit a true market peak — like in 2007 — something like this will obscure it and fool everyone.
History shows that it’s never obvious to investors when they should be getting their money out of the market — because the future just looks so compelling and so exciting.
In the 1920s, radio and cars and aeroplanes were hot new industries. These were incredible inventions that astonished previous generations.
As the US and China launch into space, I think — and admittedly I’m speculating here — it’s going to have the same affect.
Only the good Lord knows what tech will come in the next decade, except to say it will be staggering.
Imagine it. Humans in space, as tourists and explorers.
There’s a mania coming somewhere in the future
Everyone will be astonished at the achievement. Suddenly there’ll be stories of the mineral wealth we can tap on asteroids, the new jobs in space, and all sorts of wild and bullish comments.
By then, I expect artificial intelligence and robotics to have upended the economy to make today seem as remote as the days of horse carts and top hats.
However, the catch will be that underneath all this, the cycle of boom and bust in markets will not have changed.
I’m not saying this is something to worry about or factor in anytime soon.
But there HAS to be a major market peak somewhere in the future, and it will never, ever be obvious at the time.
My guess is that everyone will be so drenched in windfall gains from stocks, property and — I’m guessing — cryptocurrencies (or at least hearing about them) that a collapse will be inconceivable.
That will be when the market is at its weakest. There’ll be no one left to buy by then.
All the bears and the doomsayers will be long dead, bankrupt, or laughed out of town.
Developments in space could be the trigger that sends things right over the top. If Stephen is right, a 2027 bear market could be a doozy investors remember for a lifetime.
If you’re familiar with some of my previous work with Phil Anderson, you’ll also know 2026 is on track for a major peak in the world economy.
There’s a lot of water to go under the bridge in the meantime, but we’ll be well served to keep an eye on space developments.
Certainly, the psychology of investors is due to switch from the fear of loss to the fear of missing out.
Because the technological advances are coming so fast now.
I can’t prove it, but it seems to me the Aussie stock market is beginning to heat up. You can’t see it if you follow the main index and the top companies.
But some of the small cap stocks are really firing.
This is especially true for software companies that can streamline the paper and pencil operations of the slow behemoths above them.
They’re on track to grow fast, or be bought up. I tell you, the time to be going over these businesses is now.
Editor, The Daily Reckoning Australia