Warren Buffett: “In the short run, the market is a voting machine. In the long run, it is a weighing machine.” What does that mean? It means it’s a popularity contest short term; long term it is always about absolute value.
OK. Right now, tech is vastly, and I mean VASTLY outperforming everything else. DO NOT GET SUCKED IN. There is a crash coming in tech. I’d guess within six months, more likely earlier. Period. It’s a suckers game.
Small banks are cheap right now. I can see a double in two years, easy. I can see a triple in five years or less. I wouldn’t necessary sell at that point, but I might lower positions. Things will grow back to normalcy.
There is no reason to think tech is worth these levels. And, every reason to buy small banks for their dividends AND significant capital appreciation long term.
I history is any judge, about the time tech crashes (I think it will this year) small banks will run. Buy now, DON’T SELL LATER. It will be the first wave for these stocks. I think they can be owned for 20 or 30 years with little adjustment in your portfolio. Biggest questions will be related to what I buy new when one bank is bought for cash by another.
Scattered Showers and Quicksand 