Date: 12/20/2021
Author: Kent Moors, Ph.D.
Last week was the second time in less than a month that I traveled to advise global private investors on where they intend to place their money. All of these folks are outside the US and take a decidedly more international view on profits than their American equivalents.
Usually, what I garner from these sessions has little immediate use for retail investors. The big boys invest in private initiatives primarily providing no access to average individual investors trading stocks and bonds. In other words, just about everybody reading this Classified Intelligence Brief.
In those unusual occurrences when there might be something to impact how CIB readers invest, there is an additional problem. The intel received can be considered inside information since, while the information is rarely from the company whose stock is about to be affected, it still comprises something that will have a material bearing on an equity valuation and not available from public sources.
However, there are a few times in which the pending move signals a trend or broader indicator of where the private folks are moving. And this, in turn, can provide an advantage for market analyses that does dovetail with where you can put your money.
This is taking shape over my last several trips and comprises some interesting new insight into where the first wave of money is moving in the latest revisions of deep-pocket investment interest.
Initially, there are two overarching elements.
First is the amount of funds involved. It is important to note here that the totals below involve only the aggregate financing available for commitments by the groups I advise.
There is no question this is growing, and private investment is rising faster than investment as a whole. That almost always tends to be the case in an environment in which new directions are emerging.
These are my personal calculations extrapolated over the past four years from where these clients are moving. It is interesting as well to observe that the pandemic has not lessened the growth of this funding. Additionally, the $280 billion in available leveraged commitments from these investors expected by the end of this year is probably a conservative figure. The rise in new uses of derivative paper (on which I have been commenting recently) will in all likelihood balloon this figure.
PRIVATE INVESTMENT LEVELS US$B:
RAW AND LEVERAGED
Second, the departure in this private investment from more traditional approaches is graphically illustrated once the scope of the investment is considered. Whereas conventional investment focuses upon some insular objective: a project, a company, or perhaps financial product, this new investment strategy emphasizes multiple related targets pursued simultaneously.
The objects of interest here include at least these: projects; companies; production volume (as contained in swaps, futures contracts, arbitrage, hedges); debt; collateralization; and new generations of synthetic paper and derivatives.
I have referred to this as investment “layering” in applications over the past several years, after first announcing the approach at the 2015 gathering of the Windsor Energy Consultation at Windsor Castle outside London.
Investments using the layering approach have in all cases improved the overall profitability. In other words, a concerted approach across multiple objectives improves the return over selecting a single target. In some cases, this has even served as a useful internal hedging device (with one target serving to offset lowered expectations in another).
PRIVATE INVESTMENT “LAYERING”
As of this writing, and the results of the market analyses I have provided to these clients in the orchestration of strategic investment decisions, these are the main investment sectors into which private sources are moving acquisition commitments: (1) carefully selected conventional crude oil and natural gas production fields, as well as the futures and derivative paper trading in product; (2) crypto market making and administrative service providers utilizing crypto currency in both collateral and derivative paper applications; (3) next stage battery and storage technology, including the expanding used battery recycling market; (4) mining and processing of lithium and rare earth metals; (5) global cross border market production and distribution in steel, copper, and platinum/palladium; (6) selected electric vehicle (EV) manufacturers with particular emphasis on “last mile” commercial and passenger delivery; (7) bio transport fuels; and (8) the consolidation of banking and financial services as applied to the availability of credit lines for developing goods and services.
Some of these investments are already underway, with most applying some version of the layering approach. They allow an early window upon trends in global private investing and have introduced a few new “hit lists” of publicly traded companies against which I am applying the Σ Algorithm trading system filters.
As retail investment opportunities emerge, they will be released to Sigma Trader and PRISM Profits subscribers.
Dr. Kent Moors
This is an installment of Classified Intelligence Brief, your guide to what’s really happening behind the headlines… and how to profit from it. Dr. Kent Moors served the United States for 30 years as one of the most highly decorated intelligence operatives alive today (including THREE Presidential commendations).
After moving through the inner circles of royalty, oligarchs, billionaires, and the uber-rich, he discovered some of the most important secrets regarding finance, geo-politics, and business. As a result, he built one of the most impressive rolodexes in the world. His insights and network of contacts took him from a Vietnam veteran to becoming one of the globe’s most sought after consultants, with clients including six of the largest energy companies and the United States government.
Now, Dr. Moors is sharing his proprietary research every week…knowledge filtered through his decades as an internationally recognized professor and scholar, intelligence operative, business consultant, investor, and geo-political “troubleshooter.” This publication is designed to give you an insider’s view of what is really happening on the geo-political stage.
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