Oil seems to have gone non-Euclidean for the moment. But negative commodity futures = opportunity for level heads. The world needs energy. Oil doesn’t rot and is a long-term counter-inflationary play. Watch USO, DBO, XOM, RDS-B.
F – longer term, but watch the big 3 automakers. Or I should say pick-up truck makers. While debt and even medium-term demand is a major concern, Ford is a strong candidate for a bailout. If you agree, then ask this: after what we’ve seen with this pandemic, post-lock-down behavior with oil at historic lows is going to increase or decrease the sentiment that having a vehicle that off-roads, tows, and handles its own deliveries is the rational choice? I drive a mainstream SUV and have a small garage and it has me reconsidering my next vehicle. Update: pick-ups overtake sedans for first-time ever.
DBA – agriculture continues its multi-year lows. But now instead of world riding high on glitzy efficiency, we have grocery stores out of all flour (except the gluten-free stuff – so funny that), limiting meat purchases, livestock producers slaughtering chickens due to worker shortages, and countries cutting their exports. Enter any hint of real inflation and tell me that food doesn’t become front and center again.
SLVP – Silver miners. Gold too, but it’s still elevated from 2008. Silver looks like a value play comparatively. SLVP avoids worries about running out of physical metal or transfers since the miners are literally digging metal out of the ground. There are other ETFs, but this SLVP also grants some exposure to gold as well and still looks like a bargain….for now. Silver also servers as a double hedge: if the economy rebounds, industrial silver usage should increase. If the economy crashes enough for major financial shocks, silver protects against inflation.