You now have the best opportunity in 13 years to buy technology stocks.
Amazon is now selling for just over three times its annual sales. Paypal is in the toilet. Nvidia is priced below where it was after it split 4:1. Chinese stocks are down for the count.
Now is the time to get in. Here’s why.
The reason tech fell is inflation. Rising prices lead to rising interest rates. Money costs money. That means growth and even earnings are discounted.
But tech can whip inflation now. Tech has been whipping inflation for over 40 years. Wall Street thinks Paul Volcker did it by raising interest rates in the late 1970s.
It was tech.
Software makes people efficient. Software makes people redundant. Software can untangle supply chains. Software can replace expensive inputs with less expensive ones. Software can be written once, run in the cloud and gain scaled, global distribution for practically nothing.
Software saves energy. Clouds take less energy than data centers did. The iPhone you buy today takes less energy than the iPod you bought in the 2000s did. Batteries on our devices didn’t get more powerful. The devices are using less energy. We don’t need 120 volts. We can get by with 6.
Software even let us design cheap machines that make energy. Oil companies lie when they say they produce “energy.” They don’t. They produce fuel, which machines turn into energy. Solar panels and wind turbines are machines that produce energy, harvesting it from the air and light.
Moore’s Law spreads out in every direction, forcing deflation on everything it touches. Moore’s Law makes science more efficient. It lets us replace oil. It lets us put intelligence into everything we use. It lets us treat DNA as a Programming Language. These things are just getting started.
Start with big tech companies that are already profitable. Then move down the stack into chips, into software, and then into leading edge technologies like biotech, which is where the next generation’s Elon Musk will come from.
You may never get another chance like this.
