Priced for Perfection

[Inside Wall Street with Nomi Prins]( Priced for Perfection By Clint Brewer, Analyst, Rogue Economics Growth and technology stocks are priced for perfection. And that leaves them vulnerable to any missteps. Just look at Apple last Friday. After an impressive 51% run higher this year, the company shed $160 billion in market value in a single day. That one-day loss is more than the entire market capitalization of General Motors and Ford combined. The sudden implosion followed Apple’s latest earnings report, where a disappointing outlook has analysts expecting just a 1% increase in earnings per share this year. That’s not going to cut it when Apple’s valuation was 53% higher than the S&P 500. And it’s not just Apple. Just look at the tech sector overall. Compared to other sectors in the S&P 500, tech trades at the biggest valuation premium to its own historical average. In other words, we could say it’s the most expensive sector in the market. It’s trading 55% higher compared to its historical average. And for tech stocks, there’s another threat on the horizon… one that leaves the most overvalued companies vulnerable. And it’s something they have no control over. Recommended Link [“Amazon Loophole” Allows You to Collect Up to $28,544 Starting September 10th]( [image]( These folks got it made! Thanks to a little-known IRS loophole… They are collecting huge payouts from government-regulated “royalty programs”... every single year! [“Started from a zero balance... Just hit $1,200 a month in [royalties].” – Neil P.]( Like Neil P., who is now collecting $1,200 a month in “royalties.” [“Increased my [royalties] to over $30,000 last year.” – Tom K.]( Tom K. reports he’s making $30,000 a year! [“Increased my [royalties] from about $2,000 to $60,000…” – Elaine T.]( And Elaine T. boosted her payouts to $60,000 per year! If you want to participate, you’d better hurry. The next payout is scheduled for September 10th. [Learn how to collect your first payout before September 10th.]( *Verified review. Past performance does not guarantee future results. -- Interest Rates Threaten Valuations I’m talking about rising interest rates. Interest rates have been a hot topic this year. The Federal Reserve has jacked up short-term interest rates to the highest level in more than 15 years. It’s a symptom of The Great Distortion, which Inside Wall Street editor Nomi Prins has been warning about. But longer-term rates like the 10-year Treasury yield are rising as well, and that has major implications for both the stock market and the economy. Here’s why… Higher interest rates make future corporate profits worth less in today’s dollars. And for many growth and tech stocks, their earnings potential lies far ahead in the future. So tech stocks that are priced for perfection need to deliver on lofty growth outlooks. While, at the same time, rising interest rates keep eating into their valuations. It’s a double whammy. Here’s more proof. Of all the sectors in the S&P 500, the tech sector has the second-highest negative correlation to Treasury yields. That means tech stocks tend to rise when interest rates are falling. And they tend to fall when rates are rising, like they are now. That makes tech stocks’ share prices susceptible to higher rates. Recommended Link [“One-Stock Millionaire” Trades ONE Stock for 3 Decades… Wins In Any Market]( [image]( Jeff Clark here… I’ve joined the ranks of the top 1% of wealthy Americans… by IGNORING 99% of the entire stock market. Among 6,000 different stocks on the market to choose from… Hides ONE incredibly special stock. I call it, [“The One-Stock Retirement”]( because I’ve used it for over 3-decades (through ANY market) closing huge gains – time and time again. Trading this ONE stock over and over again is changing the lives of everyday folks across the world – from school teachers to doctors. You do not need trading experience and you can [get started with only $100!]( [Click Here to Learn More About My Secret.]( -- Tech Stocks Don’t Want This Breakout If there’s one thing that can quickly deflate tech valuations, it’s a rapid rise in interest rates. And the recent action in the 10-year U.S. Treasury yield isn’t helping. The 10-year yield has climbed back above 4%, as you can see in the chart below. [Chart] That puts the 10-year right back to levels from last October, when the S&P 500 was still in the bear market’s grip. A breakout above last year’s peak could be the catalyst that squashes the rally in 2023’s big tech winners as higher interest rates pressure the overvalued tech sector. Recommended Link [PhD Economist: “Almost out of cash…”]( [image]( Will you turn in your cash? Soon, Americans may have a decision to make – Turn in your cash – or let it expire worthless. According to Dr. Nomi Prins, a pile of smoking-gun documents she’s unearthed, and patents prove we’re on the verge of a complete transformation of our money supply. She says: “The rules are about to change forever. If it plays out the way I expect, cash could become a target as more banks fail and run out of money.” Dr. Prins has recorded a full-length interview to explain the connection between cash and bank failures – and what it means for your money. What she has to say is controversial, but if you have more than $2,500 in an American bank or retirement fund – Nomi’s message is something you absolutely cannot afford to miss. [Click here to find out what you need to do to prepare for this historic transformation.]( -- What This Means for Your Money Here’s what that means if you have any money in the markets… or are looking to deploy cash sitting on the sidelines. You should be careful with new purchases of this year’s big gainers in the growth and tech sector, like in some artificial intelligence (AI) stocks. You’ve already seen the disappointment in Apple’s share price after a low growth outlook, while I [highlighted Nvidia’s sky-high valuation last week](. It’s tempting to chase the highflyers but do your homework before adding a position. In particular, avoid tech stocks whose share prices have surged on AI-driven hopes but have gone too far too fast. They could be susceptible to overvaluation and rising rates. Three stocks that I would avoid right now are: - Nvidia (NVDA) - Super Micro Computer (SMCI) - C3.ai (AI) Also, pay attention to interest rates. No matter how promising a company’s prospects, a breakout in the 10-year Treasury yield could deflate tech valuations across the sector. Best regards, Clint Brewer Analyst, Rogue Economics P.S. There’s only one sector in the S&P 500 trading at a valuation well below its 20-year historical average. It’s the [same sector that 21 billionaires are piling billions into](. Guys like Elon Musk, Ray Dalio, and Warren Buffett… Editor Nomi Prins believes they’re getting ready for a rare market event. It’s set to hit on September 20. And folks who prepare now could have the chance to secure a seven-figure nest egg… While those who don’t could have their portfolios cut in half. [Watch her latest video briefing for all the details](. --------------------------------------------------------------- Like what you’re reading? Send your thoughts to [feedback@rogueeconomics.com](mailto:feedback@rogueeconomics.com?subject=RE: Inside Wall Street Feedback). MAILBAG Have you invested in any tech stocks this year? If so, what’s your experience been like? Have you tried chasing any of the highflyers? Write us at [feedback@rogueeconomics.com](mailto:feedback@rogueeconomics.com?subject=RE: Inside Wall Street Feedback). IN CASE YOU MISSED IT… Market Wizard Reveals: [The One Ticker Retirement Plan]( Introducing the “One Ticker Retirement Plan”… It’s a way to trade just one ticker… And potentially make all the money you need – no matter what happens in the stock market. Sounds too good to be true? [Larry reveals everything in this interview – including the name of the ticker you need to get started.]( [image]( [Rogue Economincs]( Rogue Economics 55 NE 5th Avenue, Delray Beach, FL 33483 [www.rogueeconomics.com]( [Tweet]( [TWITTER]( To ensure our emails continue reaching your inbox, please [add our email address]( to your address book. This editorial email containing advertisements was sent to {EMAIL} because you subscribed to this service. To stop receiving these emails, click [here](. Rogue Economics welcomes your feedback and questions. 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