1998/99 tech stock values are rising at unbelievable rates even though very few were profitable.  There was even talk of not needing profits any longer.  It was a new world.  Then in 2000 the bubble burst.

Snap, the parent of Snapchat, introduced their public offering today to complete adulation.  In spite of the fact that investors in Snap will have no voting rights.  You heard me right, investors will get no say in the running of the company.  The founders have complete control of the company.

Snap has also never been profitable and the CEO has indicated that he is not sure if they will be.  The public offering has made him a multi billionaire anyway and investors are falling over themselves to own shares.

When company fundamentals start becoming unreasonable and more importantly people accepting it…watch out.

We still are believers in the growth & opportunities the US economy will offer over the next few years, but we recommend being very selective in how you allocate your investments.  Ride the wave, but be wary of dangers below the surface.

Since the beginning of the year, oil has been stuck in a very tight trading range.

Defying everyone’s expectations, OPEC has successfully gotten members to follow through on production cuts. It has put a floor under oil prices, but the ability of American shale producers to boost production quickly has countered to keep a lid on prices.

It has been painful, but American shale producers have found ways to bring down the cost of exploration and are typically profitable even at the current levels and are showing staying power.

Prices are projected all the way through 2021 that are either flat or slightly lower. While I feel for my friends in Alaska, overall this is great for America. Consumers get a break at the pump and factories have an advantage over their competitors overseas.

Subdued energy costs are a huge tool in process of developing the next economic boom.

The IMF, Germany & Greece continue to disagree over the next steps relating to the Greek bailout.

For Memos, Anthony, your churches and our friends in Greece, we encourage our followers to pray for you.

While there have been numerous (and legitimate) concerns on all sides, the bottom line is that the situation is unsustainable.

The middle ground seems to be that as Greece “proves faithful”, then some level of their debt would be forgiven. Unfortunately Germany is strenuously fighting under the belief of fiscal austerity.

You may think you are facing challenges, those under 30 are facing over 50% unemployment.

BUT, in Memos’ church when someone loses a job…the church prays. And they get a better job!

One of the results of the great recession, as it has become known as, is a trend towards a healthier financial state for the American middle class.

At the beginning of the recession it was obvious that American’s were saving more and putting a greater emphasis paying down their debt.

For quite some time we were unsure of whether this was a trend or a temporary emotional reaction. Eight years after the initial meltdown, the evidence continues to indicate a significant cultural shift.

American’s continue to save more, strive to eliminate their debt and are more judicious in their spending.

As a side note, a recent survey found that 25% of families say they are now debt free. That is up from 14% just a few years ago.

To Brexit or not to Brexit, that is the question

Having just returned from the UK, by my informal survey the exit vote has the momentum.

The voices arguing for remain are focusing on potential economic fallout. What they seem to miss is that after the great recession, people don’t feel like the economy is amazing.

More importantly the British public is more concerned with the free movement within the EU. The perception is that this allows immigrants to come in and claim benefits as well as leaving an open door for Islamic terrorists to make their way to England.

An out vote would still require a 2 year negotiation of new terms before Great Britain left.

Until the vote is concluded next week, prepare for potential volatility.