Quantum Wealth Summary

 

  • Meta Platforms/Facebook [NASDAQ:FB] is usually considered a dependable tech investment in many stock portfolios
  • Yet it suffered the worst ever one-day plunge ever on February 3rd
  • Is this a one-off black-swan event — or a symptom of wider discontent brewing in the markets?
  • Here’s how value-driven investors can cleverly sidestep such turbulence and prosper by thinking differently

 

 

Just imagine this.

What if you had your finger on the pulse of every market in the world?

What if you owned 1.5% of every listed company in existence?

Would this put pressure on you to be smarter and more adaptable than everyone else?

 

Source: Norges Bank Investment Management

 

Well, Nicolai Tangen is the man who finds himself in such a position. He’s the CEO of Norway’s Government Pension Fund Global — also known as the Oil Fund.

Here are some intriguing facts about this sovereign fund:

  • It is considered the largest of its kind in the world
  • It is valued at $1.3 trillion
  • It holds a diversified global portfolio
  • 72.8% is held in stocks
  • 24.7% is held in bonds
  • 2.5% is held in real estate

So, Nicolai Tangen may actually be a ‘one-percenter’. A hedge-fund manager who operates on the upper echelons. If this guy was a military asset, well, he would surely be a Navy SEAL.

At Tangen’s level, because of the enormous asset base he is managing, the opportunities and the risks are that much higher.

You have to remember: Targen is not simply looking after the wealth of millionaire clients. He’s looking after the financial health and happiness of an entire nation. The fate of over 5 million Norwegian citizens hangs in the balance.

So, when Tangen does an analysis and forms an opinion, people tend to listen.

And right now, his biggest concern is persistent inflation:

‘We are seeing it across the board, in more and more places. You saw Ikea increasing prices by 9 per cent, you have seen food prices going up, continued very high freight rates, trucking rates, metals, commodities, energy, gas . . . We’re seeing signs on wages as well.

 

‘How will it pan out? It hits bonds and shares at the same time . . . for the next few years, it will hit both.’

Well, crikey.

Tangen seems to believe that inflation will become a permanent fixture of the global economy. And like a good captain, he’s taking defensive action and steering the Oil Fund in a more value-driven direction.

This is a big deal because the fund is the single largest owner of equities in the global marketplace. And the strategy Tangen chooses to employ will inevitably have a ripple effect.

Of course, there are economists who disagree with Tangen. They think he’s too gloomy, too pessimistic. They say inflation is already close to peaking, and we may soon get past the worst of the pain.

There’s no need to panic — nor get overly defensive.

But here’s the dilemma.

Is inflation really transitory?

What if it’s persistent?

What are the long-term consequences if Nicolai Tangen is actually right?