Postcards: Republically Speaking... It's Small Caps' Time

Let's breakdown the rest of the week before I start this terrifying diet and exercise program. ͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­͏   ­ Forwarded this email? [Subscribe here]() for more You are a free subscriber to Postcards from the Florida Republic. To upgrade to paid and receive the daily Republic Risk Letter, [subscribe here](. --------------------------------------------------------------- [Postcards: Republically Speaking... It's Small Caps' Time]( Let's breakdown the rest of the week before I start this terrifying diet and exercise program. [Garrett {NAME}](floridarepublic) Jul 15 floridarepublic   [READ IN APP](   [Republic Risk Readers, Go Here Today]( Today’s issue of Republic Risk is in the link above… --------------------------------------------------------------- Dear Fellow Expat: Let’s get to some Republic speak first… shall we? On July 18, Dallas Federal Reserve Bank President Lorie Logan, San Francisco Federal Reserve Bank President Mary Daly, and Federal Reserve Board Governor Michelle Bowman all speak… They are all participating in an event called: "Exploring Conventional Bank Funding Regimes in an Unconventional World." This suggests that they’ll focus on how traditional banking methods and funding structures adapt or need to adapt in response to modern, unpredictable global economic and financial environments. Now… the Republic Speak… Welcome to another exercise in futility, where the so-called financial "experts" gather to discuss how to patch up a fundamentally flawed system. In this event, we’ll witness central bankers and regulatory enthusiasts patting themselves on the back for their latest interventions, bailouts, and artificial interest rate manipulations, which have done little more than prop up zombie banks and delay the inevitable reckoning. Why is Mary Daly… the woman who oversaw the banking crisis on the West Coast last year… still in charge of the San Francisco Fed. Someone make it make sense!!! Expect plenty of jargon about "adapting to new realities" and "managing risks," all while ignoring the elephant in the room: the excessive government interference and crony capitalism that created these problems in the first place. They’ll talk about embracing technology and fintech innovations, not to empower individuals but to tighten their grip on the financial system and monitor every transaction. Regulatory changes? It's more red tape to keep smaller competitors out and ensure the big banks maintain their monopolistic stranglehold, all in the name of "stability." Global economic shifts? It is a nice way of saying that their previous policies have destabilized economies worldwide, and now they’re scrambling to contain the fallout. When they raised interest rates at a breakneck pace, they helped break other currencies and fueled a massive liquidity crisis that sent stocks cratering in late 2022. Now, please sit back and enjoy the spectacle of the financial elite discussing how best to rearrange the deck chairs on the Titanic, all while pretending they’re steering us to calmer waters. It's not about real solutions; it's about maintaining control and keeping the power firmly in the hands of a few. Chart of the Week Steven Strazza shared this chart (and Syz Group republished it.) The breadth between the AI stocks and the rest of the market has hit epic levels. The last time we saw an absolute frenzy like this was the height of the Dot Com Bubble. The question people are asking… is now the start of a vast dislocation that brings the smaller cap stocks back into vogue? I would hope so. The small-cap stocks have drastically underperformed in this AI boom, but it’s difficult to project when such a rotation will occur and remain permanent. The main difference between the late 1990s and this decade has been the explosion of passive investing and ETFs that are crowding into the same positions over and over. Any reform of that passive investing would blow up the equity markets… so it feels like it will continue until it breaks. Let’s get to the week ahead. Monday, July 15, 2024 Event: Goldman Sachs Earnings, USDA Crop Condition Report Republic Speak: Hey… we did it, everyone. The economy is in a Zombie Recession… and political violence is sweltering. But at least Goldman’s profits doubled in the past, and it just saw the “second-highest quarterly net revenue in equities financing and in fixed income, currency and commodities (FICC) financing,” according to MarketWatch. Color me shocked… [they were probably all betting against the things]( they were saying publicly about oil again. This weather in Maryland is something… I was in a 180-degree dry sauna yesterday, and when I stepped outside into this humidity and 100 temperature, I wished I was back in the sauna. We’ll see how the U.S. weather has been treating corn and soybeans today and what will impact pricing as we head into the hottest months and approach the major crop tour. Corn nerds, unite. Tuesday, July 16, 2024 Event: Amazon Prime Day starts Republic Speak: What an incredible job you did coming up with this idea. It’s a great way for Amazon to clear inventory while drastically boosting its cash float on the backs of its suppliers. All the stuff bought over the two-day holiday won’t end up in the supplier’s pockets as cash… [until 45 days from now.]( My wife plans to purchase a new Kindle… because the one she bought to replace the old one that broke… has now broken too. MAYBE IT’S A PRODUCT BUG. Wednesday, July 17, 2024 Event: The Mirage Hotel in Las Vegas shuts down Republic Speak: It’s hard to think of Vegas… and look out the window of a hotel and not see the images of the Beatles. I only stayed at the Mirage once, but it created so much of the Las Vegas that we know and the businesses that are part of the financial markets. Built-in 1989, its design was ripped off by contractors left and right as the Strip was revitalized. They’ll be giving away $1.6 million in prizes over the last few days, but I’ve heard the traffic is rather “meh. By law, they HAVE to close out all of their progressive slot jackpots before they close, according to the Nevada Gaming Control Board. Thursday, July 18, 2024 Event: Domino’s Pizza (DPZ) earnings Republic Speak: It’s still one of my three favorite companies in the nation… even though I don’t eat it. It’s one of the most incredible technology and operational organizations on the planet… and people think it’s just a pizza franchise. It’s not. It’s a technological marvel that we’ll be exploring in depth. [The stock was at $310 when I wrote this last year. It’s up to roughly $500 a share.]( Friday, July 19, 2024 Event: FOMC Blackout Period to Begin… Republic Speak: This is Fed officials' last day to share commentary before the July 30 meeting. This is interesting because of what lies ahead for this market. We won’t have the Fed to kick around for two weeks while we focus on tech earnings and whether the Mag 7 will finally yield to other companies where some value does exist at the smaller cap level. I’m back - healthy - and starting a very intensive two-month diet and exercise regime. We'll be doing some recorded videos once I figure out this new camera. Please send me questions about topics to discuss while on my walks. Stay positive, Garrett {NAME} Disclaimer Nothing in this email should be considered personalized financial advice. While we may answer your general customer questions, we are not licensed under securities laws to guide your investment situation. Do not consider any communication between you and Florida Republic employees as financial advice. Under company rules, editors and writers cannot recommend their positions. The communication in this letter is for information and educational purposes unless otherwise strictly worded as a recommendation. Model portfolios are tracked to showcase a variety of academic, fundamental, and technical tools, and insight is provided to help readers gain knowledge and experience. Readers should not trade if they cannot handle a loss and should not trade more than they can afford to lose. There are large amounts of risk in the equity markets. Consider consulting with a professional before making decisions with your money.   [Like]( [Comment]( [Restack](   © 2024 Garrett {NAME} 548 Market Street PMB 72296, San Francisco, CA 94104 [Unsubscribe]() [Get the app]( writing]()