Monday, October 26, 2015
|YOUR BEST SOURCE FOR THE UNBIASED MARKET COMMENTARY YOU WON'T GET FROM WALL STREET|
|$19 Trillion Internet Shockwave|
|by Martin Weiss|
The greatest nations of the world continue to face some of the most intractable problems of our lifetime: Massive debts, government gridlock, and in many areas, recessions, wars, or revolutions.
These are not problems that can be solved by the Federal Reserve, the European Central Bank or the Bank of China. Nor are they going to change very much based on efforts by political leaders of left, center or right. This century has proven that the most officialdom can come up with is a patchwork of gimmicks that merely prolong the agony.
In fact, there's only one major place left on the entire planet where I feel we can find the kind of strength, skill and global leadership we need to help create a bright spot for humanity: American technology and ingenuity.
As we saw last week, U.S. technology is the single outstanding good-news story of our times. Despite all the financial blunders our leaders have made and despite all the financial mishaps still to come, technology continues to profoundly transform the way we live and work.
That's why we call it transformative technology. And that's why it's technology with the power to create new fortunes.
The Coming $19 Trillion Internet Shockwave
(Interview transcript, edited for clarity and brevity)
Weiss Research: Jon, before we talk about this massive investment opportunity, we want to ask you about your timing.
Jon Markman: The technology stocks I'm going to talk about are riding a major wave of innovation. And that wave has a momentum all its own that's far bigger than any short-term timing issues.
That's why I believe now is the best time to buy the right names ... because not only are technology stocks sitting at attractive prices right now due to the recent pull-back, but more importantly, I'm looking at some of the biggest technology trends we're likely to see in our lifetimes.Imagine a single interconnected world that merges sensors, computers, wireless networks, the Internet, and mobile technology into one gigantic on/off switch for our entire life.
Imagine everyday objects, household appliances, machinery, buildings, automobiles, airplanes, and more that can now communicate with us, with each other, and with other applications over the internet.Weiss Research: Just how big of an opportunity are we talking about?
Jon Markman: The applications are almost limitless. So industry experts, companies, and research firms are all throwing trillion-dollar market estimates around like they're chump change.Let me give you an example. General Electric estimated the Internet of Things could add an additional $14 trillion to global GDP over the next two decades.
And then Cisco came out with an estimate that the Internet of Things could add $19 trillion to the worldwide economy by 2020. That's just five years from now and represents 10x growth.Already, the Internet of Things is growing so fast and the changes are so big that the profit opportunities are going to overrun any short-term secular market down trend.
That's why you didn't see me panicking about near-term technology pullbacks. Market corrections are not even blips on the screen when compared to the $19 trillion market growth opportunity in the Internet of Things.Weiss Research: Why now? I mean, you pointed out yourself that the Internet has been around since the 1990s.
Jon Markman: True, but it wasn't until just recently that the technology behind the Internet of Things finally reached the tipping point where it can be scaled up.
Everything has come together: The price of sensors, processors, and networking has dropped significantly. WiFi access is available just about everywhere. New advances now allow millions of devices to connect to each other through networks.
So now, people, machines and the physical world can talk to each other and exchange data effortlessly, without thinking.
We're entering an age of what I call "immersive intelligence," in which individuals are literally bathed in smart, meaningful, fun, and useful connectivity.And with more and more objects becoming embedded with sensors, the connectivity is literally limitless. It's like automation on steroids.
That's what makes the profit potential for the companies involved in the Internet of Things so exponential.
Weiss Research: How do investors participate?
Jon Markman: There are literally thousands of ways. They can invest in the sensors. They can invest in the devices, the data communications, and in the software that monitors, analyzes and sorts the data.In fact, the Internet of Things today looks a lot like the Internet back in the mid-1990s.
And just like investors who ignored the huge profit potential of the Internet back then, those who dismiss this Internet of Things today as some kind of "geek dream" are going to get left behind.Weiss Research: Can you give us some specific examples of the technologies you're tracking in this area?
Jon Markman: Sure. One way to think about this opportunity is to think about all the categories of "smart" things that exist in the world.
I'm not just talking about smart phones but also smart cars, smart cities and smart businesses. I'm talking about how all of these things will interconnect with each other and make everyday life more efficient and satisfying for all of us.(Click here to access Jon's free special report, "The Coming $19 Trillion Internet of Things Shockwave" with even more details about the fantastic profit potential you can tap into from the new Internet of Things.)
Weiss Research: But how do we get from here to there?
Jon Markman: It can be a bit of a bumpy road, but that's always the case with technology. And think about how far we've already travelled.
First there were albums, then CDs, then the iPod came along. And we thought it was really cool to have 1,000 songs on our iPods. Now, you can connect to Spotify and have direct access to five million songs.
Or remember how cool it was to have a few dozen DVDs in your collection? Now you have access to millions of DVDs on Netflix.That just gives you a quick sense of the dimensions we're talking about. Everything will become just one more device that makes your life easier, saves you money, or improves your health.
Weiss Research: Explain what you mean by "everything will become another device."
Jon Markman: Sure, the easiest way that people will see this is in autonomous cars. Think of your car as a device — not a vehicle.
Eventually your car becomes like a smart phone on wheels. It's just another device that's connected to the Internet, transports you to where you want to go, and makes your life easier.
Take parking, for instance. The reason a car can park itself is because it's aware of things. It has artificial intelligence that allows it to interact with the world in a magical way. It can tell how far away it is from another car, from the curb, from a road hazard. We are literally giving cars the gift of sight, so that they can see objects on the road, take evasive action, and avoid collisions and, yes, park themselves.
Weiss Research: But how will the industry get people to surrender their car keys?Jon Markman: People will want to give up their car keys because their lives will be so much easier without them. Imagine if you could talk on your smart phone or work on your iPad while you "drive" to work.
Weiss Research: Ha! A lot of people already do that.Jon Markman: No kidding! But what if it were safe? Not only that, but you could drive until you were 102 or 112! People won't have to give up their freedom as they get older.
And what if it saved you money? Autonomous cars offer can huge savings in terms of insurance, collision damage, loss of life and a lot more. In fact, Morgan Stanley estimates that driverless cars will save $1.3 trillion dollars every year in the U.S. alone.
Weiss Research: That's a lot of economic incentive.
Jon Markman: It's more than just an economic incentive. It's also saving lives. That's why so many automakers are in the final stages of designing smart cars right now. They automatically correct when you drift out of your lane. They automatically brake in an emergency. And they have cruise control that automatically adjusts for the speed of the car in front of you.
Meanwhile, right now, 23 million cars are already connected to the Internet, and 152 million cars will be connected in the next five years. This is huge. The total global market for driverless features alone could hit $42 billion by 2025.
Weiss Research: 2025 seems a long way away.
Jon Markman: You don't have to wait until 2025 to profit. One of my favorite companies in this sector is already up 115% from its IPO. You could have doubled your money in just a year for some pretty hefty short-term gains. And I expect the shares could double over the next two years in a good market, and double again three years after that.Weiss Research: OK, I get smart cars. But what's a smart city, exactly?
Jon Markman: Smart cities use the technology behind the Internet of Things to better manage power, water, and gas; to direct traffic, control street lighting, reduce pollution, and a lot more. Just imagine what happens when a smart car and a smart city communicate with each other.Smart traffic grids already time traffic lights in a nuanced and dynamic way that allows traffic to move freely.
Smart grid systems save money by using power more efficiently. In fact, recent research shows that smart grid systems could save billions of dollars, not to mention hundreds of millions of barrels of oil annually.
That's why so many cities around the world are implementing smart grids today, creating lots of profit opportunities for smart investors right now. The profit value of smart cities alone will reach a massive $1.7 trillion by 2025.
Weiss Research: With numbers like that, you could retire rich in ten years or less.
Jon Markman: That's true. But there's an even bigger profit opportunity that I see right now: smart businesses.In a low-growth environment like the one we find ourselves in today, companies are looking for every opportunity they can find to save money, and the Internet of Things allows them to do that in ways they never imagined possible.
Just imagine a manufacturing plant with hundreds of lathes turning out hundreds of parts every day.
Right now, the lathes are turned on at the start of the day and they turn millions of times a day. And that overheats the plant, making workers miserable.
But what if you could coordinate the temperature in the room? The more the lathes turn, the more the air conditioner kicks in. And when they aren't in use, the air conditioner shuts down.
What if you could cut down on the number of unnecessary lathe turns by just 10%? By turning them on and off as needed in response to intelligent sensors? What if that saved $10,000 a day, and then you did that every day?
It's what a smart engineer would do if he was really on top of his game.
Problem: It's next to impossible for an engineer to do this efficiently. But it can be done in the new world of the Internet of Things.Incorporating the Internet of Things into the business grid will save billions.
I recently read a report from The Economist that said that 25% of manufacturing companies are already using a live Internet of Things system. And another 75% of global companies are currently exploring ways to add or improve their use of the Internet of Things.As more businesses incorporate the Internet of Things into their operations, the net profit potential will explode, reaching an estimated $8.5 trillion by 2025.
And that means thousands of ways for investors to profit.
Weiss Research: That's not science fiction, is it?
Jon Markman: Absolutely not! The Internet of Things isn't some kind of abstract concept, it's already here. Just look around you.
Consumers already own an average of 20 different interconnected smart devices including phones, computers, and household appliances.
And remember: as recently as 2000, the Internet was just becoming mainstream. Google was still in its infancy. Apple had yet to invent the iPad. And Amazon had yet to make a profit.Yet, today, just 15 years later, we can't imagine life without email, smart phones, iPads, and Amazon Prime.
But early investors who recognized the potential of these quote unquote NEW technologies, became staggeringly wealthy with returns of 1,300%, 3,000%, 5,000% and more. That means every $10,000 invested then is now worth $130,000, $300,000 or $500,000.
And you don't have to wait 15 years to profit. Many of these stocks doubled and even tripled within a few short years.
That's why I'm so passionate about this opportunity, because it has the power to create tremendous wealth for those who start now.Weiss Research: It's hard to visualize something this big ...
Jon Markman: The reality is, most people don't think big enough. When you sit down and think about all the ways that you can connect sensors, devices, data and machines ... the Internet of Things is the ultimate disrupter — turning every industry on its head from agriculture to energy to healthcare to automobiles.
Very rarely does a technology revolution like this come along. It's going to create new profit opportunities in every imaginable industry.
That's why I created a special report called, "The Coming $19 Trillion Internet of Things Shockwave."
Weiss Research: And you're making that report available to our readers.
Jon Markman: Yes. Just go here.
Weiss Research: Thanks, Jon.
Jon Markman: Thank you!
(Click here to access Jon's free special report, "The Coming $19 Trillion Internet of Things Shockwave" with even more details about the fantastic profit potential you can tap into from the new Internet of Things.)
The investment strategy and opinions expressed in this article are those of the author's and do not necessarily reflect those of any other editor at Weiss Research or the company as a whole.