Gray Days, With the Streets Full of Blood
Some days, it feels like the world is coming to an end.
That it's all crumbling around us. And in turn we want to flee to safety.
"Run, Forrest, run!"
Run for the hills!
Run for cover!
But I like pullbacks...
The Russell 2000 is now down more 6.5% since the start of September. And is at its lowest point since May.
If it dips below the 1,000 level, it'll be the first time small caps have done so since July 2013.
Its all-time high in July of this year of 1,213.55 is a forgotten and faded memory. We're now 10.5% away from that mark, wading through "Correction Territory."
The Dow Jones Industrial Average is once again below 17,000. It's off more than 3% from its last all-time high... set on September 19.
For many, that seems like eons ago... Not a mere nine trading days.
We all know everything eventually comes to an end.
Your light will someday flicker out. As will mine. As will all of ours until immortality is achieved. The markets will crash. Empires will topple. Entropy will claim the universe.
The bull will die someday, either from old age or getting hit by a bus.
I don't believe either of those is happening today.
We're getting ready to delve into earnings season - a glorious and volatile time of the year. Mid-term elections are on the horizon after that. And of course, there's always the slew of geopolitical events that slide stones in the market's pockets.
The markets deplore uncertainty... And will sink when faced with an unknown on the horizon.
Think of the old Magic 8 Ball and the answer that sometimes bubbled up: "Reply hazy; try again later..."
So, the recent pullback doesn't signal an end necessarily.
Instead, it's an opportunity for investors to snag some "should'ves..." and "if onlys..." at more reasonable prices.
Because we have to keep thinking toward the future.
And what's underway right now is one of the largest shifts in the history of the country.
It's a shift in demographics, which has political ramifications.
It's a financial shift in terms of purchasing power.
And it's a shift in the way consumers think... What's important to them... What they want to spend their money on... And how they spend their money.
It's a trend unfolding now that will carry on for the next five decades.
It will double by 2020... And will eventually grow to $10 trillion per year.
And the companies that are catering to this trend - that have recognized the subtle but profound changes - not only are profiting tremendously, but will continue to do so in the future...
Taste the Profits
Let's take a company like Chipotle (NYSE: CMG)... Shares are currently 5% off their 52-week high of $697.93, which was set in August.
But they're up more than 11% since the last time I wrote about the company here at the end of June.
And they're up more than 1,400% since the company's IPO on January 26, 2006.
This is a perfect example of the shift underway.
Is McDonald's (NYSE: MCD) the No. 1 fast food restaurant of the future?
McDonald's doesn't rank in the top spots in the new worldview of fast food... It's Chipotle at No.1, Panera Bread Co. (Nasdaq: PNRA) at No. 2 and Subway at No. 3.
McDonald's growth in the United States has lagged its growth in Europe and Asia, which are the two most important markets for the burger chain.
Does Chipotle have to spend money on advertising?
Nope. Not really.
Try going into a Chipotle's at lunchtime. See how long it takes to get your burrito.
At the same time, Chipotle's annual revenue has gone from $830 million in 2006 to $4 billion this year and a projected $4.78 billion in 2015.
It's more than just people's love of burritos.
Think about Apple (Nasdaq: AAPL), which I've been bullish on all year... Before the iPhone, the iPod and the iPad, Apple was far from being one of the most important companies to the global economy.
In fact, during the 1990s it was struggling.
In 2006, Apple made a little over $19.3 billion in revenue.
In 2007, Apple released the iPhone and the iPod touch... In 2010, the iPad.
This year, Apple will make more than $180 billion in revenue. Next year it'll be more like $200 billion.
And that's because those products targeted the leading edge of this new trend. In turn, it's had an even larger impact as the number of people purchasing from mobile devices has skyrocketed.
Shares of Apple are off 4.4% from their 52-week (and new all-time) high set at the beginning of September... And that's right as we are about to head into the all-important holiday shopping season. And after Apple sold a record 10 million iPhones in the three days following the release of the iPhone 6 and iPhone 6 Plus on September 19.
So, don't think of the recent pullback as a sign of the bull coming to an end.
Think bigger. Think of all those companies that are on your wish list - that you should've bought earlier... if only you had bought earlier - and act.
Particularly those that are catering to the new world order in fast food, technology and mobile commerce.
P.S. I recently completed in-depth research into this trend, and I've compiled the results into a detailed report with a portfolio of world-changing stocks that I call the M-Index. It's far too much data to include in a single column, but you can access the full report here.