Hello, reader.

Are we going into a depression?

Everyone I talk to is terrified that we’re about to have one, but they’re wrong; what we are currently experiencing is more like a “wealth shift”.

People are right to say something big is happening, but it’s not total obliteration…it’s a transition.

As a wealthy friend of mine recently said, it’s like a giant drawbridge splitting our country in two…

  • On one side are the rich – who fully understand what is going on and take full advantage of the situation. The rich get richer, so to speak.
  • And on the other side is everyone else, who no matter how hard they work or what they do, they will continue to fall behind.

And that proverbial drawbridge is lifting, with the widening gap between the “haves” and the “have-nots”.

And if recent stock market action has shown us anything, that gap is widening with fierce the rapidity.

While thousands of cash-poor old-school businesses are in deep trouble, hundreds of cash-rich businesses are comfortably weathering the crisis.

This dichotomy was well established before the arrival of the COVID-19 pandemic. We even invented a term for it: The Technochasm.

long-time readers of smart money as well as subscribers to Investment report and The speculator know it well. But if you haven’t been to these parts in a long time, it’s been a hot minute since we last covered them.

And it is essential that we reexamine it, because the effects of this phenomenon are becoming more visible day by day.

Something is wrong in America

And it has nothing to do with the stock market or the politicians who run this country.

This problem is more important and deeper; it is something that I expect will rewrite the American social fabric in the years to come…bankrupting millions of Americans in the process.

So if you’re worried about your retirement or even the future of this country, you can’t afford to ignore the message that I want to share with you today.

What East Technochasm?

Let me paint the Technochasm phenomenon in a picture we can all relate to:

In the spring of 2000, a man named Reed Hastings came to Dallas with a great business idea.

Hastings approached the management of movie rental giant Blockbuster with a proposal. He wanted Blockbuster to buy his small business for $50 million.

At the time, the Hastings company – Netflix Inc. (NFLX) – had a promising business model. It allowed people to rent movies by mail. Netflix at the time was small and struggling to make a profit.

Hastings thought a Blockbuster purchase of Netflix would be a win-win deal. Blockbuster managers did not. They didn’t think Netflix’s business model made sense to them. A Netflix executive later said that Blockbuster basically made Hastings laugh out of the room.

You can guess the outcome of this story.

Netflix secured investment from other sources and created a hugely popular mail-order DVD rental business.

Around 2007, it made a brilliant move and began its transition to America’s #1 movie and TV “streaming” service. This innovation wiped out traditional rental companies like Blockbuster.

In 2002, Netflix had less than three million subscribers; since July 2022, the company boasts 220.6 million subscribers, and its stock has reached a market valuation of $96.6 billion (even with the bear market we’ve been through this year!).

And how is our old friend Blockbuster?

It has a single store opened in Bend, Oregon with three employees as of 2019.

He went from a market value of $5 billion to bankruptcy in under nine years old. Its shareholders lost everything…and its Netflix “pass” is widely considered one of the worst decisions in modern corporate history.

To give you an idea of ​​what an investor would have done with a first stake in Netflix, consider that Netflix stock fell to an adjusted low of $0.35 per share in 2002. Suppose you didn’t buy the bottom, but instead waited until the stock had built up visible momentum and then bought at $1 per share.

If you had committed just $5,000 at that price to buy 5,000 shares of Netflix, that modest investment would now be worth over $1.6. million – a mind-numbing efficiency of more than 32,000%!

On the other side of the drawbridge, the destruction of seemingly strong and dominant corporations by innovative, tech-driven upstarts is a story we’re starting to see again and again and again in America…

  • In 2009, Travis Kalanick and Garrett Camp founded the ride-sharing company Uber Technologies Inc. (UBER). In less than seven years, Uber has demolished the “old” taxi industry while making its founders into billionaires.
  • Over the 10-year period from mid-2009 to mid-2019, the shares of technology-focused firms Amazon.com Inc. (AMZN) skyrockets more than 2000%, making Jeff Bezos the richest man in the world. Meanwhile, dozens of old-school brick-and-mortar retailers have been pushed out of business.
  • A study of the newspaper industry conducted by the University of North Carolina reported that 1,810 newspapers went out of print from 2004 to 2018. Large amounts of cheap online content killed many newspapers that followed the ‘old’ media business model.

Year after year, we see established companies that seem solid and control their markets being completely destroyed by upstarts.

In many cases, these companies employ tens of thousands of workers…and are the lifeblood of retirement accounts. But the apparent strength of these companies often hides their underlying weakness. Businesses that don’t adapt die a slow but certain death.

And the rate at which these huge disruptions occur will accelerate over the next decade.

They will make the wealth gap grow every year.

And that’s why I call this gap “The Technochasm.”

Summary

The idea of ​​Technochasm is not meant to strike fear into the hearts of my readers; rather, I want to help you prepare for all the market threats that I can.

Because no matter how you invest right now, heavily overvalued stocks will be continue to fall in value over the next few months… and other companies will be to skyrocket.

This is why it is essential that you reassess your assets in the coming months, and I want to help you get started.

That’s why I just named 25 stocks you need to sell today. Each of the stocks on this list is toxic.

In fact, if you keep them in your wallet, I have no doubt that you will lose money in spades.

For the complete list of actions, Click here

Eric Fry is an award-winning stock picker with many 10-bagger calls – in good AND bad markets. How? By finding powerful global megatrends…before they take off. In fact, Eric has recommended 41 different scholarship winners over 1000% over his career. Additionally, he beat 650 of the world’s most famous investors (including Bill Ackman and David Einhorn) in a competition. And today, he reveals his next potential 1000% winner for free, here.