Are we on our way to new highs on Wall Street?

by time news

So there is or is not a recession (3) (for a previous column on the matter)? True, in terms of the popular definition, according to which 2 consecutive quarters of a decline in GDP mean a recession, the US is in a recession. But that’s not really true. Why? Because the official announcement of a recession should be made by the Business Cycle Dating Committee, which is part of the National Bureau of Economic Research. of the USA (National Bureau of Economic Research’s Business Cycle Dating Committee)And the committee is still silent.

So it is true that some serious institutions such as Goldman Sachs and Morgan Stanley and some important celebrities such as Jamie Damon and Professor Rubini and even Elon Musk and Cathy Wood claim that the USA is in a recession, but compared to the slowdown in consumer spending and business investment that did decline, there are other data, including, crucially, Solid growth in employment and income. “To call it a recession without taking them into account – and without waiting to see how these GDP figures will be corrected in the end – would be premature,” say the committee’s economists, “especially in an economy that behaves like the current one.” Add to that the transfer of huge budgets in the field of chips (52.7 billion), the climate (430 billion), health (739 billion) that were recently approved by the Houses of Representatives and the 1.2 trillion in infrastructure that was approved in February of this year (all of which are still in their infancy and their impact will begin towards the end of the year) and well You have enough reasons to doubt whether the approaching recession is real or a temporary slowdown as a result of the corona accompanied by a flock of black swans that joined

There are already signs that this is a temporary slowdown. There are signs that the supply chain crisis is coming to an end, even the Global Supply Chain Stress Index, established by the Federal Reserve Bank of New York explained here, fell in July by 57% from the peak. Oil is 27% below the peak of early June and bonds refuse to accept “persistent inflation”.

The market will continue to move forward with shocks and the main reason for this is the uncertainty (too many swans are still sailing above us) and no less the media and the networks that in order to accumulate ratings and attention must sensationalize and be as bad as possible. But, as we write all the time, the global economy, led by the American economy, is in a long-term growth cycle driven by the creation of new giant niches, increased consumption, ongoing efficiency and the expansion of income circles, when the swans go away and the headlines adjust to reality, I would not be surprised if the end of 2021 records are broken During 2023-4. All this provided that the American politicians, who are very reminiscent of our politicians, do not deteriorate the USA, this is the real danger.

Psychedelic drugs are approaching the world of medicine: The New York Times claims that “psychedelic drugs are (again) approaching medicinal use”, it seems that there is a renewed media and medical interest in psychedelic (psycho active) drugs of the kinds that were as popular in the 60’s as acid (LSD), the “magic mushrooms” (psilocybin), the ecstasy (theMDMA), the aivasca, the ketamine and more. You can find explanations about each of the above on Wikipedia.

Psychedelic drugs have a long history of use in medicine and religion, where they are highly valued for their ability to promote mental and physical healing. The medical contribution of these drugs, especially in the psychiatric field, was known, but the negative effects of these drugs outweighed the positive medical potential inherent in them. In the West, led by the United States, these drugs were seen only as a nuisance. The medical side of psychedelic drugs in the United States, which usually leads in medical innovation, was neglected mainly due to the negative effect on the youth, an effect that, since the Woodstock Festival, in August 1969, brought the problem to the fore Today the USA is very conservative and the negative image has only grown since then.

But medical research regarding the effect of these drugs continues all the time and in recent years, mainly due to the medical progress in brain research alongside the sharp increase in the diseases that psychedelic drugs are identified with, depression as an example, an increase that increased during the Corona period, the medical industry woke up to the issue.

These drugs actually present an innovative and promising avenue of treatment for some of the most difficult-to-treat psychiatric conditions, such as post-traumatic stress disorder or treatment-resistant depression. Proponents of adding psychedelic drugs to medicine claim that with proper supervision, the drugs are as safe as existing drugs. The claim is that the psychedelic experience, which in many cases has been proven to be life changing, can really change lives, for the better. This claim is increasingly being accepted by the younger generation of doctors in the fields of psychiatry who claim that the use of psychedelic substances helps people experience what is best described as mystical experiences and that these experiences have been linked to improved outcomes. There is already quite a bit of evidence for this. A study conducted by theNew England Journal of Medicine in 2021, showing that patients with moderate to severe major depressive disorder who received two doses of psilocybin did just as well—if not better—than patients who received a daily dose of escitalopram (an antidepressant). Further study of Naturefrom 2021, showed that assisted therapy MDMA Very effective for people with PTSD severe, and the treatment is safe and tolerable.

Wall Street enters the field and at an increasing rate: Wall Street, as usual, noticed the trend and in recent years many psychedelic companies have been issued and startups are growing non-stop. You can see the quantities in the following link. The “queen of technological dreams”, Mrs. Cathy Wood, has been feverishly collecting, since February of this year, the stock of the German biopharmaceutical company Atai Life Sciences (symbol:ATAI), which deals with the development of various treatments that focus on mental disorders. Wood collected over 3 million shares (the majority during July) in its Genomics Revolution basket, ARKG.

Wall Street’s interest is big news for the psychedelic drug market, especially for the flood of startups that were founded during 2021 and caught up in the current correction. Getting such a positive headline from Cathy Wood was just what this industry needed. That’s right, this fund and other funds ARKall the stars of 2021 on Wall Street, led the declines in 2022 (theARKG fell by 77% until the middle of last June) but you will be surprised, these falls did not change the level of confidence that investors give to the lady. At the height of the falls last June, they were poured into the funds ARK record amounts (for theARKG alone had a positive flow of 600 million dollars).

But earlier this month, Morgan Stanley issued a highly optimistic report about this old-renewable industry, having formed a team of investors and researchers with the aim of Identify the “next big idea that has the potential to cause far-reaching results” And the team concluded that early results suggest that psychedelic therapy has the potential to fundamentally reshape the way we think and care. Not only in mental illnesses but also in a number of other situations. In their estimation there is a real chance of obtaining my approval FDA Also for drugs and processes beyond diseases such as post-traumatic stress disorders (PTSD) or depression.

Morgan Stanley researchers identify “additional potential markets for psychedelic drugs” such as ADHD, Addiction, anxiety and more. Such a statement of support is no small thing on Wall Street and it is highly recommended to look here. Finally, more and more studies from prominent institutions, such as the Johns Hopkins Medical Center, indicate that such drugs, in the correct formulations and with supervision, can lead to therapeutic breakthroughs in patients, especially in those for whom other types of treatment have been shown to be ineffective.

hookL Street enters the game in strength: As always happens in new niches led by the technology revolution, so also in the young psychedelic drug industry. The interest she created in Wall Street begins with the investment houses, with the investment funds and of course in the research laboratories of the pharmaceutical giants where every “potential” is meticulously followed and let’s start with an example. The health giant Johnson & Johnson (NYSE:JNJ) developed a nasal drop spray called Spravato Closely chemically related to ketamine, an anesthetic known for its stimulating effects on the brain and often used as a party drug with the nickname “Special K“. But besides the above it has been proven in studies that it has a quick effect on depression symptoms. the confirmation FDA The spray was given in 2019 and only to patients who are not affected by antidepressants. But the patient must take the drug together with the anti-depressant pill Zoloft developed by Pfizer (NYSE:PFE), which is also used as an antidepressant and was approved 31 years ago. God-FDA He demanded close supervision of the patient because the clinical tests did not show “complete success”.

So why did they approve? Because of the great demand for help for depression sufferers who are not helped by any medication (over 3 million in the US alone) and the new drug, which has been determined in trials to be harmless, helps a high percentage of them. Spravato“, she announced J&J To the public, “he is part of the renaissance in the development of new and better treatments for depression, a condition in which patients are mainly dependent on drugs that are decades old” and this “renaissance” comes from psychedelic drugs. If JNJ And for sure PFE involvement in attempts to use psychedelic drugs so believe us that Eli-Lil (NYSE:LLY), Biogen (NYSE:BIB) and the rest of the enormities inside. ABBV For example, in 2019 it purchased, for 63 billion, the Botox manufacturer, Allergan PLC did so, among other things, in order to enter the field since –Allergan advanced in the field. Note that once again a huge niche is created here that is supported by the ability of technological disruption. While the medical giants are entering the field, venture capital investors are also arriving in droves

So what can the small investor do? Most of the companies that focus on the field are small and investing in them is very speculative. the websiteFool.com Brought, at the beginning of the month, an article in which he chose 8 stocks that the site believes are recommended, and in the first ATAI (collected by Wood), definitely worth reading but be careful because the chances of “success” for such companies are very low. All 8 are in the baskets we will mention later. Finally, although medical giants like JNJ or BIB entered the field, investing in them “because of the psychedelia” is not worthwhile because the effect of the developing field on the value of the shares is completely minor.

And yes, there are baskets. The Advisor Shares Psychedelics (symbol:PSIL) as an example, a basket that was issued in September 2021 and went straight into correction (lost 60%). The basket is active (the composition changes with progress) and every company, out of the 28 companies in the basket, is focused on psychedelia. It’s a very small and very speculative basket (you won’t find pharmaceutical giants in it). There are 3 other baskets similar in composition but passive (adjacent to indices), all of them are relatively small and all of them have fallen strongly since the beginning of 2022. The basket, Horizon’s Psychedelic Stock Index (symbol:PSYCH) the basket Next Gen Altered Experience (symbol:PSY) and the basket PSYCH. All are suitable for a dream corner. We note that there are many investors who associate companies in the psychedelic field with cannabis companies and this is a mistake, the market for cannabis products is completely different.

* The above should not be seen as a recommendation to carry out operations and/or investment advice and/or investment marketing and/or advice of any kind. The information presented is for information only and is not a substitute for advice that takes into account the data and needs of each person. The one who makes use of the above information – does so at his own discretion and sole responsibility. The authors may hold some of the papers mentioned above.

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