This cheap inflation hedge could get a huge AI boost

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Today’s issue in preview:

• This cheap inflation hedge could get a huge AI boost
• These stocks will get you into the next big AI trade
• The insiders know a lot more than you do. Here’s what they say about the stock market
• Learn our Top Themes to buy now

These stocks will get you into the next big AI trade

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We nailed it.

It’s not getting much press, but the bull market in genomics has become one of the world’s strongest trends… and a new engine of wealth creation.

This morning, leading genomics firms Twist Bioscience (TWST), Absci Corp (ABSI), Natera (NTRA), Beam Therapeutics (BEAM), and Illumina (ILMN) each surged more than 7%. Many genomic firms reached new one-year highs.

This extraordinary strength across the genomics theme drove the ARK Genomic Revolution Multi-Sector ETF (ARKG) up 6.8% this morning to a new one-year high, making our call to own genomics a huge winner so far.

Constant Money & Megatrends readers are not surprised to see the genomics theme surge to new highs. Over the past few months, we’ve written over half a dozen research notes about the extraordinary upside potential of biotech and genomics. We were genomics bulls before it was cool.

Genomics is the science of analyzing human DNA – often referred to as the “software code of life” – to create tests, medicines, and treatments.

Years of innovation in this field have us on the brink of creating many customized treatments based on an individual’s DNA… and even “editing” genes to cure disease. Bulls on the industry believe it will get a giant “AI boost,” since super-intelligent computer programs can analyze genes and treatment effects so well… and have the potential to create drugs on their own.

The fusion of AI plus genomics should generate dozens of compelling stock narratives over the coming years. Researchers running superintelligent AI programs will be able to run millions of digital simulations of drugs and treatments. This will put medical innovation into overdrive… and create many big stock market winners.

The personalized approach to medicine that genomics offers has us on the cusp of a historic revolution in healthcare. Ten years from now, medicine will be transformed… and a lot of money will be made along the way.

As I mentioned on May 28, ARKG is one way to track and trade the genomics theme. It owns a basket of bleeding-edge genomic companies. Its largest holding, Tempus AI (TEM), is often cited as a premier way to play “AI in health care.” ARKG also holds significant positions in genetic diagnostic service firms NTRA and ILMN… plus positions in promising “gene editing” companies CRISPR Therapeutics (CRSP) and Intellia Therapeutics (NTLA).

It’s increasingly looking like genomics is being painted with the “AI brush,” a development that can turbocharge any trend or stock here in 2026. Although the sector has enjoyed a strong June, we believe there’s much more upside ahead.

This cheap inflation hedge could get a huge AI boost

Credit: Ron and Patty Thomas

Cheap inflation hedges don’t just grow on trees. You can find them underground as well.

On May 19, I detailed how out-of-favor timberland REITs represent a relative bargain in the world of assets that can protect your savings from the harmful effects of inflation.

You probably know why being vigilant against inflation is important: governments in most Western nations have promised far too many things to far too many people. They are spending far more on taxpayer benefits and wars than they collect in tax revenues.

The related debts and obligations governments have taken on cannot be paid back with sound money. They can only be paid back with debased, devalued money… much of which is created out of thin air. This is driving inflation and significant currency debasement. Prices are going up because the value of our money is going down.

With this in mind, everyone over 60 should consider which assets can help them preserve their wealth during periods of inflation.

When I provide people recommendations on how to approach this challenge, I urge them to keep my number one rule in mind: You want to own in-demand, useful assets that cannot be easily replaced or replicated. You want to own businesses and real estate properties that produce in-demand, scarce resources, products, and services.

This group of assets includes quality farmland, beachfront real estate, timberland, great businesses, and oil and gas pipelines.

When a very difficult or impossible-to-replicate business or a piece of real estate produces in-demand, scarce resources, products, and services, it tends to hold its value no matter what the value of the dollar is doing. Its price will constantly “recalibrate” to accommodate an increase in currency units. It’s like the difference between slicing a pizza into 6 or 8 pieces. The number of slices changed, but the amount of pizza is the same.

In addition to the assets listed above, let’s add “enormous proven reserves of in-demand natural gas” to our list of inflation defense vehicles.

Avid Money & Megatrends readers know that AI Power Consumption and the Power Grid Upgrade are two of our highest-conviction long-term themes.

Given AI’s enormous promise, big tech firms Meta (META), Google (GOOG), Amazon (AMZN), OpenAI, and Microsoft (MSFT) are racing to build the world’s best AI models and infrastructure. They’ve already spent more than a trillion dollars. This year, they are on pace to spend over $700 billion on AI infrastructure, with more than $3 trillion expected to follow.

All that AI infrastructure is poised to consume vast amounts of electricity. S&P Global estimates that global electricity demand will increase by nearly 50% by 2040.

I’ve frequently mentioned that AI’s growing power demands are a major driver of natural gas demand, as it is the preferred clean-burning fuel for power plants that support AI data centers. Growing demand for U.S. natural gas from Europe and Asia is another powerful demand driver.

A compelling way to invest in this theme – and fortify your portfolio against inflation to boot – is to own a basket of America’s leading natural gas producers. This group includes EQT (EQT), Expand Energy (EXE), Antero Resources (AR), Range Resources (RRC), CNX Resources (CNX), and Comstock Resources (CRK).

Buying a basket of these firms makes you the owner of a vast and diversified collection of the highest-quality natural gas fields in the United States. And since natural gas prices are relatively low right now, their stock prices are near one-year lows. If you’re looking for cheap, out of favor inflation defense assets, you’ll find them in natural gas.

The insiders know a lot more than you do. Here’s what they say about the stock market

Credit: CHUYN

This week, the stocks of airline giants Delta Air Lines (DAL), American Airlines (AAL), and United Airlines (UAL) surged to multi-year highs.

This means we can add another voice to the loud chorus of “real world” economic indicators saying that the U.S. economy is doing much better than most people think.

Over the past four months, I’ve written over a dozen research notes that analyzed the soaring share prices of trucking stocks, industrial stocks, diesel engine makers, steelmakers, shopping mall operators, and hotel chains.

At the end of each note, I pointed to their soaring stock prices and told readers that the U.S. economy is doing much better than most people think.

Each of the above industries is highly sensitive to ups and downs in the U.S. economy. Their fortunes rise and fall with America’s ability to build infrastructure projects, go on vacation, transport goods, spend money at the mall, and generally just “get along.” And most people don’t realize this, but stock prices in those industries are booming.

This exceptional price strength across a broad swath of critical companies, which are highly sensitive to U.S. economic health, suggests the economy is actually doing very well. Industries involved in making things, transporting things, and buying things are enjoying growing revenues and rising stock prices.

And keep in mind: The stock market is one of the world’s greatest forecasting mechanisms. It tends to look ahead 6-12 months. When an industry is in a recession, its stock prices will rise before the news media says it is recovering. When an industry seems to be doing well, its stock prices will decline before the news covers its downturn. This is often called “discounting the future.”

The stock prices of large U.S. airlines like Delta, American, and United are another important “real world” indicator. The fortunes of these firms rise and fall with America’s ability to pay for vacations and travel for business. And their market values just surged to new multi-year highs.

You can read a thousand opinions and forecasts related to the Iran war, the new Fed Chair, or the direction of interest rates. However, there’s only one source of objective truth: Market prices.

The market prices of today are the sum and current manifestation of all knowledge held by industry insiders, connected money managers, government officials, and bankers who quietly control huge swaths of the economy. These people know 50 times more about their industries of focus than you or I do.

Their knowledge manifests itself through action… and that action that sets market prices. Market prices are not always perfect, but most of the time, they know hell of a lot more than any economist, podcaster, X poster, or investment guru.

If you ever get brain overload from listening to or reading lots of “experts” espousing lots of conflicting opinions about a war, a technology, or the health of the economy, you can easily tune them out and focus on signals that contain more distilled insider knowledge in them than all those experts combined: Market prices.

Sure, the global economy has problems. It always does. But keep in mind: Making money in stocks is never about being in problem-free economic climates. It’s about being in economic climates where the big negatives are overwhelmed by the even bigger positives.

Right now, the big positives are driving the market values of critical and highly economically sensitive firms to new all-time highs. You can believe your opinions, someone else’s opinions, or something far more informed: The market. And the market says, “We’re booming. Trade accordingly!”

Market Notes

• Our January 26 idea to own sports teams as a unique inflation hedge is paying off. Atlanta Braves (BATRA) surged to a new all-time high today. The stock is up 33% since our note.
• Leading AI defense firm Palantir (PLTR) reached a new one-year low today.
• Leading fiber optics firm Corning (GLW) reached a new all-time high today.
• Retail giant Target (TGT) reached a new one-year high today.
• Consumer goods firm Williams-Sonoma (WSM) reached a new one-year high today.
• The rich are getting richer… and spending money on high-end cruises. Luxury cruise operator Viking Holdings (VIK) reached a new all-time high today.

Regards,

Brian Hunt
Editor, Money & Megatrends

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