“A billion here, a billion there, pretty soon, you’re talking real money.”
-U.S. Sen. Everett M. Dirksen (R-IL) (apocryphal quotation)
Let’s face it: We’ve all become inured to the super big-dollar numbers that dominate today’s headlines.
And when I mean “inured,” I’m talking downright numb.
Hundreds of millions. Tens of billions. Multiple trillions.
It doesn’t even faze us.
The journey that’s delivered us to this point has taken years – decades – and I’ve seen most of it firsthand.
Indeed, as a journalist, columnist, analyst, and stock-picker – you know, a guy who’s been writing about the global economy, government budgets (and deficits), and big public companies – I’ve had a “ringside seat” to this mind-numbing journey.
As top world economies soared in size, as tech-firm market values rose to stratospheric levels, as government budget deficits achieved chasm-like status, and as the dollar value of the bailout/rescue/QE packages of the Great Recession soared to hypoxic highs, most “regular folks” lost the ability to emotionally connect with the dollar amounts being talked about.
This “big-number brain barrage” has led to a kind of “financial aphasia” that’s rendered us incapable of responding to the valuations that now define us.
This reality makes the story I’m about to relate all the more remarkable.
And it’s a story that you need to focus on – and act on.
Let me share it with you…
Billions and Billions
And that emergence as an e-commerce monster is partly due to “Singles’ Day” – the annual Chinese celebration of singlehood that Alibaba co-opted and that’s morphed into a 24-hour Let’s Make a Deal bacchanalia for online shoppers.
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(It’s celebrated on Nov. 11 because the date – 11/11 – is four ones – four singles.)
Singles’ Day is so big, in fact, that it dwarfs “Black Friday,” the kickoff to the annual holiday shopping season that’s the single biggest shopping day of the year here in the United States.
SFGate writer Mark Morford described Singles’ Day as “Black Friday colliding with Cyber Monday in an orgasmic nightmare cataclysm of apoplectic consumerist hysteria, times four.”
I don’t think he’s overstating it, either.
This year was the 10th anniversary of Alibaba’s commercialized Singles’ Day, and it was a great success.
This year, Alibaba racked up an eye-watering $30.8 billion in sales – a year-over-year jump of 27% and a record for the e-commerce giant’s “platform.”
And that brings me to my story.
We just “relaunched” the Private Briefing Facebook page and are gradually ramping up our efforts there. Over the weekend, when the Singles’ Day results were released, I posted a short note of my own on Facebook and Twitter and looked at some of the posts elsewhere on social media.
Folks were stunned by the numbers.
So stunned, in fact, that they actually took notice of Alibaba’s achievement.
And I took notice of that.
Indeed, I saw a bunch of investors post “stunned” (mouth-open/eyes-wide) emojis and realized I was seeing a ton of “shares” of news stories that highlighted the “$30.8 billion in 24 hours” sales results.
The bottom line: This was one big number investors were still able to respond to – that still reached them emotionally.
In short, with this “stunned” reaction, these folks suddenly stumbled onto the massive wealth opportunity you’ve known about for four years.
A massive opportunity we refer to as the “single-stock wealth machine.”
To drive this point home even more, let’s look at these numbers in a bit more detail …
Waving Down the “Wealth Machine”
As I mentioned, Alibaba’s 10th-Anniversary Singles’ Day racked up $30.8 billion in sales – a 27% jump over the $25.3 billion reported a year ago.
This year’s total dwarfs the cash taken in during the benchmark sales days here in the U.S. market.
For instance, Amazon’s Prime Day in July – the category killer’s biggest sales day of the year – is estimated to generate roughly $4 billion in sales.
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Then there’s the so-called “Black Friday“ weekend – which spawns about $14.1 billion in cyber sales for 4,500 retailers over four days (of which $6.6 billion is racked up on “Cyber Monday”).
Amazon’s “Black Friday Sale” is already being advertised on TV (I saw a TV spot Monday night as I was writing this while watching “Memphis Street Outlaws” on Discovery’s Velocity channel). According to the TV spot, this sale is set for Nov. 16-23.
When I’m talking to investment groups or to young writers – and I’m trying to help folks get past the whole “numbed-by-big-numbers” syndrome, I often use this trivia question.
If someone gave you $1 billion – which you held in an account at no interest – and they told you to spend $1 million a day, how long would it take you to run through that cash?
The answer: Nearly three years – two years and 270 days, to be precise.
We’ve Seen It Before
If you read detailed reports about Singles’ Day, you’ll see some controversy about the validity of Alibaba’s numbers.
Fact is, you could say the same about some of Amazon’s numbers.
And the reality is – it doesn’t matter.
These numbers are so big that a little bit of wiggle room is fine.
It’s about magnitude.
And about long-term upside.
I’ve done the math. I’ve detailed the global economic realities. And I’ve shared both with you as part of my investment case on Alibaba.
And that fact is that if Alibaba’s shares just perform as well as Walmart Inc. (NYSE: WMT) shares have over the past few decades, every share of BABA you buy today for approximately $148 each will be worth more than $2 million four decades from now. And Alibaba is emerging in China at the same socioeconomic point in time that Walmart emerged here in the United States – meaning it’s poised to benefit from the same “triggers.”
And that means you’ll be wealthy – very wealthy – long before then.
And that, folks, is the definition of a “single-stock wealth machine.”
Action to take: Just keep “Accumulating” Alibaba on pullbacks, or when you have extra cash.
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