Dear Reader,

Welcome to our weekly mailbag edition of The Bleeding Edge. All week, you submitted your questions about the biggest trends in technology. Today, I’ll do my best to answer them.

If you have a question you’d like answered next week, be sure you submit it right here.

5G isn’t just for your smartphone…

First up is a great question about the 5G rollout and why 5G is for more than just smartphones…

Jeff, I am enjoying your Near Future Report. You present the big picture and then narrow down to specific situations that should be able to capitalize on the new trend.

With regard to 5G, isn’t another opportunity the retrofitting/upgrade cycle for laptops, desktops, and notepads/iPads?

You make a point that all mobile telephone users will need to upgrade to a 5G phone or else they will not be able to take advantage of the 5G network… Wouldn’t that same situation be present with our laptops, desktops, notepads/iPads?

– James D.

Thanks for the question, James. Yes, you will need to upgrade some devices from 4G to 5G… but not all of them.

The easiest way to determine which devices you need to upgrade is by understanding how they connect to the internet. For example, most desktop computers, laptops, and notepads/iPads use Wi-Fi to connect to the internet. Those products won’t need to upgrade because they use a Wi-Fi connection rather than a wireless network operator like Verizon or AT&T.

But you will need to upgrade any product that connects via 4G today in order to access a 5G network. For example, I have a 4G-enabled iPad. I find it invaluable to my work. I’m often in places that don’t have Wi-Fi networks, and this enables me to continue to work through a 4G network. I will have to upgrade my iPad to a 5G-enabled version.

Most cars that are manufactured today come with a 4G-enabled modem inside (consumers never see this). It is basically like having a phone inside your car that keeps the car connected – it is not for making phone calls, just connectivity. As 5G continues to roll out, car manufacturers will migrate to 5G-enabled modems inside of cars.

So any device that relies on a connection to a wireless network operator today will be ripe for an upgrade to 5G.

What the U.S.-China trade negotiations mean for tech investors…

Next up is why the ongoing trade negotiations could be great news for savvy tech investors…

Hi, Jeff! Thanks for all your insight. I have been a subscriber for a couple of months now and am excited for the coming months. Here’s my question: Since tech stocks have been trounced the last couple weeks (presumably because of China), do you think it’s a good idea to take advantage of these low prices and add to positions?

– Travis T.

Travis, I’m glad you’re enjoying The Near Future Report. And thank you for your question. As you have probably seen, I’ve been following the developments in the trade negotiations very closely in The Bleeding Edge. These developments are tightly linked to the technology industry and directly impact our investment opportunities.

You’re correct that China is almost entirely responsible for the recent weakness we’ve been seeing in technology companies. The semiconductor and communications sectors have been particularly affected. The protracted negotiations have slowed down trade between the two countries, negatively impacted China’s economy, and directly impacted growth in the semiconductor industry. Additional concerns are that Chinese manufacturers may turn to Chinese suppliers for essential components and semiconductors.

And as I mentioned yesterday, the Institute for Supply Management showed that the nonmanufacturing index hit a three-year low. Job growth also slowed last month (but is still growing). Uncertainty around global growth has led to declines in the stock markets.

So what should we do as investors? For starters, we shouldn’t panic. This isn’t a sign of a looming bear market. This is simply a point in time, something that is most likely a short-term dynamic that we are working through.

And yes, these market dips do present great windows for investing in quality companies that have pulled back due to broad market uncertainty. And once a trade agreement is reached, I expect a tech-led market rally.

Travis, since you’re a reader of The Near Future Report, I encourage you to keep an eye on your inbox Monday afternoon. I’ll be publishing our October edition then. Be sure you read our portfolio updates. I’ll highlight a few portfolio companies that I believe are great buys at these levels.

(And if you’re not a reader of The Near Future Report, you can join us any time. Last year, my readers were able to invest in the No. 1 S&P 500 company of 2018. That’s the sort of performance I provide for my readers. Go right here to learn more and to get a look at my favorite way to play the 5G wireless rollout.)

This makes the effort all worth it…

Hello, Jeff… It was so great to meet you in person in Carlsbad at the annual summit this past week… It’s such a great experience to hear you talking about all these fascinating technologies in the same room…

I have been a loyal subscriber to Exponential Tech Investor, The Near Future Report, as well as the newly added Early Stage Trader. I’ve benefited quite a lot from your deep insight academically and financially.

– Allen P.

Hi, Allen. Thanks for taking the time to introduce yourself during the conference. I’m glad to hear you enjoyed the event.

I have to admit that these conferences are always a lot of work. I spend several weeks preparing for the event. It’s a big effort – and it’s all worth it. After all, subscribers like you give us your most valuable asset… your time. My commitment over those few days is to do my best to give something valuable back in return. Thanks for making the journey to Carlsbad this year… Maybe we’ll meet again next year.

And thanks one last time to all readers of The Bleeding Edge who joined me last month for the Legacy Investment Summit. If you didn’t have a chance to attend, don’t worry. I’ll be sharing some of my insights with readers in the weeks ahead.

That’s all the time we have for this week. If you have a question you’d like me to tackle, write to me here. I’ll do my best to get to it next week.


Jeff Brown
Editor, The Bleeding Edge