Ted Bauman has declared that cash is no longer the king of currency. This can’t be a surprise to you because the last time you paid cash for something must have been ages ago. If you are anything like the rest of the world, you pay for your utilities, housing and internet services online. When you go to the grocery store or to fill your tank up with gas, you use you debit or credit cards.
The use of cash as payment for anything is a thing of the past. In 2016, the Federal Reserve discovered that people only used cash as payment in 35 percent of all transactions. In addition to that, a majority of those transactions were made in amounts less than $25. Because of this, the most circulated form of currency became the $100 bill for the first time in 2017.
This doesn’t mean that more people are paying for their purchases with $100 bills. They choose not to because it is so hard to verify that a $100 bill is legitimate. Instead, the $100 bills are now filling our savings vehicles.
If you are unable to let cash go, Ted Bauman has a newsletter by the name of “Smart Money Portfolio” that gives you much better things to do with your cash than putting it into your piggy bank. There is also something else that will let you ease your way into a society that no longer uses cash.
This other option is not Visa or MasterCard. These have been around for too long. It is also not Apple Pay or Google Wallet even though these two options are very good, but the market has cashless payment companies that are purer than those two companies.
Ted Bauman is going to tell you about one payment processor that you have to have in the cashless future, but let’s first find out who this man is.
Ted Bauman graduated from the University of Cape Town with a postgraduate degree in economics. He received a postgraduate degree in history as well. He spent 25 years in South Africa as an executive for nonprofit organizations and a fund manager. He uses his training as an economist to give his readers an analysis that considers more than just the conventional wisdom of the day. Because of that, he can see everything that causes some people to earn a profit and all of the things that would cause someone to lose money.
Ted Bauman’s Recommendations
The biggest cashless payment system stock to own is “PayPal Holdings.”
This company didn’t become its own until 2015. Before that, it was a payment system that made it possible for eBay’s customers to pay online, but it is now a much larger enterprise.
PayPal is the biggest online payment system, and 244 million people are using it today. A Statista survey found that most people preferred to use their credit cards to make payments, but the method people enjoyed almost as much was PayPal. In the survey, credit cards were endorsed as a preferred method of payment by 42 percent of respondents, but PayPal was chosen by 39 percent of respondents.
Although credit cards are still being used in large numbers, PayPal can be used in place of this payment method as well. PayPal became a partner with MasterCard, and customers now have PayPal credit cards as an option.
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— Ted Bauman Guru (@TedBaumanGuru) October 16, 2018
Venmo and PayPal
The payment app Venmo is highly popular, and PayPal owns it. People can use this app to transfer money from one user to another.
If you find yourself in a situation where you need cash but don’t currently have any, you can use the Venmo app to pay. Venmo does have competition. It is Square’s Cash App that is being downloaded more often than Venmo at this time. This isn’t a problem because the cash app market is humongous, so a little competition isn’t going to hurt Venmo. In addition to that, PayPal processed transactions in the amount of $18 billion in the first quarter because the app has become extremely popular, so we don’t have to worry about Venmo.
If the above wasn’t enough, PayPal is cutting into Square’s business by launching PayPal Here. PayPal Here is a point-of-sale app that allows users to accept payments through PayPal and credit card anywhere that they are. To make this happen, people only need to have PayPal’s credit card readers and a smartphone.
A cashless society is growing, and PayPal is right in the middle of it with an increase in revenue of 20 percent since the company separated from eBay. The year 2018 has been extremely kind to PayPal, and it has surpassed earnings estimates in every quarter.
Because of all this good news, it’s time to invest in PayPal. In May, the stock was experiencing low prices, but in the present day, it is up 22 percent. Now that the stock is rallying, it is being supported by its 50-day moving average.
PayPal’s stock (NASDAQ: PYPL) is a great bargain for investors because it is rebounding off of its 50-day moving average. PayPal’s 14-day Relative Strength Index is at around 53 and is continuing to climb higher. This tells us that this stock has not been “overbought” yet and that people are going to be purchasing shares again.
As the stock reaches the $95 region, it has the potential to experience instability. The holidays are currently upon us, so the stock should have the necessary buying support to sustain a continued rally.
Investors can pick up this stock in the $88 to $94 range, but if you wait for a breakout above $95, it may cost you.
If you have not been convinced that this trend is real, consider this fact. eMarketer is a digital research firm, and it believes that mobile payment apps will process $120 billion in transactions in the year 2018. That is an increase of 55 percent over last year, but by the year 2021, this number is expected to double.
The fact that this trend is occurring all over the world informs us that this is not a momentary fad. The New York Times even published a story on it entitled “In Urban China, Cash Is Rapidly Becoming Obsolete.” In it, the author stated that mobile payments have been occurring at the rate of $5.5 trillion every year, and that is 50 times more than in the United States.
Visa
The profit potential for these stocks is enormous, and Ted Bauman has recommendations for stocks other than PayPal as well. Another one is Visa. After experiencing a few difficulties in its beginnings as a public company, Visa has done well recently. Since its beginning 10 years ago, the company’s stock is now up 750 percent. The S&P 500 is only up 110 percent over that same time period. Last quarter’s profits show us that things are not slowing down now.
Visa is currently invested in a partnership with PayPal, so it is entrenched in the mobile payments that are increasing at this time.
Alibaba
Another stock to look into is Alibaba. This company deals in online advertising and e-commerce, but it also has a mobile payments method. This method was given the name “Alipay,” and the United Nations believes that payments made through this method will add up to $1.7 trillion. This is 23 times more than the amount the method made in 2014.
Apple
Apple is the third option. The iPhone is making it possible for consumers to take advantage of mobile payments everywhere. iPhone users have “Apple Pay” as their mobile payment system, and 127 million people are using it today. Apple is such a huge powerhouse in the cellular phone market that experts expect it to expand its business into the stratosphere.
Read: Microsoft’s Attempt To Compete With Apple
Square
Another option is Square. Since Square became a public company, its stock has increased by 400 percent, and it doesn’t look as if the current growth spurt is going to slow down. It continues to be profitable and is offering its customers new products. Its future is looking good right now.
Want to learn more about Ted Bauman? Click here to read his interview with Inspirery.com.
Dil Bole Oberoi
