Profiting From Government Stock Picks

When the government decides a specific industry is a matter of national security, they do not hold back. They write massive checks, award lucrative contracts, and sometimes, they even take a direct stake in publicly traded companies.

Recently, a community member brought up an interesting premise: Let’s Trade With Trump. This refers to piggybacking on the current administration’s strategy of injecting taxpayer dollars into specific tech sectors to keep the United States competitive on the global stage.

For the conservative options seller, this presents a unique question. We hate risk. We love steady, predictable income. So, how do we take advantage of these massive government tailwinds without treating our portfolios like a casino? Let’s break down the strategy, the sector, and the specific stocks currently in the government’s crosshairs.

The Power of the Government Tailwind

We have seen this playbook work before. When the government announced it was heavily backing Intel to ensure strong domestic chip manufacturing, the stock saw a massive surge—rallying hundreds of percent since the government stepped in. The thesis was simple: the government will keep the company on track, feed them orders, and push them to succeed.

Traders who bought long-term call options (LEAPS) on Intel right after the announcement did incredibly well. Now, the administration is making a brand new bet.

The Next Frontier: Quantum Computing

The latest sector receiving billions in federal backing is quantum computing.

While a fully functional, commercially viable quantum computer doesn’t exist yet, the theoretical power is staggering. These machines will operate at speeds that current technology cannot even comprehend. They are so powerful that they could theoretically break modern encryption (including Bitcoin). Because of this, whoever wins the quantum race holds a massive global security advantage. The U.S. government knows this, and they are aggressively funding the companies racing to build the first one.

Podcast Transcript

The topic of today, let’s trade with Trump. How do we do that exactly? Well, there was a show that we did when the Trump administration, the government, basically said that they were taking a stake in Intel, and at that point I had said Intel is going to double, at least double in 2026. So this was before 2026. I was gonna say it’s gonna at least double, but I was wrong, it didn’t double. It actually has gone up, I think four or 5%. I mean, it’s like five, 600% since the government got in. So that one was a very good trade.

There were several other trades that we talked about in a follow-up video, where we talked about the different stocks that the Trump administration had gotten in, and they were mainly for rare earth metals. And then we did a follow-up again, and we looked at, okay, it’s been several months. How have these trades done? So, Intel was obviously the best out of the branch, and then there were some other ones, like USAR, LAC, PMO, TMO, these were all stocks that the government now owns a piece of. Not 100%, but they own a piece of it, and so we looked at those, and I think there were five or six. Intel did the best, and then there were three that did really well, and then there were two that did not. So overall we gave Trump as a stock picker for the government… we gave him a good grade because the stocks were mostly up, and I think if you had put an average or the same amount of money, if you had put, like, let’s say you put $1,000 into each one of those, you would be up very nicely, mostly from the Intel boost, but the other ones, you know, did okay. The ones that did well did okay. The ones that went down, I mean, they haven’t lost a lot, but they’re just not doing as well as the others.

So, with that in mind, there was an announcement this week that said that, oh, the administration is going to be buying even more stocks. So, okay, maybe, maybe we can make some more money off of this. All right, so what’s the news? What’s the news? What’s going on? Well, the government got into the quantum computing space. Now, what is a quantum computer? I’m not the right guy to tell you. I have no clue, but I do know that they are not real yet. There is no such thing as an active working quantum computer. It’s still theory. It’s being worked on. It has been being worked on for several years, but they are getting closer to it. And now there are companies that are actually public that are raising money, and they’re doing research to find these computers.

Now, what’s the big deal about this quantum computer? Well, it is pretty much the best computer you’ve ever seen, kind of thing, right? There was a headline recently that the models that they have so far, if they kept advancing at the rate that they’re advancing, they would be able to break the encryption of Bitcoin, which is supposed to be so far advanced that nobody’s ever supposed to break it. But a quantum computer, a regular quantum computer, could do that, and so that is actually very scary for Bitcoin holders and crypto holders, but that’s, you know, that’s the game of cat and mouse that we’re going to be playing. The more advanced AI gets, the more advanced computers get, the more bad people are going to be using those to break into systems that are not as advanced, so the security systems will have to keep upgrading while the computers keep upgrading and the bad guys keep upgrading, so it’s just a never-ending cat and mouse scenario, right?

Kevin says, “Good afternoon from Lakeland, Florida.” How you doing, Kevin? Awesome, nice to have you there. Lakeland, Florida. I’ve actually been to Lakeland, Florida. That’s pretty cool. Yeah, I used to… I grew up in Miami, and when we were little, there was a… I remember there was, like, I don’t know if it was the world’s tallest ever Christmas tree, but they used to do it. I think it was in Lakeland, and we used to drive every year up to go see this huge tree. I don’t know if they still do it. I hope they do. It was pretty cool. It was a great, it was a great yearly experience, you know. We always, we would go with other families, we go. Friends and stuff, not… It was a bit of a drive from where we lived, but still it was fun. So, yeah, Kevin, thanks for watching. And yeah, hope, hope you’re doing well in Lakeland.

Alright, so back to Trump and the trade. Okay, so we have these quantum computers. The country is now investing in them, that means our tax dollars are going in there, and so we have to take a look, what are these? And really, I mean, you can imagine a computer, if it’s so smart it can break Bitcoin. We’re talking about national security, right? Pretty much, and so you don’t want to have another country, maybe an enemy country, that gets the quantum computer first, because then they’ll just wreak havoc on all of our systems, and you know they can do whatever they want. So I agree that we should, as a country, focus on this type of advancement, this type of tech to build it up. I’m surprised they’re doing it this way with owning a piece of the company. You know, most of the time the government will give grants or the military will step in and give contracts. In this case, they’re, you know, they did like Intel, they’re like, hey, we need a strong chip maker here in the US, so we’re going to give you money, but we’re also going to give you, you know, contracts, we’re also going to buy from you, we’re also going to tell other people to buy from you. And so since then that stock has taken off, that company has taken off, and so now maybe we’re going to see the same thing with the quantum computing companies that the government has tapped into.

So they have bought shares in four companies that are public, they’ve also bought a piece of a few other companies that are not public. They didn’t buy everything in the space, and there was one that was left out, IonQ. IonQ was left out. I don’t know why, you know, we don’t know why they were left out, but it was interesting that they were, and that even then that company, that stock is still going higher based on the news, so it’s going to be interesting.

The names of the ones that were mentioned are IBM, which I didn’t even know was in quantum computers. I mean, I know Google’s in quantum computers, Google is not one of the names on the list, but IBM, and then there’s GFS. Sorry, no, that, yeah, GFS, which is GlobalFoundries, that is one that they just took a stake in. QBTS, which is D-Wave Quantum, that is another one, and Rigetti, Rigetti Computing, which is RGTI. Now, all of these have already taken a very nice bump to the upside. Rigetti today is up 18 and a half percent right now. QBTS is up 12, IBM’s up almost two, GFS is up six and a half today, and that’s today. They also went up nicely yesterday. So, these four have already gotten really nice gains.

So, for example, Rigetti was trading at about 16, right now it’s at 26. If we take a look at IBM, IBM was trading at about 224. Right now it’s at 257. So pretty big moves, especially for IBM, which was in doldrums. It was at a 52-week high just a few days before this announcement came out. It was trading at 212. Now it’s at 257. It did hit a high this last year at 324. So I’m expecting this stock to continue to rise. It has today gone through the 100-day moving average. It does have the 200-day moving average at about 270, so you got another $13 before it hits the 200-day moving average. I do think it’ll go through there and probably hit close to 300 just on this news alone.

If we take a look at GFS, that one is at a new high, 52-week high. I don’t know, it might even be an all-time high, most likely. That one’s trading at about $86. It was trading at about 70 when the news came out, and that one for the last year is trading about 30, and so now all of a sudden it’s at 90 or close to 90, probably will keep going. Then we have QBTS, that one was at about 19 when the news broke out, right now it’s at 29. That’s D-Wave. Last year it hit a high of 46, a little bit over 46, and this one was also at a 52-week low of $12.75 just in March. So these companies, they had a bit of momentum last year, then that kind of fizzled, and they all hit, like, you know, they were hitting 52-week lows, except for GFS, and then now they are back on the upswing. So, yes, they are. This one, especially, it just, you know, went right through the 100-day moving average to 200-day moving average, and it is now going higher and higher. D-Wave QBTS does have some resistance at about 30, and it’s at 29 right now. So, keep an eye on that, see if it breaks that. If it does, it’s probably going to go all the way to 40 or 45. So that’ll be an interesting one. Rigetti, looking at the technicals, this one was about 16 or so, a little bit below 16 when the news came out. Now it’s at 26. It is also above all the moving averages with an 18% move today. This one had a high last year of $58, so this could easily double before it even makes a new high.

So that’s four names that are on the list. Out of these, I think I like IBM the best, just because it has revenue, it has other things. $2 billion was spent by the US government in investing in all these companies. IBM got half of that, so I think the government sounded like, “Okay, yeah, we’re gonna, we’re gonna invest, but we’re putting most of the money on this one.” Most of our chips are going on this one stock, and so I think that’s probably the one that I would also get into if I was going to do this. And with Intel, I did get into it after the news came out. I did buy some long call options, some LEAP options. They have done very, very, very well. I think it might be time to do the same thing with IBM.

Now, again, none of this is personal individual investment advice. I’m not telling you what to do. Trading is risky, and we could lose all our money. It doesn’t mean these stocks are going to go up, like I said they might. So just be careful, but I’m telling you what I’m thinking about doing. And I mean, you could take one option is to take, hey, I’m going to take, you know, an equal amount of money, and put it on all three. That’s one thing, or you could pick and choose. If you were to pick and choose, I think IBM is the safest bet, but if you want the biggest return, I think you would probably get that with one of the smaller ones. GFS, which is GlobalFoundries, looks to be maybe the best, because that one was doing well as a stock even before the news came out, so the other ones were basically 52-week lows before the news came out. GlobalFoundries was at a 52-week high when the news came out, and so it just took it to the next leg up, and it was trading at about 70 or 70 and a half, and now it’s at about 87. And so I would say that one is probably going to give you the biggest bang for your buck. IBM is probably going to be the safest one, and then you have the other two, which are trying to make computers, and so they’re probably the most leveraged. If either one of them does make a quantum computer first, that one will obviously be the winner in the market, and so you never know which one is going to win. It’s kind of like, hey, you know, if I’m betting on AI, do I bet on OpenAI or do I bet on Anthropic, or which one? You know, which one is going to win? Claude is going to win, or ChatGPT is going to win. We don’t know yet. The news is still out there. We don’t know which one’s going to win, and so we will see.

And that’s kind of like the same thing with this quantum computer stuff, we don’t know which one or which company is going to come up with the first computer, and we don’t know when. This could take several years. So, on the prediction markets, according to Kalshi and Polymarket, and all those, the bettors are betting that there is not going to be a quantum computer before 2027. So we got a couple years, according to the bettors. Now, all of those people are not bettors, a lot of those people are insiders, so they might even be people working at these companies, and so they know what’s going on. So, I would say, yeah, 2027 or later, 2028 or later would be when the first quantum computer comes out. So, if you do take a share into one of these, I mean, you’re thinking you’re looking at this as a long-term bet, a long-term play. This is not something that’s going to be like, oh, hey, I made my money in two months and something like that. This could take a long time, especially if you’re going into D-Wave or Rigetti, because most of their revenue will come if they make the quantum computer right. But keep in mind there’s also bigger players like Google that have already been in the space for years. Japan is already working on it. And I believe Japan is actually advanced, they are ahead of us when it comes to quantum computing, so they might win first, right? And they might take the market from anybody else, so we’ll see. But then again, with a computer this strong, this powerful, it is a matter of national security, and so I think if these companies, any one of these companies, gets even close to building the computer, I think if they reach out to the government and say, “Hey, we need more resources, we need more people, we need more money for research to make it go faster,” it will be supplied. And if a Japanese company comes out with it first, we don’t even know if Japan will allow that technology to be used by anybody else. They might just keep it in Japan, or China, if that happens, right? So, we’ll see how that works.

We don’t really know what’s happening, and again, that’s a lot of trading. We don’t know what’s going to happen in the future. We don’t have a very clear signal. The only signal we have here is that, hey, look, the administration did this in the past with another industry, it worked so far, that’s what we know. It’s been a few months, it’s been several months, actually, and the results are okay. So now they’re doing it again. Here, should we piggyback off this? There’s a good chance that it will also work. So, if you’re looking for some idea of what to invest in, this would be a good play, I think. Again, time will tell. I haven’t really decided what I’m going to do. I might do a LEAP option on IBM, just to take a flyer. I’m not usually… based on my trading needs, I’m not really into taking these deep big bets. My larger trading account is a trading account I use for income, and so I don’t want to just, you know, buy something and have it sit there for years, not really making any money. I want my money working constantly. I want it to be generating income every single month or every single week, if possible, and so I don’t want to own a lot of stock. I don’t want to be tied up in call options that are very, very long. Now, the Intel one has already worked. I’ve already taken my money out of that, and now I’m playing with house money, so I’m okay with that. IBM would be a different scenario. I got to put money in and let it be tied up, hopefully it’ll double quick. I can take my money out, and then just play with house money, and then that’s fine. It doesn’t matter, right? But again, that money is still tied up that I cannot use for income.

So, interesting situation. I’m not sure what I’m going to do yet, but this is the bet that we are talking about. This is the new Trump trade, so there was Taco, there was Nacho, I think there was Nacho, but this is the new thing that the government… now keep in mind, we also got news this week that Mr. Trump has been making a lot of other trades in other companies, we’re not talking about those, okay? What he’s doing in his personal portfolio is not something that we are talking about here, and obviously you know they had disclosures, and they said that Trump personally, or his family, did not do any of those trades. He had an advisor who’s making all these trades. It’s a little bit funny on the timing, right? He’s buying a stock, and then a week later he’s tweeting that people should, like, you know, he bought Dell computer, and then, like, a week later, he went out and told people, “Oh, you should go buy a Dell computer.” Oh, yeah, okay, I mean, you know, you take it for what it is, but that’s not what we’re talking about. We’re not talking about any of those companies. We’re only talking about the ones that they used taxpayer money to buy recently, and to see if they are worth buying into for ourselves.

Quantum computing, if it comes about, it’s going to change everything that we know. One example is that recently, last week, for the first time ever, researchers were able to transport matter about 300 feet. So, what I mean by that is they took a piece of matter, it was not that big, it’s like a proton, so that’s really, really tiny, but they took it from one area and they transported it, meaning it disappeared, and then it reappeared about 270 feet away. And so that is kind of what quantum computing uses, they use quantum physics, and so the speed of everything is just so advanced, and I can’t even… my brain has not wrapped around how it actually works, so I don’t know how they transport matter, but they have, and this was the first time ever. They’ve done it before on a smaller scale. Again, this is only a proton, so it’s really tiny, but it was 270 feet away, which is pretty far. That’s like point one six miles for those of you who don’t know how far that is, but that’s pretty far to transport something. A piece of matter disappeared, and then reappeared that far away. So, I mean, we’re talking about getting into Star Trek territory, you know, like, “Beam me up, Scotty.” It’s gonna be a while before they beam up an entire person, but that’s the first step, right? And that’s how quantum computing works to some degree, and so if they can do that already now with what we have, as the technology gets better, as the AI gets better, it’s only going to advance. And so one thing to keep in mind is the technology that we have today, right, with quantum computing, with AI. This is the worst it’s going to be, basically. Right now, you know, “Oh, hey, quantum computing doesn’t work right now.” Yes, but this is the worst. It’s only going to improve. AI is only going to improve, quantum computing is only going to improve. Everything else that they’re talking about is only going to get better and better, because there’s lots of money being thrown at this stuff, and it is needed. In a sense, if we are going to survive as a species, I believe this stuff is needed, and I believe in SpaceX, and I believe that we do need to get to space to save humanity. I really agree with what Jeff Bezos said this week in an interview, where he said that all industrialization should be off-planet, and yeah, I’ve been saying that. I think any type of mining, any type of drilling, any type of environmental degradation should not be happening on Earth. It should happen in space. There was an interview from Peter Diamandis yesterday that I watched, where, or two days ago, I think it was two days ago, where he was saying… or maybe it was yesterday, I don’t know, the days all get jumbled up, but he was saying that all the things that are valuable on Earth, right, physical things, energy, land, metals, gold, platinum, titanium, all these rare earths, all this stuff is valuable here because it’s limited. But in space it’s unlimited, it’s infinity. You can have as much real estate as you want in space, right, and all the other stuff, and so we need to get over there. And so that’s going to be another topic that we’re going to be talking about. SpaceX, the IPO coming up soon, that’s like the biggest thing on all the shows, but I didn’t want to talk about that right now.

Back to our background, okay, how can we make money from Trump? And this is the way. So, there’s four companies again. I’m just going to reiterate: IBM, GFS, QBTS, and RGTI. Rigetti, D-Wave, GlobalFoundries, and IBM. These are the four public companies that the US government has just recently taken a stake in, and all of them are rising because of that. IBM was the biggest beneficiary that got a billion dollars in funding in exchange for stock. We don’t know how much stock they got, we don’t know what percent the government owns, but you can bet that if the government is an investor in your company, you know they’ll keep you on track. That was my thinking with Intel, that they will keep Intel on track, they will give Intel orders, they will push it to be better than it probably was on its own. And so, since then, the Intel stock has just been skyrocketing. IBM, we’ll see, maybe this is the new heyday of IBM. I know IBM was big in the past and has lost its luster. It was actually the first AI stock with Watson. I don’t know if you remember Watson, but everybody thought IBM was going to come up with and rule the AI world. They have not, but I guess they are playing in quantum computers. I didn’t even know that, but looks like they are, and so the government is involved, and we might be trying to make some money off here. Who knows? We’ll see what happens.

All right, that’s it for today, Joe. I wish you all a happy weekend. Have a good holiday, enjoy that extra theta decay. Enjoy the extra day off on Monday, and we’ll see you all next week. All right. Take care.