Mr. Money Talk

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Episode Transcript

(00:10):
Good afternoon. This is Josh Marnoldmissed her money talk with Judd Arnold.
You're gonna answer your questions on stocks, bonds, mutual funds, how you
should position your investment dollars including yourIRA in four oh one k. You
do have to give us a callat nine five two nine two five five
six oz eight. That's nine fivetwo nine two five five six o eight.

(00:36):
You always get straight talk, notsugarcoated advice. What a week it
has been on Wall Street? Whata week market has gone up and down,
in and out on concerns primarily aboutthe debt ceiling and any deal that

(00:57):
can be designed between the President andthe Speaker. Speaker of the House,
negotiations are getting hot and heavy,though I've always questioned how heavy are they
going to be? Given the Senatehas gone on a week plus hiatus,

(01:21):
and the House members were told thatthey could go home for the weekend,
but be ready to come back toWashington as soon as there is a deal.
On Friday, Secretary of the TreasuryJanet Yellen came out and said,
well, the due date we foundand recalculating our numbers is not June first,

(01:46):
which would be next Thursday. It'sthe following Monday, June fifth,
so that gives both the Democrats andthe Republicans a few extra days to to
cut a deal on the debt ceiling. But some say the debt ceiling debates

(02:09):
is all all a lot of uh, will say Babbel, But the and
the real the real concern is notthe debt ceiling, but what the FIT
is going to be doing with interestrates, given that the economic numbers are

(02:29):
still showing inflation, though that inflationhas been coming down. The hawks amongst
the Fed governors who vote are stilladamant that interest rates still need to go
up before there is any pause inraising rates, as they indicate there's still

(02:55):
more and more work to be done. Some of the US are saying,
well, we need to pause atleast a little bit to see the effects
of our eleven increases in interest ratesin the last year plus. We're still

(03:15):
concerned with the bank crisis that hasbeen going on, and the bank crisis
creating a credit crunch, particularly inthe mortgage market, with mortgages going up
and becoming tougher to get and businessloans also being tougher tougher to get,

(03:42):
and the case of any credit tighteningcycle could definitely slow the economy down,
insomuch as not nunely reduce inflation,but actually bring about there's one economist Don

(04:03):
Luskin said, a deflationary cycle.Now that's going to be debated, but
the odds right now are a littlebit better than fifty fifty that come the
June meeting of the Fed, interestrates are going to go up at least

(04:28):
twenty five basis points, but there'sstill a few weeks to go with that.
Meanwhile, meanwhile, the indices havebeen moving up on the backs of
a select group of companies and twoprimary industries, the chips and the home

(04:55):
builders. The chips for the mostpart on fuego, particularly any company that
is directly involved in artificial intelligence orgenerative artificial intelligence. And this has been
a move that started about a monthago at Microsoft's Developers Conference when Microsoft unveiled

(05:28):
their chat GPT integration with Being andthat boosted first Microsoft, then Google,
but the biggest beneficiary has been chipcompany Novidio. In video, Oh my

(05:56):
god, what a what a run. It is staggering, unbelievable moves that
this this stock made from um we'llsay Wednesday night when it reported its earnings
and the stock was trading at threehundred UM three hundred dollars a share after

(06:18):
a big run by the way aftermoving up from a bottom at the low
of one hundred and twenty five dollarsa share, and it finished the week
at the three hundred and ninety dollarsa share. Unbelievable and many are saying
that this is the place to be, and well, you're a night.

(06:43):
You had a nice trade there.I had a very nice plotting on the
end. We like in video.We've struggled because it's such an expensive stock
and it has had now four fiftypercent of greater pullbacks in the last I
want to say seven year on theway up. Uh. Yes, it
has had some very and this pullback, the most recent pullback I think was

(07:05):
seventy five m to the low withthe whole tack liquidation at the end of
the year. And it has beenexpensive all year on the way back up,
and it was correct. This isone of the biggest earnings beats we've
seen. Um. And when Isay biggest earnings beats, we've seen the

(07:25):
things that come to mind. Certainlyin my career Facebook when they had the
blowout when they figure out mobile twoor three hurtings calls in post ipo when
the stock was up thirty five percentand street numbers, that's estimates went up
fifty Yeah, let's just put putput a pen to paper. They guided

(07:46):
to it is eleven billion of revenue. The video guided to eleven billion of
revenue, which was the street werefour billion above where the estimates, Well,
the stream is, yes, streetwas it? I thought the street
was an eight street was at sevendollars. This just doesn't and I guess

(08:07):
for people listening, this can happenwith a smaller capitalization stock in video has
what forty analysts that cover the stockcorrect and for it to be to be
consensus by over fifty percent, justit doesn't happen. No, this is
this is just un unreal. Theonly other one was Zoom Video during the

(08:33):
pandemic the first earnings where they beatthe street by seventy percent, but that
was sort of like, okay,it's the pandemic, and that was still
like an infant, like this isit's it's unbelievable. So there we go.
The stock actually de rated from fiftytimes earnings to forty times earnings,

(08:54):
which is you know another it justgoes to show so unbelievable. You had
a great little tree trade. It'snice to make big numbers. So even
though, yeah, you got tobe intellectually flexible in this business. A
lot of people were set up shortinto this print because the stock was at
a nosebley valuation. It turned outto be one of those rare times where

(09:18):
here before before we go for abreak. But it is very interesting,
and I know that I know CathyWoods is getting a lot of heat from
the to the talking heads because shedid not she had sold her in the
video position in January before the bigrun, saying that the stock was no

(09:43):
longer considered we'll say breakthrough technology.It's so hard to call this stuff,
right, you know, Apples andan all time all time high for Apple
pretty close to an all time high. Amazon's working well. You don't have
to win every road. Yeah,we like to get some trades working well.

(10:05):
Amazon, which will come back togot a nice, nice boost because
it is also now now painted withthe artificial intelligence brush. But both Apple
and Amazon have been leaders in artificialintelligence for many many years. When we

(10:30):
come back, talk more about artificialintelligence, what is working and what is
not in the market. But itis going to be a long weekend,
so plenty of time to study andget ready for a short week next week

(10:52):
and then in to June. Thisis Josh Arnold, mister money Talk with
Judd Arnold. We're always here tohelp help you. Nine five two nine
two five five six o eight.This is johnsh Arnold missed her Money Talk
with Judd Arnold here to answer yourquestions on stocks, bonds, mutual funds,

(11:18):
how you should position your investment dollarsincluding your IRA and four oh one
K. Don't hesitate to give usa call at nine to five two nine
two five five six o eight.That's nine to five two nine two five
five six o eight. Artificial intelligenceany company around artificial intelligence has gotten a

(11:46):
big boost this past week, anda few have been getting some pretty good
moves up in the last month sinceMicrosoft made their announcement of dealing with open
Aiye, the company behind chat GPT. Microsoft desire to use this product was

(12:16):
to enhance their being search engine sothat they could better compete with Google or
alphabet. Google's search engine, whichis the dominant dominant force so after Microsoft,

(12:37):
which has continued to move up andhas seemed to be a huge beneficiary
going forward with art in dealing withartificial intelligences, so as it adds it
to its products. Then we haveFacebook in their analysts update a couple of

(13:00):
weeks ago mentioned how it is usingits own artificial intelligence um we'll say chat
bot to enhance their advertising results.So we'll say Meta or Facebook has continued

(13:22):
to climb up. Now Meta alsogets a lot of props for Mark Zuckerberg's
i'll say pivot away from the metaververseand back to his we'll say, back
to his roots with Facebook, Instagram, YouTube not YouTube YouTube as Google's um

(13:56):
and and reels as a way todevelop that business and really to to work
out and enhance their advertising space.Now I we have been very, very
big an Apple and Amazon for forever, I'll say for forever, and Amazon

(14:22):
has been which I've shared, sharedwith you, shared with my clients,
a huge, huge bit of frustration. While it's not frustrating anymore. Back,
no, it is not frustrating anymore. Not trying to be cavalier about
it, because there's an overriding point, which is the big tech stocks are

(14:45):
back doing this year. What they'vedone for twelve thirteen years. And it's
really only the big ones at thispoint, which is they are shrugging off
everything. Oil goes up, oilgoes down, interest rates go up,
interest rate, they don't care.They're just getting all the flows. It
is the top of the SMP fivehundred that you know, it's seven or

(15:07):
eight stocks that are just driving theindex and continue to get equity flows and
they're immune. Why do I bringup the bond marketing, Well, the
six months yield and the two yearyield are back near all time eyes.
And this all last year. It'sreally from the end of twenty twenty one
all the way through twenty twenty two. Body yields up, tech stocks down,
and they are just shrugging everything off. Right now, Well, you've

(15:31):
got you've got a group of companiesthat generates an unbelievable amount of cash.
They provide products or services that peopleare going to use, regardless of whether
we have inflation deflation, whether youhave a booming economy or a recession.

(15:56):
Well that was all true last yearand the year before. I point I
was making, which not to discountyou, but to politely disagree or push
back to me. What it saysis equity flows are not at risk right
now. The money that was goingto come out came out, and now
people are repositioning. I think youalso have another dynamic that is really important

(16:22):
to understand for the average person,which is, this is another year and
we've had a lot over the lasttwelve more so than we've ever had in
the preceding forty. Where the differencebetween the S and P five hundred,
which is marketcap weighted, and theequal weighted SMP five hundred, which is
weighting them all the same, thatdivergence is massive. It is ten percentage

(16:47):
points on return. So the SMPfive hundred, the one that everybody knows
and loves, is up nine pointeight percent. The equal weighted SMP five
hundred is down point three percent forthe year. That's a that's a that's
a big, big un that ishuge. And what you see is a
lot of the big mutual funds theybenchmark to the S and P five hundred

(17:08):
and what you have going on,especially in video, but you're also singing
with Amazon, Apple and whatnot.Most big actively managed mutual funds are underweight
growth and have been underweight the bigstocks well I think that most of the
most of the mutual mutual funds acrossthe board have have been and most advisors,

(17:29):
I would venture to guess again,Um, just by listening to the
advisors that show up on Financial TV, I think they're they're all underweight stocks
as you you mentioned, and overweight. Uh. They're very much overweight bonds
and overweight Uh. We'll call itthe value stock. That's what I'm saying.

(17:56):
They're overweight value, and the valuestocks have been hit and most of
the values stox have been um infinancial services, primarily in bank in banking.
Yes, this is going to beone of the worst years in the
history of active managements. Not forus. We're overweight. Our two biggest
positions are Apple and Amazon. Notfor not for us, but for active

(18:21):
management in general. This is goingto be verse the index, probably a
worse. It is going to beone of the worst years that I've seen
in my life. You know.Now, last years, as I've talked,
you know, I underperformed the index. Uh, not by a lot,
but still underperformed the index. Andthis year we've got to put that.

(18:45):
You've got to put that in contexton a rolling five year basis,
you have to go back I thinkto O two. So the last time
you were underperforming the index under rollingfive year Yes, but I mean I'm
just but we got well just becauseof our overweight position and the fact that

(19:07):
we run correct postury concentrated focused theportfolios. Of course they're not not for
everyone, but they've they've continued towork. And something that I found many
years ago that being concentrated in andnames that offer well, first off,

(19:34):
big liquid we have no liquidity riskssoever you can't, but they're generated during
um companies that still have a lotof growth potential going forward. Well,
look, we're gonna come back again, but we'll take a little interlude for

(19:55):
those listening to our commentary on thedeath ceiling. Here's the commentary. They
always figure it out and it doesn'tmatter. What I mean is they've always
figured it out secondarily, and ifthey actually do screw this up and we
default as a government, you're supposedto buy a lot of stocks that day
because they'll figure it out in thenext day. And under no circumstances,
as anybody who is a lender tothe US, the US government's always going

(20:15):
to pay back a hundred sets onthe dollar. Correct, it's just a
question of when. And I don'tthink it would be the worst thing ever
if they did default. From ourperspective, we got plenty of cash or
ready to buy. And you know, these politicians need to see the air
in their ways every once in awhile, and I just it's always kabuki
theater with these things. But that'snot the issue. That The issue that

(20:38):
is scary that will be a catalystfor something later in the year is the
banking system is still in a lotof pain. Lending has been really restricted
and interest rates continue to go up, which is even more fuel makes it
really difficult for the banks. Andit's no, it's very difficult to want

(20:59):
to own banks, but you lotof money going there, right, We're
more focused on the other on thesecond derivative, which is bank You know,
bank lending is really going to becurtailed. I want to come back
back to that when we come backbank lending being curtailed, and maybe some
opportunities that might present present itself.Say this is Josh Arnold miss or Money

(21:26):
Talk with Judd Arnold here to answeryour questions on stocks, bonds, mutual
funds, how you should position yourinvestment dollars including your IRA in four to
one k. Call us nine fivetwo nine two five, five six o
eight. This is Josh Arnold missedor money Talk with Judd Arnold here to

(21:49):
answer your questions on stocks, bonds, mutual funds, how you should position
your investment dollars including your IRA infour one k. Don't hesitate to give
us a call nine five two ninetwo five, five six or eight.
That's nine five two nine two fivefive six oh eight. We always get
straight talk, not true coded advice. We're talking about banks and the concern

(22:17):
with tightening tightening credit due to higherinterest rates and the banks investment portfolios being
will say underwater on a market marketbasis. More underwater now is rates of
just skyrocketed back rates came in,which makes bond prices go up in March
and we are back to the widesas they say on yield, which is

(22:41):
the lowest for bonds. It isan ugly, ugly thing to be a
bond investor. And we were onthe brink of default. We're probably not
going to default. We don't thinkthe fault is going to matter if you
just tune in. If it doesdefault, by everything you can, because
it'll be resolved pretty quickly. Butman, what a tough time for banks.

(23:03):
On top of it, even afreights weren't going up. These banks,
they're on the wrong side of thiswhole thing. They got a huge
surgeon deposits. Deposits I think areabout seventeen point one trillion. If they
were at their historical run raid whowould be about fifteen trillions. You need
two trillion to come out twenty threetrillion of bank assets out there, two
point two or two point three trillionof bank book equity of banks, almost

(23:26):
one hundred percent of the book aquityof banks has to be refunded to the
depositors. That's so what's gonna happen, right, What's gonna happen On a
practical basis, Banks are gonna haveto shrink their balance sheets inaggregate by about
ten percent. That means as loanscome due and mature, probably only eight
out of ten people with a bankingrelationship are going to get there they're loan

(23:48):
or their credit line renewed. Banksare who's gonna say, sorry, we
have to shrink. Tough luck,and the impact on the economy is gonna
be pretty bad. Can we getthrough this shirt like it's shaping up to
be a lot like the SNL crisisof nineteen ninety to ninety two, where
pockets of the market really did quitefine. Real estate got obliterated. No

(24:11):
real estate got obliterated because you hadthe savings and loan crisis at that point.
The resolution Trust Company came in andbrought up a lot of or took
over a lot of underwater or failedwell savings and loans and sold off a
lot of commercial real estate and youknow, apartment buildings and the like.

(24:37):
And we'll say different, I'll saygroups of individuals or small companies who had
cash available and they made a killer. That's gonna be different this time is
I think there's still there's always akilling to be made now, whether there's
an RTC, and I think we'regonna need an RTC when this is all
said, then we're gonna lose afew more banks that thanks that we've lost

(25:00):
already this year, Silicon Valley Bank, Signature Bank, First Republic. Guess
what, the Feds still holding alot of that paper. The buyers of
those institutions didn't take the entire lovebookcase. It's underwater now the FEDS are
holding over one hundred billion dollars ofpaper. They may be holding five hundred
billion by the time this is done. San Francisco real estate, Chicago commercial

(25:22):
real estate, New York commercial realestate, Oh oh boy. And that's
how by insurance companies and their investmentportfolios. That's just gonna be a work
as well as some pretty large institutions, whether it's Blackstone, black Rock,
oh, all sorts, that's whatI own a lot of them. I
mean, the math is really simple, which is a lot of commercial real

(25:42):
estate was bought or refinanced assuming somewherebetween a four and five percent cap rate.
Some of the best New York commercialstuff was a three percent cap rate.
Now they got to those cap rates, which is just you know,
it's an in person a phe multipleat higher higher occupancy. Well, everybody's
well aware that occupancy for commercial realestate downtowns is a hack of a lot

(26:07):
lower, and obviously rents with it. So what we're looking at is really
the wholesale destruction of the equity portiona lot of these deals and a lot
of the loan portion, especially ifthey have multiple tranches of debt via first
mortag second mortis third mortgage. Alot of that debt is impaired, and
this is going to take a wildwork through. It doesn't mean that downtown
New York, downtown Minneapolis, downtownChicago, or downtown San Francisco isn't going

(26:32):
to revitalize and find a way.Certainly downtown Detroit in a nice twenty years
story. But that's the problem.It's a twenty years story. So that's
a long story. Well, Iwanted to bring this up because I happened
to notice a reek that was runby an old neighbor of yours, Barry
Sternwick, at Starwood Capital. Whenthey came out with their earnings down to

(27:00):
not too long ago, the stockdropped from about eighteen dollars a yeare down
to sixteen. This is a primarilya mortgage reets. What a mortgage read
is it's a real estate investment trustthat the assets are our mortgages, they're
not actually buildings. And you knowthis, This particular reet, under current

(27:23):
prices has got to yield just undereleven percent, So the whole do not
number one one of our number onerules. We have a lot of number
one rules. When the yield lookstoo good, to be true. It's
too good to be true. NowI want to I want to bring this
up because very stern, which hasbeen a very sharp and shrewd real estate

(27:45):
investor for a very long time,I would not put him yet on the
same I'll say, same plateau asSam Zale of Equity real Estate who recently
passed away and seem Yeah, greatguy was known iconic, classic great guy

(28:06):
as the Grave Dance. It wasthe great Danswer from the sixties and seventies
because he bought a bunch of businessesin a bunch of real estate when it
was in deep, deep trouble andhe revitalized it. But now i'd bring
it, bring up Barrett Barry sternly. Yeah. It was. One of
the things that happened on his conferencecall was Kim talking about the amount of

(28:29):
cash that they have in their portfolioand available to go out and buy both
mortgages and buildings on the on thecheek. And we're not talking about,
you know, a million dollars ofcash. We're talking over a billion dollars.
And that to me looks very interesting. It's there's gonna be a lot

(28:55):
to buy. The problem with thestar Wood that takes TWD or any of
these things. The problem that Istruggle with, and the banks have it
the worst is you're really excited aboutto go forward, correer. You really
wish that you could buy just togo forward without buying as well the legacy

(29:18):
correct. And that's the problem.And Steve Robin, the big New York
developers Vernado ticker VNO have some water. Look at you. You know,
I'm a little bit worried about you. There have some water. Okay,
you really want to buy going forward, and it's really hard to find something

(29:38):
where you get to going forward andyou don't have to accept buying what they've
done to get here. And that'sthe problem. So I it's great positioning,
I think very stern like he isgoing to make a lot of money
with all his new funds, butyou got to find out. You gotta
find something clean, and we've struggledso all the stuff. It's just kind

(29:59):
of wait and see and wait waitfor it to play out. And that's
that's right, be there. It'sgonna get worse before it gets better.
As my guess. Well, Iwant to just touch on one other,
you know, big time investor who'sgetting his his his skid, his sale

(30:21):
is um Carl. I care who'spublicly treated fund and he is the majority
share hole of it. I epLook, it's good that the stocks guy
not a lot lord. Carl's losta ton of money. Whatever he does
is unclear. There's there was abig short report a couple of weeks ago.
It looks like he's in a worldof trouble. But you don't know

(30:42):
how much money he has outside thatfund. People say he's gonna get margin
called. I don't know how youcan margin call him if you're the margin
lender. He made the mistake oflending against the liquid stock and he's got
ninety percent of it. If theyif they easy stock to sell it,
they're gonna lose a lot more money. They got to work with them.

(31:03):
But we'll see. I don't thinkthat story is over. It doesn't really
impact a lot of stuff. No, but I think that's a very interesting
story. Let that be a lessoneverybody. Don't get don't over lever a
liquid stuff. Well, that isone thing that we don't do. Please
stay away from leverage period relating toyour portfolio, and leverage can be in

(31:26):
the form of being out on marginor it could also be taking excessive risk
in the options market. Do giveus a call nine five two nine two
five five six oh eight. That'snine to five two nine two five five
six oh eight. You always getat straight talk, not sure coded advice.

(31:48):
I am Josh Arnold, mister moneytalk with Judd Arnold here to help
you. This is Josh Arnold missedor money talk with Judd Arnold here to
answer your questions on stocks, bonds, mutual funds. You should position your

(32:09):
investment dollars including your IRA and fouroh one K. Don't hesitate to give
us a call at nine five twonine two five five to six o eight.
That's nine to five two nine twofive five six o eight. You
always get straight talk, not sugarcoatedadvice. Very interesting. Also, not

(32:35):
only do we have some of thesemiconductor companies reporting earnings this week that did
very well, two in particular Navidia, and then on Thursday, that was
on Wednesday night, and on Thursdaynight Marvell came out with their report.

(32:58):
Marvell jumped, so hit stock gofrom forty nine dollars a share at the
close on Thursday night the closing onFriday at sixty five dollars a share.
Yes, they both beat and raised, but they talked about artificial intelligence,

(33:20):
and as we said at the beginning, anything that seems to be around artificial
intelligence is getting a big, big, big boost. We also had this
past week some retail earnings, andwe have more retail earnings coming in in

(33:42):
the next week. And the retailearnings were very, very mixed, and
it can give you a will say, strange view of what is actually going
on in terms of UM we'll sayconsumer consumer behavior. On one hand,

(34:06):
you see a company like Deckers,which will say more a specialty retailer,
and I've never understood some of theI'll say that the desire to own or
where TeV sandals or Ugs boots.But Deckers also is big into Hoka shoes,

(34:31):
which have been very hot athletic shoes. Deckers continues to print print money,
and you know, both Ugs andHoka are higher, higher end shoes,
and the stock continues to work goingforward. Dick's Sporting Goods another beat

(34:55):
and raise UM quarter, big timebright spot on what they've what they've accomplished
their stock or they keep saying,athletes continue to come into their stores and

(35:15):
that's all kinds of athletes. You'vehad some other stores that seem to be
more on a turnaround, such asas Gap Gap stores and doing a turnaround.
And you had Best Buy, whichbeat on the earnings, they missed

(35:37):
on the revenue. They said salesof electronics are are difficult. But a
number of analysts have come out andsaid, hey, that electronics move over
the next year is going to turnand Best Buy is still the only electronic

(35:57):
retailer out there, and they've theirprice target well over one hundred and I
think it's one hundred and ten dollarsstock trading at in the low low seventies.
But then there is a Dollar Tree, which should be a you know,
a big beneficiary of a slower economy. This is first order of thinking.

(36:22):
I just that's all right, butyou can have my first order thinking.
I think my my point to talkget to have a budget. Yeah,
because it's budget, I know,but I'm just going to bring out
the dollar. Dollar Tree missed topline, bottom line, guided down.
And one of the big things thatthey based on now dollar Tree also is
a turnaround institution, but they addedto to something that targeted at it added

(36:45):
too, and that is shrinkage continuesto go up, and I've seen that
with other retailers being concerned about thisis a This is a real time for
retailers. That's what it is.Shrinkage is higher and supply chain inflation.
It's a tough business. It's abusiness with low margins and lots of inventory

(37:07):
turns. And these dollar stores inanyway, I mean they were the Darling
ten years ago. My whole pointis this shrinking shrinkage. Your shrink shrinkage
is up, and they're going tobe a lot of areas that are going

(37:28):
to be losing losing stores just becauseof the shrinkage. And that was mentioned
not only by by Dollar treat butdefinitely by Target and Walmart. So as
you can say the number of retailersis going to or physical stores. I
mean, it's really crazy. Theshrinkage in the United States is now approaching

(37:49):
emerging market levels. That's another wayto say it, Okay, I mean
it's a little bit sad. Youknow when people say America is the third
bold country, Well, according toshrinkage, which is people's people stealing from
stores. Uh, the quantity ona quantitative basis, just looking at the
numbers we kind of we are,which is and the shames. It's happening

(38:10):
primarily in urban areas, not somuch in uh suburban or rural areas.
But you can debate and the peopleand who's the biggest loser the people those
urban everybody has to pay the taxof higher prices to offset the shrinkage.
It's not a victimless crime. Butyou know, I'm preaching to the choir,
so the yes, yes you are. But again, I think my

(38:34):
point is if you're even looking inretail, which has just been hurt,
I don't like. Right, Well, let's talk about this is another one.
We last week talked about media andhow terrible it is. I don't
want to touch anything in media.It's too hard. I can't figure it
out. Who's gonna win. Youknow, let's just gets you talk about
media that just gets gets worse bythe by the day. Those I mean
Paramount, which is a cop mergerof Viicon and CBS no return for twenty

(38:59):
years. Oh, it's been beenoff and Sherry Redstock just had to bring
in minority investors to help shore herup because she's over levered. I mean,
she might have to dump everything.So anyway, there's a lot of
places that you don't want to touchin this market. You don't want touch
banks, you don't want touch retail, you don't want to touch media.
It's hard. Energy is not working. Although I'm sticking with I'm sticking with

(39:21):
my guns with energy. I thinkthey're too cheap. But oh, energy
definitely is too cheap. Nobody care. We had a bunch of hold on
if it's so, it's so cheapthat You've had a number of mergers in
the in the oil and gas space. RG mergers look like they're going to
be a creative Chevron or Chevrod.Start of the week with a nice merger

(39:42):
of PDC, and you had CDrill and Board Drilling report this week is
blow out numbers, great green commentary. Those that's offshore, all of these
stocks, anything that that's economically sensitiveand quote unquote cyclical. The people who
own it think they're paying nothing andthey're nobody. There's no new money flowing
in. And that was sort ofhow we started the show, which is

(40:04):
all the stuff, all the moneyhas flown to the biggest stocks. That's
gonna keep flowing there as those keepworking. And other than that, there's
not a lot of new money cominginto equities. So the other, the
other, the other point that Iwant to make is, no, there
is not a lot of new moneycoming in. There's still a lot of
cash on the on the sidelines.And most advisors, at least that I

(40:24):
can I can see just listening evento a fin TV have been very heavy
on recommending stuff like bonds, valuestock, private equity. Yeah, all
the credit, I'll lose it.I'll lose it. So the SMP five
hundreds up on was nine point eightpercent of the year, the equally in

(40:45):
SMP five hundred down for the yearsdown like point two percent. That ten
percent spread is one of the biggest. It's going to be one of the
bigger spreads that we've seen in along time. And the underperformance of active
management. Not us, We're overwe were in concentrated Apple and Amazon and
a few others, but the underperformanceinaggregate of mutual funds and active management.

(41:09):
This is gonna be one of theworst years versus the index. It already
is. I'm saying it's probably gonnaend up that way, so so be
it. Well, we'll keep We'rehere to help you, and definitely we
we think much different or differently fromfrom the crowd. And if you want

(41:30):
a different point of view, giveus a call. Nine two nine two
five five six h eight. Thisis Josh Arnold, mister Money Talk with
Judd Arnold here to help you.But before we go, it is Memorial
Day weekend. I do want touh make a comment, as I've done

(41:53):
every year on radio at Memorial Dayand on Veterans Day. I give a
shout out particularly the family and friendsof my high school classmate who was killed

(42:15):
in action in Vietnam in March ofnineteen seventy, Corporal William Calmly, and
to those who have served, includingour parents and grandparents. We'd like to

(42:36):
honor them this weekend. Josh ArnoldInvestment Consultant is a registered investment advisor located
in the state of Minnesota. Allsecurities discussed are for informational purposes only.
Investing contains risks, including risk ofloss. Consult your investment professional before making
any decisions about your investment portfolio.