How Low Can Stocks & Crypto Go? October 27th, 2025

My first rule of money... Never let your money and emotions cross paths. This story is a weekly wake-up call to show you the near-worst-case scenario for stocks and crypto.

Episode Transcript

Speaker 1 (00:03):
Your new day starts with the Brian Mutshow, the news
You need to start your morning in the pom Beaches
and the Treasure Coast. Hello, and stocks and cryptocurrencies go.
My first role money is it is never let your
money and emotions cross paths or else what, Oh my gosh,
bad things. Probably less money, Probably less money. Over ninety

(00:24):
percent of the time. Statistically, people jump in and out,
they try to time investments markets, they do worse so
that they just let their money alone where it was
invested in the first place. And I think we're in
one of these moments right now that is highly instructive
in this regard. So this is where we ended trading
on Friday. Fox's Angelo Bavarro.

Speaker 2 (00:46):
Stucks closing at new heights after an encouraging inflation report
boosted optimism that can maintain its rate cutting course. The
September consumer price report showed prices were up three percent
from a year earlier, slightly less than what experts had expected.

Speaker 1 (01:01):
Now Here we are, Joel day twenty seven partial government shutdown.
What would your expectation have been if we were essentially
a full month into a partial shutdown? When you expect
the stock market to have said a series of record
heighs throughout.

Speaker 2 (01:16):
This Based on the media coverage of this shutdown thing,
I would expect that the market would be in a
free fall, honestly, right.

Speaker 1 (01:24):
And so this is again the disconnect between what might
make sense. You could think that, hey, I'm making a
good decision because if this is going to really drag
on the partial shutdown, this can't be good for the
economy or for stocks. That's what I'm hearing everywhere. Make
those emotional mistakes. There you go, so you get to
the sidelines. You miss out on record returns precisely, so

(01:47):
you know, even thoughtful analysis does not necessarily equal actual outcomes.
And so when we take a look at what's happened
for the past week, we had two percent gains across
the board for the major indexes DALLAS and P five
hundred and nWo year to day gains now anywhere from
eleven to twenty percent based upon your index of choice.
And so, yeah, stocks did move to recordize it again
on Friday, as inflation came in the lighter than expected,

(02:10):
earnings continue to be stronger than expected, and we are
also seeing that the overwhelming likelihood that the Federal Reserve
will be cutting interest rates on Wednesday. You put all
this together, give you an idea about the CPI, the
consumer price index, it should inflation. As you heard the

(02:32):
report pacing three percent over the past year, it was
still higher than August. That was lower than expect expectations,
So I mean that regardless decent. However, excluding food and
energy prices, the annualized rate would have been two point
six percent. That was not only lower than expected, but
that was also lower than the inflation rate in August.
And a lot of times if you take a look

(02:53):
at that what is called core CPI, that ex food
and energy number, it's bs because we do eat food,
we do consume energy, so that's the real cost of life.
The reason why it's more relevant in the conversation right
now is if you take a look at the period
that we're talking about, prices from August into September. While
energy prices are lower now than they were during that

(03:15):
comparable time, So if the core number was two point
six percent, that's we're pacing, probably in real time from
three percent down to two six maybe even less. And
so that is why the lower number is relevant in
this case. And so you've got a lot of optimism
around this stuff. As for earnings, through Friday, twenty nine

(03:35):
percent of companies had reported the average increase in earnings
year every year nine point two percent. The expectation coming
in was seven point nine So that is a solid
earnings beat on the aggregate so far. And then you
take a look at the Federal Reserve interest rate policy.
Investors have now priced in a ninety eight percent chance
of a quarter point cut on Wednesday into the market.

(03:58):
Here's the next thing to get an eye on. We
are seeing a massive pre market rally, so we close
the record highs. We're getting ready to set all kinds
of record high yet again today in the market on
a couple of things. The optimism about the trade progress
that's been made by President Trump over the weekend, also
the improving rhetorics surrounding the Chinese trade negotiations are going

(04:23):
to take place on Thursday in South Korea between President's
Trump and she and the Argentinian elections, Javier Melae hit
one big and people are not expecting him to. And
that is also really good news economically for the country
of Argentina, and so that provides a tailwind to us

(04:43):
as well. We have been involved in propping up Argentina
on their currency here of late. So you take a
look at what's going on here with the cryptos over
the past week. They had a good week along with stocks,
gains anywhere of three to six percent based upon your
cryptocurrency of choice, gains your to date anywhere nineteen to
twenty percent. Now, I can't provide any analysis for cryptos

(05:06):
in terms of value because they have no inherent value,
but it can for stocks because they do. Using the
S and P five hundred as the benchmark, if only
fundamentals and nothing else mattered, your maximum downside risk from
here is forty nine percent. It's a little bit higher
than last week. It's also the most expensive stocks have
been this cycle. Now, does that mean that I expect
a forty nine percent sell off if we had a correction?

Speaker 2 (05:28):
No?

Speaker 1 (05:28):
Is it possible in theory. If it happened and it
wouldn't negatively impact you in the day to day, great,
if what time for a new plan, if necessary, a
pro to help you with it.