August 1, 2024 • 43 mins
We've heard the Fed speak, and the earnings season report. The Marketing is weakening, and frankly we told you so. Host John and Giuseppe have the latest on the financial markets, news that affects your money, and three solid recommendations for a secure retirement. The Wise Money Guys.
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Episode Transcript
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Speaker 1 (00:00):
The Wise Money Guys Radio Show is brought to you
by One Source of Wealth Management SEC licensed three one
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our website One Source WM dot com or call nine
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Speaker 2 (00:16):
Welcome to the Wise Money Guys Radio Show. I'm your
co host, John Scambery, and I'm here with my partner
extraordinaire Just Happy Visconsin. And we are certified portfolio managers
that specialize in helping people who are retired are about
to retire manage their money. If you like the show
and want to get together with us for a no
obligation consultation, or if you have any questions, give us
(00:37):
a call at nine one six nine six seven thirty
five hundred and leave us a message again that numbers
nine one six nine six seven thirty five hundred. We
have an exciting show today because we are going to
give you some specific investment ideas and investment strategies towards
the end of the show. So you must keep listening
(00:58):
because these will absolute help you navigate what is happening
right now, because that's what's important. There is so much
uncertainty every single day in the news in our country,
around the world, you name it. So it's never ever
the wrong strategy to try to be proactive and stay
(01:20):
ahead of what's going on or potentially could go on.
And so let's get going by talking about what we
said was going to happen, which was that the large
growth companies, the certain you know, portion of what people
call the market, whether that's the Nasdaq one hundred or
(01:43):
the S and P five hundred was overvalued and you
potentially should lock in some profits. And sure enough, what
have we been seeing over these last couple of weeks,
really almost the entire month of July, you know, growth
stock and these are stocks that don't pay a dividend,
(02:04):
but you know, really lead the market in their particular
sector have been nothing but either you know, super volatile
or have lost money off of their highs.
Speaker 3 (02:17):
Recently. Yeah, recently, I've had a big run up, and
then we've entered volatility season, which is typically back half
of July and goes into the first week of October.
When you look at the past thirty four years of
market history, and that's exactly what's happened, and it started,
you can say this is the catalyst or that's a catalyst.
(02:37):
But if you look at the past few weeks and
what took place, it started with a tech sector with
some commentary from Trump and Biden regarding just you know,
tougher measures on China, and so the chip stocks got hit,
you know, the AI, Darling and Video and SMCI and
all these high flyers. But then we had some earnings
(03:01):
because we're in the thick of it and earning season
and Google, you know, because the whole push has been
AI AI AI. But Google came out and said, hey,
we're spending a lot of money on AI and we
haven't seen the matches in revenues yet, and so that
sparked a little concern.
Speaker 2 (03:20):
Though they beat both revenue and earnings expectations.
Speaker 3 (03:24):
Yeah, right, but that's what happens. And also it's healthy
for the market. And we've been talking about, you know,
it's it's a little overdue for some sort of correction
or pullback. And interest rates have been high and they've
been coming down. We had a FED meeting this past week,
so we'll talk a little bit about that, you know,
(03:46):
our thoughts where we think things are going to be going. Also,
the ECB had cutting rates that was in the past.
Think of England recently cut rates, So does that mean
we're going to be cutting rates.
Speaker 2 (04:00):
Let me get off on a soapbox, or let me
get on a soapbox from here because rates Now, we've
been saying for months and months that not only should
there not be six or seven rate cuts, there shouldn't
be any at all, because the real issue is that
(04:20):
we've given way too much power to one person and
one unelected a committee of people to decide what happens
economically to our country and really the world, quite frankly,
and many of those things and the measurements that they
use you cannot trust. For example, personal consumption expenditures, which
(04:44):
is the favorite barometer of inflation used by Jerome Powell,
strips out food and energy, and you know it also
doesn't take into consideration the increases in insurance, whether that's
homeowner's insurance or health insurance or auto insurance. You know,
you take those things out, food, energy, and insurance, the
(05:08):
data is worthless. So the simply say, oh, look, inflation
and prices have stabilized at two point seven percent is
so misleading and factually wrong that you can't trust what
our government is going to do. You can only trust
what money is doing where is money going. And that's
(05:31):
part of what we're going to talk about today because
another thing that we've been right about and trying to
get people to do, certainly doing it with our clients,
but also talking about it on our radio shows is
the gift of higher interest rates, and that that gift
would not last long because whether you know, you're in
(05:52):
support of what the government is doing and you believe
their data that you you know, says, oh, we're going
to make restrates lower, which by the way, was a
mistake made in twenty eighteen. They backed off raising interest
rates then and we went into recession. But more importantly,
we then saw government spending go even way beyond obviously
(06:17):
where it was prior to twenty twenty. And then we
all know what happened in twenty twenty. But here's the thing.
We have not stopped any of those fiscal policies. We
are still printing money at the rate of trillions that
we don't have, that we're borrowing from taxpayers, that we're
putting on the balance sheet of the federal government, which
(06:38):
is really the balance sheet of every man, woman and
child in America. That has to be paid back at
some point, and God help us if there's any sort
of default in our debt, but our debt currently where
it is right now, the payments on that are potentially
more than what it costs to run the military, the
entire military, more than what social Security or medicare costs.
(07:02):
And if interest rates go higher, that will completely bankrupt
the system and potentially the world, which is why they're
so hell bent on trying to get in to interest
rates lower, because they know that fiscal policy has not
stopped any of the deficit spending and any of the
increase to the debt on an annualized basis, and it's
(07:24):
only going to get worse because then you have these
idiots that are in power that now want to forgive
at a cost of one point eight trillion dollars student loans. Now,
how is that fair, Giuseppe? Not for your college? Right?
I paid for three kids over fifty years to go
to college, two traditional colleges, one with the masters, and
(07:49):
one vocational college. And so now I have to pay
for people who chose to get degrees in things that
couldn't give them enough money when they're working to pay
back that student day. That's my problem, so my fault.
Speaker 3 (08:02):
Could you save that receipt and then write that off
on your jaxes.
Speaker 2 (08:05):
Let me tell you right now, and again we're going
to get into you know, interest rates and a specific
investment idea here in a moment. But let me tell
you who should be paying back students. It's these ridiculous
universities that are overcharging the students. They're supposed to be
(08:26):
not for profit, yet their profits are in the billions.
And now you see, because they're not for profit, endowment
funds which is just really a place to put their
profits that has surpassed a trillion dollars. So if you've
now charged a child, who I guess as an adult
when you go into college, you know, fifty thousand, one
(08:49):
hundred thousand, three hundred thousand for some degree that projects
them to make thirty forty fifty thousand dollars a year,
the university should be refunding them the money, not borrowing
the money to then have taxpayers be responsible for that.
That keyword being responsible that you know, make money that
(09:10):
paid for their college or didn't go to college and
own businesses so on and so forth. Strap it to
the universities re reform university proke because when I went
to college, which was in ninety one, No, I got
out in ninety one. God, that's been a long time already.
The cost of a semester was two hundred and ninety
(09:33):
seven dollars for state school tuition. It's now ten thousand
or more, not for books, in living or any of that,
or parking or food. No, ten thousand. Now, if you
take that inflation rate, it's tens of thousands of percent.
That wages did not go up by tens of thousands
(09:54):
of percent since then. And that is the problem with
the system, is that you universities have increased their cost
way beyond any measure of financial prudency that that you
could utilize. And so, first of all, I want to
(10:14):
once again say that we said that you know rates
were going to go down, and that the gift of
high interest rates is high interest rates, meaning if you
don't have a lot of debt, you know, you're retired,
your your your house is paid off, you have no
car payments, so on and so forth, your expenses or
at the lowest they've ever been, then high interest rates
(10:37):
are gift because you can get a high rate of
return fixed on your money. That window is closing. The
prices for stocks were high, and we started saying take
advantage and lock in some profits on your stocks and
buy bonds because the prices of bonds are low. Well,
the prices of bonds have been going higher because interest
(10:58):
rates are going down. It's still not too late though
to get some and we're going to give you a
specific one Deutsche Bank the July twenty thirty four expiration
six percent. This is an investment in grade individual bond
that Deutsche Bank is raising money by offering its bond
(11:22):
holders a six percent return. Now the yield to worst
has gone down to five point six point nine, and
that's because the price is now gone up, the price
to buy that. And this is just one example that's
still a great return Dusseppi. It's it's don't put all
(11:44):
your money in this one bond. But again don't wait,
don't wait to lock in profits that continue to go
down in the form of your share prices of your
your stocks that went up in twenty three and twenty
four are now coming down well.
Speaker 3 (12:00):
In in a balance. You know, in a typical retirement portfolio,
you're not going to have one hundred percent stocks. You're
not going after all this growth. You're going for a
balanced approach typically, and you want to have some interest
and dividends being produced out of that portfolio to help
supply you with a stream of income. And you know,
(12:21):
if you can get five percent six percent out of
a bond and have that for the next two, three,
four or five ten years, if you're lucky, yeah, how
as long as you want. Really, because interest rates have
been coming down. I mean I was telling John just
this past month or you know, six weeks. I have
(12:41):
a set of criteria that I search for bonds periodically
to see what's out there. Anytime, you know, we're adding
to client portfolios or swapping or maybe a new client
comes in and before you know, with the criteria to
have a minim of a five percent interest rate, been
them a five percent yield to worst and yield to worst.
(13:05):
All that means is if you figure out, hey, I
paid this much to get into the bond, I am
receiving this much in interest every year, and then when
it matures on its maturity date or it gets called
which means is just mature earlier than it's maturity date,
you get your principle back. And if you add all
those numbers up and say, hey, I've had this thing
for three years, would it actually earn an annualized basis?
(13:28):
That number represents the yield to worst so wellin the
parameters of my saved search list. Before when I hit search,
I would have twelve to fifteen pages worth of bonds
out there, so meaning I had a lot of choices
to put, you know, to kind of pick and choose
into and put them into portfolios. Now that same search
(13:51):
list is yielding three pages worth, so they're still out there,
but it's harder to come by. And if this continued on,
and especially with the rhetoric and the direction that the
Fed's going. The Bank of England just cut rates, European
Central Bank already cut rates, and the Fed and the
market is betting that the that the Fed is going
(14:12):
to cut rates in September. Yeah, yep.
Speaker 2 (14:14):
And we've seen the ten year treasury at a high
a five now below four. So interest rates have come down.
And quite frankly, this Deutsche Bank six percent bond, which
is investment grade, which means it's better than triple B minus.
And we believe that if you're retired, you should have
companies that are rated highly meaning investment grade versus junk grade.
(14:39):
Because you want to be conservative even in the bonds
that are in your portfolio, you also don't put you know, Okay, great,
I like a six percent coupon and a five point
seven percent yield. To worse, I'm going to put all
my money in that. No, if you don't know how
to you know, ladder your bonds into multiple different you know,
companies with multiple different maturities and yields, then then give
(15:04):
us a call at nine one six nine six seven
thirty five hundred. But this bond only has two years
of call protection, which is basically two years that you
know you're going to get that that six percent you
know interest rate. But after July twenty twenty six, Deutsche
Bank can refinance that away from you and give you
(15:26):
back your principle. Then the interest you've made is the
interest you've made anytime after July twenty six. So again,
if you don't really know you know, how to buy
individual bonds, please give us a call. More importantly, the
time is still better to own individual bonds because even
though the prices have gone slightly up, it's still better
(15:50):
than buying, say a bond fund where you don't know
you know, you have no principle guarantees, you have no
rate of return guarantee, so on and so far. So
give us call at nine one six nine six seven
thirty five hundred. The other thing I want to talk about,
Jo Seppee, is the rotation that we're seeing, and then
that will bring us to our second investment idea or
(16:15):
strategy for this show, and that is again we've seen
large growth companies hit all time highs, record high.
Speaker 3 (16:24):
It's been really the culprit and bringing the indices up
s and p five hundred and the NASDAC like we've
been talking about.
Speaker 2 (16:31):
And more importantly we've been saying and calling for, you know,
locking in some profit. A difference between a large growth
company and a large value company is typically that the
growth company doesn't share its profits if they have them,
and a large value company will tend to, you know,
(16:54):
financially fundamentally be at a price which is still a
good time to buy, but more importantly also pays a
dividend in the form of returning some of its profit
to its shareholders. So the first shift that we believe
you should be doing and that we have done and
(17:14):
focused on for our clients is focusing on the interest
rates they're receiving, i e. The Deutsche bond that we
were just discussing, or the dividends that they're receiving, because
the two components of total return are what income do
you receive from that investment while you're in it, and
(17:37):
then what does it potentially grow to above the price
that you paid. A lot of people have investments, whether
it's exchange traded funds, mutual funds, or individual stocks that
the only way you make money is it goes up
above a price higher than you paid, and then you
sell it for a profit. And if you don't sell
(17:57):
it for a profit, you've made no money because it
doesn't pay you anything while you own it. So our
second recommendation is to focus on large company divid in
paying stocks. And then one other recommendation is to look
for smaller companies okay that haven't you know, run up
(18:20):
as much as the large companies, but more importantly, look
for small companys that are undervalued. And again, if you're
doing this yourself or your advisor you know, just has
you in a basket of mutual funds and ETFs, then
a simple et f that you could do, and and
(18:42):
and the one that you know most people probably would do,
which is the rest of two thousand.
Speaker 3 (18:47):
Right, yeah, i WM, which you know, the the rotation
that you were talking about is people just pulling a
little bit off of the growth stocks and then putting
into small caps because when interest rates go high, that's
a that's a bigger burden for smaller companies, you know,
for them to try and borrow money, get business loans,
expand their business than it is for these bigger, large
(19:09):
growth companies. But i WM tracks are Russell two thousand
and so that's really the benchmark for the small cap
stocks that has run up, done very well, recently pulled
back this week, but it could be an opportunity to
get in if you if you thought you missed that boat,
now you know one thing to look out for. You know,
(19:33):
feds are going to be cutting rates. So one or
two things are gonna happen. Either they're cutting rates because
they are really successful in engineering a soft landing, or
they're starting to cut rates because the recession is brewing
and they're going to have to cut rates to stimulate
the economy. And if that is the case, then it
doesn't really matter of this rotation going on, then most
(19:53):
stocks are are going to be going down and pulling
back anyways. But for now you know one one that
but you know, outside of IWN and focusing more on
the value play. But you know, looking for a fund
instead of going through and just picking individual stocks.
Speaker 2 (20:09):
So this is a specific ETF that you could take
a look at as an idea.
Speaker 3 (20:13):
Right, is the Small Cap Value Factor Fund which is
SVL and they focus on small cap stocks but on
a value basis.
Speaker 2 (20:23):
Yeah, And so the difference between just doing IWM and
buying basically buying the whole wrestle two thousand is this
is more tactical. It's going to look for companies that
are actually making money that from a financial perspective, you
know fundamentally are a good price to get into those
particular companies, not just buying the whole basket of companies
(20:46):
that are, you know, by parameter small in nature, because
with that you'll get companies that aren't going to survive
a recession. So it's better in our opinion that again,
if your managing your own money or if you're working
with an advisor that just buys you Mutual funds and ETFs,
you know, to actually go more tactical and take a
(21:10):
look at SVA L instead. So if you're going it alone,
if you're in your sixties, seventies, eighties, and you're going
it alone and you're not taking advantage of the gifts
that we've been given, the opportunities that are presenting themselves,
please give us a call at nine one six ninety six,
seven thirty five hundred, get on our calendar for an
(21:33):
absolutely no obligation consultation, and on top of that, we
will do a written retirement plan analysis that we will
give you again with absolutely no obligation whatsoever, called nine
one six ninety six seven thirty five hundred. Why would
you want to do that? The best way? And again
here's some investment advice to tackle you know, uncertainty is
(21:59):
by having a play a plan that measures what success
means or what success is financially towards your goals and objectives.
Simply so, if you're living off of your retirement investments.
You know you've got social security, you have investments, and
(22:20):
you're relying on those for income, you should know what
percent return you need to get off of those investments
to give you the income that you need, and then
success obviously is after fees, after all costs, etc. Did
I achieve at least that percent return on those investments.
(22:42):
That should also be updated regularly, because if you haven't
done a plan, if you don't have those goals and
those objectives written down, then the the assumptions in that
plan are probably already out of date. Pecifically, what inflation
(23:02):
rate did you assume would be in those written plans,
What did you assume your expenses would be in the
future in those plans? So on and so forth. Those
things have changed so drastically in the last several years
(23:22):
that if it's been you know, prior to I would
say twenty twenty two, and certainly prior to twenty nineteen,
that you haven't you know, updated your financial plan, or
you don't have a financial plan at all, please call
us at nine one six ninety six seven thirty five hundred,
because we will show you that how how that will
(23:43):
help you be more successful in the future, and it
is included in what we do. It's included in our
advisory fee. As fiduciaries. We don't charge you separately for
written financial planning. We do that included in our fee,
and so a couple of things first and foremost, you know,
(24:04):
update your plan or come get a plan if you
don't have one. More importantly, start looking to shift the
type of stocks that you have from large growth to
large value or mid or small company size. Uh. That's
what we say when we're talking about you know cap,
you might hear people say large cap, small cap, mid cap.
(24:26):
That just means the size of the company. And we're
seeing that rotation from large to small. But there's a
lot of opportunity in mid as well. And many of
the utility and energy investments are middle sized companies that
pay great dividends. So look to rotate from large growth
(24:47):
to you know, small or mid value, especially companies that
pay dividends. Also, we gave you a specific you know,
a bond because we like individual bonds and the prices
a still good. So recommendation or sales idea, you know
number two investment idea. Number two was you know, by
(25:09):
the Deutsche Bank, you know, uh, investment in grade bond
paying six percent with a yield to worst of five
point seven five point six ninety seven. If you want
to be exact before those prices on ones like that,
go even higher. More importantly, don't let the the surprise
(25:31):
take your portfolio down. What I mean, there is a
surprise coming in every you know, election cycle.
Speaker 3 (25:39):
A good surprise, like birthday surprise.
Speaker 2 (25:42):
Well, in every election cycle, there's always this you know
event that happens. It usually scares the heck out of
the markets. It changes you know, rates in the bond market,
and and and people wait till after it happens to
rebound their portfolio. And what I'm saying is, if you
(26:03):
are already let July happen and you didn't rebalance your portfolio,
don't let the October surprise that typically happens, you know,
cause you to react and then rebalance your portfolio. You know,
these these tell tale signs, these things that are happening
aren't gonna It's not going to get smoother from here, JOSEPPI.
(26:24):
I think the ride only gets wilder from here.
Speaker 3 (26:27):
We've already entered it. I mean, the back half of
July and go into the first week of October is
volatility season. So we are in the midst of it,
and you know, we have the rest of August and
potentially the beginning of October that volatility. Can you know,
continue to be elevated. So and you know there there's opportunity.
(26:48):
Like the small cap it's gone up ten percent, and
so maybe people are like, oh, no, I missed that boat.
I should have got into it. Well, it's recently pulled back.
Speaker 2 (26:58):
Yeah, last week it came like that val that we
were saying, it's down four percent of one day. Know,
it hit a high of around thirty six dollars per
share and then it was down to about thirty two dollar.
Not we're not giving you this exact price because as
long as the market's open, the price is fluctuating until
you buy it and then that's your exact price. But
(27:20):
now it has pulled back, and if there is a
rate cut, you know, it's a good time. If you
already have it, it's a good time two dollar cost average.
If you don't have it, it's a good enter entry point.
Speaker 3 (27:31):
And how much do you put this in your portfolio?
How much in the bonds are you put in your
portfolio at? How many different bonds do you buy? You know,
how big of a position. These are all questions and
things that we go through with our clients, and we
don't know who you are, your your means, your your
risk tolerance, your time horise and so and so forth.
So that's the due diligence you have to do on
(27:51):
your own and that's what we do with our clients
through financial planning and then construct and build out the
portfolio according to your goals, timeline, risk tolerance and what
you need. And if you're confused or you're thinking this
is too much, that's a great reason to give us
a call and we can help walk walk through that journey.
Speaker 2 (28:13):
With what is that number, Jiuseppe, I'm just curious if
you know it's nine Jenny, Jenny, Yeah, nine six seven
thirty five yep, nine six seven thirty five hundred. Again,
that number is nine one six ninety six, seven thirty
five hundred. Leave us a message and Kathy will call
you back during the week. You know, some of the
(28:36):
the energy companies, you know, I can't help, but always
revert back to the energy sector. I always think and
can prove it quite frankly, it's always one of the
top performing sectors because everything begins and ends with energy, right.
If there's no fossil fuels, if there's no natural gas,
if there's no nuclear you know, if there's no refining
(28:58):
of that getting it out of the around, shipping it
from you know, one place to the other, getting it
to the person who sells it to consumer, you know,
so on and so forth. There is no business in
the world.
Speaker 3 (29:09):
Yeah, and if there's if there's no coffee, I have
no energy.
Speaker 2 (29:14):
So the reality is, you know, we're starting to see
a little bit of a pullback, you know, off of
highs in the different energy and utility companies. And so
here's another time to where you could shift to from
a focused perspective. Okay, we've said go from large growth
to you know, companies that are maybe still large but
(29:36):
are undervalued, that pay a dividend, or they're smaller in
size and undervalued, probably don't pay a dividend. But here's
an opportunity to get into some of the energy investments
that do pay a dividend and consistently pay that divid
in year end, year out, because no matter what is
going on, you know, it always requires you know, more
(30:00):
energy each year, not less. You go, oh, well, ev
cars are gonna you know, take a bite out of
fossil fuels and nuclear. Wrong. No, In fact, the more
we go to electric vehicles and electric transportation, the more
fossil fuels will need the more nuclear will need the
(30:22):
more unfortunately, coal will need the more natural gas we
need because that is where the power comes from that
people get at their home, at their business, wherever they're
plugging those ev cars in. That's not being made by
the sun. Yeah, in my case it is because I've
(30:42):
got solar panels and then i plug my car in
at home, and our solar panels cover our total bill.
So technically I'm charging my electric vehicle off the sun.
But most people are not. Most electric, you know, one
of my electric equipment of any kind, whether it's a
(31:02):
car or a blow dryer or a microwave, is not
by wind, meals or solar. There again, by natural gas,
by fossil fuels, by coal, by nuclear. And so there
are great investments, and I'm going to give you one
right now that I really like, which is fr again.
(31:28):
That's Frontline PLC FRO, and it's it's in the transportation
side of energy, and it pays an awesome dividend. And
what was the price roughly last week, Jiuseppe, It was
in the it's been anywhere. Well, actually when I started
(31:48):
talking about it, it was, you know, thirteen fourteen fifteen
dollars per share that I'd say, hey, take a look
at this. I think it's going to be a double.
Then it went to about twenty nine dollars per share,
and now I think it's down in the round twenty
three or twenty.
Speaker 3 (32:01):
Four, twenty three, twenty yeah, twenty three, twenty fours kind
of the range. It's actually it actually touched like twenty six.
Speaker 2 (32:07):
And here's the best part. What is the dividend if
you pay projected on twenty three dollars and whatever? Again,
it depends on when you get in, you know, it
depends on the exact price you pay.
Speaker 3 (32:21):
Well, And the other part is how long has it
been paying dividends?
Speaker 2 (32:23):
Oh?
Speaker 3 (32:24):
Well, and that's the thing.
Speaker 2 (32:25):
This company has consistently paying its dividends basically since it
became a publicly traded company, and it has been paying
at a double digit rate for a very long time.
At the twenty three, no, twenty four dollars, let's say
it's around a ten percent annualized projected dividend. Dividends are
(32:47):
not guaranteed.
Speaker 3 (32:48):
Ten point one to be exact.
Speaker 2 (32:50):
But here's an example of a sector, you know of stocks,
the energy sector, you know, of an investment that can
afford to pay out its profits in the form of
a dividend two shareholders that also acts as a hedge
at at ten percent, because the market would need to
(33:11):
go down ten percent. This price would need to go
down ten percent before your principle has eroded after a
year's worth of dividends. So I hope you've enjoyed the
show so far. And the three investment ideas that we've
talked about so far is the Deutsche Bank six percent
twenty thirty four bond, the ETF sva L, which is
(33:37):
a small company of value ETF, and Frontline Plc FROO,
which is an energy transportation stock with a projected ten
percent dividend. Now, if everything we've been talking about solms,
whether it's the planning and updating your plan, or rotating
(33:58):
from large company owth to large company value or mid
value or small value, or moving a portion of your
money from stocks to bonds, you know, having an actively managed,
you know diversified truly diversified, which means low correlation portfolio
is crucial to you know the future and whether or
(34:22):
not you run out of money. If all of this
sounds overwhelming to you, it is if you're not doing
this full time, if you're not at your screen every
minute that the market is open, if you're not a
student of this industry, if you're not you know, listening
and researching all of the different you know, investments and
(34:46):
ideas and so on and so forth, and filtering it
all down on a daily, weekly, annual basis, you should
not be going it alone. Give us a call at
nine one, six ninety six, seven thirty five hundred. Just
because twenty three was good and twenty four is so
far good doesn't mean in one blink the market could
(35:09):
be down and your investments could be down twenty thirty
forty fifty percent in a blink of an eye. There
is nothing, you know, supporting why the markets or investments
should be higher, but there's everything supporting why they should
be lower from an economic, from a macro economic, or
a geopolitical perspective.
Speaker 3 (35:32):
And part of that test is earnings. If companies continue
to push healthy profits and forward guidance that's positive, then
that can you know, be the catalyst for the market
to continue to run up. But we've seen some of
that volatility, yeah, some mixed, and we've seen some of
the volatility be spurred, you know, specifically from Google and
(35:55):
all the AI spending that they've done, and the revenues
from all the spending that they've done has has not
come in to the same degree. So there's been some pullback,
some volatility in the market because of that and the
magnificency seven have seen it. I mean there's been a
down day and upday and then you know, oh all
over the place.
Speaker 2 (36:14):
I mean again, the Nvidia is. You know it it
reached a high, a pre split high of basically fourteen
hundred dollars per share or a post split high of
one hundred and forty dollars a share. And you know,
when I looked at it last week, it had been
as low as like one oh three to as high
(36:36):
as like one seventeen. But if you go from one
forty down to one oh three, I mean you're talking
about more than a twenty percent pullback off of its highs.
And if you were sitting in that stock and you went, oh, no,
I'm not selling it even though it's way overvalued and
doesn't support you know, a price of one forty, it's
(36:57):
going higher. I just know it is. I love this talk.
You're now going, God, I I'm panicking and wish I
would have sold the stock. And so again we talk
about these things to hopefully get you to not procrastinate
and just give us a call to come in and
have a conversation with us. We love what we do
(37:19):
and we love helping our clients. And even if you
come in and we just have a conversation that helps you,
we're super happy with that. If we decide that we're
a good fit and it makes sense for you to
hire us, we're happy with that as well. Either way,
don't wait for things to get even crazier. Call us
(37:40):
at nine one six nine six seven thirty five hundred.
As we talked about in the in the previous parts
of the show, there's there's more volatility to come. In fact,
one of the most volatile months, which means where the
market is going to cause pa is the month of October.
(38:03):
You throw that in with a potential election surprise or
any surprise you know on the national or world stage.
Already had a couples, right, We've already had a couple
in a foreign That's what I mean. And gosh, I
hate to see people where you know they had huge
profits and now all of a sudden, they don't have
(38:24):
those huge profits anymore because what they were worried about paying.
Our average fee is one percent. Now some people pay more,
some people pay less. It just depends on the size
of your relationship with us. But really you're going to
go it alone because you don't want to potentially pay
one percent. One percent is typically one seventh of what
(38:50):
an annuity person gets paid up front when you buy
an annuity. It makes no sense to buy an annuity
and lock your money up for six to ten years
at a seven percent upfront commission, when that is seven
years of our average fee of us being hired by you,
working for you, trying to help you accomplish whatever your
(39:14):
goals and objectives are on a proactive, like I said,
not a reactive basis. For guys that have almost a
combined fifty years of experience called nine one six ninety
six seven thirty five hundred, this is when it matters
and are you paying a low price that has value
(39:34):
and upside in it, or are you still paying too
high a price. That's the research that you need to
be doing. And the one that I gave that the
Frontline was just one example of where there's upside value.
But even if there wasn't, even if it just hovered
around twenty three or twenty four dollars per share, that
ten percent dividend is a phenomenal return on investment. Well
(39:58):
was twenty nine just back in and nothing fundamentally has
changed for that company. Their earnings didn't go down, they're
not making less money. The need for what service they
provide hasn't changed. It gets bigger every year. It's just
down in lockstep with the uncertainty of the overall macro
(40:19):
economic environment that we're in. And so that is when
you gobble up more of companies like that. That's when
we gobble up more of companies like that for our clients. Now,
is there an AI stock that you could get in
right here? Is there one that is showing signs of
(40:41):
being undervalued and oversold? And I think there is Giuseppe
and Giuseppes even looking at me. But the indicator, the
PEG indicator, is showing that this company is over sold
and undervalued. And this is a huge tip people. Now again,
(41:02):
I don't know if it's appropriate for your portfolio. We
don't know who's listening. But if you're wanting to get
an into the AI potential sector of stocks, then you
should take a look. Now, do your own research. Again,
this is a very volatile, still expensive stock, but based
(41:23):
on its financials, based on its PEG ratio, based on
its PE ratio compared to Nvidia's PE ratio, what about
and R two D two, this is looking like a
good time to buy this particular investment. And it is
super micro computer. This thing in the last you know,
(41:47):
few months, has been you know, from from six hundred
roughly to you know, over a thousand, and here we
are back down into the sixes. I bought some more
of it for for personal accounts when it was around
you know, six point fifty nine, and I think it
hit a low of below six point fifty last week.
(42:11):
Again not looking at it right now, but it was
at a fifty two week high literally over a thousand.
Speaker 3 (42:19):
But again, if you lose.
Speaker 2 (42:20):
Over twelve hundred at one point at twelve hundred and so,
well that's definitely over a thousand.
Speaker 3 (42:27):
Well it's basically, I mean it's range. It's fifty percent, yeah,
you know it. It touched over twelve hundred and it's
in the six hundred so.
Speaker 2 (42:36):
And compared to other AI chip stocks. It has a
low pe, it has a low peg. It's a good
time to dip your toe in it. Well, I hope
you liked all of our investment ideas on this show.
You've been listening to John Scambray and to Seppi Veskani,
the Wise Money guys. Have a great weekend.
Speaker 3 (42:59):
Talk to you next week.
Speaker 2 (43:00):
The first Story report Tim, then Stan
The Wise Money Guys Radio Show is brought to you
by One Source of Wealth Management SEC licensed three one
nine zero seven eight. For disclosures and more information, visit
our website One Source WM dot com or call nine
one six nine six seven thirty five hundred.
Speaker 2 (00:16):
Welcome to the Wise Money Guys Radio Show. I'm your
co host, John Scambery, and I'm here with my partner
extraordinaire Just Happy Visconsin. And we are certified portfolio managers
that specialize in helping people who are retired are about
to retire manage their money. If you like the show
and want to get together with us for a no
obligation consultation, or if you have any questions, give us
(00:37):
a call at nine one six nine six seven thirty
five hundred and leave us a message again that numbers
nine one six nine six seven thirty five hundred. We
have an exciting show today because we are going to
give you some specific investment ideas and investment strategies towards
the end of the show. So you must keep listening
(00:58):
because these will absolute help you navigate what is happening
right now, because that's what's important. There is so much
uncertainty every single day in the news in our country,
around the world, you name it. So it's never ever
the wrong strategy to try to be proactive and stay
(01:20):
ahead of what's going on or potentially could go on.
And so let's get going by talking about what we
said was going to happen, which was that the large
growth companies, the certain you know, portion of what people
call the market, whether that's the Nasdaq one hundred or
(01:43):
the S and P five hundred was overvalued and you
potentially should lock in some profits. And sure enough, what
have we been seeing over these last couple of weeks,
really almost the entire month of July, you know, growth
stock and these are stocks that don't pay a dividend,
(02:04):
but you know, really lead the market in their particular
sector have been nothing but either you know, super volatile
or have lost money off of their highs.
Speaker 3 (02:17):
Recently. Yeah, recently, I've had a big run up, and
then we've entered volatility season, which is typically back half
of July and goes into the first week of October.
When you look at the past thirty four years of
market history, and that's exactly what's happened, and it started,
you can say this is the catalyst or that's a catalyst.
(02:37):
But if you look at the past few weeks and
what took place, it started with a tech sector with
some commentary from Trump and Biden regarding just you know,
tougher measures on China, and so the chip stocks got hit,
you know, the AI, Darling and Video and SMCI and
all these high flyers. But then we had some earnings
(03:01):
because we're in the thick of it and earning season
and Google, you know, because the whole push has been
AI AI AI. But Google came out and said, hey,
we're spending a lot of money on AI and we
haven't seen the matches in revenues yet, and so that
sparked a little concern.
Speaker 2 (03:20):
Though they beat both revenue and earnings expectations.
Speaker 3 (03:24):
Yeah, right, but that's what happens. And also it's healthy
for the market. And we've been talking about, you know,
it's it's a little overdue for some sort of correction
or pullback. And interest rates have been high and they've
been coming down. We had a FED meeting this past week,
so we'll talk a little bit about that, you know,
(03:46):
our thoughts where we think things are going to be going. Also,
the ECB had cutting rates that was in the past.
Think of England recently cut rates, So does that mean
we're going to be cutting rates.
Speaker 2 (04:00):
Let me get off on a soapbox, or let me
get on a soapbox from here because rates Now, we've
been saying for months and months that not only should
there not be six or seven rate cuts, there shouldn't
be any at all, because the real issue is that
(04:20):
we've given way too much power to one person and
one unelected a committee of people to decide what happens
economically to our country and really the world, quite frankly,
and many of those things and the measurements that they
use you cannot trust. For example, personal consumption expenditures, which
(04:44):
is the favorite barometer of inflation used by Jerome Powell,
strips out food and energy, and you know it also
doesn't take into consideration the increases in insurance, whether that's
homeowner's insurance or health insurance or auto insurance. You know,
you take those things out, food, energy, and insurance, the
(05:08):
data is worthless. So the simply say, oh, look, inflation
and prices have stabilized at two point seven percent is
so misleading and factually wrong that you can't trust what
our government is going to do. You can only trust
what money is doing where is money going. And that's
(05:31):
part of what we're going to talk about today because
another thing that we've been right about and trying to
get people to do, certainly doing it with our clients,
but also talking about it on our radio shows is
the gift of higher interest rates, and that that gift
would not last long because whether you know, you're in
(05:52):
support of what the government is doing and you believe
their data that you you know, says, oh, we're going
to make restrates lower, which by the way, was a
mistake made in twenty eighteen. They backed off raising interest
rates then and we went into recession. But more importantly,
we then saw government spending go even way beyond obviously
(06:17):
where it was prior to twenty twenty. And then we
all know what happened in twenty twenty. But here's the thing.
We have not stopped any of those fiscal policies. We
are still printing money at the rate of trillions that
we don't have, that we're borrowing from taxpayers, that we're
putting on the balance sheet of the federal government, which
(06:38):
is really the balance sheet of every man, woman and
child in America. That has to be paid back at
some point, and God help us if there's any sort
of default in our debt, but our debt currently where
it is right now, the payments on that are potentially
more than what it costs to run the military, the
entire military, more than what social Security or medicare costs.
(07:02):
And if interest rates go higher, that will completely bankrupt
the system and potentially the world, which is why they're
so hell bent on trying to get in to interest
rates lower, because they know that fiscal policy has not
stopped any of the deficit spending and any of the
increase to the debt on an annualized basis, and it's
(07:24):
only going to get worse because then you have these
idiots that are in power that now want to forgive
at a cost of one point eight trillion dollars student loans. Now,
how is that fair, Giuseppe? Not for your college? Right?
I paid for three kids over fifty years to go
to college, two traditional colleges, one with the masters, and
(07:49):
one vocational college. And so now I have to pay
for people who chose to get degrees in things that
couldn't give them enough money when they're working to pay
back that student day. That's my problem, so my fault.
Speaker 3 (08:02):
Could you save that receipt and then write that off
on your jaxes.
Speaker 2 (08:05):
Let me tell you right now, and again we're going
to get into you know, interest rates and a specific
investment idea here in a moment. But let me tell
you who should be paying back students. It's these ridiculous
universities that are overcharging the students. They're supposed to be
(08:26):
not for profit, yet their profits are in the billions.
And now you see, because they're not for profit, endowment
funds which is just really a place to put their
profits that has surpassed a trillion dollars. So if you've
now charged a child, who I guess as an adult
when you go into college, you know, fifty thousand, one
(08:49):
hundred thousand, three hundred thousand for some degree that projects
them to make thirty forty fifty thousand dollars a year,
the university should be refunding them the money, not borrowing
the money to then have taxpayers be responsible for that.
That keyword being responsible that you know, make money that
(09:10):
paid for their college or didn't go to college and
own businesses so on and so forth. Strap it to
the universities re reform university proke because when I went
to college, which was in ninety one, No, I got
out in ninety one. God, that's been a long time already.
The cost of a semester was two hundred and ninety
(09:33):
seven dollars for state school tuition. It's now ten thousand
or more, not for books, in living or any of that,
or parking or food. No, ten thousand. Now, if you
take that inflation rate, it's tens of thousands of percent.
That wages did not go up by tens of thousands
(09:54):
of percent since then. And that is the problem with
the system, is that you universities have increased their cost
way beyond any measure of financial prudency that that you
could utilize. And so, first of all, I want to
(10:14):
once again say that we said that you know rates
were going to go down, and that the gift of
high interest rates is high interest rates, meaning if you
don't have a lot of debt, you know, you're retired,
your your your house is paid off, you have no
car payments, so on and so forth, your expenses or
at the lowest they've ever been, then high interest rates
(10:37):
are gift because you can get a high rate of
return fixed on your money. That window is closing. The
prices for stocks were high, and we started saying take
advantage and lock in some profits on your stocks and
buy bonds because the prices of bonds are low. Well,
the prices of bonds have been going higher because interest
(10:58):
rates are going down. It's still not too late though
to get some and we're going to give you a
specific one Deutsche Bank the July twenty thirty four expiration
six percent. This is an investment in grade individual bond
that Deutsche Bank is raising money by offering its bond
(11:22):
holders a six percent return. Now the yield to worst
has gone down to five point six point nine, and
that's because the price is now gone up, the price
to buy that. And this is just one example that's
still a great return Dusseppi. It's it's don't put all
(11:44):
your money in this one bond. But again don't wait,
don't wait to lock in profits that continue to go
down in the form of your share prices of your
your stocks that went up in twenty three and twenty
four are now coming down well.
Speaker 3 (12:00):
In in a balance. You know, in a typical retirement portfolio,
you're not going to have one hundred percent stocks. You're
not going after all this growth. You're going for a
balanced approach typically, and you want to have some interest
and dividends being produced out of that portfolio to help
supply you with a stream of income. And you know,
(12:21):
if you can get five percent six percent out of
a bond and have that for the next two, three,
four or five ten years, if you're lucky, yeah, how
as long as you want. Really, because interest rates have
been coming down. I mean I was telling John just
this past month or you know, six weeks. I have
(12:41):
a set of criteria that I search for bonds periodically
to see what's out there. Anytime, you know, we're adding
to client portfolios or swapping or maybe a new client
comes in and before you know, with the criteria to
have a minim of a five percent interest rate, been
them a five percent yield to worst and yield to worst.
(13:05):
All that means is if you figure out, hey, I
paid this much to get into the bond, I am
receiving this much in interest every year, and then when
it matures on its maturity date or it gets called
which means is just mature earlier than it's maturity date,
you get your principle back. And if you add all
those numbers up and say, hey, I've had this thing
for three years, would it actually earn an annualized basis?
(13:28):
That number represents the yield to worst so wellin the
parameters of my saved search list. Before when I hit search,
I would have twelve to fifteen pages worth of bonds
out there, so meaning I had a lot of choices
to put, you know, to kind of pick and choose
into and put them into portfolios. Now that same search
(13:51):
list is yielding three pages worth, so they're still out there,
but it's harder to come by. And if this continued on,
and especially with the rhetoric and the direction that the
Fed's going. The Bank of England just cut rates, European
Central Bank already cut rates, and the Fed and the
market is betting that the that the Fed is going
(14:12):
to cut rates in September. Yeah, yep.
Speaker 2 (14:14):
And we've seen the ten year treasury at a high
a five now below four. So interest rates have come down.
And quite frankly, this Deutsche Bank six percent bond, which
is investment grade, which means it's better than triple B minus.
And we believe that if you're retired, you should have
companies that are rated highly meaning investment grade versus junk grade.
(14:39):
Because you want to be conservative even in the bonds
that are in your portfolio, you also don't put you know, Okay, great,
I like a six percent coupon and a five point
seven percent yield. To worse, I'm going to put all
my money in that. No, if you don't know how
to you know, ladder your bonds into multiple different you know,
companies with multiple different maturities and yields, then then give
(15:04):
us a call at nine one six nine six seven
thirty five hundred. But this bond only has two years
of call protection, which is basically two years that you
know you're going to get that that six percent you
know interest rate. But after July twenty twenty six, Deutsche
Bank can refinance that away from you and give you
(15:26):
back your principle. Then the interest you've made is the
interest you've made anytime after July twenty six. So again,
if you don't really know you know, how to buy
individual bonds, please give us a call. More importantly, the
time is still better to own individual bonds because even
though the prices have gone slightly up, it's still better
(15:50):
than buying, say a bond fund where you don't know
you know, you have no principle guarantees, you have no
rate of return guarantee, so on and so far. So
give us call at nine one six nine six seven
thirty five hundred. The other thing I want to talk about,
Jo Seppee, is the rotation that we're seeing, and then
that will bring us to our second investment idea or
(16:15):
strategy for this show, and that is again we've seen
large growth companies hit all time highs, record high.
Speaker 3 (16:24):
It's been really the culprit and bringing the indices up
s and p five hundred and the NASDAC like we've
been talking about.
Speaker 2 (16:31):
And more importantly we've been saying and calling for, you know,
locking in some profit. A difference between a large growth
company and a large value company is typically that the
growth company doesn't share its profits if they have them,
and a large value company will tend to, you know,
(16:54):
financially fundamentally be at a price which is still a
good time to buy, but more importantly also pays a
dividend in the form of returning some of its profit
to its shareholders. So the first shift that we believe
you should be doing and that we have done and
(17:14):
focused on for our clients is focusing on the interest
rates they're receiving, i e. The Deutsche bond that we
were just discussing, or the dividends that they're receiving, because
the two components of total return are what income do
you receive from that investment while you're in it, and
(17:37):
then what does it potentially grow to above the price
that you paid. A lot of people have investments, whether
it's exchange traded funds, mutual funds, or individual stocks that
the only way you make money is it goes up
above a price higher than you paid, and then you
sell it for a profit. And if you don't sell
(17:57):
it for a profit, you've made no money because it
doesn't pay you anything while you own it. So our
second recommendation is to focus on large company divid in
paying stocks. And then one other recommendation is to look
for smaller companies okay that haven't you know, run up
(18:20):
as much as the large companies, but more importantly, look
for small companys that are undervalued. And again, if you're
doing this yourself or your advisor you know, just has
you in a basket of mutual funds and ETFs, then
a simple et f that you could do, and and
(18:42):
and the one that you know most people probably would do,
which is the rest of two thousand.
Speaker 3 (18:47):
Right, yeah, i WM, which you know, the the rotation
that you were talking about is people just pulling a
little bit off of the growth stocks and then putting
into small caps because when interest rates go high, that's
a that's a bigger burden for smaller companies, you know,
for them to try and borrow money, get business loans,
expand their business than it is for these bigger, large
(19:09):
growth companies. But i WM tracks are Russell two thousand
and so that's really the benchmark for the small cap
stocks that has run up, done very well, recently pulled
back this week, but it could be an opportunity to
get in if you if you thought you missed that boat,
now you know one thing to look out for. You know,
(19:33):
feds are going to be cutting rates. So one or
two things are gonna happen. Either they're cutting rates because
they are really successful in engineering a soft landing, or
they're starting to cut rates because the recession is brewing
and they're going to have to cut rates to stimulate
the economy. And if that is the case, then it
doesn't really matter of this rotation going on, then most
(19:53):
stocks are are going to be going down and pulling
back anyways. But for now you know one one that
but you know, outside of IWN and focusing more on
the value play. But you know, looking for a fund
instead of going through and just picking individual stocks.
Speaker 2 (20:09):
So this is a specific ETF that you could take
a look at as an idea.
Speaker 3 (20:13):
Right, is the Small Cap Value Factor Fund which is
SVL and they focus on small cap stocks but on
a value basis.
Speaker 2 (20:23):
Yeah, And so the difference between just doing IWM and
buying basically buying the whole wrestle two thousand is this
is more tactical. It's going to look for companies that
are actually making money that from a financial perspective, you
know fundamentally are a good price to get into those
particular companies, not just buying the whole basket of companies
(20:46):
that are, you know, by parameter small in nature, because
with that you'll get companies that aren't going to survive
a recession. So it's better in our opinion that again,
if your managing your own money or if you're working
with an advisor that just buys you Mutual funds and ETFs,
you know, to actually go more tactical and take a
(21:10):
look at SVA L instead. So if you're going it alone,
if you're in your sixties, seventies, eighties, and you're going
it alone and you're not taking advantage of the gifts
that we've been given, the opportunities that are presenting themselves,
please give us a call at nine one six ninety six,
seven thirty five hundred, get on our calendar for an
(21:33):
absolutely no obligation consultation, and on top of that, we
will do a written retirement plan analysis that we will
give you again with absolutely no obligation whatsoever, called nine
one six ninety six seven thirty five hundred. Why would
you want to do that? The best way? And again
here's some investment advice to tackle you know, uncertainty is
(21:59):
by having a play a plan that measures what success
means or what success is financially towards your goals and objectives.
Simply so, if you're living off of your retirement investments.
You know you've got social security, you have investments, and
(22:20):
you're relying on those for income, you should know what
percent return you need to get off of those investments
to give you the income that you need, and then
success obviously is after fees, after all costs, etc. Did
I achieve at least that percent return on those investments.
(22:42):
That should also be updated regularly, because if you haven't
done a plan, if you don't have those goals and
those objectives written down, then the the assumptions in that
plan are probably already out of date. Pecifically, what inflation
(23:02):
rate did you assume would be in those written plans,
What did you assume your expenses would be in the
future in those plans? So on and so forth. Those
things have changed so drastically in the last several years
(23:22):
that if it's been you know, prior to I would
say twenty twenty two, and certainly prior to twenty nineteen,
that you haven't you know, updated your financial plan, or
you don't have a financial plan at all, please call
us at nine one six ninety six seven thirty five hundred,
because we will show you that how how that will
(23:43):
help you be more successful in the future, and it
is included in what we do. It's included in our
advisory fee. As fiduciaries. We don't charge you separately for
written financial planning. We do that included in our fee,
and so a couple of things first and foremost, you know,
(24:04):
update your plan or come get a plan if you
don't have one. More importantly, start looking to shift the
type of stocks that you have from large growth to
large value or mid or small company size. Uh. That's
what we say when we're talking about you know cap,
you might hear people say large cap, small cap, mid cap.
(24:26):
That just means the size of the company. And we're
seeing that rotation from large to small. But there's a
lot of opportunity in mid as well. And many of
the utility and energy investments are middle sized companies that
pay great dividends. So look to rotate from large growth
(24:47):
to you know, small or mid value, especially companies that
pay dividends. Also, we gave you a specific you know,
a bond because we like individual bonds and the prices
a still good. So recommendation or sales idea, you know
number two investment idea. Number two was you know, by
(25:09):
the Deutsche Bank, you know, uh, investment in grade bond
paying six percent with a yield to worst of five
point seven five point six ninety seven. If you want
to be exact before those prices on ones like that,
go even higher. More importantly, don't let the the surprise
(25:31):
take your portfolio down. What I mean, there is a
surprise coming in every you know, election cycle.
Speaker 3 (25:39):
A good surprise, like birthday surprise.
Speaker 2 (25:42):
Well, in every election cycle, there's always this you know
event that happens. It usually scares the heck out of
the markets. It changes you know, rates in the bond market,
and and and people wait till after it happens to
rebound their portfolio. And what I'm saying is, if you
(26:03):
are already let July happen and you didn't rebalance your portfolio,
don't let the October surprise that typically happens, you know,
cause you to react and then rebalance your portfolio. You know,
these these tell tale signs, these things that are happening
aren't gonna It's not going to get smoother from here, JOSEPPI.
(26:24):
I think the ride only gets wilder from here.
Speaker 3 (26:27):
We've already entered it. I mean, the back half of
July and go into the first week of October is
volatility season. So we are in the midst of it,
and you know, we have the rest of August and
potentially the beginning of October that volatility. Can you know,
continue to be elevated. So and you know there there's opportunity.
(26:48):
Like the small cap it's gone up ten percent, and
so maybe people are like, oh, no, I missed that boat.
I should have got into it. Well, it's recently pulled back.
Speaker 2 (26:58):
Yeah, last week it came like that val that we
were saying, it's down four percent of one day. Know,
it hit a high of around thirty six dollars per
share and then it was down to about thirty two dollar.
Not we're not giving you this exact price because as
long as the market's open, the price is fluctuating until
you buy it and then that's your exact price. But
(27:20):
now it has pulled back, and if there is a
rate cut, you know, it's a good time. If you
already have it, it's a good time two dollar cost average.
If you don't have it, it's a good enter entry point.
Speaker 3 (27:31):
And how much do you put this in your portfolio?
How much in the bonds are you put in your
portfolio at? How many different bonds do you buy? You know,
how big of a position. These are all questions and
things that we go through with our clients, and we
don't know who you are, your your means, your your
risk tolerance, your time horise and so and so forth.
So that's the due diligence you have to do on
(27:51):
your own and that's what we do with our clients
through financial planning and then construct and build out the
portfolio according to your goals, timeline, risk tolerance and what
you need. And if you're confused or you're thinking this
is too much, that's a great reason to give us
a call and we can help walk walk through that journey.
Speaker 2 (28:13):
With what is that number, Jiuseppe, I'm just curious if
you know it's nine Jenny, Jenny, Yeah, nine six seven
thirty five yep, nine six seven thirty five hundred. Again,
that number is nine one six ninety six, seven thirty
five hundred. Leave us a message and Kathy will call
you back during the week. You know, some of the
(28:36):
the energy companies, you know, I can't help, but always
revert back to the energy sector. I always think and
can prove it quite frankly, it's always one of the
top performing sectors because everything begins and ends with energy, right.
If there's no fossil fuels, if there's no natural gas,
if there's no nuclear you know, if there's no refining
(28:58):
of that getting it out of the around, shipping it
from you know, one place to the other, getting it
to the person who sells it to consumer, you know,
so on and so forth. There is no business in
the world.
Speaker 3 (29:09):
Yeah, and if there's if there's no coffee, I have
no energy.
Speaker 2 (29:14):
So the reality is, you know, we're starting to see
a little bit of a pullback, you know, off of
highs in the different energy and utility companies. And so
here's another time to where you could shift to from
a focused perspective. Okay, we've said go from large growth
to you know, companies that are maybe still large but
(29:36):
are undervalued, that pay a dividend, or they're smaller in
size and undervalued, probably don't pay a dividend. But here's
an opportunity to get into some of the energy investments
that do pay a dividend and consistently pay that divid
in year end, year out, because no matter what is
going on, you know, it always requires you know, more
(30:00):
energy each year, not less. You go, oh, well, ev
cars are gonna you know, take a bite out of
fossil fuels and nuclear. Wrong. No, In fact, the more
we go to electric vehicles and electric transportation, the more
fossil fuels will need the more nuclear will need the
(30:22):
more unfortunately, coal will need the more natural gas we
need because that is where the power comes from that
people get at their home, at their business, wherever they're
plugging those ev cars in. That's not being made by
the sun. Yeah, in my case it is because I've
(30:42):
got solar panels and then i plug my car in
at home, and our solar panels cover our total bill.
So technically I'm charging my electric vehicle off the sun.
But most people are not. Most electric, you know, one
of my electric equipment of any kind, whether it's a
(31:02):
car or a blow dryer or a microwave, is not
by wind, meals or solar. There again, by natural gas,
by fossil fuels, by coal, by nuclear. And so there
are great investments, and I'm going to give you one
right now that I really like, which is fr again.
(31:28):
That's Frontline PLC FRO, and it's it's in the transportation
side of energy, and it pays an awesome dividend. And
what was the price roughly last week, Jiuseppe, It was
in the it's been anywhere. Well, actually when I started
(31:48):
talking about it, it was, you know, thirteen fourteen fifteen
dollars per share that I'd say, hey, take a look
at this. I think it's going to be a double.
Then it went to about twenty nine dollars per share,
and now I think it's down in the round twenty
three or twenty.
Speaker 3 (32:01):
Four, twenty three, twenty yeah, twenty three, twenty fours kind
of the range. It's actually it actually touched like twenty six.
Speaker 2 (32:07):
And here's the best part. What is the dividend if
you pay projected on twenty three dollars and whatever? Again,
it depends on when you get in, you know, it
depends on the exact price you pay.
Speaker 3 (32:21):
Well, And the other part is how long has it
been paying dividends?
Speaker 2 (32:23):
Oh?
Speaker 3 (32:24):
Well, and that's the thing.
Speaker 2 (32:25):
This company has consistently paying its dividends basically since it
became a publicly traded company, and it has been paying
at a double digit rate for a very long time.
At the twenty three, no, twenty four dollars, let's say
it's around a ten percent annualized projected dividend. Dividends are
(32:47):
not guaranteed.
Speaker 3 (32:48):
Ten point one to be exact.
Speaker 2 (32:50):
But here's an example of a sector, you know of stocks,
the energy sector, you know, of an investment that can
afford to pay out its profits in the form of
a dividend two shareholders that also acts as a hedge
at at ten percent, because the market would need to
(33:11):
go down ten percent. This price would need to go
down ten percent before your principle has eroded after a
year's worth of dividends. So I hope you've enjoyed the
show so far. And the three investment ideas that we've
talked about so far is the Deutsche Bank six percent
twenty thirty four bond, the ETF sva L, which is
(33:37):
a small company of value ETF, and Frontline Plc FROO,
which is an energy transportation stock with a projected ten
percent dividend. Now, if everything we've been talking about solms,
whether it's the planning and updating your plan, or rotating
(33:58):
from large company owth to large company value or mid
value or small value, or moving a portion of your
money from stocks to bonds, you know, having an actively managed,
you know diversified truly diversified, which means low correlation portfolio
is crucial to you know the future and whether or
(34:22):
not you run out of money. If all of this
sounds overwhelming to you, it is if you're not doing
this full time, if you're not at your screen every
minute that the market is open, if you're not a
student of this industry, if you're not you know, listening
and researching all of the different you know, investments and
(34:46):
ideas and so on and so forth, and filtering it
all down on a daily, weekly, annual basis, you should
not be going it alone. Give us a call at
nine one, six ninety six, seven thirty five hundred. Just
because twenty three was good and twenty four is so
far good doesn't mean in one blink the market could
(35:09):
be down and your investments could be down twenty thirty
forty fifty percent in a blink of an eye. There
is nothing, you know, supporting why the markets or investments
should be higher, but there's everything supporting why they should
be lower from an economic, from a macro economic, or
a geopolitical perspective.
Speaker 3 (35:32):
And part of that test is earnings. If companies continue
to push healthy profits and forward guidance that's positive, then
that can you know, be the catalyst for the market
to continue to run up. But we've seen some of
that volatility, yeah, some mixed, and we've seen some of
the volatility be spurred, you know, specifically from Google and
(35:55):
all the AI spending that they've done, and the revenues
from all the spending that they've done has has not
come in to the same degree. So there's been some pullback,
some volatility in the market because of that and the
magnificency seven have seen it. I mean there's been a
down day and upday and then you know, oh all
over the place.
Speaker 2 (36:14):
I mean again, the Nvidia is. You know it it
reached a high, a pre split high of basically fourteen
hundred dollars per share or a post split high of
one hundred and forty dollars a share. And you know,
when I looked at it last week, it had been
as low as like one oh three to as high
(36:36):
as like one seventeen. But if you go from one
forty down to one oh three, I mean you're talking
about more than a twenty percent pullback off of its highs.
And if you were sitting in that stock and you went, oh, no,
I'm not selling it even though it's way overvalued and
doesn't support you know, a price of one forty, it's
(36:57):
going higher. I just know it is. I love this talk.
You're now going, God, I I'm panicking and wish I
would have sold the stock. And so again we talk
about these things to hopefully get you to not procrastinate
and just give us a call to come in and
have a conversation with us. We love what we do
(37:19):
and we love helping our clients. And even if you
come in and we just have a conversation that helps you,
we're super happy with that. If we decide that we're
a good fit and it makes sense for you to
hire us, we're happy with that as well. Either way,
don't wait for things to get even crazier. Call us
(37:40):
at nine one six nine six seven thirty five hundred.
As we talked about in the in the previous parts
of the show, there's there's more volatility to come. In fact,
one of the most volatile months, which means where the
market is going to cause pa is the month of October.
(38:03):
You throw that in with a potential election surprise or
any surprise you know on the national or world stage.
Already had a couples, right, We've already had a couple
in a foreign That's what I mean. And gosh, I
hate to see people where you know they had huge
profits and now all of a sudden, they don't have
(38:24):
those huge profits anymore because what they were worried about paying.
Our average fee is one percent. Now some people pay more,
some people pay less. It just depends on the size
of your relationship with us. But really you're going to
go it alone because you don't want to potentially pay
one percent. One percent is typically one seventh of what
(38:50):
an annuity person gets paid up front when you buy
an annuity. It makes no sense to buy an annuity
and lock your money up for six to ten years
at a seven percent upfront commission, when that is seven
years of our average fee of us being hired by you,
working for you, trying to help you accomplish whatever your
(39:14):
goals and objectives are on a proactive, like I said,
not a reactive basis. For guys that have almost a
combined fifty years of experience called nine one six ninety
six seven thirty five hundred, this is when it matters
and are you paying a low price that has value
(39:34):
and upside in it, or are you still paying too
high a price. That's the research that you need to
be doing. And the one that I gave that the
Frontline was just one example of where there's upside value.
But even if there wasn't, even if it just hovered
around twenty three or twenty four dollars per share, that
ten percent dividend is a phenomenal return on investment. Well
(39:58):
was twenty nine just back in and nothing fundamentally has
changed for that company. Their earnings didn't go down, they're
not making less money. The need for what service they
provide hasn't changed. It gets bigger every year. It's just
down in lockstep with the uncertainty of the overall macro
(40:19):
economic environment that we're in. And so that is when
you gobble up more of companies like that. That's when
we gobble up more of companies like that for our clients. Now,
is there an AI stock that you could get in
right here? Is there one that is showing signs of
(40:41):
being undervalued and oversold? And I think there is Giuseppe
and Giuseppes even looking at me. But the indicator, the
PEG indicator, is showing that this company is over sold
and undervalued. And this is a huge tip people. Now again,
(41:02):
I don't know if it's appropriate for your portfolio. We
don't know who's listening. But if you're wanting to get
an into the AI potential sector of stocks, then you
should take a look. Now, do your own research. Again,
this is a very volatile, still expensive stock, but based
(41:23):
on its financials, based on its PEG ratio, based on
its PE ratio compared to Nvidia's PE ratio, what about
and R two D two, this is looking like a
good time to buy this particular investment. And it is
super micro computer. This thing in the last you know,
(41:47):
few months, has been you know, from from six hundred
roughly to you know, over a thousand, and here we
are back down into the sixes. I bought some more
of it for for personal accounts when it was around
you know, six point fifty nine, and I think it
hit a low of below six point fifty last week.
(42:11):
Again not looking at it right now, but it was
at a fifty two week high literally over a thousand.
Speaker 3 (42:19):
But again, if you lose.
Speaker 2 (42:20):
Over twelve hundred at one point at twelve hundred and so,
well that's definitely over a thousand.
Speaker 3 (42:27):
Well it's basically, I mean it's range. It's fifty percent, yeah,
you know it. It touched over twelve hundred and it's
in the six hundred so.
Speaker 2 (42:36):
And compared to other AI chip stocks. It has a
low pe, it has a low peg. It's a good
time to dip your toe in it. Well, I hope
you liked all of our investment ideas on this show.
You've been listening to John Scambray and to Seppi Veskani,
the Wise Money guys. Have a great weekend.
Speaker 3 (42:59):
Talk to you next week.
Speaker 2 (43:00):
The first Story report Tim, then Stan
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