November 21, 2025 • 42 mins
There are new trends we're watching in the AI development industry. It could affect your confidence and strategy when investing in high-tech stocks. Hosts John and Guiseppe share their concerns. Plus, new September jobs numbers, locking in market profits now, and more about our no obligation consulations. The Wise Money Guys.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
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.
Speaker 2 (00:14):
Welcome to the Wise Money Guys Radio Show. I'm your
co host John Scambram here with my partner Wisconsin. And
if you don't know it already, we're certified portfolio managers
that specialize in helping people who are retired are about
to retire, manage their money, create their plans, and just
help them live out their their financial dreams, specifically pre
(00:36):
retirement and during retirement. So as always, if you like
our show, give us a call at nine one six
nine six seven thirty five hundred. But before we really
dive in, I want to start off by saying we
have breaking news that we're not one hundred percent sure.
We're going to save that for a little bit later,
(00:58):
that you're absolutely need to know and hear, because it's
if it's even half true, you know that the darlings
of the stock market this year are in for a
real ride. And if we think about it, this week,
it's been a pretty good roller coaster ride already. I mean,
(01:19):
I get it relative to nothing, you know, the year
to date, not not that big of a deal, but
but or relative to may as you say. But still,
this news is so juicy, and I can give you
a hint. It's about one of the Mag seven stocks
that everybody loves. And again it's breaking news. We've already
(01:41):
seen movement. If you or anybody has this position, you're
going to want to give us a call, come in
and see us because we can show you, especially if
you have a lot of shares in the Mag seven,
on how to strangle and straddle and hedge and protect
that position and potentially lock in its value and still
(02:03):
generate great returns from it.
Speaker 3 (02:07):
But past performance doesn't predict future yes results And you
can look at more informator get more information from our
website wisemoneyguys dot com and we have a lot of
cool information tools, calculators you can scroll all the way
to the bottom reader lovely and exciting disclosures, but also
our bios more about you know, John's background, my background
(02:30):
we talk a little bit about on the shows as
well as a firm. You can also ask us a question.
So if there's a topic or area that maybe we
haven't talked about or is an interest of you.
Speaker 4 (02:40):
You can email us at question at wise money.
Speaker 2 (02:42):
Guys, you five definitely email us. We never disclose personal
information and we don't sell people's information. By the way,
if you don't know, Charles, Schwab is really our favorite
platform that we do manage our clients money through Custodian.
It's it's it's a i'd say, and compare contrast it
(03:07):
to Fidelity and nothing against Fidelity. We also have clients
in Fidelity, but I like the Schwab platform better support.
Speaker 3 (03:15):
The support that we get from Schwab is ten times
better when we need an answer, typically get an answer
in five minutes or less, where it's ten times faster
than what we've experienced in Fidelity. Surprisingly enough, because we thought,
you know, Fidelity Swab, well, they're the two big behemoths and.
Speaker 2 (03:36):
Even better than Schwab.
Speaker 3 (03:37):
Yeah, you would expect, I mean I would, I would
expect at least the saying because they're the two big,
big behemoths, you know, and the brokerage at least the
retail brokerage side of things, and we represent them on
the institutional side, so we don't. We don't Custody our
own clients money, our client's money.
Speaker 4 (03:55):
It's a very important Schwab.
Speaker 3 (03:56):
Interactive brokers, Fidelity paychecks and we use all these big
names and the money is there. We just manage on
their behalf put together the financial plan.
Speaker 4 (04:07):
Albeit but yeah.
Speaker 3 (04:08):
We're very surprised on the differences between the help and
support that we get when needed from Fidelity versus Schwab.
Speaker 4 (04:16):
Hopefully it improves, but but we'll see.
Speaker 2 (04:19):
So what that really means is if you already have
a Schwaber Fidelity account, giving us a try and hiring
us to see why. We consider ourselves probably the best
UH in the in the region, in the West best
and I like that it Ryan is the best in
the West. Is pretty simple to do. So with that,
(04:41):
let's let's dive in a little bit. Let's let's not Yeah,
we have the idiot, we have Nvidia earnings. We got
to talk about. We have some economic data that's coming out.
We had non non farm payrolls job numbers essentially, which
were on pause because of the government shutdown.
Speaker 3 (04:59):
Right, so we'll talk a little bit about that unemployment
figures and then dive into the breaking news of just
from some of the information that we've read and not
have not dug far enough to see if it's legitimate,
you know, truly legitimate or not.
Speaker 4 (05:18):
But it has a pretty good ring to it.
Speaker 2 (05:20):
Well, here's what it does. It really makes you be cautious.
And so what I like about this that we're going
to share is it's just a demonstration of we just
don't blindly, you know, put money into specific positions, shout
out following the news, looking at technicals, looking at financials,
(05:41):
trying to get our hands on various things to make
a decision if it's time to get out of something
and get into something else, or if it's time to
add something. Don't forget that. For the last what two
months or so on this show, we've been telling people
be cautious here, don't don't don't go bet in the
(06:04):
farm on the tech sector, be choosy and gosh, lock
in profits and regret that you locked in some profit
and you might have made a little bit more money
on paper versus you didn't lock in profits. And now
you've watched some of those profits go up and smoke
because you mentioned in Nvidia earnings and you look at Nvidio,
(06:27):
you know, broke above two hundred and now it went
down into the one seventies. I I didn't look how
it closed on Friday, but but I mean, that's a
ten percent swinging right there. And if you didn't lock
in some profit, you know, you potentially gave up you know,
ten percent, and so any well, and.
Speaker 3 (06:49):
I don't think that's a reflection a direct reflection of
the earnings because they crushed earnings once again.
Speaker 2 (06:55):
Crushed as an understatement.
Speaker 3 (06:57):
Yeah yeah, so and after hours when they reported, the
stock was up after hours five percent. But then the
following day they everything was up, you know, on Thursday,
and then things just started breaking apart and then went down,
and we had some Fed speakers. Job numbers came out,
(07:17):
So that poured a little bit of cold water on
the betting markets as far as are the Fed's going
to cut rates or not.
Speaker 4 (07:25):
It was like ninety percent and it's fifty percent. Now
it's in the forty percent.
Speaker 3 (07:28):
I think, maybe even lower if the Feds are going
to cut another quarter point in December when they meet.
Speaker 4 (07:34):
So that put a little cold water on the market.
Speaker 3 (07:36):
And then valuations, which surprisingly, you know, it's maybe the
past three or four weeks, I've been seeing headlines and
it's just so funny because I'll see the headlines obviously
every morning, and it'll say stock markets up, and then
I'll give some sort of description of why the market's
up or why the market's down. Right, But now you've
been seeing these past at least a few weeks of
(07:57):
why we've had some volatility, and especially the tech sector
of valuations, valuations, valuations. Well, there was no headlines of
valuations when Nvidia was two hundred dollars a share, exactly.
But there are one hundred and eighties a share, seventies.
Speaker 2 (08:14):
Concerned about the valuation.
Speaker 4 (08:16):
Yeah, after they after they crushed earnings.
Speaker 2 (08:18):
Well, you know what, you know what else is interesting
and it's kind of shocking. Actually we talked about this
during the week. Is that Microsoft and Nvidia, if you
take either one of the market value stocks, that the cap,
the market value is bigger than all other markets stock
markets in all the other countries except for China, and
(08:44):
and and that is just unbelieved Japan, except for Japan,
thank you. And Apple by itself is as big or
bigger than the entire Chinese market cap of their market,
of their stock market. So well, yeah, and those three
companies are here, so it's crazy tells you if you're
not investing just or think or if you don't think
(09:06):
that the US is still the land of the greatest
opportunity to live and prosper just from a financial perspective. Boy,
it's not somewhere else, that's for darn sure.
Speaker 3 (09:19):
Well there are other companies, you know, emerging markets and
internationals actually had a prediscint year so far this year.
Speaker 4 (09:25):
But everything is so connected these days.
Speaker 3 (09:27):
I mean, like Apple, right, if China has bad news
on manufacturing with animal so obviously, but it's crazy.
Speaker 2 (09:35):
So much manufacturing, it's crazy.
Speaker 3 (09:37):
But but to your point, when the US has something
material going on, whether it's the Federal Reserve or Nvidio
earnings or whatever, and we have a down day, Asian
markets will open up, you know later on the same
same day and at night, you know, in the US
(09:57):
and they have a down day, and the the description
the headline is not what's specifically in the Asian markets,
but it's because what happened in the US markets or
US companies.
Speaker 2 (10:07):
All right, So on our next segment, we are going
to break the news that we've been talking about. We're
prefacing it with gain news. There's there's no there's no Uh. Well,
I guess for a while there was things that would say, oh,
fake news, and they turned out to be fake. But
but even if this uh segment is something true, something
(10:29):
something to heed caution on, you absolutely have to stay tuned,
just real quickly before we dive in. Tell us about
the job numbers, because again, those are crucial when it
comes to the Fed's decision on whether it's a lower
interest rates, because we're actually seeing the longside of the
yield curve in treasuries creeping up. So people always think that, oh,
(10:53):
the Fed cut rates, that's it, you cut FED funds
and automatically interest rates go down. Now, we have seen
improvement in mortgage lending rates, and the shorter side of
the curve, which is a normal yield curve, has has
gone down a little bit. But it's concerning that the
long side of the curve is actually going up, which
(11:15):
means people are selling out of longer dated treasuries and so.
Speaker 3 (11:23):
And yeah, and all that means to the regular retail
you know, citizen out there is Fed cuts rates. The
tenure treasury is kind of barometer that initially dip down.
You saw, yeah, you saw mortgage you know, thirty year
mortgage rates start to decrease, got in car loans start
(11:44):
to decrease, but then they started creeping back up again.
And so that's why if these you know, ten year
yield treasury starts creeping back up again, doesn't matter if
the Feds are lowering rates. They did this in twenty
twenty four where they cut rates three times, and just
before the cut rates, we saw mortgage interest rates right
(12:05):
start to dip, but then after the cuts they actually
spiked back up and then went back to like seven percent,
So it didn't really help anybody out. And so that's
where that can be very important to watch that number
and where the tenure treasury is because it doesn't matter
or fed's cut rates. Initially people think, oh I can
go get that loan for that car, or maybe I
can go forward that house now because it's you know,
(12:26):
quarter percent lower.
Speaker 4 (12:27):
No, it doesn't actually translate directly.
Speaker 3 (12:29):
Like that, but what it does directly translate to is
the CDs, the money market rates, the savings rates. Those
will will come down immediately when Feds start cutting rates,
and that's where you have to pay attention to as well,
because then how are you investing your money you know,
if you're earning four or five percent on some promo
(12:49):
money market or.
Speaker 4 (12:50):
CD rate, that's great, but especially CDs.
Speaker 3 (12:53):
And we had a meeting with a potential client and
they had fourteen three fourteen month CDs that were locked
in at four and a quarter, which four and a
quarter is pretty good right now. The problem is is
when they when they mature, when that fourteen months is up,
what a rates are you know what a rate's going
to be.
Speaker 2 (13:13):
At that point? Sure and right now.
Speaker 3 (13:16):
And the discussion that we had with them was, you know,
well you can get into you know, JP Morgan or
wals Fargo, these are the banks that are offering these
CDs or money markets right promo higher rates. You can
get into their bonds right now they're paying five or
north of five. But it's not going to be that,
you know, fourteen months if everything starts to go down.
But to the job numbers, data came out in September
(13:40):
non farm payrolls, so basically employment increased by one hundred
and nineteen thousand, much higher than what was anticipated.
Speaker 4 (13:50):
It's good news, but the good.
Speaker 2 (13:53):
News in an upside down world, right it's inverse good news.
And I used to talk about this a lot a
lot lately that or recently, that bad news was good
news when it came to decisions that we wanted to
fed the Central Bank to make and that's kind of
where we're at.
Speaker 3 (14:12):
Well, No, that was partly you know, after April and May,
when the market you know, corrected over twenty percent, market
started rebounding because aiuphoi was starting to come back. But
then more so it was a FED, a federal reserve
was in focus, and the rate cuts and then taking
a stand to just leave rates, you know, stand pat
(14:33):
to now having a discussion of like yep, I think
we can start cutting rates right now, and so that's
a stimulus to the overall market. But if you have
good news that the economy is resilient and it's still
doing good and it's strong, then that means that it's
not giving much ammal for the Feds to continue to
cut rates. Therefore, there's no more of that stimulus that
(14:56):
is going to be fed into the stock market, and
we're seeing a little bit of that and why the
volatility is kicked in recently into the stock market. So
I take it as good news because it just means
that we're still being resilient.
Speaker 4 (15:10):
On the other side, which you're going to get excited
about here, John.
Speaker 3 (15:14):
Is unemployment rate rose from four point three to four
point four percent. You're going to ask, well, why if
we had stronger numbers in September than what was expected,
how did unemployment go up?
Speaker 4 (15:25):
Well, partly do.
Speaker 3 (15:26):
You because of BLS revised the numbers in August from
positive twenty two thousand jobs to negative and four thousand jobs.
Speaker 2 (15:36):
You can't trust government data. I mean this, this game
of basing things on bad data, which mostly is political
narrative data, is just it's ridiculous. That's why you need
people like Giuseppi and I to actually dive into the
(15:57):
investment the portfolio, you know, be at the helm of
potentially making changes by knowing the underbelly of these things.
And you just can't blindly, you know, trust, you know,
I guess the saying has always been trust, but verify. Boy.
(16:18):
I think it's it's hard to trust and and and
and double verify because the numbers just aren't, you know,
ever correct. And they base these numbers, you know, on
on decisions, or they take these numbers and base their
decisions on them, and it just drives me so it's hard.
Speaker 3 (16:34):
To if you get to revise it and revise it,
especially the revisions revisions have has been more biased to
the downside versus the upside, So it is hard to trust.
And you know, it's funny. I just watched a movie
last night. I was just up and I was on
YouTube TV and a movie popped up. I'm gonna see
if you know this movie, if you got to know
this movie for your time background, But it talked about
(16:58):
part of that movie is all about trust, right, and
it was. It was it was a world where this
this kid was living in between and trying to live
by his father, who is a hard working blue collar
worker in the Bronx. But then he lived next to
a bar. Right, they had the mafia and the head
boss or the captain Coppo of the of that region
(17:21):
took a very a big lacking to this kid.
Speaker 4 (17:25):
No, the kids, the kids.
Speaker 2 (17:26):
Not the kid, but the father.
Speaker 4 (17:28):
No, No, it was Chaz Pilementary.
Speaker 3 (17:30):
And uh, the kid's name was Colojuro so that should
give a hint.
Speaker 2 (17:35):
But it was all about my mind was Bronx tail
right exactly?
Speaker 3 (17:39):
Yeah, But it was all about you can't you can't
trust nobody.
Speaker 2 (17:44):
And you can't trust sadly, you can't trust trust the data.
I mean that he's out of these by the way,
that's Bureau of Labor Statistics. You can't trust their data,
you can't, you know they and and politicians always tout, oh,
according to the CBO or the BLS, or or or
the federal or the FRB Federal Reserve Board, you know,
(18:07):
on and on and on. What you can only trust
is what you see in your results. And that is
where we are your warriors to make sure that we
know and have created the plan that you need, and
we know and have created the investments that you have,
and we know when and again we're basing it on
(18:28):
what we can dig into. So that's kind of a
good save way to dig into this this breaking story
which is on the Darling in VideA, and I mean
I got chills when I read. Now you all, uh
and who's ever listening may be familiar with just recently
(18:50):
we had a ponzi scheme, you know, with it with
the crypto exchanges, right and you had I forget his
name that's now in prison because they were, you know,
taking some people's money and that was coming yes FTX,
thank you taking it in and saying that money coming
in was was return on investment, that your investment, and
(19:13):
then they were paying out people, you know, on that
new money that was coming in and so, which is
what a ponzi scheme really is until the money stops
coming in. And then now people who want to get
their money out have no money to get out because
they find out that the returns and the performance just
(19:35):
really weren't there. So it's the classic definition of robbing
Peter to pay Paul. And so listen, the mag seven
has had a tremendous year, unbelievable your turns and everything
has been about AI AI this, AI that, and we've
spent a lot of time trying to find indirect ways
(19:57):
like energy investments, you know, software and data center, data
centers or the people who literally physically contruct construct those
things on ways to play I play AI that just
weren't you know, the chip or the software or the
machines or the quantum computing and things you know like that,
(20:17):
because you know things were getting lofty, And go ahead
and share what what you sent to me. That literally
gave me chills because as we said, this this breaking story,
even if it's half right. Even if it's quarter right.
The pressure it could put be put on the valuations
(20:38):
of everything having to do with AI and the increase
in profits that that has been told to us. But
then if any of that becomes untrue, we will see
a massive crash in the tech sector. So if you
don't have somebody who's in your corner watching these things,
making sure you're properly diversified, making sure that all your
(21:01):
investments aren't tied to one sector and one category investments,
i e. You know, stocks in the tech sector, boy,
you could be in for a world of hurt. You're
gonna want to call nine one six nine six seven
thirty five hundred, but share it just that because like
I said, I mean, we.
Speaker 3 (21:18):
Don't have much much time left in this segment, but
so we'll get to it in the next But the glimpses.
We've already talked a little bit about open ai because
there's been a lot of investments between open ai and
other companies, Oracle being one of them, and three hundred billion,
and we were kind of questioning, well, if they're if
they're investing three hundred billion over five years in Oracle,
how much are they actually making in revenue now right,
(21:40):
and they were like negative and I think they were
slightly positive.
Speaker 4 (21:43):
Well, how they're going to get three hundred billion dollars
to the oracle? Right?
Speaker 2 (21:47):
Yeah, how do you get three hundred billion dollars in
Oracle purchases? Nobody's gonna lend you, you know, two hundred
and eighty you know, billion dollars. We're going to tell
you more about that. You absolutely have to stay tuned.
And the store we've been alluding to, we didn't break
the news, but we're certainly diving into it and trying
to corroborate it with more research and evidence that we
(22:09):
can find. But it's investigative journalists, well, you know, I
mean you have to be you know, that's that's actually
a really good point. I mean, when you're when you're
somebody's money manager, plan er, you know, financial consultant, and
you help them with something so significant as their their
wealth and legacy and retirement income, so on and so forth,
(22:30):
you have to be investigative journalists.
Speaker 4 (22:34):
Right.
Speaker 2 (22:35):
But that's what always drives me crazy that so many people,
you know, are worried about paying a small fee, and
our fee on average is one percent per year, and
and and generally it gets paid.
Speaker 4 (22:48):
Actually it's actually our average general it's actually less. The
overall whole.
Speaker 3 (22:53):
Book of assets that we manage is actually point ninety
three because it can range below one percent. It could
be above one percent on the assets and household that
we manage.
Speaker 2 (23:02):
And so many times when we take over somebody's portfolio
again we're getting sidetracked, and we find that they have
mutual funds and closed end funds and ETFs and all
these things, and then we show them what the embedded
management and fees expenses are inside of those. Often they're
they're as much as our fee. And so when we
build them a different portfolio with positions like individual bonds
(23:25):
and individual stocks and alternative investments and so on and
so forth that don't have those things in them, we
sometimes we pay for our fee just right there. So
and that's analysis we do when you sit down for
a new obligation consultation and we review your portfolio and
your situation and we show you, you know, how we
do things and how it might be better for you,
(23:47):
and and just have a great.
Speaker 3 (23:49):
Basically how to get you from how to get you
from point A to point B, which is still some
part of the planning phase as well.
Speaker 2 (23:54):
But we've been dodging it, okay, So here it is.
You know, I mentioned just briefly that there was a
couple of Ponzi schemes. The last one was the crypto
uh crypto exchange Ponzi scheme. Obviously everybody knows the Bernie
made off one uh before that. But here we are
that there might be a Ponzi scheme. This is the
(24:14):
This is the news that there might be a Ponzi
scheme in the AI, you know space, involving companies like
open Ai and Nvidia, Microsoft, Microsoft, so on and so forth.
So if you have those in your portfolio, you absolutely
need to come and see us, and we'll show you
(24:37):
how potentially building you out a portfolio for you know,
now and in the future is just crucial. And you
can't just rely on such a small segment of the
investing world, you know, to be your lifelong sectually pretty
large though well ye well meaning small and numb. Three companies,
(25:01):
five companies, seven companies. Yeah, you know, but it's crazy
how income investments or divid in pain investments because none
of those stocks pay any dividend or EPLE does. Oh yeah,
what what so which almost pays for our fee. But
but here it is, you know, yeah, so what we
you know, we say Ponzi scheme, but it's not a
(25:21):
Bernie Madoff scheme. You know, it's but uh, there was
an article. There was actually something on x that was interesting.
I read through it.
Speaker 3 (25:33):
It was sent to me by a buddy of mine
who's also an advisor. I sent it to John and
you know, we'll have to look more into it to
see the validity of it.
Speaker 2 (25:43):
But in Vidia accounts received sense it's crazy.
Speaker 3 (25:47):
Yeah, in videos accounts receivable, right, so all the money
that should be coming in exploded thirty three point four
billion dollars. But here's the important part of it is
customers are taking a longer period of time to pay up.
Speaker 4 (26:03):
It was forty six days now it's fifty three days.
Speaker 3 (26:07):
Which represents to pay up, you know what they basically
committed to Nvidia, whether it's chips or what have you.
So there's ten point four billion at risk that could
never be collected who knows, which.
Speaker 2 (26:20):
Would drastically alter their results.
Speaker 3 (26:23):
Yeah, and Nvidia is sitting on almost twenty billion dollars
of unsold chips, so it's contradicting to the insatiable demand
that they put out there on their earnings calls and
how much demand they have when they have this kind
of law. Yeah, it's backlog, well not a backlog, but
this but the stock you know, stockpile. And it could
(26:43):
be because they've been spoken for, but and it's been
accounted for in their in their in their Excel spreadsheets,
you know, the paid counters, but not paid for, so
therefore it cannot be released. Right, So just kind of stockpiling.
And Vidia reported nineteen point three billion in profit, but
only fit fourteen and a half that was in real cash,
(27:05):
which is a conversion of seventy five percent. The piers
when you look in at amongst peers, the peers are
at ninety five percent. So there's some concerning things that
are going on in the accounting, yeah, and the accounting portion.
The other the big thing, which is like the potential
Ponzi scheme, yes, is the loop of companies that are
(27:26):
funding each other, right, Microsoft, open Ai, Oracle and Video.
Speaker 2 (27:30):
It's a circle revenue.
Speaker 3 (27:32):
Yeah, they're calling it vibe revenue where dollars circulate between
each other, Like, oh, open Ai is going to commit
to three hundred billion dollars of investment with Oracle. Oracle
is going to, you know, commit X amount of billions
of dollars to buy x amount of chips over the
x amount of years. You know, with Nvidia, Microsoft is
(27:55):
going to you know, commit to Oracle. Oracle is going
to commit to Microsoft over x amount of years an
x amount of purchases of product or service or whatever.
But no, there's no true and to customer demand, and
so is does this and so like the point that
we brought up was like open Ai, you know, open
(28:17):
Ai themselves and let me see if I have data
because I did read they had Yeah, open Ai.
Speaker 4 (28:23):
Here you go.
Speaker 3 (28:25):
So open Ai loses five point six billion dollars annually.
Speaker 4 (28:30):
They lose.
Speaker 3 (28:30):
Yeah, they're generating no revenue while making enormous for purchase commitment,
the commitment. So, and that was what we had talked about,
I think maybe a few radio shows before. When when
they announced a three hundred billion I'm pretty sure it
was a three hundred billion billion investment commitment to Oracle.
And then Oracle literally jumped up their stock price to
like twenty six percent. Now it's come down since then,
(28:54):
but it literally spiked their stock price way up but
now you're saying, okay, open Aiye, Oracle, Microsoft in video,
and they're all kind of committing to each other. And
this is like kind of the side argument, you know,
and some of the people on the other side of
the table saying like, oh, we have all this investment,
you know that Trump is has has committed countries or companies,
(29:18):
you know, trillions of dollars.
Speaker 4 (29:19):
But has it actually come to fruition.
Speaker 3 (29:22):
Right, The same argument is going on right now with
all of this investing future investing. Not hey, we gave
you three hundred billion dollars, give us your product, or
give us your product when it's available. It's all this
we're committing to the Yeah, it's kind of like, yeah,
it's kind of like an loi, right, we we intend
to invest x amount over the next many years. And
(29:45):
because of that news that's circulating around, it's pumping the.
Speaker 2 (29:49):
Stock prices up exactly, which.
Speaker 3 (29:51):
Then starts to become a valuation problem, which now you're
seeing in the headlines in these past few weeks. But
we've been talking about it before then, right even though
the stock prices are now have been coming down with volatility,
and then you have on top of it the Feds. Potentially,
it was like a ninety percent probability. They they're going
to cut a quarter percent rate in December, and now
(30:12):
it's less than half, you know, fifty percent chance.
Speaker 2 (30:15):
I can't tell you how often we see people just
get over committed to one stock because what it's done
in the last few years and never diversify because they
don't here here's the classic. They don't want to pay
capital gains tax. They don't want to you know, lock
in any of that profit because think of the silliness
(30:38):
of that. Okay. So let's say you were one of
the people out there and there's many and many of
our clients that have made tremendous amount of money on
these names, like in Nvidia. I mean, you know, one
hundred percent, fifty percent, five hundred thousand percent, and you're going,
no way, I'm going to make more. I'm going to
(30:59):
make more. And besides, if I if I sold right here,
i'd pay you know tax. Okay, but don't forget. So
let's say you started with one hundred thousand dollars in
these positions and now it's you know, five hundred thousand dollars. Okay,
but then you watch it go back down to two
hundred thousand, giving up three hundred thousand dollars. I can
(31:20):
promise you your tax isn't going to be three hundred
thousand dollars on a four hundred thousand dollars gain. It
might be one hundred thousand. But the reality is is
that we're in a very dangerous time right here on
these valuations of the AI. And I don't know if
(31:42):
I don't want to say it's a bubble necessarily because
the infrastructure spending to support you know, this Fourth Industrial
Revolution is real dollars by the way, the building into in,
the committing in and infrastructure and raw materials and minerals
and so on and so forth, that's real.
Speaker 3 (32:03):
But are the prices of the stocks baking all that
future optimism in a little too soon?
Speaker 2 (32:10):
Yes? So this is where the key that the key
is true diversification. Don't think if you have mutual funds, Oh,
I've got this tech fund or this international fund, or
this growth and income fund or and we look at
so many of these that just completely overlap, they're perfectly correlated.
They a lot of times have the same top ten holdings,
(32:33):
just in different percentages. And boy, let me tell you.
If the shoe drops, you will see you know that
that fifty percent profit, that one hundred percent profit literally
can go away overnight. Please give us a call. Don't
let that happen to you. It's not worth it because
(32:53):
even if you have to pay tax, you still are
locking in a record amount of money. Now, I'm not saying,
you know, gosh, sell everything. No, we believe in the
in stocks that we believe in proper diversification. We believe
that there's opportunities in many different ways. We found great
(33:15):
investments this year in the alternative strategy space that we
are correlated to stop.
Speaker 3 (33:21):
We just created another custom structured investment that's going to
trade next week.
Speaker 2 (33:25):
We found great exactly, we have another custom structured note
that we're placing people in next week with what an
eleven and a quarter percent ten and a half percent
annual dividend that we'd love to explain more to you
in a in a personal consultation. We have great low
volatility investments such as different real estate positions, different structures
(33:50):
that that happens, even a lower volatility measurement to bonds.
So you absolutely need to give us a call. It's crucial,
especially setting yourself up at the end of this year
for a great year next year, because so often how
you start the year is indicative of what type of
year you'll have.
Speaker 4 (34:11):
I've heard that before.
Speaker 2 (34:11):
You've heard that for so call nine one six nine
six seven thirty five hundred, and we need to clarify
a little bit of what that, you know, when we
dive into the weeds. Okay, so let's say that there
there is this this almost like a shared revenue being
traded around, you know, several companies. What would that mean
(34:34):
to a company like Nvidia potentially and their stock price?
I mean, we've got a little bit of analysis on that,
and that's where I really got like just scared, because
how many people are just sitting on millions of dollars
you know, and billions of dollars in profits on the
(34:54):
mag seven stocks like Microsoft and Vidia on crypto like
like bitcoin, and what it could do to both of those. Again,
we were just digging into this. We don't know how
much of this is true, but some of the data
supporting this, this this thesis, well.
Speaker 3 (35:14):
Just just taking open AI by itself, right, Okay, it
could be true.
Speaker 4 (35:18):
Open eye.
Speaker 3 (35:18):
We we're seeing, you know, you see the numbers on
open Aye as far as the profits and losses that
they're making. So you have open Ai as kind of
an example of that. We've mentioned Microsoft, Open Ai and
Video and Video's got a lot of profits. Microsoft's got prout,
Google has a ton of cash, right Apple. So but
you have like open ai where they announced their investment
(35:42):
commitment to Oracle and then Oracle jump by twenty six percent.
Speaker 4 (35:46):
Since then it's come down.
Speaker 3 (35:47):
But it's just okay, you have a three hundred billion
dollar commitment, but you're not profiting three hundred billion dollars yourself,
right exactly, I mean, just so then it's the prospect
of oh well, then over the next five years, like
Opening Eye is gonna be profiting and they're gonna definitely
or maybe they do through through you know, ownership, right,
(36:09):
equity interest, Nvidia takes equity interest, and or I mean
Oracle and open Aye, whatever the case may be. But if,
like you said, all of it are part of it,
a big portion of it is true, then you'll start
to see this unravel and then these lofty valuations that
these tech companies which you've already seen starting to pull
(36:31):
back because of valuation concerns that'll just continue on and
it could very well be something like what we saw
in April, which was a catalyst of the FEDS right
coming out, well, not the Feds, I'm sorry, the tariffs
you know, coming out, but then also Deep Seek, where
(36:52):
we had Deep Seat come out and said, oh, they
spent you know, so many millions.
Speaker 2 (36:55):
Of dollars on versus billions instead of.
Speaker 3 (36:58):
Billions and bills, you know, hundreds of billions of dollars, right,
And we saw these names go down by.
Speaker 2 (37:03):
Forty percent more or more more fifty sixty seventy percent.
Speaker 3 (37:07):
So it could it could easily, you know, uh, turn
into something like that, just because after April and May.
I mean, if we think about it, look after April
and May, what has fundamentally really changed with.
Speaker 4 (37:20):
The AI space.
Speaker 3 (37:23):
They've advanced some things and maybe some new chips are
coming out, but other than that, I mean, it's been
pretty much the same.
Speaker 2 (37:30):
I haven't seen the revenue generation from AI didn't increase
at the same rate that the stock prices increase because
they're betting again, like you've said earlier, to come, not
on the actual revenue and profits and earnings that are
happening now exactly, and that's the scary thing.
Speaker 3 (37:47):
And you're seeing, you know, some market signals and some
big investors out there feel soft bank. Michael Burry has
been on the news recently one of the big.
Speaker 2 (37:56):
Saying contrarian and short sellers has bought puts on a
massive scale on Nvidia just recently. Michael Berry, it's somebody
like that. Yeah, again, exactly, I.
Speaker 4 (38:11):
Think you did.
Speaker 2 (38:12):
He made he Hume is one of the things that
I look at is definitely really skewing on on the
put side versus the call side. So that means that's
a bearish indicator, not a bullish indicator.
Speaker 3 (38:25):
Yeah. But there's also a big correlation with bitcoin and cryptocurrency,
and you've been seeing cryptocurrency having a pretty big pullback
as well. I mean Bitcoin's gone down I think twenty
something percent, almost twenty nine percent at one point. And
that could be another risk too, where if there's some
unraveling of some of these AI speculative you know, pricing
(38:50):
in some of these stocks that can tie into a
bitcoin and bitcoin itself can have even a further So
if in Vidia, for example, drop sec forty like it
did in April and may loan defaults could increase force
twenty three billion in bitcoin selling and then that could
(39:12):
bring bitcoin price of bitcoin down to fifty two thousand dollars. So,
you know, like we said, we're not saying this is
one hundred percent. It was an interesting read. It was
something that caught our attention. We'll do some more digging.
Speaker 2 (39:27):
Portfolio managers do versus advisors. Do advisors typically sell you stuff.
Portfolio managers are responsible planners. Portfolio managers are responsible for
creating your custom portfolio, actively managing that custom portfolio, making
sure that you have true diversification, which is focusing on correlation,
(39:54):
not just you know, different brand of different investments and
oh I'm in this stock, this bond, so automatically I'm diversified.
Well more more so, much more so. The fund portfolio
management more.
Speaker 3 (40:06):
So funds and mutual funds, like you said, because there's
a correlation, and sometimes they have the very big names
that we're talking about. And why do they do that, well,
because the portfolio managers and fund managers they want to
get bonuses at the end of the year. And how
do they get bonuses because they need to outperform the benchmark,
or at least keep up with a benchmark. Well, how
do you keep up with a benchmark or outperform it.
(40:27):
You got to have the very same names that are
driving that benchmark, and what drives the S and P
five hundred, well thirty four percent of it or more
is coming from the mag seven names. So if you
don't have mag seven names and you're trying to beat
it with the other names in.
Speaker 4 (40:39):
There, good luck. It's pretty hard to do. And then
are you gonna Are you going.
Speaker 3 (40:43):
To take that chance to be the magic picker out
there and beat the market and risk your bonus, your
annual bonus on that.
Speaker 4 (40:52):
Maybe not.
Speaker 3 (40:53):
So that's that's why when you look at your priced
growth fund, Fidelity growth fund or Vanguard growth fund, all
those growth funds you're going to have, you say, hey,
top ten holdings.
Speaker 4 (41:01):
You look at the top ten holdings and open up
the hood, and those.
Speaker 3 (41:04):
Top ten holdings usually are very similar amongst one fund
to the other fund.
Speaker 2 (41:09):
So let me put it simple. If you have two
hundred and fifty thousand, five hundred thousand, a million dollars
or more in mutual funds, my first question is why.
My second question is why aren't you meeting with your
advisor and giving us a call at nine one six
ninety six, seven thirty five hundred. We will absolutely do
(41:32):
a free review. We're not going to beat you up
for what you have, but we're going to point out,
you know, things that we know and that we can
see that might be areas of concern. And we'll do
that with absolutely no obligation by calling nine one six
ninety six, seven thirty five hundred and getting on John
Scambray and Duseepi Viskani's calendar. Hope you enjoyed the show,
(41:54):
Have a wonderful Saturday. We'll talk to you next week.
Speaker 4 (41:57):
Have a great weekend.
Speaker 1 (42:00):
Has used to the fat
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.
Speaker 2 (00:14):
Welcome to the Wise Money Guys Radio Show. I'm your
co host John Scambram here with my partner Wisconsin. And
if you don't know it already, we're certified portfolio managers
that specialize in helping people who are retired are about
to retire, manage their money, create their plans, and just
help them live out their their financial dreams, specifically pre
(00:36):
retirement and during retirement. So as always, if you like
our show, give us a call at nine one six
nine six seven thirty five hundred. But before we really
dive in, I want to start off by saying we
have breaking news that we're not one hundred percent sure.
We're going to save that for a little bit later,
(00:58):
that you're absolutely need to know and hear, because it's
if it's even half true, you know that the darlings
of the stock market this year are in for a
real ride. And if we think about it, this week,
it's been a pretty good roller coaster ride already. I mean,
(01:19):
I get it relative to nothing, you know, the year
to date, not not that big of a deal, but
but or relative to may as you say. But still,
this news is so juicy, and I can give you
a hint. It's about one of the Mag seven stocks
that everybody loves. And again it's breaking news. We've already
(01:41):
seen movement. If you or anybody has this position, you're
going to want to give us a call, come in
and see us because we can show you, especially if
you have a lot of shares in the Mag seven,
on how to strangle and straddle and hedge and protect
that position and potentially lock in its value and still
(02:03):
generate great returns from it.
Speaker 3 (02:07):
But past performance doesn't predict future yes results And you
can look at more informator get more information from our
website wisemoneyguys dot com and we have a lot of
cool information tools, calculators you can scroll all the way
to the bottom reader lovely and exciting disclosures, but also
our bios more about you know, John's background, my background
(02:30):
we talk a little bit about on the shows as
well as a firm. You can also ask us a question.
So if there's a topic or area that maybe we
haven't talked about or is an interest of you.
Speaker 4 (02:40):
You can email us at question at wise money.
Speaker 2 (02:42):
Guys, you five definitely email us. We never disclose personal
information and we don't sell people's information. By the way,
if you don't know, Charles, Schwab is really our favorite
platform that we do manage our clients money through Custodian.
It's it's it's a i'd say, and compare contrast it
(03:07):
to Fidelity and nothing against Fidelity. We also have clients
in Fidelity, but I like the Schwab platform better support.
Speaker 3 (03:15):
The support that we get from Schwab is ten times
better when we need an answer, typically get an answer
in five minutes or less, where it's ten times faster
than what we've experienced in Fidelity. Surprisingly enough, because we thought,
you know, Fidelity Swab, well, they're the two big behemoths and.
Speaker 2 (03:36):
Even better than Schwab.
Speaker 3 (03:37):
Yeah, you would expect, I mean I would, I would
expect at least the saying because they're the two big,
big behemoths, you know, and the brokerage at least the
retail brokerage side of things, and we represent them on
the institutional side, so we don't. We don't Custody our
own clients money, our client's money.
Speaker 4 (03:55):
It's a very important Schwab.
Speaker 3 (03:56):
Interactive brokers, Fidelity paychecks and we use all these big
names and the money is there. We just manage on
their behalf put together the financial plan.
Speaker 4 (04:07):
Albeit but yeah.
Speaker 3 (04:08):
We're very surprised on the differences between the help and
support that we get when needed from Fidelity versus Schwab.
Speaker 4 (04:16):
Hopefully it improves, but but we'll see.
Speaker 2 (04:19):
So what that really means is if you already have
a Schwaber Fidelity account, giving us a try and hiring
us to see why. We consider ourselves probably the best
UH in the in the region, in the West best
and I like that it Ryan is the best in
the West. Is pretty simple to do. So with that,
(04:41):
let's let's dive in a little bit. Let's let's not Yeah,
we have the idiot, we have Nvidia earnings. We got
to talk about. We have some economic data that's coming out.
We had non non farm payrolls job numbers essentially, which
were on pause because of the government shutdown.
Speaker 3 (04:59):
Right, so we'll talk a little bit about that unemployment
figures and then dive into the breaking news of just
from some of the information that we've read and not
have not dug far enough to see if it's legitimate,
you know, truly legitimate or not.
Speaker 4 (05:18):
But it has a pretty good ring to it.
Speaker 2 (05:20):
Well, here's what it does. It really makes you be cautious.
And so what I like about this that we're going
to share is it's just a demonstration of we just
don't blindly, you know, put money into specific positions, shout
out following the news, looking at technicals, looking at financials,
(05:41):
trying to get our hands on various things to make
a decision if it's time to get out of something
and get into something else, or if it's time to
add something. Don't forget that. For the last what two
months or so on this show, we've been telling people
be cautious here, don't don't don't go bet in the
(06:04):
farm on the tech sector, be choosy and gosh, lock
in profits and regret that you locked in some profit
and you might have made a little bit more money
on paper versus you didn't lock in profits. And now
you've watched some of those profits go up and smoke
because you mentioned in Nvidia earnings and you look at Nvidio,
(06:27):
you know, broke above two hundred and now it went
down into the one seventies. I I didn't look how
it closed on Friday, but but I mean, that's a
ten percent swinging right there. And if you didn't lock
in some profit, you know, you potentially gave up you know,
ten percent, and so any well, and.
Speaker 3 (06:49):
I don't think that's a reflection a direct reflection of
the earnings because they crushed earnings once again.
Speaker 2 (06:55):
Crushed as an understatement.
Speaker 3 (06:57):
Yeah yeah, so and after hours when they reported, the
stock was up after hours five percent. But then the
following day they everything was up, you know, on Thursday,
and then things just started breaking apart and then went down,
and we had some Fed speakers. Job numbers came out,
(07:17):
So that poured a little bit of cold water on
the betting markets as far as are the Fed's going
to cut rates or not.
Speaker 4 (07:25):
It was like ninety percent and it's fifty percent. Now
it's in the forty percent.
Speaker 3 (07:28):
I think, maybe even lower if the Feds are going
to cut another quarter point in December when they meet.
Speaker 4 (07:34):
So that put a little cold water on the market.
Speaker 3 (07:36):
And then valuations, which surprisingly, you know, it's maybe the
past three or four weeks, I've been seeing headlines and
it's just so funny because I'll see the headlines obviously
every morning, and it'll say stock markets up, and then
I'll give some sort of description of why the market's
up or why the market's down. Right, But now you've
been seeing these past at least a few weeks of
(07:57):
why we've had some volatility, and especially the tech sector
of valuations, valuations, valuations. Well, there was no headlines of
valuations when Nvidia was two hundred dollars a share, exactly.
But there are one hundred and eighties a share, seventies.
Speaker 2 (08:14):
Concerned about the valuation.
Speaker 4 (08:16):
Yeah, after they after they crushed earnings.
Speaker 2 (08:18):
Well, you know what, you know what else is interesting
and it's kind of shocking. Actually we talked about this
during the week. Is that Microsoft and Nvidia, if you
take either one of the market value stocks, that the cap,
the market value is bigger than all other markets stock
markets in all the other countries except for China, and
(08:44):
and and that is just unbelieved Japan, except for Japan,
thank you. And Apple by itself is as big or
bigger than the entire Chinese market cap of their market,
of their stock market. So well, yeah, and those three
companies are here, so it's crazy tells you if you're
not investing just or think or if you don't think
(09:06):
that the US is still the land of the greatest
opportunity to live and prosper just from a financial perspective. Boy,
it's not somewhere else, that's for darn sure.
Speaker 3 (09:19):
Well there are other companies, you know, emerging markets and
internationals actually had a prediscint year so far this year.
Speaker 4 (09:25):
But everything is so connected these days.
Speaker 3 (09:27):
I mean, like Apple, right, if China has bad news
on manufacturing with animal so obviously, but it's crazy.
Speaker 2 (09:35):
So much manufacturing, it's crazy.
Speaker 3 (09:37):
But but to your point, when the US has something
material going on, whether it's the Federal Reserve or Nvidio
earnings or whatever, and we have a down day, Asian
markets will open up, you know later on the same
same day and at night, you know, in the US
(09:57):
and they have a down day, and the the description
the headline is not what's specifically in the Asian markets,
but it's because what happened in the US markets or
US companies.
Speaker 2 (10:07):
All right, So on our next segment, we are going
to break the news that we've been talking about. We're
prefacing it with gain news. There's there's no there's no Uh. Well,
I guess for a while there was things that would say, oh,
fake news, and they turned out to be fake. But
but even if this uh segment is something true, something
(10:29):
something to heed caution on, you absolutely have to stay tuned,
just real quickly before we dive in. Tell us about
the job numbers, because again, those are crucial when it
comes to the Fed's decision on whether it's a lower
interest rates, because we're actually seeing the longside of the
yield curve in treasuries creeping up. So people always think that, oh,
(10:53):
the Fed cut rates, that's it, you cut FED funds
and automatically interest rates go down. Now, we have seen
improvement in mortgage lending rates, and the shorter side of
the curve, which is a normal yield curve, has has
gone down a little bit. But it's concerning that the
long side of the curve is actually going up, which
(11:15):
means people are selling out of longer dated treasuries and so.
Speaker 3 (11:23):
And yeah, and all that means to the regular retail
you know, citizen out there is Fed cuts rates. The
tenure treasury is kind of barometer that initially dip down.
You saw, yeah, you saw mortgage you know, thirty year
mortgage rates start to decrease, got in car loans start
(11:44):
to decrease, but then they started creeping back up again.
And so that's why if these you know, ten year
yield treasury starts creeping back up again, doesn't matter if
the Feds are lowering rates. They did this in twenty
twenty four where they cut rates three times, and just
before the cut rates, we saw mortgage interest rates right
(12:05):
start to dip, but then after the cuts they actually
spiked back up and then went back to like seven percent,
So it didn't really help anybody out. And so that's
where that can be very important to watch that number
and where the tenure treasury is because it doesn't matter
or fed's cut rates. Initially people think, oh I can
go get that loan for that car, or maybe I
can go forward that house now because it's you know,
(12:26):
quarter percent lower.
Speaker 4 (12:27):
No, it doesn't actually translate directly.
Speaker 3 (12:29):
Like that, but what it does directly translate to is
the CDs, the money market rates, the savings rates. Those
will will come down immediately when Feds start cutting rates,
and that's where you have to pay attention to as well,
because then how are you investing your money you know,
if you're earning four or five percent on some promo
(12:49):
money market or.
Speaker 4 (12:50):
CD rate, that's great, but especially CDs.
Speaker 3 (12:53):
And we had a meeting with a potential client and
they had fourteen three fourteen month CDs that were locked
in at four and a quarter, which four and a
quarter is pretty good right now. The problem is is
when they when they mature, when that fourteen months is up,
what a rates are you know what a rate's going
to be.
Speaker 2 (13:13):
At that point? Sure and right now.
Speaker 3 (13:16):
And the discussion that we had with them was, you know,
well you can get into you know, JP Morgan or
wals Fargo, these are the banks that are offering these
CDs or money markets right promo higher rates. You can
get into their bonds right now they're paying five or
north of five. But it's not going to be that,
you know, fourteen months if everything starts to go down.
But to the job numbers, data came out in September
(13:40):
non farm payrolls, so basically employment increased by one hundred
and nineteen thousand, much higher than what was anticipated.
Speaker 4 (13:50):
It's good news, but the good.
Speaker 2 (13:53):
News in an upside down world, right it's inverse good news.
And I used to talk about this a lot a
lot lately that or recently, that bad news was good
news when it came to decisions that we wanted to
fed the Central Bank to make and that's kind of
where we're at.
Speaker 3 (14:12):
Well, No, that was partly you know, after April and May,
when the market you know, corrected over twenty percent, market
started rebounding because aiuphoi was starting to come back. But
then more so it was a FED, a federal reserve
was in focus, and the rate cuts and then taking
a stand to just leave rates, you know, stand pat
(14:33):
to now having a discussion of like yep, I think
we can start cutting rates right now, and so that's
a stimulus to the overall market. But if you have
good news that the economy is resilient and it's still
doing good and it's strong, then that means that it's
not giving much ammal for the Feds to continue to
cut rates. Therefore, there's no more of that stimulus that
(14:56):
is going to be fed into the stock market, and
we're seeing a little bit of that and why the
volatility is kicked in recently into the stock market. So
I take it as good news because it just means
that we're still being resilient.
Speaker 4 (15:10):
On the other side, which you're going to get excited
about here, John.
Speaker 3 (15:14):
Is unemployment rate rose from four point three to four
point four percent. You're going to ask, well, why if
we had stronger numbers in September than what was expected,
how did unemployment go up?
Speaker 4 (15:25):
Well, partly do.
Speaker 3 (15:26):
You because of BLS revised the numbers in August from
positive twenty two thousand jobs to negative and four thousand jobs.
Speaker 2 (15:36):
You can't trust government data. I mean this, this game
of basing things on bad data, which mostly is political
narrative data, is just it's ridiculous. That's why you need
people like Giuseppi and I to actually dive into the
(15:57):
investment the portfolio, you know, be at the helm of
potentially making changes by knowing the underbelly of these things.
And you just can't blindly, you know, trust, you know,
I guess the saying has always been trust, but verify. Boy.
(16:18):
I think it's it's hard to trust and and and
and double verify because the numbers just aren't, you know,
ever correct. And they base these numbers, you know, on
on decisions, or they take these numbers and base their
decisions on them, and it just drives me so it's hard.
Speaker 3 (16:34):
To if you get to revise it and revise it,
especially the revisions revisions have has been more biased to
the downside versus the upside, So it is hard to trust.
And you know, it's funny. I just watched a movie
last night. I was just up and I was on
YouTube TV and a movie popped up. I'm gonna see
if you know this movie, if you got to know
this movie for your time background, But it talked about
(16:58):
part of that movie is all about trust, right, and
it was. It was it was a world where this
this kid was living in between and trying to live
by his father, who is a hard working blue collar
worker in the Bronx. But then he lived next to
a bar. Right, they had the mafia and the head
boss or the captain Coppo of the of that region
(17:21):
took a very a big lacking to this kid.
Speaker 4 (17:25):
No, the kids, the kids.
Speaker 2 (17:26):
Not the kid, but the father.
Speaker 4 (17:28):
No, No, it was Chaz Pilementary.
Speaker 3 (17:30):
And uh, the kid's name was Colojuro so that should
give a hint.
Speaker 2 (17:35):
But it was all about my mind was Bronx tail
right exactly?
Speaker 3 (17:39):
Yeah, But it was all about you can't you can't
trust nobody.
Speaker 2 (17:44):
And you can't trust sadly, you can't trust trust the data.
I mean that he's out of these by the way,
that's Bureau of Labor Statistics. You can't trust their data,
you can't, you know they and and politicians always tout, oh,
according to the CBO or the BLS, or or or
the federal or the FRB Federal Reserve Board, you know,
(18:07):
on and on and on. What you can only trust
is what you see in your results. And that is
where we are your warriors to make sure that we
know and have created the plan that you need, and
we know and have created the investments that you have,
and we know when and again we're basing it on
(18:28):
what we can dig into. So that's kind of a
good save way to dig into this this breaking story
which is on the Darling in VideA, and I mean
I got chills when I read. Now you all, uh
and who's ever listening may be familiar with just recently
(18:50):
we had a ponzi scheme, you know, with it with
the crypto exchanges, right and you had I forget his
name that's now in prison because they were, you know,
taking some people's money and that was coming yes FTX,
thank you taking it in and saying that money coming
in was was return on investment, that your investment, and
(19:13):
then they were paying out people, you know, on that
new money that was coming in and so, which is
what a ponzi scheme really is until the money stops
coming in. And then now people who want to get
their money out have no money to get out because
they find out that the returns and the performance just
(19:35):
really weren't there. So it's the classic definition of robbing
Peter to pay Paul. And so listen, the mag seven
has had a tremendous year, unbelievable your turns and everything
has been about AI AI this, AI that, and we've
spent a lot of time trying to find indirect ways
(19:57):
like energy investments, you know, software and data center, data
centers or the people who literally physically contruct construct those
things on ways to play I play AI that just
weren't you know, the chip or the software or the
machines or the quantum computing and things you know like that,
(20:17):
because you know things were getting lofty, And go ahead
and share what what you sent to me. That literally
gave me chills because as we said, this this breaking story,
even if it's half right. Even if it's quarter right.
The pressure it could put be put on the valuations
(20:38):
of everything having to do with AI and the increase
in profits that that has been told to us. But
then if any of that becomes untrue, we will see
a massive crash in the tech sector. So if you
don't have somebody who's in your corner watching these things,
making sure you're properly diversified, making sure that all your
(21:01):
investments aren't tied to one sector and one category investments,
i e. You know, stocks in the tech sector, boy,
you could be in for a world of hurt. You're
gonna want to call nine one six nine six seven
thirty five hundred, but share it just that because like
I said, I mean, we.
Speaker 3 (21:18):
Don't have much much time left in this segment, but
so we'll get to it in the next But the glimpses.
We've already talked a little bit about open ai because
there's been a lot of investments between open ai and
other companies, Oracle being one of them, and three hundred billion,
and we were kind of questioning, well, if they're if
they're investing three hundred billion over five years in Oracle,
how much are they actually making in revenue now right,
(21:40):
and they were like negative and I think they were
slightly positive.
Speaker 4 (21:43):
Well, how they're going to get three hundred billion dollars
to the oracle? Right?
Speaker 2 (21:47):
Yeah, how do you get three hundred billion dollars in
Oracle purchases? Nobody's gonna lend you, you know, two hundred
and eighty you know, billion dollars. We're going to tell
you more about that. You absolutely have to stay tuned.
And the store we've been alluding to, we didn't break
the news, but we're certainly diving into it and trying
to corroborate it with more research and evidence that we
(22:09):
can find. But it's investigative journalists, well, you know, I
mean you have to be you know, that's that's actually
a really good point. I mean, when you're when you're
somebody's money manager, plan er, you know, financial consultant, and
you help them with something so significant as their their
wealth and legacy and retirement income, so on and so forth,
(22:30):
you have to be investigative journalists.
Speaker 4 (22:34):
Right.
Speaker 2 (22:35):
But that's what always drives me crazy that so many people,
you know, are worried about paying a small fee, and
our fee on average is one percent per year, and
and and generally it gets paid.
Speaker 4 (22:48):
Actually it's actually our average general it's actually less. The
overall whole.
Speaker 3 (22:53):
Book of assets that we manage is actually point ninety
three because it can range below one percent. It could
be above one percent on the assets and household that
we manage.
Speaker 2 (23:02):
And so many times when we take over somebody's portfolio
again we're getting sidetracked, and we find that they have
mutual funds and closed end funds and ETFs and all
these things, and then we show them what the embedded
management and fees expenses are inside of those. Often they're
they're as much as our fee. And so when we
build them a different portfolio with positions like individual bonds
(23:25):
and individual stocks and alternative investments and so on and
so forth that don't have those things in them, we
sometimes we pay for our fee just right there. So
and that's analysis we do when you sit down for
a new obligation consultation and we review your portfolio and
your situation and we show you, you know, how we
do things and how it might be better for you,
(23:47):
and and just have a great.
Speaker 3 (23:49):
Basically how to get you from how to get you
from point A to point B, which is still some
part of the planning phase as well.
Speaker 2 (23:54):
But we've been dodging it, okay, So here it is.
You know, I mentioned just briefly that there was a
couple of Ponzi schemes. The last one was the crypto
uh crypto exchange Ponzi scheme. Obviously everybody knows the Bernie
made off one uh before that. But here we are
that there might be a Ponzi scheme. This is the
(24:14):
This is the news that there might be a Ponzi
scheme in the AI, you know space, involving companies like
open Ai and Nvidia, Microsoft, Microsoft, so on and so forth.
So if you have those in your portfolio, you absolutely
need to come and see us, and we'll show you
(24:37):
how potentially building you out a portfolio for you know,
now and in the future is just crucial. And you
can't just rely on such a small segment of the
investing world, you know, to be your lifelong sectually pretty
large though well ye well meaning small and numb. Three companies,
(25:01):
five companies, seven companies. Yeah, you know, but it's crazy
how income investments or divid in pain investments because none
of those stocks pay any dividend or EPLE does. Oh yeah,
what what so which almost pays for our fee. But
but here it is, you know, yeah, so what we
you know, we say Ponzi scheme, but it's not a
(25:21):
Bernie Madoff scheme. You know, it's but uh, there was
an article. There was actually something on x that was interesting.
I read through it.
Speaker 3 (25:33):
It was sent to me by a buddy of mine
who's also an advisor. I sent it to John and
you know, we'll have to look more into it to
see the validity of it.
Speaker 2 (25:43):
But in Vidia accounts received sense it's crazy.
Speaker 3 (25:47):
Yeah, in videos accounts receivable, right, so all the money
that should be coming in exploded thirty three point four
billion dollars. But here's the important part of it is
customers are taking a longer period of time to pay up.
Speaker 4 (26:03):
It was forty six days now it's fifty three days.
Speaker 3 (26:07):
Which represents to pay up, you know what they basically
committed to Nvidia, whether it's chips or what have you.
So there's ten point four billion at risk that could
never be collected who knows, which.
Speaker 2 (26:20):
Would drastically alter their results.
Speaker 3 (26:23):
Yeah, and Nvidia is sitting on almost twenty billion dollars
of unsold chips, so it's contradicting to the insatiable demand
that they put out there on their earnings calls and
how much demand they have when they have this kind
of law. Yeah, it's backlog, well not a backlog, but
this but the stock you know, stockpile. And it could
(26:43):
be because they've been spoken for, but and it's been
accounted for in their in their in their Excel spreadsheets,
you know, the paid counters, but not paid for, so
therefore it cannot be released. Right, So just kind of stockpiling.
And Vidia reported nineteen point three billion in profit, but
only fit fourteen and a half that was in real cash,
(27:05):
which is a conversion of seventy five percent. The piers
when you look in at amongst peers, the peers are
at ninety five percent. So there's some concerning things that
are going on in the accounting, yeah, and the accounting portion.
The other the big thing, which is like the potential
Ponzi scheme, yes, is the loop of companies that are
(27:26):
funding each other, right, Microsoft, open Ai, Oracle and Video.
Speaker 2 (27:30):
It's a circle revenue.
Speaker 3 (27:32):
Yeah, they're calling it vibe revenue where dollars circulate between
each other, Like, oh, open Ai is going to commit
to three hundred billion dollars of investment with Oracle. Oracle
is going to, you know, commit X amount of billions
of dollars to buy x amount of chips over the
x amount of years. You know, with Nvidia, Microsoft is
(27:55):
going to you know, commit to Oracle. Oracle is going
to commit to Microsoft over x amount of years an
x amount of purchases of product or service or whatever.
But no, there's no true and to customer demand, and
so is does this and so like the point that
we brought up was like open Ai, you know, open
(28:17):
Ai themselves and let me see if I have data
because I did read they had Yeah, open Ai.
Speaker 4 (28:23):
Here you go.
Speaker 3 (28:25):
So open Ai loses five point six billion dollars annually.
Speaker 4 (28:30):
They lose.
Speaker 3 (28:30):
Yeah, they're generating no revenue while making enormous for purchase commitment,
the commitment. So, and that was what we had talked about,
I think maybe a few radio shows before. When when
they announced a three hundred billion I'm pretty sure it
was a three hundred billion billion investment commitment to Oracle.
And then Oracle literally jumped up their stock price to
like twenty six percent. Now it's come down since then,
(28:54):
but it literally spiked their stock price way up but
now you're saying, okay, open Aiye, Oracle, Microsoft in video,
and they're all kind of committing to each other. And
this is like kind of the side argument, you know,
and some of the people on the other side of
the table saying like, oh, we have all this investment,
you know that Trump is has has committed countries or companies,
(29:18):
you know, trillions of dollars.
Speaker 4 (29:19):
But has it actually come to fruition.
Speaker 3 (29:22):
Right, The same argument is going on right now with
all of this investing future investing. Not hey, we gave
you three hundred billion dollars, give us your product, or
give us your product when it's available. It's all this
we're committing to the Yeah, it's kind of like, yeah,
it's kind of like an loi, right, we we intend
to invest x amount over the next many years. And
(29:45):
because of that news that's circulating around, it's pumping the.
Speaker 2 (29:49):
Stock prices up exactly, which.
Speaker 3 (29:51):
Then starts to become a valuation problem, which now you're
seeing in the headlines in these past few weeks. But
we've been talking about it before then, right even though
the stock prices are now have been coming down with volatility,
and then you have on top of it the Feds. Potentially,
it was like a ninety percent probability. They they're going
to cut a quarter percent rate in December, and now
(30:12):
it's less than half, you know, fifty percent chance.
Speaker 2 (30:15):
I can't tell you how often we see people just
get over committed to one stock because what it's done
in the last few years and never diversify because they
don't here here's the classic. They don't want to pay
capital gains tax. They don't want to you know, lock
in any of that profit because think of the silliness
(30:38):
of that. Okay. So let's say you were one of
the people out there and there's many and many of
our clients that have made tremendous amount of money on
these names, like in Nvidia. I mean, you know, one
hundred percent, fifty percent, five hundred thousand percent, and you're going,
no way, I'm going to make more. I'm going to
(30:59):
make more. And besides, if I if I sold right here,
i'd pay you know tax. Okay, but don't forget. So
let's say you started with one hundred thousand dollars in
these positions and now it's you know, five hundred thousand dollars. Okay,
but then you watch it go back down to two
hundred thousand, giving up three hundred thousand dollars. I can
(31:20):
promise you your tax isn't going to be three hundred
thousand dollars on a four hundred thousand dollars gain. It
might be one hundred thousand. But the reality is is
that we're in a very dangerous time right here on
these valuations of the AI. And I don't know if
(31:42):
I don't want to say it's a bubble necessarily because
the infrastructure spending to support you know, this Fourth Industrial
Revolution is real dollars by the way, the building into in,
the committing in and infrastructure and raw materials and minerals
and so on and so forth, that's real.
Speaker 3 (32:03):
But are the prices of the stocks baking all that
future optimism in a little too soon?
Speaker 2 (32:10):
Yes? So this is where the key that the key
is true diversification. Don't think if you have mutual funds, Oh,
I've got this tech fund or this international fund, or
this growth and income fund or and we look at
so many of these that just completely overlap, they're perfectly correlated.
They a lot of times have the same top ten holdings,
(32:33):
just in different percentages. And boy, let me tell you.
If the shoe drops, you will see you know that
that fifty percent profit, that one hundred percent profit literally
can go away overnight. Please give us a call. Don't
let that happen to you. It's not worth it because
(32:53):
even if you have to pay tax, you still are
locking in a record amount of money. Now, I'm not saying,
you know, gosh, sell everything. No, we believe in the
in stocks that we believe in proper diversification. We believe
that there's opportunities in many different ways. We found great
(33:15):
investments this year in the alternative strategy space that we
are correlated to stop.
Speaker 3 (33:21):
We just created another custom structured investment that's going to
trade next week.
Speaker 2 (33:25):
We found great exactly, we have another custom structured note
that we're placing people in next week with what an
eleven and a quarter percent ten and a half percent
annual dividend that we'd love to explain more to you
in a in a personal consultation. We have great low
volatility investments such as different real estate positions, different structures
(33:50):
that that happens, even a lower volatility measurement to bonds.
So you absolutely need to give us a call. It's crucial,
especially setting yourself up at the end of this year
for a great year next year, because so often how
you start the year is indicative of what type of
year you'll have.
Speaker 4 (34:11):
I've heard that before.
Speaker 2 (34:11):
You've heard that for so call nine one six nine
six seven thirty five hundred, and we need to clarify
a little bit of what that, you know, when we
dive into the weeds. Okay, so let's say that there
there is this this almost like a shared revenue being
traded around, you know, several companies. What would that mean
(34:34):
to a company like Nvidia potentially and their stock price?
I mean, we've got a little bit of analysis on that,
and that's where I really got like just scared, because
how many people are just sitting on millions of dollars
you know, and billions of dollars in profits on the
(34:54):
mag seven stocks like Microsoft and Vidia on crypto like
like bitcoin, and what it could do to both of those. Again,
we were just digging into this. We don't know how
much of this is true, but some of the data
supporting this, this this thesis, well.
Speaker 3 (35:14):
Just just taking open AI by itself, right, Okay, it
could be true.
Speaker 4 (35:18):
Open eye.
Speaker 3 (35:18):
We we're seeing, you know, you see the numbers on
open Aye as far as the profits and losses that
they're making. So you have open Ai as kind of
an example of that. We've mentioned Microsoft, Open Ai and
Video and Video's got a lot of profits. Microsoft's got prout,
Google has a ton of cash, right Apple. So but
you have like open ai where they announced their investment
(35:42):
commitment to Oracle and then Oracle jump by twenty six percent.
Speaker 4 (35:46):
Since then it's come down.
Speaker 3 (35:47):
But it's just okay, you have a three hundred billion
dollar commitment, but you're not profiting three hundred billion dollars yourself,
right exactly, I mean, just so then it's the prospect
of oh well, then over the next five years, like
Opening Eye is gonna be profiting and they're gonna definitely
or maybe they do through through you know, ownership, right,
(36:09):
equity interest, Nvidia takes equity interest, and or I mean
Oracle and open Aye, whatever the case may be. But if,
like you said, all of it are part of it,
a big portion of it is true, then you'll start
to see this unravel and then these lofty valuations that
these tech companies which you've already seen starting to pull
(36:31):
back because of valuation concerns that'll just continue on and
it could very well be something like what we saw
in April, which was a catalyst of the FEDS right
coming out, well, not the Feds, I'm sorry, the tariffs
you know, coming out, but then also Deep Seek, where
(36:52):
we had Deep Seat come out and said, oh, they
spent you know, so many millions.
Speaker 2 (36:55):
Of dollars on versus billions instead of.
Speaker 3 (36:58):
Billions and bills, you know, hundreds of billions of dollars, right,
And we saw these names go down by.
Speaker 2 (37:03):
Forty percent more or more more fifty sixty seventy percent.
Speaker 3 (37:07):
So it could it could easily, you know, uh, turn
into something like that, just because after April and May.
I mean, if we think about it, look after April
and May, what has fundamentally really changed with.
Speaker 4 (37:20):
The AI space.
Speaker 3 (37:23):
They've advanced some things and maybe some new chips are
coming out, but other than that, I mean, it's been
pretty much the same.
Speaker 2 (37:30):
I haven't seen the revenue generation from AI didn't increase
at the same rate that the stock prices increase because
they're betting again, like you've said earlier, to come, not
on the actual revenue and profits and earnings that are
happening now exactly, and that's the scary thing.
Speaker 3 (37:47):
And you're seeing, you know, some market signals and some
big investors out there feel soft bank. Michael Burry has
been on the news recently one of the big.
Speaker 2 (37:56):
Saying contrarian and short sellers has bought puts on a
massive scale on Nvidia just recently. Michael Berry, it's somebody
like that. Yeah, again, exactly, I.
Speaker 4 (38:11):
Think you did.
Speaker 2 (38:12):
He made he Hume is one of the things that
I look at is definitely really skewing on on the
put side versus the call side. So that means that's
a bearish indicator, not a bullish indicator.
Speaker 3 (38:25):
Yeah. But there's also a big correlation with bitcoin and cryptocurrency,
and you've been seeing cryptocurrency having a pretty big pullback
as well. I mean Bitcoin's gone down I think twenty
something percent, almost twenty nine percent at one point. And
that could be another risk too, where if there's some
unraveling of some of these AI speculative you know, pricing
(38:50):
in some of these stocks that can tie into a
bitcoin and bitcoin itself can have even a further So
if in Vidia, for example, drop sec forty like it
did in April and may loan defaults could increase force
twenty three billion in bitcoin selling and then that could
(39:12):
bring bitcoin price of bitcoin down to fifty two thousand dollars. So,
you know, like we said, we're not saying this is
one hundred percent. It was an interesting read. It was
something that caught our attention. We'll do some more digging.
Speaker 2 (39:27):
Portfolio managers do versus advisors. Do advisors typically sell you stuff.
Portfolio managers are responsible planners. Portfolio managers are responsible for
creating your custom portfolio, actively managing that custom portfolio, making
sure that you have true diversification, which is focusing on correlation,
(39:54):
not just you know, different brand of different investments and
oh I'm in this stock, this bond, so automatically I'm diversified.
Well more more so, much more so. The fund portfolio
management more.
Speaker 3 (40:06):
So funds and mutual funds, like you said, because there's
a correlation, and sometimes they have the very big names
that we're talking about. And why do they do that, well,
because the portfolio managers and fund managers they want to
get bonuses at the end of the year. And how
do they get bonuses because they need to outperform the benchmark,
or at least keep up with a benchmark. Well, how
do you keep up with a benchmark or outperform it.
(40:27):
You got to have the very same names that are
driving that benchmark, and what drives the S and P
five hundred, well thirty four percent of it or more
is coming from the mag seven names. So if you
don't have mag seven names and you're trying to beat
it with the other names in.
Speaker 4 (40:39):
There, good luck. It's pretty hard to do. And then
are you gonna Are you going.
Speaker 3 (40:43):
To take that chance to be the magic picker out
there and beat the market and risk your bonus, your
annual bonus on that.
Speaker 4 (40:52):
Maybe not.
Speaker 3 (40:53):
So that's that's why when you look at your priced
growth fund, Fidelity growth fund or Vanguard growth fund, all
those growth funds you're going to have, you say, hey,
top ten holdings.
Speaker 4 (41:01):
You look at the top ten holdings and open up
the hood, and those.
Speaker 3 (41:04):
Top ten holdings usually are very similar amongst one fund
to the other fund.
Speaker 2 (41:09):
So let me put it simple. If you have two
hundred and fifty thousand, five hundred thousand, a million dollars
or more in mutual funds, my first question is why.
My second question is why aren't you meeting with your
advisor and giving us a call at nine one six
ninety six, seven thirty five hundred. We will absolutely do
(41:32):
a free review. We're not going to beat you up
for what you have, but we're going to point out,
you know, things that we know and that we can
see that might be areas of concern. And we'll do
that with absolutely no obligation by calling nine one six
ninety six, seven thirty five hundred and getting on John
Scambray and Duseepi Viskani's calendar. Hope you enjoyed the show,
(41:54):
Have a wonderful Saturday. We'll talk to you next week.
Speaker 4 (41:57):
Have a great weekend.
Speaker 1 (42:00):
Has used to the fat
Popular Podcasts
Dateline NBC
Current and classic episodes, featuring compelling true-crime mysteries, powerful documentaries and in-depth investigations. Follow now to get the latest episodes of Dateline NBC completely free, or subscribe to Dateline Premium for ad-free listening and exclusive bonus content: DatelinePremium.com
Are You A Charlotte?
In 1997, actress Kristin Davis’ life was forever changed when she took on the role of Charlotte York in Sex and the City. As we watched Carrie, Samantha, Miranda and Charlotte navigate relationships in NYC, the show helped push once unacceptable conversation topics out of the shadows and altered the narrative around women and sex. We all saw ourselves in them as they searched for fulfillment in life, sex and friendships. Now, Kristin Davis wants to connect with you, the fans, and share untold stories and all the behind the scenes. Together, with Kristin and special guests, what will begin with Sex and the City will evolve into talks about themes that are still so relevant today. "Are you a Charlotte?" is much more than just rewatching this beloved show, it brings the past and the present together as we talk with heart, humor and of course some optimism.
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.