September 5, 2024 • 43 mins
The race is heating up, but the markets are cooling down. And, what about Nvidia's reporting? These are interesting times. Hosts John and Giuseppe take a look at what the Fed is up to as we share a new client strategy. Plus, we announce a new Workshop. October 2nd. 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
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 (00:18):
Welcome to the Wise Money Guys Radio Show. I'm your
co host John Scamber and I'm here with my partner
Giuseppe Vescani, and we are certified portfolio managers out of
Granite Bay, California that love helping people who are retired
are about to retire manage their money. If you like
this show and have a question or want to come
in for a no obligation consultation, or more importantly, register
(00:39):
for our last workshop of the year on October second,
from six to seven thirty pm, which is a Wednesday,
by the way, at the Old Spaghetti Factory. Give us
a call at nine one six ninety six seven thirty
five hundred. Let me tell you who should call. So
if you're retired and you're concerned about, you know, the
(01:01):
absolute out of control costs and how much things have
increased and sadly, and we'll be talking about this, how
much more things could potentially continue to increase. You should
attend if you're about to retire and you want to project,
you know, whether or not you'll be comfortable in retirement
(01:25):
with the things you've amassed and the wealth you've created,
and then maybe the potential pensions or social security that
you're you're projected to have. Come to the workshop. If
you can't make that date on October second, you know,
come in for a no obligation consultation again called nine
one six ninety six seven thirty five hundred. So just
(01:48):
have to be the first thing we got to talk
about as this whole in video and Vidia effect. I
mean it reminds me of the Powell effect, right. So
we were on pins and needles, and still it's all, oh, God,
the Fed, the Fed, the Fed, the next meeting. Are
is the data going to support rates you know, going
(02:10):
up or rates going down or rates staying the same.
Now we had to deal with the Nvidia effect. God,
is in Nvidia going to continue? Yeah, it's triple digit
record quarters, triple digits. Think about that for a second.
Speaker 3 (02:27):
And if they.
Speaker 2 (02:28):
Don't deliver triple digit growth, then the whole market's going
to sell off. I mean that's what the pundits and
the prognosticators and the economists and the strategists and the
news anchors all over all the different things that we
watch and read, we're all like, oh god, if in Vidia,
if in Vidia misses and they guide you know, lower,
(02:50):
Oh yeah, buckle up. The market's crashing one stock.
Speaker 3 (02:55):
Well, this is how important you know, these handful of
stocks have become to the overall market. And we've been
talking about it. It's you know, the MAC seven and
then markets broadening out and saying, oh, there's a rotation
and small caps are doing better and so on and
so forth. But the reality is with the weight of
these companies that they have in the overall s and
P five hundred and the Nasdaq one hundred, and the
(03:17):
importance and the boost to some of these price hikes
and what the current stock prices are reflecting from this
AI revolution and what it can become, right, has inflated
a lot of this. So it's not overly you know,
I'm not overly surprised that it, but it you know,
(03:39):
how ridiculous is it that, yeah, one company has that
much influence on the other four hundred and ninety nine stocks.
The SMP five hundred.
Speaker 2 (03:49):
So if you're listening for the first time, let me
tell you what we're going to talk about. We always
try to after we get done ranting and raving, which
I primarily do. I barely will rant and worry for
a while about various things, mostly economic things, mostly government things,
mostly world order kind of things. But after we get
(04:10):
done ranting and talking, we're always try to talk about
strategy that is timely and that are things that if
you're not coming in for a meeting, if you're not
going to come to the seminar, that you should, we believe,
actually do yourself. So we'll be talking investment strategy, you know,
(04:31):
later in the show, and then we'll also end the
show with some investment ideas that we think are timely
and could help you as well. So, but first the.
Speaker 3 (04:45):
The well then Nvidio just to touch on that, ye
go a little bit more. Is the interesting thing as
important as it was as far as earnings, and everybody's
looking at the other thing is during you know, they
reported Wednesday aftern market close, but Wednesday in the morning,
what took a little bit of the market by surprise
(05:06):
was SMCI right was down over twenty percent.
Speaker 2 (05:10):
Twenty six. I think it hit at one point down
like the low point, right, yeah, like the low point.
Speaker 3 (05:15):
Yeah, and I think it closed down just under twenty percent. Yeah,
because I think the firm is hiddenberg. I want to say, yeah, yeah,
what's that shorted the stock?
Speaker 2 (05:27):
I know who you're talking about, but they shorted the stock,
the shortest stock.
Speaker 3 (05:30):
They were concerned about accounting practices and potential fraud and
what have you. The next day, SMCI reported that they're
going to delay their annual reporting and the stock just dropped. Yeah,
and they're they're big drive because they were at over
twelve hundred dollars in March this year.
Speaker 2 (05:48):
Yeah, twelve twenty nine was the high that they hit.
Speaker 3 (05:51):
And then during Wednesday they were in the low four hundreds. Oh,
it went all.
Speaker 2 (05:56):
It actually went down to four two, might have went
down to four hundred. That's a stock that I follow
personally and so and that's one that I keep playing
with with very advanced high risk strategies that we typically
do not do for our retired clients.
Speaker 3 (06:17):
But that was that was going on, and then people waiting,
you know, the investment community waiting on pins and needles
for video, and that stock was down a little bit
during that day, and then they didn't you know, they
didn't beat the overly high Wall Street estimates and you know,
expectations for a video, although they did I think it
(06:39):
was one hundred and twenty one percent.
Speaker 2 (06:40):
Yeah, that's that's what I'm saying. It's just preposterous. Well,
what was preposterous is that first, assuming that a company
will continue to grow its annual revenue at one hundred
and twenty percent, at some point they have to guide that, Hey,
guess what, we're probably not going to grow one hundred
and twenty twenty percent next year they grow fifty? Is
(07:03):
that bad? That's not growth anymore? Give me a royal break.
You know, double digit growth starts at ten percent. So
when you're at one hundred and twenty one and continue
to break records for quarterly profits quarter over quarter over quarter,
and you still have products and services in your pipeline
(07:23):
that could make your revenue even grow further from here
I e. Blackwell, then you know, does it warrant a
big sell off because you broke a record and you
guided that, hey, maybe next year's revenue depending on what
happens with the Blackwell chip and software so on and
(07:44):
so forth, maybe our revenue will still be ridiculously good,
but not as ridiculously ridiculously good. I mean, that's how
that's how stupid, that's how ridiculous this is. So this
is the ranting part.
Speaker 3 (07:59):
But volatility, if you look at the past two years,
during earnings, typically the volatility is like twelve percent, it
has a lot of the stock press has a lot
of movement. So after hours it was down seven or
eight percent, and then during market hours the following day,
you know, down four maybe five percent, so it wasn't
as big of a move as it typically had in
(08:20):
the past.
Speaker 2 (08:21):
I actually bought calls on Nvidia just because again whether
whether you have their phone number, I didn't call them.
I bought call options, which you know maybe in a
future show I've touched upon them here and there, but
that's not our investment ideas that are coming, and you
do want to listen, you know, for the investment ideas
(08:42):
that are extremely timely towards the end of the show.
But again, I bought some Nvidia calls because I do
believe that there is still you know, upside. Maybe in
the neighborhood a one one high one thirties, maybe it
gets back to its all time. I have one, you know,
(09:04):
split adjusted. But but but we'll see. You know, they're
relatively inexpensive to buy. Some calls out to h I
bought the November UH expiration and I bought one twenty five's,
so you know, out of the money, and I think
that's a pretty good bet. That's an investment idea. By
the way, that's an investment strategy.
Speaker 3 (09:24):
Said as an investment, you spilled the beans.
Speaker 2 (09:29):
But that's not a typical strategy in our retired client's portfolios. So,
but if you're interested in options, by the way, and
how those might play a role in your portfolio, especially
if you have, you know, a large stock position in
any stock for that matter, but but a well known,
highly liquid, highly traded stock, give us a call at
(09:50):
nine one six nine six seven thirty five hundred. So
you know, you couple the whole Nvidia thing with Now, okay,
we still have an FOMC meeting to talk about coming
and the whole what we believe what will happen. So
stay tuned. You're listening to the Wise Money Guys radio show.
(10:10):
I'm your co host John Scamberaner here with my partner
Giuseppe Ascani. We're certified portfolio managers. And if you're listening
to the show for the first time, or you've caught
it in the past but are just tuning in again
for maybe the second time, let me give you a
little bit of our background on why you should listening
to these couple of yay who's on the radio. Giuseppe
(10:31):
and I have been doing this a very long time.
I've been on the radio five years now, five years plus,
and quite frankly, I like to say we are battle tested,
not because of the radio show, but because of our experience.
My experience helping people in financial services goes back to
(10:53):
nineteen ninety two and Giuseppe's back. Giuseppe cut in in
two thousand and eight, right when things were you know,
time blank was hitting the fan, as they say, and
that's crucial. Education is super important, and I'm going to
talk about that real quick. But nothing is more important
(11:13):
than working with or getting your advice from, you know,
people like ourselves that have seen it all. Have we
seen good economies, yep. Have we seen bad economies, yep.
Have we seen high interest rates yep? Check low interest
rates yep. Check conflicts around the world yep.
Speaker 3 (11:33):
Check.
Speaker 2 (11:34):
No conflicts around the world, yep check. The reason why
I run through those things is because those all affect investments,
and knowing how to navigate those waters depending on what's
going on on a macro level and how that affects
you at a micro level is crucial. That's where the
almost combined fifty years of experience comes in. On top
(11:58):
of that, Jiuseppe and I don't consider ourselves financial advisors.
A financial advisor typically goes through a sales training at
a big, you know, brokerage firm, and they get taught
on you know, how to bring in, how to close clients,
how to you know, market, how to sell stuff. Jesseepianize
(12:20):
expertise is on how to create custom investment portfolios for
people's specific goals and objectives that get them to whatever
those numbers are in the most consistent way with the
least amount of risk. And that is what being a
certified portfolio manager is about. And that credential is very
(12:43):
difficult to get. It was We did it through Columbia University,
although we're not fans of what's going on at Columbia University.
If you've been watching the news, but it still doesn't
make from a from an institution perspective, where you got
that credential A very difficult one and one that we're
very proud of. The Other thing is beyond the almost
(13:06):
fifty years of experience is Giuseppe also holds a master's
in economics and finance as well as being a Chartered
retirement Planning counselor from the College for Financial Planning. So
we've got the alphabet soup, but more importantly, we have
the battle tested experiencing going back fifty years combined. So
(13:29):
that's who you're listening to. That's who you're getting this
information from. Now, the FOMC talk about giving one person
way too much power to move markets, to literally change
world economies.
Speaker 3 (13:45):
Now you imagine if in Nvidia just totally missed earnings
and Jerome Powell yeah, said we're not cutting rates.
Speaker 2 (13:54):
Yeah, I mean talk about a just a dagger in
the back to the market. Now, we don't think that's
going to happen. Let me tell you what I actually
think is going to happen. I think the FED is
backed into a corner because of the debt. You have
thirty five trillion dollars in debt and the debt payment
is now as much as the payments to the military
(14:16):
to run our entire military. It's as big as Social
Security or Medicare, and projected to get even bigger. The
FED at some point has to figure out how to
refinance the debt at a much lower term, a much
lower rate, for a much longer term, to get themselves
(14:37):
out of this corner. And it will start with lowering rates.
That is why I think the Fed will actually cut rates.
But they also know that there's no reason to cut
rates economically with the government stimulus and all the spending
still happening and projected to happening, happened to the tune
(14:58):
of fifty trillion dollars and then seventy eight trillion dollars
if you listen to that whack job Janet yelling. And
because of that, you can't cut rates too much because
if you pump even more liquidity into the into the economy,
then the government's already pumping. We will see inflation that
(15:18):
we don't go, oh, we haven't seen inflation like this.
Back to the set there will It will be a
new paradigm. It will be it will be like some
of the movies in the past where they said, oh,
can I get a cup of coffee? Yeah, that'll be
twenty four to fifty please. I mean we will see
inflation like has never been measured, if the FED pumps
(15:40):
too much money into the economy, if eases too much
here too soon. So my prediction is a quarter of
one percent rate cut on September.
Speaker 3 (15:53):
This year. Yeah, I think the September. Yes, and they've
kind of fulfilled it, checked a box and then just
let it out. Unless something materially changes in the markets or
the economic indicators where they have to jump in, I
think it might be one done.
Speaker 2 (16:11):
And again, this is where I believe the FED has
become political. And I know he spends all his time
talking about the data, the data, the data. But at
the same time, the FED knows that if they make
too big of a move one way or the other,
that affects the markets, that affects the economy, it affects
(16:32):
the election. And Janet Yellen and Jerome Powell, although he's
registered Republican, Janet Yellen's registered Democrat, are are pro you know,
liberal policies. And if you're pro liberal policies, and you
cannot speculate otherwise. Because Jerome Powell has never testified one
(16:56):
word that listen, I will never ever get inflation under
control and get prices under control until you freaking balance
the budget or reduce the debt. Not one word has
ever come out of his mouth to those sentiments. And
so the reality is is the prices that we're at now,
(17:19):
where they're up one hundred two hundred three hundred percent,
the prices are projected to still go higher. I love
that they go Oh, inflation has come down, That doesn't
mean prices have come down growth. The rate of increase
in prices, which are still increasing, has just slowed down
from an increasing perspective, but they're still increasing. So the
(17:41):
reality is that whatever you planned for you know, two
years ago, five years ago, ten years ago, especially if
you're retired you know that amount of time, or if
you don't have a plan, or you're about to retire,
all former paradigms, all former you know, statistical models, all
(18:07):
former assumptions are out the window. Let me give you
a simple example. Inflation from twenty ten to basically twenty
twenty two averaged one and a half percent price increases
every year. You can't use that one and a half
as an assumption and not run out of money when
(18:29):
inflation will probably remain where prices go up three to
ten percent every year for as far as the eye
can see. And if you project ten, you know, well,
then you know your your plan's going to fail. But
if you project one and a half, your plan is
also going to fail optimistic, So it's somewhere in the
(18:51):
three range in my opinion. Maybe maybe you can get
away with projecting inflation at two and a half or
high twos. But I think you're doing yourself a diskservice,
and I think you'll find yourself running out of money
in retirement if you don't properly plan for prices going
up higher than you know, two or three percent. Now,
(19:12):
what's the solution. It used to be that when you're retired,
you know, if you had no debts, you had a
million bucks, you had social Security and or a pension
coming in, you were going to be fine and you
could earn a one two three percent return and you're great.
Now the solution is you have to earn a much
(19:33):
higher rate of return than what you traditionally needed to
earn in retirement in order to not run out of money.
And next we're going to talk about the investment strategies
that are are are going to help you accomplish exactly
that you're listening to the wise money guys, John Scambering
(19:55):
to Seppivscani and we were certified portfolio managers out of
Grantite Bay, California that love helping people who are retired,
are about to retire manage their money. In fact, we
are having our last workshop for retirees for this year,
Bump Bump, Bump Bump on the last one, the last
one of the year, on October second, at the Old
Spaghetti Factory in Roseville on sunrise from six to seven
(20:19):
thirty pm. You are going to want to register early
if you're concerned at all about inflation or even worse
inflation coming, If you concerned it all about the outcome
of the election, concerned it all about the volatility of investments,
you know, the impact it's having on your on your
(20:39):
wealth or your income, so on and so forth, you're
going to want to come and give us a listen
on October second, because we're going to show you exactly
how we combat everything that's going on with our investment,
our custom investment portfolios, mainly for people who are tired,
(21:01):
so call nine one six nine sixty seven thirty five hundred.
Again that number is nine one six nine six seven
thirty five hundred. I hate to say it, but the
last few seminars we've had to turn people away because
they waited to the last minute. We had way more
registrations than we'd have seats and dinners to give, and
(21:22):
we had to turn people away. So call and call
early to get on that list. And please, if you
do call and register, please make sure you show up
because we might be turning somebody else away. And then
if you didn't show up, then we feel doubly is
(21:44):
that is that a word? Doubly doubly terrible for having
turned people away that could have come that we wouldn't register.
So again, call nine one six nine six seven thirty
five hundred. All right, So, as we said, you know
investment strategy more importantly, how you should be changing your
(22:05):
investment strategy right now is crucial. You know, based on
the fact that growth ruled the day, I mean growth
ruled the decade, Growth ruled the decade, there will always
be a place for growth stocks. Do I think in
Nvidia is a done deal? Do I think SMCI that
you mentioned is a done deal or any of the
(22:26):
mech No. But when you're retired, you can't absorb, you know,
the the really bad markets, the really bad you know
months or years for specific you know, growth stocks, if
you have those in your portfolio.
Speaker 3 (22:42):
Or counting on future growth, and then you have to
sell from that to then realize, you know a certain
amount of money that's going to provide you enough in
retirement versus putting money in value stocks or large companies
with cash flow that return it to their shareholders in
the way of dividends and provide a cash flow.
Speaker 2 (23:02):
Yeah, let me give you an example of a new
client we just got. I was blown away that with
their current advisor they had over one hundred mutual funds
in their portfolios and ETFs. You talk about no strategy whatsoever.
(23:23):
You talk about no diversification whatsoever. Position if you're if
you think because you have mutual funds or ETFs you're diversified,
were actually not diversified. And a couple of the investment
ideas we're going to give you in the next segment
are truly diversifying from stocks, So you'll definitely want to
(23:46):
keep listening. However, we're on the strategy portion, and the
strategy portion is it is absolutely time and has been
the absolute right time to move out of growth in
some profits increase your cash. But more importantly, if you
are staying in stocks because you have to, you know,
(24:09):
keep up with inflation, then large company, high quality, high
cash flow divid in paying stocks is where you want
your money to be. Not gross stocks that have already
gone up to multiples, that are overvalued potentially that pay
no dividend, even if their cash flow is great. There's
(24:32):
just too much risk to your livelihood, to your income,
to your wealth to remain at a high percentage of
just being in gross stocks or growth mutual funds or
growth ETFs. We are recommending, you know, not specifically to
somebody listening, but just in general, that if you're retired
(24:54):
and you've had in your portfolio's gone up you know,
pretty good in twenty three and per good in twenty four,
lock in some of that, get out of some of
those growth stocks and move to divi it in, you know,
value stocks, or dive it in large company stocks that
still have room to grow on price, but more importantly
(25:16):
have lots of free cash flow. If you have no
idea what types of companies. Those are you can look
to the energy sector or the utility sector and you
will definitely find you know, opportunities in those sectors. Also,
we talked about, you know, if the world is going
(25:37):
to electrify, how important metals and rare earth minerals will
be for an electrified America. And we talked about you
know and Alcoa, which is, you know, one of America's
great old metal companies. And then we also talked about
(25:59):
Freeport mcmaree, fc X, cos AA by the way, and
then uh and Freeport is more of a mining company.
They mine copper, but think about electricity. You need copper
for electricity and the conduction of electricity at least currently
with you know, current technology. And that's a whole different
(26:19):
type topic. And you can never go wrong by having
you know, gold, which is you know, the main metal
that all countries are trying to stockpile.
Speaker 3 (26:29):
Well, it's also good defense play when there's uncertainty in
the economy.
Speaker 2 (26:34):
Yes, and I again, you could buy physical gold, you
could buy gold tracking stock, or you can buy gold
mining companies. I like the gold mining etf gd X
that we we talked about, because there's some you know, uh,
you know, alternative and some more advanced income strategies that
you can do with gd X, which is the use
(26:56):
of call options and selling call options on gd X
to create an income at a very large potential return
on investment. And we'll talk about that in another show.
But again let's focus on the strategy. We're moving out
of growth stocks into either value stocks or value stocks
that pay a dividend, or large company growth stocks that
(27:18):
pay a dividend. I believe, and we've talked about them.
You can find you know, those types of investments in
the energy sector. But then more importantly, it's still good
time to roll out of stocks into bonds. Bond prices
have not you know, exploded yet. Bond yields are still
(27:39):
decent individual bonds, and that is still timely for now
until we potentially get rate cuts, or even if sentiment
believes that more rate cuts and further rate cuts are coming,
the market will reduce rates all by itself, and therefore
(28:01):
you will see prices on bonds go up. In the timing,
you know, to get risk off the table and get
into guaranteed you know, interest income, that timing is slipping away.
So let's talk about a couple of investments that we like.
So we already talked about the ones gd X from
(28:23):
the previous show. That was the previous show.
Speaker 3 (28:25):
Some of them are flat or a little bit of yep.
Speaker 2 (28:27):
Oh, and I should mention those these are not short
term you know picks. These these are long term.
Speaker 1 (28:34):
You know.
Speaker 2 (28:35):
Again, if if you believe that the world is going
to continue down this path of green energy and trying
to go all alike, even if it's not green.
Speaker 3 (28:44):
Energy AI by itself, and then cryptocurrency and miningning takes
a ton of power and consumption and they're not going
to go away. I mean, both both sides are adopting cryptocurrency,
and both sides have adopted and are going to continue
to move forward and supporting AI. So it doesn't matter
(29:05):
who wins. I think the the thing on top of
it is going to be electric vehicles, and that might
be a bit, you know, a big push from one
side or or not so much from the other side.
Speaker 2 (29:17):
And I'll give you a couple of natural gas ideas
that I wasn't planning on doing. But but again, you
can look at ET and EPD energy transfer and energy
energy product distributors, and those are both great natural gas
pipeline you know, transportation plays for the natural gas industry
that you know, pay great dividends. And you know, no
(29:41):
matter what the world is doing, the need and consumption
and growth of consumption for natural gas is not getting smaller,
it's getting bigger. So those are a couple of freebie
you know, uh investment ideas that are very timely. Prices
are pretty stable. Prices have gone up, you know, over
(30:05):
the last few years since I started talking about those,
but still the dividends are great. Anywhere from seven to
ten percent you'll find in dividends on those each year,
depending on the price you pay. The higher the price
you pay, you know, the lower the percentage the dividend
is overall. But still, if we're looking at inflation of three,
four or five, you know percent, and you're giving it
(30:26):
a dividend of seven, eight, nine, ten percent, those are
the types of strategies that we're talking about that should
be in your portfolio to help you tackle you know,
what's to come and.
Speaker 3 (30:36):
How how do these all fit potentially in your portfolio?
How much did you invest, how does it balance out
with you know, how much of these stocks versus bonds
based off of your goals, retirement goals. We don't know
the answer to that. That's where you're gonna have to
do your due dilisienonce or you can give us a call, yeah,
or attend the workshop. Yes, thank you very much. And
by the way, we are going to go to a break.
(30:57):
But when we come back, what I said we're going
to talk about, we're going to talk about which is
two very very good you know, timely truly investments, truly
in a way to diversify away from stocks and still
make money. So you're listening to the wise money guys,
John Scambray and I'm here with Giuseppe Vescani and I
(31:18):
hope you've enjoyed this show. We talked about a lot
of different things, but the most important thing we talked
about was joining us for our last workshop, our last
retiree free dinner educational event for the year at the
Old Spaghetti Factory on October second, which is a Wednesday,
and it's from six to seven thirty pm. And you'll
(31:39):
want to call nine one six nine six seven thirty
five hundred and do it right away because we have
to turn people away, which, as I said, we hate
to do that. But that's just the reality.
Speaker 2 (31:52):
There's only so much room, and once we have more
people registered than than we can hold in the room,
we have to start turning people away, which, as I said,
we hate to do. So at that workshop, by the way,
we're going to show you actual portfolios that our actual
clients have. We're going to show you more you know, models,
(32:17):
more stock picks, and how they have fared during all
this you know craziness, and we're going to show you
actual account performance without the client you know information, of course,
but at beginning the point of that is is we're
unlike anybody you've probably ever met with. In fact, I
(32:38):
typically show people how my family accounts are doing. Because
we put our money where our mouth is. We just
don't talk about this for the fun of it. This
is what we do for a living, to help people,
you know, make money and make money for a long
period of time. Most of our clients have been with
(33:00):
us for a very long period of time, and often
we're on the next generation. In the next generation because
what we do is so valuable to them, they don't leave. Unfortunately,
the way some of our clients leave is when they
pass on, and so you know, that's just a reality.
But come to the workshop on October second from six
(33:22):
to seven thirty pm if you're retired or you're about
to retire. Now, Spaghetti Factory food is good, but it's
not that good to where you'd becoming just for the food.
But you know, I like Spaghetti Factory good.
Speaker 3 (33:38):
I mean, so I like the chicken brommers on that's
what usually it, yep.
Speaker 2 (33:42):
And I really like the venue. Is why we continue
to do it as Spaghetti Factory because we have it
has a very large upstairs room that keeps you away
from you know, the downstairs where most of the noise
and everything is going on. And it's just a very
good centralized locationation, you know, for people that want to
(34:03):
come to get to from wherever they're at, whether it's
Sacramento or El Dorado Hills or of course if you're
in Roseville or folsome so on and so forth. It's
a very good location. Again, that's on October second from
six to seven thirty pm, and you'll want to call
nine one six nine six seven thirty five hundred. If
(34:24):
you can't make that date, just get on our calendar
for a no obligation consultational consultation and we'll show you
the same stuff that we would have showed you there
while getting to know you and reviewing you know what
it is you're doing and potentially concerned about, and showing
you how we can help you. So one more time
(34:46):
called nine one six nine six seven thirty five hundred. Okay,
let's talk about the couple of investments that again from
a strategy perspective of taking risk off the table, going
to investments that pay you either dividends or interest, you know,
reducing your exposure and truly diversifying away from stocks. The
(35:09):
first one we're gonna talk about is they're both ETFs, actually,
but the first one we're gonna talk about is t
L T Tom, Larry Tom, go ahead and talk a
little bit about that one, just eppy.
Speaker 3 (35:22):
TLT is an ETF. It is the twenty year Treasury
US bond. And the timeliness of it is because we're
in a high interest rate environment. Interest rates have come
down by way of market pushing them down, an anticipation
that the Feds are going to lower rates. Andrew and
Pell has now voice that the time has come so
(35:44):
much muchly anticipated. Next month he'll cut most likely a
quarter percent. How much more are they gonna cut you know,
for the remainder of the year going into next year.
Who knows that's all going to be now continue to
be data dependency. But if you look at the price
of TLT, it's hovering in the mid nineties upper nineties
(36:04):
right now, and it's gotten beaten down. So to give
some perspective, in the beginning of twenty twenty two, that
ATF was priced at about one hundred and fifty bucks.
And because interest rates have been rising, it you know,
kicks the price of bonds down, and so we've seen
it got down, it got down to the eighties. It's
come backed up because instraates have been coming down. So
one of two things if the Feds are going to
(36:28):
be successful in engineering a soft landing by way of
cutting rates throughout time as inflation gets down to their
target of two percent, and this thing is going to
continue to move up. If you look at where it
was earlier in twenty twenty three, after the speedy rate
hike process, in twenty twenty two, it was you know,
it topped about one hundred and ten percent, which is
about thirteen percent from where it's current prices right now,
(36:51):
which is a healthy game. It also pays a dividend
close to about four percent a year. So if a
recession is if the Feds break something like they have
more times than not and not have been successful in
engineering a self lending, then they're going to be forced
to really cut rates at a more rapid pace, which
(37:12):
is going to drive the price of bonds heltier and
higher at a higher pace. So, you know, one hundred
and fifty who knows, I mean, that's when interest rates
are at zero. I don't think it's going to get there.
Speaker 2 (37:25):
Yeah, but even if you got you know up you know,
ten percent, fifteen percent, that would still.
Speaker 3 (37:30):
While collecting it.
Speaker 2 (37:31):
And more importantly, it's the opposite of you know, stocks,
and it's reducing your exposure to stocks with still the
potential to make a stock like return and get paid
a decent rate of return, you know, somewhere around a
money market rate while you're waiting for that to potentially happen.
(37:52):
If it doesn't happen, we don't think you get hurt
because let's say, okay, that that you know, rates aren't
cut and because the economy doesn't slow, and then we
decide that okay, listen, it's better to get into something else.
There's not a lot of downside after already have coming
(38:12):
down so much over the last couple of years. So
that is why this is a very good, conservative, timely
pick for your investment portfolio. And always as money managers,
as professional portfolio managers, you don't want to overbuy. I
know it sounds fantastic, but you don't want to bet
(38:33):
the farm on it. You know, be prudent, you know,
put a little bit of your portfolio in that whatever's
comfortable for you. We like a five percent rule, but
it might be ten percent for you, whatever that number is.
Just don't bet the farm on it. Don't put twenty
five or fifty percent of your money in this one
position and so or one hundred percent because some people
(38:54):
will would do that. The next one is and again
very very timely. It has a lower correlation but more
importantly a lower beta to the S and P five
hundred to stocks because it's a credit product. It's a
private credit product versus you know, a stock portfolio. It
(39:17):
is also an ETF and it's vertice private credit and
the symbol is VPC. What I really like about this
particular one is it has a point sixty six beta
to the S and P five hundred, which means if
the SNP goes down you know, a dollar, it only
goes down sixty six cents. Conversely, if the SNP goes
(39:38):
up a dollar, it only goes up sixty six cents.
So it's less you know, volatile than the S and
P five hundred, which is a good thing. But here's
the best thing. At its current price at around twenty
two something, it was in the mid twenties. Last week,
it was paying a projected dividend of double digit it's
(40:00):
ten percent. So that is a stock like return for
a portfolio that isn't all stocks, and certainly not all
growth stocks. It is a stock like investment, but with
a lower beta than the S and P, which we
explain just means that if a dollar movement in the SNP,
(40:23):
it moves less than a dollar of the same movement
in the S and P.
Speaker 3 (40:27):
But the dividend and you've got a factor in if
you reinvest those dividends, it buffers a blow even more
as far as the up and down comparative to S
and P five.
Speaker 2 (40:36):
Hundred great points, so you have that choice. By the way,
so if you're managing your money yourself, and you're going
to do a trade, which hopefully you've had the experience
and you've done it before, and you're going to the
mutual fundbox. You know, from the drop down box in
most brokerage port accounts, you have stock, you know, you
have bond, you have option, you have mutual fun and
(41:00):
here you would be choosing stock and then from that stock,
once you put in the symbol of VPC, then you're
gonna have another box that says reinvest dividends and gains
or don't reinvest dividend gains if you want to use
the dividends as a hedge, as a buffer, as Gioseppe said,
(41:21):
choose reinvesting. So that just means when the stock price
goes down and dividends are paid or gains are paid,
it's gonna buy more shares at a lower price, if
you're not worried about that. I like to have and
especially if you take income from your retirement portfolio.
Speaker 3 (41:40):
I like to have.
Speaker 2 (41:41):
Dividends remitted and gains remitted to cash because then a
lot of our retired clients are getting a monthly check
or are taking there are mds because they have to.
They're over you know, seventy and a half, you know,
or they're now over seventy two, projected to then go
(42:01):
to seventy three, and so they have no choice.
Speaker 3 (42:04):
What you're talking about, I'm.
Speaker 2 (42:06):
Talking about required minimum distributions. But either way, look at TLT,
look at VPC, look at those metals and mining companies
that we told you about, Look at the uh, the
natural gas, the energy companies we told you about. The
one thing that all of these have in common is
these are things that the world will consume and have
(42:30):
to have, you know, uh, no matter what I guess,
technically you could say the world doesn't have to have
you know, treasury bonds, but quite frankly, the United States certainly, Yeah,
that's a safe you know, most countries actually exactly right,
they go by. If we default on that, the world
is bankrupt. So anyway, I hope you enjoyed the show
(42:53):
you were listening to, John Scambering, Juseppe Veskani again. Remember
called nine one six seven thirty five hundred to register
for our free Retiree Dinner workshop or to come in
for a new obligation consultation called nine one six nine
sixty seven thirty five hundred hope you enjoyed the show
and come back and give us a listen next week.
(43:13):
Have a great week, infefry wegnd
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 (00:18):
Welcome to the Wise Money Guys Radio Show. I'm your
co host John Scamber and I'm here with my partner
Giuseppe Vescani, and we are certified portfolio managers out of
Granite Bay, California that love helping people who are retired
are about to retire manage their money. If you like
this show and have a question or want to come
in for a no obligation consultation, or more importantly, register
(00:39):
for our last workshop of the year on October second,
from six to seven thirty pm, which is a Wednesday,
by the way, at the Old Spaghetti Factory. Give us
a call at nine one six ninety six seven thirty
five hundred. Let me tell you who should call. So
if you're retired and you're concerned about, you know, the
(01:01):
absolute out of control costs and how much things have
increased and sadly, and we'll be talking about this, how
much more things could potentially continue to increase. You should
attend if you're about to retire and you want to project,
you know, whether or not you'll be comfortable in retirement
(01:25):
with the things you've amassed and the wealth you've created,
and then maybe the potential pensions or social security that
you're you're projected to have. Come to the workshop. If
you can't make that date on October second, you know,
come in for a no obligation consultation again called nine
one six ninety six seven thirty five hundred. So just
(01:48):
have to be the first thing we got to talk
about as this whole in video and Vidia effect. I
mean it reminds me of the Powell effect, right. So
we were on pins and needles, and still it's all, oh, God,
the Fed, the Fed, the Fed, the next meeting. Are
is the data going to support rates you know, going
(02:10):
up or rates going down or rates staying the same.
Now we had to deal with the Nvidia effect. God,
is in Nvidia going to continue? Yeah, it's triple digit
record quarters, triple digits. Think about that for a second.
Speaker 3 (02:27):
And if they.
Speaker 2 (02:28):
Don't deliver triple digit growth, then the whole market's going
to sell off. I mean that's what the pundits and
the prognosticators and the economists and the strategists and the
news anchors all over all the different things that we
watch and read, we're all like, oh god, if in Vidia,
if in Vidia misses and they guide you know, lower,
(02:50):
Oh yeah, buckle up. The market's crashing one stock.
Speaker 3 (02:55):
Well, this is how important you know, these handful of
stocks have become to the overall market. And we've been
talking about it. It's you know, the MAC seven and
then markets broadening out and saying, oh, there's a rotation
and small caps are doing better and so on and
so forth. But the reality is with the weight of
these companies that they have in the overall s and
P five hundred and the Nasdaq one hundred, and the
(03:17):
importance and the boost to some of these price hikes
and what the current stock prices are reflecting from this
AI revolution and what it can become, right, has inflated
a lot of this. So it's not overly you know,
I'm not overly surprised that it, but it you know,
(03:39):
how ridiculous is it that, yeah, one company has that
much influence on the other four hundred and ninety nine stocks.
The SMP five hundred.
Speaker 2 (03:49):
So if you're listening for the first time, let me
tell you what we're going to talk about. We always
try to after we get done ranting and raving, which
I primarily do. I barely will rant and worry for
a while about various things, mostly economic things, mostly government things,
mostly world order kind of things. But after we get
(04:10):
done ranting and talking, we're always try to talk about
strategy that is timely and that are things that if
you're not coming in for a meeting, if you're not
going to come to the seminar, that you should, we believe,
actually do yourself. So we'll be talking investment strategy, you know,
(04:31):
later in the show, and then we'll also end the
show with some investment ideas that we think are timely
and could help you as well. So, but first the.
Speaker 3 (04:45):
The well then Nvidio just to touch on that, ye
go a little bit more. Is the interesting thing as
important as it was as far as earnings, and everybody's
looking at the other thing is during you know, they
reported Wednesday aftern market close, but Wednesday in the morning,
what took a little bit of the market by surprise
(05:06):
was SMCI right was down over twenty percent.
Speaker 2 (05:10):
Twenty six. I think it hit at one point down
like the low point, right, yeah, like the low point.
Speaker 3 (05:15):
Yeah, and I think it closed down just under twenty percent. Yeah,
because I think the firm is hiddenberg. I want to say, yeah, yeah,
what's that shorted the stock?
Speaker 2 (05:27):
I know who you're talking about, but they shorted the stock,
the shortest stock.
Speaker 3 (05:30):
They were concerned about accounting practices and potential fraud and
what have you. The next day, SMCI reported that they're
going to delay their annual reporting and the stock just dropped. Yeah,
and they're they're big drive because they were at over
twelve hundred dollars in March this year.
Speaker 2 (05:48):
Yeah, twelve twenty nine was the high that they hit.
Speaker 3 (05:51):
And then during Wednesday they were in the low four hundreds. Oh,
it went all.
Speaker 2 (05:56):
It actually went down to four two, might have went
down to four hundred. That's a stock that I follow
personally and so and that's one that I keep playing
with with very advanced high risk strategies that we typically
do not do for our retired clients.
Speaker 3 (06:17):
But that was that was going on, and then people waiting,
you know, the investment community waiting on pins and needles
for video, and that stock was down a little bit
during that day, and then they didn't you know, they
didn't beat the overly high Wall Street estimates and you know,
expectations for a video, although they did I think it
(06:39):
was one hundred and twenty one percent.
Speaker 2 (06:40):
Yeah, that's that's what I'm saying. It's just preposterous. Well,
what was preposterous is that first, assuming that a company
will continue to grow its annual revenue at one hundred
and twenty percent, at some point they have to guide that, Hey,
guess what, we're probably not going to grow one hundred
and twenty twenty percent next year they grow fifty? Is
(07:03):
that bad? That's not growth anymore? Give me a royal break.
You know, double digit growth starts at ten percent. So
when you're at one hundred and twenty one and continue
to break records for quarterly profits quarter over quarter over quarter,
and you still have products and services in your pipeline
(07:23):
that could make your revenue even grow further from here
I e. Blackwell, then you know, does it warrant a
big sell off because you broke a record and you
guided that, hey, maybe next year's revenue depending on what
happens with the Blackwell chip and software so on and
(07:44):
so forth, maybe our revenue will still be ridiculously good,
but not as ridiculously ridiculously good. I mean, that's how
that's how stupid, that's how ridiculous this is. So this
is the ranting part.
Speaker 3 (07:59):
But volatility, if you look at the past two years,
during earnings, typically the volatility is like twelve percent, it
has a lot of the stock press has a lot
of movement. So after hours it was down seven or
eight percent, and then during market hours the following day,
you know, down four maybe five percent, so it wasn't
as big of a move as it typically had in
(08:20):
the past.
Speaker 2 (08:21):
I actually bought calls on Nvidia just because again whether
whether you have their phone number, I didn't call them.
I bought call options, which you know maybe in a
future show I've touched upon them here and there, but
that's not our investment ideas that are coming, and you
do want to listen, you know, for the investment ideas
(08:42):
that are extremely timely towards the end of the show.
But again, I bought some Nvidia calls because I do
believe that there is still you know, upside. Maybe in
the neighborhood a one one high one thirties, maybe it
gets back to its all time. I have one, you know,
(09:04):
split adjusted. But but but we'll see. You know, they're
relatively inexpensive to buy. Some calls out to h I
bought the November UH expiration and I bought one twenty five's,
so you know, out of the money, and I think
that's a pretty good bet. That's an investment idea. By
the way, that's an investment strategy.
Speaker 3 (09:24):
Said as an investment, you spilled the beans.
Speaker 2 (09:29):
But that's not a typical strategy in our retired client's portfolios. So,
but if you're interested in options, by the way, and
how those might play a role in your portfolio, especially
if you have, you know, a large stock position in
any stock for that matter, but but a well known,
highly liquid, highly traded stock, give us a call at
(09:50):
nine one six nine six seven thirty five hundred. So
you know, you couple the whole Nvidia thing with Now, okay,
we still have an FOMC meeting to talk about coming
and the whole what we believe what will happen. So
stay tuned. You're listening to the Wise Money Guys radio show.
(10:10):
I'm your co host John Scamberaner here with my partner
Giuseppe Ascani. We're certified portfolio managers. And if you're listening
to the show for the first time, or you've caught
it in the past but are just tuning in again
for maybe the second time, let me give you a
little bit of our background on why you should listening
to these couple of yay who's on the radio. Giuseppe
(10:31):
and I have been doing this a very long time.
I've been on the radio five years now, five years plus,
and quite frankly, I like to say we are battle tested,
not because of the radio show, but because of our experience.
My experience helping people in financial services goes back to
(10:53):
nineteen ninety two and Giuseppe's back. Giuseppe cut in in
two thousand and eight, right when things were you know,
time blank was hitting the fan, as they say, and
that's crucial. Education is super important, and I'm going to
talk about that real quick. But nothing is more important
(11:13):
than working with or getting your advice from, you know,
people like ourselves that have seen it all. Have we
seen good economies, yep. Have we seen bad economies, yep.
Have we seen high interest rates yep? Check low interest
rates yep. Check conflicts around the world yep.
Speaker 3 (11:33):
Check.
Speaker 2 (11:34):
No conflicts around the world, yep check. The reason why
I run through those things is because those all affect investments,
and knowing how to navigate those waters depending on what's
going on on a macro level and how that affects
you at a micro level is crucial. That's where the
almost combined fifty years of experience comes in. On top
(11:58):
of that, Jiuseppe and I don't consider ourselves financial advisors.
A financial advisor typically goes through a sales training at
a big, you know, brokerage firm, and they get taught
on you know, how to bring in, how to close clients,
how to you know, market, how to sell stuff. Jesseepianize
(12:20):
expertise is on how to create custom investment portfolios for
people's specific goals and objectives that get them to whatever
those numbers are in the most consistent way with the
least amount of risk. And that is what being a
certified portfolio manager is about. And that credential is very
(12:43):
difficult to get. It was We did it through Columbia University,
although we're not fans of what's going on at Columbia University.
If you've been watching the news, but it still doesn't
make from a from an institution perspective, where you got
that credential A very difficult one and one that we're
very proud of. The Other thing is beyond the almost
(13:06):
fifty years of experience is Giuseppe also holds a master's
in economics and finance as well as being a Chartered
retirement Planning counselor from the College for Financial Planning. So
we've got the alphabet soup, but more importantly, we have
the battle tested experiencing going back fifty years combined. So
(13:29):
that's who you're listening to. That's who you're getting this
information from. Now, the FOMC talk about giving one person
way too much power to move markets, to literally change
world economies.
Speaker 3 (13:45):
Now you imagine if in Nvidia just totally missed earnings
and Jerome Powell yeah, said we're not cutting rates.
Speaker 2 (13:54):
Yeah, I mean talk about a just a dagger in
the back to the market. Now, we don't think that's
going to happen. Let me tell you what I actually
think is going to happen. I think the FED is
backed into a corner because of the debt. You have
thirty five trillion dollars in debt and the debt payment
is now as much as the payments to the military
(14:16):
to run our entire military. It's as big as Social
Security or Medicare, and projected to get even bigger. The
FED at some point has to figure out how to
refinance the debt at a much lower term, a much
lower rate, for a much longer term, to get themselves
(14:37):
out of this corner. And it will start with lowering rates.
That is why I think the Fed will actually cut rates.
But they also know that there's no reason to cut
rates economically with the government stimulus and all the spending
still happening and projected to happening, happened to the tune
(14:58):
of fifty trillion dollars and then seventy eight trillion dollars
if you listen to that whack job Janet yelling. And
because of that, you can't cut rates too much because
if you pump even more liquidity into the into the economy,
then the government's already pumping. We will see inflation that
(15:18):
we don't go, oh, we haven't seen inflation like this.
Back to the set there will It will be a
new paradigm. It will be it will be like some
of the movies in the past where they said, oh,
can I get a cup of coffee? Yeah, that'll be
twenty four to fifty please. I mean we will see
inflation like has never been measured, if the FED pumps
(15:40):
too much money into the economy, if eases too much
here too soon. So my prediction is a quarter of
one percent rate cut on September.
Speaker 3 (15:53):
This year. Yeah, I think the September. Yes, and they've
kind of fulfilled it, checked a box and then just
let it out. Unless something materially changes in the markets or
the economic indicators where they have to jump in, I
think it might be one done.
Speaker 2 (16:11):
And again, this is where I believe the FED has
become political. And I know he spends all his time
talking about the data, the data, the data. But at
the same time, the FED knows that if they make
too big of a move one way or the other,
that affects the markets, that affects the economy, it affects
(16:32):
the election. And Janet Yellen and Jerome Powell, although he's
registered Republican, Janet Yellen's registered Democrat, are are pro you know,
liberal policies. And if you're pro liberal policies, and you
cannot speculate otherwise. Because Jerome Powell has never testified one
(16:56):
word that listen, I will never ever get inflation under
control and get prices under control until you freaking balance
the budget or reduce the debt. Not one word has
ever come out of his mouth to those sentiments. And
so the reality is is the prices that we're at now,
(17:19):
where they're up one hundred two hundred three hundred percent,
the prices are projected to still go higher. I love
that they go Oh, inflation has come down, That doesn't
mean prices have come down growth. The rate of increase
in prices, which are still increasing, has just slowed down
from an increasing perspective, but they're still increasing. So the
(17:41):
reality is that whatever you planned for you know, two
years ago, five years ago, ten years ago, especially if
you're retired you know that amount of time, or if
you don't have a plan, or you're about to retire,
all former paradigms, all former you know, statistical models, all
(18:07):
former assumptions are out the window. Let me give you
a simple example. Inflation from twenty ten to basically twenty
twenty two averaged one and a half percent price increases
every year. You can't use that one and a half
as an assumption and not run out of money when
(18:29):
inflation will probably remain where prices go up three to
ten percent every year for as far as the eye
can see. And if you project ten, you know, well,
then you know your your plan's going to fail. But
if you project one and a half, your plan is
also going to fail optimistic, So it's somewhere in the
(18:51):
three range in my opinion. Maybe maybe you can get
away with projecting inflation at two and a half or
high twos. But I think you're doing yourself a diskservice,
and I think you'll find yourself running out of money
in retirement if you don't properly plan for prices going
up higher than you know, two or three percent. Now,
(19:12):
what's the solution. It used to be that when you're retired,
you know, if you had no debts, you had a
million bucks, you had social Security and or a pension
coming in, you were going to be fine and you
could earn a one two three percent return and you're great.
Now the solution is you have to earn a much
(19:33):
higher rate of return than what you traditionally needed to
earn in retirement in order to not run out of money.
And next we're going to talk about the investment strategies
that are are are going to help you accomplish exactly
that you're listening to the wise money guys, John Scambering
(19:55):
to Seppivscani and we were certified portfolio managers out of
Grantite Bay, California that love helping people who are retired,
are about to retire manage their money. In fact, we
are having our last workshop for retirees for this year,
Bump Bump, Bump Bump on the last one, the last
one of the year, on October second, at the Old
Spaghetti Factory in Roseville on sunrise from six to seven
(20:19):
thirty pm. You are going to want to register early
if you're concerned at all about inflation or even worse
inflation coming, If you concerned it all about the outcome
of the election, concerned it all about the volatility of investments,
you know, the impact it's having on your on your
(20:39):
wealth or your income, so on and so forth, you're
going to want to come and give us a listen
on October second, because we're going to show you exactly
how we combat everything that's going on with our investment,
our custom investment portfolios, mainly for people who are tired,
(21:01):
so call nine one six nine sixty seven thirty five hundred.
Again that number is nine one six nine six seven
thirty five hundred. I hate to say it, but the
last few seminars we've had to turn people away because
they waited to the last minute. We had way more
registrations than we'd have seats and dinners to give, and
(21:22):
we had to turn people away. So call and call
early to get on that list. And please, if you
do call and register, please make sure you show up
because we might be turning somebody else away. And then
if you didn't show up, then we feel doubly is
(21:44):
that is that a word? Doubly doubly terrible for having
turned people away that could have come that we wouldn't register.
So again, call nine one six nine six seven thirty
five hundred. All right, So, as we said, you know
investment strategy more importantly, how you should be changing your
(22:05):
investment strategy right now is crucial. You know, based on
the fact that growth ruled the day, I mean growth
ruled the decade, Growth ruled the decade, there will always
be a place for growth stocks. Do I think in
Nvidia is a done deal? Do I think SMCI that
you mentioned is a done deal or any of the
(22:26):
mech No. But when you're retired, you can't absorb, you know,
the the really bad markets, the really bad you know
months or years for specific you know, growth stocks, if
you have those in your portfolio.
Speaker 3 (22:42):
Or counting on future growth, and then you have to
sell from that to then realize, you know a certain
amount of money that's going to provide you enough in
retirement versus putting money in value stocks or large companies
with cash flow that return it to their shareholders in
the way of dividends and provide a cash flow.
Speaker 2 (23:02):
Yeah, let me give you an example of a new
client we just got. I was blown away that with
their current advisor they had over one hundred mutual funds
in their portfolios and ETFs. You talk about no strategy whatsoever.
(23:23):
You talk about no diversification whatsoever. Position if you're if
you think because you have mutual funds or ETFs you're diversified,
were actually not diversified. And a couple of the investment
ideas we're going to give you in the next segment
are truly diversifying from stocks, So you'll definitely want to
(23:46):
keep listening. However, we're on the strategy portion, and the
strategy portion is it is absolutely time and has been
the absolute right time to move out of growth in
some profits increase your cash. But more importantly, if you
are staying in stocks because you have to, you know,
(24:09):
keep up with inflation, then large company, high quality, high
cash flow divid in paying stocks is where you want
your money to be. Not gross stocks that have already
gone up to multiples, that are overvalued potentially that pay
no dividend, even if their cash flow is great. There's
(24:32):
just too much risk to your livelihood, to your income,
to your wealth to remain at a high percentage of
just being in gross stocks or growth mutual funds or
growth ETFs. We are recommending, you know, not specifically to
somebody listening, but just in general, that if you're retired
(24:54):
and you've had in your portfolio's gone up you know,
pretty good in twenty three and per good in twenty four,
lock in some of that, get out of some of
those growth stocks and move to divi it in, you know,
value stocks, or dive it in large company stocks that
still have room to grow on price, but more importantly
(25:16):
have lots of free cash flow. If you have no
idea what types of companies. Those are you can look
to the energy sector or the utility sector and you
will definitely find you know, opportunities in those sectors. Also,
we talked about, you know, if the world is going
(25:37):
to electrify, how important metals and rare earth minerals will
be for an electrified America. And we talked about you
know and Alcoa, which is, you know, one of America's
great old metal companies. And then we also talked about
(25:59):
Freeport mcmaree, fc X, cos AA by the way, and
then uh and Freeport is more of a mining company.
They mine copper, but think about electricity. You need copper
for electricity and the conduction of electricity at least currently
with you know, current technology. And that's a whole different
(26:19):
type topic. And you can never go wrong by having
you know, gold, which is you know, the main metal
that all countries are trying to stockpile.
Speaker 3 (26:29):
Well, it's also good defense play when there's uncertainty in
the economy.
Speaker 2 (26:34):
Yes, and I again, you could buy physical gold, you
could buy gold tracking stock, or you can buy gold
mining companies. I like the gold mining etf gd X
that we we talked about, because there's some you know, uh,
you know, alternative and some more advanced income strategies that
you can do with gd X, which is the use
(26:56):
of call options and selling call options on gd X
to create an income at a very large potential return
on investment. And we'll talk about that in another show.
But again let's focus on the strategy. We're moving out
of growth stocks into either value stocks or value stocks
that pay a dividend, or large company growth stocks that
(27:18):
pay a dividend. I believe, and we've talked about them.
You can find you know, those types of investments in
the energy sector. But then more importantly, it's still good
time to roll out of stocks into bonds. Bond prices
have not you know, exploded yet. Bond yields are still
(27:39):
decent individual bonds, and that is still timely for now
until we potentially get rate cuts, or even if sentiment
believes that more rate cuts and further rate cuts are coming,
the market will reduce rates all by itself, and therefore
(28:01):
you will see prices on bonds go up. In the timing,
you know, to get risk off the table and get
into guaranteed you know, interest income, that timing is slipping away.
So let's talk about a couple of investments that we like.
So we already talked about the ones gd X from
(28:23):
the previous show. That was the previous show.
Speaker 3 (28:25):
Some of them are flat or a little bit of yep.
Speaker 2 (28:27):
Oh, and I should mention those these are not short
term you know picks. These these are long term.
Speaker 1 (28:34):
You know.
Speaker 2 (28:35):
Again, if if you believe that the world is going
to continue down this path of green energy and trying
to go all alike, even if it's not green.
Speaker 3 (28:44):
Energy AI by itself, and then cryptocurrency and miningning takes
a ton of power and consumption and they're not going
to go away. I mean, both both sides are adopting cryptocurrency,
and both sides have adopted and are going to continue
to move forward and supporting AI. So it doesn't matter
(29:05):
who wins. I think the the thing on top of
it is going to be electric vehicles, and that might
be a bit, you know, a big push from one
side or or not so much from the other side.
Speaker 2 (29:17):
And I'll give you a couple of natural gas ideas
that I wasn't planning on doing. But but again, you
can look at ET and EPD energy transfer and energy
energy product distributors, and those are both great natural gas
pipeline you know, transportation plays for the natural gas industry
that you know, pay great dividends. And you know, no
(29:41):
matter what the world is doing, the need and consumption
and growth of consumption for natural gas is not getting smaller,
it's getting bigger. So those are a couple of freebie
you know, uh investment ideas that are very timely. Prices
are pretty stable. Prices have gone up, you know, over
(30:05):
the last few years since I started talking about those,
but still the dividends are great. Anywhere from seven to
ten percent you'll find in dividends on those each year,
depending on the price you pay. The higher the price
you pay, you know, the lower the percentage the dividend
is overall. But still, if we're looking at inflation of three,
four or five, you know percent, and you're giving it
(30:26):
a dividend of seven, eight, nine, ten percent, those are
the types of strategies that we're talking about that should
be in your portfolio to help you tackle you know,
what's to come and.
Speaker 3 (30:36):
How how do these all fit potentially in your portfolio?
How much did you invest, how does it balance out
with you know, how much of these stocks versus bonds
based off of your goals, retirement goals. We don't know
the answer to that. That's where you're gonna have to
do your due dilisienonce or you can give us a call, yeah,
or attend the workshop. Yes, thank you very much. And
by the way, we are going to go to a break.
(30:57):
But when we come back, what I said we're going
to talk about, we're going to talk about which is
two very very good you know, timely truly investments, truly
in a way to diversify away from stocks and still
make money. So you're listening to the wise money guys,
John Scambray and I'm here with Giuseppe Vescani and I
(31:18):
hope you've enjoyed this show. We talked about a lot
of different things, but the most important thing we talked
about was joining us for our last workshop, our last
retiree free dinner educational event for the year at the
Old Spaghetti Factory on October second, which is a Wednesday,
and it's from six to seven thirty pm. And you'll
(31:39):
want to call nine one six nine six seven thirty
five hundred and do it right away because we have
to turn people away, which, as I said, we hate
to do that. But that's just the reality.
Speaker 2 (31:52):
There's only so much room, and once we have more
people registered than than we can hold in the room,
we have to start turning people away, which, as I said,
we hate to do. So at that workshop, by the way,
we're going to show you actual portfolios that our actual
clients have. We're going to show you more you know, models,
(32:17):
more stock picks, and how they have fared during all
this you know craziness, and we're going to show you
actual account performance without the client you know information, of course,
but at beginning the point of that is is we're
unlike anybody you've probably ever met with. In fact, I
(32:38):
typically show people how my family accounts are doing. Because
we put our money where our mouth is. We just
don't talk about this for the fun of it. This
is what we do for a living, to help people,
you know, make money and make money for a long
period of time. Most of our clients have been with
(33:00):
us for a very long period of time, and often
we're on the next generation. In the next generation because
what we do is so valuable to them, they don't leave. Unfortunately,
the way some of our clients leave is when they
pass on, and so you know, that's just a reality.
But come to the workshop on October second from six
(33:22):
to seven thirty pm if you're retired or you're about
to retire. Now, Spaghetti Factory food is good, but it's
not that good to where you'd becoming just for the food.
But you know, I like Spaghetti Factory good.
Speaker 3 (33:38):
I mean, so I like the chicken brommers on that's
what usually it, yep.
Speaker 2 (33:42):
And I really like the venue. Is why we continue
to do it as Spaghetti Factory because we have it
has a very large upstairs room that keeps you away
from you know, the downstairs where most of the noise
and everything is going on. And it's just a very
good centralized locationation, you know, for people that want to
(34:03):
come to get to from wherever they're at, whether it's
Sacramento or El Dorado Hills or of course if you're
in Roseville or folsome so on and so forth. It's
a very good location. Again, that's on October second from
six to seven thirty pm, and you'll want to call
nine one six nine six seven thirty five hundred. If
(34:24):
you can't make that date, just get on our calendar
for a no obligation consultational consultation and we'll show you
the same stuff that we would have showed you there
while getting to know you and reviewing you know what
it is you're doing and potentially concerned about, and showing
you how we can help you. So one more time
(34:46):
called nine one six nine six seven thirty five hundred. Okay,
let's talk about the couple of investments that again from
a strategy perspective of taking risk off the table, going
to investments that pay you either dividends or interest, you know,
reducing your exposure and truly diversifying away from stocks. The
(35:09):
first one we're gonna talk about is they're both ETFs, actually,
but the first one we're gonna talk about is t
L T Tom, Larry Tom, go ahead and talk a
little bit about that one, just eppy.
Speaker 3 (35:22):
TLT is an ETF. It is the twenty year Treasury
US bond. And the timeliness of it is because we're
in a high interest rate environment. Interest rates have come
down by way of market pushing them down, an anticipation
that the Feds are going to lower rates. Andrew and
Pell has now voice that the time has come so
(35:44):
much muchly anticipated. Next month he'll cut most likely a
quarter percent. How much more are they gonna cut you know,
for the remainder of the year going into next year.
Who knows that's all going to be now continue to
be data dependency. But if you look at the price
of TLT, it's hovering in the mid nineties upper nineties
(36:04):
right now, and it's gotten beaten down. So to give
some perspective, in the beginning of twenty twenty two, that
ATF was priced at about one hundred and fifty bucks.
And because interest rates have been rising, it you know,
kicks the price of bonds down, and so we've seen
it got down, it got down to the eighties. It's
come backed up because instraates have been coming down. So
one of two things if the Feds are going to
(36:28):
be successful in engineering a soft landing by way of
cutting rates throughout time as inflation gets down to their
target of two percent, and this thing is going to
continue to move up. If you look at where it
was earlier in twenty twenty three, after the speedy rate
hike process, in twenty twenty two, it was you know,
it topped about one hundred and ten percent, which is
about thirteen percent from where it's current prices right now,
(36:51):
which is a healthy game. It also pays a dividend
close to about four percent a year. So if a
recession is if the Feds break something like they have
more times than not and not have been successful in
engineering a self lending, then they're going to be forced
to really cut rates at a more rapid pace, which
(37:12):
is going to drive the price of bonds heltier and
higher at a higher pace. So, you know, one hundred
and fifty who knows, I mean, that's when interest rates
are at zero. I don't think it's going to get there.
Speaker 2 (37:25):
Yeah, but even if you got you know up you know,
ten percent, fifteen percent, that would still.
Speaker 3 (37:30):
While collecting it.
Speaker 2 (37:31):
And more importantly, it's the opposite of you know, stocks,
and it's reducing your exposure to stocks with still the
potential to make a stock like return and get paid
a decent rate of return, you know, somewhere around a
money market rate while you're waiting for that to potentially happen.
(37:52):
If it doesn't happen, we don't think you get hurt
because let's say, okay, that that you know, rates aren't
cut and because the economy doesn't slow, and then we
decide that okay, listen, it's better to get into something else.
There's not a lot of downside after already have coming
(38:12):
down so much over the last couple of years. So
that is why this is a very good, conservative, timely
pick for your investment portfolio. And always as money managers,
as professional portfolio managers, you don't want to overbuy. I
know it sounds fantastic, but you don't want to bet
(38:33):
the farm on it. You know, be prudent, you know,
put a little bit of your portfolio in that whatever's
comfortable for you. We like a five percent rule, but
it might be ten percent for you, whatever that number is.
Just don't bet the farm on it. Don't put twenty
five or fifty percent of your money in this one
position and so or one hundred percent because some people
(38:54):
will would do that. The next one is and again
very very timely. It has a lower correlation but more
importantly a lower beta to the S and P five
hundred to stocks because it's a credit product. It's a
private credit product versus you know, a stock portfolio. It
(39:17):
is also an ETF and it's vertice private credit and
the symbol is VPC. What I really like about this
particular one is it has a point sixty six beta
to the S and P five hundred, which means if
the SNP goes down you know, a dollar, it only
goes down sixty six cents. Conversely, if the SNP goes
(39:38):
up a dollar, it only goes up sixty six cents.
So it's less you know, volatile than the S and
P five hundred, which is a good thing. But here's
the best thing. At its current price at around twenty
two something, it was in the mid twenties. Last week,
it was paying a projected dividend of double digit it's
(40:00):
ten percent. So that is a stock like return for
a portfolio that isn't all stocks, and certainly not all
growth stocks. It is a stock like investment, but with
a lower beta than the S and P, which we
explain just means that if a dollar movement in the SNP,
(40:23):
it moves less than a dollar of the same movement
in the S and P.
Speaker 3 (40:27):
But the dividend and you've got a factor in if
you reinvest those dividends, it buffers a blow even more
as far as the up and down comparative to S
and P five.
Speaker 2 (40:36):
Hundred great points, so you have that choice. By the way,
so if you're managing your money yourself, and you're going
to do a trade, which hopefully you've had the experience
and you've done it before, and you're going to the
mutual fundbox. You know, from the drop down box in
most brokerage port accounts, you have stock, you know, you
have bond, you have option, you have mutual fun and
(41:00):
here you would be choosing stock and then from that stock,
once you put in the symbol of VPC, then you're
gonna have another box that says reinvest dividends and gains
or don't reinvest dividend gains if you want to use
the dividends as a hedge, as a buffer, as Gioseppe said,
(41:21):
choose reinvesting. So that just means when the stock price
goes down and dividends are paid or gains are paid,
it's gonna buy more shares at a lower price, if
you're not worried about that. I like to have and
especially if you take income from your retirement portfolio.
Speaker 3 (41:40):
I like to have.
Speaker 2 (41:41):
Dividends remitted and gains remitted to cash because then a
lot of our retired clients are getting a monthly check
or are taking there are mds because they have to.
They're over you know, seventy and a half, you know,
or they're now over seventy two, projected to then go
(42:01):
to seventy three, and so they have no choice.
Speaker 3 (42:04):
What you're talking about, I'm.
Speaker 2 (42:06):
Talking about required minimum distributions. But either way, look at TLT,
look at VPC, look at those metals and mining companies
that we told you about, Look at the uh, the
natural gas, the energy companies we told you about. The
one thing that all of these have in common is
these are things that the world will consume and have
(42:30):
to have, you know, uh, no matter what I guess,
technically you could say the world doesn't have to have
you know, treasury bonds, but quite frankly, the United States certainly, Yeah,
that's a safe you know, most countries actually exactly right,
they go by. If we default on that, the world
is bankrupt. So anyway, I hope you enjoyed the show
(42:53):
you were listening to, John Scambering, Juseppe Veskani again. Remember
called nine one six seven thirty five hundred to register
for our free Retiree Dinner workshop or to come in
for a new obligation consultation called nine one six nine
sixty seven thirty five hundred hope you enjoyed the show
and come back and give us a listen next week.
(43:13):
Have a great week, infefry wegnd
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