July 25, 2024 • 43 mins
With the tech stocks reporting their earnings this week, we are watching the market jitter. Host John and Giuseppe tell us how Government Influence is affecting the Stock Market and Small Cap companies. The Wise Money Guys.
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Speaker 1 (00:00):
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Speaker 2 (00:16):
Hello and welcome to the Wise Money Guys radio Show.
I'm your co host John Scambray and I'm here with
my partner Sevin Visconsin and we are certified portfolio managers
out of Granite Bay, California, for One Source Wealth Management
that specialize in helping people who are retired are about
to retire, manage their money and do their financial plans.
So if you like our show called nine one six
(00:40):
nine six seven thirty five hundred, leave us a message
and Kathy, we'll get back to you, or if it's
just a question, we'll get back to you during the week.
But again called nine one six nine six seven thirty
five hundred. I think we need to label this show.
I told you so right, because it's part well so many.
(01:03):
But the reality is is that we I have been saying,
you know that there would be a selloff at some point.
Was whether it was three percent, five percent, you know,
at some point during every bowl market there is an
interim typical correction. Yeah, I don't know if last week
(01:26):
was the start of that correction. It just depends on,
you know, what the catalysts are.
Speaker 3 (01:34):
Now.
Speaker 2 (01:34):
The early catalysts last week were some of the earnings
that came out.
Speaker 4 (01:40):
Actually started not last week but the week before with
the rhetoric between Biden and Trump and the pressure on
chip stocks in China.
Speaker 2 (01:48):
You bet, And so that was one catalyst. Then we
went into the following week last week, which was you know,
Google and Tesla talking about what the money they were
spending and you know, the pressure for Tesla on ev profitability.
For Google, it was you know, hey, we beat revenue,
(02:08):
we beat earnings. However, we're spending billions on AI and
we don't know exactly, you know, how much money, how
much return on investment will come from you know, these
expenditures that were that we're making. And and again we
could have you know, other things. So this next week
we have you know, Amazon, Microsoft, and Facebook meta reporting
(02:32):
and if if those three do well, because again because
of the waiting that they have on the end to
c the S and P five hundred or the Nasdaq
one hundred. You know, you could see a significant move
back up or continuing down. You could see that continuing
correction down. And we've been calling for a correction down.
(02:57):
Now you could already say that we were right, and
it came and it went. However, there are still a
lot in these these certain areas of the market that
may be over bought and overpriced. There is other areas
that that Giuseppe and I like, you know, that that
(03:18):
aren't overbought. They didn't go up, you know, the thirty
percent that the chip stocks went up or the AI
stocks went up, you know, this year, so they don't
have the room to sell off. We I still continue
to love the energy sector and I love you know,
(03:38):
big dividend pain stocks that have the the the profits
to turn around and share them with shareholders. You know,
that's that's a crucial way to increase your total your
potential total return at the same time, you know, lowering
your overall volatility. So that is going to be in
(04:04):
my estimation, the rest of what we is what will
continue to experience for the rest of the year, especially
you know, as who knows what other surprises are going
to come on the political front, on the election front.
You know, we went from the just most assistency I've
(04:25):
seen in my voting lifetime, which was the assassination attempt
that turns out, you know, wasn't maybe I mean, without
going down too many conspiracy theories, but all these miss
this mishaps by our agencies, you can't help but to
think was it on purpose? You know, that's a story
(04:48):
for a different time. But again, however it happened, that
was one massive event that kind of spooked the markets.
And you see things get rattled and go up and down,
and you see that move from risk you know on
to risk off and then and then you see the
president disappear for a while, and and and then announced
(05:12):
that he's not running for reelection. And then the d
n C anoint Kamala Harris the VP bypassing the primary.
On top of that, this is something that isn't widely reported,
but you know, testing the resolve of the US and
(05:33):
pushing the boundaries. You see you know, long range Chinese bombers, uh,
you know, off the coast of Alaska paired up and
partnered with Russian fighter jets. Now is that a coincidence
with the president?
Speaker 3 (05:50):
What movies is I didn't watch that movie.
Speaker 2 (05:53):
I mean literally, it's just that's what sounds.
Speaker 3 (05:56):
It sounds like a Netflix SERI is.
Speaker 2 (05:58):
Like a movie. But the reality is is that these
are very scary times. You take open borders, you take
you had we had the nuclear subs of Russia off
of Cuba. Now you have Chinese bombers off of Alaska.
And you've got an incompetent, infirm mentally you know, incapacitated
(06:23):
president who you know won't won't stand down. Doesn't mean
that Kamala would be any better. And then you've got
the media completely lying to Americans and saying this was
literally on some of the other opposing shows that I watch.
Speaker 3 (06:44):
That.
Speaker 2 (06:46):
Biden is as good or better than George Washington, which
is the most Let's not forget that the only reason
Biden is not has not been indicted and prosecuted was
because the Special Council found that he was not mentally
(07:08):
fit enough to stand trial. That was the only reason.
The Biden stole three hundred million dollars, you know, from taxpayers,
basically by getting money illegally from China and then spread it,
and it's probably way more than that. Over the course
of his fifty years of enriching himself and his family
(07:32):
down to grandkids and nieces and nephews. And the only
reason why he wasn't indicted was because the Special Council
found that he mentally wouldn't understand what was going on anyway.
And here we're comparing him, you know, some of our
media to George Washington. When China is flying, you know,
(07:58):
long range bomber that can drop nuclear bombs on the
US just off the coast of Alaska. Russian nuclear subs
are just off the coast of Cuba, and we're going,
this is the greatest president of all time. And this
is the greatest you know candidate now new candidate for
the presidency, a woman that was in charge of the
(08:20):
border that we've had hundreds of thousands of kids die
from fentanyl. We've had hundreds of thousands and millions of
unvetted military age males coming from terrorist countries, prisons, China,
Russia coming across our borders. And this doesn't, you know,
(08:40):
alarm everybody, Well, it does, and it does affect your
infect your investments, and it does create volatility that will
continue to see, you know, especially with everything going on,
if something in God forbid, first assassination attempt. Now do
we see a terrorist attack inside the US. Christopher Ray,
(09:05):
the head of the FBI, testified that we have never
been less safe inside the United States than we are
right now because of the terrorists and the open borders
that Kamala Harris was in charge for. And she's the
(09:26):
one who's qualified to protect us from China and Russia
and terrorists. Give me a royal break, people, And so
what is our job. Our job is to protect your
investments from mistakes that are being made that God forbid
they become catastrophic. So call us at nine one six
(09:48):
nine six seven thirty five hundred. Let us show you
how you need to prepare your portfolio for the uncertainty
and the what ifs that could happen, you know, this
year and over the next couple of years. Again called
nine one six nine six seven thirty five hundred. All right,
we'll get into some specifics, specific investments. You're listening to
(10:11):
John Scambri and I'm here with my partner Giuseppe Visconti,
And once again, we're certified portfolio managers that specialize in
helping people who are retired are about to retire manage
their money. We do have, as I mentioned, Microsoft, Amazon, Meta, Facebook,
whatever you call it reporting this week. Would you buy
(10:31):
any of those, you know if they dip.
Speaker 3 (10:36):
I like Amazon because they're pretty resilient.
Speaker 4 (10:39):
Yeah, you know, Meta and Microsoft. I don't have to
look further into that, but Amazon is pretty resilient. People
are going to use it, you know, no matter what's
going on in the market. The big thing with them
is our consumers spending a lot less than what they
spent prior to.
Speaker 2 (10:57):
But you look at Amazon and you realize that Amazon
is no longer you know, the company that started I
don't know, twenty years ago, you know, with book sales.
Speaker 3 (11:07):
They've got into cloud and storage.
Speaker 2 (11:10):
And there, and then you listen to their quarterly earnings
reports and you get that data and you dive into
the financials and they make very little money on that
piece of their business. I mean, their biggest UH profit
center is there there their aws, they're Amazon Web Services
and that's you know, and their cloud based UH services,
(11:32):
which is under that. And now you know where where
their AI effort is going to tell take them to
help them streamline you know, they're their overall business and
so you know, they're also a logistics company quite frankly,
because they also get paid to ship you know, other
(11:54):
companies' packages. And so Amazon and yes, is not the
Amazon of today. And so I agree with you as
where I was going, you know, out of the three,
I think Amazon, you know, if it does dip from
something where you know, it's like a Google that you know,
(12:14):
meets both there and exceeds both their revenue and earnings estimates,
but then says something just you know, not glorious about
AI or or the economy or future revenues, which always
seems silly to me. We can't predict what's going to
happen tomorrow, let alone what's going to happen you know,
(12:35):
three months from now, or you know, a year from
now or five years from now. Yet you know, stocks
will sell off drastically if a company during its earnings
calls goes, yeah, well we see revenue potentially slowing, you know,
six to twelve months from now. Really you could tell
us what's going to happen six to twelve months from now.
(12:56):
I would really like that ability. But if if it does,
I would tend.
Speaker 3 (13:01):
To sell the stock market.
Speaker 2 (13:02):
I know it's you know, the one. It's on purpose.
Sometimes so that you know, you can rotate, you can
take profits off the table and redeploy capital into other
sectors and other investments, you know, based on this rigmar role,
because that's really what it is.
Speaker 3 (13:19):
Right.
Speaker 2 (13:19):
Analysts will go, oh, we expect a company to earn,
say twenty cents per share this quarter, and I'm just
making up a number, and that would be a fifteen
percent increase. And then they come in and earn nineteen
cents per share and it's a fourteen point twenty five
percent increase, and they go, oh, it didn't meet analysts expectations.
(13:42):
The company's in ruin sell the stop. It only grew
by fourteen point twenty five percent in the quarter instead
of fifteen. But that's the game. That's the ridiculousness of
earning season.
Speaker 4 (13:56):
It's like a kid in junior high or you know,
going into high school. They're trying to find themselves, right,
and there's like big, big swings and moods, and there's
a lot of events of where they're irrational and you
will blow oh, you know, that's that's how the stock
market or individual stocks, or the estimates and and the
(14:19):
you know, the reports after the estimates, and that's that's
how I take it.
Speaker 2 (14:22):
Which is why you can't fall in love with any
one position. So many clients just have to be emotional
about it, right they have that stock that made that's
made them a lot of money, and they just can't,
you know. And and it could be a stock fund
or or a stock etf or whatever it is, and
(14:42):
they just won't let it go for a variety of reasons,
maybe because it's in a taxable account, you know again,
or they just feel that it's, oh, it's going to
go even higher and higher and higher, but at some point,
you know, in order to realize a profit and lock
that in so that if some of this you know,
(15:04):
uncertainty that we're going through right now doesn't take away
that hard, long term profit that you made. And that's
the biggest mistake that we see people make, is that
they just won't let go of certain things. And you
get married to it, and they get married to it.
And we have a couple of really crazy examples of
(15:25):
clients that had millions of dollars in a position that
turned into hundreds of thousands of dollars from millions or
ten million or ten million, two million to two million,
and it's because they just won't sell it no matter
what happens.
Speaker 4 (15:41):
Either either they they're married to the stock or they
don't want the implications of capital gains taxes.
Speaker 2 (15:49):
Right, but think about that. Would you rather pay capital
gains tax on ten million or two million?
Speaker 3 (15:56):
Now?
Speaker 2 (15:56):
I'm not that good at math, you know, I've only
been in finance for thirty plus years. I but ten
million or two million? You know which are you left
with more after tax? I mean, it's it's it's It's
a pretty simple thing. And that is what we're here for.
That is why it is so crucial to work with
proactive money managers like Giuseppe and I to help you
(16:20):
just go, okay, I can't do it myself. Those decisions
are now, you know, out of my hands. You've got
my best interest at heart, and as fiduciaries, we do
have your best interest at heart. You get out when
you need to get out, You get me in when
we need to get in into the various things that
are a going to accomplish my written plan that you
(16:41):
guys are going to do and update for.
Speaker 4 (16:44):
That's the important part is we're making the decisions based
off of your plan, based off of your goals, what
is it that you need. We're not making the decisions
based off of any emotions like oh I bought this,
I went down, maybe it's going to come back up,
or I don't want to sell any because I'm gonna
pay some capital gains taxes, whatever the case may be. Right,
(17:07):
the emotional decisions usually don't end up providing, you know,
a sound result versus when you're putting.
Speaker 3 (17:18):
When when decisions are made based off of a.
Speaker 4 (17:20):
Plan or strategy, and and and you know, the plan
or strategy can change. It's not that we make the
plan or the strategy day one, set it in concrete,
and then no matter what happens in the course of
the next few years, we just stick to that strategy.
No life happens. And obviously the market and economy, I mean,
look at how much thing things have changed in the
(17:40):
past two three weeks, just with our political environment right,
which we've talked about and then also has impacts to
the market and the economy.
Speaker 2 (17:49):
And quite frankly, we've been calling for a rotation, We've
been calling for a pullback and a selloff. We've said repeatedly,
you know, for months, the market is over bought. The
S and P five hundred is overbought, especially in you know,
the chip and technology side of the stocks that make
(18:13):
up the S and P five hundred, and that there
was value in other investments. And we're seeing those other
stocks that are in other sectors like utilities and healthcare
not sell off and go down as much as the
chip stocks because they weren't overbought in the same ratio
(18:35):
that that the the AI and chip and new tech
you know, technology stocks were overbought to So you know,
there's you gotta be a student of this, and you've
got to be somebody who does this full time to
be able to, you know, know when and what to
(18:55):
do based on what's going on. And so what I
always like to talk about is, I mean, if you're
in your sixties, seventies or eighties and you're going it alone,
you're managing your own money without a plan, you're going
to be in for a real rough go here over
the coming months. Not only is July and August typically
(19:18):
super volatile for stocks, you throw in the geopolitical things
the general election, I mean, and that you.
Speaker 3 (19:27):
Know we could have right now.
Speaker 4 (19:29):
We also have the Federal Reserve going to be meeting
at the end of this month, So it's quite a
big going on.
Speaker 2 (19:35):
Yeah, because it's guess what we've said this as well,
it's still about oh, when's the next FED meeting and
are they going to cut rates? You know, are we
going to have a soft landing to the recession? And
and and that's that's not gone away. That's still something
that as we get close to the day, you know,
(19:55):
stocks will be volatile and bonds will be volatile around
you know, way for the outcome of that meeting. And
quite frankly, I don't think there will be a rate cut,
you know early. I don't think there should be, although
there probably will be because it is political a rate
cut in September. There should not until we address government
(20:19):
spending and the inflation that they project in their spending.
We've seen no cuts to the budget. Not only have
we seen no cuts true cuts to the budget, we
haven't seen cuts to the increase in the budget. So
until you tackle fiscal policy coming from the United States government,
(20:41):
you will not control inflation, end of story. And if
we get rate cuts, it will only make matters worse
because what will happen is inflation will come back even
worse than it was, and then will really destroy our
banking system, really destroy our economy, will really destroy our
(21:03):
consumer if they have to go through another bout of
double digit price increases because our government cuts rates too soon.
Be prepared for that. That is what is coming in
my prediction, rate cuts that will not control inflation because
the government doesn't control their spending, and inflation comes back
(21:23):
even worse. And if your portfolio isn't properly allocated and
prepared for it, you're going to see potential, you know,
twenty thirty forty fifty percent losses in those high flying stocks.
And you'll wish you would have listened to John Scammery
and Duseppi Viskani call nine one, six ninety six, seven
(21:43):
thirty five hundred. We were talking about, you know, the
potential for a sizeable or at least I was talking
about the potential for a sizeable mistake by the Fed
if they cut rates too early and then inflation came
back stronger. What that would do to our economy, our
(22:05):
middle class quite frankly, and our markets. And the reality
is that mistake has been done, you know, twice before.
Speaker 4 (22:14):
More time than mistakes haven't been So their track record
is that you can expect them to make a mistake
in that either they keep rates high for too long
and something whin the financial system breaks, or they cut
too soon and inflation rears its ugly head on one
(22:36):
or the other. But more times than not, they have
created an environment where something breaks and a recession ensues,
versus then being the engineers to create an environment for
a quote unquote soft landing or no landing.
Speaker 2 (22:55):
So yeah, the reality is again, until we tackle fiscal
policy and fiscal spending, how about just don't increase the
rate of line items spending in the budget next year,
Start with just a freeze on you know what you're
(23:17):
going to spend next year instead of calling for you know,
an increase in every unnecessary you know, level of agency
and line item for god knows what I mean. I
can't even imagine, you know, just the pages and pages
and pages of bills that are in you know, our
(23:40):
budget and where that money at the amount of waste.
But again, how about just you know, put a cap
where you go, Okay, we are we're going to get
four point seven trillion dollars this year. Our budget's four
point seven trillion dollars, and that would go a long
(24:00):
way at stopping inflation all by itself. The only thing
the the FOMC and the Federal Reserve Board can do
is actually break the back of the consumer, break the
back of the employer, and increase unemployment and increase you know,
(24:22):
the UH, the inability for people to be able to
afford goods and services. That is what's coming, by my estimate,
because the exact writing on the wall from previous periods
in our past are shaping up to look very similar
to this where we're going to cut too soon because
(24:48):
of political ambition, because a cut to rates right now
would be nothing more than a political cut to rates,
because there is no recession that you need to cut
for right now. Unemployment is not high all right, and
GDP is not negative. Those are the two main measurements
(25:12):
of a recession. Do you have back to back quarters
of GDP retraction? No, The answer is no. Do we
have five six, seven, eight nine percent unemployment? The answer
is again no. And so the need to cut rates
preemptively can only turn around and make inflation worse. Now,
(25:38):
couple that with tax hikes. You want to talk about
breaking the economy. So raise you know, cut trigger more inflation,
keep the government spending and tax the heck out of
the middle class, the you know, the main consumer, and
see what happens to our then we will have a recession,
(26:01):
and a very very deep and big one. And so well.
Speaker 4 (26:06):
The problem is is they're in a tight spot. And
GDP and these indicators you talk about their lagging, so
once you get the report, it's already happened, right, right,
So they're trying to forecast based off of you know,
current data and what things could be, what GDP is
going to be, and so on and so forth, because
that's all lagging indicators, that's all from the past. And
(26:28):
but the problem is really is the FED has changed,
right its position from the early two thousands to forecasting
and one of being in abundance versus just looking at
these two metrics, which is primarily price stability and unemployment
and then adjusting policy based off of that.
Speaker 2 (26:50):
Yeah. Well, and there again, I may be more on
the on the non obvious you know bandwagon, which is
the corner, is the corner that the FED is backed into,
is the thirty five trillion dollars in debt. They need
(27:12):
rates to be lower so that they can afford to
payment on the thirty five trillion dollars in debt, because
right now, the thirty five trillion dollars in debt, if
rates go higher, will be the biggest line item of
the federal budget, more than the military and more than
Medicare and soil security at the current rate of spend
(27:36):
to cover the interest on that debt. And that is
the real reason why we're going into this. Hey, we
got to figure out how to get rates lower because
we're going to bankrupt the United States anyway, because then
what will be the solution for that, It will be
to borrow more money to cover to cover then payments
(28:00):
to Social Security and Medicare in the military, which then
means that the debt will get even bigger the pay
and will actually exponentially create the beginning of the end
of our you know way of doing things. This debt
and deficit you know spending, that is what will blow
(28:22):
it up. So and they know the writing is on
the wall if they don't get rates lower based on
having thirty five trillion and based on not cutting you know,
expenses at all, adding more expenses. We keep adding all
these entitlements, adding you know, uh, you know, debt forgiveness,
(28:42):
adding let's not forget fourteen million people into the country
that they want to give social security and medicare, welfare, yeah,
and welfare too, and places to live and free phones
and feed them and educate them, all with them not
contributing a single dime into our In fact, most of
(29:05):
the time, when people you know that come across the
border illegally, they take their their ill you know, their
illegal money that they're being given without taxpayers you know,
you know, authorizing it, and they send it back to
their country that they came for. It doesn't even go
towards consumption, which would then generate something for the United States.
(29:27):
They they send it back to their home country.
Speaker 3 (29:30):
And so.
Speaker 2 (29:32):
It's it's a it's a snowball that we've got to
get head and finally do something. And you know, Republicans
are just as bad. They kick the can down the road,
just as bad as as Democrats. And quite frankly, again,
(29:53):
the only reason why we're cutting rates is because we
can't afford the payment on the national debt. And if
we don't do something about that, then that snowball eventually
is going to get so big that it's just going
to wipe out, you know, the way we do things, and.
Speaker 4 (30:11):
So well, and typically what happens is a recession happens
and it brings back back into equalization.
Speaker 2 (30:17):
Well, this wouldn't be a recession. This would be a
financial collapse bigger than the the banking collapse that was
in billions, not mega trillions. This collapse would be mega trillions,
and it could completely change the way we do things
because there's no there's no there's no reset for it.
(30:40):
You can't just go, oh, let me borrow, you know,
thirty five trillion dollars from who, let me from where?
Let me charge that off? Right, so grinning upper credit card.
Well that is called it. By the way, that experiment
has been done as well, that's called the debt jubilee.
And countries like Greece and Spain and others have done
that and they've been they've been in poverty ever since then,
(31:03):
and they'll never recover because once you once you was.
Speaker 4 (31:07):
Right Portugal, Italy, Greece and Spain.
Speaker 2 (31:11):
So once you know, basically destroy your currency because you
you you don't back it anymore and on and you
nobody will have faith to invest in anything, not your
real estate, not your stocks, not industry of any kind
in your country. You know you're done, and so we
(31:34):
are headed down that path. It's it's unavoidable if things
don't change, and they're how are they changing. Who's going
to change them? We're an election the Republican Party, Well,
even if they're in, seeings drastically changed in the past
couple of weeks. They get in you know, here's what
bugs me, Republicans. Republicans get into office, they talk this
(31:57):
big game of fiscal we're going to do this, We're
going to do that. They had the power of the purse.
They still have the power of the purse. And not
one time have they done budget reconciliation like Nancy Pelosi
did to pass Obamacare. Not one time have they used
their power of controlling Congress to change any of the
(32:20):
fiscal policies that are destroying this country. Not one time.
If you put Nancy Pelosi back in power as Speaker
of the House, she doesn't care if you don't have
the Senate and the presidency. Remember the Obamacare that destroyed
the cost of health insurance. That was done without the
(32:42):
Senate and without the signature of the president. It was
done through the reconciliation process and not one time. Have
Republicans done that to fix things? The billions of dollars
going to the irs? They said, oh, well, we passed
a bill to you know, to overturn that and defund that.
(33:04):
Really great did but but see the Senate didn't take
it up and sign and sign off on it, which
means that it didn't even make They don't fight fire
with fire. So this election means.
Speaker 4 (33:19):
Well, they're also they're also not. I mean the whole
thing with the political arena is a lot of them
are not held accountable.
Speaker 2 (33:24):
You know, none of them are held accountable.
Speaker 4 (33:26):
They well, unless it gets to the extreme like uh Menendez,
right for example, recently, But outside of that they'll be
They'll be in there for years and decades and so
and so forth.
Speaker 2 (33:37):
I have stole a third of a billion dollars and
are not being held accountable.
Speaker 3 (33:43):
That's what I'm talking about.
Speaker 2 (33:45):
Every detail of the crimes that they've committed for decades
is now fact.
Speaker 3 (33:51):
You and I were talking the other day, just political figures.
Speaker 4 (33:54):
All of their salaries and income is public right, and
they don't get paid much. I mean, what's the what's
the President's supposed to be the highest paid? Yeah, what
is it per year four hundred something thousand. It's a
lot of these politicians, not even presidents right, much lower
on the total pool. And they're in office for however long,
and then they get out and they go to the
(34:15):
private sector and they're multime multi millionaireshow.
Speaker 2 (34:19):
Well, let's talk more about that. You're listening to John Scambrand.
I'm here with my partner Deceptivescani, and wow, we've been
more political these last couple of weeks than typical. But
you can't help it. I mean, it's it's just causing
the markets to go all over the place. A lot
of change is going on, but fundamentally, it still comes
down to fundamentals. I mean, when you're when you're looking
at the the investments that you're choosing and do they
(34:41):
fit appropriately in your financial plan? You know, that's that's
what matters. You know, most of these things are short term.
You know, one of the slides we show in our
workshops is how these big geopolitical uh uh tension type
times affect investments in the first month and then by
(35:03):
the six, six and twelve months later, and quite frankly,
you know, most of the time, I mean eleven out
of fourteen major events in our history. The eleven of
those fourteen twelve months later the stock market was substantially up.
(35:24):
And so you know, is that what we're experiencing now
initial pullback, which is what you tend to see.
Speaker 4 (35:32):
And the other thing to look at, which we also
have slides on, is the inverted yield curve, the trend
of unemployment. Some of the other economic indicators use a
sam rule. These are all waving cautionary flags. You see
if you go online, you'll see some talking head saying, no,
these are older indicators. You know, quote unquote, this time
(35:57):
is different. But I take some caution with that anytime
I hear this time is different, because every recession is different.
And these indicators that I'm talking about, you know, invert
or have some sort of trend typically just previous to recession.
(36:18):
It's not going to tell you the timing of it's
not gonna say, oh.
Speaker 3 (36:21):
Four or whatever.
Speaker 4 (36:22):
But we are getting closer to a point that either
these indicators, like many times before, have predicted a recession
and we're getting closer to that point, or this time
is really different. And just the other day I showed
you an article from January of two thousand and eight,
Oh yeah, and it was it was well, no, that
was a different one. But it's all the analysts, you know,
(36:46):
and the investment firms Goldman, Sacks and some of these
big names out there. They're still out there now, but
there were there were big names back then on what
their estimates for s and P five hundred for a
year end of two thousand and eight.
Speaker 2 (36:58):
Oh yes, yes, yes, yes.
Speaker 4 (36:59):
And and one of them Strategists, which is a big
investment firm and always puts forecasts for SMP five hundred, nasdacs,
so on and so forth, and it had indicated now
at that point in time in January, SMP five hundred
was around believe it or not, it's like, you know,
in the twelve hundred range, twelve twenty, twelve forty something
(37:20):
like that, right, But they had indicated that they're projecting
their forecast the S and P five hundred by year
in two thousand and eight was going to be I
believe it was sixteen over sixteen hundred, okay, right, so
from twelve hundred something sixteen one hundred, and in their
commentary was that there is, you know, some worry that
(37:45):
earnings would slow down, which is what we're hearing now, right,
because we've had quarter after quarter and some of these
big names that ear record. Yeah, but the pe multiple
is going to expand, and the and the Feds will
be cutting rates, and so that will also be a
(38:07):
catalyst to help spur the market growth. And then there's
some other analyst comments of you know what sort of
sectors of the market or stocks would be great to
purchase right now. One of them was saying financials is
great to purchase.
Speaker 3 (38:25):
This is in January two thousand.
Speaker 2 (38:28):
Right before the fan whoops, beep.
Speaker 3 (38:33):
That's all right, Michael, take that out.
Speaker 4 (38:36):
But what's interesting, and this is January two thousand. Now,
things were already starting boiling two thousand and seven with
a subprime crisis, right, and so January two thousand and eight,
and this is what was coming down the pipeline and
the lower end estimates at that point in time, I
think we're around fourteen hundred. So there was growth across
the board from the different investment firms, some lower than others,
(39:00):
some much higher. But it sounds awfully familiar. And not
to say that last recession is going to be because
every recession is different, but it sounds awfully familiar to
some of the rhetoric and narrative that we're that we're
seeing and reading right now, either watching TV or.
Speaker 3 (39:16):
Or on on online or on your phones. Is cutting rates.
Speaker 4 (39:22):
Oh, and that's gonna help spur because once they cut rates,
then no, if you look at history, when the Feds
pause and then they start cutting rates, more times than not,
what happens the stock market comes down and then at
some point, once a once a rate cutting hits a
bottom and they're like, okay, we've cut rates as much
as we needed to. Then the market starts bouncing up
from that point.
Speaker 2 (39:42):
And you got to really digest why they're cutting rates. So,
if the Fed is going to preemptively cut rates, it's
because they see something already broken in the economy. And
then you can't wait for that announcement to happen. It is,
it's too late. Don't procrastinate, come in for a review.
(40:07):
Let us help you rebalance and potentially protect as much
of your profit and returns as we potentially can. There
are always things that do better, you know, in different
you know situations. So when rates are going down, you know,
bonds do better than stocks. You know, private credit does
(40:28):
better than stocks. So on and so forth. It just
depends we can build portfolios that encompass all the different things,
all the different categories of investments, that are weighted based
on what's going on, based on what your goals and
objectives are, based on the rates of returns that you need,
not just some pie in the sky thing where you
(40:50):
just go, oh, stocks have been great. I'm going to
have eighty percent of my money in stocks until they're broken,
and then I go, oh, God, now I'm going to
go all into you know, cash, and then okay, then
I wait for things not to be broken, which means
they went back up again, and then I get back
out of cash and go back into the things that
already went up again. This is what a lot of
(41:12):
people do, and they do it, you know, without knowing it,
because they're using emotion instead of research. They're using emotion
instead of history. They're using emotion instead.
Speaker 3 (41:28):
Of looking at the data.
Speaker 2 (41:32):
Well yeah, I guess that could fall under research. But
the data, I mean, the writing is on the wall.
These signs were here for this previous sell off. We went,
you know, into the last couple of weeks. Joseppie and
I said it was coming, and it came. We're now
still in an area of opportunity to where you want
(41:54):
to rebalance the type of stocks that you have. You
want to rebalance out of the type of overall invests
smiths that you have into other types of investments that
do better in a in a decreasing interest rate environment,
in a decreasing inflationary environment, but more importantly one where
(42:16):
we don't know if the Fed blows it again, and
we think they will. We think this these interest rate
cuts could be a mistake, and there are definitely areas
that you want to be in if those mistakes do
come to fruition. So call us at nine to one
six nine six seven thirty five hundred. There will be
(42:38):
absolutely no pressure or any obligation. We don't need more clients.
We're just fine. Do we like getting more clients, Sure,
but we just love helping people with information that we've
you know, feel we're pretty good at you know, uncovering,
especially since we've been doing this Jusepi since two thousand
(43:01):
and eight and me since nineteen ninety two in various
forms for various companies. But we've never been more passionate
than we are now, you know, doing this through our
own company, backed by some of the biggest players in
the industry, to help our retired clients have the best
chance at success, no matter what's going on. Call us
(43:22):
at nine one, six ninety six, seven thirty five hundred.
You've been listening to John Scambering to Seppe Vescani the
wise money guys. Hope you enjoyed the show. Talk to
you all later.
Speaker 3 (43:32):
Have a good weekend. Are weekend
The Wise Money Guys Radio Show is brought to you
by One Source of Wealth Management SEC licensed three one
nine zero seven eight. For disclosures and more information, visit
our website One Source WM dot com or call nine
one six nine six seven thirty five hundred.
Speaker 2 (00:16):
Hello and welcome to the Wise Money Guys radio Show.
I'm your co host John Scambray and I'm here with
my partner Sevin Visconsin and we are certified portfolio managers
out of Granite Bay, California, for One Source Wealth Management
that specialize in helping people who are retired are about
to retire, manage their money and do their financial plans.
So if you like our show called nine one six
(00:40):
nine six seven thirty five hundred, leave us a message
and Kathy, we'll get back to you, or if it's
just a question, we'll get back to you during the week.
But again called nine one six nine six seven thirty
five hundred. I think we need to label this show.
I told you so right, because it's part well so many.
(01:03):
But the reality is is that we I have been saying,
you know that there would be a selloff at some point.
Was whether it was three percent, five percent, you know,
at some point during every bowl market there is an
interim typical correction. Yeah, I don't know if last week
(01:26):
was the start of that correction. It just depends on,
you know, what the catalysts are.
Speaker 3 (01:34):
Now.
Speaker 2 (01:34):
The early catalysts last week were some of the earnings
that came out.
Speaker 4 (01:40):
Actually started not last week but the week before with
the rhetoric between Biden and Trump and the pressure on
chip stocks in China.
Speaker 2 (01:48):
You bet, And so that was one catalyst. Then we
went into the following week last week, which was you know,
Google and Tesla talking about what the money they were
spending and you know, the pressure for Tesla on ev profitability.
For Google, it was you know, hey, we beat revenue,
(02:08):
we beat earnings. However, we're spending billions on AI and
we don't know exactly, you know, how much money, how
much return on investment will come from you know, these
expenditures that were that we're making. And and again we
could have you know, other things. So this next week
we have you know, Amazon, Microsoft, and Facebook meta reporting
(02:32):
and if if those three do well, because again because
of the waiting that they have on the end to
c the S and P five hundred or the Nasdaq
one hundred. You know, you could see a significant move
back up or continuing down. You could see that continuing
correction down. And we've been calling for a correction down.
(02:57):
Now you could already say that we were right, and
it came and it went. However, there are still a
lot in these these certain areas of the market that
may be over bought and overpriced. There is other areas
that that Giuseppe and I like, you know, that that
(03:18):
aren't overbought. They didn't go up, you know, the thirty
percent that the chip stocks went up or the AI
stocks went up, you know, this year, so they don't
have the room to sell off. We I still continue
to love the energy sector and I love you know,
(03:38):
big dividend pain stocks that have the the the profits
to turn around and share them with shareholders. You know,
that's that's a crucial way to increase your total your
potential total return at the same time, you know, lowering
your overall volatility. So that is going to be in
(04:04):
my estimation, the rest of what we is what will
continue to experience for the rest of the year, especially
you know, as who knows what other surprises are going
to come on the political front, on the election front.
You know, we went from the just most assistency I've
(04:25):
seen in my voting lifetime, which was the assassination attempt
that turns out, you know, wasn't maybe I mean, without
going down too many conspiracy theories, but all these miss
this mishaps by our agencies, you can't help but to
think was it on purpose? You know, that's a story
(04:48):
for a different time. But again, however it happened, that
was one massive event that kind of spooked the markets.
And you see things get rattled and go up and down,
and you see that move from risk you know on
to risk off and then and then you see the
president disappear for a while, and and and then announced
(05:12):
that he's not running for reelection. And then the d
n C anoint Kamala Harris the VP bypassing the primary.
On top of that, this is something that isn't widely reported,
but you know, testing the resolve of the US and
(05:33):
pushing the boundaries. You see you know, long range Chinese bombers, uh,
you know, off the coast of Alaska paired up and
partnered with Russian fighter jets. Now is that a coincidence
with the president?
Speaker 3 (05:50):
What movies is I didn't watch that movie.
Speaker 2 (05:53):
I mean literally, it's just that's what sounds.
Speaker 3 (05:56):
It sounds like a Netflix SERI is.
Speaker 2 (05:58):
Like a movie. But the reality is is that these
are very scary times. You take open borders, you take
you had we had the nuclear subs of Russia off
of Cuba. Now you have Chinese bombers off of Alaska.
And you've got an incompetent, infirm mentally you know, incapacitated
(06:23):
president who you know won't won't stand down. Doesn't mean
that Kamala would be any better. And then you've got
the media completely lying to Americans and saying this was
literally on some of the other opposing shows that I watch.
Speaker 3 (06:44):
That.
Speaker 2 (06:46):
Biden is as good or better than George Washington, which
is the most Let's not forget that the only reason
Biden is not has not been indicted and prosecuted was
because the Special Council found that he was not mentally
(07:08):
fit enough to stand trial. That was the only reason.
The Biden stole three hundred million dollars, you know, from taxpayers,
basically by getting money illegally from China and then spread it,
and it's probably way more than that. Over the course
of his fifty years of enriching himself and his family
(07:32):
down to grandkids and nieces and nephews. And the only
reason why he wasn't indicted was because the Special Council
found that he mentally wouldn't understand what was going on anyway.
And here we're comparing him, you know, some of our
media to George Washington. When China is flying, you know,
(07:58):
long range bomber that can drop nuclear bombs on the
US just off the coast of Alaska. Russian nuclear subs
are just off the coast of Cuba, and we're going,
this is the greatest president of all time. And this
is the greatest you know candidate now new candidate for
the presidency, a woman that was in charge of the
(08:20):
border that we've had hundreds of thousands of kids die
from fentanyl. We've had hundreds of thousands and millions of
unvetted military age males coming from terrorist countries, prisons, China,
Russia coming across our borders. And this doesn't, you know,
(08:40):
alarm everybody, Well, it does, and it does affect your
infect your investments, and it does create volatility that will
continue to see, you know, especially with everything going on,
if something in God forbid, first assassination attempt. Now do
we see a terrorist attack inside the US. Christopher Ray,
(09:05):
the head of the FBI, testified that we have never
been less safe inside the United States than we are
right now because of the terrorists and the open borders
that Kamala Harris was in charge for. And she's the
(09:26):
one who's qualified to protect us from China and Russia
and terrorists. Give me a royal break, people, And so
what is our job. Our job is to protect your
investments from mistakes that are being made that God forbid
they become catastrophic. So call us at nine one six
(09:48):
nine six seven thirty five hundred. Let us show you
how you need to prepare your portfolio for the uncertainty
and the what ifs that could happen, you know, this
year and over the next couple of years. Again called
nine one six nine six seven thirty five hundred. All right,
we'll get into some specifics, specific investments. You're listening to
(10:11):
John Scambri and I'm here with my partner Giuseppe Visconti,
And once again, we're certified portfolio managers that specialize in
helping people who are retired are about to retire manage
their money. We do have, as I mentioned, Microsoft, Amazon, Meta, Facebook,
whatever you call it reporting this week. Would you buy
(10:31):
any of those, you know if they dip.
Speaker 3 (10:36):
I like Amazon because they're pretty resilient.
Speaker 4 (10:39):
Yeah, you know, Meta and Microsoft. I don't have to
look further into that, but Amazon is pretty resilient. People
are going to use it, you know, no matter what's
going on in the market. The big thing with them
is our consumers spending a lot less than what they
spent prior to.
Speaker 2 (10:57):
But you look at Amazon and you realize that Amazon
is no longer you know, the company that started I
don't know, twenty years ago, you know, with book sales.
Speaker 3 (11:07):
They've got into cloud and storage.
Speaker 2 (11:10):
And there, and then you listen to their quarterly earnings
reports and you get that data and you dive into
the financials and they make very little money on that
piece of their business. I mean, their biggest UH profit
center is there there their aws, they're Amazon Web Services
and that's you know, and their cloud based UH services,
(11:32):
which is under that. And now you know where where
their AI effort is going to tell take them to
help them streamline you know, they're their overall business and
so you know, they're also a logistics company quite frankly,
because they also get paid to ship you know, other
(11:54):
companies' packages. And so Amazon and yes, is not the
Amazon of today. And so I agree with you as
where I was going, you know, out of the three,
I think Amazon, you know, if it does dip from
something where you know, it's like a Google that you know,
(12:14):
meets both there and exceeds both their revenue and earnings estimates,
but then says something just you know, not glorious about
AI or or the economy or future revenues, which always
seems silly to me. We can't predict what's going to
happen tomorrow, let alone what's going to happen you know,
(12:35):
three months from now, or you know, a year from
now or five years from now. Yet you know, stocks
will sell off drastically if a company during its earnings
calls goes, yeah, well we see revenue potentially slowing, you know,
six to twelve months from now. Really you could tell
us what's going to happen six to twelve months from now.
(12:56):
I would really like that ability. But if if it does,
I would tend.
Speaker 3 (13:01):
To sell the stock market.
Speaker 2 (13:02):
I know it's you know, the one. It's on purpose.
Sometimes so that you know, you can rotate, you can
take profits off the table and redeploy capital into other
sectors and other investments, you know, based on this rigmar role,
because that's really what it is.
Speaker 3 (13:19):
Right.
Speaker 2 (13:19):
Analysts will go, oh, we expect a company to earn,
say twenty cents per share this quarter, and I'm just
making up a number, and that would be a fifteen
percent increase. And then they come in and earn nineteen
cents per share and it's a fourteen point twenty five
percent increase, and they go, oh, it didn't meet analysts expectations.
(13:42):
The company's in ruin sell the stop. It only grew
by fourteen point twenty five percent in the quarter instead
of fifteen. But that's the game. That's the ridiculousness of
earning season.
Speaker 4 (13:56):
It's like a kid in junior high or you know,
going into high school. They're trying to find themselves, right,
and there's like big, big swings and moods, and there's
a lot of events of where they're irrational and you
will blow oh, you know, that's that's how the stock
market or individual stocks, or the estimates and and the
(14:19):
you know, the reports after the estimates, and that's that's
how I take it.
Speaker 2 (14:22):
Which is why you can't fall in love with any
one position. So many clients just have to be emotional
about it, right they have that stock that made that's
made them a lot of money, and they just can't,
you know. And and it could be a stock fund
or or a stock etf or whatever it is, and
(14:42):
they just won't let it go for a variety of reasons,
maybe because it's in a taxable account, you know again,
or they just feel that it's, oh, it's going to
go even higher and higher and higher, but at some point,
you know, in order to realize a profit and lock
that in so that if some of this you know,
(15:04):
uncertainty that we're going through right now doesn't take away
that hard, long term profit that you made. And that's
the biggest mistake that we see people make, is that
they just won't let go of certain things. And you
get married to it, and they get married to it.
And we have a couple of really crazy examples of
(15:25):
clients that had millions of dollars in a position that
turned into hundreds of thousands of dollars from millions or
ten million or ten million, two million to two million,
and it's because they just won't sell it no matter
what happens.
Speaker 4 (15:41):
Either either they they're married to the stock or they
don't want the implications of capital gains taxes.
Speaker 2 (15:49):
Right, but think about that. Would you rather pay capital
gains tax on ten million or two million?
Speaker 3 (15:56):
Now?
Speaker 2 (15:56):
I'm not that good at math, you know, I've only
been in finance for thirty plus years. I but ten
million or two million? You know which are you left
with more after tax? I mean, it's it's it's It's
a pretty simple thing. And that is what we're here for.
That is why it is so crucial to work with
proactive money managers like Giuseppe and I to help you
(16:20):
just go, okay, I can't do it myself. Those decisions
are now, you know, out of my hands. You've got
my best interest at heart, and as fiduciaries, we do
have your best interest at heart. You get out when
you need to get out, You get me in when
we need to get in into the various things that
are a going to accomplish my written plan that you
(16:41):
guys are going to do and update for.
Speaker 4 (16:44):
That's the important part is we're making the decisions based
off of your plan, based off of your goals, what
is it that you need. We're not making the decisions
based off of any emotions like oh I bought this,
I went down, maybe it's going to come back up,
or I don't want to sell any because I'm gonna
pay some capital gains taxes, whatever the case may be. Right,
(17:07):
the emotional decisions usually don't end up providing, you know,
a sound result versus when you're putting.
Speaker 3 (17:18):
When when decisions are made based off of a.
Speaker 4 (17:20):
Plan or strategy, and and and you know, the plan
or strategy can change. It's not that we make the
plan or the strategy day one, set it in concrete,
and then no matter what happens in the course of
the next few years, we just stick to that strategy.
No life happens. And obviously the market and economy, I mean,
look at how much thing things have changed in the
(17:40):
past two three weeks, just with our political environment right,
which we've talked about and then also has impacts to
the market and the economy.
Speaker 2 (17:49):
And quite frankly, we've been calling for a rotation, We've
been calling for a pullback and a selloff. We've said repeatedly,
you know, for months, the market is over bought. The
S and P five hundred is overbought, especially in you know,
the chip and technology side of the stocks that make
(18:13):
up the S and P five hundred, and that there
was value in other investments. And we're seeing those other
stocks that are in other sectors like utilities and healthcare
not sell off and go down as much as the
chip stocks because they weren't overbought in the same ratio
(18:35):
that that the the AI and chip and new tech
you know, technology stocks were overbought to So you know,
there's you gotta be a student of this, and you've
got to be somebody who does this full time to
be able to, you know, know when and what to
(18:55):
do based on what's going on. And so what I
always like to talk about is, I mean, if you're
in your sixties, seventies or eighties and you're going it alone,
you're managing your own money without a plan, you're going
to be in for a real rough go here over
the coming months. Not only is July and August typically
(19:18):
super volatile for stocks, you throw in the geopolitical things
the general election, I mean, and that you.
Speaker 3 (19:27):
Know we could have right now.
Speaker 4 (19:29):
We also have the Federal Reserve going to be meeting
at the end of this month, So it's quite a
big going on.
Speaker 2 (19:35):
Yeah, because it's guess what we've said this as well,
it's still about oh, when's the next FED meeting and
are they going to cut rates? You know, are we
going to have a soft landing to the recession? And
and and that's that's not gone away. That's still something
that as we get close to the day, you know,
(19:55):
stocks will be volatile and bonds will be volatile around
you know, way for the outcome of that meeting. And
quite frankly, I don't think there will be a rate cut,
you know early. I don't think there should be, although
there probably will be because it is political a rate
cut in September. There should not until we address government
(20:19):
spending and the inflation that they project in their spending.
We've seen no cuts to the budget. Not only have
we seen no cuts true cuts to the budget, we
haven't seen cuts to the increase in the budget. So
until you tackle fiscal policy coming from the United States government,
(20:41):
you will not control inflation, end of story. And if
we get rate cuts, it will only make matters worse
because what will happen is inflation will come back even
worse than it was, and then will really destroy our
banking system, really destroy our economy, will really destroy our
(21:03):
consumer if they have to go through another bout of
double digit price increases because our government cuts rates too soon.
Be prepared for that. That is what is coming in
my prediction, rate cuts that will not control inflation because
the government doesn't control their spending, and inflation comes back
(21:23):
even worse. And if your portfolio isn't properly allocated and
prepared for it, you're going to see potential, you know,
twenty thirty forty fifty percent losses in those high flying stocks.
And you'll wish you would have listened to John Scammery
and Duseppi Viskani call nine one, six ninety six, seven
(21:43):
thirty five hundred. We were talking about, you know, the
potential for a sizeable or at least I was talking
about the potential for a sizeable mistake by the Fed
if they cut rates too early and then inflation came
back stronger. What that would do to our economy, our
(22:05):
middle class quite frankly, and our markets. And the reality
is that mistake has been done, you know, twice before.
Speaker 4 (22:14):
More time than mistakes haven't been So their track record
is that you can expect them to make a mistake
in that either they keep rates high for too long
and something whin the financial system breaks, or they cut
too soon and inflation rears its ugly head on one
(22:36):
or the other. But more times than not, they have
created an environment where something breaks and a recession ensues,
versus then being the engineers to create an environment for
a quote unquote soft landing or no landing.
Speaker 2 (22:55):
So yeah, the reality is again, until we tackle fiscal
policy and fiscal spending, how about just don't increase the
rate of line items spending in the budget next year,
Start with just a freeze on you know what you're
(23:17):
going to spend next year instead of calling for you know,
an increase in every unnecessary you know, level of agency
and line item for god knows what I mean. I
can't even imagine, you know, just the pages and pages
and pages of bills that are in you know, our
(23:40):
budget and where that money at the amount of waste.
But again, how about just you know, put a cap
where you go, Okay, we are we're going to get
four point seven trillion dollars this year. Our budget's four
point seven trillion dollars, and that would go a long
(24:00):
way at stopping inflation all by itself. The only thing
the the FOMC and the Federal Reserve Board can do
is actually break the back of the consumer, break the
back of the employer, and increase unemployment and increase you know,
(24:22):
the UH, the inability for people to be able to
afford goods and services. That is what's coming, by my estimate,
because the exact writing on the wall from previous periods
in our past are shaping up to look very similar
to this where we're going to cut too soon because
(24:48):
of political ambition, because a cut to rates right now
would be nothing more than a political cut to rates,
because there is no recession that you need to cut
for right now. Unemployment is not high all right, and
GDP is not negative. Those are the two main measurements
(25:12):
of a recession. Do you have back to back quarters
of GDP retraction? No, The answer is no. Do we
have five six, seven, eight nine percent unemployment? The answer
is again no. And so the need to cut rates
preemptively can only turn around and make inflation worse. Now,
(25:38):
couple that with tax hikes. You want to talk about
breaking the economy. So raise you know, cut trigger more inflation,
keep the government spending and tax the heck out of
the middle class, the you know, the main consumer, and
see what happens to our then we will have a recession,
(26:01):
and a very very deep and big one. And so well.
Speaker 4 (26:06):
The problem is is they're in a tight spot. And
GDP and these indicators you talk about their lagging, so
once you get the report, it's already happened, right, right,
So they're trying to forecast based off of you know,
current data and what things could be, what GDP is
going to be, and so on and so forth, because
that's all lagging indicators, that's all from the past. And
(26:28):
but the problem is really is the FED has changed,
right its position from the early two thousands to forecasting
and one of being in abundance versus just looking at
these two metrics, which is primarily price stability and unemployment
and then adjusting policy based off of that.
Speaker 2 (26:50):
Yeah. Well, and there again, I may be more on
the on the non obvious you know bandwagon, which is
the corner, is the corner that the FED is backed into,
is the thirty five trillion dollars in debt. They need
(27:12):
rates to be lower so that they can afford to
payment on the thirty five trillion dollars in debt, because
right now, the thirty five trillion dollars in debt, if
rates go higher, will be the biggest line item of
the federal budget, more than the military and more than
Medicare and soil security at the current rate of spend
(27:36):
to cover the interest on that debt. And that is
the real reason why we're going into this. Hey, we
got to figure out how to get rates lower because
we're going to bankrupt the United States anyway, because then
what will be the solution for that, It will be
to borrow more money to cover to cover then payments
(28:00):
to Social Security and Medicare in the military, which then
means that the debt will get even bigger the pay
and will actually exponentially create the beginning of the end
of our you know way of doing things. This debt
and deficit you know spending, that is what will blow
(28:22):
it up. So and they know the writing is on
the wall if they don't get rates lower based on
having thirty five trillion and based on not cutting you know,
expenses at all, adding more expenses. We keep adding all
these entitlements, adding you know, uh, you know, debt forgiveness,
(28:42):
adding let's not forget fourteen million people into the country
that they want to give social security and medicare, welfare, yeah,
and welfare too, and places to live and free phones
and feed them and educate them, all with them not
contributing a single dime into our In fact, most of
(29:05):
the time, when people you know that come across the
border illegally, they take their their ill you know, their
illegal money that they're being given without taxpayers you know,
you know, authorizing it, and they send it back to
their country that they came for. It doesn't even go
towards consumption, which would then generate something for the United States.
(29:27):
They they send it back to their home country.
Speaker 3 (29:30):
And so.
Speaker 2 (29:32):
It's it's a it's a snowball that we've got to
get head and finally do something. And you know, Republicans
are just as bad. They kick the can down the road,
just as bad as as Democrats. And quite frankly, again,
(29:53):
the only reason why we're cutting rates is because we
can't afford the payment on the national debt. And if
we don't do something about that, then that snowball eventually
is going to get so big that it's just going
to wipe out, you know, the way we do things, and.
Speaker 4 (30:11):
So well, and typically what happens is a recession happens
and it brings back back into equalization.
Speaker 2 (30:17):
Well, this wouldn't be a recession. This would be a
financial collapse bigger than the the banking collapse that was
in billions, not mega trillions. This collapse would be mega trillions,
and it could completely change the way we do things
because there's no there's no there's no reset for it.
(30:40):
You can't just go, oh, let me borrow, you know,
thirty five trillion dollars from who, let me from where?
Let me charge that off? Right, so grinning upper credit card.
Well that is called it. By the way, that experiment
has been done as well, that's called the debt jubilee.
And countries like Greece and Spain and others have done
that and they've been they've been in poverty ever since then,
(31:03):
and they'll never recover because once you once you was.
Speaker 4 (31:07):
Right Portugal, Italy, Greece and Spain.
Speaker 2 (31:11):
So once you know, basically destroy your currency because you
you you don't back it anymore and on and you
nobody will have faith to invest in anything, not your
real estate, not your stocks, not industry of any kind
in your country. You know you're done, and so we
(31:34):
are headed down that path. It's it's unavoidable if things
don't change, and they're how are they changing. Who's going
to change them? We're an election the Republican Party, Well,
even if they're in, seeings drastically changed in the past
couple of weeks. They get in you know, here's what
bugs me, Republicans. Republicans get into office, they talk this
(31:57):
big game of fiscal we're going to do this, We're
going to do that. They had the power of the purse.
They still have the power of the purse. And not
one time have they done budget reconciliation like Nancy Pelosi
did to pass Obamacare. Not one time have they used
their power of controlling Congress to change any of the
(32:20):
fiscal policies that are destroying this country. Not one time.
If you put Nancy Pelosi back in power as Speaker
of the House, she doesn't care if you don't have
the Senate and the presidency. Remember the Obamacare that destroyed
the cost of health insurance. That was done without the
(32:42):
Senate and without the signature of the president. It was
done through the reconciliation process and not one time. Have
Republicans done that to fix things? The billions of dollars
going to the irs? They said, oh, well, we passed
a bill to you know, to overturn that and defund that.
(33:04):
Really great did but but see the Senate didn't take
it up and sign and sign off on it, which
means that it didn't even make They don't fight fire
with fire. So this election means.
Speaker 4 (33:19):
Well, they're also they're also not. I mean the whole
thing with the political arena is a lot of them
are not held accountable.
Speaker 2 (33:24):
You know, none of them are held accountable.
Speaker 4 (33:26):
They well, unless it gets to the extreme like uh Menendez,
right for example, recently, But outside of that they'll be
They'll be in there for years and decades and so
and so forth.
Speaker 2 (33:37):
I have stole a third of a billion dollars and
are not being held accountable.
Speaker 3 (33:43):
That's what I'm talking about.
Speaker 2 (33:45):
Every detail of the crimes that they've committed for decades
is now fact.
Speaker 3 (33:51):
You and I were talking the other day, just political figures.
Speaker 4 (33:54):
All of their salaries and income is public right, and
they don't get paid much. I mean, what's the what's
the President's supposed to be the highest paid? Yeah, what
is it per year four hundred something thousand. It's a
lot of these politicians, not even presidents right, much lower
on the total pool. And they're in office for however long,
and then they get out and they go to the
(34:15):
private sector and they're multime multi millionaireshow.
Speaker 2 (34:19):
Well, let's talk more about that. You're listening to John Scambrand.
I'm here with my partner Deceptivescani, and wow, we've been
more political these last couple of weeks than typical. But
you can't help it. I mean, it's it's just causing
the markets to go all over the place. A lot
of change is going on, but fundamentally, it still comes
down to fundamentals. I mean, when you're when you're looking
at the the investments that you're choosing and do they
(34:41):
fit appropriately in your financial plan? You know, that's that's
what matters. You know, most of these things are short term.
You know, one of the slides we show in our
workshops is how these big geopolitical uh uh tension type
times affect investments in the first month and then by
(35:03):
the six, six and twelve months later, and quite frankly,
you know, most of the time, I mean eleven out
of fourteen major events in our history. The eleven of
those fourteen twelve months later the stock market was substantially up.
(35:24):
And so you know, is that what we're experiencing now
initial pullback, which is what you tend to see.
Speaker 4 (35:32):
And the other thing to look at, which we also
have slides on, is the inverted yield curve, the trend
of unemployment. Some of the other economic indicators use a
sam rule. These are all waving cautionary flags. You see
if you go online, you'll see some talking head saying, no,
these are older indicators. You know, quote unquote, this time
(35:57):
is different. But I take some caution with that anytime
I hear this time is different, because every recession is different.
And these indicators that I'm talking about, you know, invert
or have some sort of trend typically just previous to recession.
(36:18):
It's not going to tell you the timing of it's
not gonna say, oh.
Speaker 3 (36:21):
Four or whatever.
Speaker 4 (36:22):
But we are getting closer to a point that either
these indicators, like many times before, have predicted a recession
and we're getting closer to that point, or this time
is really different. And just the other day I showed
you an article from January of two thousand and eight,
Oh yeah, and it was it was well, no, that
was a different one. But it's all the analysts, you know,
(36:46):
and the investment firms Goldman, Sacks and some of these
big names out there. They're still out there now, but
there were there were big names back then on what
their estimates for s and P five hundred for a
year end of two thousand and eight.
Speaker 2 (36:58):
Oh yes, yes, yes, yes.
Speaker 4 (36:59):
And and one of them Strategists, which is a big
investment firm and always puts forecasts for SMP five hundred, nasdacs,
so on and so forth, and it had indicated now
at that point in time in January, SMP five hundred
was around believe it or not, it's like, you know,
in the twelve hundred range, twelve twenty, twelve forty something
(37:20):
like that, right, But they had indicated that they're projecting
their forecast the S and P five hundred by year
in two thousand and eight was going to be I
believe it was sixteen over sixteen hundred, okay, right, so
from twelve hundred something sixteen one hundred, and in their
commentary was that there is, you know, some worry that
(37:45):
earnings would slow down, which is what we're hearing now, right,
because we've had quarter after quarter and some of these
big names that ear record. Yeah, but the pe multiple
is going to expand, and the and the Feds will
be cutting rates, and so that will also be a
(38:07):
catalyst to help spur the market growth. And then there's
some other analyst comments of you know what sort of
sectors of the market or stocks would be great to
purchase right now. One of them was saying financials is
great to purchase.
Speaker 3 (38:25):
This is in January two thousand.
Speaker 2 (38:28):
Right before the fan whoops, beep.
Speaker 3 (38:33):
That's all right, Michael, take that out.
Speaker 4 (38:36):
But what's interesting, and this is January two thousand. Now,
things were already starting boiling two thousand and seven with
a subprime crisis, right, and so January two thousand and eight,
and this is what was coming down the pipeline and
the lower end estimates at that point in time, I
think we're around fourteen hundred. So there was growth across
the board from the different investment firms, some lower than others,
(39:00):
some much higher. But it sounds awfully familiar. And not
to say that last recession is going to be because
every recession is different, but it sounds awfully familiar to
some of the rhetoric and narrative that we're that we're
seeing and reading right now, either watching TV or.
Speaker 3 (39:16):
Or on on online or on your phones. Is cutting rates.
Speaker 4 (39:22):
Oh, and that's gonna help spur because once they cut rates,
then no, if you look at history, when the Feds
pause and then they start cutting rates, more times than not,
what happens the stock market comes down and then at
some point, once a once a rate cutting hits a
bottom and they're like, okay, we've cut rates as much
as we needed to. Then the market starts bouncing up
from that point.
Speaker 2 (39:42):
And you got to really digest why they're cutting rates. So,
if the Fed is going to preemptively cut rates, it's
because they see something already broken in the economy. And
then you can't wait for that announcement to happen. It is,
it's too late. Don't procrastinate, come in for a review.
(40:07):
Let us help you rebalance and potentially protect as much
of your profit and returns as we potentially can. There
are always things that do better, you know, in different
you know situations. So when rates are going down, you know,
bonds do better than stocks. You know, private credit does
(40:28):
better than stocks. So on and so forth. It just
depends we can build portfolios that encompass all the different things,
all the different categories of investments, that are weighted based
on what's going on, based on what your goals and
objectives are, based on the rates of returns that you need,
not just some pie in the sky thing where you
(40:50):
just go, oh, stocks have been great. I'm going to
have eighty percent of my money in stocks until they're broken,
and then I go, oh, God, now I'm going to
go all into you know, cash, and then okay, then
I wait for things not to be broken, which means
they went back up again, and then I get back
out of cash and go back into the things that
already went up again. This is what a lot of
(41:12):
people do, and they do it, you know, without knowing it,
because they're using emotion instead of research. They're using emotion
instead of history. They're using emotion instead.
Speaker 3 (41:28):
Of looking at the data.
Speaker 2 (41:32):
Well yeah, I guess that could fall under research. But
the data, I mean, the writing is on the wall.
These signs were here for this previous sell off. We went,
you know, into the last couple of weeks. Joseppie and
I said it was coming, and it came. We're now
still in an area of opportunity to where you want
(41:54):
to rebalance the type of stocks that you have. You
want to rebalance out of the type of overall invests
smiths that you have into other types of investments that
do better in a in a decreasing interest rate environment,
in a decreasing inflationary environment, but more importantly one where
(42:16):
we don't know if the Fed blows it again, and
we think they will. We think this these interest rate
cuts could be a mistake, and there are definitely areas
that you want to be in if those mistakes do
come to fruition. So call us at nine to one
six nine six seven thirty five hundred. There will be
(42:38):
absolutely no pressure or any obligation. We don't need more clients.
We're just fine. Do we like getting more clients, Sure,
but we just love helping people with information that we've
you know, feel we're pretty good at you know, uncovering,
especially since we've been doing this Jusepi since two thousand
(43:01):
and eight and me since nineteen ninety two in various
forms for various companies. But we've never been more passionate
than we are now, you know, doing this through our
own company, backed by some of the biggest players in
the industry, to help our retired clients have the best
chance at success, no matter what's going on. Call us
(43:22):
at nine one, six ninety six, seven thirty five hundred.
You've been listening to John Scambering to Seppe Vescani the
wise money guys. Hope you enjoyed the show. Talk to
you all later.
Speaker 3 (43:32):
Have a good weekend. Are weekend
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