October 1, 2025 • 36 mins
The U.S. government has officially entered a shutdown, raising concerns for many Americans. On this episode of The Jon Sanchez Show, Jon Sanchez and Jason Gaunt review what this development could mean for federal employees, essential services, and the broader economy. They discuss how the stock market has historically responded to past shutdowns, outlines potential effects on personal finances, and examines what investors in Reno and beyond should be aware of when it comes to wealth management Reno, retirement planning, and portfolio considerations.
👉 Watch this episode on YouTube: www.youtube.com/@thejonsanchezshow
👉 To learn more about retirement planning and wealth management in Reno, visit: sanchezgaunt.com
Compliance Disclosure: This program is for informational purposes only and should not be considered investment, tax, or legal advice. The views expressed are those of the participants and may not reflect the views of Sanchez Gaunt Capital Management. Investing involves risk, including the possible loss of principal. Past performance is not indicative of future results. Always consult with a qualified financial professional regarding your individual situation before making financial decisions.
👉 Watch this episode on YouTube: www.youtube.com/@thejonsanchezshow
👉 To learn more about retirement planning and wealth management in Reno, visit: sanchezgaunt.com
Compliance Disclosure: This program is for informational purposes only and should not be considered investment, tax, or legal advice. The views expressed are those of the participants and may not reflect the views of Sanchez Gaunt Capital Management. Investing involves risk, including the possible loss of principal. Past performance is not indicative of future results. Always consult with a qualified financial professional regarding your individual situation before making financial decisions.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Or maybe we don't.
Speaker 2 (00:04):
Good Wednesday afternoon, Welcome to the John Sanchez Show on
News Talk seven eighty k H. I am so sorry
for that, but Jason just did one of his little
little funny jokes right right at the intro. There, good
good timing, good time. But I needed that though. I'll
just tell you why I have to move one chord
or I have to move a chord from one computer
(00:26):
to another prior to the start of the show, because
again we're, you know, recording on live video, and I've
got a loose chord somewhere and I go to do
it and it doesn't happen all the time, just periodically,
and sure enough, it did it again today and I'm
literally as the intro music's playing, my computer is dead
and I'm trying frantically to get everything in front of me,
(00:46):
and Jason's like, so, why don't we just get a
new chord? We can afford to do that.
Speaker 1 (00:53):
But anyway, with the shutdown today, maybe.
Speaker 2 (00:55):
You know, you know what exactly exactly, You just never
know what can happen. How are you, my friend?
Speaker 3 (01:02):
I'm doing okay, you know, busy day, but lots to
talk about it seems lots to talk about.
Speaker 2 (01:07):
Very much, so very very much. So let me tell
you exactly what Jason is referring to. What does the
government shut down mean for you and your finances? That's
going to be our topic after we go through the
market reaction to the government shut down today. You know, yesterday,
if you missed our show, please pick up our podcast,
because the boys and I went through with the government
shut down, and obviously we didn't know at that point
(01:28):
yesterday if we're going to have it. It looked like it,
and sure enough it did shut down at midnight last night.
But what was the impact on the real estate or
what could be the impact on the real estate. Well,
now that we have the shutdown in full force, now
we got to be talking about your pocketbook. How's it
going to impact that? How's it going to impact the
stock market? Those of you that are government workers, and
(01:48):
so on and so forth. Because you know, Jason, I
hate saying this, and I was hesitating before the show started,
before my computer died on me whether I was gonna
bring this up. And I'm going to do it anyways,
and that is I hate that saying on Wall Street
that you know, history repeats itself, But this time could
be different, right, Yeah, And you're hearing that a lot
about this government shut down, that this time could be different,
(02:10):
meaning it could be longer than what Mini are anticipating.
Mini and obviously the way the stock market reacted today,
and you're like, h this is probably gonna pass and
you know, a couple of days, maybe a week or something.
Latest indications. Don't know about you, latest indications I'm seeing
right now. They're they're saying about two weeks is about
the length of time. I don't know if you've seen
anything different on that side of.
Speaker 3 (02:28):
It, similar yep, yeah, absolutely, And and you know the
tough part is the markets saying, you know, the government
being closed, how does it affect Pfizer, right, how does
it affect Costco? And and that's where at least near
term reacting for the sake of reacting, having that we've
(02:48):
seen this so many times it's been proven to be futile.
But also at the same time, what's valuation? How are
investors positioned? To your point, could this time be different?
Is this really going to be the one where both
sides stay firm over whatever thing they've decided is the
most important thing to them. And this goes longer than
(03:09):
we expect, and then the market will react to it
because it'll throw a hissy fit of some kind, and
then all of a sudden things will get fixed. So it's
just almost like you know, waiting for the whites of
their eyes before you do something dramatic exactly account because and.
Speaker 2 (03:26):
When say the market throw is a hissy fit, I
mean literally, folks. That's especially if you're new to the market.
The market will do that. It'll get to a point,
and who knows where that breaking point is, whether it's
a week, two weeks, two months, who knows, but mark
will get to a point where like, okay, guys, meaning
Washington guys and gals, enough is enough, right we I mean,
we already aren't getting nonfarm payable numbers on Friday. That's
a very very important economic report to everybody. But imagine
(03:48):
if we went two or three months without receiving that
along with other important government data that we make our
investment decisions on. Yeah, then the market could go meaning
they're going to sell, right, they would start selling this
thing off. That would get the politicians' attention and get
things moving. But I loved I get to say a
kind of an interesting thing. My wife and I were
talking about this last night and I saw it on
CNBC this morning, and I love this the I forget
(04:12):
who the senator was, but he was a Democrat. The
CNBC host said, so, governor or, senator, you know, there's
roughly eight hundred thousand, you know, government workers that are
going to be furloughed, you know, during this this shutdown,
and they're not going to get paid until they get
back to work. And as I was reading, Jason, you know,
(04:33):
going back to is we'll discuss the last large government shutdown.
It was thirty five days when Trump was in office. Before.
It's not like you come back and there's you know,
the day you show back up to work, your paycheck's
deposited in your bank account. They had to wait about
a month, meaning the government workers to get paid, right.
Speaker 1 (04:50):
Yeah.
Speaker 2 (04:51):
It created a lot of problems. People were falling behind,
you know, miss the mortgage payments. I mean, we all
know people live paycheck to paycheck. But back to the point,
so the CNBC host says, so, senator, uh, you know,
you got these roughly eight hundred people that aren't going
to get their paycheck. Eight hundred thousand are the members
of Congress getting paid and he just dodged the question completely.
(05:13):
So they're so somehow getting their paycheck, or at least yeah,
they are, they weren't.
Speaker 3 (05:17):
Yeah, the guy from Vermont was on this morning. He
said that he was not going to take a paycheck.
Speaker 2 (05:21):
That was the one that was Yes, he did say
he was going to Yeah, right again, but I will
read a book later.
Speaker 1 (05:30):
Yeah, but it is.
Speaker 3 (05:32):
It's it's a sea of unknown. And I think near term,
the market reacted to a weaker than expected ADP number
today in the sense that hey, the Fed will come
to our rescue and continue to lower rates, and that's
why we saw the market react the way it did today.
But sans bad news that equals good news tomorrow the
(05:54):
next day, et cetera.
Speaker 1 (05:55):
I don't think it'll react the same way.
Speaker 2 (05:57):
Well, we were pretty negative in the pre market session.
I mean, looking at my nose my first update at
five twenty three this morning, with the rosso we were
down one hundred and fifty six on the Dow features
you know, and are we closing record territory? Not by
much forty three points, but but it did again start
to start to weaken a bit, and it kind of
spent most of the pre market right there, right around
that negative one thirty to one fifty range. So it
was it was I think it was testing the waters
(06:18):
a little bit to see if the bears would come
out of hibernation and start driving things a little bit lower.
Speaker 3 (06:24):
Yeah, and again I think it's rates, right. I think
that the fact that bonds moved the way they did
and at weaker negative jobs number for ADP, which I
know is your favorite statistically. Yeah, it's incredibly accurate, like throwing,
like throwing water melons. Yeah, but it's it's at least
was I think the one of the catalysts that at
(06:46):
least had folks thinking that, Okay, well the Fed will
always be there over the next month or so to
bail things out by continuing to lower rates.
Speaker 2 (06:55):
Right. Absolutely, all right, So we're going to go through
the stock market recap again and it was a good
day to day record set today for the down the SMP.
But first thing we're going to start to show with
after we go through the market side of the thing
is how has the market historically reacted in previous government shutdown.
So we've got some stats for you we want to share.
I know a lot of you are concerned like, oh boy,
you know I need to take defensive action in my portfolio. Well, again,
(07:17):
as I said a moment ago, yeah, is history going
to repeat itself? Meaning the market's not going to go
down or as summer saint, is it different this time?
And then we're going to get into your personal side
of life as far as what you need to be
doing with your portfolio, because you know it is it's
a it's a and especially if you are, you know,
a government worker furloughed or a contractor to the government,
where you know you're not forur load, you're just you know,
(07:37):
you're not working, you're not getting a paycheck in some cases. Yeah,
everybody's situation is a little bit different. So what's taken
away on that, my friend, And let's let's go back
and recap exactly in some details what happened today.
Speaker 3 (07:48):
Yeah, I mean, I think that big sector of the
S and P healthcare helped quite a bit. Pfizer, Strong Lily, Thermo, Fisher, Biogen. Yeah,
those names all did quite well, six to ten percent
higher across the board. That helped the S and P
quite a bit. Why you see, it was stronger than
the Dow just because there's not as many healthcare constituents
(08:11):
inside of there. But I do I very much take
away think that the fact that ADP that came in
with a loss of thirty two thousand jobs versus an
expectation of plus forty thousand and a broadly inline PMI
which didn't at least strike itself as two inflationary, was
(08:31):
at least the mix of good enough to have the
market stare through any concern near term about what the
government's doing. Fixes at sixteen, so we're at neutral. We're
not complacent, but we're certainly not freaked out about anything.
So I think that's a notable takeaway that the market's
(08:51):
not pricing in any sort of panic right now, which
it has on other shutdowns. And sometimes that's smart to
at least see where the better are betting. And if
you don't see a VIX at twenty or twenty two,
that probably at least means that odds are near term
nothing to freak out about. Again, I can talk about
both sides of my mouth and say, sometimes the right
(09:13):
time to freak out is when no one's freaking out,
so that'll be one to watch too. So watching volatility,
I'm going to be squarely focused on and you know,
overseas markets, European markets were up, you know, eighty to
ninety basis points.
Speaker 1 (09:26):
Asia was stronger.
Speaker 3 (09:27):
So people are just rotating, right and continuing to rotate
sort of as we've seen throughout the year, away from US,
and it doesn't hurt you to do so. So I
think that's a lot of at least near term, while
the market says, hey, I can go other places and
then come back to the US once things calm down
a little bit.
Speaker 2 (09:44):
There you go, there you go. Let's go back to
the healthcare sector and give you a little bit more
details because I did not get a chance to really
discuss this much yesterday, but you know, some of you
may have seen this or heard about this before that.
Yesterday the President announced what's called Trump which is a
government run platform to lower drug costs. Now, under this
(10:04):
initiative of Pfizer, as Jason just mentioned, has agreed to
reduce their medicaid prices and invest seventy billion dollars in
US R and D in exchange for a three year
tariff reprieve. So that stock again had a very strong days.
Jason alluded to six point eight nine percent gain up
a dollars seventy six to twenty seven twenty three. So
you know, we'll see if at that uh you know, exciting, yeah,
(10:31):
wears off here, you know going forward, or this may
be you know, because the healthcare obviously has lagged significantly
this year, you know, be able to move things around.
Lily was another big move. I was looking at the quotes,
you know, eight point two two percent gaining up sixty
two dollars and seventy one cents eight twenty five seventy
one Thermo Fisher, nine and a half percent gain. Biotech.
(10:54):
It was in our biogen excuse me, up ten point
zero nine percent, So once again the whole sector was strong.
Now also helping it out today Nike, right, surprise everybody,
this company has just really turned things around with new management.
Dow component the reporter journeys after the close yesterday, Brady
get numbers across the board stock row six point four
to six percent, four dollars and fifty cent rise to
seventy four to twenty four again to help the dow out.
Speaker 1 (11:17):
Yeah, real quick, real quick. Sorry.
Speaker 3 (11:18):
With healthcare, if you're looking at the healthcare sector, I'm
looking at the ETF that tracks it right now, it's
about eight point three percent. It still has before it
gets back to its highs. Right, So, if the S
and p's trade in its highes and you're trying to
play some relative games, healthcare could be a good spot.
We've talked about biotech, et cetera, but healthcare has got
(11:39):
a lot of room to the upside if in fact,
you're thinking that you see some rotation versus your tech
sectors and things like that that are very much overbought
and at their high So that's a decent reason why,
you know, you avoid a sector and all of a
sudden you miss a big, big move in trying to
you know, at least be overly weighted to momentum, and.
Speaker 2 (12:03):
Hence again the reason for a diversified portfolio. A little
bit of a little bit, of a little bit of
a lot, as the saying goes. And let's wrap it
up with Jason with Tesla strong day to day fourteen
dollars sixty nine cent, game three point three percent, closed
at four fifty nine forty one. They're gonna be reporting
deliveries tomorrow for the third quarter. Mini analysts are expecting
that to be a very strong number. So that'd be
(12:24):
a nice little turn around if that happens. So stuck
bit up ahead of that. All right, we come back,
we'll hit the commodities real quick, interest rates, et cetera.
Then we're going to get into, first of all, how
has the market performed historically when we are in a
government shutdown. Then we're going to get into many details
our shutdown checklist, et cetera. But first let's turn it
to Kristin Snow. She's in the right now traffic center. Hello, Kristen,
(12:48):
Welcome back to the John Sanchez Show on Newstalk seven
to eighty ko H with Jason Gatt. Once again, we
finished up forty three on the Dow. That was a
close of forty six thousand four to forty one, again
a record finish. Now as I hired by ninety five
point four to two percent to a close of twenty
two seven fifty five s and p up twenty three
points point three four percent to a level of six
thy seventy eleven, also a record closed there. All right,
(13:10):
on the commodity side, we finished down fifty eight cents
on oil, sixty one seventy nine at barrel. I'm just
waiting to I can say fifty something on oil chase.
Speaker 1 (13:17):
Did it get there today?
Speaker 2 (13:19):
I don't heed n to day, I don't. Yeah, enter day,
I got to pull up a chart. But twenty four
to forty gain twenty four dollars and forty cent gain
in gold, she's on a tear. Three thousand and eight
ninety seven eighty an ounces are closing level there and
over to the bottom market side of things, down four
basis points on the tenure to what four point one
percent close on that. I'm like, guess, just getting getting
(13:42):
attractive there. But you know it's poor poor Dwight said,
you know what goods are going to do? You can't
get any mortgages done right now because the government shut down.
So he was he was a little frustrated yesterday. He
didn't say it, but you could see it in his face.
He was, you know, I don't blame I mean anybody
you know it's being affected by that. It's like I
can't get tax cut transfer. And then there's some government
entities open that he deals with and some that are closed.
(14:03):
And yeah, yeah, he texted me this morning, He's like
this is just not good, not fun, all right, So
let's get down to our topic this afternoon, which again
is what does the government shut down mean for you
in your portfolio, your personal life, et cetera. So we
want to start off with a I'll call it a
big misconception because again I had this discussion with a
(14:26):
client about an hour or so ago, and they, you know,
people think that the market is always going to sell
off in a government shutdown. And I think, Jason, you
and I went through some of these numbers, I don't know,
two or three weeks ago. I mean, it was a
while back, but it's a good time to kind of
refresh everybody. So let's go back to the last major
government shutdown. So, as I said earlier, that was back
(14:50):
from the period of December twenty first of twenty eighteen
through January twenty fifth of twenty nineteen. Okay, so it
was about thirty five days overall. But well, we care
about our trading days. So it's twenty two trading days.
The average return on the SMP five hundred on a
day by day basis point four seven percent. Then amazing,
(15:14):
it was half a percent average on the SMP five vetter.
But if we tally up those twenty two trading days,
when the government was shut down ten point four to
three percent return. It's not bad, my friend.
Speaker 1 (15:26):
That's market likes it when they're closed.
Speaker 2 (15:29):
That's exactly it. That's exactly it. Let's go back to
earlier in twenty eighteen. I'd actually until I dug up
this data, I actually forgot we had to those shutdowns
in twenty eighteen. January nineteenth of twenty eighteen through January
twenty second of twenty eighteen, there's only two trading days
there Mark SMP rose point eight one percent ninety five.
(15:52):
We had five trading days during the shutdown, there a
one point three six percent gain ninety five. We had
fourteen trading day closed for fourteen trading days is the
fraction of a percent. And then in twenty thirteen that
wasn't bad, close for fourteen days and up three point
one seven percent, so you know, and then again those
are trading days. So overall market, like you said, doesn't
(16:13):
mind take it away? Why is in the market mind?
Then the government shut down?
Speaker 3 (16:17):
Well, I mean again, I think it's probably just circumspect.
A lot of times it sells off into it too, right,
and then sort of the buy the news, sell the
rumor or whatever.
Speaker 1 (16:29):
The heck you want to call it.
Speaker 3 (16:30):
I think that's part of the reasons too, righte that
you know, people start to expect the worst, and then
when it doesn't happen, as they're getting slowly more excitement
that something is going to get cured, you tend to
see strength on the way out. So I think that's
a lot of what we're seeing. And again I don't
(16:51):
think near term it matters a whole heck of a
lot as far as company earnings are concerned.
Speaker 1 (16:55):
Right maybe.
Speaker 3 (16:58):
A palanteer for example, and that there's a way out
right field shot there. But you know, who gets a
lot of their income from the government over time could
really suffer because that's lots of days they don't get paid.
But you know, does Walmart really matter if the government
shot like does it? I'm sure you could make some
bank shots as to why it will hurt them marginally,
but it doesn't really affect their business.
Speaker 2 (17:20):
It's just well, I think we saw a little bit
of that today. You saw the banks a bit weak.
Jimp Morgan's second worst perform home Depot was the worst
performer of the down down little R eight bucks. There
are some strategists out there that are going. You know,
if this thing extends for any period of time. Again,
as I said at the beginning of the show, you've
(17:41):
got government workers, contractors and whoever else may be impacted
by a long term quasi long term government shutdown. They
don't have the consumer discretionary funds now to go to
a home depot or borrow money from a JP Morgan
or something like that. So there's always that school without.
Speaker 1 (17:58):
Also, no, that's fair, that's some.
Speaker 3 (18:00):
I mean, I forget the number that we saw the
people that worked for the FED, right, some astronomical number,
but there's clearly a lot of folks. But remember everyone
doesn't get laid off to you know, or furloughed quote unquote,
like it's just a get a matter of how sensitive
and how long it ends up being. I was surprised
by that ten percent number. I know that you gave
(18:22):
there too, but yeah, it's.
Speaker 1 (18:23):
It it until it becomes a big deal.
Speaker 3 (18:27):
This just seems like the same old thing that we
always deal with with these you know, not my favorite
group of people.
Speaker 2 (18:35):
Yeah, I felt stupid this morning. Russ and I were
talking about was doing the stock up dates, and I said, yeah,
tomorrow or you're working to have this again. We don't
have the non front paerial numbers on Friday, and I went, actually, Russ,
I don't know what we're gonna have tomorrow, right because
other than ADP, I can't think of really any report
off the top of my head that we get that
doesn't have the government, you know, claws into it in
(18:56):
some form or fashion. So we may not get anything.
I mean, we got a pretty good calendar tomorrow, but again,
may not get anything. And once again, how long can
that go on? So there's a lot of reasons, but
the most important takeaway of this segment is the market. Again.
We tested it for you know, thirty five days, twenty
two trading days, and that last shutdown that was the
longest one, and the market did just fine. Again, says
(19:16):
open the show with could this time beterre? For only
time will tell now when we come back. Here's one
other thing that we got to be thinking about, as
far as your portfolios and so on and so forth,
and that is the president's comments today in some economic
as well as political strategists saying that he will use
and he made some comments out as pre secretary made
some comments in the White House just a few hours
(19:37):
ago indicating guess what, it may not just be the furloughs.
They could be using this as an excuse quote quote
air quotes to permanently rid the government of hundreds of
thousands of jobs. That's a whole different story there. So
we'll cover that as we continue talking about what is
this government shut down in near the market to your portfolio,
your personal life. Turned over to Jack Samon he's got news, traffic,
(19:57):
and weather. Hello, Jack, Welcome back to the John Sanchez
Show on News Talk seven eighty k O waits with
Jason Gount once again. We finished up forty three on
the Dow at a ninety five point gain on the
Nasdaq and a twenty two point rise on the S
and P five hundred, again, a record closed for the
Dow and the S and P five hundred. All right, now,
we just went over how the market historically reacts and
a government shut down again, government shut down at midnight
(20:20):
last night. Today was our first day. Obviously, the market
didn't care too much about it, and we just shared
with you once again that last government shut down lasting
thirty five days calendar days, twenty two trading days. We
gained a little over ten percent average or a little
over ten percent over that twenty two days of trading.
But now again, is this time going to be different?
What do you need to be doing thinking about for
(20:41):
your portfolio, et cetera. So let's I want to kind
of go back to some of the basics here. You know,
I've been talking to a lot of people today, Jason,
and they're like, what really, you know, what really is
behind this? Trying to get an idea how long this
thing is going to last. So we're not a political show,
so I'm not going to you know, point fingers one
way or the other. But you know, in summary, basically
(21:03):
what the problem is, the Democrats have remained very very united.
We needed five more of their votes to get this passed, right,
to get the budget passed, Well, we missed it. They
tried voting again this morning, I guess, and missed it again.
So I don't think they're real far off, but you know,
only time will tell. But what they're trying to do
is they're trying to get a funding building near the
Democrats to go through only if it includes some policy
(21:27):
changes that they want. Now what are these policy changes?
So their primary but again it's not the only demand
has been to have subsidies for healthcare plans through Obamacare
extended before they expire at the end of this year.
Now Republicans have said no, sorry, no way, Oh it's
not going to happen. They've refused to concede, and that,
of course is why we are now in a government
(21:49):
shut down with you know, really no end in sight.
So it's coming down to the healthcare side of things.
I know the list is a mile long for other reasons,
but you know, if you kind of just focus on that,
say okay, and you know, Jason's kind of remarkable. Again
we're talking about how strong the healthcare center was today
and here it's kind of at the crux of the problem,
and healthcare is one of the best performers today. But
(22:10):
you know, on a light note, though, I want all
of you to rest assure that there's going to be
one aspect or one area of the White House that
is not going to be slowing down. You want to
take a shot at what that maybe.
Speaker 1 (22:21):
Jason, no, no, I'm excited.
Speaker 2 (22:23):
Tell me, well, we no longer have a rose garden.
Oh yes. The President of course has now broken ground
on his new ballroom. So for those that may have
been concerned that there may be a delay in the ballroom.
According to the White House Today quote, there will not
be a stoppage of ballroom work when the shutdown occurs. Now,
(22:47):
what's this ballroom? Well, Trump signed an executive order not
too long ago, back in July calling for the construction
in the beautiful Rose Garden of a ninety thousand square
foot ordinately designed and carefully often event space that could
host as many as six hundred and fifty guests. Kind
of cool. It's like having your own convention center right
out your front door. Yeah, the renderings that have been
(23:10):
released suggest that the ballroom is going to dwarf the
White House in size. But why isn't you know this
is government property. Why isn't the construction stopping there? Well,
because the funds for the ballroom reportedly have come from
private donors and are not tied to the budget stand off,
that again is affecting the rest of the government.
Speaker 1 (23:28):
So can we can we talk about that?
Speaker 2 (23:30):
Still?
Speaker 1 (23:30):
It private? Private donors?
Speaker 2 (23:32):
Private donors?
Speaker 1 (23:33):
What's that mean?
Speaker 2 (23:34):
Private donors? Right?
Speaker 3 (23:38):
So, private donors are donating to build a ballroom for
the Trump Ballroom or whatever it's going to be called.
Speaker 2 (23:47):
Got it?
Speaker 1 (23:48):
And that's totally on the end.
Speaker 2 (23:49):
That's the same group that you know donated. You know,
I'm sure it's I don't know who the donors are,
but I'm speculating a lot of the same multi billionaires, corporations,
et cetera that don't massive amounts to the campaign. Okay, yeah,
that's my I'm sure at some point we'll find out
who the donors are. But yeah, that's that's why. You Yeah,
(24:14):
they just give them a brick, like a you and R.
You can buy a brick, you know when they do
new constructions.
Speaker 1 (24:19):
Brick for five billion dollars. That's it's interesting.
Speaker 3 (24:25):
It just reminds me of like, you know what I
see from like oligarchs of the past, right, like these opulence, right,
all the gold and whether it was like gold that
was bought a peer one or whatever. But like it's
it's all this like gold. It's just I don't, I
don't know. It's that's the part I find very interesting,
(24:47):
like them or not. I like, you know, trying to
change the view of the role or something as president, right,
it's it's it's it's gone cyclical, right, where some president
try to be more man of the people and others
to move other directions.
Speaker 2 (25:04):
It's still a podcast on that. So we got a podcast.
Invite all of you to go to our podcasting site,
Podcasters of America. We recorded a great podcast with doctor
Sanchez on Monday on AI. We really turned out to
be an hour and a half podcasts, but great, great
information there. Now, when can we expect the next vote?
It's not going to happen tomorrow. Senators are off tomorrow
(25:25):
for jan Kipper, so no meeting is going to happen.
Then they're going to come back on Friday and Saturday
for continuing negotiations and potentially more voting. So we've got
a couple days where nothing's going to happen. As I
told you before we went to break, here's the other
issue that at some point, especially when we if it
comes a fruition again, everything is fluid right now. If
it comes to fruition, this could spark a little bit
(25:48):
of nervousness in the market. Today, the President's budget chief
of Russell Woutz told House Republicans that the administration will
start firing federal employees. I didn't say furlough, I said
firing federal employees in the next one to two days.
That's according to NBC News. Meanwhile, we, like I said,
(26:09):
not long before the show, Press Secretary Carolyn Levitt, of course,
she confirmed the layoffs are quote imminent.
Speaker 1 (26:18):
Wow, these lines are amazing. A lot of good can
come from shutdowns.
Speaker 2 (26:21):
Trump's yeah, let me get to that's that's the best
place in President's quote his cabinet. I will yeah, yeah.
So this is a first quote. The President has directed
his cabinet and the Office of Management and Budge Jason's
like rubbing his neck right now. It's stressing them out
with this. The President has directed his cabinet and the
Office of Management and Budget that they are working with
(26:42):
agencies across the board to identify workcuts can be made.
Told the reporters, and we believe that layoffs are imminent now.
Prior to the shutdown, that Vout issued a memo that
threatened mass firings. Again, folks, I'm not saying furloughs. I'm
saying firings. Threatened mass firings, writing that fell agencies would
be directed to consider quote reduction in force notices for
(27:07):
all employees in defunded programs, projects, or activities not deemed
quote consistent with the president's priorities. Okay, now that's what
mister Gaunt was saying in a moment ago at a
White House of eight yesterday, the President framed the shutdown
as an opportunity. So listen closely, folks to what I'm saying,
because this may be a hint that he is in
(27:29):
no hurry for this shutdown to end, So listen closely.
So he framed the shutdown as a quote opportunity to
get rid of a lot of things we didn't want,
adding that they'd be Democrat things. Don't know they'd was
a word, but they'd would be different Democrat things. Quote
from the President. A lot of good can come down
(27:49):
from shutdowns, he said, when you shut it down, you
have to do layoffs. So we'd be laying off a
lot of people that are going to be very effected.
And they're Democrats. They're going to be there there, and
they're Democrats. They're going to be Democrats. When I read that,
I sat back and I went, Okay, if I was
(28:11):
a government employee and I'm a diehard Republican, and and
but I got my department, my agency or whatever, got
you know, creamed in a permanent shutdown, how do you
know that they're all Democrats. They're you know, he calls
them Democrat departments that I don't understand how Yeah, but
(28:31):
this scares me, Jason. I mean, we don't know the size.
I mean, I've seen some some guestimates that it could
be a couple hundred thousand people permanently after this furlough ends,
or simultaneously a couple hundred thousand people permanently have lost
their government job.
Speaker 3 (28:45):
Yeah, I mean I think that's spot on of it.
I don't think there's just like I mean, I guess
we could probably riff on what areas we think are
just full of Democrats as far as government agencies. But
you know, I mean sort of in line with a
lot of people who push back against black Rock, right, saying, oh,
you know, woke and this and that, and you know,
(29:06):
I'm like safe to say the biggest financial institution, at
least on the money management side, is not all Democrats.
Speaker 1 (29:14):
Right, So it's you could.
Speaker 3 (29:17):
Certainly have some baby right, a lot of conservative you know,
but you could see some baby with the bathwater type
stuff for sure. But I mean again, it's if you're Trump,
that's just threatening saying look, fine, you can drag your feet.
I'm just gonna fire a bunch of your people until
the point that they all get really sad and then
(29:37):
come yelling and crying to you, and then you have
to backpedal.
Speaker 2 (29:40):
So well, yesterday, it's a negotiating tactics, for sure, it is.
That's why I'm bringing this up. We don't know how
much of it's true. My gut tells me it's not
a threat. I have a feeling he's going to do it. Right.
We saw what happened with those when Musk was there. Right,
they don't hesitate to get rid of a couple thousand people.
So if he can look at it that way, doesn't
(30:03):
My heart tells me I think it's very very true.
I'm going to tell you what two labor unions just
did yesterday that represent the federal workers. They're taking it
very serious. All right, how this government shutdown is affecting you.
We'll come back and continue that discussion. Let's wrap it
up with Kristen Snow right now Traffic Center. Hello, Kristen,
welcome back to the John Sanchez Show on Newstalk seven
(30:24):
to eighty k which with Jason Gun once again. We
finished up forty three on the Dow twenty ninety five
point gain. I'm then NASDAC and up twenty three on
the SMP. Once again, our record closed for the Dow
and the S and P five hunder. All right, we've
been discussing what the government shutdown means for you and
your finances. Once again, from the stock market perspective, don't
change anything based upon your assumption of the government shutdown. Again,
(30:44):
historically the market does just find at least at this point. Obviously,
you need to tune into the show every day and
we'll keep you updated if things change. Now, what we're
talking about is something that could be a little bit
of the flying the ointment, and that is what the
President said yesterday, where you know they're proposing permanently getting
rid of hundreds of thousands is what this I've seen.
I don't know how accurate that is, but a whole
(31:06):
bunch of people permanently using the government shut down as
basically the excuse. Now, I told you that a couple
of labor unions are getting involved. Before I do that,
I want to tell you what some of the critics
of this threat by the president, if it is a
threat not something of reality. A couple of the critics
are accused of the administration of using the shutdown as
(31:28):
a pretext for the cuts that he wanted to make. Anyways,
this is according to the Progressive Center of Budget and
Policy Priorities. They said, look at a shutdown provides no
new legal authority to engage in mass layoffs, nor does
it provide any sound management or policy reason to do so. So,
now let's go back to the labor union Jason So.
On Tuesday, two labor unions that represent federal workers sue
(31:51):
the administration over its mass layoff threats. Now, the lawsuit
accused the White House of the quote cynical use of
federal employees as a pawn in congressional congressional deliberations, noting
that under the current law quote, all employees who are
not paid during a shutdown, whether furloughed or accepted, must
receive back pay for that time period once the funding
(32:12):
is reinstated. In response, Republicans have argued that the White
House can fire whoever it wants during a shutdown. According
to Mike Johnson, he said the following, of course, the speaker,
it provides an opportunity and he left it at down.
It provides an opportunity, So you see what I'm saying.
We again, this is the fun part with Trump. You
try to read in between the lines and you go, okay.
The Speaker of the House is saying it provides an opportunity.
(32:34):
Trump saying, you know every person wants to get rid of.
Is this going to be a Democrat? Which we know
that's not true. So this is something we have to
watch because I met my bottom dollar. If tomorrow we
wake up and I'm just gonna do a hypothetical one
hundred couple hundred thousand layoffs or elimination of positions are announced,
it's going to have an impact on the market after
today's week.
Speaker 1 (32:56):
Couldn't he do it anyway?
Speaker 2 (32:57):
Like why, Well, that's what that's what the that's kind
of what they're saying, that he can under executive authority,
he can like they said the White House said he
can fire whoever it wants during his shutdown, but they
said during a shutdown. So I don't know. According to
the labor Union, that's why they filed the lawsuits yesterday.
He can't just do it whether it's in a government
(33:17):
shutdown or not. So I don't know the answer to that,
but all he has to do is create a executive order,
which maybe already has and one of the many hundreds
or thousands that he can't. I don't know. It's just
starting to find its way into the newswires at this point.
So latest number, seven hundred and fifty thousand government employees
(33:38):
are going to be furloughed. Here's another interesting economic statistic
also that last shutdown I was mentioning back in twenty
eighteen and twenty nineteen, for thirty five days, it costs
the government four hundred million dollars in wages per day
according to the CBO, which okay, but I saw a
bigger statistic yesterday that it impacts one tenth of GDP.
(34:00):
For every day the government has shut down, the GDP
has to be reduced by one tenth of a percent
per week. So can you have an overall economic impact? Right?
And again back to looking at the overall economy.
Speaker 3 (34:11):
Yeah, fed cutting rates, right, so maybe job closures get
you even more rate cuts.
Speaker 2 (34:15):
That's right, and that's what many I thought about that. Also,
again back to the president just trying to read it
in between the lines. Maybe he's not in a hurry
to get this shut down over with. Because again it'll
weaken the jobs market more. He'll have more ammunition to
point fingers at the Fed to say another, don't give
me a quarter percent cut or give the economy give
it a half Right, look at the jobs market's a mess. Now,
(34:36):
we're losing hundreds of thousands of jobs, right didn that
makes sense.
Speaker 1 (34:39):
To all watch Democrats causing all this riff.
Speaker 2 (34:41):
Strife exactly got it. Of the APA staff is out
of work during the shutdown, about five percent of the
Department of Homeland compared to just five percent of the
Department of Homeland Security workers that are being furloughed. CNN
reported today All so that the Small Business Administration sent
(35:02):
quote suggested language for workers, not about you, because you
always send a out of when you're out of office,
you send that you put up that email. So the
Small Business Association sent a suggested language for workers to
use and they're out of office messages quote, I am
out of the office for the foreseeable future because the
Senate Democrats voted to block a clean federal funding bill,
leading to a government shut down. The language reads over
(35:24):
at the Housing and Urban Development Department UH, the EPA,
and the Department of veteran affairs. Their email says, quote
radical left, congressional Democrats and radical liberals respectively. That's the
reason makes sense. Yeah, that they're out of office.
Speaker 3 (35:39):
So I'm going to change my out of office. For
next time, something will be radical.
Speaker 1 (35:43):
I promise.
Speaker 2 (35:44):
There you go, John, John Radical. I'm out, all right,
my friend, great job as always. We'll do it again tomorrow.
The John Sanchez showed, don't miss it. Take care. John
Sanchez is a registered investment advisor, and the opinions expressed
by Sanchez Gone Capital Management, LLC on this show or
their own and do not reflect the opinions of News
Talks seven eighty or its pairing company, Cumulus Media. All
(36:07):
statements and opinions expressed are based upon information considered reliable,
although it should not be relied upon. As such, any
statements or opinions are subject to change without notice. Information
presented is for educational purposes only and does not intend
to make an offer or solicitation for the sale or
purchase of any specific securities, investments, or investment strategies. Investments
(36:29):
involve risk, and, unless otherwise stated or are not guaranteed.
Information expressed does not take into account your specific situation
or objectives, and is not intended as recommendations appropriate for
any individual. Listeners are encouraged to seek advice from a
qualified tax, legal, or investment advisor to determine whether any
information presented may be suitable for their specific situation. Past
(36:51):
performance is not indicative of future performance.
Or maybe we don't.
Speaker 2 (00:04):
Good Wednesday afternoon, Welcome to the John Sanchez Show on
News Talk seven eighty k H. I am so sorry
for that, but Jason just did one of his little
little funny jokes right right at the intro. There, good
good timing, good time. But I needed that though. I'll
just tell you why I have to move one chord
or I have to move a chord from one computer
(00:26):
to another prior to the start of the show, because
again we're, you know, recording on live video, and I've
got a loose chord somewhere and I go to do
it and it doesn't happen all the time, just periodically,
and sure enough, it did it again today and I'm
literally as the intro music's playing, my computer is dead
and I'm trying frantically to get everything in front of me,
(00:46):
and Jason's like, so, why don't we just get a
new chord? We can afford to do that.
Speaker 1 (00:53):
But anyway, with the shutdown today, maybe.
Speaker 2 (00:55):
You know, you know what exactly exactly, You just never
know what can happen. How are you, my friend?
Speaker 3 (01:02):
I'm doing okay, you know, busy day, but lots to
talk about it seems lots to talk about.
Speaker 2 (01:07):
Very much, so very very much. So let me tell
you exactly what Jason is referring to. What does the
government shut down mean for you and your finances? That's
going to be our topic after we go through the
market reaction to the government shut down today. You know, yesterday,
if you missed our show, please pick up our podcast,
because the boys and I went through with the government
shut down, and obviously we didn't know at that point
(01:28):
yesterday if we're going to have it. It looked like it,
and sure enough it did shut down at midnight last night.
But what was the impact on the real estate or
what could be the impact on the real estate. Well,
now that we have the shutdown in full force, now
we got to be talking about your pocketbook. How's it
going to impact that? How's it going to impact the
stock market? Those of you that are government workers, and
(01:48):
so on and so forth. Because you know, Jason, I
hate saying this, and I was hesitating before the show started,
before my computer died on me whether I was gonna
bring this up. And I'm going to do it anyways,
and that is I hate that saying on Wall Street
that you know, history repeats itself, But this time could
be different, right, Yeah, And you're hearing that a lot
about this government shut down, that this time could be different,
(02:10):
meaning it could be longer than what Mini are anticipating.
Mini and obviously the way the stock market reacted today,
and you're like, h this is probably gonna pass and
you know, a couple of days, maybe a week or something.
Latest indications. Don't know about you, latest indications I'm seeing
right now. They're they're saying about two weeks is about
the length of time. I don't know if you've seen
anything different on that side of.
Speaker 3 (02:28):
It, similar yep, yeah, absolutely, And and you know the
tough part is the markets saying, you know, the government
being closed, how does it affect Pfizer, right, how does
it affect Costco? And and that's where at least near
term reacting for the sake of reacting, having that we've
(02:48):
seen this so many times it's been proven to be futile.
But also at the same time, what's valuation? How are
investors positioned? To your point, could this time be different?
Is this really going to be the one where both
sides stay firm over whatever thing they've decided is the
most important thing to them. And this goes longer than
(03:09):
we expect, and then the market will react to it
because it'll throw a hissy fit of some kind, and
then all of a sudden things will get fixed. So it's
just almost like you know, waiting for the whites of
their eyes before you do something dramatic exactly account because and.
Speaker 2 (03:26):
When say the market throw is a hissy fit, I
mean literally, folks. That's especially if you're new to the market.
The market will do that. It'll get to a point,
and who knows where that breaking point is, whether it's
a week, two weeks, two months, who knows, but mark
will get to a point where like, okay, guys, meaning
Washington guys and gals, enough is enough, right we I mean,
we already aren't getting nonfarm payable numbers on Friday. That's
a very very important economic report to everybody. But imagine
(03:48):
if we went two or three months without receiving that
along with other important government data that we make our
investment decisions on. Yeah, then the market could go meaning
they're going to sell, right, they would start selling this
thing off. That would get the politicians' attention and get
things moving. But I loved I get to say a
kind of an interesting thing. My wife and I were
talking about this last night and I saw it on
CNBC this morning, and I love this the I forget
(04:12):
who the senator was, but he was a Democrat. The
CNBC host said, so, governor or, senator, you know, there's
roughly eight hundred thousand, you know, government workers that are
going to be furloughed, you know, during this this shutdown,
and they're not going to get paid until they get
back to work. And as I was reading, Jason, you know,
(04:33):
going back to is we'll discuss the last large government shutdown.
It was thirty five days when Trump was in office. Before.
It's not like you come back and there's you know,
the day you show back up to work, your paycheck's
deposited in your bank account. They had to wait about
a month, meaning the government workers to get paid, right.
Speaker 1 (04:50):
Yeah.
Speaker 2 (04:51):
It created a lot of problems. People were falling behind,
you know, miss the mortgage payments. I mean, we all
know people live paycheck to paycheck. But back to the point,
so the CNBC host says, so, senator, uh, you know,
you got these roughly eight hundred people that aren't going
to get their paycheck. Eight hundred thousand are the members
of Congress getting paid and he just dodged the question completely.
(05:13):
So they're so somehow getting their paycheck, or at least yeah,
they are, they weren't.
Speaker 3 (05:17):
Yeah, the guy from Vermont was on this morning. He
said that he was not going to take a paycheck.
Speaker 2 (05:21):
That was the one that was Yes, he did say
he was going to Yeah, right again, but I will
read a book later.
Speaker 1 (05:30):
Yeah, but it is.
Speaker 3 (05:32):
It's it's a sea of unknown. And I think near term,
the market reacted to a weaker than expected ADP number
today in the sense that hey, the Fed will come
to our rescue and continue to lower rates, and that's
why we saw the market react the way it did today.
But sans bad news that equals good news tomorrow the
(05:54):
next day, et cetera.
Speaker 1 (05:55):
I don't think it'll react the same way.
Speaker 2 (05:57):
Well, we were pretty negative in the pre market session.
I mean, looking at my nose my first update at
five twenty three this morning, with the rosso we were
down one hundred and fifty six on the Dow features
you know, and are we closing record territory? Not by
much forty three points, but but it did again start
to start to weaken a bit, and it kind of
spent most of the pre market right there, right around
that negative one thirty to one fifty range. So it
was it was I think it was testing the waters
(06:18):
a little bit to see if the bears would come
out of hibernation and start driving things a little bit lower.
Speaker 3 (06:24):
Yeah, and again I think it's rates, right. I think
that the fact that bonds moved the way they did
and at weaker negative jobs number for ADP, which I
know is your favorite statistically. Yeah, it's incredibly accurate, like throwing,
like throwing water melons. Yeah, but it's it's at least
was I think the one of the catalysts that at
(06:46):
least had folks thinking that, Okay, well the Fed will
always be there over the next month or so to
bail things out by continuing to lower rates.
Speaker 2 (06:55):
Right. Absolutely, all right, So we're going to go through
the stock market recap again and it was a good
day to day record set today for the down the SMP.
But first thing we're going to start to show with
after we go through the market side of the thing
is how has the market historically reacted in previous government shutdown.
So we've got some stats for you we want to share.
I know a lot of you are concerned like, oh boy,
you know I need to take defensive action in my portfolio. Well, again,
(07:17):
as I said a moment ago, yeah, is history going
to repeat itself? Meaning the market's not going to go
down or as summer saint, is it different this time?
And then we're going to get into your personal side
of life as far as what you need to be
doing with your portfolio, because you know it is it's
a it's a and especially if you are, you know,
a government worker furloughed or a contractor to the government,
where you know you're not forur load, you're just you know,
(07:37):
you're not working, you're not getting a paycheck in some cases. Yeah,
everybody's situation is a little bit different. So what's taken
away on that, my friend, And let's let's go back
and recap exactly in some details what happened today.
Speaker 3 (07:48):
Yeah, I mean, I think that big sector of the
S and P healthcare helped quite a bit. Pfizer, Strong Lily, Thermo, Fisher, Biogen. Yeah,
those names all did quite well, six to ten percent
higher across the board. That helped the S and P
quite a bit. Why you see, it was stronger than
the Dow just because there's not as many healthcare constituents
(08:11):
inside of there. But I do I very much take
away think that the fact that ADP that came in
with a loss of thirty two thousand jobs versus an
expectation of plus forty thousand and a broadly inline PMI
which didn't at least strike itself as two inflationary, was
(08:31):
at least the mix of good enough to have the
market stare through any concern near term about what the
government's doing. Fixes at sixteen, so we're at neutral. We're
not complacent, but we're certainly not freaked out about anything.
So I think that's a notable takeaway that the market's
(08:51):
not pricing in any sort of panic right now, which
it has on other shutdowns. And sometimes that's smart to
at least see where the better are betting. And if
you don't see a VIX at twenty or twenty two,
that probably at least means that odds are near term
nothing to freak out about. Again, I can talk about
both sides of my mouth and say, sometimes the right
(09:13):
time to freak out is when no one's freaking out,
so that'll be one to watch too. So watching volatility,
I'm going to be squarely focused on and you know,
overseas markets, European markets were up, you know, eighty to
ninety basis points.
Speaker 1 (09:26):
Asia was stronger.
Speaker 3 (09:27):
So people are just rotating, right and continuing to rotate
sort of as we've seen throughout the year, away from US,
and it doesn't hurt you to do so. So I
think that's a lot of at least near term, while
the market says, hey, I can go other places and
then come back to the US once things calm down
a little bit.
Speaker 2 (09:44):
There you go, there you go. Let's go back to
the healthcare sector and give you a little bit more
details because I did not get a chance to really
discuss this much yesterday, but you know, some of you
may have seen this or heard about this before that.
Yesterday the President announced what's called Trump which is a
government run platform to lower drug costs. Now, under this
(10:04):
initiative of Pfizer, as Jason just mentioned, has agreed to
reduce their medicaid prices and invest seventy billion dollars in
US R and D in exchange for a three year
tariff reprieve. So that stock again had a very strong days.
Jason alluded to six point eight nine percent gain up
a dollars seventy six to twenty seven twenty three. So
you know, we'll see if at that uh you know, exciting, yeah,
(10:31):
wears off here, you know going forward, or this may
be you know, because the healthcare obviously has lagged significantly
this year, you know, be able to move things around.
Lily was another big move. I was looking at the quotes,
you know, eight point two two percent gaining up sixty
two dollars and seventy one cents eight twenty five seventy
one Thermo Fisher, nine and a half percent gain. Biotech.
(10:54):
It was in our biogen excuse me, up ten point
zero nine percent, So once again the whole sector was strong.
Now also helping it out today Nike, right, surprise everybody,
this company has just really turned things around with new management.
Dow component the reporter journeys after the close yesterday, Brady
get numbers across the board stock row six point four
to six percent, four dollars and fifty cent rise to
seventy four to twenty four again to help the dow out.
Speaker 1 (11:17):
Yeah, real quick, real quick. Sorry.
Speaker 3 (11:18):
With healthcare, if you're looking at the healthcare sector, I'm
looking at the ETF that tracks it right now, it's
about eight point three percent. It still has before it
gets back to its highs. Right, So, if the S
and p's trade in its highes and you're trying to
play some relative games, healthcare could be a good spot.
We've talked about biotech, et cetera, but healthcare has got
(11:39):
a lot of room to the upside if in fact,
you're thinking that you see some rotation versus your tech
sectors and things like that that are very much overbought
and at their high So that's a decent reason why,
you know, you avoid a sector and all of a
sudden you miss a big, big move in trying to
you know, at least be overly weighted to momentum, and.
Speaker 2 (12:03):
Hence again the reason for a diversified portfolio. A little
bit of a little bit, of a little bit of
a lot, as the saying goes. And let's wrap it
up with Jason with Tesla strong day to day fourteen
dollars sixty nine cent, game three point three percent, closed
at four fifty nine forty one. They're gonna be reporting
deliveries tomorrow for the third quarter. Mini analysts are expecting
that to be a very strong number. So that'd be
(12:24):
a nice little turn around if that happens. So stuck
bit up ahead of that. All right, we come back,
we'll hit the commodities real quick, interest rates, et cetera.
Then we're going to get into, first of all, how
has the market performed historically when we are in a
government shutdown. Then we're going to get into many details
our shutdown checklist, et cetera. But first let's turn it
to Kristin Snow. She's in the right now traffic center. Hello, Kristen,
(12:48):
Welcome back to the John Sanchez Show on Newstalk seven
to eighty ko H with Jason Gatt. Once again, we
finished up forty three on the Dow. That was a
close of forty six thousand four to forty one, again
a record finish. Now as I hired by ninety five
point four to two percent to a close of twenty
two seven fifty five s and p up twenty three
points point three four percent to a level of six
thy seventy eleven, also a record closed there. All right,
(13:10):
on the commodity side, we finished down fifty eight cents
on oil, sixty one seventy nine at barrel. I'm just
waiting to I can say fifty something on oil chase.
Speaker 1 (13:17):
Did it get there today?
Speaker 2 (13:19):
I don't heed n to day, I don't. Yeah, enter day,
I got to pull up a chart. But twenty four
to forty gain twenty four dollars and forty cent gain
in gold, she's on a tear. Three thousand and eight
ninety seven eighty an ounces are closing level there and
over to the bottom market side of things, down four
basis points on the tenure to what four point one
percent close on that. I'm like, guess, just getting getting
(13:42):
attractive there. But you know it's poor poor Dwight said,
you know what goods are going to do? You can't
get any mortgages done right now because the government shut down.
So he was he was a little frustrated yesterday. He
didn't say it, but you could see it in his face.
He was, you know, I don't blame I mean anybody
you know it's being affected by that. It's like I
can't get tax cut transfer. And then there's some government
entities open that he deals with and some that are closed.
(14:03):
And yeah, yeah, he texted me this morning, He's like
this is just not good, not fun, all right, So
let's get down to our topic this afternoon, which again
is what does the government shut down mean for you
in your portfolio, your personal life, et cetera. So we
want to start off with a I'll call it a
big misconception because again I had this discussion with a
(14:26):
client about an hour or so ago, and they, you know,
people think that the market is always going to sell
off in a government shutdown. And I think, Jason, you
and I went through some of these numbers, I don't know,
two or three weeks ago. I mean, it was a
while back, but it's a good time to kind of
refresh everybody. So let's go back to the last major
government shutdown. So, as I said earlier, that was back
(14:50):
from the period of December twenty first of twenty eighteen
through January twenty fifth of twenty nineteen. Okay, so it
was about thirty five days overall. But well, we care
about our trading days. So it's twenty two trading days.
The average return on the SMP five hundred on a
day by day basis point four seven percent. Then amazing,
(15:14):
it was half a percent average on the SMP five vetter.
But if we tally up those twenty two trading days,
when the government was shut down ten point four to
three percent return. It's not bad, my friend.
Speaker 1 (15:26):
That's market likes it when they're closed.
Speaker 2 (15:29):
That's exactly it. That's exactly it. Let's go back to
earlier in twenty eighteen. I'd actually until I dug up
this data, I actually forgot we had to those shutdowns
in twenty eighteen. January nineteenth of twenty eighteen through January
twenty second of twenty eighteen, there's only two trading days
there Mark SMP rose point eight one percent ninety five.
(15:52):
We had five trading days during the shutdown, there a
one point three six percent gain ninety five. We had
fourteen trading day closed for fourteen trading days is the
fraction of a percent. And then in twenty thirteen that
wasn't bad, close for fourteen days and up three point
one seven percent, so you know, and then again those
are trading days. So overall market, like you said, doesn't
(16:13):
mind take it away? Why is in the market mind?
Then the government shut down?
Speaker 3 (16:17):
Well, I mean again, I think it's probably just circumspect.
A lot of times it sells off into it too, right,
and then sort of the buy the news, sell the
rumor or whatever.
Speaker 1 (16:29):
The heck you want to call it.
Speaker 3 (16:30):
I think that's part of the reasons too, righte that
you know, people start to expect the worst, and then
when it doesn't happen, as they're getting slowly more excitement
that something is going to get cured, you tend to
see strength on the way out. So I think that's
a lot of what we're seeing. And again I don't
(16:51):
think near term it matters a whole heck of a
lot as far as company earnings are concerned.
Speaker 1 (16:55):
Right maybe.
Speaker 3 (16:58):
A palanteer for example, and that there's a way out
right field shot there. But you know, who gets a
lot of their income from the government over time could
really suffer because that's lots of days they don't get paid.
But you know, does Walmart really matter if the government
shot like does it? I'm sure you could make some
bank shots as to why it will hurt them marginally,
but it doesn't really affect their business.
Speaker 2 (17:20):
It's just well, I think we saw a little bit
of that today. You saw the banks a bit weak.
Jimp Morgan's second worst perform home Depot was the worst
performer of the down down little R eight bucks. There
are some strategists out there that are going. You know,
if this thing extends for any period of time. Again,
as I said at the beginning of the show, you've
(17:41):
got government workers, contractors and whoever else may be impacted
by a long term quasi long term government shutdown. They
don't have the consumer discretionary funds now to go to
a home depot or borrow money from a JP Morgan
or something like that. So there's always that school without.
Speaker 1 (17:58):
Also, no, that's fair, that's some.
Speaker 3 (18:00):
I mean, I forget the number that we saw the
people that worked for the FED, right, some astronomical number,
but there's clearly a lot of folks. But remember everyone
doesn't get laid off to you know, or furloughed quote unquote,
like it's just a get a matter of how sensitive
and how long it ends up being. I was surprised
by that ten percent number. I know that you gave
(18:22):
there too, but yeah, it's.
Speaker 1 (18:23):
It it until it becomes a big deal.
Speaker 3 (18:27):
This just seems like the same old thing that we
always deal with with these you know, not my favorite
group of people.
Speaker 2 (18:35):
Yeah, I felt stupid this morning. Russ and I were
talking about was doing the stock up dates, and I said, yeah,
tomorrow or you're working to have this again. We don't
have the non front paerial numbers on Friday, and I went, actually, Russ,
I don't know what we're gonna have tomorrow, right because
other than ADP, I can't think of really any report
off the top of my head that we get that
doesn't have the government, you know, claws into it in
(18:56):
some form or fashion. So we may not get anything.
I mean, we got a pretty good calendar tomorrow, but again,
may not get anything. And once again, how long can
that go on? So there's a lot of reasons, but
the most important takeaway of this segment is the market. Again.
We tested it for you know, thirty five days, twenty
two trading days, and that last shutdown that was the
longest one, and the market did just fine. Again, says
(19:16):
open the show with could this time beterre? For only
time will tell now when we come back. Here's one
other thing that we got to be thinking about, as
far as your portfolios and so on and so forth,
and that is the president's comments today in some economic
as well as political strategists saying that he will use
and he made some comments out as pre secretary made
some comments in the White House just a few hours
(19:37):
ago indicating guess what, it may not just be the furloughs.
They could be using this as an excuse quote quote
air quotes to permanently rid the government of hundreds of
thousands of jobs. That's a whole different story there. So
we'll cover that as we continue talking about what is
this government shut down in near the market to your portfolio,
your personal life. Turned over to Jack Samon he's got news, traffic,
(19:57):
and weather. Hello, Jack, Welcome back to the John Sanchez
Show on News Talk seven eighty k O waits with
Jason Gount once again. We finished up forty three on
the Dow at a ninety five point gain on the
Nasdaq and a twenty two point rise on the S
and P five hundred, again, a record closed for the
Dow and the S and P five hundred. All right, now,
we just went over how the market historically reacts and
a government shut down again, government shut down at midnight
(20:20):
last night. Today was our first day. Obviously, the market
didn't care too much about it, and we just shared
with you once again that last government shut down lasting
thirty five days calendar days, twenty two trading days. We
gained a little over ten percent average or a little
over ten percent over that twenty two days of trading.
But now again, is this time going to be different?
What do you need to be doing thinking about for
(20:41):
your portfolio, et cetera. So let's I want to kind
of go back to some of the basics here. You know,
I've been talking to a lot of people today, Jason,
and they're like, what really, you know, what really is
behind this? Trying to get an idea how long this
thing is going to last. So we're not a political show,
so I'm not going to you know, point fingers one
way or the other. But you know, in summary, basically
(21:03):
what the problem is, the Democrats have remained very very united.
We needed five more of their votes to get this passed, right,
to get the budget passed, Well, we missed it. They
tried voting again this morning, I guess, and missed it again.
So I don't think they're real far off, but you know,
only time will tell. But what they're trying to do
is they're trying to get a funding building near the
Democrats to go through only if it includes some policy
(21:27):
changes that they want. Now what are these policy changes?
So their primary but again it's not the only demand
has been to have subsidies for healthcare plans through Obamacare
extended before they expire at the end of this year.
Now Republicans have said no, sorry, no way, Oh it's
not going to happen. They've refused to concede, and that,
of course is why we are now in a government
(21:49):
shut down with you know, really no end in sight.
So it's coming down to the healthcare side of things.
I know the list is a mile long for other reasons,
but you know, if you kind of just focus on that,
say okay, and you know, Jason's kind of remarkable. Again
we're talking about how strong the healthcare center was today
and here it's kind of at the crux of the problem,
and healthcare is one of the best performers today. But
(22:10):
you know, on a light note, though, I want all
of you to rest assure that there's going to be
one aspect or one area of the White House that
is not going to be slowing down. You want to
take a shot at what that maybe.
Speaker 1 (22:21):
Jason, no, no, I'm excited.
Speaker 2 (22:23):
Tell me, well, we no longer have a rose garden.
Oh yes. The President of course has now broken ground
on his new ballroom. So for those that may have
been concerned that there may be a delay in the ballroom.
According to the White House Today quote, there will not
be a stoppage of ballroom work when the shutdown occurs. Now,
(22:47):
what's this ballroom? Well, Trump signed an executive order not
too long ago, back in July calling for the construction
in the beautiful Rose Garden of a ninety thousand square
foot ordinately designed and carefully often event space that could
host as many as six hundred and fifty guests. Kind
of cool. It's like having your own convention center right
out your front door. Yeah, the renderings that have been
(23:10):
released suggest that the ballroom is going to dwarf the
White House in size. But why isn't you know this
is government property. Why isn't the construction stopping there? Well,
because the funds for the ballroom reportedly have come from
private donors and are not tied to the budget stand off,
that again is affecting the rest of the government.
Speaker 1 (23:28):
So can we can we talk about that?
Speaker 2 (23:30):
Still?
Speaker 1 (23:30):
It private? Private donors?
Speaker 2 (23:32):
Private donors?
Speaker 1 (23:33):
What's that mean?
Speaker 2 (23:34):
Private donors? Right?
Speaker 3 (23:38):
So, private donors are donating to build a ballroom for
the Trump Ballroom or whatever it's going to be called.
Speaker 2 (23:47):
Got it?
Speaker 1 (23:48):
And that's totally on the end.
Speaker 2 (23:49):
That's the same group that you know donated. You know,
I'm sure it's I don't know who the donors are,
but I'm speculating a lot of the same multi billionaires, corporations,
et cetera that don't massive amounts to the campaign. Okay, yeah,
that's my I'm sure at some point we'll find out
who the donors are. But yeah, that's that's why. You Yeah,
(24:14):
they just give them a brick, like a you and R.
You can buy a brick, you know when they do
new constructions.
Speaker 1 (24:19):
Brick for five billion dollars. That's it's interesting.
Speaker 3 (24:25):
It just reminds me of like, you know what I
see from like oligarchs of the past, right, like these opulence, right,
all the gold and whether it was like gold that
was bought a peer one or whatever. But like it's
it's all this like gold. It's just I don't, I
don't know. It's that's the part I find very interesting,
(24:47):
like them or not. I like, you know, trying to
change the view of the role or something as president, right,
it's it's it's it's gone cyclical, right, where some president
try to be more man of the people and others
to move other directions.
Speaker 2 (25:04):
It's still a podcast on that. So we got a podcast.
Invite all of you to go to our podcasting site,
Podcasters of America. We recorded a great podcast with doctor
Sanchez on Monday on AI. We really turned out to
be an hour and a half podcasts, but great, great
information there. Now, when can we expect the next vote?
It's not going to happen tomorrow. Senators are off tomorrow
(25:25):
for jan Kipper, so no meeting is going to happen.
Then they're going to come back on Friday and Saturday
for continuing negotiations and potentially more voting. So we've got
a couple days where nothing's going to happen. As I
told you before we went to break, here's the other
issue that at some point, especially when we if it
comes a fruition again, everything is fluid right now. If
it comes to fruition, this could spark a little bit
(25:48):
of nervousness in the market. Today, the President's budget chief
of Russell Woutz told House Republicans that the administration will
start firing federal employees. I didn't say furlough, I said
firing federal employees in the next one to two days.
That's according to NBC News. Meanwhile, we, like I said,
(26:09):
not long before the show, Press Secretary Carolyn Levitt, of course,
she confirmed the layoffs are quote imminent.
Speaker 1 (26:18):
Wow, these lines are amazing. A lot of good can
come from shutdowns.
Speaker 2 (26:21):
Trump's yeah, let me get to that's that's the best
place in President's quote his cabinet. I will yeah, yeah.
So this is a first quote. The President has directed
his cabinet and the Office of Management and Budge Jason's
like rubbing his neck right now. It's stressing them out
with this. The President has directed his cabinet and the
Office of Management and Budget that they are working with
(26:42):
agencies across the board to identify workcuts can be made.
Told the reporters, and we believe that layoffs are imminent now.
Prior to the shutdown, that Vout issued a memo that
threatened mass firings. Again, folks, I'm not saying furloughs. I'm
saying firings. Threatened mass firings, writing that fell agencies would
be directed to consider quote reduction in force notices for
(27:07):
all employees in defunded programs, projects, or activities not deemed
quote consistent with the president's priorities. Okay, now that's what
mister Gaunt was saying in a moment ago at a
White House of eight yesterday, the President framed the shutdown
as an opportunity. So listen closely, folks to what I'm saying,
because this may be a hint that he is in
(27:29):
no hurry for this shutdown to end, So listen closely.
So he framed the shutdown as a quote opportunity to
get rid of a lot of things we didn't want,
adding that they'd be Democrat things. Don't know they'd was
a word, but they'd would be different Democrat things. Quote
from the President. A lot of good can come down
(27:49):
from shutdowns, he said, when you shut it down, you
have to do layoffs. So we'd be laying off a
lot of people that are going to be very effected.
And they're Democrats. They're going to be there there, and
they're Democrats. They're going to be Democrats. When I read that,
I sat back and I went, Okay, if I was
(28:11):
a government employee and I'm a diehard Republican, and and
but I got my department, my agency or whatever, got
you know, creamed in a permanent shutdown, how do you
know that they're all Democrats. They're you know, he calls
them Democrat departments that I don't understand how Yeah, but
(28:31):
this scares me, Jason. I mean, we don't know the size.
I mean, I've seen some some guestimates that it could
be a couple hundred thousand people permanently after this furlough ends,
or simultaneously a couple hundred thousand people permanently have lost
their government job.
Speaker 3 (28:45):
Yeah, I mean I think that's spot on of it.
I don't think there's just like I mean, I guess
we could probably riff on what areas we think are
just full of Democrats as far as government agencies. But
you know, I mean sort of in line with a
lot of people who push back against black Rock, right, saying, oh,
you know, woke and this and that, and you know,
(29:06):
I'm like safe to say the biggest financial institution, at
least on the money management side, is not all Democrats.
Speaker 1 (29:14):
Right, So it's you could.
Speaker 3 (29:17):
Certainly have some baby right, a lot of conservative you know,
but you could see some baby with the bathwater type
stuff for sure. But I mean again, it's if you're Trump,
that's just threatening saying look, fine, you can drag your feet.
I'm just gonna fire a bunch of your people until
the point that they all get really sad and then
(29:37):
come yelling and crying to you, and then you have
to backpedal.
Speaker 2 (29:40):
So well, yesterday, it's a negotiating tactics, for sure, it is.
That's why I'm bringing this up. We don't know how
much of it's true. My gut tells me it's not
a threat. I have a feeling he's going to do it. Right.
We saw what happened with those when Musk was there. Right,
they don't hesitate to get rid of a couple thousand people.
So if he can look at it that way, doesn't
(30:03):
My heart tells me I think it's very very true.
I'm going to tell you what two labor unions just
did yesterday that represent the federal workers. They're taking it
very serious. All right, how this government shutdown is affecting you.
We'll come back and continue that discussion. Let's wrap it
up with Kristen Snow right now Traffic Center. Hello, Kristen,
welcome back to the John Sanchez Show on Newstalk seven
(30:24):
to eighty k which with Jason Gun once again. We
finished up forty three on the Dow twenty ninety five
point gain. I'm then NASDAC and up twenty three on
the SMP. Once again, our record closed for the Dow
and the S and P five hunder. All right, we've
been discussing what the government shutdown means for you and
your finances. Once again, from the stock market perspective, don't
change anything based upon your assumption of the government shutdown. Again,
(30:44):
historically the market does just find at least at this point. Obviously,
you need to tune into the show every day and
we'll keep you updated if things change. Now, what we're
talking about is something that could be a little bit
of the flying the ointment, and that is what the
President said yesterday, where you know they're proposing permanently getting
rid of hundreds of thousands is what this I've seen.
I don't know how accurate that is, but a whole
(31:06):
bunch of people permanently using the government shut down as
basically the excuse. Now, I told you that a couple
of labor unions are getting involved. Before I do that,
I want to tell you what some of the critics
of this threat by the president, if it is a
threat not something of reality. A couple of the critics
are accused of the administration of using the shutdown as
(31:28):
a pretext for the cuts that he wanted to make. Anyways,
this is according to the Progressive Center of Budget and
Policy Priorities. They said, look at a shutdown provides no
new legal authority to engage in mass layoffs, nor does
it provide any sound management or policy reason to do so. So,
now let's go back to the labor union Jason So.
On Tuesday, two labor unions that represent federal workers sue
(31:51):
the administration over its mass layoff threats. Now, the lawsuit
accused the White House of the quote cynical use of
federal employees as a pawn in congressional congressional deliberations, noting
that under the current law quote, all employees who are
not paid during a shutdown, whether furloughed or accepted, must
receive back pay for that time period once the funding
(32:12):
is reinstated. In response, Republicans have argued that the White
House can fire whoever it wants during a shutdown. According
to Mike Johnson, he said the following, of course, the speaker,
it provides an opportunity and he left it at down.
It provides an opportunity, So you see what I'm saying.
We again, this is the fun part with Trump. You
try to read in between the lines and you go, okay.
The Speaker of the House is saying it provides an opportunity.
(32:34):
Trump saying, you know every person wants to get rid of.
Is this going to be a Democrat? Which we know
that's not true. So this is something we have to
watch because I met my bottom dollar. If tomorrow we
wake up and I'm just gonna do a hypothetical one
hundred couple hundred thousand layoffs or elimination of positions are announced,
it's going to have an impact on the market after
today's week.
Speaker 1 (32:56):
Couldn't he do it anyway?
Speaker 2 (32:57):
Like why, Well, that's what that's what the that's kind
of what they're saying, that he can under executive authority,
he can like they said the White House said he
can fire whoever it wants during his shutdown, but they
said during a shutdown. So I don't know. According to
the labor Union, that's why they filed the lawsuits yesterday.
He can't just do it whether it's in a government
(33:17):
shutdown or not. So I don't know the answer to that,
but all he has to do is create a executive order,
which maybe already has and one of the many hundreds
or thousands that he can't. I don't know. It's just
starting to find its way into the newswires at this point.
So latest number, seven hundred and fifty thousand government employees
(33:38):
are going to be furloughed. Here's another interesting economic statistic
also that last shutdown I was mentioning back in twenty
eighteen and twenty nineteen, for thirty five days, it costs
the government four hundred million dollars in wages per day
according to the CBO, which okay, but I saw a
bigger statistic yesterday that it impacts one tenth of GDP.
(34:00):
For every day the government has shut down, the GDP
has to be reduced by one tenth of a percent
per week. So can you have an overall economic impact? Right?
And again back to looking at the overall economy.
Speaker 3 (34:11):
Yeah, fed cutting rates, right, so maybe job closures get
you even more rate cuts.
Speaker 2 (34:15):
That's right, and that's what many I thought about that. Also,
again back to the president just trying to read it
in between the lines. Maybe he's not in a hurry
to get this shut down over with. Because again it'll
weaken the jobs market more. He'll have more ammunition to
point fingers at the Fed to say another, don't give
me a quarter percent cut or give the economy give
it a half Right, look at the jobs market's a mess. Now,
(34:36):
we're losing hundreds of thousands of jobs, right didn that
makes sense.
Speaker 1 (34:39):
To all watch Democrats causing all this riff.
Speaker 2 (34:41):
Strife exactly got it. Of the APA staff is out
of work during the shutdown, about five percent of the
Department of Homeland compared to just five percent of the
Department of Homeland Security workers that are being furloughed. CNN
reported today All so that the Small Business Administration sent
(35:02):
quote suggested language for workers, not about you, because you
always send a out of when you're out of office,
you send that you put up that email. So the
Small Business Association sent a suggested language for workers to
use and they're out of office messages quote, I am
out of the office for the foreseeable future because the
Senate Democrats voted to block a clean federal funding bill,
leading to a government shut down. The language reads over
(35:24):
at the Housing and Urban Development Department UH, the EPA,
and the Department of veteran affairs. Their email says, quote
radical left, congressional Democrats and radical liberals respectively. That's the
reason makes sense. Yeah, that they're out of office.
Speaker 3 (35:39):
So I'm going to change my out of office. For
next time, something will be radical.
Speaker 1 (35:43):
I promise.
Speaker 2 (35:44):
There you go, John, John Radical. I'm out, all right,
my friend, great job as always. We'll do it again tomorrow.
The John Sanchez showed, don't miss it. Take care. John
Sanchez is a registered investment advisor, and the opinions expressed
by Sanchez Gone Capital Management, LLC on this show or
their own and do not reflect the opinions of News
Talks seven eighty or its pairing company, Cumulus Media. All
(36:07):
statements and opinions expressed are based upon information considered reliable,
although it should not be relied upon. As such, any
statements or opinions are subject to change without notice. Information
presented is for educational purposes only and does not intend
to make an offer or solicitation for the sale or
purchase of any specific securities, investments, or investment strategies. Investments
(36:29):
involve risk, and, unless otherwise stated or are not guaranteed.
Information expressed does not take into account your specific situation
or objectives, and is not intended as recommendations appropriate for
any individual. Listeners are encouraged to seek advice from a
qualified tax, legal, or investment advisor to determine whether any
information presented may be suitable for their specific situation. Past
(36:51):
performance is not indicative of future performance.
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