@LanceRoberts / appears on thoughtful-money, thoughtful-money, thoughtful-money, thoughtful-money, thoughtful-money, thoughtful-money, thoughtful-money, thoughtful-money
the only thing you watch right now is you pay attention to the price of oil. Yeah, because that's going to be your limiter as to what happens with markets. And again, if something happens, all of a sudden we wake up one morning and oil's up $30, $40. that's going to have an impact on markets
this is part of the thesis in our portfolio. It's part of just part of my thesis in particular. But I think if there is a bottleneck anywhere, it's not in semiconductor chips and it's not software, it's in power.
This is SMH, and, you know, it's kind of building a pretty defined head and shoulders pattern. And again, hasn't broken down yet, but I think this is the one thing to watch
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}AISO Market Calls classifies public statements from public sources. A classification such as long thesis, short thesis, or explicit call describes the content of the public statement and does not prove that the speaker actually entered, exited, or held a position. Market performance shown is calculated from public market data around the source publication or timestamp. It is not investment advice.
Chip stocks have run so far they are already priced for profits years out, into 2028 and even 2029, and that is the most crowded, fragile trade right now.
Q3, Q2, Q3, Q4. are just going near parabolic right now. So, you know, it's just the expectations for earnings growth are just getting more and more optimistic. So if there's a risk to the market, it's going to be disappointment in earnings
Defense stocks will do well, right? If we're launching missiles, Raytheon is going to do well.
I think the odds are nothing right now. And this has kind of been our case for a while is that I don't think the Fed cuts. I don't think they hike. And because you really don't have the data on either side to support it
When margin debt starts to decline, you get margin calls, which create forced liquidation, which create more margin calls, which create more forced liquidation.
we're going into that earnings season with a lot of the Mag Seven, their expectations have really declined about their kind of their ability to beat rates and earnings.
What concerns me right now more than anything, and again, I'm watching that semiconductor space very closely, particularly over the last couple of days. There's a lot of margin debt risk in that sector in particular, because investors were not only taking on a lot of margin debt to buy you know, semiconductor stocks, they were taking on margin debt to buy leveraged ETFs that were directly related to semiconductor stocks.
we started last Wednesday and we rebalanced our portfolios, you know, from, from the value back the, the mega-cap growth trade in particular. And so we finished that on Monday in our 60/40 allocation model.
we made a rotation from, from value into growth. And specifically, that rotation from value to growth was value to mega-cap.
There's a 72% correlation between wages and inflation... what real wages are actually growing slower than inflation. So you've got a negative real wage growth on top of a declining personal savings rate. That's not the combination you need for stronger economic output.
Again, like Saylor just put out today... STRC is a symbol on that one. That's his stretch preferred perpetual preferred. And it was paying 11%. I think it's paying 14 or 15% now because decline in price.
No, everybody's piling into a commodity trade that's historically very volatile. On the expectation that this earnings growth is now infinite, and it's not.
We are punching record levels of margin debt. And again, like I said, these are people that are buying on margin leveraged ETFs or options on leveraged ETFs on margin. So, you know, the blowup is going to be spectacular at some point.
They're inflation of expectations, wages, and economic growth. And if you take a look at those three, we should be trading around 4.2% right now.
you'll see money rotate back into stable growers, which will be your Mag 7.
if you're playing the infrastructure development trade, that's got another year, 18 months to it, maybe 2 years, but that's going to end. And that whole infrastructure side of the trade is going to go away, and you're going to have to move to the revenue generation side of the trade.
No, we did a rotation yesterday... our value-growth rotation model... that growth, that tilt switched back to growth... it's basically using value stocks versus MGK, which is the mega-cap weighted index.
There's, there's different problems with, with gold miners and the big risk to them is the dollar and the dollar is getting a lot stronger... the whole gold trade previously was on the debasement of the dollar, dollar dying, that type of thing. That narrative has pretty much been crushed and we've had a very strong rally in the dollar.
We've got record net capital inflows into equity. So we've got so this is foreign investors taking on dollar exposure. Into US equities. And not only are they doing that into US equities, they're also doing it into, into bond funds as well.
the futures market never priced it out, right? The futures market was saying that in 6 months, 8 months, prices are going to be back down into the, you know, $70 range, $60 range... we're down 3.5% right now at $69.38.
technically it looks terrible. Um, it is very, very oversold... there are going to be buyers that come into the market at some point... It just needs a catalyst of some sort... something that gives the bulls a reason to buy Bitcoin.
We're at record where we are punching record levels of margin debt... these are people that are buying on margin leveraged ETFs or options on leveraged ETFs on margin. So, you know, the blowup is going to be spectacular at some point.
I think your big risk is in semiconductors. Those stocks have gotten way, way ahead of themselves right now. There's a lot of concentration in that sector.
there'll be no cuts this year. Oil prices will come down. Look, we're going to get the PCE print this week coming up. That's going to be hot because again, that's picking up the lag of higher oil prices.
inflation was hot in this last report, 4.2% is almost all oil related. Now with oil back down into the 70s, that's going to go away in the next month or two as that oil deflation comes back through the system.
I think your big risk is in semiconductors. Those stocks have gotten way, way ahead of themselves. We're now pricing in 2028 earnings. For those companies and actually starting to price in 2029 earnings. That's a lot.
I would take profits. I would hedge. Hedging is cheap right now. Adding value stocks is cheap. Holding a little bit of extra cash is opportunistic.
this goes back to Michael Green's giant mindless robot, which all that feeds the underlying stories. And of course, what are these stories that everybody's buying? Tech, semiconductors, and other stuff. This is space, you know, SpaceX, et cetera... So all the retail buying is in the most speculative sectors of the market.
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