Joey Loss 00:13
Adam Van Wie, we're back for another Market Chatter.

Adam Van Wie 00:16
Seems like just a few days ago we were here. So much has happened between last time we recorded and today?

Joey Loss 00:23
Yeah, well, you know, between the last one and this one, we made the decision to go ahead and start doing these twice a month. I just think there's enough going on. And honestly, I think it's good for listeners to get a chance to just see what is going on underneath the hood of the economy. I mean, we see broad headlines, but you don't really get a lot of kind of nuanced takes with people that are working with real families about their money and how this stuff might impact them.

Adam Van Wie 00:48
Yeah, I do think we get a really good perspective on the kind of across the spectrum of you know, all of our clients have some money or have the ability to have some money someday. So maybe not on the lowest end of the economic spectrum, but from from the middle to the high end, I think we get a pretty good, pretty good, diverse view of what's going on with with different people and different ages too, because this economy is it's kind of split, and we've just been talking about that a lot, and I think That's one of the reasons you're getting so many different takes on what's going on right now.

Joey Loss 01:25
Yeah, I think that's an interesting place to start. The The Wall Street Journal just put out an article and their financial section talking about how if you removed all the headlines, right? I mean, there's just 10 different crazy articles every day right now for consumers to digest. If you remove all that and you look at totally just a macro picture of where things are now versus where they were maybe six months ago, his argument was that there isn't that much of a difference, although with the headlines, it feels tremendously different. And the thing that you pointed out was that there's really two stories that are going on right now, and if you go back several years, you see that there's actually a divergence going on for different people within that economy, which might look a certain way at the top, but differently when you get under the hood. Can you tell us more about that? Yeah,

Adam Van Wie 02:12
it's, it's something that I've been saying on on my radio show for for years now, is that it's so easy to make a case right now, if you want to argue that the economy is in great shape, easy to do. If you want to argue that the economy is in terrible shape, very easy to make. And these are very compelling arguments too. It's not like you're just making a pulling some anecdotal evidence out of thin air. There's solid data on both sides right now, but it's very easy to take the side of the Wall Street Journal and say, you know, things really aren't that bad. It looks pretty good overall. But I think you're discounting a large swath of America if you do that. Because the problem with the post COVID world is that if you were already in a good position, if you had assets going into COVID, and you owned a home, and you had a brokerage account and a 401, K, you probably came out of COVID in a much better position, because all those assets went up by a huge amount. Your home went up by at least 40% you suddenly had more money and more net worth than you've ever had in your life. But if you went into COVID as a, let's say, a blue collar with blue collar job, and your factory shut down and maybe return, maybe it didn't, and you rented and all of a sudden your rent was skyrocketing at 15% a year, you probably ended up in a much worse position than you did going into COVID. And I think the thing about today is that those people are still struggling. And if you just look at economic data, it's not going to take into account that their groceries are 30 40% more expensive than they were five years ago. It's not going to take into account that they're still paying a higher rent now that rent isn't going up like it was during COVID, but your one bedroom apartment that used to be 800 bucks is now 1800 bucks, so that it just hurts. It's it's not as you don't have that free cash flow that used to have, and your prospects of owning a home are probably the worst they've been in your your adult life. It's just there's a lot of other things that you have to take into account when you're talking about the economy as a whole. And so I really think it's easy to make that argument on both sides.

Joey Loss 04:32
Yeah, that that is a great layout for for those cases. I mean, if you own a home, you didn't have to go through the pain of purchasing a home in an environment where homes prices were surging, the rates on those homes were surging. Meanwhile, the stock market, you know, what's a few except we've we've are now in the third bear market of five years. But if you step back and just look at, you know, it's pretty much up and to the right, if you can withstand the volatility that we. Saw over the last few years. So those that had, you know, really benefited. And, yeah, I don't think that's changed into this year. And the question is, you know, in everybody's minds, is, what is the impact of the tariffs going to be? Because historically, tariffs have been a bit of a regressive tax, in the sense that those that are spending money feel them the most, right? And if you definitely, if you're in a position where you only spend 20 or 30% of your income on what you need to live because you're able you have a high income or low expenses, or, you know, you're able to avoid most of the pain. But if you are already in a position of spending 70 or 80% of your income, or 100% of it to get by, then even a 10% increase in 20% of the goods that you have to buy can be very painful, absolutely.

Adam Van Wie 05:42
I this is, this is an area that's really hard to unpack. We've never seen anything like this before, and so when you think about what a tariff is, it's basically a an extra layer of cost that's added into the production process of the goods that we buy, and therefore it's hard to imagine a company eating that additional cost and not just passing it on to the consumer. So the fact is, most times you put added costs into a production process, it affects the end user, the purchaser of the good. And that is the problem with the strategy that as it's been laid out to us right now by the current administration, is that it would really would be a regressive tax on Americans who are already suffering from the regressive tax that is inflation. And so if that's actually the end goal, I don't see how that works. It just doesn't make sense to me. I don't think it makes America stronger, and I don't think it puts us in a great position. However, there's like, a big asterisk by that, if it's being used to negotiate different, better trade deals that allow us to sell more goods and services overseas, then the temporary pain will go away, and we might be in a better position coming out of this than we were. We don't know. And that's that's one of the biggest problems, is all this is what's creating this uncertain market, and all the kind of like that empty pit feeling in your stomach about what's happening with the stock market right now. That's where it's all coming from. Yeah,

Joey Loss 07:26
yeah. I think that's well put. There's just a lot of wait and see. And honestly, I know you and I have been consuming information voraciously and talking about it offline. We come here now more often to talk about it here, and I think it's kind of one of those Dunning Kruger effects things. It's like, the more we understand about this, the more I don't want to express what I see in the crystal ball, because it's just foggier and foggier.

Adam Van Wie 07:50
Yeah, it's, it's so hard to predict anything right now, and I get why the market's going down. If I'm an investor right now, if I'm a short term trader. I don't want to be anywhere near the market right now, because you just don't even know what tomorrow is going to look like. You don't know what's going to happen later today, much less a week from now. You don't know what corporate profits are going to be in a in a few months. As a long term trader, I generally take the attitude of, well, we're we have a lot of clients who are who are buying right now or putting money in the market every month, including ourselves. We both have 401, ks. So I don't mind it as much. And I know that sounds Cavalier, but I don't need, I'm not going to touch this money for years, and with us and our clients, anything that is needed in the next five years or so is already in short term, very safe assets, and it's it's so if we have to ride this out for a couple years and draw down the bond side of the portfolio for clients, yeah, it's never fun, but we've been through this before. We've seen it before. We know what happens, and we have time to ride it out. And so therefore, I don't worry about short term market craziness like this as much as maybe someone who's who's less of a long term investor? Yeah,

Joey Loss 09:05
I think that's a good story for the for the market side, from the from the spending side, you know, I can empathize with some of the pain that people are feeling, the cost of having a child. I mean, we have a 14 month old daughter. We've got a son on the way in September. You know, I just bought the second car seat because she's outgrown the first one. It was 800 bucks. And granted, we didn't get the cheapest one we could find, but we got one that's going to last for several years. And, you know, it converts to a booster. The construction manual is, like 100 pages, and every page referred to, like four other pages. Took me an hour to install it. It's pretty incredible what it does. But I saw an article talking about how, you know, the prices of things like car seats like this could go up 300% because a lot of them, you know, spoiler made in China. And, you know, this is just, I call this phase the bottleneck with young families. It doesn't matter if their income is middle to high up or, you know, middle class to. Upper class. I mean, it's just expensive, right? Daycare is $18,000 a year, and that's in Jacksonville. If you live in a more major metropolitan area, it could be a lot more than that. A friend in Philadelphia whose nanny costs $33,000 a year from one child, wow, you grow in the strollers to this the that if those products, most kids products, are probably made in China or Vietnam or Cambodia, one of these places. And so I think you know outside the portfolio, even if you've got one and you're contributing to your 401, K, you're certainly in a position to potentially feel it there. But maybe this serves as a good segue to where are we in the market? It's almost hard to know based on the change from week to

Adam Van Wie 10:44
week. So that depends what part of the market you want to look at. I mean, we've got the S, P down right around 10% this year prior to today, and you've got the NASDAQ off a little bit more than if you own Q, Q, Q, it's a top 100 stocks in the NASDAQ. It's down about 13. I believe the NASDAQ, the overall is down a bit more than that. If you're a value investor right now, you're holding up a little bit better. If you look at the value side of the s, p, it's down about almost 7% but on the on the growth side, down almost 13. So big, big split there. But there are ways that you if you're invested in other ways, there's areas that are holding up a lot better than that. For instance, if you have a bunch of utilities in your like a defensive sector, like utilities, consumer staples, those are actually up this year, both around three to 4% three to 5% maybe, if you own commodities, gold and silver have gone crazy in the last year, or in the year to date, gold's up like 27% and silver is up 12 and even fixed income has done pretty well. The overall market's up about 2% this year, and it's still paying these higher, higher yields, not quite as high as they were under the peak around that I think that was around five and a half, but now we're still seeing yields around four, four and a half percent, and that's really not bad. Plus, you get the appreciation of the if interest rates continue to come down so also international and much better than the US right now, just a totally, totally different story overseas. You've got the all world except us index up about 4% you've got emerging markets just barely positive. Part of that weakness there is just China. China is one of the few international markets that's down this year only about three and a half percent, but compare that to like a Spain, which is up 26% so Europe has done very, very well this year. It's outperformed the US by the widest margin that I've seen in my professional career, which it's been lagging the US for years and years. So there are ways to make money right now, and if you have a diverse portfolio, you're probably not seeing that full 10% down on the s, p, you're probably seeing a small fraction of that.

Joey Loss 13:09
Yeah. And I wonder, you know, on the international front, they have uncertainty, obviously, because of all the tariffs, but they're not really the main actor in this trade war. If that seems to be budding, I think that's part of it. And also you have some of the initial reaction from Europe and in Germany in particular, to the tariff announcements. Was in our relationship with NATO, that's changing is just kind of the US deciding not to be dispender for everything related to defense for the West, and one of the responses from Germany in particular was to increase government spending on defense. And there just is a relationship over time. If you see a greater amount of government spending within an economy, I mean, it boosts that economy, because there's now more dollars being spent on production.

Adam Van Wie 14:02
No doubt about it. We saw it during COVID. I mean, you saw a huge amount of government spending and a huge amount of economic activity, and those two things were directly correlated.

Joey Loss 14:11
Yeah. So I looked up this morning just to make sure my understanding of where the tariffs are right now is accurate, because they've changed quite a bit. People, I'm sure have noticed. So just to touch base on that, right now, what we've got is a universal 10% tariff on basically everybody. And that's kind of the placeholder right now, ever since the tariff pause the Wednesday before last, so that was probably around the ninth or the 10th. We've got a 25% tariff on most goods from Canada and Mexico, and a lower 10% tariff on energy related goods from Canada. Also, certain auto parts that meet the terms of usmca are exempt, and I think that's still kind of a work in progress. There's a lot of headlines talking about what the impact of those tariffs are going to be on the cost of a car within. The United States. Initially, those numbers are pretty scary, as high as $12,000 on average for a new car. I know that's not something that people want to see happen, so I think that's something they're trying to resolve. Is given the production nature of cars in North America, where they pass over the, you know, certain parts pass over the border of Canada and Mexico, maybe several times before in production. I think that's something they're trying to work out to make it make sense.

Adam Van Wie 15:25
Yeah, I think that any of these shock headlines that you see right now you can pretty much just, you have to just put it through the does this make sense test? Do you really believe that in two months that a car is going to cost $12,000 more than it did today, and I don't buy it. I don't think that the I don't think that that is the goal of the administration. And I think that if that happened, they would quickly roll back anything that was causing that I just I don't buy it. Their goal is not to make life unaffordable for the average American, especially the Americans on the lower end of the economic scale. I just I don't believe that that is the end game that they have in mind. And so when I see things like that, sure, I believe that you did your economic analysis, and that's what that would happen if everything was static and stayed on course, just like it was. But everything is not static. It's very dynamic, and I think that a lot is going to change if that does happen, and I'm wrong, I feel like we're gonna have some serious economic problems, but I just don't believe that's the end game. Yeah,

Joey Loss 16:38
and a good comparison might be just to look at how things have been handled with regards to, like, eggs, right? Egg prices were crazy. It started to correct quite a bit initially, I think, in the last episode, just two weeks ago, it feels like a lot longer than that. I was talking about the impact of the Apple iPhone pricing, if nothing was changed. And since then, there has been exemptions made with China for electronic goods and devices, right? Because if you want to make people really mad in the US affect the price of the iPhone, the price of gas, the price of eggs and the price of their cars, and all four of those were on the table, and we're starting to see those start to get

Adam Van Wie 17:13
corrected, yeah, for sure. And that's why markets are dynamic, because when things price too high, people, it's like the oil analogy, and this is one that we talk about on my show all the time. When oil prices get high, it's a self correcting Mechanism. People buy less oil, and oil prices fall. When oil prices get too low, people buy a ton of oil and gas, and the prices start to rise again. So it's just one of those things that the laws of supply and demand are pretty universal and they really work. And it sometimes takes a while for these things to get sorted out, but they do.

Joey Loss 17:50
Yeah, I agree with that, the reciprocal tariffs, the much larger numbers from the postcard that Trump was holding in the Rose Garden on April 2, those are on pause until about July 9. And you know, at the moment, there are reports of a large number of countries coming to the table to try and negotiate. I'm not sure a ton of progress has been made yet, but on average, trade deals historically have taken between one and five years to become firm. And so you've got a lot of trade deals on the table, and I think you will see blocks of trades deals being done at once, instead of individual deals with every single country. But they're working through that. We're seeing some changes, like the electronic exemption and things like that happen. So I think it's still wait and see on that front. And if things feel horrible, you know, I feel like there's reason to believe that everybody has a vested interest in making it better. I don't think it's just going to hang out in in the terrible spot that it's in right now. If people feel like that's the case, yeah,

Adam Van Wie 18:52
I think we saw a bit of that last week too, with the market actually reacting to some to some actual news. We saw United Healthcare just take a real beating, but it was because of their earnings, and it wasn't because of any tariff related news. And for me, even though it was not good news, it still felt better to see the market trading on actual economic and, you know, data, instead of just this wild swings based on potential impacts of tariffs. And so we're getting really into the height of earning season over the next couple weeks. And so we'll see what actually happened in the first quarter. And maybe, I don't know how it's going to go, but I'm, I'm just hoping that the market returns to trading on fundamentals instead of on this, this sort of tariff theory, that we really don't have any idea how, what is going to happen.

Joey Loss 19:49
Yeah, I expect that'll be the case. I mean, in period, that's kind of the start of recoveries, right as you go back to fundamentals, because people, let's step back the last two years. Yes, you had great corporate earnings for a lot of companies. I think, in fact, late last year, we had one of the highest corporate earnings periods on history over the last 100 years. I remember your dad saying that on the radio, and you know, that created this environment where everybody adds an emotional layer of premium to equity prices because they just everything's moving in the right direction. So people step away from fundamentals, they start just riding the wave of bullishness. And there's a premium that that starts to show up in higher earning multiples that people are willing to pay for the price of a stock. And that looks good in a 401, K, and then you have kind of a shock to the system. But we enter about a month ago, not even a month ago. Gosh, three weeks ago. And and the emotion flips right. And so now you have a What's the opposite of a premium decline

Adam Van Wie 20:53
discount, I guess. There you go, discount.

Joey Loss 20:54
And now there's kind of an emotional discount potentially right on what, what things are trading at versus the fundamentals. So I think at some point things have to revert to the mean. People look at the fundamentals and will say, Okay, this either makes sense or it doesn't right. If fundamentals look bad, as you saw with United Healthcare, you'll see prices decline if, if Nvidia, despite the chip stuff that's on the table right now and other things, just keeps pounding it and doing a great job. I mean, for buyers, you're buying the profits of a company. At some point, that has to make sense again, and people have to respond to that.

Adam Van Wie 21:29
Yeah, yeah, you're right about all of that. And one thing I always say is that in the market, that you always overreact. The market takes everything too far, and it washes out on the on the top end, it washes out on the bottom end, because it just, it gets to a point where you just know that it's absurd. There's it doesn't make any sense. You can't make a case for the like, last year, around July, I just started to get like, wow, this is insane. The market is just going crazy on the upside, and we're at, you know, 27 forward peas and like, why there's no reason for this doesn't make any sense. Every I thought going into last year we'd be lucky to see like, a 7% year, and here we are over 20 halfway through the year. It just made no sense. And so it does that on the upside, and then the same thing happens when the market gets in a bad mood. It's going to stay in a bad mood long past what seems reasonable to a normal person. And so I think I don't know if we've reached that point yet. They call it capitulation, where it's just kind of like all the retail investors just give up and think that the market's going to stay down forever. But when that happens, look out that's usually the time to buy. Yeah,

Joey Loss 22:46
you've been referencing some data in client meetings that I thought was really interesting regarding political leanings and sentiment. Yeah,

Adam Van Wie 22:56
yeah. So the Michigan Consumer Confidence Survey, it's just been, it's been really, really interesting to follow lately. First of all, consumer confidence is at one of the lowest points we've ever seen. It might be the lowest point on record on the survey. I'm not 100% sure about that, though, but it's just people are are so negative about everything right now. And I get it. It's a it's a scary time. There's a lot going on, and the world is just like, really divided, and people are wondering if the US is losing its brand equity, its premium. All of these things are, are being talked about in the news. And so I get it, but it's really interesting. If you dig into the data, Democrats are, they are like the lowest number ever. Are like dragging down the survey to a point where it's just like they're just off the charts, bearish on everything. If you look at Republicans, they're still pretty optimistic right now, and independents are pretty split. So kind of makes sense based on what you know the election results recently. But as we get further through this tariff thing, you're seeing some of the independents move to the Democrat side, and you're seeing some of the Republicans move to the independent side. So the whole survey is just shifting to the bearish side and consumers. So we always say about the markets, if bear sentiment is high, that's usually a good time to buy, because can can retail investors almost always get it wrong. But if you look at consumer confidence, not as much of a inverse correlation there. Like the consumers actually sometimes get it right, because they drive so much of the economy, if they're feeling bad about the economy and don't spend money, that can, actually, I don't know if it will cause a recession, but it can contribute to a recession.

Joey Loss 24:50
That's, yeah, that's really interesting, and I think that is worth thinking about as you read. You know, it's so hard nowadays, I have to read multiple. The newspapers to know where different pockets of people sit, and with regards to my own feelings, you know, it's really case by case, like whether I feel good or bad about a particular political policy, and I think most Americans that that group of Americans, is the group that decides the elections right. You have people that are loyal to the right, people that are loyal to the left generally. And then you have the middle electorate, which is, you know, without really much debate, is the group that decides who, which party is in power at any given time. And economic sentiment going into this election was the number one driver. You know, there was a lot of other important things on the table. You had immigration, you had tax policy, other things, but for the most part, general economic sentiment was sour enough for that middle group that they wanted to change. And so I think when you look at the data that you just described, you see kind of a willingness to watch and see what can happen in this change that we're seeing. Yeah,

Adam Van Wie 25:57
I definitely know that to be true from the middle and the right, the left is pretty much just given up on on this policy. What if they ever had any any support for it at all? It's gone so well. Honestly, I'm in the camp that we have to wait it out and see what happens, because we were on a path to just debt levels that were unsustainable. I mean, we're piling debt on top of debt, and it's to me, that's just bad policy. You cannot, you can't run a country like that. You have to have some business principles applied and be fiscally responsible to a degree. I just don't believe that printing money forever is a good solution to your problem. So that's why I'm kind of in the camp of wait and see what happens. Because I do think, I do know that the administration is concerned about the path we were on, and if we can change it and start to level off that, that growing pile of debt, and maybe even put a dent in it, I'm all for that. So I guess that's why I'm a little bit more on the side of wait and see. Yeah,

Joey Loss 27:03
I think I'm in a similar camp. Because, you know, this weekend I saw an interesting some commentary from years ago from Warren Buffett talking about trade deficits. Because one of the things I've struggled with since this tariff regime came out is, does basing this on trade deficits make any sense? And initially I had a pretty visceral reaction, no, this is really dumb, and I still don't know that I fully agree with the method and the severity of how it was laid out, but Warren Buffett's comments were about the impact from a macro perspective on a country of operating at trade deficits for a long period of time. And generally, he's saying, like, Look, if you if you're spending more than you're producing and having people buy from you, you're creating receipts. You're giving them paper, but you're giving them receipts that allow them to call on debt at some point time, because there's more money leaving the country than is coming back in through and that's a super simple explanation. I mean, that's literally what a trade deficit is. But there's something about the framing of that way, the creation of receipts that are then callable debt, and that is directly related to the trade deficits that pinpoint the way he put it, kind of opened the door for me to have a different perspective, personally on the use of trade deficits as at least part of the discussion for what needs to change,

Adam Van Wie 28:22
yeah, and especially when you see things like, uh, tariffs on us made automobiles. That's that's something that going into other countries. Like, there is no reason that Japan should sell, I don't even know how many 1000s of cars into the US every year, but we can't sell our f1 50s there why? That's not, that's not good trade policy. That's that's definitely us being I don't know if we're being taken advantage of, but we're not being treated fairly. And so things like that, I 100% agree need to be looked at. And so in that case, a deficit I would agree with, I don't know that I agree with all of the like. I don't think we need to erase every trade deficit around the world. It just doesn't make sense there. There are, there's no way that we could produce all of what we consume in the United States within the next five years. It's, it's impossible. It's, it's a total pipe dream. So I think it needs to be looked at with more of a detailed look than just like, Oh, if we have a trade deficit, that's that's got to go away right away. That doesn't make sense to me, but more a more structured and detailed approach. I think is, is a good thing. Definitely

Joey Loss 29:36
you could. I think you can separate it into two different camps. I mean, you have seriously developed countries in the west and in the East. I mean, you've got Japan, South Korea, I think the top five economies. So they're certainly developed. And you've got China, who has historically been an emerging market, but now, from a big picture perspective, is a major player. I mean, they are more. More of a superpower than China or South Korea. For sure, you have that in one camp, and then you have smaller economies like Vietnam and Lesotho, which has been brought up a million times since the tariffs came out, because we put 50% on them. They're just not going to be they don't have the buying power. No companies or macro or individuals have the power to buy our goods because we produce high cost services. I mean, that's really what US exports. So it's just, it's not going to be even, and that's okay. But when you look at a relationship with a more of a superpower or major developed economy, I do think it's a different discussion to your point about intentional, structured deals. I think that's where that shows up, and there's room to improve for the United States position,

Adam Van Wie 30:45
yep. So again, all of this is why I'm open to the wait and see on what happens with the policy going forward. I think that if we can hammer out some of these deals and get them announced, you're going to see the remarket. The market respond somewhat favorably to those announcements. It just is taking longer than all of us want to but these are, these are complicated talks. It's not something that we're going to just figure out overnight. In my opinion, I think it's going to take a little bit. And so in the meantime, you know, if you're, if you're an equity investor and you can't handle a little bit of volatility, then you may want to rethink your your investment strategy. It this is, this is no different than what we went through in 2022, and 2020, and several other times before that. I know it feels, it always feels different this time, but when you look back on these events, it's, it's almost never different this time, right?

Joey Loss 31:40
And even if you go back to the Great Depression, which is probably the greatest example of a global breakdown in international trade, in the trading history of equity markets, it took 10 years to get back to a place where equities were growing again. But if you owned equities going into that growth, you were in a good position. And so that's where the equity premium is earned. Is your patience and willingness to weather uncertainty could take 10 years. It could take two months. I mean, there's been very short bear markets like COVID showed us. I mean, what do we go from the top to the low to new tops within like, 30 or 60 days or something?

Adam Van Wie 32:15
Yeah, since the since the advent of the Fed recessions have been getting they take less time. And I think part of that is the Fed part of that is information flow. Things happen much faster than they did during the Great Depression. I mean, you think about communicating someone with someone back then you had to send a freaking letter followed by mail. Yeah, now it's instantaneous. So the information flow is just totally different, and I just have a hard time believing that or that this would also take 10 years to get out of it just doesn't seem like that that would be the case. But who knows. No one knows what's going to happen. I have been seeing an increase in the amount of people on TV who say they know what's going to happen. This is, this is the sign that none of them know what's going to happen. Whatever they say is actually not what's going to happen. So just, just discount anyone who's predicting the future right now.

Joey Loss 33:09
Yeah, the more more certainty I see from talking heads on TV, the more of an equity premium I predict for the future.

Adam Van Wie 33:15
100% you

Joey Loss 33:18
mentioned the Fed, and that might be a good place to close for today. I think was it last week they they did not do a Fed rate cut, which that upset Trump quite a bit. I know he's going after Jerome Powell now, but it looks like in general, the market is pricing in a few rate cuts. What do you think is going to happen on that front? Or what are we seeing from the data?

Adam Van Wie 33:39
Yeah, I think, I think the economy is soft enough now and the inflation is under control. I mean, you're, you're seeing, you're seeing pretty positive, good inflation numbers. So the last month, we saw the PPI decline and the CPI come in at one of the lower levels we've seen in a long time. And so I think that the Fed has room to cut, and probably will. It may not be on the timeline that Trump wants, but Paul doesn't report to Trump, and I don't think he should. The Fed, fed independence is pretty important. I think Paul has done a pretty good job compared to his predecessors. And I also, I just, I think he's he wants to keep some dry powder in case things really do go bad, then you don't want to be in a situation like we were in for so long, where you're at 0% interest rates, and if anything bad happens, what are you going to do? You have no you have no recourse in them to help things recover. If you already are at a zero interest rate policy, you can go negative, like they did in several other countries, but that's just a that's a recipe for disaster.

Joey Loss 34:47
Yeah, that's a nightmare. You're better off holding a loaf of bread than money. That's not a good position to be exactly Okay. Well, anything else that we need to tackle for now, I'm sure in two weeks, we'll have a whole plethora of new information. To work with. Yeah,

Adam Van Wie 35:01
I think, I think the, the big theme right now is just hang on, if you can, if you can weather this, if you don't need the money anytime soon, I would just close your app that has your 401, K balance on it, and maybe not look at it for a few weeks and let things play out. Because historically, that's been the best thing you can do in times like these. I guarantee if you try and make moves, they're going to be wrong. If you sell out, that'll be the day the market turns around. So just don't, don't try and don't try and time the market. Don't try and be a hero and try and figure out a way to navigate through this by making a bunch of moves. Because you won't, you will put yourself in a worse position than if you had just held on through it. Yeah,

Joey Loss 35:39
I agree with that. And to add to that, you know, we've had some folks come in that that have found themselves for the first time feeling pain because they're in just a handful of positions that for the last several years have been really strong. Everybody sort of the mag seven at this point. You know, markets like this are an opportunity to kind of one feel the risk that's associated with having a very concentrated portfolio, but they also present an opportunity to be kind of tax aware as you reconsider your path going forward. And you know, while we're saying wait and see and we don't know what's going to happen, that doesn't mean doing nothing is always the best thing. There are ways to reallocate and still be invested and be smart as you do that, and that is what we do. And you know, there's a lot of good resources out there too, for the DIY ers, but it's just something to think about. A period like this is not devoid of opportunity. No,

Adam Van Wie 36:33
in fact, it creates a lot of opportunities. If you're, if you're a trader, I think you're, you're probably in heaven right now, compared to where you've been in the last few years, you're seeing all sorts of things on sale. And whereas if you go back five months, there was nothing on sale.

Joey Loss 36:50
Yeah, that's right, all right. Well, we will call it there Adam. I look forward to talking to you again in two weeks and seeing where things are.

Adam Van Wie 36:57
Yeah, I can guarantee it's going to be it's going to be interesting, and we'll have lots to talk about

Joey Loss 37:03
that's all right. All right, take care. Adam, bye.

Joey Loss 37:11
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Disclaimer 37:36
The Wealth Unplugged podcast is sponsored by Strivus Wealth Partners, Joey and Adams SEC registered investment advisory offering Financial Planning and Investment Management services to clients across the United States. The opinions voiced in this episode are for general informational purposes only. Nothing any host or guest says on the podcast is meant to serve as advice or recommendations for any individual security to determine which investments may be appropriate for you. Consult your financial advisor prior to investing. This information is not intended to substitute for individualized tax insurance or estate planning advice. Please, consult your tax advisor, insurance agent or a state advisor regarding your specific situation.