Joey Loss 00:00
Some Microsoft 4 trillion. We got two people in the club, huh? Yeah, it looks that way.

Adam Van Wie 00:06
I did it hold it though, on Friday when the when the market dropped,

Joey Loss 00:09
that's a good question. Let's see it is now, just below,

Adam Van Wie 00:16
okay, I thought maybe that would have happened big bounce back today, though you might, might see it reclaimed.

Joey Loss 00:22
Yeah, today, today, everybody is August 4, 2025 Monday. Quite the weekend. You know, we had some some data scrubs from the BLS. We got the Fed acting before that data was scrubbed. No shortage of headlines.

Adam Van Wie 00:37
The timing was just couldn't have been any. I don't know if you want to call that perfect or imperfect, but it was, it was very odd the way that all went down.

Joey Loss 00:46
So since the headlines do nothing to help listeners understand what the heck happened to happen? Can you give us a breakdown?

Adam Van Wie 00:52
Yeah, definitely. So Wednesday, during the Fed meeting, Powell came out and said that, no, no, rate cut, and the market was there. There was a decent odds of a rate cut. It wasn't overwhelming, but he said no. So the there were two dissenters on on his board, and that hasn't happened since the 90s. There's sometimes there's one, but rarely is there two. And some of that's political. One guy's vying for the job, whatever. But there were, it was interesting that this hasn't happened in so long, and then that happened during this time, because on Friday, the BLS, the Bureau of Labor and Statistics, that's a federal agency, came out with the jobs report number, and I think the headline forecast was for 100,000 jobs created. It came somewhere in the 70,000 range. So not great, not not the worst I've ever seen, but definitely not a not a great number. But that wasn't the interesting part of the story. The interesting part of the story was that there were revisions to the last two months now, when you think of revision, you think of like a percentage of the total that you were off by maybe within 10% Oh, no, these revisions totaled 258,000 jobs over the last two months. It was 88% of the total of the entire jobs that were reported created in the last two months were revised Off they went away. So you've got a bigger drop than almost the freaking job number. I mean, it was like, What is going on? How can you have the Fed looking at these numbers and making policy decisions off of them, only to come out two days later and say, Oh, my bad we screwed up. All those jobs were fake. I mean, the timing couldn't have been any crazier. It's just just made the BLS look like total clowns, in my opinion. Yeah, and it's

Joey Loss 03:00
just unfortunate, because we're at a time where people are already questioning institutional integrity, and I don't think there was a dishonest I don't know how you could prove any sort of dishonest intentions, but I think there's no question that the methodology that they use for determining jobs on a monthly basis is just way out of fashion. It needs to be redone.

Adam Van Wie 03:21
This comes on the heels of an 800,000 revision for the prior year that happened last year for, I believe, 2023 so that was like, Wow. I mean, that's a huge mistake, 800,000 jobs. But this coming on the heels of that, it just makes the whole, the whole Bureau, look incompetent. And like you said, it really people are questioning all the big, all the big government agencies these days, and this is not helping anything. Compound that with the Fed make they I think he's Powell specifically referenced the jobs numbers in his speech on Wednesday, and it just makes everything look so either, it depends what your point of view is, but it either looks corrupt or incompetent, yeah,

Joey Loss 04:12
yeah. And headlines are doing what they do, you know, depending on what side it's on, it's, you know, Trump doesn't like the results, so he fired somebody. I don't think that's fair at all. I mean, if in our job, we got a retirement plan 88% wrong, I think we would rightfully lose our jobs, or at least I would

Adam Van Wie 04:30
hope we should. Yeah. I mean, I think anyone like outside of maybe a weatherman Who gets it 88% wrong should be fired.

Joey Loss 04:39
Yep. I mean, just to review, like the Fed looks at that and that jobs is a big component of what they look at when they're deciding, do they need to cut? What do they need to do with rates? Right? I mean, it could be any environment, any situation, that's a factor that they're looking at. And if that's wrong by 88% then that's a significant stool or leg of the stool that. That they're counting on, and it's just not there.

Adam Van Wie 05:03
Yeah, absolutely. And investors use that number to gage the health of the economy. I mean, there's so much when you have a job that important, and you have a screw up this big, that's, I mean, it's a huge deal. It really is. And, and saying that Trump wanted to fire this person, yeah, because of the he didn't like the headline number. I mean, come on, it's like, it doesn't even make sense. It's just, that's just politics in action. It. It's because of the incompetence, and it makes the whole federal government look pretty incompetent.

Joey Loss 05:36
Yeah, yeah. So hopefully, I mean, hopefully this is another opportunity for people to be like, All right, we gotta. We don't need to be private business, but we need to be a lot more nimble than we've been, because look at what happens when we're not

Adam Van Wie 05:48
Yeah, and if you have that job and you are seeing these wild swings in the numbers based on the set the way you've always done things, well, if it's me, I'm going back and looking at the way we've always done things and maybe updating or modernizing or getting better systems in place, I'm not going to sign off on something that I think is going to be revised 88% it's just, why would you put your name on that? I would never do that. I would I would resign before I would sign something that makes me look like a

Joey Loss 06:22
fool, yeah, well, you said a whole lot like a small business owner. So

Adam Van Wie 06:27
for sure, I think, I think anyone who's been in small business knows how important your reputation is. I mean, it's everything, really, and when you, when you ruin your reputation, you should be, you're going to be out of business, and the government doesn't have to worry about that, because they're their federal government, but maybe we need to change the incentive structure to have them worry about that.

Joey Loss 06:49
Yeah, yeah. Well, it'd be interesting to see what comes if anything of this. Well, let's talk about so we're deep into earnings season, and companies have been beating expectations, but the jobs flub up has kind of made some confusion in the market, and the market did not like the jobs thing.

Adam Van Wie 07:09
No, that that kind of thing creates a lot of uncertainty. And I think that's what you were seeing on Friday. Was just a reaction to that. Well, okay, you said we were here. Where are we actually and can I trust you going forward? I don't know. I'm gonna sell just to protect my downside. Yep.

Joey Loss 07:30
And then, as you said today, there's kind of a bounce back. So I think we're still, people are still trying to figure out, just in general, this kind of, this story of the year is, what is true, and what are the parameters period? I mean, that's the question, right? It's like, what are those two things? And the market, market volatility seems to flare up when we know less about that. Yeah,

Adam Van Wie 07:51
and seasonally, there's going to be volatility, just based on history, around this time of the year, there almost always is, and we haven't seen a tremendous amount in the last couple of months, so not surprising to see a little bit of that, just from a seasonal perspective, compounded with all the crazy stuff coming out of DC. Yep,

Joey Loss 08:13
let's talk for a second about growth versus value this year and over the last 10 years, this is something I've touched on in the past. We had an episode where we had dimensional funds come in and talk about their perspective, which is that, you know, leaning into small value companies, historically, has been the place to see the greatest returns, which, if you look at a long history, that there's a strong story there, and it has outperformed. But if you isolate different points. You know, we're in one of those periods now where value just doesn't seem to be showing up. Another way to talk about value is, if you're leaning into dividend stocks, those are kind of often the same thing. What is going on there?

Adam Van Wie 08:52
Yeah, it's been a really good illustration of the difference between the two and why you should own both. I would say, over the last three to four years, there's examples of why you should own value and why you should own growth and switching back and forth. If you try and do it based on your gut or some other type of analysis, you're probably going to get it wrong. You might get it right once, but you're not going to get it right every time. But if you look back to 2022, horrible year in the market, just awful. And there was the market was down, I don't remember exactly, but something like 14 to 18% but if you own certain value funds, you might have been up that year. So I have, I know, a couple off the top of my head, where, if you owned a good value fund, you would have actually been up in 2022 versus the whole market. The same could not be said about growth stocks in that year. But flash forward to last quarter. Man in some of the value funds that we own were down during the quarter the overall market. Was up over 10% looking at the s, p5, 100 and growth funds were up over 17% during the quarter. So there's, there's good times to own one or the other, but you can't nail market timing, so our solution is just to own both at all times.

Joey Loss 10:17
Yeah, I think that's the right approach, and it is. I mean, it's been impossible. I would have thought coming off tariffs, or even during tariffs season like that, value would have the strongest case, right? I mean, if you try to build a case on fundamentals and economics about why a stock that's already more appropriately priced or questionably under priced for what it offers. Why that should do better in the environment we just saw. I feel like that would have been my bet if I was a betting man in that regard. But the second confidence came back, growth just ran away again.

Adam Van Wie 10:56
Yeah, and did confidence really come back that much. I mean, a little bit Sure, but still a lot of uncertainty out there. You would think owning some like the some of the old guard stalwarts that pay good dividends would be a feeling of safety. But no, everyone's piling into Bitcoin and Nvidia,

Joey Loss 11:15
yeah. Well, and for investors, you know, if you own these big index funds, you know, particularly the S and P, you're getting a split of value and growth. The NASDAQ is probably more growth tilted, but I think there's probably still both in there. Yeah,

Adam Van Wie 11:31
Eileen, I put q, q in our in our growth category, but you're probably right. There is some in there, but it's just so dominated by the big tech names, the mag seven stocks, that I definitely would file it under a growth type of ETF.

Joey Loss 11:50
Yeah. So what do you think? Okay, so now that the Fed has different data, you know, we missed the chance to cut rates. Everybody was putting pressure on them to cut rates in this last meeting, what do you think is going to happen, or what has changed going into the next meeting? Is there a greater likelihood of a rate cut, and what does that mean?

Adam Van Wie 12:10
It was interesting. If you follow the CME fed watch tool last week, it was about as volatile as I've ever seen. On Wednesday after the no rate cut, the odds of a cut at the next meeting went down substantially. And then on Friday, when the BLS showed their crazy numbers that they had that the odds of a rate cut spiked the other way. And it was dramatic. I don't have the exact numbers in front of me, but it was like, I mean that the change on both days was like 60% in either direction or something even greater than that. And so I think now the expectation is probably for our cut, next next meeting, and in my opinion, absolutely warranted. They need to cut. I personally, I don't like, like, I'm not advocating for rate cuts. I don't think it's, I don't think that they need to do this because the economy is headed off a cliff or anything like that. I like higher rates because I'm, well, I'm in this business, and when it's when you have bonds that are yielding 4% or higher, it's a lot easier to manage a portfolio for your clients, so I'm a little maybe even biased towards higher rates, but at this point, I think it's pretty clear that that being a little too tight here could cause some major problems in the employment in that area, and you might see jobs become harder to come by, and that is going to be bad for the US, so I think that a cut is appropriate at the next meeting.

Joey Loss 13:48
Yeah, I think that's fair. And there's nothing wrong with admitting that you don't mind when my people pay your people higher mortgage backed securities interest rates. You can just say it,

Adam Van Wie 13:58
yeah. Well, that's the other problem is the housing market. I'm glad you brought that up, because right now we're clearly seeing some deterioration in the housing market. I don't think it's I don't think it's falling off a cliff, but I do think that it's a huge shift from three years ago. I mean, 180 degrees, like it's turned from a total seller's market to a total buyer, buyer's market. And I do think that needs to come back a little bit more to keep things in balance, and lower rates would certainly help that. Yeah,

Joey Loss 14:32
you know, we've got a house for sale right now, as you know, and I kind of wonder, you know, does does now the greater certainty of a rate cut next month, even though it's not a direct impact on mortgage rates, right? Where it's big difference between the overnight rate, which the fed directly controls, and the actual mortgage rate, which is based on the 10 year treasuries. But is that going to actually make people kind of sit still for a month in the market?

Adam Van Wie 14:55
I could make an argument the other way too, though, once this Fed starts to move. So people could think, well, now they're dropping rates, so I don't want to wait months to buy this house. I'll buy it now and then I'll refine next year for, you know, a point point lower, or something like that. I think it could go either way. It depends how much pent up demand there is for people that have been putting this off for quite some time, yeah,

Joey Loss 15:20
well, from your lips to the buyer's ears, we'll see what

Adam Van Wie 15:24
happens. It'll be interesting follow, because the housing market is has been, over the last five years, one of the most interesting studies in supply and demand economics I've ever seen. Rarely do you see a situation where prices go up when demand is off the charts, and prices go up as demand falls to wherever it is today. But

Joey Loss 15:46
that's what's happened. Yeah, it really does not make sense, not really.

Adam Van Wie 15:50
No, I've been saying forever, either rates need to come down or house prices need to come down, and so far, neither has happened.

Joey Loss 15:56
Yeah. I mean, just in general, this last several years is such a strange period in so many regards. I mean, we saw the worst, one of the worst bond markets ever in history. We've seen the craziest housing market ever. We've seen seven stocks dominate the market and continue to do so. And seemingly all economic environments, whatever you throw at it, those companies just keep growing. And small caps, which historically have been absolute champions over long periods. Well, we're now in a 10 to 15 year period where they're just not. It's a strange time.

Adam Van Wie 16:31
It is. And then throw in the covid shocks to the everything. I mean, it's just been, you know, it's been a really interesting time to be in this business, because nothing has followed historic patterns.

Joey Loss 16:47
And that, I think, the silver lining and it further justifies why diversification matters. This is probably where I think we're batting 1000 of saying that word in every one of these episodes. But it's just true, right? I mean, it's like, if you lean too hard in any one thing, unless it was the mag seven and you were just throwing it all on the table, you know, you've had a pretty good ride despite the craziness in any particular pocket.

Adam Van Wie 17:18
Yeah. And even that in itself, is an argument for diversification, despite the fact that the mag seven has done so well over this time period, that leads me to believe that the odds are even higher that they that may not be the case next year or the year after. Yeah,

Joey Loss 17:36
yeah, that's fair. Laura, what else is top investment news in your mind,

Adam Van Wie 17:42
I think, I think just the amazing rebound we saw from q1 to q2 it was, it was pretty, I mean, this is the second V shape recovery that we've had in five years. It's, it's really unusual, obviously, 2022 we didn't see a V shape that was a much more prolonged downturn and recovery, but then we had the covid shock, and then the tariff shock. And so these sort of, I don't know, government related shocks to the market, and I know you can't blame covid on the government, but it was the government response that caused a lot of what we're seeing in the markets over the next five years. And so it's just really interesting to watch when you see the market fall so hard, so fast for it to not do that slow, steady climb out of the hole. It's been almost as much interest in buying on those as as you can imagine. The buy the dip mentality is really there. And I wonder if that's a factor of so many more retail investors being involved in the market than ever before.

Joey Loss 18:50
I think so. And I think Robinhood deserves a lot of credit on terms of the democratization of investing. It's just so easy to invest now, and Robinhood really led that charge. I mean, they were this. They were the sponsor of $0 trading. I mean, what a big deal that was. If you had $20 to invest, you weren't going to trade. If 25% of it went to a trading

Adam Van Wie 19:11
fee, absolutely not. I remember trying to raise cash for clients on their monthly withdrawals back back 10 years ago, it was so painful, because you were you, you know, they're pulling out 1000 bucks a month, and it's going to cost you between eight and $40 to make the trade, to get that money to them. It was just, it was not a good deal, so I'd end up having to sell a lot more than I wanted to. And, you know, planning ahead, but then you're sitting in cash and not making any return. And so you feel like you're you're doing a disservice to your clients, but it just was this made everything so much easier. And I think the vanguard and Schwab and Robinhood deserve a lot of credit for driving those fees down to zero.

Joey Loss 19:56
Yeah, I think so it's just never been cheap. I mean, you. Can own. You can have $10 go on any one of those platforms and buy almost a zero fee fund that owns 1000s of companies. That's

Adam Van Wie 20:12
incredible. And you're just you've gotten people that have never been interested in owning stocks out there buying the dip. And I think that's great. I think that that's outside of owning a home. It is probably the best wealth building tool available to anyone and who lives here. And I think that's great. I think we need to encourage that and to to I wish we could teach it in schools. That would be fantastic that I think a lot of kids learn about home ownership and the values of that, or at least so many kids learn that. But I think very few, unless they come from a family that owns stocks, learn about how to invest, why you invest, and the benefits of it for you.

Joey Loss 20:59
Yeah, certainly. And the community around Robin Hood and later, Schwab and fidelity as they jumped on board, really like the online Reddit communities and things like this. I think that's where a lot of the buy the dip mentality comes from. And it's almost like, I mean, if I just think about what I've taken in through my eyes over the last 15 years. You know, from 20 to 35 or 33 whatever I am now, it's all the same. You know, it's, it's almost like the crypto community started this whole buy the dip. Hold on for dear life. You know, they were just putting their own spin on long term investing. I'm not endorsing some of the things they were saying to do that with, but that community just spread like wildfire. Now there's Reddit, there's forums, there's all these other places where, for the first time, I know of young people are just wildly interested in this topic, and I do think that that plays a role in what we've seen in these V shape recoveries.

Adam Van Wie 21:57
It certainly hasn't hurt. I can't prove that theory out. But I, I agree with you, yeah,

Joey Loss 22:03
totally anecdotal, but just just my experience, and for listening to friends my age group, it seems like that's kind of what's going

Adam Van Wie 22:10
on, yeah, and the amount of young people that have Robin Hood accounts now is, is, I mean, when I was 22 I had a 401, K with like, $7 in it. But I wasn't thinking about, I mean, AmeriTrade, and those types of things were just starting to become available, and it was interesting, but I didn't have any money to put in anything, and plus, you had to pay a $15 trading fee. So it just wasn't worth it to me. It's a totally different story today.

Joey Loss 22:38
Yeah. Well, to wrap it up, what do you think? I mean, you've mentioned in a couple client meetings now, seasonality and investing. What do you what do you see through the end of the year? At least, if history is a guide, what do we think we'll see?

Adam Van Wie 22:50
Yeah, I think we just said that nothing is following historical practices here.

Joey Loss 22:55
So let's look at history and say it as a prescription. There we go. But,

Adam Van Wie 22:59
but. But if you do look at it, this time of year tends to be volatile. I think going back a few years, it was when literally, Wall Street traders got out of their Hamptons houses for the summer and went back to the street and were were trading on the floor of the exchange. That's probably not the same thing today. But for whatever reason, this, this time of year tends to be more volatile than other times and has a lower percentage of positive results through the years. So this month and next month in particular, but the latter part of the year, the fourth quarter, tends to be a really good quarter in the market, you have the Santa Claus Rally, whatever you want to call it. It just from a seasonal perspective, it tends to be one of the better times of the year, more higher percentage chance of a positive result. And so if we, if we were to follow up pattern, that would be one that I would be okay with, you know, some volatility in the end to end the third quarter, and then strong into the year, I think it could, could end up being a good year, if we saw something like

Joey Loss 24:03
that. Yeah, is there any trade there? Based on that, I

Adam Van Wie 24:08
wouldn't play those odds. I think there's too much going on politically, too much going on in the markets. I just, I don't think it's a sure thing. And I wouldn't, I wouldn't bet on it. Yeah, I think that's wise.

Joey Loss 24:24
As you said, History doesn't always play out. We have no idea if that's exactly what's going to happen, but I it is interesting to know historically what, what the seasonality looks like year to year.

Adam Van Wie 24:34
Yeah, and that's, I mean, it is a, it is a trend that has held in many years. I just don't know if this will be one of them, we'll, time will tell. Yeah, well,

Joey Loss 24:42
I think we'll get another one of these in before the next Fed meeting. I doubt. Do you think there's any chance to do an emergency cut based on the new date new data? Are they going to wait? I think

Adam Van Wie 24:51
there's a 0% chance that Paul does

Joey Loss 24:55
fair All right. Well, let's, let's cut it there, and we'll check base in a couple of weeks. See. What's going on

Adam Van Wie 25:01
that sounds good. Thanks, Adam, thanks for having me.

Joey Loss 25:09
Thanks for joining us. If you enjoyed the podcast, please consider sharing it with your friends or family. This is the best way to spread the word, and we want to keep churning out great content for you guys. Show Notes and episode transcripts are available on our website at strives wealth.com/podcast Special thanks to bode Lee Sins for the intro outro music and to the podcast man for producing this show. Until next time,

Disclaimer 25:35
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.