Why these special Purpose Acquisition Companies are so hot and what the phenomenon says about froth in the market. And golds record rally. Is the yellow metal poised finish even more gains . On the barrons roundtable, my colleagues. So, jack, this week was interesting. Four very powerful dudes get hauled up in front of congress, theyre asked some dumb questions, some tough questions, the market shrugs, the next day they come out with earning, and three of the four stocks soared. Yeah, actually rose during and after the testimony and end then again after results. The stock market this week, if you look at the s p 500, it was up close to 2 . Now, thats a wonderful result, but its particularly great when you consider the backdrop. What did we learn this week . Gross domestic product, the economy shrank 9. 5 from the quarter before. If you feel compelled to annualize that figure, yes jack no, please dont 33 , right . Either way, its the housiest number in 70 years of lousiest number in 70 years of recordkeeping, so why would stocks rise with that backdrop . Look at the 10year treasury yield. You know its low, right in but its lower than you probably thought if you havent looked in a while, its just above half a percent right now. Deutsche bank did some digging around, they figure thats the lowest borrowing rate in 236 years. And thats a tough environment if youre trying to get income. Thats why people keep flooding into stocks. And then you mentioned those tech giants. Those results . I mean, amazons profit doubled to 5. 2 billion for the quarter even on higher spending. Apple had great sales growth even though so many of its stores were closed. So, you know, i would just keep an eye on valuations. It was only six years ago that i was writing about apple. Think you might be a good deal at 12 times earnings. Its over 30 times earnings right now, so watch those prices. Jack and the one thing, while that gdp number was awful, it wasnt a huge surprise, we knew it was going to be ugly, but right now were seeing some flattening in some of those High Frequency indicators, everything from how many people are going outside and traveling to other stuff. As jay powell said he was actually watching. Its not all smooth sailing ahead, right . Well, one thing i can tell you about gdp i dont think youre going to see a worse number than that. I would hope we dont see a worse number in our lifetime. Think back, what did you do in april, may and june . I did like this and maybe watching some netflix. I did, like, nothing. I think a lot of people, thats the case. Im doing more things now, and its more economic activity, so, you know, were not in great shape yet, but were beginning the mend. So it remains to be seen what happens you know, there are signs that the recovery isnt quite as fast as we had hoped, but hopefully the process has started. Jack so you mentioned some of those earnings in tech getting a little high. Carlton has also been looking into an area of the market that says to me things might be getting a little frothy, these are these spacs. Can you explain what they are, carlton, and why should we be looking at them . Special Purpose Acquisition Companies. Basically, a Blank Check Company that goes public with the intention of acquiring another company, typically within two years. Theyve been around for some time. This year theyre outpacing traditional ipos. Some companies that have gone public this way are draft king, virgin galactic, and the surge come when you have a bunch of Companies Going public via the traditional ipo route, but on the investor side Interest Rates are low are, there are few publiclytraded growth companies. There arent many of those opportunities. So investors are really itching to swing for the fences there. Most recently activist investor bill ackman launched the largest ever, raising about 4 billion. Hes looking for a mature unicorn right now. Jack and one other person whos jumping into the game shortly well hear about a spac from money vault, a Value Investor when it came to choosing baseball players. Well see if he can do the same with stocks, radioit . Absolutely. Jack with all of these things, it suggests one ought to have a little conservativism in their investing portfolio. Reshma, gold is just the thing, right this. Yeah. As a real asset, gold is almost on the other end of the spectrum for, you know . We saw gold hit a record high, up 30 beating just about every other major asset class. Its one of the few asset chats reflecting the anxieties that main street as the u. S. Grapples with the virus and the economy is hurting and were having real questions about the pace of the recovery. Throw in the political uncertainty, its easy to see why investors want some insurance. Their options are limited. Gold doesnt yield anything, but thats still something with record low rates and negative yields, like 16 trillion of global debt. And we have the risk of inflation and weakness on the dollar. And, you know, while the government is having a little difficult few printing money, its a little harder to mine gold. Newlymanipulated metal adds just 2 annually, so all of that should add to golds luster. Jack real quick, back in september 2018 gold was about 1200. Barrons recommended it. That same writer has a story now where he says stick with that trade, list three quick investments, and well move on. Sure, glp and iae and then a gold mine etf for the miners. Jack coming up, nikola founder Trevor Milton on why he thinks his trucks will be better than teslas. Thats next. Jack investors sent any colas shares storing, but its not yet sold a single truck. Joining me now, trevor millson. Thanks a lot for coming on the show. Your plan is ambitious, you want to to build big trucks that run on fuel cells, but right now hydrogen is about four times as expensive as diesel. Why do you like fuel cells, and how can you make this actually work . Yeah, thats, that was the big problem we tackled. Thats why we came into the market. We saw an opportunity to bring the cost of hydrogen down, its the first time in history thats been able to be done. So it went from about 16 a kilogram, and were down to about 4 a kilogram. Thats one of the reasons. Jack you just sell hydrogen stations. Actually, we tell people were an Energy Technology company that happens to build really cool vehicles. So the reason why we build the semi trucks you need a balanced base load every day of hydrogen stations, or youll lose all your money. Theyre very, very expensive, and if you dont have thousands of kilograms a day running through those stations, they essentially, the maintenance just goes through the roof. So so thats why we designed the company the way it was. Jack so we just showed a big rig cab on the screen but also the badger. Now, the big rig cab i believe youre building with a european partner . Is that right . Yeah. So we yeah, we partnered with case holland are, theyre one of the top five largest truck manufacturers in the world for semi trucks, and we actually have a factory in germany right now coming online, and five of our first prototypes coming off the Assembly Line right now, and well be in production middle, to the end of next year with. Well be the first ones out there in production. Jack and were also looking at pictures of the badger. Those images look pretty cool. Its a beautiful truck, definitely very well designed. Itll be built with an oem partnership, and we hope to announce that a couple month prior to december, so in the next two monthsish is when were hoping to announce that partnership. Jack that seems like something as a Public Company you would want to share as soon as possible with shareholders, no . I would love to right now. [laughter] this ones not on me. Its around, unfortunately, when youre dealing with very large companies, it is, theres a lot of p. R. Teams involved, product release dates, legal involved, filingses with the sec, so were probably 60 days out or less, and the whole world gets to know whos building the badger with us. Jack so, clearly, investors are putting their money in your company hoping itll be the next tesla, right in the stock zoomed from 10 to 93, its now settled around 30, but thats still a 200 percent gain on the year. You name your company nicola after nicola tesla, the same guy. Youve got a huge twitter presence, but some have accused you of being more promotional than truck building. The rcm said youve got more of a Business Plan than a business. Whats your response . As okay. Thats okay. Im a creator, i love building things. We built this company from my basement. Its a 12 or 13 billion company today. Its publicly traded on the market. You know, they may not like our Business Plan, but its not just a Business Plan. Weve got some of the Largest Companies in the world partnering with us, and its kind of a cheap shot. I mean, look,s weve got to prove it to them, and we have trucks coming off the line, trucks being driven every day, being tested and production beginning next year. Factory just broke ground last week. We have so very exciting times, and we have, i mean, i dont know what else you could do than just execute, and thats our Business Model now, weve just got toess cute it. To execute it. Jack not only do you have, obviously, tesla, but volvo e and these old School Companies who have been a little slow to catch on, but dameler and volvo formed a partnership, how do you beat back competitors . I think its great. It shows nikola was the first, the pioneer on it. Everyone else said it was a fools err rand, and now they are going hydrogen. Theyre all following us because it shows everyone that our Business Models actually accurate. Heres the key though nikola makes wherever you buy a diesel, youre going to spend 150 grand on the diesel and spend about a Million Dollars for the fuel over the life of it. We have hydrogen revenue, so when we sell a truck, we can make between 750,000 to a Million Dollars a truck in revenue, five times the amount of money our competitors work. So our Business Models a very creative one that sucks all the money out of the oil industry and brings it right into initiation ka ny nicole la. Jack that is a very different model. Trevor milton, thank you so much for coming and talking to us. Yeah, thank you so much. Appreciate it. See ya. Jack coming up, barrons exclusive reactioning of the best performing looks like they picked the wrong getaway driver. Theyre going to be paying for this for a long time. 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How to build an indoor Obstacle Course plus. Whatever shes doing. And me, jade cattapreta. The host of es the soup camp tonsafun. Its like summer camp, but minus the poison ivy. Unless you own poison ivy. In which case, why . Just say summer camp into your xfinity voice remote to join. Muck if. Jack market volatility put robo advisers to the test this year, and so far theyve passed. An exclusive barrons ranking shows which performed best. Deputy ed editor alex yule. So these automated portfolios came of age during a decadelong bull market. So the market crash this spring was really the first time theyd gone through the wringer, and they merged looking pretty good. Yeah. I think we all wondered how they would do, and ive got to say i think we now know the answer. They performed well. The average robo portfolio that we looked at was tracked by a group we work with, it was down just 2. 9 in the First Six Months of the year. Thats both a mix of stocks and bonds. 2. 9 2. 9 is pretty good, plus a lot less volatility along the way. Hey, alex, its jack howe. Just for the benefit of people who might not know what a robo adviser is, and thats not a confession on my part, im canning for other people here. If im an index fund investor, what does it do for me, how much does it cost, is there an actual robot that will come to my house and whisper hot stock tips into my ears . I can arraigning that for you, jack, but i think its worth thinking about of it as an evolution in the index fund, the target date fund, right . They are putting your into index funds, for sure, but theyre first doing a Risk Assessment all online, and then theyre going to put you in an Asset Allocation that they deem most appropriate based on your racing tolerance. And then risk tolerance. Then its all a automated. Basically, theyre trying to do and i think somewhat successfully a lot of what the traditional human advisers did on the Asset Management side and more and more on the Financial Planning side. Jack you worked with benchmark to rank these guys. Can you give us an overview . Yeah. Back in benchmarking, in fact, the top performer based on its twoandahalf year annualized or trailing year is a smaller robo adviser, i think less than a billion in assets under management. They also work for some of the bigger market banks, but their performance was off the charts. You also had two names in the top three, Td Ameritrade and fidelity go also did very well. Td ameritrade the particularly on the Financial Planning front and few dellty go being fidelity go a steady performer. We at a point where you would feel comfortable recommending these guys to your family and friends . Weve been writing about the robos at barrons for probably five years now. I feel like especially having seen how they did in the volatility and the turbulence are, i think you can recommend these things. I think the most important notion is that they test people invested, they test people involved in the markets. It would have been very easy to sell in march alongside for you, basically, you couldnt get out, it would be harder to get out. They encouraged you to stay, and people got the rewards when stocks came roaring back in principle. Jack thats an important point. Everyone said, oh, theyll do great in a bull market, but when things turn south, everyones going to sell. But they didnt. Carlton, youve got a question. Im just curious, with so many robos occupant there, how do you choose among them . What would you make your choice . Yeah, we tried to look at that, and benchmarking helped us. Wells front was the first ones to do this, i would say, you know, betterman is probably still a good choice for the firsttime investor. Theyre very digital first, theyve got some good tools there. Youve got a more complicated situation, interestingly, we would go and suggest vanguard because of their mix of live and digital. And wells front too, its still a pretty important player, and theyve done a lot around planning for multiple goals like buying a home and retirement, and theyre also offering a new tool that lets you split your paycheck because, by the way, these guys are involved in banking too. So you can split your paycheck into different buckets like bills, savings and retirement. Jack one important point, alex are, when you referenced the performance of the portfolios, of course, one can make a smart Portfolio Allocation that doesnt do as well as someone elses just because you were diversified in something that didnt perform well. Foreign stocks havent done great, but over the previous ten years everyone who was in foreign stocks was very happy about it because the s p was flat over ten years. As you get older, more complicated financial situation. Are these things really good enough . I think thats what were trying to figure out and what were starting to see. And i think added human advisers, these things are really not robo anymore in the way we first thought of them. Theyre much more hybrid advisers, so its a mix of digital advice and human advice. There are different tiers that you can be a part of here, so theyve really broadened the scope of it. You know, if youre i think for most people these robo can become increasingly useful in terms of your Financial Planning and your savings. Jack thanks a lot, alex. Up next, round table members giving 1 in 5 people you meet wear dentures. Yeah. That many but right now, is not the time to talk about it. So when youre ready, search my denture care. Poligrip and polident. Fixed. Fresh. And just between us. All otc pain relievers including volthave one thing in common none are proven stronger or more effective against pain than salonpas patch large theres surprising power in this patch salonpas dependable, powerful relief. Hisamitsu. Jack so, jack, did you spend six hours watching every single second of that hot testimony in front of congress by the tech giants . I spent some of that time shopping on amazon, but i caught a bunch of it. The house antitrust subcommittee and, yeah, the showers rallied, as we shares rallied, despite the Video Conference scolding. Why would they think this group is going to crack, i dont know, it might have been the 21term house member who seemed to confuse facebook and twitter, could have been the 30second shouting match that broke out amongst house reps that had nothing to do with technology. But i think when you look at the chiefs of these four companies, together theyve got market values collectively of close to 5 trillion. Coincidentally, 5 trillion might be the budget deficit that that congress runs this year. I know theres a pandemic, but not nearly all of that deficit will be due to the pandemic. I think theres some investors wondering who should be scolding whom on objectionable performance. Jack yeah, that congressman has been in congress longer than Mark Zuckerberg has been alive. Two quick actionable ideas. I will start with you, carlton. Its kind of techie. Sure. Looking at mastercard. Continued efforts in Contactless Payments which are going to be a huge deal going forward, and also recent Revenue Growth in its cybersecurity and Data Analytics offering, so its hooking interesting. Jack and, reshma, an interesting story on the chinese consumer, and that led you to the stock pick of an american company. Estee lauder, play on the recovering chinese consumer. They still favor premium products, especially skin care and cosmetics. Possibly for all those video calls were doing. Jack thanks very much, everybody, great insights, as always. To read more, check out this weeks edition at barrons. Com. Dont forget to follow us on twitter. Thats all for us. Wear your masks, be healthy, and well see you next week from the fox studios in new york city, this is maria bart row mows wall street. Maria happy weekend, everyone. Welcome to the program that analyzes the week that was and helps position you for the week ahead. Im maria bartiromo. Coming up in just a few moments, blackrocks global chief Investment Officer rick reider is here to talk about the federal reserves decision to keep the Interest Rates close to zero. Later on, cofounder nancy lazar rows here to talk about a what she expects for the second half of 2020, you will be surprised at what shes saying now