Transcripts For FBC Making 20240703

Fourth quarter is underway but investors are facing a wall of worry. But so far the script hasnt changed. Growth stocks higher, bond yields in orbit. Confusion. Were trying to tackle this. Weve got the issues facing with us and wonder if it is happening during the calendar. Well break it down. Blackrocks larry fink is not helping the situation. He says he sees more fear than anytime. Anytime . Why these billionaire masters of the universe expressing fear . Im not sure that is how they got filthy rich. Tweet me cvpayne. Are you buying that . The modern day scab, worse than toads and vampires combined. I will explain that later in the show in my take. All that and more on making money. Charles all right, so we can put a Government Shutdown on the backburner. Lets face it, despite the hype nobody really cared, nobody on wall street really cared about that instead i have the list here of the top concerns for investors. Here is what is interesting. Recession last month came in a little bit from july. Still number one, still number one. Were really concerned about the recession. Inflation didnt change, number two. Kind of odd, inflation on one hand, recession on the other. This is really amazing. We talked about this two times on the show. We had had amazing guests. Commercial real estate is nowhere on the list in july. There was no blue line for that. All of sudden it bolted to the number three most significant concern. Interest rates going higher. Were kind of concerned about that. That is really about it. Sort of the same names jockeying for position here. Speaking of jockeying, 2023 so far has been absolutely amazing. It has followed seasonality this script to a t. This is where we are right now, right here. You see this little bit after hook, if this works we could be barnburner of rest of the year, monster, monster rally. Again if it works. What you can see seasonality has been amazing. Speaking of amazing, bra vowed dough of the bond bulls are starting to wither. Net outflows, you see that negative selling, negative selling of tnt the first time weve seen this year of that. I want to bring in rio ceo lance roberts. Lance, we begin the Fourth Quarter what are your biggest concerns right now . Basically the concerns are kind of behind us. We had two weeks, two months of rather, selloff in the markets. Lots of concern over government shut down. Heading into the end of year i think we Pay Attention to start of student loan payments. Will weigh on retail sales most likely. Higher Interest Rates, when does that create another problem in the markets . Back in march we had rates where they are now. Regional bank crisis. We have forgotten about that, that risk is still out there right now. I dont think you can set that aside entirely. Charles tlt, weekly inflows, bond buyers have been supremely confident, you see this selling first time this year, could be a good sign, reveal the fact this is not the easy slamdunk folks would thought it would be . It has not been a easy slamdunk. It is interesting despite higher rates all year long, people have been buying bonds. We had large bond inflows all year. One thing dragging on rates is heavy shorting. We have record short positions sitting out against long bonds right now as well. Somebody is going to be wrong here. Either people who have been long all year or these shorts. My bet would be ultimate thely shorts are going to be wrong. If youre going to have recession, yields fall, bond prices rise. I probably bet on the long side. Charles sounds like you think recession in the next six months . No. Probably, look, there is reasonable expectation well have a recession next year. I would suspect it will be somewhere maybe third, Fourth Quarter of next year. Could it come sooner . Absolutely. If the fed hikes Interest Rates again. If Interest Rates spike on long end could impact the economy. A lot of momentum behind the economy t will take time to slow that down for negative activity. Maybe the latter half of next year. Charles talk about the equities market, stock market you talk about the 1 50day moving average here. Were bouncing off that level now. Were in a tight range. On up side 4288, on the upside, 4195. This is parameters for significant move on either side of those . If we get above the 50day moving average. It will set us back to decent rally toward the end of year. 4500 for the s p. That is my target for the year anyway on the upside. On the upside 4200 should hold. That is not far away from here. We dont have a lot of downside risk. After two months of selling, we have seasonal summer weakness. Right now we have very negative sentiment, technicals are very oversold. Were in a very good position here for a bit of a countertrend rally over the next month or so i think earnings will come in. They will Beat Estimates because we lowered estimates so much. Charles right. We have five billion a day in stock buybacks starting in november. Charles before i let you go, topic of earnings, interesting earning estimates have gone up. It is interesting because the market usually leads earnings. The stock market went down. Later on earnings went down. Stock market went up first. Earnings have gone up. Now the stock market is going down. Do you think earnings will go higher . I happen to think earnings will go higher this time. History tells us usually price precedes the actual earnings . The latter part is right. We will probably see some reduction in these forward estimates. Again higher Interest Rates are going to way on interest growth and Economic Growth next year. Estimates are a bit high. They have to come down. That doesnt mean you will have a major contraction in earnings but they are a bit exuberant for where we are in this current cycle. Charles lance, always great talking to you, thanks so much. Thank you. Charles strike level we havent seen in two decades the word scab is back in the he vernacular. I have a brand new meaning. Wait until you hear what it meant before and what i think it should mean right now. Lets wray in main Street Asset Management cio erin gibbs. I pick up on the earnings situation and seasonality. Let me pick up on the first chart, it has been absolutely amazing. Seasonality, third year of a president ial cycle it has worked to a t. Can it keep going . Absolutely. I think we could have another couple weeks looking at fears just like you showed. So i dont think it will happen lets say immediately. It will start off with the very beginning of october but i think if were looking at Fourth Quarter absolute returns i think we should look at ending the quarter up. Charles ending the quarter up . Yeah. Charles yee earned rally . I believe a yearend rally. Charles it is almost there . Yeah. Charles the wild card has been the bond market. Yes. These bond yields are absolutely amazing. One thing that is interesting, before we get to the bond market i want to talk one more thing for the audience this is another thing intriguing when september is down, obviously september was a really ugly month the rest of the quarter is up pretty good. Median up 5 . Average up 2 . Works 79 of the time. Again history is on our side . Absolutely. The two factors we have to worry about, for me the two biggest concerns the one, fed gets more hawkish and we think rates will go higher and that as you know adjusts everybodys thinking. The other thing would be increasing consumer weakness because we have been holding up well because of the strong u. S. Consumer and i think that would be a real worry. We could take recession fears really become real. Charles but can you have both though . One will have to give. If the consumer doesnt get weak the fed is going to get hawkish. Exactly. Charles which one is preferrable . Probably at this point the consumer we dont want the fed to raise rates and reset valuations all over. Charles talk about the bond market this drawdown, this is the sharpest drawdown in bond market history, 38 months. Bonds peaked in august of 2020, down 17 . If we gone back to july 2020, you said the next three years would look like i would ask a Million People on wall street, hell no youre out of your mind. Three years after bond bear market . No one saw it. Charles what does it mean . Is this anomaly . A new paradigm . Is this a 40 year bear market or unique because of the unique circumstances weve had . I think it is unique. Inflation is stickier than we have ever been before. We are three years into this bear market. This could easily go another nine months. Charles wow. How are you jiggering your portfolio . I know that is wall street term, jiggering. You start getting fancy with duration. Short term, one, three, five years, to long terms, 10, 20, 30 years. In general your prices dont move as of when youre talking about short term but you get lower yields. In this case having less downside on the actual bond prices is useful even if youre getting a lower yield. Charles right. I would say charles everyone is loading up on these bills, right . Yep. Charles i saw some numbers outrageous. To your point, get in short term, get in and out. It is a safe haven right now. Right. Charles speaking of things changing the 60 40 portfolio from 1975 to 2000 unstoppable, absolutely unstoppable. Yeah. Charles unstoppable from 2,000 until recently but this is the last time it didnt work. Were in a similar situation where you have stocks so significantly outperforming treasurys that you know, it was unfavorable for 60 40 portfolios. I did this a lot on the show last year. Almost everyone come back it will work. Are your clients okay with the 60 40 portfolio, 60 stocks, 40 bonds . No. I strongly believe being more tactical. A, you need to adjust as youre getting older and your cash flow needs are. Charles that would be more bonds according to the old script. Would you be even in more bonds than 40 of your portfolio . If youre overretirement age, over 75 charles what if youre a young whippersnapper like me . Exactly. 60 40, 40 years old, 60 equities, 40 bonds. I think if youre 40 years old youre not expecting to need that cash flow for 20, 30 years, you could easily be in 100 equities. You just have to be willing to take on that risk. Right. For those ups and downs. We know these past three years the ups and downs could be big. Charles 75 to 2000. It was awful. From 2,000 to 2020 it was amazing portfolio. Right now it is looking awful again. Maybe risk is too comfortable paint by numbers with 60 40. Things are always changing. You cant always rules from the 70s, and adjust your play brook. Charles thank you very much. Technology rebound, under a little bit of pressure but some people walked away. Beth kindig and forest here on tech answers. Leading the way still. I know people on the street hate it but what is the alternative . Blackrocks larry fink sees more fear than anytime in miss professionallal career. He has been in the business for 50 years. Im not buying it. I will ask don luskin if he is buying it. This is Spring Semester at over 13,000 us school districts, which have become top targets for Ransomware Attacks. But theres never been a reported Ransomware Attack on a chromebook. Which is why thousands of schools like the fairfieldsuisun Unified School District switched to google tools for education. So they can focus on teaching and 22,000 students can focus on learning, knowing that their data is secure. your brain is an amazing thing. 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Larry fink, the guy, blackrock, larry fink, says i see more fear than anytime, anytime in my Business Career anytime in his Business Career . I mean i was wondering was the guy making a make America Great hat at taylor swift concert, he was that afraid . I want to bring in trend macro chief Investment Officer don luskin. Don, between this, jamie dimon talking 10year yields at 7 , what are they seeing from the ivory towers on wall street as they look down among the the peons . Larry fink, media demands constantly he has something to say but he has nothing to say so he says things like that. That was the most ridiculous statement in i have ever siege was he not in the global melt down or wait, talking some other kind of fear . Fear that human life on earth will become extinct from Global Warming and human civilization will collapse in racism, White Supremacy and patriarchal tyranny if we dont buy blackrocks esg fund. Maybe that is the fear he talks about, the fear he himself takes. Charles i think they will name sitting else. They will get away from esg they will have a new fund name. I cant wait for this acronym. It will be something fantastic. Listen, they make a lot of money, when everyone else is afraid the masters of the universe get wealthier. You were cautious last time you were on the show. Yeah. Charles at that time, during this time period youve become cautious look at swell of folks saying there will be a soft landing. I mean, are you feeling a little more constructive these days . Are you ready to get on the soft landing bandwagon . I have never not been constructive about the macro economy. Im even bullish than that. I thought we would never have any landing at all that. Is different from what the stock market would do. I guess im more bullish than last time we were together, charles, well, s p is down 10 . Easier to want to buy them when theyre a little bit cheaper, right . Charles yeah. I think this is more to go in this move but you know, im not worry ared about any landings and at the end of the day it is the economy that supports the stock market so were going to be fine. Charles speaking of ivory towers and folks who have a lot of power, the federal reserve, you know, i got to ask you about this, so the top 20 of households obviously they historically owned treasurys. So theyre doing very, very well. Looks like the fed looks at aggregate data before they make a decision, it has to get bad, folks doing well have to do bad. Even more than that, don, corporations, right . Corporations we know borrowed all this money for zero. They have all these treasurys. Here is the irony, their payments are actually going down, their net corporate payments are down making more on the Interest Rate than they owe f theyre talking about breaking anything, they will break the public long before they break Corporate America . Yeah, it is all very tricky because on the one hand when yields go up thats an opportunity for people who derive their incomes from those yields to get more money. Thats fine but at the same time, if you are one of the wealthy, for instance, a big, wealthy bank, not just an individual, who owns longterm bonds as a longterm investment over the last couple years a longterm treasury portfolio has lost as much as 30 of its value because of this backup in yield yes for the new dollars invested youre making more per annum but the value of your invested capital has been decimated we literally never seen in longterm income in the history of the data. You can go all the way back to the volcker period when the 10year treasury yield got up to 15 . Sure it did, but the backup in yields hasnt been as rapid you about didnt start at zero this time. The rich are happy, but the same people rich people are bad. Depends which part of the Balance Sheet they look at. Charles well leave it there. I had a table how devastating the bond drawdown has been unique it has been. Don, really appreciate it. Thank you. Charles a reminder im hosting a special edition of making money, called unbreakable investor, based on my upcoming book on october 19th 2 00 p. M. You can join me here in the studio in new york city. It was absolutely standing room only. A new block of tickets opened up. Go to eventbrite. Com, search charles payne. Get your tick contest down here and have a blast. Kim forrest is looking forecompanies with longrange plans for growth. She wants companies with vision. She will share the winners at 2 30. Analysts still bullish on nvidia but you know what . The street is a little wishywashy. Beth kindig is on this. I cant wait to hear her thoughts as nvidia tries to fight back. Explore endless design possibilities. To find your personal style. Endless hardie® siding colors. Textures and styles. Its possible. With james hardie™. woman what if my type 2 diabetes takes over . 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With the money i saved, i started a dog walking business. Oh. [dog barks] no its just a bunny only pay for what you need. Liberty. Liberty. Liberty. Liberty. Charles so we know for a lot of this year, tech, communication services, you know those megacap names . The rally in them was used as a reason not to be in this market but is that really smart . I want to go to kelly ogrady. She has a lot more details, kelly. Reporter charles, it is not. The curmudgeons are using outside influence of technology as a excuse for missing this rally. The thing is 2023 is not a new phenomenon. Bull markets in tech go hand in hand. S P Technology Sector has outformed 87 , two of 23 bull market cycles, however, a big problem for tech haters has been where to put your money, finding Something Else to own. This year the alternatives run the gambit from value, defensive, cyclical to bonds. I can assure you some of the mavens missed the rally led to counteract activity growth. Goldmans trading desk reported that info tech was the most bought sector last week. I want to point out two things to you. This is the net flow. That started to go up this is the short flow. If these cover, that is going to be huge. Now this repositioning may have a lot to do with earnings season, my favorite time of the quarter because im a huge nerd. This it is just around the corner and the street is expecting revenue and earnings to erupt much higher especially in tech, right . This is q3 here. Now, i want to show you though, what this looks like without the magnificent seven, magnificent seven, right . , how powerful influential those stocks, apple, google, amazon, nvidia of course are for the market without them, right, this is what it looks like. That Broader Market would be in a earnings recession than the Current Quarter rather than the last quarter. So you can see here how big of a an effect that has. Now, lastly, speaking of earnings season i want to talk to you about a. I. , right . You hear on all of these calls, a. I. Mentioned tons of times, right . But, youre starting to see this dropoff. You cant really see it but i promise you charles, there is a little bit of a drop here. They might be mentioning it a million versus a million and five. Charles yeah. Were definitely going to be watching the tech stokes and im going to be counting, tallying how many times these Companies Mention a. I. In this earnings season. Charles you will be real busy. Even if they tailback a little bit you will be busy. Thank you, kelly. Io fund lead tech analyst beth kindig. Beth, this morning nvidia got an up grade at goldman, longterm conviction. Citi likes technology. Before i get to that, this last chart was a hoot, right . You can see a little bit of a tailoff in a. I. Being mentioned in these earnings calls. Is that a negative omen or a contrarian move . The buzz is definitely settling but again like you pointed out nvidia is getting upgraded because out of all the companies this is the one company that has been the power of the a. I. Economy. There is certainly us about. The private markets definitely participate in the buzz. Then you have your ipos participate in the buzz. Then you have your midcap stocks that do but then you have these megacap stocks moving very quickly on a. I. Were starting to see an impact on profits. Nvidia, there is no doubt they have doubled, tripled, almost tripled data center revenue. They have definitely doubled it. When you look at the numbers there it is very clear that nvidia is doing something important. Charles youre of course a long Term Technology investors, Long Time Technology investors. Last couple shows i wouldnt say you were a curmudgeon you started to say, hey, you know what, you got a little hesitant. Are you still feeling like there is time for a pause there . I do. The one thing about curmudgeons they can be very good at Risk Management. I will join them very briefly when i think tech is topping out. We had a phenomenal run in tech, magnificent seven as your associate pointed out has been moving this market. We like to buy at lower prices. Were a all tech portfolio, exclusively in tech. We think it is crazy to be positioned for a soft landing now. Were using Risk Management tools. Charles let me pick up on that. You say it is crazy to be positioned for a soft landing. Are you anticipating a recession . We think a recession is coming. That is the way were going to position. Were prepared to hedge up to 100 of our portfolio most likely q4, q1. Charles wow. Let me ask you about intel. You had a great note on that in your most recent piece i saw. Technically it is bouncing off the trend line. The company has a really intriguing story right now. Share that with us. Intel is a company that has a design angle and then of course a foundry and we want foundries on american soil so intel is a great choice for that. Where they have stumbled in the past, i should say they have actually have a great gpu coming into the market that can eventually undercut nvidia on price. They wont have the Software Development that nvidia has which is kuda. Im hesitant for them as design company, weve seen stumbles about ice lake and Sapphire Rapids release delays. They cant make that mistake moving into the gpu market. Charles it is one to watch but not there yet . It is a potential rival for the thrown but not yet . Correct. Charles all right. Hey, beth, thank you so much, always learn something from you as well. Thank you, appreciate it. Thank you, charles. Charles bring in Capital Partners founder cocio kim forrest. Kim, let me pick up on that because i know that intel is a name that you happen to like here, right . Absolutely, and i was thrilled to get beths take on it and i largely agree it is a longerterm story but maybe not for the same reason she did. Charles why do you think it is a longterm story . Well, a lot of it is the fab, foundry portion of their business. It is just going to take time to build this is not just designing a new chip and you know, using what you got. This is building buildings, some are in ohio, some are going to be in germany. It is a very longterm play and if you believe that the company can resurrect itself and be the great maker of chips again which we do, you would buy it occasionally and hold it for a very long time. Charles all right. I got to be honest with you, i go back to the intel inside days. I thought they got too pc centric for too long. I think they have a lot of catching up to do. I will watch for right now. Okay. Charles micron is also on your list. That is intriguing. The stock pulled back last week. There is good news, bad news, micron is one of these things that seem to be hit or miss. You like it on weakness now . We do like it as it drops lower. We think it will probably peak in about 18 months. And why is that . Well, there was a huge amount of overproduction for one of its Core Products which is storage related. It is nand. The company is also making products for the i have a eye market because a. I. Needs unbelievable amounts of data and it needs to access them rapidly and micron is making despise devices for that. It takes time for the commodity part of their business to kind of build steam again after all the pcs that were bought in the early 2020s. Charles and finally i got a minute to go, coke is on your list but this is like the new coke, no pun intended . It is the new coke. Its the new coke that you can buy your favorite mixer already mixed with alcohol. I think theyre a very savvy company that uses technology well. Something i didnt write about in my note but i think it shows in their margins certainly they are outperforming their biggest peer, pepsi. Theyre going away from fizzy drinks, you know, carbonated drinks and doing unusual things with the carbonated drinks they have like adding alcohol. Charles you mentioned adding alcohol. Any stock become as buy. Kim, thank you very much. Micron should start adding alcohol. See you soon, thanks. Folks coming up, speaking of something that has been a disasterous buy solar stocks. I told you solar stocks are annihilated because despite all of the government taxpayer money you would be shocked. Wait until you hear the number. Tracy shuchart tells you can make money off them. Do they have come back . Gary k. With us and will share his analysis. He is next. The first time you made a sale online with godaddy was also the first time you heard of a town named dinosaur, colorado. We just got an order from dinosaur, colorado. 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A more human way to healthcare. Charles all right, folks, 2023 has been an unusual year yet maybe a common sense year. These are the stocks going from the smallest market caps to the largest market caps. Guess which ones are the worst performers . Thats right, smaller caps. Guess which one has most significant gains, larger market caps. That is maybe logical. From time to time the small caps exhibit a little bit more moxie. Last week, smallcap growth, core, value were best performers. Outgrowth of midcap stocks. Anyway, small caps looking pretty intriguing. Every time we see this is a flash in the pan. They go on to move even lower. I want to bring in kaltbaum capital management, fox news contribute gary kaltbaum. It has been a remarkable year but maybe not as remarkable many say shouldnt the large cap capitalized companies out there have the best stock Market Performance . All i can tell you, charles, i really think the big institutions are reaching for liquidity and the liquidity is in the megacap names. That is why they outperformed quite a while. Nasdaq up, three to one advance the negative declines, russell 2000 getting whacked again today, not to mention the mid caps. I still think the train is going down the tracks. One time in the last 2 1 2 years i got teased by the small caps, and it lasted about a week before they rolled back over. Thats the end of that. You have to remember what is in them a lot of small banks. You know what happened there. You have a bunch of small oils also. I stay away. Im away from emerging markets and china. So many places im staying away from. It is a huge list right now, charles. It is interesting, that huge list is typically beginning of the year, december of any given years last two years, everybody says you have to be in, a lot of strategists at least. I want to pick up, russell 2000s, the nonearners are not making any money. Youve been a critic for a long time of these zombie companies. Oh, yeah. Charles a third of these companies, nonearners. X biotech. Take out the biotech a little better. 30 of these names are not making any money what happens, if the rates go up, not making any money should they be delisted . One rule of bear markets anything not making money will be crushed. You have soaring Interest Rates, cost of capital is going up. Guess what, it is tough forget capital if youre smaller f youre paying up that eats into any potential for profits. I think that is a part of why you see the large caps doing better right now. Look for me, most importantly i follow the tape. I look for price and patterns and small caps, they are just in bad, bad shape. Also i have one screen of all the meme stocks and all the stocks that went you know crazy to the upside during 21 on nothing . A lot of them and the spaces, a bunch of them trading 20 to 50 cents right now. It has to be a very good lesson for people going forward. Buy quality, buy greatness. Charles right. Find companies where there is a line across the street like a taylor swift concert if she was a stock i would invest in her. Stay away from the junk or you will end up in big, big trouble eventually. Charles only thing i would say to that though, maybe you can help me, last week utilities were the worstperforming sector. Today right now, utilities down 5 1 2 . I mean, this is supposed to be, these are the safest names out there. People pay their utility bills. They pay a dividend. One thing to have a meme stock getting hammered. How come these utilities are getting crushed . Between utilities and housing, theyre the two most Interest Rate sensitive areas of the market because they borrow a ton of money and as interest Interest Rates go up they come down, youre seeing that in droves. Im stunned what the utilities are doing in the last few days. Im worried that is tell graffing 5 plus in the 10year yield. If that is the case, i think the market will have a little more headwind before we get going in the socalled Fourth Quarter rally that everybody is calling for and i hope theyre right. Charles so do i. Oh, boy, there is certainly a message to this without a doubt. Gary one of the best of. I appreciate you sharing time with us. Thanks, charles. Charles coming up, folks, a takeaway on the story behind scabs. You know when folks cross the picket lines . I tell you origins of the word but maybe it should be applied to different industries. The solar etf has been dropping nonstop since 2020. Theyre putting trillions of dollars into that. If that wont move the needle what will . Tracy shuchart is here and what about the oil rally . If anybody knows she does. This is american infrastructure. Megawatts of power, rails and open road, and essential services of every kind. 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Heres why you should switch fo to duckduckgo on all your devie duckduckgo comes with a built n engine like google, but its pi and doesnt spy on your searchs and duckduckgo lets you browse like chrome, but it blocks cooi and creepy ads that follow youa from google and other companie. And theres no catch, its fre. We make money from ads, but they dont follow you aroud join the millions of people taking back their privacy by downloading duckduckgo on all your devices today. Charles all of suddennen the oil rally gushing has stopped gushing. It has beat a hasty retreat here. Goldmans prime desk, kelly talking about it, prime tech, theyre selling oil to get into the names. One thing from the ism manufacturing report, one thing stood out to me, recession feels imminent. Prices for some products may increase for upcoming Winter Weather this is the petroleum and coal industry. A lot of interesting signals here. When that happens we bring in hilltower chief advisor and ceo, chief market strategist, tracy shuchart. Tracy, friday i was talking to ed car denny, talking wti prices maybe going to 100, maybe the high price for oil and gasoline is the cure for high prices in oil and gasoline. Are you buying that . First, there is a lot of talk about recession right now. People are being very cautious and really, if youre an oil bull or, or equity markets or oil you really dont want to see pricing spike over 100 into a recession because thats going to cause a lot of demand destruction. So i think that, im certainly personally think it is healthy to see the pullback. 80 or 90 is good place for oil to be for right now particularly about were looking heading into a recession and i think that you know, Oil Companies in general, pricers particularly, dont want these spiking prices all over the place. Charles right. Theyre looking for stability so they can pour more capex into the market with charles talk about that for a minute. The capex stuff is being restrained by wall street. Governments have gone to war, particularly our government. Feels like the fix is in over a period of time for crude oil to be substantially higher than where it is right know . I think over the long term we are going to have to be looking at that. I mean i think, saudi arabia just came out today and said well need 600 billion every year, total of 14. 1 trillion from here to 2045 just to maintain the level of demand. So, there is definitely not that much in the pipeline by any stretch of the imagination. Charles no pun intended. Right. So, you know, higher for longer. Charles the other side of this has been okay, solar. There was a few times, over the last few years, oil goes up, solar goes up. Hasnt happened this time. Im getting crushed in enphase personally. Got a buy rating this morning. Stock is down more than 50 this year, solar stocks in general. Look at the solar edf. It is an unmitigated disaster. What im curious about that how do you explain to and investor to . Seems pretty sim, pour 10 trillion into this make people buy and own this stuff, how come the stocks never move . What you have to look at right now, there is costs under pressure sure, right . There are higher costs hurting manufacturers. Profit margins are down significantly. Look at a north American Company such as canadian solar, their Profit Margins in 2020 were over 37 . Theyre down to 12 1 2 in 2023. We also have to look at the fact higher Interest Rates are certainly not helping this as you know, costs a lot of money to fund these projects, and a lot of money to borrow to fund these projects. Charles right. We also have china tariffs. There are a lot of things working against this industry right now even though a lot of subsidies coming up in the ria act. Charles i have less than a minute to go. It has been a while since i gotten ideas proyou. There are a couple things youre doing. Cleveland cliffs is one . I was looking ad Cleveland Cliffs, as you know theyre in a bid for x, u. S. Steel, along with a couple other companies but i, i really like Cleveland Cliffs right now just because of the ark furnaces they use. A little bit more environmentally friendly. Were talking about electric vehicles and Automobile Companies trying to reduce their Carbon Footprint so to speak. So i think that that looks very good. I think as soon as this auto workers strike is over obviously well see an increase in steel demand as well. Charles all right. Been far too long, tracy. Thank you so much. Always appreciate it. Absolutely. Thank you, charles. Charles folks, coming up my takeaway on the word scabs. I will share the origin which is absolutely fascinating. Then well play a little game. Who should it apply to now . There are folks out there worse than people who cross the picket lines i think. Well be right back. upbeat music Constant Contacts advanced automation lets you send the right message at the right time, every time. Constant Contact. Helping the small stand tall. The uaw strike approaching three or four weeks in a number of days that even lost the workdays because of leverage, this year at the highest overall sense 2000. Although we have not seen, i cannot recall seeing anything in the news or read about crossing the picket lines, we know that that happens when strikers are out there. It was o thought the reprehensie the worst people mock onto possible the most defensible who cross the picket line. This weekend we would learn something just how much people hated those folks across the picket line known as scabs, first of all the word comes from a 1915 for web owed to its gap by jack london he was born in deep poverty he went on to write several masterpieces he had called the wild white fang, heres a little bit of irony to it that he became one of the wealthiest folks out there but he never lost track or touch of hardworking people, the little man or woman so to speak especially we as human beings use our natural survival instinct overcome things. In this oath he wrote after god finished with the rattlesnake, the toad in the vampire he had some awful substance left with which he made the scab. That is pretty rough stuff. I understand particularly in the depression era i can understand why someone would cross the picket line with that in mind we need to find different folks these days because thats a tough definition. Its so interesting that the spf trials beginning today because i have an idea maybe the people that are been ripping off the American Public via the outrageously priced ipos and all of the scam stirs author like the sam bateman freeze of the world raise all this money for the companies and extreme low valuation of the raise the money down here and then they spent a fortune on marketing because they want you to get to know the companies if they keep marketing and keep marketing it will seep into the brain why is that important, one of the most important vesting rules invest in what you know its in line from peter lynch principal of buying things that you know or you heard of. I heard appellate on i heard of this and that they become unmitigated disasters. Smile directed for bankruptcy, the company was going really fast they were doubled their revenue in 2018 to 423 million but they also doubled their losses, they lost 75 million it did not matter went public almost 9 billiondollar evaluation. This is on a 75 million loss 1. 3 billion, that was average a lot of echoes to advertising. This morning the stock is down 62 to 15 cents a share. By the way jack londons poem ends with this where others have hearts he carries a tumor of wrong principles, those folks with the severely overpriced new offerings on us have wrong principles. I dont care what anybody says, capitalist and a businessman and i believe in wall street in particular out of silicon valleys crushing african american. I do to lose. In looking at smile directed club i am stunned by this, 2019 this is an 18dollar stock