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tv   Making Money With Charles Payne  FOX Business  September 29, 2022 2:00pm-3:00pm EDT

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neil: remember when we dipped below 30,000 on the dow? very close to dipping below 29,000. you know the drill, stocks getting drilled. here's charles payne. charles: thank you s&p very much, my friend. good afternoon, everyone, i'm charles payne. this is "making money," and breaking right now, stocks are under a tremendous amount of pressure, this as the market recoils from a strong initial jobless claims, and investors are starting to fret about that bank of england move yesterday. what was the motivation for that emergency angst? -- action? ken poll carry is here to way -- kevin poll car erie is here to way in on that. and the 10-year yield is at 4%. could that be a blowoff top?
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plus, everyone talks about the vix, but what does it mean and how does it really help investors? we're going to clear it all up for you with a very special chart school. katie stockton is in the house. and how to avoid worst of pride and ego. i'm talking about a coming to jesus moment, folks. all that in my takeaway. all that and so much more on "making money." ♪ ♪ charles: so the market got slammed this morning after that better than expected initial jobless claims report and growing concern that the move from the bank of england yesterday with might have avoided a potential lehman moment maybe only temporarily. the initial jobless claims, folks, look at this, 199 3,000 -- 193,000. consensus was a 250,000. this is very impressive but, unfortunately, market participants need to see it going this way. it has unnerved the market bigtime, emboldened the fed
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bigtime, and you know that means more scorched everett. meanwhile, ceo confidence, this is plunging to its lowest level in 40 years, in 40 years. why is this so important? because this is usually a harbinger for corporate profits. where are they? they're here. but you notice they always trade in tandem with ceo confidence. how much more do earnings have to come down? and then, of course, there's other things you want to talk about, but first, i've got to give him props, chief market strategist phil balloon cat toe. right off the top, you did an amazing job, you came on this show week after week after week and said there was going to be a big spike. we got it. here's the question now, that 4% pop, could that be a blow-off top for bond yields for the 10-year yield? >> you know, i don't think so. we're going to hover here until the fed begins to speak about bringing things down, and the reality is they're not in that camp at all. the reason why we're selling off so hard is because the fed
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chairman has been so aggressive in his language, much more than i expected, and for that reason i think we're looking at maybe even a 4.25 if they continue speaking the way they do. however, here's one pivot. every single commodity market now including existing home prices is down significantly. there's a real good chance the only piece of inflation that's going to be left in the next c pix print will be rent, and even though it's turned a bit, your cpi for the month of september, i think, is going to surprise to the downside. and if so, we are at the top -- charles and, again, we've got the 10-year chart, it was already going higher and then this spike. people, you are looking at history. phil says maybe that's your top, not really the most worrisome thing in the world, but certainly we need to see it start coming town a whole lot more than that. so in the meantime, everyone appears to be throwing in the towel. we got individual sentiment this morning, above 60 for the second
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consecutive read, first time this has ever happened. when you see that, are you starting to feel maybe now we're getting that universal feeling the market is so unloved that it might be time to pull up a chair? >> every time we've seen this number above 60, 6 months and 1 months later the market was up 12-15%. so when question get to -- we get to these bearish moments, fear grips people. so for me, the opportunity is if you can withstand the volatility we're going to feel until the fed done, buying stocks much less expensively. but here's the kicker. you know, you can go into the bond market, heavy got a 5, 6, 7% yield, and you haven't done that in 10 years, so there's a chance on both markets to change the way you invest, and for me, that's what i'm doing right now. charles: what about the equity side of this? are you buying anything on the ec by city side at moment? >> i am. i'm still very aggressive in mid caps, value stocks, specifically
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banks. and i still like large cap value names, the costcos of the world, consumer staples, consumer discretionary. where do you spend -- and, by the way, the services industry is crushing it. this is a goods recession right now, this is not a service recession session, and for that reason, you've got a great opportunity. charles: and even in the midst of all of this, we saw costco make a nice couple moves here and there, some of the hotels trying to break out. these names are showing that when the coast is clear, they look like they do want to go much higher. phil, again, congratulations, and we appreciate everything. >> thank you. charles: nicholas wealth management president david nicholas. david, this market is super sensitive to any news that can embolden this fed, but lance roberts put out a pretty compelling chart this morning. to me, maybe it's because the fed might go too far. we know this is what the fed is finding, right, this is current
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cpi inflation. but in the future 5-year break even. at some point it feels like either the fed to's going to go too far, or will this number go higher. where are you right now? do you think we should be more concerned about an overly aggressive fed at this point? >> i think so. i think when you saw that speech last week, i think powell was a little more tough or than he needed to be. there's a lot of damage being done under the surface right now, charles, and the rate rising, obviously, it puts pain on the economy. one of the things he said, we cannot bring inflation down without it being painless. and i thought that phrase was key because he's basically telling us, look, this is going to be ugly, this is going to be painful. i think there's a credibility issue at stake. i think they're going to go harder. i think it's going to hit the economy harder, but it's also going to show up in earnings, so i don't think the market is fully pricing in the full impact to earnings -- charles: you know, it's so interesting, we've had a parade of fed officials speaking all day long including today. you know, their main job is to
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power this market down, i call it the house of dragon. they all come out, scorch everything around them. and so, listen, that's their job, but you wonder if they're going to take it too seriously. let me pick up on this earnings thing, because you're not the only one concerned that earnings estimates are too high, valuations are too high, but the question is how much more do they have to come down? >> yeah, and that's the thing. i think 2023, earnings and estimates, i think they assume a soft landing. and so if that is your investment theme, then i think you're a buyer here. but i think margin expectations are too lofty, charles. i think that has to come down. our number's about a 10% decline in earnings going to 2023. so depending on where that multiple lands if you get 215 on the s&p, i know that's lower than what a lot of other estimates are, is it 16 times, 17 times? so the market right now is right around you can call it fairly valued or even overvalued depending on where earnings end up. so i think we're seeing a 10%
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drop going forward. charles: almost everything i look at with perspective, whatever it is, current circumstances as they relate to 12 months from now, 1 months from now -- 12 months from now looks absolutely amazing. these bone-crushing sessions day after day, how do we ride them out? how are you having your clients ride them out? >> yeah, charles, this is probably going to sound crazy, but you can believe the market is going to go down some more and still be a buyer. those things are not mutually exclusive. we think markets are heading down, but we're still buying. maybe you can, charles, it is going to be very hard to find the bottom with of the bottom. but we feel the markets, we still hi we're going to see some selling pressure, but we bought google last week, so we're trying to tell our clients, look, you're right. but we can also buy even if we hi markets are heading lower. i would be buying here. not saying that the worst is behind us, but i think these are good value that you're getting into a lot of these names.
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charles: david, what i always say about picking the exact bottom, you're either lying or you're lucky. [laughter] anytime someone says i picked the exact bottom, i'm like, yeah, right. great stuff, my man. you have been spot on, and i love the advice you share with our audience. thank you so much. >> thank you, charles. charles: we keep talking about the fed because they're focused on inflation, by a -- but a lot of market pros are now bracing for the impact of recession. i want to bring in nicole webb. nicole, the bank of america came out with a consumer survey today. i found it so fascinating. first of all, 49% of people say we are already in a recession. among that 49%, 48, let's call it 49% of them are in the 125-250,000 income bracket. i mean, it's kind of nuts when you think about it, but it's so weird because i remember when i first started making money, when you get to that area, everyone thinks you're rich, your kids, your neighbors. so you're trying to keep up with the people making a lot more money, so i know why they're getting squeezed, but it's still
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amazing to me because if 49% of people making pretty good money feel like we're in a recession, that has implications, doesn't it, for the any and the -- economy and the stock market. >> it sure does. everything you just said, charles, resonates so deeply with the day-to-day work of the sector that i participate in of the financial services industry, working with affluent consumers. and so i'm very aware of how they feel at this moment and have a good hold on what they, how they're changing their own spending habits. and i think this is where we get into that self-fulfilling prophesy process of recessionary activity where you start to see that change in behavior. so i really like a lot of these points where, yes, you can still be a buy where are of this market today. you can see the opportunity in it while still saying that there are some of these chanters that bring data forward -- charts that say we might not have reached the exact bottom yet. there's still some outside
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circumstances that will continue to play out, but yet there's still a lot of opportunity if you are a holder of -- [inaudible] charles: so with respect to that, i think i read you said you don't see the fed pivot for at least another year. does that mean the market can't turn for at least another year? [laughter] >> that's exactly -- going back to some of these earlier conversations you've had already today which is we do think that there is this stall-out where the fed stops its activity but holds it there for a bit. and i think that plays a lot into where ceo sentiment has drifted to, to say that there is going to be these earnings revisions, margin compression. none of that looks extremely exciting for -- and, therefore, sentiments' coming down. but at the same time, when we get beyond that, when we do get to the inevitable fed pivot, when they do ease us back to this neutral environment, that's when we see this robust takeoff. i think the easiest thing for me to take it back personally is
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when we look at where the market is valued today, we were in a similar place before we knew the outcome of covid. and so there was a lot of new money printed world wild that has to -- worldwide that has to find a new home. so this is a moment in time, but i am still very bullish on the far side of this. so, yes, higher today but perhaps not the absolute bottom. charles: i love that analogy. i've got less than a minute to go. you know, e asked phil and dave about what heir doing, something people would be buying in a almoster-term investment to get through this period but also to try and make some big money along the way. >> yeah, absolutely. i feel like i have a lot of these right now. one that wasn't mentioned by any of your previous guests and and something that you and i, charles, spoke about earlier which, a while ago, would have been american tower corporation. i think they are great at playing offense and defense this in terms of there is going to be a conversion worldwide from 4g
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to 5g. we also have a lot of places outside of the u.s. where we haven't seen that full conversion, and on the defense we're getting a lot of revenue there from long-term leases and towers specifically. charles: right. >> so looking for kind of those pockets of the economy that are playing both sides, defensive strategy and offensive. charles: all right. nicole, thank you so, so much, and tell those folks making $250,000, don't fret, they're doing pretty good. [laughter] coming up, the economist mag. zien says britain's new leaders are already running that country into the ground. why investors should beware of media bias in their portfolios. also get out a pen and paper folks, you're going to learn, finally, what the hell the vix really is and why you should care. we've got a very special chart school. katie stockton is live many studio right of after this. ♪
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charles: all right, so if you've been in the stock market let's say more than a week, you probably heard about the vix, right? it's the so-called fear index.
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some call it the volatility index. what the heck is it, and why is it so influential? and more importantly, really how do you use it to make better informed decisions? joining me now, katie stockton in the house. it's so great to have you in studio. >> good to be here. charles: let's share what the textbook definition is, right? realtime index that represents the market's expectations for the for relative strength in near-term price changes of the s&p 500 index. sounds simple enough, but it doesn't feel like that when we look at it. people say the vix is not acting right or it's saying this. what does it mean to you? >> to me, as a technician, i see it as a gauge of market sentiment, it can tell us if the market's overly bearish or overly bullish. it's getting more bear everybody in the way that people are positioning as measured by the vix which we just consider a transactional way to gauge that market and sort of outlook -- charles: right. one of the big beefs
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particularly from people who have been in the business for a long time is that the vix hasn't gone high enough. a lot of people are saying we're not going to be out of the bear market until it goes north of 40, some saying 50 or of -- 60. you're saying if we look at the 2008 analog, it's gone perfectly. we're right around that 35 area, ab maybe we'll pull back, but this is what's scaring the hell out of me, is this really possible? >> you're not alone on that. i'm not big on analog normally, but this is pretty compelling. so we did highlight it to clients, and i feel we may not be in store for 80 or 90 on the vix -- charles: okay, i feel better. [laughter] >> however, we would expect something in the range of 50. charles: oh, wow. where would the s&p be -- we've got an s&p chart up here, of course, you know, we just saw that tested 200-day moving average that fell, also came down here and failed that key support at 3900, now we're down can again. what does that relate to?
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if the vix is at 50, where would the s&p be approximately? >> yeah. there's no way of exactly knowing, but we can trust that the summertime lows have been broken, next support is roughly 3500, you can see it there, and i think the most important takeaway from this chart is the slope of the 200-day moving average. you can just see the bear marke- charles: is that because these slopes move slowly? >> they do. charles: so this is starting to drift lower. could we talk 3300 or 32 the 00? >> 3200 is, for me, a targeted level maybe six months, so more relevant likely for 2023, and yet i wouldn't rule out 3500 from year end for which we'd likely see a big relief rally. it depends on your positioning whether you want to wait for that or not. charles: almost everyone is saying this is the most important stock, apple. got a rare downgrade today, i think it was bank of america.
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it's been under some pressure. of course, yesterday the story about cutting back production. this looks like a broken chart. now the question is, does it get down that low? can it really come down to this level? >> i mean, anything is possible. we've been watching support around 150 for apple, and it is important as a support level. but there is a short-term counter-trend signal that we're watching, andthat would be intact if it's below about 144 for apple. so we're holding out perhaps for an oversold bounce -- charles: let me ask you then, back to 150 as resistance? >> there's resistance around 160. i think that seems a bit hopeful in this environment, but we take that bounce just given the fact that support is below that 130. charles: so you're selling on rallies then. >> that's right. charles: to oil, energy, this was the no-brainer, china's coming back online, oil's oversold, all of the reasons last week we just got crushed. this is a more complicated chart. explain it for the audience. >> what you have here is the
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cloud model, and i love that you're showing it. it does show that it's still in a long-term uptrend. so energy as one sector autoof -- out of many, it is one that is in a long-term uptrend. and, of course, within that context we have -- that really accelerated last week, some lower highs. so intermediate-term momentum to the downside but within the context of the long-term uptren- charles: so would this be the opposite of apple? would you be buying the dips on this one? >> it's a tough environment in which to recommend buying dips when you can see the s&p 500 going down to 3500. charles: we learned a lot, as usual. what are you doing tomorrow is? [laughter] the great katie stockton, thank you so much is. appreciate it. all right, folks, the u.k., was it on the cusp of a lehman brothers moment? and if so, is the world still vulnerable? also how you make money from the strongest trends in the economy. the great nancy tengler's coming up. be right back. ♪ ♪ and i think it's gonna be a
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charles: all right, so in america investors, right, we've been on tinder hooks all year long. we've had so many things to fret about, right? the fed, inflation, now recession. but surprisingly, there wasn't a whole lot of attention paid yesterday to this emergency move by the bank of england which many say, actually, staved off massive defaults on pension funds, also a potential housing crisis. but overnight, i gotta tell you something, some very smart u.s. market watchers are now saying maybe we should take a second look. in fact, some are actually wondering out loud if the bank of england aeventerred a 2008 -- averted a 2008 moment. we had a 164-year-old blue chip
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wall street firm called lehman brothers that filed for bankruptcy, we had a company called bear stearnss that sold for $2 a share just weeks after raiding $133 a share. so some are wondering whether the british pound and the japanese yen are the current lehman and bear stearns. kevin, you worked at lehman at time? >> i did work for lehman brothers for 11 year. i left in 2004, so prior to lehman experiencing their own lehman moment in 2008. but, charles, what england is going through is very similar to what lehman brothers went through in the seasons that there's a crisis of confidence. when that crisis of confidence occurs, lehman had difficulties accessing the capital markets to fund their daily liquidity needs. that's what's happening in england right now with this crisis of confidence that they've created on their own. charles: well, a lot of these crises on on both sides of the atlantic are manmade. but real quick, the move should
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have been more, should they have done it? should they have done more? a lot of folks are saying when you roll dice like this, you can actually make it work. >> the move if certainly reeked of desperation, e discussed in the green room. the question is now what comes next. one of the things that was interesting was that they did put a mother 40 tore yum -- mother tore moratorium on household energy prices for two years. how is that going to help stimulate growth? the markets are anxiously awaiting to see what they do next. charles: kenny? >> the failure of bear stearns in march, and then it was four, five, six months before lehman. but that was brewing. it was that building crisis of confidence. so i'm not necessarily sure that the u.k. is out of the woods just yet. like you said, they pull an act like that, it feels like desperation. charles: right. >> we saw the markets kind of breathe a sigh of relief, but then today hook what's happening because people are considering what's it really mean. and she's only been in tower, truss are, for three weeks, and
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they're already talking about a vote of no confidence. charles: well, the media doesn't like her. this was a media that's against any conservatives who do well, and i think it's a dangerous gambit, by the way. i don't think they should be saying it's a failure, dead on arrival. let's see how it works out, because this is a country everybody better try to make everything work. >> but that can build on itself, she fails just because the sent9 gets so bad -- sentiment gets so bad. charles: let's talk about investing. haw what are you doing? >> we've trimmed our exposure. charles: why were you in international in the first place? every year particularly in january, everyone comes on the show and likes emerging markets because they've underperformed. >> long overdue. charles: right. they're long overdue. and then about june, july, september, we sol some of that crap. >> right. charles: is there a compelling reason to be anywhere else outside of the united states?
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>> prior to year, international lag ared the u.s. in terms of recovery from covid-19, and you want to have some assets just in terms of geographical. now it appears as though they're going to suffer a lot more than we are here in the u.s., and the recession that now we're in, i think, is only going to be exacerbated that much further. >> right, but can i ask you one question? you're not necessarily talking about emerging markets, you're talking about developed. charles: they've been sort of -- [inaudible conversations] >> yeah. so i like what kevin said. i was big on europe, right? i was really, i thought europe was really going to do well. but concern where we are now and more of what i read and hear, maybe lightening up on europe makes sense -- charles: you still like the dividend payers. >> i do in this environment, right? i like the big mega cap stocks. some of them are going to suffer because they're multi-nationals, so the strong dollar's going to impact them. we understand that. but that's a temporary, i think, phenomenon.
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these companies have to to come out and forewarn that -- charles: -- the company of the moment, you always like -- >> down 22%. why wouldn't you buy it? i hear it. so the more they downgrade it, the more you want to buy it, right? who downgraded it today, by the way? charles: bank of america. rosenblatt, though, said it was a good stock. [laughter] kevin, you like dividend payers as well. >> i do specifically in the health care sector. history has said health care is one of the best performing sectors up to and through recessions. so big, large pharmaceutical companies such as merck, pfizer -- charles: anything on the insurance side? the humanas of the world look intriguing, cardinal -- >> cvs, we like their acquisition of signify, we hi they're going to revolutionize the way in which we dispense medicine and deliver health care predicts in society. but those are the types of names we like, and don't count out biotech. charles: i just don't know how to playboy tech, man. it's so hit or miss.
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>> it's down 50%. charles: yeah. although that biogen with nudes, by the way, was great news for society. if he could do more with alzheimer's -- >> couldn't agree more. charles: always a pleasure. of course, we never get enough time to discuss it all. i also love to write about it. i do it every single day, so check out my free commentary. go to w, i i know you'll like it. october, it's got a reputation as a bear market killer. luckily, we've got one of the best market historians in the world, ryan dietrich here at 2:45. but first, the jobs market is still a beast, but should it dictate fed policy? nancy tengler on deck. ♪ and i'll be taking care of business every day. ♪ taking care of business every way. ♪ i'll be taking care of business -- ♪ taking care of business and working overtime ♪
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charles: well, folks, it's getting real expensive to run a business, so yesterday the richmond fed if survey shaw a dramatic jump in businesses that are experienced a larger than normal costs for a majority of their operations. in fact, it's now well over 50%. you can see about a year ago it was less than half of that, and really here's the most incredible thing, those who are seeing no cost, like 2-3 president. so a lot of this has to do with wages. that's one of the reasons this market's under so much pressure, kind of sinkerring like a stone after -- sinking like a stone. we know the fed wants to crush the job market and find a way to slow down wages. i want to bring in laffer-tensionler ceo nancy tengler. many say it's a lagging indicator, and the fed if really should be looking ahead, not in
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the rearview mirror. your thoughts on this being such an important component of their decision making. >> yeah, charles, good to see you. i think we saw a fed last year that was laser beam focused on job z while the federal government was paying people supplemental benefits to stay home, and they were ignoring inflation. now we're seeing exactly the opposite, and they've told us they're focused primarily on inflation at the expense of jobs. so i think reason the fed has a dual mandate is because it needs to have a dual mandate. both of those things are very important. i just got back from the midwest, met with one of our manufacturing clients, very large. he told me that he is supplement aring the union labor contracts so that he can attract better employees into management. that's, that's an interesting fact. i'm absolutely stunned by that. and still having a difficult time finding labor, but many of those who have retired in the last year from his company are coming back to working three days a week.
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and that's because of the tightening financial conditions. so i think, i mean, everyone knows this, i think they've been wrong happieded and their judgment has been wrong at almost every point since 20 # 18 when powell became chairman. charles: lately, these sessions have all felt more climactic like, wow, was that it? [laughter] you know, is this a chance maybe we're in a bottoming process? and earlier i had phil, that spike in the 10-year to 4%, you know, these big down swoons that we see almost every day, could be part of a bottoming process? >> of course, you know, i don't know. i hope so. i think we're starting to hear -- i saw this segment with katie stockton. it was excellent, and she is telling people to sell the rallies. i'm hearing other technicians, and she's one of the best or the best, and i'm hearing other technicians come in and say, look, we're starting to see price exhaustion, the market
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indicators are often called into play. but here's something i think that will give your viewers comfort. so i got to the business in april of 1984, so it wasn't the beginning of the world but almost. since then the dow is up 2,395%. but that's the price change. but if you add in dividends and the compounding, it's 6838%. and the numbers are almost9 identical for the s&p. so i've been managing dividend growth portfolios since then, and i think it's just important for your investors to be disciplined, to step in, buy companies that where the managements are confident about the future and are raising the dividends. charles: right. and i think 3-5 years from now we'll look back and say why didn't we buy more? charles: real quick, we got the final revision on second quarter gdp. the low line that stands out, technology investments. take a look at this, folks. this goes back to 2018. that one quarter with the covid
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thing. this is what they're spending money on. they're making bigtime investments, and i know this has been one of your investment themes, right? there's a way to piggyback all of this money, isn't there? >> absolutely. that same manufacturer, by the way, said we are investing dramatically in technology to improve productivity. it's expensive, but it's what you do when there's a tight labor market. look at a stock like microsoft that has a price to earnings, a peg ratio of 1.7. that's almost near a historic low. and you look at the earnings growth in many of these companies, and you've got cios coming out and saying the last thing we're cutting in our budget is cybersecurity. we're increasing our spend to the tune of 78% of us us on enterprise and cloud spend. so i think you just have to continue to look the other way -- [laughter] on days like today -- charles: sure, sure. >> and put cash to work in this space because it is the secular narrative that has a huge tailwind to it, and it's going to solve a lot of our problems
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in the coming years. charles: absolutely. we know it. we know it. this is something we know. a few bumps in the road, maybe more volatile than we would like, but i agree with you a thousand percent, nancy. thank you so much. >> thank you, charles. charles: all right, folks. my takeaway later in the show on not panicking especially when it comes to your 401(k). and of course, it's been a brutal year, but can we avoid a red october? ryan dietrich breaks it down for us next. ♪ ♪ ♪ your shipping manager left to “find themself.” leaving you lost. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit this isn't just freight.
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charles: all right. well, the season just changed and so will the calendar here as we head into october. gotta tell you, there's a whole lot of hope that this sort of dovetails into a turning of the page on this painful year for investors. no one better to help us that carson group cheer market separatist ryan dietrich. i'm calling this the trying to avoid red october, okay in. [laughter] history has something of a reputation of october being a bear market killer. is that accurate? >> yeah, charles, it is.
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first off, you know, as someone who grew up going to sanibel island down in florida, thoughts out to everyone who's impact9 by everything that's going on. but some potential good news here. the last 17 bear markets, 6 of them bottomed in the month of october. is it random, is it not? we don't think so, right? a couple months now, i wish i was wrong, saying august and september usually are weak and september's really weak when you're weak heading into it. that's playing out. but again, when you have a bad september, october was actually best. it's a midterm year. october actually from a purely seasonal point of view is the best month of year in a midterm year, and after what's going on lately, i think we could really use that next month. charles: no doubt can about it. and the track record for that, i think, is even more concrete, isn't it? >> no, it is. you know, when you talk about the fact, like, it's the fourth quarter of a midterm year, that's the strongest quarter out of the 4-year presidential cycle. here's one for the listeners,
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when you make a low during a midterm year -- wherever that low is -- one year later, charles, every single year stocks were higher, up over 30% on average. i know that sounds crazy, but history says midterm years can be rough, can be kind of scary. later in the year, a year off that, he can be pretty good. and we think history could repeat itself. charles: it sounds like anyone who might be nibbling, buying these big dips going into next month might be happy a month from now but could really be overjoyed a year from now. >> you're right, charles, and that's kind of the key concept. the guests before, you guys talked about some very real concerns that are there. but i'll tell you, when you look at polls and flows and lots of different things, everyone agrees things are terrible, things are bad. but markets have a funny way of kind of balancing that out when we get any better news at all. that can form a pretty good low. sometimes --
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[audio difficulty] really soon, we think, and a year from now investors in the 401(k)s, they're going to be happy they bought at some discounts. charles: i've got a minute to go, but i want to ask you about that bond rout. this has been one for the records, and i know the carson group just did some work on this. or what are you saying to investors about the bond drubbing? >> the barclays ag was down 2.9 for the first year ever in '9 -- '94, so this is a historic rout. if rates go higher, bonds won't do can quite as poorly, we are still in that camp. we really like stocks over bonds still. believe me, there's always a place for pixed income in the portfolio portfolio, we just think stocks are going to do better than bonds, and that's how we're positioning our portfolios. charles: i remember last year doing a lot of pieces on the 60-40 portfolio maybe being threatened. i don't know, you never say never, but that 40-year secular bull market many bonds, i think,
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is going to be a secular bear market as well, so people better make adjustments. ryan, we've got to leave it there. thank you so much, and you're right, our prayers go out to all the folks in the path of hurricane ian. one variable in the market is how people take developments, right? many more and more, and a lot of times it depends on what side of the political aisle you're on, how you feel about things like the recession and the economy. the media also does this and, i think, has done a lot lately to sort of mitigate the struggles. for instance, take a look at this washington post story, seven ways a recession could be good for you financial hi? [laughter] joining me now, mahoney asset management president ken mahoney. ken, we know that media's biased, but when it comes to matters of finance, shouldn't they play it straight? >> they should but they won't. i mean, come on, we have a whole new definition of a recession. i mean, since high school i knew it was consecutive quarters of negative gdp growth, but we found out that's not the case.
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we're going to kind of examine that and so forth. and on top of that, the energy crisis. gas prices going down, yeah, we're emptying out the strategic reserves to make that happen. they're not going to tell us what the truth is. and, by the way, they put biden out in front of the teleprompter to read and basically say with a straight face every we have zero inflation. what he meant to say was zero inflation month over month, but cpi's calculated year-over-year. that's a high school concept. charles: by the way, it happens on both sides of the lick, the economist reads how not to run a country, the picture of the chancellor of the exchequer, rowing a sinking ship with the new prime minister who, by the way, is standing comfortablyly. and i -- comfortably -- confidently. i believe this makes these crises tougher to deal with. >> yeah, an image is worth a thousand words. she's the new prime minister. she should look strong. a lot going on with the sterling pound versus the dollar. we saw that quantitate thive on the long end. but given the opportunity, let
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let e her run a little bit with, again, her ideas which, i think, are better for the economy than before. charles: yeah. let's talk about what you're doing in this market right now. how are you navigating it with your clients? >> so deep breath on that one. what we're trying to do, a lot of people hi it's too late to be shorting stocks, maybe too early to buy stocks. i just mentioned to you and you viewers buying something long, buying something short that makes you market ago knost ific. i came up with microsoft long and facebook short. meta has all kinds of problems. microsoft's down 6%, meta's down 18%. you netted 12% of that trade. i also want to say to your viewers, the closed end funds, stir of i moo chul funds, they don't issue new shares. you can find a lot of bonds trading 10-15% below that asset value yielding more than 10%, i mean, seriously, trading below
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10% -- more than 10% yield. income investor, you should be looking at closed-end funds over open-end funds. charles: that's a great point. no one's bright that up. ken, a thanks thanks a lot. coming up, my takeaway on your worst enemies as an investor, pride and ego. ♪ ♪ another busy day? of course - you're a cio in 2022.
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charles: throw charles: one day all of this will turn around; right, liz claman? liz: not bet against great american stocks and american companies behind them. charles: i agree. liz: today is tough. it's not just risk assets getting absolutely pounded at this hour, it's just about everything except maybe betz on volatility but let's start with the nasdaq here. we know that there is red across the screen. this is the biggest percentage drop at the moment. we do have it down 3.7%. the nasdaq is falling 416 points. so it has all been more than wiped out what we saw yesterday, which was a gain of 222. looking at volatility entropical depression, the vix -- index, the vix, there's fear in the market up 9% at the moment above 30, that's sort of been that level that people watch.


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