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tv   Making Money With Charles Payne  FOX Business  November 7, 2022 2:00pm-3:00pm EST

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for the gifts that keep on giving. because while they have no idea what's going on here... -hi. -...a little something of their own will get them in the spirit. great prices. happy pets. chewy. if you wake up thinking about the market and want to make the right moves fast... get decision tech. for insights on when to buy and sell. and proactive alerts on market events. that's decision tech. only from fidelity. neil: all right, to the hardest working man in all of cable news, charles payne, right now. hey, charles. charles: neil, great to sue, my friend and good afternoon, my friend, i'm charles payne and this is "making money." markets on edge. ahead of the midterms historically send stocks into overdrive but trepidation about the fed, going from inflation to recession keeping a whole lot of investors on the sidelines. what if the market already
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dismissed such concerns, folks after surviving jay powell's gut punch last week. gary kaltbaum, shaw pa lawn any, jim awad to discuss the way forward. nothing seems to be working. how do you invest when the rules always seem to be changing. alli mccartney is here. a change could help biden avoid a dubious distinction that his predecessors couldn't avoid. steve moore will be here. my take on the mainstream media and gut-wrenching headlines. it is more than clickbait, folks, and you can't let it get you down. all that and much more on "making money." ♪ charles: so we come into the week, we're grappling grapplingn asortment of issues, all kinds of challenges and at the very top of the list the fed's ruthless approach to containing inflation, runaway inflation and the way it has played a major
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role and really helped to create inflation. now you probably read where bear markets continue after fed pivots. i want to tell you that is not always necessarily been the case. in the '70s, 70, '75 fed pivoted as a bear market ended. only recently during the great financial crisis that the fed pivoted but you had a bear market that lasted a little bit longer. in 2020 you had the bear market last a little bit longer. will this be '70 and '75 where the fed pivoted and the bear market continued? on the other hand there are gyrations we gotten accustomed to. 1% sessions this is unbelievable this is where we are now. i don't think we'll catch the high. this is the year where everything imploded. we'll be close to 2007, 2008, really rough year for the markets. buckle up. that this is the way things will be for now. we're all grappling with more, right?
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the change in this market, i have to be honest it is hard to deal with the belief, happening before our eyes, changing of the guard potentially seeing fresh leadership. energy is killing it industrials, financials, health care, consumer staples, but these are names that lifted us, info tech, consumer discretionary. these are names that almost 20 years took us much, much higher so is this real? i want to bring in kaltbaum capital management gary kaltbaum and money map chief investment strategist shah gilani. last wednesday the market fell apart when jay powell dropped the hammer. the biggest decline from 2:30 to the close in fed history. a lot of people think he will go out there and slam the economy until inflation is defeated but you got mike wilson of morgan stanley who has the been the hot hand, has been a bear. could have called on the bear
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call and say market reversal and we passed a teslas week. do you buy that? >> with respect to mike wilson who made fabulous calls. i disagree. he is calling for a rally in the event republicans do very well in the midterms. i'm not necessarily in that camp. we could get a pop for sure but i think any rally we get will not have legs. it is not about fiscal policy. it is about monetary policy and the if he will not pivot anytime soon. this market has more downside to endure. charles: meantime, gary, the market is exhibiting some pretty good resolve. you had a good stretch into last week. friday wasn't a bad session. today is okay. is this at least a trading opportunity? >> specific places, charles, if you didn't look at the dow and looked at the nasdaq and the nasdaq 100 you would not know we have not had any rally since october 13th. the dow has kind of v-shaped up.
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the nasdaq and nasdaq 100 are at their lows with a bunch of names in high beta, tech, and software that have led throughout decades breaking into new yearly lows. two-way tape. you better be specific. we're in right now i call the revenge of the nerds market. i think it could go higher from here. there is nothing wrong with it. look at the dow, amgen at new highs, caterpillar, honeywell, mcdonald's have done u-shapes. that is fine and dandy. the problem is i don't think they can last too long if the nasdaq doesn't start to shape up soon i think trouble ahead. watching ahead very closely. charles: i think revenge of captain of the football teams. the nerds had their way for the last 20 years. now the captain of the football team who went to work for caterpillar who is winning. stay with that, gary this is always something you talked about, zombie companies. i don't think people realize how many zombie companies there are.
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1% of the s&p are zombie companies. they make no money. they have been able to borrow money. rates with negative a lot of free cash. 2020, 2021, all that money look how many zombie companies we had. it started to pull back. the reason i ask you about this, gary, some stocks are traded $200 a share, now they are eight bucks, 10 bucks. people are tented to buy those. do you warn them no matter what price they stay away? >> i think a lot of them are down for the count. that is not just based on opinion, it is based on history. as you go through every bear market you have to remember what happened. if you give away free money everybody will take it. that is what jay powell did. for two years we were saying with some companies have bonds yielding 3%, they should be yielding 10%. that is how you get away with it. watch their stock prices. that will tell you everything you know. and some of the bond prices were
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at 100 are now at 30. that tells you a lot also. just be very, very careful. invest in greatness. a lot of these companies earns not much great about them. you need great earnings and revenue growth, otherwise you got to look elsewhere or else. charles: on that note, shah, nasdaq obviously struggling. are you buying then we could be in a changing of the guard? i'm not talking on a temporary basis but a new secular bull market the next one being led by the also-rans of yesteryear? >> no, not by a long shot, charles. again, i'm going to reiterate what i said, i've been saying we got lower to go here. there is more pain. as far as the zombie stocks we're playing money on put spreads. there are a lot of them. 40% of companies in the s&p 1500 don't turn profit a a lot are loaded with debt, negative free cash flow with negative profit margins we're targeting to make money on the downside. i don't see the weight of that
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bringing the market down, the lack of tech leadership i don't think will turn around anytime soon. frightening there is lack of leadership so i don't see any pivot in terms of the market making the first leg higher what could be a new bull market. i think we're several quarters away from that. charles: wow. okay. are you buying anything yourself, gary? >> i started buying on my confirmation day, october 21st. we brought broad-based. you had to wait for earnings. there are stocks blowing up to the upside and a bunch blowing up to the downside. we'll wait but i can tell you this, oils, defense, auto parts retail, managed care and a select few big drugs and biotechs. that is what is leading the market right now. that is what is doing the trick right now. not much else after that. yeah, financials are playing a little bit of catchup, other things. they're not leadership. i think they're countertrend rally. so a few areas, not much after that. charles: i got less than a
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minute to go then, shah, you obviously stated your case here. i want to get once again from you, the big market-driving news this week won't be the election outcome in your mind it could be something like less -- i wouldn't say benign cpi but a cpi number perhaps that will come in less than expected? >> yeah, i think the cpi is going to be the focus this week, charles, and i think if it comes in a very low handle, unexpectedly low handle the markets could rally on that but i don't know it is going to. we're looking north of eight handle on that and that doesn't bode well. that will maybe everybody think that the fed is no way backing down from here. that means more pain for the market. charles: gary, shah, two of the best. we're lucky to start the week with you appreciate it. investors should be thrilled historically at least from the midterm elections. they are always pretty good but occur during a bar market, folks take a look at that the bear market is the dow, s&p off 20%
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or more. had one in 38, 46. you see all the bear market years, down 20% to 50%. a year later, every single time the market is higher. by the way fourth quarter rallies are sometime even bigger than that. i want to bring in clear state advisors senior managing director james awad. jim, a lot of things are said during election time. why do you think we get sort of reactions to the stoke market after midterm elections? >> because you're eliminating major uncertainty. you have the political uncertainty out of the way so then you can make assessment what effect congress has on the economy, taxes, spending et cetera. so it is not, it is not important in the long term sense. in a short term tense it does allow to you refocus on the economy and not worry about politics. so it is likely to happen again but i wouldn't invest a lot of money based on it.
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charles: to that point the one circumstance this time, did not have 40 years since the inflation monster. the inflation here, maybe peaking a little bit, we'll see. not surprisingly these are corporate earnings. friday i made the point, sloshing around, too much money chasing too few goods, 101 inflation definition, corporations make a lot of money, so does the government. we know at some point inflation will come down. that means earnings too. how are you adjusting your portfolio for this inevitability? >> the major risk in the market right now we sort of have a handle roughly what interest rates are going to do. they could end up going higher than the 5% we're expecting or could be tremendous bad news and the fed could stop before they plan to but we sort of have a glide path on interest rates so the question becomes earnings and what is the effect, lag effect, incremental effect and interest rate increases on
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earnings? you have to know interest rates come down. going forward it will be difficult as increases affect the economy. you assume earnings will likely be down next year, not up. and build your portfolio around companies in that environment that can show increased earnings when earnings in general are not growing. charles: won't be any dart-throwing that is for sure. i want to ask but the fed, right, because i don't believe they will go as far as they say they will but i do believe the rhetoric served them well and jawboning. i'm looking at what susan collins had to say on friday. i sense based on the fomc statement that jay powell did not want to read. what i heard from collins maybe there is tension inside of the fomc. there is sense, maybe, maybe, there is some pushback. the fed won't be as harsh or hawkish as they claim what would that mean for the market? >> that would be very bullish
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for the market because i think the market very much wants to let interest rate increases we've had work their way through the economy. we can see whether, what the effect is on profits and whether there are any cracks in the financial plumbing. if the fed keeps going without taking a pause to see what the effect what they have done already is on the economy, they run the risk of the overshoot that we've all spoken about. charles: right. >> so it will be difficult though. powell was pretty specific. i don't think he wants to be embarrassed. i think the risk is, that they, that they go more on the hawkish side and they overshoot but you are going to see this dissension start to build and continue to build over the next several months. charles: before i let you go, i have 30 seconds to go, jim. is there something specific you are buying you will buy and hold next year? >> i think what you will buy are quality growth companies that do not have business model issues. a lot of them like meta, et cetera, there are issues. take something like an apple,
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which has a terrific long-term record. sure they will have production problems or demand problems but companies like that have definitive business models and fortress balance sheets on these kind of weakness i think you look back in a year will be happy. charles: i have to tell you anytime i have a guest who mentions quality stocks and won't mention apple in the same breath it blows me away. i don't think there ever has been a company that qualifies for that term. jim, thank you so much, we appreciate you. >> pleasure. charles: president biden might be on the verge of making history, potentially the first president to have a recession in the third year of a presidential cycle. the good news, maybe the republicans will bail him out! steve moore is here to talk about that individual inflation scaring investors. wall street wants to see more. wait until you see how much fear they want. chart school is next.
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♪. charles: so we know volatility has been a hallmark of 2022 but
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there hasn't been enough fear. well, that is according to wall street which still thirsts for retail investors to throw in the towel. i saw a headline over the weekend, from my next guest, it scared the hell out of me, the cpi report could deliver a massive, a massive shock to the markets! now there is a lot of people who are concerned about this including me and if that happens if that cpi report does create this massive shock it means the fear index could go through the roof. i want to bring in capital ceo and founder michael cramer. you have been posting this chart. listen, it has been amazing so far. the 2006, 2009, you know, versus what we're doing right now. >> correct. charles: so essentially pretty soon we're talking about going parabolic. it would maybe that cpi number on thursday could actually be the trigger for that? >> so that is what, i've been kind of watching and thinking
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about a lot because the way that chart kind of lines up, it does pull us into that time around cpi into this week, beginning of next week. charles: cpi though, we've been like get to 35, we come back down, 36, we come back down. a lot of folks have been frustrated. many folks say at least 40, 45, wow! we're talking 65, 75, 85, i even heard 90. what correlation would that have with the stock market? that would be devastating? >> it would be. probably it would result in a sharp decline. last time we were here talking about 3500 a key level. clearly a breaks at that level would lead to a sharp decline around 3200. charles: another issue for the market particularly the multinationals has been the strong dollar. the dollar came back a little bit. jay powell talked it up but we're pulling back again. >> right. charles: looking at the trend line, looks like we could get relief if it breaks through
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there. >> i stilt think it goes higher, it is chasing the two-year-year-old higher. the weakness we've gotten last couple days is due to hope and fear, the hope that china would come off the zero covid policy and that has really kind of resulted in some dollar weakness. charles: they keep reiterating they're not so the big theme, the really big theme for long-term investors is, is it over? are the megacaps done? if so do i load up on industrials, materials? they're not sexy. growth since 2007 is crushed. this is growth versus, this is growth versus value but all of a sudden value because growth is going down, value is the place to be so far. does this trend continue? >> so basically, if you look at this growth to value relationship, about 40% of that growth index or etf is basically apple, microsoft, amazon, alphabet, nvidia, tesla, all down a lot this year, right? charles: right. >> a lot has to do with the big
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megacap names declining in price and returning to some sort of valuation that makes sense versus value as oppose towed value getting higher. >> does it continue? do you think it persists -- >> looks like you're probably heading back to like the 2018, 2019 highs in that relationship. charles: wow. you're long only. you're not here saying i'm short a bunch of stocks. you're just giving us the way your work is saying to you? >> right. charles: in this environment you kind of sit on your hands? >> this environment i'm not chasing the market higher. i'm letting it come to me that worked fairly well. with cash on the side. wait for the market to come down -- charles: you have to go have youth and patience my man. you have them both. great work, michael. >> thank you. charles: coming up what the keys are to investing when you get the extreme volatility because it is here. we will give you ideas, with alli mccartney here and rob luna is on deck. president biden criticizing
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coal, home heating skyrocketing. take a listen, take a watch. president biden: no one is building new coal plants because we can't rely on them. we'll be shutting down these plants all across america. >> mankind has depended on coal for about 2000 years. we'll see what steve moore has to say. i'm sure he is ready to sound off right after this. ♪. ♪
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♪. charles: well inflation is the conversation everyone's having everywhere especially in georgia with the senate race being neck-and-neck, inflation costs georgia residents really skyrocketing. it is now become the main topic of the midterms. we have connell mcshane live
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in marietta, georgia, with more on this story. connell. reporter: charles, yeah we've seen it time and time again in the polling, talking to people inflation is issue number one with georgia voters. certainly herschel walker and senate race against rafael warnock is hoping as a republican it will be a winning issue for him. go to a place like the marietta square market which is down the street and we see it. we checked in with local restaurant owners. they were talking to us about the impact of these higher prices. >> everything went up suddenly. utilities, food costs, gasoline. >> it is kind of the perfect storm, right? obviously the cost of goods have gone through the roof but labor is also a huge challenge and, you know, labor costs have gone up but also just getting people. >> we have to-go containers have a cost associated with them have increased. the gloves, we used to pay $49 a case. we're paying 120 a case right
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now. reporter: everything just costs more. we were speaking to some voters who support herschel walker and they say they're doing so for that very reason, inflation. his challenge though will be getting undecided voters like christina to look past her questions about his character. >> i do align with the republican values and because herschel walker, i don't think he is a strong political candidate for that and i do see that we have a reverend who is democrat and because of our christian values, it is hard, you know, to align with a democrat value when you know you're republican but the values are stronger over there. so it is very hard. reporter: walker spending the last full day on the campaign trail with a rally this evening alongside senator lindsey graham and others. senator warnock just wrapped up an event in macon, georgia. he has another today in columbus. then it will be on to the in-person election day vote tomorrow around the state. but remember, charles, over
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2 1/2 million people in georgia have already voted. charles: wow, connell, it will be a nail-biter for sure. thank you very much, my friend. as inflation ravages the economy there are growing signs the economy itself is not as strong as the media or economists make it out to be. for instance the jobs report on friday. here is what you need to understand, it consists of two surveys the establishment survey, 2.45 million jobs over the last seven months. you know what the household survey has chon, they go to households? 150,000. there is so much hoopla over the report beating consensus but nobody mentioned the spike in continuing claims. this sort of underscores it is increasingly difficult for people just been laid off to go back to find a new job quickly. meanwhile the notion of excess cash coming to the rescue ignores so many things, right? households and businesses are starting to go through this cash. this chart you're looking at,
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252 billion of the 383 billion raised by corporations during covid has been spent. now tomorrow will be mostly about inflation. my next guest points out one in five every americans are skipping meals due to inflation, an issue by the way has been ignored or belittled by the white house and democratic party. i want to bring in from freedom works, senior economic contribute it steve moore. democrats are saying inflation is a word republicans have actually made up and no way to stop it if it really exists. what would your reply be? >> i tell you the inflation rate was 1.5% when donald trump left office and now we're at 8 1/2%. that is a gigantic increase and look, inflation is a killer issue for politicians because as you just said, you just reported from georgia, people feel it every day and they get angry and, look, voters are angry right now. they're angry because this is what i call a cost of living recession. so you know the jobs are out
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there. if you have got a skill, try to get an electrician or a plumber or people who will, you know, work on construction projects, there is a shortage of those workers but the problem is, people are working, the truck drivers, so on, their wages are just not keeping pace, charles, with what their, what they have to pay for their basic bills. charles: right. >> what is going on, i think this is kind of a sleeper issue, i don't know if you looked much at it, charles, look what is happening to credit card debt. so americans are going mower and more into debt to pay their basic bills because their paycheck isn't keeping up. charles: you know, you know, steve, you know, i looked at it, my man. in fact, i think one of the things that blows me away is from june of last year to june of this year, the bottom 90% of household incomes saw a record amount of debt, credit card debt. this is mind-boggling, this is mind-boggling when you consider all the free money that went
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out! to your point keeping up with basic living starting first and foremost with fossil fuels. this weekend president biden slamming fossil fuels, saying no new drilling coal is unreliable. it boggles the mind, they put, they put climate above the average, well being of the average american, haven't they? >> they sure have. you know, this is i think the problem that the democrats have right now is that the issues that the elite, rich, liberals care about in washington are completely different than the issues that working class democrats and republicans care about. so what do they care abought? they care about lgbtq issues. they care about racism and so on. what do americans are caring about? the inflation rate, gas prices, the border, crime on the streets and those things democrats have completely ignored and incidentally, why would joe biden three or four days before a major election where
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pennsylvania is the kind of swinger state, why would joe biden go out there to say i want to kill coal? charles: yes. >> my god, charles, pennsylvania is coal state. charles: i think in his mind he wrote off the pennsylvania election. i think they're out trying to clean that up. i want to stick with president biden, he might have the dubious distinction soon. from what i understand there has never been a recession in the third year of a presidential cycle since 1929, i'm thinking a republican victory can save president biden from the record books, steve? >> i wonder about that. if we slow down the massive spending because i think this bad economy is all the result of the $4 trillion of spending that we did that was all borrowed. charles: right. >> look, republicans could come in -- that is sort of what happened, by the way under bill clinton. remember the first two years of bill clinton's presidency were a total disaster. newt gingrich and republicans came in. by that time bill clinton moved to the middle. he triangulated.
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then a booming economy. i love to sigh, i love a booming economy. joe biden move to the knead dell? charles: he won't. ofhe won't move to the middle. bill clinton was an amazing politician. we're out of time. i want to bring you back sooner than usual, postelection where we go from here. thanks so much, steve. >> thanks, charles. charles: coming up my takeaway of the impact of headlines on our emotions. it is devastating. with the market volatility running rampant how should you invest for the longer term? we've got really one of the absolute best on the street. alli mccartney will share her thoughts and strategies right after the break. ♪.
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♪. ♪ don't stop believing ♪ charles: 2022 has been a tough year for investors and i find myself thinking about the journey classic, don't stop believing. i'm a champion ever the benefits of investing moreover if they do stick and they will be rolling the dice just one more time and that is not really the way you want to look at this longer term. joining me ubs private wealth management director alli mccartney. let's take a look. this is 2022, right? nothing has worked. all stocks red. high yield corps, red, treasury, gold. only thing that kind of worked is cash. no one invests to be in cash, right? what do you say to someone when you see this, i'm thinking about a but? >> okay. i think that is a great place
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and everybody should be quite frankly be relevel setting at this point in time. first of all there are a couple of things that aren't on here. alternative invests, private investments, some thematic invests. around sew what the, the important thing to understand here is that we are talking about less than 2% of historical 12 month periods. less than 2% -- charles: this is rarity? >> this is such a rarity. for some people that makes you feel worse. for some people, for me, makes me think okay we'll go back to normalcy, we'll go back to the 98% where many things are working at the same time and we're not in a 20% where a market where you're stuck in bond portfolios down 20%. charles: right, right. this is what we're looking at for you, sort of where you are right now. by the way i love the fact you have a mid and full year target. that is realistic because things change. we start to get up to speed in
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the second half of the year. what is intriguing to me you see higher valuations. so what does this mean? the street would be more, why will we get a higher valuation in the second half of the year? >> that is a great question. first of all 215, the number that ubs has for forward 12 months earnings, way below the street. so we think that next year verse this year that revenues and profits are going to be down about 4%. charles: americans the 3700 part of the target? >> the 3700. the street is still at growth. we're at down. we think the street has to catch up with us. but the reason you would have a higher multiple at the end of the year than mid-year is that i think all of us believe and feel, right, sort of the behavioral psychiatry and the emotions of investing right now, we're at peak uncertainty. we feel bad about everything. we have negative earnings. we have concern out of
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washington. we have issues around oil going into winter. we all feel terribly, terribly fraught. charles: right. >> think a year and two months from now, we're going to be done hopefully, climbing that wall of worry and multiples and forward thinking and looking through negativity is going to help us. we do believe that's true. charles: and by the way i buy into that 100%. let's talk about your approach then. this is the circumstances, you set it up the sir stances where you think people should be focused, value, defensive, quality and themes. let me start with themes. you mentioned that a minute ago. >> yeah. charles: thematic investing for the most part way we look at it with broader audiences, yeah i bought the thematic stuff in 2021 i got hammered. things like quantum computing, it will be cool or 10, 20 years too early, maybe meta. maybe one day we will live in the metaverse. is that what you mean by themes?
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>> yes, but not sort of micro as that and some more larger and global and more clear. charles: i gotcha? >> i think about, when i first started to get into economics i went to my first starbucks and i remember saying to people around me i come from, my family comes from europe. this coffee thing really has got something. nobody in the u.s. is going to actually pay that kind of money for coffee. charles: right. >> think about what happened in the growth and the type of restaurants that we had? now would i have been six months after that, 12 months, 18? no. the first thing i think of when you talk about any investing right now, thematic investing especially you have to give it time. we're talking about pension money, 401(k) money, talking about long-term money. charles: right. >> not looking at -- charles: this is not a from the song, roll of the dice this is what changes your life. >> this is what changes your life. this is what changes your
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wealth. this is what changes your way of life. this is a.i., clean energy. e-commerce. these are things we see happening around us. charles: right. >> so you have to be able to give it the time in the market instead of worried about the market timing. charles: i got 20 seconds, real quick, does value and defensive since the second half of next year may be more forgiving could we switch into growth and offensive a little bit? or stick with the value and defensive? >> i would stick, rather be a little late than a lot early. i would stick with values and defensive with quality stocks. then if i'm going to take my growth i would take it in the long-term bucket in the thematic sense. charles: right. >> the world has not figured out how it will rewrite multiples and deal with what's now 4% interest rates. clearly now going to five. that sort of threshold of where the world might have trouble. so why not be safe, learn. buy bonds, right? you can get five, six, seven, 8% to hold a bond for three years. mind you, if you're doing that
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in your tax advantaged investing, if you're doing that in the 401(k) you're doing it without tax friction. so let's be thoughtful what we're doing. let's do it in the short term for what we know is true and invest for the longer term in the areas that really are still climbing that wall of worry. charles: great, great stuff. that's why you're the best. alii we appreciate it. >> thank you. charles: my take on the mainstream media wrapping up fear and anger. they have been doing it for a long time. it can't get to you. some last trades you might want to consider before the closing bell. ♪.
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gina bolden. rob, you've been a buyer in most of the rout. it has been a lot of fun, obviously the dynamic changed, right? >> absolutely, charles, look at the velocity today, buying the dip you're buying much bigger discount than we've seen the last few years. tough put it in perspective. your previous guest talked about themes. some of these things are not to be bought turned around in three to six months f you have three to five years, especially younger investors this is the type of market you look at. charles: you talking about me. i'm the youngest of investors. gina, meta, dash, got upgrades from major firms this morning. is it time to look at some of those well-known devastated names for bottom fishing? >> well, when you're talking about large cap tech, charles, you know we're not convinces now is the time to buy technology. earlier this year we
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overweighted our portfolio towards value stocks and we're kind of neutral on tech but keep in mind being neutral on technology is having a 30% exposure to tech. the s&p is 30% tech and right now we don't think investors should have more than that allocation in their portfolio. charles: gotcha. cpi, foregone conclusion this week overwhelming majority of folks think it will be sizzling. rob, when something is conventional wisdom, that is when we get surprises. that is the essence of surprise. could we be set up for a surprise, when we start to see inflation turning over, will that be something of a buy signal? >> charles, this market has so much cash on the sidelines, so many people are negative right now, if we see anything at all, especially like a cpi coming in cooler than expected, i'm a little bit worried because the
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cleveland fed is good predicting that. they don't see that right now. remember we have an election tomorrow. there are things that could definitely move the market. consensus is not your friend. if you go against that, get that right especially a market like this, charles, we'll be off to the races. charles: gina, i want to pick up you're leaning value. inflation comes down a little bit, the fed says we'll step down, decrease rate hikes, or pause even though powell says he won't, will that alter your approach to this mark at the time? >> we think we hit peak inflation, charles and we're starting to see evidence of that, but we think the point is and what investors should pay attention to we think it will be painfully slow for inflation to come down. however when we start seeing some of those wages coming down or if we start seeing some of this sticky inflation that is going to be very, stubborn changing, we may see rates coming down next year that would
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be the time to jump in to buy technology. -- [inaudible] charles: i am sorry to interrupt. i got a minute to go, gina. i want to get from both you guys the importance of tomorrow's outcome. say for instance, if there is a gop sweep how does that impact the markets? >> well the sectors would do well -- charles: go ahead, gina. >> sectors will do well in that scenario. hopefully that is the catalyst to make the market go higher. we think it could be an early santa claus rally. we think financials, energies, health care, aerospace will do well and the republicans will provide the checks and balances to help limit regulation of those sectors. charles: rob, i tell you, i never seen you tweet so many political tweets. obviously you're thinking about this a lot too? >> you know politics is all about the economy right now, charles. a few data points. look, six months out of the midterm the market has been up since 1950100% of the time, 14%.
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now when you have the republicans take congress though with a democrat sitting that averages 17%. last time that happened it was clinton though. that market was up 23%. i think we're poised for that too happen tomorrow. people are tired of what is going on in congress. they're looking for a change, looking at 401(k), pretty soon the real estate market will take it on the chin. people are tired of what is going on, charles. i think we'll see change. charles: they will do the ultimate process, democracy protest. they will go out to vote. rob, gina, thank you very much. on that note, my takeaway from the mainstream media and gut-wrenching headlines, don't let it impact you on the way you vote or invest. ♪
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