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tv   Making Money With Charles Payne  FOX Business  November 18, 2022 2:00pm-3:00pm EST

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fitness program at no extra cost. you get all of this for as low as a zero-dollar monthly plan premium in many areas; and your doctor and hospital may already be a part of humana's large network. there is no obligation, so call the number on your screen right now to see if your doctor is in our network; to find out if you could save on your prescriptions, and to get our free decision guide. humana, a more human way to healthcare. >> a quick look at the markets and the nasdaq is down and dow is slightly up pairing earlier losses and something good to hand over to charles payne. charles. charles: i'll try to take it from here, dave. thank you, my friend. good afternoon, i'm charles payne and this is making money. breaking right now, the federal reserve has shifted its jawboning campaign to a whole new level. mueller and company daring
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investors to even have hope. will that crush the economy because of public is holding onto the thoughts. i have jim paulson, lance roberts and jared lamb here to weigh in and new calls for authorities to resist regulating and let crypto burn itself out amid the ftx aftermath and the 125 year history. can you guess. i don't want you to cheat, take a real guess and i'm interested on what's your favorite book and my take away on what ftx is the latest example of how americans, all americans are being ripped off by the elites. it's the ultimate wakeup call we can all push back now with the time to strike. all that and so much more on making money. >>
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charles: that iconic moment from the movie was aired yesterday and they told the bulls to come out and play. bull administered suggested that feds could raise as high as 7% it. is a chart he used. fed funds are here now and says the low range maybe there's a high range of 7%. if we get to 7%, folks, better learn how to grow your own food. here's the thing, bullard, they were chiming in with taunts and cheers and leaving no doubt they're the toughest gang out there and they're united in their goal to fight inflation. here's the thing though, what bullard said out loud and meant
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to crush any enthusiasm and dubbish assumptions with the monetary policy and rate cuts. think about that for a moment the federal reserve doesn't even have to -- even want you to think that you could be doveish or they could be doveish. they want to hammer away at the economy. i want you to think about that because bull lard, he should have finished by saying can you dig it. what's happened right now with the state of the economy already from inflation woes. stocks did find their footing later in the session and in fact they found footing today. still though the fed has umped the ante and any inflation report that comes in and the slightest bit stronger than expected will trigger probably harsh reactions and here's the rub. inflation has taken a toll on assets and now the coup de grâce
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could be the fed or stock markets or bonds could hammer lower. joining me is chief investment trait jazz jim paulson. jim, these days nothing seems to upset members of the fed more than a stock market rally. they're trying to subdue folks like you. i got to be quite frank with you. you are not cowering in fear and been out there constructive and what would it mean if the terminal rate was 7%, what would the stock market look like? >> well, i don't think the bear market is going to happen, i really don't.
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one thing is they're losing control, the fed, i believe of the long end of the bond market. let's say everything five years and beyond that they really can't push up any further even with jawboning because what has happened is that inflation fear used to be the number one fear in the country and it's being replaced with recession fear. when recession fear gets greater than inflation fear, what it means is you're going to have more bond buyers than sellers and no matter what the fed says, you're going to -- by talking tough now they're raising recession risk and lowering inflation risk and creating a rally and bond yields. charles: ironically it says if the fed gets to 5, 5.25, they're going to break something and they'll have to cut rates two more times before the year is over. you brought up market schooling, i really find it amazing.
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last night and this morning, you had a bunch of retailers. retail stock withs the amazing earnings, foot locker, gap, burlington, ross stores and the stocks are having a great session. i bring this up because earning season was supposed to be the death for the market. it didn't work out again. how long will this happen because we're hearing wait for the next round of earnings and the market goes down. >> yeah, right now, forward s&p 50012 month earnings off five% from the highs and market's been down 25% already in the earnings just aren't coming down. i do think we're going to slow and i think we're slowing as we go onto next year to get slower and i'm not so sure that earnings don't, you know, rather than come down a lot, maybe just flatten out, charles, overall.
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we've got a healthy balanced sheet and squeaky clean bankment and hard to break something and the fed is trying hard to do that. charles: jim, you've been too bullish and may wake up tomorrow morning with somebody outside your door jaying jim paulson, come out to play. be careful,man. take it easy and have a great weekend. >> i will, thanks, charles. charles: retails having a pretty good earning season here and palo alto posted amazing earning season and cybersecurity might finally be living up to the hyper-and bring in the managing director dan ives. some notice that had the company is being more aggressive with the respective government contracts and you've got to buy on it. what's most appealing to you? >> i thought that was just a massive demand number that they're seeing the print and cybersecurity is holding up well.
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investors love the rock and sector in terms of cybersecurity. charles: i guess the only caveat i would add and it's volatile still. when they miss, they take a pretty good hit. >> no doubt, but if you cassioppi this economy and cybersecurity is holding up firm and this is soft wired and another large name withs microsoft with the ways to play and like you were talking about with jim and the bark was worse than the bite in terms of earnings and seeing the risk on this market. suggests a lot more carnage before the things firm up. what are you looking for? >> yeah, look, i think they've
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created a dexterity term in earnings and cross across the board in terms of meta and streets start to adjust and i ultimately going into 2022, growth will clearly be soft but that's already reflected in the stodges and look at names like apple and microsoft and in terms of being significant buyers here going into next year. i still think this is not the end of big tech's run. i think it's more of a maturity and hyper-growth for the tech. charles: the niche excelling in the new tech world. i want to ask you about this solar niche. it is crushing it end phase with some of the other names on the board here. could they be part of the changing of the leadership guard? i'm talking about the next five to ten years if there are new leaders and little niches of leadership and tech, would that be one?
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coming and going fully ev over the next decade and disruptive plplays and ted cruz and energy and -- tac and energy and the investors are focused there. charles: the bark worse than the bite, where do you see the fed. how is the fed modeling in your work for you in terms of technology turning around? where do you see the terminal rate and when will this no longer be the key dark cloud. and they'll have to talk a game of high stakes poker with the doves and take the foot off the pedal and i believe tac and risk on assets start to rip higher and investors are kind of seeing through that going into first half of 2023. that's why a lot of stocks have
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been rallying last three, four weeks. charles: yeah, some of the rallies like the chip rally has been bind boggling but maybe that's why they're coming out so hard this week because they can't push back the jay jawboning and networking this week. >> when buffet starts buying semi-names, you've got to take note. with taiwan semis, they should. they've got to point and these tech names go higher. charles: i agree 1,000%. have a good week weekend, dan. resilient consumer but that's not a spriest surprise for my next guest. lisa ellis is the senior managing director and third quarter wrap up, lisa says her top sector theme, it was titling defying consumer and remaining extraordinarily stable. lisa, goldman says americans are sitting on -- this is mind blowing to me, still 75% of
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excess savings and even >> consumers are sitting on the stockpiles of cash leftover from the pandemic and either from direct stimulus payments or in many cases not spending as much and not traveling or commuting and we're deep in that with consumer spending and the car networks and payments companies
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report earning ands they people aren't buying goods and taylor swift tickets take down ticket master and everyone is trying to get out and go back to the evevents and across the board is been pretty level. charles: two things to ask you. first about the macro-themes and head winds inflation and talking about the higher interest rates and recession. how do you model for those things?
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more optatively to look across and incredit card sours and bake in the view and as the view changes, we change our estimates. charles: right now, from the main stocks that i saw that you follow, you know, charles: this is a full page add in "the wall street journal" and trust us. we all know, when someone says trust us, you automatically don't trust them. are you not worried about this cryptoimplosion? >> for coin bake i'm not. this is a publicly listed company, fully licensed, fully audited and look at exactly where all their customer assets are sitting and they're segregated and legally
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protected. the way a typical traditional institution is and they've come out and been very clear and they've had something on the order of about this is a company carrying over 5 billion on the balance sheets and have second order of eff eff effects and soe millioning out in general in all crypto and seeing floors from offshore coming back into coin base in the u.s., which is a positive and they've openly said they don't know where that's going to shake out yet. charles: you've been an fire, lisa. have a great weekend. >> terrific, thanks, charles.
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charles: so many ideas and trends and everything, every day i want to discuss there's not enough time. but i do invite you to read my daily market commentary and write every single day and night, you'll love it. coming up next, get out a pen and paper. going to fundamental school and learning more about the economy and so many questions and the guy with the answer, brian west bury is the best and he's right after this. ♪
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january and here's the thing. we do know that calling the recession and if it did happen and every time there's a recession and it's the finish line and it seems inevitable and why is bullard firing all these shots? >> you know, charles, going back to them and it's a business being a forecaster no doubt. especially today because so many things they have done and so many things we've never done
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before. and the only thing i would say about the inverted yield curve is that every single one of those interest rates in the yield curve is still below inflation. normally going back in history, it takes the fed hiking rates above the rate of inflation to be tight enough to throw us into a recession. having said that, i still, you know, if you look at good, spending on goods. we couldn't go to move i haves and sporting -- mo move movies d sporting events and we spend $1.4 trail more on goods in the pandemic than if we continued on the normal trend. you're seeing the price being paid for that. we're seeing retailers laying off people. amazon laying off people. all of the that combined with the rate hikes leads us to a
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recession and decline in corp. corporate profits going with it. charles: brian, what does the political pressures and elizabeth warren saying the difference between land ago plane and crashing a plane. it's a tough statement and hard to disagree with her but in divided government, you wonder will there be a i thought when the republicans win we'll have a recession. now that we didn't have the massive red wave, seems like the democrats would own a recession if it happens. i get elizabeth warren worrying and the federal reserve is completely changed the way it manages monetary policy.
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there are now $5 trillion at least of excess reserves in the system. if the fed's paying 4% on the reserves, it means the federal reserve is paying private banks $200 billion a year right now. i don't know if elizabeth warren has focused on that yet because if anything were to bother the democrats, the government is paying banks hundreds of billions a year. it's a fascinating political interaction with the fed. charles: that should bother all politicians as lending standards get tighter and tighter. thank you, brian, my friend. appreciate it. coming up later, folks, shoplifting cost $400 million in losses at target. this is a bigger story and we'll really delve into what it means about the reflection on society
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but first, should regulators pump their brakes with respect to putting more regulations on crypto? some saying let it burn. we'll ask bitcoin advocate mark moss and also congressman warren davidson is on deck, next.
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charles: questions are piling up as hope for customers of ftx even getting back a penny. with me now is the host of the show, mark moss. mark, if this thing hasn't blown
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up, next week bankman-fried would have been at a new york times event featuring him, president zelensky, larry fink and janet yellen. what does that say about his fear of influence and maybe why this thing was able to grow into a $35 billion scam in the first place? >> yards in aggie, it's no doube hassing. both of his parents are professors in the democratic party and ties with the sec, big hires of the cftc, and massive money donations to the democratic party. potentially for protection, which now they're really trying to distance themselves from. charles: so you -- i was checking out your tweets and you say you expect larger crashes and i'm thinking, well, what could be larger than ftx? >> well, it's a $10 billion hole they left and i'm guessing hundreds of thousands of
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families completely wiped out. they were the second largest cryptocurrency exchange so who would be bigger? there's people behind the scenes so yesterday we saw genesis, which is kind of a back water company for a lot of these. they provide liquidity loans, et cetera, lot of yield farming and whatnot they had to ask for an emergency $1 billion loan. we saw the cryptocurrency exchange gemini, one of the largest halting withdraws from that as well. we don't know who has exposure from the $10 billion and maybe not customer wise but dollar wise and genesis has hundreds of thousands of bitcoins in kansas difficult charles: you're looking for the crypto winter that we've been in for some time to become permanent. you think it could be a good thing, why? >> when i say crypto winter, i'm talking about if you understand the way it works, venture capitalists investing in the company and dump them on retail
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for 10x, 20x returns and adventure capitalists love it. if regulations crack down on this, venture capitalists won't be able to play the game and a lot of money leaving the ecosystem. a lot of money in crypto will find its way into bitcoin, which is the only digital asset that's been deemed by the sec and cftc as a commodity. i think a lot of money floating around in the gambling so-to-speak, will find its way into the only digital commodity we have. charles: mark, you warn along that line of thinking between the debate of commodity and the security that if the sec makes 99% of the token securities, what's going to be the fallout there? >> yeah, it is it'll still survive and a lot didn't like my tweet and it'll all go offshore. sure, innovation will happen and goes offshore. that's okay. but the u.s. financial engine as i said, this capital base of venture capitalist in the united states won't go with it and continue to do the pump and dump
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ponzi scheme and it'll see 99% of the tokens disappear. sure, offshore it'll be there and it'll be a very small piece of the ecosystem. it'll be very healthy because now all of these to tokens thate stealing value, kind of like a denial of service tack against bitcoin will be wiped out and we is see the true supply and demand of bitcoin and what it can do for the ecosystem. charles: mark moss, i will reiterate you say self-custodian and keep pounding the table. you're one of the best on it. i appreciate you sharing that information on it. thanks, mark. >> thanks, charles. charles: now there's a major outcry for regulations but, you know, a private message from sam bankman-fried was released and had this to say about that. f regulators, may make everything worse. they don't protect the consumers at all. well, i want to bring in congressman warren davidson. congressman, you're a member of the financial services committee and holding a hearing next
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month. what's the goal? >> well, the goal is to make public what's been happening in this space and, you know, frankly darren sotteau, a democrat from florida and i had a 100% bipartisan proposal since 2018 to provide legal clarity to have a bright line test for what is and is not a security and get that basic question answered, you know what exchanging can and cannot sell and as your previous guest pointed out, so far the only thing everyone's agreed is not a security is bitcoin. at the time, you know, ethereum has been treated as if it's not. we don't have the same clarity on that. the ripple xrp case is next and in the meantime there's all these other meme coins and everything else out there and a lot looked at as pump and dump scams and some are and aren't and how did this contribute to what hammed at ftx? charles: i saw an article in ft, and i don't always say that and essentially said let it burn.
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they were saying, hey, let all the rip off tokens, let them burn themselves out. you know, let them crash and burn because they say if you regulate them, you kind of give them legitimacy. is there truth to that? >> that's what's been happening. financial times has been a big shield for the status quo for a long time and they've essentially been allied with the people that have proudly supports vented any legal -- prevented any legal clarity for this time and hasn't turned out well and a lot of people are getting hurt and congress didn't do this and frankly whether it was jay clayton or gary gensler, they told everyone in the space, come talk to the sec and work out your deal. what people found out was there was no escape path. once you come in and talk to the sec, you're in discovery and it's hard to see how the sec hasn't engaged in selective enforcement. i mean, they were collaborating closely with, you know, ftx with sam bankman-fried and so was
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this cftc. meanwhile they're going after kim kardashian. really, you got kardashian but didn't get the ftx fraud? charles: from what i read, sbf was helping them craft legislation at cft. with this hearing, should members of congress be allowed to be in any sort of investigation if they took money? should they not at least be returning this money to victims? >> yeah, that's something we're going to take a look at. i mean, look, you know, sbf gave money to my campaign and i'm one of the handful of republicans that have -- [ talk over each other ]. charles: you've take the money. will you give that money to some form of charity aimed at helping the victims? >> yeah, it's $5,000 but, you know, he spent $31 million. it's a drop in the bucket towards what's happened but i think, look, at the time, you know, people thought, wow, what an interesting idea and it seem
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that had it was fire walled with ftx u.s. confidence a more limited range of services from ftx international and detecting fraud and securities and exchange commission didn't see this coming, maybe the sec structurally isn't up to the thursday and saturday and cans task and that has to be the next step. charles: i love what you're saying about the sec and others and all the folks that were supposed to protect the public let us down and wonder why they keep doing that. congressman, thank you very much. appreciate it. >> thank you. charles: the brooklyn public library revealing the most borrowed book in the 125 year history. tweet me what you think it is@cvpayne. how long will investors be bullish and should they be bullish? ♪
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charles: so this morning the market opened higher which not only probably angered the federal reserve and a whole lot of wall street pros want to see retail investors throw in the towel. the last week, this is bullishness. up to 33.5%. that's a 10% move and still not at historic average and this was huge we were below 20% not that long ago week after week after week. what it all means is joining me is riao senior adviser lance roberts. headline piece is hard landing coming? investors don't think so. is that a good thing or bad thing? >> well, could be a bad thing and, charles, five weeks ago you and i were on the show talking about all this bearishness and everybody was bearish and that was good for a rally.
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that contrary investing kind of set up and since then we've had a good rally and now everybody was bearish is now getting bullish, which is probably about the time we need to think about taking a little bit of money off the table here. investors are very complaisant about the fed and every week is the fed going to pivot and is now the time to jump in? we've got a lot of work to do, the fed is still hiking rates and we have not seen the lag effect of the vast majority of the rate hikes have not come into the economy yet and it's a little bit early to be getting really bullish on the market just yet and simply economic bgrowth is going to slow down. charles: to your point, miller pointed out whenever crude oil, the u.s. dollar and interest rate spike in tandem, the earnings for the next year down 35% and you made a similar observation and with the soft landing in 2015, earnings have plunged a lot more than current estimates and let me throw one thing out there and what are the
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estimates are where they are now. what if they're right. >> to your point, if they're right, no recession is coming and fed achieves a soft landing, first time ever and have achieved a soft landing. you know, economic growth is not slowing down markedly and maintaining these historic high profit margins and wages rising skin fellation up 8% and it'll be tough to do and, sure, it's possible and this week i turned 60 and down the line.
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down for the bull markets tend to be several years and this is down to one piece. charles: claiming for himself and use your 2023 and thanks so much and great work as usual. coming up. i'm talk about all of this and republican democrat and black white, whoever you are and we pay the price so that these folks are looking at it making all the money and looking for
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$400 million and profits from them and heres the thing. market accent and he's got a lot of things to break it down, next. ♪
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it's not the same. what could you do to solve the problem? we could get xfinity? that's actually super adult of you to suggest. i can't wait to squad up. i love it when you talk nerdy to me. guy, guys, guys, we're still in session. and i don't know what the heck you're talking about.
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one of the more shocking reports came from target and it was a massive, massive miss. why? in part of the inventory streak and massive shoplifting and joining me @ daily dirt napa editor jared and the thing that bothers me about the target earnings report and many ways it was a reflection of society at this very moment. many people don't realize target, 2016 i'm reading this piece, target takes loss prevenes very seriously and run one of the countries top rated forensic labs and specialize in solving organized retail crime committed at the stores and i'm saying to myself, they could have prevented a lot of
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400 million from being stolen. something is stopping them. and to me, that's worrisome. that speaks to something going on in society. >> yeah, i think culturally, we are uncomfortable with the idea of somebody in loss prevention from the store chasing somebody down and tackling them. there's a lot of retail stores that have do not chase policies. the apple store is one of them. if you go into the apple store, you put on a pair of beats headphones and put your hood over it, they walk out and won't chase you because they don't want to create a scene. that's one of the reasons for this. i looked into dollar general ten years ago. i wanted to buy some dollar general and the reason i didn't was i found that they had a 3% inventory shrink relative to wal-mart, which had 0.1% and i said operationally this company is mismanaged and i didn't invest in it and stock ended up being one of the best performers over the next ten years. i don't think this is really a business issue for target.
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they can raise prices -- charles: society and raises prices means the average person that may go there looking for a bargain will pay for money. >> that's absolutely the case. there's something -- there's a structural weakness in a store, and i've always wondered this my whole life if a bunch of people go in and take stuff at once and run out, it's very hard to stop it unless you lock up all the good stores which inconveneses everyone else. charles: right, this is one person goes 234 and steals something. to me it's worrisome because we should be a nation with law and order and compassion at the same time. another thing that caught my attention and in one race it was a disaster is people having to make a decision between discretionary items and paying their electric bills. that's a scary place to be and it's only going to get worse; right? >> yeah, this underscores that. in the brokerage industry and take a series 7 and apply to work in the brokerage industry and do a background check, they ask if you've been convicted of theft. it's a crime of moral term
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attitude and this is -- turpitude and this is the moral decay of society. charles: talk about what you like in the stock markets. industrials and materials are hot in november and you think that keeps going? >> absolutely. i think what has happened in recent weeks is the underperformance of value relative to growth over the last 15 years has finally flipped and you've seen values strongly outperform and there's a lot of stocks that have single digit pes, high dividend yields and they're outperforming in the move and we've made the tournament charles: this is a secular move. it's not just a flash of a pen, people hiding out till the coast is clear. they'll powell back in the growth and it's a long term growth you think? >> i do. this echoes what happened in 2003. 2003 was the end of the .com bear market and tech stocks stayed down for ten years. charles: yeah. >> really what rallied was industrials and basic materials, companies like u.s. steel and
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cleveland cliffs and hard industrials and even ge at the time. so that, i think we've actually made the turn into value. it's a little too early to say for sure. charles: well, i remember it took microsoft 14 years to get off this. thank you very much, jared. i got something for you, jared. the brooklyn public library celebrating 125th year in business and put out the list of 125 post checked out books. what do you think the number one book checked out? >> harry potter. charles: stick around for the answer. it's where the wild things are. could you imagine that? they have like 140 versions of it in the library and they're always checked out. i got some great -- by the way, the twitter audience gave us good ones too. meanwhile, what's happening with ftx, folks, this is not isolated, it's not new, but it's got to stop. why i think this is the ultimate wake up call and everybody in america outside of a few elites are the victims of this stuff
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over and over again. let's stop it together. ♪
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