tv Making Money With Charles Payne FOX Business February 7, 2023 2:00pm-3:00pm EST
immigration, foreign policy. our "fox news poll" shows the president upside down in all these things. we'll see what he does if he changes minds to night as we listen in at nine eastern. jackie, taylor, brian, back to you guys. jackie: we'll watch. shannon bream thanks as always. thank you so much. of course we'll watch very closely -- taylor: 8:55 p.m. not nine. brian: we'll see. shannon says it will be positive. we'll see if it is political that is the question a lot of people have. taylor: well be here tomorrow to break down highlights. the economy, inflation, impact for your money as well. we'll do that postshow analysis here as we sort of tie? all the policy and economics into your world. here is the best news. "making money" with charles payne coming up right now. what are you doing? charles: tonight i'm saying it will be political. put my money on political. kumbayah hardly ever is. so the market.
up and down a lot. thanks a lot, guys. good afternoon, this is charles payne, "making money." breaking right, stocks were down a lot, they rallied a lot. now you can see they're down a little bit more. federal reserve chairman i'm not sure if he corrected the error or knot. here is the thing, wall street experts loudly campaigned for jail powell to come to curb the enthusiasm for the market last year or they would say, correct the error. powell walked a tightrope, right? i think what was most noticeable at least for me, one of the very first words out of his mouth, this inflation. he added urge stuff about service sector strength, saying they would be restrictive quite a bit of time, none of that was man bites dog stuff. later at end he reiterated common knowledge. we have best to break it all
down. ed yardeni, shah gilani, jim kemp mark newton on deck. machine learning machine intelligence is romanticized by humans for centuries. the process began in 1957. now it has gone into overdrive. we're discussing the a.i. wars, how you can benefit with sarah kuntz. callie cox is mere with us as well. she will give insight for the state of the union from investors point of view. 2:50, my takeaway on big government versus capitalism. all that and so much more on "making money." >> all right, by now investors are used to competing narratives, right? they abound everywhere. of course you know the message from the markets, message from experts, message probably inside your own heads they never stop. we got some today. federal reserve chairman jerome powell, the defacto boss, commander-in-chief of shoutouts,
labor con my is strong because economy is strong. janet yellen had intriguing comment you don't have recession when you have the lowest unemployment rate in 53 years. what is intriguing that is not true. at start of recessions employment rate is 4.7. that is very low. we've been 3.6, 3.5. most recently the last recession started at 3.5%. don't let low unemployment rate fool you whether or not we could to into recession or not. on that note, however, goldman sachs, they came out yesterday, said you know what? they think there is only 25% chance of recession. right now on average, there is 65%. that is what the street is looking at. goldman way below there. by the way my first guest, he is taking his goldman call a step further, saying no economic or earnings recession. joining me now yardeni research president ed yardeni. from what i said, earnings up a
little bit over 4% this year. 11% next year. >> yeah. charles: pointing out what is really amazing you have got 63% of companies have mentioned positive forward earnings. the slope is moving higher, three-month change. when i see this in your work, i never hear this narrative anywhere else. does this suggest soft landing? >> i think it does. actually most of the data from last week suggests no landing. the economy is still airborne but looking forward i do expect to see some slowdown in the first half of the year. i think there are still inventory adjustments up ahead. maybe consumer spending slows somewhat. i don't think that adds up to recession. by second half of the year, instead of widely expected recession i think economy will be doing 2%. charles: with that as a backdrop, where does that put the s&p 500? what are your targets? >> well, i think you know we got pretty quickly to our near term
targets of 4100 to 4200. we think the markets probably going sideways and maybe bounce around for a little while here but i think we'll probably see 4500 by the summer. ask me again if we get there i will probably talk about a new record high of 4800. charles: so i will take that for now. >> by end of the year. charles: 4800 by the end of the year. so i'm not sure how much of a jay powell's speech, press conference, interview whatever you want to call it you heard but it was, to me fairly intriguing. >> i heard the whole thing. >> it was intriguing to me. you watched that. you watch the stock market side by side. i felt there was no news per se. some have interpreted that last part where he reiterated hey, if inflation stays high we'll take action as being, you know, sort of tampering, tamping down the enthusiasm from last week. i didn't interpret it that way. how did you interpret it? >> i think it all depends not just on the employment data but
on the inflation data. next weeks we'll get a cpi number. we'll see how that plays out. if we get relatively strong economic growth, no landing, inflation moderating, continuing to moderate, the fed's really going to be sort of like, you know, in a bind. what do they respond to? they should respond to moderating inflation. i don't have any problem at all with the no landing scenario with inflation moderating. charles: right. >> the ugly scenario is of course no landing with inflation suddenly rebounding. i don't see that happening but that is a concern in some circles. charles: real quick then, with that in mind, you know, staying higher for longer, feels to me maybe the street is getting used to that. the notion okay, maybe we'll be at 5% fed funds rates for period of time. that is not necessarily dissuading investors. should it? >> i think it reflect the resilience of economy. we've gone from fed funds rate
from see to 5.25 by middle of year. 25 basis points each of the next fomc meetings. in that scenario the economy can continue to chug along. if that is the case, that explains why the market is hanging in so well. charles: it certainly does. i love your work. >> thank you. charles: it is always your work. no one else's work. you don't jump on bandwagons. that is what i really appreciate. thanks a lot. >> my pleasure. thank you. charles: all right, folks, this continues also to be a retail investors, call it a mardi gras, right? it has been a party. my next guest says, party as long as the music plays. bring in money map press shah gilani. i was paraphrasing you. you didn't say those exact words. why do retail investors love it? last year their favorite stocks got slammed. this year those same stocks up 46%. so you know it just seems to me that it is one heck of a party
but wall street is really angry this scenario is playing out. you say ride it for now, right. >> reminds me of chuck prince of citi, as long as music plays you keep on dancing. this is everything rally. investors took losses in december of 2022 and then jumped in january. if you look at everything from bitcoin to zombie stocks, stuff that has no earnings, no profitability, everything is through the roof. some of these meme stocks are up 90 plus percent, it is ridiculous but again the music is playing, you got to keep dancing. i think this can last a while. you look reaction in jay powell's speech, i didn't see anything moving markets. they reacted and unreacted. we're back where we started. we have room to go higher. the point here is very simple, chars if we see more money come in off the sidelines we could see a monumental melt-up.
we've seen something of a beginning of it. there is a lot of money on the sidelines. the market can go higher. i'm not saying it will but the lean something toward the upside. charles: last time you were on you were very constructive as well. in part seasonality. people sell in december, take tax losses. then they start to get aggressive in january. we call it the january effect. i want to ask you about the february effect. in years a double-digit decline, february to february, every single time preceded by down month, down februaries in the first three weeks of february. how important is it for the january rebound, right, this january rally wit my be knee-jerk, oversold buying any of those things that continue throughout this month to sort of solidify the notion this could be a good year? >> i don't know that a february effect so to speak is going to be important. one month in february will not make the year even though i think january, used to be old
saying so january goes so goes the market. i don't think january is be-all-end-all. companies are on sale a lot of quality companies on sale, a lot of money trillion dollars on the sidelines even though the sideline money, now the cash is getting a decent return, some of that money may not flood back in, if it start is to come back in a lot of money managers on the sidelines have missed this rally. charles: i know. if they can't jawbone it down, if we end up much higher today, i think they will have to bite the bullet to get involved. let me ask you, shah, to be in the rally, not susceptible to another rug pull. we saw four or five bear market bounces last year fall completely apart. >> that is not unheard of. it may happen again. the simple solution there use trailing stops. if you have profits in the positions you have, move the trailing stops up. if you get stomp out on market
swoon you're out and get back in lower. you have to be in right now. it is very easy to miss the market move. we can go higher. i'm not saying that we are going to but i'm taking a lot of positions on making sure i have my stops in place. charles: that is discipline, it forces your hand, takes your emotions out. love it shah. thanks my friend. >> thanks, charles. speaking of excitement, folks, a lot of excitement over these a.i. wars, microsoft, google, duking it out. breaking news, 20 minutes ago apple making a big announcement. they're all in, folks. bring in cleo capital managing director sarah kuntz. it is all about a.i. these days. is it too early to pick the winner or lead favorite? apple is saying we've got something too. >> the thing to keep in mind with a.i. it is really, really, really expensive, right? there is a reason the biggest start up right now in the space, most of the hundreds of millions of dollars they raised from
microsoft, right, open a.i. were in the form of credit, cloud computing credits because it is so incredibly expensive to do the sort of computer calculations that allow to you get these amazing a.i. results this will be a game for people with very big war chests. i'm not surprised to hear that apple is jumping in. google was inevitable. they have been very interested in a.i. for a very long time. certainly microsoft has a pretty big lead here because they did do that open a.i. deal. charles: you know, that is a fantastic point that you bring up. there is a lot of smaller a.i. plays. in fact if you're a company with a.i. in your name, the stock is up big this year. could we see some major acquisition activity as these larger players position themselves? >> you know right now i think we're going to see an arms race. the computing power costs just money, right? it is and energy cost, talent, people who know how to do artificial intelligence this isn't sort of your standard software engineer. they're going to be a huge arms
rush. you know, look for these companies to be recruiting like crazy out of universities, you know, out of big legacy companies. anybody with a degree in a.i. right now, practical expertise. things like sern, where the his came out of a lot of scientific breakthroughs came through a.i. this will be talent arms race. charles: you're still big on cybersecurity. you still like al palo alto the most there? >> i do. with sort of white-collar recession happening across tech, across places like finance, you have a lot of very smart people walking out of the door with giant chips on their shoulder, not to mention, you know, some of the international security concerns from china, from russia. so i think that we're going to see a lot of companies investing heavily in keeping their cybersecurity defenses high. charles: you know before you go i got to lean on your vc
experience. the ipo market may be coming back. panera bread saying they will go ipo soon. here is what bothers me, sarah. i hate the idea, vcs, silicon valley, wall street abused public with overvalued ipos for a long time this year we haven't had a lot but what we had in terms of ipos, the best ones are up 10, 20%. this is just this year alone. return from the ipo already, one stock down 52%, another down 48%. another down 44%. is it possible that we could have maybe the next wave of ipos that are a little bit more contract about the individual investor? >> you know, it is actually interesting, we need to keep an eye on supreme court case actually against slack. you know, they did a direct listing. they did an ipo broadly seen as better for the little guy and now they're getting sued by one of the big guys who doesn't feel like they made as much money as they should. that is a case i'm looking at.
all the talk of panera, all the food ipos is making me hungry but not necessarily to buy. charles: sure, sure. by the way the financial media played a big role in this. every time a company goes public, gap higher, look at all the money they left on the table! a source of embarassment. you had to go ipo, the stock had to go straight down because you ripped off the public. sarah i will leave it there before i get on my soapbox. sarah, thank you very much. always appreciate your expertise. i love to hear from you. rate your own state of the union, the economic state of the union, how you feel, tweet me. i want to share a lot of those, as 78 as i can later in the show. in fact i got one from nicholas who tweets, financially struggling, more divided than ever. bingo. keep comments coming. next grab a pen and pad. mark newton is here. this is more than chart school, explain the best way possible using charts why he sees the s&p
going to 4500. you want to hear this right after this. ♪. mom. can we get a puppy, mom? please? girls, pets are a big expense. aww. [ audience cheers ] maybe try switching your car insurance to progressive. you could save hundreds. [ audience laughter ] thanks, tv dad. we'll think about it, okay? look what i found. -a puppy! -a puppy! oh, no, no. i wish tv dad was always in charge. [ dog barks, audience laughter ] listen to your tv dad.
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♪. charles: sew my next guest was cautious for most of 2022. he was right for most of 2022 but now he thinks that the bear market lows are in place and the s&p 500 could hit 4500 this year. joining me now, fund stratglobal advisors managing director mark newton. and, mark, here is the headline from your note, year-end target, you had two cases, right? you have a base case where equities turn higher sharply in the first quarter, looks likes that is happening, whether market fall may to june, that is yet to come. either way get us to 4500. >> no, the first case will be 4500. the second case is five to 10% gains. i'm anticipating strong gains for the year after what we saw last year. charles: you see all the different sort of pressure out there. the idea that this scenario ironically makes the fed's job harder. if the fed's job is harder it could create this scenario. >> right.
yeah, it is an interesting happening between these two scenarios. look, sectors have turned up very rapidly. we've seen almost the entire turn up outside of technology. that is now playing catchup. now it is the third best-performing sector of the entire year. couple strong market performance, strong birth with huge amounts. comb nation of all those suggest this should be much better than last year. everybody is ignoring it. they are saying the market lost touch with what the fed wants. seems like they have lost their touch because they're missing the rally which has gone up over 10% in the first six weeks of year. charles: certain people miss it the experts, the pharaohs of wall street, they spend so much time trying to jawbone it down. eventually they miss it they got to jump in later. we go to 4500. the idea how do we make money? coming into today how we're looking this year.
you're overweight energy, health care, industrials and technology. >> right. charles: a couple of these, right, energy is underperforming health care is underperforming. what turns those sectors around? >> health care is a little bit after defensive trade. we're into the month of february which can be a little bit choppier. so my thinking health care is getting very close to a bottom. i particularly like biotechs since i'm fullish on market this is year. i think that outperforms. pharma has gotten pressured. some might be politically driven. i think that group is close. energy it depends wti crude moving up for e and ps. refiners are in great shape. energy services integrated, really just the e&ps energy should be very close. it began a multiyear bull market in 2020 when crude oil bottomed out in march. charles: there was a point crude oil stocks were higher or elevated as crude oil came down. this might be catchup time. then we'll get them both back in puny son. let me ask you about technology
because the chart looks absolutely phenomenal. this is the xlk versus the spydrs. so certainly rallied big time. you know people get excited when tech starts to move. could we talk about a move all the way back to here? how long would it take to get back to the all-time highs? >> if it happens, happen first half of the year. we would have a back and fill and strong finish like normal seasonality. before you pull that up, look at downtrend exceeded by the tech versus the s&p. that is extraordinarily strong. a lot of that recently has been some "faang" names stalled out a little bit in the last few days but overall broader technology is making a very good move for the market. 27% of the s&p. you need technology to work. charles: i have got to ask you then about the homebuilders. i mean i love the way they're acting this is counterintuitive. now people saying maybe home rout is over already. >> yeah. charles: do homebuilders give that some credibility because home bidding stocks are a
phamnal? >> we're seeing signs the housing market slow down is thank youing a little bit, that could be bullish a little bit w rates from 4 to in30, to 3.30. i like buying dips. charles: third year of presidential cycle 92% of the time it worked it is up. twelve% returns after cpi peaked over 5%. 20% returns after negative midterm years. last year was a negative midterm year. 49% after bear markets. it that october low was the low could we be looking at something really substantial? >> that will take time. baby steps as they say. look, this quarter is the most bullish quarter of any six teen that make up presidential election cycle as we know. so you balance out bullish seasonality with bearishness and very good breadth and momentum i think we're on the right track. charles: great work, mark. appreciate it. >> thanks, charles. charles: coming up all eyes on the state of the union tonight but what should investors be
looking at? what is their state of the union? no one knows better than callie cox, joins us at 2:50. russia's economy reportedly will grow faster than germany and britain this year. how is that possible? didn't we unplug them from global -- what the he heck is going on? one person die ties it together, rebecca heinrichs is here after this. ♪. ♪ ♪ wow, we're crunching tons of polygons here! what's going on? where's regina? hi, i'm ladonna. i invest in invesco qqq, a fund that gives me access to the nasdaq-100 innovations, like real time cgi. okay... yeah... oh. don't worry i got it! become an agent of innovation with invesco qqq
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senior fellow rebecca heinrichs. and, rebecca, the dod says this balloon was 200 feet tall, had amazing photographic material, possible explosives was as big as a regional jet, potentially could weigh as much as 2,000-pounds. i think about all those things, seems like could be a dry run for any number of things. what is your assessment? >> well you're exactly right, charles, it was massive. the size of at least three buses. this thing was enormous. that is why it is unprecedented. you heard the dod say there were incursions during the trump administration. we can deduce using our own reasoning they did not get as big as this one and did not come across the entire continental united states. this is a major provocation on part of chinese communist party. this is violation of american
sovereignty. the americans people's response was healthy and good, ultimately pressured the biden administration to shoot it down even though i think it is incredible until it went across the country. this should wake up people galvanize the people in the american government. anything belongs to china crosses in your airspace it immediately gets shot down. charles: i'm glad you brought up the point in the past these other balloons drifting in because the media, they pointed it out but was interesting about it, the only reason we found out this time because of actions the administration, biden administration taken to be able to you know identify this sooner but if that is the, if that is the case, it does beg the question, why did they not, why did they let it, one week tour through america over you know missiles silos? why did they allow isn't what do you think allow the one-week sightseeing mission when they
could have shot it down over alaska or any number of places? >> this idea that they had new special technology enabled them to see it because of foresight of president biden that the last administration didn't have, you could see it with the naked eye. it was local news reporting called out the fact they could see the spy balloon. there was no secret technology that joe biden came up with. but the second thing i would say is, you know, i think they were just, i think it is shocking. it was shocking the audacity of this. the intelligence community has always bent to, the way they're inclined get more information about what the enemy is doing. i think there was hesitation probably on their part. i'm speculating to some tee agree here to take action. obviously a big deal to be shooting down. it is military action. took a f-22 for goodness sakes to shoot this thing down. i think there is a little bit of head in the sand going on. the american people seem academic the threat that china poses to the united states but when you see something like a military aircraft spying on us
in our sovereignty, it wakes you up to understand how bad and serious. charles: it was bold, it was brazen. before i let you go kind of handicap, i'm hearing more and more people the probability of a china united states confrontation has moved a lot closer over the last few months? >> well, i mean, it is sort of counterintuitive sometimes. the answer is not to back down to take more conciliatory gentler approach to china they have to see the where the hard boundaries are. they continue to creep, creep. they have been getting within tens of feet of american military aircraft flying in international airspace in the pacific. they are continuing to be more brazen. they have to be made to understand that we're not going to back down. we'll defend our own sovereignty, defend what is legally, lawfully where we're allowed to patrol, where we're allowed to be of the biden administration is not inclined to be tough like this. unfortunately if they don't change course, change their posture, you will have continued chinese provocations in a way
the american people will not bide. charles: rebecca, appreciate it. >> thanks, charles. >> possible military confrontation with china and united states with my next guest. joining me trend macro chief investment officer don luskin. don, you actually from what i read, that could be potential black swan, some sort of military confrontation between the two nations? >> it would be unprecedented in human history for two giant nuclear nations to go after each other at all who happen to be each other's largest trading partners, right? so that is the thing that makes it pretty unlikely to happen but that's the thing if it does happen, makes it the end of the world twice over because we will be a pile of glowing radioactive ash, oh, we won't have any imports or exports. charles: so is china taking advantage of that? at what point, how do you curb the things rebecca just talked about?
do you let it keep happening because you think of the worst-case scenario being out there? >> you know i find the whole thing faintly absurd. the idea of a giant balloon visible to the naked eye by anybody american turns his gaze skyward, the size of three buses, the idea of using such a thing to spy is so absurd on the face of it there has to be some story the american public isn't being told but what has been leaking out over the last 10 years that the american public is being told, we continue to turn a blind eye to, the network of chinese spying that exists in every american company, utility, boardroom university, laboratory, congressman's office. the infiltration of chinese influence in every aspect of american business and politics is shocking and this balloon is nothing because you know, that is the one that everyone can see. it is what you can't see that gets you. charles: tonight the state of
the union, "axios" admits it will be a tough sell for president biden. what do you expect to hear? >> expect to hear? you think i'm actually going to listen to it? no. nobody is going to listen to this except the couple hundred people who have to who are just in the room this is just a joke. president biden is the least popular president in the history of approval polling for this day in his first term. there is nothing he can do to sell this. this is, the question is, how gracefully can he accept defeat? that is the only question. charles: i got to pivot to the markets because last year throughout, throughout the year you were pretty confident, you were very confident. you implored viewers to stay long, stay in this market. when many were quaking in their boots. we come out with a real strong start now. how are you feeling where we are now? >> well, it is too soon to take a victory lap but no question in my mind that we, bottomed in october.
the problem is, from the bottom in october 13th in the s&p 500 we're up something like 15, 16, 17%. once you've got that under your belt, much harder to get the next 15%. the time you want to buy, when everybody is terrified. that is when i was saying to buy them. people are not that terrified right now. fine, hold them, i'm bullish on stocks. that is not kind of opportunity four or five months ago last time we were talking about it. charles: don, always appreciate the conversations. thank you so much. >> same here, buddy. charles: president bide is attempting to sell the economy in state of the union tonight. what is the real state of the union for investors? callie cox will tell us at 2:50. meanwhile on twitter how would you rate your own state of the union. it is pre-rome. patty, gives it two stars. leo says it is perilous. folks keep the comments coming.
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dad, we got this. we got this. we got this. we got this. we got this. yay! we got this. we got this! life is for living. we got this! let's partner for all of it. edward jones ♪. charles: so yesterday the federal reserve release the its senior loan officer survey. got to tell you something, there was a huge jump in tightening of standards for commercial and industrial loans. you can see it right here, 44%, over 44% of senior loan officers, no they are going to tighten it.
typically this does not bode well for the economy. bring in morgan stanley senior vice president, financial advisors jim lacamp. tons of economic data, similar to this all moving in the wrong direction and all kind of suggesting that recession is inevitable. are you in that camp? >> the yield curve is really inverted right now and we never had a yield curve this inverted with short rates this much higher than long rates and not had a recession. leading economic indicate tores, plummeting. leading institute indicators plummeting. ism on manufacturing and consumer side, plummeting. consumer credit card usage, skyrocketing. i know the market looks a little better technically here. i agree with what mark said previously. we never had a bull market start with this series of economic data all pointing to recession and by the way, the fed is still raising rates. you talked about tight lending standards, the fed is also raising rates so the cost is going up. charles: i also know you're no
fan of the leadership right now of this market. a lot of people talking about these p-e ratios which have gone higher. >> right. charles: when we look at equal weight, sort of take out the overinfluence of these high beta names, particularly megacaps, forward p-e ratio is going up. isn't this digestible at this level? considering how, it has been significantly higher in the past. >> okay agreed but most bull markets start at 13, 14 times earnings. so on equal weighted basis we're sort of in the neighborhood but while not while the fed is still raising rates, not with inverted yield curve not actually entering into recession. when you're in a recession is when the market bottoms. here is why i could be wrong. we printed 40% more money in the u.s. money supply over a two-year period than we had in our entire country's history. charles: right. >> so there is a lot of money out there and we may have to rethink everything because of the ballooning of the money supply. charles: i said that so much,
just the typical business cycle that people went to school to learn about, feels like it is shattered. >> monopoly money. charles: intervening to be accommodative tore take money out. depends on swinging so quickly how can you have a ordinary business cycle? >> it is unprecedented. we never tried to reduce a balance sheet nine trillion dollars, we never printed this much money in our country as history. it will not end well. it is like a stephen king book, everybody getting killed in the end. charles: hopefully the rabid dog. one of the interesting things about earnings season, companies miss top, bottom line, given poor guidance, sometimes all three stocks go up. >> right. charles: this might be a reason why. mention of things getting weaker, worse, better versus worse is down significantly. things are not getting better. >> right. >> however mentions of optimism is skyrocketing. looks like if ceos can overlook this period, say okay, it is ugly right now, it will get a lot better down the road, stocks
are reacting to it, shouldn't investors pay attention to that? >> they should absolutely pay attention to it. and i think they should pay attention to the charts too. that's why you make these absolute calls sometimes you have to say i might be wrong, you might have to position partially instead of going all in on something but you're right, corporate executives are, first of all the earnings guidance has been better than anybody expected. charles: right. >> it is not good but it is not anywhere near as bad as what wall street thought. they're learning to adjust with more. i mean with less -- making more money with less employees. that is why their earnings are showing up a little better. charles: prime example would be zoom. zoom is one number one percentage gainer saying they lay off 1500 people. >> mention one thing, the bls numbers are not adding up with a private payroll numbers. so we may have a reckoning of these two things this year. charles: i have to bring you back. i don't know why the fed works off such faulty data. take one of the six unemployment
numbers it would not be u-3. i work off the u6. >> i'm with you. charles: been too long. my take away on the financial state of the union. first how are investors interpreting all of this? are they seeing opportunities? no one has a better look at the individual investor than callie cox. she is here next with the details. ♪. ♪ limu emu & doug ♪ hey, man. nice pace! clearly, you're a safe driver. you could save hundreds for safe driving with liberty mutual. they customize your car insurance so you only pay for what you need!
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♪. charles: all right, president biden tonight will give his version of state of the economy which i tell you will differ big time with what americans are telling pollsters but what about the state of investing? how are active investors interpreting the economy, more importantly opportunity? joining me etoro investment analyst callie cox. the market came out of the gate fast this year. i know you like folks that have restrained temperment for lack of a better word. you're always optimistic, but you know, even took you a little bit off-guard. are you okay now with what's happening, the way the market, you know, sort of consolidating
these gains? >> yeah. so i think you're right, charles. you want sentiment to be not too hot but not too cold. that cautious optimistic phrase every wall street strategist says and i think the pain trade is higher. i think there is still a lot of skepticism about the future but make up of the rally is more growth stocks fueled in a period of high rates that doesn't quite jive. charles: meantime i know you deal with a lot of retail investors. they have to feel pretty good. a lot owned these names. these names have done extraordinarily well. these names i believe they think will change their lives as opposed to ordinary portfolio returning 6% a year. on the other end of the spectrum, wall street, antipathy toward high beta names. where does that put the retail investor? >> well, i think both parties are right, charles. i think, it makes sense that wall street is a little more skeptical about these growth, high beta names.
again we're in a high rate environment. hiring environment investors focus on what's working now versus what could work later. but wall street is short-term by nature. they have benchmarks. they have shareholders to please. retail investors like you said are looking at what is changing the world around them. i think retail investors need to be cautious here. it doesn't surprise me they're bullish on technology, willing to pick up more familiar names at lower prices. charles: to that point, i know you see younger investors that 18 to 44 groupe more confident about their financial lives. that is sort goes against the narrative you read about the group. what is it when it comes to investing that is different from what you read in the mainstream media? >> i know, isn't that wild? so, charles, i think you mentioned this, we do quarterly surveys on retail investors, 10,000 retail investors around the world. what jumped out in the survey, younger investors are largely more confident in many areas of their financial lives, their
income, their job security, the global economy, the invests that speaks how this recovery has been a little lopsided but lop sided in a good way. i'll millenial and i'm biased the younger economy is strong foreyounger investors, gen-z. they benefited in the recovery, with buying houses with low mortgage rates years ago. they had student loans, they could have their student loans forgiven in the courts agree. i'm encouraged by this recovery. i think it is showing in young investor sentiment. i think that is something the fed needs to be attuned to when it decides on policy and where to go from here. charles: what about exogenous events? we had discussion what is happening between the u.s. and china. the global economy. china reopened. i'm not sure it had the economic impact people thought it would. maybe it still will. how should we look at those things? >> in regards to china i think that's a problem, right?
china is reopening, kind of like flipping a switch on but also not really. as we've seen with the american economy getting out of shutdowns is a multistep process. at the same time i'm worried about the second order effect we could see coming out of china's reopening t can be a positive for sure. we could see a growth boom but at the same time we could see a tick up in inflation, more of an argument to keep rates high. exogenous events are tough here. feels like one more straw could break the camel's back. for investors we're asking them to stay hedged, stay prepared for downside scenarios. charles: thank you so much, callie. always appreciate getting insight on that. coming up my takeaway on president biden's state of the union and his war on capitalism when we come back. td ameritrade, this is anna. hi anna, this position is all over the place, help! hey professor, subscriptions are down but that's only ..
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charles: ahead of the state of the union the white house released a fact sheet, the biden economic plan is working, president biden believed they built an economy from the bottom up, not the top down. you have heard this a lot. the middle class does well, when they do well the poor have a ladder up and still do well but here are the facts, the ladder of success runs through the middle class, through the upper class. from 1971, they moved to the upper class, we love them all to be moving up.
the goal is not month-to-month. the best way to grow the economy is create good paying jobs, and they create winners, certainly should be trying to destroy industry like the fossil fuel industry which has great paying jobs. only an attractive backdrop to hire investors, largest corporations being profitable and not paying taxes, and i didn't get a chance to finish it but went through 10 of them and counted 400,000 jobs which i will extrapolate that to believe these 55 companies hire millions of americans. if you want to go to war with them they have to lay these folks off. zoom announced a major layoff, stock is through the roof. halt the war on capitalism, that is all i have got to say. liz: almost like fed day
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