Thursday Mar. 20, 2025 - Fair trade vs. unfair trade
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He's been seen on CNBC, the Fox News Channel, and the Fox Business Channel. His articles can be found on MarketWatch, Seeking Alpha, TheStreet.com, and many other places. He's the author of the weekly Best Stocks Now newsletter and the inventor of the Best Stocks Now app. He's president of Gundersen Capital Management. Here is professional money manager, Bill Gundersen.

And welcome to the Thursday. It's the Thursday, March 20th, post-Fed decision edition of the Best Stocks Now show. And hey, look at that. I predicted this morning the markets were down quite a bit with the futures, and then we opened up just slightly down.

And in the message I sent out to clients and subscribers, I said I would not be surprised to see some bargain hunting in the markets today. And that's what we're seeing. This is Bill Gunderson, president of Gunderson Capital Management. This is the Best Stocks Now show. The NASDAQ is now up. How about that? The NASDAQ, can it make it three days in a row? Or I guess three out of four or something like that. The NASDAQ's up 49.57 right now. We're gaining some steam there.

The NASDAQ is up 57 to 17,805. The Dow is up 51. That's 12 basis points to 42,015. The S&P is up about 10 points right now to 5684. Small caps down 10 points. They continue to be a big laggard as far as an asset class goes here in 2025.

We have interest rates, get this, they're 4.19 this morning. 4.19, that's the lowest they've been in a long time. Whatever Besson is doing, it's working and driving down interest rates without the help of the Fed. And we've got gold at 3,041. And last but not least, Bitcoin is up 1,500. So a little risk on here today at 85.830.

So welcome to today's Best Stocks Now show with professional money manager Bill Gunderson, president of Gunderson Capital Management. I'm here with Barry Kite, our chartered financial analyst. And it's looking more and more to me, Barry, that the commentary I wrote in last Friday's newsletter that I think maybe a bottom is in here in the NASDAQ. That's looking like a pretty good call today.

So far, after a bear market territory sell-off for a lot of the AI and high-paying stocks, the Mag7, Tesla, holy cow, Palantir,

But they've all stabilized, and they're going sideways. Palantir put a bear market in in a day and a half. Yeah. Will it put a Super Bowl in in like two weeks or three weeks? Like astronomical to the moon, fly me to the moon type of move.

And, you know, that had to cool off a little bit. Looks like the latest, chart looks like the latest fare ride. Yes, and it did. They got a new ride up there at, what's the one on the border up here in South Carolina, North Carolina? Oh, yeah, yeah, yeah. Wins, something wins. Not Dollywood. Carowinds. Carowinds. Yeah, Carowinds.

They've got a new write-up there. It's called the Palantir Dipper. It shoots straight up and then comes straight down. But in the end, you're still higher than where you started. That's not bad. So anyways, we've got a little bit going on. We've got the Fed behind us. I don't think the Fed said anything to upset the market.

And, in fact, when they mentioned two rate hikes, I could hear the market getting all excited, you know. Wow. I mean, rate cuts. Sorry about that. Rate cuts this year. That's what the dot plot shows. And, you know, the markets, the Dow was up 383 yesterday. The NASDAQ was up 247. Pretty good day. The Fed held rates steady yesterday.

Indicated two rate cuts. Gold hit a new all-time high, 3,056. That's another record high. Shopify, for me, was the stock of the day, up 8%. I don't really know what the news was. Other than they were switching their listing from the New York Stock Exchange to the NASDAQ, I guess the market liked that. So anyways, the Fed held steady on rates. They see slower growth and higher inflation today.

But they also see that inflation as transitory, and it may not happen. It depends on where the tariff wars end up. I listened to an interview yesterday. Barry, you should listen to that. That's very interesting. It was Robert Lighthizer. He was in charge of trade under Trump for the first Trump administration, and he's still very much involved now.

I think, as an advisor and a consultant. And he talked in depth about trade deficits, the huge trade deficits. And, you know, he was talking about how trade was never meant to create huge trade deficits like that. Both countries were supposed to benefit in a trade agreement. And this is an interview he had, very interesting, with Tucker Carlson.

And it was about an hour interview. A lot of it, a little of it kind of went over my head. I think it even went over Tucker Carlson's head. But he talked about how trade deficits create tremendous transfers of wealth out of America to other countries. And I guess from a logical point of view, that makes sense. Who's benefited more from our trade deals with China? We've gotten cheaper products now.

But our GDP is 2% these days, and much of that is caused by the massive trade deficits, which were never supposed to happen under fair trade deals. So if you really want to understand the trade deficit issue and why Trump is resorting to these tariffs, that's a very good interview. I highly recommend it with Tucker Carlson and Robert Lighthizer.

Well, and industry protectionism, too, is another big piece in terms of one country subsidizing a particular industry. Take Chinese steel at one point in time, right, and then making it much cheaper and then dumping it onto the world market, not just ours. Yeah.

but at a much cheaper rate. That's cheating in trade deals, right? When you dump cheap products on a market, that's a no-no. So anyways, I mean, it was very good, and it enlightened me a lot on how the trade works and the trade deals and what the consequences are and all this and that.

The Fed also set their PCE inflation at 2.7, which was revised up from 2.5 in the December estimate.

But it's not expected to stay elevated. He thinks that's transitory. And they also put the growth rate GDP at, they bumped it up a little to 1.8%. And, you know, a lot of that is the trade deficit that holds our growth down. So anyways, we had a pretty strong day. I would just say that the Fed was fairly dovish today.

And, you know, indicating two rate cuts, I think, was very important for him to mention. I'll tell you what's interesting is, of course, you know, the Fed mentions, right, two rate cuts. Of course, you know, you look at the market and percentage-wise, right, there's really, you know, there's basically 49% of the market is, you know, agrees that there will be two rate cuts, which is a lot.

which means the other 51 think there's going to be more cuts. More cuts or less cuts? More cuts. I'm on the more cuts side now. Yeah, you've got 33%. 33% of bets are on the three cut for the year. So it tells you where the money is even versus what the Fed is saying. Yeah, well, he has to jawbone the different things that...

He doesn't want the market to get expecting three and then only get two.

And, of course, it's not good enough for Trump. He's calling on the Fed to cut rates as tariffs start to ease into the economy. He thinks they should. I've never met a president yet who didn't think that the Fed should be cutting rates. Always want to fuel that economy, right? Yes. And so, anyways, on April 2nd, Trump will unveil his new reciprocal tariffs on various countries based on the rates they charge for American goods.

which only seems fair, just illogical. I just look at things from a logical point of view. The scope of the new tariffs remains unclear. I know India's been coming down on their tariffs. They're one of the worst. They're 100% on U.S. cars, and that's where you get into protectionism. They're protecting their big auto industry. Tata Motors is a major player there.

in the world. And, you know, they have 100% tariff on U.S. cars. The Bank of England is probably pretty much in cahoots with our Fed. They hold great steady. They're at 4.5%.

I think that's where we are, although the 10-year is down to 4.19. And it should be noted that the 10-year is down 60 basis points since Trump's inauguration on January 20th.

And that was one of their things they wanted to accomplish was drive down interest rates. Well, that drives down budget costs. Yeah, that drives down budget costs, right? I mean, what do you think is going to save more money, right? Reducing a headcount by 30,000 people or reducing interest rates by 0.6% when you're debt? Yeah, a trillion dollars in interest, right? That's part of the deficit.

So maybe they've lowered that to $800 million in interest rather than a trillion. So, yes, it helps your budget. They're trying to balance that budget. We'll be right back. ♪♪♪

And welcome back here to the second quarter of today's Best Stocks Now show. Well, the market has improved quite a bit. I was just looking. I just downloaded my B-plus or better rank stocks out of my Best Stocks Now app.

which has 5,200 stocks in it. To become a B-plus ranked stock or better, they have to have a valuation, a good valuation, and good momentum. Those two in place are

There's also a little bit of quality built into that algorithm that I use. And we have today 384 B-plus ranked stocks. Eight days ago, we had only 208, which is very low. That means the market's pretty washed out and oversold when we reach that level.

384 is back to pretty much a kind of a normal, maybe a little bit below normal number. When you get up around 700, 800, 900 B-plus or better ranked stocks, the market's a little bit overheated. So we're at a good number there as far as B-plus or better ranked stocks. Copper prices top $10,000 a ton.

And I was looking at the ETF copper, CPER, and that's gone on quite a run, 6, 24, it's up 25% copper since the beginning of the year. So Trump has certainly driven up copper prices.

Big time. I got a copper bar that I use as a paperweight. I think it's the first year that they actually, I guess, I don't know, minted copper, but it's in 2012. It's like just a

one kilo bar so well you listed on ebay worth a little more than it was yeah divide 10 000 how many ounces are in a ton i can't do that in my head it's a kilo so it's a fantastic paperweight i'll bet where can i get one i'm not i'm gonna think i'll get a mine is going to be gold you know sitting there on the desk right that pretty from fort knox copper prices just 10 000

By the way, I'm having a ton of copper dumped in your driveway today. Okay, so anyways, it's going up along with the gold prices. What can I say? Gold hits a new all-time high, so they usually run together. Trump to sign executive order directing the Department of Education shut down. And, of course, we're hearing that he's doing away with Education America. I think he's sending it back to the states is the whole idea of that. So...

You know, this was an interesting story. Greenpeace, I used to see a Greenpeace ship in the San Diego Harbor from time to time. They have to pay hundreds of millions of dollars to Energy Transfer, which is a Canadian oil company, in the Dakota Access case. I mean, that would basically break Greenpeace. They're out of business. I don't think they even have $600 million in

unless they're getting money funneled to them through NGOs and whatnot. But that's a huge award against them, a verdict against them behind their protest and all of the vandalism, the violence that they caused in that Bismarck area. Anyways, that's an interesting development there.

Oklo announces a milestone on a path to deploy the first commercial powerhouse in Idaho. Now, we've been talking about this, and of course, the proving grounds up there near Arco. I've been there. I have distant relatives that actually work there.

They reached a milestone agreement with the Idaho National Laboratory, the Department of Energy's largest multi-program science and technology research lab, and is prepared to lay the foundation of its first commercial nuclear power plant. Now, they're the ones that are going to build the smaller nuclear power plants. The agreement reached in collaboration with the Department of Energy and local Shoshone-Bannock tribes,

that's one of the tribes there, in Idaho, aims to ensure that Oklo follows environmental regulations throughout the site investigation process for the future location of its Aurora Nuclear Powerhouse. So that is a big hurdle. Getting past that, I mean, to get the permits to start and lay the foundation for

Oklo has been focusing on his timeline to get nuclear reactors on the ground, targeting first deployment by 2027. And they've reached deals with a lot of partners, including data center operator Switch and fuel developer Lightbridge, who's coming up with a more efficient fuel, form of the fuel. LTBR is the symbol there.

In a Barron's interview, Oklo CEO Jacob DeWitt said the latest development was both a sign of how far the company has come and how far it still has to go. Okay, so that's the issue there with nuclear is that how far it still has to go. But they have a reason.

I mean, that's why we haven't had – I mean, that's the biggest hurdle a lot of times. I mean, remember we had the one here. I guess me and you probably moved after they had already – moved here after they had already started it, and it was a debacle. Years. They ran it. They put so much money into it, and then they – I think –

Yeah, and then they ran into, like, an environmental issue way after the fact of building. Way after, way into it, which basically shut it down, and they finally walked away from it. And now they're starting it back up again, now that there's a friendlier administration out there, I guess, and...

That was out there at the Santee River, the Cooper, Santee Cooper nuclear power plant. But they were like a billion, they were a billion dollars or more into that project, I believe. Several billion, yeah, and had to walk away from it. People's Bank of China?

Keeps lending rates unchanged. Now, they're clear down at 3.6%. No, 3.1%. We're at 4.5%. So, you know, money does follow cheaper. That's one of the reasons why China's up 21% today or year to date. And the U.S. is basically down a little or flat. I think it's still down in negative territory.

Money chases cheap money, cheap lending rates, and that's why you've seen Japan's markets doing better this year. And China is the market of the year, up 21%. They have the lowest interest rates, 3.1%.

Let's see what else we got going on here. Bank of England, Bank of China, EU is planning their counter tariffs. They say Trump's tariffs are unjustified. They say we're not the problem.

Well, the EU is pretty harsh with their tariffs against our goods. I don't think that's true that they're not the problem. The EU said it's going to raise its levies up to 26 billion euros worth of U.S. goods including boats, bourbon, and motorbikes.

That sounds like a Saturday for you, Barry. Boats, bourbon, and motorbikes from April 1st. I don't know if bourbon and boats and motorbikes go together. That's probably not a good combination. Your Saturday fun is going up in price. We'll be right back. You can't turn him into a home. And the boys upstairs just don't understand anymore.

This is Bill Gunderson. Thank you for tuning in to today's Best Stocks Now, Best Inverse Funds Now show. I put several hours of research in during the wee hours of the morning each day to bring you the very best cutting edge stories that I can.

To get two free weeks of my newsletter, go to GuntersonCapital.com. To talk to us about our fee-based only money management services, call us at 855-611-BEST. Now, back to the second half of the show. The Instigator Because there's something in the air

We've got to get together sooner or later.

NVIDIA had about a 25% correction from the high. It was somewhere in that range, 21% to 25%. And that's where most of your AI stocks, most of your top 10 S&P 500 stocks were down anywhere from 20% to 25%. Netflix was down 21% from its high range.

Nvidia somewhere in that range. Even Meta after going on that long streak. Meta. The longest win streak since like 1990. And then, of course, what gave up 17%, 18% at least. Yes. And while the S&P was only about a 10% or 11% correction, the high beta stocks, the growth stocks, it was more like 20% to 21%.

NVIDIA today, that looks good. It's back up to 119. It is up $1.50 today. There's more news out on NVIDIA today. They're in the spotlight as Morgan Stanley is more positive after their GTC analyst question and answer Q&A.

He said he was more positive. This is Morgan Stanley's analyst that covers it. On the tech giant's trajectory after it held an analyst question and answer session at its GTC event, Morgan Stanley analyst Joseph Moore said management's enthusiasm at this stage of the blackwell was notable given that it comes at a time when the market appears to be losing confidence in

NVIDIA CEO Jensen Wang said during the keynote address that the four major cloud service providers, Amazon Web Services, Azure, Google Cloud, and Oracle Cloud, have already purchased 3.6 million. Oh, man, Blackwell GPUs in 2025. We're not even three months into the year, Barry.

Yeah, I mean, he said it was also... Starting off on a high note, right? Yes, he said it was also clear that the reason the company made the decision to give that day was to refocus the narrative on the strength of the demand that is out there for these chips. And they also gave a very solid timeline and calendar for future products, right?

$162 is the target price for NVIDIA from Morgan Stanley. The stock's currently at $119. I think it's a pretty good bargain myself. NVIDIA management also made a compelling case on how to solve the problem of growing inferencing at scale.

And while the market is skittish over efficiencies, it should drive demand higher, especially as application-specific integrated circuits start to encroach on NVIDIA's business. Well, cheaper products. But I think NVIDIA's chips are going to be needed. NVIDIA is going to invest hundreds of billions of dollars in U.S.-made chips and electronics.

Okay, that ought to be music to President Trump's ears and get Jensen Wang in good graces with the administration. Well, when you know they would love to diversify their supply chain in terms of geographically if they could, the problem is not that many people make those chips. No, they have a very limited, but Micron would be one example.

obviously that would benefit. They're also in talks with Intel, maybe for some chips. Intel, you know, the jury's still out there on Intel with the new CEOs. It's probably down in that value turnaround type of camp if you're looking to invest in Intel. Also, this humanoid robot revolution campaign,

He's calling it the next, you know, look, I saw the computer revolution from the mainframe IBM computers to the personal PCs, personal computers, then the networking of those computers, then along came the phone revolution.

Where the old dial-up phone on the wall. When's the last time you saw a phone booth, Barry? I mean, there's some of these old, I see these model railroad guys. I see what everyone wants to have at a hotel. Yeah. At a hotel, like way in the back by the lobby bathroom or something, right? So he says the next revolution is humanoid robots. You're going to have to have one at some point, and that's that group that we were talking about.

Whether it can vacuum the floor. I don't know. I mean, we already have. We've had an iRobot for a long time. It doesn't bring me dinner yet or make my bed. And it doesn't drive you around. No. It doesn't drive you around yet either. Yeah, I need a twin, you know, to drive the car around and take me out to dinner and whatnot. So anyways, the biggest player in that is obviously Tesla with their Optimus.

Elon Musk has called that the biggest product in history. Of course, he's known for a little hyperbole. And then Microsoft has their own robot. And guess what? They're going to need NVIDIA chips. So the humanoid robot revolution is upon us.

says NVIDIA CEO Jensen Wang. Okay, Quantum has picked up. I've seen some lively trading in Rigetti. I've seen some lively trading in D-Wave. D-Wave seems to be the main stock in that. But there's a new tie-up here between IonQ, I-O-N-Q, which has been a player at times.

With ANSYS, it came up during Wang's presentation as a supplier to NVIDIA. So they're teaming up with IONQ. We'll keep our eye on those quantum stocks. Eli Lilly launches weight loss drug in India.

beating Novo Nordisk to the punch. I'm starting to see some advertising, too. They're getting a little bit more aggressive in their advertising. Lilly is starting to perk up again. Man, it really went through a tough time there. It got up to 935, and then it went down below 800.

Well, you know they're ramping up supply behind the scenes. They're ramping up supply as much as they can, and at some point the drug will be cheaper, but they're going to be selling more of it. Well, I've also heard from several sources that,

Different suppliers know more of the compounding. They've sent out letters and notified the patients and clients that no longer can we sell you the compound knockoffs of semaglutide and terzepatide.

So that's something where HIMS has a certain amount of time, I guess, to go through their inventory. There's some kind of ruling that I saw in terms of what their business and how that will be wound down. Believe it or not, I would count Lilly. In fact, it's in my value portfolio. You know, value...

Strict value investing, the Graham and Dodd method, it's not relative value. It's intrinsic value, right, where you go into book value and the sum of the parts. I approach it from a different angle. I look for relative value, which in my opinion is equally as powerful as relative strength, okay?

Relative strength means how strong is it relative to the other stocks in the market.

That's a definition of momentum or a technical indicator. And I think there's such a thing as relative value when you had a stock that was at one time. NVIDIA would be a good example. NVIDIA was trading at much higher multiples. Now, a strict adherent of value investing is going to turn my show off right now by saying what I'm saying. But I believe strongly...

You know what? There's a name for that concept. It's called Fallen Angels. Those are Fallen Angels stocks. Those are stocks that were trading at very high multiples at one time. And you can look at them today and say, well, you know, Lilly still got a pretty high multiple there, Gunderson, at 27 times forward earnings. Yes, but it was trading at 45 times forward earnings not too long ago.

I think relative value, I've always been a little bit of a maverick going against the grain, and I think relative value is equally as potent as intrinsic value, which when you get into intrinsic value, I mean, you're looking at an auto part maker, right? If they just sold off their machinery. They're selling plant names.

Selling plant and equipment. Or cash in the bank. Compare Intel and NVIDIA and tell me about the relative value, right? Exactly. That's the key. Okay. Well, on that note, we'll be right back. We've got some Tesla news. Tesla's a relative value. Perfect example. We'll be right back. You gotta go.

And welcome back to the final segment of today's Best Stocks Now show. And speaking of that relative value portfolio, that's going to begin on March 31st at the close there. And I've already got most of the portfolio lined up, and I'll be investing in it.

as the guinea pig, as the seed. It's not pooled money. Every account is separate. And, you know, I mean, I buy these stocks for you. If you say, okay, I want in, open an account for me. Here's $200,000 or whatever. I buy when I think the time is right. I don't put it into all 30. I'm planning on more in the 25 to 30 range stocks.

Because there's a lot that meet this criteria. It's harder to find those B-plus value and momentum stocks, but the value plays, the fallen angels, sometimes they're all over the place, especially right now. This is a very good time to be investing in something like that.

I'm not saying Tesla is one of them, but Tesla would definitely be one under heavy consideration. Tesla was $488 just three months ago, and it's now at $236. So its valuation has come down about 55%, 60%. We're talking about price to sales, price to book value, price to earnings, price to cash flow, etc. And I'm seeing Tesla...

attempting a bottom here, Barry. One, two, three, four, five, six, seven, eight, nine days now of building a bottom. I still have room for about 10 more stocks in that portfolio. Tesla would definitely be under consideration as an example of

what I consider to be a fallen agent. Now, Tesla's still got some problems. They're recalling thousands of Cybertrucks over an exterior panel issue. Actually, yeah, all of them. All of them. To fix this one issue, I think it's an issue that's only going to end up affecting less than 1%, but they've got to get them all in there, and at some point...

glue, adhesive, or something of that nature. I'm glad that didn't happen on the SpaceX rocket that brought the astronauts. So he's had a good week. They need to use some of that adhesive. That's the adhesive they need to use. Yeah, and he's had kind of a bad week with this problem with the cyber trucks.

Now, Wedbush says they have an outperform rating on Tesla and a $555 target price. Although the firm thinks Elon needs to make a few moves to flip the narrative. Boy, I don't know. I mean, the sentiment against him and the lighting cars on fire in California, man.

Yeah, I mean, he's in a can't-win situation in reality. He's in a tough situation unless the conservatives come to the rescue and start. To me, the biggest thing that could happen for the EV industry in America would be getting our hands or the technology or developing our own on that five-minute charger.

That would be a game changer. If you could charge your car 250 mile range in five minutes...

That, to me, is a game changer. Analyst Dan always thinks... Well, and NVIDIA teaming up with GM. I mean, that's a big deal in terms of you've got to have those chips and you've got to pull less power to make... Self-driving uses a lot of technology and power, so... Yeah, well, that 30 minutes sitting there waiting for your car to charge, that just doesn't work in today's world.

My wife went and saw, you know, our daughter and husband and family. They're in Columbia, South Carolina at Fort Jackson. He's an officer there. And so that's what. It's two hours to Columbia, a little over two hours. And she drove her Mercedes EV home.

By the time she got there, it was 50%. She'd used 50% of her batteries because she's running her heater. I said, you've got to be careful. A heater eats a lot of electricity. But she said it was cold. Okay. But we also have a trickle charger that she plugged in over at her daughter's house there.

And that gave her like another 10%. But that's slow. But she was there for several hours and was able to get home okay. So that would be a game changer in my opinion. But it's stuff you're worried about the whole time. Yes, but they think that he needs to be a little bit more, needs to say a few things. I'm sure he listens to what Wedbush has to say, Dan Ives.

He says they need to give out a roadmap for a cheaper, lower-cost vehicle to be released in the market in 2025, along with an update on their unsupervised rollout in Austin, Texas. And also, you know, the Doge issue, that's the one that's hurting him the most,

They think that they need to see Musk take a step back and balance his Doge and Tesla CEO roles. But I don't know. I mean, once that toothpaste comes out of the tube, it's hard to put back in. I don't think the sentiment is ever going to really shift back to being favorable towards Elon from a certain, you know, half the society, half of our society, right?

He doesn't like the guy, and they're lighting cars on fire. They're flipping off people, driving Teslas for supporting him. It used to be the other way around. You know, it was his following was the environment. Yeah, California loved Tesla all the time.

Okay, Darden Restaurants, we have one earnings report of note. Darden, which a lot of people frequent, popular Olive Garden and all their different brands that they have. Hey, that's a good report. It's up 7.1%. I know that they did a deal with DoorDash that has helped them a lot.

Their sales were up 6%, earnings up 7%. Not a bad deal. It's closing in on an all-time high over at Darden Restaurants. D-R-I, Lone Star, or not Lone Star, Longhorn. One of those steakhouses, Lone Star. I can't remember. We have one in Mount Pleasant.

And Bahama Breeze and Olive Garden and all the different brands that they have. Oh, yeah, Darden. Yep, Darden. Okay, well, that's another show. I think there's some bargains out there right now. There's no question about that. If you'd like more information on the value fund, it's up and running now, but it will officially be in the newsletter and we'll start it at $100,000 on Friday.

on 1-331-25, and just on money management in general or a financial plan or become a free trial user of everything at GundersenCapital.com or 855-611-BEST. Have a great day, everybody.

This show is not a solicitation to buy or sell any securities. Bill Gunderson or clients of Gunderson Capital Management may have long or short positions in stocks mentioned during the show. Past performance is not indicative of future performance. Gunderson Capital Management is a fee-based registered investment advisory firm. All accounts are held at Charles Schwab. Schwab is a member of SIPC and FINRA.