Clear Eyes, Fully Vested, Can't Lose?
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All right, welcome to the On The Tape Podcast. I'm Dan Nathan, joined by Guy Adami in a frosty, frosty New York City. You know, something frosty, that's a great word. Never used really in the way that it was intended to be, but it is frosty.

It's frosty out there. I saw the thermometer this morning when I heated my son's car minus five degrees. That, of course, is Fahrenheit, not Celsius. Yeah. Well, there you go. How do you spell Fahrenheit? Nobody knows. I do know that. We'll put that in the show notes. Don't worry about it. We got a lot to do here, Guy. Last night, as we were on the CNBC's Fast Money, there was a

Donald Trump had Larry Ellison. He had Masa, son of SoftBank. He had Sam Altman from OpenAI. They launched some big initiative. They're calling it Stargate. You and I are going to dig into that. He also had some thoughts on TikTok.

and how that might be sold to a U.S. holder, conglomerate, whatever you want to call it. We're going to review Netflix earnings. The stock is raging to new all-time highs after its earnings last night. And then obviously a little bit of some of these executive orders as it relates to tariffs, the

border, energy policy and the like. And lastly, we'll touch on Jamie Dimon, CEO of JP Morgan from Davos. He's weighing in on stock market valuations. And lastly, we're gonna take a user question. It's not gonna be directly from a user, but it's a concept we think will be useful to our listeners, to our readers.

You had to sit there during Fast Money and listen to this press conference. Again, we just laid out who was there, what the initiative is, what the name is. What were your takeaways here? Because the idea is that they're pledging a half a trillion dollars to build out AI infrastructure here in the United States of America. Listen, obviously the market's taking it

as a positive on the margins. But, you know, a lot of this, and when I say a lot of it, I think a lot of it's 65, 70% of it. I think we've sort of already known that there's going to be CapEx in the space

for the foreseeable future. So in large part, this to me is just sort of a reiteration of a lot of the things that we've known already, but it was packaged in such a way to make it sound like it was something new and exciting, which is fine. I mean, the packaging about things and messaging is a very important part of this, but the market, in my opinion, can only rally on the same news a finite amount of times. And to a certain extent, the excitement we're seeing in some of these names and the tangential names

are rallying on things, in my opinion, that's already been sort of a known. Yeah. So I think that's a great point. And we'll hit some of those adjacent names because there is a lot of like positive price action right now and some stocks that have kind of been stuck in the mud a little bit. I think to your point about what's already been known, we know that Masa's son of SoftBank had already come to Mar-a-Lago in the last month and suggested that he was going to spend or his company was going to spend $100 billion on AI infrastructure in the U.S. by the end of Trump's term.

Larry Ellison, Oracle, this is a company that would love to take some market share from the cloud infrastructure players. The stock had not been acting particularly well over the last couple months since their latest earnings, also pledging $100 billion. And then OpenAI, this is a company that already was spending tens of billions and was going to commit to spending hundreds of billions over the next decade.

you know, decade or so. This is a company guy, you remember, said last year at some point that they will spend trillions of dollars. You know what I mean? So to me, I don't think this announcement offers a whole heck of a lot of upside because, again, these companies, this was their plan anyway. If it doesn't materialize because, let's say, you get to a point where there's an overbuild, there's an overbuild of infrastructure, some of these companies are going to have to start looking

away from the U.S. And we talked about this last night with Dan Ives of Wedbush, and I asked the question, at some point, the U.S. grid, the power grid, is not going to be able to support some of these plans in the near term. Which was one of the right things to bring up with that question. That's also one of the reasons you're seeing

Stocks in that universe rally over the last nine, 12 months the way they have. And we've sort of outlined those names. And quite frankly, there's probably still an underlying bid to that. But, you know, to your point, it's interesting. You know, you get sort of accused on the front page of The Wall Street Journal and you get acquitted on page six.

below the fold type of thing. I don't even mention that because if you remember Foxconn many years ago and that investment they were going to make in Wisconsin, obviously that news was front and center, you know, but the subsequent sort of fading away was never really covered. And so to your point, I think, you know, these things are exciting.

when they're announced, but they sort of fade into the ether over a period of time, and they're never really exciting as they were intended to be. But you know what? I don't even know if that's the point at this stage of the game. I think it's the enthusiasm that is really capturing the imaginations of people. Yeah, I think that's a great point about A1 versus A6. And what's changed now is Twitter. And I mean that sincerely because this was all playing out

on Musk's Twitter, right? And probably Trump's, you know, social or two-throat social or whatever. But, you know, what does Musk have to say about this deal? You know, he's building XAI. They've been buyers of, you know, if not

tens of billions, they will commit to buying hundreds of billions of chips and build out of infrastructure and the like. And he and Sam Altman are at major odds with each other. The companies OpenAI and XAI are competing for a whole host of things. And when you think about Musk's relationship and proximity to Trump, at some point,

this is gonna go bad, this sort of relationship, you know what I mean? 'Cause he will start tweeting about this. And so who knows here, like how this thing plays out. I wanna get your take though on some of the names that are moving. So last night as they're announcing this deal, and again, I think you and I, it's very clear from this last five minutes, we're a bit skeptical and I'm looking at Nvidia in the aftermarket, it was up 1%, now it's up 4%.

We were looking at Dell in the aftermarket. It was up 2%. Now it's up 7%. We are recording this right after the opening on Wednesday morning. And then there were other names. Oracle was only up a couple percent. Now it's up six and a half, 7%. And then there's names like Seagate and Western Digital. And these companies make disk drives and memory that go into the servers, that go into the data centers. Seagate is up a lot, about 8% on its own earnings, better than expected margins. Western Digital is on its way up with it.

So let's talk about, oh, and I can't forget, Arm Holdings is up 15% or so. This is a company that SoftBank owns 88% of. So there's a lot of movement, you know, 12 hours after this was announced. Thoughts on some of these names and the way they're moving? And then again, are these the most vulnerable if it comes out that people are not that geeked up about this announcement? It's going to take years for it to materialize.

It's amazing. I mean, the money flows into these names and you just sort of outlined five or six of them. And there are obviously some more. It's interesting. And I think it's just the absence of selling and money trying to find levels where, you know, this type of investment dollars can find the natural seller. I mean, I think that's what we're dealing with here. But I think you bring up a good point. I mean, the exuberance around this.

at some point it's going to wear off we say it all the time you know valuations do matter in the case of some of these stocks for example dell is one that you mentioned i mean this was a stock that if you go back in time made its all-time high of about 180 something i think it was 180 on the screws back in may of last year you had a pretty significant decline subsequent bounce

But the levels that we just traded down to suggested that, hey, anything on the margins on the good news is going to get this stock to move. It's not like it's trading at these levels at a current, at a past all-time high. We're significantly lower. So a lot of it is just sort of set up in timing as well.

I am, as you are, skeptical in terms of what it means to these companies and the lifespan of when it actually starts to kick in, like the timeline of this entire thing. But for today, at least...

you know the market is obviously excited about it yeah and i think it's important to keep an eye on some of these names that where the gaps were and where they are trading in the afternoon because oracle has already given back a few percent from its highs dell has done the same thing and then last thing i'll just say when you see this sort of news it's always interesting to see obviously what we just described what's going up on the back of it but then on the other side of it what is not going up on the

back of it mike ron is one of those names that's read on the day so um again we'll keep a close eye on this the other thing that came out of this press conference guy where trump started taking questions is obviously uh the situation with tick tock the supreme court upheld the ban trump signed an executive order to give them 75 days to remedy the situation he's obviously being very clear that he wants uh tick tock to be sold to a u.s company larry ellison was there

Larry Ellison was meant to be one of the bidders back in 17 or 18 when Trump initially said that. He said, well, I'd be open to, you know, Oracle buying it or Larry Ellison. He also said Elon Musk. And, you know, the thing that I find interesting is that this is not going to be an easy thing to lap.

up for some U.S. company, it's got to be worth over $100 billion. Trump threw out some, he's like, I want to do a deal. I want to negotiate a deal. I'm good at negotiating. And then he said, this thing could be worth a trillion dollars. If you are a good negotiator, you want to talk the valuation down, not up. That's how you get a deal done. So thoughts there, because I'm really skeptical that there's any real deal to be done with one buyer.

I, it, again, it's, it's great theater around TikTok and, you know, the, the binary notion that without a deal, it's worth zero. And with the United States involved, it's somehow worth a trillion dollars. And, you know, obviously I think, you know, there's that chasm is probably exaggerated for lack of a better word, but to your point, like, I don't think it's just that simple. You wave a magic wand and the deal gets done. And by the way,

you know, there's a, there's the algorithm associated with Tik TOK that makes it valuable that I don't necessarily know if that's going to be part of the deal. If it were in fact were to happen here in the United States, there's so many moving parts here. And now you also have to have a willing seller on the other end. And you,

you know, if you listen to now President Trump, he makes it sound like, you know, it's pretty binary. If you don't sell it, you got nothing. And if you do sell it, you're in a joint venture with the United States and you've just basically, you know, created value where there was none. I just don't think it's that easy, Dan. Yeah. You know, and at the end of the day, also, we've been talking about over the last couple of weeks how a lot of these big tech CEOs have been jockeying to curry favor with Trump, especially when you consider just the

the proximity again of Elon Musk to Trump. And you think about Microsoft and Google and Amazon and open AI. I mean, the list, you know, uh,

goes on and on, Meta, obviously. They all have competing interests as it relates to TikTok, as it relates to, again, policy on AI and the like. And so there will be winners and losers, and Trump loves picking winners and losers. So here we are just two days into the administration. And real quick, and it's not politics. I was watching Stephen Colbert the other night because I find him amusing, and the Pod Save America guys were on.

and TikTok came up, and one of the comments that I thought was just spot on was,

The ban around TikTok was because it was, yes, potentially a spying device used by an adversary, but more so there was really just the dumbing down of America. And I think that was part of it. And if you think about it, it's okay for us to dumb down our population, but it's not okay for the Chinese. And that's one of the things that came out as well. I mean, if TikTok...

is adversely affecting our population shouldn't matter who owns it dan but that's i guess neither here nor there yeah i mean okay and you know meta reels uh instagram yeah no look i'm the same yeah yeah i'm no i'm agreeing with you i mean and i agree um with that point and so you know i mean i'd love for tick tock to be banned because i have a teenager i'm 19 year old and a 21 year old the 19 year old spends a lot of time on it and they

There is addiction here, you know, and a lot of people have been very upset about some of these, you know, warnings that are put on alcohol and the like here may cause cancer. We don't know what this is causing, but there's no doubt about it. It's kind of melting the brains of many folks and not just teenagers.

Also on Fast Money last night, Netflix quarter and guidance was coming out at the time. I don't think you could find a single person, including us on the desk, who would not have agreed that this was a great quarter. They added 19 million subs. Half of those subs are coming from their ad-supported tiers. They're raising prices. We talked about last night the password-sharing thing that they've done a really good job of. This is all margin.

Okay, like it's literally just dropping to the bottom line. This company is operating at a level better than any time we can remember, you know, in the last 20 years or so. So what do you do with a stock like this guy that gaps to an all time high? It was trading above 1000. Here it is right now at 981. What was the prior high was like 941. The stock had sold off a little bit into the print yesterday in the market call.

you thought they were going to have a good quarter. You thought the sell-off was something you wanted to buy in the quarter. What do you do now with it? And then for the balance of 25, what will be the sticking points? You know what I mean? What will be the thing that you're going to look back and say, this was as good as it gets? It's interesting. Okay, so here we are now. So to your point, what do you do with it now that it's making a new all-time high? I think $999.

by the way, was the high that we saw earlier today. And it's going to be a big volume day. Now, you mentioned that prior high. I mean, I said this on Fast Money. I'll say it again. It would make sense for us to revisit

the prior high of about 940 or so that we saw in early December. That makes sense. So if you're looking for a level, if you've missed it, that's level number one. I think if you've enjoyed this run, given the amount of volume the stock's going to trade today, I think it's incumbent upon you to do something. What that something is, is either sell upside calls, sell a quarter of your position, a third of your position, half a position, and give yourself some optionality. Because I think to sort of...

remain in place is foolish. However, if you think this is, which is now a $400 billion company, if your view is at some point, this is going to be sort of one of the next trillion dollar companies and you don't need to do anything. By the way, I don't share that view. And if it does in fact happen, it's not going to be a straight line. So

I think to answer the second part of your question, in terms of as good as it gets, you're not going to see that kind of sub-growth for the foreseeable future. I think this was a quarter that made sense in terms of some of the offerings that they had.

and some of that sub growth but i don't think you can see that the same type of magnitude and you know margins which by definition will improve if they raise prices you know that's going to be something that i think starts to moderate as well so it's not necessarily as good as it gets for the for the

lifespan of the company, but I think it's as good as it gets for the foreseeable future. Yeah, they're just operating on a different scale. We know some of the problems that a lot of these other streaming offerings from Warner and Comcast and NBC Universal and, you know, Hulu and some of the other ones are just not doing particularly well. And when you think about Netflix and where they've been focused, right? Um,

They produce a lot of original content. They know how to pipe it right into your brain. They know how to direct ads because they know what people are looking at and what else they like. And I'm sure this is a generative AI story at a large degree. They're talking about doubling their advertising business year after year.

it's pretty astounding. And, you know, just going back to the margins for a second, guys. So in 2022, they had about 39.4% gross margins last quarter, last year in 2024, 46, this year expected to be almost 48 next year, almost 49. And you think about that and you say to yourself, how do you maintain those sorts of margins? You know, I've long thought that this is a company that obviously I

I think Reed Hastings used to say that like we are competing when they talk about minutes spent on their site. They're kind of competing. I think he said this once with just how much you sleep. It wasn't that or something like that. We're competing with sleep. Yeah, which is a great line. But then the other thing is, is like, why not get into gaming? Why not get into, let's say, what Spotify does between music. For a while. And I think you're spot on with that.

Yeah. And, you know, it's interesting because, you know, a company like Spotify, which now has a hundred billion dollar market cap, which is truly astounding. It's a company that's operated on a very, very high level, especially as they broaden out their offering. But their margins about 30 percent. You think about that sort of combination with Netflix and your ability to cross sell and take costs out. Again, I think it's not likely to happen anytime soon. But again, it's interesting to discuss.

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Let's talk about some of these executive orders. I think there was like 80 that were signed, many of them overturning a lot of the policy that went into place under the Biden administration. Let's focus on the ones that we think have the potential to affect the economy first and foremost. And that's largely has to do probably with economics.

inflation and you and i spent and everyone spent a lot of time kind of trying to read the tea leaves i think into the election and out of the election who some of the appointments might be how some of the policy might change first and foremost i guess about tariffs and interest rates and the like so let's talk about what you've been seeing what you've been reading what you've been hearing and how you think it kind of works into your world economic view okay so it's interesting the tariffs i think

As it became clear that candidate Trump was in sort of the catbird seat, and once the election results came out, obviously there was concern around tariffs. That coincided, by the way, with the dollar strengthening and interest rates going higher for a myriad of different reasons, concern about inflation and the impact on tariffs being one of them.

And seemingly, and I say seemingly because I don't think this is what's happening, but the interpretation by the market over the last few days or week is that maybe the tariffs are not going to be as sort of draconian as the market feared. And maybe they're not going to take place in the same sort of timeline that the market was looking at. And I think that's one of the reasons we've seen the sell-off in the dollar. And I think that's one of the reasons we've seen 10-year yields go from about 4.8% down to sort of this 452, 453.

so that's been sort of the market impact now what i think is going to wind up happening is these tariffs which a lot of people view as just sort of a negotiating technique i'm not convinced that's the case you know i think he's going to sort of dig his heels in and i think the concern about tariffs that the people had in october november are going to sort of go full circle so what i think you're going to see over the next couple weeks into february is

the full the the round trip of concern about tariffs easing concerns about tariffs and then the re-acceleration of those concerns which in terms of the market will mean i think that interest rates are going to go back higher as will the us dollar

Yeah, so to your point about the sell-off and yields, it's worth noting that 4.8 was the high about a week ago, I think, maybe a few days prior to that. 4.8%, which was a new 52-week high from the last April levels that I think were like 4.75, were just below 4.6%. I mean, it looks like kind of a rounding area, guy. When you think about where we've come from in September, we were 3.6%. So to your point, since CPI,

We've seen again, you know, expectations for rate hikes to go out the window. People were talking about those rate potential for rate hikes in 2025. I want to just say a couple of months ago, I look at the CME FedWatch tool for the January meeting, which is next week. It's a near certainty that there are no cuts.

and then you have to go to March because there's not a meeting in February, there's still about a 75% probability, at least that's what the CME FedWatch tool is suggesting, that Fed funds will still be at 4.5% on the upper bound. And I think what you're also suggesting is if inflation starts to pick up just a little bit, because inflation only moderated a little bit that caused a big rally in bonds and then poor yields to sell off,

you know you might have yourself in a situation not too different than what we're you know into you know at some point in the middle part of last year where cuts go out the window and folks really start pricing in higher for longer which at some point has to affect stock market valuations yeah and i think listen i think some of the solves we've seen and by the way the solves have been one one and a half two day events but

I think they've been on the back of concerns about rising yields, which to your point, we got up to 4.8 and the market seemingly did not like that. And I think this administration, I think is laser focused on a few things. And again, going back to the Pod Save America guys from the Colbert show the other night, you know,

You know, Tommy Vitor said it. This president is really focused on a couple of things, the stock market, obviously, and I think rates to a certain extent as well. And they go hand in hand. And, you know, he is an individual that's talked about the want and the need for lower interest rates. And I think obviously under this administration is going to be a push for that.

But I don't think the market nor the economy is set up for that. We're at a precarious point right now where the potential for lower interest rates might just exacerbate an already existing problem, in my opinion.

We're going to have a special on the tape drop with the aforementioned Tommy Vitor of Pod Save America. So looking forward to that. That's going to be tomorrow morning. We're going to talk a lot about just drilling into some of those kind of policy effects on the U.S. economy. Before we get to some talk from Jamie Dimon on valuations, let's hit energy. Let's hit oil because some of those executive orders have to do with deregulating oil. We did see crude oil.

above 80 a couple of weeks ago. Now here we are at about 75 bucks. I think President Trump mentioned yesterday that they want to refill the Strategic Petroleum Reserve. The Biden administration tapped it to the tune of, I want to say, a couple hundred billion barrels in 2022 when the Ukrainian war started to kind of alleviate price concerns. But here you are. You have 75 oil. You have an administration that wants to refill

right, that petroleum reserve that only puts upward pressure on oil prices. And isn't that inflationary guy? One would think, I mean, I think the SPR can hold about 715 million barrels of oil. I think for those playing our home game, there are two facilities, one in Texas. I think the other one's in Louisiana, if I'm not mistaken. I think at its peak,

uh, we got down to, and I know that's a bit of a oxymoron, but in terms of how much, I think we were below 300 million barrels, which is the lowest we've seen in decades. So you hear now president Trump saying he wants to refill it to the tippy top. Yeah. You know what? I actually, that's something that I agree with him with, but I don't think

It's a straight line type of thing. I think there are rules and regulations around the refilling and there are timelines that one needs to adhere to to refill it. I don't think you can go out and buy it all back in one day, I guess is my point, as much as he may want to do it. But to answer your question, you know, him basically saying that we're going to be this –

buyer of crude on the margins, yeah, I think that sort of puts a floor in. Now, we did trade above 80 in WTI, as you mentioned recently. We've sold off a little bit. Crude has been in a pretty significant downtrend now.

If you really want to go back in time since the summer of 2022, he's talked about drill, baby, drill, which theoretically should put downward pressure on oil. But if you go back and look, I mean, under the Biden administration, we were probably producing a record amount of oil.

So it's a lot of commentary around this, a lot of headlines. You know, I think on the margins, the refill and then the subsequent wanting to drill probably evens out and it just becomes a supply demand thing. And more importantly, what are global economies doing? I think that's what the market should be focused on.

If you look at through the lens of the XLE, that's the Energy Select ETF, we know that Exxon and Chevron make up, I want to say 35% of it, throw Schlumberger in there and you get about 40%. And, you know, after the election, November 6th, you had a big gap in these large integrated names and just the XLE went from 90, I want to say to kind of 97 or so. And then it promptly fell dramatically, Guy, from about $98 off.

all the way down at the end of December, somewhere at like 82 bucks. Now we've since rallied back. I know that seems like a lot of herky jerk action. You have been bullish of large integrated energy names, specifically Exxon. What do you do with some of these stocks here? Because it's not like valuation's not an issue. It really has to do with policy and the direction of crude. - First and foremost, I thought in 2024, it would be the year of energy stocks. And my reasons were,

Obviously, a lot of geopolitical stuff. I think the underlying price, the fact that a lot of these companies, you mentioned Exxon and Chevron, throw Conoco in there. They're just running more efficiently. Their balance sheet's probably as good as they've ever looked. And valuation, you can make a compelling case. And I thought that as the market sort of peeled out of these higher valuation growth names,

they'd find their way into energy. That was true a couple different times, but it obviously wasn't true across the wide part of 2024. But those arguments that I made then, I think are still intact now. And if there's ever sort of a concern around the high growth names, one has to wonder where the money's going to go into. And I still think

there's a place for crude oil in this environment. And, you know, these stocks, you can't knock them on valuation in terms of the way they're operated. They've operated, they're operating better now than they have historically because they've been forced to and their balance sheets are in great shape. So, you know, I think,

Listen, I thought it in 2024. It didn't pan out. I think it again in 2025, that energy is going to be a place that people should look towards. Yeah. And part of that is China growth too. I think it's been kind of absent in this whole story. And let's talk quickly about tariffs. I think you made the point already that expectations were for much higher than what Trump just suggested, possibly 10% on China. Obviously 10% is going to hurt them. It's going to hurt the

buyers of Canadian goods. We know that they're dumping a lot on the world right now. So maybe 10% makes some sense. But on the flip side of that, China's economy is so weak. And you can think about it from a political standpoint or a geopolitical standpoint. I don't think we want to put our foot on their neck right now. And you've highlighted this from a geopolitical standpoint on many occasions. But help make some sense to this, that he's suggesting after all this tough talk,

on China, a 10% tariff. But now he's also suggesting a 25% tariff on our allies, which are also our neighbors, which is Mexico and Canada. Does that make any sense to you? Well, I mean, again, the optimist is going to say these are negotiating tools to get people to straighten out, and it's not going to be as draconian to use that term again.

as the market thinks. And look, there may be some truth to that. I would submit that now in his second and final term, I think you take the man at his word. So I don't think the market is pricing that in. And again, not being political, but I'm just trying to read tea leaves here. In that inauguration speech, there was a term used

that I think should have given people not concern, but should have piqued some people's interest. And it was manifest destiny. If you go back and read what that means, historically, that's meant that the United States has the God-given right to take effectively what's in our best interest. Now,

you know, you can argue whether or not that should be the case. I don't even want to get into that conversation, but there are obviously other people listening to that. So when we talk about manifest destiny here, it's easy for the Chinese to then say, you know what, it's our manifest destiny to take over Taiwan or the Russians to say, you know, it's our manifest destiny to take over Ukraine and other areas as well. So,

That, to me, should be concerning on a geopolitical level that I don't think enough people are talking about. Yeah, that's a great point. Okay, let's wrap this up with a little conversation about valuations. And you said earlier, at some point, valuations matter, and they matter relative to kind of interest rate expectations and inflation expectations and where we are in different cycles. Jamie Dimon, CEO of J.P. Morgan, to Andrew Ross Sorkin,

over there in Davos on CNBC this morning talking about asset prices are kind of inflated by any measure. They are in the top 10 or 15 percent of historical valuations. But, Guy, this is also someone who's been very cautious for a few years on the economy and on markets. You've made this

point again and again last year, he said that his own stock is expensive and they weren't buying at certain levels. And the other one that we spent a lot of time talking about in 2022, when he said that there's a hurricane coming for the U.S. economy that never really came, I think he might have nailed that very close to the bottom in 2022 of the stock market. Thoughts really quickly there.

Well, asset prices are kind of inflated by any measure. I mean, that's really all you need to hear. And, you know, we've talked about the different measures, whether it's this CAPE ratio, whether it's a Buffett indicator, whether it's just price to earnings on a historical basis. I mean, there are a number of different things that should give you pause. I think

What Jamie Dimon will also say, if he didn't say it during that interview and something that we say all the time, those metrics are not timing indicators. However, one thing that I have said is what it means the market has less and less room for error. So it's not like you're going out and trying to time the market on the back of this, but you have to understand when you look at all those different metrics in aggregate and sort of look at them in a historical basis,

That room for error gets smaller and smaller, and just sort of one thing can throw a monkey wrench into the entire mix. Again, I'm glad that he brought it up. As you said, he talked about a hurricane in 2022. He's been cautious since then. I think his caution is warranted.

you know, but for whatever reason right now, the market doesn't seem to really care. All right. Before we get out of here, I got an email yesterday from a listener, from a viewer, long time, not first time, but long time, you know, and he suggested something about how he's thinking about the market. This is somebody that's emailed with me in the past and talking about how he's positioning and the like, and the commentary, you know, and the

question, I guess, is like, what do I do here? You know, I'm not that optimistic about the economy. I think things are overheating. A lot of things that we just kind of talked about and looking to go to cash or more into cash. Now, there are alternatives to the stock market right now. There is a Fed funds at four and a half percent, which means treasuries are a bit above that, you know, so there's competition to returns in the stock market. But I guess what I need to kind of, you know, figure out with someone like this is what percent of that

cash is in a retirement account that you can't touch for a long time or in a more accessible investment account, right? Where you could probably or should be maybe a bit more nimble. And again, timing the market is really difficult. One of the things that you and I say to people

all the time, no matter how nervous you are in a retirement account, you got to think long-term, right? And you got to think about buying all the time when the market's up, when the market's down. So the idea of dollar cost averaging in a retirement account that compounds tax-free

Whether the market's up or down makes sense. Now, if you have investable assets that you think about a bit differently, that's more short-term oriented, that's maybe more thematic, that's maybe more geared toward different policies and the like, that's fine. But just understand that once you get out of the market, it's really hard to get back in because it's really hard to time the market.

All great points that you made. And it's an interesting question. And again, you know, I'll go back to Warren Buffett, who, if you look, now has north of $325 billion of cash or cash equivalents sitting around on his balance sheet. And, you know, he is waiting, it seems like, for a

for a rainy day. Now, I think he understands intuitively that there's no way for him to time that rainy day, but he just knows that it's coming. And I think to the question that this gentleman or young lady asked about getting concerned about the market and the frothiness, I mean, I think that's justified. Of course, the problem is we live in a time period where there's an immediacy about things. And if you sell something and the next day it goes up a couple percent, you immediately have

I can't believe that I did that. And you start beating yourself up. So, you know, part of it is just the world that we live in. It's very hard.

to watch the world pass you by theoretically with you sitting on the sidelines. But sometimes sitting on the sidelines as Warren Buffett seemingly is doing right now is the right place to be. No doubt. And just to put a bow in this whole conversation, I say this all the time, you know, the idea of taking a long-term view specifically in your retirement account and dollar cost averaging, if you had been doing that over the last few years, even going back to 21 and the bear market that we had in 22, you know,

you're gonna have a great average price, even though you kind of were in the market during a bear market in 22. So I think that's the way to think about that. And you take the pressure of yourself having to time that. So at the end of the day, great question, really appreciate them. Keep them coming, contact at riskreversal.com.

dot com bang up week guy that we have after you get done listening to this fine podcast. We're going to have a special drop on Thursday morning. It's going to be myself and Tommy Vitor. We're to go through a lot of this policy and what we are expecting for the balance of this administration and how that affects the economy and thus the markets.

And then you and I, tomorrow afternoon, sit down with Mike Wilson of Morgan Stanley. We're going to get a lot of his takes, what he's hearing from his large customers and the like, and where he sees the economy and the markets going and what sectors that you want to be focused on. So that's Thursday for a Friday drop. We got a lot going on. Take us out, Guy. Very interesting. And I enjoyed this conversation sort of

little more macro, a little more sort of 30,000 feet, but important conversations to have. And

You know, it is. There's a lot of interesting things going on right now. There's a lot of exuberance. There's a lot of excitement around all these initiatives that we're hearing. But you sort of sort of, you know, got to be clear eyed in terms of the market and the impact that it'll have. So I'm glad we're able to have this conversation, Dan, and looking forward to market call later today. There you go, Coach Taylor. Clear eyes, full hearts, can't lose. That's that's our motto here. Appreciate everyone being here. We'll see you tomorrow. Tommy Vitor, Friday, Mike Wilson. We got a big slate. So thanks.