Money Life with Chuck Jaffe

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First American's Fleming: Lower rates threaten to return the economy to 'normal' Sep 19, 2024

Show notes

Mark Fleming, chief economist at First American Financial Corp., says the big news on Wednesday was not that the Federal Reserve started a rate-cutting cycle, but that it appears that there could be additional, aggressive rate cuts that could take an additional 1.5 percentage points off rates over the next 15 months. That rate cutting, Fleming says, reduces the risk of a deep recession, and the strength of the labor market also limits the possibility of a big decline. As a result, a year from now he expects to see a "lower mortgage rate, lower cost-of-credit rate environment -- with a relatively healthy economy, if not running at trend -- and low inflation," which he says would be a return to "normal." Todd Rosenbluth, head of research at VettaFi, looks at a fund saddled with keywords -- the WisdomTree International Hedged Quality Dividend Growth Fund -- and tells us which of those traits are so important now that the fund deserves to be ETF of the Week. Plus, in the Market Call, Dave Sekera, chief U.S. market strategist at Morningstar, talks fair-value investing and gives his take on how stocks will respond to the rate-cut environment.

Bankrate's McBride: The Fed -- and the impact of rate cuts -- is just getting started Sep 18, 2024

Show notes

Greg McBride, chief financial analyst at Bankrate.com, expects the Federal Reserve to cut interest rate three times before the year ends — starting with a first cut being announced today — and says the central bank will drop rates by one full percentage point by the time 2025 rolls around. He talks about how and where consumers and investors will first feel the impact of the cuts, and how to make the most of the looming changes. Bart de Bruijn, founder of EstateX, talks about tokenized real estate investing, an emerging concept that allows investors to effectively buy shares in properties, which they can then trade on a public exchange. Chip Lupo discusses WalletHub's latest iPhone survey, which showed — among a raft of counter-intuitive issues — that 90 percent of Americans think Apple's signature device is overpriced, but which two in five Americans would go into credit card debt to purchase anyway. Plus, Vince Lorusso, chief executive officer and portfolio manager for the Clough ETFs, discusses "valuation investing" in the Market Call.

Baird's Pierson: Chugging economy will avoid deep recession (but not tax hikes) Sep 17, 2024

Show notes

Warren Pierson, co-chief investment officer at the Baird Funds, says that he expects the economy to keep chugging along, avoiding a deep recession as it enters a rate-cut cycle that initially trigger a rally but investors will not want to extend the duration of their holdings too long. Pierson notes that no matter who wins the White House in November, he expects tax hikes in order for the federal government to attack deficit problems, and he says the bond market — particularly the municipal bond market — is already anticipating that move, and is attractive as a pre-emptive move now. Robert Farrington, founder of The College Investor helps Chuck answer a listener's question about college-savings plans and how to set money aside creatively and flexibly in case the children don't take the traditional college path when their time comes. In the Market Call, Bernie Horn, manager of the Polaris Global Value fund, talks about where in the world he is finding solid values now.

Merrill's Quinlan: The volatility ahead is a chance to buy the dips Sep 16, 2024

Show notes

Joe Quinlan, head of market strategy for Merrill and Private Bank, Bank of America, says that he expects the stock market to show better breadth in 2025, with other stocks picking up slack for the Magnificent Seven stocks, which he thinks will keep growing but at much slower rates. He notes that "the U.S. economy continues to defy expectations," and as long as that continues — and he is optimistic that it will, unabated by whatever happens in the presidential election — he will keep advising investors to buy the dips, favoring high-quality dividend payers. David Trainer, president of New Constructs, puts Sunrun back in the Danger Zone, noting that the stock has outperformed as a short since it was first singled out in 2022, but that a recent bounce-back has simply set it up for the next fall as the company runs out of money. Jerry Parker of Chesapeake Capital Corp. — one of the original Turtle Traders, a ground-breaking group of commodity traders from the 1980s — talks trend-focused investing in the Market Call, and Chuck answers a listener's question about why shares in Trump Media and Communication stock were halted on Friday, and whether the move might have had political motivations.

Sabrient's Martindale on a different way to view inflation Sep 13, 2024

Show notes

Scott Martindale, chief executive officer at Sabrient Systems — which takes a quantitative approach to investments — says that some of the standard measures of inflation are skewed in ways that present an inaccurate picture of what's happening now. He discusses the "Harmonized Index of Consumer Prices" and how it, and several other measures, suggest that the Federal Reserve has plenty of room to make a larger rate cut now, and while he doesn't expect the central bank to take that drastic step, he expects that the rate-cut cycle will pick up speed after the first cut is made. Trader Edward Corona, publisher of The Options Oracle, says that the stock market that is flirting with record high levels is giving him a lot of technical opportunities to look at reversal plays, the kind that has punished Nvidia stock since a recent mediocre earnings report. Mitchel Penn, managing director of equity research at Oppenheimer and Co. looks at how business development companies are likely to perform in a falling-rate environment, and identifies a number of BDCs that historically have generated high returns on equity with low credit losses along the way. Plus, Scott Bennett, founder of Invest With Rules, brings his trend-following methodology to the Money Life Market Call.

BlackRock's Chaudhuri: Expect a broader, more-volatile market and buy quality Sep 12, 2024

Show notes

Gargi Chaudhuri, Chief Investment and Portfolio Strategist, Americas, at BlackRock, says that while she foresees a slowdown in the economy but nothing that will rise to the level of a recession. Still, as the Federal Reserve enters a rate-cutting phase during the fall — a historically volatile time for the market — she expects that investors will see heightened market movement, and that they will need to be patient to ride out the bumps confidently. Chaudhuri expects the market to broaden out, and says "keep high quality, add some defense and look for continuing gains over a longer period of time." Another way to answer Chaudhuri's call for caution would be with a low-volatility fund, and Todd Rosenbluth, head of research at VettaFi , makes one his ETF of the Week. Chuck revisits his July decision to not get pet insurance in the wake of the injury his puppy Maho suffered in early August and the significant vet bills he has paid since. Plus Ivana Delevska, founder of SPEAR Invest — which runs the Spear Alpha ETF — talks about finding value in the industiral supply chain in the Market Call.

Treussard on geo-political risk and 'What if it comes home to roost?' Sep 11, 2024

Show notes

Jonathan Treussard, founder of Treussard Capital Management says "we haven't seen this much geo-political static on the horizon in at least a generation," raising real concern about how a laundry list of global boiling points could hit home. He says those risks overhang a market that looks like it can avoid a downturn for a while with the Federal Reserve looking like it can deliver a soft landing. Catherine Collinson, president of the Transamerica Center for Retirement Studies looks at the group's latest research into the state, outlook and retirement readiness of the American middle class and, in the Market Call, Manny Weintraub, principal at Cannell & Spears, talks about his unending search for "super great stocks that won't kill you."

Invesco's Hooper says there will be no recession in the next year Sep 10, 2024

Show notes

Kristina Hooper, chief global market strategist at Invesco, says that recessions haven't been canceled, but there is no reason to expect one for at least the next year, "especially if we get the Fed to start to meaningfully ease." She thinks the Federal Reserve will start that easing process later this month with a small rate cut, largely because anything larger might spook the market. Hooper says she thinks the Fed is late to begin the cuts, which is why making the move now and starting the rate-cutting cycle is important for staving off recession. Chip Lupo, writer and analyst at WalletHub discusses the site's recent study into the best places to retire, finding that four of the top five locales being in Florida, but the fifth in frigid Minnesota. He discusses the factors that will ultimately make some community best for you. Plus, market contrarian Hilary Kramer, who runs seven different investment newsletters, focused on everything from value investing to IPOs to trading and more, returns to the Market Call to talk stocks.

New Constructs' Trainer: 'Major correction' ahead for stocks with shaky numbers Sep 09, 2024

Show notes

David Trainer, founder and president at New Constructs — who put Nvidia stock in "The Danger Zone ahead of its earnings report at the end of August, just before the stock cratered — says that the market and economic conditions are changing and lower liquidity and a slowing economy "is a recipe for a major correction in a lot of individual stocks," and that companies with misleading earnings are particularly likely to be punished. That's why he put Dayforce in the Danger Zone, because it has "the most overstated earnings" in the Standard & Poor's 500. Trainer also reiterates his call on Nvidia, noting that despite the stock's recent drop, it has a lot more room to fall. John Cole Scott, president of Closed-End Fund Advisors discusses how investors in closed-funds trading at premiums can use sector-swapping to turbocharge their gains, selling funds trading at premiums to buy similar funds currently at discounts, and provides examples of how this would pay off now. Andrew Leigh, author of "How Economics Explains the World: A Short History of Humanity," discusses how almost everything — from climate change to the instrument a child plays — is impacted by economics and how economics can therefore be used for better decision-making. And in the Market Call, George Young, co-manager of the Villere Balanced and Villere Equity funds, talks about having the patience to let long-term plays on smaller companies pay off.

Vontobel's Souccar makes the case for Europe, Canada and Japan now Sep 06, 2024

Show notes

David Souccar, international equity portfolio manager at Vontobel Quality Growth, says that the interest-rate cutting cycle is going to help international equities, as foreign central banks follow the Federal Reserve's moves, which should help foster a softer landing worldwide. That said, Souccar notes that if the United States starts raising tariffs radically, it will hurt the dollar, which will make investors want to invest internationally to protect against the dollar's falling value against other currencies. Souccar notes that investors are likely to find the most opportunity in Europe — particularly in Great Britain — Canada and Japan. Plus, Todd Rosenbluth, head of research at VettaFi, picks a total-market fund that equal weights its holdings by sectors for his ETF of the Week, Matt Schulz, chief credit analyst at LendingTree, discusses their survey on how many parents give children access to credit cards and how often they regret that decision, and Kelley Wright, editor of Investment Quality Trends, brings his disciplined approach to value investing to the Market Call.

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