Mortgage Rates Fall: Should You Buy or Refinance?
47:10 Share

On radio, on YouTube, streaming live on investtalk.com, and for our podcast subscribers, this is InvestTalk. Independent thinking, shared success. InvestTalk is made possible by KPP Financial, a registered investment advisor firm serving clients throughout the United States.

Here is KPP Financial Chief Executive Officer, Financial Advisor, Justin Klein.

Good afternoon, fellow investors, and welcome back to InvestTalk. This is our March 7th, 2025 edition of InvestTalk. Welcome to the weekend. We're almost there, but before we head off into the weekend, I'm here to unpack today's market movements and the current trends that we're seeing in the economy and markets. So we are here to help you become a better investor.

One step at a time. It's not about getting rich quick. It's about getting rich slowly, capitalizing opportunities and avoiding pitfalls. That's how you do it. You make smart decisions and you make more good decisions than bad. You're never going to make the right decision every time. But the more data you have, the more perspective you have, the better odds you have of making that better decision.

weeding out the emotions and focusing on the facts. That's what we're here to help you do. And the main way that we do that is by answering your finance and investment questions. So don't hesitate to reach out with anything that's on your mind at 888-99-CHART. Now in just a bit, we're going to talk about today's market performance and run down the show topics for the hour. But as usual, let's tackle this color question first.

Hiya Luke and Justin. Talking about the Trade Desk, ticker TTD. Been interested for a bit regarding this stock. I think it went up to about $120, $125 or so, and then earnings dropped it down to around the mid-70s. Now we're looking at mid-60s. Wondering if this is a good time to pick it up. If it's not, what price do you think would be a good level to pick it up? Appreciate what you guys do. Thank you.

All right. I'm seeing a lot of these chart patterns out here, you know, high flyers, names that everyone, you know, the average retail investor was getting into trading at high multiples. And then suddenly things break, right? They break lower. You're in a downtrend and it's aggressive. And that's what you've seen with Trade Desk. It peaked around one hundred forty one dollars back in. Let's see. That was not long ago, back in December.

Early December. Now we're at 64, 91. And the reason is because if you look at the earnings projections going forward, they're now a lot slower. In fact, this quarter, earnings are expected to be negative 3% year over year. And last quarter, they were up 44% year over year. Earnings for 2025 only expected to be up 7% year over year versus last year was up 32% year over year.

And so what's happening? The multiple is contracting. Now it's still trading at 39 times earnings, 39 after being down 54% from its 52 week high. And this is the perfect example of why these sexy growthier names are very risky.

Now, typically, I've said this before, when you get these type of high flyers and then the market corrects and they go back to a reasonable valuation and all the weekends flood out, which has kind of happened over the last couple of months, they typically go down anywhere from 60 to sometimes 90 percent. 80 is kind of average.

Okay. Now you go based on 80, this would bring it down to about in the high 20s called $30 per share. Now it's at 64. So I do think there's more downside. Now, what would 30 would a 30 multiple be a little low for this or if their price of 30 be a little low if they're going to earn $1.78 this year? Yeah, I think that, you know, so maybe it doesn't get quite down that far. But, you know, the momentum is down. The relative strength is eight. It's a day to even get a bounce today.

No, it was even down 7 cents today when the market bounced. So still relative weakness in the name. There's not major support until about $55 per share. And it's at 60, roughly 65 today. So certainly more downside ahead. And you really want to look for some sort of capitulation. What capitulation is, is when something's in a downtrend and the volume's kind of consistent. And then usually you get one down.

another good down day on big volume, triple, quadruple, average daily volume. And that is everyone throwing in the kitchen sink and saying, okay, I'm done with this name. I'm out, right? And that would be the signal to potentially pick up Trade Desk. So it's a good company, good growth, good profitability. I like it at some point, but I would be very patient on Trade Desk. I think there's much more downside.

Now, before we go any further, let me tell you about the second annual InvestTalk Market Madness Competition. It's underway right now, and you can win $1,000 by showcasing your investment skills. Here's how it works. All you have to do is enter your March Madness bracket.

And what you will do is you'll participate in a series of stock matchups each day, predict which stock will outperform on that particular day. And the individual with the most accurate predictions takes home the prize. The value of each round goes up and the one with the most points wins. Now registration closes on March 17th and you can enter over on investtalk.com. So get in the game.

Now, we have a lot of ground to cover over the next 45 minutes or so, and here's some of what I have planned. Our main focus point is about mortgage rates. They are falling. Should you... Does that mean you should buy? Does that mean you should refinance? We'll talk about that. In addition, 401ks. More and more people are tapping their 401ks as their rainy day fund. And we'll talk about the pros and cons of that. Also, Doge.

Doge is laying off workers. They're doing some things. And the question is, how much will they get done from a legal standpoint? And how much have they saved the American taxpayer? And ultimately, what does it mean for the broader economy? So we'll look at that. And then British Petroleum, BP, they've been in a deep downtrend ever since 2008 when it was

well over $250 per share. Now it's down to about $50 per share. Huge, just over a decade long downtrend, approaching actually two decades now. But they're starting to make a shift in policy. Now this isn't a discussion directly on BP, but it's showing you that some of these names, especially in the energy patch that were focused on green energy are starting to pivot and in many ways that could be very good for their business.

We also have voice bank questions. One is on LNG Chenier Energy and then Verizon. And we also have some questions that came in via the comment section over on our YouTube channel as well. And of course, I welcome your finance and investment questions right now, but we are headed into a short break. And on the other side, I'll take a look at today's market activity, then tackle more of your questions here in InvestTalk at 888-99-CHART.

Okay, got to get serious with my finances. I've been working a long time and I know there's still got to be more that I can do to build my wealth quicker. I don't want to have to work forever. If you are not maximizing your employer-sponsored retirement plan, KPP Financial can help.

With our professional oversight, you can potentially enhance your investment performance by an average of 3% annually. At KPP Financial, we provide a comprehensive 401k management program designed to optimize your retirement savings.

Our approach includes creating custom investment allocations tailored to your goals and risk tolerance. That can make a big difference in your favor. Maybe it's time to tune up my retirement plan. For more information on how you can take control of your retirement savings, visit our website, kppfinancial.com. KPP Financial.

Sounds good. Life in general can be chaotic, right? Especially if you have an e-commerce business. And that gets us to order fulfillment. Now the good news, you can calm the chaos of order fulfillment with the shipping software solution that delivers. ShipStation. I can tell you this, it feels great to be able to save serious money on shipping expenses by taking advantage of industry-leading discounts.

ShipStation is the fastest, most affordable way to ship products to your customers while your e-commerce business enjoys discounts of up to 88% off UPS, DHL Express, and USPS rates, and up to 90% on FedEx rates. ShipStation seamlessly integrates with the services and selling channels you already use so you can manage orders on one easy dashboard.

dashboard. You'll ship more orders faster and automate your workflow to reduce human error and create 15 times more labels per hour. So, deliver a better customer experience with industry-leading, scalable features that help ensure accuracy and provide automated tracking updates with your company's branding.

Calm the chaos of order fulfillment with the shipping software that delivers for you. Switch to ShipStation today. Go to ShipStation.com and use code INVEST to sign up for your free trial. That's ShipStation.com, code INVEST. Justin Klein is here and he's ready with answers to your finance and investment questions. Call InvestTalk. 888-99-CHART.

Now let's go take a live call. Jerry from Palo Alto looking at CrowdStrike. Do you own it or looking to buy it? Own it, looking to buy more because it got hit pretty good. I'm hoping it's, well, I actually bought more today and I thought it was getting a good deal, but it could have been a better deal. Why do you want to buy more?

Because I've been at it for a long time. It's done well. On the upper side, it's gone a lot higher. I definitely don't have the charts that you do. But just in the range. Okay. Well, this kind of reminds me a lot of the stock we just talked about, which is Trade Desk. Very high multiple stock, a fast grower. But the growth is slowing.

dramatically. In fact, this year, earnings are supposed to be down 10%. Last year, they were up 27%. The year before, they were up 101%. The year before that, they were up 130%. The year before that, 148%. So it was a fast grower. It's not expected to grow dramatically this year. In fact, earnings are supposed to contract. So what multiple are you willing to pay for a company that has no longer earnings growth, but actually earnings contraction?

Is it 88 times? Because that's currently what it's trading at, even after dropping 26% from its two-week high. I think there's dramatically more downside to come if that manifests. And analysts are continuing to downgrade earnings expectations for this year and next.

So to me, this is one of those high flyers that you're basing on, oh, it's gone up because that was in an era when, in a timeframe when growth was outperforming, when multiples were expanding. Now multiples are contracting. You saw that with Trade Desk and you're starting to see a crowd strike. So what is a reasonable multiple for a company that actually has negative earnings growth? Typically, it's in the teens at best. Let's give this a generous example.

A generous multiple. Let's say at 30 times, okay? That's around $100 per share. That'd be a generous multiple. And it's at $335 per share right now. So $333 per share. Price of sales, 21. I always say anything over 20 is egregious, okay? Enterprise value, you have $279. And it has a billion dollars in free cash flow and an $82 billion market cap. It's a little over a 1% free cash flow yield.

So this needs to drop by about 60% to 70% for the multiples to become reasonable. So good company. Probably want to continue to have it on the watch list, but I would not be adding to it. In fact, I would be looking to rebalance and try to trim from a tax perspective in an efficient tax manner because I think there's more downside to comfort crowd strike. All right. That's why I'm listening to you guys. There you go.

Thank you for the call. Now let's take a look at the markets today. It was a bounce back day. And I got a crowd strike, by the way, down another 4% today, even though the market bounced back. So it shows you continue to relative weakness out of those, especially mid and small cap type of growth year names. They're kind of coming undone. But today you had that bounce in markets overall of the mag seven market.

Microsoft, Amazon, and Tesla were still negative. So some relative weakness out of there. You had Nvidia up nearly 2%. Apple up about 1.6%. Google up nearly 1% on the day. So a mixed bag in the Mag 7, although Netflix did continue its weakness at about that negative 1.6% on the day. Where else did you see pockets of weakness? The banks. And this is another kind of tell that...

What's happening in the broader economy is negative for the banks. J.P. Morgan down nearly 2%, Wells Fargo down over 2% on the day. And you had the retail side, Amazon, like I said, negative. Costco down 6%, Walmart down 3%, Home Depot down over 1%. And you continue to see strength in those non-durables.

So your consumer staples, Coke and Procter & Gamble were up, for example. Healthcare continues to be strong. Names like Johnson & Johnson and AbbVie and Abbott Labs were up, even though Eli Lilly was down 4.7%. Another one of those, you know, there's the shades of growthier names like Eli Lilly around GLP-1s and all that.

that whole trade is kind of coming off and being and showing weakness there. So continue money flowing into those non-cyclical names outside of energy. Energy continues to be strong. You're finding a floor in oil prices, and I'm starting to see a bit of outperformance on that front. On the jobs front, you did get a bit of a miss for the January, February jobs number. Unemployment rate did tick up from about four to almost 4.2%. And the unemployment,

The revisions were about neutral. So kind of a neutral jobs report overall. Continue to see a jobs market that's not strong or particularly weak, but not making really positive headway. Now we're moving into a break. Still to come, my focus point and more answers to your questions and YouTube questions as well. So give me a call now at 888-99-SHARP.

The InvestTalk Market Madness competition is underway now, and someone is going to win $1,000 just for showcasing their investment skills. But you can't win if you don't play. So visit InvestTalk.com right now to get all the details and join the fun.

Now our main focus point today is about mortgage rates and how they've fallen. And the question is, does that mean you should maybe buy a house if you don't own one or should you refinance? Now let's take a look at the numbers here.

And if you compare today's rates, which are about 6.65% on average for a 30-year mortgage, we're down about 10 basis points over the last week. So from 6.75 to 6.65. And that means for every $100,000 you borrow, your payment would be about $641.96. Okay?

Now, that compares to February 26th. It was at 6.84%. And in January, it was at over 7%, 7.09%. And this time last year, the mortgage rate was 7.22%. So we're making headway, but not dramatically so. And frankly, I don't expect it to be, don't expect 3% or 4% mortgages maybe in your lifetime again. That's very possible. 7% is longer-term averages.

I know we were conditioned to these low rates for, you know, basically since the financial crisis. But that's not a normal operating environment for interest rates, for mortgages, etc. Now, what could bring this down more? Well, obviously, a headway on inflation expectations because higher inflation expectations means higher long-term interest rates. That's number one. Number two, the Fed can go in there and start purchasing interest.

more longer dated securities, so QE of some type or stopping QT. That's likely to happen in the first part of this year. Also, the Fed going in and entering the mortgage market again, buying mortgage-backed securities. Right now, they're selling mortgage-backed securities, which is increasing that spread. Now, once again, if they stop QT, that will help shrink the spread a little bit more. So I do think over the year, mortgage rates will come down.

But probably not dramatically so. 6%, 5.5% is probably as good as you're going to get at least this year. Could change, but that's likely what you're going to get this year. Now, still one in four Americans cite real estate as their top long-term investment, second to the stock market. So a lot of people see this as a way to gain wealth. And if you do it right, you can.

Now, should you refinance? If you are an investor, if you are just a homeowner, well, first off, you need at least a 50 basis point spread to make it typically worthwhile, the closing costs and all of that. Fortunately, the vast majority of people remain below that 50, below that 6% level, okay? And I don't think that's not going to change, right? Anytime soon, because so many people are just locked in.

Now, should you buy a home? Should this spur you to buy a home? Not necessarily. Once again, I think there's lower rates in the future. But what I always say about buying a home, your personal residence, it should be about your lifestyle, your happiness, and the sustainability of paying that mortgage. Whether mortgage rates are 7% or 3% or 5%. What's that monthly payment? How stable are you in your income in order to afford it?

And then ultimately, does that home fit your needs, fit your requirements for a healthy, happy life? From the amenities to the size to the location, all of that. Ever checked your boxes? Don't sit there and say, oh, home prices are high. I don't want to buy and expect a no-weight crash because that's unlikely.

you see that with what happened with covid right the government steps in and they stimulate things to to avoid some deflationary spiral like oh wait that's what 08 was it was a deflationary spiral now could you have short-term drops in home prices especially in pockets of the country absolutely places like austin texas are definitely weak right now uh and places in utah etc so it can happen

just not likely to be you know 50 plus drops like we had uh in 08 and over a 10-year period likely due to inflation prices will move higher so mortgage rates are down don't expect huge headways going forward on that front but certainly uh no reason to wait to buy if you can afford it and it checks your boxes now we are are we headed to a break all right we are headed to a break

On the next InvestTalk, we'll look into this story. One in three Americans experienced financial fraud in the past year. A new bank rate survey reveals that a staggering 34% of U.S. adults have experienced financial fraud or scam in the past year, with nearly two in five losing money as a result. That story is for Monday, but for now, I'm Justin Klein. I'm ready to take your calls now at 888-99-CHART.

Let me touch on a topic that most listeners need to understand. I want to talk about creating a trust and a will. Until recently, this has been a very slow and time-consuming process. Things have changed now because trust and will makes creating your will easy. And before I go further, let me pass along the news that you can get 10% off at trustandwill.com slash invest.

Listen, I know from personal experience that the peace of mind that comes from having one's wishes and assets secure is a good feeling. And once you get your trust and will squared away, you can focus on the other important tasks in your life, whether they are for business or fun. When you work with trust and will, each will or trust is state-specific, legally valid, and customized to your needs. Their simple step-by-step process guides you from start to finish, one question at a time.

You'll be able to keep your family prepared and protected by managing your will or trust online. Uncomplicate the process with Trust & Will. Protect what matters most in minutes at TrustAndWill.com slash invest and get 10% off plus free shipping. That's 10% off and free shipping at TrustAndWill.com slash invest.

2025 rolls on and you've got finance and investment questions for Justin Klein and Luke Guerrero. Call InvestTalk 888-99-CHART.

Hi, Duncan from New York. Thank you for all that you do. I have a quick question about these three major telecom companies, Verizon, T-Mobile, and AT&T. I recently just bought T-Mobile. I already have AT&T and Verizon. I feel like I need to at least sell like one of them. What do you think I should get rid of if I had to get rid of one of them? AT&T and Verizon are in my Roth IRA long-term. T-Mobile is more like a trade that I did in my just regular brokerage account. But

But I'm looking for both long-term and short-term ideas. Thank you very much and have a good day. Bye. All right. Well, you're certainly looking at a space that is doing fairly well, good relative strength. And T-Mobile has a relative strength of 94. AT&T's relative strength is also 94. And Verizon is 82. So all in the top quintile of T-Mobile.

the past year in the markets. And so this has been a bastion of strength, right? Non-cyclical names, names that you're going to use your cell phone no matter what the economy is doing. You know, it's so ingrained in our society. No one's canceling their cell phone bill because of financial hardships, at least very few people are. And, you know, T-Mobile has been stealing share from Verizon and AT&T for a while, right?

And that's why you see Verizon's relative growth rate is last quarter revenues up 2%, earnings up 2%, AT&T up 1% on sales, flat earnings. And then you look at T-Mobile, that's been growing revenue at about 7% and earnings at about 40%. So that's why it's trading at that higher multiple. You know, I see no problem owning all three companies.

Because of that relative strength, now it just kind of depends on what type of company you want, right? The Verizon AT&T, very slow growth. They're not trading high multiples around 10 forward PE, but that goes back to what I've always said. You know, when you have slow growth names, they tend to trade at, you know, low teens, high single digit multiples, and that's fair value.

Or companies with just consistent cash flow and not a whole lot that you want to expect from the growth side. You know, the issue with Verizon AT&T is that they are heavily indebted. They do. And that was a struggle over the past couple of years when interest rates were going up. And the worry was they were going to.

they were going to buckle under the weight of that debt. Well, they haven't. Their cash flow has come down, but overall, they're in fairly good financial situation. So T-Mobile, once again, has that growth. It also has some debt, but a much better debt profile than the other two.

So if I'm going to sell one, it would probably be AT&T and Verizon for the diversification stake, right? Is which one, they both have debt issues. And so if interest rates start moving up again, which over the long term we expect, those are the, and their bond proxies, right? They pay a high dividend. T-Mobile, I don't believe they pay a high dividend. It's about 1% dividend, nothing big there. So AT&T and Verizon are too similar. So you want to pick one.

Most likely. Okay. And so that's the way I would think about it. If you're going to sell one, I would sell one of those. Thanks for the call. Now let's briefly mention the newest KPP premium newsletter, which will be distributed tomorrow. And this week in the KPP insight section, we discussed GDP forecasting and what it means. And then we're looking at stock ideas.

an HVAC company, as well as an electric company. And in the portfolio management section, we touch on the 60/40 portfolio. And if you're interested in learning more, visit us at investdoc.com and subscribe. The newsletter will come to your inbox on Saturday mornings. Now let's keep things moving, get back to the fresh, to get to a fresh question from the comment section over on our YouTube channel.

Jesse Colnero says, what sectors do you see outperforming the next six to 12 months? I've transitioned my portfolio to be overweight consumer staples, utilities, precious metals, and healthcare. What are your thoughts? I don't have a lot of thoughts. Those are generally the wheelhouse. I think that energy is a good contrarian bet after the recent drop because OPEC's already come out with their

supply increase. So that's kind of now priced into markets. And there's a lot of negativity around the economy. I don't think it'll be as bad as everyone's expecting because I don't think the Doge cuts will go through as dramatic as they're saying. And then there's a lot of stimulus out of China, which is a big user of oil and energy. And so I think that's a good contrarian play.

I do see continued weakness on the consumer side. I don't think they'll spend at the same clip. Same with tech, right? A lot of multiples are contracting. We've talked about that today with Trade Desk and CrowdStrike and a lot of the Mag7 names continue to show their downside. And so I think that will continue to be weak.

And then financials, I think there are pockets of likely strength, but the banks in general, they've, you know, if interest rates come down, that hurts their spread that they can lend at. And if there's increasing defaults from the consumer due to layoffs from Doge, for example, you know, that could cause some sort of default cycle on that front.

So those are areas that I'd be a little bit more weary on. And the ones you listed are pretty good. Precious metals continue to be strong, showing good relative strength. So I like it. Now on Fridays, we generally make time for a quick rundown of some key benchmark numbers. Now the two-year yield, down a bit from last week to 3.96% from a little over 4% at the close of last week. The 10-year, 4.28%.

That was actually up a bit from last week, was 4.24. So interesting little yield curve shift, steepened slightly. Gold, 2907 an ounce, and that was up from 2843 an ounce. So there's that relative strength on the precious metal side.

Silver, that was at $32.20 an ounce, up $1.27 from $31.03 an ounce last week. This is all because of a weaker dollar. Big break lower earlier in the week in the dollar. Oil, $66.97 a barrel, down about $3.12 from last week, which was at $70.09 on that news of OPEC increasing supply. Gasoline.

You saw a decrease of one cent from last week to $3.10. Here in California, though, $4.73 per gallon, down six cents. So we had a much bigger break from the move this week. Per comparison, in Mississippi, the average gallon of gas, $2.64, over $2 less than what we pay here in California. Now let's squeeze in another caller question right now.

Hey, Justin and or Luke. This is Dan from Walnut Creek. And before I get into my question, I wanted to say what a treat it was to hear Steve's voice on one of your replays this afternoon. It was a real treat. I have some Chenier Energy

Stuxable LNG and some Devon DVN. And I was thinking of selling those two and purchase some more of EQT Corporation, Stuxable EQT. And I was wondering what your thoughts were on that. Thanks. Bye. All right. Looking at EQT and selling some of your other energy names. Now let's take a look at EQT. And it is mainly a independent natural gas producer.

Focused in the Marcellus and Utica shale regions in the Appalachian Basin in the eastern United States. It's kind of around Pennsylvania. And I've said this before that natural gas is likely to be in increasing demand and a lot. It's kind of the swing molecule now in energy markets.

And the relative strength in EQT is much better than a Devin, a little bit different than LNG, right? LNG is exporting natural gas and, you know, that the spread between the price of natural gas here and the natural gas price overseas that can move around. It's kind of like a refiner where they have the crack spread, right? It depends on various dynamics globally. And so I kind of like this idea.

you're getting more of a pure play natural gas producer in uqt its relative strength is 89 versus devins 20 and you are less at the whims of geopolitical concerns and and problems and geopolitical uh economic wins all of that with sheer energy which once again is all about exporting liquefied natural gas

and that relative strength is strong 89 but i would rather bet on an eqt and a pure play natural gas producer now let's touch a bit on 401ks and there's some interesting new numbers coming from vanguard a big 401k provider 4.8 of 401k account holders took an early withdrawal last year

And that's a record high, up from 3.6% in 2023 and an average of 2% pre-pandemic. Now, Congress has made it easier to get savings for emergencies. You can get up to $1,000 now for emergencies from your 401k without penalty. But more workers are falling behind on their auto loans, their credit cards, and so they're tapping more into their retirement funds. Now, this might sound really bad,

because that big drop right jump from two percent on average to 4.8 sounds like a lot one issue though that's kind of skewing this is that more and more companies are opting their workers into the 401k automatically and so that's obviously opting a lot of workers in on the lower end of the income spectrum and those are the people that are more likely to fall behind on on payments and need to tap the 401k to avoid things like foreclosures

about 35 of those who took hardship distributions last year did so to avoid a foreclosure or an eviction but that is down from 2023 which was 39 now 16 used it to repair a home or purchase a home now the reason i i call this out as more automatic enrollments is that in 2024 61 of new hires were automatically enrolled in a 401k that's up from 36 percent back in 2014.

so 10 years earlier the share of participants with an outstanding 401k loan at the end of 2024 was roughly flat at about 13 so it's an indication that this opt-in strategy is kind of good it helps people have a rainy day fund whereas before bad money habits would force them to go to a payday loan company right which charges huge interest huge interest

Whereas this is a much better way to tap, to find your way through tough economic times. And I never recommend this is your first resort. Shouldn't be. You should find other ways besides this, especially if you're getting a match. Because what happens when you borrow from a 401k is when you pay it back, you're not getting that match. And that's guaranteed return on your money.

So you want to avoid that loan and especially distribution, which can cause taxes and penalties. Let's go take a live call. Tiffany from San Francisco wants to ask about VGK. Hi, thanks for taking my call. I'm just wondering if this is a good time to gain to this ETF since European markets are doing well. Yeah.

Yeah, this is the Vanguard Euro index, Europe index, Europe ETF. And this is at a 52-week high today. And the simple answer is, yeah, I think this has been struggling for a long time. And this shift in U.S. policy towards Europe is pushing countries like Germany to rethink a lot of policies that would, frankly, if they are rethought, would be stimulative.

For example, their fiscal budget. Right now, they have some caps on how they can spend, you know, how much they can spend and how much debt they can take on. They're talking about because of the demand to, you know, beef up their military, for example, that they need to take those caps off and maybe even invest in other countries in Europe to help the Euro region.

So then they're a country with a lot of fiscal room. There's not a lot of countries out there that have the fiscal room because, you know, they've been relatively fiscally conservative for a long time and they've had a good industrial base. And so a lot of the companies in Europe are are cheap. And if this starts to stimulate demand, stimulate economic growth, well, multiples are naturally going to go higher.

And so I like this idea. I think it's a good way to gain exposure to Europe. And you're seeing that with the relative strength being at a 52-week high, why our markets are struggling. Thanks for the call, Tiffany. This is InvestDoc. I'm Justin Klein. And we have one goal each and every weekday. Let's help you achieve your own version of financial freedom. So if you're going to call, don't hesitate. Pick up the phone right now and give us a call at 888-99-SHARP.

InvestTalk is ready 24-7 for your finance and investment questions. I'm hoping you'll give me your take on Ormat Technologies, O-R-A. Is it a good idea to sell your losses in a Roth IRA and just use whatever you have left to reinvest into better stocks? Don't forget to call InvestTalk, 888-99-CHART.

The InvestTalk Market Madness competition is underway now, and someone is going to win $1,000 just for showcasing their investment skills. But you can't win if you don't play. So visit investtalk.com right now to get all the details and join the fun. Now let's fit in one more question from our InvestTalk YouTube channel. Jim Leahy says, I'd like your thoughts on GPRK. GPRK.

Well, this is Geopark and it's engaged in onshore and I'm sorry, onshore oil and gas production in Chile, Colombia, Brazil, Peru and Argentina. So South America, we know South America, you know, from a from a political standpoint is fairly volatile and they don't necessarily believe in.

You know, property rights from time to time, right? They go back and they confiscate the assets of companies like this. And so when you look at the multiples trading at four times earnings, you know, it's cheap for a reason. But is it too cheap? And I kind of have to say, yeah. You're looking at free cash flow, trading to a month of $471 million. That's more than their market cap. Market cap is $410 million.

Okay. And what are they doing with that cash? They're buying back shares. They do have some debt in their balance sheet. I also like the fact that they're across different countries, right? Because not all of those countries are going to turn sideways politically and try to confiscate the assets. So I like that. So they certainly can pay out that dividend, at least in the short term. Okay. And that dividend has stayed relatively high for a while. So I kind of like this as a...

Foreign stock exposure. Once again, it's still very risky, but I think you're getting enough discount for that risk. So I'm giving Geopark a thumbs up, especially after this pullback. So yeah, GPRK. Now, lastly, let's talk about Doge. And this has been the headlines that the richest man in the world is undergoing a rethinking of spending within the U.S. government.

at the directive of President Trump. It has about 40 people. Many of them are young software engineers, might have worked at some of his companies, et cetera, but most of them have never worked in government. And if you go on the Doge website, it says they saved over $105 billion. That's as of March 2nd, doing things like workforce reductions, asset sales, and contract cancellations. But if you actually look at it though, it's dramatically lower.

One thing, there's been a lot of errors that said that there's $8 billion in savings in this one contract. It was actually $8 million, not $8 billion. So big difference there. And then a lot of those contracts that they have canceled, many of them have already been fulfilled. The judge say you have to pay the work that's been done. Now, some have not been fully fulfilled. They've been partially fulfilled. And those can be canceled. So the savings have been dramatically lower.

In the tens of millions, not 100 million plus. Now, depending on the way you look at it, that might be a good thing. It might be a bad thing. But clearly for the economy so far, it's been relatively minor and it hasn't been hasn't pushed the unemployment rate up dramatically. We looked at the jobs numbers today, right? The federal employees are only down 10,000 jobs, not significant.

Now, that could continue to come. There's been one judge that said, hey, you have to abide by certain laws and certain jurisdictions have been pushed back from the courts.

the unions and some of them have standing, but most of them don't. So, you know, we could make a lot of headway, headway. And they've already gone in 20 government agencies to try to try to cut off workers. And so far about 75,000 workers have accepted a buyout, including actually one of our clients. He's also sent 25,000 termination notices to other employees. So, you know, about a hundred thousand employees have been affected so far, but, uh,

The recent directive by the government is by March 13th to do large scale reductions of the federal workforce. So I think that's what's really spooked markets. That was a executive order that was recently signed. And the big question is how much impact will that really have? If it's another...

50 or 100,000 workers, that's probably not going to have a material impact on the economy. But if it's hundreds of thousands, right, two, three, four, 500,000 workers, that could be a big issue. And, you know, his goal is 10 as a trillion dollars in savings. And he's obviously far from that. So that large, those large scale reductions will have a huge impact on the economy one way, one way or another. And we'll see how that comes out.

Now, I'm Justin Klein. This week's another InvestTalk program. We thank you for listening. We encourage you to tell your friends and family about our free podcast downloads, which you can find anytime at iTunes, Spotify, or Google Play. And be sure to rate and review on iTunes as well. And hope you've heard about our second annual InvestTalk Market Madness competition now underway. And you can win $1,000. And you can enter by heading over to investtalk.com. Registration closes on March 17th.

And if you need help understanding your financial path, your portfolio risk, and your risk tolerance level, I encourage you to head over to investtalk.com and schedule a portfolio review with me or Luke. Independent thinking, shared success. This is InvestTalk. Good night. InvestTalk is a trademark of KPP Financial. Because of the nature of the interactive dialogue inherent in the format of this program, it's important for the listener to understand that not all comments made will apply to them.

Specifically, nothing said shall be taken to be investment advice or shall statements on this program be considered an offer to buy or sell security because such advice is rendered solely on an individual basis and at times will require that the investor review a prospectus before investing.

InvestTalk is a copyrighted program of Klein, Pavlis & Peasley Financial, a registered investment advisor firm which retains all rights. For more information regarding KPP's investment advisors, call 1-800-557-5461. Thank you for listening, and your comments and questions are welcome on our 24-hour listener line at 888-99-CHART.