Warren Buffett's Cash Stash: Are We Headed for a Market Meltdown?
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On radio, on youtube, streaming live, on the talk dot com and for our podcast subscribers, this is invest talk, independent thinking, shared success. Invest talk is made possible by K P P financial, a registered investment advisor firm serving clients throughout the united states. Here is K P P financial portfolio manager luke guero.

Good afternoon, fellow investors, and welcome back to invest talk. My name is legal and IT is thursday, november fourteen th, twenty twenty four. And for me it's an exciting thursday. You know if you don't know this about me, i'm a die hard eagles fan and should be a great football game after this show. But before we get to all that, before we get to something that is exciting, we have to get to something that is serious.

And what is serious is trying to interpret how the changes that are happening all around us affect markets, affect the world, affect politics, affect the economy, and through all that, affect how we can prepare for our financial future. Because all of this is important. And because of that, now is not the time to lose focus.

And so with that in mind, the objective for this show, this podcast, is radio program. This youtube channel show, is to help you become a Better and more informed investor. Now in order to accomplished with a mixed of education items, a mix of stories, mixed of important things that we think you need to know about, important material that we are going to cover today.

But most importantly, I wants to hear directly from you. now. We already have some questions that we're gonna answer today, but we really love that back and forth, that communication between you lives, so that we can hear about what is on your mind, what concerns you, what is important for you to know. Now just a bit, we'll talk about today's market performance and run down those show topics that we are bringing to the table. But in the spirit of hearing directly from you, let's tackle this color question now.

Hi, I would like to hear your thought some I N G. Thank you guys for what you do. thanks.

So ticker I N G is I N G group is a global financial firm, I believe, its headquarter in the netherlands. Yet the ted quarter in the neurons. And they do retail banking, wholesale banking, investment banking, insurance, asset management, all sorts of aspects of the banking business.

That's a fairly large bank, about forty billion dollar market cap. If you see on here that numbers different because that is not in dollars. But what i'm looking at here is in us.

Dollars, a forty billion dollars market cap, they have a substantial amount of dead, about one hundred and ninety one billion dollars, and that actually it's two hundred and six billion dollars in debt. And as of the most recent quarter, the earnings have been pretty flat. They're been buying back shares and the division field is very, very, very high.

It's sended about six percent there is projected to be this year. Six point six percent is worth sitting right now. The living in partier has increased pretty steadily, though I guess it's actually can all over the place, right? IT was sixty two cents five years ago and twenty two cents, twelve cents, eighty four, fifty one, one or two project to be a dollar in seventeen since this year.

And the most striking thing thing here is actually you look at this performance, church, it's been pretty weak relative to the U. S. Market over the past five years.

But that's probably because most of its business is coming out of a europe which international socks have not been doing as well as us stocks going into the pandemic and coming out of the pyncheon c, with the U. S. Having really an overall Better recovery than the rest of the world, right? You see twenty nine percent of its revenue u comes from netherlands.

Poland thirteen percent, belgium eleven percent. And then the rest from various countries across europe and also across the globe. And so let's take look the growth thread.

Interesting come up eleven percent and you lize basis expenses up ninety percent, and that means that their totally and interest income is only really grown by about one point two percent. That's pretty slow compared red to a lot of those us. banks.

And because of that, well, they're trading below their book value. Typically, you're seeing U. S. Banks, most large banks are training, write about book values, about fair values. You could say that this is slightly under value, but I would say that one thing that is, is important to me when you're considering financial institutions and and this is one that did have, uh, decent earnings, a decent earnings, they did beat consensus on the bottom line.

But I think one thing here is aside from from from their profitability following a little bit, growth slowing a little bit, the fact that they have a lot of debt on their baLances is that banks, primarily, what are they, right? They taken deposits and they land long, right? They are lending out for various projects.

And for me, I just think that the economic recovery studies has not hit europe in a way that I would lead me towards wanting to invest in an international bank versus A U. S. Bank, which is going to be bank rolling based upon what the campaign said should be bang rolling.

U. S. Manufacturing, U. S. Infrastructure projects. Again, thanks to sense to be seen what actually happens.

But I think that the growth prospects in the U. S. Are Better than the growth prospects.

And actually right now, and therefore, you would likely see a Better return from banks and financial institutions that are bank rolling in lending for those U. S. Focus growth projects with us consumers, us retail banking, us.

As a management. So overall, I think this bank has a lot of debt. And I think this under performance relative to the us market is showing you a trend that is not Stellar.

It's a perform to inline pretty much with the industry of over the past five years. But I just think that if you're looking forward, the theme that's going to drive bank earnings forward, especially the time and interest strates, you're coming down great. We expect that, that they're lower than they were about a year ago.

I think in the long term, they're probably trending to a little more elevated way. Still, you're going to see that interest in can fall down. So I think what you're looking to see, what you should be looking to see is what thematic drivers are going to drive these financial institutions earnings.

And I just think that some of the U. S. Large banks are Better than the european counterparts.

Banks for the call. That is ig ticker. Ig, we ve got a lot of going to cover the next forty five minutes or so.

So here's a sum of what I have planned for you. Time permanent. I may focus point concerns of this warning, warning about its cash stash.

Are we headed for a market meltdown? Workbox are expressing concern over burger hathaway record one hundred and fifty seven billion dollars stockpile of cash. So what does all mean? And you know what? I could could mean a lot of things, but we will die in to that.

We will also touch on a story I tried to bring you yesterday with enough time, but we have time today, hopefully. And that is on copper. And how does IT view the second trump election versus how IT viewed the first also touched on comments made by fed chair Powell.

And what that might mean for rate cuts going forward. And should we have time to the end of the show? There's a new entrant into the AI chip business trying arrival in the video that is amazon.

So what could that mean for the industry going forward? We also some boys think questions ready to play, including one on investing factors and one on well, the company. We're got any questions on a lot recently, that is mci super mro computer of questions, uh, ready to play from our investor to youtube channel comment section.

And of course, I welcome your finance and investment questions now or any time throughout the show. Now I had IT into a short break. On the other side, we will talk about today's market activity and take your questions from the invest. Talk any timeless in the line, you know the number he did eight ninety nine chart.

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Investor now with more than sixty million downloads, Justin line and look arrow are ready to answer your finance and investment questions. Twenty four, seven, eight, eight, ninety nine chart stock a little bit about the market .

before we head forward for the day. U. S stocks finished lower and in near the worst levels, major induced on track to post weekly declines.

The doubt down forty seven basis points, last five hundred, down sixty nine dock down sixty four and fifty thousands, down once again, a big one hundred and thirty seven bases, one that's one point three seven percent toa ys. Other performers included farma biotech, managed care and d oil services. Our performers included entertainment, disney doing well the day, sammi caps airlines asset managers as fee based asset managers, integrated energy, home builders and tobacco.

Treasuries look pretty mixed. The dollar next up forty basis points, crucial up forty basis points as well. Overall, I think the defensive tone was checked up someone to a more pocket ish take away from post comments talk about later, which came on the heels of the firmer ppi number and a jobless claims print this morning. Bond held back up continues that really be driven by multiple factories, right, including equity friendly, positive macrophage moment of chobe disappear, tion traction and more recently, something we talked about a little bit, which is concerns surrounding what a true agenda might have on inflation. But still there's hope for the bulls out there.

Bols still focused on positive seasonal aheads into the end of the year, opening up the buyback window, a reset of volatility and really some foo and heighten retail impulse coming off of the market, reaching all time highs as well as a tail in potentially next year or really know if you expect the latter half of next year for d regulation. And they are going into twenty twenty six with a resetting of corporate tax rates. Lot of fed speak today, paul said, the economy not sending any signals that the central bank really needs to be in a hurry to lower rates, adding the strength in the economy has been given a fed the ability to approach decisions prety carefully fed governor killer highlighted distinct lation trends as well, the rebounds labor market, but its that opposes probably appropriate barkin for merchant in said that uncertainty inflation is one of the reasons for really being more gradual going forward.

With the market data front otobu core P, P I largely in line, the final demand services accelerated slightly, and finally the man goods turn positive after two straight negative monthly prints. On the job side, initial jobless claims came in below consensus, continuing claims online and down slightly week over week. There are still holding near a cycle high.

Now, you know what, if you feel like you aren't getting enough out of the talk from listening, well, you can also be a viewer. And that's because our audio podcast in radio shows a bil in video form on our youtube channel to head over the youtube, go to search box and type invest talk with two teas. And you know what, if you have a question that you really want answered, leave IT right in the comment section, because we like to get to those.

So let's get to one. Now, this ones on deo is the ticker from iraq, dan one thousand sixty four, and says, what are your thoughts on deo? average? Pd, almost twenty nine hundred and thirty.

And next year, earnings about seven seemed undervalued. I understand the trends on drinking, but what do you think at these Price levels? Long time listener pakistan, dawn banks for being the best financial podcast.

I have found what that is very sweet of you to say. Thanks for being one of our one of our best listeners. right? It's to take doo dog o if that is how you pronounce IT dia, geo and IT is a second pull that up here that will die right on IT.

So D H L is a multination beverage company and distribute accord beverages, including beer, wine, spirits and ready to drink beverages. Their brands clue, john y. Walker, Sarah bailes, captain, more than tanker guinness done holy, a very diverse product based across the entire spectrum of alcohol. And so taking a look at this name, not a lot of info here.

IT is a sixty six billion dollar market cap company, and IT looks like its revenue has really flat line in terms of its growth throughout over the past five years, they have grown in about a four four percent clip on the anise basis, but it's kind of flat land. And you're gotta wonder if that is, well, people pairing back on h their alcohol spending, right? Going out to dinner, though not want to evidence within the market that people really pair back that much.

And so is that because there is an a virgin trend of just people drinking less? And I think I think that's probably the case, right? They're struggling in line. AmErica is what i've seen here. The global volumes are down and they've had to drop Prices a lot.

And so because of that, you're seeing Price earnings fall because while people expect earnings down the road to beat less and then they may have expected before, right, they're inking about sixteen times for looking earnings Price to book value, about six point six times as well below their five year average. And so you may be looking this and say, okay, well, it's cheap er has been for a while and sometimes the reason it's cheaper than it's been for a while as because the trends are just not favorable. And IT seems to me to be the case for a company like this.

People are drinking less and so the valuation is falling, growth has flat lined and margins have fAllen as well, down from twenty one percent to nineteen percent, not that big, but still substantial, down for twenty four percent. Prepare demand. And so with all of that in mind, I think that this is a situation where the theme is just not in your favor. And because of that, i'm going to have to pass on the G, O, ticker, D, E, O, never move into break, and still to come in this podcast as radio show, this video series, I will tackle more of your voice bank calls and get to the made focus points to stay with me. And if you, if you want to give me a call, eighty eight, ninety nine charge.

Look, gero is here and ready to tackle your questions. I wanted to .

pick your rain about apple would think about their earnings for is a good time to add to my position.

Cool invest talk A A ninety nine years.

Every investor is working to build a secure financial future. More you learn about how the market works, the Better your chances for success. Investor eighty eight ninety nine chart.

Let's talk a little bit about a little known investor from nebraska that is warn buffett, born about of the world's probably most famous investor, has been building up a significant piled cash at burger halfway, which is some everyday investors wondering if it's a warning sign.

But stocks recently hitting all time highs after Donald trump s election Victory, many are paying attention to buffett's moves to see if they indicate trouble ahead that some market experts aren't so sure that perches cash build up is a red flag. Jc parts market strategies pointed out that above its recent cash increases, having really coincided with market downturns in the past, in fact, stocks have often rally afterwards, suggesting above its move might not be a clear indicator of market trouble. Birches cash, while it's very big, totals three hundred and twenty five billion dollars by the end of the third year from two seventy seven at the end of the second quarter.

This growth this happened even as bircher has sold more stocks and its bought over the past five years, meaning IT missed much of the post COVID market round. And so you may be asking yourself, and you know, you're not alone. A lot of people are, why all the cash now? Well, there could be several reasons.

One possibility warned about IT is ninety four years old, right? Meaning that IT is likely if he wants to do another big deal. He has one big acquisition you can make with over three hundred twenty billion in cash.

You could buy buy outright coca cola. You could buy golden sex out, right? Maybe he is gearing up for one giant deal with.

The potential explanation is that buffer may be preparing to transition out of active management, right? This is my I bought this. This here is that he's ninety four.

He would eventually, probably in the near term, stepped down from richer health way. I don't think he's in any rush, but still he's gona step down. There is going to be a successor.

And so get successor is going to want to reshape burch's portfolio for their tenure. And so having that cash position would give that person that opportunity. And so I think is best not to read too much into this, right.

There are logical reasons for his actions beyond concerns about a market downturn. This may feel unsatisfying for investors who are trying to read the tea leafs and who closely follow of its every move, but strategy isn't really always directly relevant to the average investor. His approach is a ninety four year old billion air managing a massive conver is understand different from what works for somebody managing their ira or they're for one case.

So while it's tempting, it's tempting to view of its actions as a signal is cash pile omy simply be reflecting birches need for liquidity flexibility or launcher planning rather than an impending market warning. And so for now, the oracle of omaha's moves continue to intrigue if their meaning remains uncertain. Keep things on movement and head back to the investor list or bank.

I don't have a lot of time each day to study and digging, like I know is necessary to really understand your program has helps a lot. But my question is this, basically, if you were in the situation of not working in the field, you do another.

If you were not a professional investment advisor and we're limited on time, how would you pair IT down one of the very minimum basic things that you would want to study to understand before making a stock investment? I know there's a lot of factors, and you do this professionally. Thank you. And you have a great show.

Keep IT up well. Thank you for being a loyal stener. Appreciate that. And that's tough. That's really tough for I think I go back to what drunken miles which is and I could be getting the percentage is wrong, but the general feeling in consensus and ideas the same.

And that is a majority and fifty sixty percent of a sock return is how is the whole market doing, which is easy to believe that the most important aspect is understanding what themes are being driven globally. If you don't have as much time to drive into dive into the muncie individual companies, you need to understand what factors are shaping the political and economic landscape and how that might affect the market positively and negatively. The next larger slice, probably another twenty thirty percent, is the sector, right?

Most of the market is going appreciate together, but those things that are driving on a more microscale within the larger picture are what's going to help various sectors. What how cheap is IT to raise capital? Are people looking for bond proxies because bonds are falling in and they're looking for income.

Is that going to shift IT towards utilities? What is the path of interest strates? How does that affect real state? All of these things are going to primarily drive sectors together, meaning that eighty, ninety percent of a stocks return isn't even about that individual company. And then when you have all that time on your hands, then you die into that individual company basis.

What companies have really strong motes, what companies have products that are difficult to replicate and you can't really differentiate from on Price or quality, right? That's that's the core of what's gona drive a business. Yes, it's baLanced is incredibly important. Is IT levering itself too much? What is going on fundamentally with the company is important.

But generally, if you have a well run company, the ones that are going to do the best of the ones that have products that are not easy to duplicate, that are not easy to replicate, that are not easy to beat, whether aren't really those threats, these economic motes are what you're really looking for in terms of those individual companies. But you know what, you gotta start to start the top. You got to understand what's going on with the world and how that is going to drive markets forward.

Now the next invest talk, we will look into this topic. Five of central financial moods to make a four, twenty, twenty four and max ized retirement contributions. And reviewing your investment strategy are just to the vital tasks you should complete this year and really every year. But you know what why we but tomorrow but for now, i'm look arrow and i'm ready to take your calls at eighty eight ninety nine short.

Got a question for Justin or look, you're the best person to ask IT.

I wanted to pick rain about apple. What do you think about their earnings .

time to to my position? Eight, eight, ninety nine chart.

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Your questions are free. The answers are unbiased. Look, gerardo is here now, ready to take your calls live. Investor, a eight, eight, ninety nine years?

yes. I S, I dip below eighteen dollars today. They still have a partnership with an invidia that they initiated an october, I believe, for that storage.

They have not any comments about the ten k failure and department of justice is investigating them. I think for accounting manipulation, this kind of a value way down here might be a good place to pick IT up. I'm just interested to see what your thoughts would be gone that and I will listen for your answer on the program. Thank you very much. byebye.

So sz I super microcomputer, they offer stored system server rack technology. And we've got a couple calls about this in the last couple months. I think the first call came may be around forty five around here, forty five, fifty, and we said no.

And then I think we ve got the last call couple weeks ago and that he is trading around twenty five, twenty six. And once again, I said no. And now that it's trading at eighteen dollars, i'm still saying no.

And the reason why is because, well, that deal in the video looks like they started diverting orders away from S M C I because there's a potential delisting on the horizon. There's A D O, J investigation. There's legal trouble.

There's accusations of accounting fruit. And one of those things alone is probably enough reason to stay away from this sky. Anytime there's a fat allegation, anytime there's a potential criminal investigation.

You are looking at outsize risks and the areas of the market that you can invest in that can give you the same type of exposure to the A, I play that S, M C I was. And so redundancy, for the sake of clarity, when there's frag there, potentially when there's a criminal investigation, stay away. That is a super micro computer.

S, M, C, I. Now Donald trump's recent U. S. Victory election Victory hasn't really ignited the same rally that we saw for copper back in twenty six. Want to take you back where in twenty sixteen trumps unexpected when caught.

Well, pretty much everybody off guard right to got the market off guard and IT LED to a rapidly element of copper futures and options this time around. IT was a closer race, right? right? There was a fifty, fifty.

We did not know who's gonna in, but we could say he was pretty much going flip. And because of that, copper was already in risk off mode. Fund managers holding held only modest log positions on copper ahead of the election.

Interestingly, market focus wasn't just on the U. S, but also on china, which had its own major event last week, the meeting of china's national people's congress standing committee, where investors, investors had hoped that china would announce roby stimulus measures. Well, what happened? Well, instead, the committee unveiled at one point for a trillion hour package aimed at easing local government debt.

But I didn't really live up to the metal balls expectations of a vast stimulus that could stimulate demand dramatically and broadly. So doctor copper, which is often viewed as a bell weather for economic health, now fixes A K question. Could the prospect of U. S.

Terrace on chinese goods prop china to implement stronger stimulus to support its slowing economy? Folding the election directly, copper initially took IT took a hit to drop four point one percent on the london metals exchange in reaction to what has been a seismic rally in the dollar. However, couple Prices they rebounded pretty quickly, right?

Traders started betting that the threats of terra s could push china to simulated economy even more aggressively. Yet on friday, after china anounced dead, restructuring plan for local governments abolished, rather, they when they announced this plan that really dash the hopes of people expecting a broader and stronger plan. Carper closed at nine thousand four hundred and forty three dollars per metric ton, down one point three percent for the week.

And despite some volatility, the overall market reaction was much commer than in two thousand sixteen. And so looking ahead, the path of copper remains uncertain. I still think that for industrialized manufacturing, bring that back on shore, right? Coppers, an important industrial metal, but there are some factors outside of the control that means that the path is less certain moving forward.

Trb is promise hair so much, sixty percent on chinese imports, but these really would even take effect for several months. And in response to china's rising exports, the by administration had already raised or duties on chinese limit on steel, with canada, mexico implementing similar measures. But imagine this the other day, right the first time we had trade tensions.

Chinese economy is stronger now. Chinese economies a more vulnerable position today. Then I was eight years ago, making IT a highly sensitive to these potential new terrace and could disrupt chinese demand.

As a result, the initial market reaction has really refocus competitors on what china is going to do next. And so for now, metal balls hope that a change due administration might lead to more practice stimulus measures that could bring back what has been weaning chinese demand. So like, we got another question lined up and ready to go from our invest talk youtube channel.

And this one is about taker fl r. IT says, I put a lot little, excuse me, I put a list together of a Russell, two thousand companies, most of them industrials, very bullish for the of these stocks on my list. And I want to build up a substantial position in this sector.

I question today is about fluor ink. That is flu. O, R. Take her. Fl, r.

And what are your thoughts about the rules of two thousand will brought and then get narrow. And the russia two thousand is a small cap index. IT does a good job of delivering the small cap.

Ask class why? Well, IT is less subjective than the sp small cap indexes, and that there is not a committee selecting them. And then they do a number of names approach, right? They rank or the U.

S. Market by three thousand names. Top three thousand names, guess what? Top one thousand. And call that large caps, about ninety percent of the market.

Bottom ten percent, which happens to be two thousand names that can be smoke s and so IT is a good job because IT does IT in a replicable replicable way, an understandable way, and you understand the index construction methodology. And IT doesn't make active p pics right, like a committee selection does. And so it's good way to look at the U.

S, A small cap market. So let's take a look at fl. r.

That is, floor flor corp. Is a industrial name. They have really a big hand in sustainable energy solutions.

They use liquid nature. Gas is a big part of them. They produce rather fuels, chemicals like the financial gas, nuclear power service games.

They're pretty diversified. Actually, more than I expected. Seventy percent of the revenue comes from north america, fifteen percent from europe, seventeen percent from places side of north amErica and europe.

Looks like their energy products make about forty one percent of their revenue. Their urban solution focuses more on cities rights. Urban planning makes up about thirty four percent of the revenue.

Now grow this down, right? They fall in from five years ago where the revenue is about thousand nine hundred billion, down about sixteen billion this year, although that is some growth coming out of the pandemic there. They bought about about twenty twenty one, where the revenue reached about twelve billion dollars.

And so they have been growing sense. Then let's take a look at there. Let's take a look at their margins. Where I return on assets has has grown projected to be about six percent this year, up from two point nine percent last year, is actually negative back in two and nineteen.

And the next margin has improved as well from five years ago o one point two two about two point six this year. Now it's an eight point six billion dollar market cap company, so that is made small and mid cap name one point one billion to death. So not too much debt and cash flow improving.

Like I say, profitability ties improving. They do not pay divided. It's pretty wrong relative to the overall market. And over the past year, it's climbed from about thirty five dollars a share, picking out close, closing in on sixty. So it's about fifty dollars per share now.

And so with all this in mind, how do the relative valuations look? Well, three point eight Price to book over that five year average Price of cash flow ah looks like a little skill there. So we won't really look at that Price sales also reaching that I near that five year peak.

And I think this is likely to take a little bit of a hit just given how much of IT was involved in sustainable energy solutions. And we know the priorities of this upcoming administration, but the explosion and natural gas explosions red a nuclear power. I think that's pretty bullish for this name now you to date to have almost thirty percent.

So IT has had quite the run up, but still looking at its Price to book value, IT looks IT looks relatively cheap. They are more expensive than it's been over the past five years, but a lot of that's going to be covered by the pandemic. And so I like the theme here.

We definitely like industrial names here to invest talk in a kv p um and so for F L R, that is a fluor corporation. You know what I like IT. Thanks for watching.

Looks like we got plenty of time before we head in to our next break. So why do we play another question? Now my .

question is on ticker G, L. P. I did a screener and this comes up on a and it's in the casino hotel business. And I was just wondering what you think about IT and with good support level to get in already own about happy position.

Thank you. So a ticker G, L, P, I is gaming and leisure properties ink. And you know what? That does exactly what you think IT does.

IT invests in acquiring financing, owning real seat properties that are tied to gaming and also to leisure. Now IT is a fairly large reach, about thirteen billion dollar market cap. Pull something up over here. So a bar or with me.

So what I was performed, you dated down about one point to eight percent, down about one point seven three percent, down seventy five basis points in the rates have not been doing particularly uh, well relative to the overall market as the you know longer term bonds have ticked a little bit higher, bonuses have take a little bit higher, has been a borne to sell off.

And so taking a look at this company, right, seven billion, thirteen billion dollar mark company, about seven point six billion in that a lot of reader finance by debt, but IT also issues uh, tony shares, up from two thousand ten million shares to two hundred and seventy million this year. Now I know why you're probably into this name. The divided yellow is pretty high right now.

About six point two percent is where we're looking at for this year right now, and that's pretty in line with where IT has been now the pair issue is one hundred and four percent, meaning there is not a lot of room for air here. But you know that's how reads are right. They tend to have higher pair issues because of the tax consequences of not paying out all of your dividends.

Now with all of that in mind, earnings have been upgraded. That is something we certainly, like you're yield, like I said, is very attractive. Their baLance ed is surprisingly strong, especially for the business it's in.

And so I would say that with regards to other reads, I think the area of glp I is a good one, right? I think that storage reads are good. I think that gaming leisure property reads, gaming and leisure property reads are good as well because it's a pretty sticky business.

Let's get their geographic uh, breakdown here. I would actually can get a property on the songs that's pretty interesting. But all the revenge drive from the united states.

So we can't really dig into a dig into that there. But either way, you see some pretty solid growth here. You're going back five years, right? Even in the patent of the revenue was pretty solid due to those leases.

And so you see that solid growth even at a time where well, the interest rate path is uncertain. I think if you're going to look into two rats investing in rats, those ones that I mentioned are solid ones to invest in, including G, L, P, I. Now there's invest talk and now more with now with more than sixty million downloads or work will continue in thirty seconds. So hang on.

every investor is working to build a secure financial future.

Would this be an opportunity time to get into .

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your assessment of blackstone incorporated .

twenty four seven rain or shine invest talk is made Better by the power of you eight, eight, eight, ninety nine chart this way.

Look like turkey. How about the banking sector? I'm looking at the sign bank court symbol C I O N. If we could look that, if everything you say that as why I shouldn't at this Price, that really good. Thank you.

So so zon, a bank corp. That is, take your Z I O N, is exactly what IT sounds like. IT is a banking company of financial service company.

They offer banking investment service, this financing, mortal ices, esco services, foreign currency services. They are a small middle market bank right there. Market cap is about eight point eight billion dollars, about three point six billion in debt on their baLance sheet.

And the division field is hovering IT, about three percent right now, which is where it's bit over the past couple years. So that's not really a distressing sign there. Now as have a lot of banks done, one of that sense dramatically works.

But the spirit is still the same that as banks have done one over the past year, right? And they're particularly done where year to date up thirty five percent, up sixty eight percent coming out of the time and a little scare from silicon valley bank. But I think this comes down to something that we actually talked about.

The K, P, P. is. If rates are generally trending higher, have a lot of the facilities that have helped our regional banks are unwinding.

And if there is a lot of commercial debt, which tends to be concentrated, right, commercial listed det tends to be concentrated on these banks, these regional banks and way more heavily on their baLances that's coming to right within the next year or so couple years. Regional banks have outsize risks compared to their larger bank counterparts. And so even though this baLance he looks pretty solid, right, they're buying back shares, their cash lows improving, the profitability solid.

The return certainly over the past, you have been good. It's trading out evaluation well above the five year average. And so because of that, I would probably not think that this is the time to buy again.

I think that within the banking sector right now, given the dynamic, I would tend to tilt more towards those larger banks with more diversified asset bases. And so because of that, because of the real evaluation here, because the run of its had zion's bank corp. Z I O N, that's a pass. Thanks for the call is i'm luk rea, and we have one goal here no matter if it's me or Justin, and that is to help you achieve your financial freedom. Our continues after our final break to get your questions in now at eighty eight ninety nine.

Look, gero is here and ready to tackle .

your questions. I wanted to pick your brain about apples. You think .

about their earnings eight, eight, ninety nine chart.

No two portfolio are alike, and every investor has a unique set of circumstances. So don't forget to call invest eight ninety nine.

Have your opinion on buy is etf for a long term investment? F E N Y S E N Y. Thank you so much.

So ticker F E N Y is the fidelity msci energy index etf. IT was actually the first sector etf that fidelity made. What they do is the at top looks like the have a top heavy portfolio news energy segment with well over half of its portfolio weight in its top ten holdings.

And the top of ten holding are exactly the names you would expect them to be. X on mobile, shaver on conquer, phillips waves coming is one oak. It's an energy etf.

And therefore, IT is all energy names. A lot of its revenue comes from the U. S.

About sixty four percent of its revenue. It's pretty heavily weighted towards large caps, though IT is tracking its style. Uh, a rather sector 那 E T start sector index a pretty， pretty well.

And no, I think this comes down to a two baLance. This question, right? The expensive issue, here's about eight basis points, a large fund, about two billion dollars.

And so the answer to this question comes in multiple, multiple respects. The first is, is this fund a good way for tracking the energy market? And I think it's probably fine, right? It's it's very top heavy.

It's going to give you a lot of exposure to those large caps in twenty two percent of IT in exon, thirteen percent of IT in in chavanon. m. Maybe you would want a more diversified name that doesn't have sixty three percent of its of its holdings in the top ten names.

But I think the bigger question is, is now good time to get into energy. And I look the opinion that I know the energies is an under way. I think energies is a market way right now. Um I think that a lot of the bluster about increasing energy production and subsidizing energy production, all these things like we are at a point now where, well, a lot has been done and x on themselves are saying that we are kind of of a happy medium here. And so I would put IT more a market weight.

But if you want to invest in a company that is rather in an etf that is going to not have any caps and be heavily tilted towards lot of these oil names, I think this is a perfectly fine way to do IT. Thanks, the call. Now before we head off, i'll talk little little about fetal reserve chair drone pow, who seated on thursday that with ongoing economic growth in a strong job market, there's no rush to lower interest strates inflation remains friends two percent target public believes it's una sustainable path towards the goal.

This suggest barwon costs could stay elevated for longer impacting households and businesses. Power emphasized that while the fed aims for a neutral policy that neither slows or speeds up the economy, difficult to define what that neutral weight rate will be in today's environment, a lot of factors is going on right terms. Potential terrorist s tax cuts, immigration policy could all shape economic growth and inflation moving forward, and so the fit is naturally cautious about speculating without too much concrete evidence of what policy action will be.

The chair noted that the economy is currently not showing any distress signals, so there's no need to rush into rate cuts. In his words, if the data let us go a little slower, that seems like a smart thing to do. And so he highlighted the us economy strong performance, mentioning a low four point one percent employment rate, unemployment, right, rather solid growth at two nine percent, and robust consumer spending.

Business investment is also up, driven by rising disposable incomes. But still, inflation remains a concern. k. Inflation measures like the personal consumption expenditure index indicate the corn flakes, excluding food and energy, rose at two point eight percent last month, working a fourth month with a little progress and bring IT down.

The headline PC the effects preferred inflation measures estate around two point three percent in october, about its two percent target as well. And so traders are still bedding that a quarter rate, quarter point rate cut the the december meeting is more likely. But how caution that will this inflation continues, policymakers are carefully watching to ensure days on track.

An important no one asked about trump's campaign promises to avoided speculation, saying that any impact on inflation or growth will only become clear once policies are enacted. He did, however, imagine that today's economic conditions differ from when trump began his first term, with current inflation and product tivy both higher. And so for now, the fed is really in a way and simo, they are balancing these disinflationary goals with the economy steady performance.

Lastly, power stress that inflation is running much closer, two percent go, but hasn't quite reached IT yet. And so IT is investors wait december's meeting fed cautious stance hints that any adjustments in interest strates will be measured and data driven with an eye on maintaining economic stability amid st likely policy shifts. I look gero, and this completes another invest talk program.

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