Beyond Predictions: Brenda Vingiello's Unconventional Market Insights | Buy Hold Sell

[00:00:00] Hey, this is Kelsey Smith, why old cell?

[00:00:07] It's been funny today because everything we've been flying has been gone up maybe since

[00:00:13] today, but there's this mystery out there that are still these loud mouths there talking

[00:00:21] about how there's no rate cuts next year, that there's going to be a respect.

[00:00:25] They've been dead wrong.

[00:00:26] How do they get time on TV and radio, John? November. But what do you think? I mean, can you say soft landing? I mean, this is, it looks like that's what we're going to have. But what's your take? Well, I think the market has certainly clued into that and is expecting that that now is an inevitable outcome. I do think it's been great news to see inflation coming down and get another read up on that next Tuesday. Oil prices have come down a lot. That's really helpful for headline inflation. And I think if

[00:01:43] they stay lower, that'll trickle down into the core number. But I think overall, in terms of the traits. And it's just the first week and really last week, was the first time retail was carrying the market. The institutional looks and feels like it's a little bit filled up, owns enough, and wants to sit back, then retail late to the game, everything obviously from Bitcoin,

[00:03:00] my new favorite stock square,

[00:03:03] my new favorite, some other sectors that have been,

[00:03:07] essentially are getting the rotation This is healthy. This is what stock to do when they go up five weeks in a row. But if you were able to look out six months from now, you're going to see employment coming down. But remember, at the higher end in Silicon Valley, there's only about 310,000 people that have been laid off in the last two years at an average salary of 258,000 bucks. All right, that means some of those restaurants in your hood are going

[00:04:23] to be hurting a little bit or some of the bars. Yeah, I got 17% of my, look at the stock, stock doubles and a half. So that's one of our big themes, this big tech or mid-sized tech, getting reality as to overhead and understanding that earnings are still going to drive valuations with a 4% Kenya. It's been great to see a lot of companies recognize that they have too much staff. But I

[00:05:44] do think one thing that happened, that happened this time certainly if growth resumes and we have a more normalized environment, which I think we probably will as we look going forward, that should mean there's just more leverage to be had in the business models. And perhaps they don't need to invest quite as much. Although I will say with AI,

[00:07:01] that is expensive investment. And so that their you know Advertising platform is built on and so suddenly if search is a lot more perfect Then how do you get those advertising dollars or how do you monetize it? So I do think we're gonna see a lot of change even in some of the larger companies in in the stock market within tech Just as AI evolves because it's gonna change

[00:08:24] You know I use barred google.com the most that's one We've had them on our show many times. Yes. And I have a portfolio of them that I hedge. The actual entromal rate of return, the IRR, is about 48% a year, making some basic assumptions that I hedge for that. It actually is higher. Incredible. But I'm buying, you know, puts some selling call, but, but, but, anyway, I gave that question to, like, myself, and all the, all the, the chat, GBTs, etc. And they all had a different answer.

[00:09:45] So I'll give you the answer. I'll get it back. Well, I think you have to be selective. And I think some of the mega cap eight stocks that have worked so well this year, we've seen, even if you take NVIDIA, poster child for being a beneficiary of AI implementation, okay? NVIDIA's stock hasn't been as well as I think most people would have expected since June of last year after recording some phenomenal quarters. But so I

[00:11:00] think in some cases, some of these stories have played out or in the near term, you know, they've

[00:11:04] kind of reached evaluation top a little bit. But I how long does it take for that piece to come to fruition? And I think that's the question that we're still asking in terms of understanding the total earnings power that could come from implementing AI. Yeah, I would throw in the fact that the idea of having this large language model that costs two or $3 billion to essentially steal all the content

[00:12:22] from the internet, we're going to have a European AI act

[00:12:25] that will be done by the end of the year

[00:12:27] or certainly the first part of next year It's not in any type of way to look at it. And that has to be structured. And that has nothing to do with GBT, number one. And then number two, yeah, if you're micros, which, who's the winner? Microsoft, Google, Amazon, and Oracle, who are the largest cloud as a service providers. And then as they grow in that,

[00:13:41] then who's another big one or another neighbor

[00:13:43] of yours out there is more competition. Well, the one thing we have discovered, here's a great business model. If you own 100 data centers and you fill up with

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[00:17:40] Evolving regulations, technology enhancements, and the meteoric rise in the number of players

[00:17:45] makes this sector the fastest growing and most intriguing in the world. mean to you. This is your host, Eric. Who knows? I don't know what your take is on that But we'll get into that in a second, but as far as sectors are really focused on those non-tech companies What do you think as far as investors or what they should be concentrating on? Sure? Well, I think you know this year You know outside of those large cap tech stocks primarily eight tech stocks

[00:20:23] We really did not see a lot of market participation in any company with debt any company that had a high dividend payment

[00:21:25] in this current quarter is that much of that has been alleviated as we've all decided for the time being that as soft landing is very much a real possibility and that the Fed is

[00:21:30] probably done raising interest rates. And we've seen long-term rates, which have been

[00:21:33] incredibly volatile, go from 5% all the way back down to 4.1% today.

[00:21:39] Can you believe that?

[00:21:40] Didn't incredibly volatile. But it has really supported money flowing back into many of those doing pretty well in the mortgage rates, et cetera. Brendan, I always brag that my business is called transformative research for a reason, because we're looking for transformational events that create these fast growth, fast earnings inflections. And we just hit all time high on our LPG tankers today. Panama can out closes, and I'll be dead gum.

[00:23:02] But now they're cutting down to 25 ships a day.

[00:23:06] And the yields for the day yields on an LPG, You know, certain things happen. And so I'm seeing what Brenda's saying is, I'm seeing some rationality here. And large money matches, again, looking at the large trades, the large volumes have been going to areas that are just splatted. Yeah. You have it up for dead. And, you know, I'm sorry, people are going to continue to bang. People will continue to.

[00:24:20] Yeah.

[00:24:21] We own a Mr. Cooper, which is the largest servicer of mortgages.

[00:24:25] Yeah, when your rates go up, iteeper the fall? Yeah, I think it's healthy for the market to pause. And we have a lot of data coming out over the next couple of weeks and a Fed meeting too. But I do think the other thing that could keep those rally going is the amount of money that has been sitting in money market funds, which is significant. It's almost $6 trillion, sitting in money market funds with people who said, I've had enough. I'm seeing a lot of positives, but not seeing that there's going to be incremental negatives at this point, which sometimes is all it takes in order for money to start flowing back in. Hey, the Italian stock market was a lot of care the last two weeks. Well, that's why the economy, I think, also helpful. It kept coming up on my screen and I was trying to figure that one out.

[00:27:05] Well, that's why we sign that there was trouble in the economy. So I think in a perfect world, we get rates coming down a little bit by mid-year or at mid-year during the second half of next year.

[00:28:21] And then we get a more normalized earnings growth year. household earnings that have been flat. And we got into this third quarter, into the holiday season, and we have this big number on Black Friday, that shockingly, a lot of them are using buy now, pay later. One of my favorite firms, a firm, that just got crushed because it was at a silly,

[00:29:41] silly valuation.

[00:29:42] It came down here to the point it was about 80% down

[00:29:45] from what its IPO was. 60% of American households that are living paycheck to paycheck that you can do it for a refrigerator, you can do it for an emergency type stuff, but it's a good deal. safer way to invest in Bitcoin, that I do think if you look at the RA world, which I am in, there may be more adoption than there is today because today, think that'll just only outlitch it in a CD the asset class. Yeah, I, you know, I've always, I've been very negative on Bitcoin as, as a currency. That's complete part of Charlie Munger and I are on the same. I didn't quite call it.

[00:33:40] It's bad. Many bad names that Charlie Munger calls him. But, um,

[00:33:45] But he's not the only Wall Street pro. it's not a charity. So you have, then you have, you know, my friends, I grew up with a few that, you know, only worth $100 to $150 million from the Bitcoin that they offered me to buy. And I said, you had to be crazy.

[00:35:01] And they're hodlers.

[00:35:02] I mean, most people I know who are in it,

[00:35:04] Brock Pierce is a good friend. a profit and so they're going to basically shut down or they're going to turn into power generators and the big guys are going to mop the floor with the small guys on the mining side and that's going to mean the last amount of Bitcoin. So the dynamics I think are very of dollars in saving. Exhibit A, Exhibit A. And I think they're living their life. What do you mean by trillion? It's a lot of living, isn't it? Yeah, so they're not, they're, yeah, they're not going to, I don't think they're going to,

[00:37:40] they don't care about, they own their home outright. They don't care about what's happening in the

[00:37:44] job market. They're going to spend and live the at six percent plus anymore. So I do think that that's going to be a source of ongoing improvement in inflation. Will we ever get to two percent in a world where we're de-globalizing?

[00:39:02] Well, I think there's going to be some forces inflation and it didn't go, but then we got the dollar going up the bank and then going down. So now we started to get a little gold action. And the rates coming down, I think there's more of a case for gold, right? With gold, there's, you know, there's no yield.

[00:40:20] And then so it's harder to make a case

[00:40:22] when you get around 5% of money market.

[00:40:24] That's yields coming down.

[00:40:25] It's more of a case to be made.

[00:40:27] Yeah, no doubt about that. built, owned, and crude? That's thanks to the Jones Act, which is the bedrock of the American maritime industry. On the American Maritime Podcast, we cover the topics that matter most to the 650,000 men and women of American maritime, while also being accessible for the average listener to learn

[00:41:40] about this industry. Every episode features a new guest, including congressional leaders,