Great Expectations?

Dano:
[0:03] It's Friday February 21st 2025 and you are on the market with Chris Sipes CFP and sitting in for Daren Blonski myself Dano we are the marketing director for Sonoma Wealth Advisors chris this is going to be a super easy show today because nothing has happened this week totally dull week no activity in washington so i'm ready to just cruise yeah

Chris:
[0:28] Well Daren and i used to joke that you know he wasn't allowed to go on vacation

Chris:
[0:33] because whenever he did the market went down um and the last thing the.

Dano:
[0:38] Last vacation he took was that flash crash in august

Chris:
[0:42] Yes so don't worry everybody there's nothing going on it's just Daren's on

Chris:
[0:47] vacation so this had to happen.

Dano:
[0:49] We're going to take a look at the market and some great expectations perhaps that have been in play this week. But first, this. We'll be

Music:
[1:01] Music now chris rare is it that i've got more knowledge on on the markets than you on something but i get to set up this meme because i know zoolander buddy i know zoolander very very

Dano:
[1:30] .

Chris:
[1:45] Well okay i was hoping you would because to be honest i'm a little embarrassed to admit this but i did not know what this was referencing i just knew that you probably would and so i threw you some red meat so oh.

Dano:
[2:00] Just for me just for me

Chris:
[2:01] Yes go ahead.

Dano:
[2:02] It's amazing movie in the late 90s i think it was 1999 zoolander ben stiller owen wilson uh will ferrell and it's a it's about how ridiculous fashion culture is and if you don't know these pictures uh owen wilson and ben stiller are Hansel and Zoolander. That's their character names. They're rivals in the movie, right? And so they're always, for at least the first half of the movie, spoiler alert, they become friends. The first half of the movie, they're always like, they're squaring off and they're having like a fashion off. And this is so funny because so what we're looking at, we've got Zoolander is gold and Hansel is, I bet. And what I think this is saying, Chris, is that you sort of got two, call it alternative asset classes that are sort of squaring off right now. Is that what I'm seeing?

Chris:
[2:54] Yes, that was what I was assuming, you know, based on the person who posted this meme, which was Eric Balchunas. And I think, so the theme this week is great expectations, because I think one of the things we want to continue to hammer home is that the investment market works based on expectations and how those assets and things turn out relative to expectations.

Chris:
[3:25] So a way I like to think about this is kids, right? And if you don't have your own kids, you've probably seen this play out in other families where you've got, say, the same parents and they've got three or four kids. The kids act differently. So the expectations for, let's say, they've got the one kid who's always turning their homework in on time, maybe skipped a grade, you know never does anything wrong their expectations are very very high so anytime you know they do something wrong everybody's devastated because the their performance relative to their expectations was way off right and then vice versa you got the kid who's like you know you're afraid to take them anywhere because they're just gonna you know who knows what they're going to do, right? And then they surprise you. Yes, behavior issues. It's just one thing after another. And hey, they act just basic and normal, but relative to the expectations you had for them, it was a huge win, right? And so markets work the same way.

Chris:
[4:34] A lot of times people say, well, that's a great company, of course, but the expectations of the market is that that's going to do great. Now, I think one of the things that I personally think you want to look for is assets that are doing well when the expectations really aren't there, like nobody's really talking about them. And to me, gold is one of those where it's had an amazing year. It's had an amazing five years. Still, nobody's talking about it. Nobody's really flowing money into it. Of course, everybody talks about Bitcoin. The expectations for Bitcoin are super high and gold's like this forgotten, like who really cares, right? And so there's a theme, I think, of that in the asset markets right now where you're starting to see some of these asset classes that really had no expectations doing pretty well while the assets that have very high expectations are starting to struggle a bit.

Chris:
[5:37] I think this is also really interesting, Dan, where we are pretty close to all-time highs in both the S&P and the NASDAQ, so the main U.S. Markets that not only everybody in the U.S. watches, but also people globally. We're very close to all-time highs, 1% or 2% off, and yet the bearishness is really high. Um and that's that's not normal normally when you're hitting price highs um you're seeing bullishness highs you know everybody's excited and happy um and over these last few weeks that's not been the case there's been a there's been a bearishness in the market in the sentiment uh the cnn fear and greed index is down to 36 which is fear um that's down even from 44 fear of last week. Bitcoin's up to 55, which is just past neutral, so it's really not too much. But you and I were talking before the video that we've had a lot of people, just anecdotally, clients reaching out like, hey, I'm worried about what's going on, what I see in the headlines. I'm worried about the markets. What do I do? And I think that's fair. That's always fair. There's always going to be things in the market. There always have been things in the market that we're always afraid of.

Chris:
[7:01] It's a tempting thing, I think, to think this time is different because we're experiencing it and it's not a historical experience. However, I think these things have happened before, and it's a reason why professionals, investors, tend to say they preach diversification because you don't know what's going to happen. Bull markets happen all the time when you didn't expect it. Bear markets happen all the time when you don't expect it. It's the, it's a, you know, that's the way markets work because if everybody expected a bear market, everybody would just get out. If everybody expected a bull market, everybody would just get in, right? So diversification is an aggressive strategy because you're, you're going to catch the up markets. You're going to catch the down markets, but not in a way usually that,

Chris:
[7:57] that creates, you know, huge whipsaws. So staying diversified is your best defense against market turmoil and against missing the upsides.

Dano:
[8:14] Yeah, but it's also boring. I mean, come on, Chris, I want that. I want that one thing. I want to ride that rocket ship and it's going to go up, right? I mean, nobody wakes up in the morning and goes, gosh, I really want some bonds today. Things are going well and I could really go for some bonds right now. But gosh, you might like those when perhaps we feel like we're at an all-time high and it's about to fall.

Chris:
[8:39] Right right you don't go to the party and say hey dan how's your fixed income portfolio doing these days uh it's not not gonna happen right um so we got my.

Dano:
[8:51] Cd just matured and i'm a little

Chris:
[8:53] Loving it yes yeah what are your rates on your money markets these days wow um so we saw.

Chris:
[9:05] Well, we saw a sell-off in markets today, and that was possibly due to really anything. But one of the things was consumer sentiment came in lower than expected. So again, relative to expectations, it was lower. The consumer sentiment came in at 64.7. and the consensus was closer to 67.3. So I think it's interesting. Look at these numbers. We're down where we were in the great financial crisis. We're down where we were at the beginning of the bull market in the 80s. We never got an official recession from 2022, but there are so many numbers under the surface, indicators, different markets where, If you were just shown a chart like this and you didn't know that the stock market was near an all-time high, you would say, oh, geez, we're probably in the doldrums, right? And consumer sentiment is one of those. We saw a big reversal in consumer sentiment. Inflation expectations went up quite a bit, maybe due to the tariff talk. I don't know.

Chris:
[10:26] But that slowed down. And then we had the global services flash PMIs, which is like the preview of what the PMIs are going to read. The purchasing managers index came in at 49.7 versus a consensus of 53 with 50 being the expansionary line. So above 50 is an expansion. Below 50 is a contraction. And we got 49.7 on that services PMI. And on the composite PMI, we're at 50.4. So just barely expansionary. So, hey, look, markets are made up of people, and how people feel is very important. It doesn't drive everything, but it does have an impact. And those are some numbers that didn't come in so great today, on Friday.

Dano:
[11:20] Chris, I wonder if you could tell me, because I know last week, CPI came in last week, and I know that it was hot. So that was one thing. And now we've got consumer sentiment. Consumer sentiment is measuring what? Is this a poll? Is this a, this is one I've, I've seen the headline of a lot this week. How is this measured? This number 64. Do you happen to know?

Chris:
[11:40] It is a poll, and it's run by the University of Michigan, and it has been for a long time, and they survey people. Now, a lot of people say that this has really lost a lot of its efficiency or effectiveness because it's become extremely political. So if you poll uh democrats they're they're in the the you know the absolute uh everything is awful markets falling apart if you if you poll republicans things couldn't be better and so it's literally like two different two completely different perceptions of what's happening um and that's developed you know over the last few years so a lot of people are saying hey these sentiment, you know, polls aren't really, aren't really useful anymore.

Chris:
[12:30] Um, now this is from Liz Ann Saunders and maybe a reason why inflation expectations are going up. Uh, this is, uh, she says there are more cars imported from Mexico than the next two countries, South Korea and Japan combined. Uh, that's not something that I knew before I saw this chart. I would not have expected that. And, uh, you know, we Americans have a love affair with cars, that's for sure. Um, you know, uh, a lot of people take six, seven years to pay off a car, eight years, whatever. We, um, feel the need to have new cars every couple of years. Um, and so it's going to be a major, major purchase item in addition to houses. So if, um, you know, outside of a house, probably a car is the second biggest purchase for most families. And, uh, that could be a big driver of those inflation expectations moving forward is, hey, if we're going to be paying, say, 25% tariffs, or if we're in a global trade war, that car is probably going to be more expensive than what we would have expected to be a year ago.

Dano:
[13:39] Right, and I think something to consider too, I can't see the methodology per se, but if a car is created by Daimler Chrysler and it's Hacho in Mexico, is that really an import? You know, I mean, it's an American car, which would speak to, not getting political, but that would speak to why some of those tariffs are, that particular party is looking to enact those tariffs as they're trying to get that business to be made back in America. So that would be their goal. Um, but this is, I don't want to say it's misleading, but it definitely the, the, there is not a Mexican car company that's creating cars that is, these are American companies making them in Mexico.

Chris:
[14:22] Yes, yes, absolutely. Or at least parts. Right. So, you know, I thought this was interesting. This is, um, from bank of America via Mike Zaccardi. Um, the, uh, you know, with all the headlines out, uh, regarding the government, um, And, you know, the government cuts and everything through Doge. And we've talked a lot about, hey, our debt to GDP is not sustainable. Our deficits are not sustainable. We've never run deficits like this outside of recessions before.

Chris:
[14:56] You know, so the US government's financial situation is a concern. Um, now, uh, Darius Dale was on, you know, with macro voices this week and just talking about, Hey, they're not going to be able to cut that much because when you look at what we actually spend money on about two thirds of it is this mandatory spending that you see there at the bottom, Medicare, social security, um, you know, uh, veterans affairs, et cetera, education, those things, that's where the bulk two-thirds of the money is. And then the other large piece is defense and interest payments on the debt, two things that you could argue, like, can we cut a lot there? Maybe, I don't know. Maybe there's some waste in defense, but you can see that's less than a trillion dollars of the total spending as well. So out of our 1.8 deficit, we're spending more than we're bringing in, and we're doing that at a time when markets are doing very well, and the economy is doing well, so tax receipts are higher than they would be in a recession-type situation.

Chris:
[16:11] Where are these cuts going to come from? because I think in theory, it sounds great. Like let's cut, let's cut. But usually people get a little, yeah, but I didn't think you were talking about that when you start talking about your thing, right? Right.

Dano:
[16:28] Yeah, and I think the number that's been floated around for Doge, for that department, if it is a department, is $55 billion, which sounds like a massive number, until you compare $55 billion versus that red box there, in which that's a tiny drop in the bucket. So that doesn't even get to the 0.1 category, that doesn't even get to the 10th category of the 1.8. So um who doesn't who doesn't love the idea of quote cleaning something up whether it is or isn't um but if there's this if if you're thinking that elon is going to eliminate that red box by finding all of the waste that's not going to happen at least not this year

Chris:
[17:22] Well there we've been building we've been building this beast for a long time and you can see this goes back decades and you know biden was definitely not the first president to to uh deficit spend um he's definitely not the first one to add to the to the government debt it has basically been doubled under Bush, under Obama, under Trump won. It was doubled again under Biden. So it's been added to by each party and it's been added to over decades. So this again is from Bank of America showing the US government expenditures as a percentage of GDP. And you would think World War II would be you know kind of the high point i mean we're literally fighting a world war an all-out war um and yet that's really kind of quaint compared to where we were in covid and you see the overall trend line i mean we've just we've built a uh a monster and and taking taking uh control and making changes on something like that without uh especially doing it quickly i think is is that's a tall order. It's going to be really difficult now that it's so intertwined with our economy, with the global economy, with global markets.

Chris:
[18:45] Doing so quickly is really tough. I mean, this is something that's going to take some time when you look at the.

Chris:
[18:54] Expenditures that we've built up over time to get to where we are today.

Dano:
[19:01] Chris, I just want to say first and foremost that I can say with certainty, and we rarely can use the word certainty when talking about the market, but I can say with certainty, Chris, you were the only stock market show with a slide with the Civil War mentioned on it this entire week. Congratulations for that. I'm not – I would expect no less of you, and this is really great. This is a really great perspective.

Chris:
[19:30] Yeah you know me i'm a sucker for any chart that goes back into the 1800s they usually they usually only go back to the 20s um and 1920s so when they go back to like the 1820s or even to the 1700s oh i'm in i want to see that chart i want to see that chart now initial claims, really haven't budged yet. Now, this is a three-year look at initial claims. And we're still in that 220 range. The reason I couldn't go back further is when you show the chart, including COVID, it distorts the whole chart to be able to tell, is this kind of normal? I would say in terms of initial claims for unemployment, it really hasn't, you know, these cuts that are coming through haven't affected the data so far, right? So, you know, you wonder, are the headlines what's actually happening or not?

Chris:
[20:31] You know, these days you can't really tell. And at least so far with the initial claims, they're not coming through yet.

Dano:
[20:43] I think something to keep in mind, I'm glad you mentioned headlines. I've got some key words, I think that are great trigger words to watch out for when it comes to headlines in the markets. Any headline to me that says plunge, dip, crash, slide, as soon as I see those headlines, I just immediately start turning off any emotion or really take it very seriously. Because there's just this casual note for an investor. Muse Media, as we've said many times, is designed to whip you up into a frenzy to probably make you buy the Heartburn product that's also on sale on that same website page. So just a note to take all the headlines with the biggest grain of salt you can find.

Chris:
[21:32] That's so true. I listened to a great interview this week that I really want to highly recommend for anybody that's interested in diversification, which I'm sure there's maybe one person out there. Uh, it was Larry Suedro on the excess returns podcast. Um, and Larry is, uh, he's an investment professional that's been around for, for a while, written several books. And, um, you know, he talks a lot about the, the history of the markets and why it's a very logical and smart thing to be diversified. And one of the things that I guess I knew, but I was shocked to kind of hear it was the S&P has spent roughly a little less than half of its time historically with zero returns.

Chris:
[22:26] While the other half was what generated that average return of 10%, call it roughly, in that range over a hundred year period. So very rarely does it actually hit that 10%. It's actually about half the time it's zero or negative. Um, and the other half of the time, it's multiples of 10, right. To get that average. And so he talks, that's why he's, he talks about, look, there's these, there's been historically many, many times in history where the S&P has done very, very well for many years in a row. And then there's been many times where it's done very poorly for many years in a row. Right now, I would say that the S&P has those great expectations. It is the kid that everybody expects to go to Harvard, go to med school, you know, all the yada yada. I think that's still like the expectation of the top kid. I.

Chris:
[23:29] And those expectations are priced in. So this is from Bank of America. Again, there's a lot of good slides from Bank of America this week. And they say, is the S&P 500 expensive? Statistically speaking, 19 out of the 20 metrics given emphatic affirmative response. Now, to be fair, they said the same thing in 2024. And 2024 had a very good year. So timing these things cannot be done. I'll repeat that. timing these things cannot be done just based on valuations in the short run. But historically, in the long run, they've tended to mean revert because, look, sometimes that kid ends up dropping out of college and touring with the Grateful Dead or something. So they don't always go to med school and finish off, you know? And, and so, um, when, when the perfect outcome is already priced in to me as an investor, that's when you say, okay, maybe, maybe I should be looking at some other places where, uh, you know, let's, let's invest in, Hey, if that kid just acts normal, that's a huge win and we're all celebrating. Right. Um, so anyway, end of rant on, on that.

Dano:
[24:49] Well, I think you reiterated there several times. Timing these things is not possible. Timing these things is not possible. And so what that means to me, you mentioned last year was a pretty good year for the S&P. 24 was a pretty good year for the S&P. And yet there was so much, quote, uncertainty last year because of, quote, the election. So someone could have said with those pieces of information, I'm going to sit this year out until things, quote, calm down. That's a very common thing that people say. It's a common refrain. Well, you would have missed out on a pretty good year in the S&P. Well, that's easy to say now looking back. Think about that now today for 25 looking forward. Yes.

Chris:
[25:34] That's exactly right. Right. And the flip side of that is also true. You cannot time when you think a market crash is coming, right? Based on valuations, based on headlines, based on anything. And that's proven as well. You know, you can't, the flip side, if you can't catch the upside because of the timing, you also cannot avoid the downside because of the timing. What you want to do is get into a portfolio that you feel pretty comfortable with the range of outcomes that could possibly happen, right? And if you're someone that says, hey, you know what? I got ice running through my veins. I don't care if I wake up the next day. These Bitcoin investors that have been in for a while, they wake up in the morning and half their portfolio is gone and they're like, oh, well, it's just another Tuesday, right?

Chris:
[26:30] Um, so it's, uh, you know, it's, it depends on the investor. So if you're not that way, then Hey, diversification, owning other asset classes makes a lot more sense. And, uh, you know, one of those to consider that the expectations are so low on, in fact, a lot of people say, why even own international stocks? Well, this is from Wes Gray at Alpha Architect, and he says the post-great financial crisis period has seen two major divergences in valuations. That has led to divergences in performance. That was actually from Larry Suedra's article on Alpha Architect. But I know the AQR did a study as well saying that, look, the outperformance has been very little because of the fundamentals, i.e. The U.S. has better companies and a lot more because the prices have gone up. The price to earnings multiples have gone up. So the expectations have gone up, that people feel more comfortable investing in the U.S., etc.

Chris:
[27:39] So what Larry Suedro goes on to say in his article is, to quote Cliff Asnes from AQR, for those investors willing to be contrarians, they might quote-unquote sin a little by overweighting international assets with the expectations that valuations will converge. Now, again.

Chris:
[28:01] Not a timing thing. This has been the case for several years where international stocks have been a much cheaper.

Chris:
[28:07] Now, they're vastly outperforming so far this year, but that's six, eight weeks in, six, seven weeks into the year. So it's too early to tell, of course.

Chris:
[28:19] But if you're thinking to yourself, gosh, I need to get out of the market because I'm worried about what's happening. Maybe it's better to say, maybe if I dial back on certain investments and dial up on some of these other investments that I never even thought about or wanted to consider because the thought of investing in international markets just, again, you're not walking up to the barbecue and say, hey, how are your international stocks doing, Dan?

Dano:
[28:51] Not gonna happen right right and and something else to consider too is the um you know put it all in cash idea right so i'm freaked out about people don't say this either i'm freaked out about the market they don't say what they really mean which is i'm freaked about freaked out about the u.s stock market right they don't say that first part because they don't think of anything else And going all cash has its own risk, opportunity, risk. And look at the inflation numbers. Look at every day that you're sitting in cash, all cash, your dollar is worth less every day and the inflation numbers prove it.

Chris:
[29:39] That's right. Now this chart, this again from Bank of America, they had some bangers this week. They have the Eurostoxx 50. This is the Eurostoxx 50, so the blue chips from Europe. But Dan, you could remove the name of the index and you could remove that this was from 1999. And this could represent several different markets from past years. This has happened in the US. This has happened in Japan. This has happened in probably every major stock market. I don't know this for a fact, but I would guess that it's pretty close to every major stock market in the world has gone through a period of 20, 25 years with no return. This just happens to be the euro's time. So this is another argument for diversification because imagine in 99, you're a European and you have a home country bias. You invest all your money in the companies that you know that you feel are the best because you use them every day.

Chris:
[30:46] And here you are 25 years later going, geez, I went through some huge drops. I didn't make any money over that 25-year period. right so again the way out of that is diversify don't put everything into one market because this happens a lot throughout history and it has happened several times in the united states too people just forget that so expectations not there right uh the european markets have done very well so far this year. It always perks my ears up when things are doing well, despite the fact that there's no hype, there's no flows, nobody's talking about it, et cetera, et cetera. So they're showing here the Europe-focused equity funds have seen 561 billions of outflows since 2005. So nobody's investing there, and yet the market's going up. That's got to perk you, perk your ears up a little bit and say, hmm, interesting. Is this a case of the expectations are so low? I took the awful kid to the restaurant and they're sitting there quietly eating their food and drinking their milk. Huh. Right. Interesting. I'm so pleasantly surprised.

Dano:
[32:08] Okay. Now, Chris, I have to stop you because Chris, you have a dozen children. Cheaper by the dozen is actually based on you. and you keep talking about kids behavior I have to feel like maybe I feel like maybe there's some is there something going on you got a crybaby in the house what's going on

Chris:
[32:24] Maybe some Freudian slips going on I don't know Dan maybe Freudian slips yeah, So same with Bitcoin versus gold. So this is from Eric Balchunas again. He says, Gold has been on fire, a near record start to the year, and up 45% in the past 12 months, which is double the NASDAQ, by the way. Yet, he puts in all caps, no one cares. Virtually no flows coming in. Odd. Most likely theory is that Bitcoin ETFs have stolen all their thunder and dollars. And this was via somebody that goes by Sorofagus. Sorofagus, I think, is hopefully saying that right. But anyway, another situation where, hey, there's an asset class that's doing really well despite not getting any flows. Nobody's talking about it. Nobody cares, right? Literally no one cares.

Chris:
[33:25] And yet that asset class is doing really well.

Dano:
[33:33] There's uh trish can i share i used to work in radio so can i share a story with you about radio real quick absolutely go ahead

Dano:
[33:43] This is going to seem uh out of left field but it's related so in radio if you've ever been driving in your rate in your car and you'll see that some stations when you're listening if you still listen to fm radio or perhaps you did in the in the far far past um some stations the the name of the song and the artist will come through on the screen of your car. And it was new. It felt new. You know, that's like in the late 90s into the 2000s, suddenly you could get like the artist information on your car. What is that? It was called Radio Data System RDS. It's kind of cool. There's actually a lot you can do with it and actually the station itself can program in messages. But station to station, it was a mess and there was all kinds of different standards and that's because there was no governing body that was managing the whole system. Like the FCC would have managed, say, television in the 60s, 70s, 80s, etc. So basically, it was this cool thing that a few people were doing stuff with, but there was no governing body pushing an agenda, no governing body that was lobbying Congress for stuff. And so it just kind of existed and no one talked about it. This is the same thing as gold. It's exactly the same thing as gold. If there's no unified interest that's pushing

Dano:
[34:57] it as an agenda and paying for it to be on the news, then it's not. It just is. And you can either recognize it as an opportunity or you can go, okay, well, what does the headline say I should do? What do you think?

Chris:
[35:10] Yeah, that makes a lot of sense. Now, should you dump everything in gold? No, I don't think so. It doesn't mean pile everything in there. Here's the Russell 2000. So U.S. small caps is from Charlie Biela showing the number of consecutive days, or sorry, this is from Kevin Gordon and Schwab, number of consecutive days that the Russell 2000 has not surpassed its prior high. So we've been on a very long streak where uh you know u.s small companies have have been in the doldrums sideways so yet another market where where you can be sideways for a long time now it looks like it's only been exceeded twice once in 2008 once in 2000 despite the fact that we quote-unquote didn't have a recession um you know there's areas of the market that would seem to have shown at least a rolling recession along the way.

Chris:
[36:07] Now, some of the other news that we got this week was the existing home sales were also lower than what were expected. This is definitely another area of the market where you've definitely seen a recession in the real estate market in terms of home sales, especially on the existing home sales. Look at that down back where we were in the great financial crisis. And we've been here for at least a year, maybe longer. So trading down, trading sideways on those existing home sales. And we're also, just to remind you with the new home supplies, which is the yellow line, this is, or sorry, orange line, month supply, 9.5 months. So anything over nine tends to be too much supply and where you start to see prices lower and under three is where it's too tight. The supply is too tight and prices tend to go higher. There's just not enough supply. So as you can see, historically, we've not had a situation like this where there's been such a bifurcation between existing homes, which nobody wants to leave because they got their low rates thanks to COVID and the government intervention in the mortgage market.

Chris:
[37:26] Versus the new home sales just are not, you know, things are not moving. So the real estate market is pretty much locked up. And Charlie Billow here showing the housing inflation cumulative percentage. He says the monthly mortgage payment needed to buy the median priced home for sale in the U.S. has nearly doubled in the last five years. This remains the most unaffordable housing market in history. Now, to me, this is probably a source of a lot of the political upheaval in the United States is the fact that I think I saw a stat the other day that the average homebuyer age, first time homebuyer age now is like 50 something. I don't know if that's right because it feels like that couldn't be right.

Chris:
[38:13] But nonetheless, home prices are just unattainable for a lot of people when you look at it relative to incomes these days.

Chris:
[38:23] All right. So Daren messaged us that he actually fell asleep during this first part of the presentation. So hopefully this will wake him up. We're going to get some lines. No candles this week. Sorry, folks. I don't have the system that Daren has, but we're going to get some lines and charts. And so Daren, if you're still listening, wake up. We're coming back. um now so starting off with uh the s&p now we're using the s&p uh futures the index so um you can see here that the despite the sell-off today uh when you look at the 50-day and 200-day simple moving averages you know nothing to write home about we did not break that uh that moving average on the 50-day. So we're still in an uptrend. Usually when you see the tracks, like a ski track on the way up, hey, there's nothing to worry about at least yet in the S&P. So despite the sell-off today, nothing changing there. Same to say with the NASDAQ checking in with that 50-day moving average, but still a lot of upward momentum. And that's, again, why you say, Hey, you know, despite the evaluations, despite how you feel about the headlines, et cetera, et cetera. When you look at the technicals, no signs of weakness on the horizon yet.

Chris:
[39:50] Then we've got the bond market. Now.

Chris:
[39:53] This, while it doesn't look like the NASDAQ, it doesn't look like the S&P. You don't have the ski tracks going straight up. But hey, at least you don't have the ski tracks going straight down, which is what bond investors are used to seeing over the last three to five years. And so we've got the ag possibly on the move. Interest rates were down today. Bonds were green because of that. Remember the teeter-totter rates down, bond prices up. Rates up bond prices down and so uh uh bonds providing a little a little calm in the storm today thankfully um and then we've got the msc i acqui which is the uh x us x us indices uh should you know so basically as it sounds not the united states but the other the other countries And again, wow, that looks pretty strong, Dan. We've got the upward sloping ski slope, ski tracks again, and we're not even close to the 50 day moving average. It seems like it's chugging higher. And what's interesting is that the emerging markets are actually doing pretty well for once, right? And specifically China, I don't know what is happening over there at the moment, but I do remember that being uninvestable not too long ago. Turns out, at least in the short run, that was a… So-called uninvestable.

Chris:
[41:23] That was the kid you left home every time. Just leave him home. I can't take it anymore.

Dano:
[41:30] He'll get us kicked out of the restaurant.

Chris:
[41:33] We're going to get kicked out of the restaurant. We can't even take him. All right. So then we've got gold. Gold again. Wow. We're actually getting so far above the 50-day, Dan, that I wouldn't be surprised to see gold check back in. Usually when you see those big spurts higher.

Chris:
[41:55] Whatever the asset class is, it usually gets ahead of itself a bit. So we're getting some meaningful separation there between gold price and the 50-day moving average. So we might see some pullbacks there. But nonetheless, a lot of strength in gold at the moment. And lastly, we've got the U.S. dollar index. We saw some relief there because, remember, a strong dollar is difficult for asset prices, and it's difficult for any companies that export. It makes foreign goods cheaper to import, and so it makes it more expensive for other countries to buy our products. It makes it more expensive for other countries to pay us back any dollars that are either lent out to us or if they have a loan in dollars to another entity

Chris:
[42:51] outside of the United States. So a strong dollar can be a wrecking ball in in the markets and so uh we're looks like we're coming back into the range on the dollar at least for now down down at 106 uh so you know that's uh that's all for this week dano that's all we had on the charts but um wrapping up another another week here in february and um.

Chris:
[43:16] Hopefully that was helpful to go over. Apologies, I don't have a good Bitcoin chart for whatever reason. YCharts does not have that same index for Bitcoin.

Chris:
[43:31] I didn't leave that out on purpose. I tried to include it, but we just didn't have a great chart for it.

Dano:
[43:38] Well, Chris, I appreciate you so much for letting me step in on the show. I always enjoy guest hosting. Daren will return next week. And I'll just say one more thing, which is that the goal of the show, the goal of On the Markets is to relay what we're seeing and what we're feeling as we're watching various market indexes. And it's educational. And something to consider is that rational advice usually isn't very exciting. You know the a measured approach to something certainly doesn't leap off the page for your emotions like calamity and catastrophe does and so it can be counterintuitive but sometimes sitting there and actually looking at the numbers and walking it all through and talking it all out can really be beneficial so it's one of the reasons that we do the show and we hope it's been helpful for you and Chris thank you so much for putting it together and thanks for being here Yeah,

Chris:
[44:40] Thanks for joining, Dan. That was fun.

Dano:
[44:44] See you next week.