No Tariffs? Now What?

DANO WEIR: Happy Friday, February 20th. Can't believe we're almost wrapping up February here in 2026. My name is Dan O'Weir. I'm the Marketing Director for Sonoma Wealth Advisors and the Fermata Advisors family of brands. And we're about to go on the markets. And our theme this week took a turn with the striking down of the President's Tariff Authority. How did the market react to the Supreme Court ruling today. We'll get into that.

DANO WEIR: Why the market might be fearful of the hyperscalers' latest superhero team, the Cap X-Men. First is gold, second is silver. What medal in the Olympics do you get for coming in last place? Coal? Because pending home sales gets that medal this week. An all-time low, we'll look at that. And the S&P is holding on for its dear life. And what the oil market might be saying about Mid-East tensions. Let's go.

SPEAKER 2: The stock market, the economy, your money. What's the latest and what could be next? Find out now with Fermata On The Markets. Straightforward financial market updates for the brands of Fermata Advisors, Sonoma Wealth Advisors, Fermata 401k and Fermata Tax. On the markets starts now.

DANO WEIR: Bring in the managing principals of the firm, Sonoma Wealth Advisors, our private wealth brand, and the Fermata Advisors family of brands, Daren Blonski, CFP, Chris Sipes, CFP. Guys, we are living in a world without tariffs. Well, with less tariffs.

DANO WEIR: Your reaction, your gut reaction when you first heard that today, Chris?

CHRIS SIPES CFP®: Not surprised because the prediction markets had assumed, I think it was like a 70% chance, roughly, that the Supreme Court was going to strike down the tariff. So I'm not surprised.

DANO WEIR: And to be clear, they've struck down his ability to enact this emergency powers for tariffs. There are still some that are in place, but it's certainly massively reduced, Daren. And I mean, are they going to have to refund all this or what happens now?

DAREN BLONSKI CFP®: Yeah, I Don't think anybody knows that. That was the interesting reaction, I thought. I thought for sure when that came out, even though it was predicting that it would happen, that the markets would react a little bit more than they did. And the markets just said, meh, Don't care. And I thought that reaction was fascinating overall. And I Don't think anyone knows.

DAREN BLONSKI CFP®: In the Supreme Court. Ruling. They did say it could cause a lot of mess when it comes to refunding these, but we shall see. Although I was talking with Chris earlier today and we were thinking about this and this idea came to me earlier this morning when I was thinking about, you know, Trump's been pushing heavily on Chair Powell to lower rates. Why?

DAREN BLONSKI CFP®: Because it's very beneficial if rates get lowered before the midterm elections. And then I started thinking about this. If Trump has to pay back $150 billion to these companies that they put tariffs on, a lot of them are U. S. -based companies. Well, that could be really interesting from a market stimulation standpoint. And it might end up being quite the clutch geopolitical move.

DAREN BLONSKI CFP®: Like, oh, okay, I'll pay back $150 billion to all these companies. Wow, that would be nice for the market. So anyway, I think there are like any situation, there could be some real positives that come out for at least for the market standpoint. But that also means that our government just goes more broke, paying more money in the economy and blowing this bubble higher.

DANO WEIR: And I'll say something too, because, you know, there's a take it back to the fall or take it back to whenever the ducks start lining up. And People, I want to be really gentle here. You see that, you know, a president is allowed to pick Their Supreme Court and they're going to put in the people who, you know, are going to vote their way or whatever.

DANO WEIR: And it's an all conservative Supreme Court or whatever. You know, John Roberts, the chief justice was put in by Bush, you know, and that's not a, you know, a left leaning judge per se. One thing that was interesting, I think, about this ruling is if you have this idea that it's all lockstep with party, this is an instance where that didn't necessarily happen.

CHRIS SIPES CFP®: That's right. So this week's meme really has nothing to do with anything we're talking about.

DAREN BLONSKI CFP®: Chris, you're super quiet. Can you talk? Sorry. Is that any?

DANO WEIR: Yeah, there you go.

CHRIS SIPES CFP®: Sorry, this week's theme has really nothing to do with what we were just talking about.

CHRIS SIPES CFP®: Thought it would be funny anyway, since we talk a lot about AI and all the things that AI can do and all the things that it's promised to do. So hopefully that makes it some laughs this week.

DANO WEIR: Yeah, we're looking at a meme for audio audiences, a guy looking at a computer and he says to the computer, say I am alive. And the computer says. I am alive. And the guy goes, Oh my God.

CHRIS SIPES CFP®: I got a kick out of that. But anyway, back to tariffs, as you said, the, the, the tariffs that were put on, you know, using the emergency powers were basically what was struck down. And Gorse Gorsuch wrote the, I guess, majority opinion, which you can reach here.

CHRIS SIPES CFP®: And essentially it says like Look, things like this should be done by Congress. And even though it takes longer and it's way sloppier and all of that, it is the way that it should be done for the longer term better of everybody because it doesn't get changed as quickly. Essentially, changing it day to day isn't what the law had in mind, essentially.

CHRIS SIPES CFP®: And then we got from Kavanaugh the a dissent. And as Daren was saying, part of the dissent was, what do we do now? But he also says, hey, look, that's not for us to decide. We're just supposed to judge on the law.

CHRIS SIPES CFP®: But he does say the United States may be required to refund billions of dollars to importers who pay the IEPA tariffs, even though some importers may have already. Passed on those costs to consumers or others, as was acknowledged at oral argument, the refund process is likely to be a quote unquote mess. And then he goes on.

DAREN BLONSKI CFP®: You know it's a mess when the Supreme Court calls it a mess in their formal document. Like what else are you going to say? It's a mess.

CHRIS SIPES CFP®: It's a mess. And then he goes on to talk about like, also all the, you know, the deals, the trade deals that were done based on the premise that. These these tariffs were a thing you know the leverage that was used so who gets refunded who does it how does it work guys i'm not going to spend my refund check until it hits the bank i'll tell you that i'm.

DANO WEIR: Not gonna expect anything i Don't know about you guys yeah i mean i think you have to what he attempted to do is unprecedented at least in the modern era So you have to, as has meant many, often the case with him, and therefore you're going to get be in uncharted territory as a result. And he was seeking uncharted territory, which is, you know, a government that's financially in balance.

DANO WEIR: And now we're in uncharted territory as a result. So one thing that I think that concerns me is that, you know, it says like that. The United States may be required to refund billions of dollars, which sounds like very legal, right? But at a certain point gets down to required by who? And what is your recourse against the United States government?

DANO WEIR: And maybe not so much for the companies, but for some of these countries, you know, so it's like, if he doesn't have the tariff as his threat, then the only last threat is like the military, you know? So like, It will be interesting to see how much actually does or doesn't get repaid and what gets resulted. And we hope that everybody keeps cool heads, I guess.

CHRIS SIPES CFP®: Yeah. Remember when these first came out, there were companies, I won't mention any, but companies that you do online ordering from, and they had put a separate line item that said additional costs due to tariffs, basically.

CHRIS SIPES CFP®: They were actually separating it out as a line item expense. Had that stuck, of course it didn't because they got a lot of heat for doing that, but had that stuck, it might be a little easier to refund who actually paid what and when.

CHRIS SIPES CFP®: But now, how are you going to sort that mess out?

CHRIS SIPES CFP®: Now, in terms of the market, though, if you think about who are the winners, at least based on today's price action, because if you look at price being the final arbiter of truth, well, you could say really the, the stock market, the U S stock market was up a little, you know, so, it was like, okay, that's a, it's a good thing for, for stocks in general, but however, the small stocks were flat.

CHRIS SIPES CFP®: So there was no, there was no response by the small stocks, for whatever that take that for what it's worth. Interest rates were up slightly, which, you know, kind of across the curve interest rates going up a bit. Also a little counterintuitive.

CHRIS SIPES CFP®: Maybe that's pricing in more growth. I Don't know. Emerging markets, really the big winner on the day. You had markets like South Korea, South Africa, India, Brazil, all up pretty significantly on this news. Mexico.

CHRIS SIPES CFP®: So some of the strength that we've already seen in the foreign markets, even with the tariffs on, just continued, right? So So that's interesting. Sector-wise, the large growth had some good responses. The communications sector, consumer discretionary, we saw some strength there. But gold, the old story, as we've been talking about for what seems like a long time at this point, gold again, another strong day.

CHRIS SIPES CFP®: It just continues to see that momentum. So anyway, in terms of how the market is responding, it's interesting to see how these various asset classes are responding to this information that was, again, largely baked in because I think the probabilities were very high that they were going to rule against the tariffs, at least in their current form.

DANO WEIR: And I want to say this just to give you... Peace of mind. This is not to say that you listening or someone who did this was wrong. I want to give you peace of mind, which is to say in April, tariffs are enacted and the U. S.

DANO WEIR: Market, among many others, got smoked, right? This massive, to the point that we had to do an emergency live stream to try to talk about it, right? So therefore, the exact opposite should be that when the tariffs go away, the market's going to surge. No.

DANO WEIR: Yeah. No, you know, we saw like today it was just like, meh. So what a perfect example that it is not the same set of circumstances. And if you're feeling like, man, if only I knew, or I should have known, or, you know, when it happens after the fact, I should have known that it does not compute. The math does not work how you think it always will.

CHRIS SIPES CFP®: Very, very well said. And if you just looked at the market.

CHRIS SIPES CFP®: At the numbers today and and you did not know that the Supreme Court had ruled i Don't think you would have looked at the market go somebody something definitely happened it was like just a continuation of the trends that we've been seeing so anyway now this from let's see if i can brian sozi and showing the mechanical kind of step down of the tariffs so what's interesting So going back to...

CHRIS SIPES CFP®: Countries that did deals, those are the ones that are highlighted here with the yellow. So there was a deal done with the idea that the IEPA tariffs would be relaxed. Those IEPA tariffs were a part of that deal. Then you've got the no deal IEPA-based tariffs, China being the largest recipient of those.

CHRIS SIPES CFP®: But also the rest of the world kind of significant there. But you've got a lot of countries like Indonesia, Japan, the UK, several countries that did deals based on these tariffs.

CHRIS SIPES CFP®: And so it'll be interesting to see if there's any changes there now that they've been ruled against. And then you see the actual tariff rates along with the tariff level ex-AEPA, meaning if AEPA is removed.

CHRIS SIPES CFP®: Where would that tariff level be relative to their actual tariff rate, which is quite a bit lower now. It's too early to haven't been able to do all the analysis. All this happened today while we're still meeting with clients and everything.

CHRIS SIPES CFP®: But my understanding is that President Trump reiterated another 10% tariff kind of across the board using some sort of temporary tariff that is within his power to use, but it's only— You can only apply it for 150 days. So, and I Don't know all the rules. Maybe they get to 150 days.

CHRIS SIPES CFP®: They say all the tariffs are relaxed for. 20 minutes and then put them back on. I Don't know how that works, but you can see that the amounts that have been wiped off in terms of the tariffs is fairly significant based on those IEPA rates.

DANO WEIR: And Chris or Darren, let me ask either of you this question. So if we're removing the United States' ability to negotiate country to country, does it then just take it down to business to business. As an example, NVIDIA was greatly restricted.

DANO WEIR: On their ability to do business with China as a result of some of these tariffs. So now instead of having the United States able to levy policy that dictates terms, basically remove that layer and now it's just up to Amazon to have morals and not do deals with countries that are perhaps not keeping the American standard.

DAREN BLONSKI CFP®: I feel like even the sentence Amazon have morals is an oxymoron.

DANO WEIR: Exactly.

DAREN BLONSKI CFP®: I Don't know. I mean, I think, yeah, the question is, I Don't know. And that's the answer to the question. It appears, though, that Trump has a backup plan, whatever the heck that means.

DANO WEIR: Well, yeah. I mean, when you're playing 4D chess, there's four levels and there's a fifth level, too. So, you know, he's always got a backup plan, right?

DAREN BLONSKI CFP®: Like, I was thinking about this going to earlier conversation, but I was just like, dude, I can just... You just know that Teflon Don is going to say, hey, oh yeah, this was the plan all along. Now I have $150 billion to dump on all these companies over the next two quarters. Oh, magic, midterm elections. It's the economy, stupid.

DAREN BLONSKI CFP®: I could just see him taking credit for that.

CHRIS SIPES CFP®: Agreed. Good prediction there. So, okay, we've got the sentiment predictors this week. The bearishness has inched above bullishness for the first time in a little while. So the bearish ticked up to 36.9 while bullish is at 34.5, but still roughly within the kind of normal ranges of usually around a third in each bucket of bullish, neutral, and bearish.

CHRIS SIPES CFP®: We've got the CNN fear and greed index about the same as last week at 39 fear. It was at 35 last week. And then Bitcoin, wow, ticking all the way up to nine.

CHRIS SIPES CFP®: We're almost in double digits at extreme fear. Last week we were at five. So Bitcoin crawling out of the dundrums of sentiment as it follows price as always. So, okay, where does all this lead? Because before the tariff decision, we were going to talk about inflation and interest rates.

CHRIS SIPES CFP®: And the Fed came out with an interesting little nugget this week in their minutes that they actually refer to the prediction markets. We Don't call them betting markets. We call them prediction markets.

DANO WEIR: Of course. It's predictions, not betting.

CHRIS SIPES CFP®: Yes. It's the prediction markets as a source of data. And so if it's good enough for the Fed, it's good enough for Sonoma Wealth here. And we've got the Fed decision in March. You can see that the market expects a maintenance rate, maintains the rate, the cuts rates at only 6%, so very low percentage chance that they cut in March.

CHRIS SIPES CFP®: And then we look at the number of cuts in 26. This is interesting. We are kind of neck and neck with... Two or three rate cuts but look at the jump in one cut kind of creeping up and that was another big thing with the Fed minutes this week is that you know reading the tea leaves they were kind of leaving it open for you know not hiking but they were saying like there's less and us.

CHRIS SIPES CFP®: Reason to cut. Even some of the newer appointees were a little more hesitant with some of the inflation and PCE numbers that have come out. And so I think that's going to be obviously a hot potato for Mr. Warsh to deal with when he becomes the Fed chair after May.

CHRIS SIPES CFP®: But it's interesting that the markets are slowly pricing out these These rate cuts due to the stickiness of the inflation numbers in the markets.

DANO WEIR: I want to give one grain of salt on prediction betting markets, which is that. Because these are becoming more and more interesting, obviously, it is data. And we follow indicators wherever it may be. But when it comes to betting, and Darren, I found a way to make it football. The line in football is designed to attract business, is designed to attract flows. So that's why you'll often see it move when they.

DANO WEIR: As a game gets closer, because as more money piles in for one particular decision, they will move the line to try to attract more business. So when we're looking at prediction market data, know that, yes, it's in one way saying how much they think it's going to happen. But in another way, they're moving it so that it'll attract, you know, some payouts and attract some inflows. So just a grain of salt, I think.

CHRIS SIPES CFP®: Yeah. Now, for those that might be wondering, like, how do interest rates, why does inflation matter for interest rates? The answer to that is interest rates are the price of money. Money is a commodity like anything else. That price of money is the interest rate.

CHRIS SIPES CFP®: And if you are a fixed income investor, if you're going to buy a bond and you're going to invest your money for a long period of time in In return, you're going to get a coupon on that bond. So let's just say it's a 10-year bond. You're going to buy a 10-year bond from the U. S. Government, and that rate is going to be fixed when you buy that bond.

CHRIS SIPES CFP®: Now, because it's fixed, you as the investor have to look ahead 10 years and say, is my money going to make at least what inflation is? I Don't want to lose ground. I Don't want to lose purchasing power to inflation. So as an easy example, why would you invest your money at, say, a 2% yield if inflation is running at 4?

CHRIS SIPES CFP®: You're like guaranteeing yourself a 2% loss, right? And fixed income investors, bond investors are not dumb. Mostly like institutions like insurance companies and pension funds and things like that that have long-term obligations that they have to meet. And so they have to look into the future to make sure that they can invest to meet that.

CHRIS SIPES CFP®: So inflation is very important for that calculus. And not only the actual rate of inflation, but the volatility of that inflation is very important, as you can imagine because when we're trying to judge what that rate should be over time. If it's more volatile, it's harder to judge. It's more uncertain.

CHRIS SIPES CFP®: So that's why inflation is so important for the rate cuts and the Fed can't, they Don't operate in a box. They can't just earn a vacuum. They can't just go out in lower interest rates and then the whole market follows suit. No, it's, it's a market of investors.

CHRIS SIPES CFP®: And, so interest rates are set, you know, by millions and of investors across the planet. And the Fed sure they could go out and just lower interest rates to zero tomorrow. However, they would risk losing credibility and lose and risk losing, more of that certainty.

CHRIS SIPES CFP®: And, and so they, they are kind of boxed in by the market in that, in that way. Investors expect them to, to keep inflation under control price stability. Sorry. That last chart, we're talking about growth versus value because different stocks react differently to inflation metrics.

CHRIS SIPES CFP®: And here you're seeing the Russell 1000 growth versus value, and this is a price to sales metric. And you can see that a lot of the additional you know pricing in of future growth has been in the growth stocks. And that has just meant like investors have been willing to pay a higher premium for those stocks.

CHRIS SIPES CFP®: So the weakness that we've seen in the NASDAQ and some of the tech stocks and a lot of the software stocks this year, if this chart is any indication, you might continue to see more of that based on the fact that those that price to sales ratio has really gotten pretty extended when you look at growth versus value.

CHRIS SIPES CFP®: So maybe there might be more room to run on the value trade. Now, what has changed in some of those large tech stocks is their CapEx.

CHRIS SIPES CFP®: And we've been talking about this, the amount of money that that these hyperscalers, as they like to be called, or the market likes to call them, are putting into CapEx data centers, et cetera. And you can see Amazon, Microsoft, Alphabet, Meta. The one outlier in the mags is Apple. And I Don't know where Tesla falls on here.

CHRIS SIPES CFP®: I guess they're just not including Tesla in the mags. But look at Apple. Really go in the other direction. They've decided to kind of take a different route in terms of how they're going to build out on their AI. So that's an interesting strategic point there.

DANO WEIR: For people who Don't know, Chris.

CHRIS SIPES CFP®: CapEx is what? Capital expenditures. And essentially it is like, think of property, plant, and equipment kind of being the biggest, easiest example of that. And so if you go build a data center, that's going to be considered, you know, CapEx.

DANO WEIR: If you're a construction company and you bought five new backhoes this year so you could do twice as many jobs, that would be a capital expenditure.

CHRIS SIPES CFP®: Yes. Yeah, exactly.

CHRIS SIPES CFP®: And we've talked in previous shows about how the market traditionally has not tended to reward equity prices when CapEx gets a larger and larger portion of the overall cash flows because it's harder to... It's harder to judge the returns there longer term. Now, that CapEx has a percentage of cash flow from operations here.

CHRIS SIPES CFP®: When you look at the hyperscalers in the dark blue, you can see that they have really overtaken two other sectors that spend a lot on CapEx. So telecom and utilities being the... Two major ones. I mean, as you can imagine, those two sectors would have a lot of CapEx.

CHRIS SIPES CFP®: They have a lot of property, plant, and equipment that they have to keep maintained and install and everything else like that. Well, the hyperscalers, when you measure that CapEx as a percentage of the cash flow from operations, they're kind of going off the board here.

CHRIS SIPES CFP®: So we'll see if that continues though because We Don't even have time to get into it today with everything else that's going on, but private credit, there's a lot going on with private credit. What was it? Owl was in the headlines this week that they are gating their funds, meaning they're not allowing investors to redeem at the rate that investors want to redeem at.

CHRIS SIPES CFP®: Among other things, like selling some of their loans to their own insurance company.

CHRIS SIPES CFP®: They are also backing out on commitments to fund a data center for a large AI company. It was like $4 billion that they said, yeah, sorry, we can't actually finance that like we thought. So I think there's a lot going on in the private credit space right now. Under the hood, very interesting. We'll see if it actually has an impact on the markets or not.

CHRIS SIPES CFP®: But that's something to keep an eye on in terms of this CapEx.

DANO WEIR: And if you're trying to track, because I always am, trends in the narrative, the narrative last spring and summer was the transformational power of AI, which is an inevitability, but is it a present inevitability? Seemed like a lot of money was spent between, you know, whoever's putting through on money places, whether it's private equity or companies themselves.

DANO WEIR: And they I guess they thought it was going to be an immediate return because then after like Q3 earnings, all of a sudden, like the blooms off the rose and by Q4, it's like now we're at where we're at. So as you're saying with some of these companies, you know, they are looking to move other things around, perhaps to cover for. Investments made last summer.

DAREN BLONSKI CFP®: I will say, too, and this is an anecdotal here, I have a buddy who is in electrical gearing, so they sell the switches and the gearing in all these mega data centers. And the demand for the demand going on for these big data centers and these build outs and these mega, they're still going, man. It has not gone away. And I think it's wearing off some of its excitement in the news, but Don't be fooled. It's coming.

DANO WEIR: Well, right. It gets into what you've always said, Darren, which is that S curve. You know, you get that initial like it's going to be and it seems like people thought it was going to be in like two months. And then when it wasn't in the fall, people like, oh, OK, I guess we're done with that.

DANO WEIR: You know, but then the hyperscalers and these companies that are putting in the money, they're still cranking on the work. And then when you really start to see the returns, you know, within year or two years or whatever it may be.

DAREN BLONSKI CFP®: Yeah, and I think they're trying to figure out how to monetize. The large language models, right? How do you make money on it? But I think that's going to get figured out pretty quickly. I Don't think it's going anywhere.

DAREN BLONSKI CFP®: They just have to figure out the monetization schedule. So it's kind of like invest all this and, oh, yeah, we got to pay it back. But we're going to make dang sure this revolutionizes everyone's world so that we can collect on our investment.

CHRIS SIPES CFP®: Now, one of the biggest inputs for inflation, specifically the CPI, inflation number, which is kind of the official number that so much of things like social security cost of living adjustments are based on CPI as an example. Roughly a third of CPI is based on housing and they do it through something called owner's equivalent rent, which is a really weird way to look at it.

CHRIS SIPES CFP®: But underlying this is that housing is a big part of the CPI number. So when we got really high. Inflation numbers a few years ago, 22, 21. One of the areas that the Fed was targeting with these higher rates was real estate. And that was because the prices had just run away.

CHRIS SIPES CFP®: And as those prices were going higher, that was feeding into the inflation numbers in a big way. Well, we got pending home sales numbers again here this week. And again, they're just in the... The housing market is just install, install speed, right?

CHRIS SIPES CFP®: Where the interest rates, other things have kind of flown, flowed through to really put the, put the brakes on the, on the housing markets. And it's really stark when you look at this chart, seeing that the pending home sales are where we were, you know, in the depths of COVID and, and it's been that way for, you know, quite a while. So. Housing markets really stuck at the moment and the inflation rate.

CHRIS SIPES CFP®: So on the top chart, we've got the mortgage rate. On the bottom, we've got the CPI, the price index. And so now the price index has continued to kind of just go up a little bit, which CPI has been running right around 3%. So each year, these prices have been going up about 3%.

CHRIS SIPES CFP®: And Going back to how does the fixed income get priced? How do the bonds get priced? Inflation is a big part of that. Well, mortgages are bonds. There's an investor on the other side of your mortgage that is buying that mortgage for the cash flows, for the return stream. And you can see here that the mortgage rates have really been pretty much flat since what is that late 22.

CHRIS SIPES CFP®: We're at 6% still on the 30-year fixed. And until they can kind of, you know, really get inflation to work itself out and get those interest rates down, you know, it's going to be tough to see any relief in the mortgage rates to help free up the housing market at all.

CHRIS SIPES CFP®: And this was a great chart from Connor Sen. And he says the slowest moving, but perhaps the most important chart in housing is the effective interest rate on all mortgage debt outstanding. And that ticked up four basis points in Q4 of 2025. So you can see there it's about four and a quarter. That means that like if you added up all the mortgage debt in the US, what's the average rate that that person is paying?

CHRIS SIPES CFP®: Four and a quarter. Pretty significantly below six. So the people that have mortgages, the vast majority of them have interest rates that make them not want to move and not go into a new mortgage. So that's going to slow things down. So as he says, housing can't meaningfully boost the economy until current mortgage rates are closer to this rate.

CHRIS SIPES CFP®: Now, the other thing that's kind of helping drive the stall out in mortgages and... And I think also playing through into all the kind of weirdness in. Leading economic indicators. There's been so many things that we're like, well, this has never happened outside of a recession.

CHRIS SIPES CFP®: Or usually when you see this number, it's because we're in a recession. And yet the market has just continued to trudge ahead and not seem to care about it or respond in a recession type of way.

CHRIS SIPES CFP®: I think that a large part of that is because of the the drive of... Spending and the economy is largely held by the baby boomers and the generation that is retired and has most of the assets. This is a great chart from Charlie Bielo. Going back to 1989, the household wealth held by Americans 70 years and older was at 19% back in 1989. You can see was pretty flat until roughly the financial crisis.

CHRIS SIPES CFP®: And then after the financial crisis, that number has just climbed, now at 32%. So, a third of household wealth, in the U S is held by those 70 and up. And if you think about it, like their spending is totally different. Their, their motivations are totally different. Their, the the way they spent all these things. So the impact on the economy is massive based on this demographic shift, the largest generation in US history.

CHRIS SIPES CFP®: Sorry, Dan, I thought you were going to pipe in with some wisdom there.

DANO WEIR: I was thinking about it. I mean, do you want to hear what I was thinking?

DAREN BLONSKI CFP®: I Don't know. Do I?

DANO WEIR: Well, I was just thinking this. So if you, because if you look at I'm not going to name anything specific, but many stocks, the S&P, if you look from 2008 to now, to Darren's point often, when the printing really started, you just see stocks just take off after 2008. And so you've got this generation of people who are 70 now, but they were 50 then.

DANO WEIR: And what had they been doing? They'd been, as they were instructed to and required to in some cases, chunking away on their retirement. And so they have this 401k, which they had to have. And then due to forces that had nothing to do with them, that happened to be extremely valuable.

DANO WEIR: So it'd be as if like you were required to have a baseball collection, baseball card collection, Chris. And then for whatever reason, baseball cards like went off the charts. And now this collection, which somebody's told you you had to have is worth like 15 X what it was before. And now you're like, well, I Don't even, what do I do? That feels like what the baby boomers are like.

CHRIS SIPES CFP®: Well, yeah, in some ways I think that's true. And also I think that they weren't all required to have it. And we meet with people every day that are like, hey, you know, I've been a nurse for, you know, 40 years and I just. Put aside money, every paycheck, right? Just diligently saved, never even looked at it, didn't even realize like how much I had or anything like that.

CHRIS SIPES CFP®: Just saved regularly, right? I mean, we have so many clients like that, that, that, and so it wasn't just a, a stroke of luck or, you know, they were just given, given it as a, you know, a requirement. A lot of people chose to put money in their 401ks or 403bs or whatever. Now the market's been done very well since the great financial crisis.

CHRIS SIPES CFP®: So that has a huge impact on this too. So there's a lot of reasons. It's not like you can put your finger on one thing, but now that it is this way, I think it is having a big impact on the economy and therefore On The Market, you know, on, on just what, what is, what the demographics have done over the last 20 years.

DANO WEIR: I think there's just, I think what I'm trying to say is there's sort of like a Negativity around quote, boomers as that phrase is. And it's like, oh, the people who were trying to do the right thing, you know, like saving money for themselves, you know, like, and they did well, you're mad about that. You know, it just, I Don't know. It's interesting.

CHRIS SIPES CFP®: Yeah. Well, this is from JP Morgan showing the spending. Okay. So the percentage of overall spending, and we've talked about this in the past where, you know, that's why it matters more. It matters less like the number of jobs, Right? And it matters more on what that top 20% is spending on and that they continue to spend and they still feel the confidence to spend, right?

CHRIS SIPES CFP®: Because that is what is driving a lot of the spending. So, and where is that sourced from? Well, when you look at the mix of assets, look at homes, you know, home equity is 26%. Of the total assets of the consumer balance sheets in the U. S. And other assets would be taxable.

CHRIS SIPES CFP®: Stocks and things like that, probably business ownership. A lot of the small businesses and medium-sized businesses owned by those folks that haven't retired yet, for instance.

CHRIS SIPES CFP®: But when you look at the debt service ratio up in the top right, that's basically the percentage of debt to that person's income is very low. So the consumer's in very good shape. The average, when I say the average, right? The top that is doing that spending.

CHRIS SIPES CFP®: While the other driver of interest rates, one of the probably the biggest driver of interest rates is the US government and the debt that they need to borrow, right? The big Papa Steve at the barbecue that comes in and needs the most food, the most demand. That is going to be the U. S. Government.

CHRIS SIPES CFP®: We talked about my old econ professor that used to talk about his Uncle Steve that would come and everybody tried to get the food before Uncle Steve got there, right? Big Papa Steve. So when you think about the U. S. Government and how much money they need to borrow, they're at the margin setting a big part of that cost of money, that demand for money when you look at the supply and demand.

CHRIS SIPES CFP®: Everybody knows the U. S. Government's finances are not in very good shape, which is driving gold every day, it feels like. This from Hedgeye, gold's 30-day volatility is at the highest level since 2008. Usually, when you see this much volatility in gold, there's things happening.

CHRIS SIPES CFP®: The, the, the market just has not seemed to respond to whatever gold is responding to at the same time. You know, it's just, it's not, it's another one of those things. It's like, Hey, this isn't super normal that everything's going up and gold, gold is, is doing as well as it is. So anyway, it'll all make sense in hindsight, but, but that's where we're at today.

DANO WEIR: All right. Thank you, Chris. Darren, it's time. Fire up that screen share, buddy. I want to see those candles. Let's take a look at the technicals this week and see. You mentioned that the S&P is holding on for its dear life and thoughts on oil and Mideast tensions. So how is that actually playing out in the charts?

DAREN BLONSKI CFP®: Great question, Dan. So S&P 500, S&P. Spy is just an index that tracks the largest 500 US-based stocks. Those 500 stocks split up into 11 different sectors. Each of those sectors throughout different parts of the market cycle perform in certain ways. And so what are we seeing right now with the S&P 500? Daily charts.

DAREN BLONSKI CFP®: This is looking at each one of these candlesticks represents a day in the market. And you can see this red line right here. That red line is the 20 period moving average. So basically just takes when we're looking at a daily chart, 20 days and then averages it across. It's kind of looked at as one of the short term trading averages, an indicator of if the market is positive or negative.

DAREN BLONSKI CFP®: So...

DAREN BLONSKI CFP®: You can see we closed the day right on the line of that red line there, that 20-period moving average, suggesting that there's short-term weakness maybe here, but maybe not yet because we're going to close right above that average. The market is very intentional, especially on a weekly close. So it closed right above that important line.

DAREN BLONSKI CFP®: And then you can see this 20-weekly moving average, which is the red line here. We came in, touched it, and then traded back above it. So that's good news. Given the red candle we saw last week, we came back up this week. And so when I say holding on for dear life, that's what I mean by the S&P holding on for dear life.

DAREN BLONSKI CFP®: When we look at this on a heat map, this is a visual way to look at the S&P 500. So these are the 500 cap-weighted stocks. What we're seeing is a rotation generally out of these bigger. Into some of these smaller stocks, which is actually a healthy thing. These stocks have just become too big.

DAREN BLONSKI CFP®: Too big and we want to see that rotation happen and you're starting to see that we've seen a lot of improvement in more diversified portfolios this year than the concentrated portfolios over the last that we've seen do really well over the last few years so when we look at this you can see we still had the big dogs hung on this week but lots of green under the screen utilities getting a bid you which is interesting because usually that's a risk off basic materials consumer defensive not doing super great which is kind of a mixed reading on whether or not the market's rolling over maybe we just have a rotation so before you bounce off of that so just in light of the tariff news you.

DANO WEIR: Know we if if we're living in a culture of extremes you would have expected this to either be way greener or way redder. And this is a good color representation of meh, like just sort of a non-response to the tariff news.

DAREN BLONSKI CFP®: Yeah, I was kind of surprised by that. When I saw the headline come through that the Supreme Court struck down the tariffs, I thought for sure that was going to impact the market more negatively. And really, it didn't. It didn't really seem to impact it in any meaningful way, which tells you is it was probably priced in already. The market has already been kind of pricing it in and working it through.

DAREN BLONSKI CFP®: Doesn't seem to care. But like I mentioned earlier, you could actually spin it as a really great thing because now, you know, who are they going to pay back the tariff money to? Is it going to be the companies, the people? You know, what is it? And I certainly, it appears at the moment that, you know, if you think about it, the Supreme Court just gave the Trump administration $150 billion check to injecting U. S.

DAREN BLONSKI CFP®: Companies. That could play into their hand pretty nicely. So we'll see how that plays out. That's just kind of three-level thinking there, but who knows how it plays out. I wanted to take a minute real quick to look at Polymarket, which is kind of one of the betting markets. Chris and I were talking earlier that the Federal Reserve in their minutes actually mentioned the betting markets.

DAREN BLONSKI CFP®: Apparently, they're paying attention to the betting markets now as an indicator for the economic sentiment. But one thing we've really seen increases here, this U. S. Strikes by Iran by March 7th, 45% by the 7th, 53% by the 15th. It certainly seems like things are building significantly. We've only got an 18% chance that they hit it by February 28th.

DAREN BLONSKI CFP®: Then I always say, okay, let's look at the betting markets, look in real time, and let's look at... You know, something like the flight tracker data. And when you look at that data, there is a more apparent, I've been kind of watching this for a few weeks now. And what I'm watching is this line from Israel all the way over to Tehran and this flight path here. Because if we start taking out Iran, you'll see a lot of the...

DAREN BLONSKI CFP®: And there's a lot of things getting flown in both directions between Israel and Iran. And the news can say what the news wants. But at the end of the day, when we start seeing all these planes start going on either side of Iran and avoiding Israel, we'll know something's about ready to pop. So forget all the rumors you hear in the media. Just go to the flight tracker data to tell you what happened.

DANO WEIR: Darren, what about the alien technology that allows you to subvert the flight tracker? We're going to find out about that this week too, right?

DAREN BLONSKI CFP®: That was pretty funny. So for those who Don't know, President Obama was on a podcast and basically said that alien life is real or something to that tune. I never really tell what they're talking about per se. And then someone asked President Trump, like, hey, what do you think about Biden saying that aliens are real? And Trump said, well, that information is classified.

DAREN BLONSKI CFP®: Maybe I'll get him out of trouble by just declassifying it all. So yesterday, he comes out and says, oh, yeah, we're going to start declassifying all the alien stuff. You just can't help but wonder about the timing, right? Prince Andrew was also arrested yesterday for his ties to Epstein or supposedly arrested.

DAREN BLONSKI CFP®: I Don't know if he really was arrested or if that's just, I Don't know, it becomes such a Gen Xer when it comes to. People actually getting punished for their crimes if their politicians are powerful. But they apparently arrested Andrew, Prince Andrew. And, you know, one person's been arrested for the Epstein stuff. Okay.

DANO WEIR: But anyways, aliens, aliens, but anyways, aliens.

DAREN BLONSKI CFP®: I mean, you just have to wonder sometimes about the timing of things. Like, oh, okay, let's talk about aliens. Okay, if you want to.

DAREN BLONSKI CFP®: So anyway, that's kind of interesting. S&P's hanging on. When we look at the mags, this is the Magnificent Seven, right? This is an ETF that tracks the mags. And you can see it's really kind of turned and rolled over. And then found support here at the 60 number and then bounced up.

DAREN BLONSKI CFP®: But we're still under kind of this zone here, and we need to break out above here to think we're going to get another run in the mags. Right now, I would just say this is a test of resistance. And actually then next week, we would expect to see another candle down here if it's going to roll over. At that test of resistance, if we break above that, then we're into something different.

DAREN BLONSKI CFP®: Maybe we're sideways channeled for a while. I Don't know. Per my conversation earlier, if we really step back and look at a longer-term cycle, though, the trend is still up. I Don't think how you can argue that. And I think people are like, yeah, well, maybe all these data centers are going away.

DAREN BLONSKI CFP®: I Don't think it's going away. The amount of money being invested in data centers is obscene. And they are going to find a way to make their money back. I will say with the tariffs, though, today we saw an interesting bid in silver and gold with the tariff discussion, which I think that probably… Was it reflected in the idea that given how tariffs are ruled, there's less confidence in what's going on economically?

DAREN BLONSKI CFP®: So we saw gold catch a bit. We saw silver catch a bit. Maybe it's not dead yet. We'll see. But still, from a charter's perspective, we're still in that resistance area right here.

DAREN BLONSKI CFP®: And I think until that... We work above that. We won't really know.

DAREN BLONSKI CFP®: To your point earlier and to when we kicked off today, so last week we talked about oil and we were looking at what's happening in oil. And you can see we had this red candle and it looked like resistance. And we're like, well, maybe things are going to calm down in the Middle East.

DAREN BLONSKI CFP®: We're still, you know, it's not actually going to be a war with Iran. And then we got this pretty good size green candle. Which is the market saying, ooh, maybe not. Maybe oil things are going to heat up for a while.

DAREN BLONSKI CFP®: Interesting geopolitical tension, though, because if we take out Iran, we already took Venezuela oil away from the Chinese, at least we're charging them for it now, I guess. And if we take Iran's oil away from the Chinese, that's going to maybe calm things down with Taiwan. I Don't put them in quite the predicament, though. And lo and behold, China... And Russia decided to do some military drills over there.

DAREN BLONSKI CFP®: So things I think are heating up and the market might be indicating that. But again, going back to FlightTracker data, we're not there yet. Betting markets suggest it's more likely, but not 100%. And Bitcoin, left for dead. It is the poor, awful, hideous asset class. Who would dare want to own it? And it's over. Well, just kidding.

DAREN BLONSKI CFP®: It looks like what's happened is we're just trading in this sideways channel here, finding support on that 200-week moving average, which is, I think, positive overall. It doesn't look like it's necessarily bottom, perhaps bottom. It's consolidating, but I would not bet on that chart either way yet. There's just not enough confirmation in it for me. We get above $70,000 again, then I think we're back in the ballgame.

DAREN BLONSKI CFP®: But right now we're just looking like we're either hanging out in the bottom between $70,000, $60,000 in range. I think it's going to be pretty tough for it to go much below $58,000 if it's going to remain a serious asset class. But for those who feel like, oh, yeah, I never got in, this is not a bad time, right?

DAREN BLONSKI CFP®: I'm not suggesting you should buy it because I Don't know your financial situation, but if you've been looking for it, coming down into this blue line is historically. Been a good time. If you think it's still an asset class, it's going to continue to appreciate for you. It's not awful. Everyone always loves to buy it way up here. And then when it's left for dead, no more.

DANO WEIR: Here's a perfect example too, to put it into a Sonoma County context. There were houses in 2008 and 2009 that were in the 200 and 300 thousands that you, again, 10-foot pole. Oh, that's a foreclosure. That's a this. That's a that. And we sit here in 2026 and those just look up the appreciation on some of those. It would be a similar type of emotion around buying Bitcoin right now, kind of like houses in 2009.

DAREN BLONSKI CFP®: Yeah, for sure. So I Don't, you know, again, I think you have to evaluate whether or not you think that Bitcoin is a viable asset or not, right? There's lots of speculation there and lots of feelings about it. I certainly have an opinion about it, but it's just an opinion. Which is what?

DANO WEIR: Which is what?

DAREN BLONSKI CFP®: I think it's, I mean, my personal opinion is that it's a great time to buy, like historically along this blue line. You can see it's been an excellent time to buy it, historically. If history's over, then yeah, you wouldn't want to buy it here.

DAREN BLONSKI CFP®: It's lost for dead, but it's right at a perfect kind of on-sale period. This 200-period moving average over time has just gone down, support, gone down, support, gone up, support, support, support, gone up, now we're into support again. But notice the trend is up and to the right.

DAREN BLONSKI CFP®: That's when you buy. You Don't buy up here when Uncle Vinny's talking about it. I think it's actually good for all investors to have those two to three people in their life that always buy at the top, and they're always the ones who text or call you back, hey, man, I'm thinking about silver. That's the sign. Put your shorts on. Canary in the coal mine people are remarkable.

DANO WEIR: The Uncle Vinny indicator.

DAREN BLONSKI CFP®: Right? Perfect. So you need them in your life.

DAREN BLONSKI CFP®: What we are seeing though is RSP, which is the equally weighted S&P 500. And you can see it just taking off. And this is what I was talking about earlier versus the SPY is kind of rolling over. When we give every one of those boxes in the S&P an equal weighting, S&P is on a rocket ship right now.

DAREN BLONSKI CFP®: And so I think that's why people might be a little bit confused. When you hear about the S&P 500 in the media, they're like, oh, it's the cap-weighted S&P 500 index. When you look at the equally-weighted S&P 500, it's on a tear and doing really well. One of my theses that I have is that we're going into midterm elections.

DAREN BLONSKI CFP®: The economy, they got to keep the economy going strong. If the Trump administration can achieve it, they're going to keep pushing money into the economy and keep pushing this thing. And now they might have actually just got a $150 billion check. So we'll see.

DAREN BLONSKI CFP®: But I think overall, pretty difficult to bet against the stock market right now. The thing is, though, the media is not reporting the equally weighted index to you all. They're just reporting the cap weighted index. But the stock market is actually doing quite well. When you look at it holistically.

DANO WEIR: Yeah, I'm not sure they even necessarily, the average reporter, I Don't want to speak, who knows, but not a lot of people understand the difference between the two. And this, by the way, would speak to the advantages, at least at this moment, to working with an advisor or having a little bit more than just, quote, an index fund, because there's a lot of safety that people feel that way.

DANO WEIR: They just throw out an index fund. It just follows the market. Well, it follows that... Depending on what you buy, it follows the weighted market, you know, versus if it's all equal, you know, you can see the difference right here at this moment.

DAREN BLONSKI CFP®: Yeah, I think that's well said. I think most people Don't know, right? And they think, oh, the market. Well, what is the market? Is it, you know, the Dow that Bondi was running her mouth about in front of Congress? Or is it the S&P 500 or is it the equally weighted?

DAREN BLONSKI CFP®: One thing that advisors help with do is help people understand there's a lot more complexity to it. And so if you just bought the S&P 500, your year hasn't been as good as if you bought an equally weighted. But if you bought the equally weighted the last couple of years, you weren't happy because it wasn't ripping like the cap weights.

DAREN BLONSKI CFP®: Because the mags, which were the big components of the S&P cap weighted index, were the ones that were growing. This year, they're down. And this is rotation, right? So you see these rotations towards the end of the business cycle. And it's certainly playing out great right now.

DAREN BLONSKI CFP®: We would expect, I say great as an advisor, because frankly, we found it quite annoying that all the money was flowing into the Mag7 because everything in our brain as advisors goes, man, you can't concentrate like that. That's a bad move. And that's very frustrating to watch a market just rip when it's not. Promoting good behavior.

DANO WEIR: So to our clients who are hanging tough, we love you.

DANO WEIR: What we've always talked about is at least happening at the moment, the rotation. Darren, any others? Or you sound like you're wrapping up there.

DAREN BLONSKI CFP®: No, I think that's what I wanted to hit today. I think overall market looks really strong and Don't bet against it this time. And I think there's some things coming at us in midterms and historically.

DAREN BLONSKI CFP®: It's not a good move to bet against the market going into midterms.

DANO WEIR: I want to clarify that this graphic we used this week was trying to show shipping routes via air and not missile strikes. So no tariffs or at least less tariffs, massively less tariffs. Now what? The answer is, at least at the moment, not a strong reaction one way or another from the market and potentially.

DANO WEIR: If there's $150 billion that may be being refunded directly to companies, that may have a huge impact On The Market. And depending on how you're invested, you could be sitting good right now. Thank you so much for checking out our show. This is On The Market. We are Cinema Wealth Advisors, the private wealth brand of Fermata Advisors, the Fermata family of brands.

DANO WEIR: Wherever you found this show, We'd love for you to subscribe so you Don't miss future episodes. Whether it's Spotify, Apple Podcasts for the audio, the full video broadcast on YouTube, and also on our website, cinemawelf.com, where you can learn about our wealth analysis. We will see you next week.

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