[SPEAKER_09]: on radio on YouTube, streaming live on investtalk.com, and for our podcast subscribers, this is Invest Talk, independent thinking, shared success.

[SPEAKER_09]: Invest talk is made possible by KPP Financial, a registered investment advisor firm, serving clients throughout the United States.

[SPEAKER_09]: Here is KPP Financial Chief Executive Officer, Financial Advisor, Justin Klein.

[SPEAKER_05]: Good afternoon fellow investors and welcome back to Invest Talk.

[SPEAKER_05]: This is our Thursday August, four teeth, twenty twenty five edition of the best talk.

[SPEAKER_05]: Appreciate you all tuning in for this hour and excited to help you become a better investor.

[SPEAKER_05]: That's what this hour is always dedicated for.

[SPEAKER_05]: Dance to your finance and investment questions.

[SPEAKER_05]: Give you perspective and data.

[SPEAKER_05]: based on history, based on current market trends, et cetera, that you can take back to your own personal situation and make better decisions with, right?

[SPEAKER_05]: Being able to balance out risk versus reward, avoid pitfalls, and capitalize on opportunities.

[SPEAKER_05]: So we're here for you.

[SPEAKER_05]: The show is dedicated to you each and every weekday, and in just a bit, we'll talk about today's market performance and run down the show topics.

[SPEAKER_05]: But as usual, let's tackle this first-color question now.

[SPEAKER_02]: I am calling to get your opinion on Gillian.

[SPEAKER_02]: The symbol is G-I-L-D.

[SPEAKER_02]: So I'm just wanted to see what that look is for the company and just what your thoughts are.

[SPEAKER_02]: They're too hold or you think it's time to get out and get into something else.

[SPEAKER_02]: So I'll be listening to the answer on your podcast.

[SPEAKER_02]: Thanks again.

[SPEAKER_02]: Bye.

[SPEAKER_05]: All right, this is Gilliatte scientists, biotech name, and it has at a choppy growth story, earnings is here, so it's really four, sorry, earnings last year were four dollars and sixty cents, but this year is to be at the eight dollars and ten cents that will be in all time high, if that comes to fruition.

[SPEAKER_05]: And that's why the stock is near and all time high around a hundred twenty dollars per share.

[SPEAKER_05]: So it's trends are pretty solid on the earnings front, even though historically it's been kind of up and down.

[SPEAKER_05]: Now, this is the name that basically cured hepatitis, I think it was B or C a camera, which one it was.

[SPEAKER_05]: But it did so well.

[SPEAKER_05]: It actually can't apply as their business that everyone was cured.

[SPEAKER_05]: So they had no more customers.

[SPEAKER_05]: You know, they have made some acquisitions throughout the years to try to broaden out their portfolio.

[SPEAKER_05]: And they've pretty done a pretty decent job at that.

[SPEAKER_05]: I believe they also have HIV medications, et cetera.

[SPEAKER_05]: Yeah, they're business peaked out back until in fifteen at nineteen billion dollars in free cash flow.

[SPEAKER_05]: That's come back down and it's been trending between eight and ten billion basically since two thousand and let's call it eighteen.

[SPEAKER_05]: So the good news is you're seeing some steadiness, but there's not a lot of growth there.

[SPEAKER_05]: Okay, return equity is thirty three percent.

[SPEAKER_05]: That's good.

[SPEAKER_05]: Only about twenty billion dollars of net debt in this balance, you know, a hundred forty seven billion dollar market cap.

[SPEAKER_05]: So the overall balance sheet is pretty strong.

[SPEAKER_05]: So I don't have any issues there.

[SPEAKER_05]: I like the profitability, et cetera.

[SPEAKER_05]: And you know, earnings just we have seventy five percent this year, six percent next year.

[SPEAKER_05]: Based on forward-looking multiples, it's at the mid-teens.

[SPEAKER_05]: I would, I would hold it to be honest with you.

[SPEAKER_05]: I think the trends are fine.

[SPEAKER_05]: There's no real issue with the technical, other another chart yet.

[SPEAKER_05]: The technicals are fine.

[SPEAKER_05]: It's a bit over-bought near-term, but there are a lot of things that over-bought.

[SPEAKER_05]: I would hold it for now.

[SPEAKER_05]: I have no issue with it.

[SPEAKER_05]: I like the balance sheet.

[SPEAKER_05]: I like the consistency of the business.

[SPEAKER_05]: And it's not trading at unreasonable valuations here at about ten times forward-looking enterprise value even though.

[SPEAKER_05]: I'm okay with Gillia, G-I-L-D.

[SPEAKER_05]: Now we have a lot of ground to cover over the next forty-five minutes and our main focus point is about how to recession proof your portfolio.

[SPEAKER_05]: And what can you pivot into if we are headed into a recession now?

[SPEAKER_05]: Granted, we're still in a growth phase.

[SPEAKER_05]: But it's pretty clear we're getting the latter innings of that growth phase.

[SPEAKER_05]: Which means that at some point, probably over the next twelve to twenty four months, we're going to enter a more challenging market environment.

[SPEAKER_05]: That's just the reality of the situation.

[SPEAKER_05]: So how do you prepare for that?

[SPEAKER_05]: Now, it may not be today, but you need to be prepared to pivot to restructure, to rebalance your portfolios.

[SPEAKER_05]: Okay, so we'll dig into that story.

[SPEAKER_05]: In addition, we have other topics.

[SPEAKER_05]: One, I want to get to is the jobs numbers.

[SPEAKER_05]: Now, there's a lot of controversy around President Trump's firing of the head of the VLS.

[SPEAKER_05]: And, well, I find some of those arguments to have merit.

[SPEAKER_05]: It's not the end of the world, even if we never get another

[SPEAKER_05]: Monthly jobs number because there are other data points to look at.

[SPEAKER_05]: We get data points and I'll dig into what those data points are and they're pretty clear.

[SPEAKER_05]: They're pretty.

[SPEAKER_05]: There's not really much up to interpretation in them.

[SPEAKER_05]: So we'll take a look at that.

[SPEAKER_05]: We also want to touch a bit on kind of the shift in how business standard American now.

[SPEAKER_05]: You know, it's always been a bit of a, you call it crop system.

[SPEAKER_05]: But even more, it's becoming, it's becoming China-like, really, which is interesting.

[SPEAKER_05]: So we'll talk about that.

[SPEAKER_05]: What are the pros and what are the drawbacks?

[SPEAKER_05]: Well, let's get voice bank questions.

[SPEAKER_05]: One is on DoorDash and the other is on Compound, Frequency.

[SPEAKER_05]: And then we have some questions that came in that came in via the comment section over on the Invest Talk YouTube channels.

[SPEAKER_05]: Well, and of course, I welcome your live calls, your finance and investment questions right now.

[SPEAKER_05]: At eight and eight and eight and nine and chart, but we're gonna head into a quick break.

[SPEAKER_05]: Please remember that you can call any time and leave your question on the Invest Talk voice bank.

[SPEAKER_05]: Or if you're listening to me the live stream, we love your live calls and you can call now.

[SPEAKER_05]: Once again, the number is eight and eight and nine chart.

[SPEAKER_08]: Okay, gotta get serious with my finances.

[SPEAKER_08]: I've been working a long time and I know there's still gotta be more that I can do to build my wealth quicker.

[SPEAKER_08]: I don't wanna have to work forever.

[SPEAKER_05]: If you are not maximizing your employer's sponsor retirement plan, KPP Financial can help.

[SPEAKER_05]: With our professional oversight, you can potentially enhance your investment performance by an average of three percent annually.

[SPEAKER_05]: At KPP Financial, we provide a comprehensive four-of-one K-management program designed to optimize your retirement savings.

[SPEAKER_05]: Our approach includes creating custom investment allocations tailored to your goals and risk tolerance.

[SPEAKER_05]: That can make a big difference in your favor.

[SPEAKER_08]: and maybe it's time to tune up my retirement plan.

[SPEAKER_05]: For more information on how you can take control of your retirement savings, visit our website KPPFinancial.com KPPFinancial sounds good.

[SPEAKER_07]: Your questions are free.

[SPEAKER_07]: The answers are unbiased.

[SPEAKER_07]: Justin Klein is here now.

[SPEAKER_07]: Ready to take your calls live.

[SPEAKER_07]: Invest talk.

[SPEAKER_07]: Eight, eight, ninety-nine chart.

[SPEAKER_05]: Those could take a quick look at the market today, and it was a modest down day overall.

[SPEAKER_05]: You had the, sorry, let me.

[SPEAKER_05]: With the S&P was flat, roughly.

[SPEAKER_05]: The Dow was down to eleven points.

[SPEAKER_05]: The NASDAQ was down sixteen points.

[SPEAKER_05]: The only three sectors that were positive, health care, financials, and communications barely dealt out of gain.

[SPEAKER_05]: You had materials down the most as well as consumer staples and industrials.

[SPEAKER_05]: Tech was kind of middleing down about two basis points there.

[SPEAKER_05]: And remember, this is opx week.

[SPEAKER_05]: Opx week you typically don't you get kind of, uh, jogging position for positioning some maneuvering and there's really not a whole lot that tends to move.

[SPEAKER_05]: until the week after.

[SPEAKER_05]: That's when a lot of options expired.

[SPEAKER_05]: I've expired and now books are when it says, hey, books, I mean, market making books and and speculator books are are reshuffled.

[SPEAKER_05]: And more volatility can commence and therefore you get more market movement.

[SPEAKER_05]: So not surprising to see today being what we call a pin day just didn't really move a whole lot.

[SPEAKER_05]: one way or the other.

[SPEAKER_05]: And I'm expecting more action tomorrow.

[SPEAKER_05]: Sorry, I'm Monday and into next week.

[SPEAKER_05]: And what's interesting about today's pin was really we had economic numbers that certainly should move the market.

[SPEAKER_05]: Okay.

[SPEAKER_05]: And it was mainly the PPI.

[SPEAKER_05]: So on Tuesday, we had the CPI number.

[SPEAKER_05]: And that was kind of mixed.

[SPEAKER_05]: I talked about it how the really wasn't acceleration and physical products, inflation, but services definitely saw inflation.

[SPEAKER_05]: But the PPI, remember the CPI, it's kind of

[SPEAKER_05]: lagging in a way.

[SPEAKER_05]: You can argue it's coincidental, but you have leading indicators, coincidental indicators, and lagging indicators.

[SPEAKER_05]: CPI is definitely not a leading indicator, but PPI is, because this is the producer price index.

[SPEAKER_05]: And so what it's saying is, how much are the producers paying for their goods and services?

[SPEAKER_05]: And that

[SPEAKER_05]: Typically, over time, usually in a two to three month lag, feeds into the CPI.

[SPEAKER_05]: Because eventually, that inventory needs to be rolled over and sold to the public, to the consumer, to other businesses, and that will hit the market, right?

[SPEAKER_05]: Those prices will change if the producers are paying more for their goods.

[SPEAKER_05]: Now the consensus was for an expectation of the PPI going up point two percent.

[SPEAKER_05]: But they went up point nine percent.

[SPEAKER_05]: Point nine percent.

[SPEAKER_05]: Okay.

[SPEAKER_05]: That is a huge jump.

[SPEAKER_05]: And this is the sharpest increase since March of twenty twenty two.

[SPEAKER_05]: The annualized headline is now three point three percent.

[SPEAKER_05]: Consensus was supposed to count at two point four percent.

[SPEAKER_05]: Remember I said this.

[SPEAKER_05]: I said this a few months ago that we would get in the back after this year a reacceleration of inflation back above three percent.

[SPEAKER_05]: Now I didn't expect it to start hitting this kind of early but

[SPEAKER_05]: You know, that's the first month of the second half of the year.

[SPEAKER_05]: And you're starting to get it.

[SPEAKER_05]: Now this is likely going to feed into the CPI figure for September, October.

[SPEAKER_05]: Okay.

[SPEAKER_05]: Now core PPI that also rose.

[SPEAKER_05]: Point nine percent.

[SPEAKER_05]: So you might say let's strip out food and energy the more volatile side of the of the number.

[SPEAKER_05]: And what does that look like?

[SPEAKER_05]: And the consensus was again, point two percent and it also came in at point nine percent.

[SPEAKER_05]: annualized cores now three point seven percent consents was two point nine

[SPEAKER_05]: June's number was two point six.

[SPEAKER_05]: So we've not from two point six, the three point seven over a hundred basis point increase year over year in just two months.

[SPEAKER_05]: Now the good news here is final demand for services rose one point one percent.

[SPEAKER_05]: The largest since March of twenty of twenty two.

[SPEAKER_05]: So demand is still good, but prices are continued to be higher.

[SPEAKER_05]: So the inflation picture continues to worsen.

[SPEAKER_05]: Prices for final demand goods increase point seven percent, the largest since January.

[SPEAKER_05]: So that was the bad news on the inflation front, clearly bad news that will likely feed in the CPI.

[SPEAKER_05]: Initial jobless claims though, that was kind of the good news, came in at two hundred twenty four thousand consensus two hundred thirty thousand, continuing claims, decelerated, consensus was

[SPEAKER_05]: one point nine six million came in at one point nine five three million so a bit better than was expected a bit of a drop from last weeks but still we're kind of still knocking on the door about two million people on the unemployment goals and

[SPEAKER_05]: So you still have a weakening labor market, not necessarily a terrible one because not getting a lot of layoffs, but you're not getting a lot of hiring's either.

[SPEAKER_05]: And so you have a middleing to a weak jobs picture, and you have an inflation picture that is starting to heat up once again.

[SPEAKER_05]: And so you really didn't see, you really didn't see a whole lot of movement on markets, especially because it was that

[SPEAKER_05]: that opx week, okay?

[SPEAKER_05]: So something that we'll be continuing to watch Friday will get a retail sales report, okay?

[SPEAKER_05]: So expect to see some cooling, so that'll be more economic news on the consumer tomorrow.

[SPEAKER_05]: It will what else happened today?

[SPEAKER_05]: Treasures were weaker across the curve, less of a chance now that the federal cut may be fifty basis points, probably only be at twenty five basis point cut.

[SPEAKER_05]: And if you get another hot inflation print for the month of August, do you get

[SPEAKER_05]: a fed that pauses and waits even longer, right?

[SPEAKER_05]: So that would be something to watch.

[SPEAKER_05]: The dollar next was about point two percent.

[SPEAKER_05]: Goldfinish down point seven percent.

[SPEAKER_05]: Bitcoin was about three point nine percent on.

[SPEAKER_05]: Best in the comments.

[SPEAKER_05]: Secretary, best in the comments about US not buying more crypto.

[SPEAKER_05]: Okay.

[SPEAKER_05]: WTI crude sell down.

[SPEAKER_05]: Sorry, up to two point.

[SPEAKER_05]: one percent near its best levels of the week.

[SPEAKER_05]: So that was the market today, very interesting economic news and market changes, which really weren't a whole lot.

[SPEAKER_05]: Now we're moving into a break.

[SPEAKER_05]: Still the comment.

[SPEAKER_05]: My focus point and more answers to your questions.

[SPEAKER_05]: So I encourage you to call right now with anything money related that is on your mind.

[SPEAKER_05]: No questions too simple or too complex.

[SPEAKER_05]: Give us a call right now at eight and eight ninety nine chart.

[SPEAKER_09]: Got a question for Justin or Luke?

[SPEAKER_09]: You're the best person to ask it.

[SPEAKER_09]: Good question.

[SPEAKER_03]: What are some signs of a set of recessions coming?

[SPEAKER_06]: It's only lesson for people who own stocks, even if they don't short a stock that the stock they own, they should know whether it's been heavily shorted.

[SPEAKER_05]: Invest talk is ready, twenty four seven.

[SPEAKER_05]: If this gets to one seventy to one seventy five in that range, that's where I pick it up.

[SPEAKER_05]: Thank you, Jeff.

[SPEAKER_05]: I appreciate it.

[SPEAKER_01]: I'm hoping you'll give me your take on or Matt Technology ORA.

[SPEAKER_01]: Curious if you think it'd be better for me to let it go and send money elsewhere.

[SPEAKER_06]: I'm a new investor in your podcast to help me out a lot.

[SPEAKER_09]: Call in Vestock.

[SPEAKER_09]: Eight a day, ninety nine chart or post your questions on the Invest Talk YouTube channel.

[SPEAKER_07]: Have you heard about the new Invest Talk Store?

[SPEAKER_07]: That's right.

[SPEAKER_07]: You'll find great merch for the savvy investor.

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[SPEAKER_07]: And now Justin Klein is here and taking your finance and investment questions live.

[SPEAKER_07]: Call Invest Talk.

[SPEAKER_05]: In the first thing you have to understand about a potential recession, which, like I said at the top of the show, we probably get one, say, in this Trump presidency.

[SPEAKER_05]: Right, we're in the latter stages, but most likely eighth inning, I call it top of the eight, this probably where we're at.

[SPEAKER_05]: I'm gonna pinpoint.

[SPEAKER_05]: Right, more time in the clock, but, you know, we're in the latter innings.

[SPEAKER_05]: Now, the first thing you have to understand about a recession is that not all of them mean a major decline in the stock market.

[SPEAKER_05]: In fact, five of the eleven recessions in the U.S.

[SPEAKER_05]: economy since nineteen fifty showed positive stock returns.

[SPEAKER_05]: Do you know that?

[SPEAKER_05]: Five of the eleven.

[SPEAKER_05]: So don't presume that just because you have a recession that you have to see major equity losses.

[SPEAKER_05]: Now, usually there are sectors that do very poorly, others do well, and you can still have a market that rises, right?

[SPEAKER_05]: So the big question is, in this market is what happens with tech, or because it's such a heavily weighted part of the market these days, especially the indexes.

[SPEAKER_05]: Now, it was directly though, there are certain sectors that hold them well, that, or say asset classes that hold them well, that tend to thrive in a recession.

[SPEAKER_05]: Let's just say that.

[SPEAKER_05]: Now, the first one is obviously golden.

[SPEAKER_05]: We're already seeing it thrive of thirty plus percent year to date where the S&P is holding the up around eight percent.

[SPEAKER_05]: And so it's a hedge against both geopolitical and economic risks.

[SPEAKER_05]: And you're already seeing other tailwinds as well like central banks around the world buying more and more.

[SPEAKER_05]: In fact, the World Gold Council survey shows forty three percent of central banks plan to increase the reserves in gold in the coming year.

[SPEAKER_05]: That's up from twenty nine percent last year.

[SPEAKER_05]: So, how many ways gold is the international currency?

[SPEAKER_05]: Okay.

[SPEAKER_05]: So that's number one and I think everybody needs to have some exposure there.

[SPEAKER_05]: Number two, U.S.

[SPEAKER_05]: Treasury bonds.

[SPEAKER_05]: Now, the big question here in this environment is, what's hyper U.S.

[SPEAKER_05]: Treasury bonds?

[SPEAKER_05]: Historically, longer-term Treasury bonds have been a good thing, right?

[SPEAKER_05]: They rates of fallen, especially since the early eighties, during recession, rates of fallen, and that has made longer-term treasuries a smart way to go.

[SPEAKER_05]: However, in this environment, if it's a more inflationary recession, and I could see that as well, right?

[SPEAKER_05]: If inflation continues to climb into the threes, maybe into the thours, and you get an economy, normally, that now dips below that number, your real growth is negative.

[SPEAKER_05]: Normally, you're still going up, and that's one of the reasons why a lot of recessions, you still get equities going up because earnings are priced.

[SPEAKER_05]: Normally, they're not priced in real terms, right?

[SPEAKER_05]: So if nominal growth of the economy is still going up, but inflation is now higher now, sort of two quarters in a row, you get some sort of sell-off in the credit markets.

[SPEAKER_05]: to where there's tougher economic times in general, that is recession.

[SPEAKER_05]: I think that's more likely what we're seeing going forward.

[SPEAKER_05]: A lot of people think of recession.

[SPEAKER_05]: They think, oh, eight.

[SPEAKER_05]: Oh, eight was a financial crisis.

[SPEAKER_05]: Very different.

[SPEAKER_05]: Most recessions are similar to the two thousand, two thousand, three recession.

[SPEAKER_05]: Or in that in that period.

[SPEAKER_05]: It's called the two thousand and two recession.

[SPEAKER_05]: I think was the official time when we went and do a recession.

[SPEAKER_05]: And then you know, you go back to the early nineties because then any one recession.

[SPEAKER_05]: You know, those are more typical recessions.

[SPEAKER_05]: Okay.

[SPEAKER_05]: And that's most likely what is what will happen in the future.

[SPEAKER_05]: So treasury bonds, but in this environment, I would say shorter duration.

[SPEAKER_05]: Then there's dividend paying stocks.

[SPEAKER_05]: Now dividend paying stocks typically have stronger balance sheets, they're your cash flows.

[SPEAKER_05]: But you don't want to buy any dividend paying stock.

[SPEAKER_05]: You definitely want to focus more on sectors that are non-cyclical.

[SPEAKER_05]: And that's where you get into the next one, which is defensive sectors.

[SPEAKER_05]: So your typical defenses, defensives are utilities, staples, healthcare.

[SPEAKER_05]: You could say some parts of technology as well that are, the business is very sticky.

[SPEAKER_05]: That isn't predicated on advertising, for example.

[SPEAKER_05]: I would think Apple is becoming more of a defensive tech because the iPhone is so integral, you're gonna have an iPhone, no matter what, you might slow your upgrade cycle, but if your iPhone breaks, you're probably still buying a new iPhone, you know, whether times are good or not, that's type of thing.

[SPEAKER_05]: I would say defensive sectors, but also defensive companies, right?

[SPEAKER_05]: Companies that are less cyclical.

[SPEAKER_05]: So there are retailers that are very cyclical that sell maybe electronics that aren't need to buy in a recession for the most part versus certain retailers that sell a lot of toothpaste and shampoo and toilet paper, et cetera, those would be more recession-proof.

[SPEAKER_05]: So it depends on the company, really.

[SPEAKER_05]: And then there's high-quality corporate bonds.

[SPEAKER_05]: You're talking the corporate balance sheets, especially your public companies these days, they're pretty good.

[SPEAKER_05]: So buying corporate's getting a little better yield, that can be a good defensive allocation as well.

[SPEAKER_05]: And then lastly, REITs.

[SPEAKER_05]: REITs are, it can be a good place to be a pay-consistent dividends.

[SPEAKER_05]: A lot of times, their rents are steady.

[SPEAKER_05]: No matter the economic times depends on the type of

[SPEAKER_05]: of retail, it was an apartment, rent, health care, rent, warehouse, et cetera.

[SPEAKER_05]: Obviously, a health care, rent is going to be stickier than a warehouse, rent.

[SPEAKER_05]: Instead of your than a warehouse, rent.

[SPEAKER_05]: So make sure you understand that the difference between the different rates and then obviously cash can be a good place to hide, per part of the portfolio, but you don't want to stay there for very long.

[SPEAKER_05]: Now we're heading into our final break, or not federal break, midpoint of the show.

[SPEAKER_05]: But we're ready to take your calls now at eight and eight and nine chart.

[SPEAKER_07]: Twenty, twenty-five rolls on and you might have some fresh questions for Justin or Luke.

[SPEAKER_07]: Call in Vestalk, eight, eight, eight, ninety-nine chart.

[SPEAKER_04]: Louis here from Raleigh, North Carolina, long time listener, first time call it.

[SPEAKER_04]: Reason for my call is that like to get your take on J.B.

[SPEAKER_04]: Aviation, ticker symbol J.O.B.

[SPEAKER_04]: isn't boy.

[SPEAKER_04]: Why?

[SPEAKER_04]: There's not a whole lot of information out there that I can gather.

[SPEAKER_04]: So I'd like to see if you could take a look at it and tell me what you think.

[SPEAKER_04]: I'll listen to your response in the air.

[SPEAKER_04]: Thank you.

[SPEAKER_04]: Have great day.

[SPEAKER_05]: All right.

[SPEAKER_05]: Looking at Jobi, Jobi, however you want to pronounce it, there's plenty of information out there.

[SPEAKER_05]: They're team almost fourteen billion dollar market cap.

[SPEAKER_05]: No revenue.

[SPEAKER_05]: This is the epitome of

[SPEAKER_05]: the type of company that you want to stay far, far, far, far away from.

[SPEAKER_05]: Okay, this is a story stock to the end degree.

[SPEAKER_05]: to the end degree.

[SPEAKER_05]: You don't want to be owning these type of names.

[SPEAKER_05]: They lose money every single year and think about this.

[SPEAKER_05]: Okay.

[SPEAKER_05]: What they do is they develop all electric vertical takeoff and landing air taxis.

[SPEAKER_05]: They're helicopters.

[SPEAKER_05]: They're their personal drones.

[SPEAKER_05]: They're drones that a person can get into.

[SPEAKER_05]: Okay.

[SPEAKER_05]: And I think that's

[SPEAKER_05]: cute, it's a novelty, but do you think are going to have these flying drones with people in them?

[SPEAKER_05]: You think about the safety of that, okay?

[SPEAKER_05]: And you're going to have thousands of them, tens of thousands of them flying around anytime soon without any semblance of, you know, what's the safety across different cities?

[SPEAKER_05]: I just don't see this coming to fruition at any point at any reasonable length of time.

[SPEAKER_05]: Now, fifty years now, hundred years now, sure, you build an AI and you get faster chips that can control everything and we could get there at some point.

[SPEAKER_05]: But at any time soon, and until then, it's just going to be issuing more and more shares and deluding shareholders.

[SPEAKER_05]: And that's all this is going to be.

[SPEAKER_05]: This is a pump job.

[SPEAKER_05]: And in fact, this is one of the best companies to short over probably the next three to five years.

[SPEAKER_05]: This is one of the worst companies you can invest in in today's market hands down.

[SPEAKER_05]: Like I said, pretty much the revenue.

[SPEAKER_05]: One of the revenue is ninety eight thousand dollars training twelve months.

[SPEAKER_05]: About eighty ninety eight million.

[SPEAKER_05]: Not nine hundred eighty thousand.

[SPEAKER_05]: Dugment ninety eight thousand dollars.

[SPEAKER_05]: They lost eight hundred million dollars of the trillion trillion filaments.

[SPEAKER_05]: The free cash flow is negative five hundred million.

[SPEAKER_05]: There is nothing, and I mean nothing about this company that is attractive from an investment standpoint.

[SPEAKER_05]: This is one hundred percent a story stock.

[SPEAKER_05]: And the fact that this has gone up so much recently just tells you about the froth in today's market.

[SPEAKER_05]: This has gone from five to seventeen dollars to a high recently around twenty dollars in the span of basically since April, this is one of the best shorts in the market.

[SPEAKER_05]: So no, you don't want to own this, you want to sell this.

[SPEAKER_05]: Dave Ontario says, thanks for all you do.

[SPEAKER_05]: I look forward to your daily podcast, especially the weekly YouTube summaries.

[SPEAKER_05]: Question was it mean when a company's earnings are supposed to be twenty nine cents and twenty twenty five, twenty seven two cents and twenty six and a dollar one and twenty seven, then down to seventy five cents in twenty twenty eight, but revenues supposed to increase every year is that debt due in twenty twenty eight, I'm looking at capstone copper TSX.

[SPEAKER_05]: CS.TO using trade view of my fundamental numbers.

[SPEAKER_05]: So looking at CS.TO, let me see if I can pull this up.

[SPEAKER_05]: Here we go.

[SPEAKER_05]: Capsstone Copper.

[SPEAKER_05]: Well, so first after you, you have to understand that paying back debt isn't a hit to earnings, okay?

[SPEAKER_05]: Just because they're paying back debt, that's just, that's called a, it goes under cash from financing operations, right?

[SPEAKER_05]: They paying back debt, or they issuing debt, issuing shares, et cetera.

[SPEAKER_05]: That doesn't hit the income statement.

[SPEAKER_05]: Okay.

[SPEAKER_05]: So that's number one.

[SPEAKER_05]: Now, else are projecting out.

[SPEAKER_05]: I'm not sure why it would dip, you know, maybe they're thinking there's additional costs that are being pushed on them at that point in twenty twenty eight.

[SPEAKER_05]: Maybe there are there's some sort of depreciation, schedule, where it pushes

[SPEAKER_05]: certain costs that are depreciated in that year, I'm not sure exactly what is causing a top drop.

[SPEAKER_05]: Maybe it's a lease on a mine that maybe going away, or maybe the life of that mine ends in a couple of years, right?

[SPEAKER_05]: That could be possible as well.

[SPEAKER_05]: And then no longer is expected to have revenue from that mine.

[SPEAKER_05]: I don't know exactly if it dig into this one in particular.

[SPEAKER_05]: Now I tend to like

[SPEAKER_05]: proper producers.

[SPEAKER_05]: I think long-term, one of those rare commodities that new supply can't be turned on in a switch, and that tends to be good for these types of names.

[SPEAKER_05]: So I like the chart.

[SPEAKER_05]: It's definitely in an uptrend, let me see if I can.

[SPEAKER_05]: But the chart looks pretty good.

[SPEAKER_05]: It's not super profitable, but I like the trends.

[SPEAKER_05]: It's obviously very volatile.

[SPEAKER_05]: It's a small cap name, about seven billion dollar market cap.

[SPEAKER_05]: A little bit of debt, like you said, not that big of a deal.

[SPEAKER_05]: Return equity is pretty low, though, two points, seven percent.

[SPEAKER_05]: Don't love that.

[SPEAKER_05]: I think there are better names out there, but I like the chart.

[SPEAKER_05]: And if you're looking for an aggressive way to play copper, this would be one of them.

[SPEAKER_05]: Thanks for the call.

[SPEAKER_05]: with the question.

[SPEAKER_05]: Now, there's been a recent firing of the BLS head, and I think while it's an interesting story to talk about, luckily for Wall Street, that number is not the end-all BL.

[SPEAKER_05]: Since the pandemic, basically, it's a survey.

[SPEAKER_05]: It's sent out to businesses, and the BLS is just compiling the results of the survey, and

[SPEAKER_05]: Basically, since the pandemic, it's been sent back a lot slower.

[SPEAKER_05]: And so that's why the revisions have been so big, not just recently, but really for the past two, three, four years.

[SPEAKER_05]: And how the number has been relatively inaccurate, at least the initial number, right after three months, then they get all the surveys back, and they have a clear review.

[SPEAKER_05]: There are some ways that probably that number can be compiled a lot more accurately, but not doing it all, which is the new BLS suggestion is, or do it once a quarter, maybe.

[SPEAKER_05]: And it will be see, we'll see how it evolves.

[SPEAKER_05]: But, needless to say, once again, that's not the end of the other other numbers to really look at, okay?

[SPEAKER_05]: And the other one is the unemployment rate currently is at four point two percent.

[SPEAKER_05]: Now as they lagging indicator, but once it starts to rise, the economy probably is already in a rough position.

[SPEAKER_05]: Now if you don't adjust for

[SPEAKER_05]: the low migration levels, and the number of people leaving the workforce, actually the unemployment rate would be approaching five percent currently.

[SPEAKER_05]: So technically, the unemployment rate is already on the rise.

[SPEAKER_05]: So relatively low levels historically, but it is rising.

[SPEAKER_05]: But there are other data points, like I said, you have the Joltz number, the job openings in labor turnover survey, and that showed hiring in June was the weakest in a year.

[SPEAKER_05]: And that's the really the story of the labor marker right now.

[SPEAKER_05]: It's not about layoffs, it's about hiring.

[SPEAKER_05]: Many companies are still scared from the post-pandemic labor shortages, so they don't want to get rid of their workers, but they're slow to add new.

[SPEAKER_05]: Layoffs in June total one point six million, that's below average of the last two, three, and one, two, and three years.

[SPEAKER_05]: So like I said, layoffs are not picking up.

[SPEAKER_05]: But labor force participation in July was six to two point two, the lowest since November of twenty twenty two.

[SPEAKER_05]: Okay.

[SPEAKER_05]: Now the initial claims, like I said, the top of the show, not too bad.

[SPEAKER_05]: But now you have the existing claims.

[SPEAKER_05]: Sorry, continuing claims, continuing claims.

[SPEAKER_05]: And that continues to be on a solid uptrend.

[SPEAKER_05]: So that's another number that you can look at.

[SPEAKER_05]: And that's my favorite number, honestly.

[SPEAKER_05]: Because you can't fake that.

[SPEAKER_05]: It's not a survey.

[SPEAKER_05]: It's how many people have filed front employment and are getting unemployment.

[SPEAKER_05]: Our continuing to get an employment.

[SPEAKER_05]: I mean, checks are being sent out.

[SPEAKER_05]: That's not a survey.

[SPEAKER_05]: That's just government data, total number.

[SPEAKER_05]: And that is very clear.

[SPEAKER_05]: And guess what?

[SPEAKER_05]: You don't have to wait a month.

[SPEAKER_05]: It's a weekly figure.

[SPEAKER_05]: It's about as live look at the labor market as you're ever going to get.

[SPEAKER_05]: And they continue in claims.

[SPEAKER_05]: Calculates both people that are laid off just filing front employment as well as those that find a job.

[SPEAKER_05]: Now, I will say this coming out of recession.

[SPEAKER_05]: It doesn't work that well.

[SPEAKER_05]: Because you've already had a bunch of layoffs.

[SPEAKER_05]: And some of those people, you can only be on unemployment for so long.

[SPEAKER_05]: And in a very rough economic environment, a lot of those people just never find jobs, and now they suddenly can't get an employment or have a job.

[SPEAKER_05]: So it does tend to have a more of a spotty picture coming out of a recession, but going into a recession, or in a weakening labor market, it's a pretty good look.

[SPEAKER_05]: Everyone has their own view on what's important.

[SPEAKER_05]: These are my views, but it's pretty clear that you can

[SPEAKER_05]: You can find this data.

[SPEAKER_05]: The number that comes out the first Friday of every month isn't shouldn't be the only number that you pay attention to.

[SPEAKER_05]: You can also look at things like average hourly hours worked.

[SPEAKER_05]: And the average hourly earnings as well, last month rose three point nine percent.

[SPEAKER_05]: That's about even for the last year.

[SPEAKER_05]: Average number of hours worked, thirty four point three, right at the average for the past two years.

[SPEAKER_05]: So that is also holding up.

[SPEAKER_05]: Well, also.

[SPEAKER_05]: What I want to do here is just give you a picture is there's a lot of other labor data to consider and to watch for than just one number that is usually updated and and revised anyway.

[SPEAKER_05]: Let's keep things moving as soon back to the investment voice bank.

[SPEAKER_05]: You know the number it's eighty-eight ninety-nine chart.

[SPEAKER_06]: Hey, gentlemen.

[SPEAKER_06]: This is Craig from the mountains outside Seattle.

[SPEAKER_06]: I've called a few times before.

[SPEAKER_06]: Hopefully a simple question.

[SPEAKER_06]: I talked to a lot of my friends asked me to talk to their kids after they get their first jobs and

[SPEAKER_06]: kind of introduce them to finance and and investing and so I always start with a compound interest calculator just to you know generate the discussion but when it comes to frequency of compounding for life and me I can't find anywhere to finish on morning star or anywhere else where for a Roth IRA for basic investments for index funds where they specify the compounding schedule is it weekly monthly quarterly annually

[SPEAKER_06]: And I'm wondering how that's determined, you know, obviously the more frequently it compounds the better, but I can't see what determines that or where I would find that in a perspective or anything else.

[SPEAKER_06]: So any information you could provide there that would make it easier to have that discussion and then be able to speak intelligently to it.

[SPEAKER_06]: I greatly appreciate it.

[SPEAKER_06]: Thanks again.

[SPEAKER_06]: Bye bye.

[SPEAKER_05]: The problem.

[SPEAKER_05]: Yeah, that's very simple.

[SPEAKER_05]: It depends on the rate of return you are specifying in that particular

[SPEAKER_05]: Schedule, right?

[SPEAKER_05]: And is it annual return?

[SPEAKER_05]: Is it quarterly, monthly, daily?

[SPEAKER_05]: That's how often it's compounding, right?

[SPEAKER_05]: So if you have a, twenty percent return, and you start at ten thousand dollars, well, after one year, say twenty percent annualized return, annual return, that means you have ten thousand dollars.

[SPEAKER_05]: Next year at the end of that year, you're in twenty percent, you're at twelve thousand dollars.

[SPEAKER_05]: Right?

[SPEAKER_05]: Then the next year, if you're another twenty percent, that's fourteen thousand, four hundred dollars.

[SPEAKER_05]: Right?

[SPEAKER_05]: Because you're adding, you're compounding that money.

[SPEAKER_05]: Right?

[SPEAKER_05]: And so on and so forth.

[SPEAKER_05]: So forth.

[SPEAKER_05]: So it's about the return that you are getting and you're putting in there is it.

[SPEAKER_05]: Once it's going to analyze, returns quarterly, monthly, daily, et cetera.

[SPEAKER_05]: That's the frequency of the compounding.

[SPEAKER_05]: Thanks for the call.

[SPEAKER_05]: No, we got time.

[SPEAKER_05]: So let's play another question.

[SPEAKER_03]: This is Jake from Northern California.

[SPEAKER_03]: I was calling to get you guys a thought on the global X copper miners ETF CO PX.

[SPEAKER_03]: I'm looking to add this to my four or three B for a long-term hold.

[SPEAKER_03]: So if you could just let me know what you think.

[SPEAKER_03]: And if you have time, you could also let me know what your results are on the silver miners ETF.

[SPEAKER_03]: This would be adding to my fourth or V again right now.

[SPEAKER_03]: My precious metal exposure is about five percent.

[SPEAKER_03]: And that's mainly to GDX.

[SPEAKER_03]: Thank you.

[SPEAKER_03]: Bye.

[SPEAKER_05]: All right, looking at COPX and silver miners.

[SPEAKER_05]: I'll start with COPX.

[SPEAKER_05]: COPX is the global X copper miners ETF, but a sixty-five basis point expense ratio.

[SPEAKER_05]: It's a little high from my blood, but, you know, if you just want broad exposure to copper miners, this would be a good fund for that top holding is London mining out of Canada, then first quantum minerals, also out of Canada, Ango,

[SPEAKER_05]: And so the gasta, kind of the UK, then you have a Chinese minor, then you have freeport macron, that is number five on this list.

[SPEAKER_05]: Yeah, out of the United States, then you have, so even you have some Japanese one, one coming out of Poland, another out of Australia, and so you can see you get good broad geographic diversification.

[SPEAKER_05]: Here you have forty different names with no one name taking up more than about five and a percent of the portfolio.

[SPEAKER_05]: So I like that and I think this is a good way to gain exposure if you don't want to.

[SPEAKER_05]: tie your horse to tie your luck to one horse.

[SPEAKER_05]: I would go with this and get that broad-based diversification.

[SPEAKER_05]: When it comes to silver miners, if you have five percent of your portfolio in GDX, I think this is a good compliment, and maybe an SIL, for example, would be a good way to gain exposure there, probably no more than two, three percent of the portfolio.

[SPEAKER_05]: I would always want a little more gold than silver.

[SPEAKER_05]: but I think this is a good time to be adding to silver miners as well.

[SPEAKER_05]: So I like the way you are thinking with both of these names.

[SPEAKER_05]: Those are Vestock.

[SPEAKER_05]: I'm Justin Klein.

[SPEAKER_05]: We have one goal here each and every week.

[SPEAKER_05]: They help you achieve your own version of financial freedom.

[SPEAKER_05]: And then we're continues after this final break.

[SPEAKER_05]: Which questions in?

[SPEAKER_05]: Right now in eight and eight and ninety nine chart.

[SPEAKER_05]: Don't forget to cruise over to the new Vestock store.

[SPEAKER_05]: It's open now at the Vestock store back home.

[SPEAKER_07]: Every investor is working to build a secure financial future.

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[SPEAKER_07]: Invest talk, eight, eight, nine, chart.

[SPEAKER_05]: Bill's lastly talk about a recent trend here in America, and that is the fact that our economy is increasingly becoming more and more like China.

[SPEAKER_05]: And this is an interesting twist.

[SPEAKER_05]: And you're seeing this in mainly the biggest recent news is the fifteen percent of certain chip sales from Nvidia and AMD that it will pay while the golden share to Washington.

[SPEAKER_05]: Okay.

[SPEAKER_05]: This is starting to feel and look a lot like what is happening over and in China and many other countries as well.

[SPEAKER_05]: It isn't socialism, but it's really state run capitalized capitalism.

[SPEAKER_05]: That's a hybrid between socialism and capitalism.

[SPEAKER_05]: Where the state guides the decisions of private enterprises.

[SPEAKER_05]: Now, the US hasn't gotten as far as China, obviously.

[SPEAKER_05]: But it's a more milder version similar to what happens in Russia, Brazil, and France.

[SPEAKER_05]: And there are variants to state capitalism.

[SPEAKER_05]: But it's definitely a sea change from the free market ethos that we've seen embodied here in the United States for a long time.

[SPEAKER_05]: Now, to be fair, throughout history, we've waited into what happens in the corporate world many times, but usually it's during difficult periods.

[SPEAKER_05]: For example, we have the Defense Production Act, or in World War II, that forced companies like GM to start making planes and tanks and military vehicles, et cetera.

[SPEAKER_05]: Then we have the bailouts of the banks and the car companies, and of seven and through a night.

[SPEAKER_05]: And more recently, we've had the inflation reduction act, is a type of industrial policy.

[SPEAKER_05]: It's more carrots than sticks, right?

[SPEAKER_05]: There's different ways to try to get corporations within your borders to do what you want them to do.

[SPEAKER_05]: What President Biden did was more carrots, right?

[SPEAKER_05]: Here are subsidies, here are low interest loans, et cetera, whereas what President Trump is doing is more and more sticks, right?

[SPEAKER_05]: If you don't do this, then you can't do that.

[SPEAKER_05]: Now, Trump's defense department also is starting to take a stake in critical minerals, so they took a fifteen percent stake in MP materials, for example, so that's what you've seen that go up as of late.

[SPEAKER_05]: So it's starting to put government money into private enterprises and invest with them.

[SPEAKER_05]: Now, some of the people might like this, some people might say, hey, for China, it's turbocharged their growth.

[SPEAKER_05]: It's allowed them to not get caught up with checks and balances and compromise.

[SPEAKER_05]: They just get things done.

[SPEAKER_05]: And to President Trump's admirers, they like that.

[SPEAKER_05]: They get over all of these stupid obstacles in their mind and it allows them to finalize deals.

[SPEAKER_05]: You think about the

[SPEAKER_05]: quote unquote trade deals that were agreed to with Japan, European Union South Korea, and about a money that's expected to be invested here, even though there's really no legal mechanism for them to force them to do that.

[SPEAKER_05]: But it's clear that this is something that is once again, it's his mentality is the stick, not the carry.

[SPEAKER_05]: Okay.

[SPEAKER_05]: Now, what is the problem with state capitalism throughout history?

[SPEAKER_05]: And I think there's a reason why it hasn't caught on more broadly.

[SPEAKER_05]: because the state can't allocate capital like private markets can't.

[SPEAKER_05]: Inevitably, and you see this with crunches like Russia, Brazil, France, they've grown slower than here in the United States, because of the distortions, the waste, the cronies, and that comes with state-run capitalism.

[SPEAKER_05]: And the same thing in China.

[SPEAKER_05]: Well, China has done a lot, which you don't realize is there's a lot of misallocation of capital there.

[SPEAKER_05]: And so underneath the surface of the ton of debt and China even worse than we have, there are a lot of its localized and state and local governments there.

[SPEAKER_05]: But obviously, this is a sea change and unless we pull back from this, I'm afraid we're going to see much lower growth from the broader economy because historically state-run capitalism doesn't turn out very well.

[SPEAKER_05]: Without my dozen,

[SPEAKER_05]: I'm Justin Klein of today's show, made you think about your broader financial picture.

[SPEAKER_05]: What's happening in the world and how that applies to your strategy and your longer-term goals.

[SPEAKER_05]: I encourage you to hover to besttalk.com and click on the portfolio view button and schedule a free portfolio view with myself or Luke and Huping Clarity to your strategy and confidence to your path.

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[SPEAKER_05]: Good night.

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