Benzinga's Premarket Prep is the #1 go-to source for everything you need to know before the market opens! Join our expert hosts as they break down the latest market trends, analyze key indicators, and provide actionable insights to help you navigate the trading day ahead.
Category
🗞
NewsTranscript
00:00But again, I'll go through it a little quicker.
00:01People can obviously watch the replay on YouTube,
00:03hit pause on some of these slides,
00:04if you were to really dig in.
00:05But this is a deck I've been using for the past month or so
00:09to talk about kind of where we see things.
00:10So managing your wealth and sanity,
00:12I added that part, and sanity in an election year.
00:15First things first, Monday,
00:16and don't invest in just one day.
00:18Monday is my birthday.
00:19It's also historically the best day of the year.
00:22October 28th is the best day of the year.
00:24Coincidence or not, I don't know, but it's a fun one.
00:27But I will say, just look at early November, okay?
00:30Late October, early November,
00:31historically is like one of the best two-week periods.
00:33Now you can throw that all out the window,
00:34because listen, this year's just blowing up
00:36a lot of these things.
00:37But just kind of be aware that, you know, hey,
00:39we are still a pretty strong timeframe
00:42as we get into next week, right ahead of the election,
00:44which is interesting, but just something to be aware of.
00:46Dennis, how does the stock perform on your birthday?
00:51Well, look, what birthday do you guys have?
00:53Want to look at that real quick?
00:54Well, I figured Dennis looked at his,
00:55because that was the first thing I did,
00:57was I looked for mine.
00:57It looks like down 0.05%.
01:01Wait, what's it do on your birthday, Ryan, again?
01:03I'm 0.51, the one that's kind of circled there, October 28th.
01:07So you're like the best one.
01:09No, that's what he said.
01:10Are you the best one?
01:11Is that what you said?
01:11Yeah.
01:12Yeah, my birthday's the best day.
01:14That's unbelievable.
01:15You are always destined for this industry, Ryan.
01:18Yeah.
01:19To be born.
01:20I literally have a crash on Monday.
01:20Destined right for birth.
01:21Who's born on October 19th?
01:23Yeah, October 19th.
01:25That's the bad one.
01:26Mine is 0.52%.
01:28That's its average return.
01:29Mine is 0.52%.
01:31Well, you throw a negative 20 in there.
01:33You know, it kind of skews that.
01:34Oh, yeah, it kind of screws you up a little bit, I guess.
01:37That's why it's-
01:37You know what?
01:38October 28th in 2008 had a huge day with all that volatility,
01:42but I don't know off the top of my head.
01:43But anyway, kind of a fun one.
01:44Where's your birthday?
01:45You know, how do you do?
01:47Mine's Monday, and historically it's pretty darn-
01:49Happy birthday, Ryan.
01:52Thank you, guys.
01:53So big picture.
01:54I shared this before.
01:55I'll share it again.
01:56I share it every time I present.
01:57Lots of bad things have happened historically.
01:58Stocks do tend to go higher.
02:00Believe me, sometimes it takes a while
02:01to get back to new highs.
02:02I'm not a short-term trader.
02:04I'm an investment guy.
02:04I'm an investment strategist, a chief market strategist.
02:07Do look a little bit longer term here
02:08when I manage clients' money,
02:10but we just like to point out, hey,
02:11things do tend to trend higher over time.
02:14Now, Will Rogers said,
02:15"'I don't make jokes.
02:16"'I watch the government and report the facts.'"
02:19That's a good one.
02:20That is pretty good.
02:21Well, there's a lot you can look at here
02:23that we made this start of the year.
02:24If Biden were to win, if Trump were to win,
02:26well, obviously we played a little fun
02:27and scratched off Biden, put in Harris.
02:29It is about taxes, right?
02:30That one on the bottom, or no,
02:32this is not the one with taxes on the bottom,
02:33but, okay, taxes on the top on this one, sorry.
02:36Corporate tax rate, 21% right now.
02:39Yes, if Vice President Harris were to win,
02:41that's probably gonna go higher.
02:43If Trump wins, it stays there.
02:44He says he wants to cut it.
02:45We're not so sure.
02:46He's gonna have enough power in the Senate
02:47and House to do that.
02:48That's the big one.
02:49We think tariffs, obviously nothing people don't know.
02:52Tariffs will probably go higher.
02:53Obviously if President Trump were to win
02:55versus Vice President Harris,
02:56although those tariffs are probably still gonna stay
02:58for the most part.
02:59So there's some big picture things.
03:00I don't like to get too much into the F word, fundamentals,
03:03but these are all the things you can think about.
03:05Here's a really cool chart.
03:06I'll just take your phone, take a picture of it.
03:08Libby Cantrell, who actually is on our podcast
03:10in I think next week, next week, from PIMCO.
03:13She's one of the best political strategists
03:14there are, period, out there in my opinion.
03:16This is PIMCO of all the different things
03:18were to happen, of who were to win and things like that.
03:20I don't wanna get into it again.
03:21I know more traders listen to this show,
03:23but it's kind of a neat thing to think about.
03:24And again, it is about the taxes and tax rates.
03:26So it isn't so easy.
03:29I go to AI, I say, hey, give me a picture
03:31of the last three presidents drinking a beer
03:32and being friendly with each other.
03:33So it is possible.
03:34Oh, that's awesome.
03:35Maybe they can't make everybody friendly,
03:37but it isn't so easy with what we're seeing out there.
03:40Oh, what'd I skip one?
03:41What we're seeing out there.
03:43If voting made any difference though,
03:44they wouldn't let us do it.
03:45That's what Mark Twain told us.
03:47I think that's something to think about.
03:49But not just to me, but to the bull market, right?
03:51We just hit a two-year, some people call it anniversary.
03:54I like to say birthday, because they're more fun.
03:57Of the October 12th of a couple of years ago,
03:59what really stood out to me, and it's been out there,
04:01because I've shared it with other people.
04:02When you get to two years,
04:04you can see the last 50 years, right?
04:06Check it out there.
04:06The last five times a bull market made it
04:09to its second birthday or into the third year,
04:12is maybe how we're gonna put that,
04:13went an average of eight years.
04:15The worst it went was five years.
04:18So yes, a bull market, I'm using the definition of it,
04:20a 20% decline.
04:21So I get it, sometimes we're close,
04:22sometimes not, just big picture stuff.
04:25My friend, Sam Stovall, huge fan of him,
04:27hung out with him like a week ago.
04:28Sam said this, he said, once you get to 65,
04:30the odds of getting to 85 are really good for us as humans.
04:36Bull markets aren't all that different, okay?
04:38Once they get to a certain level, so listen,
04:40year three might not be that great,
04:42because historically year three can be a little more choppy
04:44and this and that, but again,
04:46with the economy so strong, like we think it is,
04:48just be aware for the longer term investors out there,
04:52these bull markets can last a lot longer
04:54than you think once you get here.
04:56I've shared these with you literally
04:58every time I call you, all year.
04:59The last 10 times we got a president up for re-election
05:02and I get it, asterisks,
05:03because now we don't have a president up for re-election.
05:05Well, kind of, I guess with Trump,
05:06but you know what I'm getting at,
05:07we came into the year with a president up for re-election,
05:09the stock market's higher last 10 times.
05:10We knew that coming into this year, what is it?
05:1212.2%, yeah, 12.2%.
05:14I mean, it is what it is,
05:15you don't blindly invest just because of this,
05:17but it didn't hurt, right?
05:18To be overweight equities
05:19when you saw 400 basis point out performance
05:22when you have a president up for re-election
05:23and never lower.
05:24So that's something to think about.
05:25This one's wild.
05:26When you're down in the midterm year,
05:27like we were in 22, a horrible year for investors,
05:30bond market did terrible, gold did okay, I guess,
05:33and stocks did terrible.
05:35Obviously it'd be in like energy in 22
05:36or you didn't have a good year.
05:38Check it out, pre-election years and election years
05:40have been higher the last 19 times.
05:42The last 19 times, pre-election years and election years
05:45are higher after a negative midterm year.
05:48We were talking about this in our shop
05:49for almost two years now, we've been pointing this out
05:50and sure enough, this year,
05:52unless we have some really bad stuff happen,
05:53we're gonna be higher this year on the S&P,
05:55which makes it 20 years in a row.
05:57You had a negative midterm year
05:59and the next two years were higher.
06:00I mean, that is mind boggling,
06:02but again, like I said, it is what it is.
06:04Maybe this bull market keeps going for another year.
06:05I wouldn't be shocked if it is
06:06and maybe we have a negative midterm year.
06:08I'll come on with you guys in a couple of years,
06:09say, listen, maybe we'll get a negative midterm year,
06:11but don't be so upset during it
06:13because hey, look what happens after.
06:15When you have a big year, when you're up 20%,
06:18like we were last year,
06:20what tends to happen that next election year?
06:22Never lower and we're able to return.
06:24So 11% on average, okay?
06:25So again, these are things we've talked about all year,
06:27why this year could be better than people think,
06:29why this year could be a strong election year.
06:31It's literally like the strongest election year
06:33for the S&P 500 up to this point we've ever seen.
06:36You know, that's even better than we thought.
06:37We've been over with equities bullish.
06:38Believe me, I didn't think we'd be up 23 or 22%
06:40as we sit here on my birthday,
06:42I guess we could say on Monday, but it is happening.
06:45So the stuff everybody knows, year three is the best,
06:48year four of an election year,
06:49this is all looking at all the election year.
06:51So, you know, sitting president, lame duck president,
06:53all that stuff, 7.3% on average,
06:55but higher about five out of six years on average,
06:57about 83% of the time.
06:59That's because like 2000, 2008, weren't very good, okay?
07:02You had some big outliers in election years,
07:05but most of the other election years,
07:06especially if you avoid a recession
07:08like we thought we would all year,
07:09tend to be really, really strong
07:11because you're most usually higher.
07:12So again, it shouldn't be surprising where we are,
07:15but the best argument against a democracy
07:16is a five-minute conversation with the average voter,
07:19that's Winston Churchill there.
07:21And this is interesting,
07:23I actually tweeted this a little bit ago
07:24because I looked at this deck and thought that was cool.
07:26You tend to bottom an election year around now,
07:28now let's be very clear,
07:29you also tend to see some weakness, right?
07:31September, October of an election year
07:33usually aren't very strong,
07:35clearly we're kind of bucking that trend,
07:37who knows, maybe October still could finish lower.
07:38We got a six-week win streak,
07:40probably going to end right now.
07:42Historically, you tend to see outperformance
07:44after six-week win streaks.
07:45But anyway, just be aware,
07:47maybe the next week or two,
07:48get a little volatility, a little sell-off,
07:49perfectly normal,
07:51although then again, I did share earlier
07:52where these next upcoming days are pretty bullish,
07:54but I wouldn't be surprised
07:55if we did see some election volatility,
07:57I just want to be clear there,
07:58but to be open to that end-of-year rally.
08:00So this just puts in context,
08:02this might be a tad old, yeah, October 5th,
08:03but puts in context just how strong
08:05this election year is, right?
08:07We've hit, this is fun,
08:09we've hit a new high in every month
08:10except for the ones that start with A.
08:12April and August, I don't know.
08:14Last I checked, no more months end in A,
08:16so maybe that's a good thing for everybody.
08:18But anyway, we've hit 47 new all-time highs,
08:20or 48, 47 or 48, I shouldn't know that,
08:21but we've hit a lot of new all-time highs,
08:23believe me, we think there are some more still coming
08:26once we get past the election.
08:28Fourth quarter is the best quarter of the year on average,
08:32what is up about 80% of the time.
08:34But check it out, when you're higher
08:35in eight of the first nine months,
08:36like we were this year,
08:38and only April has seen stocks down,
08:40even August with no new highs,
08:41still gained after that rough start
08:43because of the in-carry trade.
08:45The average returns over 6% in the fourth quarter
08:48when you're up eight of the first nine.
08:51So just, hey, it is what it is,
08:52one of those things I wouldn't wanna ignore.
08:54Momentum's real, we're up five months in a row, okay,
08:58but we're also up 10 of 11 months on the S&P 500.
09:00I just took a look, 10 of 11, pretty small sample size.
09:02Hey, if there were more, I'd share more.
09:04You can see there, six months later,
09:05a year later, a year later,
09:0615% on average after higher 10 of 11
09:09and higher nine out of 10 times.
09:10I don't know.
09:12Yeah, you stack these things on top of each other,
09:14and after a while, you start seeing
09:15why we've been bullish for two years.
09:16I've been pointing stuff out like this for a long time now.
09:19Does little to change.
09:20We are also, well, this is a good one.
09:21George Washington, only president,
09:23didn't blame the previous administration, source unknown.
09:25I will say, if you guys give me five more minutes,
09:27I can wrap this up.
09:29We're up five months in a row also on the S&P,
09:31and I don't think I added it.
09:33If it's coming up, hey, I'll give it now.
09:34One year later, S&P higher 28 out of 29 times
09:39after a five-month win streak.
09:41Hey, we might be down in October.
09:42We might be down in November.
09:43We're gonna be down one of these months eventually.
09:44It's just gonna happen,
09:45but five-month win streaks tend to kick off
09:48the periods of outperformance and market strength,
09:51and I know that sounds wild
09:51because we've been pretty darn strong for two years.
09:53I get it, but still, just wouldn't call that bearish.
09:57Who does better for stocks?
09:58This is where people start getting mad at me.
09:59If you don't like the first answer,
10:01just wait for the second answer.
10:01I'm gonna try to offend everybody here.
10:03Yes, stocks historically have done better
10:05under Democratic presidents.
10:07We've got more Democratic presidents.
10:08Republicans have the short straw
10:09by having 2000 and 2008, the tech bubble,
10:13and the GFC, small sample size,
10:16but still, stocks have done better when you have a Republican,
10:18I'm sorry, when a Democrat is in office.
10:21The flip side of this,
10:22when you have Republicans have both chambers of Congress,
10:26stocks do a good deal better.
10:27It's what you can see here.
10:2811% average versus the Democrats
10:29in both chambers of Congress.
10:30You could argue you get more down
10:31when you have both chambers of Congress
10:32versus in the White House.
10:34I don't know, but the bottom line is split Congress.
10:36That's the one I've come on with all year
10:37talking about this.
10:38When you have a split Congress division,
10:41checks and balances, 13 years in a row,
10:44we knew this coming into this year, by the way,
10:4613 years in a row, stocks are higher under split Congress.
10:48We came into this year
10:49with one of the splittest of all split Congress,
10:51four seat majority in the House,
10:52smallest in 140 years, 51-49 in the Senate for Democrats.
10:56Anything that was gonna get through
10:57was gonna take both sides to work together,
10:58kind of the way you want things to happen in the world,
11:01and you have a strong market.
11:02Look at where we are, right?
11:04This is gonna be the 14th year in a row
11:05with a split Congress, and here's the spoiler alert.
11:07We think we're still gonna have a split Congress
11:08on the other side of this election.
11:09We think it's gonna flip-flop.
11:10A lot of smart people are saying that,
11:12people like Libby Cantrell that I get to work with
11:14over at PIMCO, she's thinking we've had flip-flop.
11:16Democrats probably take the, let's see if I can say this
11:18right, Democrats take the House,
11:20Republicans take the Senate, just by a little bit,
11:22so we're still gonna have that division.
11:23Split Congress maybe is what our most investors
11:26should root for when they wake up.
11:27My buddy Sam said, as the old saying goes,
11:29if the opposite of pro is con,
11:32the opposite of progress must be Congress.
11:35That's a good one for this time of year.
11:37Wow.
11:38Yeah, a couple more, a couple more.
11:39You know, I used all the information
11:41at the stand-up comedy show too.
11:42This is, yeah, you know, this stuff's boring,
11:45so I gotta make it fun, you know.
11:46Anyway, so there's all the breakdowns.
11:48I'm not gonna spend a ton of time on it.
11:49You see this stuff all over the place,
11:50but just different scenarios, what might happen,
11:52what could happen with different things.
11:55Alfonso Carr, I'm almost done, I swear.
11:57The more things change, the more they are the same.
12:00Famous old quote, what's gonna stay the same
12:02no matter who wins?
12:03That's the stuff we're trying to focus on.
12:04No matter who wins, what's gonna stay the same?
12:06Defense spending.
12:07I look around the world, defense spending
12:09as a percentage of GDP this time,
12:10a year and a half ago was the lowest
12:12it's been since the early 80s.
12:13Neil Dutt over at Red Mac, we had him on our show before.
12:16He was talking about, listen, this is gonna go higher,
12:18and it made a lot of sense.
12:19So I don't care who's in the White House.
12:20Well, I care, but it doesn't matter who's in the White House.
12:22I think that we're gonna see defense spending
12:24continue to go higher, and that could be good
12:25for industrials.
12:26Defense is a big part of industrials,
12:27building and creating things.
12:29Hey, that's not the end of the world.
12:30I mean, to spend on defense,
12:31it's not something you're warm and fuzzy about,
12:33but you're out there creating.
12:34We're probably still gonna be the largest oil producer.
12:36We make over, we produce 13 billion,
12:38oh, 13 billion, that's a lot.
12:3913 million barrels, I'm confusing my M's and B's,
12:4213 million barrels of oil a day.
12:45I don't think that's really gonna change
12:46necessarily who's in the White House either.
12:48You can say, oh, you know, Vice President Harris
12:50might do this or that.
12:51Well, under President Biden, we're pumping more oil
12:53than we were under President Trump.
12:55It started under President Trump,
12:56but so just kind of that's something else
12:57we think won't change.
12:59The third one that won't change, U.S. dollar,
13:01as long as anyone's alive, listen to this podcast,
13:03that's not a podcast, listen to this live stream,
13:05we will probably have the world's reserve currency.
13:07Okay, that's just what we think.
13:08We have the cleanest shirt and dirty laundry,
13:10March of 2020, what happened?
13:11Gold down, stocks down, bonds down.
13:14Look it up, everything was getting hit.
13:15You know, stronger March of 2020,
13:17the cleanest shirt and a dirty laundry, the U.S. dollar.
13:20The first 10 months of 22 when gold,
13:22when stocks and bonds are like
13:25their worst first 10 months ever.
13:26I mean, 22 is horrible for investors
13:28because bonds gave us nothing.
13:29I know we remember that,
13:30but it's sometimes good to go back and look at that.
13:32The dollar had a strongest 10 month rally ever back then.
13:35So what I'm getting at in times of stress
13:37and times of fear when the you know what hits the fan,
13:39people flock to the dollar until that changes.
13:41And I don't think it's going to change anytime soon.
13:43Again, as long as anyone's alive, listen to this.
13:44We do have the world's reserve currency,
13:46so that's on the other side.
13:47George Carlin, as you imagine him,
13:48they would cancel him in a heartbeat,
13:50but I think we could use him today.
13:51Bipartisan usually means larger than usual deception
13:56is being carried out.
13:57George Carlin there.
13:58That's more stuff on the dollar.
13:59I'm not going to spend any more time on it.
14:01I end with this one.
14:02Groucho Marx, politics is the art of looking for trouble,
14:05finding it everywhere, diagnosing it incorrectly,
14:08and applying the wrong remedies.
14:10There you go.
14:11There's some disclosures.
14:12So all right, guys, I'm going to take a breath.
14:14I don't know.
14:15So usually again, I do that in like an hour.
14:17I said, I'll just rip this out and go through it fast.
14:20I know I went a lot.
14:21I don't have any time left.
14:22We can talk football or bangles
14:23or Ohio State, Michigan, whatever.
14:26I'm going to take a breath.
14:27I'm going to take a breath.
14:28I'm going to take a breath.
14:29I'm going to take a breath.
14:29I'm going to take a breath.
14:30I'm going to take a breath.
14:31I'm going to take a breath.
14:32I'm going to take a breath.
14:33I'm going to take a breath.
14:34I'm going to take a breath.
14:34I'm going to take a breath.
14:35I'm going to take a breath.
14:36I'm going to take a breath.
14:37I'm going to take a breath.
14:38I'm going to take a breath.
14:39I'm going to take a breath.
14:39I'm going to take a breath.
14:40I'm going to take a breath.
14:41I'm going to take a breath.
14:42I'm going to take a breath.
14:43I'm going to take a breath.
14:44I'm going to take a breath.