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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.