[SPEAKER_00]: On radio, on YouTube, streaming live on investtalk.com and for our podcast subscribers, this is invest talk, independent thinking, shared success.
[SPEAKER_00]: Invest talk is made possible by KPP Financial, a registered investment advisor firm, serving clients throughout the United States.
[SPEAKER_00]: Here is KPP Financial Chief Executive Officer, Financial Advisor, Justin Klein.
[SPEAKER_01]: Good afternoon fellow investors and welcome back to invest talk this is our Thursday September 18, 2025 addition, and we only have about eight more trading days left in the quarter.
[SPEAKER_01]: So the fourth quarter is creeping up fast and then we'll be into 2026 which promises to be another year full of challenges and volatility both
[SPEAKER_01]: economically as well as geopolitically and that always feeds back into market.
[SPEAKER_01]: So we're here to give you, you know, unbiased view of how that is likely to impact your investments, your strategy, and
[SPEAKER_01]: We do this by answering your finance and investment questions and giving you data and perspective developed over 25 years of investment experience.
[SPEAKER_01]: So this hour, what's going to is dedicated to you and your endeavor to reach financial freedom.
[SPEAKER_01]: Now, just a bit, we'll talk about today's market activity and performance and run down the show topics, but as usual, we'll tackle this first-color question now.
[SPEAKER_02]: Hello, my name is Margarito.
[SPEAKER_02]: If they could tell me their feelings on rocket lab, RKLB, I'm thinking of getting a position in it, and I just wonder what their thoughts were.
[SPEAKER_02]: Look forward to hearing from y'all, and keep up the great work.
[SPEAKER_02]: Thanks a lot, bye.
[SPEAKER_01]: We get rocket lab that develop rocket launch and control systems for space and defense industry.
[SPEAKER_01]: We are going to spend more on rocket technology, space exploration, and we have the new space defense team, the department as well.
[SPEAKER_01]: So that is the idea, it's headquartered here in Southern California, Long Beach, California.
[SPEAKER_01]: But the problem is, is it just doesn't make any money, loses money, it's, track what he is negative, and it just continues to issue more and more shares.
[SPEAKER_01]: So to me, this is just a whole lot of hype.
[SPEAKER_01]: Sure, could they be fall through with the,
[SPEAKER_01]: spending in regards to space from the government.
[SPEAKER_01]: Yeah, but I don't see much from the civilian market, as well as we have satellites, satellite launches, so that from a commercial standpoint is good.
[SPEAKER_01]: But we have other companies that do that more efficiently and more effectively.
[SPEAKER_01]: So to me, this is a whole lot of hype and hype works when liquidity is abundant, but if you go back and look at the previous returns when liquidity suddenly wasn't so abundant like in 2022, this went from a high of around $14 to a low of $3 in change.
[SPEAKER_01]: And so it's rallied considerably, now worth $22, almost $23 billion from a market
[SPEAKER_01]: The good news is they don't have any debt, but they also don't have any cash flow or profits either.
[SPEAKER_01]: So I would absolutely pass on this.
[SPEAKER_01]: Actually, I think it's a pretty good short at these levels.
[SPEAKER_01]: Now, is it going to turn around and go down tomorrow?
[SPEAKER_01]: Maybe not.
[SPEAKER_01]: But it's certainly looking
[SPEAKER_01]: And, you know, it could have another lag higher.
[SPEAKER_01]: But ultimately, when liquidity EBS, which we'll probably between now and sometime at the end of next year, this is a name that we'll probably go down considerably.
[SPEAKER_01]: So I find this to be a pretty good short and I absolutely would not be buying rocket labs, RK, L, B,
[SPEAKER_01]: Now, a lot of cover, over the next 45 minutes or so, and our main focus point is about your 401k, and are you doing everything, or is it doing everything it could be?
[SPEAKER_01]: And there is some new legislation or directives, shall we say, from the White House in regards to 401k investments and private investments.
[SPEAKER_01]: Let's talk about why the returns that you might get from private investments,
[SPEAKER_01]: is not going to make up for the lack of the saving side of your 401k or your investment strategy or your retirement strategy.
[SPEAKER_01]: So we're going to look at some numbers and explain why savings is far more important than it was incremental return profile that a private investment might give you.
[SPEAKER_01]: So look at that.
[SPEAKER_01]: Also, what's goal telling us?
[SPEAKER_01]: What is goal
[SPEAKER_01]: You know, a lot of times you have to listen to the market, the market more often than not tells a more correct story than you're going to get anywhere.
[SPEAKER_01]: Whether that's traditional media, social media, alternative media, whatever media you want to talk about, the market is in and itself a story teller and
[SPEAKER_01]: You can have a pretty good sense of not only what is happening in the broader world economically, geopolitically, etc.
[SPEAKER_01]: But also what is likely to happen because there's the market's handy capping the future as well.
[SPEAKER_01]: So we'll look at that story.
[SPEAKER_01]: In addition,
[SPEAKER_01]: We'll look at the middle class and the fact that you're starting to see used to be called the last couple of years it's been a lower class, lower income consumers that were feeling the strain but you're starting to get more and more data points that the middle class is starting to feel the strain as well.
[SPEAKER_01]: So we'll look at some of that and lastly if we have time
[SPEAKER_01]: How Central Bank monetary policy is evolving and is it in a good way or a bad way?
[SPEAKER_01]: So we'll look at that story.
[SPEAKER_01]: We also have voice bank calls to answer one is on fixed income as well as Navitas semiconductor corporation and BTS.
[SPEAKER_01]: We also have questions that came in via the comment section over on the YouTube channel as well.
[SPEAKER_01]: Now, we're going to head into a quick break.
[SPEAKER_01]: Please remember you can call any time.
[SPEAKER_01]: Leave your questions on the Invest talk, voice bank, and if you're listening via our live stream or on AM-1220 in the Bay Area, you can call right now live at 8.99 chart.
[SPEAKER_01]: But up next, I will comment on today's market activity.
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[SPEAKER_01]: Let's go take a look at the market today.
[SPEAKER_01]: It was overall a positive day for equities.
[SPEAKER_01]: And it was really on the small capsized.
[SPEAKER_01]: Small caps were up well over one percent.
[SPEAKER_01]: Small cap growth is up over 2%.
[SPEAKER_01]: And the S&P,
[SPEAKER_01]: itself up about half a percent, NASDAQ up just shy of 1% and the dial was up about a quarter percent on the day.
[SPEAKER_01]: You had some big movers like Intel Intel was up and that really drove out of the semi-connection index that was up about 23% and that was in the back of their partnership with.
[SPEAKER_01]: in video.
[SPEAKER_01]: So you saw some strength there that really had a large impact on markets overall.
[SPEAKER_01]: What else do we have?
[SPEAKER_01]: You had some other names like plug power that did very well about 5% and
[SPEAKER_01]: Ultimately, it is a continuation from the Fed rate cut yesterday, but still kind of dominating the new cycle overall, because when the Fed embarks on an easing cycle that does tend to spark more credit creation from the banks with the yield curve steepening, and that's likely what we will see over the next six to nine months or so that should extend this current growth
[SPEAKER_01]: cycle.
[SPEAKER_01]: Now, there are still headwinds, tariffs are one of those, but it's clearly not enough quite yet to derail the growth cycle.
[SPEAKER_01]: And we did get a stronger dollar as a result of the Fed rate cut, which is interesting, but it's not unexplainable.
[SPEAKER_01]: In fact,
[SPEAKER_01]: I'm starting to view that ray cuts are actually in the medium term, not great for the broader liquidity dynamics.
[SPEAKER_01]: Because what happens is, because we have so much debt.
[SPEAKER_01]: There is, when the Fed cuts rates, that's lower interest payments coming from the federal government, that's less income to your average person who owns treasuries, who owns maybe CDs, money market accounts, et cetera.
[SPEAKER_01]: These are now yielding accounts, yielding assets when they hadn't been for over a decade.
[SPEAKER_01]: And history shows a strong correlation to inflation,
[SPEAKER_01]: and interest rates.
[SPEAKER_01]: And so, I think because the rates come down, paradoxically, it actually will not be as good for the economy.
[SPEAKER_01]: Kind of in the medium term, like I said.
[SPEAKER_01]: So that's why I think nine to 12 months out, things will probably rate cut will actually
[SPEAKER_01]: be less stimulative than in the short term.
[SPEAKER_01]: I think the short term in this stimulative, there are people are going out the risk curve, investors are going out the risk curve because of the easing cycle.
[SPEAKER_01]: But ultimately, it's about the amount of dollars flowing into the broader economy and the asset markets.
[SPEAKER_01]: And this over time will actually erode that.
[SPEAKER_01]: you have to look at these in different timeframes.
[SPEAKER_01]: Certain actions can be bullish or bear short-term and vice versa.
[SPEAKER_01]: And so you have to look at in kind of this new era of fiscal dominance of so much debt that are on the balance sheets of
[SPEAKER_01]: Corporations of individuals and it's on the sovereign level, right?
[SPEAKER_01]: And so that is something that I continue to believe we are okay for now, but a rate cutting cycle is actually not that's demulative in the medium to long term because of that income component that actually lowers overall for the broader economy.
[SPEAKER_01]: So that's where we're at, but so far, so good for markets.
[SPEAKER_01]: Now, let's go with another YouTube.
[SPEAKER_01]: Question, and Randy 23 says would love to hear your thoughts on microcaps stock.
[SPEAKER_01]: A Merego resources, ARR, EF, ARR, EF is the symbol.
[SPEAKER_01]: Kind of love these microcaps.
[SPEAKER_01]: And a Merego old resources is in the production of copper and a Lebdenum.
[SPEAKER_01]: I always hate saying that.
[SPEAKER_01]: I don't even know if I'm saying it, right?
[SPEAKER_01]: revenue.
[SPEAKER_01]: I don't have a lot of economic data either.
[SPEAKER_01]: Let me see here.
[SPEAKER_01]: So this is a US company.
[SPEAKER_01]: Let me look at the market cap.
[SPEAKER_01]: It's going to be very small.
[SPEAKER_01]: $274 million.
[SPEAKER_01]: Let me see if I can get some data on geographical revenue.
[SPEAKER_01]: So Chile, it looks like their minds are in Chile.
[SPEAKER_01]: 88% is copper, and the balance is malevolved in them.
[SPEAKER_01]: I hate that name, I hate that word.
[SPEAKER_01]: But it's a copper producer, and copper prices have been trending higher.
[SPEAKER_01]: So that is a positive, and that's why the stock has started to trend higher.
[SPEAKER_01]: And you're getting is a penny stock, it trades for $1.70, but well off its lows.
[SPEAKER_01]: Recently, the April lows, it was right around $1.11, or $2.20.
[SPEAKER_01]: Certainly, I like the 5% dividend yield, that actually does pay dividend.
[SPEAKER_01]: So, I'm going to give this one a thumbs up, a good cash flow, like I said, a good cash flow yield, a good balance sheet, and I like the exposure to copper overall, but understand it's high risk and keep it limited as a percentage of your overall portfolio.
[SPEAKER_01]: Now we're heading into a break still to come, my focus point, and it's your 401k doing everything it could be, or are you doing everything you can to help achieve your long-term retirement goals.
[SPEAKER_01]: And we'll have more answers to your questions after discussing that topic, so I encourage you to call now on the Best Talk 8-899 chart.
[SPEAKER_08]: They invest talk phone lines never close and now Justin Klein is here taking your calls live.
[SPEAKER_08]: Invest talk 88899 chart.
[SPEAKER_01]: Now, our main focus point concerns this question is your 401k doing everything it could be.
[SPEAKER_01]: Well, according to your president Trump, the answer is no, that there is an executive order coming from the White House that directs regulators to create a framework that will allow 401k plans to give access to investors to alternative assets, such as private market investments,
[SPEAKER_01]: overall returns.
[SPEAKER_01]: But this kind of hides the biggest issue that most investors that are behind the curve have.
[SPEAKER_01]: And that is the lack of savings.
[SPEAKER_01]: Okay, return is only one component to the your overall financial picture.
[SPEAKER_01]: And when you run the numbers, the simple, there's a simple
[SPEAKER_01]: far more important than incrementally better returns.
[SPEAKER_01]: And there's a couple of very simple examples of this.
[SPEAKER_01]: And it takes a look at two workers.
[SPEAKER_01]: One who starts at 25 years old, saving.
[SPEAKER_01]: And saves 10% of the salary.
[SPEAKER_01]: gets that company match, usually it's around 3%.
[SPEAKER_01]: So total, about 13% total savings.
[SPEAKER_01]: And then you have a colleague, same salary, same growth in their career salary wise.
[SPEAKER_01]: But the other employee starts at 30, not far after, right?
[SPEAKER_01]: 25, 30 still relatively young.
[SPEAKER_01]: And they app for the minimum contribution rate to get that match.
[SPEAKER_01]: And that's what we always say.
[SPEAKER_01]: You want to at least do that.
[SPEAKER_01]: But that's the bare minimum, and that's what this employee is doing.
[SPEAKER_01]: It's contributing, they're contributing 3%, they're getting a 3% match, so total of 6%.
[SPEAKER_01]: So you're talking about 13% versus 6%.
[SPEAKER_01]: Both collecting that nice company match that everybody needs to get.
[SPEAKER_01]: So we'll call that employee A employee B, on employee A's, once again, 13% employee B, 6%.
[SPEAKER_01]: Let's say employee B invest in private equity in addition to their normal index funds that are available.
[SPEAKER_01]: And let's say it's 15% of their overall allocation, which is fairly hefty.
[SPEAKER_01]: Whereas employee A, they just invest in targeted
[SPEAKER_01]: and let's say they were tired at 65.
[SPEAKER_01]: Well, employee B, back, still consistently saved, still consistently got that employer match.
[SPEAKER_01]: At the end of the 35 years, considering normal raises.
[SPEAKER_01]: would have about $2 million.
[SPEAKER_01]: And their annual return to be 8.9%.
[SPEAKER_01]: Percent compared to employee A who just indexed into anything in the private space earned about 8.4.
[SPEAKER_01]: So it's still good, but about a half of percent worse in return.
[SPEAKER_01]: Well, employee A now has $3 million.
[SPEAKER_01]: versus employee B has two million dollars.
[SPEAKER_01]: So despite a better return that savings difference was dramatic, especially year after year.
[SPEAKER_01]: And the power of compounding, this work better because there was more money in those funds.
[SPEAKER_01]: And so while if you're lucky, private investments may boost returns a little bit.
[SPEAKER_01]: That's in kind of a rosy scenario, especially because a lot of these private investments don't have the decades of return profile that equities and bonds do.
[SPEAKER_01]: So a lot of it is resencibious and best guesstimants of what private investments will do.
[SPEAKER_01]: But if you look at what Morningstar has looked at when they looked at the private equity funds,
[SPEAKER_01]: The odds of the returns are similar or probably slightly worse than public market funds because it's just the form of active management with typically higher fees.
[SPEAKER_01]: So the reality here is that this is probably not a great idea.
[SPEAKER_01]: It could work out fine.
[SPEAKER_01]: But more often than not, it's not going to work very well.
[SPEAKER_01]: And it doesn't solve a problem that 401k is typically half.
[SPEAKER_01]: which is trading too much by high selling low, which oftentimes we talk about this in the show all the time, which is emotions drive decision-making, when
[SPEAKER_01]: the average investor average employees is making those decisions.
[SPEAKER_01]: Now, in the 401k world, most people said it for get it for better or for worse.
[SPEAKER_01]: Now, from a behavioral standpoint, that's good from a asset allocation standpoint, oftentimes that's not because you usually not invested properly in that way.
[SPEAKER_01]: But the bottom line here is that private equity, private investments are not going to save the day.
[SPEAKER_01]: It's about saving early and saving at least 10% in total.
[SPEAKER_01]: Closer to 15 would be ideal and closer to 20 would be amazing.
[SPEAKER_01]: That's 20% of your salary.
[SPEAKER_01]: According to Vanguard, 54% of 401K participants 25 are younger.
[SPEAKER_01]: Contribute to the 401k, so it's not very many, and an 82% between 25 and 34 in tribute.
[SPEAKER_01]: So it's really about getting those numbers higher and making sure that they are at an adequate pace for your retirement goals.
[SPEAKER_01]: Now we're heading into a break.
[SPEAKER_01]: As I think you know, the invest-like voice bank never closes, so give it a call now at eight and a nine chart.
[SPEAKER_08]: Twenty twenty five rolls on and you might have some fresh questions for Justin or Luke.
[SPEAKER_08]: Call in Vestalk eight eight eight nine chart.
[SPEAKER_04]: Hey, Duncan here from New York.
[SPEAKER_04]: Thank you.
[SPEAKER_04]: That all that you do.
[SPEAKER_04]: I got a quick question on six income idea.
[SPEAKER_04]: I am trying to kind of build a small fixed income account.
[SPEAKER_04]: I already have some treasuries in it.
[SPEAKER_04]: And I was thinking about some bonds.
[SPEAKER_04]: as a beginner slash medium like investor what do you guys think of foreign bonds the reason I bring this up is well I actually went to Italy had a great time there and obviously the euro was stronger than the dollar and then I was thinking wait would it be better for me to actually start thinking about currency, fixed income in different currencies.
[SPEAKER_04]: such as like the euro so i just wanted your two cents i have a fidelity brokerage so i think i will probably have access to it uh... that their support line would definitely help me out with this kind of be too advanced for me so looking for any type of help your two cents and uh... help a great day bye i love this question i also look Italy in their many times and the answer your question is it's not too advanced as long as you understand the risks
[SPEAKER_01]: When you're investing in foreign bonds of any kind, you have to understand the currency risk.
[SPEAKER_01]: Now, it can be foreign bonds and nominated in dollars, but there's still foreign currency risk there because ultimately, if their currencies fall because especially if the economy falls off a cliff, their and their ability to repay those,
[SPEAKER_01]: those bonds those dollars becomes more difficult, they could defaults.
[SPEAKER_01]: Okay, so a stronger dollar in that sense would be bad for those type of bonds.
[SPEAKER_01]: But you can buy.
[SPEAKER_01]: Italian bonds nominated in euros and if you're getting paid back in euros, there's also currency risk there where, hey, the euro's a client.
[SPEAKER_01]: Well, when you translate them back to dollars, well, you're going to be worth less.
[SPEAKER_01]: And so there's that foreign currency risk you need to consider.
[SPEAKER_01]: It's not necessarily a bad thing, but it's just another risk factor you
[SPEAKER_01]: I'm gonna wish you buying them.
[SPEAKER_01]: I have no issue with shorting the dollar right now and then the medium time.
[SPEAKER_01]: I think short term, he might see the dollar rally a little bit but overall having four bonds and a little bit of diversity in this environment is not the worst idea.
[SPEAKER_01]: Thanks for the call.
[SPEAKER_01]: Let's keep things moving and play two in a row from 80 to 99 chart.
[SPEAKER_05]: My constant struggle is trying to figure out when do I sell things by, but currently I'm looking at my portfolio of many lot of games and many of my stocks and I kind of just want a general tip on how do you exit plans for maybe percentage gains or a timeline?
[SPEAKER_05]: I know a lot of portfolios like to make 15% a year and so my thought as well if I've made
[SPEAKER_05]: 50% gain on a stock, I just be unloading on this stock and just be happy that I made 50%.
[SPEAKER_05]: It's like you want to keep holding it, but you know that you've already beat the market.
[SPEAKER_05]: Specifically, I want to know about British American tobacco, BTI.
[SPEAKER_05]: I have a 60% gain in it.
[SPEAKER_05]: It seems like it's momentum might be slowing down with the trade of like flooding into safe stocks and so it's curious when I should consider selling BTI.
[SPEAKER_01]: Well, you have to look at your entire portfolio, understand that you're going to have some big winners.
[SPEAKER_01]: You also probably have some losers as well.
[SPEAKER_01]: And it's about the combination of the portfolio and the overall returns.
[SPEAKER_01]: So just because one position might be the overall market or your goal, doesn't mean you automatically sell it.
[SPEAKER_01]: Now, first off what you need to do is, you know, have a price target.
[SPEAKER_01]: What is a reasonable valuation that
[SPEAKER_01]: that you would say, okay, this name now no longer is super attractive, okay, and you need to know what that is before you go and buy it.
[SPEAKER_01]: That's number one.
[SPEAKER_01]: And it reaches that.
[SPEAKER_01]: It doesn't necessarily a time to sell it all, but it's probably a time you want to at least rebalance it, bring it back down to a lower allocation, and then potentially have a trailing
[SPEAKER_01]: For example, BTI, it is non-cyclical.
[SPEAKER_01]: It's a cigarette producer.
[SPEAKER_01]: And if there are some other factors here, it also pays a high dividend, so our interest is falling or rising.
[SPEAKER_01]: They're falling right now, so that's benefiting names like BTI, companies that have data paid dividend, et cetera.
[SPEAKER_01]: So that is
[SPEAKER_01]: the positive for VTI right now, but if the economy re-accelerates, which could in the shorter term, because of that easing cycle, and that this deeper yields curve and more lending, then the money might come out of this and go into more cyclical names.
[SPEAKER_01]: And so you have to think of it from that perspective as well, what is the backdrop in the broader economy and what sectors should be overweight and underweight?
[SPEAKER_01]: And so you always constantly have to be monitoring that and thinking about how much exposure you have to eject.
[SPEAKER_01]: This is what us professionals do.
[SPEAKER_01]: So in order to beat the professionals, this is what you have to do.
[SPEAKER_01]: I know it seems hard and complex, but
[SPEAKER_01]: You know, it's about understanding these concepts, gathering the data and applying them to portfolio effectively, and once again, that's a challenge, but if you are going to buy individual names, it's a challenge that you effectively take on if you want to be the market, which is certainly possible, but it does take more work.
[SPEAKER_01]: It's simple as that.
[SPEAKER_01]: So, you're up a lot on on BTI, I think from evaluation perspective, it is.
[SPEAKER_01]: Now, Fairly Value, it was pretty undervalued when it was in its 30s, now it's in the mid-50s.
[SPEAKER_01]: This is probably a good time to at least trim the name.
[SPEAKER_01]: It's still in a broader uptrend above the 100-day moving average, and that's probably what I would use for the out here.
[SPEAKER_01]: It's pretty much found support at the 100-day moving average consistently throughout this uptrend.
[SPEAKER_01]: And if that breaks from more than a couple of days, then you know that the broader trend may have reversed.
[SPEAKER_01]: So, I would continue to hold it, but this is a good time to
[SPEAKER_01]: Trim it just the bed and you know the issue you have with selling is something that most people have as well So you're not you are not the only one Then let's talk a little bit about gold and gold prices continue to Plotted the upside they've so down a little bit of the past
[SPEAKER_01]: We can have chopped sideways, it was overpot, so it makes sense, and the dollar is getting a bit stronger with past couple of days, so you're getting a consolidation period, but gold being around $3700 an ounce, and being well off the lows from what 2023 when it was well below $2,000 an ounce, it's nearly doubled.
[SPEAKER_01]: Yeah, pretty much doubled since the early, sorry, a late 2022.
[SPEAKER_01]: And the reality here is, as I said at the top of the show, it's telling you something.
[SPEAKER_01]: It's telling a story.
[SPEAKER_01]: So what is it telling us?
[SPEAKER_01]: So there's a good case to be made that the broader story that Gold is saying is that the US fiscal situation is a terrible and the dollar is likely to decline over the medium to long term.
[SPEAKER_01]: that the attack on our institutions, the mainly the federal reserve, that is something that the lack of independence that is creeping on the Fed is also playing into gold's rise that inflation is no longer going to be
[SPEAKER_01]: part of the mandate, right?
[SPEAKER_01]: When you have a government takeover of a body like the Fed that has so much power and immense power, it's going to be used for political ends as opposed to the dual mandate that Congress is giving it.
[SPEAKER_01]: And so that is another aspect that gold
[SPEAKER_01]: Over the medium term, long term, we can the dollar.
[SPEAKER_01]: Because the economy will come less competitive.
[SPEAKER_01]: Now, why is it moving so much lately?
[SPEAKER_01]: Is the question?
[SPEAKER_01]: Those are part of it, but those are kind of issues that have been around for a little while.
[SPEAKER_01]: The first, and obviously one is the dollar's been weaker.
[SPEAKER_01]: The second one is that volatility is starting to rise a bit again.
[SPEAKER_01]: That's not a,
[SPEAKER_01]: It's not dramatic, but it is happening, and there's a correlation now, especially the sheer between the rise and the vix and the rise in gold.
[SPEAKER_01]: And so gold is uniquely set up to benefit from rising volatility in a weaker dollar.
[SPEAKER_01]: Now over the medium to long term, you need consistent buyers of any asset for that asset to go up.
[SPEAKER_01]: And you see that with equities, right?
[SPEAKER_01]: The consistent buyer of equities are 401k investors and Robo advisor investors.
[SPEAKER_01]: And just broader investors in US markets, a lot of them just simply buy the index.
[SPEAKER_01]: So what's happening in gold?
[SPEAKER_01]: And there are basically two groups that, by gold, what are convicted buyers, meaning that not convicted and going to jail or anything, but they have strong conviction that they want to diversify their portfolios, their asset base in something that is not controlled by any government.
[SPEAKER_01]: that can't be confiscated from you like what the U.S.
[SPEAKER_01]: did with Russia during the invasion of Ukraine.
[SPEAKER_01]: And these are buyers that buy ETFs or sorry, there is these are buyers like ETFs, like central banks and broader speculators.
[SPEAKER_01]: And this is more of a macro risk
[SPEAKER_01]: and it's driven by a broader thesis.
[SPEAKER_01]: So price direction is driven by these buyers.
[SPEAKER_01]: You also have opportunistic buyers who buy and dip and they're more traders, but that really just cushions pullbacks.
[SPEAKER_01]: It doesn't drive the broader trend.
[SPEAKER_01]: And according to the world gold cancel, the biggest buyers as of late actually ETF buyers.
[SPEAKER_01]: So there are a lot of individual investors going in and buying gold.
[SPEAKER_01]: That was what drove the goal price in the first half of the year, but now in the second half of the year, and it continues to be those buyers as well as central banks.
[SPEAKER_01]: But what's different as of late, beyond just gold, is that the miners are breaking out as well.
[SPEAKER_01]: Now historically, if you go look at the earnings profiles of these miners,
[SPEAKER_01]: You have good stretches where gold goes up, profits for miners go up, but it's usually short-lived because the volatility and lack of convicted buyers in the gold market.
[SPEAKER_01]: But as geopolitical instability rises, and the dollar has a more consistent downtrend, the market is starting to view these massive profits.
[SPEAKER_01]: Remember, most,
[SPEAKER_01]: of these miners are producing gold that around $2,000 per ounce.
[SPEAKER_01]: It ever take a little bit.
[SPEAKER_01]: Bends on the miner.
[SPEAKER_01]: And now at $3,700 an ounce, you can see there's a very large profit margin.
[SPEAKER_01]: And the trend remains up.
[SPEAKER_01]: And therefore, the market started to price in that these profits are not a flash in the pan.
[SPEAKER_01]: These are likely to be consistent for many, many years to come, and that we're in the early innings of the rally in the middle.
[SPEAKER_01]: That's what the breakout in the miners is telling us.
[SPEAKER_01]: So overall gold is a risk hedge.
[SPEAKER_01]: It's a diversifying asset.
[SPEAKER_01]: And it's flagging the risks both monetarily from high US debt and a fed that is becoming more politicized.
[SPEAKER_01]: But it's also flagging geopolitical risk of domestically and worldwide.
[SPEAKER_01]: And Goldman Sachs,
[SPEAKER_01]: mostly in emerging markets and they have taken a strong status that higher since the invasion of Ukraine and what's getting the confiscation of Russia's treasury assets.
[SPEAKER_01]: So this is the story that gold is sending to markets.
[SPEAKER_01]: And as most people get up and consume their particular form of media,
[SPEAKER_01]: and they pay attention, you should also more often than not pay attention to the story that markets are telling you as well.
[SPEAKER_01]: Those keep things going to swing back to the best stock voice bank right now.
[SPEAKER_07]: Hello, this is Paolo from Gatorsport Calling.
[SPEAKER_07]: Today I have a question for you guys about power ink.
[SPEAKER_07]: It's an industrial name.
[SPEAKER_07]: I guess like a mid to small cap.
[SPEAKER_07]: I'm not sure like it would
[SPEAKER_07]: the right time to get in.
[SPEAKER_07]: I already started a small position just to check the stock and curious about what you guys think about the company.
[SPEAKER_07]: It has a good outlook for the next five years so let's say.
[SPEAKER_07]: Looking forward to for your answer on the show as always and I appreciate the work you guys do.
[SPEAKER_07]: Thank you so much.
[SPEAKER_01]: Bye bye.
[SPEAKER_01]: are looking at Powell Industries and this manufacturer's power substation packages switching gears, circuit breakers, generators, controls, motor control systems, et cetera.
[SPEAKER_01]: And this is doing very well because of the Boom and AI, data infrastructure.
[SPEAKER_01]: And this is one of those picks and shovel type of companies.
[SPEAKER_01]: They only made five cents in 2021 that made $12.29 since last year, so it's made $13.63 this year and $14.50.
[SPEAKER_01]: 15 cents next year.
[SPEAKER_01]: And the trend is obviously higher.
[SPEAKER_01]: Good relative strength 93.
[SPEAKER_01]: Well, last quarter revenues were actually down 1% revenues were only up 4%.
[SPEAKER_01]: Going forward, growth is slowed considerably.
[SPEAKER_01]: So that's the worry here.
[SPEAKER_01]: Now, the good news is it's not really
[SPEAKER_01]: You know, for looking earnings is about $14, $14 on a $300 stock.
[SPEAKER_01]: It's about 20 times earnings, the less or a little more.
[SPEAKER_01]: But overall, that is...
[SPEAKER_01]: It's a bit extended for a company that hasn't shown this level of earnings consistently.
[SPEAKER_01]: That's my worry.
[SPEAKER_01]: And the cash flow, pretty cash flows only 81 million on a market cap of 3.6 billion.
[SPEAKER_01]: So I like the name, but I think it's a value that these levels, it's heading into resistance.
[SPEAKER_01]: So it's a name that I keep in my watch list, but I would want more consistency before buying into POW.
[SPEAKER_01]: Now we're heading into our final breaks.
[SPEAKER_08]: We have ready for an all new Invest talk with Webinar beyond the Mag 7.
[SPEAKER_08]: I would to identify AI opportunities across sectors.
[SPEAKER_08]: Happening online, September 30th from 1 to 2 p.m.
[SPEAKER_08]: Pacific Time.
[SPEAKER_08]: Seats are limited, so register now at InvestTalk.com.
[SPEAKER_06]: Hey Justin and Luke, a long time listener here from Wisconsin, but enjoying your chauffeur
[SPEAKER_06]: four or five years now and just appreciate it and thanks for taking the time to share your investing insights with us.
[SPEAKER_06]: The question is that the company I work for recently merged with a slightly larger company and just on that we're going to be changing my retirement plan managers from fidelity to principal financial group.
[SPEAKER_06]: Then just a very brief research on the internet seems like fidelity pops up generally is one of the top three with good customer service and
[SPEAKER_06]: on a larger asset under management companies, but generally if he principle financial group falling anywhere in the top pen on that list and read some negative reviews regarding their customer service and troubles transferring the columns and some fees, but I don't know those complaints are justified or warranted, but just curious what your opinion experience has been with financial group of things.
[SPEAKER_06]: You know, I have all my Roth IRA health things come brokerage count on fidelity right now and just trying to keep it centralized.
[SPEAKER_06]: Do I roll my accounts over to principle or just write it out and when every tire roll things back over to fidelity.
[SPEAKER_06]: Thanks for what you do guys.
[SPEAKER_06]: Bye.
[SPEAKER_01]: Well, you don't really have much choice.
[SPEAKER_01]: Your company is moving to principle.
[SPEAKER_01]: And your 401k is going to go over that over there.
[SPEAKER_01]: You won't have the opportunity to roll that into an IRA until you're 59 and a half or you leave the job.
[SPEAKER_01]: and no longer a full-time employee, so that's just unfortunately how it is.
[SPEAKER_01]: Now, principle, I've heard much bad about them.
[SPEAKER_01]: Fidelity is fine.
[SPEAKER_01]: I think they're bad when it comes to allowing their customers to use third-party apps.
[SPEAKER_01]: They're kind of using excuse to try to
[SPEAKER_01]: kind of gate-keep your data, which I think is terrible.
[SPEAKER_01]: So that's my biggest problem with fidelity right now.
[SPEAKER_01]: They tend to go against their...
[SPEAKER_01]: customers wishes and they use bad reasoning for that, but, you know, that's just where you're going to have to go and hopefully your investment options are solid over at principle.
[SPEAKER_01]: Every plan is different because it's one provider doesn't mean you're going to get the same investment options as someone else at principle as well.
[SPEAKER_01]: So you just have to go with it and if you leave your job, then you should roll that into an
[SPEAKER_01]: I would, we use Schwab, we prefer Schwab, but if you want to give it a fit out, you can do that as well.
[SPEAKER_01]: Now, let's play one more question from 8.99 chart.
[SPEAKER_03]: Hi, I was so thinking you could talk about a company called Navitas semi-conductor, the symbol is in VTS.
[SPEAKER_03]: I'm wondering if you think it looks like something that could be a long-term investment or something that seems too risky and maybe better suited for short-term traders.
[SPEAKER_03]: possible future potential might be related just to partnership with Lydia.
[SPEAKER_03]: Thank you so much.
[SPEAKER_01]: All right, looking at Navitas semiconductor, this is a name that won public back in 2021, and it's really been all over the place.
[SPEAKER_01]: It looks like one of those, let's think of public what public would be a spec, and originally did well when all we have to $20 in change, but then fell,
[SPEAKER_01]: Not that long ago, all the way to $1.50, that was back earlier this year, now we're up to $6.073.
[SPEAKER_01]: Now, they've never made money, and that's my worry, and so to me, it looks like the hype is all around their partnership with Nvidia.
[SPEAKER_01]: how much will that actually drive future earnings?
[SPEAKER_01]: Well, based on estimates from analysts, I'm not very confident.
[SPEAKER_01]: Well, earnings are expected to improve a little bit.
[SPEAKER_01]: So let's go from 25 since last year.
[SPEAKER_01]: Lots, sorry, a loss of 25 cents.
[SPEAKER_01]: Go a loss of 21 cents this year.
[SPEAKER_01]: And then a loss of 18 cents this year.
[SPEAKER_01]: None of that is, it's been better, but it's not a large improvement.
[SPEAKER_01]: Returning equity remains negative.
[SPEAKER_01]: They have a good balance sheet.
[SPEAKER_01]: That's a good thing.
[SPEAKER_01]: And the technicals are fine.
[SPEAKER_01]: But until they find some level of consistent profitability, then no, this is not a long-term hold.
[SPEAKER_01]: And it is completely all about the...
[SPEAKER_01]: short-term trends and it's a trading view called really only in and that hype around in video and it's products and the partnership they have with them certainly can have in flow and will have in flow and so you'll see a lot of volatility so no this is not a long-term hold at the current time it's more something you could trade in you know the technicals are fine right now so it could be a good bullish trade in the short-term but from a profit standpoint
[SPEAKER_01]: Well, I'm Justin Klein, and if today's show made you think about your own financial picture, in any way, your broader investment strategy, your tax strategy, your retirement strategy, as a whole, whether that's rough conversions, whether that is social security planning, whether that is saving for a kid's college or a child's wedding or whatever that is.
[SPEAKER_01]: We're here to help.
[SPEAKER_01]: I encourage you to head over to invest.com, look on the portfolio review button, and schedule a no-cost portfolio view with myself or Luke.
[SPEAKER_01]: And we take you for listening.
[SPEAKER_01]: I encourage you to tell your friends of family about a free podcast downloads which they can find anytime that iTunes Spotify or checkout our videos over on YouTube.
[SPEAKER_01]: And be sure to rate and review on iTunes as well.
[SPEAKER_01]: Independent thinking, shared success.
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