MARIA: WELCOME BACK.
FUTURES ARE INDICATING A SHARP
SELLOFF AT THE START OF TRADING,
DOWN ABOUT 300 AS AS WE LOOK
AHEAD TO A BIG WEEK.
IT IS THE END OF THE THIRD
QUARTER, IT IS THE END OF THE
FUNDING FOR THE GOVERNMENT,
CONSUMER CONFIDENCE COMING OUT
TOM ROW, WE’VE GOT THE GDP LATER
IN THE WEEK AND THEN OF COURSE
THE PERSONAL CONSUMPTION INDEX
OUT ON FRIDAY, THE FED’S
FAVORITE INFLATION INDICATOR.
JOINING HE ME RIGHT ME RIGHT NOW
ASSET MANAGEMENT CEO, KEN
MAHONEY.
WHAT ARE YOU EXPECTING AS YOU
LOOK AT THE TEND OF OF THE THIRD
QUARTER, WHAT KIND OF
POSITIONINGPOSITIONING MIGHT YOU
FROM INVESTORS THIS WEEK.
>> I THINK INVESTORS ARE
DEALING WITH THE PERFECT STORM,
LIKE FROM THE MOVIE.
REALLY CAME FROM ALL DIFFERENT
SIDES, RISING INFLATION, THE
FEDERAL RESERVE BEHIND THE
8-BALL OBVIOUSLY, OVERREACTING
TO LAST YEAR’S MIFF, HAVING TO
RAISE RATES NONSTOP AGGRESSIVELY
AND THE OTHER SHOE TO DROP IN
THE PERFECT STORM SCENARIO IS
OUT OF EARNINGS.
WE’LL CLOSE OUT THE QUARTER THIS
FRIDAY AND A FEW WEEKS FROM THEN
WE’LL GET THE REPORTS AND A
STRONG DOLLAR WILL HURT A LOT OF
MULTINATIONALS.
THAT’S THE CONCERN FOR
INVESTORS, THE ONES THAT ARE
OBVIOUS ARE INFLATION, THE
FEDERAL RESERVE.
THE ONE NOT SO OBVIOUS IS A
STRONGER DOLLAR, WEAKER
EARNINGS.
MARIA: WE’VE GOT AN ALL TIME
LOW ON THE BRITISH POUND THIS
MORNING AND THE DOLLAR CONTINUES
TO SOAR.
BUT KEN, WE’VE BEEN HEARING
THESE LIKE DIRE ECONOMIC
PREDICTIONS FROM SO MANY PEOPLE
WHETHER IT’S JAMIE DIMON AND THE
ECONOMIC HURRICANE THAT’S COMING
OR RAY DALIO AND THE RECESSION
THAT IS ALREADY HERE, LARRY
SOMMERS SAME THING, WE KEEP
HEARING ALL ABOUT THIS THAT IT’S
GOING TO START TURNING UGLY IN
THE FOURTH QUARTER.
FOURTH QUARTER BEGINS NEXT WEEK
AND LOOK AT THE DEPANNED HE
DESTRUCTION WE’VE SEEN -- DEMAND
DESTRUCTION WE’VE SEEN IN A
NUMBER OF INDUSTRIES. WE HAVE A BIG WEEK OF HOUSING
WE HAVE A BIG WEEK OF HOUSING
TAKEDATA, THE KAYE SCHILLER INDE
THE 30 YEAR MORTGAGE HIT THE
HIGHEST LEVEL SINCE AUGUST OF
2007.
WHAT ARE YOU EXPECTING IN TERMS
OF THE MACRO STORY AND DOES IT
BEGIN IN THE UPCOME COULDING
FOURTH QUARTER, THIS ECONOMIC SHARP WEAKNESS.
SHARP WEAKNESS.
>> THE MARCH AT THE END OF THE
OF THE VIEWER’S BIGGEST ASSET IS
THEIR HOME AND YOU SEE THE
NEIGHBOR SLASH 50, 100,000 OFF
THEIR HOME.
I’M HEARING FROM REALTORS THAT
USED TO HAVE 30, 40 PEOPLE
SHOWING UP AT A SHOWING, AND NOW
IT’S TWO OR THREE PEOPLE SHOWING
UP.
THAT HAS A BIG IMPACT.
THE PEOPLE WON’T GET APPLIANCES
OR UPGRADE THEIR KITCHEN OR PUT
A DECK ON, YOU START FEELING IT
RIGHT THERE.
IT’S THE ON T SIT OF WEALTH --
OPPOSITE OF WEALTH EFFECT.
MAYBE THIS IS THE UNINTENDED
CONSEQUENCES BUT AGAIN, BLOWING
THIS BIG CANNON OUT, MONETARY
POLICY, THE REAL INFLATION IS
MORE ABOUT SUPPLY CHAINS, SUPPLY
AND DEMAND ISSUES WITH OIL, NOT
BY BLASTING RATES AND IMPACTING
THAT IN THE REAL ESTATE MARKET
BUT HERE WE ARE.
MARIA: SO WHAT DO YOU DO AS AN
INVESTOR, KEN, AS THE MARKETS
WEAKEN, AS THE MACRO STORY SLOWS
FURTHER.
THE NASDAQ IS DOWN BETTER THAN
5% IN A FEW WEEKS, THE
TECHNOLOGY SECTOR FACING THE
WORST TWO WEEK STRETCH SINCE THE
START OF THE PANDEMIC.
IS THIS AN AREA TO LOOK FOR
BARGAINS OR DO YOU WANT TO STEP
AWAY FROM STOCKS FOR A WHILE
WHILE THINGS SETTLE OUT AHEAD OF
THESE ECONOMIC UPSET
EXPECTATIONS?
>> WELL, YOU WANT TO KEEP YOUR
POWDER DRIVE.
WE WANT TO BE ALIVE ON THE OTHER
SIDE OF THIS THING, HAVE YOUR
PRINCIPAL WITH YOU.
A TRADER MENTIONED A COUPLE
WEEKS AGO HERE, WHAT YOU CAN DO
-- LOOK, SOME PEOPLE THINK IT’S
TOO LATE TO SHORT AND TOO EARLY
TO BUY.
I SEE A LOT OF PEOPLE WITH SHORT
PORTFOLIOS NOW.
OKAY.
AND A COUPLE WEEKS AGO I
MENTIONED A PAIR TRADER WHEN YOU
BUY A STOCK AND SHORT A STORKS
YOU KEEP YOURSELF MARKET
NEUTRAL.
THE ONE I MENTIONED WAS
MICROSOFT LONG FOR ALL THE
REJORNTION 69% MARGINS --
REASONS, 69 MARGINS.
THE R SHORT WAS META, DOING
EVERYTHING THEY CAN DO,
SWITCHING INTO THE META VERSE
WILL BE NICHEY.
YOU HAVE META DOWN 18%.
THAT’S A 13% PICK-UP IN TWO
WEEKS, BY BUYING -- AND I THINK
TAKE THAT TRADE CAN CONTINUE FOR
SOME TIME.
LONG MICROSOFT, SHORT META.
MARIA: ALL RIGHT.
WE WILL BE WATCHING THAT TRADE.