MARIA: WELCOME BACK.
SOCIAL UNREST IN CHINA WEIGHS ON
HE GLOBAL MARKETS THIS MORNING
AFTER THE SHORTENED HOLIDAY
WEEK.
FUTURES INDICATING A AT THE
DECLINE AT THE START OF TRADING,
DOWN 162 ON THE DOW INDUSTRIALS,
NASDAQ DOWN 98.
JOINING ME TO LOOK AHEAD TO YEAR
END AND ’23 IS MAHONEY ASSET
MANAGEMENT CEO, KEN MAHONEY.
GOOD MORNING TO YOU.
THANK YOU FOR BEING HERE.
WILD PICTURES COMING OUT OF
CHINA THIS MORNING OF ALL OF THE
UNREST, PROTEST THERES
PROTESTING ZERO COVID POLICY AND
THE COMMUNIST PARTY, XI JINPING,
CALLS TO STEP DOWN.
DO YOU THINK THIS WILL HAVE AN
IMPACT THE WAY IT’S HAVING ON
MARKETS THIS MORNING?
>> I THINK SO.
I THINK LIZ AND DAGEN SAID ALL
OF THE ABOVE WHICH IS THE
DRACONIAN LOCKDOWNS, FOR THE
REST OF THE WORLD TO SEE THIS.
CHINA DOES EVERYTHING IT CAN DO
TO SUPPRESS INFORMATION.
THIS IS AN INTERESTING TEST,
THIS IS A TIANANMEN SQUARE
MOMENT FOR THE CHINESE PEOPLE TO
BE LOCKED DOWN AN TREATED LIKE
ANIMALS.
IT’S NOT ABOUT COVID.
IT’S MORE ABOUT CONTROL AND
POWER AND XI EXERTING THAT POWER
AND USING COVID AS AN EXCUSE.
MARIA: WELL, LOOK, WE NEVER
HEARD FROM THIS ADMINISTRATION
IN TERMS OF SUPPORT FOR THE
PEOPLE OF IRAN.
YOU HAD COURAGEOUS WOMEN ON THE
GROUND IN IRAN, PUSHING BACK ON
THAT AUTHORITARIAN GOVERNMENT.
SO DON’T EXPECT ANY COMMENTS
FROM THIS ADMINISTRATION TO SIDE
WITH THE PEOPLE OF CHINA.
BUT WE’LL BE WATCHING TO SEE IF
THE WHITE HOUSE HAS ANYTHING TO
SAY ABOUT THIS.
MEANWHILE, MARKETS THIS MORNING
ARE IMPACTED.
THEY ARE DOWN.
OIL IS ALSO DOWN, DROPPING BELOW
$76 A BARREL.
BIDEN’S TREASURY DEPARTMENT
ANNOUNCED IT WILL ALLOW CHEVRON
TO HE RESUME PUMPING OIL IN
VENEZUELA, HE KEN.
THIS AS OPEC IS SET TO MAKE A
BIG CALL ON L ON OIL PRODUCTION
WEEK, A DAY BEFORE SANCTIONS ARE
SET TO STRIKE RUSSIA’S INDUSTRY.
WHAT ARE YOUR THOUGHTS ABOUT OIL
AND HOW IT IMPACTS STOCK.
>> WE SAW YOU WITH CHINA A SLOW
BECAUSE OF THE DRACONIAN
LOCKDOWNS AND DEMAND COMING
DOWN.
WE ARE IN AN ENERGY POLICY
MISCUE BECAUSE OF THIS
ADMINISTRATION.
WE WENT TO ENERGY DEPENDENT IN
ABOUT 19 MINUTES.
REALLY THE ATMOSPHERE, WHETHER
YOU DRILL UNDER YOUR OWN FEET OR
VENEZUELA HAS THE SAME IMPACT.
THE LOGIC NEVER MADE SENSE.
SEEMS LIKE WE HAVE TO GO AROUND
TO PEOPLE WHO HATE US AROUND THE
WORLD, WE GO TO SAUDI AND
VENEZUELA FOR OIL.
THIS ADMINISTRATION HAS PUT A
CROSS HAIR INTO THE OIL
INDUSTRY.
THIS IS ANOTHER ONE OF THOSE
MOMENTS FOR THE BIDEN
ADMINISTRATION.
MARIA: MEANWHILE, KEN, WE ARE
RIGHT NOW ON THE DOORSTEP OF THE
FINAL MONTH OF THE YEAR.
WE’VE GOT FEDERAL RESERVE
CHAIRMAN JAY POWELL SET TO SPEAK
ON THE ECONOMY AND LABOR MARKET
THIS WEDNESDAY.
HE’S ALSO EXPECTED TO ANNOUNCE
THE FED WILL BEGIN SLOWING DOWN
THE RATE HIKES.
THIS IS ONE OF THE LAST TIMES
WE’LL HEAR FROM POWELL UNTIL THE
FED MEETING ON DECEMBER 13 AND
14.
SO WHAT ARE YOU EXPECTING FROM
THE FED MEETING AND HOW ARE YOU
INVESTED GOING INTO YEAR END?
DECEMBER 1st THIS WEEK.
>> RIGHT.
SO FIRST PART, AS FAR AS POWELL
THEY INDICATED THEY’RE GOING TO
SHOWSLOW DOWN, PROBABLY EXPECT 5
BASIS POINTS.
I LIKE TO THINK WE’RE IN THE
SEVENTH OR EIGHTH INNING OF THIS
AND WE DON’T HAVE TO DID GO GO T
INNINGS.
THERE ARE SOME FED GOVERNORS
THAT WANT TO PUSH THE RATE PAST
5%.
VALUE’S HAD A PRETTY DECENT
YEAR.
IT’S THE GROWTH STOCKS, THE
GROWTH NAMES THAT INFLATION’S
BEEN BITING THEM.
THE NASDAQ IS DOWN MORE THAN 20%
YEAR-TO-DATE.
I THINK GOING FORWARD, THE
MIDTERM ELECTIONS ARE POSITIVE.
THAT’S A HEALTHY TAIL WIND,
OBVIOUSLY.
YOU HAVE THE SEASONALITY EFFECT
AND OF COURSE SOME OF THE OTHER -- BUT I GUESS THE PROBLEM WE
-- BUT I GUESS THE PROBLEM WE
HAVE TO THROW A ET WET ET WET
THIS, IT’S EARNINGS.
HIGHER UNIT COSTS, LABOR COSTS,
AND YOU KIND OF START PLAYING
AROUND WITH NUMBERS, YOU GET TO
THE S&P 5 A HUNDRED 500 EARNINGS
LISTEN200TO 210.
WE KNOW BY THE WAY MARKETS ARE
VERY ELASTIC.
THEY CAN TRADE WELL ABOVE THAT
VALUE NUMBER.
WELL BELOW, FOR THAT MATTER.
BUT AGAIN, JUST GET A SENSE
HERE.
THE CLOUDS ARE FORMING IN CHINA.
WITH THE WEIGHT OF THE S&P 500
KIND OF AROUND FAIR VALUE-ISH WE
WOULD BE LOOKING TO SELL INTO
THIS RALLY A LITTLE BIT.
MARIA: CAUTIOUS GOING INTO YEAR
END AFTER A PRETTY GOOD
NOVEMBER.
DEPENDING ON WHICH AVERAGE YOU
LOOK AT, TALKING ABOUT 2, 2 OF
AND-A-HALF TO 4% GAINS FOR THE
MAJOR INDICES IN THE MONTH OF
NOVEMBER SO FAR.
KEN, IT’S GREAT TO CATCH UP WITH