ON THE DOW TODAY.
TRISH: THANK YOU VERY MUCH,
GEAR.
WE'LL KEEP WATCHING IT.
I HAVE ON SET, BELLPOINTE
STRATEGIST DAVID NELSON AND AND
DOUG FLYNN.
GOOD TO SEE YOU, BOTH.
DAVID NELSON, DOWN 200.
WHY?
>> GERRI HIT A COUPLE OF KEY
POINTS.
WALMART SET UP WITH A NEGATIVE
TONE.
EVEN WITHOUT WALMART'S NUMBERS
WE WERE LIKELY LOOKING FOR A
PULLBACK.
THIS STARTED WITH INFLATION AND
RATES MOVING HIGHER.
COMING INTO THE WEEK WE SAW THE
10-YEAR 2.9%.
THAT IS WHERE IT STARTED BUT I
THINK IF I CAN TAKE IT BACK TO
LAST WEEK, THAT DRAMATIC RISE
OFF THE BOTTOM, FOR A LOT OF
INVESTORS, VERY SLIGHT DECLINE
WE'RE HAVING SPEAK AS LOT OF THE
MARKET.
A LOT OF INVESTOR SAW WE HAVE
INFLATION HERE THERE IS STILL A
LOT OF GROWTH AND EARNINGS POWER
OUT THERE.
BIG INVESTMENT HOUSE, BLACKROCK
CAME OUT ENDORSING THAT.
I WOULD POINT OUT THERE IS A LOT
OF THINGS YOU CAN DO TO MASSAGE
THE BOTTOM LINE ON INCOME
STATEMENT, GROWTH YOU HAVE IT OR
DON'T.
50% OF THE COMPANIES IN THE
S&P 500 ARE HAVING A POSITIVE
SALES SURPRISE.
I THINK THIS IS A MILD PULLBACK
RIGHT NOW.
WE PROBABLY NEED IT TO DIGEST
WHAT WE DID LAST WEEK.
TRISH: RETAIL SALES NUMBERS ARE
NOT LOOKING SO GOOD.
DOUG, YOU LOOK WHAT WE SAW ON
RETAIL SALES FRONT.
LOOK AT WALMART COMING UP SHORT
TODAY.
>> RIGHT.
TRISH: MY HOPE IS THIS IS JUST A
BLIP, RIGHT?
AS WE MOVE FORWARD, PEOPLE GET
MORE MONEY IN THEIR PAYCHECKS.
>> EXACTLY.
TRISH: THEY WILL HAVE MORE MONEY
TO SPEND AND THEY HAVE TO BE
FORWARD THINKING BUT YOUR TAKE?
>> THAT'S TRUE.
WE HAVEN'T REALLY FELT EFFECTS
OF THAT.
THE FIRST PAYCHECK STARTED MOST
RECENTLY.
THAT DIDN'T WORK ITS WAY IN.
THAT BEING SAID AFTER YOU HAVE A
YEAR LIKE LAST YEAR IT, WOULD BE
COMPLETELY NORMAL TO HAVE A
NORMAL CORRECTION AND THAT IS
USUALLY AROUND 15 TO 16%.
WE HAD OFFICIAL CORRECTION OF
10.
WE TOUCHED ABOUT 12.
WE BOUNCED BACK UP.
WE HAD THE BEST WEEK IN FIVE
YEARS LAST WEEK.
I THINK IT WOULDN'T BE
UNREASONABLE TO THINK WE GO BACK
DOWN AND RETEST THAT, MAYBE HIT
A NORMAL CORRECTION AFTER YEAR
LIKE LAST YEAR.
THEN YOU RESUME.
I THINK WE'LL GET DOUBLE-DIGIT
RETURNS BY THE END OF THE YEAR.
THIS IS ONE OF THE OPPORTUNITIES
THAT YOU HAVE.
WALMART IS DEFINITELY ON THE
LOWER END OF THE RISK SPECTRUM
COMPARED TO A LOT OF TECHNOLOGY
COMPANIES.
THAT IS OPPORTUNITIES YOU'RE
LOOKING FOR.
TRISH: DAVID NELSON, DOES ANY OF
THIS FACTOR INTO WHAT THE FED
WILL DO?
WHEN THEY LOOK INTO RETAIL
NUMBERS AND DON'T SEE UP TICK
WHAT PEOPLE ARE SPENDING WILL
THEY HOLD OFF?
>> NOT CHANGING ANY DYNAMIC
RIGHT NOW.
I CAME IN, I LOOKED AT MY
SCREEN.
SEE ONE HUNDRED% PROBABILITY OF
A RATE HIKE.
PROBABLY MOST OF THE YEAR.
I THINK THEY'RE GETTING BACK TO
PATH ON NORMALIZATION.
THEY ARE STUCK BETWEEN A ROCK
AND A HARD PLACE.
THEY WOULD LIKE TO PAUSE A BIT
BUT THEY HAVE TO RELOAD.
EVENTUALLY WE'LL HAVE SOME KIND
OF, SOME KIND OF ECONOMIC
PULLBACK, SOMEWHERE DOWN THE
ROAD.
THEY DON'T HAVE THE BULLETS
HERE.
DOUG HIT ON AN IMPORTANT POINT.
A LOT OF DYNAMIC, ACCELERATION
IN THE ECONOMY.
THAT IS NOT JUST A WALL STREET
EVENT.
THAT IS TRANSLATING TO MAIN
STREET.
PEOPLE ARE EXCITED ABOUT SEEING
A LITTLE BIT OF A BUMP IN THEIR
PAYCHECK.
THAT WILL PAY DIVIDEND WHEN WE
GET INTO THE MIDTERMS.
TRISH: SOUNDS LIKE YOU'RE BOTH
ON TIS MICK ABOUT THINGS RIGHT
NOW.
YOU ARE?
>> I FEEL PRETTY GOOD.
>> FEEL PRETTY GOOD?
>> I DO.
TRISH: DOUG?
>> I DO AS WELL.
17 TIMES EARNINGS.
GET A 10% CORRECT, YOU'RE AT 15
TIMES EARNINGS.
WHAT MORE DO YOU WANT TO GET IN
AND INVESTED IN THE LONG HAUL.
THAT IS WHAT WE'RE TALKING
ABOUT.
NOT MONEY YOU NEED TOMORROW.
TRISH: I FEEL PRETTY GOOD TOO.
AND YOU SAY YOU GET PAID TO
WORRY.
I JUST WORRY NATURALLY.
THAT IS ONE OF THE THINGS THAT I
DO.
I HAVE BEEN VERY WORRIED AT
VARIOUS TIMES ABOUT THIS MARKET.
I LOOK FOR ALL THE SIGNS THAT
WOULD SEND US LOWER.
I WAS CALLING LEHMAN LONG BEFORE
THAT WHOLE --
>> TALKING TO RECESSION OR
ANYTHING RECESSIONARY.
TRISH: RIGHT.
>> NUMBERS LIKE THIS NOW.
THIS IS CORRECTION.
WE GET THESE.
WE'VE HAD 1CORRECTIONS SINCE THE
'70s.
TRISH: WE CAN HANDLE
CORRECTIONS.
AS LONG YOU'RE NOT TALKING ABOUT
A SYSTEMIC CRISIS THAT WILL SEND
US TOWARDS A PATH TOWARDS
RECESSION.
THAT IS NOT OUT THERE, RIGHT?
>> TRUE.
TRISH: MARKET VOLATILITY IS
GOOD.
THAT GIVES PEOPLE A OPPORTUNITY
TO GET IN.
YOU DO WANT PEOPLE WITH LITTLE
BIT OF TREPIDATION, ONCE IT'S A
PARTY, EVERYBODY IS BACK, THAT
IS WHEN I GET WORRIED.
GOOD TO BE POSITIVE.
YOU STILL NEED PEOPLE THAT DON'T
BELIEVE IN THE MARKET TO HOLD
BACK FROM GETTING TOO FAR TOO
FAST.
>> DOUG MAKES A VERY IMPORTANT
POINT.
REVERSION TO THE MEAN IS VERY
IMPORTANT.
WE CRASHED THROUGH THE 50-DAY,
AND 100-DAY.
LESS THAN A WEEK WE WERE ABOVE
THE 50-DAY AGAIN.
IT IS NOT THAT BAD.