BEATEN YET THE YIELD ON OUR
BONDS IS GET A BIG HUT.
WHERE DO YOU FIND THE BEST
RETURN FOR YOUR CASH?
WE BEGIN WITH THREE THINGS
INVESTORS OUGHT TO BE THINKING
ABOUT RIGHT NOW.
BIG TECH STOCKS LED THE WEEK’S
MARKET RALLY.
NOW INVESTORS ARE TURNING THEIR
FOCUS TO THE WEDNESDAY RATE
HIKE DECISION.
THE BANK TURMOIL ISN’T OVER.
DEPOSITORS YANK THEIR CASH OUT
OF FIRST REPUBLIC.
IS THE CONTAGION CONTAINED?
INTRODUCING CAN VIEW.
WHAT TO EXPECT FROM THE BIGGEST
IPO OF THE YEAR AS JOHNSON &
JOHNSON SPINS OFF ITS HEALTH
BUSINESS.
BEN LEVISOHN, CARLETON ENGLISH
AND ANDREW BARY.
THE S&P CONTINUES TO INCH
HIGHER ON THE SURFACE, NOT MUCH
IS HAPPENING.
KIND OF BORING.
BEN: THE STOCK MARKET HAD A
MICROSOFT LANDING, PARDON THE
PUN.
MICROSOFT HAD GREAT EARNINGS,
ALPHA THAT WENT UP 1.7% AFTER
IT EARNINGS, META JUMPED 13%
AND THESE BIG STOCKS ARE DOING
THE HEAVY LIFTING FOR THE STOCK
MARKET.
THAT IS WHY ALL THREE MAJOR
INDICES, THE S&P, THE DOW AND
THE NASDAQ FINISH TIRE.
JACK OTTER: INVESTORS CHEERED
META-GETTING OUT OF THE
META-VERSE.
HERE’S THE THING.
BIG TECH GENERALS ARE LEADING
THE MARCH HIGHER, THEY ARE NOT
DOING VERY WELL.
WHAT’S GOING TO HAPPEN?
WILL THEY DRAG EVERYONE WITH
THEM OR ARE THEY GOING TO MOVE
ASIDE?
BEN: THEY WILL MOVE ASIDE.
THEY ARE DRIVEN BY LOWER YIELDS
AND BAD SENTIMENT TOWARD BIG
TECH STOCKS BUT WE’VE SEEN BOTH
OF THOSE READY TO REVERSE.
EVERYONE IS BUYING THEM BECAUSE
THEY SAY THESE ARE THINGS THAT
WORKED BEFORE, HAD A BAD YEAR.
THEY’VE DONE GREAT.
THEN LOOK AT THE YIELDS AND
THEY HAVE COME DOWN.
AS FAR AS THEY ARE GOING TO FOR
A WHILE.
THEN YOU LOOK AT EVERYTHING
ELSE AND ACTING AS IF A
RECESSION IS COMING.
YOU NEED SOMETHING TO PICK UP
THE BATON.
JACK OTTER: WE HAVE THE FED
MEETING, 25 BASIS POINTS AND WE
WILL HAVE A JOBS REPORT FOR
APRIL.
WHAT WILL YOU BE WATCHING?
BEN: WE ARE LISTENING TO WHAT
THE FED SAYS, NOT WHAT IT DOES.
THE MARKET EXPECTS A QUARTER
POINT HIKE.
THAT IS WHAT WILL HAPPEN.
ON THE MARKET EXPECTS A STOP.
I THINK THE FED MIGHT PORTRAYED
AS A PAUSE.
THE STOCK MARKET IS PREDICTING
A CUT LATER THIS YEAR.
THAT IS WHAT THEY ARE LISTENING
TO.
THE JOB REPORT WILL BE
IMPORTANT BUT IT WILL COME
AFTER THE FED MEETING.
NOT SURE IT WILL HAVE MUCH
IMPACT AFTER THE WEDNESDAY
MEETING.
JACK OTTER: WE DON’T HAVE TO
WORRY ABOUT A BANKING
CONTAGION.
IT SEEMS TO BE DIFFERENT.
CARLETON: WE SAW MOST OF THE
BANKS REPORT EARNINGS.
WE HAVE A LOT OF BEATS, MOST
WERE IN LINE.
IT WAS WITHIN A REASONABLE
MARGIN.
WHAT SHOCKED THE MARKET WAS THE
EXTENT OF THE DEPOSIT FLIGHT,
100 BILLION LEFT, JPMORGAN AND
TEN OTHER BANKS.
WITH THAT, IT IS A UNIQUE
SITUATION, A BANK THAT CATERS
TO WEALTHY CLIENTELE, KNOWN FOR
OFFERING SWEETHEART DEALS,
MORTGAGES, AND OTHER LENDING.
THAT’S NOT A TRADITIONAL
BANKING MODEL THAT WORKS IN A
RISING RATE ENVIRONMENT.
JACK OTTER: MORTGAGES ON LATE
HOUSES.
ANDREW: THEY ARE CONCENTRATED
IN EAST HAMPTON, CONNECTICUT.
CARLETON: AND PAYING ONE% ON
SOME OF THE.
THE AVERAGE LOAN PORTFOLIO HAD
A YIELD OF 3.2% WHICH, NOT VERY
ENTICING FOR ANYONE LOOKING AT
THE BANKS.
JACK OTTER: DOES THIS MEAN
CUSTOMERS AT REGIONAL BANKS CAN FEEL HER MONEY IS SECURE?
FEEL HER MONEY IS SECURE?
CARLETON: CUSTOMERS OF THE
BANKS, FDIC INSURANCE, 250,000,
THAT APPLIES TO MOST PEOPLE.
YOU HAVE TO THINK OF FIRST
REPUBLIC.
WELL IN EXCESS OF THAT, LOOK AT
THE UNINSURED DEPOSIT LEVELS,
NOT JUST THE SAME EXTENT IT WAS
AT FIRST REPUBLIC ON A STOCKS
MIGHT BE CHALLENGING BUT YOUR
MONEY, YOUR SAVINGS ARE SAFE.
JACK OTTER: THE IPO MARKET
DRIED UP WHEN THE MARKET WENT
SOUTH LAST YEAR BUT THERE’S A
BIG IPO COMING, JOHNSON &
JOHNSON SPINNING OFF ITSELF.
ANDREW: THEIR CONSUMER HELP
BUSINESS INCLUDES BRANDS LIKE
TYLENOL, BAND-AID, LISTERINE,
JOHNSON’S BABY PRODUCTS.
IT SHOULD GO PRETTY WELL.
JACK OTTER: I DON’T HOW THEY
ENDED UP WITH CAKEN VIEW BUT ON
OF THE BEST TIMES TO BUY IPOs
IS WHEN NO ONE WANTS OF THEM.
IF YOU CAN COME TO MARKET IN THIS ENVIRONMENT IT IS NOT
THIS ENVIRONMENT IT IS NOT
HEALTHY COMPANY.
ANDREW: IT IS VALUED 16 TIMES
LAST YEAR, 3.
5% PLUS DIVIDEND YIELD, DURABLE
BRAND AND REASONABLE GROWTH PROSPECTS.
PROSPECTS.
JACK OTTER: WE HAVE TWO
COMPANIES INSTEAD OF ONE, YOU
THINK THEY ARE SIMILAR?
ANDREW: J&J GOES FASTER WITH
ITS PHARMACEUTICAL AND MEDICAL
DEVICES BUT FROM A STOCK MARKET
PERSPECTIVE IT CAN HOLD ITS
OWN.
JACK: YOU THOUGHT THE SPINOFF
WAS NOT NECESSARY.
JACK: DON’T KNOW WHY THEY NEED
TO DO IT.
FOR YEARS THEY SAID THE GOAT
COMPANY WAS BETTER OFF
TOGETHER.
THEY MEAN JUMPING ON THE
SPINOFF TREND IN THE INDUSTRY. YOU HAVE A NICE COMPANY MERGING