This week's Alpha Trader podcast features hosts Aaron Task and Stephen Alpher chatting with Kevin Simpson of Capital Wealth Planning.
For a few months now, Task and Alpher have held that the Fed successfully engineered a soft landing in 2019, leading to a healthy bull market, a la 1995. The action of late though has them questioning whether we're now closer to a bubbly late-1999 scenario. They remind that Cody Willard was on the podcast just weeks ago making the bull case for names like Tesla (TSLA), Virgin Galactic (SPCE). They've both gone parabolic since, making even Willard wonder whether things have gotten too perky.
With plenty of other news surrounding markets, many didn't pay attention to Fed Chair Jay Powell's congressional testimony, but - in a time of record-low unemployment, minuscule interest rates, record-high equities, and a $1T government deficit - he called on Congress to do more to support the economy. It indicates that another recent Alpha Trader guest, Tony Dwyer had it right when he argued about a sea change in thinking at the Fed - the central bank has given up the inflation battle and is instead laser-focused on not allowing a Japan- or Europe-like deflationary environment take hold. Invest accordingly.
Acknowledging the hit to earnings from the coronavirus for plenty of the large-cap dividend growers he likes to hold, Kevin Simpson reminds it's not likely to affect the long-term profit power of players like Disney (DIS), Home Depot (HD), and Walmart (WMT). A writer of calls on the names he holds, Simpson recently had his Apple (AAPL) called away. A longtime owner of Apple, Simpson says it's not the first time he's been out of the stock during its run higher. It remains one of his favorite names, and he expects to be able to buy it back cheaper than it is today.
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