Derek Moore and Shane Skinner give their thoughts on the Fed, interest rates, and the Trump vs. Powell situation. Plus, looking at new data on how much revenue US companies derive from overseas markets. Later the talk about what many get wrong about where their stock market returns come from year over year plus those crazy surveys and inflation expectations. Finally, they talk about what the option market is expecting around TSLA earnings

How long are Fed Governor terms?

How long is the term of the Federal Reserve Chair?

Where returns come from changes in revenues, margins, EPS, buybacks, and dividends

Q2 Earnings Season kicks off

Will earnings beat by more than people expect?

What percentage do S&P 500 Index companies revenues come from overseas?

What about the Mag 7 percentage of foreign earnings?

U of Michigan inflation survey still shows crazy disparity between democrats and republicans

Trump vs Powell debate

Fed interest rate probabilities

Will the Fed lower interest rates in July?

What the options market says about the TSLA earnings move this week

TSLA implied volatility

Mentioned in this Episode

Semper Augustus 2021 letter talking about where returns come from over longer periods https://static.fmgsuite.com/media/documents/db64b928-53d6-43a9-a4d0-a9d2f69f76ba.pdf

Derek Moore's book Broken Pie Chart https://amzn.to/3S8ADNT

Jay Pestrichelli's book Buy and Hedge https://amzn.to/3jQYgMt

Derek's book on public speaking Effortless Public Speaking https://amzn.to/3hL1Mag

Contact Derek [email protected]

Derek Moore and Shane Skinner examine some market myths. Does a weak dollar mean problems for the stock market? Looking at tax rates and the effect on government spending vs revenue. Plus, some international market ETFs are up huge so can they continue? Later, looking at the national debt and when it might matter. All that and more market musings.

Best performing international markets

Is the US Dollar weakness really that bad compared to other periods

Government revenue as a percentage of GDP

Government expenditure as a percentage of GDP

Do higher tax rates really make a difference when it comes to revenues and debt?

Looking at options market pricing of JP Morgan options ahead of earnings

Implied volatility of options prior to earnings estimated expected one standard deviation moves

How a weak dollar can raise earnings from multinational companies

Comparing the change in the US Dollar to the change in the S&P 500 Index

Are the US Dollar and the S&P 500 Index correlated?

Mentioned in this Episode

Derek Moore's book Broken Pie Chart https://amzn.to/3S8ADNT

Jay Pestrichelli's book Buy and Hedge https://amzn.to/3jQYgMt

Derek's book on public speaking Effortless Public Speaking https://amzn.to/3hL1Mag

Contact Derek [email protected]

Derek Moore looks at some data showing that buying markets at all-time highs isn't so bad. Plus, after years of listening to how the dollar has lost 90% of its value or more, let's set the record straight about whether this is a fallacy or truth. You might be surprised by the data. Then, examine the volatility and drawdowns of gold prices. Yeah, they drawdown more than you'd have thought. Oh, and going long the F1 Movie!

Comparing drawdowns in Gold, S&P 500 index, and 5-Year Treasuries over the last 18 years

How to calculate the loss in purchasing power of the U.S. Dollar

Inflation adjusted returns across 3-Month Treasury Bills, S&P 500 Index, and Gold

Comparing putting your money under a mattress vs storing it in 3-month T-bills

Why the dollar has lost almost all its value over time is a lazy statement

Stock market returns after it reaches an all-time high

Time to recover in the S&P 500 Index post a decline of -19% or more

Mentioned in this Episode

Derek Moore's book Broken Pie Chart https://amzn.to/3S8ADNT

Jay Pestrichelli's book Buy and Hedge https://amzn.to/3jQYgMt

Derek's book on public speaking Effortless Public Speaking https://amzn.to/3hL1Mag

Contact Derek [email protected]

Derek Moore is joined again by Spencer Wright from Halbert Wealth to talk about the market breaking out to another all-time high and how hated a rally this is. Then they discuss semiconductors finally catching up to their only July 2024 highs. Then they talk about Chamath Palihapitiya's criticism of Apple and a Bloomberg report that Apple had talks about buying AI company Perplexity. Finally, some odds and ends like whether oil prices on an inflation adjusted basis are lower than in the 1970s and whatever else we covered.

Back to all-time highs

Semiconductors finally join the party

Chamath Palihapitiya's criticism of Apple

Bloomberg report that Apple had talks about buying AI company Perplexity

Crude oil inflation adjusted price

Is this still a hated rally by the street?

Odds and ends

Mentioned in this Episode

Bloomberg article talking about Apple potentially buying Perplexity

Derek Moore's book Broken Pie Chart https://amzn.to/3S8ADNT

Jay Pestrichelli's book Buy and Hedge https://amzn.to/3jQYgMt

Derek's book on public speaking Effortless Public Speaking https://amzn.to/3hL1Mag

Contact Derek [email protected]

Derek Moore looks to answer the question on whether Hedged Equity or the 60/40 stock bond portfolio is a better fit given where we are and why. How bonds had a 40-year bull market but is it likely that is possible again given where we are? Later, looking at market returns after CNBC does their 'markets in turmoil' specials when markets are selling off. Plus, why debate about should or shouldn't the Fed lower rates is getting tired and does it even matter outside of housing?

Debate around Fed lowering rates

Impact of Fed rates on real estate housing market

Spread between 10-year treasury yield and the 30-year treasury bond yield

60/40 portfolio vs hedged equity portfolio

Dynamics of falling and rising interest rate environments

Short interest on the high side on the total US market

Contrarian indicators

Mentioned in this Episode

Derek Moore's book Broken Pie Chart https://amzn.to/3S8ADNT

Jay Pestrichelli's book Buy and Hedge https://amzn.to/3jQYgMt

Derek's book on public speaking Effortless Public Speaking https://amzn.to/3hL1Mag

Contact Derek [email protected]

Derek Moore examines markets around historical geopolitical events. Plus, the 2020s are trending to be the most volatile decade and by the way we are up over 80% so far. Then, looking at the pop in gold and crude oil this week and perspective on where those markets are. Plus, a contrarian take that housing is actually cheap. Later talking semiconductor stocks, the US dollar index, inflation, and useless sentiment surveys.

1-year forward inflation expectations U-Michigan survey

Sentiment gets better

Gold breaks out of its most recent range while crude oil breaks back into its prior range

US Dollar bearishness is the prevailing opinion so is it too crowded of a view?

Semiconductors 40%+ off the bottom but still sideways since their all-time high in July 2024

Markets 1-year later after geopolitical events

Will the 2020s have the most 1% +/- days ever?

S&P 500 Index earnings expectations forward 12 months update

Price per square foot US Housing National average

Is housing cheap when considering adjustments for inflation and average square footage?

Mentioned in this Episode

Derek Moore's book Broken Pie Chart https://amzn.to/3S8ADNT

Jay Pestrichelli's book Buy and Hedge https://amzn.to/3jQYgMt

Derek's book on public speaking Effortless Public Speaking https://amzn.to/3hL1Mag

Contact Derek [email protected]

Derek Moore looks at how companies in the S&P 500 are not correlated while the equal weighted S&P 500 is correlated closely with the weighted S&P 500 Index. Later, looking at historical rolling 10-year returns in the market and why it's rare to have periods that are negative over longer time frames. Plus, touching on single stock risk a la Elon Musk, Tesla, and Trump public news hurts Tesla shares. Oh, and we are only 2.4% below the old all-time high.

S&P 500 Index now only 2.4% from a new all-time high

Market Breadth definition and how its narrowing currently

Mag 7 performance dispersion

Elon vs Trump

Rolling 10-year returns in the S&P 500 Index

Single stock risk vs diversified indexes

Mentioned in this Episode

ZEGA Concentrated stock and white paper on Concentrated Stock Hedging https://zegainvestments.com/products/concentrated-stock

Derek Moore's book Broken Pie Chart https://amzn.to/3S8ADNT

Jay Pestrichelli's book Buy and Hedge https://amzn.to/3jQYgMt

Derek's book on public speaking Effortless Public Speaking https://amzn.to/3hL1Mag

Contact Derek [email protected]

Derek Moore explains how what sometimes seems obvious isn't what happens as we can see with inflation numbers that continue to move lower despite consumer sentiment surveys expecting 6.6% inflation in the next year. Plus, NVDA had its earnings and the stock' forward PE is lower due to the next 12-month analyst estimates being near all-time highs. Plus, sell in May would have been a mistake as markets recovered and are now back to within several percent of all-time highs.

PCE Inflation vs CPI Inflation

NVDA forward PE ratio and earnings EPS estimates

Calendar Spreads vs Diagonal spreads explained

Inflation continues to be lower

University of Michigan consumer sentiment survey says 1-year inflation 6.6%

Atlanta FED GDP Now

EconPi

Mentioned in this Episode

Derek Moore's book Broken Pie Chart https://amzn.to/3S8ADNT

Jay Pestrichelli's book Buy and Hedge https://amzn.to/3jQYgMt

Derek's book on public speaking Effortless Public Speaking https://amzn.to/3hL1Mag

Contact Derek [email protected]

Derek Moore talks about seeing stories of exploding 30-year yields but what if they are low compared to historical relationships between the fed funds rate? Then, looking at how correlated the 60/40 portfolio has been over the last 5 years begging the question, did it do anything for investors? Later, looking at NVidia implied volatility ahead of its big earnings release this week to see what the options market is pricing in for a potential one standard deviation move? All this and more this week.

S&P 500 Index net profit margins expected next 12 months

The US Dollar index breaks below its trendline

Nvidia earnings and the options market

Forecasting expected 1-standard deviation moves using implied volatility

Correlations between the S&P 500 Index and the 60/40 portfolio last 5 years

Historical average of the spread between the 30 Year Treasury and the Fed Funds Rate

Should the 30-year treasury yield be higher?

Japan bond yields normalize reaching highest levels going back to 2007

Mentioned in this Episode

Derek Moore's book Broken Pie Chart https://amzn.to/3S8ADNT

Jay Pestrichelli's book Buy and Hedge https://amzn.to/3jQYgMt

Derek's book on public speaking Effortless Public Speaking https://amzn.to/3hL1Mag

Contact Derek [email protected]

Derek Moore reflects on market reaction to the 2011 US debt downgrade and explains what S&P, Fitch, and Moody's have for ratings. Plus, are markets poised for more positive returns based on several indicators? The bear case against the markets would be a reduction in profit margins. Later, Derek reviews some data of future 12-month returns when consumer confidence is low as a contrarian indicator. Finally, looking at several current indicators and random musing in markets for clues about the future. All that and more this week.

S&P 500 Index net profit margins for Q1 2025

Consumer confidence and consumer sentiment are low but is that a good thing?

Looking at how often intra year lows on average are -14% but often markets end higher

12-month inflation expectations are now 7.3% highest since 1981

Hard vs soft data

Velocity of M2 Money Stock

What has been working asset class wise in 2025 YTD

15 biggest rallies since 1950 and subsequent forward total returns

Atlanta Fed GDP Now

Investment banks starting to reduce recession probabilities

Attribution of earnings EPS growth

DeGraaf and Zweig Breadth Thrusts occurring within 1 month of each other

Explaining the difference between Moodys, Fitch, and S&P bond ratings

Moodys downgrades US Debt

Mentioned in this Episode

Derek Moore's book Broken Pie Chart https://amzn.to/3S8ADNT

Jay Pestrichelli's book Buy and Hedge https://amzn.to/3jQYgMt

Derek's book on public speaking Effortless Public Speaking https://amzn.to/3hL1Mag

Contact Derek [email protected]