Latest / Financial Survival Network / Confidence Surge… But Trouble Ahead - Jay Mehta #6388

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Confidence Surge… But Trouble Ahead - Jay Mehta #6388 · Financial Survival Network

• 0:00
  Speaker 1: You know, we're still hanging out around COVID level lows,
• 0:03
  Speaker 1: and yet this number is the highest number of twenty
• 0:05
  Speaker 1: twenty six. So I think that's an interesting and interesting
• 0:09
  Speaker 1: look at what this index is telling us.
• 0:11
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• 0:15
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• 0:32
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• 0:38
  Speaker 3: And welcome. You are listening to and watching the Financial
• 0:43
  Speaker 3: Survival Network. I'm your host, Carrie Let's. Well, we got
• 0:46
  Speaker 3: some bang up numbers on consumer confidence. This one almost
• 0:52
  Speaker 3: feels like it's real. Jay Meta is with us now,
• 0:57
  Speaker 3: and Jay, we still find you at Vera's Advisors dot com.
• 1:03
  Speaker 3: So tell us tell us what you think of these numbers.
• 1:06
  Speaker 3: The markets liking them, aren't there, isn't it?
• 1:09
  Speaker 1: Yeah? Well, you know, here's the thing. I think these
• 1:11
  Speaker 1: numbers came in surprisingly high, but that shouldn't be a surprise.
• 1:14
  Speaker 1: We've kind of seen these numbers come in higher than
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  Speaker 1: the estimate since mid last year, all but two months.
• 1:22
  Speaker 1: So the fact that it's high higher than the estimate
• 1:25
  Speaker 1: may not be a surprise. The fact that is as
• 1:26
  Speaker 1: high as it is, you know, we're still hanging out
• 1:29
  Speaker 1: around COVID level lows, and yet this number is the
• 1:32
  Speaker 1: highest number of twenty twenty six. So I think that's
• 1:35
  Speaker 1: an interesting, uh and interesting look at what this index
• 1:38
  Speaker 1: is telling us.
• 1:39
  Speaker 3: Yeah, so what do you think it is really telling
• 1:41
  Speaker 3: us that that it's not the end of the world
• 1:44
  Speaker 3: or that I mean, what do we really know from this?
• 1:49
  Speaker 1: You know, I'm not sure that we know anything, But
• 1:51
  Speaker 1: I think that what I would say is that at
• 1:53
  Speaker 1: the household level, people are still feeling resilient. Consumption may
• 1:58
  Speaker 1: stay higher, at least for the next month or so,
• 2:00
  Speaker 1: and you know, kind of tentative about what's happening heron.
• 2:03
  Speaker 1: But with the ceasefire, it seems that sentiment remains high,
• 2:08
  Speaker 1: consumption may stay high. I think that where you're going
• 2:12
  Speaker 1: to feel this pinched the most with the higher energy
• 2:15
  Speaker 1: costs is we're going to have those lower income households
• 2:17
  Speaker 1: kind of feeling a little bit more just discretionary spending
• 2:22
  Speaker 1: and the energy costs being a larger percentage of their
• 2:25
  Speaker 1: overall income. That's where you're going to see a larger pinch.
• 2:28
  Speaker 1: But by and large, I think confidence is high. You know,
• 2:31
  Speaker 1: what this number really is measuring is, you know, what
• 2:35
  Speaker 1: do people think about the job markets? And so while
• 2:37
  Speaker 1: that's high and people are tentative about inflation, I think
• 2:40
  Speaker 1: I think consumption will.
• 2:41
  Speaker 3: Stay up all right, So so you think it keeps going.
• 2:46
  Speaker 3: And the what do you think about energy prices? Obviously
• 2:50
  Speaker 3: they didn't impact they didn't have a negative impact on
• 2:55
  Speaker 3: the confidence numbers. So people are seeing this energy price
• 2:59
  Speaker 3: bump as a low just a short duration event, and
• 3:04
  Speaker 3: they expect the energy prices to go back down.
• 3:07
  Speaker 1: Well, I'm not sure if they're expecting them come down
• 3:10
  Speaker 1: anytime soon. What we can say is that right now,
• 3:12
  Speaker 1: maybe with the ceasefire and kind of what's going on
• 3:16
  Speaker 1: in Iran, it just hasn't soured the sentiment that you
• 3:20
  Speaker 1: might think it would have. But what we saw over
• 3:23
  Speaker 1: April with the ceasefires is that consumer sentiment remains relatively high.
• 3:27
  Speaker 1: It's actually an uptick. As I said before, it's highest
• 3:30
  Speaker 1: we've seen throughout the year or so. I think that,
• 3:33
  Speaker 1: you know, it's hard to rely on these government numbers
• 3:36
  Speaker 1: too much, but you know, This is kind of looking
• 3:38
  Speaker 1: out the windshield rather than looking out the rear view.
• 3:41
  Speaker 1: And we're going to get when when we know whether
• 3:44
  Speaker 1: or not this is right or wrong, it's looking out
• 3:46
  Speaker 1: the rearview, and by that time, you know, we're just confirmatory.
• 3:49
  Speaker 1: But right now it feels, it feels pretty good. I
• 3:51
  Speaker 1: think that consumers are not afraid to keep spending.
• 3:55
  Speaker 3: Yeah, so that was a shocker. What other numbers you
• 3:58
  Speaker 3: think coming out are going to be shockers?
• 4:01
  Speaker 1: No, it's hard to say, not not being an economist.
• 4:04
  Speaker 1: I you know, what I really try to have households
• 4:06
  Speaker 1: focus on is the long term planning and when especially
• 4:09
  Speaker 1: with consumer confidence, this is kind of a short term
• 4:12
  Speaker 1: outlook more, you know, on the business focus. What does
• 4:15
  Speaker 1: this what does this have to do with near term spending?
• 4:18
  Speaker 1: I think that when we look at kind of the
• 4:20
  Speaker 1: University Michigan report, we look more long term economic outlook.
• 4:24
  Speaker 1: We're looking at inflation how that affects personal finance. But
• 4:28
  Speaker 1: this report today, this report today, absolutely absolutely I think
• 4:35
  Speaker 1: is giving us a surprise again to the upside, and
• 4:37
  Speaker 1: it's it's given some confidence.
• 4:41
  Speaker 3: Yeah, so what do you think of inflation that? What
• 4:43
  Speaker 3: are those you know, the confidence boost could be quickly
• 4:47
  Speaker 3: erased by higher than expected inflation numbers.
• 4:52
  Speaker 1: Right, Oh yeah, I mean absolutely, And I think that
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  Speaker 1: that's one of the things we really need to keep
• 4:57
  Speaker 1: our eyes on, is where does inflation go from here?
• 5:00
  Speaker 1: As we have prolonged or excess inflation, then we're going
• 5:03
  Speaker 1: to start to see that creep up into middle income
• 5:05
  Speaker 1: households as well, and then that's going to tell a
• 5:07
  Speaker 1: different story. But for right now, I mean, I'm urging
• 5:11
  Speaker 1: households to kind of keep their eye on the long
• 5:13
  Speaker 1: term economic outlook. We know that these kinds of shocks,
• 5:17
  Speaker 1: whether it's Iran or the tariffs or you know, COVID
• 5:21
  Speaker 1: and before that the Great Financial Crisis, every five to
• 5:23
  Speaker 1: ten years we've got something major going on. We don't
• 5:26
  Speaker 1: exactly know what it's going to be or how long
• 5:28
  Speaker 1: it's going to affect us. But this is this is
• 5:31
  Speaker 1: a not surprising surprise that we're dealing with Iran when
• 5:34
  Speaker 1: we are.
• 5:34
  Speaker 3: So so, how does this affect your investment outlook? And
• 5:40
  Speaker 3: where do you put your money? I mean, you think
• 5:42
  Speaker 3: the AI boom is just going to keep going and
• 5:45
  Speaker 3: going and with you know, never looking back.
• 5:49
  Speaker 1: You know, it's funny that you asked that because if
• 5:52
  Speaker 1: you would have asked me a year ago about AI said, well,
• 5:54
  Speaker 1: it's got to slow down eventually, and then you ask me, now,
• 5:56
  Speaker 1: I'm going to say it's got to slow down eventually.
• 5:58
  Speaker 1: But you know, these boom just keep on going long
• 6:01
  Speaker 1: and expected. I think that's kind of the definition of
• 6:03
  Speaker 1: a boom. But I think that it's good to you know,
• 6:06
  Speaker 1: we shouldn't be chasing the highs. I think when it
• 6:09
  Speaker 1: comes to planning, you want to have a long term view,
• 6:11
  Speaker 1: a highly diversified portfolio in the right areas. You know,
• 6:15
  Speaker 1: metals have acted kind of like a risk on asset
• 6:18
  Speaker 1: over the course of the year. More recently a little bit,
• 6:23
  Speaker 1: you know, it's started to get in defense again. But
• 6:24
  Speaker 1: I think that I think by and large, you want
• 6:27
  Speaker 1: to take a long term view of what are you
• 6:29
  Speaker 1: trying to achieve on a risk adjusted basis, build a
• 6:32
  Speaker 1: plan around that, knowing that these shocks are going to happen,
• 6:35
  Speaker 1: and not to react to the shocks, but sometimes be
• 6:38
  Speaker 1: opportunistic around them. So with energy consistently being high, I
• 6:43
  Speaker 1: think there's a few sectors to watch out, energy still
• 6:45
  Speaker 1: being one of them, but that's also an indicator a sector,
• 6:49
  Speaker 1: So we keep our eye on that and see when
• 6:51
  Speaker 1: there might be a turn. But I think you know,
• 6:54
  Speaker 1: at long term planning, it's really about having that healthy,
• 6:56
  Speaker 1: diversified portfolio from the beginning and not being reactive alreright.
• 7:00
  Speaker 3: Okay, well that's interesting, interesting numbers. We will see how
• 7:04
  Speaker 3: they pan out in the coming months ahead. Just tell
• 7:07
  Speaker 3: us again where we find you, how we connect with
• 7:09
  Speaker 3: you on the web.
• 7:10
  Speaker 1: Check so the best place to find us is Verazadvisor
• 7:13
  Speaker 1: dot com. That's v e r a Z or you
• 7:17
  Speaker 1: can just google us Vera's Advisors and we're located in
• 7:19
  Speaker 1: California here on the West coast.
• 7:21
  Speaker 3: All right, excellent and links in the show notes to
• 7:23
  Speaker 3: this interview on Financial Survival Network dot com. Questions comments
• 7:27
  Speaker 3: for Jay myself, shoot me an email Klatcarrie LUTs dot com. Jay,
• 7:32
  Speaker 3: we'll talk to you again soon. Thanks for stopping by,
• 7:34
  Speaker 3: Thanks for having me on, Thanks.
• 7:36
  Speaker 2: For listening to Carrie Letz's Financial Survival Network. Your solution
• 7:40
  Speaker 2: to today's trying times. For the latest, go to Financial
• 7:44
  Speaker 2: Survivalnetwork dot com. Financial Survival Network now more than ever,