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The AI Normalization Playbook · The SPY Trader

• 0:00
  Hello everyone and welcome back to the Spy Trader podcast !
• 0:04
  I am your host , Penny Profit , and I am so glad you could join me this afternoon .
• 0:10
  It is 2:30 pm on Monday , June 22nd , 2026 , and things are looking quite interesting on the trading floor here on the West Coast .
• 0:20
  We are currently navigating what many are calling a normalization phase .
• 0:25
  After those hypergrowth years of the early AI boom , investors are now moving away from pure speculation and focusing on who is actually making money , especially as we head into the 2026 Midterm Election cycle .
• 0:39
  Let's dive into the big news items .
• 0:42
  The Federal Reserve has kept the federal funds rate at 4.25 to 4.50 percent for the third meeting in a row .
• 0:51
  Inflation is proving to be a bit sticky around 2.8 percent , which is keeping the iShares Core U.S.
• 0:57
  Aggregate Bond ETF , or AGG , trading in a very tight range .
• 1:03
  Meanwhile , the broader market is still showing some muscle , with the Vanguard Total Stock Market ETF up over six percent so far this year .
• 1:12
  In the world of tech , the hype is turning into a search for a return on investment .
• 1:18
  Nvidia recently reported that they are shifting focus from just selling hardware to AIasaService software subscriptions .
• 1:26
  Apple is also seeing a big boost from their SiriGPT integrated devices .
• 1:30
  But the real star lately has been healthcare .
• 1:33
  The Health Care Select Sector SPDR Fund , or XLV , is actually outperforming the S&P 500 .
• 1:41
  This is thanks to companies like Eli Lilly and Novo Nordisk , which just announced successful trials for weightloss pills .
• 1:49
  This is a game changer for manufacturing costs and is really lifting the whole sector .
• 1:55
  On the flip side , real estate is still feeling the pressure of high debt costs , leaving the Vanguard Real Estate ETF , or VNQ , essentially flat for the year .
• 2:06
  However , gold is shining bright .
• 2:08
  SPDR Gold Shares reached nearalltime highs last week as people look for safety amidst geopolitical tensions and central bank shifts .
• 2:17
  Looking at specific companies , Tesla's Robotaxi fleet launched in three more cities last month , which is causing some swings in the Vanguard S&P 500 ETF .
• 2:29
  And over at JPMorgan Chase , they are reporting healthy margins despite a bit of a slowdown in loan demand .
• 2:36
  So , what should you be doing with your money right now ?
• 2:40
  My first recommendation is to stick with a Core and Explore strategy .
• 2:44
  Keep about 60 percent of your equity in the Vanguard S&P 500 ETF , known as VOO .
• 2:52
  Largecap companies have the balance sheets to handle these 4.5 percent interest rates .
• 2:57
  Second , I suggest a tactical overweight in Healthcare .
• 3:01
  Putting about 10 percent into the XLV fund gives you a great mix of a defensive safety net and highgrowth potential from new medicines .
• 3:10
  Third , it might be time to look abroad .
• 3:13
  I recommend increasing your exposure to the Vanguard FTSE Developed Markets ETF , or VEA .
• 3:21
  U.S.
• 3:21
  tech is getting expensive , and you can find much better valuations and higher dividends in European and Japanese equities right now .
• 3:30
  Finally , keep a little bit of a defensive buffer .
• 3:34
  Holding 5 percent in SPDR Gold Shares , or GLD , is a smart hedge against election year volatility , and 5 percent in the Vanguard Total Bond Market ETF provides a nice yield of nearly 5 percent .
• 3:48
  Overall , we are cautiously optimistic .
• 3:52
  The easy money from the AI surge has been made , but the underlying economy is still robust .
• 3:58
  Focus on quality earnings as we move into the second half of 2026 .
• 4:04
  Thanks for listening to Spy Trader , and I'll see you at the next closing bell !