Latest / Financial Survival Network / Markets Brace for September Shift - Dale Smothers - #6295

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Markets Brace for September Shift - Dale Smothers - #6295 · Financial Survival Network

• 0:00
  Speaker 1: I think we're seeing all time highs in the s
• 0:01
  Speaker 1: and P five hundred set and until these two things happen,
• 0:05
  Speaker 1: I think we're going to bounce around between that six
• 0:07
  Speaker 1: thousand maybe sixty one hundred restraint and that's in that
• 0:11
  Speaker 1: fifty seven to fifty eight hundred support. We're just going
• 0:14
  Speaker 1: to see it continue to set real idle until things
• 0:18
  Speaker 1: become clear. And one last thing I'll add next month,
• 0:22
  Speaker 1: perhaps we're still talking about the FED did nothing, but
• 0:25
  Speaker 1: we are hoping that in September we see a rate cut.
• 0:27
  Speaker 2: You are listening to Carrie Let'sa's Financial Survival Network where
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• 0:35
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• 0:48
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• 0:55
  Speaker 3: And welcome. You are listening to and watching the Financial
• 0:58
  Speaker 3: Survival Network of your host. Carry lets Dale's father is
• 1:01
  Speaker 3: with us now. We're talking about the interest rates, we're
• 1:06
  Speaker 3: talking about well, the economy, dah. It's great to have
• 1:10
  Speaker 3: you back on. So what are you making of How's
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  Speaker 3: latest inaction? Is he putting off cutting rates as long
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  Speaker 3: as he possibly can. What do you make of it?
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  Speaker 1: Yeah, ye, I mean he's definitely the delaying it as
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  Speaker 1: long as he possibly can. You're exactly right. I mean,
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  Speaker 1: at this point in time, we probably should have already
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  Speaker 1: had a rate cut based off of the data, looking
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  Speaker 1: at what we're looking at now with the war, with
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  Speaker 1: the trade deals that are still not settled. We've got July.
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  Speaker 1: Now we've got an August deadline that's coming up with
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  Speaker 1: the EU and China. This type of uncertainty is probably
• 1:46
  Speaker 1: going to force him to hold his hand even again
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  Speaker 1: in July, and then we've got I would say, a
• 1:52
  Speaker 1: September expectation of rate cuts. I saw today, Carrier. I
• 1:56
  Speaker 1: think it was maybe ninety five percent chance of no
• 2:01
  Speaker 1: action again in July, is what the markets price the
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  Speaker 1: me in right now. So at this point they're just
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  Speaker 1: hanging tight.
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  Speaker 3: Really, you think that's so? You think that's the way
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  Speaker 3: it's going to be.
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  Speaker 1: I would love to see one before the end of summer.
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  Speaker 1: Up until the war broke out. Literally, I was putting
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  Speaker 1: out some publications right on the eleventh of June saying
• 2:22
  Speaker 1: I expect a rate cut not this time, but in July.
• 2:26
  Speaker 1: I expect a rate cut before the end of summer,
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  Speaker 1: and then I expect a rate cut, the second rate
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  Speaker 1: cut for twenty twenty five in the fall. And to
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  Speaker 1: be real frank with you, I don't know that the
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  Speaker 1: one in summers is going to happen, simply because of
• 2:37
  Speaker 1: the timidness of what we've seen with the FED, the
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  Speaker 1: war's uncertainty, the rate cuts probably aren't going to come
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  Speaker 1: until we had some sort of certainty around EU because
• 2:48
  Speaker 1: they're afraid of tariffs affecting inflation. And I think it's
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  Speaker 1: already proof is in the pudding, if you will, that
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  Speaker 1: tariffs haven't made an inflation impact like we expected. And
• 3:01
  Speaker 1: quite frankly, I'm not surprised. Tariffs are a demand destroyer.
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  Speaker 1: We talked about this the last time we were together.
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  Speaker 1: The demand destroyer of tariffs CAUs prices to stay pretty stagnant,
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  Speaker 1: and just like we saw in twenty seventeen.
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  Speaker 3: Yeah, yeah, really, according to some number, I think maybe
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  Speaker 3: the Treasury Secretary mentioned it that one of the last
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  Speaker 3: time Trump imposed tariffs, the Chinese and the other countries
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  Speaker 3: involved basically just eight two thirds of them and passed
• 3:38
  Speaker 3: along a third.
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  Speaker 1: Sure, and I saw a statistic the other day that
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  Speaker 1: was talking about the already the result of the Chinese
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  Speaker 1: negotiations to this point is that and I might be
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  Speaker 1: wrong on these numbers, so we might want to fact
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  Speaker 1: check this maybe in the details, but twenty percent tariff
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  Speaker 1: theoretically was going against American goods when we sent it
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  Speaker 1: to them, they were tariffing our goods at twenty percent.
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  Speaker 1: Now they're tariffed at ten, So we got a ten
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  Speaker 1: percent positive swing there. And then we were tariffing their
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  Speaker 1: goods at only twenty and now we're tariffing at thirty
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  Speaker 1: And that's just during the negotiation time. We have a
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  Speaker 1: twenty percent swing to our favor, and that's just without
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  Speaker 1: the finalization of the actual deal. So theoretically, as long
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  Speaker 1: as China upholds their end of the bargain, once all
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  Speaker 1: of this is settled, I think you've got stocks like
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  Speaker 1: Apple that haven't really seen the takeoff that the other
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  Speaker 1: mag seven have that we'll start to see a catch
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  Speaker 1: up trade simply for the open business sign that will
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  Speaker 1: be posted in China.
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  Speaker 3: So all right, well, so what's your thoughts? Where are
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  Speaker 3: we heading here?
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  Speaker 1: Yeah, you know, I've expected at least until again, everything
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  Speaker 1: with the missiles. When missiles started landing in a run,
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  Speaker 1: a lot of our market expectations had to be rejostled,
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  Speaker 1: just to tad, But I still expect a sixty one
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  Speaker 1: hundred s and p five hundred, and I think it
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  Speaker 1: will bounce between that sixty one hundred restraint and a
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  Speaker 1: fifty seven hundred probably resistance or support. Rather, we've got
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  Speaker 1: a we've got a pretty strong support, I think at
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  Speaker 1: that fifty seven hundred points, even if America gets involved.
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  Speaker 1: You know, there is one rosy picture that America gets involved.
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  Speaker 1: We send a bunker buster, and you know, we've got
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  Speaker 1: a we've got one plane that's theoretically exposed for a
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  Speaker 1: very short period of time, and we neutralize Iran's capability
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  Speaker 1: of ever getting back into this nuclear war. Now, if
• 5:31
  Speaker 1: that's the case, I think that's going to be a
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  Speaker 1: tailwind for the market. The variable of Iran has been
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  Speaker 1: a variable for at least twenty years, and to be
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  Speaker 1: real frank with you, I think we've had this same
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  Speaker 1: repeat of history over the last four decades in the
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  Speaker 1: Middle East. My hope and my true conviction is that
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  Speaker 1: Donald Trump, at least at this point, he has handled
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  Speaker 1: it as well as you could expect. There's not been
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  Speaker 1: this knee jerk reaction carry which we've become accustomed to
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  Speaker 1: first and ask for details later. That's not been the
• 6:02
  Speaker 1: way he's handled this. He's been very firm, very strong
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  Speaker 1: with his words and pointed saying Iran will not have
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  Speaker 1: a nuclear weapon, and if America has to get involved
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  Speaker 1: and we can end that threat, then so be it.
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  Speaker 1: Long story short, I believe that as long as America
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  Speaker 1: handles this tactfully and we aren't out there pressing for
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  Speaker 1: a regime change, we should be able to break the
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  Speaker 1: cycle of history that we've seen in the Middle East
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  Speaker 1: again the last forty years.
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  Speaker 3: Well, let's hope that that's the case. And I think
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  Speaker 3: we're a little more involved in it than the President
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  Speaker 3: is indicating, And I think there's been a lot more
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  Speaker 3: support aerial refueling, all these things. They sent two hundred
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  Speaker 3: planes over to Iran and they don't really have that
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  Speaker 3: extensive aerial refueling capability like the US has. So I
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  Speaker 3: think the United States a lot more involved in this already.
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  Speaker 3: So to think that we're backing out of at this point,
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  Speaker 3: I think we're just waiting to see if the government
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  Speaker 3: of Irana is going to collapse or not.
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  Speaker 1: You've got a good point there, and hopefully again, you know,
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  Speaker 1: a lot of this we would maybe leave in the
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  Speaker 1: hand of the creator. We just pray that nothing fills
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  Speaker 1: that vacuum like it did in say Libya, or Afghanistan
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  Speaker 1: or Iraq. This type of thought. Though, what you just
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  Speaker 1: said about America already being involved, I'm right there with you.
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  Speaker 1: I think we are theoretically already involved. Iran knows that
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  Speaker 1: as well. Israel is as good as they are, Israel
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  Speaker 1: could not have survived the barrage of nuclear missiles that
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  Speaker 1: excuse me, of missiles in general over Tel Aviv had
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  Speaker 1: it not been for America's involvement over the last couple
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  Speaker 1: of decades. The Iron Dome itself is direct American involvement.
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  Speaker 1: And if you think through America getting directly if you
• 7:52
  Speaker 1: will directly involved, I do hope that it is simply
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  Speaker 1: by using some of our own munition in the attack
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  Speaker 1: rather than boots on the ground in Iran.
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  Speaker 3: Yeah, well, I guess we're gonna find out. But you know,
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  Speaker 3: the markets were a little rattled by it at first,
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  Speaker 3: but they seem to have the kind of found stability, right.
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  Speaker 1: Yeah, all as well, I mean, you know, if I
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  Speaker 1: were a town crier, I would be saying, it's it's
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  Speaker 1: seven days into the war and all is well. There's
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  Speaker 1: no real there's no real breakage on any front that
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  Speaker 1: we look at. Even the jobless claims that came back
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  Speaker 1: seem and clearly this is like driving the car in
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  Speaker 1: the rearview mirror. We've talked about it, but the jobless claims,
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  Speaker 1: the consumer sentiment reports that we're seeing say that most
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  Speaker 1: Americans are satisfied. They're they're they're they're keeping their jobs,
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  Speaker 1: their sentiment, their their thoughts around the market are positive
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  Speaker 1: as a whole. This is looking good. And you know
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  Speaker 1: what's also a key indicator of how America will react
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  Speaker 1: is do we see a flood into security like for instance,
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  Speaker 1: T bills or treasury notes. This type of hasn't really
• 9:00
  Speaker 1: taken place. We also haven't seen oil get to one
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  Speaker 1: hundred dollars a barrel like we would traditionally have expected
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  Speaker 1: in this type of a breakout in the middle least.
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  Speaker 1: So all again, all is well.
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  Speaker 3: All right, So when we have this discussion next month,
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  Speaker 3: where are we going to be?
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  Speaker 1: Uh? You know, I think that honestly, when this all happened, Carrie.
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  Speaker 1: My initial reaction the day of and even that weekend
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  Speaker 1: last weekend, it was Father's Day weekend, and I'm thinking, hey,
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  Speaker 1: you know by Monday, this will be a non story. Well,
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  Speaker 1: just like you said, we've been a little bit more
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  Speaker 1: involved than maybe they were leading on. And I do
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  Speaker 1: think that American involvement becomes a point unless unless Iron
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  Speaker 1: turns over and says, hey, complete surrender. And Donald Trump
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  Speaker 1: has made that very clear. It's either complete surrender or
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  Speaker 1: we're coming to get you. If America is involved, or
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  Speaker 1: if America is not involved. I think a month from
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  Speaker 1: now this is not the story that we're focused on.
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  Speaker 1: Let's see a month from now. Theoretically, we're hoping that
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  Speaker 1: European Union trade deals behind us and that we have
• 10:01
  Speaker 1: a very clear decisive path forward for a trade deal
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  Speaker 1: being completed in China. Again, if these two things happen,
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  Speaker 1: I think we're seeing all time highs in the s
• 10:11
  Speaker 1: and P five hundred set. And until these two things happen,
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  Speaker 1: I think we're going to bounce around between that six thousand,
• 10:18
  Speaker 1: maybe sixty one hundred restraint and that's in that fifty
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  Speaker 1: seven fifty eight hundred support. We're just going to see
• 10:24
  Speaker 1: it continue to set a real idle until things become clear.
• 10:30
  Speaker 1: And one last thing I'll add next month, perhaps we're
• 10:32
  Speaker 1: still talking about the Fed did nothing, but we are
• 10:35
  Speaker 1: hoping that in September we see a rate cut and
• 10:38
  Speaker 1: that will again act as a tailwind for the market.
• 10:41
  Speaker 3: All right, Well from your mouth, Dale, Great to have
• 10:45
  Speaker 3: you back on the show. Just tell us where going
• 10:48
  Speaker 3: to find you yet?
• 10:49
  Speaker 1: Yeah, so you can navigate to our website urdswealth dot
• 10:51
  Speaker 1: com rdswealth dot com. While you're there, subscribe to our
• 10:55
  Speaker 1: newsletter that we send out on a weekly basis, Market commentary,
• 10:58
  Speaker 1: a little bit of weekend Rea for those who are
• 11:01
  Speaker 1: in or close to retirement. Ways to live happy in retirement,
• 11:04
  Speaker 1: spending more time with the people you care about, less
• 11:07
  Speaker 1: time worrying about the market.
• 11:08
  Speaker 3: Great. Hey, if you got any questions for Dale myself
• 11:11
  Speaker 3: shooting email kl at Carrie lets dot com. You'll find
• 11:14
  Speaker 3: a link to Dale's site and the show that's this
• 11:16
  Speaker 3: interview on Financial Survival Network dot com. When you go there,
• 11:20
  Speaker 3: we just ask you sign up for our free newsletter. Dale.
• 11:23
  Speaker 3: Been a pleasure, Thanks for stopping by. We'll talk to
• 11:25
  Speaker 3: you soon.
• 11:26
  Speaker 1: Always a pleasure to seek Kerry.
• 11:27
  Speaker 2: Thanks for listening to Carrie Letz's Financial Survival Network, your
• 11:32
  Speaker 2: solution to today's trying times. For the latest, go to
• 11:36
  Speaker 2: Financial Survivalnetwork dot com. Financial Survival Network now more than ever,