Hello folks, welcome to the end of the year and the sense of things. This is

our annual review of what we talked about at the beginning of last year or at the end of last year, our

predictions. We will go over our predictions and how close we were or weren’t to those predictions and how we

feel for the upcoming year. So stay tuned. We’ll be right back on in just a

second. [Music]

[Applause] [Music] Hey everybody, welcome to the show. Ron,

how you doing my friend? Good morning. Winding down another year and you and I are coming up on three years. What are we going to do for our

big anniversary? I don’t know. I don’t know. Maybe we’ll we’ll celebrate Festivus together. Ha.

Oh, I already got my my cartoons ready to go on my phone to send out next week to everybody for festivist. Nice.

My favorite is the elf meme with Will Farrell wishing everybody a happy festivist. That’s one. That’s my

favorite. Will it be the airing of grievances? Actually, we get to do our airing of grievances today as we look at some of

the other doofuses in the industry that did stuff this year. Absolutely. All right, let’s get going

here. All right. So, I’m not going to read this to everybody, but here’s our disclosure. Obviously, these are

opinions only for entertainment purposes. I don’t know if I’ve ever seen any analyst ever get it right. The idea,

it’s like a grenade. You just want to be in the area, something like that. But, we had to put the disclosure in. So,

here we are. Hand grenades and horseshoes. That’s about it. So, 100%. So, let’s review the last couple

of years. I’ll let you talk about 2024 and then I’ll take over 2025 and we’ll

keep going. We were totally wrong in 2024. So, never never expected the market to

have as big of a run in 2024 as it did. Interestingly enough, I was pretty bare

or I was pretty bullish going into 2025. And it was interesting to say we’re

actually I came the closest within 20 some odd points right now. Now, we still

have a week and a half to go of market trading and anything could happen during

that time period. We could end up with my bullish case. We could end up with my

bearish case or Ron’s bullish and bearish cases. The way the market’s been

all over the fence here, but I I I think it’s been an intriguing couple of years

in the market. And as we go into looking

If you remember what Ron talked about a few weeks ago of the fact that we

typically don’t have four years in a row of up it’ll be interesting to see how

next year performs but a lot of things are looking good. What’s your thoughts, Ron? Yeah, going back to that one

thought because I’m putting it into my 2026 outlook that yeah, I’m sending out to clients next week and we’ve only had

four years in a row of double digit gains once or you could look at it twice in

the last 75 years and that was from 95 to 99. Okay, that’s it.

That’s it. Yeah, actually last year in I’m sorry. Yeah, 2024 I was bearish

along with the majority of the other market strategists figuring we had better than 50% of a recession and we

didn’t get it. And this year my my I was really looking good for my bare case in

April and then we got spring coiled to the upside with the delay in tariffs. And look, we both know that there’s an

air pocket under this market. We just don’t know how much. But we’ll talk about next year in a minute. But yeah, I

think we’ll be pretty strong. We may get close to your bullish case by the end of this month. We’ll have to see. We had a

low CPI number today. Yeah. Yeah. And it looks like markets are markets like that. Dow’s up 1.13%

right now. 4% on or NASDAQ’s up 1.13%. So, it’s off to the races again. So,

and a lot of people don’t realize the last week was a lot of tax harvesting, profit taking, mutual funds and fund

managers locking in profits for the year so they could get their quarterly numbers to look good. So, what was

selling off? All the tech and the AI, all the good stuff. That’s what was selling off because that’s where they had the majority of

their profits. Sure. So, yes, there you’re going to see money flow in for the Santa Claus rally. Okay.

and and mutual funds this year. I had one of my friends who’s a he’s a chiropractor calls me and he says, “What

the heck happened to my mutual fund?” He goes, “Like $4,000.” It ended up like

$4,000 in capital gains. So that tells you how much I mean it was like 10% of

his portfolio came off in capital gains this year. Wow. As a result of that, which is just

absolutely insane. Yep. So these were the sectors we were looking at to consider and to avoid.

Look, I got three for three. I the last one I said was watch consumer discretionary, which was one of your

positives. I just wasn’t sure about the consumer this year, but biotech one had one hell

of a run in the last six months. I think that’s going to continue. We’ll talk about that in a little bit.

Defense went crazy in the last six, seven months. Materials were pretty good, too, with all the manufacturing

coming back. And on the sectors to avoid, this is my theme going into the next year too, which we’ll talk about,

oil. They’re going to keep oil prices depressed. And as long as mortgage rates stay high, I don’t know why you would go

into a lot of the mortgage. I know the new some of the new home builders are doing well. And the financials actually

started to make a comeback in the last couple of months. And then they got smacked at the end of

especially like fintech and stuff like that got smacked right at the end of November. So, I don’t think they’re out

of the clear yet by any means. I agree. And how about you this year?

You did all right. Yeah, healthcare. I I think healthcare and biotech we both agreed at that time.

I really felt tech was going to do well and it’s been a just up until a few weeks ago or about since the beginning

of November after the shutdown ended and we ended up with year-end uh year-end

portfolio dressing going on in a lot of these big mutual funds and stuff like that. I I wasn’t sure on the consumer. I

thought with the credit card rates as high as they are and the amount of credit, I just didn’t figure consumer

discretionary would still have a run, but people keep spending money. I don’t know how and why and what that they do

it. I also said avoid utilities. They’ve had actually a pretty dang decent year.

So, and then Staples, I just felt like that wasn’t going to do good and they have

sucked up big time. So I I was right on the money with that. Yeah, Clorox is at a I think a 10 or 11

year low. Yeah, the chart looks terrible. A lot of these

Yeah. A lot of these kind of household name companies have just been absolutely awful over the last year.

And if you bought in at the height of COVID, you’re crying a pool of water right now for if you were in a lot of

these consumer staples. Yeah. when you have a growthbased market run, I mean, the money’s got to go

someplace, and unfortunately, it ain’t going to go into those guys. So, they you you at least get paid a little bit

of a dividend, but that doesn’t offset a 30% drop in the stock, unfortunately. No. All right, let’s poke fun of all the

people that are making tens of millions of dollars to not even be in the same zip code, let alone area code. So, we’ll

deal with the ones on the left first. forget about the 2026 price targets, but let’s look and see where some of these

super super smart people were in the beginning, actually a year ago now. They

were making their predictions and then of course in in March, actually in April and May, they were reducing their price

targets and now look where it ended up. So I’ll let you take the first poke and

then I’ll go from there. I just my my favorite is the simple fact we give we

give ranges with our stuff of this is what we think our bullish case is. This is our base. This is our these guys. Oh,

this is a this is our target and then they just keep changing it throughout the year. Oppenheimer is my favorite

there. Went from 7100 to 5950. You were wrong on both sides of the spectrum.

What is it? Bank of America had they just not done anything. Bank of American, if you just stayed to

your guns, you’d actually be right now and you’d be looking pretty dang good. But yeah, even JP Morgan, RBC, all these

guys just, oh, okay, we this is where we think it is. Oh, no, it was bad in April and they just changed it and never went

back. Yeah. My my favorite part about this is there were a few that did stick to their guns. HSBC, they stuck to their guns.

Yep. Deutsche Bank, they stuck to their guns even they were in the high end. My favorite one was Wells Fargo because

they came up with a faka odd number and they never changed it and they look they

stuck by it. We’ll say, “Hey, we’ll see where things are. We’ll see how 7,07.”

Yeah, we’ll see how things pan out. I just think it’s Look, that’s why I do a range. I try and create a field goal

post and we’ll maybe the ball will get kicked in between somewhere in the middle. Yeah. Yeah. Yeah. Maybe. We’ll see. and we’ll

see where we are in a little bit when we put in our numbers. But let’s look to the let’s look to the to their 2026

target numbers. And the highest out there is Oenheimimer again at 8,100. I

know the market strategist is a good game. Yeah,

he talks a good game. He talks a good game. That’s a hell of a run up though. 8,100. That’s up in the

20% range from where we’re at today. Yeah. Yeah. But I look on the right side

though. These are some of the lesser known names. Yeah. SOA Bank 6375.

That’s like the bear. And I would even say Zachs at 6867

would almost be almost like a bare reading despite the fact we’re below there right now

compared to everybody else. Yeah. Everybody’s looking for anywhere between 12 to 20% upside

essentially. Yeah. Again, going back to history, second year uh ter second year in a

presidential term, midterms next year with all the uncertainty and trying to get four years in a row of double-digit

gains. These are all the headwinds, but you could probably come up with two to three times the amount of tailwinds with

taxes and everything else, reassuring and business investment that that would

help. I think these are pretty interesting. But then again, here’s the thing that Yeah. Here’s the

thing that scares the crap out of me is when everybody agrees one direction.

That scares the living crap out of me. Yeah. The thing is, have we ever seen, forget

about 50%, a third of market strategists say we’re going to be lower than where

we are next year than this year. Yeah. Yeah. No, they need money coming in. So if you

even strike even like an ounce of fear that hey we may be lower people may take

their money out people may not put more money in. Sure. So it’s a joke. Yeah. And nobody Yeah. Nobody will pay

attention like ne they’ll pay attention now at the beginning of the year with these accepting here’s what our

expectations are. But then when we change them during the middle of the year we’re not really going to publicize that a lot because we want to be able to

come in and go hey look how smart we were. I I also think a lot of the

reasons why they do a midyear change obviously they’re everybody’s data dependent and they’re looking at it. But

the other thing is too to get their face on TV clickbait for articles. Hey yes, you know what? We’re looking for higher.

We’re looking for lower. Listen to us. Yeah, it’s immensely frustrating. Stick to

your guns, people. Maybe you’ll have a little more credibility. We’ll see. All right. I said or do what we do where we

give ranges of here’s where we think it is and it probably is going to be somewhere in the middle of those.

Yep. All right. I’ll let you take the first stab for this year. Make your bull and bear case.

All right. So, my bull case for the year I and I I will say right now I would

expect the market to be probably closer to my bull case for the year and I hope

that it is. We’re going to have full effect of the tax policies happening

this year. Really, the only thing in place that happened with the with the one big beautiful bill was a lot of the

tax incentives for growth and building and stuff like that. It most of the the

stuff for employees didn’t really take place. It won’t take place until January. So, we’re rolling into the

beginning of the year with January 2nd. Basically, every time you get a paycheck, you’re going to end up getting

more money in your paycheck than you were making just a week earlier because the tables were adjusted. Second phase

of that is going to be when people start filing their taxes, refunds will probably be a little bit higher because

they were withholding more last year. So, a couple of those things. I think from the consumer standpoint,

everybody hopefully is going to feel a little bit more, hey, I’ve got more money to spend, which they’re going to spend it. and then say they don’t have

any money again. I think continued productivity improvement from artificial

intelligence is going to continue to do that and I think there is and I mean

it’s already in place but massive amounts of spending on construction and infrastructure info or biotech and

health I think unleashed by the government getting out of the way and

letting them get going. If the Republicans, when we get to the

election, if the Republicans lose the House but retain the Senate, that kind of neutralizes anything from the

Congress, which, you know, allows the president to to continue to do what he does with executive orders and

everything else. Very much similar to Teddy Roosevelt when he was in. Teddy Roosevelt basically had to you he the

whole time he was in for eight years he had a split Congress and he basically

had to just use executive orders to get a lot of things done and it’s very likely split Congress is almost always bullish

for the market. It’s bullish. Yeah. They don’t they don’t keep monkeying around and stuff which is good or they don’t keep

creating more problems which I’m okay with because it forces them to on the

important stuff. it forces them to have to agree on or negotiate at least. So my

bullish case is 7826 for next year. That represents a 15%

from whenever Ron and I came up with these numbers earlier in the week. I don’t know where it is today. My neutral

case is 7418 up 9%. I think that’s probably the likely scenario for next

year quite frankly. I think all those things that I talked about with the bullish case happen, but

I just have a feeling that the MAG 7 and this is once again this is my this is

Jeff’s opinion only. I think the MAG 7 start to lose a little bit of steam and

the Mag 7 are depending on which market the S&P 500 or the NASDAQ they’re almost

40% in some cases of the market. So if they lose steam higher on the NASDAQ.

Yeah. And if they lose steam, the market loses steam as a result of that. And I’m

not sure that the rest of the the S&P 500, the rest of the 493 stocks have

enough juice to kind of keep the market going at that point and offset that down, you know, that that headwind from

the MAG 7. What affects the Mag 7? There’s you’re already seeing it a little bit right now with the kind of

market stumbling over itself for the last month or so specifically in the Mag

7 area because there’s a lot of concern that these guys are spending a ton of money on updates for AI and all that and

are they going to get the productivity back, the return on investment because they’re not only putting cash into this,

they’re financing it with debt and everything else. So that I say could

have some issues. Once again, split Congress I don’t think is going to have much of a much of anything. It’ll make

it harder to get healthc care affordability going, which I think is the biggest problem in this country

right now. I think it’s the biggest thing affecting people more than anything. My bare case 6125 down 10% for

the year. that my case there is AI continues to affect white collar jobs,

not necessarily blue collar jobs, but white collar jobs. And if people are getting laid off, they’re not putting

money into their 401ks, which I think has been driving this market because a

lot of money goes into 401ks is going into passive investments that just keep

pumping a lot of these stocks up. And if we see some major layoffs and we see a

slowdown in contributions to 401ks, I could see it easily the market slowing

down, dropping, and the other side is mag seven profits and everything. If and

then the final thing on my bare case was if the Democrats win both houses of Congress, then it’s going to be two

years of non-stop investigations and the

whatever the Gez, my brain just completely shut off. Yeah, it’ll be bickering back and forth.

It just bickering back and forth. Nothing will get done, but then it’ll be basically the government will be

neutralized at that point. And impeachment, that’s what I was saying. It’ll be a non-stop cases for

impeachment like the last two years of the Trump presidency. That’s my take. What’s yours?

All right. So, this we’re similar on the bullish case. Well, you know, I’ll tell you why I didn’t put 8,000 on there because I

think if the market’s going to go up, it’s going to it’s going to really go up. Just because in the in my trading

days, there was always something called the law of large numbers. And look, right now, we couldn’t get to 7,000 this

year. We’ve almost punched the ceiling a couple of times. I think we may have

that same issue next year of not if we really do have a big bull market. We may have a hard time getting through 8,000.

So that’s why you know it all these years that we’ve done this. I mean I remember Dow 10,000

which that’s a long dang time ago. But I remember my boss coming up to me and I was working in Dallas at the time. My

boss is like this is a historic day. We passed 10,000 on the Dow and all this

and then after it got crushed back down, I came to him. I was like, “Yeah.” And

yeah, but when it got back up to 10,000, when it got back up there, it went right through it. Yep.

So again, you need to hit the ceiling a few times before you go through it. So my bull my bull case is that the bill

that was signed in July just reiterated kind of the tax rates we were in right now is no

surprises. definitely had small and medium-sized business incentives to

expand their business and reduce taxes. Hopefully, they’re not going to pocket it. They’ll reinvest it and give it to

the employees. We shall general business investment. I know our administration loves to talk about the billions or the

hundreds of billions that are being Let’s see if that actually happens. Right? There’s a difference between an

announcement and the actuality because a lot of what we’re seeing right now, they’re talking three, five, 10 years in

advance, but when they announce it, it does good for their stock today. Let’s see what the reality is right now.

Earnings are strong, earnings are good, productivity, I’ve always been a big believer in doing more with less, right?

So, if you let technology do the heavy lifting, we’ll see what happens. Now in conjunction with that AI spending will

continue and whether or not it’s this was like and this is the only similarity that I look at the negative with the dot

era was all they wanted to do was just keep spending and build out and they over spent they overbuilt and none of it

ever became a reality. We’ll have to see where that is with AI spending but also

are I is next year going to be the first year? They said this year may have been the first year, but will there be a

first year or a continuation early on of showing productivity gains using AI?

Don’t know, right? I still haven’t heard yet how AI is going to how they’re going to

monetize AI. I still have not heard of the long term, the medium or the long-term vision. They’re just saying

it’ll happen and you got to believe us. That’s what they want everybody to do. We’ll see. But I think in the end it’s a

lot of I it’s starting to now go beyond okay

the really high-tech company you see it with Meta, you see it with some of these other companies where they’re really

using it for effect. I think the real benefit is going to be sliding out into

some of these industrial companies and I think you your case on robotics there too. I think a lot of the days of

the warehouse worker slugging boxes around and stuff like that, Amazon has already shown you.

Oh my, I didn’t realize how many robots Amazon was using. I was reading an article the other day. They’re looking

to double that in the next year or two. I see it from two aspects. I see it from, hey, this makes sense. And two,

also Jeff Bezos, okay, you guys want to keep trying to unionize? Okay, the robots don’t unionize at this

point, but The robots will become Terminator. They’ll revolt eventually. Yeah, exactly. They’ll be throwing boxes

around everything else. And then, of course, future Fed rate cuts. Now, yeah, I listen, we all want to buy you to

finance cheaper, but this could have a very negative effect to inflation. And those embers could spark up into a fire

again. And I don’t think the average person really understands that why

interest rates go up and down. And that’s a different conversation for another time. We’ve talked about it, but

lower rates, by the way, and this is it was talked about again in the address last night and people just believe it,

but it’s not true. The Fed does not control the mortgage rate. They control the short end of the curve.

The long end of the curve is basically thrown around by the bond market. We’re a bunch of shysters anyway. And it’s a

20 and 30year Treasury. It’s not the short end of the the run because actually when they were lowering rates

in the last year, the mortgage 30-year fixed went up, it didn’t go down. So, people don’t understand that

that correlation. That’s the bull case. The bear case, I didn’t do a base case because I just figure probably the

football be cutting there somewhere in there anyway, right? So, the bear case, I look, the tariffs will have an effect.

I don’t care what people say. They will have an effect. We haven’t heard what the Supreme Court is going to say or

what they’re planning on doing yet or they’re going to or if the administration’s going to defy them.

We’ll have to see. But there’s no doubt in many areas of the market tariffs will

have a negative effect whether it’s inflation, higher cost, whatever. Who knows? Or

potentially the consumer is slowing down, right? We are seeing unemployment tick

up. We are seeing, and I put it in here, auto loan delinquencies have been spiking. Credit card carryover debt,

we’ve been talking about this two years, is going up more and more, breaching 1.3%

interest. Yeah. Even as long-term rates have come down a bit, the credit card rates are just usery

rates at this point, and something has to be done about that. Yep. Yep. And then, of course, war. You

got Russia, Ukraine. I don’t care what they’re saying. There’s no way that Middle East peace is going to hold. I’m

sorry. It’s just not going to happen. Somebody’s going to breach it. We’re going to be provoked. And then, of

course, we don’t know what the hell’s really going on in Venezuela. I don’t know if we’ll ever know, but we’ll see.

Oh, there’s new news actually last night after I did this. We’re going to be supplying Taiwan with a lot of weapons.

I think that’s interesting. And I think that’s more of a ploy for China to come to the table on tariffs more than

anything else. I mean, this is a chess game on four different levels. It’s just crazy. But I’ve been saying for five

years, not if, but when China takes over Taiwan, we don’t know when that’s going

to be, but it will happen. We already talked about the 20 to 30-year Treasury yield remaining high, which will keep

30-year mortgage rates elevated, which I’ll go into the thesis my thesis shortly, where

if we stay above 5 and a half or 6% mortgage rates,

that’ll that’s going to hurt the market. That’s going to hurt consumers. I truly believe that. And then, of course, the

last one, our national debt breached 38 trillion. We went from 37 to 38 trillion faster

than we did in any other trillion range in the past. And I don’t hear any adults

in Congress talking about how do we cut this in half? We’re paying more in the

debt than our military budget. Meaning what we’re paying in just interest payments isn’t going to anything

benefiting the United States. And I have a feeling at the rate we’re running, we could be at over 40 trillion by the

end of this year, by the end of next year. Yeah. That’s the only place where the law of large numbers isn’t working to

your advantage. That thing is just it’s skyrocketing up. No politician is going to come out and say, “Stop spending. They’re not going

to get reelected. They’re just going to keep printing.” Which means eventually, probably not when you and I are around, chi, the

Chinese wan will be the reserve currency. it just but I think the problem with the Chinese

is they’re not in much better shape. Their economy is not growing at the clip that it was before and they’re they’re

blowing the doors out of massive amounts of of debt, too. So, it’s this is a

problem all over the world, not just not just here, but it’s a problem all over the world. But if we’re going to

continue to be the the place that people come to, we’ve got to figure this out and fast.

Yeah. All right. Let’s talk about sectors to consider. I’ll you go first, I’ll go and then we’ll talk about

sectors to avoid. So my themes for this year really revolve a lot around infrastructure. I

just have a belief that with all this stuff coming into place with the one big beautiful bill and everything else. I

think industrials they did extraordinarily well this year. I think they continue to do really well next

year. Natural resources and not necessarily gold and silver which I

think are very much overblown at this point. silver. I used to trade it when I first moved to Austin. I used to trade

silver and it stayed in the $25 range forever. Now it’s in the 60s in just a

year. And that’s not necessarily a good thing because silver is not just a

precious metal. It’s actually used to make stuff. So that cost doubling in a year. When you think of silver solder

and everything else, that’s not necessarily a good thing. That import cost is there. But what I’m saying is

natural resources, metals, timber, all that kind of stuff with the building

boom that’s going to be going on. I think it is a huge opportunity there. I think and my themes for this year,

industrials and natural resources, clean energy. Ron and I were talking about this and he was like, “Energy? What are

you talking about? Clean energy.” What you have to understand is so many of these let’s say data centers if we just

look at data centers alone a lot of these data centers are being built all

over the country and plugging those into the regular electric grid really doesn’t

work because they can drain the electrical grid. So, a lot of these companies are having to not only build a

plant, but they’re actually building electrical facilities on top of that. And a lot of them are looking at

renewable energy, clean energy. So, they’re throwing in even some smallcale

nuclear plants. I just watched something this morning on Fox Business where they

toured ThreeMile Island and they’re firing that up again. It’s been closed down since 2019 as a way of generating

that. It’s Microsoft that is you setting up a data center in the area. They’re also providing a lot of the AI

technology for the new plant or for the reopening of the plant. Last not least,

5G and future connectivity. Think of the big boys here, Google, Meta, Nvidia, but

think about Take 2, Roku, Twilio. Those are all companies that are part of this

piece. So if you set up a data center, you’ve got to get that data out of there and into it. So these are the guys that

build that piece of it as well. So that’s my theme for this year is that overall look at all the bits, pieces,

and parts of the industrial side. uh with my portfolios that I run for clients, I actually set up these three

sleeves with about five stocks in each of those that will rotate throughout the year, but those are areas that I’m

focusing on as an enhancer to the portfolios for this year. Gotcha. I’m going to keep mine simple.

Healthcare and biotech, I think, are going to continue to run. I think the administration’s not only going to let

M&A happen, but you’re going to see continuing because it has happened recently a lot of the large and mega cap

buying up the small and medium cap. It’s already happening. Defense and aerospace. We’re not going to stop spending on defense. Obviously,

with what’s going on in Venezuela, we don’t really know what’s going on yet. And there’s I don’t think there’s going

to be many countries coming to Venezuelan’s defense, but we’ll see. Besides China, we’re not going to stop spending and

aerospace. Musk. SpaceX is gonna go public next year. I’m really surprised

because I know Musk doesn’t like answering to anybody and he doesn’t like when people take the other side of his

trade, which is essentially the stock. Uh but we’ll see. But defense, I think, is always going to continue to run. You

buy on the dip forever on defense. That’s the theme with that AI, robotics, and cyber security. Even if we have a

bare market next year, I’m not saying a recession, but even a bare market, obviously, these three areas are going

to get hit the hardest, you keep adding to the positions at a discount because this is a long-term play. And if you

could buy these at a discount in in in a pullback or a bare market next year,

you’re going to do that much better. So if we continue to do this from year to year, you’re going to see probably at

least defense and aerospace and AI, robotics, and cyber security continue to be on my list.

Yeah. Permanent. Yeah. It’s a permanent Yeah. fixture. And then of course I have it here, too.

I But I also have it on my ones to avoid, but I think real estate is going to be on one side of the seessaw or

another, and it’s all going to be on 30-year fixed rate. And here’s the issue with it. For either the ultra positive

or the ultra negative, we’ve essentially been in a bare market with real estate for almost three, three

and a half years, if you want to look at it that way. The pentup demand for people to move out

of their houses or for people to move into an area or into a house is so high

right now, they’re licking their chops to try and make this happen. The second

part of this is the refi market. If we get the 30-year fixed under five and a

half or even closer to 5%, we’re over six now. People will be taking money out of their

house, right? I mean, multiple things, general spending or remodeling their

house. So that will create that much more of a consumer boom on the refi

market of more money going being injected into the economy of people taking equity out. So yeah, that’s those

are my sectors to look at. Talk to me real quick about your sectors to avoid and then I’ll wrap up with mine.

So I think from my perspective, health insurance I it’s just going to be a mess

this year. Congress is going to try and wait into this. There there has to be some major stuff done on this. And the

health insurers, I’m sorry. I just can’t even invest in them because I they have

just taken the money from the government and just continue to raise premium after premium to make it to the point where

basically health insurance is unaffordable. So government should put a cap on the

increase each year. They won’t do it. Too many lobbyists. Yep. Absolutely. Utilities. Again, this

is my second year with that. While I believe that my my theme when it comes

to the overall with energy and everything else, I think

a lot of these utilities are going to have to be making some massive investments in their grids and that just

means less profits going to the shareholder. And yeah, this was somewhat

controversial when Ron and I were talking about this. I think AI, I honestly believe that although AI

spending will continue, I just have a feeling that a lot of these stocks have a heck of a headwind and have some

multiples that are unbelievably high. I just have this nasty feeling that we see

a little bit more headwind against them for this year. So, that said, I’m going to limit my exposure to them a little

bit throughout the year. Gotcha. Could be totally wrong. Just saying. M mine’s pretty simple. I got energy and

oil. Again, I agree with your assessment with 50 to 60. I don’t think it’s really going to stay above 60 or 65 for at

least another year, maybe two. They did talk about though if for if it goes into

the 40s, these oil production companies are going to be losing money.

Yeah. Because of their cost to get it out of the ground and then refine it. So, I

still look at energy and oil being depressed. Consumer discretionary two years in a row for me. If employment is

certainly going up and 30-year mortgage rates are going to be high, I

still look at discretionary kind of being depressed. I I think it’s got another year to bottom out. Maybe 2027

will be a good year. And again, I already gave a little foreshadowing with real estate. If the 30-year fi if the

30-year fix remains above 55 but really above six for the majority of the year,

mortgage companies, the banks, they’re not going to make their vig on all those mortgages. I think it’s going to hurt.

It’s going to have a trickle effect, right? Not only materials, but labor, it’s going to affect financial

organizations, banks, so on and so forth. And this is now three years in a

row. I don’t know if he if we go in a fourth, this could be a huge bare market

in this sector going into 2027, especially depending on what happens in the midterms.

Yeah, like I said, and the fact that they’re doing nothing to really address the deficit, it just continues to add to

the fact that the bond market’s n we still don’t think it’s, you know, we’re not pulling it back because we see this

thing just keep accelerating. And I think we had a little bit of a a chance

with Doge and that just got tamped down by the Washington establishment and you

don’t really have those people out there anymore going, “Hey, we’re going to figure out ways to make this to slow

this at least slow it down.” I I just think it’s going to be a tough sled

going forward. And I my conspiracy theory is I think the banks andor financial institutions

are in the mix to keep the mortgage rates higher. They know they can make maybe some money on the downside. But

the idea is that they’re making some pretty good money on the interest the loan on the current mortgages. They may

try to ride that out for another year or two. I don’t know. It’s a conspiracy theory on my part. Yeah. But I I quite

frankly the 30-year should have been under five and a half if not the end of last year earlier this year and it

hasn’t been. And you’re rolling into roughly about fouryear cycle right now of people not

really moving. That’s why the inventories are where they’re at. You’re going to get to a point and I was

talking with my realtor friend about this the other day and he was sharing some of their economists insight about

what they see for the year and we were talking about that and we’re on that year four cycle. Typically every five

years people move or the a bulk of people move and we’re rolling into that year five going into next year where it

may be some people are just forced that they have to move at that point. The the other part of that too is if interest

rates on the long end come down precipitously and bring down a 30-year fixed, what else are you going to see?

Yeah. House prices. Yep. Because now there’s that much more of a demand. And in hot areas like us, prices

have remained fairly stable and or have gone up. Yeah. Ours has gone down pretty significantly.

Those interest rates come down, those prices are going to get elevated. Oh, they’re going to rocket back up. Absolutely. That’s what we were talking

about that just in the watching Zillow the price of my house from like when it

was at its high to where it’s at now. It’s a pretty wild swing in in a period of a couple years to up to the high

which I would have never paid that amount for my house to where it is now. And I’m like, yeah, it really is

probably worth a hell of a lot more than it’s they’re saying it’s worth at this point. I will tell you what’s not going to

change our predictions for next year when we do our midyear review. Absolutely. Ours

will be done. So folks, we do these for you. I hope you enjoyed it. Bookmark

this one and go back to it. Certainly you can hold our feet to the fire on it.

But we will see you guys back here in the new year. This is our last show for the year. Make sure you subscribe

because we will be back and on target the first week of Yeah, probably second week of January because first week of

January is like right in the middle of January 1st. All right. So, we’ll see you guys back here after the new year.

Have a wonderful time and wonderful holiday season. Enjoy your Hanukkah,

Christmas, festivist, whatever you celebrate.