Good morning folks. Welcome to another episode of the sense of things and going into the holiday weekend. We are heading

into Labor Day weekend and hopefully everybody’s going to have a fun and safe holiday weekend. Today we’ve got this

week in history. Ron’s got some stuff on earnings and the top seven just continuing to lead the pack when it

comes to earnings. Ron’s going to go over the fear and greed index and our national debt. And I’m going to cover a

little bit off of the briefing.com economic calendar and some of the things that happened this week and some of the things that will be coming a little bit

later. So hang on. We’ll be right back on with you.

Hey everybody, welcome to the show. Ron, how are you my friend?

Good morning. Good morning. Yep. It’s tough to say this is the end of the summer with Labor Day because it’s still pretty I got to tell you, it’s been hotter in the last week here than it has

been three months ago. But out here, they started school end of July, beginning of August. So for them, the summer was over a while ago.

But I don’t know. How about what is it about you?

I think our kids went back maybe a week ago. They would they were kind of sta staggered over the last two weeks, but

yeah, we’re in the hundreds. We’ve been continually in the hundreds for 23 days now, but heading up to Dallas, Fort

Worth for my visit family. And wow, it’s a cold front up there. It’s 96 degrees, so looking forward to it. Better bring a jacket.

I know. Yeah, we had that little mini, whatever you want to call it, tropical depression come through. And of course, central Texas got absolutely none of the

rain at all. I hear you. I hear you. All right. So, this week in history, I think we’ve done a full circle here over a year. I’ll have to double check.

Yeah.

But there’s some Nobody remembers from last year anyhow.

Yeah. Light week. So, 1777, Stars and Stripe flag flies for the first time.

Thought that was pretty sewn by Betsy Ross, by the way.

No matter what her family not sewn by Betsy Ross.

I know. We had that conversation. We had that conversation. 1789, Congress founds the US Treasury.

Interesting.

So, a lot of people think, wait a minute, what was that thing in the early 20th centur? No, that was the central bank.

This is the US Treasury. So, this is creating our own money, blah, blah, blah. So, anyway,

1868, George Eastman patents the Kodak camera, and then it was about a hundred years

later that he did the Polaroid, the instant picture. Yeah. Not him, but the company.

Yeah, the other. Yeah, the other company. 1928 for all those people with VD.

Penicellin discovered by Sir Alexander Fleming. I know penicellin is good for other stuff.

Audience doesn’t have VD. I’m just saying.

I’m just saying. I don’t know. I’m joking. But I know I know penicellin’s good for other stuff. I just don’t have a good list.

1939, first televised Major League Baseball game. Interesting.

Reds versus Dodgers. I could only imagine what this looked like on an eight inch circular.

Did he pitch? I couldn’t tell. I couldn’t see it.

That and those the or the the cathode ray tubes back then. It would be like a ghost image on stuff too.

TV really didn’t get good until cable.

And that wasn’t until we didn’t get cable until 81 or 82 because of something in our development. And

dude, my parents were so cheap. We didn’t get a TV with a remote. I was the remote. I know. So was I for many years.

Actually, I don’t remember. We didn’t get a remote. No, our first remote was with the cable. Okay.

Because you had the cable box with the remote, but our TV was not a remote control. But cable, I think, started coming out in the mid

mid early mid but I think mid70s. Didn’t take hold of the late 70s. And it was really the early 80s when it took off.

Yeah. My my uncle was in the the satellite business. So we ended up we had a satellite dish that he put in and

we had Showtime which was on the little terrestrial antenna thing back then. So we always had that stuff. But yeah, it

was there was no remote for the TV at all. But yeah, 1939, Germany invades Poland and

now the world finally starts to get worried. Yes, Hitler just wanted a little piece of Poland, a little piece of France.

He got the He tried to get the whole thing. 1964, first Japanese player to play in the Major League Baseball, which I did not know this. Miraama was

interesting because Boston Red Sox were the last team to integrate with a black player. And I think that was

right at the end of Ted Williams career at the late 50s. So, this is just interesting this whole thing. So anyway, I don’t even know who he played for.

And actually the other thing too, like Roberto Clemente, people they felt like it would be bad to let people know that he was from Puerto Rico. So they called

him Bobby, which he hated. And even when he got interviewed in the 71 world after the 71 World Series, I think it was

Bobby Clemente. Then they finally started, he told when it became okay, he hated being called Bobby. He wanted to be called Roberto.

I don’t blame him. I wouldn’t want to be called Bobby. I’ve never been called Bobby in my life. Why the hell would But they thought that calling him Roberto would be too ethnic.

Oh, heaven forbid. Ridiculous.

1969, the first ATM was used at a Chemical Bank in Rockville Center in New York. And people that don’t remember

Chemical Bank, they were bought by Chase Manhattan. And then JP Morgan bought Chase to create JP Morgan Chase. So that

was the evolution and the consolidation of our banking industry.

And just like today, Fleet Bank and Bank of Boston were both bought by Bank of America and the consolidation just never stopped.

Nope. Wovia was bought by because I remember growing up in North Carolina, Wakovia. Wakovia was bought by First

Union because First Union had such a horrible name because then they ended up changing the C the bank to Wakovia and

then they got bought by whoever by Bank of America of course. Yeah. 1985 the Titanic wreck was found. Remember went down 1912.

Obviously they didn’t have all the technology. Also, they kept looking in the wrong location because obviously they said from where it went down, it

floated almost two miles from the place where it went down from the those coordinates. Yep.

1998, federal legislation mandates airbags in cars. Airbags, I think, first

started in the 70s, started to become a little more prevalent in the 80s, but I was a little shocked to to see 98 was the year they made it mandate.

Yeah, that’s surprising. Okay, here we go. More fact set stuff. The top seven stocks driving earnings.

You know, I refuse to call them the MAG7 and then versus the other 493.

And this is just absolutely insane. The these companies are literally, forget about having a printing press, they own

the monetary system. I mean, [laughter] this is just absolutely insane. The charts on the left is looking at where

it was today versus the estimates and what it was at the end of June. So, this is just like one month later. And then

obviously on the bottom, we’re looking at just earnings growth versus obviously the rest of the companies. And you could

just see if you pull out where Google and Amazon are down here. This is the earnings without Google and Amazon. And

if you add in Google and Amazon, everybody talks about Nvidia still making money, but Google and Amazon,

they are just beasts. And and then, oh, by the way, here’s the other 493 companies in the S&P 500.

This is I know we’ve shown a lot of charts. If you just try and digest this, it it’s almost unfathomable

what they’re doing. And then if you look at the the chart on the right, we’re looking at the top five contributors.

Obviously, we know about Micron, but then you take a look at Google, Alphabet, Chevron surprised me being in here because I’m I’m not an an energy

investment guy. And then obviously you got Amazon and Nvidia, but this is these earnings that they’re unsustainable, but

here they are for the last what four years since the end of they’re unsustainable except they are sustainable because they are a beast.

They’re literally printing machines, right? They’re sustainable as far as they’re going to continue to make money.

Not at these levels. I mean, yeah, at some point this has got to even out.

You look, we’re money managers and if you’re not at least have some in somebody that has even a moderate or even a conservative to a moderate to a

growth portfolio, you have to be invested in an index fund that’s exposed to the top 10 stocks. You have to just

some money. Forget about investing in the individual shares. You got to be at an index fund that’s exposed to that to

those top 10. If not, you are not you are going to lag behind for years. You’re going to be left in the dust. Just insane.

Yeah. Now, it’s been interesting that the last seven to eight months we’ve seen the large value actually show some life, but still

and they’re moving up. This is earnings, not necessarily stock price and market. This is just earnings.

End of the day, what comes out of the bottom? This is what’s coming out of the bottom after all expenses. This it’s just

a lot of it. And two companies that are spending ungodly amounts on AI and they’re still earning money left and right.

I think 30, we’ve gone over this, 30% of Nvidia’s revenue is from the four or five of the other top companies in the

top 10. So, they’re all they’re all helping each other out. But it just it’s just incredible. There really is.

All right. Fear and greed. CNN produces this. And I thought this was interesting that while the market has been going up,

there’s been fear. And a week ago was neutral because I remember seeing that and I wanted to bring it up today. And then when I looked it up today, I’m

like, wait a minute. Three three or four kind of rough days in the market. But all of a sudden we tick down to fear from 53 to 44. This is just telling you psychology and behavioral science.

No, but it is. But it’s also if you look at history, there has never been a positive September in a midterm election

ever since 1932. There has never been a positive September during a midterm

election. The odds are we probably won’t see a positive this month. Now, things could change. We have a president in the

White House that can change stuff in a heartbeat and that may make a difference, but but yeah, I kind of went into this month or I’d been in this kind

of a war footing because I’m like, I just look at the odds and the odds just ain’t good. So, I can understand the fear level a little bit. September and

October. You know, they always say the October is the month of bottoms and certainly midterm elections and also just seasonality. September and October.

Just both of those alone give you two weeks, which usually means good opportunities will be available by October.

So, yeah.

Yeah. But, okay, keep going here. The bond market, the bond market’s been bad, but the junk bond market is showing

extreme fear. I just obviously this was like during the the beginning of the war because the war is not over to show an

extreme fear. Now, I’m kind of curious what this really means because the 10-year

hit 475 or 476 this morning, ticking up towards five. That’s it’s not a good sign, but just the bond market overall

is not great. And then on the right side here, just look at a market momentum.

You can see folks, what what are we within one, one and a half, 2% of the all-time high. We have fear.

It’s just crazy. And then stock price strength. The market’s going up, but the stock price is going down. This is your

indicator to maybe not go to cash, but maybe have cash ready for when you like

certain things at lower prices. This is when you want to go in. What are your thoughts?

Yeah, same thing. Yeah, like I said that kind of my indicators were showing me, okay, things are getting a little weaker and weaker and the the one thematic

thing that I had for this year was data centers. And you’ve got some headwinds in there with of course the politicians have gotten in the middle of all this

crap. And I I still personally think this is a whole bunch of social media crap coming out of China that’s stirring

the pot with all of this so that they can get ahead a little bit. But yeah, we’ve seen all those stocks even though there’s been tons of money being spent.

We’ve seen those stocks pull back during the summertime. So yeah, I think it’s it’s right now for me it’s be on war

footing a little bit, raise some cash or have some some lower risk investments that can be flipped into something if there’s an opportunity. And I think

there’s a I think there’s a big opportunity this month for September 15th, which is the next Fed meeting. I

think after last Friday’s Fed or last Friday’s Jackson Hole speech, I think Wars laid it out there pretty well and

said, “Figure it out yourself. We’re not going to tell you anymore. We’re going to keep things a little tighter to the vest and we’re going to let you know.”

So, you see it every every day. before Jackson Hole. I know they were interviewing the one Fed governor from

Cleveland and she’s just a hardcore we need to raise interest rates at least another 75 basis points which is just

psychotic. And then you had who’s his face this morning? It came the other one.

Waller. Yeah, Waller. He’s like, “Hey, I’m I’m in favor of just keeping things neutral at this point.” So the market is swaying based on what each of these guys

is saying because we’re not they’re not going to be giving any predictions of what they’re going to do going forward.

So, it’s I think the market’s gota the market and the bond market and everything else has got to figure this out of how they’re going to

deal with this going forward and build some models that they can count on instead of just constantly and I 100%

agree with Wars this this whole where we’ve been for the last two Fed governors of everybody just literally

living on exactly what the Fed’s saying and what is the Fed what’s the direction the Fed’s going. It doesn’t matter.

[laughter]

You need to look at this data yourself.

I do. I built a model that actually tracks all this data for me so that I don’t have to try and gather it. It’s an

AI model that does it, but I make my own decisions. I don’t make decisions based on the Fed at all.

Yep. No, I agree. And then lastly, we we shown this slide before. Here we are, folks.

And the funny thing is we just went over 40 trillion two weeks ago and we’re already down another hundred billion

in the last two weeks. We we’ve gone we could keep talking about this forever, but in the end this is just

absolutely insane. And just the interest on the debt alone is 1.1 trillion.

Yeah. Which is insane. I don’t know how we reverse this or forget forget about cutting in half. How do we just reverse the momentum

on this? And look, the left could blame the war. The right could do this. Yeah.

Doesn’t matter, right? The war is a part of this, but it’s not all of it. It’s it’s just the spending is just

it is this belief that we can’t stop spending because if we stop spending the economy will stop and everything else.

Okay, you got to stop. And you got to stop borrowing.

Yeah, you got to stop borrowing. We’re getting to the point where we’re printing money to borrow buy our own bill, our own treasuries because nobody

else wants to buy them. Yes, totally agree. And we need to we really need to elect some people that actually have

some guts about them that can say, “Hey guys, we got to slow this up.” Hey, good luck with that.

It’s never going to happen. Yeah, I know.

What do you got? All right. So, just quickly, let me go over briefing.com. I usually use the econoday calendar, but I

actually subscribed now to briefing.com and it’s a nice little concise layout.

So, couple things this week. Really no major numbers that I said, “Wow, this is just off the charts.” The high trading

impact numbers are things like ISM on Monday. It’s still 54, which means we’re still in a growth mode. It was a little

less than the briefing.com forecast and consensus. So, yeah, we’re still within striking range. ADP, you and I have

talked about a lot. I just don’t get ADP. Sometimes you would think they would have a really good handle on

hiring numbers, but their numbers just seem to be so far off from the federal government’s numbers. So, either they’re

right or the government’s right, but who knows? other high oil inventories, they’re where they were supposed to be.

High impact trade balance is actually going the other direction again. It was getting better and it started to go the other direction at this point from a

trade balance standpoint, which is interesting because the dollar’s been strengthening against everybody else.

So, you would think it would go the other way, but ISM manufacturing index up a little bit. The big number for this week, I think the most important one, I

know today they were talking about initial claims. Oh, they were higher than normal. They’ve been less for the last multiple weeks. But the big number

I think for this week is tomorrow. It’s the jobs number. It’s going to be right before the Fed meeting. And once again,

this is all kind of your own data instead of a data dependent Fed that’s predicting things. If I were a betting

man, I would bet we get a surprise. And I think we’re going to get a surprise on the positive side at this point. That’s

my belief is I think we might see a a a positive surprise. I know briefing.com

is expecting 40,000. I could see it as high as 70 tomorrow. So, we’ll see.

Maybe I’m wrong. Maybe it’s another surprise like we had in June or in July.

But we’ll see at this point. But that’s really it. A quiet week going into the Labor Day weekend.

Yeah, it’s definitely temperatures going to start rising here right after Labor Day with the elections,

which I am not looking forward to my phone number being on a bunch of list where it’s going to get blown up. I remember

not even during two years ago during the president. I remember the midterms four years ago. The last month leading into

the election, I must have gotten a minimum six to eight spam texts for

political stuff. It is just it’s just getting nastier.

Yeah, I’ve got them all blocked pretty much. But I pull up because I like a lot of times when I’m working at work, I’ll pull up my Windows phone link and she

I’m like, God, I can’t imagine how many I I would be getting that aren’t getting through, but they come through on that.

They’re not getting blocked by my spam blocker. God almighty, can we get past this point? And it seems like I I get them still even after that.

Yeah.

And I don’t even know if any of this is legit or if it’s BS stuff. So I don’t even Yeah, but you can’t block them all because then they sell your information

to somebody else with a different number. Yeah.

And they keep bouncing numbers with everything else. So yeah, it’s just it drives me nuts.

Yeah, the the whole text thing now drives me absolutely baddy.

Folks, thanks for joining us for another week. We’ll see you guys back after the weekend. Everybody be safe. Enjoy time with family and all that next week. And

we hit the ground running after Labor Day Monday. and we are off to the races going into September 11th week and then

the Fed week right afterwards. So, have a wonderful weekend and we will see you guys back here when we get back next week.