hello our wonderful audience welcome to

the sense of things it’s Ron and I once

again on talking a little bit about

what’s going on in the world this week

um Ron’s gonna have some stuff on really

how you game plan for the next six

months years all that although they seem

like they run together are not

necessarily truly that way I’m going to

run through a little bit today on the

price of gold looking at the treasury

yield curve and we’ll also look at the

30-year fixed which all things are

responding weird to the interest rate

drops that we’ve seen so stay tuned

we’ll be right back in just a

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second hey everybody Welcome to the

sense of things Ron and I are here Ron

how you doing buddy morning Jeff good to

go I don’t know about you similar

climate we went directly from Summer to

Winter we got no fall really yeah oh oh

it’s been cold here in the mornings my

friend and being a Northeast guy I

missed the fall but we’ve had some fall

hemps every now and then but it went

from Summer to Winter we we have had a

very weird fall we’re still in like the

mid 80s every day so today was the first

first morning except for one day at the

beginning of November that it was in the

50s starting off the day so Hey listen

are we starting to sound like old

codgers or all we talk about is the

weather soon we’re going to start

talking about how many doctor

appointments we have this week yeah

exactly and and died last week yeah did

you check the

obituaries hey I do every day just to

make sure I’m not there and then

everything else good the rest of the day

if I’m above ground life is good and if

I’m below ground I don’t really have any

say in the matter so

well let’s let’s kick off we don’t

really have any pop culture today but I

why don’t we kick off with your stuff

talking a little bit about staying

invested listen considering the two

states we live in we have a lot of

polarization as far as team red team

blue yep I’m team purple and people were

like oh economy is going to go to hell

this and that’s going to happen if this

person’s elected here you go folks this

is all you need to know if you only

invested in a Republican president since

1949 you didn’t make much money if you

only invested with a Democrat you did

okay but guess what if you just

swallowed your opinion on what’s going

to happen with the market you made a lot

of money over the years even if you just

put it in 30 years ago you made you did

pretty good so a lot of people get a

little nutty with this and I know

there’s a lot of information up here but

you could just see on the far right side

really what happened the year following

the election if you notice there’s a lot

of double- digigit years there yeah a

lot of double digit and only a few

negative years and you know what if you

take a look at what happened during

those negative

years coming out of War coming out of a

Black Swan event whatever the case may

have been but what it comes down to is

stay invested usually it’s year number

two of a presidential election that is

the worst performing of the four years

but for the next 15 months 14 months

stay invested what are your thoughts

here because I got some more good stuff

on this yeah yeah and we covered this

last week too in in the episode last

week it’s if you look at that year

following and really about 18 months out

from the election we typically see and

and it’s typically when we’re coming out

of a one party and you go into a new

party coming in there’s typically you

see a pretty good runup uh and it

there’s better performance if an

incumbent doesn’t win I think we’re in

good shape we’ve got a we’ve got a a

White House we’ve got a senate and we’ve

got a not yet not confirmed yet nope

house is house was called this morning

so that 218 so it’s Trifecta yeah so

they’re just now at 218 possibly could

go up a little bit but the the benefit

to all of us is the biggest thing that

they’re all focused on is making sure

that we form taxes um hopefully there’s

even more help from the tax perspective

there that I think the biggest thing

that’ll come out of this is a lot of

deregulation if you look at Trump one

there was a lot of deregulation and that

that that’s the biggest thing for small

business I’ll tell you what that is I’m

gonna actually go forward yeah and come

back that’s a great segue because

actually the market does not as perform

not does not perform as well many times

when one H one Administration controls

all three and I wanted to bring this up

because looking at five periods uh you

can see where the S&P was during that

time frame but look at the times when

you know one Administration controlled

all three information technology and the

most boring sector out of all them

utilities did I I find it to be

interesting I’m not an energy guy I I I

don’t like things that are pegged to Ay

oil but you know what energy has done

pretty good with administrations that

control all three branches again looking

out where do you want to go where do you

want to put your money stay invested and

you don’t want to trade yeah yeah yeah

once again we’ve seen that year in and

year out the trading is just

never I I rebalance every month so some

might say I trade but I just rebalance

based on a Model that I have but yeah

I’m not moving around a lot it it just

doesn’t work you end up getting whip

solid every time when it comes to that

so if you’re thinking okay great Market

historically has been up the year

following uh presidential election where

should you put it oh let’s go for the

growth right but actually history has

proven value value is where you want to

put your money and here it is one month

two month 3 month all the way to 6

months value has beaten growth

historically over time and not by half a

percent or 1% by three and a half per.

so again nice slow growth is the way to

go 30% angle not not 80 30 that’s where

you want to be turns into 80 the other

direction and then 80 the other

direction and yeah I I look at our S&P

chart right now it looks like that yeah

and I I look at Value it’s funny that

people get the oh well value just

doesn’t work it’s underperforming I’m

looking for steady stable

consistency and when I pretty much can

count on a dividend coming in if I’ve

got something that’s averaging six s%

dividends to get my 10% average in the

S&P 500 I only have to have 3% extra

growth in those cases looking for things

that have got really solid stable

consistent even growing dividends even

if those are only at around 5% it’s

pretty easy to get that extra 5% growth

over time 100% so the these are a couple

things to consider and then the other

thing that’s the positive the

interesting thing is folks guess what we

have economic Cycles what we’ve seen in

the last 15 years is not normal with

economic cycles and where I’m going with

this is that we showed a chart on this

earlier in a podcast about month and a

half ago I thought it was interesting

and I wanted to bring it up again and

add another one that the vi the bank the

business bankruptcies are spiking and if

you just take a look at where we’ve been

historically with a lot of this we’ll

see where the year ends up not great not

great I don’t know if you saw it but

there has been more restaurant chains

smaller but more restaurant chains and a

couple of furniture chains that just

closed the doors in the last week look

those are two Ty difficult businesses

right Furniture is not a residual

business and the restaurant business is

an SOB to run and make successful and be

sustainable so I’m not sure what you’re

seeing on your side you know what so I I

always say that there’s the Jeff the the

Jeff gut cycle I just look at anecdotal

things but one of the anecdotal things

that we my wife and I have gotten into

is we’re big fans of guyer’s diners

Drive-In and Dives and it’s amazing how

over the last

I would say two to three years so not

pandemic time period but after pandemic

watching how many of those businesses

that are were on diners Drive-In and

Dives that have closed since so we watch

a lot of the old episodes and amazingly

how many and they get this massive boost

of wanting to go there and stuff like

that and how many of them have closed

yeah but Jeff they’re not changed

they’re not they’re small small business

but and but that’s what I’m saying is

there that tells you how hard it is for

small businesses at this point to get by

I think a lot of it’s just you’ve got

stupid silly regulations from the

government you it’s just a tough economy

and I see it it’s funny we have a a

chain called chewes here in our area and

chewes if we got there you if we get

there on a Saturday at let’s say right

at 11:00 when they open

within 15 to 20 minutes that restaurant

is packed and I can’t tell you how many

times locally we’ve

noticed that you get there by the time

we’re leaving at let’s say 11:45 or noon

the restaurant’s half full and it’s one

of the most popular restaurants in town

so that’s telling me that people are

stretched when especially coming into

the end of the year it’s Christmas time

people looking at hey whatever I could

do to to save money so I have money for

my kids for Christmas hey credit card

carryover debt just hit 1.2 trillion and

the average is now over 22% let see what

happens through these holidays all right

what do you got let me let me share my

screen here a little bit and I wanted to

go through a few things that I’ve been

looking at here lately all right

share booah okay so first of which had

some conversations with clients

regarding gold and Gold’s done great we

need to stay in Gold this I think is not

the to start to look at gold and say hey

we want to invest in it because after

the election and this is literally the

day of the election right here actually

it’s October 30th we saw really the peak

in gold and it has been down ever since

and has broken that down Trend a little

bit and I think it’s going to struggle a

little bit and the reason is a lot of

people I believe were plowing money into

gold of course the world was going to

end if Camala Harris got reelect fear

trade got elected it’s fear trade Ron

and I were talking about this before the

show now there’s not the fear trade the

stock markets going up now everybody’s

selling out of gold and jumping

someplace else do I believe that there’s

a possibility that there’s a place to be

for gold down the road and in a

portfolio yes do I feel like right now

it is probably not one of the things

that I would say hopefully and and we’ll

see this as we go through some of this

before you do that just to let you know

the other thing about gold I am not a

gold bug I do not recommend gold it

doesn’t pay a dividend so if you’re a

retiree and you’re trying to squeeze the

juice out of the orange with

income how is gold part of that

portfolio yeah yeah this ain’t the place

for it and it’s a speculative trade

people don’t think it’s that but it’s a

speculative trade and if you look at the

long-term history of it really the last

12 years gold has gone up above its

long-term Trend and its long-term trend

from 2010 back to 19 I think it’s 32 or

31 it’s long-term Trend appreciated less

than the price of a man’s suit right and

don’t forget from 2012 to

2022 it went nowhere but down yeah yeah

so you bought 2012 you were even in 2022

yeah exactly once again it’s might be a

diversifier in a portfolio I would not

be looking at it right now and it’s

going to be out there so why typically

people will talk about in the case of

inflation that’s when yields when gold

goes up and the dollars devaluing and

blah blah blah blah blah blah blah blah

blah let’s take a look a little bit here

we’ve had interest rate Cuts here in the

very recent history history Long awaited

50 basis points 25 basis points last

week let’s look at the 2 to 10 10year

treasury minus the two-year treasury

it’s not really gone down in the last

couple of positive now it is positive

but it’s sitting here flat let’s look at

the yield curve which is literally looks

like a roller coaster at this point our

one month is up here 4.7 are three years

down here at 4.25 the 10 years back

finally up to 445 but it’s been rising

the 20 year is up here around 470 and

the 30 years is below that so it’s just

all over the fence right now and it’s

changing on a weird basis how is that

affecting the the things that are dered

on that 30-year

fix is popping back up even with

interest straight cuts we’ve now seen

the 30-year fixed mortgage pop back up

and is continuing to rise which has a a

trickle down effect onto housing which

then has a trickle down effect onto

things like Home Depot and lows and all

the pin action that happens as a result

of house

sales and it’s forcing people and or

it’s not forcing it’s just making people

go I don’t want to move at this point if

I’ve got a lower mortgage

I’m not going to move someplace else and

more than likely those people already

did a lot of their Renovations and

things like that over the last several

years so how is that affect things down

the road now my personal feeling on a

lot of this is that we’re coming to

roost on a lot of our and this is both

Republicans and Democrat administrations

we’re coming to roost on our our just

keep building up debt and what’s

happening is those that buy our debt are

demanding higher interest rates as a

result of it and I don’t really see that

going down unless we put the government

on a diet what’s your thoughts

Ron I got to tell you that curve is an

anomaly that is not a normal curve it’s

either u-shaped or n-shaped that’s

typically the way it is I’m I was never

a bond guy before two years ago and when

you’re looking at this

uh if you’re taking if you’re trying to

consult with a client on protection or

uh security or whatever no who’s going

out to 20 to 30 years nobody’s really

doing that but then again you don’t have

to hold on to it that long but not many

people are doing one in two month we

haven’t done we haven’t done any new

treasuries in a month and a half right

we’re not planning to do anymore because

we could do better in preferred stock

but look at the two and the threee

that’s a nice short term you’re getting

sign significantly less than law so my

whole point is that I don’t know how an

average investor would want to put money

into any of this when there’s better

yield better performance elsewhere yeah

this is for banks this is for

institutions but it does affect us

eventually it does and once again I just

don’t see these things fixing themselves

anytime soon okay yeah I could put my

money out here and and do a weird

short-term ladder

that goes out basically four to six

months but the average yield is not

there so I agree with you I think

there’s better yields now and and have

been for a little bit now there’s better

yields on the preferred stocks better

yields even in inside dividend paying

stocks there’s way better yields right

now and you still have a little bit of a

potential of growth too within there

prer stock is probably one of our

largest asset classes right now across

all our clients first of all you could

easily get 5 a half% dividend yield fix

and you’re buying them at a 15 to a 25%

discount and many of them have a

redeemable date in the next year or two

so unless you think like the big banks

are going to go under you’re G to get

you’re you’re going to get 15 to 25% on

one side and five and a half percent on

the other why would I go into any

treasury right now other than knowing

okay it’s backed by the US government so

are the top Banks yeah

exactly yeah totally agree with you I

think it’s an interesting time I think

it’s going to be an interesting next

couple years here in the markets I I I

don’t know when the yield curve kind of

stabilizes itself to something normal

because normally it just looks like a

nice little uphill it makes sense the

longer out I put my money the more more

interest I get paid and it has not been

for a long time and it’s really been

interesting the 20 years has popped up

whereas the 30-year hasn’t moved which

it’s been that’s been weird over the

last couple years here where it just

keeps doing that and that it doesn’t

make sense that the 30y year is it’s

blood my last point to that what’s going

to fix the curve so I’m far from an

expert in it but I do follow it I do

listen to some smart people about it I

think the one of the biggest factors if

not the biggest factor to it is our debt

yeah I don’t know if we’re but I know

we’re near 36 trillion and I think

that’s a combination of risk and return

and true like Risk and fear Y and I

think that is made the entire yield

curve wonky as far as where Banks and

institutions want to try and fix

themselves well as far as I’m sorry not

fix themselves but at least protect

themselves on the risk curve for them as

best as possible how they’re doing it I

have no idea but I think that’s why the

risk curb is as wonky as it is because

of our debt and we keep issuing more

debt I haven’t heard either side talk

about less spending and or increasing

taxes to cut that in half because of

that 36 trillion and I promise this is

the end of the rant more than half of

that was created in the last five years

yeah yeah it was covid hit and it was

this government going we want to keep

everybody happy so we’re just going to

keep piling money into everything and

once again I’ve said this all along it’s

Republicans and Democrats it is not one

party or the other it’s they always are

trying to figure out ways to to keep the

people voting for them by dumping money

down their throats and it it’s one

version or the other of it and nobody’s

really sitting there saying all right

it’s time to to fix the problems who

knows we’ve got the the do Department

coming up which I think is very funny

with with Elon Musk him and his doge

thing it’s always there’s always

something Doge related to all that but

uh we’ll see I think there is

a it sounds good to say we’re gonna make

government smaller but it’s a big old

challenge that there’s a lot of

resistance there from a lot of

government they could easily reduce

government 10 but probably closer to 15

to 20% with today’s technology and

everything we don’t need as many people

the thing is there’s been no incentive

to do that and until you incentivize

somebody and I don’t know how you been

artificially propping up the employment

rate yeah very much and that has been

and and it’s interesting that 12,000

jobs was virtually that we saw a couple

weeks ago was all 100% government jobs

and nothing in the private sector so

it’s I I think it’s going to be an

interesting World here over the next

couple years I would foresee a lot of

really crazy battles between government

organizations and the bureaucracy and

the administration and Congress and

everything else so it it’s going to be

an interesting we we grab your popcorn

because I think more conversation for

next week exactly folks thank you for

joining us we do these shows for you

make sure that you uh subscribe to the

channel make sure that you give us an

upvote love the comments there’s been a

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and we will see you guys back here the

next time