Good morning, folks. Welcome to another week of the sense of things with Ron and Jeff. And once again, we are in a wild

and woolly crazy week. Ron’s going to cover some of the just I would say consumer issues and things like that.

I’m going to talk a little bit today about what’s affected the markets over the last week and where we think we’re going at this point. It it’s anybody’s

guess and it’s the summer. We have time periods where there’s not a lot of people around in the markets and the markets move all over the fence. So stay

tuned. We’ll be right back on in just one second.

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

Good. It happened. You want to know what happened? Huh? We surpassed 40 40 trillion in debt.

Wow.

Just in time for interest rates to be going through the freaking roof.

Yep. A trillion a month in interest payments.

Good god. It’s just amazing. If if we ran our lives like the federal government runs, the business side of things,

I got to tell you, forget about politically, all the Fox wasn’t as scathing, but

CNBC, Bloomberg, all they were all basically saying, “Yep, nobody’s talking about in Congress, you know, nobody’s so if

they’re not talking about it, how can they do anything about it?” And and and they just had another bond auction today. Yeah. Amazing.

But earlier in the week, and we’ll talk about this with interest rates, of course, the the Treasury came in and did a big buyback operation to pull interest

rates back down a little bit, but it’s like putting a band-aid on a gaping wound, it’s just not going to help in the long run. So, until somebody gets

serious about this and we get we actually hire some adults to run our government for us, it’s well, it starts at the top. The

president has to talk about it. The last four presidents and the current one has not talked about it. No, they don’t want to because they have to keep printing money. They have to do it.

So I absolutely what’s what happened this week in history.

Couple of interesting things 1909 the first race is held at Indianapolis Motor Speedway. I think we

talked about this that if you’ve never gone, you should go and definitely go to the museum and watch the movie that they show, the little documentary about the

speedway and when it was built and how it was built. It was very interesting. But I love that stuff.

I can’t wait for this weekend, too. They got the Indie car race in in DC, which is going to be pretty cool. The the 250 one.

Yeah, I’m sure that’ll be good for traffic. Yeah. 1911 blazing fast around the world.

telegram sent 66 years before Voyager 2 was launched. I thought it was interesting the telegram and remember

the telephone was just just you had one telephone per neighborhood like you had to borrow it and then obviously it went

from there. So I thought that was pretty interesting. I know Western Union is still around but when was the last time someone received a telegram?

Yeah. Yeah. when you’ve got email and you’ve got everything else out there.

And yeah, I know it was still going in the 60s, maybe early 70s, but it had to have petered out by the late 70s or 80s, but

maybe we’ll do that for next pub next week. We’ll see. Yeah.

1911, the theft of Mona Lisa’s discovered. I never understood art theft.

Yeah, there’s only one of these. Who are you going to sell? Who are you going to Yeah.

And there was just a big theft this week in Italy, like four Renaissance paintings. Where do these go? Some

underground weirdo that wants wants this in their collection. And what do you do?

You just put it in like a locked hidden room someplace and you go look at them when you want to look at them. But yeah, look, being a movie guy, I’m not

crazy about the majority of sequels that have ever been done or remakes, excuse me, remakes. But I will tell you the 1999

Thomas Crown Affair with Pierce Proden and Renee Russo was excellent. And if you go back to the first one sucked,

but the remake in 99 was excellent about the art theft and he knew it was just for the glory and for the the chase of getting it. Great flick.

Basically for me, any Pierce Brosen movie is fantastic. So, I mean there he’s just he’s such a great actor and he’s just got that kind of fun wit

about him that it’s just funny. If you haven’t seen Rene Ruse was at her peak, too. So, if you haven’t seen the Thursday Murder

Club, which has got some of the greatest actors in it, I think it was on Netflix or something like that. It is phenomenal

and it’s just it was one movie and I think they’re trying to do another one, but it’s him and oh god, I’ve been

trying to think Helen Hunt. It’s just or Helen Mirren and stuff like that. It’s just hilarious and they’re so good together.

Yeah. Okay. 1920 19th amendment ratifies thanks to one vote to give the women the right to vote. And I think this is so

funny considering where we were in the first 120 years of our country abolishing slavery and everything else.

But no, women can vote up until 100 years ago. And here’s the crazy thing. I gotta dig into this. It was only

ratified by one vote. Like Yeah. And there were still people that didn’t want it. I just don’t get it.

No. And we were last one of the last countries in the world to allow women to vote. It’s just ridiculous.

If you remember, we had an episode about six months ago that remember there was a lot of women moving to Wyoming because

Wyoming gave birth to vote in that state. Sure.

Crazy. All right. 1957 I remember hearing this story by Richie Ashurn.

Philly fan gets hit twice by a foul ball by Richie Ashurn. So the here’s the quick story and he’s told this on the air. God bless him. He died almost 30

years ago. So he hit so he was a lefty leadoff hitter. He was prime. It took him way too many years to get into the

Hall of Fame and he hit somebody in a foul ball. Broke their no nose while they got a towel on his face going out.

hit another foul ball and broke his leg.

So, it was one of those take that and get the hell out of here. Don’t come back.

No. my one of my favorite baseball guy and I’m not a huge baseball fan but I went to a Rangers Oakland A’s game once

and this is when Reggie Jackson was playing and this one guy the guy we were like on the third base line and good seats right

down by the field and this one guy was just laying into Reggie Jackson just yo you you’re terrible like that and the

crowd kind of got quiet for a second and Reggie just blasted and hits a foul ball and this thing lands literally within

about 2 feet of the guy and next it’s dead silence and all of a sudden you hear

I’m like Reggie was that good that he probably won in every crowd.

Yeah. And he probably pulled that one off just for that purpose because he was that good of a player.

1991 Soviet hardliners launch coup against Gorbachov. Yep. This was what, a year and a half after the wall came down. So,

yeah. And look, they’re they’re still there. It just I think they’ve strengthened quite frankly since that time period.

1994 DNA links OJ Simpson to the Simpson Goldman murder.

And there was a this is how this is how they knew it was him. One in 170 million chance there was another person that

would have the same DNA. So, that’s why they had to go with doesn’t fit, you can’t commit on the glove. And but the whole idea was

that’s why it had to be planted because there was no they couldn’t dispute the DNA evidence. Of course.

98 President Clinton testifies before a grand jury on the Monica Lewinsky relationship. They almost impeached him.

It was close, but no cigar. There you go. All right. That didn’t happen either, by the way. Yeah, that that didn’t happen either.

Okay. None of that happened either.

Yeah, sure. She said it did. 2004, Michael Phelps wins eight Olympic medals in Athens. The man was amazing. He I

don’t know how many of those were world records and of course they’ve all been beaten. I it just it’s amazing how some of these records that are just shattered

like Katie Katie Leiddki on the women’s side and then all of a sudden now she’s being beat. So I don’t know what the difference is.

It’s amazing to me that just over time people Yeah. It’s just they were just talking about the one

mile time is now sub 3.5. It’s like 343 or 344. It was by a tenth of a second

like Yeah. And Roger Bannister, it was like shocking that he beat the four-minute mile and they’re already a full minute shy of that which is insane.

Yeah. Okay, so here we go. bunch of charts here all surrounding the consumer

and started out the episode of course bitching again about the the debt reaching 40 trillion now we’ve showed similar charts like this in the past and

for the most part yeah not good go this goes back 25 years and it’s ticking up

and you can see you know the the red and the orange this is severe der derogatory well past 180 120 so it’s probably closer to 180 for never paid. Not good.

Yeah.

Obviously, if you’ll take a look at prior, this was the financial crisis and obviously we all know it got bad. Came down following COVID and then obviously

we’re ticking back up again. I know we keep we’ve said this before at some point this will mean something, but then

just looking transition into delinquency by loan. Now, this was interesting. I thought the student debt was just going

to get crazy because if you think about it too, look when it started to come

down. This was past the the point where the forgiveness not not the forgiveness of the loan but the the abatement the

delay on the loan payment. So I thought that this was interesting but just could look at it the right credit card is

still high. It remains high not only past 30 but past 60 by past 90 days too. What are your thoughts on this?

I think it’s interesting that student loan debt is literally is the highest most of the time, you know, which tells

you that you look at what that period of time is when it’s when it really has become the

highest is right around the time that the government decided to get into the student loan business and booted all the

private loan lenders out. Yeah. How has this worked out for us? Thank you, government. You haven’t helped. All you’ve done is raised the price of

education because basically they can do whatever they want because the government will backs stop it and now you’ve made it the highest amount of

delinquency of anything. And you wonder why all the socialists are winning because you got all these idiots that went to college and spent a fortune on

college to with the government saying, “Hey, you can do whatever you want.” And now they don’t have jobs or they don’t have jobs enough to pay for this stuff.

And I find it interesting if you take a look on both charts, the purple and the gold line, right? That is the mortgage and the home equity revolving credit.

Now, obviously, if we remember 21, 22, and even 23, 21 and 22 were at an all-time low. So, you of course the delinquencies were going to go down.

Yeah, but they were. I don’t understand why they’re ticking up both 30 and 90 days a little bit because if you refinanced at

a lower rate and couldn’t afford a sub3 or a sub4 mortgage, what the hell you

How do they even get that in the first place if they’re not even paying it? I don’t understand.

But I here’s how I would read that is you also you remember people were wildly

overpaying for their houses during that time period. So, yeah, you had low interest rates, but people were wildly

overpaying. And now the markets have come back. I That’s what I hear in our market here is, I can’t even get what I paid for my house. Yeah, dummy. You paid

150 grand because you had to have a house and you had to up the size of your house because the market was going up.

Eventually, it comes back and they can’t get out of those houses. Now, that’s the challenge is they can’t sell the house

because it’s they paid 150 grand more than they were supposed to.

Yeah. And then just wrapping up here to just have more good news for the day. So, I I thought this was shocking.

Consumers saying, “Now, look, this is a survey, so obviously the results can be skewed, but I they do take that into

consideration, too. How is this at a 70-year low or near a 70-year low? I find this to be quite shocking

considering what the stock market is and the wealth effect.

Yeah. I think once again, and we’ve talked about this before, I think when you have the media, the vast majority of

the media is just pounding on this. Oh, everything’s unaffordable. Everything’s horrible. Oh, business is terrible.

It has to have an effect on that. But people still keep buying stuff. the service businesses all but Walmart today

and I haven’t really read the details of the Walmart call. Target was great. Home Depot was fantastic this week. So, people are buying. They may not be

buying as much, but they’re still buying and they’re still voting with their with their paychecks and everything else. And as

long as people have jobs, I think they’re just going to keep spending money, but they’re going to feel, “Oh, it’s so horrible and it’s terrible about it.” Yeah. And look,

small business is what runs our country, right? The majority of businesses have under 100 employees and they’re at an

average for optimism. You know, if you’re looking back at the last 50 years, they’re at an average. So, it’s not

it’s horrible. It’s not overly optimistic and euphoria, but here we are. We’re about average. So, the numbers don’t correlate.

Yeah. And we as small business owners know our costs are going up and everything else that I I know as a small business owner my cost from everything

from insurance to the drinks that we provide to our members here and my co-working space. All of that has gone

up over time, but it’s also come back a little bit. Our It was funny and I do it from this perspective. This was like a

big stock up month for us because we hadn’t bought a lot of supplies during the summertime. And so this was like a big Costco run for us. And I’m like, my

head is completely around, okay, this is going to be about a $300 run cuz we had to get everything and all this. And I

get to the we check out at Costco, next thing I look and it’s 175 bucks. And I’m like, it hadn’t been 175 bucks in years.

I can’t think back five years from now.

I’ve had a 300 $250 to $300 bill. So, it’s come back. A lot of this stuff has come back. It’s just once again when you

have the media just pounding on this stuff. Oh, that prices are unaffordable.

They’re People don’t realize it, but my bills at the grocery store when I go are not what they were a couple years ago.

Mine have gone up.

Yeah. Yeah. Because you buy steaks every day and you get you buy steaks with the little gold leafing on top of them. I mean those of us we buy we buy pork

chops dude I’m talking eggs have come down a little bit but I’m talking just fruit has gone up. Yeah.

So you know I’m eating healthier. I’m getting encouraged.

That’s it. So not have a steak with gold leaf on it. Have some have an apple. You know bills will go down man. I hear. All right. What do you got?

All right. Let me go through this real quick. Had my had my trading AI put together a little thing for us today.

Give me just a second if I can see where the share thing is. It was hiding behind the screen here. All right, so let’s

take a look at this. What really affected the markets this week? It [clears throat] was the bond bullies, quite frankly, that that led the pack

this week. You know, the markets for the last couple weeks have spent two weeks betting on Fed rate cuts and what’s the Fed gonna do and what’s the thoughts?

And of course, we had the the notes come out or the the minutes come out from the Fed and there were three denters that

felt like we just need to raise interest rates and that’ll bring inflation down, which is the stupidest thing I could ever think of, but that’s what they

think that’s caused. And I think it’s been interesting from my perspective of the Kevin War the difference between the

two Fed chairman because Kevin Morris kind of came in and said, “You know what? We’re not going to tell you what we’re doing. You got to figure it out.”

And I think the bond market just hasn’t quite figured that out yet. But this week, we saw interest rates yields on the 30-year surge up to 5.33.

The 10-year 4.77.

The 30-year is really a com a competitor to b to stocks. So seeing that go up, this is the highest rate since 2007 on

the 30-year. Seeing that be that high, that just tells you that we are the expectation is inflation and it’s a

competitor to stocks and I think that’s why you’ve seen the stocks kind of pull back a little bit. Specifically, some of the big highf flyers. the 10-year has a

massive effect on the the mortgages because that’s what the mortgages are based on. Whatever the Fed does has absolutely nothing to do with these

rates. These rates are set by the market. Now, we did see the Treasury step in a couple days ago, do increase their buyback program that pulled rates

back yesterday, but it could be a band-aid on a gaping wound at this point. And of course talking about what

we talked about at the beginning 40 year or 40 bill or $40 trillion budget and debt at this point okay with rates

higher when we do bond sales they’re at those higher rates and that means we’re paying more and more money every month to to cover that debt.

While this matters to us with safe bonds at 5%, risky stocks are not necessarily something that everybody wants to be in

at that point. And even yields are not where they were. Yields on or dividends on stocks average about 2.7. So if I can

get 5.3 versus 2.7% on a dividend, I’m probably going to go with the lower risk investment at that point.

Obvious the bond market is what drives everything. Obviously, and the bond market is, I don’t know, five to seven times bigger than the stock market. Oh, yeah.

So, in the end, people aren’t paying attention to that. They basically are being blinded or they want to be blinded to what’s really going on.

Yeah. When the bond bullies are beating up on the market, it is one of those things that you have no control over.

And it doesn’t necessarily mean that the stocks you own are bad. It just means that the stock market isn’t pricing or

you know the stock market is pricing that in. What we saw this week is definitely AI and chips get repriced.

Some of the big names, SanDisk, Micron, Credo took some big hits on Tuesday and Wednesday of this week, mainly Tuesday,

Monday and Tuesday. And it’s not a company problem. Once again, it’s a rate problem. So higher rates hit those long

duration stocks more than they do. And when you think about it, did money just go to cash? It really didn’t. They

didn’t. People didn’t jump out of the market and the big players didn’t jump.

It was money rotating into areas like healthcare and energy. One of the the biggest things yesterday and honestly it

was a big thing that really I didn’t hear a single a couple presenters talk about early in the morning and that was

about it. But Madna and Merc found a cancer vaccine breakthrough and Madna was up 90% yesterday. 80

crazy the biotech stocks the everything from mega large cap, midcap and small cap were all up 6% plus yesterday.

Yeah, which I look at my own portfolio for clients and I’m like I’m glad we shifted a little bit of that. I was guessing I was secondguessing myself

early in the month, but it’s yeah, it we’re really seeing that shift out, which quite frankly, I think that’s a good thing. I’d rather the market be

broadened out a little bit instead of just in the big AI stocks that are back and forth and up and down and everything else. Once again, seeing that, seeing a

little bit of the industrials and things like that, which I think it’s good. This is not a recession. This is a repricing.

Some of the biggest things of course with President Trump is love him or hate him. He moves markets and a bunch of the

stuff that he said this week has moved markets. It’s pushed oil up. Bitcoin jumped up interestingly because they’re trying to really push hard on getting some of the legislation done on that.

And of course this week Walmart today came it’s down about 6%.

Not so great forward earnings or expectations but Target and Home Depot had beats. Now the market looked at that

and went n there. I think the one real strong thing came in today. Philly Fed was at 47.4

versus 25. and we had another kind of what I would consider now average jobless claim. So, this isn’t a

recession scare. It’s really just more of a hey, the market’s kind of repricing and readjusting itself. I think it’s good time to take a look at your own

portfolio and say, okay, am I way overexposed to the real high beta stuff and maybe it’s time to make some

adjustments or diversify your portfolio out.

Yeah, I don’t know what gas is. I know it’s cheaper in Texas. filled up last night. I use plus 89 octane. 505 a gallon.

Yeah, we’re like I think that here would be about 405 I think. Regular unled.

Once again, because I don’t have a goldplated car, I just use regular unled.

Yeah. Then I put all my steaks in. Yeah, sure. Yeah, you put your steaks.

Actually, I don’t put the steaks. I just buy the whole cow, go home, and cut them up.

There we go. And that’s it. And I use the I use the biodiesel from your cow. I use the bodies. Sure. I’m sure. Yeah, I’m sure in my truck. But but yeah, it’s I think our regular unlet is 380 or 350 here.

I think we got the Jackson Hole next week. That’ll definitely move markets.

So, I think we’ll have our podcast right after that. So, it should be interesting.

Yes. Because I am riveted by the Jackson Hole conversations for whatever reason. It’s a market mover.

Exactly. Folks, thanks for joining us here once again. We do these for you.

So, if you have any questions, feel free to shoot those into our comment section.

Please give us an upvote if you can because we appreciate that. And subscribe to the channel. So, we’ll talk to you guys next week and we’ll talk

after Jackson Hole. I’d rather be there in the instead of 100 degree Texas.