Investor's Edge with Gary Kaltbaum - The Holiday Week In Review

Episode Date: December 23, 2022

Follow Gary on GaryK.com or http://garykaltbaum.com

Investor's Edge with Gary Coltbaum. Straight talk about you and your money. Now from the BizTalk Studios, here is Gary Cultbaum. And welcome once again to Investors Edge. I'm Gary Coltbaum, your host day. Thanks for being with us today. Glad you here, ladies and gentlemen. Happy that you are listening.

It is, as was just told to me, the eve of Christmas Eve for those who are celebrating. Happy Hanukkah, Merry Christmas, whatever you celebrate, the best to you and yours and your family, healthy, prosperous as we head into the end of the year. And I hope that you've heard when I have said a great time that if you have the opportunity and you have the wherewithal to think about doing something for somebody, you need absolutely nothing from. Just something to think about. Okay.

As you know, this is a show that guides, guide you through the morass of the markets and the economy and jobs in unemployment and taxes and deficit spending, scams, shams, corruptions, the economy, you name it, we cover it without any bias, without any agenda, without any ulterior motive. We lost all our love for them. throughout the years they've earned it. We'll do a little bit of them later in the show. But I want to hit you between the eyes at the outset. We've got three days of a weekend coming up, and those that do what we do actually scan the markets, unlike the, oh, we're going to buy you 100 stocks,

and we're just going to sit there while you're down 40%. We actually measure the tape. We actually time things. We actually have proven to you that we know what the hell we're doing. So I'm going to hit you between the eyes, right from the get-go. And I want you to listen carefully. We're going to put out to you an if. You know an if.

The if is going to be based on facts. We're going to give you if, and we're going to give you facts. The facts are based on what's already happened, what's already happening, what things look like at the moment. If, if the NASDAQ, the NASDAQ, the NASDAQ 100, the Russell 2000, technology, slash growth, if the NASDAQ, continues to underperform in the fashion that has underperformed. We believe it is our opinion that there's one heck of eventuality, that there is going to be another leg down, and it's going to be a doozy of a leg down in the NASDAQ,

the NASDAQ 100, the Russell 2000, the growth, the tech types, the good news we do believe on the other end of the spectrum. A lot of stocks have seen bear market lows. And that's not a reach because there are some stocks that have rallied nicely since the low on October 13th. We're just letting you know we cannot continue to have days like today, which was actually an update We cannot continue to have days. Where I say to you, the Dow was flat, but the NASDAQ was down 150.

Or the Dow was up 170, but the NASDAQ was only up 21. Where on an up day, we say, by the way, today there were no new yearly highs in the NASDAQ, but there were 212 new yearly lows. Why are we telling you this? It's pretty simple. The NASDAQ? the NASDAQ 100, the Russell 2000, the technology, the growth arena are your risk appetite indices. They are a characteristic of importance. They are a place where when the money flows,

it tells you the juices are flowing. The risk appetite of the big, institutional, the big money crowd that moves markets, it defines their feelings and their movements. Examples sell tech by Johnson & Johnson. Sell growth by travelers. Sell high beta stocks by Procter & Gamble. That's what we mean. Throughout history, listen carefully. These are negatives, ultimately negatives, not necessarily today, but ultimately if nothing changes.

And another day today, where throughout the whole day, the NASDAQ was only lifted up by the rest of the, of the market instead of leading the rest of the market up. We would rather see the Dow flat, the NASDAQ up 80. The Dow down 100, Nasdaq up 10. The Dow down 200, the NASDAQ flat, if push came to shove. So when we give you out the numbers again today, I will tell you before the close, 15 minutes to go. I think the Dow was up 100 and the NASDAQ was down.

Again. When the Dow had some trouble in the morning, the NASDAQ was down 90 when the Dow was just down a little. And we'll give you out the final numbers in a couple of minutes. But this is Muay and Portante. Most people don't know what I am telling you and wouldn't know what the hell to do with it even if they did. Most people don't even pay attention to this. This is our edge. This is now your edge.

Continues to be your edge as we've been harping on this for quite the while. So we give out the numbers again today. It's stunning. We're actually surprised about how wide the spread is between the growth arena, the risk on risk appetite arena, versus the what we call, I want to use the word boring, we'll call the most liquid low beta, meaning does not move around with markets. And we're going to be watching closely, not only for us, but for you. What you do with it, you get to decide. We don't move your money.

we just tell you what we think. We just want to let you know again, another day, where if the Dow was flat today, we think the NASDAQ would have been down 100. Think about that. We're saying if the Dow was flat today, the NASDAQ would have been down 100. Now, we'll give you some other sector things.

We told you in the last day or so, oils were getting a little bit better. They had another good day today. Still nothing really rolling, but recovering. And we'll just go tit for tat. We'll have some news of the day, some thoughts today, and whatever else we can think of. But we just wanted to hit you between the eyes. Just another day.

They can't move the growth arena even if they tried. And to repeat, wow. Wow. A big wow. And this has been going on for a while and has really accentuated itself since October 13th, where the Dow has put in a nice sort of kind of V shape until it started pulling back in the last couple of weeks. And the NASDAQ can't even budge off the lows. That'll be up next. Much more. This is the one only investors end. hosted a nationally syndicated radio show Investors Edge. We're not just handsome radio people. We manage investors' money for a living, specializing in fee-based discretionary money management. No big commissions, just a fee on the assets that's managed.

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Investors Edge. The last bastion of quality programming. With Gary Coltbaum. It doesn't get better than this. And look once again to Investors Edge. So, the market wrap is brought to you by Investment-Dashmodels.com. That's Jim Moraback, one of the great market timers.

No gray areas with the man. You're either in or out of the market. As proprietary indicators, go check them out. investment dash models.com. Remember what I said. When the Dow was up 100, the NASDAQ was flat. Well, the NASDAQ finished up a whopping 21 points today. The Dow was up 176.

I can promise you, in the bull market with the Dow of 176, we'd be up 90 NASDAQ, if not more. That's what we mean. And let me repeat, I have certain quotes of, other people and quotes that I made up. One of my favorite quotes that I made up, the edge we have is we know things and see things that most everybody do not know or see, and even if they do, they wouldn't know what to do with it.

One of the most important parts of the market is to measure risk appetite. of the big institutions. And what are they doing with their money? And we've used the example. Let's go over it again. We have said to you many a time, how do these big outfits work, these mutual fund companies, these hedge funds?

I'm just going to give you a general. Well, they have investment policy meetings with portfolio managers. and they sit down, and they look at their returns, and they see what they own, and they go over it, and constantly they're trying to adjust to the markets. Now, there are those, like the Warren Buffett that owns a bunch of companies. He ain't moving them. But I can promise you, the movement of hedge funds and mutual funds,

is a bunch. How do you think you get 90% drops in Peloton? Overowned at the highs? Now hated by all. What's the reason why? Price crushed. So what they do in their meetings is they have the analysts in there and the analysts are walking in and they're talking about, holy crap, let me show you this chart. central banks increase in liquidity look what made moves to the upside central banks decreasing liquidity looks what's moving to the downside how much we own of this stuff moving starting to move to the downside get the hell out of more markets bearish we have to be almost fully invested how can we protect as much as possible well let's look at this this is what they are doing we can park our money in this that and the other thing why because look what happened in oh wait look what happened in 2000 look what happened in 74 these are the things that held up best during the

bare markets and of course it's what we're telling you and that's where the movement comes but there's also a rhyme and a reason why do you think facebook stock has been crushed why do you think it topped out. Well, it topped out many months ago because a couple of things. These big institutions recognize the market was turning, that the Fed was laid on inflation and they had to play catch-up. And if they did and they start raising rates and markets don't like growth stocks, if they start raising rates and interest rates are already moving up and valuations are in the trees, let's let loose of some. And then Facebook and January. January, the first coughing up, bad earnings, gaps down.

That day, the company and stock disappointed in a very big way, but was still at $230 bucks on the open, down bid. What do you think all these analysts are doing from these portfolio managers? They're on the conference call. And they're pissed off because Facebook never gave them good guidance and the stock was crushed. and what do they start doing then? They start questioning. They start wondering.

They start thinking, maybe just maybe, something up here. And then they start taking deep dives. And they start looking at Facebook and where revenue was growing 30, 40, 50 percent. Now it was only 20 percent. Earnings up 30, 40 percent. It was down five. And what is their deep dive? show them that it looks like a trend's going to be starting but they own so much stock they have to be

careful they don't want to sell too much what do they do they start feeding the market and feeding the market and feeding the market and getting out as much as they can getting out of the way and instead of owning 50 million shares they get down to 10 million where they feel better and they sell it 230 average and now it's 118 because they were right and how are they able to figure these things out because they're smart these are not dummies and they are very good at flushing things out they have great connections they have great connections with the vCs the private equity companies what's happening on the ground with companies like facebook is advertising getting in trouble, are they losing more and more teens? And boom. And we're just using one example. And of course,

if it happens in one, what do you think about the industry? Then they have to start thinking about the industry. And then they start looking at other companies that make a lot of money because they have faces and people at their app. And they're making a ton of money on the advertising. What happens to the other stocks? Oh, they're going to go along for the ride. Well, that's what's going on now, kids? This big money crowd has no interest in owning growth based on whatever the reasons. They had a huge run. Interest rates that were zero and now 3.75 on the 10 year and the fours on the lesser

yield curve, lower yield curve. Earnings and sales are down. companies got too big Apple's got a two point something trillion dollar market cap how do you grow that thing or everybody bought so many PCs and laptops during COVID

that they ended up with so much inventory and they can't get rid of them because people don't need to buy them anymore because there's too many out there you catch in the drift so all we can tell you as of today nothing changed on that front

Up next. We'll have more on that. Importance. I'm Gary. This is the one only Investors' Edge. America is talking. Investors Edge. He's got to be pleased with that. The crowd is just on its feet here. He's a Cinderella boy. With Gary Colbomb. It comes highly recommended. You're going to feel better if you talk to him.

Before we get back to what we're talking about, they pass the $1.7 trillion monstrosity. These dirt bags in Washington, D.C., continue to disrespect you and I. They're just, here's the deal. You ever go to a football game and somebody has one of those big fingers? It's an index finger, though, that big gigantic styrofoam finger, you know, Washington's given us the big gigantic styrofoam middle finger. And they don't care.

We're nothing. They've used D.C. as their own little bank. to please themselves and gain re-elections. And, of course, so many call for term limits, but guess who votes on them? They do. Next, the IRS has now backed down. I just want to let you know. They are postponed.

What they were going to do, and this is nauseating. Remember how I said to you that they audited the Pentagon and they're missing trillions of dollars of assets? and they've not even looking at it. Well, they wanted to go after us for $600 bucks deals on Zell or PayPal or stuff like that. Well, there was a lot of confusion on it, and it's just plain stupid. They should not be doing it.

They are backed down on it, and they are postponing it. My guess, it's not going to happen. I think they probably heard from plenty of people. As of right now, they're just calling it a postponement, but that means for the next year, you won't have to worry about that. And that means if you sent 600 bucks to your son who's in college or daughter,

you won't have to report it to the IRS and vice versa. But you should be reporting it if it's based on business. If you've got something through PayPal and it's based on business, you should report it. You're not going to get caught if you don't, it looks like, but I would report it. You've got to do the right thing. Next. The other day, I did a nice little talk about Gary Kane of the Boys and Girls Club's of Central Florida, how it really is one of my inspirations. I have to tell you, and he doesn't know it, and I never said it to him, and I just, you know, I've never had to be able to spend enough time with him, mostly in studio.

I got to be on TV with Neil Cavuto today. I think it was 2002 when they asked me to be a contributor, and I'm amazed they have continued to keep me as a contributor for this long. He doesn't know it, but he's another one of my big inspirations. And I'll tell you why. First off, as I always say sarcastically, when I catch a cold, I whine like a baby. And I usually say that when I'm discussing somebody that goes through hell.

The man, and this is well known, I'm not saying anything that's not well known. He's got MS. And I have other friends that have MS, and it's debilitating is all hell. And there's different levels of it. But it's never stopped the man at all. Works like a dog. he's had cancer I open heart surgery

he had COVID pneumonia where he was in pretty bad shape months ago and yet after all this and with all this works his tail off and does it better than all

seriously and he's handled himself with grace with class, and I bring up something that I noticed that's not talked about enough. Throughout Trump's four years, Neil Kavuta would compliment him plenty of times, plenty of times. He complimented him on tax cuts. He complimented him on the economy when the economy was strong.

But Neil Cavuto also does something that, unfortunately, a lot of other journalists don't because, as I have said to you, so many are just in the tank. You know what I mean by the tank. Their side. Well, it took one time where he brought up President Trump and said to the effect of lying, which President Trump is very good at. One of the things was, and I did too. One of the things was, oh, tariffs are paid by the Chinese, which is a just blatant lie, amongst several thousand other lies. All it took was one for Trump, the Eddie Haskell of politics, you can go look that up, to start ripping on Neil Cavuto. And in case you don't know, when Trump would rip on anybody, oh, would they catch hell from the,

extreme Trumpian side. And what did he do? Didn't attack like others would. Just handled it with class, handled it with grace, moved on and kept doing his job, calling balls and strikes. Simple as that. In a industry of journalism right now where people are on teams. What have I told you? On one side, on the left, if the left does wrong, it's not reported. If the left does right, 24-7. On the left side, if the right does wrong, 24-7 colonoscopy. If the right does right, doesn't get reported. And vice versa. Neil is rare. Britt Bear on Fox News is rare. and there are others. The good news is there are others,

but they're becoming more rare. And I'm appreciative of this man. I just wanted to let it know, let it be known. He inspires that whatever life hits you with, you hit back. And he works every day

to provide unbiased, straightforward, news and by the way he's brilliant too so i just wanted to bring that up because every time i go into studio and i get to see him he doesn't recognize this it's a thrill and i've been doing it for now i think 20 years and by the way how do i know he caught you know what when trump went after him i saw the i saw the tweets i got the tweets you know when i tweet i'm on his show and say the brilliant Neil Cavuto, I still get tweets to this day from Trump people. I'll never watch him again.

Anyway, that's my take on that. And I'm on with him again tomorrow, by the way, but remote. If you turn on Fox News tomorrow, he's on live from 10 a.m. to noon. I'll be on the 11 o'clock hour. I think around 11.30. And we discuss whatever he wants us to discuss. And there's a lot of things going on, right? Okay, circle back.

We must circle back. If the NASDAQ does not get going. By the way, what do we tell you yesterday? At the lows yesterday. Yesterday at the lows, it was only five points higher than the closing bear market lows. Stunning. Amazing. and all you got to do, go look at a chart of the Dow, and then go look at one of the NASDAQ.

Go look at one of the NASDAQ. Again, stunning. Go look at something called the XLK. Go look at something called the IGV, which is technology. We're just letting you know. We think there is a shelf life on the parking of money into the Dow Tau. which, by the way, the Dow held the 50-day moving average yesterday after undercutting it intraday. If the market comes after those areas, NASDAQ's going to break.

And we think a chance of breaking badly. So stay tuned. We'll be on it. Listen up. If anything changes, we will let you know. But as of today, doubt 176, the NASDAQ and muster a whopping 21.

Up next, what else is going on? This is the one and only investors edge. We're listening to. What are we waiting for? Well, what are you waiting for? One, two, ready, go. Action! Investors Edge.

With Gary Culpa. So I'm just looking out at a little video. I-75 in Ohio mass casualty incident on the road, on the highway, just a mass pile up. I guess there may have been a whiteout or something. Man, I wish people would, you know what, I can't say that because people have to get to work or go to work. But man, people got to be careful on the roads when you hear about what's going on out there. I'm here in New York City. The weather's going from 55 high in.

day in the couple hours it's going to be 10. I saw snow earlier, but it was fleeting. And I hear in Orlando tomorrow, it's going to be 20 degrees in Orlando, Florida. Yikes! Stay warm. Stay off the roads if they tell you it's icy. Don't tempt. You got that?

Risk management. Remember that? How I've told you about I'll never skydive. That's risk management. I posted a video, Tom Cruise, do you know he did 60 skydives in a day for, they were, you know, testing out for his new Mission Impossible movies? He did 60 in a day.

How old is he? It's got to be like high 50s, right? I won't even jump on my bed. Risk management. Okay. Oil's had another good day. today. Yesterday we told you they're starting to show up on the screen a little bit. Oil prices going higher. Of course, I do think it has to do with the cold weather. But all I can tell

you is it was a good day. I'll be scanning them tonight. Nothing's really going. They're just recovering and we want to see just we're always looking for things to recover and break out a range and haul you know what to the upside. We're just letting you know they're back on screen and we'll be scanning them a little more closely. Good. Just an overall good day for what we call the stuff. They bounced the retail. They bounce the transports. Not much. They bounced the economically sensitive.

Not much. They bounced the financials. Not much, but they bounced it. But what they did not bounce is I look to my left here. It's mostly red in high beta growth land, you know, the software types. It was a red day in solar. It was a red day. China related, you know what we're hearing?

in China? As you know, they have gone from just shutting everything down to I think they're never going to say it, but no choice who better open up. The rumor is a crap load of people are getting COVID because they don't have immunity. Number one.

Number two, there's uncertainty about their vaccines. And number three, I mean, think about this. We're hearing and they're not reporting a ton of death. It's being reported. This is third hand. But man, oh man, is it possible they did everything wrong? Locking people up.

I don't know if you know this. They locked people up. You could not get out. They sent drones over traffic. And if you didn't have a patch on your windshield that said, I guess, green, they're sending you back. If you're in the airport, you got COVID, they stick you in a sealed container, for lack of a

better word, and haul your arse away. But it's been killing their business. If it's been killing their companies, it's been killing their market. So they backed away. And as you know, we've been highlighting how the China stocks have had good relative strength. but today not so good because there's like some video coming out. We'll keep you abreast of that situation, but dang, we, I must tell you personally, I don't have trust in China stocks now.

Not to say I won't in the future, but you wake up every morning. What are they going to do next? Who are they going to attack next? You know, they sent their educational Chinese companies down 98%. they made it know they shouldn't be making any money to be state owned and they backed away now they moved higher but i just wonder so we'll let you know if we ever get trust we may never get trust again you do know what's going on there it's communism run amuck again repression run amok you say something bad about the government you're gone they're jailing people for

People are missing for saying bad things about the government. Go read about Jimmy Lai, L-A-I. Look up Apple, The Journalist. He had this Apple newspaper that go look it up, what they've done with this guy. They railroaded him, just like the Brittany Griner in Russia. He didn't do anything wrong. They just made up charges. This is what's going on there.

Unfortunately, Hong Kong, a great business hub, is in the crosshairs of them also. So I'm just not so sure of that. Leadership, you know, I got a few new highs in the market, a couple of food stocks, yeah, and New Yearly Lowe's have picked up. And again, to circle back,

it's the boring low beta doubt types, which is fine and dandy. We're not indicting them anything. We'll just let you know it's a characteristic of a market to be in trouble. How do we know this? We've studied every bull and bear market. And the one consistent theme is when risk on, risk appetite areas are underperforming.

That is troublesome. And let me state for the record, they're underperforming woefully. Growth funds are gross. Investors Business Daily has their investors business daily 50-50. Gross. Their mutual fund index, gross. High beta growth. Mutual funds, gross.

That is your risk appetite. That is your risk on. That's going to be a must to change. We'll keep telling you what's working in low beta land, boring land. Based on history, we just think there's a shelf life. You all have a merry Christmas.

Happy Hanukkah. Have a great three-day weekend. Don't forget tomorrow will be on Fox News. 11 a.m. out, Neil Cavuto. Monday will be best of Gary. Until we're back live Tuesday, again, have a great three days. Stay safe. Stay off the roads if it's bad.

And when you get home, very simple. Make sure you hug your children, hug your family. Hopefully you're getting some good presents. Have a great evening, everybody. Have a great weekend. Good night. Bye-bye. This has been Investor's Edge with Gary Cultbaum on BizTalk. To listen to past episodes or to get in contact with Gary, go to GaryK.com.

That's GaryKK.com.