Rich Habits Podcast - Pope Against AI, GDP Revision & Market Updates From Ron Santella

Episode Date: May 29, 2026

In this week's episode of the Rich Habits Radar, Robert Croak and Austin Hankwitz walk through the April PCE, the Q1 GDP revisions, and the Pope's critical comments on AI. We also sit down with the legendary Ron Santella of Equable Shares! Ron Santella joins us to give us a broad market update as well as answer our questions re: the bond market, the new Fed chair, and where HEDG best fits inside an investor's portfolio. 👉 Click here to learn more about HEDG and Equable Shares!---🌸 Join 500,000+ investors using Blossom to track portfolios, dividends, and see what real investors are buying -- all in one social investing app. ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Click here!⁠---🤖 VCX: the public ticker for private tech -- ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here or visit https://getvcx.com/ to learn more! ⁠⁠⁠⁠⁠⁠⁠---🤝 Interested in learning more about ETFs? Check out our friends at ETF Central! ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Click here!⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠---✅ Ready to start investing? Open a brokerage account on ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Public.com/richhabits⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ and get a FREE 1% match on all IRA deposits, transfers, and rollovers!---‼️ Have feedback to share? Please let us a comment on Spotify! We're excited to mold these new weekly episodes to be exactly what our listeners want. ---🚀 Join 900+ fellow podcast listeners inside the ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Rich Habits Network!⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ Unlock 8 hours of video course work, ask us questions directly, participating in exclusive weekly livestreams, and invest alongside us in pre-IPO deals. ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Click here!⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠---⚡️ Sign up for the Rich Habits Newsletter and never miss a market-moving headline again, ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here!⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠---⭐ Download our FREE Financial Planner –⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⭐ Download our FREE Budgeting Template –⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⭐ Earn 3.8% on your savings with a High-Yield Cash Account –⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⭐ Automatically buy stock where you shop with Grifin –⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⭐ Protect your family with term life insurance from Suriance –⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⭐ Use code “Spotify” for 15% off our 4-module video course –⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠---📬 Inquire about working together – [e-mail]---This content is sponsored by NEOS Investments. The creator is compensated by NEOS to discuss NEOS ETFs. This content is for informational purposes only, and is not personalized investment, tax, or legal advice, and does not constitute an offer to buy or sell any security. Investing involves risk, including possible loss of principal. Before investing, carefully review the NEOS ETFs prospectus at ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠neosfunds.com⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠.

You are tuning in to the Rich Habits Radar, our Friday episode of the Rich Habits podcast, where every Friday morning we're coming at you with the biggest headlines impacting you and your money. This episode is brought to you by VCX, the public ticker for private tech. My name is Austin Hankwitz. I'm joined by my co-host, Robert Croke. And the three things sitting at the top of our rich habits radar this week include the Fed's favorite inflation gauge hitting a two-year high. Q1 GDP was revised lower. and the Pope's recent critical comments on artificial intelligence.

And be sure to stick around to the end where we talk with our Wall Street veteran Ron Santella of Equable Shares to help us make sense of this historic rally that we've experienced over the last two months, Robert. Cannot wait for that conversation. So after the story's end, don't go anywhere. Robert, let's dig into our first story. Yeah, our top story today is the Fed's favorite inflation gauge just hit a two-year high. This morning, the Bureau of Economic Analysis released the April PCE report, the Personal Consumption Expenditures Index, which is the inflation metric the Federal Reserve actually uses to make their rate decisions. And the headline number is ugly, 3.8% year over year. That's the highest reading since May of 2023, up from 3.5% in March.

Core PCE, which strips out food and energy costs, ticked up to 3.3%. annually, the highest since October of 2023. So both the headline and the core numbers are moving in the wrong direction on an annual basis. And Austin, here's where it gets interesting. The monthly numbers came in softer than Wall Street expected. Headline PCE rose 0.4% for the month versus the 0.5%

forecast, a deceleration from March's 0.7% spike, and core PCE rose just 0.2% month over month versus the 0.3% consensus. Now, Robert, let's talk about that super core measure, which is the one the Fed officials obsess over because it strips out the food, the energy, and the housing to just show that pure underlying inflation. That super core measure rose just 0.1%. That's a very sharp cool down from the 0.3% rise we had in March, which is a good thing. So what's really going on here? The headline is being driven almost entirely by energy. Gasoline and energy goods surge 5.5% in April alone, on top of March's 20.9% spike as the Strait of Hermos disruption keeps pushing prices at the pump

higher and higher. Housing costs also jumped 0.6% for the month, the biggest gain in that category in over a year, and food prices also climb 0.5%. But underneath the energy shock, the economy is actually cooling. Transportation services dropped from 1.2% to 0.4% and financial services fell outright. Austin, a lot of numbers, a lot of things going on here. What does this mean for you and your money? Yeah, no, it's really, really important for us to keep tabs on the personal consumption expenditures index. Because like what you said at the beginning, Robert, this is what the Fed looks at to make those rate cut decisions. As you all might remember, we've been talking about this for months. when we started the year of

2006, the Fed was expected to cut interest rates by about 75 basis points, at least half a percent to 1 percent, somewhere in that range, three times. Now, the Fed is more likely than not to cut interest rates

zero times, keep it exactly where it is, and there's been some rumors of a rate hike. Now, as we look at the April PCE, which is what the Fed cares about, and you look at this 3.8% print, the Fed can't cut rates. But they also know that this is not demand-driven inflation like we experienced in 2020 and 2021. This is specifically an energy shock from geopolitical conflict.

Jerome Powell cannot drill for more oil to bring up supply and lower oil prices. Kevin Warsh cannot reopen the Strait of Hermuz himself. Raising interest rates would not bring down gas prices. It would crush the consumer even harder. That's why that soft core and supercore numbers, matters so much for everyone listening. If the Strait of Hermu's situation begins to stabilize and energy prices come back down even partially, the headline number begins to drop very fast. And that's when Warsh maybe gets a little bit of room to cut later this year or maybe early 2007 like Bank

of America is forecasting right now. So for your portfolio, the playbook from last week hasn't changed. It's actually gotten more entrenched. Higher for longer is the base case. It means company companies with pricing power and strong margins continue to perform, the Costco's, the visas, the companies that can pass through costs without losing customers. And if you're watching the housing market waiting for mortgage rates to come down, today's report tells you it's not going to happen anytime soon or this summer. The earliest realistic window for meaningful rate relief is still late 2026 at the earliest. So don't make a major financial decision based on rate cuts that haven't happened yet and may not happen for quite some time.

Now the one thing, Robert, I want everyone to keep an eye on here is real wages. Now, just the other week, Robert, we talked about how real hourly wages went negative for the first time in three years, with headline inflation now at 3.8%. And wage growth just not keeping up, the consumer squeeze is real and it's intensifying. Every month that continues, the companies that depend on that discretionary spending, your Nikes, your Lulu lemons, your, you know, the discretionary spending that people just, oh, I got some extra money. I'm going to go buy some more stuff. They get a little bit more vulnerable. So just if you have those in your portfolio, keep an eye on them. Make sure your thesis hasn't changed. If it has, maybe make a trade. Robert, let's now jump to our second story, which is Q1 GDP getting revised

down. And that's now making that stagflation math a little bit more uncomfortable. This came out earlier this week as well. Second estimate for the first quarter GDP came in at just 1.6% annualized growth. That's revised down from that initial 2.0% estimate. The revisions tell you exactly where the cracks are beginning to form. So, Robert, why don't you walk us through the revision? Yeah, consumer spending, which accounts for more than two-thirds of the entire U.S. economy, was revised down to a 1.4% growth rate from the initially reported 1.6%. Investment was also revised lower. The Bureau of Economic Analysis said the downward revision was primarily reflecting downward revisions to investment and consumer spending. Those are the two biggest

engines in the American economy and both came in weaker than we expected. Now for context, Q1 growth at 1.6% is still an acceleration from Q4 of 2025's 0.5% growth. So the economy, not falling off a cliff. We're still trending in the right direction, but it's not firing on all cylinders. It's not giving a lot of people confidence here. We're growing enough just to avoid a recession while inflation still runs hot at that 3.8%. And that's the number that should really stop you in your tracks. GDP at 1.6%. Inflation at 3.8%.

That gap, low growth plus high inflation, is the textbook set up for stagflation. The last time the U.S. was in a genuine stagflation environment was the late 1970s under Paul Volker, and we're not there yet. But we are closer to it than we've been at any point since 2022. And the trend is definitely moving in the wrong direction. So we'll be keeping an eye on that. But stock market doesn't care. Stock markets at all time highs, Dow, NASDAG, S&P record highs across the board baby.

Green, green, green, green. So that's the thing. You can get all sad or mope or all this stuff going on. The economy, the this, the that. That's why it's never more important. You look at this 3.8%. Robert, got to be invested. Because you know what's up?

multiples of that 3.8% is the S&P, 10% year to date. the NASDAQ 20% year-to-date. The only way anyone listening right now is going to outperform inflation on a consistent, consistent basis is to have their net worth, their assets invested in the markets that go up by high single digits, low double digits every single year over a long period of time when you average it out. So Robert, that's my take, but what does this mean for our listeners and their money? Yeah, it means don't try to sit on the sidelines and time the market because it never makes exact sense. We've got all these crazy things happening.

But here's the disconnect you need to understand. The stock market is at record highs while GDP growth is getting revised down and inflation is running at a two-year high. That sounds like it shouldn't work, but the reason it works right now is corporate earnings. Q1 earnings season came in ahead of expectations. Companies are cutting costs with AI,

passing through prices where they can, and keeping margins intact, despite the macro headwinds. The market isn't trading on GDP. It's trading on profits. Big, big factor here. So to wrap it up, don't fight the tape, but don't chase it either. The market is at all-time highs and the macro data is deteriorating.

That doesn't mean sell everything, earnings are strong, and momentum is real. But it does mean this isn't the time to go all in on speculative names or lever up your portfolio. Keep the quality filter high and just pay. be diversified. And if you are someone who wants to know how we diversify our own portfolios, you need to go check out Blossom. You need to also be dollar cost averaging, no matter what's going on here in the markets. We talk about how important it is to have a plan and to stick with it. And we've been dollar cost averaging into our favorite index funds, ETFs and blue chip single stocks for a while, especially whenever you look at the markets and they're going up, they're going down, they're going left, they're going right, very much like what we've seen, Robert, you're to date.

We were down 7%. Now we're up 30% from those lows, which is why it's so important to not just be dollar cost averaging, having a plan, but also staying connected with other people who are on the same boat as you. And on Blossom, you're able to see your entire portfolio, your holdings, your performance, your dividends, all of that fun stuff,

but you're also able to learn from other like-minded investors. So, Robert, tell us about those investors. Not to mention the portfolios, on Blossom are all verified. So if you're seeing someone buy or sell a name, it's because they actually did it in their own brokerage account. We're both on here. Our portfolios are on here. So if you want to join us, search Blossom Social in the app store or head over to Blossomsocial.com on your phone or desk comp. There's a link in the show notes below as well. And they also have Beavis, B-E-E-V-I-S, which is their AI investing companion. So if you want to ask their AI, what do you think

about my portfolio, help me understand my dividend growth, help me understand my international exposure, like literally ask it like you would be asking a finance professor. You can do that. You can get the insights you need over on Blossom. Again, Blossomsocial.com on your phone or desktop. Link in the show notes below. Blossom social, incredible platform. Robert, let's now jump to our third in final story of the day, which is the Pope calling for the disarming of artificial intelligence. One of those stories that honestly, I saw it and I was like, wait, that's back, what? What? That can't be real. But actually, Robert, on Monday, Pope Leo the 14th released his first encyclical,

which is a 42,000-word open letter to the world's 1.4 billion Catholics titled Magnifica Humanitus, which translates to magnificent humanity. The core message is this. Artificial intelligence needs to be disarmed before it outpaces humanity's ability to govern it. Holy smokes. Yeah, it was pretty crazy when I saw it as well, but let's be clear. The Pope is not calling for a pause on AI development. He's calling for a deliberate slowdown and how fast we deploy it and adopt it to give ethics, governance, and public oversight time to catch up. He writes that it is not permissible to entrust lethal or otherwise irreversible decisions to artificial systems and warns that AI could contribute to what he calls the normalization of war. He goes, directly at the concentration of power in big tech, writing that a more moral AI is not enough if that morality is determined by a few.

Now here's where the story goes from religion to actual business here. Anthropics co-founder Christopher Ola stood next to Pope Leo at the Vatican to help unveil the encyclical. This is the same Anthropic that's already in a public feud with the Trump administration over the Pentagon using their AI-10. technology for autonomous weapons and mass surveillance.

Now, one of the most important AI companies in the world right now, openly siding with the Vatican over the White House, is pretty eye-opening, Robert, if you ask me. Yeah, and the White House response was immediate and sharp. Trump's AI czar David Sachs posted on X. If we hand government sweeping power over AI development in the name of safety, how do we prevent it from being used to censor, surveil, and control citizens? as Orwell foretold in 1984. Interior Secretary Doug Bergam dismissed the Pope's concerns entirely.

The administration's position hasn't changed. The AI arms race with China comes first. Guard rails come later or never. Yeah, the European Commission is already citing the encyclical and policy discussions. California's governor's race is debating it. Foreign policy ran a piece titled on AI. It's Pope Leo versus Trump. So this went from a religious document now to a geopolitical flashpoint in like, you know, a couple days here this week.

It's crazy, Robert. It's absolutely crazy to see how just up in arms people can be about this technology. Definitely, Austin. So what does this mean for you and your money? So let me explain why a 42,000 word paper letter matters for your brokerage account. The entire AI trade, Nvidia, Microsoft, meta, alphabet. the hyperscalers, the supply chain, all of this has built on a very simple assumption that the United States government will let these companies build as fast as they want with virtually no regulatory

friction at all. That has been the trade. That has been the assumption. Now, that's been our reality as well since Trump repealed Biden's AI executive order in January of 2025, no speed bumps, no guardrails, maximum velocity. And it has been rocket fuel for these. companies. But what Pope Leo just did is give political cover now to every regulator in the world who's been looking for a reason to act against AI. 1.4 billion Catholics just received a moral argument for why this technology needs guardrails. The EU, which is already the most aggressive tech regulator on the planet, now has a moral framework from the most influential religious leader on Earth backing their position. Policy doesn't have to be.

happen in a vacuum. It happens when the entire public pressure is coming on and helps you justify action. Now, this doesn't change the AI thesis, Robert. Let's be clear here. The demand for the chips, the cloud compute, AI infrastructure. It's real. It's accelerating. Our portfolios are deeply in the green now because of it. Video's going to keep selling. Microsoft's going to keep building. But this does introduce a regulatory tail risk that was not priced into these stocks just a month ago. Yeah, I agree. But I also. like what the U.S. government's doing because we do have to be ahead of the rest of the world in the AI race and in the crypto and blockchain race as well. And I think that's why they're

looking at let's put the guardrails in later after we get ahead of everybody else in the adoption, in the development so we can win this arms race of sorts. So for your portfolio, here's the practical takeaway. Every mega trend eventually meets regulation. Social media did, crypto did, AI will too. It's just a question of when and how aggressively. The company's best position to navigate that are the ones that are already investing in safety and governments. Anthropics siding with the Vatican isn't just a moral stance. It's a business strategy. They're positioning themselves as the responsible AI company so that when regulation does come, they're already ahead of it. And the companies that are most exposed are the ones racing to deploy autonomous systems without guardrails,

the ones whose revenues entirely depend on government contracts where AI ethics could become a procurement requirement, very much like I think it was the Department of War when they didn't agree with Anthropics' ability to sort of throttle their autonomous war stuff, said, well, there's supply chain risk now. Anyone working with them, see you later by, right? Stuff can change the drop of a hat. And if the EU Titans AI rules, every U.S. company selling AI products international has to now comply. This week, the timeline for AI regulation moved up.

So keep that in the back of your mind. Next time someone's telling you the AI trade is just a straight up line forever. Probably still going to go up to the right. It's a, you know, I don't know how many trillions of dollars market cap we're all going to get here because of AI over the next decade. But regulation has decided to knock on the door and say, hey, it's me. The thing that tends to cause everyone a lot of headaches, I'm here to the party. Someone let me in. Yeah, they definitely want to get their pound of flesh before we get too far ahead of things here.

But Austin, support for the show comes from VCX, the public ticker for private tech. For generations, American companies have moved the world forward through their ingenuity and determination. And for generations, everyday Americans could be part of that journey through perhaps the greatest innovation of all the U.S. stock market. That's right, Robert. It did not matter whether you were a factory worker in Detroit or a farmer in Omaha. can own a piece of the great American companies. But now that has changed. Today, our most innovative companies are staying private

rather than going public on the stock market, and the result is that everyday Americans are excluded from investing and getting left further and further behind, while a select few reap all of the benefits. Until now. Introducing VCX, the public ticker for private tech. VCX by Fundrise gives everyone the opportunity to invest in the next generation of innovation,

including the companies leading the, AI revolution, space exploration, defense tech, and so much more. So visit getvcx.com for more information. That is getvcx.com. Carefully consider the investment material before investing, including objectives, risks, charges, and expenses. This and other information can be found in the fund's prospectus at getvcx.com. This is a paid sponsorship.

With that being said, Robert, I can't wait to jump to our interview with Ron Santella, CEO and portfolio manager of equitable shares. We've had him on the show twice now, and it is always a blast having Ron hanging out with us. He does a really good job of offering sort of not just his perspective, but this guy's talking with dozens, if not hundreds of fund managers every single week and month with equitable shares and the whole team that they're building over there and their great products.

So he's got the boots on the ground intel as to what everyone thinks is going on in the stock market. Yeah, 100%. I think it's one of the coolest things we get to do with in the Rich Habits podcast is have these insider guests that just really do have the boots on the ground. They are so ahead of the information before we see it in the news because they're doing it every day right there just in the trenches. And we get to have them on here to spill the beans and tell our audience what's really going on in the market. So I'm excited about this interview as well. And you guys are going to learn a ton. We're going to talk about the stock market, of course, but also the bond market, which is,

ticking higher, which normally is not a good thing. Yes, we'll talk about inflation, but we're also going to talk about the first, call it 90 to 180 days of what Kevin Warsh as the chairman of the Fed could begin to look like, and of course, how we can begin to shape our portfolios for best outcome by the end of the year. So Robert, let's jump to our interview with Ron Santella. Ron, thanks again for joining us on this episode of the Rich Habits Radar. We're seeing those March 30 lows in the stock market. We've rebounded like crazy. I want to say the NASDAQ is up some 30% from those March lows, but something else that's also increased from the March lows are the bond yields. They have climbed over the same period. Can you explain to us one, why the bond market's important

to keep an eye on? I know it's something that people speculate Trump cares more about the bond market than the stock market, as well as what are the implications of this divergence as an investor considers how to sort of position their portfolio for the rest of 2026? First of all, great to be back today and love the question. I would start by saying that I think President Trump probably values both. I think he looks at the stock market as a measure of wealth. I think the administration is recognized that the bond market and financing is ultimately the engine of the economy.

and that's why it's important. Investors have choices, Austin, and they can look at the equity markets and the bond market and they say, where's the best place for my money? There's a notion, and there's a principle called the equity risk premium,

which is essentially, is an investor getting rewarded enough to be in the stock market. And with the 10-year currently in that sort of 4.45 to 4.5% range and the forward P.E ratio at about 22 consensus earnings, there's not much for premium

to be in equities. So at some point, either earners momentum has to continue and earners need to grow or the bond market needs to pull back or a combination of both. I like how you called out the earnings momentum continuing. Maybe take a moment to, because we've talked about this a ton inside the Rich Habits Network as of late, right? We saw this kind of, I mean, it was interesting. If you look at the earnings per share, actual earnings per share here from Q1 earnings heading into the, call it April, May, you know, time frame there, it just skyrocketed. because Q1 earnings were so good. And what we had to see was the stock market sort of reconciling that,

which is why, in my opinion, we've seen such a big rally, but maybe talk a little bit more about how important it is for investors to understand earnings and the PE ratio. We just did a whole episode talking about the PE ratio, so our audience is going to know exactly what you're talking about here.

So, Ron, walk us through some of that. Yeah, I think, look, at the most basic level in equity is the net present value of his future earnings. So when investor buys the stock, they're buying earnings. Now, stocks are different. We have stocks that are stable. We have income stocks, utilities. I think in the current environment, you have to separate the market multiple, which might be 21 or 22, from different areas of growth. And I think we're seeing right now that investors are willing to pay a premium multiple for stocks that have a high growth potential. Totally agree. Over to you, Robert. Yeah, I like that. And, you know,

obviously the markets are ripping. We're at all time highs all over the place. We've got all these crazy headlines. And in addition to the rise in bond yields, where do you see challenges? Do the equity markets face any near-term challenges or over the next year or two that you see? Or do you think it's business as usual and we're going to keep seeing things go up and to the right? I wish I had a crystal ball, Robert. And you've been doing it quite a while like me. I know Austin, your student in the markets, markets have a way surprising all of us.

Yes. I would say right now that the backdrop does remain favorable. If you look at some of the sections that perform well, particularly say the semis, there are some good fundamentals supporting the ramp up in those stocks. But when I look at challenges for the market, I tend to break it down into the knowables and those things that we cannot know. And the noables are that we do have midterm elections coming up this year. That'll be a focus.

I believe sometime in midsummer, you'll see the market starting to focus on what that looks like. right now the odds are that we could see a shift in turning of the House, maybe the Senate. Inflation seems to remain persistent. And I think whether it's the Fed or investors, they keep an eye on inflation and see what that does to bond yields. For me, one of the surprises could be the SpaceX IPO. You know, I'm not predict now it's going to trade. I think it's going to attract a ton of attention. That's been well telegraphed.

For those of us have been to markets for a while, we've memories of Facebook in 2012. which at the time was for me, probably the most euphoric IPO that came to the market. In fact, I was involved there as an investor. And I think most of us probably know that stock dropped 50% from its IPO price. It took about 14 months to retrace and get back to its IPO level. Not predicting that for SpaceX, but we have three notable IPOs coming this year. We have SpaceX, OpenAI, and Anthropic. It'll be interesting to see what that means for the market.

I completely agree. and I want to linger on the SpaceX IPO for a second because it's something we're getting a lot of questions about from our community. And I want to get your perspective on this as well, Ron. You know, some of our community members and people that are listening to the show and chiming in are saying, hey, is this SpaceX IPO going to mean that people are selling their stocks to shore up cash to then go invest in SpaceX? How will that impact, you know, some of these high-flying semiconductor names, the names inside of the SOX or the S-O-X? M.H, you know, sort of these semiconductor indices that are up 200%, 300%, microns, a great example of this.

Are they going to sell index funds? So maybe talk a little bit more, especially I want to reflect upon that meta IPO, Facebook IPO. I saw a similar comparison on X as well and people talking about how, to your point, Ron, it took, you know, 14 months for it to get back to that sort of IPO price. Maybe if you want to linger on your thoughts on how retail investors might begin to look at this IPO, the SpaceX IPO, and maybe what you're seeing from your peers. Sure.

So, first of all, I think SpaceX is a good microcosm of the market in some ways. I think we're in a market environment that is rewarding potential, rewarding growth, like some of the super growth opportunities and AI semis and the rest, but it's also putting a premium on that growth. And so I look at SpaceX, and they're involved in many examples. exciting areas. Obviously, space exploration, Starlink, you know, currently it emerged, GROC. They're even selling compute. One of their biggest revenue source now is selling compute to Anthropic. So there's a lot of exciting things under the hood when we look at

SpaceX. But ultimately, valuation does matter. And when you look at a company that could be valued as high as $2 trillion at the IPO price, I believe it's baking in a lot of the future potential. And that's where an investor has to draw that balance between all. Lying into what is unbelievable potential, but what is the right value for that? The second part of your question, Austin, is, look, that will be a $75 billion and possibly more if the underwriters excised their green show. So that will direct dollars away from other investments into that and also into anthropic and open AI down the road. Completely agree. I want to jump back to what we were talking about earlier.

We talked about inflation. We're talking about specifically in this episode. GDP getting revised a little bit lower here. I want to talk about your perspective on Kevin Warsh's first, let's call it three, four, five, six months here. The Fed, and we've talked about this now in the show, I don't know how long. I'm blue in the face talking about it, but when we entered 2006, the Fed was supposed to cut interest rates by two or three times. Now, if you go to polymarket or any of these sort of prediction markets, they say zero rate cuts in 2006 because inflation has reared its ugly head back out, specifically because of this sort of energy shock, given the

geopolitical conflict here. So we're seeing the April PCE with that climbed. The super core section of it, though, when you strip out the energy and the food and the housing, that has been relatively flat, which is good. But do you have a perspective on, you know, Kevin Warsh's responsibility now as we head into the back of 2006, the Bank of America is saying maybe no rate cuts until 27. Others are saying, hey, maybe we get a rate hike. What is Ron Santella think? Well, I think we all know at the end of the day, the Fed is heavily data dependent. And so what we say today could change with a number next month or two months. But for what's on the table today, I think Kevin Warsh has a couple of things ahead of him. I think A, he wants to start off and show

that he is independent. I think he wants to preserve the integrity of the Fed. I think that's really important. I think he understands he has to build a consensus and gain credibility with the other committee members. So I think we'll navigate that well. I think the pressure is often the administration to lower rates. The market clearly is indicating there's not a very high likelihood, in fact, probably no likelihood of a rate cut any time soon. But if one just looks to his own swearing-in ceremony with President Trump recently, President Trump had no mention about rates. Scott Bessette has not mentioned it recently in terms of lowering rates. I do believe if Kevin Worses to lean one way, he will probably put off a raid hike as long as possible

to make sure the data supports that as some kind of concession to the administration. In terms of what Ron Santal thinks, I'm in the camp of the Minnesota Fed chair, who spoke last night in Japan, where he points to the fact that we're now in the fifth year of the Fed looking at inflation that's exceeded its own target. You know, they have that 2% of where we have five straight years of inflation. The labor markets are fairly healthy. So I think the Fed is going to shift more towards controlling price levels. And now it's concerned with the labor markets right now.

I appreciate you echoing the Minnesota perspective there. Because I think, what was it? Was it last symposium? So it would have been what August of last year, Jerome Powell talked about how like the risk to inflation versus the risk to higher unemployment. They cared more about the higher unemployment. But maybe that higher unemployment didn't come as fast as Jerome Powell thought it might have. To your point, it's certainly stable. Obviously, GDP was revised lower, but I mean, it's still 1.6%.

Like, we're certainly not in a recession. So I appreciate that. I appreciate the honesty, Ron. This is what it's all about. Yeah, sure. You know, these are complex, right, Austin and Robert? I mean, the Fed is looking at the consumer, and consumer got a shot in the arm with the recent tax refunds.

But that's a one-time shot. So you look at three consecutive months of real ways declining right now. You're listening to the CEO Walmart, who has his fingers on a policy economy come on maybe raising prices. I think the next six to 12 months should be on all of our radar to see how is the consumer doing. So at the end of the day, our economy is 70% consumer-based. Yeah, for sure.

And I've got a couple things. I want to click back on the Fed just for a second because right now, Polymarket has a Fed rate hike at some point in 2026 at a 32% chance. What are your thoughts on that without the crystal ball? And what do you think the effect is if we see a Fed hike even of 25 basis points? What do you think that does to all of this momentum? in the market. Robert, the 25 basis point shift in overnight rates, whether occurs or not, to me, is always secondary to what the rest of the yield curve does. I think when the Fed looks at

rates, what they don't want to do is lose control of the rate environment. So when you watch the 10-year bottom out of 394 this year, trade up over 450 recently, if that start ticking up closer to 5%, the Fed has to look at that. And I think, they look at the tools in their arsenal. So obviously they would look at the overnight rate. And I think the rate they look at the most is that two-year rate. I think the two-year rate is essentially the forward funds rate. Got it.

My last question, Ron, is for our listeners, they're from all walks of life, all different income levels and, you know, portfolio levels. How does hedge talk through hedge a little bit, but how does that fit in the everyday person's overall? portfolio allocation. Walk us through that. I know you did a good job last time, but we have a lot of new listeners. And I want to make sure they understand your background, why hedge is important and what that means for them. Great question. I appreciate you asking. So let me just start at the environment. We have seen a few stocks go parabolic. Intel, Micron. The list can go on, correct?

And I'm sure many listeners today are invested in selling these stocks and doing quite well. I just read a piece from Howard Marks, who was the founder of Oak Tree. And actually, I'm a big fan of Howard Mark. And he was talking about that one really has to hold on to those great compounders over time. But he raised the example of Amazon that declined 90% from 1999 to 2001. Actually, it was 93%. So split-adjusted Amazon trade down to 28 cents in 2001. Most of the listeners could not hold that position and take that kind of blog.

if that was their portfolio. So the reason one looks to heads is to make that a sleeve or a part of an overall portfolio allocation. We're essentially that insurance in the portfolio that will provide double-dizzar returns and up markets. So over the last three years, we've annualized it over 10%. But when the markets are volatile, when the markets go down, you'll find that this product is an anchor, its stability, it's less volatile.

In fact, our volatility has been about the same as fixed income over the last three years. So it allows one, I think, to handle the more vital parts of our portfolio and stay fully invested. And something we discussed a lot on this show is market timing is not optimal. We don't want to time the market. And I think that's where hedge plays a major role. One of my favorite callouts from our previous episode with you is, you know, hedge, HEDG is the ticker of the ETF. I own it. Robert owns it.

And what's so fun about it is you had talked about in this prior episode, you said, insurance is cheap when the markets are high and green, right? And so everyone wants insurance. Everyone's buying put option contracts when the markets are full of turmoil and red. And so people start running for the insurance. Oh, I want to have a hedge against my downside risk. But when things are great, when everybody is feeling euphoric, now is a wonderful time. Like Robert and I always say, if you're in a very speculative trade or some sort of thing goes parabolic. Nothing goes straight up in a line forever. Take your profits and reallocate it to other parts your portfolio, including HEDG, this incredible piece of insurance that will buoy up a portfolio in case we have another

Q1, right, where we had that Trump tariff tantrum in 2025 in this recent geopolitical conflict here in 2006. Love the analogy, Austin. We look at as being insurance like, I would draw one distinction. When one buys insurance, you pay for, you purchase insurance. When one buys put spreads, you're paying a premium for that. There's a reason why with heads we make quarterly distributions in the range of the two-year rate that have been very tax-efficient.

We want people to get paid why they wait for that insurance. And that's an important consideration at Equival and for HEDG, our ETF. Completely agree. Ron, thank you so much for joining us on this week's episode of the Rich Habits Radar. Your information, your perspective, your analysis is invaluable. And everybody, again, please go check out HEDG and go check out Equable Shares website. Everything's going to be linked in the show notes below. Gentlemen, great to be here.

Thanks for having me. Thanks, Ron. We always appreciate you stopping by. Another incredible conversation with Ron Centella, CEO and portfolio manager at Equable shares. Be sure to learn more about Equable Shares and his hedge ETF, HEDG, using the link in the show notes below. Robert, I always have too much fun with these episodes. We're just Friday, it's good vibes, it's headline news, it's everything we need.

I love these episodes because I feel like we're just giving it right off the dome. Markets are ripping. There's all, and it's crazy to think when you look at the, all of the different headlines, it seems like we would be in a downward trend in the market, yet everything is ripping. We're all making money. Things are great. And this is why we want active management of our money, personal finances, personal, and just keeping an eye on what's really happening in the market.

markets. And I think that's what these Friday episodes bring is an up-to-date thesis of what we think is going on. So I love these episodes. And these Friday episodes, you know, they're only about a year old or so, not even a year old. I mean, we're always trying to improve them. So please leave us a comment on Spotify. Leave us a comment on YouTube. Vote in the poll below. Subscribe to us wherever you're watching us. It would be really great. We want to get your feedback. We want to make these episodes better and better over time. You said, hey, let's get this more interview style. Let's get some really smart people in the show. So we've done that. We've reached out to a ton of smart people. We had Ron Santella this week. We had Wisdom Tree another week. I mean, we're all over the place here,

doing the best we can to connect you with our network and the people we're talking with on a weekly and monthly basis. So we get a better understanding and saying, hey, let's, let's open up this information, Robert, to our audience as well. With that being said, everyone, thanks so much for tuning into this week's episode of the Rich Habits Radar, and we'll see you on Monday.