The Dividend Cafe - Tuesday - January 6, 2026

Episode Date: January 6, 2026

In this episode of Dividend Cafe, Brian Szytel provides a brief market update for January 6th, discussing recent market gains driven by anticipated tax cuts and not political events like the situation in Venezuela. He talks about Venezuela's reduced oil production and its impact on energy markets, as well as stock rotations from growth to value sectors. The economic update includes the S&P services PMI, which remains in expansionary territory. He also addresses a viewer question about gold's performance and future outlook, highlighting the complexities and factors influencing gold prices, with a specific focus on The Bahnsen Group's investment approach. 00:00 Welcome to Dividend Cafe 00:28 Market Update and Tax Cuts 01:09 Impact of Venezuela on Energy Markets 02:15 Stock Market Movements and Economic Indicators 03:05 Market Predictions and Earnings 04:18 Gold Market Analysis 05:58 Conclusion and Viewer Questions Links mentioned in this episode: DividendCafe.com TheBahnsenGroup.com

Welcome to the Dividing Cafe weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life. Good evening and welcome back in to Dividend Cafe. This is Tuesday, January the 6th. And it's Brian Saitel with you here from our West Palm Beach, Florida office in the brand new year on a nice sunny day and actually a second update in markets overall. and I wish I could tell you that it had anything to do with Venezuela or some sort of political optimism over that area of the world, but frankly, it really hasn't. Okay, so the market has been up a couple days in a row. Part of the real reason of that has been more to do with what potential tax cuts are going to come down the pike in the first quarter. Remember, a lot of that OBBB that came out was about expensing and different items that were a benefit as you file your return. versus an immediate benefit on that bill was passed as far as tax rates and some of the

things that were inside of that bill. So you'll start to see some of that. We've calculated it's somewhere near $150 billion, so it's a lot of money that should come into the economy. And I believe that that is what's more behind a positive market here. But two days in a row really doesn't make much of a year or anything to get too concerned about one way or the other. The Venezuela ordeal has certainly affected energy markets. And to put that in perspective, when you look at what Venezuela used to produce, it was about three and a half million barrels a day back in the mid-90s of oil. And over time, it has consistently gotten worse. There's a lot of reasons for that. There was sanctions. There was also mismanagement in just a poor political environment for

25, 30 years there as well. And so the infrastructure that was originally there was degraded and didn't perform as well. They're only at about a million barrels a day right now. And so if you think about that going higher, yes, it does matter. In the global scheme of things, it's probably less than people realize. And then as far as which companies themselves will benefit, some have more exposure, particularly one in the U.S. There's several of them that actually are owed money from expropriation and may end up seeing some of that money return if the political environment gets better. So there's some things on the margin that are moving some of the stocks. And there's some things on the margin that are moving some of the energy sector. If supply

comes back, those things are true. But that's not necessarily what's driving the overall stock market at this point. You have seen more of a rotation to and from from some of the growth areas into more some of the value areas, particularly more yesterday into some of the cyclical names. But that's basically what's going on. On today's move, you actually had the Dow up 484 points and you had the S&P 500, two-thirds of a percent, as was the NASDAQ. That was a fairly consistent across the board gain overall in stocks. And on the economic side today, there wasn't a a lot of news out. There was a final read on the S&P services PMI for December, which was largely in line with consensus. It was slightly lower, but it's still in expansionary territory. We got a 52.5. And remember

anything over 50 is expansionary. So there you have it on a market recap here. Yeah, it's the new year and we're starting off on the right foot. Does that mean that historically markets will absolutely be positive this year? No, it doesn't. The one thing I'd say about that is three years in a row a greater than 15% move in stocks has only happened about four times. Technically, of those times, three out of four, we were positive on the fourth year as well. But since the last time that that happened was only just way back to 2019, 20, and 21, which is just a couple years ago. And you had a pretty horrific 2022. I would just keep that in mind. The return on markets likely won't come from just magical market expansion and valuation expansion that we've seen. I think it will take

a little bit more, and I would expect some of the expansion and the broadening of some of these different sectors to start to participate a little bit. So all that said, on the year, you've got earnings per share slated to be about $306 on S&P. If you divided that by the closing price of about 6944, today that puts you at about 22.7 times earnings. And that's forward. okay so markets are pretty pretty priced in at this point we've been talking about that now for over a year but still the same story there there was a common question in the ask tbg section today about gold and what our thoughts are for 2026 it's obviously had a heck of a run when i say heck of a i'm talking about it's doubled over the last couple of years so that's a good run what i would

say is this you can't have it both ways if the thesis is i own gold because the dollar's going to continue to get weaker because we're printing money. Well, guess what? We have been doing that less the last couple of years in this big rally, right? Because the Fed balance sheet has come down by two trillion dollars, two and a half trillion over the last couple of years. And that was during the big gold rally. And if you bought gold because you thought inflation was going to be runaway, just keep in mind, inflation peaked and then has come down from 9% to now 2.7. So those things actually went counter to what their thesis would have been to own gold during this big rally. And what I would say is both of those things are changing going forward.

Inflation isn't going from nine back to 2.7. It's already at 2.7. And maybe it goes a little lower, but I would suggest that it would be something similar to where it is now. So that part is going to be different. And then the Fed balance sheet is no longer shrinking. Okay, so it's going to be right now they're reinvesting maturities and interest back into more treasuries.

And so the balance sheet's going to stay static. And then also you have a declining monetary policy. So as far as gold goes, I don't have a big opinion on it because it isn't something that has an internal rate of return that is calculable. It is something that goes up and down with these different factors. Sometimes it's correlated to some of those things and sometimes it's not. If that's a real strong thesis to own it for you, then so be it. It certainly isn't at the Bonson Group.

So that's what I have for you on the markets and on a question that came in, that was a good one for today. and I appreciate your listening, and please do reach out with continued questions, as always. I'll be back with you tomorrow on Dividend Cafe. Thank you again. The Bonson Group is a group of investment professionals registered with Hightower Securities LLC, member FINRA and SIPC, and with Hightower Advisors, LLC, a registered investment advisor with the SEC. Securities are offered through Hightower Securities LLC. Advisory services are offered through Hightower Advisors LLC.

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