Guy Adami, Dan Nathan and Carter Worth look at the top market headlines for Wednesday, November 30th - Mike Wilson's “wild ride” prediction for stocks in early '23 - Powell speaking at 1:30pm - $NFLX $CRWD $WDAY - Carter takes a look at Banks + Industrials MRKT Call is brought to you by our presenting sponsors CME Group, FactSet & SoFi Watch MRKT Call LIVE at 1pm M-TH on YouTube Sign up for our emails Follow us on Twitter @MRKTCall Follow Dan Nathan @RiskReversal on Twitter Follow @GuyAdami on Twitter Follow @CarterBWorth on Twitter Follow us on Instagram @RiskReversalMedia Like us on Facebook @RiskReversal Watch all of our videos on YouTube
Guy Adami, Dan Nathan and Carter Worth look at the top market headlines for Wednesday, November 30th - Mike Wilson's “wild ride” prediction for stocks in early '23 - Powell speaking at 1:30pm - $NFLX $CRWD $WDAY - Carter takes a look at Banks + Industrials MRKT Call is brought to you by our presenting sponsors CME Group, FactSet & SoFi Watch MRKT Call LIVE at 1pm M-TH on YouTube Sign up for our emails Follow us on Twitter @MRKTCall Follow Dan Nathan @RiskReversal on Twitter Follow @GuyAdami on Twitter Follow @CarterBWorth on Twitter Follow us on Instagram @RiskReversalMedia Like us on Facebook @RiskReversal Watch all of our videos on YouTube
Markets were mixed after a choppy session on Wall Street, but the Nasdaq closed down for a third straight day and fell into negative territory for November. So what should we expect as we head into the last month of the year? Morgan Stanley's Mike Wilson joins with his thoughts. Plus shares of Crowdstrike plunging after issuing disappointing earnings guidance. We dig into what's next for the stock and the sector.
Mike Wilson wasn't done being an entrepreneur when he retired after 30 years owning a retail furniture store. Now, he's doing the same thing but from his home, bringing in a revenue of $30,000-$35,000 a month selling on eBay, and he shares his tips for success in this interview. One of the great things about eBay selling as a business is its low barrier to entry. You can even get started by selling things you already have around your house, and Mike invested just $1,000 to build Golden State Picker. He'll explain how he spent that investment to grow the business and where he finds the items he sells today, along with helpful tips on how to decide how much to sell them for and how to attract customers to your online store. Just like in any business, keeping costs low can help your revenue soar as an eBay seller. Mike will share how he finds items for dirt cheap, or sometimes even free, to maximize his profits. If you've ever wondered how to start selling on eBay, you'll get a lot of your questions answered in this interview!ResourcesGolden State Picker on YouTube - More advice from Mike on how to excel as an online sellerGolden State Picker on Instagram - Connect with Mike and see pics of fun picksUpFlip listings - Find businesses for sale on the UpFlip listingsUpFlip HUB - See more advice on how to start a successful businessWorthPoint - Resource for pricing objects for saleMercari - Secondhand marketplace Whatnot - Online community marketplace for buying and selling itemsNextdoor Free Finds - Listings of free items searchable by areaeBay - Popular auction and item-selling platformFacebook - Social media platform for advertising a small businessQuickbooks - Financial management software for small business ownersAtomic Habits - Strategies to break bad habits and develop better ones
Bart & Hahn begin with the breaking news that NY Jets HC Robert Saleh announced that Mike Wilson will be starting against the Chicago Bears on Sunday & Zach Wilson will be inactive so the guys react to the news of the Jets sitting their young QB. They also take calls on the Zach Wilson benching. Braylon Edwards, Former Michigan & NFL WR joins the show to discuss the Zach Wilson benching as well as the upcoming Ohio State v Michigan rivalry game at the Horseshoe. Learn more about your ad choices. Visit megaphone.fm/adchoices
While the outlook for 2023 may seem relatively unexciting, investors will want to prepare for a volatile path to get there, and focus on some key inflection points.----- Transcript -----Welcome to Thoughts on the Market. I'm Mike Wilson, Chief Investment Officer and Chief U.S. Equity Strategist for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the latest trends in the financial marketplace. It's Monday, November 21st, at 11 a.m. in New York. So let's get after it. Last week, we published our 2023 U.S. equities outlook. In it, we detail the path to our 2023 year end S&P 500 price target of 3900. While the price may seem unexciting relative to where we're currently trading, we think the path will be quite volatile with several key inflection points investors will need to trade to make above average returns next year. The main pushback in focus from investors has centered around the first inflection - the near-term tactical upside call we made about a month ago.Let's review a few key points of the call as we discuss how the rest of the year may play out. First, the primary tactical driver to our bullish call was simply respecting the 200 week moving average. As noted when we made the call last month, the 200 week moving average does not give way for the S&P 500 until a recession is undeniable. In short, until it is clear we are going to have a full blown labor cycle where the unemployment rate rises by at least 1-1.5%, the S&P 500 will give the benefit of the doubt to the soft landing outcome. A negative payroll release also does the trick. Second, in addition to the 200 week moving averages key support, falling interest rate volatility led to higher equity valuations that are driving this rally. Much like with the 200 week moving average, though, this factor can provide support for the higher PE's achieved over the past month, but is no longer arguing for further upside. In other words, both the 200 week moving average and the interest rate volatility factors have run their course, in our view. However, a third factor market breadth has emerged as a best tactical argument for higher prices before the fundamentals take over again. Market breadth has improved materially over the past month. As noted last week, both small caps and the equal weighted S&P 500 have outperformed the market weighted index significantly during this rally. In fact, the equal weighted S&P 500 has been outperforming since last year, while the small caps have been outperforming since May. Importantly, such relative moves by the small caps and average stocks did not prevent the broader market from making a new low this fall. However, the improvement in breadth is a new development, and that indicator does argue for even higher prices in the broader market cap weighted S&P 500 before this rally is complete. Bottom line tactically bullish calls are difficult to make, especially when they go against one's fundamental view that remains decidedly bearish. When we weigh the tactical evidence, we remain positive for this rally to continue into year end even though the easy money has likely been made. From here, we expect more choppiness and misdirection with respect to what's leading. For example, from the October lows it's been a cyclical, smallcap led rally with the longer duration growth stocks lagging. If this rally is to have further legs, we think it will have to be led by the Nasdaq, which has been the laggard. In the end, investors should be prepared for volatility to remain both high intraday and day to day with swings in leadership. After all, it's still a bear market, and that means it's not going to get any easier before the fundamentals take over to complete this bear market next year. As we approach the holiday, I want to say a special thank you to our listeners. We've recently passed an exciting milestone of over 1 million downloads in a single month, and it's all made possible by you tuning in and sharing the podcast with friends and colleagues. Happy Thanksgiving to you and your families.
As we transition away from our fire and ice narrative and into the late cycle stage, investors will want to change up their strategies as we finish one cycle and begin another.----- Transcript -----Welcome to Thoughts on the Market. I'm Mike Wilson, chief investment officer and chief U.S. equity strategist for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the latest trends in the financial marketplace. It's Monday, November 14th, at 11 a.m. in New York. So let's get after it. Last year's fire and ice narrative worked so well, we decided to dust off another Robert Frost jewel to describe this year's outlook, with The Road Not Taken. As described by many literary experts, and Frost himself, the poem presents the dilemma we all face in life that different choices lead to different outcomes, and while the road taken can be a good one, these choices create doubt and even remorse about the road not taken. For the year ahead, we think investors will need to be more tactical with their views on the economy, policy, earnings and valuation. This is because we are closer to the end of the cycle at this point, and that means that trends in these key variables can zig and zag before the final path is clear. In other words, while flexibility is always important to successful investing, it's critical now. In contrast, the set-up was so poor a year ago that the trends in all of the variables mentioned above were headed lower in our view. Therefore, the right choice or strategy was about managing or profiting from the new downtrend. After all, Fire and Ice the poem is not a debate about the destination, it's about the path to that destination. In the case of our bear market call, it was a combination of both fire and ice - inflation and slowing growth, a bad combination for stocks. As it turned out, the cocktail has been just as bad for bonds, at least so far. However, as the ice overtakes the fire and inflation cools off, we're becoming more confident that bonds should beat stocks in this final verse that has yet to fully play out. That divergence can create new opportunities and confusion about the road we are on, and why we have recently pivoted to a more bullish tactical view on equities. In the near term, we maintain our tactically bullish call as we transition from fire to ice, a window of opportunity when long term interest rates typically fall prior to the magnitude of the slowdown being reflected in earnings estimates. This is the classic late cycle period between the Fed's last hike and the recession. Historically, this period is a profitable one for stocks. Three months ago, we suggested the Fed's pause would coincide with the arrival of a recession this cycle, given the extreme inflation dynamics. In short, the Fed would not be able to pause until payrolls were negative, the unequivocal indicator of a recession, but too late to kick save the cycle or the downtrend for stocks. However, the jobs market has remained stronger for longer, even in the face of weakening earnings. More importantly, this may persist into next year, leaving the window open for a period when the Fed can slow or pause rate hikes before we see an unemployment cycle emerge. That's what we think is behind the current rally, and we think it can go higher. We won't have evidence of the hard freeze for a few more months, and markets can dream of a less hawkish Fed, lower interest rates and resilient earnings in the interim. Last week's softer than expected inflation report was a critically necessary data point to fuel that dream for longer. We expect long duration growth stocks to lead the next phase of this rally as interest rates fall further. That means Nasdaq should catch up to the Dow's outsized move higher so far. Unfortunately, we have more confidence today than we did a few months ago in our well below consensus earnings forecast for next year, and that means the bear market will likely resume once this rally is finished. Bottom line, the path forward is much more uncertain than a year ago and likely to bring several twists and periods of remorse for investors wishing they had traded it differently. If one were to take our 12 month S&P 500 bear, base and bull targets of 3500, 3900, and 4200 at face value, they might say it looks like we are expecting a generally boring year. However, nothing could be further from the truth. In fact, we would argue the past 12 months have been boring because a bear market was so likely we simply set our defensive strategy and stayed with it. That strategy has worked well all year, even during this recent rally. But that kind of strategy won't work over the next 12 months, in our view. Instead, investment success will require one to turn over the portfolio more frequently as we finish one cycle and begin another. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcast app. It helps more people to find the show.
With the Fed continuing to focus on inflation and the upcoming midterm elections suggesting market volatility, investors may be wondering, is the U.S. equity market rally really over?----- Transcript -----Welcome to Thoughts on the Market. I'm Mike Wilson, Chief Investment Officer and Chief U.S. Equity Strategist for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the latest trends in the financial marketplace. It's Monday, November 7th, at 11 a.m. in New York. So let's get after it. Last week's pullback in major U.S. stock indices was not a surprise as the Fed remained committed to its mandate of getting inflation under control. However, if our tactical rally in U.S. stocks is going to have legs, 10 year U.S. Treasury yields will need to come down from current levels. Otherwise, it will be difficult to see higher prices for the S&P 500, given how sensitive this large cap growth index is to interest rates. Furthermore, we remain of the view that 2023 earnings forecasts are as much as 20% too high, so it will be difficult for stocks to move higher without valuations expanding. Does this mean the U.S. equity rally is over? We don't think so, but it's going to remain very noisy in the near term. First, we have two more important events this week to contend with: the Consumer Price Index release on Thursday and the midterm elections on Tuesday. On the former, we aren't that focused on it because it tells us little about the trajectory of inflation going forward. Nevertheless, we appreciate that the bond market remains fixated on such data points and will trade it. Therefore, it's likely to keep interest rate volatility high through Thursday. If interest rate volatility falls with the passing of these data, equity valuations can then expand further. In terms of interest rate levels, we think next week's midterms could play a bigger role. Should the polls prove correct, the Republicans are likely to win at least one chamber of Congress. This should throw a wrench into the aggressive fiscal spending plans the Democrats would still like to get done. Furthermore, Republican leadership has talked about freezing spending via the debt ceiling, much like they did with the Budget Control Act in 2011. This would be a sharp reversal from the past few years when budget deficits reached levels not seen since World War II. In our view, a clean sweep by the Republicans on Tuesday could greatly raise the odds of such an outcome. Such a decisive win should invoke the kind of rally and 10 year Treasury bonds to keep the equity market moving higher. One caveat to consider is that the election results may not be clear on Tuesday night, given the delay in counting mail in ballots. That means we can expect price volatility in equity markets will remain high and provide fodder for bears and bulls alike. Bottom line, we remain tactically bullish on U.S. equities, assuming longer term interest rate levels begin to fall. This week's midterm elections provide a potential catalyst in that regard. If the Republicans win decisive control of both the House and Senate, as some polls and betting markets are suggesting. Because this is purely a tactical trading view and not in line with our core fundamental view which remains bearish, we will remain disciplined on how much leash to give it. Last week we said that 3700 on the S&P 500 is our stop loss level for this rally, and markets traded exactly to that level after Friday's strong labor report before recovering nicely. For this week, we think that level could be challenged again given the uncertainty around election results. Anxiety around the Consumer Price Index Thursday morning is another reason to think both interest rate and equity volatility will remain high. Therefore, we are willing to give a bit more wiggle room to our stop loss level for next week, something like 3625 to 3650, assuming the 10 year Treasury yields don't make a new high. Conversely, if 10 year Treasury yields do trade about 4.35% and the S&P 500 tests 3625, we would suggest clients to exit bullish trades at that point. In short, the bear market rally is likely to hang around for longer than most expect if it can survive this week's test. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcast app. It helps more people to find the show.
Blaine and Mickey talk to Mike Wilson about Tennessee's dominant performance on Saturday, and kick off NFL trade deadline day talking about the moves the Titans will (or won't) make.See omnystudio.com/listener for privacy information.
A new trading month gets underway. Dom Chu and the Investment Committee debate if investors should keep riding the rally after October's big gains. Plus, Morgan Stanley's Mike Wilson explains why he thinks the bear market isn't over, but a tactical rally is still in the cards. Plus, Uber shares popping on its revenue beat. Josh Brown owns it and weighs in on the stock. And, the best stocks ideas for November
Despite companies beginning to report earnings misses and poor stock performance, the S&P 500 is on the rise, leading many to wonder how the Fed will react to this new data in their coming meeting.----- Transcript -----Welcome to Thoughts on the Market. I'm Mike Wilson, Chief Investment Officer and Chief U.S. Equity Strategist for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the latest trends in the financial marketplace. It's Monday, October 31st at 11 a.m. in New York. So let's get after it. Two weeks ago, we turned tactically bullish on U.S. equities. Some clients felt this call came out of left field, given our well-established bearish view on the fundamentals. To be clear, this call is based almost entirely on technicals rather than the fundamentals which remain unsupportive of most equity prices and the S&P 500. Today, we will put some meat around the fundamental drivers for why this call can work for longer than most expect. Last week was the biggest one for third quarter earnings season in terms of market cap reporting. More specifically it included all of the mega-cap tech stocks that make up much of the S&P 500. On one hand, these companies did not disappoint the fundamental bears like us who've been expecting weaker earnings to finally emerge. In fact, several of these large tech stocks reported third quarter results that were even worse than we were expecting. Furthermore, the primary driver of the downside was due to negative operating leverage, which is a core part of our thesis on earnings as described in the fire and ice narrative. However, these large earnings misses and poor stock performance did not translate into negative price performance for the S&P 500 or even the NASDAQ 100. This price action is very much in line with our tactical bullish call a few weeks ago. In addition to the supportive tactical picture we discussed in prior notes, we fully expected third quarter results to be weak. However, we also expected most companies would punt on providing any material guidance for 2023, leaving the consensus forward 12 month earnings per share estimates relatively unchanged. This is why the primary index didn't go down in our view, and actually rose 4%. The other driver for why the S&P 500 rose, in our view, is tied to the upcoming Fed meeting this week. While the Fed has hawkishly surprised most investors this year, we've now reached a point where both bond and stock markets may be pricing in too much hawkishness. First, other central banks are starting to slow their rate of tightening. Second, there are growing signs the labor market is finally at risk of a downturn as earnings disappoint and job openings continue to fall. Third, the 3 month 10 year yield curve is finally inverted, and that is one item Fed Chair Jay Powell has said he's watching closely as a sign the Fed has gone far enough. However, the best evidence the Fed has already done enough to beat inflation comes from the simple fact that money supply growth has collapsed over the past year. Money supply is now growing just 2.5% year over year. This is down from a peak of 27% year over year back in March of 2021. A monetarist which suggests inflation is likely to fall just as rapidly as it tends to lag money supply growth by 16 months. This means longer term interest rates are likely to follow, which can serve as a driver of higher valuations until the forward earnings per share estimates fall more meaningfully. What this all means for equity markets is that we have a window where stocks can rally on the expectation inflation is coming down, which allows the Fed to pause its rate hikes at some point in the near future, if not this week. Moreover, this pause must occur while earnings forecasts remain high. The bottom line is that we continue to think there's further upside toward 4000 - 4150 from the current 3900 level. However, for that to happen, longer term interest rates will need to come down, and that will likely require a less hawkish message from the Fed. That puts a lot of pressure on this week's Fed meeting for our tactical call to keep working. If the Fed comes in hawkish and squashes any hopes for a pause before it's too late, the rally could very well be over. More practically, anyone who jumped on board this tactical trade should use 3700 on the S&P 500 as a stop loss for remaining bullish. Conversely, should longer term interest rates fall after Wednesday's meeting, we would gain more confidence in our 4150 upside target for the trade and even consider further upside depending on the message from the Fed. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcast app. It helps more people to find the show.
Guy and Dan discuss Mike Wilson of Morgan Stanley seemingly turning less bearish (1:00), recap of tech earnings last week (3:30), this week's Fed Meeting, and Chinese equities (9:20). The co-hosts go “Off The Tape” with Drew Schardt, Head of Global Investment Strategy at Hamilton Lane, and talk about the credit market (14:10), who a Hamilton Lane client is (21:00), private market valuations (25:30), the retail investor (32:00), opportunities in the market (38:50), his view on the macro environment (41:00). Check out our show notes and transcript here ---- Shoot us an email at OnTheTape@riskreversal.com with any feedback, suggestions, or questions for us to answer on the pod and follow us @OnTheTapePod. We're on social: Follow Dan Nathan @RiskReversal on Twitter Follow @GuyAdami on Twitter Follow Danny Moses @DMoses34 on Twitter Follow us on Instagram @RiskReversalMedia Subscribe to our YouTube page
Welcome to the Bridge, a podcast all about resiliency and overcoming obstacles. I'm your host, Dr. Linda Fedrizzi-Williams, the president of Central Penn College. On today's podcast, we will be speaking to the Chief Experience Officer of Members First Federal Credit Union, Mike Wilson. Wilson, born in Baltimore, Maryland and attended Lewisburg High School, chose Central Penn College for higher education, receiving his bachelor's degree in Business Administration. Joining Members 1st in 2016, Wilson has moved up the ranks quickly, starting as a V-P in Relationship Management, to Chief Marketing Officer, to Chief Experience Officer. In his role, Mike provides leadership and direction for the credit union's retail, operations, and customer service areas as well as public relations, marketing, community outreach, internal and external communications, and financial literacy. Mike has strong community ties to the southcentral Pennsylvania region as a graduate of the Leadership Harrisburg, Cumberland, Lancaster, and Lebanon programs, and is a lifelong advocate of the tenets of servant leadership. With a passion for people and entrepreneurial thinking, Mike has been recognized for his professional accomplishments with numerous business awards, including Emerging Business Leader of the Year for the Harrisburg Regional Chamber. Wilson is also the President of Members 1st Charitable Foundation. After graduating from Central Penn College, and he went on to earn his MBA from Eastern University and is also a graduate of the 2019 and 2021 Credit Union Executive Society “CEO Institutes” which were held at the University of Pennsylvania's Wharton School of Business and the University of Virginia's Darden School of Business, respectively. Please join me in welcoming Mike Wilson!
As equities enjoy their best week since the summer highs in June, investors seem at the mercy of powerful market trends, so when might these trends take a turn to the downside?----- Transcript -----Welcome to Thoughts on the Market. I'm Mike Wilson, Chief Investment Officer and Chief U.S. Equity Strategist for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the latest trends in the financial marketplace. It's Monday, October 24th, at 11:30 a.m. in New York. So let's get after it. Last week, we made a tactically bullish call for U.S. equities, and stocks did not disappoint us. The S&P 500 had its best week since June 24th, which was the beginning of the big summer rally. As a reminder, this is a tactical call based almost purely on technicals rather than fundamentals, which remain unsupportive of higher equity prices over the next 3 to 6 months. Furthermore, the price action of the markets has become more technical than normal, and investors are forced to do things they don't want to, both on the upside and the downside. Witness September, which resulted in the worst month for U.S. equities since the COVID lockdowns in March of 2020. The same price action can happen now on the upside, and one needs to respect that in the near term, in our view. As noted last week, the 200 week moving average is a powerful technical support level for stocks, particularly in the absence of an outright recession, which we don't have yet. While some may argue a recession is inevitable over the next 6 to 12 months, the market will not price it, in our view, until it's definitive. The typical signal required for that can only come from the jobs market. While nonfarm payrolls is a lagging indicator that gets revised later, the equity market tends to be focused on it. More specifically, it usually takes a negative payroll reading for the market to fully price a recession. Today, that number is a positive 265,000, and it's unlikely we get a negative payroll number in the next month or two. Of course, we also appreciate the fact that if one waits for such data to arrive, the opportunity to trade it will be missed. The question is one of timing. In the absence of hard data from either companies cutting guidance significantly for 2023 or unemployment claims spiking, the door is left open for a tactical trade higher before reality sets in. Finally, as we begin the transition from fire to ice, falling inflation expectations could lead to a period of falling interest rates that may be interpreted by the equity market as bullish, until the reality of what that means for earnings is fully revealed. Given the strong technical support just below current levels, the S&P 500 can continue to rally toward 4000 or 4150 in the absence of capitulation from companies on 2023 earnings guidance. Conversely, should interest rates remain sticky at current levels, all bets are off on how far this equity rally can go beyond current prices. As a result, we stay tactically bullish as we enter the meat of what is likely to be a sloppy earnings season. We just don't have the confidence that there will be enough capitulation on 2023 earnings to take 2023 earnings per share forecasts down in the manner that it takes stocks to new lows. Instead, our base case is, that happens in either December when holiday demand fails to materialize or during fourth quarter earnings season in January and February, when companies are forced to discuss their outlooks for 2023 decisively. In the meantime, enjoy the rally. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcasts app. It helps more people to find the show.
In this episode of The Cordial Catholic, I'm joined by YouTube sensation Mike Wilson from The Popish Plot to tell the incredible story of how an encounter with a well-meaning Evangelical Christian – and his pastor – led Mike to look deeper into his own Catholic faith, to double down on the ancient creeds, and to become serious about following the practice of his Catholic faith. It's an amazing story which begins with a question about salvation and baptism but doesn't end there. You're going to love our conversation!For more from Mike you can follow him on Twitter and find The Popish Plot on podcast and on their YouTube channel which you absolutely must check out.Send your feedback to email@example.com. Sign up for our newsletter for my reflections on episodes, behind-the-scenes content, and exclusive contests.To watch this and other episodes please visit (and subscribe to!) our YouTube channel.Please consider financially supporting this show! For more information visit the Patreon page. All patrons receive access to exclusive content and if you can give $5/mo or more you'll also be entered into monthly draws for fantastic books hand-picked by me.If you'd like to give a one-time donation to The Cordial Catholic, you can visit the PayPal page.Thank you to those already supporting the show!Ashley T Lee PodcastAshley T. Lee Podcast will cover many life issues such as overcoming stress, anxiety...Listen on: Apple Podcasts SpotifyThis podcast is brought to you in a special way by our Patreon Co-Producers Gina, Eyram, Susanne, Elli and Tom, Kelvin and Susan, and Stephen.Support the showFind and follow The Cordial Catholic on social media on:Instagram: @cordialcatholicTwitter: @cordialcatholicYouTube: /thecordialcatholicFacebook: The Cordial CatholicTikTok: @cordialcatholic...
Danny is joined by his “The Big Short” colleagues Vincent Daniel and Porter Collins to discuss Mike Wilson's bullish note (3:30), earnings season kicking off (9:30), Tesla volatility (20:10), and their favorite investment ideas in the market right now (28:00). Later, Dan and Guy interview Adam Demuyakor, Founder and Managing Partner of Wilshire Lane Capital, and talk about his background on Wall Street (38:35), why he started Wilshire Lane Capital (41:10), how he looks at proptech (43:00), advice he is giving to his portfolio companies about the macro environment (52:40), and his philanthropic efforts (57:12). Check out our show notes and transcript here ---- Shoot us an email at OnTheTape@riskreversal.com with any feedback, suggestions, or questions for us to answer on the pod and follow us @OnTheTapePod. We're on social: Follow Dan Nathan @RiskReversal on Twitter Follow @GuyAdami on Twitter Follow Danny Moses @DMoses34 on Twitter Follow us on Instagram @RiskReversalMedia Subscribe to our YouTube page
Knox Brew Stories is a weekly live radio show and podcast that offers an in-depth look at the craft beer scene in Knoxville, and the latest craft beer news from around the country and all over the world.Support us on Patreon! Head to https://www.patreon.com/knoxbrewstories to check out the different ways you can show your support while receiving exclusive content, a shoutout on-air, and backstage passes to members-only events and merch!In this episode you'll find our regular weekly news about craft beer, as well as:Brew News (4:03)Live Music with LB Beistad (13:58)Interview with Mike Wilson (20:55)Live Music with LB Beistad (45:31)This Week on Tap (53:13) *Check the blog at https://www.knoxbrewstories.com/blogHost: Zack RoskopCo-Host & Producer: Candace “Ace” Preston Co-Host & Producer: Kevin SummittHead to https://www.instagram.com/lbbeistad/ & https://www.knoxnews.com/staff/2646887001/mike-wilson/ to learn more!Be sure to tune in live every Monday at 6pm EST at http://ChannelZradio.comAnd check out https://www.knoxbrewstories.com/
Last week's September inflation data brought a subsequent rally in stocks, but can this rally hold while the bond market continues to follow the Fed?----- Transcript -----Welcome to Thoughts on the Market. I'm Mike Wilson, Chief investment Officer and Chief U.S. Equity Strategist for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the latest trends in the financial marketplace. It's Monday, October 17th, at 1 p.m. in New York. So, let's get after it.No rest for the weary as days feel like weeks and weeks feel like months in terms of price action in the financial markets. While there's always a lot going on and worth analyzing, it's fair to say last week was always going to be about the September inflation data one way or another.From our vantage point, inflation has peaked. While 8% is hardly a rate the Fed can live with, the seeds have been sown for lower prices in many goods and services. Housing is at a standstill, commodity prices have fallen substantially since April, and inventory is starting to balloon at many companies at a time when demand is falling. That means discounting should be pervasive this holiday shopping season. Finally, the comparisons get much more challenging next year, which should bring the rate of change on inflation down substantially on a year-over-year basis.At the end of last year, the bond market may have looked to be the most mispriced market in the world. That underpricing of inflation and rates was a direct result of Fed guidance. Recall that last December the Fed was suggesting they would only hike 50 basis points in 2022. More surprisingly, the bond market bought it and ten-year yields closed out the year at just 1.5%. Fast forward to today and we think the bond market is likely making the same mistake but on the other side.We think inflation is peaking, as I mentioned, and we think it falls sharply next year. Shouldn't the rates market begin to ignore Fed guidance and discount that? We can't be sure, but if rates do fall under that premise, it will give legs to the rally in stocks that began last Thursday. As we have been noting in our last few podcasts, the downside destination of earnings-per-share forecasts for next year is becoming more clear, but the path remains very uncertain. More specifically, we're becoming skeptical this quarter will bring enough earnings capitulation from companies on next year's numbers for the final price lows of this bear market to happen now. Instead, we think it may be the fourth quarter reporting season that brings the formal 2023 guidance disappointment.So how far can this rally in stocks run? We think 4000 on the S&P 500 is a good guess and we would not rule out another attempt to retake the 200-day moving average, which is about 4150. While that seems like an awfully big move, it would be in line with bear market rallies this year and prior ones. The other factor we have to respect is the technicals. As noted two weeks ago, the 200-week moving average is a formidable level for the S&P 500 that's hard to take out without a fight. In fact, it usually takes a full-blown recession, which we do not yet have.Bottom line, we think a tradable bear market rally has begun last Thursday. However, we also believe the 200-week moving average will eventually give way, like it typically does when earnings forecasts fall by 20%+. The final price lows for this bear are likely to be closer to 3000-3200 when companies capitulate and guide 2023 forecasts lower during the fourth quarter earnings season that's in January and February. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcasts app. It helps more people to find the show.
The John Fredericks Radio Show - TODAY'S GUESTS: Steve Stern, Sen. Doug Mastriano, Steve Bannon, Mike Wilson + your calls at 1-888-480-JOHN (5646) and on GETTR LIVE @jfradioshow. #GodzillaOfTruth #TruckingTheTruth #OracleOfDeplorables
On this episode of MKT Call Guy Adami, Dan Nathan and Carter Worth discuss: Mike Wilson's call for a bear market rally Will the S&P 500 take out the 200-day moving average? Lori Calvasina pounding the table on small caps Big earnings this week from Netflix, Goldman Sachs, Johnson & Johnson, Schlumberger, Snap ---- Watch MKT Call at 1pm M-TH on YouTube Sign up for our emails ---- MKT Call is brought to you by our presenting sponsors FactSet and OpenExchange. ---- Follow us on Twitter @MKTCall Follow Dan Nathan @RiskReversal on Twitter Follow @GuyAdami on Twitter Follow @CarterBWorth on Twitter Follow us on Instagram @RiskReversalMedia Like us on Facebook @RiskReversal Watch all of our videos on YouTube
Last week stocks rallied quickly but dropped just as fast as markets continue to hope for a more dovish Fed, but will this 2-way risk continue as evidence for a drop in earnings continues to accumulate?----- Transcript -----Welcome to Thoughts on the Market. I'm Mike Wilson, Chief Investment Officer and Chief U.S. Equity Strategist for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the latest trends in the financial marketplace. It's Monday, October 10th, at 1:30 p.m. in New York. So let's get after it. Last week started with one of the biggest 2 day rallies in history, only to give most of it back by Friday's close. The culprit for this higher 2-way volatility is a combination of deteriorating fundamentals with oversold technicals. As noted last week, September was one of the worst months in what's been a difficult year, and the equity market was primed for a rally, especially with the S&P 500 closing right at its 200 week moving average on the prior Friday. Low quality stocks led the rally as further evidence the rebound was just bear market action rather than the beginning of a new bull. There is also still lingering hope for a Fed pivot, but the economic data that matters the most for such a pivot, jobs and inflation, continue to dash any hopes for a more dovish Fed. The sellout of momentum and retail, to some degree, does keep 2-way risk alive in the short term as it gets quiet for the next few weeks on the earnings front. Over the past month, there has been evidence that our call for lower earnings next year is coming to fruition. Large, important companies across a wide swath of industries have either reported or preannounced earnings and guided significantly lower for the fourth quarter. Some of these misses were as much as 30%, which is exactly what's needed for next year's estimates to finally take the step function lower, we think is necessary for the bear market to be over. The question is, will enough of this happen during third quarter earnings season, or will we need to wait for fourth quarter reporting in January and February when companies tend to formally guide for the next year? We think the evidence is already there and should be strong enough for this quarter for bottoms up consensus estimates have finally come down to reality, but we just don't know for sure. Therefore, over the next two weeks, stocks could continue to exhibit 2-way risk and defend that 200 week moving average at around 3600. One interesting development that supports our less optimistic view on 2023 earnings is in the dividend futures market. More specifically, we've noticed that dividend futures have traded materially lower, even as forward earnings per share forecasts have remained sticky to the upside. One reason this might be happening now is that cash flows are weakening. This is tied to the lower quality earnings per share we predicted earlier this year as companies struggled with the timing and costs versus revenues as the economy fully reopened. Things like inventory, labor costs and other latent expenses are wreaking havoc on cash flow. Accrual accounting earnings per share will likely follow 6 to 12 months later. In short, it's just another sign that our materially lower than consensus earnings per share forecasts next year are likely to be correct. If anything, we are now leaning more toward our bear case on S&P 500 earnings per share for next year, which is $190. The consensus is at $238. Bottom line, the valuation compression in equity markets this year is due to interest rates rising rather than concern about growth. This is evidenced by the very low equity risk premium, currently 260 basis points, that we still observe. The bear market will not be over until either earnings per share forecasts are more in line with our view, or the valuation better reflects the risk via the equity risk premium channel. Bear markets are about price and time, price takes your money, time takes your patience. Let the market wear everybody else out. When nobody is calling for the bottom, you will then know it's finally time to step in. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcast app. It helps more people to find the show.
Guy, Dan and Danny are joined by Mike Wilson, Chief Investment Officer and Chief US Equity Strategist for Morgan Stanley, to discuss his thought process on the market (4:43), how the S&P 500 could get to 3,000 (8:00), what's happening with central banks (14:40), bank earnings kicking off next week (23:35), and what would make Mike bullish (30:35). Later, Cannabis advocate and operator Brady Cobb drops by to breakdown President Biden pardoning thousands of people convicted of marijuana possession and ordering review of federal pot laws (36:30). Check out our show notes and transcript here ---- See what adding futures can do for you at cmegroup.com/onthetape. ---- Shoot us an email at OnTheTape@riskreversal.com with any feedback, suggestions, or questions for us to answer on the pod and follow us @OnTheTapePod. We're on social: Follow Dan Nathan @RiskReversal on Twitter Follow @GuyAdami on Twitter Follow Danny Moses @DMoses34 on Twitter Follow us on Instagram @RiskReversalMedia Subscribe to our YouTube page
As globalization slows and companies begin to nearshore their supply chains, investors may be wondering what the costs and benefits are of bringing manufacturing back home.Important note regarding economic sanctions. This research references country/ies which are generally the subject of comprehensive or selective sanctions programs administered or enforced by the U.S. Department of the Treasury's Office of Foreign Assets Control (“OFAC”), the European Union and/or by other countries and multi-national bodies. Any references in this report to entities, debt or equity instruments, projects or persons that may be covered by such sanctions are strictly informational, and should not be read as recommending or advising as to any investment activities in relation to such entities, instruments or projects. Users of this report are solely responsible for ensuring that their investment activities in relation to any sanctioned country/ies are carried out in compliance with applicable sanctions.----- Transcript -----Welcome the Thoughts on the Market. I'm Michael Zezas, Head of Global Thematic and Public Policy Research for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the intersection between U.S. public policy and financial markets. It's Wednesday, October 5th, at 10 a.m. in New York. We speak often here about the themes of slowing globalization, or slowbalization, and the shift to a multipolar world. It's important to understand these megatrends, as they will likely impact global commerce for decades to come and in many ways we cannot yet anticipate. But one impact we have anticipated is multinational companies spending money to shift their supply chains. Whereas globalization meant companies could focus on lowering their labor and transportation costs through 'just in time' logistics, 'just in case' logistics are the watchword of the multipolar world. Companies will have to invest money to nearshore or friend shore to protect their supply chains from seizing up due to geopolitical conflicts, be it war, such as Russia invading Ukraine leading to sanctions, or the proliferation of policies by Western governments, preventing companies from producing and/or sourcing sensitive technologies overseas. Now, we're increasingly seeing evidence that this dynamic is already at play. Take Apple, for example, which, according to the Wall Street Journal, recently released a supplier list showing that in September of 2021, 48 of its suppliers had manufacturing sites in the U.S., up from 25 just a year before. The article goes on to cite several semiconductor chip makers who have recently opened US based sites. One company recently agreed to invest as much as $100 billion in a semiconductor manufacturing facility in upstate New York. Another announced plans to invest $20 billion for chip factories in Ohio. So it's clear that companies are starting to respond to geopolitical incentives. The long term public policy benefits of these moves could prove to be quite sound, but in the short term they're a challenge to markets. These investments cost money and represent elevated costs relative to what these companies would have enjoyed had the geopolitical environment not become more challenging. That means investors have to price in yet another margin pressure on top of the ones our colleague Mike Wilson continues to highlight in U.S. equities, from labor costs and the fed hiking rates to engineer slower economic growth. So bottom line for investors, shifting to a new geopolitical world order may be necessary, but it will cost something along the way. And for the moment, that means extra pressure on a U.S. equity market that's already got its fair share. Thanks for listening. If you enjoy the show, please share Thoughts on the Market with a friend or colleague, or leave us a review on Apple Podcasts. It helps more people find the show.
With investors becoming pervasively bearish on stocks and bonds in the face of a worsening growth outlook, can the U.S. investment grade credit market provide shelter from the storm?----- Transcript -----Welcome to Thoughts on the Market. I am Vishy Tirupattur, Morgan Stanley's Global Director of Fixed Income Research. Along with my colleagues, bringing you a variety of perspectives, today I'll share why corporate credit markets may be a sheltering opportunity amid current turbulence. It's Tuesday, October 4th, at 11 a.m. in New York. At a September meeting, the Federal Open Market Committee delivered a third consecutive 75 basis point rate hike, just as consensus had expected. The markets took this to mean a higher peak and a longer hiking cycle, resulting in sharp spikes in bond yields and a sell off in equities. At the moment, both 2 and 10 year Treasury yields stand at decade highs, thanks to pervasively bearish sentiment among investors across both stocks and bonds. As regular listeners may have heard on this podcast, Morgan Stanley's Chief Global Economist, Seth Carpenter, has said that the worst of the global slowdown is still likely ahead. And our Chief U.S. Equity Strategist, Mike Wilson, recently revised down his earnings expectations for U.S. equities. Navigating this choppy waters is a challenge in both risk free and risky assets due to duration risk in the former, and growth or earnings risks in the latter. Against this backdrop, we think the U.S. investment grade corporate bonds, IG, particularly at the front end of the curve, which is to say 1 to 5 year segment, could provide a safer alternative with lower downside for investors looking for income, especially on the back of much higher yields. But investors may wonder, wont credit fundamentals deteriorate if economy slows, or worse, enters the recession and company earnings decline. Here is where the starting point matters. After inching higher in Q1, median investment grade leverage improved modestly in the second quarter and is well below its post-COVID peak in the second quarter of 2020. Gross leverage is roughly in line with pre-COVID levels. Notably, while median leverage is back to pre-COVID levels, the percentage of debt in the leverage tail has declined meaningfully. But if earnings were to decline, as our equity strategists expect, leverage ratios may pick back up. That said, interest coverage is the offsetting consideration. Given the amount of debt that investment grade companies have raised at very low coupons over the years, their ability to cover interest has been a bright spot for some time. Despite sharply higher rates, median interest coverage improved in the second quarter and is around the highest levels since early 1990. This modest improvement in interest coverage comes down to the fact that even though yields on new debt are higher than the average of all outstanding debt, the bonds that are maturing have relatively high coupons. Therefore, most companies have not had to refinance at substantially higher funding levels. In fact, absolute dollar level of interest expense paid out by IG companies actually declined in the quarter and is now well below the peaks of 2021. With limited near-term financing needs, higher rates are unlikely to dent these very healthy interest coverage ratios. The combination of strong in-place investment grade fundamentals, relatively low duration for the 1 to 5 year segment and yields at decade highs, suggests that this part of the credit market offers a relatively safe haven to weather the storms that are coming for the markets. History provides some validation as well. Looking back to the stagflationary periods of 1970s and 80's, while we saw multiple decisions and volatility in equity markets, IG credit was relatively stable with very modest defaults. And while history doesn't repeat, it does sometimes rhyme, so we look to the relative safety of IG credit once again in the current environment. Thanks for listening. If you enjoy the show, please leave us a review on Apple Podcasts and share Thoughts on the Market with a friend or colleague today.
With rates and currency markets experiencing increasing volatility, the state of global U.S. dollar supply has begun to force central bank moves, leaving the question of when and how the Fed may react up for debate.----- Transcript -----Welcome to Thoughts on the market. I'm Mike Wilson, Chief Investment Officer and Chief U.S. Equity Strategist for Morgan Stanley. Along with my colleagues bringing you a variety of perspectives, I'll be talking about the latest trends in the financial marketplace. It's Monday, October 3rd, at 11 a.m. in New York. So let's get after it. The month of September followed its typical seasonal pattern as the worst month of the year, and given how bad this year has been, I don't say that lightly. But as bad as stocks have been, rates and currency markets have been even more volatile. With volatility this severe, some of the cavalry has been called in. The Bank of England's surprise move last week was arguably necessary to protect against a sharp fall in U.K. bonds. Some may argue the U.K. is in a unique situation, and so this doesn't portend other central banks doing the same thing. However, this is how it starts. In other words, investors can't be as adamant the Fed will choose or be able to follow through on its tough talk. Like it or not, the world is still dependent on U.S. dollars, which provide the oxygen for global economies and markets. Former U.S. Treasury Secretary John Connolly's famous quote that "the dollar is our currency, but it's your problem" continues to ring true. It's also one of the primary reasons why several countries have been working so hard to de-dollarise over the past decade. The U.S. dollar is very important for the direction of global financial markets, and this is why we track the growth of global dollar supply so closely. In fact, the primary reason for our mid-cycle transition call in March of 2021 was our observation that U.S. dollar money supply growth had peaked. Indeed, this is exactly when the most speculative assets in the marketplace peaked and began to suffer. Things like cryptocurrencies, SPACs, recent IPOs and profitless growth stocks trading at excessive valuations. Now we find global U.S. dollar money supply growth negative on a year over year basis, a level where financial and economic accidents have occurred historically. In many ways, that's exactly what happened in the U.K. bond market last week, forcing the Bank of England's hand. There are many reasons why a U.S. dollar liquidity is so tight; central banks raising rates and shrinking balance sheets, higher oil prices and inflation in many goods bought and sold in dollars, incremental regulatory tightening and lower velocity of money in the real economy as activity dries up in critical areas like housing. In short, U.S. dollar supply is tight for many reasons beyond Fed policy, but only the Fed can print the dollars necessary to fix the problem quickly. We looked at the four largest economies in the world, the U.S., China, the Eurozone and Japan, to gauge how much U.S. dollar liquidity is tightening. More specifically, money supply in U.S. dollars for the Big Four is down approximately $4 trillion from the peak in March. As already mentioned, the year over year growth rate is now in negative territory for the first time since March of 2015, a period that immediately preceded a global manufacturing recession. In our view, such tightness is unsustainable because it will lead to intolerable economic and financial stress, and the problem can be fixed very easily by the Fed if it so chooses. The first question to ask is, when does the U.S. dollar become a U.S. problem? Nobody knows, but more price action of the kind we've been experiencing should eventually get the Fed to back off. The second question to ask is, will slowing or ending quantitative tightening be enough? Or will the Fed need to restart quantitative easing? In our opinion, the answer may be the latter if one is looking for stocks to rebound sustainably. Which leads us to the final point of this podcast - a Fed pivot is likely at some point given the trajectory of global U.S. dollar money supply. However, the timing is uncertain and won't change the downward trajectory of earnings, our primary concern for stocks at this point. Bottom line, in the absence of a Fed pivot, risk assets are likely headed lower. Conversely, a Fed pivot, or the anticipation of one, can still lead to sharp rallies like we are experiencing this morning. Just keep in mind that the light at the end of the tunnel you might see if that happens, is actually the train of the oncoming earnings recession that even the Fed can't stop. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcast app. It helps more people to find the show.
Join us for one of our online services, and check out our website to find a bit more information about us. We would love to have you join us at https://lifepoint.online.church Find locations, our beliefs, and more info about us at https://www.lpchurch.com/about. CONNECT WITH LIFEPOINT Hub: www.lpchurch.com/hub YouTube: www.youtube.com/c/LifePointChurchNW Facebook: www.facebook.com/LifePointNW/ Instagram: www.instagram.com/lifepointnw
Welcome to the Fraser Valley Lifestyle Podcast. Our guest today is Mike Wilson. Mike's actually the publisher of Fraser Valley Lifestyle. It's one of the services that he offers to his clients. Today we'll be chatting about the state of the real estate market. Mike has been licensed as a real estate professional in the Fraser Valley, since 1987. For 21 years he was a local Re/max associate and in May 2021 he moved to Royal LePage Northstar Realty to be a little closer to home. Fraser Valley Lifestyle Magazine is a passion project for him. It's a way to give back to the community that has served my family and me for so many years and to support local businesses by sharing their events and providing some brand awareness.
After last week's Fed meeting and another rate hike, both stocks and bonds dropped back to June lows. The question is, will this turn to the downside continue to accelerate?----- Transcript -----Welcome to Thoughts on the Market. I'm Mike Wilson, Chief Investment Officer and Chief U.S. Equity Strategist for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the latest trends in the financial marketplace. It's Monday, September 26, at 11 a.m. in New York. So let's get after it. Last week's Fed meeting gave us the 75 basis point hike most investors were expecting, and similar messaging to what we heard at Jackson Hole a month ago. In short, the Fed means business with inflation and is willing to do whatever it takes to combat it. So why was there such a dramatic reaction in the bond and stock markets? Were investors still hoping the Fed would make a dovish pivot? Whatever the reason, both stocks and bonds are right back to their June lows, with many bellwether stocks and treasuries even lower. As we wrote a few weeks ago, we think investor hopes for a Fed pivot were misplaced, and Chair Powell has now made that crystal clear. Secondly, we noted last week that the only remaining hope for stocks would be if the bond market rallied at the back end on the view that the Fed was finally ahead of the curve and would win its fight against inflation, while slowing the economy materially. Instead, interest rates spiked higher, squelching any hopes for stocks. While 15.6x price earnings ratio is back to the June lows, that P/E still embeds what we think is a mispriced equity risk premium given the risk to earnings. Said another way, with a Fed pivot now off the table, the path on bond and equity prices will come down to growth - economic growth for bonds and earnings growth for stocks. On both counts we are pessimistic, particularly on the latter as supported by our recent cuts to earnings forecasts. We have been discussing these forecasts with clients for the past several weeks and while most are in agreement that consensus 2023 earnings estimates are too high, there is still a debate on how much. Suffice it to say, we are at the low end of client expectations. Interestingly, recent economic data have kept the economic soft landing view alive, and interest rates have moved above our rates team's year end forecast. From an equity market standpoint, that means no relief for valuations as earnings come down. This is a major reason why stocks sank to their June lows on Friday. Ultimately, we do think economic surprise data will likely disappoint again, but until it does there is no end in sight for the rise in 10 year yields, especially with the run off of the Fed's balance sheet increasing. As such, our rates team has raised its year end target for 10 year Treasury yields to 4% from 3.5%. This is a very tough backdrop for stocks and epitomizes our fire and ice thesis to a T. In other words, rising cost of capital and lower liquidity in the face of slower earnings growth or even outright declines. Finally, the Fed's historically hawkish action has led to record strength in the U.S. dollar. On a year over year basis the dollar is now up 21% and still rising. Based on our analysis that every 1% change in the dollar has a .5% impact on S&P 500 earnings growth, fourth quarter S&P 500 earnings will face an approximate 10% headwind to growth all else equal. This is in addition to the other challenges we've been discussing for months, like the pay back in demand and higher cost from inflation to name a few. Bottom line Part 2 of our Fire and ice thesis is now on full display, with rates and the U.S. dollar ratcheting higher, just as the negative revisions for earnings appear set to accelerate to the downside. In our view, the bear market in stocks will not be over until the S&P 500 reaches the range of our base and bear targets, i.e. 3000 to 3400 later this fall. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcast app. It helps more people to find the show.
Brad Edwards is joined by Mike Wilson of the Knoxville News Sentinel to look ahead to the Florida/Tennessee game To learn more about listener data and our privacy practices visit: https://www.audacyinc.com/privacy-policy Learn more about your ad choices. Visit https://podcastchoices.com/adchoices
Brad Edwards and Ashly Holder look at the UF/Tennessee game, which SEC team is the most overrated, Mike Wilson of the Knoxville News Sentinel joins the show and they close out the show with listener questions, To learn more about listener data and our privacy practices visit: https://www.audacyinc.com/privacy-policy Learn more about your ad choices. Visit https://podcastchoices.com/adchoices
Mike Wilson, Morgan Stanley Chief US Equity Strategist, says he is much more focused more on the earnings story than the Fed. Michael Pond, Barclays Head of Global Inflation Market Strategy, says to prepare for a hawkish Fed. Michael Collins, PGIM Fixed Income Senior Portfolio Manager, still expects a little bit more downside in credit. Kona Haque, ED&F Man Head of Research, says we currently have an energy supply and demand mismatch.See omnystudio.com/listener for privacy information.
Stocks clawed back from early losses and finished the day with modest gains, as Wall Street awaits this week's key Fed decision. Morgan Stanley's Mike Wilson joins with a warning about earnings season, and breaks down the defensive areas he's recommending now. Meantime Moderna pulled back sharply along with other vaccine names. Jefferies analyst Michael Yee discusses the move and if he'd recommend buying the dip. And the CEO of Ralph Lauren joins in a rare interview to break down the company's long-term strategy and how he views the consumer in America and abroad.
Tennessee Vols head football coach Josh Heupel and his quad take part in their final dress rehearsal prior to the start f SEC play with the Florida gators. What do you need to see? Eric Cain lists five veterans and five freshmen who need to ball out. Mike Wilson of Knox News stops by the show. Locked on Vols is your go-to Tennessee Volunteers podcast, available on YouTube and wherever you find your podcasts. The Locked On Vols podcast is your daily show covering Tennessee Volunteers football and basketball with Eric Cain. SUBSCRIBE to the show and catch it on every platform, completely free, right HERE. LinkedIn LinkedIn jobs helps you find the candidates you want to talk to, faster. Post your job for free at Linkedin.com/lockedoncollege Terms and conditions apply. Built Bar Built Bar is a protein bar that tastes like a candy bar. Go to builtbar.com and use promo code “LOCKED15,” and you'll get 15% off your next order. BetOnline BetOnline.net has you covered this season with more props, odds and lines than ever before. BetOnline – Where The Game Starts! Rock Auto Amazing selection. Reliably low prices. All the parts your car will ever need. Visit RockAuto.com and tell them Locked On sent you. Learn more about your ad choices. Visit podcastchoices.com/adchoices
Mike Wilson is a husband, biological and adoptive father, and the Co-Founder of myLIFEspeaks - a non-profit organization whose vision is for every Haitian child to experience family. Mike and his wife, Missy, have never wanted to come in and “Americanize” the culture of Haiti. Rather, they celebrate the Haitian culture while investing in locals to lead others and together elevate the future of Haiti. They know true sustainability and change comes from within. In this episode, Mike shares about where he was on January 12th, 2010 and how it was a moment he will never forget. Hear how God continually reminds him, “I'm still here,” about what keeps him up at night, and why he will always tell people not to give up on Haiti. Links to learn more: Learn more about myLIFEspeaks Follow myLIFEspeaks on Social Media: Instagram | Facebook — Learn more about Back2Back Ministries Follow Back2Back Ministries on Social Media: Instagram | Facebook --- Send in a voice message: https://anchor.fm/bethedifference/message
While interest rates have already weighed on asset markets this year and growth continues to slow, the Fed seems poised to continue on its tightening path, meaning investors may need to prepare for part two of our Fire and Ice narrative.-----Transcript-----Welcome to Thoughts on the Market. I'm Mike Wilson, Chief Investment Officer and Chief U.S. Equity Strategist for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the latest trends in the financial marketplace. It's Tuesday, September 6th, at 9 a.m. in New York. So let's get after it. At the risk of stating the obvious, 2022 has been a challenging year for stock investors of all stripes. The Russell 3000 is down approximately 18% year to date, and while growth stocks have underperformed significantly it's been no picnic for value investors either. As far as sectors only energy and utilities are up this year, and just 24% of all stocks in the Russell 3000 are in positive territory. To put that into context, in 2008, 48% of the Russell 3000 stocks were up on the year as we entered the month of September and then the bottom dropped out. Suffice it to say, this year has been historically bad for stocks. However, that is not a sufficient reason to be bullish in our view. As bad as has been for stocks, it's been even worse for bonds on a risk adjusted basis. More specifically, 20 year Treasury bonds are now down 24% year to date, and the Barclays AG Index is off by 11%. Finally, commodities have been a mixed bag too, with most commodities down on the year, despite heightened concerns about inflation. For example, the CRB RIND Index, which measures the spot prices of a wide range of commodities, is down 7% year to date. Cash, on the other hand, is no longer trash, especially if one has been able to take advantage of higher front end rates. So what's going on? In our view, asset markets are behaving right in line with the fire and ice narrative we laid out a year ago. In short, after ignoring the warning signs from inflation last year and thinking the Fed would ignore them too, asset markets quickly woke up and discounted the Fed's late but historically hawkish pivot to address the sharp rise in prices. Indeed, very rarely has the Fed tightened policy so quickly. Truth be told, as one of the more hawkish strategists on the street last December, I never would have bet the Fed would be doing multiple 75 basis point hikes this year, but here we are. And remember, don't fight the Fed. While the June low for stocks and bonds was an important one, we've consistently been in the camp that it wasn't the low for the S&P 500 in this bear market. Having said that, we are more confident it was the low for long term treasuries in view of the Fed's aggressive action that has yet to fully play out in the real economy. It may have also been the low for the average stock, given how bad the breadth was at that time and the magnitude of the decline in certain stocks. Our more pessimistic view on the major index is based on analysis that indicates all the 31% de-rating in the forward S&P 500 P/E that occurred from December was due to higher interest rates. We know this because the equity risk premium was flat during this period. Meanwhile, forward earnings estimates for the S&P 500 have come down by only 1.5%, and price earnings ratio's back up 9% from where it was. With interest rates about 25 basis points below the June highs, the equity risk premium has fallen once again to just 280 basis points. This makes little sense in a normal environment, but especially given these significant earnings cuts we think are still to come. With the Fed dashing hopes for a dovish pivot on this policy a few weeks ago, we think asset markets may be entering fire and ice part two. In contrast with part one, this time the decline in stocks will come mostly through a higher equity risk premium and lower earnings rather than higher interest rates. In fact, our earnings models are all flashing red for the S&P 500, and we have high confidence that the decline in forward S&P 500 earnings forecasts is far from over. In short, part two will be more icy than fiery, the opposite of the first half of the year. That's not to say interest rates don't matter, they do and we expect bonds to perform better than stocks in this icier scenario. Importantly, if last Thursday marked a short term low for long duration bonds, i.e. a high in yields, the S&P 500 and many stocks could get some relief again as rates come down prior to the next rounds of earnings cuts that won't begin until later this month. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcast app. It helps more people to find the show.
With Fed messaging making it clear they're not yet done fighting inflation, the market is left to contend with the recent rally and prepare to adjust growth expectations.-----Transcript-----Welcome to Thoughts on the Market. I'm Mike Wilson, Chief Investment Officer and Chief U.S. Equity Strategist for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the latest trends in the financial marketplace. It's Monday, August 29th, at 11 a.m. in New York. So let's get after it. After the Fed's highly anticipated annual meeting in Jackson Hole has come and gone with a very clear message - the fight against inflation is far from over, and the equity markets did not take it very well. As we discussed in this podcast two weeks ago, the equity markets may have gotten too excited and even pre traded a Fed pivot that isn't coming. For stocks, that means the bear market rally is likely over. Technically speaking, the rally looks rather textbook. In June, we reached oversold conditions with breadth falling to some of the lowest readings on record. However, the rally stalled out exactly at the 200-day moving average for the S&P 500 and many key stocks. On that basis alone, the sharp reversal looks quite ominous to even the most basic tactical analysts. From a fundamental standpoint, having a bullish view on U.S. stocks today is also challenging. First, there is valuation. As we have discussed many times in our research, the Price/Earnings ratio is a function of two inputs; 10 year U.S. Treasury yields and the Equity Risk Premium. Simplistically, the U.S. Treasury yield is a cost of capital component, while the Equity Risk Premium is primarily a function of growth expectations. Typically, the Equity Risk Premium is negatively correlated to growth. In other words, when growth is accelerating, or expected to accelerate, the Equity Risk Premium tends to be lower than normal and vice versa. Our problem with the view that June was the low for the index in this bear market is that the Equity Risk Premium never went above average. Instead, the fall in the Price/Earnings ratio from December to June was entirely a function of the Fed's tightening of financial conditions, and the higher cost of capital. Compounding this challenge, the Equity Risk Premium fell sharply over the past few months and reached near record lows in the post financial crisis period. In fact, the only time the Equity Risk Premium has been lower in the past 14 years was at the end of the bear market rally in March earlier this year, and we know how that ended. Even after Friday's sharp decline in stocks, the S&P 500 Equity Risk Premium remains more than 100 basis points lower than what our model suggests. In short, the S&P 500 price earnings ratio is 17.1x, it's 15% too high in our view. Second, while most investors remain preoccupied with the Fed, we have been more focused on earnings and the risk to forward estimates. In June, many investors began to share our concern, which is why stocks sold off so sharply in our view. Companies began managing the quarter lower, and by the time second quarter earnings season rolled around positioning was quite bearish and valuations were more reasonable at 15.4x. This led to the "bad news is good news" rally or, as many people claim, "better than feared" results. Call us old school, but better than feared is not a good reason to invest in something if the price is high and the earnings are weak. In other words, it's a fine reason for stocks to see some relief from an oversold condition, but we wouldn't commit any real capital to such a strategy. Our analysis of second quarter earnings showed clear deterioration in profitability, a trend we believe is just starting. In short, we believe earnings forecast for next year remains significantly too high. Finally, last week's highly anticipated Fed meeting turned out to be a nonevent for bonds, while it appeared to be a shock for stock investors. Ironically, given the lack of any material move in yields, all of the decline in the Price/Earnings ratio was due to a rising Equity Risk Premium that still remains well below fair market levels. The bottom line, we do think Friday's action could be the beginning of an adjustment period to growth expectations. That's good. In our experience, such adjustments to earnings always take longer than they should. Throw on top of that, the fact that operating leverage is now more extreme than it was prior to COVID, and the negative revision cycle could turn out to be worse than usual. Next week, we will attempt to quantify more specifically how challenging the earnings outcome might be based on an already reported macro data. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcast app. It helps more people to find the show.
While stocks and bonds have rallied since June, investors should be asking if this bear market rebound is a sign that economic growth is on its way up, or if there are negative earning revisions yet to come.-----Transcript-----Welcome to Thoughts on the Market. I'm Mike Wilson, Chief Investment Officer and Chief U.S. Equity Strategist for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the latest trends in the financial marketplace. It's Monday, August 22nd at 11 a.m. in New York. So let's get after it. Taking a few weeks off can sometimes provide a fresh perspective on markets needed at times like today. The fact that it happens to be August, the most popular time for vacations of the year, can also play into that perspective. Over the past 6 weeks many financial markets have had a strong rebound. As an example, both stocks and bonds have rallied sharply from their June lows. The question that equity investors must ask themselves is how much of the rally in stocks is due to the fall in interest rates versus a real improvement in the prospects of a soft landing in the economy? For better or worse our view has remained consistent since April that the primary concern for stocks was no longer inflation, or the Fed's reaction to deal with it, but rather the outlook for growth. In May, the consensus moved strongly into our camp, with the cries for a recession reaching a fever pitch in June. Equity markets became very oversold and the stage was set for a powerful rally. Truth be told, this rally exceeded our expectations for a normal counter trend bear market rally. However, in order to set the stage for the next leg lower, the rally needed to be convincing enough to change the very bearish sentiment to outright bullish. Based on what I have seen in the press and from our peers around the street, that sentiment has flipped with many declaring the end of the bear market and the increasing likelihood of new all time highs as soon as later this year. While there are some strong indications that inflation has peaked from a rate of change standpoint, it's too soon for the Fed to declare victory in our view. In other words, the rising hope for the Fed to pivot away from rising rates or curtailing its balance sheet reduction remains optimistic. Nevertheless, this is the primary justification for why equity markets have rallied and why it can continue. However, even if that were true, there are very few data points suggesting we have reached a trough in growth, either economically or from an earnings growth standpoint. In fact, our growth is suggesting the opposite, with earnings revision breadth accelerating to the downside, along with our other leading indicators. To put it more bluntly, rarely have we been more confident that consensus growth expectations for earnings over the next 12 months are too high. More importantly, the equity market almost never rallies if forward earnings estimates are falling, unless the valuation is completely washed out. In June, one could have credibly argued valuations were discounting a sharp decline in growth and the risk of a recession. At the lows the forward price earnings ratio reached 15.4x and was down almost 30% from the end of last year. At 15.4x is almost exactly our year end target price earnings multiple at the beginning of this year based on our view that the Fed would have to tighten aggressively to combat inflation. The problem with assuming 15.4x was a washed out level for valuations is that all of the degradation was a result of higher interest rates, while the equity risk premium remained flat to down over that time frame. In other words, at no time did the price earnings multiple discount a material slowdown in growth. Now, with the price earnings multiple exceeding 18x last week, valuations are inappropriate if one agrees with our view that earnings estimates are too high. On Friday, stocks reversed lower and that seems to be carrying into this week. Many are once again blaming the Fed and perhaps acknowledging its work in fighting inflation remains unfinished. We agree. However, with price earnings multiples still 17.4x as I record this podcast, valuations are not discounting that resolve, nor is it discounting the negative earnings revisions still to come. The bottom line stocks have experienced a classic bear market rebound after having reached a near record oversold condition on many metrics. With the Fed still very much in the picture and earnings estimates likely to fall further, equity markets are almost as unattractive as they were at the beginning of the year. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcast app. It helps more people to find the show.
As the Fed continues to surprise with large and fast interest rate increases, the market must decide, has the Fed done enough? Or is the recession already here?-----Transcript-----Welcome to Thoughts on the Market. I'm Mike Wilson, Chief Investment Officer and Chief U.S. Equity Strategist for Morgan Stanley. Along with my colleagues bringing you a variety of perspectives, I'll be talking about the latest trends in the financial marketplace. It's Monday, August 1st at 11 a.m. in New York. So let's get after it. Over the past year, the Fed has come under scrutiny for their outlook on inflation, and they've even admitted themselves that they misjudged the call when they claimed inflation would be transient. In an effort to regain its credibility, the Fed has swiftly pivoted to its most hawkish policy action since the 1980s. In fact, while we may have been the most hawkish equity strategists on the street at the beginning of the year, we never expected to see this many rate hikes in 2022. Suffice it to say, it hasn't gone unnoticed by markets with both stocks and bonds off to their worst start in many decades. However, since peaking in June, 10 year Treasuries have had one of their largest rallies in history, with the yield curve inverting by as much as 33 basis points. Perhaps more importantly, market based five year inflation expectations have plunged and now sit very close to the Fed's long term target of 2%. Objectively speaking, it appears as though the bond market has quickly turned into a believer that the Fed will get inflation under control. This kind of action from the Fed is bullish for bonds, and one of the main reasons we turned bullish on bonds relative to stocks back in April. Since then, bonds have done better than stocks, even though it's been a flat ride in absolute terms. It also explains why defensively oriented stocks have dominated the leadership board and why we are sticking with it. Meanwhile, stocks have rallied with bonds and are up almost 14% from the June lows. The interpretation here is that the Fed has inflation tamed, and could soon pause its rate hikes, which is usually a good sign for stocks. However, in this particular cycle, we think the time between the last rate hike and the recession will be shorter, and perhaps after the recession starts. In technical terms, a recession has already begun with last week's second quarter GDP release. However, we don't think a true recession can be declared unless the unemployment rate rises by at least a few percentage points. Given the deterioration in profit margins and forward earnings estimates, we think that risk has risen considerably as we are seeing many hiring freezes and even layoffs in certain parts of the economy. This has been most acute in industries affected by higher costs and interest rates and where there's payback in demand from the binge in consumption during the lockdowns. In our conversations with clients over the past few weeks, we've been surprised at how many think a recession was fully priced in June. While talk of recession was rampant during that sell off, and valuations reached our target price earnings ratio of 15.4x, we do not think it properly discounted the earnings damage that will entail if we are actually in a recession right now. As we have noted in that outcome, the earnings revisions which have begun this quarter are likely far from finished in both time or level. Our estimate for S&P 500 earnings going forward in a recession scenario is $195, which is likely to be reached by the first quarter of 2023. Of course, we could still avoid a recession defined as a negative labor cycle, or it might come later next year, which means the Fed pause can happen prior to the arrival of a recession allowing for that bullish window to expand. We remain open minded to any outcome, but our analysis suggests betting on the latter two outcomes is a risky one, especially after the recent rally. The bottom line, last month's rally in stocks was powerful and has investors excited that the bear market is over and looking forward to better times. However, we think it's premature to sound the all-clear with recession and therefore earnings risk is still elevated. For these reasons, we stayed defensively oriented in our equity positioning for now and remain patient with any incremental allocations to stocks. Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcasts app. It helps more people to find the show.