Current "Massive Deviation" Suggest Stocks Will Pullback By Up To 15% Soon | Lance Roberts

Summary

• Market Outlook: The rally is extremely narrow and overextended, with breadth deteriorating and sentiment frothy, setting up for a likely 7–15% summer correction and an RSP vs. SPY reversion.
• AI/Data Centers: A massive hyperscaler capex tsunami into data centers should power GDP and earnings into 2026–2028, reducing near-term recession odds but creating downside risk if spending underdelivers.
• Semiconductors: Semis are parabolic and pricing in 2028 earnings; expect a sharp mean-reversion (potential 20–40% pullbacks), yet the longer-term AI story remains intact with buy-the-dip opportunities.
• Defensive Rotation: Positioning is shifting from high beta/momentum toward low-vol/dividend sectors; the guest trimmed mega-cap tech and added defensives (e.g., RTX, LLY), with healthcare flagged as a longer-term beneficiary.
• Key Companies: Market leadership remains concentrated in NVDA, AAPL, MSFT, and TSLA; potential AI capex beneficiaries cited include PLTR, VRT, AMAT, CAT, and GEV; trims included GOOGL and MSFT.
• Bonds and Rates: Yields remain range-bound (4.0–4.5%); bonds are oversold with a potential rally (TLT toward ~90) if oil/gas ease; any stagflationary rate spike would likely be transitory.
• Private Credit: Despite alarming headlines, credit spreads are calm; BDCs trade at NAV discounts with solid collateralization, and the guest is selectively buying while avoiding opaque, mark-to-model products.

Transcript

The big risk here is is right now is just we've got this massive deviation that's going on kind of in the markets. You know, we're so far deviated above the 50, 100, 200 day moving average. You're going to correct this. Um markets shouldn't trade this far away from their moving averages because their moving averages that it can happen. It's happened in the past, but you're eventually going to get a correction back. You know, you're talking about potentially a corrective action this summer between 68.50 and say 6,900 would not be outside the realm of possibility. Look, a 10 to 15% pullback would would not be out of the ordinary. Welcome to Thoughtful Money. I'm Alpha Money founder and your host, Adam Tagert, welcoming you here at the end of the week for another weekly market recap featuring my very good friend, the Italopilic portfolio manager, Lance Roberts. Lance, how are you? >> Yes, I love Italian food. It's the best. >> That's that's what this is about. All things Italy. And you're you're how many weeks away? >> Oh, I thought it was like I use italics a lot. So, >> yeah. No, literally it literally it means you like all things Italian. >> Exactly. No, we are three weeks. So little just like three weeks in a day. So we're >> now are you able to look forward to this trip with excitement or are you getting bitter about the trip because of all your calorie restriction? >> I am looking So like one of the days that we're there um we're actually going to a cooking class with an Italian chef. So >> fun. We're gonna make our home, you know, make homemade pasta, homemade pizzas, and yeah, I'm going to eat all of it. So, it's I'm looking forward to that part of it for sure. >> You're going to eat all the carbs? >> I all the carbs. It's gonna be like I don't want meat. I don't want fruits and vegetables. Just give me carbs. They come back, you know, 15 pounds heavier, but it'll be worth it. >> All right. Well, look, um, we got lots to talk about. Um and um I I so folks starting a week ago I officially joined Lance on the um the summer trim down program and I'll give some updates on that. But but more interestingly I've got a really big hack for anybody who's kind of looking to get into better shape as the summer comes along. We'll save that for the rant. Um but Lance, we got some new data this week and uh and you've also written some reports. I want to get to all of it. Um if we can let's let's start with the data. Um We we got another really surprising I think you could say blowout uh payrolls report again this year. Again, above expectations, higher than anybody thought. >> Um seems good on the surface. Um when you start digging below the surface, I think there's lots of things there that don't look nearly as good, >> right? Don't dig below the surface. Just go with the headline. It's >> just go with the headlines. Okay. Well, the the reason why I think it's actually important to talk about below the surface um is and I think we can debate and we can there's a legit debate that we had in the jobs market, but I want to I want to map it to or marry it to the data we also got this week uh of the latest yumish consumer sentiment >> which is I think the lowest it's ever been. Um it's just rock bottom. >> Yeah, discard that one. uh that whole starting about two years ago in particular the whole Michigan consumer index started giving a lot of false readings continues to do that because it's very politically biased and if you take a look at the the breakdown between Democrats and Republicans it's primarily that lowest reading is skewed by Democrats. >> Got it. So if you if you go look at a good a good counter indicator to that is go look at the conference board measure of sentiment which is it is weaker and that's that's really going on in the economy. We definitely have a slowing down in the economy and consumers are certainly under stress. No doubt about that whatsoever. But the consu the conference board index is a much better measure right now than University of Michigan because of the polling. >> Okay. Couple of things on that. Um you're taking it actually where I wanted to go with it. >> Okay. Um uh but folks uh you you've long-term viewers of this channel have seen me um interview Joanna Shu, the um woman who actually compiles the Yumish data. Um if you'd like me to have her on again soon to dig into the numbers and ask her why they're as low as they are right now. So yes, there's a there is a um political party skew to the results. I think that's sort of widely accepted at this point. Um but they keep getting worse. So even the you know the trajectory is still not good. Um so anyways folks if you're interested in me having her back on soon let me know in the comment section below. But but what was important about the current reading Lance is not so much its depth. And look this it's not a good timing indicator right? Um consumer sentiment has been pretty terrible for a good while here and yet stock market's back at alltime highs right so there's you can't make a lot of correlations there. Um, but what we are starting to see is that the Republicans in the survey responses, >> their sentiment is now starting to decline. So there there'd been a real alligator jaws disparity between the two. There still is, but in this latest one, the Democrats were still kind of bouncing below their bottom, but the Republicans are starting to come down a bit. So I think that's notable. And that obviously gets into the whole like how much runway does the administration have before the midterms to try to improve things economically? uh if they want the midterms to go their way. And that that's kind of a interesting topic we could get into here, but I wanted to marry those two, Lance, because um obviously poor sentiment um and a weakening jobs market would would mean pretty negative things going forward. We've got this kind of interesting situation where the headline numbers on the jobs market are good, but again, like I said, looking under the hood, you can find a lot of things to worry about. So, where where are you right now with all this data? >> Well, so two things here. I'm actually trying to pull up a a chart right now. Um, so this chart that you're looking at here is a composite index of both the Conference Board and the University of Michigan consumer sentiment index uh versus the S&P 500. So what's interesting is and and to and this is to your point Adam is that one thing we know for certain is that post 2022 when we really you know kind of started going through this whole you know economic shutdown and then revival checks household GBIS etc that things for the average American have not gotten a whole lot better even though the economy is doing you doing better at the headline and and the stock market is just going off to the moon it's fantastic underlying sentiment for most Americans has gradually get worse. And you and I have talked about this numerous times. You know, >> this this is the K-shaped economy. >> Yeah. Yeah. And and that's what's being really represented here. And so, the reason I like this composite is I'm not saying the University of Michigan is a bad index. I'm not saying that at all. I'm just saying you have to discount it a little bit because of that skew. And so one way to kind of offset that skew is to combine it with another index that gives you the same type of reading so you get a broader sample of people that you're that you're interviewing. Right. And so but you can even see here is that you know despite markets doing fantastic this year and to your point the sentiment the general sentiment is back to as low as it was you know really kind of late last year and it's it's not going up by any stretch of imagination. know the the trend is clearly lower for sentiment and you know certainly is is a function of what's happening economically for both jobs and you know take a look at today's employment report. Yeah, we did 115,000 jobs. We should be creating roughly about 200 to 250,000 jobs a month just to keep up with economic growth. Um so at 115,000 we're not even keeping up with population growth at this point. Um and but then also look at at hourly average hours earnings. were only up2% and average hourly earnings were only 3.6% year-over-year. Both of those were down from the last reading. So wages are declining. We're seeing slower rates of of of income growth really across the board across wage groups. And then you're looking at the savings rate for the average home, you know, home. You kind of the average family is at some of the lowest levels that we've had historically. So none of that says that this economy is just firing on all cylinders. And that that was really what you would expect with kind of this composite index. >> Yeah. Um so I noticed too in the looking under the hood in the data here the labor force participation rate continues to decline which you always bring up and that is not >> a sign of a particularly healthy economy. Um so you know what's interesting Lance is is um productivity has continued to increase and that's not a huge surprise and I think folks expect that to continue to to increase even further you know with AI and whatnot going forward. Um but that does raise a big question, right? Which is that if we don't see a pickup in employment to match economic growth is is that really just showing that the benefits continue to slide to capital versus labor and and that the jaws of the K-shaped economy will will widen even further? >> Yeah. Um and that's what you would expect to see. You know, we talked a little bit last week about my uh report on the robot economy. And you know, the people that own the robots are going to be and and own the means of production, their wealth is going to continue to grow. And for those that don't, their wealth is going to continue to really either stagnate or decline just because you're shifting the productivity kind of up the scale. And this is this and you know, it's interesting because look, there's, you know, you go into going to X, right? I mean, there's a lot of animosity on social media about the state of the economy. You've got, you know, one group of people that blame everybody else for their their their personal wos. Um, you've got, you know, people blaming the government for their personal w. I mean, everybody's blaming somebody for their personal wos. you know, nobody's taking responsibility for their own situation, but you know, that's but that's starting to eat through, right, to all these other indicators and and we're and we're seeing this show up is that again, consumer confidence index, etc. You're seeing more and more people starting to push down to those to those levels of frustration because the economy is not working for them, at least in their view. >> Yeah. And boy, I didn't know if I wanted to get to like one of these big social questions. so early in today's discussion. But um I guess two related questions. Um, I've said, uh, reluctantly a number of times, uh, it almost doesn't matter what the bottom 80% do, um, how they fare, um, because as long as the top 20% is doing so well that they can keep on on average the economy on the current trajectory, um, you know, numbers wise, it doesn't really seem to matter, right? Um, now of course you get to a societal point where enough people are struggling and I I don't you know I don't know what the exact breakdown is but I I think the paro rule rules the universe you know roughly 20% of people are doing great 80% or they're in the bottom leg of the K not doing so well. if enough of that 80% um not not only you know despaires of improving their station going forward but actually really starts to have trouble like putting food on the table dependably you know that's where you can really that's what social revolutions are are made of is is is this is this inevitable or avoidable in your mind >> no it's it it's and and look let's be really clear right we're not talking about the next civil war but what we are talking about is is that what is inevitable is that we're going to start voting in to Congress. More and more people that agree with things like universal basic income, more >> wealth redistribution, >> wealth redist redistribution, higher taxes, those type of things. You know, the rich need to pay their fair share. That all sounds great in theory. A, the rich already paid most of the taxes, and B, they'll just take their they'll take their assets and leave the country and go somewhere else. Um that's just because you know liquidity is fungeible. I can move it and we're already seeing that domestically right. So states which are passing wealth taxes and things like that are seeing huge hemorrhaging to the states that are >> very friendly. it is no problem to to move assets and but this this is all but this is all shortsighted right but that's going to be what's going to happen and and so I would expect over the next you know two three you know 10 20 years you're going to see a lot more of the voting start to push towards a younger skew of of individuals that'll come in with these ideas more socialist type you know projects those type of issues you'll get a very poor outcome from that and then over the next 40 years, you'll try to be working your way back out of it again. And you know, that's just but that's just the the the laws of nature and and economies and those type of things. Thank God I'll be dead, so it won't matter. >> Yeah. Yeah. Alth although we'll we'll according to your timeline, we're going to live through the descent into socialism. >> I think but you're seeing that now, Adam. >> Oh, no. I know. I know. But I I don't think it's going to be over in five years is my point. >> No, I I don't disagree. And this is why it's so important that you know, don't worry. Look, there's nothing you can do about that, right? There's nothing you can do to change that trajectory. There's nothing you can do to change that outcome, whatever whatever that outcome is. And I don't know what the outcome is. You know, we're talking about pretty dire stuff, right? But there's clearly a problem economically. And I and maybe AI solves that. Maybe AI works like Elon Musk says, and it and it gives a higher standard of living for everybody. That could very well be the case. Don't rule out that pro that possibility. I mean, we're seeing a lot of economic benefit from building out data centers where, you know, just recently we saw a GDP report 2% 75% of that was construction of data centers. That's creating jobs and increases in wages for those the individuals building it, etc. So, there's certainly some economic benefits. So, the world is not lost. Everything is not going to end and we're we're not all going to die. However, to your point, Adam, there's certainly a lot of people on the bottom end of that curve that are very frustrated. They're very upset and, you know, they want changes and and they're going to vote for those if if you start getting the right people running for office, they're going to get voted in, right? Because there's enough of those people that are frustrated and angry about the current about their current situation, even though most of their own current situation is their own problem, >> right? in their own doing, they are looking for somebody else to fix it for them. And that's how you wind up with socialism and and UBI and these type of things. But that's where we're headed to ultimately. >> Yeah. And it it it's interesting, you know, um history repeats or rhymes or whatever. Um and every generation sort of, you know, is is shaped by what it the experience it grew up in. And and look, I I'm a huge capitalist. Um that said, um I am not a fan of many of the monetary and fiscal policies that have been pursued over the past number of decades that have led to this >> growing wealth gap. I I think you know it it laid the seeds of its own destruction here as you're saying, Lance, right? >> The wealth gap gets big enough, people start saying, "Hey, we got to do something different." Um and likely we'll pursue the policies that you're talking about. You and I are old enough to know they're totally not going to work out, right? Um and then >> they don't the young people don't know that. >> No, they don't know that. But their children will then say, you know what, this was a terrible way to run things. You ran it in the ground. There's got to be a better way to do this and it probably will be. Let's return to the roots of capitalism and and and hopefully level playing fields and then we'll get to a better place there in the future. And this and this is to my point which is why we no matter what age you are right now, we need to start investing and saving and growing wealth to build our to build a a financial bunker so to speak. Right. >> To protect your family and your legacy against whatever outcome it is. Right. >> Right. You can't change the destiny of the country, but you can change your own destiny. >> Exactly. And so don't, you know, don't sit around blaming everybody else for your woes. start tomorrow figuring out how to save more money, how to get it invested, how to start building a financial cocoon around you and your family. And particularly if you have kids, this gonna be more important than ever. >> Yeah. And let let me ask you this, and folks, we're going to get back to the markets in a minute. Um, but this is an interesting thread to pull. Um, you know, just like the boomers uh were the free love hippie generation, don't trust anybody over 30, you know, um, and then they morphed into the yepies, right? greed is good. Money is I'm all I care about is money. Um >> do you think that there might be a shift in millennials and Gen Z who who are the ones that are pushing the the drive to dem to democratic socialism or maybe even just pure socialism right now as they start to inherit all that money from their parents >> all of a sudden wealth redistribution taxes start looking a lot less appealing. >> Yeah. Yeah. Yeah. There's a you know Reagan Ronald Reagan had one of the best lines. He said, "If you ever want to change a Democrat to Republican, give them money." So, you know, and that's and that's it's true. As long as it's everybody else's money, you know, socialism sounds great. When it's your money, it's a totally different thing. And so, yeah, this wealth transfer is is going to change a lot of attitudes potentially, you know, down the road. We'll see. But, okay, >> typically there may be some room for hope here if you're a fan of of capitalism of that. Yeah. They they may put down the pitchforks as they start that money starts coming. This is Adam, this is this is just to make a point about this. This is the thing that always irritates me about, you know, the billionaires and they go, "Oh, yeah, you know, Bill Gates was famous for this is like, yeah, I make, you know, I pay less in taxes than my secretary." Okay, >> that was Buffett, by the way. But yeah, >> sorry, >> that was Buffett, by the way. >> Oh, that was Warren Buffett, right? Um, but even Bill Gates made some similar comments about, you know, billionaires need to pay their fair share, etc. There's, do you realize there's absolutely nothing stopping you from writing a check to the US Treasury? So you feel like you need to pay more taxes, write a check, you know, stroke a billion dollar check and send it to the government say for payment on the debt and the US Treasury will gladly take your money from you. But they don't do it. You know, they talk this game, right, for notoriety and to be on the right side of the argument, everything else, but when it comes down to action, they don't do it. >> Yeah. And and look and folks, I'm not here to defend necessarily the billionaire class, but um the top 1% pays something like I don't know 47% of all taxes or something like that. And and and that that skew continues as you go down to the top 5% and top 10%. So that whole thing about paying your fair share, it's a very arbitrary uh declaration. Um and and the real answer is Lance, you know, you you you ask somebody who is on the wealthy red redistribution side, what is the fair share of of you know, the wealthy's um >> the income they should pay and they're and they're going to say 100%. >> Yeah. And just just to your point, the top I just Googled this real fast, but top 1% paid 38 to 40% of all federal income taxes and through the end of 2024. Uh top 5% accounted for 60%. Top 10% counted for 72%. >> Yeah. >> The top 50% paid 97% of all taxes. >> Yeah. And what's the bottom 50%? Do you have that stat there? >> Uh bottom 50% is 2.3 to three. >> Exactly. So >> they actually and the bottom 50% actually usually get money back. >> Right. Right. >> So >> or doesn't pay any taxes or to your point gets money back. Yeah. Um, so anyways, very slippery slope on this whole sort of fair share part because obviously if you're in fortunate to be in the top five or 10% there, you can say, "What are you talking about?" You know, I'm I'm already paying a big unfair share. >> Um, so you probably just enraged everybody on both sides of the economic spectrum here. But >> well, look, I just don't I just know I stroked a big ass check on April the 15th that I was not happy about. So, we all feel that way and and I wanted I I'd say this just to sort of correct the record. I think I put out a somewhat angry tweet on tax day when I >> paid my taxes due because it was it's always a bigger number than you expect, right? Even if you try to really plan, >> um just giving credit where credit's due. I got a check back from the IRS that was bigger than I I wasn't expecting a refund and and they said, "Hey, look, we did our math." You know, when they they say, "You here's your math. Here's our math. Give us more money." This was in the opposite direction, >> which is which is this is the thing that gets me, Adam. If they already knew the math, why didn't you just send me a bill that just said >> I know I know you say this all the time. >> Why do we have to play this guessing game? Just you already know what I made. just send me a bill and I'll just pay the bill. >> Well, and and I I I'll be transparent about this. So, I have um uh you know, there's my wife and I, we have our personal return. Then my wife has her therapy business. Then I have Thoughtful Money. I also have another uh holding company. Um so, we have to do a number of tax returns and have bookkeepers pay for it. And because we moved this year and we were doing, you know, California taxes and other taxes, um, it was a pretty big bill. It was it was over 10 grand. >> Uh, in terms of just accounting and bookkeeping and everything, right? So, to your point, hey, if you knew the number, save me the 10 grand. I'll just write the check for that and we'll all be done, right? >> The only the only saving grace is you can write the 10 grand off on your business. So, there you go. >> Yeah. Well, so anyways, long story short, I just as somebody who has complained an awful lot about this, I just want to give credit where credit's due. They actually sometimes do the math in your favor. >> Um, all right. Last point on >> last point on on this whole wealth divide thing and and I'll I'll alienate the few people who are still here and then we'll move back onto the markets. Um, you know, Lance, you you you often say, "Hey, um, you know, a lot of people who were bitching about their economic situation, it's because of choices that they've made." Um, and I I largely agree with that. I mean, I do, as as you and I have debated in the past, I do think that there are some headwinds that this current generation has that that we didn't have and that the boomers certainly didn't have. Um, but when you make those comments, Lance, you know, sometimes we'll get, you know, some blowback in the the the YouTube comments where people are like, you know, Lance doesn't understand and, you know, guy's way too cold-hearted and all that stuff, right? >> Dude, I understand. I lived out of my truck for three years. I >> I know we've talked about this enough. I think most people understand both of our journeys here. The the point I just want to make is um I mean I agree almost 100% with you Lance about look your your your financial destiny is your own personal destiny and you have to do what it takes to get there right. These are all based on choices and and being accountable for the choices we make. >> One thing I just want to I want to know and or we just want to say it. I'm not diminishing the many people out there who are frustrated for I think very valid reasons but um Just like the people who um you know will say America is the worst place in the world and this country is you know the evil empire and blah blah blah blah blah yet they still choose to live here. >> Exactly. >> Um you know I think there's lots of valid reasons to be frustrated and angry. There are lots of reasons to push for reform. I'm right there with you on this stuff. But I do think you have to sort of step back and I'm not even talking about the the the Jetson's future that AI might usher in for us and just say that, you know, if you're in that bottom 50% of America, in almost every case, you know, you have a roof over your head, you're getting enough calories during the the week, uh you have clothing and warmth and shelter. You probably have, if not a TV, a phone, internet connection. There's a lot of government subsidies that you can apply for uh to you know subsist um certainly above a starvation level uh diet. Um you you know most these people have on demand hot water. I mean, you you you basically are living at a standard that the average person on earth and certainly or the average American and certainly the average person on earth probably didn't live until say like the 1970s, >> right? Um it is it is an unbelievable level of of comfort and wealth. And look, I'm not saying it's all sunshine and roses. >> Back that all up because you're talking about just in the US. If you have all those things right now, if you have a car to drive to work, even though it's a piece of uh you live in an apartment that's a piece of crap, and you are struggling to make ends meet right now, and you're making minimum wage of $15 an hour, you're in the top 1% of income earners in the entire world, right? So, you know, this is this is the whole point is that we take for granted just how just how lucky that we are in the US to have all those things that you just mentioned because if you move to a lot of other countries, those things don't exist. >> Yeah. And let me just note this, Lance, to your point, just search this, uh, one in four people or two billion people globally lack access to safely managed drinking water. >> That's correct. >> Like, like forget about a car to drive to work and stuff like that. Just water you can drink without potentially getting sick and dying. >> Exactly. And then you know my point is is and look it's fine if you get frustrated like I don't you know Lance doesn't understand he's just cranky and cruel. Those type of things. A I've been where you are. I've I've I've been to where I've had nothing and I started out exact. I was young once. Seems like about it was a billion years ago but I was >> Yeah. I have a hard time believing that but okay if you say so. >> Yeah. You So, but I was 20 years old once and was working minimum wage jobs, trying to figure it out through college, you know, all that type of stuff. I've been there and done that. I've made all the mistakes. I've gotten myself into debt. I've gotten myself near bankruptcy. I've had businesses start and fail. You know, there there is nothing that you're experiencing in your life right now, and I totally wholeheartedly disagree with Adam when he says some things are tougher today than they were, you know, previous years. It's not true. Um, everything is tough for every generation because you all start in the same place. You have nothing and you're trying to figure out how to build something. So, you either have a choice. You can make really bad financial decisions today. Use buy now pay later to buy groceries with those type of things. Yeah, you you can justify those things. Well, you know, I've got to have the latest iPhone or I've got to have a computer that does this or I've got to have the best internet access at my house so I can play, you know, Call of Duty or whatever your video game of choice is. Those are choices. Those are not necessities. And if you choose to spend your money on that today, you will not have that money available growing for you to build you a better lifestyle tomorrow. Nobody got rich overnight. Nobody walked into this world and was handed a million dollars and said, "Here you go, bud. You're good to go." Well, now you get the Trump accounts as you if you get born, but you know that didn't exist. You know, people talk about houses. When you were back in the 80s, you had a 20% down payment on a house. Period. There was no choices. Today you need 3% to buy a house. So, do you have a lot of accommodations today to get yourself into financial trouble by buying things that you shouldn't buy? And then you turn around and complain to the fact that you don't have any money and the rest of the world's moving past you, but you haven't taken the actions to increase your education. Go get a couple of extra part-time jobs, work on the weekends, do whatever you got to do to create cash flow, get rid of debt structures as fast as you possibly can. Pay off credit cards. Start putting that money to work for you. And don't gamble it. You know, everybody's doing Poly Market and Koshy and all this kind of get-richqu stuff. 97% of those people lose money. So, don't do stupid stuff with your money investing. Invest properly. Have that money grow for you over time. And you'll work your way out of this and you'll move from the bottom 50% where I was to the top 50% of the economy where I am now. And you can do that, too. There's nothing stopping you except your attitude and your conviction to do it. >> All right. All right. I'm gonna um I'm going to end the two old guys ranting part here and and bring us back to the markets. Um just the the the key point I was sort of trying to get across. Um was, you know, if you're frustrated with where you are, you're you're, you know, really want to change your station, but you're not feeling good about where you are. I get it. I would say take Lance's advice there. There's all sorts of ways. Not necessarily easy. Um, but nothing worth doing is um, you know, pursue the the all the advice that Lance just mentioned there for you. I would just say try to have the mental shift of like, >> hey, at least I'm not at least I wasn't born in South Sudan, >> right? like you know just the fact that you're in a country like America or most people watching this are in some you know generally one of the G7 countries >> and and look I mean >> be very thankful that you're there because you have all these resources >> and opportunities you have all these opportunities to take advantage of in in the US that you don't have in other countries from education to to just basically capitalistic opportunities go start your own business become an influencer whatever you want to do you can't do that in other countries right you have that opportunity here to go take advantage of it and then nothing stopping you from doing it. >> Right. Right. Okay. All right. So, this is a market update show. People are saying, "Guys, where are the market stuff?" So, let's Why don't If you can Let's Let's >> Can is always never a problem. >> All right. So, let's go straight to the stake here. And this is my big question for you, Lance, which I asked last week and maybe even the week before. >> Can we trust this rally? >> No. That's why I have a bear up today. So, we have bulls and bears today. >> Well, you have a bear and a bull, just FYI. >> Exactly. That's what I said. I said, but last week it was just a bull. So, now I have the bull and the bear and eventually become just a bear. So, you know, we're migrating in that direction. Um, no, look, the the market's doing fine. But look, if you just take a look at here, let's look at the heat map today, right? So, the market's currently up about 70 basis points uh at the open today. It's Nvidia, uh, the semiconductors, Apple, and Tesla. Everything else is negative for the most part. >> Say this, this this looks familiar. We've seen this movie before. >> Yeah. Yeah. And this has been the case all week. And, you know, you're looking at this this this parabolic move. In fact, I'm writing an article for Monday on the semiconductor run, but you just got a parabolic move in semiconductors, and that will end badly at some point. Now, you know, a reversion to the mean, it may be 30 or 40%. And for those people that are buying it now, you're going to lose a lot of money. If you bought semiconductors, you know, back in February, uh, in a lot of cases before these massive runs, you're going to give up 30, you know, 20 30% of your gains and still be up 100%. Or more from the lows, depending on which stock you own. So, you know, it's it's for people that have been in the trade for a while, they're going to do fine and and they'll be okay. If you just got into this in the last week or so chasing this, there's there's a lot of risk ahead of you. But the whole market is gravitating higher two on two factors. The first is the market's gravitating higher price-wise because of a relatively small sector of the overall economy of the overall market basically, you know, the semis driving the whole complex. And so that's fine, but that's what's going on. And then on the other side of the coin, all the earnings upgrades that we've seen as of late for the S&P 500, which have been providing this kind of tailwind for the market to to push valuations, is primarily all coming from one complex, the semiconductors. Outside of outside of semiconductors and some of the technology stocks in general like Nvidia, Apple, and Microsoft, from the recent earnings reports, the vast majority of earnings for the rest of the economy are not growing. You know, if you take a look at, you know, the earnings complex, we're expecting 19% earnings growth for the S&P this year. Only if you strip out the top kind of the top AI stocks, the growth rate is 3% in earnings. So, it's it's a very big driver of what's happening in the markets and and that's eventually going to become problematic because we're going to price in all those earnings. Semiconductors, and this is the article for that I'm writing for Monday, is already pricing in 2028 earnings. So we're not just pricing in 2026, but also 27 and 28. So if anything happens, you have a supply increase of semiconductors or something else happens, there's a lot of risk to to the semiconductor uh space. And semiconductors are like commodities and they crash regularly like commodities. So you know, just if you ever look at a commodities chart, they have these huge runs and big crashes just over and over and over again. Semiconductors are a commodity and those will go through the same boom and bust cycle in at some point in the future. >> Okay. Um let me let me steal the screen share from you just for a second here. Um I'm going to replace you here. This is a chart that I pulled um off the internet and I'm sorry folks, it's it's real blurry. It's a small chart. So as I expanded here, it's I know it's really hard to read, but this is basically a chart of hyperscaler capex, right? So basically building data centers, buying uh semi stuff like that. And you can see here it went from around uh 250 billion in 2024 to 450 billion last year, a little over 750 billion uh or actually they projected um 800 billion this year. Um and >> if you I have a much better picture of that if you'd like to if you want me to share it. >> Uh fantastic. Yeah, please do. So my point here on this is um it's that to me I sort of you know that's the story that I think the market is currently trading off of right is there is just this thank you that's yes much better version of it um there's just this mega tsunami of uh capital spending on the semiconductor sector um and you know every quarter the analysts ratchet up what that spending is going to be and therefore the stocks keep going higher and higher. There's a couple things I want to take away from this Lance. Um one is if this happens right if if indeed all this money gets spent as these forecasts suggest I think this is a really big reason folks why it's going to be really hard for the economy to go into recession. >> Yep. as long as this is going on, you're you're just fighting maybe a historically unprecedented wave of of investment spending. Um, so it sounds like you agree with that point, Lance. >> Yeah, I actually if I I wrote an article um not too long ago, it's kind of mid last year and the article was titled why AI spending can solve the debt and deficit problem because you know one of the big concerns is like oh look at debt to GDP it's 100% of debt to GDP blah blah blah. Well, that's debt to economic growth. So, you have two choices. Either you can cut the debt or you can grow the economy faster, right? So, I can solve the the debt to GDP problem by growing GDP faster, >> right? >> And so, if you take a look at So, right now, um kind of the latest reading, we have about a 31 trillion economy, just call it 32 trillion. So, 32 trillion economy. You take the 1 trill116 mill billion dollar in capex spending multiply that by four. So now you've got about five trillion of multiplier effect in the economy on a 30 trillion economy. So that's five five uh five trillion on 30 30 trillion is what 20%ish >> say it's like 18%. Yeah. >> Yeah. 18%ish. Thank you. Um so that's that's not nothing right. That's going to certainly provide a decent tailwind to economic growth over the next and this is this is 2026 2027 2028 type numbers we're talking about. So this isn't some economic outcome you know 5 years from now. This is what's going to happen now next year and the year after that. >> Yep. So, um, so I just put that as a warning for, uh, the bears, right, which is if you're really expecting a, um, a recession to hit relatively soon, it's going to be hard for it to manifest with that wall of of money. That being said, to something you said earlier, Lance, if that money does not get spent the way that it's currently forecasted, if there's some hiccup in there, if there's something that, you know, prevents that spending from happening, boy, there could be a really big correction in the markets, right? Because that that it is currently priced for that mega tsunami. If it just turns into a regular tsunami or or or less, you know, that's going to take a lot of this market down with it. It will because that's going to affect earnings and you know so a lot of companies u their earnings say like a palunteer or uh avertive or applied dynamics you know these type of companies their their projections of income is from the data center construction. So while the hyperscalers are building the buildings, you got to remember all the companies that are that that money is not just going out to the ether, it's going into the economy and primarily it's going into the coffers of companies like Caterpillar that are providing the the the the tractors and the generators and everything else. the GE Vernovas, the Applied Dynamics, the the Verdives, uh the Vistas, you know, all those companies are that capital that's being spent is going onto their income statement and that's driving a lot of these earnings for these companies and and frankly that's why financials have been lagging, healthc care has been lagging. Uh financials relative to the S&P is at one of the lowest levels that we've seen ever. Um but again, they're not really the beneficiaries of that capex flow um as much at least from the market's perception. And there's obviously financing everything going through the the banks that they're benefiting from. Healthcare, you know, it's it's not the right sector. So, you know, it's been under a lot of pressure lately. Even though that's where all the job creation is is in the health care sector, and that's where the long-term benefits are going to be, isn't going to be in the healthcare sector as we continue to get older and need more services, those type of things. But just right now, unless unless a company like uh, you know, Abbott or United Healthcare comes out and says, "Hey, we're getting in the AI business tomorrow." Those stocks are probably going to languish here for a while. >> Right. Right. Yeah. Abbott just needs to put an I after the A in its name. >> Exactly. That that's a great point. Yes. >> All right. Well, look, can you pull back up the um the chart of the S&P? I think we teased people there. Um so the the definitely the rocket ride off of the bottom uh has continued, but as you said, Lance, um you are um looking at it with a skeptical eye. And obviously we talked about last week about um the overextended uh RSI that just continues to get even worse. That that rubber band gets stretched even further. >> Um so what is what if anything are you taking from the technicals right now and is it changing any of your positioning yet? >> Well, we we rebalanced portfolios a bit this week. So we took a little profit in like Google and Microsoft and some other you know some stuff that we bought back on April the 7th. we took some profits in and then we we did add a little bit of exposure to Rathon Technologies and to Eli Liy um because those are a little bit more defensive in nature. So if we get a rotation in the markets, money is going to rotate from technology to these other sectors and and that's really kind of a you know kind of really the key story here is we look at the performance analysis of of the markets themselves really on two different fronts. Um, you know, here's technology up in this upper right hand corner. It's at 0.93. >> Your maximum score is 100, right? I mean, is one, right? I mean, this goes from negative one to positive one. So, you can't get any higher than one and you're at 0.93. And so, just the extension of technology right now relative to everything else. And this is that bifurcation of the markets. You know, earlier this year, you and I were talking about the fact that um equal weighted index was outperforming the S&P 500 and that was that that that was that reflation trade that was going on. We were chasing commodity stocks and materials and industrials and those type of things. And so that equal weighted out performance was doing better than the market cap weighted because all the technology stocks were dragging and they were really out of favor. and and we warned then we said that's going to rotate and we're going to move from you know this kind of infrastructure dynamic back to technology which is what occurred right after the the April lows. So now we're getting that completely reversed again. So now we're grossly overbought technology financials, healthcare, communications, utilities, basic materials, energy, they are getting decently oversold here. So we may see and and again I I still suspect that my correction time frame remains in place which will be in the next couple of months or so that we're going to see this rotation out of technology back into some of these other sectors just a defensive kind of riskoff rotation and we're seeing the same thing if we look at factors. So the difference between the sectors of the markets are what make up the S&P 500 factors are things like small cap, midcap, large cap, emerging markets, those type of issues. And so when we take a look at at that breakdown, momentum, emerging markets, high beta, all of your risk on chase is extremely extended. So that's going to rotate back towards, you know, low beta volatility, dividend yielding type stocks, those type of things. So you'll see this rotation occur in the market. So but again that's going to be at some point when we start getting this kind of this blowoff top we're in right now begins to reverse itself a bit and it's going to show up in semiconductors but then it'll start to kind of eat through the rest of the the complex as well. >> Okay. So does that mean Lance your best expectation here is that um when that capital rotates um value stocks will outperform but the general market I have a hard time seeing the general market holding where it is with all the capital that's right now in you know those hyperscalers uh you know >> because because the the sectors that are driving the market right now this is technology techology, right? >> Yeah. >> This is the largest weighted sector in the S&P 500, >> right? >> So, if if let's just keep it real simple. Let's say that I rotate from technology to energy, right? Energy makes up 3% of the overall market. So, when that money rotates to that sector, there's just not enough weight in there to keep the when when the the the big sector comes down just by law law of numbers, it's going to pull the whole index down. So the index is going to correct even though money is rotating internally to all these other sectors. They're just so much smaller. If I take if I take a dollar out of out of the biggest market cap weighted sector of the index and then divide it between and put 20 cents in smaller sector five other small sectors, the market overall because it's market cap weighted is going to come down. But what we'll notice is is the equal weight index will begin to outperform, right? And that's what you're looking for when you start to see that equal weight index outperforming the the market the the market cap weighted index. That's where you're going to start to see that rebalancing occur within the market. So that's really kind of thing to watch for. If you just look at an RSP versus SPY and look for that to start turning back up, that's going to be your signal that we're getting that rotation. >> Okay? And that's what I wanted folks to realize here, which is that capital shifting from one side to the other, it's not necessarily a zero- sum game, uh, because of the market weighting dynamics that that Lance just walked us through here. And this also is a reason why active management in an environment like this can deliver superior returns than the passive just riding the index because here the index might actually get hit while some other parts of the market do very well during that period. >> Yeah. And and look, and the big risk here is is right now is just we've got this massive deviation that's going on kind of in the markets. You know, we're so far deviated above the 50, 100, and 200 day moving average. You're going to correct this. Um markets shouldn't trade this far away from their moving averages because their moving averages that it can happen. It's happened in the past, but you're eventually going to get a correction back. And and so just on a Fibonacci retracement, a pullback to the 20-day moving average is a 20 23.6% retracement. And you get a pull back to kind of the the the the 30% retracement. That's previous all-time high. So we should hold that support level. But if we don't, then you're sitting right on top of the 50-day moving average, right below that. So, you know, you've got some some good support levels, but you know, you're talking about potentially a corrective action this summer between 6850 and say 6,900 would not be outside the realm of possibility. >> Okay. All right. And what are we talking about right now? That's about 500 S&P points, 400. >> Again, that's kind of more extreme, but you know, look, a 10 to 15% pullback would would not a be out of the ordinary. And so if you're just talking about a pullback, you know, to kind of where supporting moving averages is, that's um that's a 7% decline to there. So that's not even 10% to get you back to the 50-day. >> Okay. All right. >> So I mean, it's not so corrections aren't the end of the world. There'll be and it'll it'll be a great opportunity if if you didn't buy into semiconductors. That story isn't over yet. They'll have a big correction during any correction process we have, but then you'll be able to add some semiconductors to your portfolio at a cheaper price. >> Yep. That that's that's the reload opportunity. >> Yeah, of course. >> Okay. All right. Um and so, Lance, you recently, I think actually just this morning, released a piece uh actually no, sorry. Uh this was earlier this week, you released a piece um titled market correction risk, why summer 2026 looks risky. Is it pretty much for those reasons that we just talked about? >> Exactly. Um you know, I I think that you're going to run, you got a few things that are going on in the markets right now in particular, which I guess we can stop sharing. Um so you know you're you're running into a few things right now that are starting to raise the risk flags and one is is a markets are really overbought. Second thing is is you got a real concentration in the move. So as the what's driving this market up is a very concentrated sector of the markets. Um breadth which is also leads into your breadth issue. So we have a good bit of problems with market breath being fairly narrow right now. Now, narrow breath by and of itself is is not problematic. That's it's it's certainly worrisome and it's something to pay attention to, but it's it's like a building block, and you need bad breath to be combined with some other things. And we're starting to combine bad breath with overbought markets, extended markets, a lot of speculation. We're getting sentiment back to very bullish levels. Those are all good kind of setups on a contrarian basis for the market to go through a correction. In other words, we're getting all the buyers in one room and there's very few sellers left in the other room. And so eventually at some point there's going to be a buyer that holds his hands up and says, "Yeah, I think I want to sell some stuff and everybody's going to run in the other direction." >> Got it. Okay. All right. Well, folks, we will be tracking this on a week- toeek basis going forward, so you know where we are in this story. Um, all right, Lance, I want to move on to a couple other topics. Um, >> one of which is bonds. Just know that that's coming. Um, on Iran, I just want to ask um I mean there's still so much we could talk about there, but uh I I moderated a debate on Zero Hedge last night and one of the participants, a gentleman named Adam Parker, um he made a case that the the price of oil is going to remain elevated for a good long while um even if a peace deal breaks out tomorrow. And you don't necessarily have to agree with that or not, Lance, but um are you becoming any more worried about the longer term economic impacts that the closure of the Gulf um may have on the on the econ the global economy going forward? >> Yeah. Well, you know, I've been last week we talked about kind of the the time frame on the markets. >> Um so, yeah, the longer that we keep oil prices elevated, the more risk you have economically. That's just a a function of math. So yeah, if we don't get this corrected within the next couple of months, the the impact on the economy from four or$5 dollar gasoline becomes much more impactful to consumer dynamics, etc., which is eventually going to flow flow back through into the markets. And that's why, you know, one of those kind of layouts we went through last week was that, you know, you know, if we start getting into that type of environment, this thing just keeps dragging on, dragging on, dragging on, and we're four, five, six months down the road from when this started. So we're two months in now, right? So another four months. That's where you start getting that setup for a much bigger correction. So instead of having a 5 to 10% correction just to work off overbought conditions, you're now talking about a 15 to 20% correction to work off a reduction in earnings estimates because now you've got recessionary risk rising. >> Okay. Um, I guess my question is just from that conversation we had yesterday uh last week, have you seen anything in the inter room that makes you more worried or less worried about this risk beyond the fact that we still don't have a peace deal? >> But but don't have a peace deal. I mean, we we've won the war 38 times. You know, I interviewed Thomas Thornton yesterday, so I've got a really good interview coming up with him. Um, but as he said, we've won the war 38 times now, and the market's holding in there at the moment, but eventually the high the high price of gasoline. It's not oil. Oil prices are not the problem. Oil prices are oil prices and that's just kind of in the futures market. What's what's problematic is the gasoline because that's what cons you know, consumers don't go out buy a gallon of oil today, right? They go out and buy a gallon of gasoline. that's transferring $600 to $800 a year from other spending to pay for gasoline. And so that's your problematic. So as long as it stays elevated, the higher the risk is that that impacts your economics. >> Okay. Um All right. I'm resisting a rant there, but I'm I'm going to resist it for for for now. Um All right. So you you put out a piece this morning titled Commodity Super Cycle, the Enemy of the Bull Thesis. And I'm sorry I have not had a chance to read it, but I want to give you a chance to talk about it whoever you want. Did you title it the enemy of the bull thesis part one because your next one's going to be the enemy of the bear thesis? >> No, no, no. So, it's it's it's a fairly long piece, so I had to break it down into two parts. But it's talking about there's a lot of of arguments right now, people saying, "Oh, we're in the next commodity super cycle and commodities are going to, you know, just go to the moon and they're never coming back again." And that's not the way commodity cycles work. So what this article goes through is how commodity cycles work. What causes the inflation and deflation of commodity cycles? Why, in other words, why do commodities regularly boom and bust, right? There's never a consistency. And so part one really explores that point. And then part two will get into kind of where we are now and kind of what the next phase of this cycle is and then how it eventually ends and how investors need to be preparing themselves to invest for it. >> Okay. Um All right. And folks obviously can go read that on realvestmentadvice.com. >> Yes, of course. Or on Substack at Lance Roberts. Either way. So, >> okay. All right. All right. So, bonds, um, been getting some requests over the past couple weeks for us to do a revisitation because I don't think we've talked about it for a couple weeks. >> Um, first off, um, where are yields right now? Where where are they headed in your opinion? >> They seem still pretty much stuck in this range between, you know, 4.0 0 and 4.5%. >> Yeah. I mean, you know, we yields haven't gone anywhere. Um, you know, this so this is TLT, so this is bond price. So, but this is the inverse of yield, >> right? So, just flip it over and it's yield. >> Um, but basically, we're about where we were price-wise on bonds back at the beginning of 2025, despite all these headlines, everything else that's going on. Um, and the reason for that is is that, you know, when I'm loaning money, so that's all a bond is, right? Right? I'm just loaning money. As a as a as a lender of money, I am looking at several things. One, what's the potential of getting my money back at maturity? What is the rate of inflation that I need to offset over the next 5 years or 10 years or whatever the length of my loan is? So, if I'm making a 10-year loan, what's the what's going to be the rate of inflation 10 years from now? So, I look at inflation expectations for that. Um, what's my opportunity cost for loaning that money for the next 10 years? um is there another place I can invest it better and of course the the like I said default risk uh uh rate risk all those type of things. So the market is is is continually pricing in all of those things. So this is why you just throw out narratives when people come up with narratives like oh interest rates are going to go to the moon because of a b or c reason throw it out the window because market's already pricing that in. So, whatever the market's telling you today, that's what the market's pricing in. And particularly on a 10-year Treasury, actually, the TLT is a 20-year Treasury. That's what that's what the Treasury market's pricing in over the next 20 years. So, what the expectation is is that inflation is going to remain subdued around 2% ultimately. Economic growth is going to remain around 2%. Add those two together, I'm at 4%, which then I add on a bit of a premium to that on top of that two two and two. So I have growth at two, inflation at two, that's 4%, add on a bit of a premium. So that's how that's how I get to 4.2 4.3% because of where oil prices are. So all that so so the bond market is consistently telling you that that's what's going on economically. Now just from a investment perspective, bonds are very oversold here. Um we're turning up on a buy signal. We're probably going to get some news in the next month. And any type of news that we get that suggests some type of clearance to the straightforward moose and oil supply coming back online, you're going to see a fairly decent rally um in yields back down towards 4%. That'll put you up at about 90, you know,ish on TLT. So, it's a decent it's a decent trade setup if you're trading bonds. >> Okay. Let me ask you this. So, um, move your cursor to the right to the the the um in between where you were in there. Uh, the the the the local high there. So, yep. Straight up. Nope. That the one before >> here. >> Nope. Other direction. >> This direction? >> Yep. So, right there. Okay. So, I understand everything you just said. Um, how concerned, if at all, are you of just the trajectory here? When when is that? Are you in November of last year? Yeah, that's that's late October, early November. Yeah. >> Okay. So, you know, if you draw a line down from there to where we are now, I mean, the momentum is to the downside. It sounds like you think there's going to be a a near-term local bottom and reversal with that good news. But are you concerned at all that this is a trend that may continue in the longer run further down from here? >> Probably not. And the reason is is again mark. So could interest rates go higher from here? Yes, of course. And what you'll need for that is you'll need very strong inflation to start to show up, very strong economic growth. And if you get those two things rolling together, then yeah, um three, you know, you know, put a five handle, six handle on Treasury rates. >> Sorry to interrupt, but what if you got very high inflation but lower economic growth, right? the stagflationary outcome that some think is coming because of the closure of the this trade and whatnot. >> So if you have high inflation and no growth, >> inflation can't stick, right? Because the growth is what drives your inflation. So if you have a so this is what you saw back in uh 2020, 2021 when we shut down the economy, you had no economic growth and you had a you had 9% inflation, right? Because that was all that money being injected into the system. Mhm. >> But that wasn't sustainable because as soon as you opened back up the economy, you started flowing that money through the system, it was all set to reverse, which is exactly what happened. So if you have a temporary oil price spike, that is certainly going to cause inflation and that's going to impact economic growth, cause a recession. So you may have a temporary run up in interest rates because of the spike in inflation, but then it collapses because of the recession because that's drawing all the demand out of the economy. Again, the cure for high prices of oil is high prices of oil. And that's eventually going to resolve itself. And again, there's no again, we I've talked to both myself and my partner Danny Ratliff. We've talked to a lot of we have we're in Texas, right? So, we have a lot of clients in the oil industry and they are, you know, we talked was like, why aren't you drilling? You know, what's going on? What do you expect to happen? And by and large, most of them expect oil prices to be much lower by the end of this year. And so that's why they're not if you take a look at Baker Hughes uh number of of wells, they're not rising, right? You would think with high oil prices, everybody could pop in a well right now. But I wouldn't drill a well today if I expect oil prices to be a lot lower, you know, six months from now or eight months from now, right? So, so all this is going to so all that weighs back on itself and it shows up back economically and anything that you have that is deflationary to the economy that's going to drag rates lower. >> Okay. But just just to make sure I heard you correctly. Sure. >> If we do get a stagflationary period, right? >> Likely higher yields for that, but it'll be transitory because they will then drop as demand destruction occurs. >> Yeah. And look, there there's a really important point about this and I need a different chart here. Hold on. Let me ah this this will work. Um you know when you start looking at Yeah, this this will work. This is this chart goes back to 2002. This is a monthly chart of interest rates. >> Mhm. >> Right. And so we have exceptionally so again you flip this over upside down for interest rates. But, you know, we have exceptionally low interest rates and everybody's talking about this r. We've had this rise in interest rates over the last few years and it's like, oh my gosh, you know, interest rates are so high right now because we should have never been at half a percent on interest rates >> back in 2020, right? >> Remember remember 38 minutes ago where I said, "I've got lots of problems with monetary and fiscal policies." >> You and me, you and me, buddy, we're on the same page on that. Lots of problems with monetary policy. But you know what we have to remember is is that the average interest rate for the US economy going back to 1980 is about five and a half percent. >> Now if I'm loaning money to anybody for 30 years, I should probably want at least five or 6% on that money. I mean I could invest in the stock market and make more money than that, but if I'm loaning you money for 30 years for a mortgage, why would I do that at 2%. It really makes no sense. And this is what's caused the problem with the housing prices, etc. you know, no money down, 3% downs. We've gotten used to exceptionally low interest rates, which allows us to buy more house than we can afford, and that's caused this price elevation in the markets. But we got we think somehow people in the the market and the media think that the interest rates we saw back in 2020 were normal and that we should have near zero interest rates. That's not normal. And a it's it's it's not normal and b it's not economically good. You need interest rates between four and 6% to promote healthy economic growth because money's got to be invested to generate a return that creates more economic activity. So we should be we should be looking at four and a half to 5% interest rates is like okay we've normalized interest rates. This is where we should be. I go buy a f and and think about it from an investor standpoint as opposed to 2020 when I could take a million dollars and buy a 10-year treasury and make, you know, $5,000 on it, you know, at half a percent interest for a year. You know, that was one thing. But now I can take a million dollars, I can buy 5% treasury and I can make 50,000 a year on it to to supplement my income. And so I'm actually getting paid for the loan risk that I'm taking. We should be grateful for that as investors, not worrying. It's like, oh my gosh, interest rates are so high. The the the world's imploding. No, we're just at normal levels. This is where we should be in terms of interest rates, economic growth, those type of things. >> Okay. So, um, credit spreads, what are credit spreads telling us right now? >> Nothing. They're not moving at all. So, you know, there's, you know, we we talked about this before. Let me bring up a chart on credit spreads. Um, you know, it's just it's just really kind of phenomenal that if you take a look at a lot of these credit spreads, they're just sitting down at Lowe's. Hold on, I got to share my chart with you. So, yeah, this is double B. So, this is basically junk bonds at, you know, there's no increase in that. If we go down to single C, nothing has really moved. um they're basically kind of the same place they've been just kind of trading up and this is this is C-rated bonds you know tripleB rated or at the lowest levels that we've that we've seen. So so again you know credit spreads are you know they're not you know all this concern about private credit everything else it's not showing up in the credit spreads yet. >> Okay >> not saying it won't it's just not yet. Yeah, that was my last question for you on private credit. Um, you the headlines still you I've talked to a number of people of late who um and and the experts I interview are definitely divided on this. There are some uh that still think that private credit is going to be a very big shoe to drop. Um, and uh, there's a bunch of others that are saying, "Oh, it's been really overblown and this is actually a really good time to go out there and snap up some bargains, especially in the like, you know, BDC space, the business development company space." >> We're we're we're buyers in that space. >> Okay. Um, but the headlines still continue to be kind of kind of grim. Um, but you're you're I mean, obviously the the bond market is not sending a warning signal yet, >> which should tell which tells you a lot, right? if this was really the the size and the magnitude that you know kind of a lot of the the more bearish crowd wants to make it out to be credit spreads would show that but they're not and that that tells you a lot about that look this is a 1.7 trillion problem it sounds like a lot right it's like 1.7 trillion you have to remember subprime was 62 trillion so just from you know just from the size and magnitude 1.7 trillion it is a Not if it all blew up, which it's not. If it all blew up, it would certainly ding the banks, but >> it's not going to put anybody out of business because this is spread out. Most of this is high. Most of this belongs to high net worth investors. >> You and so they can absorb the losses when it occurs. It's not going to crimp consumption to any large degree. Most of these are big boys playing in the It's about 20% of its retail investors. they're going to get hurt, but that's not a big enough component to cause a major market meltdown, >> right? It's just just it's just literally the size isn't there and the leverage isn't there. Um, just for instance, one of the BDCs that we own is 98% collateralized >> and they traded a a discount to NAV of of basically at 92 to NAV. So, you know, when you start looking at, you know, the underlying credits for a lot of these, yes, there are certainly some loans at risk, and those will probably go bad. A percentage of these loans will probably go bad. Most of them won't. There's going to be some price markdowns for people that, and this is why, look, I'm a I'm I'm a big advocate that if you are an individual investor, you should stay the hell away from private equity, private credit, just for this reason. >> And you know, people pitch this stuff to you all the time. Oh, it's low volatility, has higher returns. That's because it's all marked a myth, right? When they have to mark the market, it's an entirely different story. And you know, that's what we're going to see a lot of. And there's going to be a lot of people that take a hit on this stuff, take a ding. They're going to get out of it at some point, but it's probably not going to be, you know, the impact to the overall, it's not going to be the next subprime crisis is what I'm trying to get to. >> Yeah. Okay. Um, and you have said that before. Um, >> I want to just connect two dots to previous videos. one um Yan Banek when he was on a couple weeks ago delivering his latest um quarterly outlook uh talked about how he thought there were some pretty attractive um discounts in the the publicly traded BDC fund space and he had a really interesting chart there where he said you know these things if you look at at well back when he created that chart he said if you look at how discounted a lot of these big funds have have become that basically is pricing in like a I don't know 30 40% default rate on their portfolios >> and then he pulled up the actual reported default rates right now in in the private credit space and they hadn't budged. >> Yeah. >> So he's basically saying like you know uh the worries seem very overblown for the damage that's going to happen in this space. Now again, folks, maybe that that that damage is still to to happen in the future, but you're not even seeing, at least from his chart, a pickup in the trajectory of defaults that you would expect given all the the crazy headlines that we're seeing. >> Well, Adam, you remember, you remember Meredith Whitney? She was the bond guru that kind of called it during the financial crisis and then she started on this whole kind of discussion about MUN bonds were all going to fail and it never happened, right? And >> so, you know, it's very important to understand >> and then we haven't heard about Meredith Whitney for 10 years. >> Yeah. >> As a result, >> but you know, there's it's very important. This is why, look, you may agree with me or disagree with me on stuff and it's completely fine, right? Because all I'm doing is looking I I I do my homework. I I pull organic data. I do the analysis. I don't put anything out there for you that's hyperbole or just madeup stuff, right? Trying to grab a headline. I mean, everything that I produce for you guys and we talk about here on the show is all data driven and I don't have a dog in the hunt. All I'm doing is managing money. So, I'm just trying to make the best decision I can make about where to invest my client's capital because I can't afford to lose it. If I lose my client's capital, I'm out of business and I kind of like our business. So, you know, I like and I like keeping our clients happy. So you can you can disregard or pay attention to what we're talking about here, but just understand that most of these narratives that are running around, you know, that we've talked about here on the show before that are the kind of the more scary doom and gloom, the world's going to end, everything's going to fall apart is probably not going to be the case. That's a very lowrisk prob probability. Um versus the the much wider ranges of possibilities that are most likely to occur. In other words, I think the world's going to end tomorrow. It's probably not going to be the case. But could it get damaged? Absolutely. And is there something else that's going to happen? Or could it actually be better than I expected? Yes, that's a possibility, too. And so, always keep in mind that the most dire predictions historically, I'll give you a good example. Um, there was a a story out yesterday talking about how the US is going broke because of its debt. And just looking at the debt, 40 trillion in debt. The US is going broke. 1970 Times magazine cover article graphic is the US going broke. >> Right? That that narrative has been around since 1970. Actually, it's been around since 1940 because Warren Buffett's father Harold was also making claims that the US was broke because we had 50 billion in debt at the time. So, you know, these claims have been around forever and yet the US economy is still here. Markets are all-time highs. And how much money would you have lost trying to avoid that narrative, you know, being true? How much money would you have lost? How much wealth building would you have lost worrying about it? That's something you can't control versus managing your money, understanding what that risk is. And maybe you believe that risk to be a real risk, but it's not going to happen today and it's not going to happen tomorrow. And we're gonna and if it ever does come to fruition, the market's going to give us plenty of time. We're going to know about it for, you know, months, quarters, years in advance before that ever happens. You'll have plenty of time to get out of the way of whatever that debt calamity or whatever the narrative is is going to be. The markets will will be way ahead of you, and if you just pay attention to the markets, you'll be able to get out in plenty of time, preserve your capital, preserve your wealth. But don't forget about the importance of building wealth between now and whenever that happens. >> Yeah. And let me let me just add on to that, which is um you know, I got pulled into this world in the early 2000s. Um I mean it was housing initially that brought me in, but very very quickly it was the articles about our our debt situation and how that was all going to end poorly in the future, which I think odds are it will, right? But back then it it, you know, as I was getting exposed to this, it felt real imminent, right? And um I I've learned over time, like you said, Lance, hey, this this system is doing everything it can to preserve itself and and um you know, keep the status quo. Um and it will highly likely be able to do that for much longer than I expected to. So at some point I shifted from kind of disaster prep to well is there a way that I can let this system work to my advantage here that I can let this mounting eventual debt crisis work to my advantage? And two big conclusions that I came up with was well as long as we deficit spend um that as it happens is going to stimulate the economy and stimulate certain sectors of the economy right. So, let me ride those trends in the near term as they're going on. And in this long arc, you know, even though it's going to take a lot longer for the ultimate, you know, end to all this that I think is is going to happen, one of the things I've got the strongest conviction is is that the currency is going to be devalued along the way against assets, right? So, what assets are going to benefit from that? And obviously that's one of the reasons why I've been a big fan of hard assets, but it's also why I'm still invested in stocks, Lance, because those things will benefit from that trend. >> Exactly. I mean that that inflation is going to occur over time and as inflation occurs because of economic growth, you know, as we talked about before, holding a dollar in a jar is going to lose purchasing power. So that's why it's incumbent on us to invest our capital in assets whether it's gold or silver or stocks or bonds or whatever it is that generates a return on that investment. But the the important factor though is is we need to make sure like right now that that rate of return is at least 4% or higher because inflation is running at say three and a half%. So I need some I need some rate of return over inflation to preserve my purchasing power over time and to increase it. I don't want to keep, you know, I don't want my purchasing power to stay flat. I want to have a bit of an increase over purchasing power. So, I can buy a 10-year Treasury and get 4.35 right now versus three and a half inflation. That's doing the job. It's not great, but if I want to buy stocks, I'm making 20% a year. If I buy gold, whatever, you know, I'm I'm making money. So, yeah, it's it's it's crucially incumbent to make sure that we're taking our hard-earned capital and and investing that for our future. >> Yeah. And I I'm anticipating, Lance, there's going to be some comments here of people saying, "No, guys, you don't get it. This whole system's a house of cards. It's going down tomorrow." And could it? Yeah, maybe. Um I'm with Lance and and saying that the the market is going to give us warning signs before we wake up and and the whole system is has been, you know, gone through a reset. Um >> and I just want I what I just want to say and this is important. And I think you would agree with this, Lance, is is I've been at this long enough and Lance, you've been at it longer than me >> where I have seen it many different points along the way where people have >> reached out to me or commented in response to something I've said and said, "No, no, no, Adam. This thing is going down, you know, imminently and they have shifted their assets dramatically into bunker mode because they were just so certain that this couldn't last another six months or less, right?" Yeah. >> And then as has happened, you know, the world went on, the markets recovered, and they found themselves with that in that really tough position you talk a lot about is, you know, okay, well then when do I get back into this market? Well, it's already moved on from where I was. I got to wait for it to pull back to get to to where I sat this out. Oh my gosh, it didn't. And then you start basically just watching the world move on without you. Um, or even worse, I've seen people take on like aggressively short positions, right? and then just have their wealth vaporized by this. And I'm not saying if you really feel uncomfortable, you know, there's nothing wrong with playing defense, but just be aware of of of the dynamics of the system as we're talking about them and don't take such an extreme position such that if the system continues for longer than you think it's going to that you get wiped out. >> Yeah. Look, I mean, you know, this like I said, so 1970 time cover article, world's going bankrupt. 1982 83 Ray Dallio we're going bankrupt it's imminent and you know he's still tooting that same horn here you know 25 years later 30 years later actually longer than that now you know he's still kind of on that game so you know these predict >> to be clear I don't necessarily think he's wrong it's just a matter of time >> it's just but his timing I mean again he said this in 1980 he's still saying it today and yeah maybe someday it'll come true but it may not be in our lifetime right I mean it may be a hundred years from now maybe it But you know, this is the thing when people talk about the debt, it's like, "Oh, the US has 40 trillion in debt. We're at 100% of debt to GDP." Okay, if you're worried about that, explain Japan. 280% of debt to GDP. Still here, still going. Yeah, they got problems, you know, and and the result of high debt levels. Look, and I'm not a big fan of debt at all because it leads to disinflation. It leads to slower economic growth. It leads to poor economic prosperity. In other words, a worsening K-shaped economy. Yeah, that's the function of debt because all that debt, both corporate, household and personal, diverts capital from productive investments that make us money, make us wealthier into debt service. So, yeah, there's a there's a negative side to debt, but just because you have debt doesn't mean you're broke. That's like saying this, Adam, you got a mortgage on well, you rent, right? So, do you have a do you do you have a loan on anything? Do you have a car loan? >> I don't actually, thankfully. Okay. Well, you you just screwed up my old example. So, but let's assume that let's assume you've got a mortgage. If I just looked at if let's say Adam had a mortgage on his house and I said, "Adam, do you have a mortgage on your house?" He says, "Yep, I got a $200,000 mortgage on my house." I go, "Well, you're broke. Why? Why am I broke? I have a $200,000 mortgage." Well, you've got debt, so you're broke, right? That that's when we look at GDP, when we look at debt, we say, "Well, we got 40 trillion in debt. We must be broke." Well, no. You that's just a balance sheet item. That's the liability, right? You have to also look at the assets on the balance sheet. So, I go back to Adam. I say, "Well, Adam, you know, you've got this $200,000 mortgage. What was your income last year?" He says, "I made $100,000 last year." Okay. So, you've got enough income to service that debt, right? But but but wait, Lance, I also have $400,000 in assets in various things, right? So, >> sitting in the bank, just saying. >> Yeah. Sitting in the bank, I've got equity in my house, you know, whatever it is. So, we have to compare things to the actual balance sheet. And when you take a look at the balance sheet of the United States here, I'm going to show you a graphic. I posted this yesterday, and it's amazing how many people don't understand this. The comments were hysterical because people don't understand basic accounting. This is a chart of just natural resource value by country, right? Russia 75 trillion. in the US 45 trillion multiple asset you know multiple different types of natural resource values coal timber natural gas gold sorry to interject is this just like deposits under the earth h how how is this being valued do you know >> yeah this is this is basically just the the total estimated value of the deposits that we have >> okay >> right doesn't necessarily mean it's mined and sitting in a bank somewhere >> y >> right the point about this is is that the US has assets Just in natural resources 45 trillion. So just in natural resources we have more natural resource value. We have an asset worth more than the debt that we have. Now again that's just natural resources. Now we we can talk about the military. We can talk about public public lands public real estate uh government buildings so forth and so on. All the different various assets that the government has. Plus, the government has nearly 5 trillion dollar dollars a year just in revenue coming in from taxes, tax collection, and everything else. >> So, if I look at the balance sheet of the United States, I go, "Yeah, you've got 40 trillion in debt. You're leveraged, right?" So, this is basically me going into my investment account and I've got $100,000 of equities and I pull on, you know, another 50,000 in margin. So, now I'm a le and now I've got a leverage play on the economy. And again, as as as Adam pointed out so eloquently earlier, all that all that debt is not just debt. That is money that has been created through lending because that's how money is created. Money is lent into creation that then flows into the household balance sheets. It flows into military paychecks. It flows into the companies that are building the military assets that we use from tomahawk missiles to ships. It flows into the corporations that are doing construction, infrastructure project, etc. It's flowing into government employee plays that are then being used to spend in the economy. All that money, that 40 trillion in debt has wound up in the economy, which is creating economic growth. And that's why when you want to look at M2, you look at M2 as compared to the growth rate of the economy. And the economy is growing faster than the money supply itself. And that's because the economy is growing which requires more money to be invested in the economy and you know so so that's just you you got to look at these things. If you're worried about 40 trillion in debt that's great I understand that. I'm not a big fan of $40 trillion in debt because I know what happens economically from that. But it doesn't mean by any stretch of the imagination that the economy that the US is broke or it's going to fail at any term because if you can't explain Japan, you can't explain that. >> Yeah. Um, so I think I I I agree with your everything you said there. Um, it's interesting Japan was not in that list. What I have heard is that Japan has been able to to subsist for as long as it did was because it was so ferociously wealthy >> during the uh during the 80s um that it uh and and you probably remember this Lance I mean it was buying up assets all around the world particularly here in America right? >> Yeah. We were selling it. We sold our sold as Japan. >> Yeah. Well, but it it it kept that portfolio and has been sort of slowly liquidating that portfolio. I don't know how much of it's left. It could be a lot. I don't know. But I think they they had the advantage of having a just an unbelievable amount on the asset side of the balance sheet. Um if not necessarily in mineral resources in Japan, but in the rest of the world. And that has really helped helped them through. >> The US is the same way. Again, I just pulled up that one chart just, you know, it said, "Look, if you just look at natural resources, we have more natural resources than we have in debt." >> Yeah. >> So, from an from a from a my point was, and this was the point of the post is that you can't look at debt. You have to look at the balance sheet, right? Just looking if I just looked at your >> or even better, you have to look at the equity side. >> Well, yeah, that too. But yeah, if I just looked at your balance sheet and said, "Oh, you've got a mortgage. You're broke." You know, a bank would never loan anybody anything, right? So you you have to look at these things in totality. And the whole point about the the conversation is that there's not a lot of support for the doom scenario cycle of the government debt. It's just there's just not a lot of support for it. >> Okay. Well, again, we'll get some valid push back on this. >> Happy to have push back because challenge it. >> I don't have a chart handy, but but you can easily find this online, folks. If you look at the the growth in debt, US debt, um compared to the growth in GDP, um I think since like the 70s, the debt has been growing way faster than GDP. At some point that will really matter, right? When is the big question. And I think what Lance is saying here is is could happen 10 years from now, could happen 100 years from now. From the best we can tell, it doesn't look like it's going to happen a year from now. Um, so just be, you know, be cautious about how much you let your concerns about that influence your decision-m today. >> Yep. >> Um, okay. Uh, well, Lance, this has been a good one. So, trades, uh, you said you did some rebalancing this week. Anything else besides general window dressing? >> Yeah. Yeah. Yeah. Just just, you know, kind of, you know, again, you know, like I said, bull bear today is just getting a little bit more concerned about this rally. It's getting a bit narrow, getting a bit extended, getting a bit overbought here. So, just did a little bit of nipping and tucking right now. So, this is just kind of that first step. You know, we we like I said, we kind of just trimmed off on some of our tech stock, excuse me, some of our tech stocks that we bought recently, add a little bit more to defense, and you know, and I think that probably over the course of the next few weeks, we'll see how the markets do that we may need to do some more of that and raise cash. Right now we've got about 15% cash in portfolio. So we've already got a good little buffer. Um we're a little bit underweight bonds. Um little bit underweight stocks, not not to a great degree. Um so we're holding a good bit of cash right now which is giving us >> Is it underweight stocks? But you haven't changed your equity exposure since last week. Correct. >> No. No. It it reduced by about 1%. >> Huh. Okay. >> It was it was it was pretty mean. The >> Was that intentional or just a factor? >> No, it was it was just a function of that we were adding some and selling some. So it just we sold a a tad more than we then we just kind of rotated with them. >> Got it. But it's not like you and Michael sat down and said, "Okay, we get a reducer equity exposure." You're not there yet. >> Not there yet. But that that could, you know, if we start triggering some momentum sell signals, which we're very close to. Um, you know, that could certainly be the conversation we have next week. >> Okay. All right. Well, again, you you've you've added the bear to the picture behind you. Um, >> eventually it'll be just bear when we get there. I was going to say, folks, a big indicator will be the week, whether it's next week or whenever, when Lance just has the bear behind it. >> Exactly. >> Um, you should keep that going forward. I think that's actually a really nice indicator. >> Okay, I'll do that. >> Yeah. Um, all right. Well, look, as we as we wrap things up here, um, two quick things I wanted to talk about. Um, Lance, you had mentioned, was it last week? Yeah, it was last week. Um, so folks, we we talked about GLP1s. Um, and a lot of folks said, "Hey, yeah, get a specialist on there to talk about that." So, I've noted that, folks. I haven't reached out to I haven't identified a specialist yet, but I I will bring one on given that you so many of you said you'd like to see a discussion on that. Lance, you said you were take you were micro doing them largely because um you believe from research you've read that um they can help put off dementia and uh Alzheimer's. And I think you said that that runs in your family. >> It does. >> Okay. So, one thing I just wanted to note about this, I was I was sort of thinking about that um afterwards and first I thought, "Oh, dementia. That totally explains how strange Lance is." So, thanks thanks for giving me that that that explanation. >> That that just explains a lot. I know >> it totally does. Yeah. Um but uh it made me think of uh my time at Yahoo. So, um, when I joined Yahoo, um, folks have heard me tell a lot of stories about this, but it was going I joined the, um, my first day was the first round of layoffs in the company's history. Really interesting time. I think I've talked about in the past. I'm sure I'll talk about it more in the future, but uh, the company had had like like the the euphoria bubble had just burst. like people realize this was right when the world realized that oh there might be this.com bubble is not going to just grow forever and uh that first day I joined um was a company all hands and and the two founders Jerry Yang and and David Pho had gotten on stage and they were actually crying saying hey we're going to have to let some of you go and Tim Kougall who was the initial CEO of Yahoo um basically announced that the board had asked him to step down so he was replaced a few weeks after I joined by a gentleman named Terry Seml who had been the head of Warner Brothers before then and he was a guy that grew up through the the media industry kind of one of these you know sort of start of the mail room stories I believed and then you know actually ended up running the company um and he was a huge media mogul I mean just huge um and this was big news because it was sort of the marriage of Hollywood and the internet and Um, uh, anyways, uh, Terry I think did do a a good job of sort of restructuring Yahoo. I think it had something like a couple dozen business units when he joined and he collapsed to six and he began running the company a lot more formally. uh the whole Hollywood marriage with the internet didn't really work out the way that he envisioned and a lot of people uh at the company had um a lot of issue with how much Terry took out of the company in equity. Uh that's a side separate story though. The key thing I want to note is um Terry was I think one of the most successful guys in corporate America at the time and uh seemed like a really nice guy just at least to the people at the company. I I I worked in the same building as him. In fact, I worked I moved floors a couple of times, but I was usually a floor above or a floor below him. So, I would bump into him a lot. Um, you know, was always kind to employees and whatnot. Uh, and, uh, most days I'd see him walk out and he had a driver that would, you know, take him to the airport and he'd fly back down to LA and be with his family. Um, anyways, where I'm going with all this is, you know, he when he left the company, I I don't know how many probably billions he had taken out of Yahoo. Uh, he had already been a billionaire, I think, uh, to start, but anyways, super wealthy. Um, again, just just a huge power player in the media space. Um, and then I hadn't really heard much about him. And I don't know, it was probably like five or 10 years ago, Lance, I just Googled him to see what was going on. and super sad story. Came down with I don't know whether there's official Alzheimer's or dementia. Um but uh you know basically I I think pretty much you know became non-functional. Um, I don't know if he's still alive or not, but a lot of the most recent articles I could find was that he was basically living in a in a memory care center in a small little room and there was a huge, you know, dispute with his family going about, you know, uh, who was caring for him. It seemed pretty clear that he was not getting super great care and it seemed like his family was spending most of the time just squabbbling over his vast fortune. Um, but the point was this was a guy who literally had it all and and and lost it all not because of a poor business decision or whatever. It's just because he lost his mind due to, you know, the the mental decay of age. Um, and so to me it was a real vote for what you're doing, Lance, which is, you know, we all as we age should be finding ways to to prevent having that kind of outcome. Um, but I think even more importantly, just perspective-wise, right, it's it's to make the most of the moment, right? Because we just don't know how much time we have left. I mean, even just with our lifespans, but we may actually lose ourselves potentially long before we actually lose our lives. And so hopefully that doesn't happen. But, uh, we can't control the future completely. Uh, but what we can control is how much we make out of the present. And I really took your example, Lance, as a as a sort of a double barrel um uh inspiration to a, you know, continue to lean into the things that are hopefully going to keep me mentally sharp going forward. Uh but also just to spend a little bit more time, you know, because I'm one of those guys who just kind of keeps the nose to the grindstone and I'm always working for the future. >> It's a good reminder to say, you know what, just just create a little bit more space for today because you just don't know how much of the future you're going to have. No, that's that's a that's why my wife and I, you know, with my my wife's diagnosis as well, just really I used to be just like you, which this is just until last year, I was just like you, right? It's just nose and grindstoneone, 18 hour days, those type of things, just constantly grinding on the business. And when my wife came down with her diagnosis, it's like, okay, well, why am I doing all this? I'm doing all this so that I can enjoy my time with her, and I'm not doing that. So, you know, it's just it just it things like that just put things in perspective really quick about what's important and what's not. >> Yeah. All right. Well, okay. So, folks, hopefully you take a little bit of of um uh direction from this again just to maybe ask yourselves, especially if you're at risk like somebody like like you know, in Lanca's situation, what are things you can be doing today to to hopefully decrease your vulnerability to to losing your mental acuity? Um but again, you know, for for everybody watching, um I think we can all have reminders about just living a little bit more in today. Um making sure that we we we keep some capacity in our lives to, >> you know, what is it? You know, >> suck the marrow of of of the day that we have our carpadium, right? Um >> correct. >> Versus just living in tomorrow. And then in quick wrapping up here, um I I mentioned that I I I joined officially joined Lance last week in the um hangry club, although I'm really not that angry at Lance. Um and that's what I want to talk about. Um so uh you know uh I've I think I've shared when I've done some fasts on this channel and and I think I've said when I did them, I wasn't doing it primarily for for weight loss. I was doing it for the autophagy and and the the the cellular benefits that come along with it. Um I am uh total vanity goal, you know, trying to trim down uh for uh an end of July goal here. Um and I've got a trainer and you know, basically been working with the trainer for a while. We've been building strength the past couple uh or the past year. Uh and I said, "Okay, look, you know, now it's time for this vanity goal." So, he's come up with a whole, you know, um, fitness program for me, but he said substantially more important than the fitness program is the nutrition side of things. And, um, I went and got, have you ever done a DEXA scan, Lance? >> Yes. >> Okay. So, he's got a DEXA scan. I went and got DEXA scans. And folks, that's is basically just sort of like a fancy body scan that measures your your body composition, your your muscle weight, your percent fat, all that type of stuff. and he looked at the results and he said, "Okay, look, I'm going to put together a nutrition plan for you, Adam, based upon these results." So, he um you know, ended up um building a a macrobalanced um nutrition plan. And for the folks that don't really understand that, it's just okay, how much what's the right percent protein, um fat, and carbohydrates that you should be taking in during the day. Um and he put together a meal plan, you know, four meals a day for me on this. And um so I've been following it since. And so, first off, and I think Lance, you and I were talking about this before we turn the uh the camera on, you know, when you're eating healthy foods, they tend to to be less calorie dense than a lot of the processed foods that most Americans eat. So, there's actually a lot of volume. So, eating these four meals a day, like there's a lot of food on the plate in each of these meals. And I'm a guy who loves to eat. I love food. Even I am kind of getting to the point by midday where I'm just like, "Oh my god, do I have to keep trying to cram this stuff in? This is a lot of food." Um, but uh it is it's all healthy food and again it's all um constructed to to balance my macros. Uh so even in just this first week uh I'm down about four and a half pounds. I've lost a percentage point of body weight. Um hopefully I can keep the momentum going forward from here. One of the things I just want to let folks know is you can eat healthy and you you can eat to lose weight even um but not feel like you're starving yourself. As a matter of fact, I feel like I'm stuffing myself so far through this program. Um and uh uh for folks that are um uh unaware of why you should balance your macros, just real quick, they say it's essential for optimizing energy levels, managing weight, and ensuring proper bodily function. It goes beyond just calorie counting, helping to manage blood sugar, prevent muscle loss, improve workout performance, and prevent nutrient deficiencies, right? So, why wouldn't you want to do this? So, anyways, I'm one of those guys, Lance. I don't know about you, I'm terrible at um uh like I I'm terrible at thinking about if doing meal prep and thinking about stuff. If I have to think about it, it becomes too complicated and I usually end up just making a bad choice, right? So, the key thing here is to try to arrange your meals in advance. I'm very fortunate to have a wife here who's helping me with a lot of this so that when it's time for the meal, I just go and grab it. Um, but what's been really useful for this, and this is the hack that I I mentioned at the beginning here, um, if you're thinking about doing something like this, if you can get your your um, macros designed for you, in other words, you know, how many what percent protein, carbs, um, and uh, fat you should have for a meal. If you're like me, that doesn't really mean much to you, right, Lance? If you tell me I need a a meal that has 50% protein, 30% carbs, and 20% fat, okay, I get it, but like I I can't really visualize that easily in my head. So, what you do is you just put this into AI like Claude or Chat GPD and say, "Look, I need meals with these macros." And what it'll do is it'll spit out a whole bunch of recipes that are designed for the macros that you need. And you can do things like, "Hey, these are the ingredients I have in the refrigerator." It says, "Great. Okay, I'll build you a macro balanced meal from the ingredients that you have at home." It's like a total gamecher. It makes it so much easier for an idiot like me to do this. So, anyways, I wanted to share all that with everybody. I'm sure you've got some thoughts with that, Lance. >> No, no, no, no. I do the same thing. Um, basically you tell it what kind of, you know, this is my goal. It'll tell you what you need to eat. And then take it one step further. Have it create your grocery list. Say, "This is my budget. I've got $300 to spend on groceries for the week or whatever your number is. Build me a grocery list so I can cook those meals within this budget and it'll create an entire tell you exactly what you need to go buy at the store." >> Yeah. And I'll tell you, this is the business I would love to see out there. And I think this is going to happen sometime relatively soon where I can send that list of macros and, you know, ingredients or whatever. Or I like to eat these things, right? Build build meals that have these things as the key ingredients. Um, and just send it to either a business or to a a Whole Foods or an existing grocery store and just have them do the meal prep, right? And so send me preackaged meals that are designed for me specifically. >> Adam, we are on this show to teach people how to live better, but also save money. And that means you need to learn to cook for yourself because it's cheaper than going to Whole Foods and having them prep it for you and deliver it to your house. So, >> I I completely agree with you, and this is a shortcoming on my part in and a big part of this is me still living nose to the grindstone, but Lance, with all the eating and working out and video editing I do, I feel like that's all I do these days is I'm like, I'm filming this with you. I then got to edit it, but somewhere in there, I got to scarf down these four meals and then I've got to get the two workouts of the day in. Like, there's no time left for anything else. >> Trust me, brother. I'm I'm right there with you. >> Yeah. And it's funny that you're saying that because my wife's actually gone for the next couple days. So, no, I am doing a lot of the meal prep right now. And it it is not nearly as bad as as I'm making it out to be. So, you're right, Lance. I just need to to man up and and and >> yeah, there you go. >> You know, do primary cooking a bit more. All right. And last thing I'll just say on this, folks, is um this DEXA scan thing I mentioned, it's pretty cool, but um a lot of people don't have access to it, and it's not the cheapest thing in the world either. Um, but having the the data to not just track your progress, but to also be able to do things like build a, you know, have an experienced person build a a customized nutrition program for you off of. Um, there's a lot of pretty easy ways to get that now. And they have these cool biometric scales out there. Um, the one that I use, um, this isn't paid or anything. I'm just sharing with it. It's a company called Renfo, Reen Po, I believe. And I got my scale off of, um, Amazon. It's like 25 bucks. It's It's really not that expensive at all. And what's funny is is you get a lot more data off the DEXA scan, but on key things like percent body fat, which is really the the metric I'm trying to to bring down here, it was pretty spot-on. So, you know, this 25 buck scale from Amazon was doing pretty giving pretty much the same results as this super fancy, you know, entire medical bay body scan, Dexus scan thing. stuff. Anyways, folks, if you're looking if you're looking for a little bit of help um in, you know, helping you achieve some of your goals this summer, um if you don't already have a biometric scale, that's something you might want to look into. >> Yeah. And plus, just remember that the best scale is the mirror. It really doesn't matter what you weigh because muscle weighs more than fat. So, don't worry so much about your weight. Worry more about how you look. And, you know, combine your dieting with some weight training and some aerobic exercise. And the whole goal is just to be healthy and look great without any clothes on. So that's the whole point. >> Totally agree. And like I said, you know, this this goal I have here is aesthetic for the summer. Um and I agree with you. At the end of the day, you're doing it to look good. So you want to look in the mirror and say, "Look, am I looking the way that I want to look?" I do realize that sometimes, you know, you can kind of get used to what you see in the mirror, right? And what I like about the the numbers of the scale is it just doesn't lie, right? >> Yeah. Well, that is until I until I hack into your scale and adjust. >> That That is very true. Well, the and the problem we have here and Lance, you were ranting the other day how hard it is to get abs as you get older as a well, probably as anybody, but as a man >> and it's totally true. And um for somebody who carries their weight around their middle, which is what I do, I mean, I I I literally the last thing to go on me is just that belt right around the hips. Um, I call it I call it the draining the pond problem, which is if if if a pond is 100% full or two% full, it's still just flat on the surface, right? You don't see the contours of the bottom until you've actually drained those last couple percentages. So, you're just working your ass off to lose weight. And you are, but you're still looking at your abs and you're like, where are they? Right. And the problem is you don't see them until right at the very end. >> Exactly. They're the LA they're they're always late to the party. So, >> all right, my friend. Well, look, um, great week as always. Like I said, um, folks, if uh, if you think the best way to invest for your future is to continue to watch Lance Roberts on this program week in and week out. Let them know that by hitting the like button and then clicking on the subscribe button below as well as that little bell icon right next to it. Um, as a reminder, I think we we we just passed 175,000 subs. I think we just passed 106,000 subs. Um, we're trying to get to 200,000 subs as fast as we can. Um, hopefully by my midsummer weight goal, if not before. Um, because that's going to give this channel extra oomph from the YouTube algo. So, again, if you're watching and you haven't subscribed yet, please do take just a quick second to do that. >> It's free. >> Just subscribe. >> It's free. Subscribe. >> Yeah, totally. >> To the channel. Just subscribe. >> No, no commitments. And the benefit you get is especially when you click that little bell is when we have a new video comes out, it just sends you a little ping to say, "Hey, there's a new video out. Come watch it." Um, and uh, if you would like to get some help in addition to making yourself more physically fit this summer, if you'd like to get some help being more financially fit, consider talking to one of the financial adviserss, thoughtful money endorses, perhaps you'd like to talk to Lance himself and the team there at RAA. To do that, just fill out the very short form at thoughtfulmoney.com and the advisors will be in touch with you right away. All right, that's it, Lance. As usual, you get the last word. >> That's it. Y'all have a great week. See you all back here next Friday. >> All right, take care, buddy. Everybody else, thanks so much for watching.