00:00 Are any stocks pricing any of this in because I look at like the IWM sitting near three-year lows.
00:05 I mean, it looks to me like some stocks are pricing in a recession here.
00:08 And again, we know when we look at the mega cap tech, you know, Microsoft and Magnificent 7 have held the market up very well here.
00:16 But it's kind of like the tale of two markets here.
00:18 Do you think eventually some of, you know, the small caps that price this in and maybe they can turn it around?
00:23 Or is it more like the Magnificent 7 could maybe start to get hit?
00:27 I think that the bulk of the market hasn't fully priced in what we're going to see down the road economically.
00:32 I said way back in May, frankly, that you probably have a decline in inflation through the summer.
00:38 You get it to 3 percent and this causes a party.
00:40 Maybe the stock market even goes to new highs, which it didn't, which is a sign unto itself of its inherent weakness.
00:46 This is the most narrow rally, you know, in through June, July.
00:49 Then energy started to creep into the picture.
00:52 All right. I think something significant has happened in the last week alone where we do a quantitative portfolio for our institutional clients.
00:59 And it's a playbook. We've got the portfolio playbook that we offer to individuals as well.
01:04 And just even as recently as a week ago, you know, we were looking at, you know, being an energy 33 percent financial 17, industrials 15, Infotech 22.
01:14 You know, right now we're in, you know, basically energy half communications, which has been really hot to about 40 percent.
01:23 And the rest is gold and Bitcoin.
01:24 So when you look at the quantitative side and then you look at the technical side where the S&P 500, it's really broken down.
01:32 I mean, it's closer to new highs than it is even a longer term breakdown pivot.
01:35 Same with the Nasdaq below 14, 600, which you took out briefly yesterday.
01:40 That's a major breakdown where you have scope technically, quantitatively, and I think even fundamentally, at least in terms of the macro monetary picture down to like, you know, 13000, if not 11000 in the Nasdaq.
01:52 So I look at, you know, the big tech has led the way.
01:56 It's only now rolling over and starting to crack the XLK just breaking down just now.
02:01 Some things are broken down, utilities, the real estate, certainly anything to do with the mortgage market has cracked.
02:07 Staples have cracked, which is interesting.
02:09 So now discretionary is following.
02:11 Healthcare is following.
02:12 Industrials are following.
02:13 All the sectors are now rolling over, breaking down, threatening long term moving averages.
02:18 And in a lot of cases, the uptrend goes all the way back to the pandemic low, if not in some cases like utilities and Staples going back to the 2009 low.
02:26 So I think this is a much bigger picture dynamic that we have coming at us.
02:30 So, you know, in the short term to medium term for me, this is still about protection.
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