Why Las Vegas Wants Semiconductors More Than Slots

April 6, 2026 | Season 8 | Episode 10

Oil is hovering near $110, ceasefire rumors are colliding with strike reports, and markets are trying to price the unpriceable in real time. We sit down to sort signal from noise and connect geopolitics in the Middle East to the practical question every investor is asking: what changes next for inflation, interest rates, and portfolio risk?

We walk through two big strategic lessons that nations tend to learn during conflict. The first is the uncomfortable incentive created around nuclear capability and deterrence. The second is the push for self-reliance: energy independence, control of rare earth minerals, and reshoring critical manufacturing like semiconductors and chip technology. Those themes are not abstract policy debates, they show up in sectors, supply chains, and long-term capital spending that can reshape markets for years.

Then we zoom in on the data investors trade on: a stronger-than-expected U.S. jobs report, cooling wage growth, and the ongoing reality that healthcare hiring is a core engine of the economy. From there, we dig into stock valuation the way professionals do, including why price-to-earnings can look calmer while free cash flow tells a different story when AI and data center capex surges. We also explore consumer “wealth effect” risk, federal deficit spending as a tailwind that may not last forever, and why even a place like Las Vegas is trying to reinvent itself from casino floors to tech, logistics, and healthcare.

If you care about investing, market volatility, geopolitical risk, energy security, and how to think several steps ahead, this conversation is built for you. Subscribe, share with a friend who follows markets closely, and leave a review with the one theme you think will matter most over the next year.

** For informational and educational purposes only, not intended as investment advice. Views and opinions are subject to change without notice. 

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Transcript

Welcome And Market Setup

Alan Eppers 0:00

And now introducing Mr. Keith Lanton.

Nuclear Lessons From Modern Conflicts

Energy Independence And Supply Chain Risk

China’s Long Game On Energy

WWII POW History And Today’s Rescue

Jobs Report Surprise And Healthcare Hiring

Ceasefire Headlines And Week Ahead

Stock Valuation Beyond P/E Ratios

Wealth Effect And Federal Spending Risks

Las Vegas Pivot From Gambling To Tech

Where To Listen And Disclosures

Keith Lanton 0:03

Good morning. Today is Monday, April 6th. Today is uh first uh discussion in the uh second quarter of uh 2026. Hope everyone had a fantastic Easter Sunday and those uh celebrating uh Passover. I hope uh that uh those uh celebrations were joyous as well. Financial markets uh largely closed on Friday. The bond market was open in the morning. The uh employment report came out on Friday, so bond market uh was open to digest that report. We'll talk about that report. It came in a little bit stronger than expected, caused uh interest rates to nudge up on Friday in a very quiet uh bond trading session, but uh we'll be digesting that information further this morning. Here we are, Monday morning. Conflict uh in the Middle East uh continues. We are very grateful for the successful rescue operation for U.S. airmen that uh had been behind the enemy lines uh for almost two days and the successful operation to extricate him. And we'll uh we'll talk a little bit about that that operation in a uh historical context. This morning we are going to once again seek where things are going so that we can make better investing decisions, and we will uh do that within the context of some of the ramifications of the conflict in the Middle East and what that may mean longer term, as well as looking back as we often do in history and hopefully uh being able to use a historical reference to make better investing decisions, to recognize that many things that we are seeing for the first time are not necessarily the first time that our society or humanity has experienced what we are currently experiencing. So very often there are lots of uh lessons in the past that we are unaware of. And those of us who can harness that power, who can harness that knowledge, can make more intelligent decisions, both personally, and uh here we're talking about investing. If you've got that knowledge and you go back and you study what has happened and you see what the effects were, uh very often you can make better decisions in terms of creating a portfolio, seeing where things are going, and make intelligent decisions going forward. That's hopefully the lesson here. So great athletes, like great chess players and great investors, recognize that to be the best, they need to be thinking several steps ahead. And as we've discussed in the past, the long-term implications of the US-Iran conflict uh as well as Israel, key player here, as well as uh other participants, US and Israeli allies, as strange as that word may sound, with Israel like Saudi Arabia, UAE, Qatar, as well as as well as countries like Kuwait, Bahrain. Well, all of this will be analyzed for years to come. And as I've alluded to in the past, I think that there are two major key lessons that world leaders, future world leaders, and generations to come will apply as a lesson from uh what has taken place here in the Middle East. And one is that uh obtaining a nuclear weapon is possibly a path to not having military action taken unilaterally against your country. And therefore, I think it is uh very likely that we will see a desire on part of many countries to enhance or to obtain nuclear technology. Again, it is not a new technology, it's an 80-year-old technology, it requires some sophisticated equipment in order to enrich uranium. But again, we are not talking about something that has been recently uh discovered. There's lots of knowledge out there, even lots of knowledge on the internet, and I think it's very likely we will continue to see more and more countries, perhaps even rogue states, uh, seek out the nuclear capabilities. The lesson from the past is uh countries like Ukraine, that at the after the fall of uh the Soviet Union, they had nuclear weapons on their soil. They had returned those nuclear weapons with some assurances as we've discussed, and today many have suggesting that perhaps if they had that nuclear weapons uh still on their soil, that the situation between Russia and Ukraine may be different today. Uh Libya also had nuclear technology, had returned it, and had seen an invasion of their country, and then of course Iran, which has been seeking nuclear capabilities, and the rest of the world having uh been very uh much uh opposed to that for obvious reasons, but nevertheless, the Iranian lesson here may be that perhaps the outcome in the Middle East or the effects of uh what's taking place might have been different if they had nuclear capabilities, obviously very much in the minds of us, grateful that they don't, but that doesn't mean they will not continue to pursue it, as uh President Trump is acutely aware. And of course, the fact that North Korea, who is uh very much considered a pariah state, yet a country that is largely left to its own devices, uh perhaps because of their not only nuclear but their uh missile uh capabilities, and other countries uh certainly keeping an eye on how they are treated relative to some of the other countries that don't have nuclear technology. So something to certainly be mindful of. The other main takeaway from what's taken place here in the Middle East is do not rely on any other nation for your critical needs. Now it could be argued that the United States learned a important lesson in the early 1970s when the U.S. had an oil crisis where OPEC boycotted the United States and therefore significantly increased the price of U.S. oil at a time when the U.S. was not producing as much oil as they are today, as we've discussed before. And uh one of the main reasons perhaps the U.S. learned new technologies, necessity being the mother of invention, is because of the lessons of the 1970s in that we do not want to be dependent on any other countries for our critical needs. And we made a decision, and the U.S. has embarked on a campaign to be energy independent. President Trump certainly uh at the spear point uh of seeking independence for oil and gas and fossil fuels here in the United States. We are blessed with uh an abundance of uh certainly uh coal and gas and uh through technological innovation we have uh learned how to frack uh oil and gas as well, and therefore uh we are less reliant on the rest of the world, and the rest of the world is now saying, hey, we need to be less reliant on the Middle East also. So these countries, especially China, and we'll talk about China because there was an article on this very topic in the New York Times this morning, we'll uh allude to that and discuss that. But these countries are having their OPEC moment today, and their mindset is either have and obtain fossil fuels, or number two, seek out alternative energy, sun, wind, hydropower. Seek out alternatives. Do not be reliant on others for your critical needs. And the U.S. is certainly taking this to heart as well. We've seen uh the United States uh being very susceptible to the need for rare earth minerals, the Chinese uh being keenly aware of this and uh having threatened uh the supply of rare earth minerals, and uh the U.S. and the Trump administration seeking out uh to find alternative means, just as the Chinese, the Indians, the Japanese, much of the rest of the world seeking out uh other ways of uh obtaining energy. The U.S. is seeking out other ways of obtaining rare earth minerals. We are also seeking to onshore lots of uh manufacturing that we've uh previously uh offshored, as we are concerned about uh not being able to produce enough goods and services in the event of an emergency. This is particularly a focus uh when it comes to semiconductors and chip technology. So as uh the great hockey player Wayne Gretzky said when discussing being a successful hockey player, and the key to being such a tremendous success is to focus on where the puck is going. So if you want to succeed in investing, you need to focus on what is next. Most investors have a very good understanding of the present. So if you've got a good understanding of the present, that is basic table stakes. If you don't have that, you're gonna certainly ha suffer as an investor, but you will probably not excel as an investor. Successful investors are looking many steps ahead, and this is why being a successful investor is so difficult, so challenging. It requires this data gathering of data and the foresight and the intelligence to be able to make sense of the data, not just gather it, but to analyze it and to have a real thesis on what is going to come next. Wall Street investors, successful investors, when you look at individual stocks and you say, hey, that company is uh trading at such a high multiple, why is that? Well, many times the case that it's trading at a high multiple is because someone sees something in the future that they that is not being recognized in the present earnings, but they see the future as being bright because they are looking several steps forward. And the key is to distinguish between the companies that are trading at multiples higher because you see that future being bright, and other companies that are being traded at multiples higher because uh some investors are seeing a bright future, and that bright future may not materialize, and to distinguish between the two, that is where the gold is made, that is where the challenges, that is where the analysis hits the road, that is what distinguishes great investors from average or mediocre investors or poor investors, and that is why investing is so challenging. Let's take a look at this New York Times article from this morning that uh this is not China's war, but Beijing started preparing for it years ago. The Chinese looking forward as we just discussed, and the future is now. They were long concerned about geopolitical crises, and in President Trump's first term, when they saw signs of the world uh order looking differently, the Chinese redoubled their efforts to secure energy security. The energy shock caused by the war in the Middle East caught China, the world's top buyer of oil by surprise, but Beijing has been preparing for a crisis like this for years. China has stockpiled large amounts of oil, it has pursued renewable sources of energy like solar, wind, and hydropower, as we just talked about aggressively, that its demand for oil, diesel, and gasoline is falling. And it has harnessed technology to reduce its reliance on foreign sourced raw materials that go into the massive output of its factories. China has doubled down on policies to build up its local industries and to be a global dominant source of resources in order to be able to continue to drive and keep fed their supply chains. You go back just ten years ago, China was the world's biggest market for internal combustion engine cars that are cars that run on gasoline. Today, China is the top maker of electrical vehicles. China used to be the largest buyer of foreign source petrochemicals. Those are the raw materials derived from oil that are used to make plastic, metal, rubber components, and other key ingredients that go into the factories that China turns out. Today, China is mostly using domestic coal to make certain chemicals like methanol and synthetic ammonia. Government planning and investment were keys to these advances. So Chinese were looking where things were going, they didn't want to be dependent, and they pivoted. As the Strait of Hormuz, the passageway from which virtually all the oil that flows to China and the Asia today remains largely shut. China has proven to be more resilient than many of their Asian neighbors. China can now power many of its cars and trains with electricity, greatly reducing its reliance on oil. China has honed the use of coal to produce its petrochemicals using a technology developed by Germany during World War II, which converts coal into petrochemicals and into oil. This is something that South Africa does as well. Now China is still the largest buyer of oil and gas, and three-quarters of its oil is imported, but they are dramatically reducing their reliance on imported oil and gas, and they are now using less oil and gas than they did just a few years ago, and they are starting to harness increasing amounts of alternative energy, wind, sun, hydro, and becoming world leaders in this technology, electric vehicles, as they have sought out a plan because they were looking where things are going, and they're looking to see where the world is moving, and they have implemented that plan here today, and we can see this is an example of seeing where things may be headed, not wanting to be reliant on others going forward. And this is what the model here is in China, and this is the model that the United States is employing today in the policies that we're seeing from the current administration with respect to rare earth minerals and with respect to semiconductors, and we can expect to see the rest of the world do that. And then the thought process becomes what does that mean for my investments? How does this change things going forward? How does this matter three months, six months, one year, two years, five years, ten years from now? These are the difficult, challenging questions that we don't have the answers to, but that the brightest minds are working on in order to assess where things will be going forward and where the next great investments will be. So let's think, let's look back a little bit, let's think in a historical context. Over the weekend, we are very grateful for the successful rescue of a U.S. airman from Iranian soil. If captured, he might have been a prisoner of war or worse, a hostage. This was one of the main reasons that we were so worried about this airman, and we are so grateful that uh he's back on U.S. not soil, but uh within the U.S. military's capable hands. But history also provides us with valuable lessons, not just in a historical context, uh, but when it comes to, as we mentioned, life lessons and investing, and many of us believe oftentimes that we are living in unprecedented times. No one's ever gone through anything like this. No, no generation has ever experienced what we are experiencing. After all, we've got such tremendous technology that didn't exist before. How could anyone have ever experienced anything like this before? But humans are human, and we evolve very slowly. So very likely what we are experiencing today, certainly with respect to emotions, but to the decisions that human may have have humans make, has probably, not always, but probably happened before. So therefore, many of us think there is no roadmap going forward. This may be the case, but most of the time, almost always, it is not the case, because there oftentimes is a roadmap. It's just often that we forget history. We don't remember it, we don't study it, we aren't aware of it uh aware of it. So when we think about this airman that was so fortunately rescued, we can think about prisoners of war in historical times, and uh we can think back, and this is uh for just historical context, if you think back to as recently as about eighty years ago, World War II, and uh you think back to uh what you learned in school, how many of you learned during World War II that the US, when when we were seeking victory over the Nazis, that we had German POWs? Probably not that surprising. We were at war with Germany off, you know, of course, and during the course of war, some Germans would be captured and some would surrender. But are you aware, did you learn in school how many German POWs that there were on U.S. soil? You might think to yourself, well, you know, probably a few of them might have been transported around across the Atlantic. You might remember hearing something about that in your prior life in school. You might, you might not. Uh you might think to yourself, you know what, maybe it's a few thousand Germans that were here on U.S. soil in World War II. But in fact, by the end of World War II, there were about four hundred thousand, four hundred thousand German POWs held on U.S. soil. At the height of the program, there were five to six hundred base camps and branch camps spread across nearly every single state within the United States. And because of domestic labor shortages caused by the war, many POWs were actually put to work in agriculture, harvesting crops, canning factories, working in logging. And in fact, in night by 1944, they were a vital part of the American agricultural economy. Now at the end of the war, most of the uh Germans were, as per the Geneva Convention, returned to Germany. But because these prisoners of war were treated well, they're actually uh you may be thinking to yourself that uh sounds very dangerous to have uh all of these Germans here in the United States in close proximity to U.S. towns and villages, and there were actually lots of fears uh with respect to that that locals uh did have, and it was in the media in the uh in the 1940s, but there was actually uh relatively few number of escapes and very few uh incidents. In fact, many of the uh Germans that were held here said the conditions were so good, many of them uh were processed and sought to come back to the U.S. uh on immigration visas after uh be being uh s returned uh to Germany. In fact, they had worked so successfully on many of the farms that uh many former POWs had ready-made sponsors. Farmers in the Midwest and South wrote letters to the government to help their former prisoners return as legal immigrant laborers. So something that you may not have known, something that uh certainly had historical impact, certainly that uh something that contributed to uh immigration here into uh the United States after World War II, and all of this taking place as a uh effect of World War II, and something that uh you may not have thought took place in the past, you may not have thought that we've ever brought back uh in mass uh a massive amount of uh prisoners of war here into the United States. And uh if you even if you did know that, you may not have known what that program looked like and what the ramifications and implications and future of that program became. So uh something you can can think about when you think about when you're experiencing things for the first time. So let's talk about something else that's happened over and over again, something that was released on Friday, and that is the employment report from the Bureau of Labor Statistics. That showed a stronger increase in jobs than had been anticipated. We saw 178,000 non-farm jobs added uh to payrolls, and the unemployment rate actually dropped to 4.3%. The gains of 178,000 exceeded expectations of 59,000. But that was somewhat uh tempered by the fact that the previous month, February, saw a revision downward in the number of uh jobs created. So the net effect still was uh more jobs created between February and March than expected, but not quite as many as the headline number, but nevertheless better than expected. Also uh unemployment rate better than expected, although the reason that the unemployment rate fell, which was surprising, was due to a decrease in the labor force, so less people uh seeking jobs, perhaps an effect of immigration, although some economists are not sure that that is the primary driver. So a little bit of an enigma there, but unemployment rate is at 4.3%. Also of note is that the sector that continues to drive new jobs, and we'll talk about this a little bit more in depth, is healthcare. Healthcare gained over 70,000 jobs in in the month of March, and healthcare and the aging population continue to drive the U.S. economy. One note that uh workers are, at least as of at least the last month, earning a little bit less in terms of increased wages. Average hourly earnings rose only two-tenths of one percent. That was the slowest pace since May of 2021, kind of reinforcing the thesis that uh despite the fact that the job market uh is holding up, that workers do not seem to be in the driver's seat in terms of uh being able to uh get higher wages, that it is a no-hire or slow hire, I guess uh would be the right phrase, but slow hire, no fire type of economy at the moment. This morning we are seeing futures uh trading slightly to the upside. We see uh SP futures are up around 13 points, Nasdaq futures up about 120 points, uh, Dow futures are down slightly. Last week's uh markets uh were up strongly across the board. The rally was supported by optimism that a ceasefire could be reached between the U.S. and Iran, as well as commentary from Fed Chair Powell, who noted inflation expectations remain well anchored past the near term, the near term meaning what we're experiencing here with energy prices. Developments on the geopolitical and energy fronts continue to drive headlines this morning. Axios is reporting that the U.S. and Iran and mediators are discussing a 45-day ceasefire agreement that could lead to the end of the war, though many sources are saying that the chances of striking a deal still seem distant. Uh President Trump saying that if a deal is not reached by Tuesday's deadline, that Iran will face a new wave of attacks against the infrastructure sites. In fact, a report this morning that Israel had uh had struck a One of uh Iran's uh key energy infrastructure uh sites uh this morning. Their largest uh petrochemical site, crude oil, is down just modestly, although it's bouncing around, so but it's still trading around $110 a barrel. Reports that Iran is rejecting the opening of the Straits of Hormuz as part of any ceasefire deal, but somewhat encouraging this morning are reports that uh traffic is at its highest level in weeks in the Strait of Hormuz, that according to Bloomberg on reports that uh more countries uh are getting are getting uh waivers from Iran to be able to be able to transport oil out of the Middle East. Axios reporter just a few minutes ago saying at a White House official told him the plan for a 40-day ceasefire between the U.S. and Iran is one of many ideas being discussed at the moment. The president has not signed off on it yet. Operation Epic Fury continues. President Trump will speak more at 1 p.m. where he is holding a press conference. Companies in the news this morning, Netflix upgraded this morning at the Goldman Sachs, Tesla stock up slightly this morning. So it's March South Korea sales increased by 300%. Again, this may be one of those secondary effects that we're talking about with respect to the crisis in the Middle East, that uh electric vehicle sales uh may uh be sustainably higher, and that may perpetuate the more than just through hopefully uh the hopeful near cessation of hostilities. Taking a look overseas, uh Asia Pacific region began the week on a mixed note while markets in China, Hong Kong, Australia, and New Zealand were closed. Japan's markets up uh slightly, India up over 1%, South Korea up about 1% as well. Also, again, talking about some of the themes we discussed earlier, Japan's Prime Minister Takeichi will travel to Australia to secure Japan's rare earth supply chain and discuss cooperation. In the energy space, I mentioned oil down slightly about a dollar a barrel. We are seeing gold up this morning, just under 1%, silver up about half of a percent, and copper moving higher this morning. Politico reporting that President Trump is considering removing Commerce Secretary Howard Lutnick and Labor Secretary Lori Chavez de Remer. Those uh reports uh following the ouster of Pam Bondi as Attorney General. Also, you may have seen the headlines uh over the uh weekend that the White House is seeking a $1.5 trillion defense budget, which is a 44% increase in the military budget from current levels. That would be a uh historic increase in this historic high during uh, I guess uh we'd call this uh peacetime. Uh coming up this week, today at 10 o'clock, Institute for Supply Management has its services purchasing managers index March coming out. We're looking for that to come in at 54.9. Wednesday, the Federal Open Market Committee releasing uh minutes for its mid-March monetary policy meeting, expected to keep the Fed funds rate unchanged at 3.5 to 3.3 quarter percent. Thursday, we get the PCE, widely watched uh indicator from the Federal Reserve for inflation. Economists expecting a 2.8% year-over-year increase matching January. Core PCE expected to come in at 3%, one-tenth of a percent less than last month. And Friday, we get the consumer price index for March. Looking for that to jump up to 3.4% year over year. That would be a full point more than February. Some inflationary figures. Many of you who are getting that uh cup of coffee this morning, the average U.S. retail price for a pound of roast coffee is up to $9.46. That is up 120% from just before COVID in January of 20. So 120% increase in the last uh roughly six years for a price cup of coffee, or at least the uh pound of roast coffee that goes into your coffee. Also, uh we are seeing a uh rise in aluminum prices, a four-year high after uh some uh smelters were hit uh in the Gulf uh by Iran. Moving on to uh financial markets and uh talking about uh Barons and uh where things may be going in the near term. Barons talking that uh the stock market uh is uh perhaps more expensive than it looks. This is not necessarily a negative commentary on the future of the markets, just that you should be careful and you should look at many different metrics of the markets when evaluating when to invest, how to invest. As uh we've been experiencing volatile times. Just take a company like NVIDIA. One day in the last uh two weeks it's up eight percent, next day it's down five percent, the next day it's down four percent, then it's up six percent. So these are the knee-jerk reactions we're seeing in financial markets, so these are certainly times to uh be mindful and cautious. We saw the S P 500 drop about 9% from its highs, then we saw a rally, and uh it's now down closer to 5 to 6%. So we are seeing lots of volatility, and as a result of that, we've seen markets come off, and we've seen the uh price-earnings ratio, which is the price of stocks divided by their current earnings. We've seen that ratio come down from about 23-24 to forward earnings down to about 20 times. So some would suggest, hey, things are getting uh more attractive, levels are getting more reasonable when uh measuring uh stocks uh relative to their earnings. But Barron says, hold on, wait a minute, you can't only look at PE ratios. They suggest uh that uh given the tremendous spending on artificial intelligence and data centers, that we also need to look at another key metric, and they say to consider also looking at free cash flow. Free cash flow is the amount of cash that's left after earnings and capital expenditures. So many of these companies in the Mag 7 are spending tremendously on CapEx as they build out their infrastructure for uh supporting artificial intelligence. And if you look at the price to free cash flow ratio, not the price to earnings, but price to free cash flow ratio, instead of that being a 20 like price to earnings, it's twenty-seven point four, which is thirty-seven percent above its twenty-year average. Earnings and free cash flows are traditionally two ways of measuring the same thing, the money companies make after expenses. The difference between them normally doesn't matter all that much. But because of this big AI spending, there's been a wide divergence. So the amount of earnings that companies are expected to earn this year is about $2.8 trillion, but they're only expected to generate about $1.9 trillion in free cash flow. And that has to do with the treatment of spending on big ticket items like data centers and equipment. Earnings accounting doesn't subtract capital expenditures when the money is actually spent. Because what companies do is they deduct it little by little over its projected useful life. So what you're doing is you are depreciating the expenditures that you are taking today in the expectation that you will generate future earnings against those uh cash flow investments. So the key question, of course, is will you be able to continue to generate earnings similar to the investments that you've made in the past? Will these investments bear the same sort of return on investment as the current investments? If your thesis is yes, then you would perhaps argue that uh earnings in the future will be a lot higher. And the fact that we are seeing price to cash flow, free cash flow ratios being elevated is not as concerning. But if you are concerned about whether or not companies can turn these investments into future earnings at the same rate as current earnings, then you need to be mindful that future earnings may not be as robust as current earnings. And when you're looking at free cash flow and the range of expectations and how fast things are changing, you could take a look at Amazon. Analysts just as recently as a year ago had expected Amazon to produce free cash flow in the range of $100 billion in 2026. But as a result of Amazon investing in these future technologies, Amazon, instead of generating $100 billion of free cash flow is now expected to be negative $11 billion when it comes to free cash flow. So we can see that things have changed quickly, and therefore your analysis of future earnings, where things are going, back to that again, has changed, and therefore you need to be mindful of whether or not you believe that the future will be brighter or less bright than where we are today. And again, this comes back to being able to recognize what's taking place today and being able to project it going forward. And if you want to do that successfully, you may want to look back at the historical events and make a decision on whether or not you think the current situation will be brighter or less bright than what we are seeing today. Another source to be concerned about if you're an investor thinking of moving forward has to do with one of the main beneficiaries of consumer spending has been the higher equity markets, and the higher equity markets have enabled individual investors who have investments in the market to have more discretionary income because their investments have appreciated so substantially. So over the last decade, if you had invested in the S P 500, you would have seen your investments increase by 273% over the past 10 years, which is terrific, tremendous. That's a return of 14%, but stocks have historically returned closer to 10%. So even if things were to return to the mean, not even mean revision, but just return to the mean, the future will be less bright. Wealthy investors may have less to spend. This is something to uh factor into your thinking if the wealth effect uh does not continue to run at the pace that it is currently running at. And then finally, one of the other reasons the economy has been good is something to come up with a thesis is whether or not you think it will continue, and that is the federal government who has been a big spender. We've all heard about uh the deficit, uh running deficits of six, seven percent of GDP here in the United States. Traditionally, we'd run deficits of two percent if we were to get some sort of fiscal discipline. This is not exactly a prediction of that, but something that may be uh self-imposed, then the government may not be able to spend quite as much relative to what it is bringing in, and that would be another source of uh potential uh concern for uh financial markets. So you need to keep all of these items on your radar, make decisions on whether or not you think uh what we're currently experiencing is sustainable, and then make a decision on whether or not you think now is the time to invest, or now is the time to be a little bit more cautious. Now, in a separate article within Barrens, they talked about uh the fact that oil prices have surged, and this has caused uh weakness, obviously, in uh many parts of uh the economy. And here in this uh column uh Barrens is suggesting that uh this has created some uh near-term opportunities. Perhaps uh it is time to resume some bargain hunting. One of the places they suggest taking a look is in the uh home builders, which is an area that has sold off uh significantly recently as interest rates uh have increased and home builders have been forced to uh offer concessions. So uh they are suggesting that uh young Americans uh who have been uh living in apartments and having struggling with uh the world of higher interest rates, uh, that uh they have become overly pessimistic about the uh prospects for uh home ownership, and perhaps uh these stocks have sold off more than is justified. Also, we've seen some uh weakness in artificial intelligence stocks. We've seen weakness in the Mag 7, certainly Microsoft, Meta have sold off uh significantly from their highs. Nvidia has also been treading water for the past six months. We have seen the uh Magnificent 7PE ratio come down to 21, pretty much in line with the S P 500. If you believe that these companies can continue to outpace uh the economy and grow faster than most of their competitors, well, this may be an opportunity to take a look at those uh companies as well. Perhaps the best indication of what the future looks like uh will be from looking at the recent past, and that is earnings this week we get from Delta and Constellation brands. Uh major U.S. banks go next, uh JP Morgan along with companies such as Johnson ⁇ Johnson, ASML, which are big semiconductor, chip manufacturer, Netflix, and Pepsi all coming out with earnings in the near term. Cover story of Barons talked about Las Vegas and uh talking about that Las Vegas is on a cold streak, uh seeing a lot less visitors than they previously did uh and this uh driving some weakness in stocks that cater to folks who visit Las Vegas. So for decades, Las Vegas was the house that always won, but now that neon sign that's uh calling many in the past to Las Vegas is flickering. Uh visitation took its sharpest dive in history last year, down over 7%. Factors like inflation, room rates that used to be uh really cheap to lure you in, they're uh up to an average of about $180, and perhaps one of the biggest factors is a trade war with Canada, as Canada and Canadians uh often viewed Las Vegas as a cheap desert getaway, and they have uh chosen to uh not uh come and visit us here in the United States as a result of the uh trade war between the U.S. and Canada. Now it's not just about the price Baron's suggesting in this article, it's also the product because if you want to gamble, well, you can do that uh from your phone. So you don't have to get on that airplane, why fly to the strip when you can bet from your couch? So what we're seeing is the mollification of big casinos and therefore uh less reason to visit. Also, as a result of uh perhaps uh this weakness, the casino is getting stingier. Many are putting three zeros on the roulette wheel to uh worsen your odds a little bit more. Blackjack payouts. You may have noticed if you're a blackjack player that if you get blackjack instead of paying three to two, many casinos are paying six to five, and uh many gamblers are saying, well, this is uh getting less and less attractive. Another reason for uh for me not to uh make that trip uh to the casino. But Baron's saying don't count Vegas out yet. It's uh changing its spots to avoid becoming uh the next Atlantic city. The region is betting on a Reno style transformation, and this is a shift from slot machines to semiconductors. We talked about that onshoring before, seeing where things are going, and logistics. Las Vegas is seeking to become the lithium loop and to lure tech startups and healthcare giants to the region. Las Vegas is seeing a significant amount of retirees, and they are looking to cater to those retirees. Also, we've got a new baseball stadium coming in, the Oakland A's now becoming Las Vegas Athletics, $2 billion stadium opening in the near term. Tech sector starting to bring more jobs, and uh the city is uh trying to prove that it is becoming more than just uh place to come and gamble and play slot machines. So the only in Vegas magic still exists, but the smart money is moving from the casino floor into the laboratory, and uh the jackpot may not be a royal flush anymore, but it might become a tech initial public uh offering. That's everything I've got.

Alan Eppers 37:53

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Sophie Cohen 38:11

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