Bull Market Wiser Guys - Does Big Tech Sleep with the Fishes?

The Money Runner" podcast, hosted by David Nelson, offers a no-nonsense approach to finance and investing. Shunning the complicated jargon of Wall Street, Nelson advocates for straightforward strategies. 

Throughout the episodes, he provides insights based on his extensive 25-year experience, tackling topics such as market timing, corporate finance dynamics, and economic indicators like the ISM PMI data. With a critical eye on both historical and current market trends, Nelson discusses the broader implications of the recent price weakness of Apple and Nvida's outside day in March.

00:00 I Hate Smart Money Wise Guys
01:06 Going against the grain
01:52 Peter Lynch's Wisdom
02:12 Market Timing Challenges
02:34 Apple Peak?
03:44 Energy Leads
04:04 GE Split up
04:27 ISM Data Double-Edged Sword
04:57 The Terminator
05:19 Fed Speak
06:08 Technical Damage
06:23 Nvidia Warning
06:46 Market Event
07:29 Closing

Disclosure: "At the time of this article I currently hold shares in some of the companies mentioned as part of investment portfolios in funds I manage for Belpointe. Additionally, I may discuss other securities that are under consideration for future investment; however, discussing these securities is not a recommendation to buy, sell, or hold. My mention of these securities reflects my personal opinion and analysis at this moment and may change without notice. Please remember that all investments involve risks, including the possible loss of principal."

Transcript

0:03

You talking to me? I've had it with smart money, guys. I don't want no PHD, MBA, CFA. Give me high school dropouts that understand the basics. If the stock's going up, you buy it. If it's going down, you sell it. I don't want no Fibonacci retracement. Something to EBITDA. What What is it? Some kind of kangaroo? It's simple. If it's going up, you buy it. If it's going down, you sell it. Welcome to the Money Runner. I'm David Nelson. Going against the grain. Looking to stay ahead of the curve is a noble effort. Some of the brightest minds on Wall Street make their fortune sidestepping market downturns, waiting for the stars to align, pulling the trigger only when the target is out in the open. Look, I applaud the effort, but like most things in life, timing matters. I've been doing this gig for a little over 25 years, and I can remember only one time the stars seemed to line up for an extended period of prosperity. March 2000. Didn't work out so well. Waiting for the perfect moment to get in for many is a prescription for failure. Far more money has been lost by investors in preparing for corrections or anticipating corrections than has been lost in the corrections themselves. The above quote is alleged to have come from the great Peter Lynch, former manager of Fidelity's flagship product, the Magellan Fund. If you are off by a few months on a timing call, you can say you're early. Anything more than that is just wrong. If if you have the skills to market time successfully, go for it. But if you don't recognize that and find something to buy your financial future depends on it. All right. Let's turn our attention to what happened last week. The good news is that the broader participation in the bull market is here. It's not just a handful of mega-cap growth stocks driving the tape anymore. In fact, some of the biggest companies on the planet are in the toilet, doing their best to send markets lower. Apple Apple's been a dog. Unless there's some secret project they're hiding, it looks like the Cupertino giant is missing out on the most important technology shift in a generation. If there’s a tech stock that sleeps with the fishes. This is it. Apple is starting to look a lot like IBM in the eighties. A clear market leader that lost their way, riding the wave of past innovation. Fractional sales growth, a missed product cycle, earnings per share growth largely dependent on share buybacks and important growth markets like China in secular decline will likely weigh on this stock for some time. Year to date, energy is the clear leader. Four sectors are outperforming the S&P 500 and technology isn't one of them. With ISM PMI manufacturing data back in expansion territory. We shouldn't be surprised that industrials are starting to take off. The split up of G.E. could be one of the biggest boost to the sector in decades. Larry Culp has engineered a miraculous turnaround, leaving the pure aerospace giant with a pristine balance sheet and an order book that extends to the horizon. The positive ISM data is a double edged sword. The 50.3 print didn't go unnoticed by Fed officials. In fact, on Thursday, Minneapolis Fed President Neel Kashkari trashed the markets, sending shares lower on the heels of his statement. The Fed may not cut this year. Over the last half century, the Fed has never started an easing cycle with ISM data in expansion territory. Anything that disrupts the current narrative sends the bots into action. Machines, are not price sensitive. If the algos say sell, it turns into the Terminator selling until there are no shares left. Thursday's price action delivered the second worst showing for the S&P 500 this year. We're going to have to get over our obsession with the Fed and even more important, Fed speak. Listening to Fed officials and trading off their comments is a money loser. Hotter than expected jobs were supposed to send shares lower. 303,000. That was the non-farm payroll print. Futures traded lower for about 30 seconds before taking off. I wonder what aliens looking down on stock traders would think they would see red blinking lights on Thursday, watching traders sell until the cupboard was bare. And then the following day the lights are green and we buy back everything we sold the day before. No wonder aliens won't talk to us. The challenges in front of us are many. First, the technical damage to the market is there to see 5265 in the S&P 500 has been met with selling a few times over the last month. Additionally, Nvidia’s outside Day last month marked its most recent peak. After hitting an all time high. A wave of selling took the shares 100 points lower. Been sideways. Ever since. Arguably the most important stock for technology bulls in that it is the poster child of artificial intelligence. If history is any guide, despite comments by Jay Powell and others, the Fed may not start easing until a market event forces their hand. What could that be? Clear data. The economy is starting to turn south. Inflation data that assures the 2% target is at hand. A crisis event like the collapse of another regional bank, or the increasing possibility that geopolitical events could spin out of control, forcing an economic downturn. All but one of those is bad. You heard it on this podcast a few weeks ago. Last year was about multiple expansion, and this year will be about earnings. In the long run, markets respond to corporate profitability. We're just days away from the start of earnings season. Let's see if the report cards justify the monster run we've seen this year. If you want access to the charts and transcript from today's podcast, sign up on my Substack page. DC Nelson123@Substack.com. And of course if you like today's pod, please hit subscribe. Hey, those of you who know me know I did the street thing for a while. Then I did this college thing. That didn't work out so well. I did this rock star thing. That was awesome. Now I'm doing this money thing. We'll see how it works out. I'm David Nelson. And this is The Money Runner.