1 00:00:02,720 --> 00:00:07,200 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. 2 00:00:08,440 --> 00:00:11,800 Speaker 2: It's been a bewildering week for retail investors trying to 3 00:00:11,840 --> 00:00:15,880 Speaker 2: make sense of global markets. After US President Donald Trump 4 00:00:15,960 --> 00:00:19,639 Speaker 2: unveiled sweeping new tariffs, we saw ten trillion dollars in 5 00:00:19,720 --> 00:00:23,680 Speaker 2: stock market value disappear. The US president is doubling down 6 00:00:24,120 --> 00:00:27,560 Speaker 2: on an economic policy that most economists think is de 7 00:00:27,960 --> 00:00:34,040 Speaker 2: anchored from reality. Then came Wednesday's stunning rebound, remarkable rally 8 00:00:34,040 --> 00:00:36,040 Speaker 2: we're seeing in the markets right now, up nearly ten 9 00:00:36,080 --> 00:00:39,920 Speaker 2: percentage points on the Nasdaq, and today markets have slid again. 10 00:00:40,200 --> 00:00:43,559 Speaker 2: Yesterday's terraf for Pree did not last long, with Ustok's 11 00:00:43,600 --> 00:00:45,960 Speaker 2: lab resuming their declined bonds not getting much love, the 12 00:00:46,000 --> 00:00:50,199 Speaker 2: dollar sliding, and corporate credit default risks rising. Meanwhile, the 13 00:00:50,360 --> 00:00:54,440 Speaker 2: US and China, the world's two largest economies, have continued 14 00:00:54,480 --> 00:00:56,560 Speaker 2: to ramp up the pressure on each other with a 15 00:00:56,600 --> 00:01:01,240 Speaker 2: series of compounding tariffs. President Trump's tariff on Chinese imports 16 00:01:01,240 --> 00:01:04,720 Speaker 2: have reached one hundred and forty five percent, factoring in 17 00:01:04,760 --> 00:01:07,640 Speaker 2: a twenty percent levee placed on China over its role 18 00:01:07,720 --> 00:01:12,080 Speaker 2: in fentanyl trafficking, and China has said it's raising tariffs 19 00:01:12,080 --> 00:01:16,960 Speaker 2: on US imports to eighty four percent. Bloomberg's Charlie Wells says, 20 00:01:17,000 --> 00:01:20,080 Speaker 2: all of this creates a lot of uncertainty for businesses, 21 00:01:20,480 --> 00:01:24,600 Speaker 2: which translates into uncertainty for investors of all kinds. 22 00:01:25,720 --> 00:01:28,920 Speaker 1: We actually had a Bloomberg report about Walmart telling a 23 00:01:29,000 --> 00:01:32,880 Speaker 1: company just a few days ago in China not to 24 00:01:33,040 --> 00:01:37,240 Speaker 1: put sticker prices on Christmas ornaments because there's just so 25 00:01:37,319 --> 00:01:39,440 Speaker 1: much uncertainty about how much things are going to cost 26 00:01:39,959 --> 00:01:43,679 Speaker 1: come Christmas. So, you know, beyond ninety days, beyond this 27 00:01:43,800 --> 00:01:46,200 Speaker 1: pause that Trump has put into place, there's still going 28 00:01:46,240 --> 00:01:48,040 Speaker 1: to be a lot of uncertainty and that's probably going 29 00:01:48,120 --> 00:01:49,480 Speaker 1: to play out in the stock market too. 30 00:01:49,840 --> 00:01:52,640 Speaker 2: As a personal finance reporter, Charlie hears from a lot 31 00:01:52,640 --> 00:01:55,960 Speaker 2: of people looking for guidance from experts on what financial 32 00:01:56,000 --> 00:01:59,200 Speaker 2: moves they should be making. And he says, these past 33 00:01:59,240 --> 00:02:02,200 Speaker 2: few weeks, everyone's been wondering the same thing. 34 00:02:02,760 --> 00:02:05,080 Speaker 1: So the big question that I get is really simple, 35 00:02:05,320 --> 00:02:07,920 Speaker 1: but it's a really hard one to answer, and it's 36 00:02:08,240 --> 00:02:11,960 Speaker 1: what should I do with my money? Right now? 37 00:02:13,440 --> 00:02:15,720 Speaker 2: I'm Sarah Holder, and this is the big take from 38 00:02:15,760 --> 00:02:19,000 Speaker 2: Bloomberg News today on the show. In the midst of 39 00:02:19,080 --> 00:02:21,839 Speaker 2: all this uncertainty. We're going to take a look at 40 00:02:21,919 --> 00:02:25,000 Speaker 2: your money. We'll here expert advice on what to do 41 00:02:25,080 --> 00:02:28,280 Speaker 2: with it right now and in the weeks and months ahead. 42 00:02:33,240 --> 00:02:36,440 Speaker 2: Wild swings in the stock market are anxiety inducing for 43 00:02:36,639 --> 00:02:40,160 Speaker 2: all kinds of investors. So if you're nervous, you're not alone. 44 00:02:40,880 --> 00:02:43,440 Speaker 2: Charlie says he's heard from a lot of readers this week, 45 00:02:43,560 --> 00:02:47,359 Speaker 2: including someone who did the one thing financial experts really 46 00:02:47,400 --> 00:02:48,840 Speaker 2: don't want their clients to do. 47 00:02:49,280 --> 00:02:51,480 Speaker 1: She said that she was so relieved that she sold 48 00:02:51,639 --> 00:02:54,360 Speaker 1: out of her stock portfolio. And this was someone in 49 00:02:54,400 --> 00:02:57,480 Speaker 1: her thirties. This is someone who has a long time horizon, 50 00:02:57,520 --> 00:02:59,760 Speaker 1: who you know, any expert would say has a really 51 00:03:00,080 --> 00:03:03,440 Speaker 1: high risk tolerance. Instead of kind of staying in the 52 00:03:03,480 --> 00:03:07,399 Speaker 1: market as most financial advisors would recommend, she sold out 53 00:03:07,480 --> 00:03:09,680 Speaker 1: and is sitting in cash. And that's kind of not 54 00:03:09,840 --> 00:03:11,400 Speaker 1: the sort of thing that you're supposed to do, But 55 00:03:11,440 --> 00:03:14,120 Speaker 1: it represents the level of fear that there is in 56 00:03:14,160 --> 00:03:17,000 Speaker 1: the market right now. It represents the fact that people 57 00:03:17,080 --> 00:03:20,680 Speaker 1: are really trying to navigate the uncertainty right now, and 58 00:03:20,720 --> 00:03:23,080 Speaker 1: a lot of people think that that's just being in cash, 59 00:03:23,320 --> 00:03:25,160 Speaker 1: but that's not a great idea, and we just have 60 00:03:25,400 --> 00:03:29,400 Speaker 1: so much data on that. When you sell, you lock 61 00:03:29,520 --> 00:03:32,519 Speaker 1: in the loss, but when you stay in the market, 62 00:03:33,160 --> 00:03:36,160 Speaker 1: it's just a paper loss that very likely is going 63 00:03:36,200 --> 00:03:36,640 Speaker 1: to recover. 64 00:03:37,280 --> 00:03:40,720 Speaker 2: What about if you have less risk tolerance, if you're older, say, 65 00:03:40,840 --> 00:03:42,120 Speaker 2: if you're nearing retirement. 66 00:03:42,720 --> 00:03:44,760 Speaker 1: This is one of the issues that has been really 67 00:03:44,760 --> 00:03:49,119 Speaker 1: difficult lately. People who need to sell because they are 68 00:03:49,640 --> 00:03:52,760 Speaker 1: going to leave the workforce because they are retiring. And 69 00:03:53,040 --> 00:03:57,160 Speaker 1: a lot of people had asked, you know, how much 70 00:03:57,240 --> 00:03:59,480 Speaker 1: stock should I have? Is this market going to keep 71 00:03:59,520 --> 00:04:01,840 Speaker 1: going up and up? And a lot of you know, 72 00:04:01,920 --> 00:04:04,280 Speaker 1: people who were nearing retirement I think, were maybe a 73 00:04:04,320 --> 00:04:07,440 Speaker 1: little bit overly optimistic about the trajectory of the stock 74 00:04:07,480 --> 00:04:09,960 Speaker 1: market because one of the things that we know is 75 00:04:10,480 --> 00:04:15,000 Speaker 1: that you know, it does recover after downturns, but it 76 00:04:15,080 --> 00:04:18,839 Speaker 1: also turns down, and so just getting caught up in 77 00:04:18,880 --> 00:04:21,120 Speaker 1: some of this timing I think has been difficult for 78 00:04:21,160 --> 00:04:25,640 Speaker 1: a lot of retirees. And there's been this temptation over 79 00:04:25,720 --> 00:04:29,239 Speaker 1: the past two three years, as we've seen this huge 80 00:04:29,279 --> 00:04:33,800 Speaker 1: stock rally to maybe over allocate to stocks because it 81 00:04:33,800 --> 00:04:35,840 Speaker 1: seems like the good times are going to keep on rolling. 82 00:04:36,240 --> 00:04:38,360 Speaker 1: As we learned over the past week they're not. 83 00:04:40,200 --> 00:04:42,039 Speaker 2: Well. One of the things that investors have been paying 84 00:04:42,080 --> 00:04:45,440 Speaker 2: particular attention to, something we covered on The Big Take yesterday, 85 00:04:45,720 --> 00:04:48,480 Speaker 2: where the swings in the bond market. Earlier this week 86 00:04:48,480 --> 00:04:51,920 Speaker 2: we saw the selloff in US treasuries which sent yield surging. 87 00:04:53,120 --> 00:04:54,840 Speaker 2: Can you explain why that's such a big deal. 88 00:04:55,360 --> 00:04:58,240 Speaker 1: It's a big deal because it was really unusual. And 89 00:04:58,320 --> 00:05:01,320 Speaker 1: so usually what happens is is when there's a lot 90 00:05:01,320 --> 00:05:04,120 Speaker 1: of fear in the stock market, investors want to go 91 00:05:04,279 --> 00:05:07,400 Speaker 1: someplace safe. They want to go someplace where they know that, 92 00:05:07,880 --> 00:05:11,039 Speaker 1: you know, they've got the full faith and credit of 93 00:05:11,080 --> 00:05:15,960 Speaker 1: something that's really responsible, and usually that is the US 94 00:05:16,080 --> 00:05:19,040 Speaker 1: government bond market. Those are US treasuries that people tend 95 00:05:19,040 --> 00:05:22,400 Speaker 1: to turn to, and so when stock prices go down, 96 00:05:22,800 --> 00:05:26,120 Speaker 1: people usually want US treasuries, these bonds, and so those 97 00:05:26,240 --> 00:05:29,640 Speaker 1: bond prices go up and then the yields go down. 98 00:05:29,960 --> 00:05:33,240 Speaker 1: But this past week, something really weird happened, and it 99 00:05:33,360 --> 00:05:37,960 Speaker 1: was that as stocks went down, prices went down, which 100 00:05:38,120 --> 00:05:41,120 Speaker 1: meant that bond yields went up. And this is just 101 00:05:41,320 --> 00:05:45,320 Speaker 1: not something that we're used to seeing in financial markets. 102 00:05:45,600 --> 00:05:49,480 Speaker 2: Well, if US treasuries are looking less safe, what does 103 00:05:49,520 --> 00:05:52,400 Speaker 2: that mean for the typical sixty forty split many of 104 00:05:52,480 --> 00:05:56,160 Speaker 2: us think of as classic investing advice for portfolios. 105 00:05:56,760 --> 00:05:59,040 Speaker 1: Yeah, so I think that, you know, the sixty forty 106 00:05:59,200 --> 00:06:02,520 Speaker 1: is a very you know, time tested strategy. It's been 107 00:06:02,600 --> 00:06:05,400 Speaker 1: under pressure over the past few years of kind of 108 00:06:05,440 --> 00:06:09,280 Speaker 1: getting the right mix between stocks and bonds, getting risk 109 00:06:09,360 --> 00:06:11,880 Speaker 1: from stocks with the safety of bonds. And I think 110 00:06:11,960 --> 00:06:15,840 Speaker 1: if there is this belief that US treasuries are not 111 00:06:15,880 --> 00:06:18,000 Speaker 1: as secure, you know, as we've known them to be 112 00:06:18,160 --> 00:06:21,200 Speaker 1: for so many decades, that maybe that strategy isn't a 113 00:06:21,200 --> 00:06:25,159 Speaker 1: smart one. But I think it's too soon to call 114 00:06:25,200 --> 00:06:27,640 Speaker 1: for the end of the sixty to forty portfolio. I 115 00:06:27,680 --> 00:06:31,159 Speaker 1: think that one point that financial advisors always make to 116 00:06:31,200 --> 00:06:35,120 Speaker 1: me is just because you're seeing one day this highly 117 00:06:35,240 --> 00:06:39,839 Speaker 1: unusual event in markets, that could look like evidence that 118 00:06:40,160 --> 00:06:43,040 Speaker 1: people no longer have full faith and confidence in the 119 00:06:43,240 --> 00:06:46,360 Speaker 1: in the United States, that there is concern about the 120 00:06:46,360 --> 00:06:48,839 Speaker 1: credit worthiness of the United States. You might feel that 121 00:06:48,880 --> 00:06:51,000 Speaker 1: one day, but then the next things start to recover 122 00:06:51,040 --> 00:06:52,760 Speaker 1: and we move on, and so making a kind of 123 00:06:52,920 --> 00:06:56,520 Speaker 1: drastic change changing some of these fundamental assumptions that we 124 00:06:56,600 --> 00:06:58,080 Speaker 1: have can be really dangerous. 125 00:06:58,560 --> 00:07:01,160 Speaker 2: I want to make sure people understand that the significance 126 00:07:01,160 --> 00:07:04,240 Speaker 2: of higher yields in the bond market, how might that 127 00:07:04,279 --> 00:07:06,279 Speaker 2: show up in people's everyday lives. 128 00:07:06,520 --> 00:07:09,200 Speaker 1: Yeah, so you know, the everyday person isn't necessarily sitting 129 00:07:09,200 --> 00:07:12,320 Speaker 1: around thinking about the yield on the tenure treasury. But 130 00:07:13,080 --> 00:07:16,240 Speaker 1: ten year treasuries are really important because they're benchmarks for 131 00:07:16,360 --> 00:07:20,360 Speaker 1: a lot of the consumer products, the kind of consumer 132 00:07:20,440 --> 00:07:23,880 Speaker 1: borrowing that we see in the everyday economy. So the 133 00:07:23,920 --> 00:07:28,040 Speaker 1: ten year treasuries used as a benchmark for thirty year mortgages, 134 00:07:28,240 --> 00:07:32,440 Speaker 1: It influences student loan borrowing rates, credit card rates, and 135 00:07:32,480 --> 00:07:37,000 Speaker 1: so it really does trickle down into the everyday economy. 136 00:07:37,080 --> 00:07:40,480 Speaker 1: So if you're seeing that yield go up really high, 137 00:07:40,840 --> 00:07:45,240 Speaker 1: that means basically that you know, mortgage prices will eventually 138 00:07:45,280 --> 00:07:48,080 Speaker 1: be higher, that the amount that it costs to borrow 139 00:07:48,080 --> 00:07:51,680 Speaker 1: will be higher because that benchmark that so many lenders 140 00:07:51,800 --> 00:07:53,280 Speaker 1: use has gone up. 141 00:07:53,640 --> 00:07:56,160 Speaker 2: So, Charlie, people are coming to you asking what should 142 00:07:56,160 --> 00:07:58,679 Speaker 2: I do with my money right now? Bloomberg recently published 143 00:07:58,680 --> 00:08:01,840 Speaker 2: a piece about investing in time of market uncertainty, and 144 00:08:01,920 --> 00:08:04,960 Speaker 2: one thing that the experts who spoke to Bloomberg encourage 145 00:08:05,000 --> 00:08:08,880 Speaker 2: everyday investors to do was evaluate their portfolios. What does 146 00:08:08,880 --> 00:08:11,560 Speaker 2: that actually look like in practice, and what do experts 147 00:08:11,560 --> 00:08:13,280 Speaker 2: say people should do right now? 148 00:08:13,800 --> 00:08:18,040 Speaker 1: Advisors usually say, you know, before you make any moves 149 00:08:18,080 --> 00:08:20,600 Speaker 1: at all, before you try to take advantage of moves 150 00:08:20,640 --> 00:08:22,600 Speaker 1: in the market, Before you know, you try to buy 151 00:08:22,640 --> 00:08:24,720 Speaker 1: the dip. As we hear a lot of people talking about, 152 00:08:24,920 --> 00:08:26,840 Speaker 1: you just want to make sure that you're in a 153 00:08:26,920 --> 00:08:31,800 Speaker 1: really safe, comfortable financial position where if the uncertainty in 154 00:08:31,840 --> 00:08:35,720 Speaker 1: the stock market translated into say the job market, and 155 00:08:35,760 --> 00:08:38,600 Speaker 1: you were to lose your job, you would be okay 156 00:08:38,760 --> 00:08:40,480 Speaker 1: for the length of time that it might take for 157 00:08:40,520 --> 00:08:43,120 Speaker 1: you to find another job. And so really step one 158 00:08:43,559 --> 00:08:45,520 Speaker 1: whenever we're in a time of uncertainty is to make 159 00:08:45,520 --> 00:08:48,160 Speaker 1: sure you've got an emergency fund that you know. That 160 00:08:48,280 --> 00:08:51,400 Speaker 1: number on the emergency fund varies from as little as 161 00:08:51,440 --> 00:08:55,160 Speaker 1: three months to a year, but advisors really say, you 162 00:08:55,200 --> 00:08:57,960 Speaker 1: want to have three months to a year's worth of 163 00:08:58,000 --> 00:09:01,360 Speaker 1: salary socked away just so you can absorb any shocks. 164 00:09:01,440 --> 00:09:04,280 Speaker 1: So that's kind of step one. And even if you've 165 00:09:04,320 --> 00:09:06,400 Speaker 1: got that, even if you've you know, you feel like 166 00:09:06,440 --> 00:09:09,280 Speaker 1: your savings are pretty good. Something that you can do 167 00:09:09,440 --> 00:09:11,160 Speaker 1: in a moment like now is just to kind of 168 00:09:11,160 --> 00:09:13,280 Speaker 1: take stock just just to check in. I think a 169 00:09:13,320 --> 00:09:16,120 Speaker 1: lot of times we've got you know, some savings in 170 00:09:16,200 --> 00:09:19,600 Speaker 1: one bank account, we've got you know, eye bonds somewhere else, 171 00:09:19,720 --> 00:09:22,040 Speaker 1: we put you know, the four oh one k in another, 172 00:09:22,080 --> 00:09:24,360 Speaker 1: and just kind of getting it all organized. Really is 173 00:09:24,400 --> 00:09:24,960 Speaker 1: step one. 174 00:09:25,600 --> 00:09:27,839 Speaker 2: One of the first steps for people right now might 175 00:09:27,880 --> 00:09:30,720 Speaker 2: be to take stock of where they're at. But something 176 00:09:30,760 --> 00:09:33,040 Speaker 2: we keep hearing is don't look at your four to 177 00:09:33,040 --> 00:09:36,160 Speaker 2: oh one k. Is there a point at which that changes? 178 00:09:36,280 --> 00:09:38,880 Speaker 2: Is there a point where financial advisors say people should 179 00:09:38,960 --> 00:09:41,520 Speaker 2: jump in, should look closer at their four oh one 180 00:09:41,600 --> 00:09:43,720 Speaker 2: ks in a time of market uncertainty. 181 00:09:44,440 --> 00:09:47,240 Speaker 1: Yeah, So advisors don't like people to look at their 182 00:09:47,280 --> 00:09:51,800 Speaker 1: long term investments because you know, historically, we know that 183 00:09:51,920 --> 00:09:55,040 Speaker 1: stock markets recover that anyone who does look at their 184 00:09:55,040 --> 00:09:57,480 Speaker 1: four oh one k now is probably going to see 185 00:09:57,520 --> 00:10:00,840 Speaker 1: a really disappointing dip. But that doesn't mean that you 186 00:10:00,880 --> 00:10:04,720 Speaker 1: can't do nothing. And I think one of the points 187 00:10:04,760 --> 00:10:08,560 Speaker 1: that I've heard from experts over the past few weeks is, 188 00:10:08,920 --> 00:10:10,880 Speaker 1: you know, now could be a good time to kind 189 00:10:10,920 --> 00:10:15,760 Speaker 1: of reassess your investment strategy and dollar cost average. If 190 00:10:15,800 --> 00:10:17,920 Speaker 1: you do want to make some kind of change. And 191 00:10:17,960 --> 00:10:21,960 Speaker 1: so what that means is, instead of say, you know, 192 00:10:22,440 --> 00:10:25,600 Speaker 1: dumping a bunch of cash into the market right now, 193 00:10:26,200 --> 00:10:28,720 Speaker 1: you might take a certain amount and put it in 194 00:10:28,840 --> 00:10:32,280 Speaker 1: over a fixed amount of time. So say, instead of 195 00:10:32,320 --> 00:10:35,640 Speaker 1: putting you know, ten thousand dollars into the stock market 196 00:10:35,679 --> 00:10:38,000 Speaker 1: right now because you think prices are really good, you 197 00:10:38,080 --> 00:10:40,800 Speaker 1: might put two thousand into the market for the next 198 00:10:40,800 --> 00:10:45,000 Speaker 1: five months. And what that does is it helps you 199 00:10:45,080 --> 00:10:49,200 Speaker 1: get access and exposure to the stock market, but without 200 00:10:49,240 --> 00:10:53,000 Speaker 1: necessarily risking the fact that stocks could keep going down 201 00:10:53,040 --> 00:10:57,439 Speaker 1: from here right. I think that's one of the main concerns, 202 00:10:57,600 --> 00:11:00,600 Speaker 1: and that's one of the reasons why advisors don't like people, 203 00:11:01,000 --> 00:11:03,360 Speaker 1: you know, looking at these long term investments too much, 204 00:11:03,400 --> 00:11:05,840 Speaker 1: because it could make them feel like, oh, my goodness, 205 00:11:06,440 --> 00:11:09,959 Speaker 1: you know, Apple's down, Tesla's down, everything's down. I'll get 206 00:11:09,960 --> 00:11:13,880 Speaker 1: a great discount. Dollar cost averaging allows you to kind of, yes, 207 00:11:14,480 --> 00:11:17,840 Speaker 1: clock some of what seems like a discount now, then 208 00:11:17,960 --> 00:11:20,839 Speaker 1: also hedge the fact that these stocks could be discounted 209 00:11:20,880 --> 00:11:21,840 Speaker 1: even more in the future. 210 00:11:22,400 --> 00:11:24,000 Speaker 2: So it's not just don't look at your four owe 211 00:11:24,040 --> 00:11:26,079 Speaker 2: k because it might make you super anxious. It's don't 212 00:11:26,120 --> 00:11:27,640 Speaker 2: look at your four o one k because you don't 213 00:11:27,640 --> 00:11:30,079 Speaker 2: want to make rash decisions. 214 00:11:30,120 --> 00:11:33,520 Speaker 1: That's right, But also you can make decisions and you 215 00:11:33,559 --> 00:11:35,520 Speaker 1: can look to see, like, you know what, maybe I'm 216 00:11:35,559 --> 00:11:38,800 Speaker 1: not as comfortable with how much equity I have in 217 00:11:38,840 --> 00:11:42,920 Speaker 1: my portfolio. And what one really smart advisor told me 218 00:11:43,000 --> 00:11:45,080 Speaker 1: was use this as a little bit of a test 219 00:11:45,480 --> 00:11:47,959 Speaker 1: as a sign, like, how did the past week make 220 00:11:48,040 --> 00:11:50,280 Speaker 1: you feel? Were you comfortable seeing that four to oh 221 00:11:50,320 --> 00:11:53,200 Speaker 1: one k go down? Or was it just too much? 222 00:11:53,679 --> 00:11:56,240 Speaker 1: And if it was just too much, you might need 223 00:11:56,240 --> 00:11:59,559 Speaker 1: to change into less risky assets. You might need to 224 00:11:59,559 --> 00:12:02,079 Speaker 1: think about out maybe more bonds, you might need to 225 00:12:02,120 --> 00:12:04,840 Speaker 1: think about holding more cash. It's just sort of a 226 00:12:04,880 --> 00:12:08,040 Speaker 1: sign that maybe the way that you've allocated your portfolio 227 00:12:08,679 --> 00:12:09,680 Speaker 1: isn't right for you. 228 00:12:12,800 --> 00:12:15,360 Speaker 2: So that's what experts are saying you do right now 229 00:12:15,440 --> 00:12:18,920 Speaker 2: to get through this period of market uncertainty. But what 230 00:12:19,040 --> 00:12:33,600 Speaker 2: about down the road that's next. On Wednesday morning, just 231 00:12:33,720 --> 00:12:36,440 Speaker 2: before the White House announced a pause of some tariffs 232 00:12:36,440 --> 00:12:40,200 Speaker 2: that sent market surging, President Donald Trump posted on truth 233 00:12:40,240 --> 00:12:43,800 Speaker 2: Social Be Cool. He said, this is a great time 234 00:12:43,840 --> 00:12:47,400 Speaker 2: to buy. I wanted to ask Bloomberg Personal finance reporter 235 00:12:47,600 --> 00:12:51,000 Speaker 2: Charlie Wells if he was hearing the same from financial experts. 236 00:12:51,640 --> 00:12:54,960 Speaker 2: Should everyday investors start moving money into the market. 237 00:12:55,320 --> 00:12:57,680 Speaker 1: So I'll give you a qualified yes, And it's not 238 00:12:57,840 --> 00:13:01,600 Speaker 1: a terrible time to buy the dip if and this 239 00:13:01,640 --> 00:13:04,920 Speaker 1: is a big if you have the time horizon, you 240 00:13:05,040 --> 00:13:07,400 Speaker 1: have the risk tolerance, and you have the cash to 241 00:13:07,520 --> 00:13:10,360 Speaker 1: do it. So the big picture idea here is that 242 00:13:10,400 --> 00:13:13,080 Speaker 1: when the stock market goes down in a lot of ways, 243 00:13:13,120 --> 00:13:15,480 Speaker 1: it means that a lot of high quality companies that 244 00:13:15,559 --> 00:13:19,800 Speaker 1: maybe were overvalue, that maybe were just expensive, there are 245 00:13:19,840 --> 00:13:23,319 Speaker 1: prices come down, and there's a high likelihood that at 246 00:13:23,320 --> 00:13:25,880 Speaker 1: some point in the future, maybe even the near future, 247 00:13:26,240 --> 00:13:28,520 Speaker 1: there are prices will go back up again. And so 248 00:13:29,040 --> 00:13:32,280 Speaker 1: if you're someone who has their emergency fund covered, if 249 00:13:32,320 --> 00:13:36,880 Speaker 1: you're someone who has paid off high interest debts, then 250 00:13:36,920 --> 00:13:38,840 Speaker 1: maybe this is something that you could think about and 251 00:13:38,920 --> 00:13:42,000 Speaker 1: really kind of in the broadest strokes, people who are 252 00:13:42,040 --> 00:13:44,920 Speaker 1: further away from retirement, who have a lot more time 253 00:13:45,480 --> 00:13:48,240 Speaker 1: for the stock market to recover, or in a position 254 00:13:48,280 --> 00:13:51,320 Speaker 1: where they could do this. And so yes, every financial 255 00:13:51,320 --> 00:13:53,600 Speaker 1: advisor that I called this week told me that now 256 00:13:53,679 --> 00:13:56,360 Speaker 1: could be a good time to buy the dip if 257 00:13:56,360 --> 00:13:57,720 Speaker 1: you do it in a responsible way. 258 00:13:58,160 --> 00:14:01,280 Speaker 2: Are there any industries that financial experts say are better 259 00:14:01,559 --> 00:14:05,440 Speaker 2: safer bets right now? Any industries that have generally been 260 00:14:05,720 --> 00:14:06,560 Speaker 2: recession proof. 261 00:14:07,320 --> 00:14:10,200 Speaker 1: So I get a lot of vanilla answers when I 262 00:14:10,280 --> 00:14:13,280 Speaker 1: ask about this, and advisors are always really reluctant to 263 00:14:13,360 --> 00:14:17,480 Speaker 1: tell me, you know, go into this particular industry. When 264 00:14:17,480 --> 00:14:19,960 Speaker 1: advisor in California talked about how, you know, there is 265 00:14:20,000 --> 00:14:23,040 Speaker 1: some concern about the direction of the US and if 266 00:14:23,080 --> 00:14:25,640 Speaker 1: that is a conviction that you have, you might want 267 00:14:25,640 --> 00:14:30,240 Speaker 1: to look at global companies global indices as well. And 268 00:14:30,280 --> 00:14:34,000 Speaker 1: then you know, generally in times of recession, people talk about, 269 00:14:34,080 --> 00:14:37,280 Speaker 1: you know, investing in areas that consumers are still going 270 00:14:37,320 --> 00:14:40,640 Speaker 1: to spend on even if they've lost their jobs, right, 271 00:14:40,720 --> 00:14:44,280 Speaker 1: So that would be consumer staples, healthcare, the sorts of 272 00:14:44,320 --> 00:14:48,000 Speaker 1: things that people need to buy regardless of how flush 273 00:14:48,040 --> 00:14:50,760 Speaker 1: they're feeling. But the important thing here really, and I 274 00:14:50,920 --> 00:14:52,520 Speaker 1: just this comes up all the time, and I think 275 00:14:52,560 --> 00:14:54,880 Speaker 1: it is because it is good advice. You want to 276 00:14:54,920 --> 00:14:57,920 Speaker 1: be diversified, and it's so fun to think that you've 277 00:14:57,960 --> 00:15:02,400 Speaker 1: got the insider info on one particular company, but they're 278 00:15:02,640 --> 00:15:05,720 Speaker 1: the high probability is you might not know as much 279 00:15:05,840 --> 00:15:08,600 Speaker 1: as someone whose entire job it is to follow stocks, 280 00:15:08,600 --> 00:15:12,400 Speaker 1: to follow a particular company, and so diversification really is important. 281 00:15:15,840 --> 00:15:19,400 Speaker 2: Well, right, what about other places to investor capital outside 282 00:15:19,440 --> 00:15:24,320 Speaker 2: the stock market, like buying property or buying commodities like golds? 283 00:15:24,400 --> 00:15:26,600 Speaker 2: What do experts say the move is there? 284 00:15:27,320 --> 00:15:30,160 Speaker 1: So, you know, I think for the average investor, it's 285 00:15:30,200 --> 00:15:33,320 Speaker 1: really hard to find, you know, the right balance. I 286 00:15:33,320 --> 00:15:36,680 Speaker 1: think diversification is important. I think a lot of portfolios, 287 00:15:36,760 --> 00:15:40,320 Speaker 1: especially for younger people, probably should be, you know, more 288 00:15:40,360 --> 00:15:44,400 Speaker 1: in stock than almost anything else. But we're inundated with 289 00:15:44,960 --> 00:15:51,600 Speaker 1: thin influencers, with internet articles about you know, storage units 290 00:15:51,640 --> 00:15:55,720 Speaker 1: and rental properties and all of this stuff. And one 291 00:15:56,240 --> 00:15:59,240 Speaker 1: very real conversation I have with a financial advisor we 292 00:15:59,280 --> 00:16:03,280 Speaker 1: address these kind of alternate investment ideas, and you know 293 00:16:03,360 --> 00:16:05,840 Speaker 1: what he told me was, if you want to invest 294 00:16:05,920 --> 00:16:08,680 Speaker 1: in something, the best thing that you can invest in 295 00:16:08,760 --> 00:16:12,160 Speaker 1: is your job, because you know what the return is 296 00:16:12,160 --> 00:16:13,840 Speaker 1: going to be on that investment, you know what the 297 00:16:13,960 --> 00:16:16,400 Speaker 1: risks are, and actually the amount of money that you 298 00:16:16,520 --> 00:16:19,120 Speaker 1: get from your job is probably a lot more than 299 00:16:19,160 --> 00:16:22,920 Speaker 1: it's going to be from a storage unit business that 300 00:16:22,960 --> 00:16:25,960 Speaker 1: you take part in. And then think about things like gold. 301 00:16:26,040 --> 00:16:29,200 Speaker 1: I mean, it's reaching peaks right now. I think people 302 00:16:29,240 --> 00:16:32,440 Speaker 1: have tried to count out gold for a long time. Obviously, 303 00:16:32,480 --> 00:16:37,120 Speaker 1: owning physical gold is more challenging than stocks. There are ETFs, 304 00:16:37,160 --> 00:16:40,640 Speaker 1: of course that you can buy, but you know, small 305 00:16:40,680 --> 00:16:43,560 Speaker 1: allocations here, I think really kind of sticking to the 306 00:16:43,560 --> 00:16:46,600 Speaker 1: bread and butter is what most mainstream advisors would recommend. 307 00:16:46,800 --> 00:16:49,840 Speaker 2: That's so funny. He's like, get off TikTok, stop browsing 308 00:16:49,960 --> 00:16:54,080 Speaker 2: commodities markets, just do your job. Literally that well, it's 309 00:16:54,120 --> 00:16:57,000 Speaker 2: really hard to time the market, as we've been talking about, 310 00:16:57,080 --> 00:17:00,920 Speaker 2: especially in a volatile whip sawing period like this. But 311 00:17:01,000 --> 00:17:04,000 Speaker 2: what about timing other money moves. We've been reporting at 312 00:17:04,000 --> 00:17:07,640 Speaker 2: Bloomberg on some consumers panic buying certain products. What do 313 00:17:07,680 --> 00:17:10,720 Speaker 2: the experts say about these sorts of purchases, whether it's 314 00:17:10,760 --> 00:17:14,240 Speaker 2: a car or like a home appliance like an air conditioner. 315 00:17:14,520 --> 00:17:16,760 Speaker 1: So the best practice is to ask yourself do you 316 00:17:16,840 --> 00:17:19,199 Speaker 1: need it and can you afford it? And if you 317 00:17:19,240 --> 00:17:22,119 Speaker 1: can answer yes to both of those questions, you should 318 00:17:22,280 --> 00:17:26,000 Speaker 1: probably buy it. But there's a flip side here where 319 00:17:26,240 --> 00:17:29,720 Speaker 1: you know, some economists have been saying that these terriffs 320 00:17:29,840 --> 00:17:34,359 Speaker 1: could eventually lead to a recession in recessions, companies often 321 00:17:34,440 --> 00:17:37,440 Speaker 1: have to discount because demand goes down, so you don't 322 00:17:37,480 --> 00:17:40,280 Speaker 1: want to get into a position where you've rushed to 323 00:17:40,320 --> 00:17:43,600 Speaker 1: buy something to try to beat tariffs, and then this 324 00:17:43,720 --> 00:17:47,800 Speaker 1: hypothetical world of a recession sets in and then things 325 00:17:47,800 --> 00:17:48,400 Speaker 1: got cheaper. 326 00:17:48,680 --> 00:17:51,280 Speaker 2: I asked you last time we spoke about whether pulling 327 00:17:51,280 --> 00:17:53,920 Speaker 2: out of the stock market altogether would be a strategic 328 00:17:54,000 --> 00:17:56,320 Speaker 2: move if the safest place for your money was under 329 00:17:56,359 --> 00:18:00,720 Speaker 2: your mattress. You said. Advisors were saying, essentially, keep putting 330 00:18:00,720 --> 00:18:03,200 Speaker 2: a study amount into the market over time, in part 331 00:18:03,280 --> 00:18:07,840 Speaker 2: as a hedge against inflation. What about now, Has anything changed? 332 00:18:09,080 --> 00:18:11,560 Speaker 1: I would say no. In fact, I would say that 333 00:18:12,320 --> 00:18:15,160 Speaker 1: the standard advisor, who knows that you've got all your 334 00:18:15,160 --> 00:18:19,120 Speaker 1: basis checked, would say keep investing, keep going, because even 335 00:18:19,119 --> 00:18:22,240 Speaker 1: in the past few days, we've seen these significant drops, 336 00:18:22,560 --> 00:18:26,040 Speaker 1: but as we've been talking about whipsawing, we've also seen recoveries. 337 00:18:26,440 --> 00:18:29,119 Speaker 1: And that is kind of in a nutshell what happens 338 00:18:29,119 --> 00:18:32,880 Speaker 1: in the stock market. You know, it feels like decades 339 00:18:33,080 --> 00:18:35,840 Speaker 1: have been compressed down into days. But if you take 340 00:18:35,880 --> 00:18:39,080 Speaker 1: what's happened over the past few days and then stretch 341 00:18:39,119 --> 00:18:43,040 Speaker 1: it out over many decades, That's what happens. It goes up, 342 00:18:43,280 --> 00:18:45,119 Speaker 1: it goes down, and then goes back up again. 343 00:18:51,480 --> 00:18:54,399 Speaker 2: This is the Big Take from Bloomberg News. I'm Sarah Holder. 344 00:18:54,680 --> 00:18:57,520 Speaker 2: This episode was produced by David Fox. It was edited 345 00:18:57,520 --> 00:19:01,040 Speaker 2: by Patty Hirsch and Brian Chapata, fact checked by adrian 346 00:19:01,080 --> 00:19:03,960 Speaker 2: Na Tapia, and mixed and sound designed by Alex Suguia. 347 00:19:04,400 --> 00:19:07,440 Speaker 2: Our senior producer is Naomi Shaven. Our senior editor is 348 00:19:07,480 --> 00:19:11,600 Speaker 2: Elizabeth Ponso. Our deputy executive producer is Julia Weaver. Our 349 00:19:11,640 --> 00:19:15,760 Speaker 2: executive producer is Nicole Beamster. Boord Sage Bauman is Bloomberg's 350 00:19:15,760 --> 00:19:18,880 Speaker 2: head of podcasts. If you liked this episode, make sure 351 00:19:18,920 --> 00:19:21,560 Speaker 2: to subscribe and review The Big Take wherever you listen 352 00:19:21,600 --> 00:19:25,639 Speaker 2: to podcasts. It helps people find the show. Thanks for listening. 353 00:19:25,960 --> 00:19:27,480 Speaker 2: We'll be back tomorrow.