WEBVTT - Nancy Daoud on the Markets (Radio)

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<v Speaker 1>Let's get to our guest, Nancy Dowd private wealth advisor

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<v Speaker 1>or Prise Financial. So we're getting a lot of cross

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<v Speaker 1>currents here in the earnings picture. It doesn't seem to

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<v Speaker 1>be clearing things up. The double digit forecast upgrade for

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<v Speaker 1>Microsoft's earnings next year, it gives you kind of a

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<v Speaker 1>warm and fuzzy feeling. But then when you look at

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<v Speaker 1>what Walmart delivered yesterday, it's it's all pretty confusing. The

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<v Speaker 1>bears would argue that, look, eventually everything's going to get hit.

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<v Speaker 1>You have the Fed writing a trade for freight train,

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<v Speaker 1>trying to get after inflation, and that's into a slowing economy.

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<v Speaker 1>Sell now come back later your thoughts. Yes, but you

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<v Speaker 1>know the we said that corporate earnings are strong, and

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<v Speaker 1>everyone was very concerned about earning. So there's a bit

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<v Speaker 1>of validation there. Uh. And yes, there's a lot of

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<v Speaker 1>confusion and they're very The Walmart reports certainly indicates that.

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<v Speaker 1>But the reality and everyone's talking about are we in

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<v Speaker 1>a recession or are we going into recession? Well, the

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<v Speaker 1>reality is that the market already pressed all that in.

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<v Speaker 1>So now tomorrow the big Sad meeting will will they

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<v Speaker 1>raise interest rates? Three quarters of a point, Will it

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<v Speaker 1>be half a point, will it be one again? Lots

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<v Speaker 1>of speculation, But the said has a very big job

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<v Speaker 1>to do, and it's not just raising interest rates. There

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<v Speaker 1>has to be a reorganization of the balance sheet, there

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<v Speaker 1>has to be a spending curb, there has to be

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<v Speaker 1>some tightening. There's there's a long checklist of things that

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<v Speaker 1>have to be done besides just raising interest rates in

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<v Speaker 1>order to overcome the inflation, and Nancy a lot of

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<v Speaker 1>it as well about the forward guidance about what they're

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<v Speaker 1>going to do after this meeting. How do you read

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<v Speaker 1>the overall health of the consumer when we had such

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<v Speaker 1>conflicting views from the likes of Walmart and then some

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<v Speaker 1>you know, better earnings coming through from the likes of Google,

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<v Speaker 1>Visa seeing spending jump to Yeah, I mean there's, like

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<v Speaker 1>I said, I think that all along with all of

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<v Speaker 1>the chaos and all of the bad news, corporate earnings

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<v Speaker 1>are are very strong, and corporate balance sheets are very strong.

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<v Speaker 1>And the reality is that these big tech companies they're

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<v Speaker 1>going to figure out how to skin this cat. They're

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<v Speaker 1>not just gonna play low and and take it. They're

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<v Speaker 1>going to figure out how to get around it and

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<v Speaker 1>and they're very resilient. And I always believed in corporate

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<v Speaker 1>America because they know, you know, every one of these

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<v Speaker 1>companies always figures out how to survive in times like these.

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<v Speaker 1>Investors are always trying to figure out how to get

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<v Speaker 1>an edge just buying. Let's say, all the cost averaging

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<v Speaker 1>and buying, you know, is fine, but I mean, where's

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<v Speaker 1>your edge here? For the listener? Now, what can he

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<v Speaker 1>or she do to get ahead? We'll trying to time

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<v Speaker 1>the market is a loosing battle, so it's really not

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<v Speaker 1>a good idea to even think about that. And there's

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<v Speaker 1>a lot of noise about oh, have we already hit

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<v Speaker 1>the bottom? And should we be? Is this a good

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<v Speaker 1>reentry point? Nancy down is Private Wealth Advisor and Amerprise

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<v Speaker 1>Financial joining us on the line on Daybreak Asia. We're

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<v Speaker 1>talking about opportunities you're seeing and you're not seeing any

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<v Speaker 1>outside the US at the moment, mainly due to the

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<v Speaker 1>strength of the currency. So the question is when do

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<v Speaker 1>we reach peak dollar and when to other markets start

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<v Speaker 1>to look attractive. Well, I think we still have a

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<v Speaker 1>little bit of a bumpy ride ahead. Um, Western Europe

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<v Speaker 1>has not recovered uh quite well yet. In fact, there's

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<v Speaker 1>the the Ukrainian Russian war is really taking a toll

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<v Speaker 1>on Western Europe and there's more problems there. But until

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<v Speaker 1>the dollar really shows some uh weakness, lesson where where

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<v Speaker 1>we are now. Uh, it's just too hard to overcome

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<v Speaker 1>the currency exchange rate. Even if companies begin to recover,

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<v Speaker 1>they would have to recover significantly before before we can

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<v Speaker 1>think about profit. It's and and big opportunity. So we

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<v Speaker 1>are in fact limiting our exposure outside the US at

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<v Speaker 1>this time. I think most investors know now that it

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<v Speaker 1>will be hard to get some commentary from the FED

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<v Speaker 1>until the job is basically achieved or done. So if

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<v Speaker 1>you're looking for early signs that inflation is topping and

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<v Speaker 1>that the FED might be able to ease back, what

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<v Speaker 1>are some of the early signs that you'd look to. Well,

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<v Speaker 1>you know, supply and demand is really the basic. Uh.

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<v Speaker 1>You know, when when demand is higher than the supply,

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<v Speaker 1>everything will will inflate. And that's just it's always been

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<v Speaker 1>the way it is. So once you start seeing the

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<v Speaker 1>supply become equal to or greater than the demand, that's

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<v Speaker 1>when inflation will begin to Well. The reason I ask

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<v Speaker 1>is like we've seen a pretty big move down in commodities. Now,

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<v Speaker 1>some might think that, you know, that's a pretty good

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<v Speaker 1>input into prices and that maybe that would be a key,

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<v Speaker 1>but then we haven't seen that with some of the

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<v Speaker 1>CPI data. Yes, commodities are going to start to taper off,

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<v Speaker 1>but I still I think there's still some upside there.

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<v Speaker 1>But really the big, big upside and commodities is behind

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<v Speaker 1>us at this point. So um, if we're not already out,

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<v Speaker 1>we should be getting out very shortly. But there's so

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<v Speaker 1>much opportunity out there. With all of the bad news,

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<v Speaker 1>there's also a lot of good things happening, so you

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<v Speaker 1>should be thinking about that. We'll tell us about some

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<v Speaker 1>of the good things in that you're looking at. In particularly,

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<v Speaker 1>I wanted to see whether or not you see still

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<v Speaker 1>value in sixty forty because the inflation is very much

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<v Speaker 1>continuing to weigh on one retencent. Well, you know, sixty

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<v Speaker 1>is really just a general cookie cutter kind of uh formula.

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<v Speaker 1>It's really more important to be more personalized and when

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<v Speaker 1>you're looking at investing, because even intent in bonds has

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<v Speaker 1>been pretty scary. It's one thing to expect volatility and

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<v Speaker 1>losses in stock, but it's really scary when your quote

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<v Speaker 1>unquote safe investments are down ten um, but even bonds

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<v Speaker 1>will be a great opportunity very shortly, within the next

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<v Speaker 1>five or six months because interest rates. Once there's the

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<v Speaker 1>long term rate reaches or or hits the three and

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<v Speaker 1>a half to close to four percent mark, there will

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<v Speaker 1>be a grand opportunity in long term bonds. Again, are

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<v Speaker 1>you seeing good values in credit? Um? You know that's

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<v Speaker 1>a little trickier. Uh, There's there's some avenue there, but

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<v Speaker 1>we're still thinking short duration and very very high credit. Nancy,

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<v Speaker 1>we talked about the FED, just I guess more broadly,

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<v Speaker 1>what are you expecting that we'll hear from j Peal

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<v Speaker 1>in terms of forward guidance. Wow, there's so much speculation

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<v Speaker 1>on that. You know, many are speculating half a point,

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<v Speaker 1>three quarters of point or even one percent. The reality

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<v Speaker 1>is it really doesn't matter because the markets already priced

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<v Speaker 1>it all in UM. And like I said earlier, it's

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<v Speaker 1>not only the raising of rates that's going to count.

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<v Speaker 1>There has to be some uh tightening of the money

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<v Speaker 1>supply before we can see some real difference. All right, Nancy,

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<v Speaker 1>thank you for your inside. Nancy Doubt is private wealth

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<v Speaker 1>advisor at a Mary Price Financial joining us on daybreak.

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<v Speaker 1>Asia