The Capitalist Investor - Episode 112

It’s hard to get away from politics; it’s within our music, media, sports, money –– politics drives everything. From Neil Young’s crusade against Spotify and Joe Rogan to Joe Biden’s pointless remarks on reporters, Derek and Luke reveal that there’s no shortage of political discourse that makes us reflect on the world we live in. And the world we live in is not the same anymore, politically or financially. Last week, we saw an unbelievable swing in the market. Right now, the market is just so volatile and we have to accept this new normal of volatility. Episode #112 of “The Capitalist Investor,” asks the question “what’s changed?” and Derek and Luke deliver to answer that.

Outline of this Episode:

  • [2:05] Neil Young’s attempt at cancel culture
  • [7:20] A short praise for John Madden and his impacts
  • [8:30] High Volatility is here to stay for a bit, be patient
  • [16:15] Joe Biden’s testy remarks on a fair question

If cancel culture continues, will there be anyone left?

Last week, Neil Young threatened Spotify to pull his music off in objection to Joe Rogan’s podcast. While Young disagrees with much of Rogan’s views and what he says on his own show, it seems that today’s solution to that is to cancel whoever you disagree with. While we can’t escape politics, is the current world we’re living in, down a scary path? It’s an unfortunate part of our society today that we live in such a divided world. Will we be able to come together again and just formally disagree?

There are so many moving pieces in the market, high volatility may be the new normal

On January 24th, the S&P 500 slid as much as four percent earlier in the day, before rebounding to finish in the green –– a whirl of a surprise.

Our main takeaways of this type of volatility are both realistic and optimistic. First, there’s no doubt that the market is volatile; there is a lot of uncertainty out there and the market is displaying just that. It’s being tugged in different directions, reacting to the Fed’s response to raising interest rates, earnings changes and even what we’re seeing in Ukraine. There are so many moving pieces and it’s trying to decide which direction to go.

Second, on a more optimistic side, stocks were bought back. There’s strong demand still out there and people are willing to buy the dip. History says buy the dip and we too, stand by that.

This highly volatile environment may just be the norm. It seems like it’s here to stay. Our advice is: expect that. Don’t try to time the market, it’s a new nature now. Be patient. Of course that’s easy to say if you don’t have money on the line but we know what that’s like. Just think deeper and dig deeper. Now, earnings expectations aren’t as high going in, the bar is much lower which makes successes seem closer.

Doocy’s question was valid –– inflation is a major liability

Inflation is a hindrance. It’s an obstacle. It’s something on our minds all the time and we have to talk about it in order to work through it. So, when the president scoffs off a question about inflation, that raises a little bit of concerns on our end.

During a news conference last week, Fox News correspondent Peter Doocy asked Biden if he thought inflation was a political liability going into the midterm elections. The president’s mic was hot and he responded testily and with profanity towards the reporter.

The question was valid and yet, the president went out of his way to make a reporter look foolish, without even offering an explanation on why that was a thoughtless question. We’re not really sure if Biden understands inflation or any sort of economic principle, we would like to hope so. But it doesn’t seem like this administration really has a handle on the inflation crisis. Politics in general, no matter what side it’s on, doesn’t seem to be going in any sort of feasible direction. It’s just becoming a larger and larger body of people – and not one that can improve larger issues, at least.

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Keep Listening to The Capitalist Investor:
Episode 15:
Spending Strategies in a Bear Market, Ep #15
Episode 31:
Handicapping the 2020 Election, Ep #31
Episode 47:
11 Investments in Your Home That Pay Off, Ep #47
Episode 63:
Jeff Bezos and Amazon: Past, Present, and Future Ep #63
Episode 79:
7 Ways Biden Plans to Tax American Families (Part II), Ep #79
Episode 95:
5 Beaten Down Stocks to Buy on the Dip, Ep #95
Episode 111:
Special Episode – Talking Energy with Daniel Turner, Ep. #111
Episode 127:
Retail Earnings Tank & What The Heck is Greenflation? Ep. #127