>> WELCOME BACK TO CHEDDAR
NEWS, EVERYONE, I'M KRISTEN
SCHOLER ROUGH WEEK FOR THE
MARKETS, DEFINITELY THE DOW THE
DOW BOOKING ITS WORST WEEK
SINCE OCTOBER THE LAST TIME WE
SAW ANY REAL SIGNIFICANT
PULLBACK HERE THE NASDAQ DOWN 9
TENTHS OF A PERCENT THE S AND P
500 DOWN 1.3%. MARKETS ENDING
THE DAY
AT SESSION LOWS. WELL JOINING
ME NOW IS PHILIP THAT CEO AND
PRESIDENT OF LAUTENBERG
THALMANN ASSET MANAGEMENT AT
PHILIP IT'S GOOD TO HAVE YOU
WITH US THIS AFTERNOON, HAVING
ME WE DID SELL OFF INTO THE
CLOTHES, I'M TAKING I'VE BEEN
WATCHING
BODY OLD ALL DAY LONG THE
MARKET IS SIGNALING BUT
INVESTORS ARE SIGNALING THIS IS
NOT AN INFLATION STORY, THEY'RE
NOT WORRIED
ABOUT INFLATION. THAT YOUR
DRONE PILOT AMBER, THOSE
CONCERNS LUMBER PRICES THAT
COME DOWN SOME OF THE SUPPLY
CHAIN CONSTRAINTS
ARE EASING. BUT THAT PROSPECT
OF HIGHER RATES DOES SEEM TO BE
SENDING THE MARKETS
LOWER TODAY.
>> WHAT'S YOUR TAKE ON THE
MARKETS GOT A RIDE OF NEVER BE
THE FED HAS PAINTED THEMSELVES
INTO
A CORNER. YOU'RE LOOKING AT A
SITUATION WHEN YOU WATCH WE
JUST TAKE I ARE VERY STICKY
RENT STICKING. I ARE VERY
STICKY, CERTAIN ASPECTS OF THE
IN PLACE RECYCLE RUNNER GOING
TO STAY HIGHER AND HIGHER A
LONG TIME LUMBER WENT UP 2000%
BUT STILL GOING TO SETTLE UP A
COUPLE 100 SEMINOLE SAID IN
THAT MEETING THE FED IS GOING
TO HAVE NO CHOICE BUT TO STOP
BUYING BONDS IN THE FALL
AND I REALLY SINCERELY BELIEVE
WE'RE LOOKING AT A CORRECTION
HERE IN THE NEXT 6, 8, WEEKS OF
10 TO 15% BECAUSE HIGHER YIELDS
ARE GOOD FOR STOCKS.
THAT MEANS ECONOMY IS INFLATING
BUT THE SHOCK OF HIGHER RATES
IS GOING TO STOOP TO MARKET
INITIALLY THE BUYING
OPPORTUNITY GET READY FOR SOME
SERIOUS VOLATILITY.
>> SO A LOT OF PEOPLE HAVE SAID
AS WE TRY TO NAVIGATE THIS
SUMMER AND THIS MARKET 6 TO 8
WEEKS DOES FALL IN THE SUMMER
TECHNICALLY, IT'S BEFORE THAT
LABOR DAY HOLIDAY BUT A LOT OF
PEOPLE HAVE SAID YOU KNOW MIGHT
BE KIND OF A DULL
SUMMER, IT'S STOCKS GENERALLY
AT TEND TO MOVE THEIR RANGE THE
SELL IN MAY AND GO AWAY TO
REWRITE THE PEOPLE BASICALLY
TAKE THE SUMMER OFF AND THEN
THEY COME BACK INTO THE STOCK
MARKET AFTER THAT LABOR
DAY HOLIDAY. THIS MESSAGE.
THEY ARE SENDING TO INVESTORS.
IT SOUNDS LIKE NO WE COULD SEE
SOME ACTION THIS SUMMER IS
THAT RIGHT.
>> YEAH VERY DIFFERENT BECAUSE
YOU'VE GOT STRUCTURAL IMBALANCE
IN THE LABOR MARKET, THE WEEKLY
JOBLESS CLAIMS WENT UP NOT
SUPPOSED TO DO THAT THAT'S WHAT
THE BOND MARKET SOLD OFF TODAY
AND ACTUALLY
WENT DOWN REFLECTING THAT MAYBE
WE'RE NOT AS OPEN AS WE
THOUGHT, BUT YET WE'VE GOT
THESE UNUSUAL THINGS UP IN
WHERE
INFLATION SPIKES GET THE JOB
MARKET HAS RECOVERED IF THE JOB
MARKET BE INTO FULLY RECOVERED
PUTTING MORE PRESSURE ON THE
FED. I'M I'M CONVINCED THAT IT
WILL AS THIS THING WAS WHITE
WIND DOWN HERE AND AND KOBE
GOES AWAY THAT MUCH MORE THEN
YOU COUPLE ON A
FED BEING STARTING TO SIGNAL
THAT THEY'RE GOING TO RAISE
RATES WE'RE GOING TO GET A
NASTY FROM IT WILL BE A SHOCK
TO THE MARKET AND YOU'RE
LOOKING AT A FED FUNDS RATE
RISE NEXT YEAR
IN THE 4TH QUARTER OR EARLY
2023. AND I ACTUALLY THINK NEXT
YEAR IS OPEN EVERY DAY I WOULD
TELL INVESTORS YOUR CHANCE TO
ROTATE TOWARDS MORE VALUE
TO GROW SHORTEN THE DURATION OF
YOUR BONDS TO SHORTER VAN ROTEN
LONGER RAISE A LITTLE CASH
YOU CAN AND ENJOYED ABOUT THE
OPPORTUNITY TO BUY THE DIP
BECAUSE OF WESTPORT THE YEAR
SHOULD BE VERY STRONG WITH ALL
THIS YOU FOR GOT IT GOING TO
HAPPEN TO CONSUMER SPENDING
OVER
THE SUMMER.
>> THERE ARE SO MANY WATERS TO
NAVIGATE HERE STILL FEEL LIKE
I'M GLAD THAT YOU BROUGHT
UP THAT THE TAPER RATE THE TAPE
OR TECHNICALLY IS NOT RAISING
RATES TO TAPER REALLY
IS MORE FEELING BACK THESE BOND
PURCHASES MORE THAN I THINK A
100 BILLION DOLLARS IN BOND
PURCHASE THAT WE SEE ON A
MONTHLY
BASIS BETWEEN A TREASURY BONDS
AND MORTGAGE BONDS THAT THE
FED IS STILL IN BARKING ON AND
IT SOUNDS LIKE WE'VE HEARD FROM
THE FED THEY'RE GOING TO DO
THAT FIRST STEP BEFORE THEY
ACTUALLY RAISE INTEREST RATES
WHAT DOES THAT MEAN TO THE
MARKET AND OFFICIAL TAPER.
NO LONGER BUYING THE BONDS TO
THE SAME EXTENT THAT THEY ARE
LET'S TALK ABOUT THAT FIRST AS
WE KNOW WE'LL GET THAT FIRST
BEFORE WE GET HIGHER RATES.
>> ALI NOTHING ALREADY STARTED
MAYBE EARLY ON YOU MIGHT
REMEMBER THAT WHAT ETS OF
CORPORATE BONDS THEY ALREADY
STARTED SELLING THOSE OFF
WASN'T A LOT
ABOUT 15 MILLION DOLLARS BUT
THAT TAPER ME THAT THE
FEDERAL JUDGE THERE IS NO
LONGER GOING TO BE SUPPRESSING
INTEREST RATES ARTIFICIALLY
DOWN BECAUSE THE BUYER OF
PRIMARY RESORT. SO THAT MEANS
THE BOND MARKET
CAN ELEVATE HIGHER WITHOUT THE
FED COMING IN TO BUY MONTH THIS
PRESS RATE THAT MEANS THAT THE
BEGINNING OF THE END OF THE FED
OR WAS RESERVE INVOLVEMENT IN
THE ECONOMY. WE'LL HAVE STARTED
AND THAT'S THE SHOT WELL, IT'S
NOT A TERRIBLE THING ECONOMY IS
EXPANDING INFLATION. YOU IS
GOOD FOR STOCKS AND BAD FOR
BONDS AS YOU ARE COMMITTING A
MINUTE AGO ABOUT THE BARENTS IN
INTEREST RATES SO THAT MEANS
YOU'VE GOT TO BE IN STOCKS BUT
THE INITIAL SHOCK OF IT TAKING
AWAY THE PUNCH BOWL FROM
THE PARTY MEANS ARE GOING TO
SEE A WAVE OF 5 TO 10%
CORRECTION A BRUSH FIRE THEIR
NORMAL BY THE WAY THEY HAPPENED
THAT
SHOULD HAPPEN AND NOT YOUR
OPPORTUNITY TO GROW LONG AND
STRONG INTO THE EQUITY MARKET
TAKE ADVANTAGE GET SOME BROUGHT
OUT
OF IT. BUT IT'S GOOD START WHEN
THE FED WHEN THE FED OR THEIR
COUSIN SAYS OKAY WE'RE GOING TO
SLOW DOWN OUR BOND BUYING IN
SEPTEMBER AND THAT ANNOUNCEMENT
PROBABLY AND ON.
>> OKAY SO THAT'S WHAT YOU
THINK THE CORRECTION COMES I
WAS WONDERING IF IT SOUNDED
LIKE PERHAPS YOU KNOW IT COULD
BE MONTHS IT COULD BE UNTIL
SEPTEMBER THAT WE ACTUALLY SEE
THE JOBS MARKET REALLY
IMPROVED TO THE RATE THAT
ECONOMISTS EXPECT FOR 2
STRAIGHT MONTHS NOW WE'VE SEEN
THE JOBS NUMBERS OF MISS THE
DOT THE JOBS ADDITIONS MISS ON
A MONTHLY BASIS BOTH
IN APRIL AND IN MAY AND THEN WE
DID GET
THAT SURPRISING. AND DATA POINT
THAT WAS MOVING IN THE WRONG
DIRECTION. YESTERDAY WHEN
JOBLESS CLAIMS. I DID ACTUALLY
RISE TO THAT'S WHAT I WANTED TO
CLARIFY YOU THINK THAT THE
SELLOFF IS GOING TO BECAUSE THE
JOBS GAMES
OR NOT KEEPING UP WITH
ECONOMISTS EXPECTATIONS KNOWING
THAT THAT FEDERAL UNEMPLOYMENT
BENEFIT TECHNICALLY DOES AS
STILL AND IN SEPTEMBER EVEN
THOUGH MANY STATES ARE DOING
AWAY WITH IT THAT OR THE TAPER
ANNOUNCEMENT.
>> IT'S THE JOBS MARKET
IMPROVING STEADILY THROUGH THE
SUMMER THAT PUSHES THEM TO
BEGIN TO TAPER THEIR MEMBER
THEIR MAN DIDN'T GET THEM TO
MARKET I REALLY WANT
TO BE AND IF WE GET UP WHEN WE
START TO ADD
500 BILLION 1 MILLION DUBBED
THE MUCH LIKE POINT DESPITE
HAVING IN AUGUST AND SEPTEMBER.
THEN THE PRESSURE ON THE FED
WILL BE IMMENSE AND THEY ARE
SINGLING THAT IN AUGUST WHEN
THEY SEE THAT STRONGER DATA
THINK OF THIS AS AN AD TIME NOT
HIGH TIDE AT THE BEACH OR LOW
SIDE YOU'RE KIND OF IN BETWEEN
WHERE A BIG WAVE COME ONCE IN A
WHILE THAT'S WHAT'S GOING TO
HAPPEN REALLY UNUSUAL MOMENTS
IN THE NEXT 6,
8 WEEKS HERE. DATA THAT'S GOING
TO SURPRISE TO THE UPSIDE AND
THAT'S WHAT'S GOING ON
PRESSURE ON THE FED THAT'S
WHAT'S GOING TO MAKE THEM START
TALKING ABOUT TAPERING AND
THAT'S WHEN THEY FINALLY BEGIN
TO REDUCE THEIR BOND BUYING AND
SAY THAT THE LATEST I THINK
OCTOBER MAYBE NOVEMBER, BUT
THAT SHOCK OF THE ANNOUNCEMENT
THAT YOU'RE GOING TO THE
MARKET.