SO LET'S TURN BACK TO THE MAJOR
INDEXES AS WE SAID AT A PARTY
BUT THEN BEHIND AS JOINING ME
REMOTELY AND DAVID WAGNER
PORTFOLIO MANAGER AND EQUITY
ANALYST AT THE CAPITAL ADVISORS
DAVID THANK YOU SO MUCH FOR
JOINING TODAY WAS
TODAY JUST.
>> A BREEDER FOR INVESTORS AND
THE NASDAQ STILL CLOSING AT A
RECORD HIGH. BUT AFTER A STRONG
START TO
THE WEEK. IF YOU THINK IT WAS
JUST
♪
KIND OF AT A CHANCE FOR
INVESTORS TO RESET TODAY.
>> WELL FIRST OF ALL THANK YOU
VERY MUCH FOR HAVING ME BACK
ON THE SHOW AND TO ALL OF THE
DAY IS A LARGE A 3,000 YOU KNOW
I CAN SIT IN THIS CHAIR MYSELF
THAT THERE WAS THAT GEORGE
STRAIT IN THE BACKGROUND BUT
YOU KNOW REALLY NOW KIND OF
UNDERNEATH THE HOOD OF THE F P
504 STORY
14 POINTS. OFF THE
ALL-TIME HIGH AT ABOUT 33 BASIS
POINTS RIGHT NOW SO TODAY
SAYING SOMEWHAT MORE OF A
BREATHER AS A WHOLE BUT
YOU KNOW UNDERNEATH THE HOOD WE
DID SEE KIND OF A BARBELL
APPROACH TO WHAT OUT BEFORE
VERSUS WHAT UNDERPERFORMED HE
SAW THE HIGHER VALUE TECH
STOCKS
PERFORM YOU MENTIONED TASSEL
EARLIER YOUR CROWDSTRIKE YOUR
BUT ON THE OTHER END OF THE
SPECTRUM YOU DEFINITELY SAW A
LOT OF THE MORE CYCLICAL
REOPENING PLAYS THAT HAVE
CONTINUED
THEIR RALLY MUCH SINCE NOVEMBER
NIGHT
♪
WE HAD VACCINE DAY WITH PFIZER
REALLY CONTINUE TO STRETCH
THEIR FOR PROPELLING THIS
MARKET HIGHER.
>> YOU KNOW IT'S FASCINATING
THAT THE 10 YEAR TREASURY YIELD
AT ONE POINT FOR A PURSE SAID,
AND I THINK THAT WE
HAVE NOTS NOT POINT THAT OUT
DAVID BECAUSE IT'S NOBLE ONE
THING IS FOR SURE RIGHT BONDS
THEY BE TELLING US DIFFERENT
STORIES, DIFFERING STORIES
BASED ON
THE DURATION OF THE BOND ABOUT
ONE THING IS FOR SURE WHEN THAT
10 YEAR TREASURY YIELD CALMS
DOWN. IT
DOES ALLOW. THE VALUABLE RICHLY
VALUED TECH NAMES TO RISE AND
SO THE NASDAQ BOOKING ANOTHER
RECORD HIGHS THE 10 YEAR
TREASURY YIELD SEEMS TO BE
STILL IN ITS LOWEST LEVEL IN
ABOUT 3 MONTHS WHAT IS THE BOND
MARKETS SIGNALING TO YOU.
>> WELL CAN SEE EXACTLY RIGHT
HERE THE BOND MARKET IN THE
EQUITY MARKETS ARE TELL YOU 2
DIFFERENT THINGS. HERE POINT
RIGHT NOW YOU KNOW WE'VE SEEN
THE
10 YEAR TREASURY, THE RANGE
DOWN FROM ONE SPOT FOR 3 TO
ABOUT ONE SPOT 7, 3, SINCE THE
BEGINNING OF THE
2ND QUARTER ON THE LOWER END OF
THAT SPECTRUM RIGHT NOW SO IT
IS VERY MUCH A FORCE SO FOR
BONDS
RIGHT NOW, BUT TO YOUR POINT
EQUITIES ARE VERY MUCH TELLING
YOU SOMETHING DIFFERENT THAN
THE TYPES OF STOCKS THAT WOULD
BE OUTPERFORMING IF THE IF
INTEREST RATES CONTINUE TO GO
WAR WOULD BE YOUR UTILITIES,
YOU'RE STAPLES AND FOR
THE MOST PARK OUTSIDE TODAY,
YOU'RE HIGHLY VALUED TECH BUT
THEY HAVE NOT BEEN LEADING THE
MARKET THE CYCLICAL NAMES HAVE
REALLY BEEN LEADING THIS MARKET
HIGHER THE MORE INFLATIONARY
BASE METALS
AND MINERS.
>> AS IF THEY'RE ACTING AS IF
THE TO 10 GOING MUCH HIGHER
RIGHT NOW SO THE BOND MARKET IN
THE EQUITY MARKET ARE TELLING
YOU 2 DIFFERENT THINGS AND THE
POINT
BEING IT THEY BOTH CAN'T BE
RIGHT AND TO BE FULLY HONEST
THE BOND PEOPLE TEND TO BE THE
SMART PEOPLE BUT I'M ACTUALLY
SIDE WITH THE EQUITY PEOPLE
HERE RIGHT NOW THAT I THINK
THAT ONCE WE GET SOME TYPE OF
MORE
TAPERING ANNOUNCEMENT.
>> FROM JEROME POWELL THAT
WE'RE GOING TO CONTINUE TO SEE
THE MARKET BE RIGHT FOR
POINTING MORE INFLATIONARY MORE
CYCLICAL NAMES HIGHER HERE.
>> THIS THIS CAPER WE'RE RIGHT
BACK ON THE RISE IN WHAT IS THE
TAPER MEAN IT'S WHEN WE START
TO
SEE THAT AND SCALE BACK ITS
MONTHLY BOND PURCHASES BY 10'S
OF BILLIONS OF DOLLARS
COLLECTIVELY MORE THAN A
100 BILLION DOLLARS A MONTH IN
BOTH MORTGAGE AND TREASURY
BONDS WHEN THAT STARTS TO
LESSEN AND WE THE THE TAPER
THAT'S WHAT THE PAPER IS SHOULD
YOU BE IN BONDS OR SHOULD YOU
BE IN EQUITIES.
>> YEAH THAT'S A GREAT POINT
AND I THINK THIS IS ONE THING I
CAN SAY I'M CERTAIN I
REFERENCED OR STRAIGHT EARLIER
HERE THE SONG CALLED WRITE THIS
DOWN AND SO INVESTORS RACES
DOWN I WOULD NOT OWN
TRADITIONAL FIXED INCOME THAT
WE GET SOME TYPE OF
TAPERING NIGHT. YOU SEE REAL
RATE RIGHT NOW THE 10 YEAR
ABOUT NEGATIVE AD BAY THE POINT
AND WE'RE GETTING
A PLAYBOOK BACK IN 2013 WHEN
THE FED UNDER JANET YELLEN 32
NOW SOME TYPE OF SAVORY AND WE
SELL REAL RATES UNDER THE
10 YEAR TREASURY RISE FROM
NEGATIVE 80 BASIS POINTS TO
ABOUT POSITIVE 60 BASIS POINTS
IN THE SPAN OF
5 MONTHS. SO RIGHT NOW GIVEN
THE PAS AND INTEREST RATE YOU
KNOW YOU KIND OF GETTING IN
MONOPOLY TURNS THEY GET OUT OF
JAIL FREE PART OF OWNING
TRADITIONAL INCOME SO RIGHT NOW
IF WE GET SOME TYPE OF TAPERING
TOP PEOPLE IN
AND OUT I'D BE ALL OVER ANY
TYPES OF EQUITY IS IS MY
OPPORTUNITY TO OWN EQUITIES AND
FIXED INCOME. I WOULD STAY AS
FAR AWAY FROM POSSIBLE FROM
FIXED INCOME.
>> AND ENERGIES HAD A REALLY
STRONG RUN SINCE THE
PRESIDENTIAL ELECTION AT TO BE
HONEST. I'M NOT SO SURE WHAT
YOU ALL A TRIBUTE THAT TO MAYBE
WAS PARTLY THE ELECTION MAYBE
IT WAS PARTLY.
THEY REOPEN AT SOME POINT
INSIGHT ONCE WE GOT TO NOVEMBER
DAVID WHAT DO YOU THINK THAT
THESE ENERGY STAGGS
STILL HAVE LIGHTS WE FOCUS SO
MUCH ON RENEWABLE ENERGY
CLIMATE CHANGE NEW TECHNOLOGIES
THE TECHNOLOGY FOR INSTANCE
OUTPERFORMING TODAY THERE'S
BEEN A
♪
SO MUCH DISCUSSION ABOUT ENERGY
AND WONDERING WHERE YOU COME
DOWN ON THAT SECTOR.
>> YEAH YOU'RE RIGHT,
IT'S REALLY WHAT WE'VE FROM
TRADITIONAL ENERGY VERSUS CLEAN
ENERGY ON
WHAT IS OUTPERFORMED ESPECIALLY
GIVEN THE CURRENT REGIME
EVERYONE DOES ASSUME THAT
PRESIDENT BIDEN WOULD BE MORE
CLEAN
ENERGY FOCUS BUT ALSO IN THOSE
STOCKS HIGHER BASICALLY
PRESSURING PLAN ON COMING ON 5,
YOU KNOW TRADITIONAL ENERGY
LOWER SO WE KNEW IT WAS
ACTUALLY HAD A CONTRARIAN VIEW
THAT WE ARE ACTUALLY LONG AND
OVERWEIGHT ENERGY
RIGHT NOW AND WHY IS THAT WE'LL
TELL SHUNS RIGHT NOW FOR YOUR
NORMAL IN IT WAS VERY
LITTLE HISTORIC
WE SPEAK SO TO GET SOME TYPE OF
LONG RUNWAY FOR GROWTH THAT
THESE GUYS WE WOULD WANT SOME
TYPE OF MULTIPLE EXPANSION
AND SINCE THESE ENERGY
COMPANIES ARE VERY CHEAP ONE
UPPER PAUL THERE ARE MULTIPLE
TO CONTINUE
TO GROW. WELL MANAGEMENT TEAMS
RIGHT NOW KIND OF TAKING A
DIFFERENT APPROACH ENERGY
MANAGEMENT TEAMS TAKING A
DIFFERENT APPROACH ON HOW KIND
OF GOING TO GET FROM THE
CAPITAL ALLOCATION POLICY
HISTORICALLY I ENERGY
COMPANIES WOULD ON AVERAGE BUT
ABOUT A 125% OF THEIR FREE CASH
FLOW BACK INTO
THE GROUND WE'RE GETTING AND IT
SEEMS RIGHT NOW LIKE EXXONMOBIL
HIGH AND THEY'RE REALLY COMING
OUT
SAYING HEY WE ARE ONLY GOING TO
PUT ABOUT 50% OF FREE CASH FLOW
BACK INTO THE GROUND AND THE
REMAINING 50%. WE'RE GOING TO
GO BACK TO SHAREHOLDERS THROUGH
DIVIDENDS UP SHARE REPURCHASES
AND IF YOU LOOK AT FROM A
PLAYBOOK
INDUSTRIES THAT HAVE KIND OF
TAKEN THIS CAPITAL ALLOCATION
POLICY YOU KNOW LOOK AT
AIRLINES LOOK
AT RESTAURANTS. EVEN RAILROADS
YOU KNOW THEY SUSPEND ALL THE
MONEY THAT THEY COULD DO WHAT
THEY SHOULD HAVE FOCUSED IN ON
CAPITAL ALLOCATION OF PUTTING
THE SHAREHOLDER FIRST
BY RETURNING DIVIDENDS TO THEM
IT'S VERY PRETTY START TO SEE
THOSE INDUSTRIES REALLY START
TO OUTPERFORM SO GOOD IN THAT
TAPE ABOUT CAPITAL ALLOCATION
POLICY THAT WE'RE EXPECTING IN
THE FUTURE FROM ENERGY ENERGY
MANAGEMENT COMPANY. WE EXPECT
THEIR VALUATION
♪
TO EXPAND.
>> DAVID I WISH WE HAD MORE
TIME I WANTED TO TALK ABOUT
MEANS DAD TONIGHT PRODUCER
TELLS ME YOU'RE NOT THE BIGGEST
MEANS THAT BAD BUT MAYBE WE CAN
GET YOU BACK AND WE'LL TALK