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STOCK MARKET TALK … Get Ready for $MELI earnings with Krane Shares
Recorded: Feb. 23, 2026 Duration: 2:42:12Space Recording
Short Summary
Mercado Libre is poised for significant growth as it expands its fintech services in Mexico and anticipates over 60% growth in Argentina. The company is navigating a rapidly evolving e-commerce landscape in Latin America, capitalizing on increasing consumer demand and securing funding for its initiatives.
Full Transcription
What is up?
What is up, everybody?
How are you all doing we'll give us a second to get started here maybe i gotta close a tab or two on my computer as well but i hope you are all doing fantastic
we should have a great spaces today we should be having hopefully scott redler joining us
in this first hour we should be having there is scott we should be having dan n we should be having hopefully scott redler joining us in this first hour we should
be having there is scott we should be having dan niles should be joining us in the second hour
and i am very much looking forward to this we might have a new stock talk pick uh there was
a name in there that i didn't really recognize too much so uh this should be a jam-packed spaces
on top of that on top of those two awesome speakers,
on top of a new stock pick,
there are even some earnings as well.
There's a HIMSS earnings after the close.
There is also a Kratos earnings after the close.
Scott, I don't know if these are ones you trade at all or watch too much, but I'm sure people in your group
are excited about HIMSS.
It's a social media favorite.
How are you doing, sir?
I appreciate you joining us.
Yeah, well, let me just say hello first.
I actually just got into my office.
I'm in New Jersey, Short Hills, and we got about 20 inches of snow.
So I did get up.
I canceled the 25-20 because I couldn't get my guy to come stream me from the sauna doing my workout.
But I thought I would get in for the 630 Club, and then I made it to 7 o'clock club and then I said
you know what I'm not coming in it was too dark and miserable out and I didn't even you know if
I even got out I didn't even know what the roads were doing on my way to the short hills office I
could even park in the parking lot that would then get plowed so I traded remote all as well though
I will say you know you know this this this type of action is definitely a little concerning.
You know, there's so much fear out there just in so many different sectors, but then you still have the spies sitting here at 681.
It kind of feels to me like it's finally going to break because nobody wants to press here anymore.
But, you know, that hasn't been the right trade.
You know, last week we talked about how Microsoft put a floor in at 392.
What kind of bounce could it have?
And did a broken bounce and broke 392 to give some clues to get out of tech today.
Some guys made money shorting that.
IGV, which everyone's been trying to play a low in, gave you a little floor to trade against.
If you guys were doing it at 79 and then broke that.
So all of a sudden, software got another round of selling, which brought the market down. But we're still it at 79 and then broke that so all of a sudden software got another round of selling which brought the market down but we're still in the range so it's like you know every
time they rally us back to um you know to the mid-level to the upper level then these things
break i feel like it'd be nice if something happens and we could break this bottom end of
the range and just do a clean out already but hasn't happened um so software again you know a lot of people are
talking some people are still making money short there some people getting their asses kicked
trying to uh but you know catch a falling knife you can try things but you got to make sure that
once they break you get out of the way i think some guys got caught in ibm they thought that
down move was over and now it's down another ten and a half percent so there's a you know there's some some some big cap names in tech not just like you know super growth that are
getting really beat up now you know or have been getting beat up it's one thing you get an oak low
to go getting cut in half or some of these like stocks that trade on revenues and you know 100
pe you know people are used to that but when you get a stock like Microsoft, that just continues lower, or service now continues lower, or, you know, CRM or, or,
or Oracle, you know, many Oracle has been coming down for seven months. It's funny,
I listen to Donald's on TV, like, Oh, Oracle reinvented, had a great move. I'm like,
it had one move up, and then it's been churning down since but anyway um so with that said um you know the
681 is a spot in the spies and then if it doesn't hold here into the close we could see 675 which
is the real real real upper uh channel that's going to be very important to figure out whether
or not we you know we continue to hold the range and then and then finally you know get going a
little bit or the range breaks and these annihilated stocks get annihilated further and then create a different type of trading.
You made me – I apologize for interrupting.
You made me look at NVIDIA stock.
They're now down 20% so far this year.
Yeah.
Oh, sorry.
Sorry.
Sorry.
Wait, wait.
Microsoft.
Microsoft.
NVIDIA earnings week on the mind. I guess we just said it by. Wait, wait, wait. Microsoft. Microsoft. NVIDIA week, earnings week on the mind.
I guess we just said it by accident, but it was Microsoft.
Continue.
No, well, it's just Microsoft, totally different.
Microsoft did that double top at like at 550.
It could do no wrong, and then it could do no right since.
NVIDIA, like everyone just keeps talking about the AI bubble,
the AI bubble, making it seem like NVIDIA is going parabolic.
But meanwhile, NVIDIA is in the same exact spot it was last quarter,
the same spot.
And if you look five quarters ago, it's in the same spot.
So yes, NVIDIA's had a big run in like the last four years.
But if you've been trying to play NVIDIA more than just a range,
it's at 190-46 where it was last quarter.
So it'll be interesting to see what they do with NVIDIA post-enesday into thursday it will be the nil that you know that slams the coffin
shut and we break the ranges and we get some you know real downside action across the board or
you know we're still in the range and nvidia finally you know caps up and holds it and
and and starts a more um a move that has sustainability versus just the range.
So there's still a lot going on here.
I just feel like I just keep telling my traders less is more, less is more, less is more.
It's, you know, take some trades, trade in each end of the range.
Don't expect much more.
You know, prices are key and stops are key.
But, yes.
I mean, it's my pay help. I'm showing myself out, too. I mean, this might help.
I'm showing myself out, too.
I don't think NVIDIA is going to matter.
I'll give you my thesis why.
I mean, there's no way they don't beat and guide up
based upon everything we see that's going on out there.
All these massive companies like Microsoft and Meta
and Google and Amazon and all their additional spending,
I wonder if it actually is going to matter this time.
I agree with you, but does anybody not think they're going to beat and guide up?
And plus, they have zero China revenue forecast, and they look like they're getting some now.
I just don't know what's going to move that name.
I don't know.
I guess it is a source of funds.
I get it.
I feel like just when people say it's just not going to matter, it usually matters.
You know that.
I remember last quarter when it got –
Great point.
I remember last quarter when it gapped up and it failed that day.
My friends that are shorts, you know, they made their biggest day
because it opened up, it failed,
and that's what started the down move on the last quarter.
I'm just – you know, for me, I guess I'm just –
it seems like a decent setup to try and be long.
I did buy the 195 calls last week when the stock was closer to 186 and I've got to sell a third of them.
You know, this morning was up near 193.
I've learned my lesson.
I have to take some trades.
I'm going to hold some through just in case.
And to me, I'd almost rather than be down 20 points, lose my money on the options and break this range and get a whole new trading environment.
Because this trading environment, although you can make money picking spots, has not been great for swing traders unless you're a good swing short.
And unless you keep leaning on the stocks that you think can't go lower and there's not that many stocks like a sand disc, that feels like it could change at any moment also.
So for me know the last month
or two has not been that much fun i know the mid cap guys that are picking stocks like you know a
lot of guys on here which could speak probably better than me you've caught all these awesome
you know small caps mid caps bios for me who trades i guess more of the the big names that
everyone trades those those besides the sand disc have not been very rewarding if you
stay for more than a day and a quarter or day and a half. I think, you know, just to add on to that,
whenever we do these spaces, I'm always thinking of the 500 plus people that are listening to us
because, you know, you can have us all talk to each other and we've been trading for a long time
and we have a lot of different ways,
a lot of different levers to pull.
But I'm always thinking about the people
are listening to us and what maybe they need to hear.
And so for me, my perspective on this market right now
is there's two things you would be doing in this market.
One is you're either trying to catch falling knives.
And I think that's a very low probability option.
Or you're slowly maybe
adding to some long-term positions. I don't mean trades. I mean like long-term positions that you
think are oversold. This morning, I came in, I sold some Oxy calls I had that were up. I sold
some puts in bros, which is a name I'd like to get into
eventually. I think it's oversold, but I'm not ready to buy it outright, but I sold some puts
so that if it rallies, I'll get the premium. And if it doesn't, I'll get a better cost basis.
And then I went on a hike. Can I say one thing on that?
Well, sure. As long as you let me talk after that.
I promise I will. I'm just saying like, I have a lot of friends that have
a decent sized account and that's what's been working for them too.
Like these oversold names, they're not buying the stock.
They're going out two weeks and they're selling puts to collect.
So this way they don't have to be as perfect.
They want in any way there.
So instead of buying and having to be perfect, they'll go out and sell puts maybe like seven to 10 days out or you could even do more than that lower.
And that's a good
way on names you want, you want to accumulate. If you have that kind of leverage, just wanted to
say that that's working for a lot of, you know, not for a lot of people, for smart people like
you and some of these guys, you know, that have the leverage and buying power. Well, you'll have
to ask my wife how smart I am because she would argue, but, but if you have, and if you have a
longer timeframe, like I'm talking
like you have timeframes of months and years, it's even a better strategy because you don't have to
get it exactly perfect and you're going to be bringing your cost basis down. But I did those
moves in the morning and then I went on a hike, right? And I know people think like, wait, you're
a trader. You should be at your desk. Like I'm a trader when the odds are most in my favor. And I don't feel like this
market is a market where the odds are in my favor. I feel like if I had to do the ratio of work to
profit, it's way out of whack right now. I'd have to do so much work. I'd have to be so on every
tick for just a little bit of profit. So fortunately, I live in Southern California where
it's not snowed in, so I could go for a hike. I went for a hike. I came back after two and a half hours,
and guess what? I missed zero. So I guess what I'm trying to tell people out there is don't get
caught up in that narrative that you've got to be doing something. You've got to be doing something.
Unless this is your job, unless you're someone like Scott that gets paid, you know, quarterly
or monthly, and you need to hit certain numbers, I really think this is a sort of
market where you need to sit on your hands. I know it's frustrating. I know it seems like
stuff's going on. I know there's people on FinTwit that are telling you how they're killing it,
but trust me, they're not, right? The best plan, unless you're a super active trader,
is just to sit back. And the other thing I would do is maybe start getting a shopping list of things
that have held up pretty good that when the market does
stabilize, when we do find a floor and we start to move up whenever that is, those are the names
that are likely to be a little bit ahead of the crowd. I'll tell you one name that I think is
holding up pretty good right now is ONDS. It's green today. It's doing relatively good compared
to the rest of the market over the past few weeks.
I keep an eye on it. Does that mean you just go out and buy it? Absolutely not. But it's something
to keep an eye on because it's showing better relative strength. It could fall apart tomorrow,
but if it holds up until the market firms up and then it has a nice base you can trade against,
that's likely going to be one of the leaders in the next up uh a part of the market yeah i like
that's likely going to be one of the leaders in the next up part of the market.
i like going ds also i like you went from 15 back down to eight it's kind of in the middle of this
range no man's land around 10 20 which is fine you know you could probably do what you just said
with this one you could go out and sell nine dollar puts out a month from now gets it you own
it at eight and then you know if it starts trading better there's ways to add to that too in a better market but that definitely is one of the leaders of the drones
and i don't think that group's going away it's just going through a rebuild cycle right here with
umac and a few of the other ones but yeah like you said in a sea of red is when you see things
stop going down so this is when you could you know figure out which could go better when the market goes back up. But it's a complicated time because, again, the indices have not fallen down.
The S5 is not even 2% off highs.
Maybe it's 2.25.
Their stocks have been correcting, not the indices, even the Qs.
It's not down that much.
But I want to say one other thing to what you were saying because a lot of people are talking about that article over the weekend from Citrini, who wrote about 2028 and his bare case on what AI could do to the world.
You know, I've been doing this now for 30 years, and there's been lots of people who, you know, say this isn't going to end well, the world's not going to end well, and bunker down. It was a pretty
scary article. I read it, and I'm like, I shouldn't be reading this because it's not going to make me
money this week, this month, this quarter. But then it just had me realize more how longer term,
which some of you are also, you need to have different types of financial vehicles in place.
Like I talk about 53 at 35, it sucked to buy a whole life insurance
policy, a real one, not a term. But now I just looked at the cash value. And if I have to send
my son to Princeton, I can use my cash value from the whole life insurance policy. And it didn't
matter what the market did. But, you know, then you have, you know, 401k. If we've been up for
three years, double digits like we've been, if all of a sudden we do get a 10-month down move in the indices, it doesn't matter if you're 20, 25, 35, you have a 401k
where you're putting money in every month into different, hopefully S&P big cap funds.
That's what I do. I do S&P big cap and then I don't try to be too cute. Or you have a blood
in the street account. A lot of people love my blood in the street account that only starts going to work.
That when we're like 5%, 6% off highs and usually, you know, I could do three tiers.
And by that point, you know, the market heads back up.
Like last year, we went down 21% in the first quarter.
You know, here again, we're not even, I don't even think we're down three.
But, you know, don't get scared.
Is there a crypto blood on the streets portfolio?
I'm sorry. I just got a notification Bitcoin under 64K. Is there a crypto blood on the streets portfolio? I'm sorry.
I just got a notification.
Bitcoin under 64K.
Is that what they just sent me?
No, I do say Bitcoin is something like it's it's like a gold or a silver where if you do have that pie chart, you know, and you're an asset allocator.
When Bitcoin's like this, you can only put a certain amount every single month if you don't, if you're not getting paid to be right. But when Bitcoin is awesome and above the 821 day and like nine months ago,
yeah, you can make a lot of money trading Bitcoin and Ethereum and the others.
But that's trading. That's using momentum rules. And Bitcoin has been below that,
not only the 821 and the 50 day, it's below the 200 day. So it's not a trade unless you're just
picking spots. So this is what I would do with do with bitcoin bitcoin you still can't do anything or you're putting a few hundred dollars a month every single every single month as
as if you were doing the gld you do that with the with ibit but only do that with ethereum and and
bitcoin i'd rather you even just do bitcoin not ethereum and i do think it will be higher at some
point but right now it's just not a trade there's been times when gold and silver has been in
consolidation rebuild bear markets and obviously cryptos guys have seen this before you know with
with with with crypto and bitcoin and usually it's harsher and more severe than than any other
group that's why it's so profitable and people love it when they're right but for now
it's every balance has been sold and it's not a trade i've burned a bunch of money a few times i bought the ivit
calls probably four times in the last two months because risk is premium paid and lost money every
time i thought it hit a level you could do that too which is fine you know you can test levels
use options you know but you can't just accumulate accumulate accumulate if you know because who
knows when you get the real bottom and then a sustained move off that bottom with a higher low
and then it starts to get better.
It hasn't done that yet.
But it could be part of an asset allocation.
Small percentage, like 5% in Bitcoin every single month.
And at some point, it'll have a nice move.
I just don't know when that is and where from.
That's a Trini research piece.
And by the way, Scott, the reason we read this is so that our
subscribers don't have to you know so we can we can tell them about it but it's it's the second
bear porn opus that's been dropped in the last two weeks there was one about a week ago we can
half ago right that is going to kill everything and it's look it's it's a fundamental i'm not
going to get into the debate about what ai is going to do, what it's not going to do.
But I think it's a fundamental misunderstanding of a lot of things, number one being human nature.
But it also signals to me it feels a little too like, okay, we're getting to that point.
If you combine these bear porn drops with the actual drops in these software stocks, it feels like we're getting to the point where we're gonna
get a massive counter trend rally but it also felt like that to me two weeks ago and this is the
problem when you don't have a technical approach to the markets is you think well this seems like
too much and then you buy something like pan w and it keeps going down you buy adobe and it keeps
going down this is why I say this is a knife catching type of market there are people that
can catch knives I used to catch knives. I used to
catch knives when I was younger. I'm too old to do it now. It's just too much work, right?
You know, on that topic, I wish if like the S&P was down, I think the S&P was down 9% off the
highs and all this was going on to be like, we're definitely close to something. It's just so hard.
It's like the S&P is not even 3% off highs and you have these bear porn articles you have software getting crushed you have you have real companies like it just
causes that maybe the computers are trying to cause that disconnect where you don't catch the
counter trend rally or maybe we're doing a time consolidation in in the in the S&P cash and and
some of the indices while stocks correct and they hide somewhere. But like, I'd be so excited right
now if like, if the spies were 655 and all this was going on with, you know, like you said, bear
porn and, and Microsoft making lows, I'd be waiting for this bottom tail type day and waiting to put,
you know, so much of my buying power to work. But it's like, how do you, how do you try and catch a
low in the software sector that's been going down without the indices going down,
what happens if the indices play catch-up? Well, that's the big question, right? And as I sit here
as someone who's been doing this for decades, I'm trying to figure out what's going on, right?
Microsoft's 30% off its highs. Palo Alto's 36% off. Oracle's 60% off. Adobe's 65% off. And S&P's
down 2%. So I'm sitting there thinking to myself, okay,
what's going to happen? Are we going to continue downside momentum in these names,
and then there's going to be contagion, and we're going to pull the whole market down?
Or is it that, hey, the market has held up pretty goddamn good while all these names have cratered,
and now it's probably time for those things to have a big counter-trend rally?
I don't know which it is. I tend to lean towards the, we're probably going to have a big counter trend rally. I don't know which it is. I tend to lean
towards the, we're probably going to have a big counter trend rally, but when that happens,
nobody knows. And then if you mix into that, some other factors, like we're probably going to have
something going on in Iran. It's just, again, it's just, it's not a high percentage market right now.
And when I, again, I keep going back when I was young, I was young,
I would just be in every single market and I could never say no. And I would chase every move.
And it's just, it's too much. It's just way better to sit back, wait for those fat pitches.
You know, you don't get, you don't get any, if you make a hundred thousand dollars on a hundred
trades or you make a hundred thousand dollars on 10 trades, you don't get any bonus points.
You know, it's the same amount of of money but it's a lot less stress yeah and on that topic too you said two different case in points
so we were also just talking about uh safe sane and ready so when one of those scenarios show
their face a little bit more clear you're not a shelly yourself and you're able to press buttons and execute so during this time
period where the range is monotonous you have to stay sane safe and you know have a few paper cuts
and just be ready for when you know the fat pitch comes because if you're if you're frazzled and
you're not going for a run and you're not keeping your mind right you're never going to see that how
that pitch you can be so worn out you're like i can't do this again i can't do this again so but you have to do it again because you have
to do when the market's ready for you to do it you know not saying you i'm just saying in general so
there are a lot of people really really worn out here so you know but and again to both either one
of those things could happen like like hit ibm today now they're talking about there's gonna be
this big news on enterprise.
So are they gonna bring down enterprising cloud?
Does that have to happen before,
you know, we wash out this AI fear cycle?
I don't know.
You know, but again, with the spies at 681,
a lot of things could happen and go wrong.
But if we do get that counter trend rally,
that probably brings the spies to 700 because everything else acted well,
does really well
when there's no more headwinds from you know the names that are you know causing these kinds of
anxiety but um but then like you know you read that article there is some things you could take
from it somewhat you know like like my son's 17 years old i'm trying to figure out like okay what
what jobs and majors will he have you know when, when he's 27? What jobs, you know, are not replaceable, you know? And you have to think
a little bit, you know, A, you have to be able to use AI in everyday work. And like the other day,
my friend, you know, he owns a winery and he showed me his red wine. And within three minutes,
he showed me 40 marketing campaigns that were made by AI
that used to take a marketing firm, used to take a graphic designer, it used to take,
and it was made in literally three minutes. And it looked like professional where they were ready
to go on a multi gazillion dollar marketing spree to sell his beautiful red wine, whereas that used to take weeks. So there's definitely
some reason that some of these white collar jobs might be gone or some of these middle market
management jobs will be gone. So you have to kind of just think ahead. But usually the market and
the world changes and everyone changes and you might get down cycles. That's why you cost average
into funds. And even again, the biggest financial crisis of the world of 2007, 2008, by 2012, four years later,
the S&P was at an all time high. So, you know, what age?
You know, I always like to think of whatever I give out there as a value add, not necessarily
in the markets. And you really hit a hot button for me because I've got a 16 yearyear-old son and a 20-year-old daughter, right? And I wonder like, what
are their careers going to be? What are the skills they need? And I have to say,
I think the biggest skill that any kid can have, anybody can have in general,
it's two things. And the first one is so douchey, and I even hate saying it, but it's the best way
to describe it, is to have a really good brand
that represents you. And then the better way of saying that is to be really good at people's
skills. Because here's the thing. Let's just use what we do. When I first started trading,
when I first got on Twitter, there weren't that many people that had newsletters or trading
services. Now everybody has one. You can't turn around without someone having a newsletter. And to be honest, everybody can put
a chart of Apple up and everyone can draw, you know, circles around and everybody apparently
now knows technical analysis, everything, whatever. There's no differentiation anymore
there, right? There used to be even like a price differentiation. Now there's not.
Here's the differentiation. Some people say, hey, I like Scott Redler and I like
his personality and everything goes with him. I want to go with his service. Some people say,
I like Brian Lund. Some people say, I like Mike. Some people say, I like all three and I'm going
to subscribe to all three. The point is, is the only real differentiator I think in business,
in commerce, in whatever going forward is going to be people's personality and how they relate
to the person that's on the other side of the transaction. And so I tell my kids, treat everybody
fair. Don't go for the quick buck. Have some integrity. All these things that give you a good
long-term brand. You're not trying to flip a dollar today. You're trying to build long-term
equity with either your customers or your partners or whatever. That I think is really the only differentiator that's
going to matter in the long run. By the way, exactly what you just said. I bet your grandparents
told you the same thing and so did mine. So as much as times change, they really don't change.
You know, it is being, it's nice to be a good person. Don't, don't, I say to my son Chase all
the time, don't burn any bridges, do things the right way. And you'll always have relationships
and people who want to look out for you and, and put you in a place where you might want to go.
You know, so again, that's a, that's a very, very good point. To the point where my son right now,
like, you know, he was supposed to be going to the Maccabi Games to play basketball for the national team.
And he's a junior and it's the live period.
So basically if he goes to Israel,
he's going to have to miss the live period
where you get recruited.
So I'm like, listen, if we're not going to do this,
you better contact him and get this done now in February.
You tell him in May, he's going to hate you.
You tell him in February, hey's going to hate you. You tell him in February,
hey, it's four months out. So it's doing things in the right way so people don't hold grudges or
look out for you or just, you know, even if you end a relationship, end a relationship and say,
why? Don't ghost the person and be scared to deal with them. If you do things the right way,
usually good things happen to you.
So that's a great statement across, you know,
whatever the career is you're going to want to be in at some particular moment.
Yeah, for sure.
This, I mean, I don't know if I lucked into this or we did it,
but here we are talking on the spaces,
connecting everyone together,
having a great conversation.
I do appreciate everyone for joining in.
You should make sure you're following the speakers.
They will improve your experience on this app.
I did kind of start off a little bit
with some of those earnings here
that we got after the closures.
There's the Kratos.
I would classify those both in fin twit favorites
social media favorites i'm sure a lot of your group is watching them playing around talking
about them asking i'm sure it's one you asked about a lot i don't know if you you look at them
at all anything like that there's any other stocks that kind of really fall into that category right
away in your mind right now the last time i traded hims it crushed me. On October 17th, when it looked like it was going to break out,
and then I had that two-day breakdown, and I said I would never trade it again.
And guess what?
The stock was 50 then.
It had a false breakout at 62.
I got stopped at like at 55.
I lost a lot of money.
But guess what?
It could have been a lot worse, right?
The stock's 1552 now.
So down here at 1552, if you loved it to death, it's probably not a bad setup to play
options though, just options, like maybe buy the 17 and a halfs or the 20s if you think they could
say something that might spark a squeeze or whatever. So down here at $15. If you want to
throw some money away, probably like throw money away at Snap because it's so far down before
earnings like everyone does and loses. You probably could buy the 17 halves or the 20s.
And if it's a little better than fear or they say something that's kind of exciting,
you could make some money there.
I just thought I would buy the stock.
That's fair.
I'd imagine HIMSS is a big historic move where I can go and dig a little deeper.
I don't even know what the IV necessarily is on this one, obviously.
There's going to be juice with earnings options, as you
said, gamble type of thing. That's where you're kind of
playing this going into earnings. There's ways
to do it in more advanced ways,
but still, I think net-net, binary event,
gamble.
Yeah.
Hims, interesting one. Kratos, is that one you get
asked about ever?
K-T-O-S.
It's one of the drone ones.
What's the symbols?
KTOS.
Yeah, I've seen that one. Let me look at the chart.
I don't trade that one, so I don't
really... Yeah, those drone names have
done well. I haven't checked
super recently as well, but I know it was running for a while.
Oh, from 15 to 4?
Yeah, that's been left for dead also.
Yeah, listen.
Wait, are you looking at the right one?
KTOS.
It's at 94.
Oh, KTOS.
Okay, sorry.
Yeah, I don't really trade this one, nor I don't have any color or any really value
to add here except for, you know, the high was what, 134?
It's down to 94
it's it's not like it's obliterated like some other names out there so there's still some
support behind it so it's gonna have to be a good report i feel like you know you could say
it's got to get above and stay above 106 ish you know that's a that's probably a resistance um i
don't see many stocks that got beat down like this, you know, get, get back to highs all of a sudden this type of tape.
So, you know, I would just be, yeah, I don't know if someone else wants to talk about it, they could talk about it.
It's not, it's not exactly my wheelhouse.
Very good. We'll have some time going forward into it.
I was just kind of throwing it out there. It is one of the things that will be, will be talked about today.
I know a lot of people here like Apple or they want my you know my content on apple i know for me um i got
stopped out of it at 271 like a week or two ago but was able to buy it back on friday i figured
that you know a lot of the pressure around the markets around you know spend and the data center
build out and the energy build out and obviously obviously, Apple is not doing anything of their own stuff.
All they're going to do is take Gemini from Google or do a few things.
So I said in this environment, maybe Apple does better.
So Apple's been doing a bit better.
Everyone needs a handheld phone.
AI can't do that.
And what could they put their AI on?
They could put it on a phone.
So I think Apple is acting better. It was up today. It was
green all day while everything was lower. So that was one of the names I did not get stopped out of
today. So I'm still there. And, you know, it tagged resistance right around 269.43 and held
pretty well. Next time it tries to get back above there, it could do a better job trying. So Apple, to me, out of those make it count,
it feels like there's not as many buzzwords around that
that could get this down like in IBM,
where all of a sudden you think you're okay,
and then the stock gets hit down for 13%.
That is a a wild mover today
IBM but what about the rest of the
Mag7
Apple there appreciate the review
we got Nvidia earnings on Wednesday
that's kind of big event for the week
some people have talked
and maybe some people have this opinion in here that
the earnings maybe don't matter that
much
I told you guys on Thursday, Friday, 195.
So I'm kind of thinking now that everybody is so tired from it that maybe, again, after being in the same place a year ago with all that earnings power and everyone doing the spend, that it might be too easy not to be in it.
You know, that if so, but if so, if it gets gets above 195 there's really nothing to like 202 ish
so i figured that was that'd be something i wouldn't want to you know miss if i couldn't
get in so you know i like to buy it when it's lower the week before just in case it does a
pre-earnings run so i could help finance it so so today was actually nice it was a 193 and change
to trim it now i was thinking about buying what i sold this morning back but i'm just gonna i'm just gonna stay with what i have for right now because again market's
kind of tough and you know you don't always have to put on a trade that you took off just because
you had a good you know you had a good uh management of it um i guess you wanted me to say
of the other max sevens i feel feel like Google has been acting better.
It held 100-day, but it probably needs a little bit of time.
Google's still in the game where it's still being spoken positively.
It's a 311.
It went from 296 to 319 to 311, I would think.
309-ish probably needs to hold for that to be any good.
Amazon had a decent move also.
It went from 197 to 211. I would have liked it to hold in that to be any good. Amazon had a decent move also, went from 197 to 211.
I would have liked it to hold in a little bit better today.
It gave back a little bit more,
but that's what these things have been doing.
These are really just range trades.
Google probably could make a new all-time high this year.
I don't think Amazon,
unless it does it in the second half of the year,
it's going to be there to do that.
Just range, range, range. Tesla, I got
stopped out of. I don't know why I bought a little of it on Friday. Just thinking I want to not fully
lose sight of it. And then I got stopped out of it early on, about 10 points ago. And now Tesla's
broken. I don't even know what people are thinking. Maybe the narrative could be that SpaceX is going
to go public combined with Tesla.
So this way it could create some excitement around it.
But I don't think that could happen.
So I don't know what Tesla could do that could be exciting.
Because they have to do a huge spend themselves, right?
They have to convert a lot of their facilities that make cars into facilities that make humanoids or just the autonomous vehicle.
So I don't know.
Nothing looks so great where you're like, I'm gonna miss this I'm gonna miss
that it's more like where can I stay out of trouble here where can I stay out of
trouble there where can I make a little bit money playing the range you know
who may have it right it might be Apple by not doing the big data center spend
and just you know licensing through well they choose. Well, well, well, well, well, guys.
They might be the quiet little winner when this is all over, Scott.
Yeah, that was my exact thought on Friday when I'm like, it's kind of broken.
I'm like, but maybe they come after this, and they did it on Friday,
and I stayed with it, and then today we were buying it pre-market down a bunch,
and it held all day, so I'm thinking the same thing.
I think people kind of in the back of their mind are thinking the same thing
you just thought, say, hey, you know, they don't have to, you know, do these big offerings to
convert these huge data centers to have this, you know, big energy. All they need to do is,
you know, continue to. And, you know, I saw something about they're on pace for September
to have the foldable phone, which everybody's kind of waiting for. I know for me, I waited this
whole year. I have like the iPhone. I don't even know which one 12 or 13 which is fine i had
the big one and i'm kind of waiting for the foldable and if they do come out on time in in
september you know and and i think that people are going to definitely switch and that's going
to be a huge upgrade cycle for everything for the adapters for the airpods for the you know
chargers for for everything a lot a lot of Mac Minis being sold.
I don't know if it's enough to put in numbers,
but people buy a lot of Macs for these CloudBot things.
You know what's concerning to me today?
Is the phone going to cannibalize the Mac Mini?
No, no, no.
So do you know this CloudBot thing that's been happening?
Have you seen it?
Yes, yes, yes.
I've been reading about that everywhere.
For some reason, it's with like memory you combine you can combine the the memory storage of mac minis and mac studios
and stuff like that so that's why they're very popular in this but a lot of people buy mac minis
and mac studios for that specifically like whenever you see someone talking about claude bot and
they're showing what they're using to running it it is a mac oh wow so so basically they have the ai through the mac mini it's ai here we go this is the first i'm kidding
i i don't know if the market will take that but i should because they don't have to spend right
because it's there it's just part it's it's it's in the mac mini and yeah and i will say if you
look at like uh wait times for mac minis they've extended out a little bit. Again, the problem is iPhone is such a successful large business.
You've got to sell a lot of Mac Minis to start to stack up.
But the AI theme is pretty strong.
But the Mac Mini won't cut into the iPhone.
The Mac might cut into the iPad, right?
Not even if it's a new market.
The Mac might cut into the Mac Pro
a little bit like some of the books there,
but not much.
I don't think it's a huge market.
We'll see.
Stock Talk, I don't know either.
I don't know if it's big enough.
Stock Talk bought a Mac Mini.
He's getting into it.
I'm telling you, if anyone who's excited, if anyone says they're trying out ClaudeBot, they'd probably bought a Mac Mini.
I would ask them.
I remember people who had the Macs were like the graphic design people and like very artistic.
It's hard to be that guy now because you can say to AI, like, hey, make me a picture in the mounds.
It'll make you in two seconds. Hey, put an eagle there. Put a bear eating a fish. It's crazy to be that guy now because you can say to AI, like, hey, make me a picture in the mounds. It'll make you in two seconds.
Hey, put an eagle there.
Put a bear eating a fish.
It's crazy, right?
It used to take you four days to build a picture like that or an invitation,
and now it takes you three seconds.
That's why, again, there's some concern about all the things
that people used to have to do that don't have to do it anymore.
You just have to learn how to use it, right?
Scott, nobody's talking about the banks
well narrative that's that's great i love to trade apple when apple's you know leading and
acting special and making it easy because it hasn't done that in a while so if all of a sudden
the streets start to gravitate towards it because you might not have some potholes like everything
else that'll be and and the you know the all-time high is what a 283 so if you can get a great sequence
from 266 to to 315 in the next three months that would be fun we would make a lot of money
mike are you looking at axp today i i saw that but look at the bank i mean the banks just
absolutely rolled over today i mean that's a big part of the market. And it's like, ooh, this is not good.
I mean, there's, you know, it's a lot of really weird things going on in the covers.
You know, I will say, I'll come back to you, Mike.
The term, it's a stock picker's market.
And honestly, I didn't mind it that much, but I hate it now because of how much it gets used.
Every single time, every single market through the last five years,
whatever it is we've been doing these shows,
someone has said it's a stock picker's market.
This last couple months of Sideways,
of Sass, hitting 50-week lows,
I'm going through this.
The overall market holding in strong.
Some name's doing well.
I'll give it to you.
This one feels like what a stock picker's market
that definition should be.
And guess what you could use for that? My bread and butter moving average is if you want to pick
a stock that's strong above the 8 and 21 day moving average. Otherwise, it shouldn't be picking
that stock for momentum. It's below. It's below. Any stock that gets to the 200 day, it's got to
break the 8 and 21 day first. So active traders should be way out of the way when that happens.
I'm looking at my 52 week low list. I like to kind of filter it a little bit.
52 week high list didn't have as many interesting names. Netflix, Accenture, Adobe, Trade Desk,
Salesforce, Blackstone, Novo Nordisk, Okta, Palo Alto, Workday, Atlassian, Toast.
A lot of large cap names on this 52-week low list.
Who is Toast's favorite name?
I don't remember.
I'm kidding.
We did talk about it on here.
It was brought up as a play a while ago.
No, listen.
They were all plays a while ago when it was acting well,
but it's been cut in half.
So just talking more about the people on TV who put it as their favorite play, and then you don't hear anything from them for three or four months, and the stock's cut in half. So just, you know, I'm talking about more about the people on TV who put it as their favorite player.
And then you don't hear anything from them for three or four months and
stocks cut in half.
But every Monday, three, even a couple of weeks, listen,
we're going to come here.
You know, hopefully it goes up.
A couple of the earnings have gone well.
When it comes down, we'll, we'll, we'll say it, talk through lessons.
And that's really what it is, is, is we're here to,
to be the real and be relatable. I think is a little undersold in this area thousand percent and and again like
that's why i don't go on i go once a month to fox business they used to they want you to come
every other day i'm like so wait so i gotta i have to leave my office at one o'clock to go in
a car service to get to the city to then go into makeup to then wait 20 minutes to get a three-minute hit to then miss the close so four hours for three minutes for
two statements i'm like we could just be do it live on twitter or the sturdy club like it's not
that important to be on tv you know back in the day you know you no one would ever see you or no
of you if you weren't back in 2007 8 9 whatever but now it's like, hey, what does that do for you?
That's why when these people are on every day,
I'm like, they're playing traders on TV.
There's no way they could be so damn active
or do so many things for their business
that they say they have if they're on TV every single day
because it's a four-hour thing for three minutes.
But anyway.
Hey, Scott, let me ask you a question.
I suspect I might know the answer, but why have an office?
Why not trade from home?
You mentioned you couldn't get into the office.
Why not trade from home?
Because actually it's a pretty cool – this is like a story for a happy hour, but I'll say it real quickly.
So there was a group of traders that actually wanted to open up a T3
branch in Shorthills, New Jersey. And they did so right the same year that I moved to Shorthills,
but we didn't manage them. They had their own group and they used our economies to scale and
everything else. So about seven years after that, I became good friends with the father who put it
together. I love him. His name is Ashley Schultz. I mean, Robert Schultz and the son, this after that, I became good friends with the father who put it together. I love him.
His name is Ashley Schultz.
I mean, Robert Schultz and the son, this and that, they would ask me to come work here on Fridays to maybe help them recruit or whatever.
And then, you know, they got too involved in some stupid stock and the seven of them were all trading it.
They were told things were going to happen.
They never happened.
He got cut in a half.
They doubled down, got cut into 20 percent and they all got put out of business. So then the dad came to me and said, Hey,
you have a turnkey office. I put $400,000 in, but you only have to spend 3000 a month.
I'm like, I'll take it. It's a mile and a half from my house. So during the pandemic,
I was able to come here with six stations, fast internet, my own kitchen, you know,
I don't have the wife next, you know, doing her thing. She's a neuropsychologist or my son. Wait a minute. What was that? You don't have the wife next to you? She doesn't listen to
this. She better not. You'd be in big trouble. So, so, so I have an office that's literally a
mile and a half from my house. So, and then I have an office in my house, but she does testing.
So I let that be her office. So for the two times a year
where I probably could have used a really good setup in my house, you know, I kind of like was,
I'm a little lazy about it. I probably should have a better setup, but to come here, I could jog here
and walk to my office and I'm in the center of town and, and I have my own space and, you know,
most people remote in here too. So it's just me and a few others and, you know, I have the space
that I need and it's, you know, and it feels like you're out of the house and,
you know, you're at a job. Yeah, I get it. I mean, they're, they're really,
people underestimate the mental switch that happens sometimes when you shift locations.
Like I'll do this when I'm writing, I'll actually go somewhere else and write. And it's weird to
just put you in a different mindset. So I thought maybe that might have a part to do with it but man a turnkey uh situation like that sounds pretty sweet
yeah no but you're right too like you know when you're writing it's like your writing cap is on
like i wrote my note this morning from my living room my dog's barking you know this is going on
i'm like i'm trying to concentrate and write the note for my house to get something to my subscribers
and just to even the public because I wasn't coming in.
And it just felt different,
even though it was pretty good content.
It just felt different not being here,
in the same routine, in the same process.
So going back to even your statement,
back about telling your kids, what skill sets do you need?
What majors, what jobs?
It's really, it's your job to be a good person, have discipline, have routine, have a process,
because that'll help you with whatever job it is you're going to do and you're going to do it well.
So I know for me, if I'm not in the 2520, if I'm not here at the 630 club,
if I'm on a flight and I show up at 812, I'm trading differently if I get here at 812 than if I'm sitting here at 6 o'clock going through my entire morning process waiting for the open.
So where you are, you go about your day really puts your mindset in a position to execute effectively, where if you don't have the right formula and situation, you're losing a third of the battle.
Yeah. Hey, real quick note. This won't mean much to most of the people out there but to
old-timers like me it does uh ibm is down 13 and a half percent today this is the fourth largest
one-day drawdown ever so fun fact right and it's not a it's not a drone name it's freaking ibm so
this risk out there right um but listen guys it's45. I wasn't on with the virtual trading for this
morning. So I want to take him in through the last 15 minutes and do a recap because I just
got to the office. But I also wanted to come on here because I like to follow through on what I
say. And every day, every Monday at three o'clock, I'll be here. And maybe even more than that. I
think there's a small word that there might be a big conference in August, right, by this group. But I don't know
if that's public yet. Anyway, a lot of good things ahead. Be safe. You know, again, know your levels
in the range. 680, 37 just held in the spies. You know, 675 is the key. You know, 675 has been,
you know, channel range support for multiple for multiple multiple months you know and and ranges
are meant to wear you out so if you're getting worn out in the range the market's doing a good
job because when range resolutions happen you know that's when that's when the money happens and
we're a different type of money you don't want to be worn out if that's what you've been trying for
i'm not saying i'm going to break to the downside of it i'm just saying that's one spot and then
obviously 697 is is far away for now.
And I don't see anything,
you know,
being able to get us back there unless,
you know,
I don't know,
maybe even Wednesday with NVIDIA.
I don't know if that'll be able to do it,
but we'll see.
So know what you can handle.
Thanks for having me.
I got to jump guys.
I appreciate you,
Scott.
Always love having you on.
You guys should make sure you are following Scott.
Make sure you are following all of the other amazing speakers up here. We love this first hour, 45 minutes or so with Scott. Always love having you on. You guys should make sure you are following Scott. Make sure you are following all of the other amazing speakers up here. We love this first
hour, 45 minutes or so with Scott. And he gave you a little hint for something that
we might be talking about in the near future. I am excited about it. We are getting pretty close
to the market being done for the day. Some live earnings coming up. H hins and kratos will be reporting earnings ktos and hmis
we will also be having a special guest dan niles dan niles will be joining us here at the top of
the hour uh 4 p.m eastern right around there maybe 405 and we'll talk through some of the topics
sas nvidia earnings you know different tech in general some of his top picks we know
you guys a lot of you guys know dan niles he's been on the show before i am excited for that
coming up but we are about 12 or so minutes from the close again make sure you are following
the speakers that are up here i do want to run through a couple of the news stories for the day
because i think this might be the chance that i get. And people can jump in off other topics on that one.
I did just tweet out that IBM stock is on pace for its fourth worst day in history.
So if that's fake news, I know who I'm blaming.
I read through some of the 52-week stocks on the 52-week low list,
Netflix, Adobe, et cetera.
52-week high list was a lot less interesting.
FedEx, Honeywell, Verizon, Merck,
Union Pacific, a lot of gold names, a lot of gold miners. And then it kind of tailed off a little
bit there. Microsoft, as I said, down 20% so far in 2026. There was also a story around Amazon
announcing a new $12 billion data center plan in Louisiana.
That's their first data center in Louisiana.
Waymo, Google owned Waymo,
said that they have now driven more than 200 million miles using the fully autonomous taxi network.
NVIDIA announced some stuff with Palo Alto, Akamai,
different stuff partnering in that cybersecurity direction.
There was a big story around PayPal today.
PYPL, I don't know what ended up happening there.
PayPal is reportedly getting acquired.
That's not the real story.
PayPal, there are companies that are sniffing around them,
thinking if they might want to be doing it.
I saw one place say Amazon was one of the companies rumored.
I don't know if anyone saw that one.
But Paypal, WhoPal, Mr. PayPal might be getting an acquisition.
We'll see. At least that rumor came down. Stock is now up 6% today at $44. PayPal stock is at $44,
down 25% so far this year, down 41% on the one year, 84% the five year there you go max time frame plus 16%
there is still a time frame it feels like one of those rumors you get when something is so
beat up like you just hear that about Peloton all the time the Peloton is going to get required and
pins and we'll see yeah it was very early knows? Maybe it's PayPal leaking it, trying to get some stock price up.
But that's a fair point.
The article read as if it was super early.
It was an interesting headline today.
Trading was briefly halted there for a minute or two.
Stock was up pretty quickly, obviously, as we were saying there.
up pretty quickly obviously as we were saying there i saw google got a upgrade here from wells
fargo today up to overweight from equal weight there you go up to 387 dollars i saw asml announced
a new breakthrough or something around euv light source technology, I don't know what that means,
but people seem to be excited about this one.
I'll maybe ask some more of my technical friends.
Let me make sure I can get Monitive up here.
I always know that he likes talking with Dan Ives,
or sorry, Dan Niles.
Let me also send this over to Dan.
Ooh, I cannot.
So let's do this.
One step at a time.
ASML did have some news today, though.
That is that topic there.
ASML stock up around 1%, not moving too huge.
Trump had a couple headlines out this morning around tariffs.
Interesting comments.
Stimation, don't test him.
He's going through an interesting time right now and he does not want uh the eu to stop their tariff stuff there's a couple things
he did not want to have happen but there was a uh a bunch of trump truths trump tweets coming out
basically not going to also refer to the supreme court by by caps anymore it's going to be a
lowercase s lower lowercase c.
We did have Stellantis relaunching the Jeep Grand Cherokee,
just Jeep Cherokee trying to do a U.S. turnaround.
Eli Lilly, they announced that they can now,
they got approval to have one pen with four shots in it,
which is the monthly dose.
I don't know.
People thought around the news.
OpenAI partnering with consulting firms, McKinsey, Accenture, Boston Consulting, etc.
Get their technology built out by these large corporations, small, medium, etc.
Tom Lee, Michael Saylor updated their Ethereum Bitcoin holdings this morning.
Domino's reported earnings this morning. BPZ increased their dividend.
earnings this morning BPZ increased their dividend for anyone who doesn't know Warren Buffett Berkshire
Hathaway Warren Buffett's last this is what he owned as of the end of his term as Berkshire CEO
3.35 million shares of Domino's which means they just got a 6.67 million dollar dividend check
Berkshire Hathaway and Warren Buffett up from 5.83 million they would have gotten with Domino's pizza
increasing its dividend.
Uber coming out and launching a new suite of technologies for Uber,
for autonomous solutions, autonomous rides,
basically preparing for when full self-driving comes a little bit more,
even though it's close.
Delia had an acquisition.
Honeywell had some news this morning.
Novo Nordisk stock was down pretty aggressively earlier in the day.
NVO, there was a report from them that one of their weight loss drugs was not as impactful as Eli Lilly's.
Novo Nordisk continuation on the day down 16% NVO, hanging out around 39.71.
A lot of talks from the weekend.
Obviously, Friday, the Supreme Court came back and ruled back uh some
of the trump tariffs a bunch of different reactions pausing all this different stuff but there's a lot
of news stories around that as i was saying with trump comments as well um yeah that was a good
little rundown there bitcoin has been moving lower continuously i talked about it during there with
scott around 64k.
And again,
hymns and Kratos earnings will be here any second.
Dan Niles should be joining us and this should be a fantastic second hour.
Him should be out around four or five.
Kratos should be around out around 4 p.m.
Eastern right there.
Stock talk.
How you doing,
sir?
Do we have you?
Hey,
what's going on?
What's going on?
Can you hear me?
Yeah, yes, I can hear you.
I can hear you.
I appreciate you hanging out with us today.
What's Kratos earnings?
Yeah, Kratos earnings coming up.
I mean, it's a stock I've owned for a long time,
the immediate results of the earnings, but I will be paying close attention to them. Obviously
so not too vested into the immediate results of the earnings, but I will be paying close attention to them, obviously.
it's probably the most fundamentally expensive stock in my portfolio. Um, so I don't think it's
going to, you know, have the, uh, or I don't have the expectation I should say for it to hold up in
an environment like this where a lot of, um, steep valuations are getting smacked. So it's not a stock that I'm looking to, you know, make a ton of gains on an environment like this, but
my cost basis is so low and I love the company so much that I'm willing to hold it through the
volatility here. But yeah, they do have the report coming up. I'd like to hear any updates they have
around the drone dominance program, which should be getting into full swing here pretty soon.
They're one of the few companies that are involved,
one of the few publicly traded companies that are involved.
The other one is Teal Drones, which is a Red Cat subsidiary.
But I think they'll be pretty competitive in that program.
I think they'll be pretty competitive in the Golden Dome program.
The thing with mid-cap aerospace and defense companies is you have to lean on contract
cadence in order to make money i mean or in order to see the stocks go up you know these these types
of stocks tend to trade very expensive in the interim of new contract wins because the market
expects new contract wins floats the stock and then the stock sort of rolls into those events and becomes
either cheaper or more expensive upon contract wins or losses so that's really i think the way
you should look at all aerospace and defense stocks not just kratos so um i still am expecting
them to be a participant in the shield program a participant in the um golden dome program and hopefully a
participant in the drone dominance program as well along with all the deployments that made
to autonomous systems in the last six or 12 months which has been pretty uh growing pretty
impressively so um i think they're executing well but obviously the stock has become expensive i
think when you look at almost all of those specialty uh aerospace and defense names from
last year i mean even names like aeroVironment, they're very expensive.
You could say with good reason because there's very, very few drone companies at scale in the United States.
And so you could argue that is for good reason, but it's still true that they are expensive.
And this is not a market
environment where expensive stocks have been treated very well. So, um, yeah, I don't expect
anything out of the earnings, but I will be paying close attention to them. Um, it is a pretty small
weighting in my portfolio at this point, it is, uh, less than a 3% weighting. So it's not something
that can really hurt me either way. But obviously in general,
today was a pretty big sell day in the market for a lot of my names.
So that's not necessarily what I'm focused on in a vacuum,
but I will be looking at the report.
I will be listening to the call and looking for any points of potential signal
there.
What else is going on in your world?
Obviously, Ernie's coming up here.
Dan joining in.
We'll have time for a good Stock Talk rant,
maybe off the back of this.
But any other, like, pressing stuff?
No, not really.
I mean, most of my earnings are done for the season.
Let me see.
I have Penn Geologistics, is actually has been acting very well during this selling.
It's whole daily and weekly structure holding really well.
But I have that coming up on a March 11th week of March 11th.
I don't know which exact day it is, but it's between the 11th to 16th.
PLPC as well, which is another grid name that's coming up then.
Outside of those two, I think everything
else is done.
Reporting from, oh, you have OSS
as well in the second,
third week of March.
I know earnings,
do matter, do care about them. We look at them
a lot, but that's not what you sit here
talking about.
I will say, I want to ask you separately,
Friday tariffs got rolled back we
really didn't even talk about it that much because i would have sat here and told you it's probably
not going to happen again they're just going to delay the decision you got any thoughts we got a
couple headlines out of the weekend yeah yeah um it's more uncertainty really i think now it's more uncertainty, really, I think. Now, it's funny because we sold off last year on tariffs
and now we're selling off on tariffs getting rolled back.
But, yeah, I just think it adds another element of uncertainty.
You know, you're going to make the argument that markets were adjusting to it
or it had, you know, a year to adjust to tariff policy,
and companies did too.
And now you're throwing another wrench in the mix where some tariffs might be rolled back. Other tariffs might be
increased by virtue of Trump using a different vehicle to impose them. So it's sort of ironic
that, you know, you get two sell-offs a year apart on the same issue, but on the inverse part of that
issue, right? Being rolled back instead of being implemented.
So yeah, that's interesting.
I haven't, I can't make like a concrete perspective on it
until we know exactly what's going to happen
in terms of the refunds
and what other vehicles Trump might use
to impose those tariffs.
So it's tough to get a decisive opinion on it here.
But I'm sure we'll find out more
in the coming weeks and months
on what the aftermath of that might look like.
But initial reaction is just, yeah,
it's just another element of uncertainty.
And I mean, this market has been juggling
a lot of balls for the last two years
and has done a good job of sort of getting past those issues,
climbing walls of worry, if you will.
Now, I think it's starting to culminate in, you know, some selling, which is what we've
seen in the last couple of months, especially in momentum names, market leading names.
And, you know, does it happen from time to time?
Even in bull markets?
Yeah, absolutely. And is the S&P 500 and the Qs still in the bull market? games and you know does it happen from time to time is even in bull markets yeah absolutely
and is the sb500 and the q's still in the bull market yeah technically speaking but
um i think the q's have looked ugly for a couple of weeks now and today's candle i think just made
them look even uglier constant 21 ema rejections on the daily uh it's just not an environment you
want to be a hero in um you know there's a couple more stocks i'm looking at
i'm like hesitant to even throw arrows in this environment because um of how choppy it is and so
you know i'm more concerned about protecting capital until the trend solidifies uh one way
or another whether that's a reversal or or we continue downward. But this action is pretty reminiscent through the first
month and a half of the year of the action we saw at the beginning of 22. Obviously,
the macro conditions are very, very different. You had rate hikes then. We have, I'm assuming,
we're beginning a rate cut cycle here. And so the fed pressures are different the economic pressures are different
obviously in 22 we didn't have the whole ai uh theme really so it's a very different scenario
but technically speaking just from the chart it does uh there is a lot of uh um similarities to
to what the charts looked like at the beginning of 22 so yeah it's just something i think we have
to take week by week until,
we get more clarity on what the fallout from the tariff thing is going to be.
And also,
once we get some clarity on a video earnings,
which are coming up this,
this week and,
you know,
it may be in Jensen's hand once again to stabilize,
enthusiasm in,
in the tech market.
we'll see,
obviously that's right around the corner two days from now.
Yeah, I did see Kratos numbers come out.
Initial move is lower.
We'll see.
We'll let them come out.
EPS, revenue above expectations.
Forward guidance, I'm seeing slightly below expectations.
Maybe that's what it is.
We'll keep an eye.
I know HIMSS will be out in a couple seconds.
I did see dan niles
joined us up here i'm excited for uh for this conversation i think you're just gonna have to
move the mic a little bit further away from uh from your mouth there uh it was a little close
uh but if you just hit that unmute button in the bottom left of your screen uh i am excited to have
you up here sir hey evan how are you i'm doing fantastic i always enjoy these chats every uh
every quarter every month we'll see exactly what the cadence is we probably gotta get something
done but i enjoy this i'm doing well i'm doing well it is a very interesting week in the market
stock market has been very particular we could say so far in 2026 nvidia earnings this week
a lot of news going on we had some tariffs tariffs, rollbacks, and Sasspocalypse.
I don't know, but I hope you're doing well. I'm excited for this conversation.
Yeah, I'm excited for it too. It's definitely been an interesting start to the year, that's for sure.
Yeah. What's the top thing that you were, when we were talking here, that maybe you were excited about in this conversation?
I have a couple topics down, S, NVIDIA earnings, Boeing, etc.
But what were you maybe
excited about? What topics are you
maybe watching the most right now?
Top of mind.
The main thing I think I'm thinking about
and I've been
wondering about it
for a few months is
just
every major innovation in technology,
you know, people get worked up about and go, oh my God, it's going to destroy a lot of jobs.
And, you know, every innovation is pretty much, whether it's the computer and you probably,
you know, you're maybe too young to remember that.
But when the computer came along, people were like, oh my God, it's going to destroy all these jobs,
white collar jobs. And at the end of of the day it created all these new jobs and the thing that
i'm wondering about with this one with ai is is this one fundamentally different and you know
originally if you had asked me this question like you know six months ago or maybe a year ago. I was more in the camp of
there'll be tons of new jobs created from the different ones than the ones we have.
What I'm starting to wonder about now is are you really going to have a very large problem with
the white-collar workforce? Because yeah, you're going to create new jobs in terms of people who really know how
to use AI well to prompt, you know, whether it's Anthropic or whatever your favorite Gemini,
whatever your favorite coding engine is, to write programs that work well that then a human's going
to have to go in and clean up. And, you know, that'll be a new job.
But in the meantime, along with that,
are you going to be replacing whatever,
you know, five to 10 junior-level programmers
or entry-level programmers?
And so is this kind of a fundamentally different shift?
And so it's something that, you know,
I'm fundamentally an optimist
and believe in human ingenuity
and that every great invention in the past
has led to more jobs and a better standard of living.
But this is one I wonder about.
I've tried to take the optimistic approach.
DocTalk has very set in his mind that we're all effed in a slightly maybe nicer way sometimes.
But he's in the, I don't know, that more basket.
Yeah, I am in the camp that it won't be like other technological revolutions.
Because I think this is the first technology that purports to replace human intelligence entirely instead of being a tool.
And I'm not saying we're there yet.
I mean, humans are still very useful.
But, yeah, I mean, I've thought a lot about what Dan's referring to, too.
And from my perspective, I just don't see a scenario where this doesn't just destroy the marginal cost of human intelligence.
And that is scary, kind of. destroy the marginal cost of human intelligence.
That is scary, kind of.
Yeah, and I'm sort of, I get a first-hand view to this to some degree because my son Warren is, he's doing a startup
and he's been programming since he's been, you know,
I don't even, you know, at least 10 years old.
He was breaking into our computer at 12
and changing the kernels
so we couldn't stop him from gaming at night.
He's deep in the weeds
and he programs everything from the UI
all the way to his own database and such.
I'm watching how he's been using Gemini
and we talk about it every day
and how that has changed over the last three years
as he's been adopting different tools.
And it's really been incredible to see the advances in this.
And the thing I always go back to is this is the worst it's ever going to be.
And so some of the things it can't do well right now, and we were talking about this last night where he gave a bunch of AI prompts to gemini to do certain pieces and said don't do
this do that and it's like these are like four page prompts right and so or maybe more but
it would because it couldn't get it to work it then overrode some of the things he didn't want
it to do so then he had to go back in there and then fix that and so there's still some bugs but
as as he was telling me he goes like yeah, yeah, it's incredible. Like the front end stuff,
those guys are completely screwed in terms of the GUI interfaces and making the website look
pretty and all that stuff. The backend stuff, you're trying to integrate it with payments
and things where you're moving money around. That's still a lot more insulated or even security or database where you can't afford to screw that up.
But it's, yeah, it's pretty crazy seeing how this stuff is changing.
And so, you know, I've been negative on certain sectors around the AI thing because I'm certainly not in the camp that you hear some of the eternal optimists on
the media talking about how NVIDIA is going to a trillion or whatever, or Bitcoin is going to a
trillion. But I think this is potentially a lot. I had been thinking this was closer to 97, 98,
in terms of, you know, you went through a digestion period during the internet infrastructure build out as well.
And, you know, Cisco went down like 37, 38% at points in 97 and 98.
And each year the stock finished up, I think it finished up 97, it was up like 30%, I think, to end the year.
And in 1998, when it was down 38% entry year,
it finished the full year up 150.
I'm starting to wonder if this is honestly more like 2000
for some of these tech stocks.
And we're about to hit a really bad portion
where unemployment starts to surge
as we get towards the end of the year.
Not directly on that. And Stock Talk, I'd love for you to cut it at any point. We just got two
earnings out, Kratos and EMS people are watching. They have a very similar theme on them on forward
guidance. Next quarter's forward guidance was below expectations. The guidance for the fiscal
year was still above expectations. This seems to be a little bit
of a theme we've been seeing on here.
I wonder if that's something you've noticed.
Stocks have been getting penalized for it.
Is that something? How are you thinking about
that, treating that?
That was over to you, Dan. Sorry, that was over to Dan.
I apologize. Bad wording, yeah.
But stocks, the next quarter guidance being below expectations,
fiscal year guidance still being above expectations,
seems to be a theme of the earnings season that we've had, that I've been seeing.
Yeah, I mean...
Evan, am I on?
Yep, yep.
Oh, sorry.
Yeah, no, I mean...
That kind of stuff always frustrates me, because. Yeah, no, I mean, that kind of stuff always frustrates me because I go, all right, so basically you can't get your visibility or whatever the forecast were that people had out there with some guidance from you is worse than whatever the street was modeling over the next 90 days. But somehow over the next 365 days, it's all good. And so you're basically
increasing the bar further out in time where there's more uncertainty. And for me, honestly,
any company that guides out for a full year, I look at suspiciously because I go, you really
don't have that kind of visibility. I mean, even one quarter out, a lot of these names,
it's a lot more challenging than you imagined.
And so for me in general,
if a company cuts guides below for the next quarter
and raises for the out year,
I'm incredibly wary of that kind of guidance.
This is the best way I would put it,
especially if it's in, you know,
a space with a high technology component associated with it.
I mean, if you're talking something like, you know,
consumer staples or whatever,
like that's in a different category.
But I think especially in technology,
that that bothers me, I guess, is what I would say.
Yeah, that is fair.
It's been, like we were saying,
very interesting start to the year.
A lot of these SaaS names.
I was looking at my 52-week low list today.
Names on it, including Netflix, Adobe, Palo Alto,
Salesforce, Trade Desk, Passenger, Blackstone. I can continue. names on it including netflix adobe palo alto salesforce trade desk passenger blackstone i
continue and continue there's a little worry going on around ai we were talking about it there
the sass industry has been feeling it uh pretty pretty aggressively i'm curious your thoughts on
it in general are there any kind of names within that that pocket where you're what you're thinking
are maybe unfairly being a part of it?
Any of the ones maybe I was talking about there?
Well, I think it depends on if you're talking long term, meaning, you know, two, three years from now, whenever we finish hitting bottom.
I mean, so let's just go back in time. So if you go and look at the internet aftermath,
it took two and a half years for NASDAQ to finish going down 78% from peak to trough.
The good news is we're not coming off of the same astronomical valuation levels
that we were in 2000 for some of these tech names, right?
NVIDIA is trading at 25 times earnings.
It's not trading at 150 times earnings. So
hopefully, even if this is 2000, NASDAQ doesn't have to correct by that amount,
and tech stocks in general don't have to correct by that amount because you're not sitting at the
same levels. Now, having said that, you can say, well, yeah, but in 0102,
I didn't have the same concerns over job losses that I had today.
And so that's kind of the pluses and the minuses compared to that period, which is valuations are
a lot lower, but this may be a lot more structural problem than a cyclical problem,
because don't forget we had a recession in 0102 as well. Now, within that, if you look at software,
the names where I would like to go bottom fishing at some point or potentially set up longs against
shorts is, and I think we touched on this a little bit, but a company that does a database,
that's the one thing you can't afford to have screwed up.
So to do that yourself, you're really putting your life in your hands if you screw this up.
Because if you lose your customer information or social security numbers or whatever it is, you're dead something that you made internally and you screw that up,
the regulatory risks, the compliance risks, all of it are going to get you.
And it's the same with security.
And I know that Anthropic came out last week with some things in security side that blasted those names, and I wrote about it on Sunday night.
But that's another area, right? It's tied to the first problem,
which is, you know, you get hacked and all your data is stolen, especially if you're a public
company and you're dead. So anything with, I think, proprietary data to you, anything that
has high regulatory compliance, anything that involves moving money around where it's sort of embedded in the software that you make.
You can't absolutely have that go wrong and end up having money transferred to China by accident.
Those are the types of names that, to me, I want to be involved with at some point.
to me, I want to be involved with at some point. But much like we just talked or I just mentioned,
it was a two and a half year period of time to find that ultimate bottom.
With a lot of rallies along the way, as I always like to say, the S&P had seven rallies of
14% on average each during a two and a half year period of time while you lost 49% of your money.
And NASDAQ was obviously even more volatile than that. So that's what I would say is database and
security is kind of where I want to be ultimately, because I think those are the companies that will
handle this the best. But everything else, I'm still trying to think through right now.
But even those names right in the near term
could get hammered
because I think for smarter investors,
they sort of are thinking along the same lines.
And so those are the names
that probably have been sold the least to some extent.
I see a Sam Badawi hand up.
You had a question?
Yeah, so I mean, I agree with Dan.
I mean, just because you can possibly code some sort of code scanner,
which is what Anthropocode security was,
it's not exactly, I think the market doesn't really understand exactly
what's crowd track is in terms of cybersecurity,
and they're just doing a broad self, a lot of cybersecurity stuff. These software names were expensive cybersecurity, and they're just doing a broad sell-off a lot of cybersecurity stuff.
These software names were expensive before,
and they are still expensive.
Now, they've had a premium for quite some time,
being that we were in a crazy bull market,
25% year over year,
every single year for the last three years.
So even CrowdStrike here at 15 times EV sales forward
is still expensive, right? So I don't think this is
so bad, but the degree and magnitude of how fast it's happening is my concern. Yeah, and I think
to your point, if you go, like, I was around when Marc Andreessen wrote that piece in August of 2011,
and I remember reading it, and it was entitled Software is Eating the World.
And that was written in 2011.
So if you take the peak of IGV and, you know, kind of that October of last year as the peak, you go, that's, you know, 14 years of pretty much unadulterated move higher. So are you going to really unwork 15 years
of people believing software is eating the world and every dip being a buying opportunity in,
what is it, five months or something? Yeah, I don't think so. And I think it's going to take
a little bit longer than that, to your point. So I think you're exactly right. And the other part of that is you kind of say, well, you know, U.S. economy is three-fourths services based. 35 to 40 percent is really knowledge-based work.
and if you believe some of the stuff you hear out there,
which is AI will be able to replace all those tasks in 18 months,
and those people tend to be the higher earners,
and you work sort of backwards and you say,
well, 10% of the population does 50% of the spending.
A good 10% of that is probably knowledge-based workers.
You can come up with some scary stuff,
especially if this is more
a structural issue
versus arguably a more
cyclical issue in 0102.
But yeah, I mean, it's
14 years of software's eating the world
and you've had five months of
well, maybe it's an issue,
it still bothers me to some extent how much optimism is out there
in terms of at least what I see being written of, you know, don't worry about it, it'll be fine.
Dan, long-time follower and, you know, been in awe of some of your, you've had some very poignant takes,
very accurate takes over the last five years.
I had a two-pronged question for you.
Number one, you see Visa, MasterCard, American Express down 8% today, you know, on a sub-stack write-up.
You know, should Warren Buffett stop reading 10Ks and start reading AI sub-stacks, number one.
reading AI sub stacks, number one. Number two, this SaaS sell-off is really, this multiple
compression has really been happening since 2021. I remember reading every IPO prospectus,
every SaaS company said they're a monopoly. And today, there are over 5,000 SaaS companies.
There's no way. All of these companies can be monopolies in their own sector. And, you know, they've gone from 1% free cash flow yields to 3% free cash flow yields, broadly
speaking. But half the free cash flow, you know, you have to discount because they're,
you know, in the cash flow statement, half of it's stock based comp. So, you know, the average
software company is still trading at well over 30 times, well over 30 times cash flow when you account for dilution
and you make it a real cash expense. So how are you thinking about this sell-off? Is a lot of
this sell-off just multiple compression? And similarly with Visa, MasterCard, American Express,
are the businesses fundamentally challenged or is it just multiple compression? There's just too much money chasing too few opportunities right now.
So I'll try to get each of those separately. So MasterCard and Visa, they're the payment rails.
And so I do kind of view them as going back to what I said before, what are the two areas that I think will come out of this? Okay. I think it's going to be a security database. And then when you have payments embedded
in the transaction. And so MasterCard and Visa as the rails should be fine. Now, having said that, you can say, well, yeah, but you have also some pretty big innovations over the last multiple years where you may remember RTP was launched in 2017 as a payment rail.
And it's owned by the world's largest banks right JP Morgan Bank of America
Citi etc and it's the first new core payment you know core payment rail in the US in over 40 years
and unlike the ACH system which processes in batches this can take you know which can take
days to settle the art the RTP stuff settles individually and basically instantly. Right. So. Could you have.
AI going ahead.
And then kind of bypassing.
The Visa MasterCard.
If that stuff.
Gets used by this AI agents.
You know.
A lot more.
Going forward.
How would they do that at scale?
Would they need to do it on some stable coin
network yeah and and that and that and and don't forget a lot of the banks are sort of headed down
that path too so you sort of sit there and you go all right well and then you know then obviously
the recent one which is kind of tied to what we just talked about, is FedNow got launched in 2023
because this is the first really major infrastructure project from the Federal Reserve
since the intro of the automatic clearinghouse back, I don't know, 1970s or something.
And so you can instantly send money to someone using that now. And it's like, you know, less than five cents a transaction, etc. with some sort of stablecoin even if you wanted.
It's just some stuff that I'm thinking through in my own head,
especially because I kind of view Visa and MasterCard as more secure
and having less of a chance to get their margins compressed.
But I do wonder if Agentic kind of increases the threat
because you go back to 2017,
that definitely came up as an issue when RTP got launched.
And then again, briefly in 2023 with the FedNow stuff,
but like you integrate that with agents
and you do start to wonder about that.
I mean, to your point on free cash flow, that's the really big problem right now with the best capitalized companies in the world, such as Google or Meta or Amazon, etc.
Meta or Amazon, etc., where that's why these stocks are having, well, it's one of the reasons
these stocks are having so much problems, and Meta is probably the best example of that, which is
when they reported the most recent quarter, they really, you could argue, over the last several
years have been using AI the best to increase both the top line and the bottom line.
And that's really why the stock has had such a huge move really from 2022 to today.
And if you look at how it kind of traded when they reported, you know, 90 days ago that quarter, the stock was,
you know, I think it was up like, you know, 10% or something. And then, but then it started to
come right in right after that because of people going, oh, wait a minute. Yeah, you put a great top line number, you put in a
great bottom line number, but actually not 90 days ago, 30 days ago. And then the stock fell
from there because people go to your point, well, yeah, but you're going to basically break even
or close to break even this year on your free cash flow. And then based on what you're saying,
or close to break even this year on your free cash flow.
And then based on what you're saying,
your spending is going to go up even more in 2027.
So you're going to go negative.
And so you kind of look at that and you go,
these companies that were CapEx light three years ago,
cash flow, free cash flow, massively positive,
are now going to free cash flow negative and asset heavy
in that you've now got all this infrastructure that you're putting in.
The big five are going to spend about $700 billion in CapEx this year,
which is up 58% year over year, roughly.
And, you know, 90 days ago, we all thought that number for CapEx spending was up 25 to 30%,
not 60. So, yes, your question, I think, is the relevant one, which is survivability of problems always comes from your cash generation capability or cash on the balance sheet.
And right now, some of the best companies on the planet are going free cash flow, break even to negative, like in Amazon or Meta.
And so that concerns the heck out of me.
And how long will that continue is a big question. Will it only be one year or will it be two years
of this cash flow burn? And just last follow up on your stablecoin point, you know, if we are going
to an agentic payments network where we have stablecoins that you know have very low fees and efficient
payments you know every time you do a transaction on ethereum or solana rails you burn a little bit
of ethereum or solana so it should theoretically also be bullish for those networks so no you know
so two questions there what do you think yeah i mean let me put you this
way i'm not i'm not a bitcoin bull so let me just be very clear so i'm not the right person to ask
um because i sort of i don't view bitcoin is that interesting unless you live
in a third world country or second world country and you
have some doubts about your currency or your political system or whatever, or you're worried
about being debanked or something like that. So for me, this whole thing of this is digital gold
doesn't clearly work because you've seen what gold has done and you've seen what bitcoin has done with the most pro cryptocurrency president we've ever had and so i just sort of step back
and i go well what has it done and i go given the backdrop and the tailwinds it should have
and i just i just have problems with it.
Now, I'm not saying that it can't be a percent or two of your portfolio,
but that's my very high-level view on it.
I always go, what thesis do I have?
And then what is actually played out?
And if those things don't match up, I go,
up, I go, there's probably something that doesn't make sense within there. And so I wouldn't say
there's probably something that doesn't make sense within there.
that I am the right person to ask on this. I know the bull case, but if you go back to what all the
bulls were saying a year ago, it certainly has not played out that way or two years ago. So let me leave it at that. I'm probably the wrong person to answer this
question in that way, because you're right. Like what I'm saying around,
maybe things using stablecoins more should be somewhat positive. But you could also make the
argument of, well, if it's stablecoin and it's not Bitcoin, then is that actually negative for Bitcoin pricing? So it's something I'm thinking
about. I'm not a big bull in that space. So, you know, I'm probably the wrong person to ask other
than it being sort of a speculative asset. And if you've got, if you're in very speculative times,
then great, own Bitcoin. And if you're in a time times, then great, own Bitcoin.
And if you're in a time that's more risk-averse like you are now, that's not a good place to be, which is why I like gold better if you ask me, which is why I have the positions I have to some degree.
I do appreciate you, Jay, and feel free to chime back back in I see Sam with his hand up but I do want
to ask you quickly it is Nvidia
earnings week
a lot of eyes on Nvidia do you have any thoughts
on that name maybe
also it impacts
so much of the market that is working
here so I'm curious if even like some
effects
yeah no completely
yeah with with with
nvidia i would bring you back to 90 days ago when they reported and i remember that day well um
in that the stock you know they beat revenues and i wrote about this in my post on sunday night
but they beat revenues consensus printed expectations by 2.1 billion.
They guided 2.8 billion above consensus for the next quarter.
So unlike what you just talked about, Evan,
with I think Kratos and somebody else where they, you know,
lowered the next quarter, but then like maintained the year or something like
this was a true beat and raise, right? They beat by 2.1 billion.
They raised by 2.8. So nothing you can say is bad. Stock opens up the next day up 5.1%.
It finishes the day down 3.2. So that's an 8.3% reversal from open to close. And by the way,
there was nothing wrong with the gross margins either, which was somewhat of a concern given memory prices 90 days ago.
The S&P that same day on November 20th went from being up 1.4% at the open to down 1.6% at the close.
That's a massive 3% swing over the course of trading.
over the course of trading.
So what that should tell you
is that in a quarter where they guided above the street
for gross margins,
beat and raised by more than what they beat by,
and then, by the way, the stock kept going down
after that first day
until it finally got to its lows.
So to me and everybody else on the planet,
right, it's pretty clear that if you've got Google and Amazon and Microsoft and Meta and Oracle all having cranked up their CapEx, where now we're all thinking relative to when NVIDIA reported the last
time, 90 days ago, we thought CapEx for this year
was up 25 to 30%.
Now, 90 days later, we think the CapEx,
based on the guidance of these guys,
is up closer to 60%.
Stock's not very much different than where it was.
I'm bullish on it just because I,
relative to everything else in AI that you can invest in,
because I look at this and I go, well, I can buy the stock for 25 times, calendar 26.
The S&P trades at 23 times.
We're expecting the revenues to grow 59%.
That's what's modeled in the numbers and the EPS about the same rate.
in the numbers and the EPS about the same rate.
So from a risk versus reward basis,
if you're going to be invested in AI-related names,
this and Google are probably the two best.
And we haven't talked about Google yet,
and I can get into why I like that better
than pretty much most of the others.
But it's hard for me not to want to be bullish
into that NVIDIA print, but quite honestly, you look at 90 days ago, if you had given me the press release in advance, I would have never thought the stock would close down 3% after being up 5% at the open either.
reacts to the data. Right now, I think the big thing is the market doesn't really care,
and we're not trying to figure out, and I'm certainly not trying to figure out the next 90
days. I'm trying to figure out the next 365 days or two years, and what's the end state,
and where do we end up, which was the discussion we had at the beginning of the program of does
this kind of lead to a massive spike in unemployment? And especially in white collar, which would be really bad for the economy.
And so that's kind of what I'm more thinking about.
And it certainly didn't help 90 days ago, even though that quarter was probably the best NVIDIA had had in a long time.
Because if you go back to prior quarters, you know, the beats and raises were kind of skinnier leading up to that. And so that should
have been enough, especially with, by that time, Oracle's stock had already been getting crushed,
if you remember, from their earnings move. And so you were like, there was already some
concerns over AI and overspending by open AI and all that stuff that had already seeped into the
market. Oracle stock had already been getting pummeled from the highs from when they reported
in mid-September, and it didn't matter. Yeah, I'm curious in what do you think it is? You kind of
talked through Google there a little bit. There's a lot of competition conversation around NVIDIA.
There is general, like, looking for revenue from AI.
It's funny because SaaS is also getting destroyed
because AI is going to kill them,
and then NVIDIA, you might hear the other side of it.
So I guess pick your poison.
I mean, it's also just a law of big numbers.
Like, how can NVIDIA keep doing this stuff? PEs aren't that crazy, poison. I mean, it's also just a law of big numbers. Like, how can NVIDIA keep doing this stuff?
PEs aren't that crazy.
But, I mean, how can they keep growing like this?
We're getting to quite large numbers.
What's your thought?
What's your initial lean look?
Well, here's the thing, right?
NVIDIA's up here today.
So the bottom line is, if you really believe in this mass unemployment scenario,
in some ways, NVIDIA might be a better bet than it was 90 days ago.
Because the only way you're going to get there is you have to run all these programs on hardware.
You need way more compute to get to that scenario.
Absolutely. You need way more compute. You need way more energy.
Way more compute, you need way more energy.
Now, obviously, if you want to get into it, you can say,
well, yeah, but when you put skinnier versions of this resident on your iPhone
or something at the end of the year, you're talking edge computing,
which is going to be less intensive.
And you can get into those edge, not even edge cases, but you can get into all
the nuances around this, much like when you had the deep seek moment a year and change ago.
But I think very big picture, if you're going to replace wide swaths of the white collar community,
you're going to need NVIDIA hardware to do it. And it is still the white collar community, you're going to need NVIDIA hardware
to do it. And it is still the best. Now, are guys going to buy some AMD? Are they going to buy some
Cerebris? Are they going to try to find ways to get around and at least have negotiating leverage
with NVIDIA, which has close to 80% gross margins? Absolutely, right? It's back in the old days where
we would all joke like the only
reason companies bought from AMD was to try to have some leverage over Intel. It's the same thing
with NVIDIA, but let's not kid ourselves, right? NVIDIA is the gold standard. There's nobody close.
Now, if you want to do your own ASICs to try to save some money, obviously Broadcom is the obvious choice there in terms of, you know, obviously Google TPUs.
And so that's kind of it.
I don't see AMD gaining a lot of share or anybody else because you really already have somebody to keep NVIDIA honest, at least for the big guys, which is you got Google.
at least for the big guys, which is you got Google.
And I'm sure some of them will buy a little bit from AMD as well,
at least to keep NVIDIA honest also.
So that's how I think about NVIDIA.
And then with regards to Google, Evan,
if you think about who the ultimate winners are going to be,
and I've thought this for a while now,
they've really got the whole stack.
So they don't need to invent a consumer device like OpenAI is trying to do.
They already have Android phones, right, which are 80% of the global market.
And then they have their own Pixel phones kind of as the model for what you can do, right?
So they have that.
They have the way to monetize it, right?
OpenAI has just started to show ads.
Well, clearly that's Google's business model.
So there's no issues with that either.
They have a leading frontier model, which obviously OpenAI does as well.
But the advantage Google has is it has all this free training data to train on.
OpenAI doesn't have that, right?
When we go ahead and we sign up to use all these free products Google has, whether it's
YouTube or Gmail or whatever, we're not paying them, but we're giving up our rights to have
them train on that.
OpenAI doesn't have that.
Neither does Microsoft, right?
Business customers don't want
you training on their stuff. So that puts them in, along with OpenAI and Anthropic, in a very
different situation than, arguably, the most important if you're going into a tougher economic
time. And we saw the GDP print that obviously happened last week,
and that was way below expectations, but is that they have prodigious cash flow. These guys aren't
close to going cash flow negative. Even with the huge amount of $180 billion, which is basically
double what they spent last year on CapEx, they're still going to be cash flow positive.
double what they spent last year on CapEx, they're still going to be cash flow positive.
So they can fund all of this stuff to boot. And then they have their Google TPUs, which they've
been doing for a very long time. And so you look at that complete stack, and then they have,
obviously, the cloud business, right, which went from growing 34% 90 days ago to 48% this last quarter
because any AI startup is going, well, I want access to Gemini.
So between all of those different vectors,
and then you look at the multiple and you go, yeah, it's not cheap.
But at 26 times versus the S&P at 23 times, on a relative basis,
I think you have to kind of go NVIDIA and Google are the two ways to kind of stay long the space,
and then you can be short or negative on a good swath of the rest. With, I think, Broadcom, obviously, that's a play
on custom ASICs. The one scary part with Broadcom, which I'm thinking through, given especially what
happened with IBM, and so I think investors need to think about this. Yes, Broadcom has all that TPU business, but don't forget, they have a massive software business too.
This most recent quarter, out of the $18 billion in revenues, the majority of it was the hardware business, which is driven by all of this TPU stuff. But they also had a
massive portion of their business that's related to all these software roll-ups that they've done.
And as we've seen, software is not exactly the best segment to be in recently. Now, it's not
that a lot of these software companies that are reported have been missing numbers, but everybody's trying to think through the future. And so if you go, well,
$18 billion in revenues last quarter for Broadcom, $7 billion of that was infrastructure software,
which is at the epicenter of this dislocation, then that's certainly something you want to
think about, especially given what happened to IBM today.
Wild move in IBM.
I'm curious if you had any thoughts, Sam.
I'll come to you after, I promise.
But IBM with quite the move.
Down 13%, as someone said earlier,
it's fourth worst day in history, single worst day.
Yeah. I don't know why IBM stocked all new moves.
Yeah.
And IBM has, again, a lot of legacy software.
And you go, well, if AI can get in there and replace some of that, then obviously that's an issue.
And I've never been a big IBM fan.
I don't think you've ever had me on or I've ever talked on TV of liking this thing.
And I sort of stand by that statement.
That is a fair point.
Sam, you got your hand up?
Yeah, probably something that you might have addressed in the past,
but probably for the audience, it might be good to hear your input on it.
I do appreciate your input.
Your data and your backing of thesis does sound very sound
versus like, hey, everything's going to go up sort of thing.
But obviously we've seen Blue Owl, some news around them,
not able to acquire the $4 billion for the Coral Weave backing.
In addition to that, they were able to acquire what was like $1.2, $1.4 billion
from other companies, which they have a little bit of stake in
when they come insurers.
But what are your thoughts around that?
And do you think that this could be a contagion
that's going to spread around the data center infrastructure
building at this rapid pace?
I mean, I have shorts in those areas.
I'm not going to get into which companies.
But this is absolutely something that I thought
was going to blow up for a while.
And to me, it's very clear that, well, let's go back to a way to think about this.
So you could argue since late 2022 that basically anything associated with AI has gone straight up, right?
And then you could argue that that kind of continued until late October of this past year.
And that includes, to your point, you know, the private equity companies that have LBOed these software companies,
as well as the business development companies that have lent
to a lot of these companies to let them do this
or are now lending to these data centers.
And I absolutely 100% believe we're going to have problems.
Because the world has changed so fast,
but for at least since the end of 2022,
it's been a one-way trade higher,
and people have convinced themselves that everybody can win.
Now, if you step back and you say,
well, what happened after the internet bubble in 2000?
Well, how many winners did we have in e-commerce?
Well, one, Amazon.
What about in search?
Well, really one, that's Google.
What about in social media?
Well, it's really one, that's Facebook.
Well, it's really one, that's Facebook.
So now if you think about how many people we think are going to win in AI,
it's still a pretty long list, right?
You've got perplexity and Anthropic and OpenAI and Gemini.
And I sit back and I go, well, I think Google's going to win
for the simple reason of they've got more training data than anybody on the planet.
And it's free for them.
So to me, consumer AI is locked up.
And then on the corporate side, I feel like Google's in a pretty good position.
But, you know, Anthropix seems to be in a pretty good pole position there too.
You know, Anthropix seems to be in a pretty good pole position there, too.
And so then I go, well, a lot of these other companies are going to have big problems.
And even of the big guys, right, you go, well, Microsoft is really tied to OpenAI, right?
Like, they don't have their own leading frontier model.
It's really kind of an offshoot of OpenAI, and then they lose access to OpenAI's models at some point in time.
Amazon, like, they don't have a leading frontier model, right? And so they've kind of got an issue
there as well, and Oracle obviously doesn't. So you kind of think through that, and you go,
well, if I'm down to two guys that really win, maybe there's a third. Well, what about the
rest of this money that's being spent? And so then that goes all the way back to the Blue Owls and
business development corporations and private equity companies. And I think, yeah, I think you
have a huge problem in that group. And, you know, I mean, lucky or smart, so far that's not been a bad area to be
short. And it's just starting, right? Like, you've heard about Blue Owl halting redemptions at one
of their funds. You also heard about BlackRock's TCP Capital Corp., which had similar issues.
So this has been percolating underneath the surface
for a bit.
And I think especially if you want to get really dark
and say, well, if you do have a lot of unemployment
in the knowledge worker set,
then this spreads beyond just data centers to commercial
real estate and other things. So it's something to keep in the back of your mind. I mean,
for me, I don't worry about the credit markets. Sorry, I don't worry about the equity markets as
much. Because if you think about the investors in the equity markets, your downside's limited at 100%. You can lose all your money,
but your upside's unlimited. For credit investors, it's a very different situation, right?
Credit investors, the downside's 100%. You can lose all your money, but the upside is sort of
whatever guaranteed return they decided to give you. So let's call it, you know, whatever, high single digits.
So those guys are way more concerned of the return of their capital. Equity investors are more concerned with, you know, appreciation of their capital. And so when you have problems in
the credit markets, that should really scare the hell out of you because those guys are way smarter because their
risk reward is the exact opposite of an equity investor, right? You have basically downside of
you lose all your money and your upside is capped, where an equity market investor,
it's the exact opposite where your upside is unlimited. So when you see those stocks having issues, that should bother you for that reason.
And so that's why I wouldn't touch, like in five months, in my mind, if I use late October as the peak, which is when the software ETF peaked, the IGV, I don't think this is over.
I appreciate that good back and forth there Dan Niles is a very active
Poster on X
If you are not following him
You are missing out
In that last thread you were talking about there
Boeing is one that obviously you've talked about
A little bit as a
Stock pick for the year
You mentioned it in that post which
you put up last week we got any any thoughts on that name yeah no i mean i think in general
like we have in some investments in health care we we like industrial like boeing i mean i think
you want to look at this and say well what are the asset heavyheavy names that have low chance of being replaced by AI?
And Boeing, you could argue, they should benefit, right?
If you get AI to look over the planes and make sure the designs are more sound and look for structural problems, that should help them even more.
Obviously, it's an asset-heavy company.
It's also a quick way to fix your trade deficit with the U.S. if you're in the crosshairs of a tariff war.
And so for me, Boeing has gone, you know, they have a new CEO, obviously, or a new relative.
I mean, he's been there for only a couple of years.
But they're finally, the things that they've managed to do, have managed to start turning the company around.
Remember, it was only September of 2025
that they were able to self-certify planes.
So this is less than six months ago.
And that combined with NATO spending more of their GDP
on core defense,
we have the Golden Dome Project in the US.S. The company lost $2 billion in cash
flow last year. They should be low single-digit cash flow positive this year and then $10 billion
by the end of the decade. And by the way, that's not a high hurdle to clear because they did $14
billion in cash flow in calendar 18 before they had those fatal crashes in 2019 so they've got
over 600 billion in backlog which is nearly 7x their calendar 25 revenues so i think it's kind
of the epitome and and they're in a duopolis situation really with airbus so it's like i So I like that type of company in this type of environment quite a bit.
I mean, AI is not going to replace an airplane, right?
So it may help you to fly the airplane better and avoid crashes or build it better.
But yeah, it's kind of everything I want right now in a type of stock.
And that's why I think you've seen it hang in so well in this current market.
But in general, you can say anything
in what I call the messy category.
And what do I mean by that?
Well, messy being materials, energy, staples, industrials.
Those were all sectors that are up
kind of that 10% or so range, give or take, this year.
And so I think messy stocks are pretty good, right?
And in terms of if you're thinking about it,
and you can obviously throw some other things in there like utilities,
clearly as well this year, or real estate's kind of in that group too but
you know a nice moniker right messy
um i we have so many different pathways to go so much so little time i want to ask you a little
bit more about defense there is that the part that you are a sector that you're interested i
know you mentioned it there it's kind of one of things there yeah is there is that a part that you are, a sector that you're interested in? I know you mentioned it there. It's kind of one of the things there. Is that a part you're interested in?
Oh, absolutely.
Yeah, I don't think you can't be because you go, it's a great sector in the sense that it's asset heavy, right?
When you're not replacing a missile or an airplane with AI, but you can make that missile or airplane function much better with AI.
You know NATO is going from spending 2% of GDP to 3.5% of GDP by 2035
on core defense. So that's great. You've got the Golden Dome Initiative in the US also going on.
So that's great. And so yeah, defense, I think, and unfortunately, the world has not gotten
any more stable.
And so I think it's hard not to be bullish on defense.
And then you have the overlay of AI,
which means that it's a nice place to be where you don't have to worry about AI displacing it.
And it's probably a good help to it.
Is there anything, I appreciate Dan for joining us here us here fantastic we always love having you on the
spaces also done some live streams so there's been some clips that going around fun fact second most
viewed youtube channel uh youtube video on the channel there we go uh peter shift prime gold time
was the it was the number one so well we'll get back on the next live stream.
But the people enjoy listening to Dan Niles.
I appreciate you being here.
You guys should definitely make sure you are following his account.
But where can people find more of the stuff that you're doing?
What are some of the stuff that you want to leave the people with here?
We've still got a couple minutes left, but I want to make sure that we heard.
Any final thoughts?
Anything that you want to get into?
Any exciting projects you're working on, all this good stuff.
No, I mean, I try to post thoughts once a week on Sunday night on Twitter.
Obviously, it's a personal account.
It's not for, you know, stock recommendations, all the disclaimers.
It's just my personal thoughts, and it's not investment advice.
But I try to, you know, it's something I started,
I've been doing for a while, which is I try to sit down on Sunday and step away from the noise
and really think bigger picture about like where, what's the end state that things are going to be.
And so I try to put things up as I'm thinking about that and writing about it. And quite honestly,
it's also like doing kind of these longer form interviews with you, Evan, you do one of the best out there. So thank you for having me on.
Because I think there's all the day-to-day noise or month-to-month noise, but then the biggest
amount of money to be made or avoiding losses like in 0102, is trying to think if the world's really changing,
how does that affect things?
And so that's where I post on
at Daniel T. Niles is my handle.
Obviously, unfortunately,
there's a lot of clones out there,
which I keep trying to take down,
but they come up as fast
as I seem to be able to pull them down.
But that's my handle.
It's at Daniel T. Niles.
Spacing is super easy they can
literally just click through your profile on here and it will go directly to your page
just click in and you will be able to follow them perfect no clones no nothing
yeah but uh yeah so that's that's and you know i i try to be pretty transparent when my thoughts
are changing and obviously you know they are moving around a lot, especially as I luckily have a son who's front and center in all of this.
And I can kind of talk to him daily about everything that's coming out and what's going on.
We talk about that on here, but this is a market that opinions change about making money and going forward.
And information changes.
The environment is everything is moving so quickly.
Innovation is happening so fast right now and things are changing.
Opinions change.
And if you're so rigid in stuff, you're never going to be able to succeed in the market.
Yeah, and I'm working on a thought piece right now to your point on, well, I don't want to spoil it, but hopefully I'll put out something short.
But I think it's going to be really interesting and hopefully in the course of this next week.
So be on the lookout for that.
I think it'll make you laugh a little bit and make you think a little bit.
So it's something that hasn't been out there yet, but yeah.
Anyway, be on the lookout for that.
It'll be on my Twitter account, or X account, I guess is what you call it these days.
All one and the same.
I appreciate you for joining us.
Hopefully we'll get you on very soon
again. I know, I appreciate it, and
thanks for having me on, Evan. I always enjoy it,
and I can't believe an hour's already passed.
It's been great questions from
all of your other
speakers out there, and I appreciate
the great back and forth and thanks
for having me on and best of luck this next week it's and next year I guess hopefully we're as
lucky as the men's Olympic hockey team so that was a great game to watch so best of luck to all of
you and thanks for having me there we go I appreciate you for for coming on here we'll
we'll get you on many times before this year's over.
But yeah, everyone make sure you're following Dan.
Make sure you're following the other speakers up here.
I appreciate for the guys coming and asking some questions.
This little space is you can, once we do close this down,
we have another conversation coming up.
We're going to talk about Mercado Libre earnings tomorrow.
I'm excited about that.
But once we do close this down,
entire thing will turn down into a recording
and you guys can hear all the amazing stuff
that Dan just said there.
I'll even remember,
I'm going to put a note down right now
to change the start time of the spaces.
So it starts right at 4 p.m. Eastern.
Change start time.
All right.
If I don't do that, we won't do it all right i appreciate you dan all right take
care evan talk to you later bye-bye have a great one have a great one
we do have like i said ain't another conversation coming up here we're going to stay live for at
least another 30 minutes it is still the middle of earnings season this is nvidia earnings week
that wednesday we have or this wednesday we have trade desk salesforce snowflake iq joe b aviation
zoom etc nvidia earnings on that day to cap it up tomorrow there's home depot constellation energy
a few others realty income after close, Zeta after the close.
So we're actually going to be having a conversation.
Sam Solid, Sam Badawi is going to have a conversation with the Zeta CEO later this week.
But I want to talk.
Oh, did lied.
I didn't hear anything.
Mercado Libre, though, has earnings coming up tomorrow after the close.
I wanted to be able to dig in a little bit deeper onto that one.
I should have a couple of our friends join us down here,
the Crane Shares team and some others who are actively watching this space.
I'll get some stuff pinned up in the nest above.
Mercado Libre is a name that a lot of you guys are watching.
So I wanted to come on the spaces and dig in a little deeper one more time i really do appreciate
dan for for coming in here hanging out with us dan is awesome active participant of the stocks
on spaces we love hearing his thoughts and i am excited to talk here about mercado libre
numbers should be out tomorrow after the close around 4 15 p.m. Eastern Wall Street is expecting EPS around $11 and 57 cents.
Wall Street is expecting revenue around $8.5 billion. That revenue number would be quite a
large increase. Last quarter, they reported 7.2 billion. So some nice growth numbers there for
Mercado Libre, M-E-L-I stock. They have their earnest call coming up at 5 p.m eastern after the close
tomorrow um so i'm sure you guys will be listening to the call obviously this is an e-commerce play
coming out of latin america coming into also mexico as well i know uh and we'll be able to
talk through us a little bit that one but maybe i could start with you ryan how are you
doing sir he's not up here sam how are you doing sir oh are we doing the competition one year no
no no that's gonna be on a different one that is my fault um just give me your quick thoughts here
you can go over and do your stuff there i I want to hear your thoughts on MercadoLibre. It's a name that gets talked about a lot. Is it named the earnings or tomorrow
after the close? Yeah, I mean, I've been holding it for some time. I'm actually kind of surprised
of its underperformance lately. I mean, it probably does get thrown into the tech basket,
which is suffering as far as most of the other tech stocks.
I wouldn't really classify it as a soft first stock, but definitely I think the biggest issue
here is that the market is just generally associating this with a growth stock for e-commerce.
And clearly Amazon is not doing well, but that's probably for other reasons aside from that,
because MercadoLibre's capex is not nearly as
massive as amazon micado libre is not a hyperscaler um you know be that may i mean obviously if we're
having a bit of a pullback in tech totally expected that micado libre on that since they
are in the back of tech but uh the ewz etf which is the brazil etf which doesn't necessarily
represent the entire but vespa which is the the Brazilian stock market, is up pretty considerably year to date.
So I would have expected Mercado Libre
to catch a tailwind from that,
but it hasn't exactly.
Now, from a technical perspective,
the chart looks terrible for Mercado Libre.
I personally have not added to Mercado Libre
since I tested the 200-day moving average
a couple months ago.
And then when it bounced up,
I kind of trimmed a little bit.
But at the same time,
the long-term thesis is still intact. I don't see how AI is going to be disrupting this.
That's similar to saying that AI is going to disrupt e-commerce, which it definitely won't.
It's just going to make it more powerful. But the bigger question is, how's it going to affect
its fintech arm, Mercado Pago? Mercado Pago is essentially Mercado Libre's AWS. Not in the exact same sense.
AWS is obviously hyperscaler, but Mercado Pago is more of a fintech garment where we're talking
about credit cards, bank accounts, and so on. They are quickly expanding in South America,
which makes it quite unique from other fintech names that you'd see here in the US, like SoFi,
tech names that you'd see here in the U S like SoFi,
I can't think of shift four and all these other names.
So yeah,
I mean,
it has a lot of angles that they're playing here,
but I think the issue,
like I just mentioned is that's the tech name.
So tech sells off.
This is likely going to sell off.
I appreciate the,
the overview there,
Sam,
that was a good start.
And I would love to be able to come back
and talk through some of these MercadoLibre earnings.
I saw that Craneshares account joining us up here.
Who do we got from the team?
Hey, Evan, it's Henry Green. How are you?
Henry, how are we doing, sir? I appreciate you joining us.
Very well, thank you. Happy to be here.
I am happy to have you.
We are prime time MercadoLibre earnings tomorrow after the close. I wanted to talk in there a little bit. We'll focus in on some more of the Craneshare stuff in there in a second. But Mercado Libre, a well-watched game. I know obviously it's in your guys' world here. So how are we feeling going into these Mercado Libre earnings? I'm sure it's stock you're watching. I'm curious
if you have any thoughts going into it, and then we'll circle in more specific after.
Sure, yeah. I was listening a little bit to what was being said just previously, and I think
MercadoLibre is 100% e-commerce. they're e-commerce in payments.
They're not really in the AI game as far as I know.
They probably have a small cloud business, but I don't think that's really moving the dial for them.
They're in a really growth market, like even more so than China, I think.
Just e-commerce penetration across Latin America is still low,
and so they're just kind of getting that consumer growth online and benefiting from that.
I heard some comments about Brazil.
You know, Mercado Libre is kind of hard to, I guess, I struggle with pointing to like a macro factor for them just because they're operating in so many different countries.
Right. I think Brazil is up because of the currency, I believe.
And I don't think that impacts Mercado so much.
And then, you know, also playing a role here are because of Mercadoago, and they have this lending business as well.
So interest rates also play a role here, too.
And that's important to remember, right?
There were a couple Latin American central banks mostly keeping rates steady.
I think Colombia said they were going to raise this month.
So that does play a role with Mercado.
And yeah, it's down so far this year.
I mean, I'm hoping for the best for these earnings.
I don't have a particular view at the moment,, it's definitely an interesting name to watch. And again, it's one
of the I think it's one of the few companies that's really all about the consumer, all about
e-commerce. Right. I think that it's just, you know, it's's growing it's had fantastic growth um and it's gotten caught up but it's again
it gets caught up in these regional uh politics right and and you know you saw like with what was
happening with argentina weighed on this name um and then benefited the name right as you had milet
restructuring the economy right and so there's just's just Mercado Libre is a difficult one. There are just so many factors. Right. You know, and so, yeah, looking forward to the earnings tomorrow. I think it'll be really interesting.
I have more questions.
I do want to talk a couple more things now.
We're excited that we have been doing stocks on spaces
every single Monday through Thursday,
3 to 5 p.m. Eastern at least years.
We love doing that for free.
We also enjoy working with people coming on here
who are doing really interesting stuff in different spaces
and allowing them to kind of join our panels,
help us doing this stuff. So we definitely do appreciate the CraneShares team. I do want to
read out one or two things, and then we can jump a little bit more into the conversation. But as we
do talk a little bit about tickers here and some of the stuff that they have, we want to make sure
that you guys know investors should carefully consider fund investment objectives, risks,
charges, expenses, all that stuff before investing.
A fund's prospectus and summary prospectus contain that information and more about the
CraneShares ETFs. To obtain a fund's prospectus and key information document, you can visit their
website, craneshares.com. It's also going to be on their bio. A fund's prospectus and key
information document should be read carefully before investing.
We're excited to be working with that Craneshares team.
Like we were saying there, our goal is to just put interesting stuff on your guys' radar,
have interesting conversations with people doing legit stuff in the space,
and then you guys can go in and do your own research.
We're having these people on a bunch.
If you guys ever have any questions for anyone at Cranet Shares? Henry, obviously they're very popular for the KWeb ETF and other
stuff like that. But we're going to be talking a little bit more about MercadoLibre. And for
anyone who doesn't know, they actually do have a 2X single stock MercadoLibre ETF. The ticker is
KMLI. And obviously 2X single stock ETFs for people who are going in and trading them.
I just want to make sure this is on your radar.
For people who don't know in and use them, there are a lot more risks and stuff.
If this is your first time doing a 2X single stock ETF, please dig in deeper.
Daily reset.
All that stuff there.
But for the active people who are using these things and didn't know that something like this exists. Hey, M L I is the ticker there.
I wonder if you have any thoughts,
comments on what we're talking about there.
And I'm curious on the Mercado Libre earnings,
what like segment you were where your eye is going to be going first when
you're,
you're doing your research into it and when the numbers come out tomorrow,
what parts do you think is going to be like the,
the,
the driving force?
Um, yeah, I think I'm looking at Argentina sales.
I see Bloomberg saying growth could exceed 60% in fourth quarter year on year.
And that's just been a really volatile segment for a lot of reasons um and including you know political reasons um
it just there's been a lot of tinkering with argentina's economy necessary in many ways and
and they've done they've done well decently well that we see kind of malay's agenda um you know uh
it's uh it could could be doing a bit better now. So we'll see how that impacts.
Also, they've applied for,
looks like a license,
a fintech license in Mexico.
And so that's going to be probably,
they're going to advise as to where the progress is with that, right?
To expand their kind of lending and payments business of New Mexico.
So that's interesting.
Yeah, I mean, again, this is just a really great name, I think.
And it's really quality.
They've done amazing things in the Latin American e-commerce space.
And again, in an area where I already said this, but I'll say it again, right? E-commerce penetration is still low.
So there's just a lot of growth there.
Probably more absolute growth in terms of penetration rate than you're seeing in China right now.
China was always the leader in this e-commerce penetration growth, right?
And I think that Latin America has got a long way to go.
And MercadoLibre is right at
the front and center now they do compete with amazon in the region so if you look how amazon's
doing whether they're expanding into more countries um you know that's that's a factor
right um walmart i think also has a small business uh in latin american e-commerce um
in Latin American e-commerce.
And I think the lending business will be important to watch.
They're expecting, Bloomberg is saying,
it's expecting a margin to decline after losses.
In the fourth quarter, that's for the actual lending business.
So kind of looking at credit quality there and things like that.
And again, Mercado Libre, very interesting company.
Not so impacted by this.
Another thing I wanted to talk about today, the tariff narrative.
tariff narrative. They don't have, they don't ship to the U.S. So it's very insulated in that regard,
They don't have, they don't ship to the U.S.
more so than the other names in our single stock suite, certainly a name like PDD.
PDD really benefited from the Supreme Court striking down Trump's use of the Emergency
Economic Powers Act that we saw on Friday.
And that's a significant catalyst.
I think PDD was up again today, likely off the back of that same catalyst on the tariffs being reduced.
So that's really important for an e-commerce player like PDD, which does a lot of shipments into the U.S.
Mercado Libre, not so much.
You know, they don't have much to do with tariffs
because they don't really ship to the United States.
And so you're not going to get a tailwind
from the striking down of the Tariff Act,
of the use of tariffs in that way.
But, you know, I look at more Mercado Libre, you know i just i look at more of a caliber you know it's um
i think it's i think it's a long-term long-term hold um we hold it obviously yeah we have we have
kmli we also it's a large holding in our kemq etf which is uh technology including e-commerce um
technology, including e-commerce, all across emerging markets.
So that includes China e-commerce companies, Alibaba, the big names, Mercado Libre,
and then also chip makers, SK Hynix, TSMC in Taiwan and Korea.
So that's an interesting fund people might want to check out as well.
What was that ticker?
Yeah, KEMQ. Kmq mq okay thank you
uh i did pin up in the nest above a couple of the the one where kmli is you guys were wondering what
that ticker is there i have a little homework more to do into some more ETFs. I love these spaces.
We have to gen in a little bit more there.
Stock Talk, could I bring you in?
I know we've talked a little e-commerce here before.
I know we've talked a little bit about Latin America, Mercado Libre as well.
In general, what are you watching in this part of the market, this segment, Stock Talk?
E-commerce, Latin America, it's an interesting part of the market.
Mercado Libre earnings coming up after the close tomorrow.
I'm sure you'll have a thought or two.
What do you think you'll be watching, if I had anything at all?
That was over to you, Mr. Stock Talk, if we do have you.
On the Mercado Libre?
Yeah, yeah, M Melly Latin America.
I mean,
I don't know.
I don't own the stock,
so it's not going to be an earnings that I'm watching particularly closely in
this environment.
To be honest,
South America has done well.
Most of the South American ETFs are up year to date and individual stocks,
at least us listed ADRs in the South American space have done pretty.
All right.
I actually haven't looked at Mercado Libre in quite a while. I don't know how that stock's done year to date but okay has not done well
year today um just pulled the chart up uh that chart doesn't look great uh just technically
speaking but um it is selling into this 1750 to 1850 support zone which has been
held pretty much for the last year and a half so we'll see a lot
of stocks today i noticed uh we're doing that the main thing that concerned me about today's action
was really just the weakness in financials um i think the candle today on xlf was pretty horrific
i should just put a note about that in um in, in, uh, the discord, but, um, I don't mind
shopping markets.
I do begin to get concerned when the real economy sectors, um, get thrown out with that
action, right?
Like sell-offs in momentum or in tech don't bother me because those are high beta categories
that have gone up a lot, frankly,
in the last three years, basically in a vertical line. So weakness in those categories doesn't
really bother me. But when the weakness starts bleeding over to financials, that does start to
concern me. So that was the most concerning thing for me today about today's action. Um, and it's not necessarily, you know, uh, uh, it's all over signal, but,
um, it is something that we saw in early 22 as well. Um, when, you know, the market went into
a pretty significant correction for, for the duration of that year. So we still have a lot
of week left this week, but I think after last week's action, Friday was a decent day and, you know, looked like potentially recovery today.
And then we gave back most of that recovery, not most of it, almost all of it on most of the major indexes today.
And so that is concerning. So I'm I'm more so focused here, less on individual names and more so on the health of the overall market.
here less on individual names and more so on the health of the overall market and um it doesn't
look great uh you know i try to be as objective as possible and i'm always willing to flip my bias
but i try not to let my opinion get dragged by the narratives and more so just focus on the price
action and where the price action is weak and right now it is just broadly weak i mean even
if you look at some of the rotation we saw in the last
couple of weeks into areas like healthcare and staples, I mean, you had healthcare and staples
show a blip of green today. I actually think XLP is probably one of the better looking
major indexes, but it's not going to be enough. Healthcare and staples can't float the whole
market. Even if you get energy to participate with them, it's just not going to be enough. You know, I think in, in 22, we go back to rewind the clock to 22. I think that regime had a better chance of existing in 22 because the weightings and the major indexes were not as lopsided as they are now. Right? Like if you think back, and you don't have to think back too far for this,
but if you think back to the chat GPT moment,
since then, I think the majority of the Mag7,
at least the compute exposed Mag7,
have doubled.
Pretty much every tech stock that's touching AI
has gone up three, four, 500%. I'm talking about
the smaller ones. That's a big move and a big re-rating. And now a little bit of fear can lead
to a lot of multiple compression. And I think that's what you're seeing. And there's just not
enough market cap in healthcare or in energy or in staples to float that or to substitute that.
So that's kind of where my concern is starting to develop now.
I think in the last couple of weeks, I was just like,
oh, this is just a little bit of chop.
But now it's starting to seem like more than that.
Obviously, things can flip pretty quickly,
but this is not the type of action you want to see on the major indexes at all.
Um, this is not the type of action you want to see on the major indexes at all.
I mean, you have a, you have a NASDAQ that has now, uh, as of today's candle hit, what
is this?
One, two, three, four, five tests on the 21 EM declining 21 EMA and has been rejected
cleanly every time.
Um, that's not encouraging um now all that being said a lot can change in two
or three days um you know you could get very convincing reversal in price action um and it
wouldn't take a lot of time to do that but we need to see that pretty quickly because uh i mean anyone
who knows a single thing about reading charts can look at
the nasdaq chart right now and tell you that this looks like pretty clear distribution going all the
way back to october of last year um you know so that's three or four months almost five months
of just straight distribution on the major indexes and it's reflected on individual stocks too. If you look at
your favorite momentum names, or you look at pretty much any of the tech names, they've
participated in that selling as well, with very few exceptions. So I'm just being an observer here.
I'm not throwing any longs on the book, not throwing any shorts on the book at this juncture.
book, not throwing any shorts on the book at this juncture. But I am willing to reduce exposure
significantly if this action keeps up just to reduce volatility in the portfolio. I'm still
doing very well year to date. I mean, even after today's pullback, I'm still up 40% year to date,
which is, I think, a great return in just less than, but, um, I'm going to protect that, that capital as well.
So if, you know, the markets continue to act how they have been from a momentum standpoint,
um, I'm going to change my tune pretty quickly. So I would say I've gone from,
oh, this is chopped to this is now concerning, especially with the XLF candle today.
And then you have the geopolitical tensions in the background adding to some unpredictability. So it's not a clean environment to trade in
and not even really a clean environment, I think, to be a dip buyer in. So this is a
sit on your hands sort of environment, I think, for now, until the trend is decisively down.
Right now, the indexes are
doing their best to hold up.
Spy is doing a little bit of better job than the NASDAQ, but, um, that doesn't look good.
It doesn't look great.
And then that's, um, not what you want to see at this juncture, because obviously there's
plenty of room for more multiple compression and a lot of these names.
I think, um, we were talking about software earlier with Dan Niles,
just the weakness of software and this relentless selling.
I mean, IGV is back to, as of today's candle, or actually below, I believe.
Now, let me see, what is this?
Okay, well, no, not below yet,
but is back to within 20 cents of the April 2025 lows for software. Now, if we break down here,
if IGV continues to sell here, which I mean, I don't want to write that off, even though the
selling has been brutal, but if software continues to sell here, you break below those April 2025
lows without a sign of rebounding. That's a decisive um signal from the market that um they feel like it's a
little bit different than it was last year and keep my last year we didn't even have all of these
um agentic ai softwares and and sophisticated coding ai that are are creating this fear in
the first place right last year's sell-off in software was
just a sell-off with the rest of the market so and deep seek right it was the deep seek fears
that caused yeah and so now it's like it's a it's a different reason but it's it's also a
different macro environment it's a different geopolitical environment there's a lot of other
uncertainties on top of that so my eyes like i'm watching like a hawk. I'm watching IGV here at the $76 level.
You see a breakdown below 76 on IGV. That will be brutal. And I think it's going to drag down
the NASDAQ further with it. And then I'm also watching financials for some stabilization. I
mean, XLF sold below the 200-day moving average today. That's generally not a good signal for
markets. You can go back historically and look at when xlf is trading below the 200 day that's not a good signal for not only the stock markets
but it's not a good signal for the real economy either now there's quite a bit of overlap there
so pnc was down five percent today yeah mastercard visa like people read a sub stack today and just
sold everything yeah i understand mastercard visa but why is PNC Bank down 5% on no news?
That's bizarre.
I mean, dude, there were so many mega caps today that were down 5% to 6%
that I didn't think were related to the Substack piece at all.
But again, we're in a narrative-driven market.
we were in a narrative driven market we have been for the last three years i mean even if you go back
We have been for the last three years.
to deep seek last year like the deep seek sell-off led into the liberation day sell-off
a lot of it was narrative driven and within two or three weeks people were like oh the deep seek
thing isn't a big deal they had nvidia gpus and then markets rip roared back to the highs so
we are in a very narrative driven market i don't think anyone looks at this market and goes like, yeah, this market's trading on a fundamentally disciplined basis.
Not at all.
I mean, the short term leverage that we see in markets now, the zero DTE exposure, the higher level of retail participation, higher level of notional options exposure in general.
higher level of notional options exposure in general. I mean, I brought up this at a million
times, right? But zero to one DT options are 50, 55% of all notional options volume today.
Five years ago, people would have laughed in your face if you told them that. Five years ago,
that was 10 to 12%, right? So the notional exposure to short term options is five X. That's why you get market moves like this. And it's also why small bouts of fear or shifts in the narrative can create a huge cascade of selling.
And you add on top of that all of these leveraged ETFs that have entered the market, which, again, is a relatively new mechanism. Right. These three trying to bring back five X leverage. It's not even levered. I mean, it's not even new.
In 2008, they ruled out.
Actually, after 2008, they came out with 3x levered ETFs, like the FAS, triple short financials, and triple long financials.
And the SEC at that time said, hey, triple levered sector exposure is actually too risky for retail investors.
And these ETFs bleed out over time.
So they've ruled them out.
And now we're getting like 5X single name ETFs.
How is a 5X single name ETF more safe
than a 3X sector ETF?
It's not.
Mark, it's got bananas.
It's such a loophole.
I'd love to ask the Craneshows guys, Henry,
around that as someone who's kind of
participating in the space
and what you guys have seen in the SEC
and trying to play around with it?
Um, I think that 5x, 3x is too high.
Uh, we would never attempt something like that.
Um, I, I think that, um, you know, you've seen, well, we had a government shutdown,
a couple government shutdowns now right and you see this sec you know is not uh uh looking that closely at a lot of this stuff so i think a lot of people feel
emboldened oh you know that they can just file for something and and and they won't get um they
won't have an issue with the sec obviously i think they ruled out fiveX. We saw, I mean, as an issuer, we're always tracking filings.
We've seen filings for 3X, 5X funds, though.
And I think some issuers believe that with a more dovish laissez-faire SEC,
they could maybe get away with not get away with I
mean but but be able to do more that would have been seen as risky in the
past yeah yeah I mean yeah I agree with that point I think the big problem for
me is just like when you add higher retail participation which retail participation is at all-time highs in terms of percentage or
notional volume in the market,
you look at percentage ownership of stocks in U.S. households,
obviously at all-time highs,
pretty much goes to all-time highs every year.
1% cash in mutual funds, the lowest in years.
Yep. Short-term options exposure, all-time highs, zero DTE exposure. Saying that's at all time highs is like an understatement. It is five times above normal historical levels. Cracks in the real economy, geopolitical tension. There's just a lot of weight for the market to put on its shoulders right now and it becomes even more difficult to build a trend in an environment
like this because the washouts are horrific because you get you see people crying over
individual stocks down five or six percent a couple days in a row because they're in leverage
levered instruments right i mean you're taking a 10 or 15 drawdown on single stock common stock
equity shouldn't be a big deal but these people are not in single stock common stock equity they're mean three ever yes zero DT options
you get destroyed and then you have four selling margin calls you have levered ETFs that need to
be rebalanced which forces even more for selling yeah it's just it's tough it's time think about
the leverage that goes into even futures.
Right. And you look at futures and options on silver.
Silver and gold are now 40 trillion dollars of the global markets compared to, you know, U.S.
global equities at 100 trillion, of which U.S. is 70 trillion of that the lion's share.
You would think that, you know, Warren Buffett used to call gold the barbarous relic.
But now with the fear that people have around fiat currencies, it's gone parabolic. And with the silver move to 120 on the
China export ban on December 12th, you know, silver went to 120, then hemorrhaged down 30%
in a day. That's a six sigma move. Going back 13,500 trading days, you've not had a move in
silver like that in history, right? Arguably, it had
run up too much because of levered exposure. And this is basically now being replicated across
every single vertical. What's happening in crypto? 100 times leverage, right? Perpetual contracts.
What's happening with indices? You're having zero DT options. What's happening with tech stocks? People
are taking leap, leap exposure. So basically, everyone is focused on short term performance,
including hedge fund managers that are over indexed to tech, even European value managers,
right in Europe who can't catch up to the index have been heavy in MAG7.
And MAG7 is now going from free cash flow positive to free cash flow negative.
So what you're seeing is very small changes and fundamentals are getting magnified by
5 or 10x moves because companies themselves are overinflated.
They're overinflated because of the leverage in the system.
If SaaS stocks were not trading at 30 times cash flow or 60 times cash flow stock-based comp adjusted, the index wouldn't be down 25% since January.
And so the market was just overinflated to begin with.
And we like to say valuation is not a catalyst, but it is a risk marker.
So when markets are super inflated like this, you need to have some cash because any small thing, whether it's deep seek last year or a government shutdown, which shouldn't result in a big market sell off.
But it did. Right.
Most of the economy was still going. Right.
You see massive, massive risk on one.
Yeah, Henry? Yeah, if I may, you know, one of the things where we've been looking at is
the impact of, you know, because we look at China and China tech, and for years, you know,
you had US private equity pouring into China, And then that basically stopped after the pandemic, right? There's been almost very little private equity money investment from the United States into China.
Where has it gone?
It's all stayed here in the United States.
And that's great.
But I think that's also lent to higher valuations, just capital having nowhere else to go, really,
or perceptively nowhere else to go because of geopolitical tensions.
I think that's had an impact. And then also you've had just because the U.S. has again,
you know, beaten so many markets over the past few years, you've had a lot of European money,
other foreign money come come into the market. And now a lot of that's at risk because of the dollar. If you look at 2025, if you were a euro investor, you would have made maybe like 2% or 3% when you're considering repatriation back to euro.
Because the dollar was down 10%.
Right.
So that's causing – we're actually seeing this in the ETF flows, just people moving out of the US, people moving into other countries in terms of European capital specifically. And I think that's going to have an impact, right, on the markets and something to watch.
and something to watch.
It will be interesting to see how a lot of these teams,
also you were talking about their international versus the U.S.,
and even some of the teams that are working and being around the world.
I'm curious about your opinion on this, Craig.
Why do you think Riccardo Libre has struggled to perform an environment
where a lot of South American stocks have done really well?
Do you think there's a little bit of concern about the earnings,
or do you think it's just been a product of maybe concern about the consumer in South America? I think, honestly, there's probably
been a little bit of concern about the consumer, number one. Yeah, I think that's it. I think that's
a big part of it. And then, honestly, I think that it hasn't had support because I think everybody's
people are chasing the AI story, even in emerging markets where, and in many cases, that makes sense.
In China, that makes sense. TSMC, right, the chip makers, that's all well and good. And I think it's
hard for, people aren't telling this emerging market consumer growth story anymore. And I think it's hard for people aren't telling the story, this emerging market consumer growth story anymore.
And I think that's weighed on MercadoLibre. It's just been out of focus, I think, for investors.
I think they should do a stock split.
I definitely, yes, I certainly agree with that. Yeah, their stock is a $2,000 share.
I mean, it's, yeah.
That would amplify the moves and that stuff.
Because I think a lot of people are waiting for that
so that they can lever up with Mercado Libre.
But yeah, to your point regarding the consumer
being an issue from Mercado Libre,
I do agree.
But the raising rates also in South America,
especially in Brazil,
that's probably something that might have an issue.
I would think that the chair,
whatever the Brazilian central bank name is,
they recently changed the chair
and the guy favored capitalism.
He was promoting lower rate and everything,
but he had no choice to bring it up.
But now it's actually kind of interesting
that Mepada Libre, as opposed to Nubank,
is actually suffering from it. But it isre, as opposed to Nubank, is actually
suffering from it.
But it is probably, yeah, like you're saying, it's probably more of a consumer issue than
anything.
Because I think if it was an economic issue, you wouldn't see the ETF prosper like that.
So probably a lot of tech in there.
There's probably a lot of money unwinding from fund managers' books that they have no
choice but to kind of de-lever a little bit or
maybe take down risk in the markets and that's also going to be broad-based for Mercado Libre
since it's a very popular stock especially in America but to stock to stock stock's point that
chart is just terrible right now it's you get a lot of people seeing it fall down you know they
start to take down their risk in the portfolios, even retails as well, trying to buy the different software stocks and so on.
Like, the money's moving around pretty fast.
And like StockSock mentioned, I mean, this is going to amplify the moves up and down.
A lot of night catching, too.
I mean, you would have thought that it was going to be able to hold a 200-day moving
average around 19-something, but it hasn't.
but it hasn't and now it's lower yeah yeah i've been uh surprised by the movement as well so low i
And now it's lower.
struggle to find a really really compelling reason why it should be down seven percent
on the year um but they're like we said said, there's a lot of factors going on with this stock
in particular. The company itself is like, they're not a global company, they're only
in Latin America. But then in Latin America, they're not in every single country. So you
got to look at the countries they're in and how they're doing. Two of them are very volatile.
I mean, Argentina and Brazil, largest markets.
Brazil's been doing well.
I know there's been some anxiety around Malay's agenda being able to continue to increase spending and support the economy.
But, yeah, I think it's a challenging to point to one single macro indicator and say, okay, that's where Mercado
Libre is headed.
And I think a lot of it depends on the execution from the company itself, because they need
to continue to penetrate more markets.
There's absolutely no regulatory harmony between Latin American countries
as well, so that's always a headache
for them. But they've
been able to execute in the past, you know,
since they went public pretty well, so
I have great confidence
in them.
We are coming up here
on 40 Minutes of this conversation conversation and i do love talking these ones
like i said mercato libra earnings coming up tomorrow after the close there's that tweet
pinned up in the nest above a bunch of different products that crane shares have obviously a lot
of people know crane shares for kweb and other different stuff like that uh henry was talking
here about one that maybe i have to look in a little deeper, K-E-M-Q.
We have some different products here.
I appreciate you guys for joining in.
As people are checking that tweet up in the nest above,
as people go into the CraneShares website,
what are some things that people should kind of be on the lookout for,
stuff that you guys are doing,
anything you want to leave the people with on the spaces,
we appreciate you for joining in.
Everyone should make sure you're following that CraneShares account, but yeah.
Yeah, sure. Yeah, no, it's great to mention.
KMQ I think is a nice index to look at,
especially in the context,
we'll talk about MercadoLibre, it's large holding.
Then obviously there's a 2X KMLI.
So yeah, that's great on the product side. I think
China, mainland China, reopens from, they've had over a week of holiday. And over that holiday,
Trump's tariffs under Emergency Economic Powers Act have been struck down by the supreme court so i think when china opens tonight
uh i think it'll be very interesting to see uh what the markets over there do tonight um because
they haven't had they haven't been able to react to all that news um and so, I think that's something to watch. Just coming up in a few hours.
Hey, bang, check it out.
Check it out.
Coming up in a few hours.
Henry, I always love having you on these spaces.
If anyone has any questions,
obviously you guys can reach out to the Craneshears team.
We're going to have them back on as well.
So let me know, and I would love to ask them Henry's way.
Is there any topics? Obviously, we're a little more focused.
We're in some different directions, but for next time we do this,
is there something like you're excited for us to talk about as we're going
into, maybe I can prepare a little for,
maybe people can get excited for a conversation we'll have in the near
future.
Well, that depends on when we're going to be talking, Evan. I'm not sure,
but I'm more earning
i i'd love to do uh talk about p i think pdd is really interesting right now with the tariffs
uh uncertainty um i think that could be an interesting one i'm not i don't have it exactly
in front of me but um they should be reporting earnings relatively soon.
All right.
Come back with us, and you guys will see that one.
I am looking quickly.
My thing says Pinduoduo March 19th, but who knows?
That might be wrong.
A couple weeks.
A couple weeks.
Yeah.
We got some time.
All right.
Follow that Pay & Share account.
Follow the Stocks on Space account if you want to see that.
I appreciate everyone for joining in.
Like I said, we've been doing this every single Monday through Thursday,
3 to 5 p.m. Eastern, at least live, free.
We appreciate people like the CrainShare team for working with us,
helping support us, keep that vision, keep that drive,
allowing to create as much content for free forever.
And we got some cool stuff that we are excited about,
even some cooler, more interesting integrations,
which not quite at this moment ready to talk about,
but in the near future,
I have some stuff that I am excited about.
So I appreciate everyone.
Make sure you're following the speakers.
We will catch you all on the spaces,
same time, same place tomorrow.
Yeah, stock talk, unless there's anything you want to leave the people with,
rant the people with, I imagine you're going to the gym.
I don't know what we're working on in the gym today.
No, I'm moving this week, so I've got to just be moving stuff,
packing stuff.
Does the new place have a gym?
Yeah, of course.
Of course, yeah, yeah, yeah.
Of course.
You guys saw a steam room in there or no?
Yep. Big moves. All yeah. Of course. You guys saw a steam room in there or no? Yep.
Big moves.
All right.
I appreciate everyone.
There you go.
You never know what you've heard on these spaces.
Have a great one, everyone.
Shout out to CraneShares.
Shout out to Dan Niles.
Shout out to Scott Redler.
Shout out to the rest of the crew.
Once I close this down, entire spaces will turn into a recording,
and you guys can listen to the whole part.
Have a great one team.
Thanks doc talk. Thanks Sam. Peace.
Let's go.
