1 00:00:00,000 --> 00:00:02,300 Today on the Joseph Carlson showed the stock market 2 00:00:02,300 --> 00:00:05,700 continues its decline. It's now down three point six, 3 00:00:05,700 --> 00:00:09,300 seven percent for the S&P 500 over the past five days. 4 00:00:09,300 --> 00:00:14,100 The QQQ is down, 6.25 percent over the same time period. 5 00:00:14,100 --> 00:00:17,400 The fairing greed index which is a rough estimate of investor 6 00:00:17,400 --> 00:00:19,300 sentiment. Now is that a 13? 7 00:00:19,300 --> 00:00:22,400 Which is in the extreme. Fear category, investors are 8 00:00:22,407 --> 00:00:26,100 becoming increasingly concerned and for good reason, Bill 9 00:00:26,100 --> 00:00:27,900 Ackman. Recently did a tweet storm of 10 00:00:27,900 --> 00:00:29,600 how we're already in World War 3. 11 00:00:30,000 --> 00:00:34,100 Al's not 128 the highest it's been since 2008 and President 12 00:00:34,100 --> 00:00:37,700 Biden says that he's going to ban Russian oil imports so we 13 00:00:37,708 --> 00:00:40,200 have a lot of craziness going on in the market right now. 14 00:00:40,400 --> 00:00:43,900 We also have this popular graphic being shared around, all 15 00:00:43,900 --> 00:00:47,400 of social media, the surgeon Energy prices, suggests high, 16 00:00:47,400 --> 00:00:51,200 probability of a recession and the graphic shows that every 17 00:00:51,200 --> 00:00:55,600 time oil prices have gone up 50 percent which they just now have 18 00:00:55,600 --> 00:00:57,900 that is quickly, proceeded a recession. 19 00:00:58,000 --> 00:01:00,200 So I'll give you my thoughts on this and if I think, This is a 20 00:01:00,208 --> 00:01:03,300 true indicator of a recession. Now, we also have some other 21 00:01:03,300 --> 00:01:07,500 news that Disney plus is going to launch a cheaper ad-supported 22 00:01:07,500 --> 00:01:10,300 tear later this year to their service and I want to go through 23 00:01:10,300 --> 00:01:13,900 the benefits and the potential downside of Disney plus having 24 00:01:13,900 --> 00:01:16,800 an adverse in of their service. So as always, we have a lot to 25 00:01:16,808 --> 00:01:19,100 jump into in this episode a lot of ground to cover. 26 00:01:19,100 --> 00:01:21,400 If you like this type of content, you can subscribe to 27 00:01:21,400 --> 00:01:23,800 the channel and follow along with my progress for free. 28 00:01:24,100 --> 00:01:26,500 You can also check out the patreon, you get access to a 29 00:01:26,500 --> 00:01:30,200 Discord Community exclusive content and of course It's the 30 00:01:30,200 --> 00:01:34,300 qual trim software suite, which gives you the dip finder as well 31 00:01:34,300 --> 00:01:37,000 as qual term insides and dividend tracking software. 32 00:01:37,000 --> 00:01:39,200 That's all included under the patreon. 33 00:01:39,300 --> 00:01:41,800 All right now let's go ahead and start off looking at the market 34 00:01:41,800 --> 00:01:45,900 overall year-to-date, the S&P 500 is down 13 percent so it's 35 00:01:45,900 --> 00:01:49,000 well into correction territory headed towards a bear Market. 36 00:01:49,300 --> 00:01:53,300 The queue is down 20 percent year-to-date and it's well into 37 00:01:53,300 --> 00:01:56,700 a bear Market overall. So both of those major indices 38 00:01:56,700 --> 00:01:59,800 are in a correction or a bear market and the Dow Jones, the 39 00:02:00,000 --> 00:02:02,500 Last of the three has entered into correction territory as 40 00:02:02,500 --> 00:02:04,600 well. So all of these are headed down 41 00:02:04,600 --> 00:02:07,100 across the board. Stocks are going down and it's 42 00:02:07,100 --> 00:02:10,100 clear to me that investors are becoming increasingly fearful 43 00:02:10,100 --> 00:02:14,400 the fear and greed index on CNN. Now shows that investors are in 44 00:02:14,400 --> 00:02:18,400 the extreme Fair category and I think this is mostly accurate, 45 00:02:18,400 --> 00:02:21,900 from what I see investors are incredibly fearful no longer 46 00:02:21,900 --> 00:02:24,200 investors talking about this story of companies. 47 00:02:24,500 --> 00:02:27,200 Their total addressable markets, they're not talking about the 48 00:02:27,200 --> 00:02:29,600 Future Vision and growth of the company's there. 49 00:02:29,600 --> 00:02:31,800 Now just He's looking for places to not lose money. 50 00:02:31,800 --> 00:02:34,400 That's basically what every investors doing right now, 51 00:02:34,700 --> 00:02:36,600 they're not looking at the growth plans. 52 00:02:36,800 --> 00:02:39,200 They're looking at the defensiveness of every company 53 00:02:39,200 --> 00:02:41,600 they own. Is it going to be sold off more 54 00:02:41,600 --> 00:02:43,700 tomorrow? That's the biggest concern. 55 00:02:43,700 --> 00:02:46,400 Now, if we look at this gauge in historical context, I actually 56 00:02:46,400 --> 00:02:49,400 think it's pretty accurate. The fear and greed index showed 57 00:02:49,400 --> 00:02:53,800 that investors were extremely greedy leading up to March of 58 00:02:53,800 --> 00:02:56,700 2020. So, going into that time period, 59 00:02:56,700 --> 00:02:59,800 I remember that being the case I made videos. 60 00:03:00,000 --> 00:03:03,600 Sarcastically saying that the stock market is this magical 61 00:03:03,600 --> 00:03:06,800 money-making machine where you can buy any company and it will 62 00:03:06,800 --> 00:03:09,100 go up in price the next day. And that's exactly what was 63 00:03:09,100 --> 00:03:12,000 happening in late, 2019 and early 2020. 64 00:03:12,400 --> 00:03:15,300 Then of course, the 2020 pandemic happened sentiment 65 00:03:15,300 --> 00:03:18,400 quickly shifted from extreme greed, all the way to extreme 66 00:03:18,400 --> 00:03:21,800 fare during March of 2020. That's the point where this 67 00:03:21,800 --> 00:03:25,400 gauge got all the way to the worst reading in extreme Fair. 68 00:03:25,700 --> 00:03:28,600 Now, after this point the gauge has shifted back and forth 69 00:03:28,600 --> 00:03:31,300 somewhere between the two. Ooh, and it's normal radius. 70 00:03:31,500 --> 00:03:34,500 But now, it's starting to shift way back down into that extreme 71 00:03:34,500 --> 00:03:38,100 fear category my guess is this is going to continue with all 72 00:03:38,100 --> 00:03:41,400 the events unfolding right now. I can see this gauge going all 73 00:03:41,400 --> 00:03:44,200 the way back down to the very bottom of extreme fair. 74 00:03:44,300 --> 00:03:46,300 So that's the situation we're working with here. 75 00:03:46,300 --> 00:03:50,500 We know that the QQQ, the S&P 500 and even the Dow Jones are 76 00:03:50,500 --> 00:03:52,600 all selling off. All of them are now in 77 00:03:52,600 --> 00:03:55,800 correction territory. In the queue, is in a full-on 78 00:03:55,800 --> 00:03:59,500 bear market and it looks like it may continue on this way, unless 79 00:03:59,500 --> 00:04:02,200 we get some Really good news. We can see this with our 80 00:04:02,200 --> 00:04:05,400 portfolios as well. My portfolio over the past one 81 00:04:05,400 --> 00:04:08,700 week. Period is down 3.25 percent. 82 00:04:08,900 --> 00:04:11,800 So it's holding up a little bit better than the market better 83 00:04:11,800 --> 00:04:16,100 than the S&P 500 but I'm still down 11 thousand, one hundred 84 00:04:16,100 --> 00:04:19,200 dollars that's eleven thousand dollars in one week gone. 85 00:04:19,600 --> 00:04:23,600 Then if we look at the past month I'm down 7% That's twenty 86 00:04:23,600 --> 00:04:25,600 five thousand six hundred dollars gone. 87 00:04:25,800 --> 00:04:30,100 Then if we look at the past 1/4 the past, 90 days, I'm Down 88 00:04:30,200 --> 00:04:34,200 forty two thousand dollars forty two thousand dollars gone in a 89 00:04:34,200 --> 00:04:37,800 three-month period. So this is affected my portfolio 90 00:04:37,800 --> 00:04:41,900 like crazy looking overall, I used to be at gains of eighty 91 00:04:41,900 --> 00:04:43,700 thousand dollars three months ago. 92 00:04:43,900 --> 00:04:47,200 Now I'm at gains of 37 thousand dollars and if this selling 93 00:04:47,200 --> 00:04:50,500 continues, if the broad Market selling across-the-board, 94 00:04:50,500 --> 00:04:54,400 indiscriminate Lee continues on my portfolio is eventually going 95 00:04:54,400 --> 00:04:56,000 to go all the way back into the red. 96 00:04:56,200 --> 00:04:58,700 I have a little bit of buffer room right now, I'm still up to 97 00:04:58,707 --> 00:05:00,200 37 thousand. First. 98 00:05:00,500 --> 00:05:04,000 But if we go down another 12 or 13 percent, we could see my 99 00:05:04,000 --> 00:05:06,400 portfolio. Go back into the red overall. 100 00:05:06,400 --> 00:05:08,900 Now, this can be a little depressing to say the least, to 101 00:05:08,900 --> 00:05:11,800 see your gains vanish away. And just the order of a couple 102 00:05:11,800 --> 00:05:15,200 of months, to see this much loss over Justice time period. 103 00:05:15,400 --> 00:05:17,500 I think is very difficult to deal with for a lot of 104 00:05:17,500 --> 00:05:19,800 investors. I'm getting a lot of questions 105 00:05:19,800 --> 00:05:21,900 from different investors. Different people that are part 106 00:05:21,900 --> 00:05:24,400 of the community hair that are asking me questions. 107 00:05:24,400 --> 00:05:27,700 Like look, I invested in companies that I thought were 108 00:05:27,700 --> 00:05:29,500 good value, their great companies. 109 00:05:29,900 --> 00:05:32,200 They're all being sold off. I'm in the red on almost every 110 00:05:32,200 --> 00:05:34,700 single one of them. What do I do in this situation? 111 00:05:34,700 --> 00:05:36,600 And I think that's the most important question. 112 00:05:36,700 --> 00:05:39,900 What do we do in this situation? Now, to answer this question, 113 00:05:40,000 --> 00:05:42,300 I've gone through an outlined what I think are the most 114 00:05:42,300 --> 00:05:44,500 objective and reasonable options. 115 00:05:44,500 --> 00:05:47,500 We have available to us, these are the different things we can 116 00:05:47,500 --> 00:05:49,300 do with our money and our investments. 117 00:05:49,600 --> 00:05:51,400 The first thing is we could look at growth stocks. 118 00:05:51,700 --> 00:05:53,800 These are the companies that have been beaten down already 119 00:05:53,800 --> 00:05:56,000 quite a bit. Girl, stocks are a category of 120 00:05:56,000 --> 00:05:59,200 companies that are growing their revenue faster than other 121 00:05:59,200 --> 00:06:01,400 companies. So if their top line revenue 122 00:06:01,400 --> 00:06:04,400 growth is above 10 or 15 percent. 123 00:06:04,700 --> 00:06:07,000 That's probably in the growth stock category. 124 00:06:07,200 --> 00:06:10,200 If it's slower than 10%, it's probably no longer a growth 125 00:06:10,200 --> 00:06:12,700 stock. So, these companies are valued 126 00:06:12,700 --> 00:06:15,900 based on their future growth, not really their earnings or 127 00:06:15,900 --> 00:06:18,400 their profitability. And the problem with growth 128 00:06:18,400 --> 00:06:22,000 stocks right now is that interest rates Rising, make 129 00:06:22,000 --> 00:06:25,500 these companies, less valuable. So they get further and further 130 00:06:25,500 --> 00:06:28,600 discounted, and knowing that the feds going to increase interest 131 00:06:28,600 --> 00:06:31,600 rates in the future, Makes it so that the multiples these 132 00:06:31,600 --> 00:06:35,200 companies trade at is continually Contracting as a 133 00:06:35,200 --> 00:06:37,900 multiples, come down the price comes down. 134 00:06:37,900 --> 00:06:41,000 So even though growth stocks have been hit a lot already. 135 00:06:41,000 --> 00:06:44,100 They've came down and prices the multiple contraction may 136 00:06:44,100 --> 00:06:47,100 continue and they might continue to come down in price now. 137 00:06:47,100 --> 00:06:49,500 Of course, we could look at the other group of companies, the 138 00:06:49,500 --> 00:06:51,600 value stocks. These are companies that aren't 139 00:06:51,600 --> 00:06:54,200 growing their top line revenue as fast as growth stocks. 140 00:06:54,200 --> 00:06:58,100 So they might grow out less than 10% per year, but they do have 141 00:06:58,100 --> 00:07:00,900 higher amounts of earnings. And they have Our free cash flow 142 00:07:01,100 --> 00:07:03,200 that's typically what defines a value stock. 143 00:07:03,200 --> 00:07:06,000 NOW, value stocks have done better than growth stocks for 144 00:07:06,000 --> 00:07:09,600 the past six months, but the valuations of these defensive 145 00:07:09,600 --> 00:07:12,400 value stocks has actually gotten quite High, feel like the 146 00:07:12,400 --> 00:07:15,100 valuation of most of these companies, it's the highest 147 00:07:15,100 --> 00:07:16,900 they've been in the past five years. 148 00:07:17,000 --> 00:07:20,000 So a lot of the future prospects and defensiveness of these 149 00:07:20,000 --> 00:07:23,100 companies has already been largely priced in and if you 150 00:07:23,100 --> 00:07:25,500 pile money into am now, you might risk. 151 00:07:25,500 --> 00:07:28,800 Those multiples Contracting like growth stocks in the future. 152 00:07:28,900 --> 00:07:31,300 Now, outside of these girl, group of companies, we have the 153 00:07:31,300 --> 00:07:34,600 specific group of Commodities. This is the hottest trade right 154 00:07:34,600 --> 00:07:36,200 now. This is what every Traders 155 00:07:36,200 --> 00:07:38,200 doing. They're piling money into 156 00:07:38,200 --> 00:07:41,600 Commodities and you can see this reflected in the share prices 157 00:07:41,700 --> 00:07:43,800 ExxonMobil. For example, is the highest 158 00:07:43,800 --> 00:07:47,200 price that has been for the past five years, in just the past 30 159 00:07:47,200 --> 00:07:50,200 days, it's up 13 percent while the rest of the market stinking, 160 00:07:50,200 --> 00:07:51,900 and you can see the same thing with Chevron. 161 00:07:51,900 --> 00:07:54,500 It's the highest price has been in the past five years, the 162 00:07:54,500 --> 00:07:57,500 price is going parabolic, and there's a ton of momentum in 163 00:07:57,500 --> 00:07:59,700 this company. So the commodity trade, right? 164 00:07:59,900 --> 00:08:02,200 No, is working out well for a lot of investors. 165 00:08:02,300 --> 00:08:05,300 They're making money, buying Exxon, Mobil and Chevron. 166 00:08:05,700 --> 00:08:09,200 The issue I have with this trade is that there's a lot of day 167 00:08:09,200 --> 00:08:11,000 traders in it. There's a lot of momentum 168 00:08:11,000 --> 00:08:14,500 investors in it, not just long-term investors so the 169 00:08:14,500 --> 00:08:18,200 prices are being pushed up like crazy right now and eventually 170 00:08:18,200 --> 00:08:20,900 those momentum investors will move on to something else. 171 00:08:21,000 --> 00:08:23,700 And if you make the mistake of buying towards the top of the 172 00:08:23,700 --> 00:08:26,700 peak and momentum investors decide, it's time to move on. 173 00:08:26,900 --> 00:08:29,900 You could be hurt in this trade now after Commodities, we We 174 00:08:29,900 --> 00:08:32,299 could look at bonds, maybe that's an option but we know 175 00:08:32,299 --> 00:08:35,400 that we're going to be earning real negative returns with bonds 176 00:08:35,400 --> 00:08:38,799 so we might earn 2% on a bond and actually have five percent 177 00:08:38,799 --> 00:08:41,100 inflation. So we're losing three percent 178 00:08:41,299 --> 00:08:44,000 and of course with cash we just have it being eaten Away by 179 00:08:44,000 --> 00:08:46,200 inflation. We also have the option of 180 00:08:46,200 --> 00:08:50,200 trying to become a market timer selling, now exiting the market 181 00:08:50,400 --> 00:08:53,300 and hoping that we can get back in at a better time. 182 00:08:53,300 --> 00:08:55,700 And of course, timing the market in this way, I think is an 183 00:08:55,700 --> 00:08:58,500 ill-advised strategy that you're more likely to lose money by 184 00:08:58,500 --> 00:09:00,800 tying it incorrectly. Then actually timing it 185 00:09:00,800 --> 00:09:03,000 correctly. So overall, when I look at all 186 00:09:03,000 --> 00:09:05,100 the options here, none of them look great. 187 00:09:05,100 --> 00:09:08,000 In my opinion, this is kind of a situation where you can pick 188 00:09:08,000 --> 00:09:10,300 your poison. You can choose different options 189 00:09:10,300 --> 00:09:12,100 here. You can go different routes but 190 00:09:12,100 --> 00:09:15,700 I have left out one important option available to us and that 191 00:09:15,700 --> 00:09:18,300 is to do nothing. Do nothing, May in fact be the 192 00:09:18,300 --> 00:09:20,300 best option. If we go back to Terry Smith's 193 00:09:20,300 --> 00:09:23,900 investment letter, he summarizes his strategy in three different 194 00:09:23,900 --> 00:09:27,700 steps by good companies. Don't overpay and the third one, 195 00:09:27,700 --> 00:09:29,600 which he intentionally leaves in. 196 00:09:29,800 --> 00:09:32,500 As part of the three steps is to do nothing. 197 00:09:32,800 --> 00:09:35,600 And I think this is the one that investors really struggle, the 198 00:09:35,600 --> 00:09:38,800 most with their good at buying companies and I think a lot of 199 00:09:38,800 --> 00:09:41,000 investors are even good at not overpaying. 200 00:09:41,000 --> 00:09:44,100 They look at valuations, they look at PE ratios and price to 201 00:09:44,100 --> 00:09:47,600 sales and try to determine a good value for the company, but 202 00:09:47,600 --> 00:09:50,400 they struggle the most with the step of doing. 203 00:09:50,400 --> 00:09:54,100 Nothing sitting on your hands and doing nothing while watching 204 00:09:54,100 --> 00:09:58,200 gains vanish away is incredibly difficult and that can't be 205 00:09:58,200 --> 00:10:01,100 understated. This is The most difficult part 206 00:10:01,100 --> 00:10:03,000 of investing. And I think this is why 207 00:10:03,000 --> 00:10:06,000 investors like Carrie Smith have done really well, is because 208 00:10:06,000 --> 00:10:08,100 they're really disciplined and doing nothing. 209 00:10:08,100 --> 00:10:11,300 So my portfolio, that's the strategy that I'm following, I'm 210 00:10:11,300 --> 00:10:14,600 not doing the latest Trend. I'm not jumping from growth to 211 00:10:14,600 --> 00:10:18,300 value and value to growth going into Commodities, going into 212 00:10:18,300 --> 00:10:21,300 Cash, trying to time the market or doing, all of these things 213 00:10:21,300 --> 00:10:24,400 that have been proven time and time again to lead to inferior 214 00:10:24,400 --> 00:10:26,800 Returns. What I'm doing is buying good 215 00:10:26,800 --> 00:10:28,900 companies. In fact, I'd consider them to be 216 00:10:28,900 --> 00:10:30,000 great company. Knees. 217 00:10:30,300 --> 00:10:33,800 I'm not overpaying for them and then I'm sitting on my hands and 218 00:10:33,800 --> 00:10:37,100 patiently doing nothing. And that third step is very 219 00:10:37,100 --> 00:10:39,000 difficult. The pendulum swings from that 220 00:10:39,000 --> 00:10:42,100 greed to fear all the time. And I plan on waiting until 221 00:10:42,100 --> 00:10:45,400 investors become bullish again on this Market because this 222 00:10:45,400 --> 00:10:48,800 isn't going to be the end of it. The market isn't always going to 223 00:10:48,800 --> 00:10:52,200 be an extreme fear mode eventually at some point. 224 00:10:52,200 --> 00:10:54,800 It'll move all the way back up to extreme greed. 225 00:10:55,000 --> 00:10:57,100 That will happen again eventually. 226 00:10:57,300 --> 00:10:59,500 And that's the time when you should be taking gains and 227 00:10:59,500 --> 00:11:02,300 selling Out of positions, not when investors are incredibly 228 00:11:02,300 --> 00:11:03,900 fearful. So while this may not be the 229 00:11:03,900 --> 00:11:06,600 most exciting strategy that comes with the most drama. 230 00:11:06,800 --> 00:11:09,000 I think it's the best one for making money and that's what I 231 00:11:09,008 --> 00:11:11,600 plan on doing in the future. Now, moving on, we gotta jump 232 00:11:11,600 --> 00:11:15,200 into this news of Bill, Ackman the famous investor, now saying 233 00:11:15,200 --> 00:11:17,300 that were already in World War 3. 234 00:11:17,500 --> 00:11:20,800 We just haven't realized it yet. His reasoning for this is pretty 235 00:11:20,800 --> 00:11:22,400 simple. He says that even though we're 236 00:11:22,400 --> 00:11:25,400 not fighting Russia directly, the ukrainians are were 237 00:11:25,400 --> 00:11:28,700 supplying them with money were supplying them with weapons and 238 00:11:28,700 --> 00:11:31,500 we're doing harsh. Economic sanctions all across 239 00:11:31,500 --> 00:11:34,900 the world against Russia. So we're basically at war with 240 00:11:34,900 --> 00:11:38,000 them even though we're not directly boots on the ground 241 00:11:38,000 --> 00:11:41,000 fighting them and I think in that respect he's probably 242 00:11:41,000 --> 00:11:43,700 correct but I wouldn't really categorize this as world war 243 00:11:43,700 --> 00:11:45,800 three. What I have been astonished by 244 00:11:46,100 --> 00:11:50,600 is how unified all of the West has been in coming together and 245 00:11:50,600 --> 00:11:52,900 going against Russia. It's actually been pretty 246 00:11:52,900 --> 00:11:56,600 incredible to see every single major company that I track is 247 00:11:56,600 --> 00:11:58,700 pulling out of Russia. The latest to do it is 248 00:11:58,700 --> 00:12:01,400 McDonald's. Donald's will temporarily closed 249 00:12:01,400 --> 00:12:05,100 850 restaurants in Russia. Nearly two weeks after Putin 250 00:12:05,100 --> 00:12:07,700 invaded Ukraine. So even McDonald's is pulling 251 00:12:07,700 --> 00:12:09,700 out of Russia. You have companies like Netflix 252 00:12:09,700 --> 00:12:12,400 and Disney opposing Russia. You have Visa Mastercard 253 00:12:12,400 --> 00:12:15,200 implementing restrictions, we have sanctions across the board 254 00:12:15,200 --> 00:12:18,000 that are going to further cripple the Russian economy and 255 00:12:18,000 --> 00:12:20,700 the US and Europe are now saying that we're going to reduce the 256 00:12:20,700 --> 00:12:23,000 amount of oil that we import from Russia. 257 00:12:23,000 --> 00:12:26,000 So a lot of this is semantics is This World War 3? 258 00:12:26,100 --> 00:12:28,500 Well I don't really know. It depends on what you define as 259 00:12:28,500 --> 00:12:31,100 World War 3. Not fighting directly against 260 00:12:31,100 --> 00:12:32,700 Russia. But we're certainly sanctioning 261 00:12:32,700 --> 00:12:35,800 them offering resources to people that are fighting them 262 00:12:35,900 --> 00:12:38,700 and the unified West are doing a lot to damage their economy 263 00:12:38,800 --> 00:12:41,100 through the amount of companies being pulled out of Russia. 264 00:12:41,200 --> 00:12:43,900 And it seems like a lot of this may have been underestimated by 265 00:12:43,900 --> 00:12:46,300 Putin. Putin May argue that this is all 266 00:12:46,300 --> 00:12:50,100 going according to plan, and he had all of this baked in this is 267 00:12:50,100 --> 00:12:52,900 all expected. But I think that that assumption 268 00:12:52,900 --> 00:12:55,800 is probably ridiculous. I think Putin did underestimate 269 00:12:55,800 --> 00:12:58,800 Ukraine's resistance and I think he probably underestimated, the 270 00:12:58,800 --> 00:13:01,500 length that the West is Link to go to punish their economy. 271 00:13:01,700 --> 00:13:05,100 I really don't believe that this is all going to plan for Putin. 272 00:13:05,100 --> 00:13:06,900 I think a lot of this has backfired. 273 00:13:07,000 --> 00:13:10,000 He's now resulted that just bombarding cities, trying to 274 00:13:10,000 --> 00:13:12,700 reduce them to Rubble. They say that President Vladimir 275 00:13:12,700 --> 00:13:15,800 Putin could still reduce cities in Ukraine to Rubble. 276 00:13:16,100 --> 00:13:19,200 But European countries, say they are not as intimidated by 277 00:13:19,200 --> 00:13:22,100 Russian Ground Forces as they were in the past. 278 00:13:22,400 --> 00:13:26,100 So, in the vision of all of Europe, This is actually weaken 279 00:13:26,100 --> 00:13:29,300 their view of the Russian Ground Forces, they no longer view 280 00:13:29,300 --> 00:13:31,200 Russia. As ground forces as this 281 00:13:31,200 --> 00:13:34,200 Unstoppable army, they now view it as something that can be 282 00:13:34,200 --> 00:13:36,300 defeated. So Putin, in the eyes of his 283 00:13:36,300 --> 00:13:39,200 enemy has actually lowered the view and the respect that his 284 00:13:39,200 --> 00:13:42,700 army has by doing this for now. Of course this war has caused 285 00:13:42,700 --> 00:13:45,700 oil prices to go up. And now there's a lot of people 286 00:13:45,700 --> 00:13:50,000 predicting that the high price of oil will lead to a recession 287 00:13:50,000 --> 00:13:52,300 within the us. And this came about with this 288 00:13:52,300 --> 00:13:57,000 chart here, this chart shows all the way back to 1970, the price 289 00:13:57,000 --> 00:13:59,400 of oil and then highlighted in vertical. 290 00:13:59,800 --> 00:14:02,600 Lines a recession. So you get to see where the 291 00:14:02,600 --> 00:14:06,100 price of oil is, and where recession starts and as they 292 00:14:06,100 --> 00:14:10,400 Circle hair, every time oil has gone up over fifty percent 293 00:14:10,400 --> 00:14:12,700 inflation. Adjusted it is preceded, a 294 00:14:12,708 --> 00:14:15,100 recession. Not every single recession has 295 00:14:15,100 --> 00:14:18,700 started this way, but every time oil prices have gone this High, 296 00:14:18,700 --> 00:14:22,000 it has preceded a recession. So we see that pattern six, 297 00:14:22,000 --> 00:14:26,600 different times since 1970 and now we're in the same situation, 298 00:14:26,600 --> 00:14:30,500 oil prices inflation, adjusted have again gone up above. 50%. 299 00:14:30,500 --> 00:14:33,400 So the concern is, this might proceed another recession. 300 00:14:33,500 --> 00:14:36,100 Now these charts are interesting to look at, but ultimately, I 301 00:14:36,108 --> 00:14:37,700 don't think that they prove much. 302 00:14:37,700 --> 00:14:40,500 This doesn't mean that we have to enter into a recession. 303 00:14:40,700 --> 00:14:44,100 It's happened six times before. But there's a lot of times where 304 00:14:44,100 --> 00:14:47,900 we were just shy of that 50% Mark and we didn't enter into a 305 00:14:47,908 --> 00:14:51,100 recession, like just a couple years ago, we are about 49 306 00:14:51,100 --> 00:14:53,500 percent. So is this the perfect line that 307 00:14:53,500 --> 00:14:56,900 if we got two percent higher oil prices we would have entered 308 00:14:56,900 --> 00:14:58,600 into a recession a couple of years ago? 309 00:14:59,000 --> 00:15:01,000 I don't link. I think that this is just a 310 00:15:01,000 --> 00:15:04,500 rough gauge and something that we see crop up after the fact 311 00:15:04,500 --> 00:15:07,700 even the firm that put this graphic together, says quote, I 312 00:15:07,700 --> 00:15:10,900 don't expect an economic disaster but what we're seeing 313 00:15:10,900 --> 00:15:14,800 in oil prices will have significant impact on growth and 314 00:15:14,800 --> 00:15:17,900 I think that that's fair to say we also have few economists say 315 00:15:17,900 --> 00:15:19,900 that the u.s. is in danger of recession. 316 00:15:20,100 --> 00:15:23,200 Since the economy is underpinned by strong labor market. 317 00:15:23,300 --> 00:15:26,100 Solid consumer spending and better-than-expected corporate 318 00:15:26,100 --> 00:15:29,500 profits but many expect growth to slow further. 319 00:15:29,700 --> 00:15:32,900 ER, if inflation continues to rise, the war in Ukraine has 320 00:15:32,900 --> 00:15:37,000 injected further volatility into the markets, just as a Federal 321 00:15:37,000 --> 00:15:39,100 Reserve enters the rate hike cycle. 322 00:15:39,200 --> 00:15:41,400 They're saying there's a lot of volatility going on right now 323 00:15:41,400 --> 00:15:43,000 because of all the chaos going on. 324 00:15:43,000 --> 00:15:45,700 So Graphics, like this may be interesting to look at and you 325 00:15:45,708 --> 00:15:47,900 might be able to get a better gauge of when a recession is 326 00:15:47,900 --> 00:15:50,800 going to start. But even if you were able to 327 00:15:50,800 --> 00:15:54,500 accurately predict exactly when a recession starts, you're still 328 00:15:54,500 --> 00:15:56,400 not able to predict the stock market. 329 00:15:56,500 --> 00:16:00,300 In many cases, the stock market doesn't trade down, Chloe with 330 00:16:00,300 --> 00:16:02,900 the recession and back up with the recovery. 331 00:16:03,100 --> 00:16:06,400 A lot of times it dips down before the recession starts and 332 00:16:06,400 --> 00:16:08,300 starts to recover during the recession. 333 00:16:08,700 --> 00:16:10,600 They're not always perfectly correlated. 334 00:16:10,600 --> 00:16:13,500 So trying to time this type of stuff I still think is a losing 335 00:16:13,500 --> 00:16:16,100 game now. Lastly we have a strategy change 336 00:16:16,100 --> 00:16:20,000 in Disney with Disney plus so far their service has been where 337 00:16:20,000 --> 00:16:23,300 you sign up and just like Netflix you have no ads, you pay 338 00:16:23,300 --> 00:16:26,400 a certain amount every month and you get access to their library 339 00:16:26,400 --> 00:16:28,400 of content. That's constantly updated. 340 00:16:28,600 --> 00:16:32,600 But now Disney has Decided to add in a cheaper ad-supported 341 00:16:32,600 --> 00:16:34,500 care to their subscription options. 342 00:16:34,800 --> 00:16:37,500 So you'll be able to choose between paying more and having 343 00:16:37,500 --> 00:16:41,000 no ads or paying less and having ads in the mix. 344 00:16:41,100 --> 00:16:44,200 Now, I have some thoughts on this and the strategy change, 345 00:16:44,200 --> 00:16:47,300 and I want to see if you notice the type of companies that are 346 00:16:47,300 --> 00:16:50,500 adding in the ad-supported tears, let's go ahead and read 347 00:16:50,500 --> 00:16:52,700 through some of them that are doing this HBO. 348 00:16:52,700 --> 00:16:56,100 Max last year, introduced a ten dollar a month plan that shaved 349 00:16:56,100 --> 00:16:58,000 five dollars off of the ad free Price. 350 00:16:58,400 --> 00:17:01,300 Although in addition to adding Commercials the cheaper plan. 351 00:17:01,300 --> 00:17:04,700 Also is limited to HD content, not the 4K. 352 00:17:05,099 --> 00:17:08,500 Peacock is another one. It takes a more varied approach. 353 00:17:08,500 --> 00:17:12,300 A smaller selection of content with ads is available for free 354 00:17:12,500 --> 00:17:15,800 with a $4.99 per month. Tear that offers the full 355 00:17:15,800 --> 00:17:18,800 library with ads, and then there's the 10 dollar plan for 356 00:17:18,800 --> 00:17:20,800 peacock. That allows customers to 357 00:17:20,800 --> 00:17:25,000 download titles to watch offline and get rid of most, but not all 358 00:17:25,000 --> 00:17:27,900 of the commercials. So peacock has the most varied 359 00:17:27,900 --> 00:17:29,900 approach. They have three different Tears 360 00:17:29,900 --> 00:17:32,800 with ads, and no ads and everything in between and even 361 00:17:32,800 --> 00:17:36,800 Hulu, which Disney now owns and operates offers an ad-free and 362 00:17:36,800 --> 00:17:40,600 advertisement supported version Hulu with commercials is seven 363 00:17:40,600 --> 00:17:44,000 dollars a month, the ad-free version is $13 per month. 364 00:17:44,000 --> 00:17:46,100 So there's a lot of streaming companies that are taking this 365 00:17:46,100 --> 00:17:49,800 approach of having a mixture of ads and no ads in their 366 00:17:49,800 --> 00:17:52,700 services, they have varied approaches and doing this in 367 00:17:52,700 --> 00:17:55,100 varied strategies. And the reason that they do 368 00:17:55,100 --> 00:17:58,800 this, of course, is because it raises that ARP. 369 00:17:58,800 --> 00:18:03,400 You that Average revenue per user, introducing ads increases, 370 00:18:03,400 --> 00:18:05,700 the average revenue per user by a lot. 371 00:18:06,000 --> 00:18:10,500 For example, peacock with their free tear, the completely free 372 00:18:10,500 --> 00:18:14,900 tear has an average revenue per user of around $10 per month. 373 00:18:15,300 --> 00:18:18,500 They load you with so many ads. When you're watching this, that 374 00:18:18,500 --> 00:18:21,000 they're still making $10 per month off of you. 375 00:18:21,300 --> 00:18:24,000 So, that's the reason they charge ten dollars per month for 376 00:18:24,008 --> 00:18:26,300 their premium version. Just so that they can have the 377 00:18:26,300 --> 00:18:28,900 same amount of average revenue per user that they do with the 378 00:18:28,900 --> 00:18:31,300 free tier. And I know that Disney's looking 379 00:18:31,300 --> 00:18:35,000 at peacock and saying, wow, they're getting $10 per month 380 00:18:35,000 --> 00:18:37,300 per user just with the ad Revenue. 381 00:18:37,500 --> 00:18:39,800 That's so much money on a per user basis. 382 00:18:40,100 --> 00:18:42,000 Maybe we should allow that option as well. 383 00:18:42,400 --> 00:18:45,600 So Disneys, following peacock, and HBO, and all these other 384 00:18:45,600 --> 00:18:48,100 companies with this strategy, do you notice the group of 385 00:18:48,100 --> 00:18:51,600 companies that have so far been unwilling to follow this ad 386 00:18:51,600 --> 00:18:53,700 Revenue model? Netflix is one of the few 387 00:18:53,700 --> 00:18:57,500 companies that only offers options for streaming that don't 388 00:18:57,500 --> 00:19:00,100 include ads. They have no add Model. 389 00:19:00,500 --> 00:19:05,100 Another one is Apple TV. + Apple TV + only has the option to have 390 00:19:05,100 --> 00:19:07,400 ad free. They will not include ads on 391 00:19:07,400 --> 00:19:09,000 their service or at least they haven't done. 392 00:19:09,000 --> 00:19:12,600 So, so far and the other one is Amazon Prime video so far. 393 00:19:12,600 --> 00:19:14,600 They don't have ads included in their service. 394 00:19:14,800 --> 00:19:17,400 The big differentiator, I noticed between these two groups 395 00:19:17,400 --> 00:19:21,100 of companies is all the ones that are embracing an ad version 396 00:19:21,100 --> 00:19:24,100 of their platform. Are all the traditional cable 397 00:19:24,100 --> 00:19:25,800 companies. These are all the Legacy 398 00:19:25,800 --> 00:19:28,300 companies. Embracing their legacy model 399 00:19:28,600 --> 00:19:32,400 peacock is From Comcast, they're happily embracing ads. 400 00:19:32,500 --> 00:19:36,300 We have now even Disney a legacy company embracing ads with both 401 00:19:36,300 --> 00:19:39,900 Hulu and now Disney plus. And we have HBO Max of course 402 00:19:39,900 --> 00:19:42,500 with AT&T and bracing ads on their services. 403 00:19:42,500 --> 00:19:45,900 Well, all of them in varied forms are embracing ads while 404 00:19:45,900 --> 00:19:48,800 the tech companies. The newer companies like Netflix 405 00:19:49,000 --> 00:19:52,300 Amazon, Prime, and Apple tv plus so far. 406 00:19:52,300 --> 00:19:55,000 None of them are really embracing this ad model and I 407 00:19:55,000 --> 00:19:57,200 think that's an important distinction to make the reason 408 00:19:57,200 --> 00:19:59,500 that the average Netflix user watches for over. 409 00:19:59,600 --> 00:20:02,300 Hours per day, probably has to do with the fact that they have 410 00:20:02,300 --> 00:20:05,200 not embraced an ad version of their subscription. 411 00:20:05,200 --> 00:20:07,900 They refused to do so. So their engagement stays 412 00:20:07,900 --> 00:20:11,200 incredibly High because you have no reason to disengage you go 413 00:20:11,200 --> 00:20:14,200 from one episode to the next with no ad breaks in between. 414 00:20:14,200 --> 00:20:16,800 So overall, I think this will be a good thing for Disney in the 415 00:20:16,800 --> 00:20:18,800 short term. I think that in the short term, 416 00:20:18,800 --> 00:20:21,100 they'll have a higher average, revenue per user. 417 00:20:21,300 --> 00:20:22,700 So Disneys going to make more money. 418 00:20:22,900 --> 00:20:24,700 And I also think that they're going to gain subscribers 419 00:20:24,700 --> 00:20:27,700 quicker, having the dual options, but in the long term, I 420 00:20:27,700 --> 00:20:29,300 see a potential downside to this. 421 00:20:29,600 --> 00:20:32,300 Having an adverse in of a streaming service is kind of 422 00:20:32,300 --> 00:20:35,000 like trying to just remake cable TV on the internet. 423 00:20:35,200 --> 00:20:37,200 And I don't think that's exactly what people want. 424 00:20:37,300 --> 00:20:40,900 And I see this actually as a potential for Netflix and Apple 425 00:20:40,900 --> 00:20:44,900 tv plus and Amazon Prime to differentiate themselves from 426 00:20:44,900 --> 00:20:46,900 all these cable Legacy companies. 427 00:20:47,200 --> 00:20:50,200 While they're all going into the ad-supported revenue streams, 428 00:20:50,400 --> 00:20:54,000 the services with Netflix and Apple tv plus, and Amazon Prime 429 00:20:54,000 --> 00:20:55,500 probably stand to benefit from it. 430 00:20:55,500 --> 00:20:57,800 So, that's all for this show. I'll have more content out this 431 00:20:57,800 --> 00:21:00,000 weekend, so if you haven't already, hit the Subscribe 432 00:21:00,000 --> 00:21:01,700 button and you can follow along for free.