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Janney Montgomery Scott Chief Economist Mark Luschini and Raymond James Financial Head of Fixed Income Kevin Giddis on where to invest in the current ...
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Let's -- -- mark machining and Kevin against mark I wanna start reviewing let's start with apple talking about -- it looks like it's getting close to be -- under 600 is -- a five.
Well David if you look at it on -- valuation basis it does look relatively inexpensive especially when you peel out the cash that apple is sitting on its trading at.
-- double digit -- upper single digit multiples in addition to that is generating enormous -- free cash flow.
And we know that -- in a product cycle that continues to have a cult like following.
Among people who are willing to step up and by the iPhone 5 and probably will line up once again.
For the iPad many so as a consequence.
You have to think if it continued to deteriorate from here.
You would find a rotation back to value investors started take a peek at apple when they were reluctant to do that when it was over 700 dollars a share.
Let's bring in captain because he's not an equities guy is a fixed income guy you're probably looking at us -- say get a white guys say get a hold of balled up about what's going on an equity land because -- opportunities in fixed in -- -- I'm assuming you're not gonna -- treasuries here.
-- list that -- -- we kind of referred to the wind market index when we look at the bond market.
The louder the wine market is in the equity market the better it is for bonds shows so there's a lot of whining going on the -- -- -- that -- good day for bonds but.
It generally that I sound like a broken record time stood still like the Muni market -- a little bit of the corporate bond market so.
With -- but whether -- be tax free or taxable Munis.
You get done better than expected yields.
You take less credit risk that it then be in in the corporate bond market.
And -- and it just a great time to invest because taxes.
At best are gonna stay the same for some likely going up from most so I still like -- -- without market in a lesser degree I do like the corporate bond market this because yields are a little bit better.
Mark you know we -- bad economic news or some some bad economic news -- That's -- for the longest time our market was was hanging on every word of the Federal Reserve you know is are gonna be another stimulus what way how many MMS NBS -- are they gonna buy today -- -- It seems now the market is worse -- focus on the fundamentals of the economy.
Rather than currency manipulation by the Fed in my right on that.
-- your excellent all right David we've been -- now for the last couple weeks that we've had QE so those that have been liquidity addicts have gotten.
Their -- but now we need to see in order for equity prices to move substantively higher from here economic validation.
And frankly over the last 234 weeks we've gotten some of that ISM readings above the boom bust line.
Better than expected news on housing certainly auto sales retail sales.
So there's been an amalgamation of I think news that has been slightly better than consensus that I think is indicative of why equity prices have held in even while earnings have begun to be a little bit disappointing.
So let's talk about some of the things -- what market you like J&J and you also like ConocoPhillips and PNC as a financial -- what.
Which one and all of these has the best opportunity.
If the outlook its worst.
Locally.
If the outlook worsens globally listing you wanna go with the company with the biggest -- and that would be Johnson & Johnson one of only four triple A rated companies America.
Fortress balance sheet 3.4 percent dividend yield.
You know -- history of continue to raise their dividend regularly twenty years consecutive plus 11% annually over last five.
So that would be the one that I would go with as a defensive play if you wanted to -- offset that was something more pro cyclical that's when you go to energy and or financials.
We want to bring in somebody who was actually there we talk a lot about what happened and 87 -- I was covering -- -- that the -- at the Wall Street Journal but Teddy Weisberg was actually very here.
During the 1987.
Crash and he he joins us now to join in the conversation.
Teddy was there any worry in the back here by what you started to see the double digit losses today that -- here here we go again another 1987.
Well no because the one thing unfortunately that we becomes kind of immune to.
Is that we and the last 45 years because of the way markets change maybe more -- trading I'm not quite sure what the -- -- But -- get these -- hundred down hundred up 200 down 200 days and they come along pretty regularly.
Where we you know you could go a whole year without a hundred point move and a market.
Now we seem to get them almost every other week -- they -- up or down so unfortunately I think we all become a little complacent to the volatility.
Of.
But Citi you know and we've got Kevin -- here's a -- -- for -- to play an -- they're looking back at -- fixed income held up during that time what did you see there -- you just so focused on people selling hundreds of thousands of shares of some of the -- -- -- -- Yeah you know I happen to be in the business happen to be negotiated need an employment contract on that day -- I.
Well did you get decide if if they -- show the pieces of paper across reasons -- -- we don't care so.
The way I remember -- all too well but.
Keep in -- we went to our own futures you know limit up limit up limit up on prices.
At that time so will with -- each dip of the equity market came.
High levels of price appreciation in the in the fixed income markets.
And it changes forever so it was quite up a busy time in fact you couldn't get shorts out for many many days after.
I got as steady where do we go from here by friends -- now I mean at all -- -- where we are today.
You know half.
I've been that kind of not a soapbox and nobody's that nobody cares to listen almost going back to the first court alleges -- this over and over again.
For whatever reasons investors.
Have been completely ignoring the negative guidance we've been getting from -- -- a lot of high profile US companies.
And now it's sort of coming home to roost.
I'm not suggesting that we're gonna throw the baby out -- advance warning here.
But clearly.
That needs it -- we're gonna have a difficult third quarter earnings period and I think it could continue perhaps in the fourth quarter and now we got an election coming in a couple of weeks.
I think a lot we'll have to do with the who the next president is and when and where we're going and and that's a scenario that -- can be -- very positive short term -- I think very negative do not.
Ignore this man's advice he has been around for many it turns in the market Teddy great to see a thank you for companies that going to -- appreciate and -- -- Cheney and Kevin Guinness.
Thank you so much we appreciate -- -- Mark -- we're gonna check in with you and just.
Couple of minutes as they close the S&P futures.
Thanks guys the presidential debate.
