A Comment -- General Comments From an Expert (A Commentary)

No. His firm probably had anywhere between 5-10% of holdings across separately managed accounts and through his fund. They've taken a bit of $$ off the table, bringing the weighting down to ~5-8%.

They've taken that money and put it into those industrials, financials, healthcare, etc. that they know are using AI. That's different for his team from the last 3 years, but they think it's the right way to go.

He was going to say that he was hoping this drawdown would happen because he didn't have enough of the memory stocks (like MU, SNDK, SK Hynix). This gives you the chance to return to the scene of the accident and pick them up.

The last few months have really been mixed, with a confluence of geopolitical issues and other headwinds. Markets had a pretty good rebound off the April lows of last year, but haven't really been able to find a clear direction.

There's now a consolidation phase before, hopefully, the next run up. A necessary evil. Though not specifically what we want for US markets right now, it probably makes the next leg go higher. 

His team expects market movements as high as 7400, maybe by the end of April. Perhaps 8000 by the end of the year. This is an optimistic scenario, where good things need to happen and some geopolitical issues need to get sorted out.

It'll be a volatile year, and volatility leads to opportunity. Perhaps more of an active market than last year.

Yes, he expects more than 1 cut this year. Depending on how the nomination for Fed chair goes he expects a minimum of 2, but probably 3, cuts. 

Thinks economic growth is slowing down. Tariffs and other things do end up hurting the consumer. Later in the year, economic data may be a bit lower than people thought, and that might pave the way to another rate cut beyond what's currently priced in. 

Mixed bag. Some of the high flyers such as AMD are trading down today. Certain stocks are priced to perfection. They may not have had a bad quarter, but sometimes there's profit-taking or rotation out of certain investment types. That's just part of the market.

You can take advantage of your high flyers, repurpose that capital throughout the year and, hopefully, buy low and sell high :)

You have to be careful. Very rarely are there Sell positions on them. You have to look at a company and decide if you like it, perhaps using analyst ratings to help you make that decision. There can be other vested interests in those ratings. So don't rely on them too much.

He can't :)  The reason is that he's not a big fan of the preferred share market. You take all the risk of an equity market, yet funds often trade at a discount to NAV. That market hasn't been super-kind to investors.

For income he'd rather own a pure dividend play, through either individual stocks or an ETF. If you want enhanced income, look at some of the covered call ETFs.

Frankly, the bond market's been tough. Some things that traditionally were supposed to drive the bond market higher haven't really worked as well as expected. Right now there's a disconnect between using bonds to diversify and the income generated from them. With interest rates having come down, he'd have expected better performance.

Instead, try looking for alternative income sources to see if there's a better play out there than just a traditional bond fund.

Like last year, 2026 is volatile. Some big companies are up or down 15%. January looks like markets were up 0.5%, but the real story is that there was lots of speculation and whipsawing. You have to be a long-term investor. The market valuation is a little higher than average, nothing terrible. There are companies worth buying now for the long term. Sectors he's picking away at: financials, real estate and industrials. In tech, he's holding onto Meta and Alphabet.

The narrative to explain all that points to the potential appointee (Kevin Warsh) to The Fed, and we'll have to see if he gets confirmed. People are trying to figure out what his regime would look like. Is he going to focus on inflation, or is he going to cut interest rates like crazy to satisfy the US administration?

If he focuses on inflation, that might be good for the USD but bad for gold and bitcoin. Things change so quickly, you can't draw a blanket conclusion and apply it to a Fed appointee over the next number of years.

For sure. Of course, macro's always on our minds. Macro stuff will come and go. In the short term he doesn't care what anyone's predictions for gold or interest rates or inflation are. Most people are wrong anyway.

He always tells clients that you have to figure out what type of investor you are. At his firm they're long-term, Warren Buffett, Peter Lynch-style investors. Focus on owning great-quality companies that offer some reasonable certainty that they'll be selling more of a product or service in the next 3-5 years.

There have been huge reactions to lots of stocks where there's been no impact on earnings, but the narrative is driving the story. The market's forgetting the most important thing when it comes to investing -- it's the mathematics of future cashflows. For example, MSFT reported last week with no indication of software being disrupted, yet the stock sank. 

When stocks report earnings, you never know what the reaction is going to be. He's going to keep focusing on company results. Not conjecture, not what someone says on X.

Fact is, we should feel pretty good about markets heading into 2026. Corporate earnings are extremely strong, with another year of probably double-digit earnings growth. Interest rates have come down a lot. Inflation seems to be pretty tame. What more do you want?

There's an advantage to owning companies that have already built up billions of customers, such as AAPL, MSFT, V, or AMZN. Especially when they have such strong goodwill from customers, and they keep adding products and services. 

In this day and age we don't know what's going on with AI, and the consumer's really frightened about how the world's going to look. You want to stick with companies that have the best brands, best distribution, and best marketing that you can trust.

He expected the gold correction, and the downside could last months or years. In 2011 or 2012, gold peaked at $1,900 and it took more than a decade to return to those highs. Gold could go higher, but it could easily correct again. Gold's 200-day moving average is around $3,700 now, and we'll probably test that. Don't buy today, but wait.  He doesn't expect to return to the highs for a while. Kevin Warsh was probably the best choice as new US Fed Chair, and the market felt some relief with that choice though have we solved the US debt issue? His historic views have been critical of the Fed, but he expects these to come. Among this week's earnings, he's watching Google and Amazon and what they will say. What Microsoft earlier said about the cloud and Azure is partly why MSFT shares are down. If Amazon said the same thing, that could trouble the broader markets. Tesla is an example of shareholders punishing a company for not saying what they want to hear (phasing out some EV car models and focusing more on self-driving cars).

Great question that applies to probably 50% of the show's viewers. Regulators won't allow him to answer the question, but he strongly suggests hiring a professional advisor.