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

Will euphoria return to big tech? Great question. In a number of cases, they've been ingrained in economies. Larger tech benefits from positive secular trends. Ultimately, there's a lot of money pouring in through passive means. Nothing to show a change to this, so we'll see new highs on those names.

When Trump tweets something that causes the market to go down, it's a mistake to sell (i.e. kieboshing stiumulus). Why? Trump will follow with a tweet that reverses himself (sort of), like today, which caused markets to rebound. Meanwhile, Democrats again announced that they want to break up the monopolies of mega-cap tech companies of Facebook, Apple, Google and Amazon. He's not sure that they are monopolies. Rather they have created industries full of small companies. Our economic system needs competition. Also, these tech titans are America's pride. Also, they support small business. How does a small business advertise cheaply? Buy ads on Facebook and Instagram.

Is today the time to buy growth stocks? Any time is. No matter the macro, there are companies but you have to look now with a fine-tooth comb. The velocity of money speaks to how often a given dollar circulates through the economy. Say he gets haircut and that barber buys groceries and those dollars are spent elsewhere. Now, that money is circulating is declining (less), so GDP will increase less. We won't see inflation until the velocity of money picks up. US government bonds are a safe haven and the price of them bid up in times of distress. Because stocks are strong, we're seeing a back-up in bond yields. He expects yields to go lower and even negative yields during the next period of economic weakness.

Yesterday's rally wasn't sustainable. Today, Trump axed the stimulus talks and markets slid. It's a crushing disappointment for all who lost a job or business during Covid, especially in hospitality. Investors are disappointed; markets thrive on liquidity. US Fed's Powell wanted more stimulus. Cramer thinks Trump is taking a calculated risk, seeing a V-shaped recovery. Can small business and travel hold on for another month when Trump says he will resume talks? Small businesses are suffering, but those don't show up on the stock market, which Trump closely watches. Sectors that are thriving are seeing a V-shaped recover, including tech and home-builders. That said, we need stimulus now.

"Stick to stocks," he often sees on Twitter. But now you can't divorce politics from the markets with the election around the corner. You must watch politics. For example, Trump loves fossil fuels, so he urged viewers to sell, sell, sell oil because Trump's approval would flood the market with oil, and it did. Politics and medicine are driving the market these days--including today when Trump cancelled stimulus talks.

The stock market doesn't work today without the stimulus from governments. Without the stimulus, we are in the worst depression since the 1930s. The headlines for stimulus bills around the world are coming out daily.

Biden presidency. The street research says that election night certainty will be bullish. Taxes and stimulus money will be different between Trump and Biden. Once the uncertainties are settled, the markets will be bullish. However, Berman is sceptical that Trump will go down quietly.

The monumental amount of debt has been growing for decades. The last time we had this much debt was during the great depression. The natural rate of growth has never been lower than today. There is a growth dynamic problem and the math doesn't work. Inflation could be a solution to deal with debt but he sees more stagflation.

Gold. It is the traditional money and it moves for various reasons. Historically, it has moved relative to real yield. The yield has stalled out at a big negative. In order for gold to go up, the real yield needs to get more negative, or move in that direction. Gold struggles when you can get positive return from bonds.

U.S. Dollar. The US dollar will remain the reserve currency for the immediate future. As long as the world is trading goods in US dollars, it will continue to hold this status.

Educational Segment. The stock market needs a stimulus bill. If Trump wins, then the stock market could see a growing market, and if Trump loses, then the stock market could fall according to metrics. If there is no stimulus bill pre-election, we will see a weaker market too. It is a hot political issue. An incumbent loss in the white house will be detrimental to the stock market.

Market. There is COVID-19 in the White-house. There is a chance of a deflationary shock in the short term. If anything were to go wrong, then the US$ would soar. Investors should look at what equities they have in US$. If we get that deflationary shock… your portfolio will survive in the forth quarter. What's driving the market now is headlines. It wants to judge if we are going into a deflationary shock or do we go into hyper inflation. Technology is a hedge if we go into seriously bad news. He would be balanced, diversified, holding a lot of US$ and let's see what happens. He thinks a stimulus package is critical. He thinks it will get passed.

Gold. He distrusts it as these levels. It is the only mistake recommendation in 21 years. This includes the gold companies.

Where to put RESP money. He would be tempted to include GOOG-Q. Even if they get broken up, the smaller companies would do well.