Smart Investing with Brent & Chase Wilsey

Brent & Chase Wilsey
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Smart Investing is the radio show where Brent and Chase try to make investing easier to understand. They demonstrate long-term investment strategies to help you find good value investments.

  1. 20h ago

    June 5th, 2026 | What's Fueling the Tech Rally? Car Sales Are Down, May Jobs Report, Return on Homeownership & More

    Where is the money coming from that is fueling this technology rally? No one knows for certain, but there are some concerning signs that suggest many investors may not have the cash to support their positions and are instead relying on borrowed money to drive the rally higher. One metric we continue to monitor closely is margin debt, a potentially dangerous tool that has now reached record levels. Margin debt hit a record $1.304 trillion in April, an increase of 6.8% from the previous month. On a year-over-year basis, margin debt surged 53.3%, highlighting the growing use of leverage in the market. Looking at US margin debt as a percent of real GDP, it just hit 5.2%. According to FINRA data that is an all-time high and during the dot-com era it was around 2% - 3%. The risk with margin debt is that when stock prices decline, investors may receive a margin call requiring them to deposit additional funds into their accounts. If they are unable to meet that requirement, their broker can automatically liquidate positions to cover the shortfall. While margin rules vary based on several factors, you could be in hot water if your equity drops more than 25%. With margin debt at such elevated levels, even a modest setback in the semiconductor or broader technology sector could trigger a chain reaction of forced selling as investors scramble to meet margin calls. Some investors may choose to exit positions before receiving a margin call, particularly if they become uncomfortable with the amount of leverage they have assumed. In those situations, emotions can accelerate selling pressure and amplify market volatility. Technology and semiconductor stocks are already trading at elevated valuations. Adding substantial amounts of borrowed money to an already expensive market increases the risks and leaves investors vulnerable if market sentiment shifts.   Car Sales Are Down, and I Think That's a Good Thing In 2019, consumers in the United States were buying roughly 17 million cars and trucks each year. This year, vehicle sales are expected to reach only about 16 million. Many consumers complain that new-car prices are simply too high, with the average new vehicle now costing around $50,000. Currently, only about 25% of new vehicles sold in the U.S. are priced between $25,000 and $35,000. I believe this trend is actually a positive development. For too many years, automakers focused on producing as many vehicles as possible in an effort to gain market share. In the long run, this proved to be a poor business strategy. Over the years, several manufacturers required government bailouts, while others filed for bankruptcy, hurting shareholders, creditors, employees, and communities. Of course, consumers benefited from this excess production. They could often find heavily discounted vehicles, generous incentives, and large rebates. However, those deals were frequently the result of an unsustainable business model. Today, automakers, led by executives such as Mary Barra of General Motors, have adopted a different approach. Rather than producing excess inventory simply to increase market share, they are focusing on profitability and financial discipline. What a novel idea for a business. Ultimately, making a profit is the primary objective of any business. Consumers have already begun adapting to higher vehicle costs. The average age of cars on U.S. roads has climbed to 13 years, up from less than six years in 1970, reflecting a growing tendency to hold onto vehicles longer. As a result, many consumers may need to take better care of their cars and keep them in service for more years, a choice that is often financially prudent anyway. Others may increasingly turn to high-quality used vehicles rather than purchasing new ones. The industry's renewed commitment to profitability has also made some automakers more attractive investments. Strong cash flow, healthier balance sheets, and improved earnings have created value for shareholders while helping companies avoid the financial distress that plagued the industry in the past. I do not expect this trend to change anytime soon, and in my view, that is a good thing.   The May jobs report delivered another reminder that the U.S. economy remains on solid footing Employers added 172,000 jobs in May, well above expectations of 80,000, and the broader trend is becoming increasingly encouraging. Over the last three months, job growth has seen gains of 214k, 179k, and now 172k in May, an improvement from the pace we’ve seen really since the beginning of 2025. Rather than slowing, the labor market appears to be finding a sustainable rhythm that balances continued hiring with moderating inflation pressures. One of the most notable areas of strength continues to be hospitality and leisure. The sector added 70k jobs in May, reflecting resilient consumer spending on travel, restaurants, entertainment, and experiences. Despite concerns that higher interest rates would weigh heavily on discretionary spending, Americans continue to spend on services, supporting employment growth across hotels, restaurants, and tourism-related businesses. Perhaps the most important takeaway for investors and policymakers is what we're seeing in wages. Average hourly earnings rose 0.3% in May and are up 3.4% over the past year. That may be close to the sweet spot for the economy. Wage growth is strong enough to support rising household incomes and consumer spending, but not so strong that it creates significant inflationary pressure. For much of the post-pandemic period, policymakers worried that rapid wage gains could fuel a wage-price spiral. Today's data suggests something different: workers are still seeing real income growth while wage inflation has moderated to a level more consistent with long-term price stability. Taken together, the report paints a picture of an economy that remains healthy. Hiring is outperforming expectations, hospitality demand remains robust, unemployment remains low, and wage growth is providing support to consumers without reigniting inflation concerns. That's about as close to a "soft landing" as policymakers could have hoped for a year ago.   Financial Planning: Return on Homeownership Homeownership is often viewed as a superior financial decision, while renting is frequently considered "throwing money away." However, the comparison is more nuanced. A $1 million home in San Diego may rent for approximately $4,000 per month, while owning that same home could cost about $7,000 per month after a $200,000 down payment when the mortgage, property taxes, insurance, and maintenance are included. Even after accounting for estimated tax benefits of $1,000 per month and approximately $750 per month of equity from the principal reduction of the mortgage, the effective cost of ownership would still be about $5,250 per month. In addition, the down payment represents capital that could otherwise be invested and generate returns. When the higher cost of ownership and the opportunity cost of the down payment are considered together, the home would need to appreciate by about 3.5% annually just to produce the same financial outcome as renting and investing the difference. While homeownership offers benefits such as stability, control, and a fixed payment, future home price growth is likely to be much more modest than it was during the low-interest-rate environment of the past decade with many experts projecting between 2% and 3% per year. As a result, neither renting nor owning is inherently the better financial choice. Both can be effective strategies depending on an individual's goals, time horizon, lifestyle preferences, and overall financial circumstances.   Companies Discussed: Boston Scientific Corporation (BSX), Marvell Technology, Inc. (MRVL), The Western Union Company (WU) & AutoZone, Inc. (AZO)

    56 min

  2. May 30

    May 29th, 2026 | How Much Growth Is Left for Nvidia? Consumer Cushion Shrinks, SpaceX IPO Mechanics, 401(k) Planning & More

    Logic should tell you there may not be much growth left in Nvidia  Investing has become increasingly emotional for many people, and too often investors stop thinking logically. Could the popular company Nvidia continue climbing higher? Of course it could. But there are logical reasons to believe its future growth may be limited compared to what investors expect today.  First, consider the company’s market capitalization. As the stock price rises, so does the market cap, which currently sits around $5.2 trillion, depending on the day. To put that number into perspective, $5 trillion is roughly equal to the entire GDP of Japan. With that amount of money, you could buy all the real estate in New York City, London, and Tokyo combined. You could also purchase every major sports franchise in the world several times over.  So investors should ask themselves: if you are buying or holding Nvidia today, are you expecting the company to double in value anytime soon to more than $10 trillion? Does that really seem realistic?  Over the last year, Nvidia generated approximately $216 billion in revenue, which is nearly half the size of the entire U.S. consumer technology industry, estimated at $537 billion in 2025. The company’s revenue grew by about 65% year over year. If Nvidia were to repeat that same 65% growth rate in 2026, revenue would increase by roughly $140 billion, bringing total annual sales to around $356 billion.  To understand how massive that growth would be, only about 25 companies in the entire S&P 500 generate more than $140 billion in annual revenue. In other words, Nvidia would need to add more revenue in a single year than 95% of S&P 500 companies produce in total annual sales.  None of this means Nvidia is a bad company. In fact, it is an exceptional company doing extraordinary things. However, wherever enormous profits exist, competition inevitably follows. We are already hearing about major technology companies developing their own AI chips, while startups and rival semiconductor firms continue introducing competing products that could eventually take market share from Nvidia.  Does that mean Nvidia is going to crash? Probably not. Could it happen? Anything is possible in the market. But for long-term investors, the bigger concern may be that future revenue growth simply cannot continue at the pace investors have become accustomed to. If growth slows meaningfully, the stock could experience years of stagnation or disappointing returns. That is the logical case investors should at least consider.     The Consumer Isn’t Breaking, it’s Quietly Running Out of Cushion  The recent economic data showed that inflation came in line with expectations and much of the shift can likely be attributed to higher energy prices. A bigger concern to keep an eye on is what’s happening to household finances underneath the surface.  April core PCE, the Fed’s preferred inflation gauge, came in at 3.3% year-over-year, exactly in line with expectations. This was the highest annual level since November 2023.  At this point, inflation still doesn’t appear to be a crisis story. If energy prices can decline, I believe much of the recent increase in inflation would dissipate and we’d head closer to the Fed’s 2% target.   While I’d say inflation isn’t a major concern currently, the data suggests consumers are increasingly stretched financially.  The clearest warning sign is the savings rate. The U.S. personal savings rate fell to just 2.6%, one of the lowest levels seen outside of the immediate Covid reopening period in 2022. The April reading was down from 3.2% in March and 5.8% a year prior. It also marked the lowest savings rate since June 2022 when it hit 2.2%. For perspective, Americans saved about 5-7% from 2010 to the beginning of 2020.   That gap matters. It suggests consumers are continuing to spend, but they’re doing it with far less financial cushion than they historically had. Spending resilience is increasingly being supported by depleted savings, rising debt usage, and retirement account borrowing rather than excess cash reserves.  Fidelity reported that 19.2% of workers now have an outstanding 401(k) loan, up from 18.8% a year ago. Meanwhile, hardship withdrawals across retirement plans continue to rise industrywide. Vanguard recently reported that 6% of account holders took hardship withdrawals in 2025, up from 4.8% the prior year and above pre-pandemic norms.  Retirement accounts are increasingly functioning as emergency liquidity for everyday expenses. Historically, 401(k)s were largely treated as long-term investment vehicles. Now they’re becoming a financial backstop for consumers trying to maintain spending in a higher-rate environment.  This data continues to point towards the concerns around the K-shape economy. While debt levels remain in check, increased debt balances or more 401k withdrawals could create more longer-term consequences that we should be aware of.      The most important part of the SpaceX IPO may not be the valuation. It may be the mechanics behind the stock itself.  SpaceX has yet to declare the size of its IPO offering, but it will likely be a single-digit percentage of the company’s total shares outstanding. That matters because float, not just valuation, can determines how violently a stock moves in the early months after an IPO. When demand is huge and supply is constrained, prices can disconnect from fundamentals quickly. If institutions, retail investors, and passive index funds are all competing for a tiny number of available shares, scarcity alone can drive a major rally independent of fundamentals. Nasdaq created a rule in May that shortened the waiting period for megacap stocks to be included in the Nasdaq 100 index to 15 trading days, which is down from as long as a year. There’s also a proposal to shorten the waiting period for S&P 500 inclusion to six months from 12 months and there’s speculation that could be implemented before the SpaceX IPO. If SpaceX is added rapidly to major indexes, passive funds and ETFs may become forced buyers while insiders gradually gain the ability to sell into strength. That creates a setup where institutional demand collides directly with controlled insider supply releases. The result could be extraordinary volatility in both directions.  The lock-up structure may be even more important than the float itself. SpaceX plans to allow certain shareholders to sell portions of their stock before the traditional 180-day lock-up expires. Restrictions usually apply to existing investors, employees, large institutional investors or people with access to privileged information. Under the proposed structure, some insiders could begin selling as early as after the company’s first earnings report if performance targets are met. Up to 20% of the restricted shares may be sold shortly after the company releases its second-quarter earnings. Another 10% would be unlocked if the stock trades at least 30% above its IPO price. Additional tranches of 7% each are set to unlock at five intervals between 70 and 135 days after the listing, with a further 28% becoming available after a subsequent earnings report. Any remaining restricted shares would be eligible for sale after 180 days. Elon Musk, who holds 85.1% of the voting power and 12.3%  of the economic interest in Class A shares, agreed to a 366-day restriction.  Historically, unlock events have often been brutal. The Facebook IPO is probably the clearest example. Facebook had an IPO of $38 in May 2012 during one of the most hyped tech IPOs ever. Within three months, the stock had already fallen sharply, but the real pressure came from the lock-up expirations. In August 2012, Facebook’s first major lock-up expiration released 270 million additional shares into the market increasing the publicly tradable share count by roughly 60%. The stock fell more than 6% that day and closed below $20, almost 48% below its IPO price. Interestingly, your returns in Meta/Facebook have been great and investors who bought the stock after its first day of trading are up close to 1,500%, but investors that bought six months later are up close to 2,500%.  Facebook isn’t the only example. In fact, generally IPOs fizzle out shortly after the hype fades. Jay Ritter, a University of Florida professor, point out the 1,724 U.S. IPOs from 2011 through 2024 had an average first-day pop of 23%, but over the next three years, these stocks lagged behind the market by 25 percentage points. The trend is even more troubling for stocks that trade with a high premium. Since 1980, issuers with trailing annual sales of at least $100 million and a price-to-sales ratio above 40 have seen an average three-year drop of 45% from their first day’s close.  The psychology behind lock-ups is simple. During the first few months after an IPO, the market is dealing with artificial scarcity. The available supply of stock is intentionally constrained while excitement and media attention are elevated. Once insiders are allowed to sell, the supply-demand balance changes immediately. What makes SpaceX interesting is that management appears to be trying to avoid a single catastrophic unlock day by spreading the selling pressure over time. In theory, that could reduce the probability of a massive one-day collapse like Facebook experienced. But it may also create a different environment where insider selling becomes a continuous overhang rather than one clean reset event.  The lesson from previous IPO cycles is that the first trade and the long-term investment outcome are rarely the same thing. Stocks with tiny floats and massive narratives can become detached from fundamentals very quickly. Eventually supply catches up.     Financial Planning: Match or Max Yo

    56 min

  3. May 22

    May 22nd, 2026 | Low P/E Stocks Performing Better in Overpriced Markets? Beer Budget Feeling the Gas Pump? SpaceX IPO, The Breakeven on Social Security & More

    Why do low P/E stocks perform better in overpriced markets? We are currently in a momentum-driven market, and many people are experiencing FOMO, which is the fear of missing out. Much of this is being fueled by AI and technology stocks, where investors are willing to pay almost any price because they believe these industries will continue growing indefinitely and they don’t want to miss the opportunity. The problem is that high P/E stocks and companies with no P/E since there are no earnings at all already have massive future success priced into them. When the market eventually declines, as it always does at some point, it is often because these high-flying companies miss lofty expectations. That can trigger major selloffs and sharp declines in stock prices. Low P/E stocks, on the other hand, typically have more modest growth expectations. Because expectations are lower, market downturns often have less impact on these companies. Many low P/E companies are also more mature businesses with stable cash flows, which tend to hold up better during slower economic periods. Examples include companies in consumer staples and financials. In addition, many low P/E stocks pay dividends, which can help stabilize returns and reduce volatility during uncertain markets. However, investors still need to be careful to avoid “value traps” which are companies with low P/E ratios that deserve to trade at low valuations. This is why understanding the “E” in the P/E ratio or the earnings is so important. You want to avoid investing in companies with declining businesses and shrinking earnings potential. Think about companies like Polaroid or Blockbuster, which failed to adapt as their industries changed. It’s also important to remember that market cycles play out over years, not weeks or months. Just because a strategy has worked well for a couple of years doesn’t mean it will continue indefinitely. For example, it took roughly five years for the tech boom to fully unravel during the dot-com bubble.   Is Your Beer Budget Feeling the Gas Pump? If your beer fridge has been looking a little emptier lately, you're not alone and the culprit might not be your willpower. New Nielsen scanner data shows that U.S. beer, hard seltzer, and cider volumes dropped 6.3% year over year through the week ending May 2, both on a two- and four-week trailing basis. This was nearly double the 3% declines seen between November and mid-April. What's driving it? Analysts at Bernstein are pointing straight at the gas pump. There's a clear negative correlation between gas prices in a given state and beer volume growth, and it's becoming more visible in the data, particularly in markets with the most expensive fuel. Average U.S. gasoline prices have risen roughly 52% since the start of the Iran war, according to AAA. That's a serious hit to household budgets and it shows. California, with fuel averaging around $6.16 per gallon, saw a 16% decline in beer volumes. Arizona and Texas weren't far behind, posting declines of 10% and nearly 7%, respectively. Convenience stores seem to be seeing the brunt of the decline as they are highly sensitive to gas station traffic and impulse purchases tied to commuting and travel. Not every brand is suffering equally. Michelob Ultra is holding relatively flat, while Bud Light and Budweiser are posting double-digit volume declines. Boston Beer remains the weakest performer among major brewers.   Information is starting to trickle in about the SpaceX IPO The SpaceX IPO is expected to be the largest initial public offering on record, with the potential to raise $80 billion or more through the stock sale. Based on the information currently available, SpaceX is expected to begin its roadshow around June 4th, which could place the public offering date near June 12th. The company is expected to trade under the ticker symbol SPCX on the Nasdaq, as well as Nasdaq Texas, which would represent a significant blow to the New York Stock Exchange. If you plan to read the entire prospectus, be prepared to invest some time. The filing totals 277 pages, not including notes and exhibits. By comparison, a typical IPO prospectus is usually fewer than 200 pages. Financial data shows that in 2025, SpaceX generated revenue of $18.7 billion, an increase of 33% over the previous year. However, earnings declined sharply, with the company reporting a net loss of $4.9 billion compared with a profit of $791 million in 2024. Unsurprisingly, Elon Musk will serve as CEO. Goldman Sachs is expected to lead the offering alongside Morgan Stanley, Bank of America, Citigroup, and JPMorgan Chase. Given the size of the deal, it will certainly be interesting to see how all five firms work together. As more important information becomes available, we will continue to keep you updated.   Financial Planning: The Breakeven on Social Security Many people look at their Social Security statement and perform a breakeven analysis to determine how long they would have to live for waiting to claim benefits to pay off. These simple calculations often suggest that claiming at 62 is best if life expectancy is less than around 78, claiming at full retirement age around 67 makes sense if life expectancy is between 78 and 82, and waiting until 70 is best if someone expects to live beyond 82. The problem is that this type of analysis is often too simplistic and can be misleading. Most breakeven calculations only compare the total dollars received at different claiming ages and ignore several important factors. First, Social Security benefits continue to receive annual Cost-of-Living Adjustments (COLAs), whether benefits are started early or delayed. Second, no one truly knows how long they will live, so any breakeven age is really just an estimate. Most importantly, many analyses ignore the time value of money. If someone starts benefits earlier, they may be able to reduce withdrawals from other retirement assets, allowing those investments more time to grow and potentially generate additional future income. When you factor in both Social Security COLAs and the potential return that could be earned on invested assets, the breakeven age often moves much later than people expect. In many cases, it can take well into someone’s 90s or beyond before delaying benefits actually produces a greater overall financial benefit. That does not mean taking benefits early is always the best choice, but it does show that Social Security decisions should be based on an overall retirement income strategy rather than a simple breakeven calculation alone.   Companies Discussed: Versant Media Group, Inc. (VSNT), YETI Holdings, Inc. (YETI), IMAX Corporation (IMAX) & Under Armour, Inc. (UAA)

    56 min

  4. May 15

    May 15th, 2026 | Fed Inflation Problem Deepens, The Market Is Flashing Warning Signs, Consumers Keep Spending Away, Rental Property Performance & More

    The Fed’s Inflation Problem Just Got More Complicated U.S. inflation accelerated sharply in April, with CPI rising 3.8% year-over-year, the highest reading in nearly three years, as the Iran conflict continued to ripple through global energy markets. Core CPI, which excludes food and energy, also rose to 2.8%, up from 2.6% in March, suggesting inflation pressures are beginning to broaden beyond energy alone. The biggest driver was oil. Ongoing disruptions around the Strait of Hormuz — one of the world’s most critical oil shipping routes — pushed crude prices sharply higher over the past two months. Gasoline prices surged again in April and are now up 28.4% compared to a year ago. Diesel, jet fuel, utilities, and transportation costs also moved higher. Analysts estimate energy alone accounted for more than 40% of the monthly CPI increase. Food inflation also remained elevated, rising 3.2% year-over-year. Some categories saw especially sharp increases, including tomatoes (+39.7%) and fresh vegetables (+11.5%). Airline fares were another major outlier, jumping 20.7% from last year as higher fuel costs filtered through the travel industry. The April inflation report complicates the Federal Reserve’s outlook. Markets had expected rate cuts later this year, but stronger inflation and resilient consumer spending are now pushing those expectations further out. Treasury yields moved higher immediately after the CPI release as investors repriced the likelihood of rates staying elevated for longer. That said, it’s important not to overreact to a single report. In roughly two weeks, investors will get the PCE (Personal Consumption Expenditures) report, which is the inflation gauge the Federal Reserve watches most closely. Unlike CPI, PCE captures a broader view of consumer spending and adjusts more dynamically as spending habits change. There are several key differences between the two reports. CPI primarily measures out-of-pocket spending by urban consumers, while PCE also includes rural households and purchases made on behalf of consumers, such as employer-sponsored healthcare and government programs like Medicare and Medicaid. As those costs rise, consumers still feel the impact indirectly. PCE also better reflects substitution effects — meaning it captures when consumers shift from higher-priced goods to lower-cost alternatives during inflationary periods. The weighting differences are significant as well. Housing makes up 44.5% of CPI but only 18.1% of PCE. Meanwhile, healthcare represents just 8.4% of CPI compared to 20.6% of PCE. While the upcoming PCE report will likely also show inflation accelerating, the bigger question is whether this energy shock proves temporary or becomes more persistent. If oil prices remain elevated, energy could continue to be the primary driver behind inflation data for the next several months — and that would make the Fed’s path forward significantly more difficult.   The market continues to flash warning signs beneath the surface. The semiconductor sector, as measured by the Philadelphia Semiconductor Index, has only been this extended above its 200-day moving average twice before in modern history: 1995 and early 2000. Those are not random comparisons. In 2000, semiconductors peaked alongside the final stages of the dot-com bubble, marking a generational top in speculative growth stocks. In 1995, the outcome was different but still instructive: semiconductor stocks entered their own bear market even as the broader indexes continued grinding higher. Given that semiconductor stocks are now such a large part of the market, I believe it would be hard for the market to rally if this sector entered a bear market. There was also another warning sign you should be aware of. Last week, the S&P 500 hit another record high while an unusually large number of individual stocks simultaneously registered fresh 52-week lows. Historically, that kind of divergence has rarely occurred outside of major topping periods. As Bespoke Investment Group noted: “Since 1996, the only other period where we saw the S&P at record highs with fewer than 60% of stocks above their 50- and 200-day moving averages was from late 1998 to early 2000.” That matters because healthy bull markets are typically characterized by broad participation. When indexes rise while fewer stocks carry the advance, it often signals deteriorating internal strength masked by mega-cap concentration. Today’s market has become increasingly dependent on a handful of AI and semiconductor names to sustain index performance. Valuations across those leadership stocks are being justified by near-perfect expectations: uninterrupted earnings growth, sustained AI capex expansion, and continued multiple expansion despite elevated rates and slowing macro conditions. That combination leaves very little room for disappointment. None of this guarantees an immediate crash. Markets can remain overextended longer than expected, especially during periods of technological enthusiasm and liquidity-driven momentum. But history suggests these types of extremes tend to appear late in cycles, not early. The key issue isn’t simply that valuations are expensive. It’s that market breadth, positioning, and sentiment are all increasingly disconnected from the underlying participation beneath the indexes. That’s usually when risk becomes hardest to see — and most dangerous to ignore.   Consumers Say They’re Worried, But They Keep Spending The latest U.S. retail sales report continues to tell a very different story than consumer sentiment surveys. According to the latest Census Bureau retail sales data, overall retail and food service sales remained resilient, with strength in online retail, restaurants, electronics, and discretionary categories. Even after adjusting for slowing momentum from March’s surge, spending activity continues to hold up far better than many expected. Compared to last year, sales climbed 4.9% and even if we back out the gasoline stations where sales climbed 20.9%, sales were still up 3.7%. If we exclude another volatile category in motor vehicle & parts dealers it was up 4.9%. This divergence matters. Consumers say they feel pessimistic and sentiment surveys confirm it. The University of Michigan consumer sentiment index recently fell to record lows of 48.2 as households reacted to inflation and higher gas prices. It’s important to point out this survey has been around for close to 75 years. Ultimately, I believe behavior is more important than survey as that is what drives the economy. Behavior still shows people are traveling, eating out, and shopping online. Employment and wage growth continue to support consumption and until the labor market weakens materially, I believe that will remain the case. Part of the disconnect is psychological. Consumers are reacting to inflation, geopolitical uncertainty, and higher living costs. But at the same time, household balance sheets, labor markets, and asset prices have remained supportive enough to keep consumption moving. As long as spending continues, the broader economy remains on firmer footing than sentiment surveys alone would imply.   Financial Planning: How are your Rental Properties Performing? Rental properties should be reviewed over time just like an investment portfolio, yet many owners focus on a few attractive details rather than critically evaluating the full picture. Looking only at the rent coming in or calculating “net cash flow” using just the mortgage, property taxes, and insurance can create a very different impression than what is actually happening financially. Maintenance, repairs, vacancies, turnover costs, property management, capital improvements, and recurring “one-time expenses” can significantly reduce actual returns over time. That $1,000 per month of cash flow may sound attractive, but it becomes far less impressive if the property has $1 million of equity that could potentially be invested elsewhere. While many real estate investors benefited from rapid appreciation between 2019 and 2022, property values in many areas have recently remained stagnant, causing overall returns to slow considerably. After fully accounting for the true cost of ownership and the opportunity cost of the equity invested, many rental properties have likely underperformed the stock market in recent years despite continuing to generate rental income.   Companies Discussed: The Walt Disney Company (DIS), Whirlpool Corporation (WHR),  Shake Shack Inc. (SHAK) & Ford Motor Company (F)

    56 min

  5. May 9

    May 8th, 2026 | Bitcoin had a nice April, will it continue? Will Gas Prices Come Back Down? April Jobs Report Changes Everything, When Permanent Life Insurance Isn’t Permanent & More

    Bitcoin had a nice April, will it continue The cryptocurrency gained 12.7% last month, marking its best performance since April 2025. Interestingly, according to CryptoQuant, the 30-day change in outright Bitcoin purchases remained negative throughout April. That suggests the rally wasn’t driven by strong spot demand.   Instead, much of the momentum came from something called perpetual futures. Until recently, I wasn’t very familiar with this product, but at its core, it’s another tool that increases risk. Unlike traditional options, these derivative contracts have no expiration date and are designed to let traders speculate on the price movements of an underlying asset. Perpetual futures have grown rapidly in popularity within the crypto space, largely because they allow for significantly higher leverage—sometimes as much as 100x. That kind of leverage can amplify gains, but it also increases the risk of sharp reversals.   Historically, when there’s a divergence between the spot market and the futures market like this, price gains tend not to last once leveraged positions begin to unwind. Where crypto goes from here is anyone’s guess, but piling more leverage onto an already risky asset doesn’t seem like a good idea to me.   When Will We See Gas Prices Come Back Down? No one can predict exactly when gas prices will decline, but many are aware the current prices are being driven higher by the situation with Iran. At this point, the bombing appears to have ended, but much of the country remains heavily damaged. Estimates suggest it could cost Iran nearly $300 billion to rebuild what has been destroyed.   The situation has shifted to one in which Iran is slowly being weakened economically because little to no oil is being exported from the country, resulting in a major loss of revenue. Reports estimate these losses at roughly $200 million per day — approximately $6 billion per month or $12 billion over two months.   Inflation in Iran is currently estimated to be above 60% and continues to rise as economic conditions worsen. Based on these developments, I still believe we could begin to see oil prices decline sometime around the end of June. If that happens, prices may fall at a fairly rapid pace, and by the end of July consumers could see more normal prices at the gas pump.   Lower energy costs would likely help improve overall economic conditions, potentially putting the economy back on track and supporting GDP growth by the end of the year.   The April jobs report just threw cold water on the “imminent Fed cuts” narrative.   The U.S. economy added 115,000 jobs in April, well above expectations of 55,000, while unemployment held steady at 4.3%. Given little growth in the labor force, only modest job creation is needed to keep the rate steady. Wage growth also remained relatively firm at 3.6% on an annual basis. In short: the labor market is slowing from the breakneck pace of the post-COVID boom, but it is not breaking.   That matters because the Federal Reserve has a dual mandate: keep inflation under control & maintain maximum employment.   Right now, the jobs side of the equation is giving the Fed room to stay patient. A few months ago, markets were pricing in aggressive rate cuts based on fears that the labor market was deteriorating. This report makes that much harder to justify. Hiring remains positive & layoffs are still relatively contained. Sectors that were strong in the month were healthcare, up 37k jobs; transportation & warehousing, up 30k jobs; and retail trade was up 22k jobs. Areas of weakness were information, down 13k jobs; and federal government, down another 9k jobs.   The bigger issue for the Fed now is inflation. Energy prices remain elevated, tariffs are feeding through supply chains, and policymakers are increasingly worried that inflation could stay sticky longer than expected. Chicago Fed President Austan Goolsbee acknowledged on Friday that inflation has been “going the wrong way lately.” As long as the labor market remains stable, it appears the Fed has little urgency to cut rates.   The key takeaway: This wasn’t a “Goldilocks” report for dovish investors hoping for rapid cuts. It was a reminder that the economy is still strong enough for the Fed to prioritize inflation over stimulus. And until unemployment starts rising meaningfully or inflation decelerates, the Fed may have a hard time justifying rate cuts.   Financial Planning: When Permanent Life Insurance isn’t Permanent Cash value life insurance policies should be reviewed regularly because the long-term performance of the policy often changes significantly over time. In many policies, the internal cost of insurance increases every year as the insured ages because the probability of death rises with age. In addition, policies also have other internal expenses such as administrative fees, rider costs, premium loads, and investment management expenses. While policies are commonly illustrated using attractive hypothetical growth rates, those returns can be misleading because they are shown before many of these internal deductions are applied. As the insured gets older and the insurance costs rise, the total internal charges can eventually exceed the policy’s earnings, causing the net growth rate of the cash value to become very low or even negative. When this happens, the policy may begin consuming its own cash value to stay in force. If the cash value becomes depleted, the policy can lapse unless substantially higher premiums are paid later in life. Reviewing these policies proactively is important so there is time to determine whether additional funding is needed, whether benefits should be adjusted, or whether surrendering the policy and accessing any remaining cash value may be the better option before the policy becomes unsustainable.   Companies Discussed: GE HealthCare Technologies Inc. (GEHC), JetBlue Airways Corporation (JBLU), The Clorox Company (CLX) & Corning Incorporated (GLW)

    56 min

  6. May 1

    May 1st, 2026 | Regulators Concerned About Private Credit, Prediction Markets in IRAs Soon? Costco vs Gas Rewards, Sports Team Bubble, IRMAA Costs & More

    More regulators are concerned about private credit  The bad news just keeps coming for the private credit industry. If you’re not sure what private credit is, it is mostly middle market business loans extended by asset managers. People often don’t realize that these asset managers don’t have the same strict supervision that banks have on their loans. Investors may be starting to realize the risk because in the first quarter of 2026, private credit investors requested $20 billion from some of the private credit funds. Unfortunately, they only got a little bit over 50% of what they requested or about $11 billion. This could lead to higher redemption requests above $20 billion in the second quarter as more investors become disenchanted with private loan funds. The Securities Exchange Commission over the past few months has opened several enforcement investigations of large private credit managers. The Treasury department is also requesting information from private fund managers and insurance firms to understand their businesses more. The Securities Exchange Commission is the primary regulator for the private credit industry, but the private funds don’t regularly disclose holdings and don’t reveal much about private credit on the forms that are used by the SEC. It is quite the dilemma for these private credit funds, and I do believe it will continue to get worse because I am confident that the SEC and the Treasury department will find areas that could really hurt the individual investor due to the lack of disclosures.    Could prediction markets be available in your IRA soon?   Bitwise, Roundhill, and GraniteShares have filed applications with the SEC to launch exchange-traded funds tied to event contracts. If approved, these products could potentially be held in self-directed IRAs. The initial proposals appear relatively narrow in scope, focusing on outcomes like which party wins the White House in 2028 and which party controls the House and Senate after this year’s midterm elections. While these types of products can sound appealing—and successful bets could generate strong returns—they also carry a clear risk: if you’re wrong, you lose your entire investment.  One of the main concerns is how complex and speculative these instruments are, especially in the context of retirement accounts. Event contracts are fundamentally different from traditional investments like stocks or bonds, and their all-or-nothing nature makes them more like betting rather than than long-term investing. Are we going to soon allow withdrawals from retirement assets in Vegas so people can blay blackjack? The odds may be better there than on some of these “event contracts.”  There are also broader legal and regulatory questions still being debated. Some states argue that certain event contracts—particularly those tied to sports outcomes—should be classified as sports gambling, which would place them under state jurisdiction rather than the Commodity Futures Trading Commission. Tribal groups have also raised concerns, arguing that such products could infringe on their sovereign rights to regulate gambling on tribal lands.  At the moment, sports-related event contract ETFs are not part of these filings, but that could evolve depending on how the legal landscape develops. If courts ultimately allow these types of products and current applications move forward, it’s possible that similar filings tied to sports outcomes could follow.  Regardless of how regulation unfolds, it’s important to understand the nature of these products. While they may be packaged as ETFs, their structure and risk profile differ significantly from traditional investments. Anyone considering them should be clear on one point: this is not investing in the conventional sense—it’s a high-risk, all-or-nothing proposition that is really just gambling.    Who offers a better reward program? The big gas stations or Costco?  When I pull into a Shell gas station, I always see a pitch on the screen about getting up to $0.30 back per gallon. Other stations like Chevron run similar promos, which got me wondering: how many people actually sign up—and are these deals better than Costco’s credit card with 4% cashback on gas?  Right off the bat, gas station rewards programs feel overly complicated. Once you dig in, you’ll find caps, conditions, and purchase limits that make it tough to consistently get the maximum benefit. In the best-case scenario, you might get around $0.35 off per gallon. If gas is $6 per gallon, that works out to roughly a 5.8% discount. Not bad—but actually hitting that number regularly is another story.  Costco’s credit card, on the other hand, offers a straightforward 5% cashback at Costco gas stations and 4% cashback at other gas stations (up to $7,000 per year). At $6 per gallon, that’s about $0.24 back per gallon; at $5 per gallon, it’s $0.20. To hit the annual cap, you’d need to buy around 22.4 gallons per week at $6 per gallon, or about 26.9 gallons per week at $5.  If you’re filling up at a Costco station, the math can tilt even more in your favor. Gas there is often $0.10–$0.30 cheaper per gallon to begin with. Pair that with 5% cashback, and your effective savings climb even further: about $0.25 per gallon at $5 gas, or $0.30 at $6.  So, when you’re standing at the pump at Shell or Chevron and see an offer for a flashy rewards program, it’s worth pausing. The headline numbers can look appealing, but the real-world value often depends on how much you drive and how closely you follow the program’s rules. For many people, a simple, consistent cashback card—especially one tied to already lower fuel prices—may end up being the better, less stressful option.    Is there a bubble in sports teams?  We’ve spent plenty of time talking about stretched valuations in stocks, the frenzy in crypto, and the rise of prediction markets—but sports teams may deserve a spot in that conversation too. Valuations across major leagues are climbing at a remarkable pace.  The NFL is leading the charge, with the average team now valued at $7.65 billion, up from roughly $1 billion in 2010. NBA franchises tell a similar story: the average team is worth $5.52 billion, an 18% jump from just last year. Go back 15 years, and the average NBA team was valued around $369 million—an increase of 1,396%. By comparison, the S&P 500’s roughly 425% return over that same period looks modest.  Major League Baseball is seeing it too, with the San Diego Padres reportedly finalizing a record sale at $3.9 billion. As prices climb, fewer buyers can afford entry into the top leagues, pushing capital into smaller or emerging sports that may carry more risk.  Rick Horrow, CEO of Horrow Sports Ventures, highlighted this trend: “Major League Cricket was at $5 million. Now the value’s at $30 million and going higher. Major League Pickleball two years ago was at $5 million. Now the value is at $15 million or higher.”   Women’s sports are also experiencing rapid growth. The National Women’s Soccer League recently awarded an expansion franchise in Columbus, Ohio for $205 million—a $40 million increase over the fee paid by Arthur Blank (The Falcon’s owner) for Atlanta’s team in November. That deal itself was a sharp jump from the $110 million paid by Denver in January of last year. For perspective, expansion fees were around $2 million as recently as 2022.  The key question is whether these valuations are supported by underlying fundamentals. While interest is rising—about 1.2 million people watched the NWSL final, up 22% year over year—it still trails far behind the audiences of major leagues. Game 7 of the NBA Finals drew 16.4 million viewers, the World Series drew 25.9 million, and the Super Bowl surpassed 127 million.  Media rights are central to this dynamic. The NFL signed an 11-year, $111 billion deal in 2021 and is already eyeing further increases. The NBA followed with its own 11-year, $77 billion agreement starting in 2025. If these massive contracts continue to absorb the bulk of media spending, smaller leagues may struggle to sustain their current growth trajectories.  Most people will never be in a position to buy a sports franchise, but the broader trend is still worth watching and I believe is just yet another example of excessive valuations in today’s markets.     Financial Planning: Understanding the Relative Cost of IRMAA  IRMAA (Income-Related Monthly Adjustment Amount) is best understood not as a flat cost, but as an additional marginal tax rate layered on top of federal and state income taxes. When your income exceeds certain thresholds, your Medicare Part B and Part D premiums increase, and because the adjustment applies for the entire year once you cross the threshold, even by $1, it creates a “tax cliff.” For example, in 2026 the first IRMAA tier for married couples begins at $218,000 of income. At that point, Part B premiums increase from $202.90 to $284.10 and Part D increases $14.50, resulting in an additional annual cost of $2,296.80. Since this tier spans $56,000 of income (from $218,000 to $274,000), that cost translates to roughly a 4.1% marginal “tax” on income within that range, but only if you fully utilize the entire bracket. If you only exceed the threshold by a small amount, you still incur the full $2,296.80 cost, which means the effective marginal rate on those extra dollars can be extremely high. When layered on top of a 22% federal bracket and 9.3% California tax rate, the true marginal rate is about 35.4% if the bracket is filled, but can be significantly higher if it is not. This framing is critical when evaluating strategies like Roth conversions or large withdrawals, because it highlights that the

    56 min

  7. Apr 24

    April 24th, 2026 | Should the Fed still use the PCE as its inflation guide? The consumer remains strong, New Apple CEO stock gains coming? Is Your Annuity Safe? & More

    Should the Fed still use the PCE as its inflation guide? I’ve talked a lot about the shelter index being misleading when it comes to inflation, especially when looking at the CPI, but the PCE has its flaws as well. The Federal Reserve has a 2% inflation target and uses monetary policy, which includes adjusting the Fed Funds rate, to tackle its dual mandate of maximum employment and stable prices. A big problem I see with the PCE is that healthcare now accounts for roughly 16% to 17% of index. This comes as an aging population led healthcare spending to be the single largest contributor to consumer spending in 2025. It surpassed housing and utilities in early 2023 as the fastest growing category in the PCE and by Q3 of 2025, it contributed nearly a full percentage point to overall economic expansion and accounted for nearly half of all spending growth. While it’s important to keep an eye on healthcare inflation, the Fed’s tools won’t be able to have a major impact on the sector like let’s say the housing sector. So, let’s say inflation stays around 3%, but a large reason for that is healthcare inflation. If the Fed hikes rates, it will have little impact on inflation and in fact it could have a huge negative consequence on other areas of the economy and push us into a recession. A big reason I remain worried about healthcare inflation is labor costs. It doesn’t appear we have enough workers to meet the demand for these jobs. On the positive side, the sector has provided stability and growth when looking at payroll data. In 2025, it added 686,000 jobs, which was more than all the gains in nonfarm payrolls. The question is though, can this continue without substantial wage inflation considering by 2030, we will have more people over the age of 65 than we do that are under18. I’m not sure how exactly we can rein in healthcare inflation, but I don’t believe monetary policy would provide a meaningful solution.   Even with all the noise, the consumer remains strong March retail sales showed a nice increase of 4.0% compared to last year and while gas stations were a large contributor growing 18.1% due to higher gas prices, excluding them from the report still would have resulted in a good increase of 2.9%. The only areas that saw declines in the report were motor vehicle and parts dealers, which were down 2.1%, and furniture and home furnishing stores, which were down 0.8%. Areas of strength included nonstore retailers, which were up 10.1%, electronics and appliance stores, which were up 5.2%, and clothing and clothing accessories stories, which were up 7.2%. Food services and drinking places saw growth slow, but there was still a positive increase of 2.4%. It’s not just the retail sales report that showed strength, Bank of America pointed out debit and credit card spending climbed 4.3% in March, the most in more than three years. While a 16.5% jump in spending at gas stations was a large reason for the increase, there was still “healthy growth” of 3.6% excluding gas. We also heard from Wells Fargo CEO, Charlie Scharf, in an interview with Bloomberg Television and he said the U.S. economy remains “extremely strong” and that loan demand is solid, consumer delinquencies are well controlled, and businesses entered this period in strong financial shape. He also said consumer spending continues to grow between 5% and 7% year-over-year. Even with all the noise, the consumer is what drives the US economy, and it appears people remain resilient in their spending, which is a major reason why I believe the economy remains healthy.   Can the new Apple CEO keep the stock gains coming? With the stock trading at a forward price/earnings ratio of around 32 times, I’ve got to say it’s going to be a very difficult task. Keep in mind over the last 50 years the average forward P/E ratio for the S&P 500 has been between around 15 to 19 times, nowhere near 32. I’m also reminded of a similar situation where a prominent company with such great stock success was taken over by a new CEO and the 16-year return was only 27% including dividends. That company I’m referring to is General Electric when Jack Welch retired and the new CEO Jeffrey Immelt who was handpicked by Jack Welch took over. Things could be different this time when the new CEO of Apple takes over on September 1st but again given the current valuation it will be difficult. John Ternus is a mechanical engineer and was head of the hardware division. An engineering degree now represents the highest percentage of degrees among Fortune 500 CEOs, exceeding the number of CEOs with an MBA. I do have some question marks around the choice though as there have not been that many new successful products that have come out of Apple. We’ve had the AirPods and the Apple Watch, but they’ve had some major failures with the Vision Pro headset and are trying to build a self-driving car that they lost billions of dollars on. Mr. Ternus, who is 50 years old, is well liked and is said to have a friendly demeanor along with the engineering confidence, but will he have the magic that Tim Cook had finding ways to squeeze more value out of supply chain? Mr. Cook was also a great political negotiator working with President Barack Obama to President Trump and even made deals with China’s president that has kept the company going. Mr. Ternus does have has some big shoes to fill and a large mountain to climb. I just don’t believe Apple will see returns anywhere near the past returns they saw under Cook when he took over in 2011 and the stock grew by roughly 20 times.   Your annuity may not be as safe as you think! Many people that are sold annuities are told by the broker that they are 100% safe and to be frank they would probably say almost anything to collect their big 7% or 8% commission. But the Treasury department has concerns and is talking to state insurance regulators about the large amount of private loans that insurance companies are using in their portfolios. Back in 2024 even the National Association of Insurance Commissioners, which is also known as the NAIC and is the organizing body for regulators for every state in the US, had stated ratings that insurers had on private credit and investments were consistently overinflated. They have since pulled the report from the website. Large redemption requests from individual investors that want to pull their money out of many private loan funds are starting to show up in other areas like pension funds and insurance companies. The insurance industry holds about $6 trillion in invested assets and roughly $1 trillion or about 17% is now in private credit investments. The insurance industry uses what is known as private letter ratings and can also assign a risk score to the investment. In a study that examined 109 private letter ratings that NAIC officials received in 2023, in 106 of those cases the private rating was higher than the NAIC. To make matters worse, 17 of the cases gave an investment grade private letter rating to assets that the NAIC considered junk or below investment grade. It is especially important to look out for the smaller firms that use smaller rating agencies like Eagan – Jones as opposed to your bigger rating agencies. The smaller firms tend to rate things much higher than the NAIC, sometimes as much as three notches higher, which really disguises the risk of what the annuity you hold is invested in. I’ve said for years that we will someday see an insurance company file for bankruptcy and those investors who invested blindly into annuities because of a salesperson’s recommendation will probably be disappointed to see that they lost all their earnings and perhaps even some of the principal. I unfortunately think it’s too late for some of these insurance companies that have invested into risky assets to turn the situation around quickly.    Financial Planning: Traditional or Roth Choosing between traditional and Roth contributions comes down to one key question: will you be able to withdraw or convert that money at a lower tax rate than your rate today? Traditional contributions work best if the answer is yes, since you get a tax break now and pay less later, while Roth contributions are better if your future tax rate will be the same or higher. Many people enter a lower tax bracket starting at retirement and lasting until required minimum distributions (RMDs) begin at age 75, but this low-tax window is limited. There’s only so much pre-tax money you can withdraw or convert each year before moving into a higher bracket. For example, while working someone may be in the 22% bracket and will drop to the 12% bracket in retirement, giving them some room to access that tax-deferred money at a lower rate. However, the threshold between the 12% and 22% brackets is about $100k of taxable income for joint filers, and other income sources like Social Security and pensions will take up some of that room. If those sources result in taxable income of $50k, then only another $50k can be withdrawn or converted from retirement accounts before being pushed from the 12% bracket back up to the 22% bracket.  If there is $1 million in pre-tax retirement accounts growing at 10%/year, that annual appreciation of $100k is much more than can be converted meaning the account balances would continue to grow. When RMDs begin, the taxable distributions would push income into the 22% bracket or higher and potentially trigger IRMAA. Situations like this are common when retirement account balances are large, and Roth contributions should be heavily considered while working unless the taxpayer is in the highest brackets (32% or above).   Companies Discussed: Abbott Laboratories (ABT), PepsiCo, Inc. (PEP) & Avis Budget Group, Inc. (CAR)

    56 min

  8. Apr 17

    April 17th, 2026 | Watching Sports Has Become a Nightmare, Mentioning AI to Increase Stock Prices, Meta Becoming the Digital Ad King, Beware of Income Taxes When Gifting & More

    Has watching your favorite sports become a nightmare? It used to be easy to watch a football game as you generally had maybe two different networks it would be on and it was easy to find. Well, now the promise of streaming, reducing costs and making it easier for people to watch the shows and sports they want when they want has really missed the mark. The list can go on and on of where to watch the football game or sports you want to watch. Maybe the game will be on ESPN, Paramount+, TNT, NBC’s Peacock, CBS or maybe you’ll have to go to Amazon prime or the YouTube channel. It can be very frustrating trying to find the game you want and then you find out you don’t have the right subscription, and you have to pay extra to sign up for it. Well, maybe the justice department is coming to your rescue. Last week it was reported that the justice department is investigating whether the NFL is engaging in anti-competitive tactics that harm consumers. The investigation involves whether having many outlets for sports viewing is costing consumers far more and the NFL is taking advantage of its behemoth size and demand. There is no doubt that sports are getting out of control and just recently the NBA signed a record payday for their media rights. This has opened the door for many other sports, including the NFL, which apparently because of the change in ownership of CBS they may have to negotiate a new contract with the NFL. No doubt in my mind it will be a far higher contract than before. I’m not sure when the last straw will break the camel’s back, but it seems to be getting close as advertisers are starting to back away from the large amount that networks are asking for advertising during the games. It is possible that sports could eventually go to a cost per game because even subscription rates are getting so high that people are not keeping them long-term.   To increase your stock price, just mention AI I’m of course being facetious, but in many cases, it appears that way. This past week, Allbirds, which was a popular shoe company just a few years ago, announced it was pivoting from shoes to artificial intelligence and the stock at one point spiked by more than 700%. A large reason for the craziness is the market cap of the company was tiny at just about $21 million as of Tuesday’s close. When companies are this small there is more room for manipulation and wild swings as fewer capital inflows are needed to drive the stock higher. What is even crazier about this stock is that just a few years ago it was a hot company valued above $4 billion and that was because of excitement around its shoes. The company introduced its debut shoe in 2016 and went public in 2021. As I said they are now making the switch to AI as they closed all their U.S. full-priced stores in February and will be focusing on AI compute infrastructure. Allbirds will be called NewBird AI and in a recent statement they said, “The Company will initially seek to acquire high-performance, low-latency AI compute hardware and provide access under long-term lease arrangements, meeting customer demand that spot markets and hyperscalers are unable to reliably service.” This is just crazy to me, and you must ask what qualifications this company has to make such a drastic shift. I know I will not be investing in this stock!   It looks like Meta will become the digital ad king Meta has been very patient growing its ad sales by establishing substantial user habits with their products like Reels, the microblogging site Threads, and even WhatsApp. All have been very slow to introduce advertisements to their users, but that patience has paid off as worldwide ad growth for Meta increased around 22.1% in 2025 and it’s estimated it will increase another 24.1% in 2026. Because of how large Meta is, it was expected that growth would slow, but that has not happened. Their growth is far higher than Google’s growth, which is projected to be around 11.9%, about the same as last year. The ad revenue numbers are staggering with Meta expected to reach $243.46 billion, about $4 billion more than Google’s $239.54 billion. That growth has not been cheap for Meta as the company uses AI to enhance performance and capital spending is now estimated to be around $135 billion this year. I was also surprised to learn that Google’s share of the US search ad market is expected to only be 48.5%. This would be the first time it’s fallen below 50% in over a decade. There is so much competition out there from AI companies, like OpenAI, and other social media companies, like TikTok, that the ad market is continually changing. When companies compete, consumers generally win, but I’m not sure about investors as the cost of spending on technology has become a very heavy weight for many of these big tech companies.    Financial Planning: Beware of Income Taxes when Gifting When parents give assets to their children, the income tax impact depends on what’s being gifted. Cash is usually the easiest and most tax-friendly option because there’s no built-in gain. There is no direct income tax to the giver or receiver, but if parents gift things like appreciated stock or real estate, the child receives the original cost basis as well. This means they will owe capital gains tax on all the appreciation when they sell it. In contrast, if the child inherits those same assets after the parents pass away, the basis typically steps up to current market value, wiping out that taxable gain. Because of this, it’s often smarter to gift cash or assets with little appreciation and hold onto highly appreciated assets to pass on at death.   Companies Discussed: Levi Strauss & Co. (LEVI), American Airlines Group Inc. (AAL), HP Inc. (HPQ) & Caterpillar Inc. (CAT)

    56 min
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Smart Investing is the radio show where Brent and Chase try to make investing easier to understand. They demonstrate long-term investment strategies to help you find good value investments.

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