Money Life with Chuck Jaffe

Markus Schomer, chief economist for PineBridge Investments, says in "The Big Interview" that he believes the U.S. economy can avoid recession, not just through the remainder of this year but into 2023 -- when many experts say recession will become official -- as well. Schomer says that people misunderstand the type of economy we're in and the type of inflation we are living through; he believes the Covid economy is still playing out, and that the supply-demand equation will find balance again, and soon enough to keep things rolling without a major market meltdown. That said, Schomer's optimism stood in contrast to Adam Grimes of Talon Advisors, whose take on the market's technical indicators suggests that the ongoing market rebound is nothing more than a bear-market rally, set up to rise high and then reverse sharply, which he thinks will happen in line with the economy slowing down further later this year. Also on the show, Andrew Wellington, co-founder and chief investment officer at Lyrical Asset Management makes his maiden voyage in the Market Call talking stocks.

Joe Keefe, president of Impax Asset Management and the Pax World Funds, says that there are enough positives for the economy right now that he would bet against a hard landing and a protracted recession, although he acknowledges that wildcards like war in Ukraine, trade tensions with China, political issues and more to make him "barely optimistic" that a "soft-ish landing" lies ahead. Also on the show, David Trainer of New Constructs highlights Rivian Automotive as another "zombie stock," pushed to death's door by rising interest rates and higher borrowing costs that he expects can sink the company from here, and Eric Sterner, chief investment officer at Apollon Wealth Management, talks ETFs and stocks in the Market Call.

Ed Clissold, chief U.S. strategist at Ned Davis Research, says that the stock market's recent rebound looks and feels more like the start of a new bull market than it does the standard bear-market rally, though he is not saying that the rebound signals the start of something big. The economy still has a lot to work through, much of which will not come to roost until 2023, Clissold says, and the current strength may be more of a sign that any future decline won't last too long or go excessively deep. Clissold says the U.S. remains the best market in the world, even as expectations have been lowered given economic conditions. Also on the show, Chuck answers a question about hiring a fee-only adviser who charges by the hour, Alicia Munnell of the Center for Retirement Research at Boston College discusses new bi-partisan legislation that she says fails to achieve its goals of offering real assistance to the nation's retirees, and John Cole Scott of Closed-End Fund Advisors and the Active Investment Company Alliance, discusses funds currently trading at premiums and compares them with similar funds priced at a discount, noting that the differences are about more than pricing.

Brad McMillan, chief investment officer for Commonwealth Financial Network, says thatthe bond market tends to have the most accurate message for investors, noting that the bond market tends to be the dog while the stock market is the tail. Thus, the market is reacting to headlines, but the bond market tends to be more steady in its actions. MacMillan says the bond market currently is signalling a coming recession, with the inverted yield curve signalling it could happen in the next 12 to 18 months. Also on the show, Tom Lydon, vice chairman at VettaFi.com, talks about international cash-cows as he picks his ETF of the Week, Meredith Stoddard of Fidelity Investments discusses the high physical, emotional and financial costs of being a caregiver to both special-needs children and aging parents, and discusses the need for appropriate planning. And Corie Wagner, senior industry analyst at Savings.com, talks about the rising costs of participating in bachelor and bachelorette parties, and how it's not necessarily inflation that can be blamed for the bigger payouts that friends and family members endure ahead of the wedding these days.

Stanley Teitelbaum, a clinical psychologist who authored a book on the "self-defeating patterns" that individual investors make says that the market's first-half losses has pushed many investors into a bad type of inaction, one where they don't want to make a move until their position gets back to break-even or recaptures a recent high, neither of which is guaranteed. While no one wants to accept losses, Teitelbaum says investors who evaluate securities on their prospects rather than on the price of purchase will be making smarter moves. Also on the show, Chuck answers a question from a fortunate investor who wants to figure out what to do with an oversized cash stash, and Chance Finucane, chief investment officer at Oxbow Advisors, talks stocks in the Market Call.

Brian Jacobsen, senior investment strategist at Allspring Global Investments, says that if the Federal Reserve knew in March what it knows now in terms of economic health, it would have moved more cautiously. Having acted as it did, he thinks the Fed is unlikely to pull off the hoped-for soft landing, but he believes the market will avoid a crash, leaving the economy with a rough landing, one that could see the stock market improve late in the year before it finds more trouble in 2023. Jacobsen notes that he favors domestic and emerging markets for riding out the trouble, feeling that the U.S. is best positioned, that emerging markets minus China and Russia are the best value and developed Europe -- where he is underweight -- is headed for the toughest troubles. Also on the show, Michael Hershfield, chief executive officer at Accrue Savings, discusses the firm's survey of customers using "Buy Now, Pay Later" programs and how one-third of borrowers are using credit cards to cover those "later payments," meaning they can't afford their purchases, even on a payment plan. And in the Market Call, William Smead, manager of the Smead Value Fund, is here talking stocks, noting that he has changed his long-held tune about big oil and energy companies after years of saying they were not buyable.

Sheldon Jacobson, a University of illinois professor who specializes in operations research, discusses shrinkflation -- where companies hold prices steady but reduce packaging sizes as a means of disguising rising costs -- and says that while the trend is prevalent right now, it works poorly in high-inflation markets because consumers are only caught unaware for a moment. While consumers wake up to the trend and focus on unit prices, Jacobson says that shrinkflation has heavy costs on society, increasing packaging costs, waste production and more that are largely ignored. The show today also looks at the latest "mind the Gap" study from Morningstar with Amy Arnott, portfolio strategist for the research firm, who says that consumers continue seeing their personal performance lag behind the results of the funds they own, a sign of chasing performance and having poor timing results. In the Danger Zone segment, investment analyst Kyle Guske focuses on Beyond Meat, another "zombie stock" being pushed to the edge of bankruptcy by rising interest rates and changing economic conditions, and in the Market Call, Chris McMahon, president of Aquinas Wealth, makes his debut on the show and talks stock investing.

Armando Senra, head of Americas ETF and Index business for BlackRock, says that the Federal Reserve's message this week cleared a path for a slower pace of tightening over the remainder of the year, but that investors must embrace volatility and sustained inflation to take advantage of the market environment. Senra says that weathering the current market storm requires investors with a long-term outlook willing to look past current events to see the industries that will be poised for a comeback when economic conditions improve. In The NAVigator segment, portfolio manager Tim Ryan from Nuveen covers the municipal bond market and how it is disconnected with the Treasury market's inverted yield curve to offer some bounce-back potential for the second half of the year. Also on the show, Jake Wujastyk of TrendSpider.com discusses the market's technicals and how it is trying hard to find a level and build a base for the next rally, and in the Market Call, Art Amador of Equbot talks about using artificial intelligence and machine learning as a means of selecting stocks.

Chun Wang, senior analyst and portfolio manager at the Leuthold Group, says that the market has priced in a shallow recession -- a near soft landing -- but that the Federal Reserve's record of engineering such a smooth outcome is poor, leaving a strong chance that the central bank tightens too much and dramatically increases the risk and severity of recession. Wang believes that inflation has peaked or nearly peaked, but that it will likely settle in around 5 percent -- a level higher than the Fed wants -- eliminating the obvious moves and leaving much harder choices amid a damaged market in 2023. Also on the show, Tom Lydon of VettaFi talks about two key factors in today's market -- high quality and low volatility -- in picking his ETF of the Week, Giles Coghlan, chief currency analyst at HYCM returns to help Chuck answer an audience member's question on trying to take advantage of changes in exchange rates around the strengthening dollar, and Charles Rotblut of the American Association of Individual Investors discusses the 'expected value' of buying a Mega Millions ticket for this week's billion-dollar lottery, and why this is one of the rare times when it makes investment sense to take a flyer.

Giles Coghlan, chief currency analyst at HYCM, says that the economy is reaching a turning point where the Federal Reserve must consider slowing interest rate hikes or risk that those increases will kill off economic growth. Coghlan notes that while all central banks are dealing with this now, the US economy will have the largest impact on the potential for a global recession. Also on the show, Dan DeYoung, portfolio manager for Columbia Threadneedle's floating rate and high-yield bond funds discusses how rate hikes are impacting the credit markets and whether higher rates will trigger significantly greater levels of corporate defaults, Matt Schulz discusses a LendingTree study of how consumers are changing back-to-school shopping habits in the face of higher prices, and Chuck talks about a way to get a win out of the upcoming $1 billion MegaMillions jackpot without even buying a ticket.