Money Life with Chuck Jaffe

Marko Papic, chief strategist at the Clocktower Group, says that while inflation in the range of 3 to 6 percent "will not kill" consumers, it will kill the technology sector because any unprofitable tech companies can't keep borrowing at super low rates to keep the business rolling while they get to profitability. He believes other markets besides the United States are better positioned to support their technology businesses moving forward, which is part of a trend that will see investors want to own China and Japan and Europe during times while inflation remains high. Also on the show, Nathan Furr, author of "The Upside of Uncertainty: A Guide to Finding Possibility in the Unknown," discusses how consumers and savers can lean into the uncertainty of current times and markets to find a path to something better and more interesting, Christian Mitchell of Northwestern Mutual discusses the latest release from the firm's 2022 Planning and Progress Study, which showed how planning significantly improved investor satisfaction and confidence during the current downturn, and Chuck answers a listener's question about I-bonds.

Justin Fitzpatrick, co-founder of Income Lab, says that while investors and retirement savers are starting to freak out about what the market has done to their portfolio values, they should be considering instead whether recent declines have actually impacted their ability to afford the retirement lifestyle they're planning. Funding your lifestyle is what matters in retirement, Fitzpatrick says, while movements in the market are fleeting and may not have much impact on retirement income. Zoe Barry of Zingeroo looks at how investors on the platform have been changing their behaviors in current markets, noting that many younger investors have turned away from the things they know and are comfortable with -- which was pushing them toward meme stocks and popular names -- to broaden out their holdings now. Also on the show, Ken Simonson, chief economist for the Associated General Contractors of America discusses the National Association for Business Economics July 2022 Business Conditions Survey released today, and David Trainer of New Constructs puts SNAP Inc. back in the Danger Zone, saying the big losses it has suffered don't make it immune from losing the rest of its value.

Vincent Reinhart, chief economist and macro strategist for Dreyfus and Mellon, says there is "no safe place for an investor right now except cash" and inflation-protected securities, due to high inflation and the Federal Reserve's inability to this point to get prices under control. As a result, Reinhart says that the economy is either in or entering a shallow recession, with a recovery that could take a while to arrive and that might not be particularly robust when it gets here. Ed Moya, senior market analyst at OANDA, talks technical analysis and why investors are so cautious about risky assets now and why they're not likely to act differently to the market until there's a reason for optimism return until inflation is no longer the primary driver for markets; Timothy Reick, chief executive officer at Liberty Street Advisors -- advisor to the Private Shares Fund -- discusses why private equity is an asset class that is not correlated to the broad stock market that individual investors largely overlook in their portfolios. And in the Market Call, Jason Herried, director of equity strategies at Johnson Financial Group, talks about investing in mutual funds and ETFs and balancing long-term portfolio plans with shorter-term market opportunities.

Erik Weisman, chief economist at MFS Investments, says the macro environment is headed lower and weaker and will take the stock market with it, and while he does not expect this to lead to "a horrible outcome," but with the Federal Reserve likely to raise interest rates above ts comfort level in order to combat inflation, he has little doubt that a recession is coming. Weisman expects current challenges to last into 2023, but he is hopeful that the recession will come quickly to help it pass; he notes that if the recession doesn't happen until later in 2023, "it will be that much more difficult to achieve a soft landing." In the ETF of the Week, Tom Lydon of VettaFi.com looks at the long bonds and says they belong on investors' watch lists if trend lines keep moving in improving directions; in the Market Call, Gerry Frigon, chief investment officer at Taylor Frigon Capital Management talks about growth investing and how the market's slow start to the year has put a lot of good businesses down to where they are compelling long-term values for investors willing to wait out a recovery.

Steven Dover, chief market strategist at Franklin Templeton -- head of the Franklin Templeton Investment Institute -- says that the current stock market and economic situation is not going to play out exactly like some scenario from the past, so that experts are wasting their time harkening back to the 1970s or any other period to draw their forecasts. While many experts will say there's a mild recession in the offing, Dover says that anyone making that prediction needs to consider that there is the potential for something worse. In searching for safe havens, Dover notes that fixed income "now makes more sense than it did at the peak of the market," due to relative price differences caused by the stock and bond markets falling simultaneously through the first half of the year. Also on the show, Jeff Ptak, chief ratings officer at Morningstar, talks about research showing that star ratings -- which were always described as being backward-looking and not good predictors of future results -- actually have benefits in forecasting which funds will be solid future performers, and Chuck answers a listener's question about sequence-of-return risk and whether holding extra cash could help defeat it.

Michele Schneider, director of trading education at MarketGauge.com, says she has limited exposure to the stock market right now because technical analysis shows the market as being "stuck in a range," that she thinks is likely to end with a downward move, which could last until inflation problems are resolved. Schneider says the dollar could be peaking right now, which could create a prolonged boost for precious metals, "which we think haven't really woken up right now." Also on the show, Marketwatch columnist and editor Rex Nutting discusses his recent period about why Americans are so grumpy about the economy in a period where a deep dive through the numbers proves that conditions aren't as bad as angry investors and consumers are making them out to be. In the Market Call, Andrey Kutusov, portfolio manager at Seven Canyons Advisors, talks about being a growth-stock investor at a time when the market is showing signs of limited growth.

George Milling-Stanley, chief gold strategist at State Street Global Advisors, says that the Federal Reserve's signals that it will do whatever it takes to get inflation under control has created conditions in which all markets -- stocks, bonds, commodities and more -- suffer. While Milling-Stanley doesn't think the Fed wants to create a recession, but he says it will take that step if that's what's needed to "knock out any sense that inflationary expectations have become embedded" in the economy. Also on the show, John Petrides, portfolio manager at Tocqueville Asset Management, says the market is at a crossroads, where it could rally before year-end or where 2022 ends painfully. Petrides says the market is closer to the bottom than it was at the start of the year, but he expects three months of volatility before the market gets to where it can sort things out on inflation and set a path forward. And while the entire market might feel troubled right now, Kyle Guske of New Constructs sidesteps the "Danger Zone" his week by pointing out a stock that has been hit too hard by the market, and which he believes has now become particularly attractive now.

Barry Ritholtz, chairman and chief investment officer at Ritholtz Wealth Management, says that the best way to manage volatility is to "Stop looking at the week-to-week, month-to-month numbers and you focus on five-, 10 and 20-year returns because, really, if you're an investor, that's what you re putting your money away for." Ritholtz says that some of the market's current meltdown is "just mean reversion," with the stock market giving back the above-average returns it had during the bull market run, but the bulk of the problem is rising interest rates, rising costs of capital and credit and more that is crimping consumer spending, business economics and slowing the growth of revenues and profits in Corporate America. Also on the show, David Keller, chief market strategist at StockCharts.com, says he could see the stock market heading much lower -- down another 15 percent or more from here -- before rallying, though he sees big-name stocks finding some stability soon and helping to set up a base for a recovery, and John Cole Scott, chief investment officer at Closed-End Fund Advisors discusses business-development companies as they face upcoming second-quarter earnings reports, and how the numbers suggest that they are poised for improved performance, but also to continue a run where they have outperformed closed-end funds and other similar assets during the early part of the year.

Joseph Brusuelas, chief economist at RSM, says while supply-chain induced inflation will ease up, housing inflation will require much more action on the part of policy-makers and he thinks it will be 2024 or '25 before home inflation stabilizes to something close to the Federal Reserve's targets. Brusuelas says there's "a 45 percent probability of a recession in the next 12 months," and he expects the market to move sideways until the Fed looks like it has resolved the inflation problem. In the interim, he says that investors may have to throw out the old saws and platitudes of money management to find industries poised to thrive regardless of market conditions. Also on the show, Tom Lydo of VettaFi.com discusses an ESG-based version of a standard broad-market index fund as the proverbial better mousetrap for investors to consider, and Louis Navellier of Navellier and Associates returns to the Market Call for the first time since the start of the pandemic to chat stocks and growth.

Whitney Tilson, chief executive officer at Empire Financial Research, says he's concerned that Tether, the world's largest stablecoin, is a "fraud" and running out of money. He worries that if Tether crashes "the entire crypto sector goes with it ... and you don't want to invest in a sector where there's a 50-50 chance you'll lose half your money in a matter of days." Tilson talks extensively about what he does trust and is buying in current market conditions, noting that he is maintaining a balance between value stocks trading below their intrinsic value and companies with superior long-term growth characteristics. Also on the show, Bryan Armour, director of passive strategies research at Morningstar, discusses the firm's new survey on mutual fund fees, showing that consumers saved billions of dollars last year by investing in low-cost funds, bringing down the average expense ratio being paid even further, down to roughly 0.4 percent. And in the Market Call, Mike Larson, senior analyst at Weiss Ratings and editor of Weiss's Safe Money Report talks about safe stocks in today's topsy-turvy conditions.