Money Life with Chuck Jaffe

Veteran technical analyst Martin Pring of Pring Research says the market is showing signs that the current bear market could be part of a larger, secular bear market. If indeed those long-term trends are bad -- so that the current downturn is part of a larger downtrend rather than a blip in the long-running bull market -- Pring says the current downturn will stick around for 12 to 18 months. Pring also notes that he believes the Bitcoin bubble has popped, though he's not expecting any kind of rebound until more damage has been done to the price of cryptocurrency. Everett Millman of Gainesville Coins -- mostly talking about precious metals investing -- also weighs in on Bitcoin, as does Big Interview guest Jim Masturzo of Research Affiliates, who discusses how investors can and should use alternatives to make progress amid the market troubles. The show also features Bill Kelly, president of the CAIA Association, discussing how many investors place too much importance on having daily liquidity in the funds, without realizing that having short-term access -- which they typically don't use -- for investments they intend to hold for decades has a real cost.

Tom Lydon, chief executive at ETFTrends.com, says that with inflation entrenched in the economy right now and not looking like it will go away for several years, investors need to take steps to deal with the impact that global-supply chain issues and more are having on their investment holdings. To that end, he made the VanEck Inflation Allocation fund his "ETF of the Week," noting that the real-asset strategy will diversify a portfolio by going beyond just using gold as an inflation hedge, mixing in commodities and other real assets that won't be so in-synch with the market. Also talking about exchange-traded funds, Dodd Kittsley, national director for Davis Advisors, discusses the evolution of active ETFs and whether investors should expect active strategies to outperform the passive in today's hyper-sensitive market. Danetha Doe, economist for Clever Real Estate, talks about a survey of college students showing that they are wildly inaccurate in the earnings they project for themselves once they graduate and join the real world, and Chuck answers questions from the audience spurred by the market's downturn in 2022.

Brian Levitt, global market strategist for Invesco says that there is some good news in the market -- with signs that the bond market is expecting inflation to slow and ease and other indicators showing promise -- but everyone should be watching the impact of Federal Reserve interest-rate hikes to see how long the current doldrums drag on. Levitt noted that less than 25 percent of companies on the New York Stock Exchange are trading above their 200-day moving average, and that the market typically bottoms out when that number reaches 15 percent, but he noted that commodity prices, interest rates and inflation all must moderate before the market gets to a more solid footing. Also on the show, Professor Pelin Pekgun from the Darla Moore School of Business at the University of South Carolina discusses inflation and how supply chain issues typically get resolved so that an economy can break the cycle of rising prices and shortages to return to normal, Ted Rossman of Bankrate.com discusses the record levels of household debt -- but a surprising drop in credit-card debt -- reported Tuesday by the Federal Reserve Bank of New York, and Andy Behar of As You Sow discusses the group's research showing that many social investment funds aren't practicing what their name says they should preach, holding stocks that don't belong in a fund built around current governance standards.

Chris Zaccarelli, chief investment officer for the Independent Advisor Alliance;, says that the current economic situation is different from the Covid meltdown or other recent difficult times because "This time, the Fed doesn't have your back." As a result, investors should not expect a V-bottom to the downturn and a quick bounceback, and investors should be making marginal changes to their portfolios, playing defense and not relying on a rising tide to raise up indexes in the short- and intermediate term. In the Talking Technicals segment, Willie Delwiche, investment strategist at All Star Charts, says that the market needs to see capitulation before it can start to rebuild, and the recent heavy action has not yet represented that kind of market emotion. Also on the show, portfolio manager Lance Cannon of Hood River Capital Management talks small-cap stocks in the Market Call, and Chuck talks crypto and more in the Weird Financial News.

John Bonnanzio, editor at Fidelity Monitor & Insight, says investors need to be as cautious as possible right now, focusing in on their investment time horizon so that they can ride out the potential downturns on the table in the short- and intermediate-term as the market sorts out the high-inflationary environment. Bonnanzio notes that investors with long time frames may want to consider how some of Fidelity's biggest-name large-cap funds are already in bear market territory, which actually has them priced relatively cheap and poised for a profitable bounce-back once the market sorts current conditions out. Also ont he show, David Trainer of New Constructs puts two stocks in the same industry - Equinix and Digital Realty Trust -- into the Danger Zone, and Larry Swedroe of Buckingham Wealth Partners discusses his latest book, "Your Essential Guide to Sustainable Investing."

Jim Welsh, macro strategist at Smart Portfolios and the author of MacroTides, says he still believes the market can rally during the last half of the year, but he says investors have to respect the current downtrend, which is likely to get worse before any bounceback. Welsh notes that consumer savings should help absorb inflation, business spending is up, demand is higher and he believes the economy has enough internal strength to avoid recession so long as the Federal Reserve doesn't have to raise rates above 2.5 percent. If rates rise higher, Welsh says it could lead to a recession in 2023. Also on the show, John Cole Scott, chief investment officer at Closed-End Fund Advisors discusses how to find the right issues to deal with the rising-rate, high-inflation conditions, Chuck discusses some things that he has never head said by experts during the first 10 years of the show, and Janet Brown of FundX Investment Group discusses funds, ETFs and the "upgrading" investment style in the Market Call.

Alan McKnight, chief investment officer at Regions Asset Management says that "the path forward is different than the path we have been on," and that investors must now keep inflation and interest rates "top of mind" as they rethink what is possible and reasonable for the market. He noted that Regions' forecast of returns of 1.5 to 2 percent annualized gains for bonds and roughly 6 percent average gains for stocks over the next decade, which along with heightened volatility will be hard for many investors to stomach. Also on the show, Tom Lydon of ETFTrends.com makes a long-running, big-name dividend-paying fund his ETF of the Week, Chuck answers a listener's question about investing in I-bonds, and advisor Oliver Pursche of Wealthspire talks about stocks and investing defensively in the Market Call.

Lawrence McMillan, president of McMillan Analysis, says that he is seeing signs of a bear market -- which he believes we are in -- in the form of heightened volatility where rallies are in full force one minute and wiped out the next. McMillan says that while the market is showing signs of being oversold, it's not time to act on that yet because only one of the eight primary indicators he tracks is bullish right now, "and it will take a while for them to come around." Also on the show, Bob Powell, the editor of Retirement Daily, talks about how poorly prepared many retirement savers are for dealing with long-term heightened inflation, noting that 'You won't be able to invest your way out of this,' Ted Rossman discusses a Bankrate.com survey on how people are altering summer travel plans based on the economy, and David Brady of Brady Investment Counsel talks about growth investing in the Market Call.

Charles Rotblut, editor of the AAII Journal -- Money Life's all-time leader in guest appearances, but also the person responsible for maintaining the American Association of Individual Investors' sentiment survey -- says that investor optimism over the last three weeks has reached some of the lowest levels seen since the group started its survey in 1987. Rotblut says that when optimism is unusually low, "you tend to see outperformance in the Standard & Poor's 500 over the following six months and 12 months. ... When people are too negative, it's usually a good time to get greedy." But in the Market Call, Stephen McKee of the No-Load Mutual Fund Selection & Timing newsletter says that he still sees too much bullish sentiment and that he doesn't think the market will turn around until investors get negative; until that happens -- and for many months now -- McKee and his newsletter have been bearish. Also on the show, Greg McBride, chief financial analyst for BankRate.com discusses the Federal Reserve's upcoming rate hike and how higher interest rates and rising inflation will affect savers and borrowers in the years ahead.

On the 10th anniversary show for Money Life, legendary bond fund manager Dan Fuss, vice chairman at Loomis Sayles & Co., says that the Federal Reserve is "trapped," and will not be able to fully control inflation and that investors will be living with higher inflation and interest rates "for likely the next 10 years." Fuss compares today's bond market conditions to the Korean War era, and says investors need to adjust their expectations and get used to living with it. Also on the show, David Trainer of New Constructs revisits some of the most successful Danger Zone selections that -- despite being hammered since they were labeled as dangerous -- remain poised for more damage, and money manager Tom McIntyre of McIntyre, Freedman & Flynn, who appeared in the first-ever Money Life Market Call -- is back talking stocks in that segment again today.