Are Shoppers Still Driving the Economy?

What does it mean? How do you invest in that type of a scenario? At the same time, the dollar has continued to be strong causing currency headwinds to companies like Walmart and others, and amid a big week of earnings. That's right. We've got the start of retail earnings, but we also have quarterly results from NVIDIA.

It's a big week. Joining me to put it all together, Lindsey Bell, Bob Lang. Guys. Are you ready for this week? A crazy week before Thanksgiving.

[00:00:51] Lindsey Bell: Yeah, I'm ready. I mean

[00:00:53] Chris Versace: Come on, Lindsey.

[00:00:55] Lindsey Bell: Why not, right?

[00:00:55] Chris Versace: Come on!

[00:00:56] Lindsey Bell: You start thinking about holiday cheer, right? But no, and also, Chris, Bob, it's our favorite time of year.

It's retail earnings, right?

[00:01:04] Chris Versace: I think it's your favorite time of year because you used to cover that sector, Lindsey. For us, it's just a lot of who said what? Comp sales were what? What's the outlook? What's going on?

[00:01:14] Bob Lang: I'm actually looking forward to seeing what interesting items are going to be hot for the holiday season. There's usually some sort of electronics device of some sort. But also seeing what the pricing power of some of these companies is leading up to this holiday. I think we, Chris, you and I talked about this a couple of days ago.

I think there's one less week of shopping because Thanksgiving is coming in late in 2024. So, I think the sales are probably gonna be pretty lumpy, but I'm kind of looking forward to seeing what the hot new item is gonna be for the holiday season.

[00:01:45] Chris Versace: So I agree with you, Bob, that it's going to be compressed, but I do think that means we'll probably eventually see a very busy Black Friday through Cyber Monday.

But remember, too, folks got started way earlier this year, given what we saw in October. Amazon, with its Prime Big Deal days, competing efforts by others, I'm sure that helped Walmart too a little bit. But let's talk about some of our topics for today, and then we'll come back and really break them down.

So today, folks, we're gonna be talking about how do you invest amid policy uncertainty? We'll be talking about the dollar impact. And as we just teased, we'll be talking a little bit about retailers as we start off the retailer part of the September quarter earnings season and maybe a word or two on NVIDIA.

All that when we come back.

All right, folks, let's get started with the meat, the beef, if you will, although I'm not really sure I can say that anymore. Beef seems to be kind of a dirty word, but let's get to the protein of today's conversation. How about that? Lindsey, I want to start with you because you've worn the hat

of investment strategist in the past. You do an excellent job with it today still. If we take a look what's happening in Washington now that we've started to move past the election and President elect Trump is starting to name names, named cabinet members. Maybe getting some potentially wacky, insights and you know, pushes from Elon Musk.

We'll see. We're starting to see some uncertainty evolve, as we're taping this. There's also another aspect of uncertainty that's creeping back in on the geopolitical front. Putin has apparently softened the nuclear doctrine. We're seeing renewed strikes between Israel and Lebanon.

In other words, a lot of uncertainty is starting to kick back into the market. When you face that, how do you kind of stick to your playbook, Lindsey? How do you not get distracted? Or how do you factor it into your thinking?

[00:03:44] Lindsey Bell: Well, I think you just hit the nail on the head is that you really need to not get distracted because even if you think about the escalation between Russia and the Ukraine, and today we're recording this on Tuesday, you're seeing that negative impact actually fade as the day goes on.

But it's also a reminder that if you look back when that geopolitical tension started three, what is it three years ago now, four years ago now that was like, it was a big negative on markets, but then it faded and the market tends to go back to focusing on what the fundamentals are for the companies that are trading in the stock market and what it means for them longer term.

And so I think that we have to, as investors remember that. Not that these things don't matter, they are definitely crises and policy does make a difference in the future of the country, but policy moves a lot slower than the stock market does so those are just kind of some ways that I try to keep myself grounded.

[00:04:43] Chris Versace: So if I hear you right, Lindsey, it's kind of you see the headline. Take a deep breath, pause, maybe ask yourself, okay, what's really at play here? Is this some saber rattling? Is perhaps one side poking the other, looking to see how they respond? But if that's the case, Bob, how long do we kind of go before we think we might have a response?

Or do we just have to kind of let it play out and do our day to day job as investors and then circle back and deal with any new ramifications that emerge.

[00:05:16] Bob Lang: Well, you know, Wall Street has a history of trying to take advantage of situations that where the public or other countries and so forth look vulnerable.

There's an old phrase out there. I'm sure you've heard of Chris is, it goes like this when the bombs fly, it's time to buy and that sort of thing happens all the time when there's panic and some worry about the end of the world happening. You know, all those people over

many years have placed bets on the end of the world and fortunately they've never paid off. Come close, but certainly I think what we have to do is just you know, keep a cooler head Pay attention to what's going on in front of us.

You know, the analysis that we provide what we look at for things such as retail sales, and you do an excellent job talking about manufacturing and the purchasing managers reports and, ISM numbers. All those things matter, right? And what we have to do is, you know, we have to take advantage of those situations.

Ignore all the other noise that's happening.

[00:06:15] Chris Versace: All right. So let me ask this to both of you, then. So if we're agreeing that, you know, among some of these disruptions, some of these uncertainties, whether it's geopolitical or potential policy coming out of Washington, in the short term, we really want to pay attention still to the data that's going, watching the unfolding landscape.

But how do you factor in things, for example, like Bitcoin going crazy, gold trending higher, or treasuries? And kind of some renewed action there. Did you guys factor that in? Or kind of on the periphery? Or are they potential signals that something else might be awry? Lindsey?

[00:06:53] Lindsey Bell: yeah, of course, you're always looking at the entire landscape.

But one thing I would say is that if you look at what, you know, I don't know if you call it a Trump bump or a Trump pop. The week of election, we saw the S and P 500 up almost 5%, the NASDAQ up almost 6%, small cap stocks were up almost 9%, right? And we've seen in the past week, a lot of that come off too.

So I think we did get over our skis. I think investors are getting back to the reality of there is this policy uncertainty, there is interest rate uncertainty, there is inflation uncertainty. And so I think we're trying to kind of get everything in lined. I also think investors probably were thinking when Trump was, you know, was named to be the next president.

There was a lot of anticipation that we would get this pop, like we did in 2016, the pop between inauguration or between election and inauguration day. I think it was like five or 6 percent and then the stock market was up another five or 6 percent in the first hundred days of his presidency.

And so I think it's just, we're kind of grappling with all this. There's a lot of things though that are different this time versus that time, one of which is valuation, you could say.

[00:08:05] Chris Versace: Right. I mean, and I think where interest rates are are kind of another thing. Although as they come down, that could arguably be a tailwind to the economy.

It could be a tailwind to the market, depending on the pace. So as we've talked quite, quite a bit here on the show we all know inflation is sticky. But Bob,

[00:08:21] Bob Lang: So, I think you have to, have some respect for the M word, which is momentum. Momentum is very strong in the markets, not just with the equity markets and the small caps that Lindsey had mentioned, but also with Bitcoin and even gold to a certain extent.

Now gold pulled back a little bit. It's catching a nice bid with the worry and the geopolitical fears that have been announced the last couple of days but I think it's the momentum of this market Chris that has really just triggered and unleashed an insatiable appetite for people to go after stocks keep coming after and after. Eventually It's going to stop and it's going to slow down and reality is going to hit people in the face. But as it is right now, the momentum is extremely strong.

[00:09:03] Chris Versace: So let's try and help the listeners out, Bob, because you just kind of started to go down the road of my question.

If there is a lot of momentum, how do you know when the, you know, the gas in the tank, you know, you're going from full to medium to on fumes when it comes to momentum? Are there any particular indicators that you look at? Oscillators? I mean, throw the audience a bone, why don't you?

[00:09:25] Bob Lang: Well, you really don't know when it's going to be over right until it's over.

And until the markets start to roll over the opposite direction. But, you know, you can look at different indicators and so forth. Momentum indicators, things that I look at, like the moving average convergence, divergence, the MACD, the relative strength index, stochastics, these sort of indicators are secondary to the price and volume indicators.

However, they do provide a good view of where the sentiment and the momentum of the market is at any point in time. And that's an important marker to understand that, hey, look, you know what, we were overbought. We're due for a sell off or a pullback or even a correction. It's time to take some chips off the table.

So if you're willing to be active and move some money when we reach those peaks of overbought, I think you're going to be way ahead of the game and looking for opportunities when the markets do

uh, pull back.

[00:10:19] Chris Versace: And Lindsey from a fundamental perspective, I know you and I have chatted about, you know, P.

E. multiples and them being stretched in the past relative to earnings growth. Anything else you would add that you is a fundamental person when assessing if the market's overbought, overdone, about to run out of gas.

[00:10:35] Lindsey Bell: Yeah, for me it's earnings, right? If earnings expectations are going lower, I mean, it's the most basic thing, right?

If earnings expectations are going lower and earnings results aren't coming in better than expected, then we've got a problem, right? Houston, we have a problem.

[00:10:50] Chris Versace: Ha, totally agree. All right. Let me just say that to wrap up our first topic. Look, we all know that there's a lot of noise in the marketplace and you really have to stick to the data.

The data is the key is the guide, whether or not it's fundamental data, that you might get from third party research firms, economic data, or even technical data in the market. Follow the data. Let that be your guide and update your thinking as policy becomes a little clearer and or as geopolitical uncertainty becomes a little more, dare I say it, crystallized.

All right, with that, let's move along and this is actually a nice segue, Lindsey, because you were just talking about earnings and we have seen earnings expectations for the second half of the year for the S& P 500 come down. We've talked about it. It happened again last week. But at the same time, we're starting to hear something else.

And that is currency and our good friend, the greenback, the dollar. Now if we take a look at a chart at the dollar you know earlier this year It was kind of coming down and really over the last several weeks, I want to say almost since the start of like mid October, early October, the dollar has started to really rebound and I think that's tied to something we've talked about which is the expectations for fed rate cuts have kind of come back a little bit So the dollar's been stronger, but as it relates to earnings, Lindsey,

are you concerned that some multinational companies, ones that have meaningful exposure outside the US, that they might not really deliver what people are looking for because of this dollar strength?

[00:12:31] Lindsey Bell: Well, you're definitely going to hear about it on earnings calls. There's no doubt about that in my mind.

Companies are very good about calling out the strength of the dollar and how it negatively impacts sales and earnings, but they are not very good about calling out when the dollar is weaker and it benefits them, right? So

[00:12:48] Chris Versace: No, that's just continued strength. We're Lindsey.

[00:12:52] Bob Lang: Got to be quiet about that.

[00:12:54] Lindsey Bell: Exactly. Right? No, but I, so in all seriousness, though, it is a serious factor and it is going to impact those multinationals. And last I looked, I haven't looked in a while. So Chris, you might have a better number than me, but it's about 50 percent of the S& P 500 derives their sales from overseas. So there will be a real impact there.

But I think in general that when you think about the strong dollar, well, first and foremost, what companies and the U S economy likes best is a stable dollar, right? We don't want it to be volatile. We don't want to be super strong. We don't want it to be super weak. We want it to be stable, but, a stronger dollar does bode well for the economy, it says there's confidence in the economy. Right? In the US economy. It tends to align with higher interest rates and maybe sticky inflation, too. You're actually seeing the DXY on this Russia, Ukraine, escalation today popped about 10 percent last I looked.

So the U. S. Dollar is a safe haven. The geopolitical issue hasn't been as much of an impact over the last I don't know, year. I mean, it's definitely an underlying factor for the strength of the dollar. But the dollar is up almost 6 percent since late September.

So, yeah, so there's a real impact there.

[00:14:07] Chris Versace: So when you hear a company like Walmart say, wow, you know, we've seen it over the last three months, because remember their quarter ends in October, they didn't really see the full impact of what you just talked about, Lindsey, but when they talk about the current quarter for them, that ends in January versus the October quarter, and they're saying that currency impact is likely to be bigger during the holiday season for us than the prior three months,

that's an indication that we're going to hear about this from a lot more companies, isn't it?

[00:14:38] Lindsey Bell: Yeah, I think that is. And it is interesting because Walmart did call out the potential for tariffs having a major impact on them as well because it also, the price of goods, but also the strength of the dollar too.

So there is, I think you're going to continue to hear about that. And I think it gives companies reason to be conservative with regards to their guidance. It kind of gives them You know, an excuse that allows them to kind of, I don't want to say low ball, but be conservative with guidance because of the unknown.

It is an unknown,

[00:15:08] Chris Versace: Totally agree with that, Lindsey. And just remember folks that the benchmark out there is, whether it's S& P Capital IQ with Lindsey or, you know, team Versace over here with First Call, it's the consensus expectation for the S& P 500 next year in terms of earnings growth is about 14.5, 14.6

percent year over year. So Lindsey, you know, you raise a great point that between now and the end of the year, or even in January, as President Trump starts to put forth policy, or perhaps enact tariffs, it's a big unknown. You know, if they're negotiating tactic or something more. I think you're right.

Companies are likely to take a conservative approach. Perhaps that 14. 6 percent number comes down kind of bigly and then the market has to readjust its thinking. Bob?

[00:15:57] Bob Lang: If I had to tell you how the strength of the dollar over the past three years, it probably, you'd probably be stunned. When the Fed started raising interest rates in the early part of 2022.

The uh, UUP, which is the ETF for the bullish fund for the dollar was around 23. Now it's at 29, almost 30. So the dollar on a, Relative basis is up about 25 percent since the start of 2022. And of course, inflation was going through the roof in 22, even as the Fed was raising interest rates, the dollar was still getting stronger.

And then in 23, when we had such a strong market for the NASDAQ, the NASDAQ was up 50 something percent 500 up about 20 something percent, the dollar was up again, and it's up again this year. It's just pretty astonishing that, I mean, what it tells me, Chris and Lindsey, is that the economy is extremely strong and if there's very little inflation, the Fed is doing a great job in pushing inflation down with a restrictive monetary policy. And there's really been nothing wrong with the economy, as it relates to the dollar over the past, you know, a few years, what do you say?

[00:17:06] Lindsey Bell: So what I would say is I agree with you for the most part, but the other impact to that has played a role in the dollar is the Chinese yuan, which has fallen and that they're obviously weaker economy over there, too. And so I think the question too is on some investors minds is maybe will China devalue their currency to support their economy?

And I mean, I don't think that's the case, but it is impacting and it doesn't help when Trump is threatening big massive tariffs on Chinese goods. And there's some folks think maybe he'll prevent any exports out of China to the, importing it into the U S. And so, I don't know. It's just something to watch or consider.

I agree with you. I think it's more about the strength of the U. S. economy, If you look at economic growth across the globe, you know, the U. S., even I think Jay Powell called this out last week, the U. S. is really the shining light.

[00:17:58] Chris Versace: Oh, no question about it. Take a look at some of the recent data out of the Eurozone, take a look at what's happening in China's economy.

I mean, you know, it is the best house on the block. No question about it. But when we think about the dollar, correct me if I'm wrong, Trump in the past has said that he always wants lower interest rates and a weaker dollar, right? And that would probably help spur the U.S. Economy probably helps spur U.S. exports because they would be that much cheaper in other markets, right?

You know when we think about a strong dollar as a US citizen, boy, I love a strong dollar when I'm going abroad because my dollar goes much further. On the other hand if I have to buy foreign goods, not so much, right? So, you know, you really got to be careful there. Do you think we'll hear Trump as part of his, you know, saber rattling or call it what you will. Do you think he's going to continue to hammer home, we need lower interest rates, the fed has already said it they need to do more and we need a lower dollar That was kind of a question guys. Don't leave me hanging.

[00:19:01] Bob Lang: You know, I'll tell you what I definitely agree with that and if I look at historically, I mean we have to look at Trump 1. 0 to understand maybe where Trump 2. 0 is going to be going. The dollar peaked right at the end of 2016, right after the last election, and it tanked hard in 2017, even though the stock market was up every single month for that whole calendar year, Chris. But the dollar tanked all the way down to the start of 2018. Then it came roaring back, and then obviously we had COVID, a lot of different issues in 2020.

But still, I think we could look at this as a potential playbook here and see that, yes, I agree with you, I think that Trump is going to try and push the Fed to cut rates even more, possibly down to some below neutral rate, whatever that is. I think chair Powell came out and said, well, we really don't know where neutral is, which, you know, kind of a, is a hint at saying, well, It could be here or it could be a little bit lower or it could be even a little lower than that.

So, I do think that you're right. I think that Trump is going to try and use his bully pit to try and push rates lower, push the dollar down even more, much like it happened in the first year of the first Trump presidency.

[00:20:11] Chris Versace: Yeah. My prediction on that is Trump will do whatever he can, but you know, as we saw during the most recent Fed policy meeting when Fed chair Powell was questioned about the president's ability to remove him.

You know, Sheriff Powell, he's in charge. No, was the firm answer. And I think Powell is going to move as Powell sees fit. Lindsey?

[00:20:38] Lindsey Bell: No, I 100 percent agree with you. And I think that this time is a little bit different. We have a strong economy right now. We have high interest rates. We have sticky inflation.

You can't just bully the dollar lower. And you have to take into consideration what's going on around the globe too. So yeah, I think Trump is gonna, there's gonna be a lot of rhetoric, but I think Powell's gonna stick to his guns. He's gonna remain independent on that front, because he cares about the future of the economy.

[00:21:03] Chris Versace: I agree. But you know, as you were saying that, Lindsey, this thought just kind of popped into my mind if Trump just gives Powell time interest rates will probably get pretty close to what Trump wants anyway, he doesn't necessarily need to beat him up. You know, we've talked about how interest rates are likely to go lower, at least into the start of 2026.

Right? So just, you know, and this is the hard part. Zip your lip, and let it play out. You don't have to jawbone and you know do all that crazy stuff. But We'll see how it all goes.

[00:21:35] Bob Lang: Who are we talking about now Chris?

[00:21:37] Chris Versace: I think we're talking about you Bob. I said crazy, right? All right. Hey lindsey, can you wrap us up on this second topic about the dollar please?

[00:21:44] Lindsey Bell: Yeah, I think that all in I think the dollar is strong and it's probably going to continue to remain strong despite what Trump might like it to be weaker. But ultimately at the end of the day I think you really summarized it well. I think that the dollar will go where it needs to go and that's, eventually over the longer term, potentially lower as interest rates do come down and the economy normalizes. So near term, it seems, you know, you see a lot of headlines on the dollar. You're going to continue to from Trump, but I think the dollar is going to do, it's not going to be a massive concern over the long term. It's kind of like our political uncertainty conversation. It's something that you you have to kind of put in the back of your mind.

[00:22:25] Chris Versace: So, two topics discussed. Two topics. Don't worry about it, it'll take care of itself is what you're saying. Lindsey. Okay. Thanks. Boy, I feel much better about our conversation today. All right, let's move into the last one. All right, folks. So, you know, over the last few weeks, you've probably read about it, heard about it.

We've probably even talked about it. The September quarter earnings season and you know, I think a little bit more than 90 percent of the S& P 500 basket has reported. That means that we're kind of pivoting, not so much from September quarter, but really October quarter. That means a shift towards retailers. Lindsey is so excited by all this,

I can't even tell you. Kicking it off this week, we had earnings from Walmart and we'll get a few others this week as well, but next week, a real barn burner. But I'm kind of curious, guys. I know you've both looked over Walmart's earnings. We've also got NVIDIA this week, but let's stick with Walmart here first.

What do you think? I mean, it looks like they took market share. Looks like folks are trading down.

[00:23:29] Lindsey Bell: Yeah, I mean, I think it was a good report. It was a solid beat on the top and the bottom line. They raised their guidance, right? And not just a little bit. Their sales growth guidance went from 375 to 475 all the way up to 48 to 51.

[00:23:44] Chris Versace: Yeah. I mean, if you parse the numbers, maybe like I did, it says year over year, their quarter is going to be up like 9 to 10%. Big number, right?

[00:23:53] Lindsey Bell: I mean, that's huge. And I think it's a testament to the trading down of the higher income consumer and I know you've got a stat on the hundred thousand dollar customer.

[00:24:03] Chris Versace: 75 percent of share gains came from customers whose annual income is over a hundred thousand dollars

[00:24:10] Lindsey Bell: Yeah, I mean, part of that is product.

They're getting e commerce right too. So they are turning this ship around. It's not just like people really want cheap goods, but they did admit that people are focused on value, value for the price. So I think that consumers are starting to go there first. I think they did really well. E commerce sales up 22 percent in a quarter where Amazon had Prime Day. So I mean, that says something, right?

[00:24:38] Bob Lang: what I think is interesting is what Lowe's had to say on their earnings call is that they talked about the storm damage and the replenishing of some materials that, um, people were coming in to buy.

I think Walmart also made a slight comment about that as well to the storms that hit Florida a couple months ago. So I think obviously it's temporary, but still it's that's gonna be dollars in our pockets. Home Depot to a lesser extent than what Lowe's said the prior week.

[00:25:06] Chris Versace: Yeah, no, I agree with that. I agree with that. so here's my question to both of you. Maybe this is a stumper. Maybe not. If you'd like Walmart's results, right? And their comp sales for the october quarter up 5. 3%. If you like that, what company do you have to love? And I have one in particular in mind,

[00:25:25] Bob Lang: Costco.

[00:25:26] Chris Versace: Ding ding. Yes, if you go back and you trace Costco's August, September, October adjusted comp sales, up significantly compared to Walmart's 5. 3%. And they have a sweet spot with consumers in terms of annual income north of 100, 000 a year. And they also have the grocery business just like Walmart does.

So I, if you like Walmart, I would say you got to love Costco. And I do have to disclose that we do own Costco in the Street Pro Portfolio. Not just talking to my book, I'm giving you guys the numbers.

[00:26:01] Bob Lang: So the one thing about Costco, Chris, also, is they're still in that one year time frame of increases in their membership prices, right?

 That started I want to say September, August, something like that. And but remember though, That's not an immediate step up, right? As people renew throughout the year you'll see that step up and they're very high margin and very lovely recurring revenue stream known as the membership fee revenue.

[00:26:28] Lindsey Bell: High margin stuff.

[00:26:29] Chris Versace: I mean, if you do it, I mean, depending on the quarter, it's 70 to 80 percent of Costco's net income. I mean, it's a wonderful business and it's something that really makes them a huge differentiator. And yes, I love going to Costco.

Not because Bob likes the hot dogs.

[00:26:44] Bob Lang: One thing I was going to mention, Chris and Lindsey, is a week ago Monday was November 11th, Veterans Day. And it was also a big event for, in China, it's Alibaba's Singles Day, which is a huge retail event for them. It's just, you know, everything's on sale.

It's usually very well publicized and very well advertised about people coming in and buying stuff thing, useless things probably. And, but you know, who knows, but the sales are usually through the roof. We didn't see a whole heck of a lot of news about that, Chris. And I'm kind of curious, it's like the first time in about seven years, they were really very subdued about their results and about their sales and bringing it out to the public.

So I'm wondering if some of that is pent up demand, Chris, for people are just tired of Alibaba and they're going to go to Amazon, they're going to go to Walmart, they're going to do other, shop at other places online instead of Alibaba

[00:27:38] Chris Versace: I think that Alibaba, given the headlines that they're making and trying to, you know, do whatever they can, that they're leaning more into AI than retail sales, given the Chinese economic backdrop that we talked about previously.

[00:27:50] Bob Lang: Interesting. Okay.

[00:27:52] Chris Versace: All right. We also have, speaking of tech, we also have earnings from NVIDIA this week. NVIDIA is one of the top two holdings in the S& P 500. So to the extent that NVIDIA delivers a good quarter, which I think they will, we could take a look at the monthly revenue reports from Taiwan Semiconductor, comments about AI adoption.

Data center building forecasts and all this stuff. I think it will be good. Bob, are you concerned, though, that NVIDIA could slip on the guidance?

[00:28:22] Bob Lang: Yeah, no, I think that anybody who wants to own NVIDIA already probably does. And I guess the problem that I'm having with this whole thing, Chris, is on the one hand, you hear Jensen Wong saying that the demand for Blackwell chips is just insane, which is what he said about six weeks ago.

Insane. Okay. Credit to them with their great product and credit to them for selling it to the big players like Microsoft and Google and so forth, But could it already be priced in? You know, I think that's the trick that the market is playing on people right now is that, the good sales that they're going to achieve here is already priced in. And what is the amount of sales that you're paying for in the out years? I mean, are we paying for earnings in sales out into 2027 and 2028? Is that really where we're at right now? Because I mean, here we are in 2024, three, four years out from now, I don't know if very many people are full on, you know, with stability there, looking in the out years and saying that, yeah, you know what, I'm comfortable paying three years, three, four years out for earnings in 2024.

[00:29:33] Chris Versace: So I think that question gets to the heart of where we are in the AI adoption cycle, whether it's in the enterprise smartphones, PCs, you know, or other connected devices. And, you know, all indications are that we're still somewhere in the early innings. I think Cisco was talking about that on their earnings call.

But I think the other side of it, Bob, is when we get guidance from Nvidia, what can we look to kind of support it? Confirmation, if you will, right? So, Lindsey, when I do that, I'm recognizing that we get monthly revenue reports from Foxconn, you know, AI server demand has been extremely strong, but we've got earnings next week, not just from retailers, but HP, Dell, their comments about AI adoption, AI PCs, AI servers, do you think that will be, you know, important to kind of, like I said, confirm whatever guidance NVIDIA gives, good, bad, or stupendous?

[00:30:30] Lindsey Bell: Yeah, no, I think that investors in NVIDIA are looking around for other clues that the A. I. Revolution is expanding into other industries. First and foremost, the computer PC market for sure. But I think to that. Yeah. Expectations are high for NVIDIA going into this print in the and the stock has moved accordingly as you know, information has developed.

New news has come out. But I think this is a story that's like, innocent until proven guilty. So maybe it doesn't, the stock doesn't pop or maybe it even falls a little bit on the report, but I think it's going to continue to move higher into the end of the year, just given the expectation for the AI adoption, the fact that it is in, or in fact in early stages, they're still continuing to see uptake.

Sure they have some challenges in getting the chips created and out, but they're addressing those and the demand is still there and growing is the point. So

[00:31:27] Chris Versace: In all the surveys that you can find, I don't think there's one I've seen where CFOs are like, hell no we're spending less on AI.

I haven't seen one. Everything seems to indicate that they are ramping their spending a year over year. Bob, I'll give you the last word and then wrap it up.

[00:31:45] Bob Lang: So just real quick very short story about, because we, couple months ago we had a little tease session against me about AI and me not understanding what the usefulness of it is.

Well, how do you,

[00:31:55] Chris Versace: Bob how do you spell AI?

[00:31:57] Bob Lang: IAI or AI? I saw something that was very interesting. And there was a video that showed me that you can pretty much point your camera using AI, point your camera at a plate of food, and it can tell you how many calories and all the different metrics on the food, the amount of fat and carbohydrates, that sort of stuff.

Just by

[00:32:17] Chris Versace: having hang on, I got it. I'm not kidding. I'm not saying you're kidding of all the examples of a I. How'd you latch onto this one?

[00:32:27] Bob Lang: I thought it was interesting because I don't know. I mean, maybe something about the AI is attached me to looking at food on a plate or something like that.

But I thought it was fascinating. I'm like, wow. You know what? I have one of these food diaries. I use one. And I don't have to write down, you know, all my,

[00:32:45] Chris Versace: here it comes, Lindsey, productivity at its purest form for Bob.

[00:32:50] Bob Lang: Hey, listen, you know, if this is what AI is all about, I can warm right up to it. That's fine.

[00:32:54] Chris Versace: All right. All right. A big helping plate of AI for Bob. All right, Bob, wrap it up. Retailers, NVIDIA. What are you watching? What do we need to know and why?

[00:33:03] Bob Lang: let's see how the retailers look for holiday shopping season and boy, NVIDIA, if they can hit the ball out of the park, there's going to be a huge tailwind for them with other companies as well, too.

And it's gonna be very exciting week of trading.

[00:33:15] Lindsey Bell: I just want to summarize that if Bob is adopting AI at this level, we are just really at the beginning and very early. Yeah. For the rest of the world.

[00:33:27] Chris Versace: So, so we are early stages, Lindsey. That's what you're drawing from that.

All right. I agree. I agree. All right, folks, we'll be right back to wrap it all up.

 Oh my God. That was a fun and spirited conversation. Bob, thank you for being the sacrificial lamb on the AI front. But you know how I am, Bob. You know, if you open the door, it's rude not to walk through and take the shot. So, you know, all is fun. We wouldn't rib you if we didn't care.

Think of it that way.

[00:33:55] Bob Lang: Anything to help the show.

[00:33:57] Chris Versace: I appreciate your sacrifice. All right let's wrap up this episode. I know we've got another big one coming next week as we move into the real thick of retail sales and getting ready for the post Thanksgiving shopping bonanza weekend.

But Lindsey, what stood out to you in our conversation?

[00:34:16] Lindsey Bell: So I think, you know, giving Bob an olive branch here, I think he did make a really good point about momentum begets momentum. And we talk about that a lot. And so I, I don't think investors or advisors should get rattled by the more recent pullback that we've seen in some of the stocks and parts of the market.

I think that what you have seen over history is that when a bull market hits its two year mark, it's significantly likely to go another two years. And we talked about a lot of the drivers, even though uncertainty does remain. There's a lot of fundamental and economic drivers that can take us forward through those next two years.

So I'm with Bob. Momentum begets momentum.

[00:34:59] Chris Versace: So the Mo Bros, as I like to call you two. Bob, what stood out to you in our conversation? And don't recap AI on a plate, please.

[00:35:07] Bob Lang: for me, it's a it's retail, Chris. And I think retail is going to tell us the, tell a story about what's going to happen for the holiday shopping season and into 2025.

I think there's a real good story to be told by some of these retailers. If they can come out and promote and have some good items there with some good pricing and so forth. I think there's a lot of people who are going to be happy with their sales and happy with their products the end of the year.

So it can be a win for the customer and for the companies.

[00:35:38] Chris Versace: So I think you're right. The only thing I would dovetail on that is just in the vein of know the company you're talking about, we didn't really call it out when we were talking about Walmart, but you know, they have been benefiting from share gains in grocery.

So when we think about their holiday shopping season guidance, I think I said the current quarter that ends in January. If you parse their annual guidance, the January quarter should be up nine to 10 percent year over year. Just remember, you know, grocery factors into that and the Thanksgiving, Christmas, New Year's, those are big grocery shopping events.

So just be careful when you think about that. In other words, just cause Walmart might be up almost double digits doesn't mean other retailers will be so, be careful. Hang on to what we're going to hear next week as the sea of other retailers report. I guess that's my kind of wrap up point.

I don't think I've got anything else. Guys. Anything else before we close it out?

[00:36:36] Bob Lang: That's it for me.

[00:36:37] Lindsey Bell: You got it.

[00:36:38] Chris Versace: All right, Lindsey. I will share that if Bob is using AI to capture his caloric intake, I'm hoping you will report back at some point in the new year that your aging pc is replaced by a new one with AI maybe?

[00:36:53] Lindsey Bell: Yes, I'll report back.

[00:36:54] Chris Versace: All right. Excellent. Excellent. All right folks. Thanks for tuning in to this week's episode. Be sure to check the show notes and the resources for more, but between now and the next episode if you need more from Lindsey Bell take a look at what she's posting on linkedin read her newsletter The Shift. If you need more from Bob, head on over to Explosive options.net. And if you need to find me, Chris Versace, you know what to do. March on over to the StreetPro Portfolio. Thanks for listening. We'll be back with you next week, even though it's a short holiday week. We will still be with you.