the stock market just hit an allnew High the NASDAQ the S&P 500 and the Dow Jones are rising close or at their all-time highs on Monday all the major indices gained another half a percent or more the NASDAQ gained a full percent even with Salesforce being a dud recently my portfolio has reached close to its all-time highs now at a gain of $213,000 Apple's at an all-time high of $216 Microsoft has reached an all-time high Microsoft is now $448 per share Texas Roadhouse is next to its all-time highs it's at $171 per share currently up 43% year to date Chipotle is at an all-time high currently $3,365 per share and up 50% year-to date Costco hit an all-time high today is currently $868 per share up 34% year-to date not only is the passive income portfolio near its all-time Highs but the story fund my smaller but more aggressive growth portfolio is currently at all-time high with a gain of 7,300 Google's currently 1% away from its all-time Highs at $178 per share Netflix reached a 52e high today it's now at $675 per share up 44% year-to date and these are just some of the stocks in my portfolio there's other notable mentions that are racing up or close to their all-time highs Tesla's making a nice comeback it's close to $200 per share but other companies have really Blown Away the rest of the market Nvidia being the main one here it's up 171% year-to date with the market being at all-time highs and racing up every single day day after day it raises a lot of questions what do we do in these situations a lot of investors believe that we should hold off we should hold cash we should wait for a dip but there's more science to it there's more data that will clearly illustrate what the best decisions are to do and I'll be going over what the data says how we should invest during bull markets and during all-time highs now of course we have some other new stories get to in this episode as well including that our Surgeon General is now pushing for a surgeon general's warning on social media very similar to the Surgeon General warning on cigarettes and we have news that the US is officially suing Adobe over deceiving subscription practices claiming that adobe products which are very expensive are simply too hard to cancel so we have a lot to get to in this episode I appreciate you for joining let's go ahead and dive in first starting off with what do we do in a bull market this is something that there's a lot of opinions about everybody wants to know should we buy or should we wait should we wait for a dip what decisions should we make in this type of environment now the first thing that everyone seems to do in a bull market during all-time highs is try to predict when it will end try to predict when things will finally fall apart and we'll go back into a bare Market this is like the debate phase of the bull market and you hear these type of debates during every single bull market in fact we just heard this debate today but in an election year and I came on with Scott a while ago talking about this you attend to see your summer rally right June July August usually really strong so we're still in that strong seasonal uh time frame Mike and then like I like to look at credit spreads right investor great corporates uh what's going on there the there's no monster under the bed right we're not seeing any major stress in credit markets we're hitting literally the 30th all-time high of the year for the S&P as we as we sit here and talk today so there's always worries concerns but bigger picture we're overweight equities we have been since December of 22 Mike we still think there's pretty good upside the second half of this year coming he's stressing that right now we see a bull market that's consistent with many election year summer bull markets it may cool down a bit but this is the type of commentary I see every time during a bull market you have people brought on many guests debating the intricacies of what's pushing the market higher in many cases these are short-term focused outlooks they're looking over the next year and trying to debate whether or not the market will continue higher or go lower so we have bullish takes like this that the Market's going higher and it's going to have a little bit of a break but it will continue higher and then you get the other side where they bring on guests that give their reasoning of why the market is going to go lower here's an interview from a few months ago during a Raging Bull Market why a market correction is long overdue and this Market's going down we did not see as many strategists didn't see last year coming right the recession that wasn't and that held us into a more conservative position and didn't reap the benefits of especially that fourth quarter run up in stocks but um you know we're not out of the woods yet the way we see it and you certainly don't need me to to read off that laundry list of uh economic and geopolitical uh you know issues that we're still facing but I guess we'd argue that whether or not there's a a soft Landing or a hard Landing SL recession which is the current debate that we see that as academic um stocks have already priced in a pretty Rosy scenario here for the most part and so we don't necessarily see where the fuel is going to come from for much higher stock prices uh uh relative certainly to to fixed income securities he's bearish on stocks he believes that they've already priced in a bright future and there's not much reasonable upside the S&P 500 reported earnings and those earnings were much stronger than expected causing the stock market to sail upwards and on goes the endless debate of what direction the Market's going l for us we have much better data to look at one of those pieces of data that mirrors a lot of other studies on the subject is a study called investing at all-time highs by RBC Bank they highlight early on in this study that the problem with the market racing to all-time highs is a lot of people stop investing they hold off investing because they have something called a psychological barrier to entry another phrase for this or another psychological thing to explain this is called anchoring bias anchoring bias is a well-studied phenomenon where you started investing at a certain point like let's say I start investing back here and the market raced up my portfolio made gains so I no longer feel like I'm getting good value in my portfolio because remember when I was buying it all the way down here that was such a better price now things are more expensive so I no longer want to invest anchoring bias is where you no longer make decisions based off of the current data because you're mentally and psychologically anchored to a different point in time they say that they may question whether it's the best time to put new money into the market after all investing at all-time highs means you're paying a price that no one has ever paid before creating a seemingly guaranteed recipe for regret I mean honestly who's buying the S&P 500 today they're paying an all-time high price for it more than any other investor has ever paid for the market But ultimately this type of behavior of anchoring bias or the psychological barriers to entry is another form of Market timing investors that do this are trying to time the market they're trying to avoid buying at Market highs and only buying up Market lows timing the market is almost impossible to get right and the market trading near or at its all-time highs is not uncommon so you would be missing out on a lot of opportunities if you try to avoid them this is actually one of the most counterintuitive topics I can think of where buying the market at all-time highs is one of the best things you can do financially for example since 1950 the broad US Stock Market so we're referring to the S&P 500 has set an all-time high record 1,250 Times breaking this down by decade in the 1950s there were over 137 all-time highs the 1960s 218 the 1970s 35 the 1980s 189 the 1990s 310 the lowest amount was in the 2000s 2000 to 2010 was a really low point but there was still 13 times where the market reached an all-time high in the 2020s there's already 114 times the market has reached an all-time high this is something again that's so counterintuitive when I look at my portfolio and the massive gains it's made over just a short period of time it seems crazy to want to put new money into the market this year it just seems like you're doing something irresponsible you're buying stocks after they've already made gains and that's something that's not fun to do it's much more fun to buy companies when they've traded down to deep value territory I love buying stocks when they're at low valuations remember when Microsoft was $220 per share and I was pounding the table saying that this company's undervalued Microsoft could be worth up to $400 now the Stock's almost 450 it's nowhere close to 220 where it was just a couple years ago but good investors rely on good data they rely on good decision-making that's been proven over time and the data says that the market reaching an all-time high and stock prices going up is not a reason to stop buying in fact if we break this down in different hypotheticals we can see how much of an impact this actually has for example if you only were to buy at all-time highs your returns are very very similar to buying at any other date if you look at this study right here it examines the difference in returns over different time periods if you only buy at alltime highs your average return over a oneyear total is 11% so saying that you bought the top of the market you're the worst Market timer ever you're only buying at all-time highs you earned an 11.2% return on average if you bought at any other date averaged out your return was 12.6% you had a marginally better return buying at another date than alltime highs and in my opinion the difference is not enough to make up for not buying sitting on the sidelines is incredibly expensive if we bring this out to a three-year period your average return buying at an all-time high over 3 years is 10.9% if you buy at other time periods where the Market's lower it does increase your expected return but by less than 1% it only goes to 11% .5 from 10.9 this is a very marginal difference if we look at this over a 5-year period the difference becomes even smaller from a 10.3% average return buying at all-time highs to an 11.3% buying any other time that's a 1% difference marginal difference buying at other times this data is again counterintuitive it goes against all pre-conceived Notions investors believe that by buying at all-time highs they're being irresponsible and they're setting themselves up to lose a lot of money but the data simply does not support these type of assertions that we make if we look at another study this time from Fidelity we have a comparison over time of the growth of a hypothetical $5,000 investment this is an all stock portfolio under different conditions versus investing in cash and this is from 1980 to 2023 so this is very applicable data to investing in all-time highs if we had the best timing possible your return would be 5.6 million which is incredible to turn that much money into 5.6 million now if you just invested the money right at the start of the year and had no timing skills whatsoever you still made $5.1 million so notice the difference between the best Market timer in the world if someone existed that could possibly do that which they can't the difference between them and someone that does nothing that takes skill all they do is they invest at the beginning of every year is only $500,000 out of 5.1 million that's again a marginal difference between the best timer in the world and someone that's not timing anything then if someone invests monthly they have a little bit lower return because they're taking longer to put their money in that's 4.8 million if someone has the worst timing ever and are only buying during the worst times they still turn that money into $4.2 million what this really illustrates out of these five different scenarios here is that there's four winners and one loser the one loser is the one that sits in cash because they're too concerned at buying at all-time highs the people that are convinced that they're going to earn a higher return putting a bunch of money in their 5% interest rate cash account are the real losers they're the ones sacrificing millions of dollars over a 40-year period because they're too concerned about buying at different time points the worst investor the one that had the worst timing possible still has over an order of magnitude more money than the smart investor that cautiously put his money in cash so again we can have these debates of what the markets going to do and if we're going to run into a recession if the elections go a certain way and the market crashes we can debate that in and out every single day and these are fun little debates to have on CNBC and on different social media channels but even with those debates my advice is always the same it's the same thing I'm doing with my portfolio keep buying stocks every single week every single month every single day if you can buy when the Market's High buy when the Market's low buy stocks all the time timing the market is impossible nobody can do it with any degree of consistency or accuracy the biggest Market timing losers investing at the worst times possible still end up with far more money than people sitting in cash I'm following my advice as well even though my portfolio has reached near its all-time highs and things are going really well with the gains of my companies I continue to add money to this portfolio periodically and add to companies that I think are the best value possible it is true that it's getting tougher to find Great Value in terms of Market multiples and valuations but I do the the best I can I try to buy the companies that I think are the most reasonable valuations possible when the market's at an all-time high that doesn't mean that every single company's at an all-time high some companies currently present better valuations and opportunities than others for example on qualcom which is a website that I developed this is something that's available to all patreon members there's a feature called The dipf Finder this is something that I've been using for years it's very helpful in visually seeing how my stocks are trading this right hand that's in the green are all my stocks that are are trading with momentum moving upwards the more they're in the green the more momentum they have right now my food companies are the ones that are like rockets going up 40% year-to dat Texas Roadhouse is on fire they're just killing it well I think everybody knows about Chipotle this stock is just like a rocket it's doing so well this year so I'm not buying these companies I haven't put a buy in for Texas Roadhouse or Chipotle this year I'm just letting them run I'm not selling any of them but I'm still letting these stocks run another company's Costco that's just crushing it it's too expensive for me to buy at this point but I'm going to let this one run I don't like trimming my stocks that have strong fundamentals moving in the right direction then we have apple with an amazing recovery with their AI demonstrations we have Microsoft up to 450 now we have Moody's making a nice comeback but then we start getting into a territory where these stocks really aren't trading with a lot of momentum S&P Global has been a little bit meh it's it's in the green it's been a decent holding but it's only up 4.62% above its 200 day moving average the 200 day moving average is a technical indicator for the momentum of a company and so it's showing that this one is in the positive it has a little bit of positive momentum but not much and then MasterCard is basically flattish barely positive and the same thing with into it into it hasn't moved much at all so I find these ones a bit more interesting they catch my attention they're ones that I look at as potential buys I could potentially add to these ones at decent valuations but then we get over to the ones that are actually moving down not only are these stocks not moving with positive momentum but they're selling off this year Canadian Pacific has not done well the company's doing well but the stock price hasn't cooperated then of course we have vichi with interest rates going up it's put downward pressure on companies that have long-term duration instruments like the contracts they have with their tenants this is the opportunity cost of investing in real estate but then the worst stock of of all my worst Loser by far this year is Salesforce not only does it not have positive momentum this one is minus 10% under its 200 day simple moving average this is a stock that has negative sentiment negative momentum my favorite situation is when a stock is moving in the wrong direction when people are becoming bearish on it when they're saying that the stock is over that software is over that the new trend the new thing to invest in is Hardware they're semiconductors Nvidia AMD tsmc asml all the different Hardware companies and software companies like in and sales force are no longer the thing to buy and so I'm buying it if I go to my Salesforce position I bought another $2,400 of this stock and I've made a series of purchases since it had its huge selloff after earnings I don't know when this stock will recover it could trade around with negative sentiment for a year or two but that's something I'm willing to be patient with I think given enough time if they continue to go along their path of growing free cash flow per share keeping their stock based comp under 8% of their revenue and only doing a create of transactions I believe this stock will continue to go back up to all-time highs so when I'm allocating new money during a bull market I'm doing it within the segment of my portfolio that's not a bull market right now the bull market portion of my portfolio is this portion most of the stocks I own are in the green but in every index and in most portfolios there's a couple stocks that aren't keeping up if those stocks still have positive fundamentals I think it's a to buy and in my case the stock I've selected is Salesforce so you can do whatever you want with your portfolio but as far as I'm concerned I'm continuing to buy now let's go ahead and move on to some news here we have news that the Surgeon General is now calling for a surgeon general's warning expressing how bad social media companies are for children Surgeon General Vivic Murthy he wants to put a health warning label on social media saying it could be harmful to mental health especially for young people now it's going to be similar to the Surgeon General warnings that have appeared on tobacco and alcohol products for decades and Murthy laying out his case for the label which would require congress's approval by the way before it can happen in a New York Times oped this morning and in that piece he calls mental health a crisis for young people and points to research showing young folks who spend over three hours a day on social media have increased risk of depression and anxiety he also points to the success of the warnings on tobacco products which led to a decline in usage now so far Congress has passed zero laws regulating big technology companies that includes areas where there's pretty much Universal and bipartisan agreement that's of course protecting Children online from things like bullying or sexual predators now in the fall of 2021 a former Facebook employee Francis howan blew the whistle on the company releasing internal Facebook research from 2019 that showed social media could make young girls feel suicidal this is especially true on Instagram and among many other ill effects for mental health now part of mery's call today social media companies should share research just like that publicly don't keep it hidden and in the meantime meta has made some changes to child safety in recent months but only after a high-profile case in New Mexico's attorney general brought against the company and overall meta has argued the burden should mostly fall in the App Stores run by Google and apple to better police children's access to social media apps at the end of the day though no one with authority has done anything of significance at least here in the United States to to help solve this problem so there you have it you have the Surgeon General of the United States calling for a surgeon general's warning on social media companies presumably it would be when you sign up an account it would have this big warning similar to if you go and purchase tobacco you know there's a surgeon general's warning on Tobacco now my immediate thought when hearing this and seeing it passed around the New York Times Wall Street Journal and CNBC was that this is not going to change anything I don't think it's going to help anyone because he's doing something here where the Surgeon General is trying to point out the obvious as though it's some type of Novel Revelation he says quote the Mental Health crisis among young people is an emergency and social media has emerged as an important contributor this is something that nearly every single person on planet Earth that has access to the internet is aware of there's an overwhelming consensus that social media is not healthy for children you could take polls on this you can ask random people the majority of people will say that social media is not great for children especially in large amounts especially when they consume up over 3 hours a day doing any type of submerged activity on a phone for for 3 hours or more per day is not healthy the difference between this and the case of tobacco is tobacco had a Surgeon General warning in 1965 when it was still heavily debated of whether or not tobacco was healthy there was a huge movement saying that tobacco was healthy from the 1940s to the 1950s we got into the 1960s and it was around 5050 many people still believe that tobacco really wasn't n that bad for you it really wasn't a problem so in 1965 when the Surgeon General put an official warning on Tobacco that was a highly debated topic but there's no ongoing debate with social media if we have another warning on social media companies to match the other 5,000 warnings we've had about them this is just going to be another thing that you have to agree to that you have to look at before signing up an account which everyone ignores and does anyways now moving on we get to the news that adobe is now being sued by the US government for their deceiving subscription practices they say that the US government is suing Adobe for allegedly hiding expensive fees and making it difficult to cancel a subscription in the complaint filed on Monday the justice department claims that adobe has harmed consumers by enrolling them in default the most lucrative subscription plan without clearly disclosing important plan terms so they're kind of signing people up for the most expensive stuff without clearly laying out what it entails and then the lawsuit also alleges that adobe hides the terms of its annual paid monthly plan in the fine print and behind optional text boxes and hyperlinks in doing so the company fails to properly disclose the early termination fee incurred upon cancellation quote that can amount to hundreds of dollars the complaint says Adobe has a monthly subscription plan and you may believe when you sign up for that monthly subscription plan that you're going to be charged per month and then when you cancel you simply pay for the month year charge and you no longer pay anything but what Adobe is really doing is they're signning signing you up for an annual plan that's paid monthly so you've really agreed legally to an annual plan but you're just kind of financing it every single month and that way if you cancel your plan you're still on the hook for the rest of the year even though you thought it was monthly all along cuz you're paying for it monthly nope you're on an annual plan and if you cancel you have to pay hundreds of dollars that is deceiving and there's people that have been calling Adobe out on this on Twitter saying that it's deceiving one user says just WTF Adobe are you saying that if I don't need the software for 2 months I can't cancel the plan he has a screenshot saying that if he cancels his Adobe account you'll be charged an early cancellation fee of $140 as part of the original subscription agreement this fee will apply if you cancel now and end your annual commitment early so you're committing to annual plans paid for monthly and that's where all the confusion is coming in now on top of this deceitful practice of sneakily signing people up for annual subscriptions and then saying that you're going to be charged monthly the doj also alleges that adobe is making it difficult to cancel their subscription they say that when a customer attempts to cancel they have to go through an honorous and complicated cancellation process that involves navigating through multiple web pages popups and then allegedly ambushes the customer with an early termination fee which may discourage them from cancelling so you have multiple Pages you have to go through you have popup and then you're met with a cancellation fee customers encounter similar obstacles when attempting to cancel their subscriptions over the phone or via live chat subscribers often have their calls or chats disconnected or dropped when they're trying to cancel they have to re-explain everything over again the reasons for calling when they reconnect the lawsuit alleges that these practices break federal laws designed to protect consumers this type of behavior of signing people up for one thing and then tricking them into believing they're on a monthly tear when they're really on an annual contract and making it difficult to cancel a subscription should not be allowed the companies that I invest in make it incredibly easy to cancel their subscriptions C C subscription has a satisfaction guaranteed if someone signs up for a membership and then a few months later finds out that they don't like it and they're not using it Costco will even refund you the membership not only will they not charge you fees and make it difficult to cancel but they will refund you your original membership that is the practice of a good business Netflix makes it incredibly easy to both sign up for their service and to cancel you can go to your Netflix account anytime hit two buttons and your subscriptions canceled they do this because they don't want you to have the filling that you're locked into them that if you ever sign up for Netflix that you can't get out they know that by trying to trap customers into their service like cable companies that people become concerned about signing up they' become very hesitant to sign up Netflix makes it as easy to leave as possible because they don't want people to feel trapped they want people to feel like they can come and go as easy as they want for my own subscription for the exclusive videos for qualcom for my entire patreon I have the same practices it is a free trial that's up to a month long long you join with no risk and it's month by month cancel anytime with ease people that sign up for the patreon know that they're not trapped into something they're not being cornered into a membership people can come and go easily and if someone is charged and they aren't fully satisfied they can also get a refund this type of practice is consumer friendly making something easy to cancel is consumer friendly and ultimately it leads to better success if they're tricking customers and deceiving customers if they have thousands of unhappy people that's obviously a need for change and if adobe's not going to make that change the doj can pressure them now that's going to be it for this episode I hope you enjoyed if you want exclusive episodes additional content ask me anything and full access to calm.com you can check out the patreon like we've shown there's no risk to it other than that I'll see you in the next one
