Joining me a. R. Gibbs. And john eckridge. Erin, we were talkin talk wee talking before the show. Who a weekly letter to our investors letting them know what was going none the market. Charles did you use a lot of whiteout . There is still a lot of debate on what triggered this which makes it hard to understand how we find a bottom if we dont know what pushes us over the cliff in the first place . We are seeing a huge selloff. We know we are going through a reevaluation period. There wasnt really any new big catalyst for the selloff today. You have got to reevaluate, what are you willing to pay for equities given there are some good starting positions. The economy today, we saw jobless the claims at a 45year low. Corporate earnings continue to be extraordinarily strong. Along with strong guidance. What do investors base this on . Do you make adjustments with the metro outlook for you the comed overall . Is there a negative wealth effect going on that could change all your work . We are down 3 for the year. People wont notice that on your statement. It will look like your december statement at this point. I think for now investors need to remain calm. For us things are starting to loolook attractive and we are getting to more reasonable valuations. Charles coming into the last couple sessions, investors werent panicking. But the last 48 hours they are getting more concerned. Fear can create additional fear. Is that part of the process, though, down vestors standing right now pretty firm, do they have to be spooked out of this market to find a bottom . I think that kind of today it laying is needed. I thought we might have gone the it on tuesday. But i think, you know, the big thing on that fear is we have been walking through the plains of kansas and we hit a tiny hill and we think its horrible because things have been so smooth and easy getting here. There is one thing folks are missing. We heard Interest Rates and the bond rates are going higher and that is what is spooking people or macro economics. I think both of those can be quickly count. If Interest Rates were the problemming financials wouldnt have been the down mover. What we are having here may be a classic mini tbhubl volatility. All these volatility instruments have blown up. Especially the inverse volatility instrument. There has been a short volatility trade for a year. I bleach thats about over. Im getting kind of optimistic. Charles it may be a while before we complete the postmortem. But it does recall, john, 2 2007 and 2008. And all of a sudden the values of their homes are half. We are not talking about anything like that, are we . No. Back then the backdrop was different. The world was going into a big downturn. And thats not where we are today. Looking forward 12, 16 months out thing look pretty rosie. Valuations were a little stretched and now they are more rational. This is a volatility extra lever etf selloff correction and it should stabilize from here on out. Charles two week ago we heard the dollar was too weak and mnuchin shouldnt have made the comment he did. One of the issues i have is every day its a different culprit. Are we adding more hysteria to this as we grapple for answers . Every type they turn on tv there is another reason du jour. At the end of the day this market has not had a decent correction in well over a year. That really is the reality. The market doesnt been down 4 last year. Going into late january. So we are only down 3 for the year. I think calm, coolness is the right call. If you are an investor in this market i would be nibbling at the valuations. Charles right now the world has the wind to its back and it feels like we are going to take another leg up with respect to our economy. But can we be victims of our own success . Is there a point when things can get too good and will that justify the market being lower . I think this is more we dont have to go as far back as 2008. We had a flash crash and we saw the viks spike up. The vix spike up. It added up for the year with a lot of choppiness. And it still ended flat at the end of the year. Well have volatility and down days, we have have reevaluation and we can end up with an up market by the end of the year. Definitely its the first time. Charles d. R. This most of people are sort of saying most of experts are saying we have been through it before. We dont want to dismiss the worries of folks who havent been through this before. But what happens if it does keep going down. When do you start to change your mind if this doesnt stop . Thats a great point. We are at a good Inflection Point right now. We have hit the lotus day, and below this are the overnight lows between monday and tuesday. So this is a very important point for to us look at. Going down below here, we are still a long way away from many of our technical analytics. We have the correction now. If we tack on another 3 to 5 below this let me ask you about the moving averages. I like to use the 50 and 200 day exponential averages. Is it conceivable we have to test 200day moving averages . That would mean a lot more pain wouldnt it . That would be a bunch more pain. If we got down to the 200 here, Something Else will have to break on ther than the investor fear and the overboughtness in this volatility crash. Everything else is looking too good on the macro side. Charles what are you telling your clients . We are seeing a sea change from a doveish to hawkish. Charles when did jay powell become a hawk . He needs to address inflation. He is more doveish in general, but the fed will have to start fighting more inflationary pressures. The q. E. Is done. Charles the senate ready to vote on a twoyear senate deal. But one republican senator Holding Everything up. Its easy to think that all Money Managers are pretty much the same. 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Charles that of the senator rand paul telling neil cavuto why he will vote no on the budget deal. Jason chaffetz, former chairman of the House Oversight committee. You think hes doing the right thing here . Lets have a tiny bit of a debate. Senator paul brings up a good point. Hes saying lets vote on an amendment to hold the budget gaps in place. This is a multi trillion dollar commitment the United States is going to make and they have had almost no debate. A lot of frustrated republicans. Senator paul is saying in principle you are opposed to obama deficits but in favor of trump deficits . Charles the republicans cried, screamed and warned us every single day that president obama was running up the credit card. Now that they have the credit card they run out and use it. You dont come out and say you have got a deal unless you already know you have the backing of the rest of the party. They may still get to 60 votes. But you have fiscal hawks who wont vote for it. I think a lot are teetertottering. I dont know what will happen in the house. You have a split in the Freedom Caucus as to whether they would vote for it. But the democrats should take this deal. It gives them everything they asked for. Charles when Chuck Schumer was talking, it was like he was talking to nancy pelosi. There is nothing that got cut. Charles the Freedom Caucus and nancy pelosi join forces and hold their ground. Are we in a bizarre world . Nancy pelosi has been all over the map. I dont know what she is trying to prove. She was in favor of it, then she was opposed to it. Now she is in favor of it. At one point democrats were quhipping people to see where necessity were at, if they were against it. Everybody is trying to play hot potato. They dont want to vote for it so they are trying to get their neighbor to do it. This has a debt ceiling it that nobody wants debt yilgt that nobody wants to be kobled with. Charles we are getting rid of the sequestration. I voted against that, by the way. Charles it feels like there is no other form restraint for folks when they get to d. C. They just all spend spend spend. The problems we have arent a revenue problem, they are a spending problem. You keep using that credit card time of and time again. Rand paul is making the point, when the democrats are in charge, the republicans have all this beer muscle. But when they have the levers of power, they are putting record spending at 13 in discretionary spending. I cant believe there is a single democrat that hesitates at this. Charles they have to be playing an odd, weird game. We talked about 7 00 being somewhat important. Is it critical he stops before 7 00 . I was told he will try to hold the floor until after 7 00 that will push the window to hold the government in a shutdown. They are telling the people in the house be ready to vote at any time. They dont want this to have the light of day. More sunshine on it, it is full of spending you have never seen before. Charles we are going to continue our coverage of this battle on the budget with an allstar Political Panel next. So from the two trucks over here. I want you to pick a new truck for your mom or dad, knowing that they could possibly pass it down to you one day. Oh. Cool. But before you decide, you should know that chevy silverados are the most dependable, longest lasting fullsize pickups on the road. Which means that ford f150s are not. giggles which truck would you pick . The chevy. There you go. Boom. That was obvious. Plus it looks cooler. No doubt about it. Now they know what to get me. Mom stuffynosecold nosleep mouthbreather just put on a breathe right strip it instantly opens your nose. Up to 38 more than Cold Medicine alone go to breatheright. Com today to request a free sample. Charles republican senator rand paul is holding up the senate vote on the budget deem as the midnight deadline quickly approaches. Here with me now is deneen borelli, Allen Stuckey and mark lauder. Let me start with you, mark. You know a lot of the key players involved in this. Some people are somewhat surprised republicans are in favor of such a massive spending bill, removing the restraints that will make our 20 trillion in debt mushroom that much quicker, particularly given the fact that Interest Rates are going up. You have to get 60 votes in the senate. There is no way they will vote on anything that would control spending. Thats not the democratic way. The democrats were insisting for every increase in military spending, we also had a spend a dollar on domestic welfare programs. We need to elect more republicans to the United States senate so we dont have to go to the democrats and constant lire get those votes which drives up our deficit. Hand pace our ally in this. He gets it. This is a huge, massive measure im surprised so many republicans are for. It might can the only thing on the table. But i understand rand palms complaints when said this shus shouldnt have bent process. It shouldnt be a process where a few people go behind closed doors, come out with a measure and say vote on it or else. Charles as you were speaking rand paul had notice board put up. A streetcar named waste. A 1. 6 million streetcar. We got money, right . Trillions of dollars pour into the coffers, and government spends more, no matter what. And part of that is the waste. And it makes people sceptical. If Chuck Schumer is for this, you now its a bad deal. But in the real world, anyone who works for an employee i will get back to you in five months with what you need. Congress works for us. Their job is to pass a budget when it is due october 1. They are failing americans and need to do their job. In the long term it runs up the debt. This takes the budget deal off the table because everything is about the election. Im not sure why rand paul is dissing dolly parton. But hes showing egregious examples of government waste. You are still saying the democrats are strong arming you. If its that bad. If its that tough, why doesnt Mitch Mcconnell change the rules in the senate to get this done the right way to save the American People the pain of this stuff. A year ago the president had his first budget blueprint which balanced over the course of 10 years. They will put out another budget blueprint monday that will cut trillions of dollars in the deficit and reduce the gdp. The president is taking the steps to show leadership. Charles mcconnell is going to use the Nuclear Option . Lets remember. Look at what happened to the judiciary when the democrats went to the Nuclear Option. They came to regret that later under President Trump. Charles if you went there and got things done and the economy grew the way you think it will grow. Do you think Mitch Mcconnell should change the rules . Yes, i do. I think that was a great suggestion. Charles thank you very much. In the meantime markets are down, but Consumer Spending is rising and markets are through the roof. But is the economy Strong Enough to turn the markets around . Well discuss that next. With fidelitys realtime analytics, youll get clear, actionable alerts about potential Investment Opportunities in real time. Fidelity. Open an account today. How do you win at business . Stay at la quinta. Where were changing with stylish makeovers. Then at your next meeting, set your seat height to its maximum level. Bravo, tall meeting man. Start winning today. Book now at lq. Com charles well despite another major selloff in todays trading Consumer Spending continues to rise as demand demands for goods and services continues to really mushroom. Im calling this the golden age of materialism. Americans arent holding back from buying designer brands and they dont care how much it costs even if it means putting the purchases, here is to discuss the chief Research Officer at H Squared Research and analyst of course and eric schiffer, chairman and ceo of the patriarch organization. You know, im looking at these earnings the last couple of weeks, coach which is now called tapestry, crocs, michael kohrs, and theyre blowing them away doing extra ordinarily well. Even on the more basic level amazon had a little bit of a dip today. Charles but their numbers were phenomenal, these are all Consumer Discretionary items, things that we dont need. How can people be out there spending this kind of money against the market thats doing what its doing. I mean which one would change first . Well theres two things. Number one its called frugal fatigue. Weve had many years of just the American Consumer saving saving saving because we dont know what was going to happen to the economy so people were saving, now all of a sudden now that they feel better theyre going out and sending but what people have to understand theres a difference between the market and the economy. Even though the market is having these really wild swings, the economy is going along as progressed and economists have been predicting we were going to have this. Charles but people are spending money on things like crocs, a pair of crocs, 850, sold out in a matter of hours, okay . Look at those folks. 850 crocs, all right . Is that a red flag to you when you see Something Like that . You know, we saw this a little bit prior to the recession, when people were going out and just spending relentlessly on the most silly things. You remember seeing kim car kardashian amid paris hilton, this was a little bit similar but this is a sign, i mean as i said, we have been building up to this and if we do see a correction especially what we see in the market so its probably going to happen but the sign that people are actually going out having the money to go ahead and make these discretionary purchases is amazing. Charles eric one thing we do know and we saw yesterday consumers are using credit cards more. Remember we shifted to debit cards during the Great Recession but now were more confident were using credit cards i guess theres a Tipping Point where we used them too much but a certain degree also is a reflection of confidenc