Vehicle i have is threatening to dominate the market. Can us automakers pull ahead of the competition and later, a big week for artificial intelligence, nvidias to blowout earnings. We begin with our expert panel if three things investors ought to be thinking about. Onbarrons roundtable,s ben levisohn, jack howe and teresa rivas is. Ben, we all think last week was scary, there was a bad drop in the market on thursday, but when you looked at the end result, the s p and nasdaq was up, dow was down a little bit. Yeah. For the dow, it was a terrible week, the dow was down more than 2 , but you look at the nasdaq, it was up more than 11, and the s p 11 and the s p did absolutely nothing. And there were lots of reasons being thrown around whether it was the fed minutes, rate hike fears, but really it just come down to nvidia. The chipmaker came out with earnings, jumped Something Like almost 10 . And whether you owned nvidia or not really determined whether the index went up or not. Nasdaq owns lots, s p owns a good chunk of it but not as much, and the dow owns none. It only owns intel. And that really determined which index was up and which one was down. Jack you wouldnt suggest investors or back up the truck for nvidia, right . Most of us actually own it through an s p 500 fund or an activelymanaged mutual fund. Thats right. If you own an activelymanaged s p 500 fund, you have a stake in the stock. This is its the Third Largest 40 holding in the spy etf that follows the s p 500, so you really dont need to buy another chunk unless you think nvidias going to keep going occupy. I just think getting that concentration, youve already got enough. Jack that makes sense. 9 a long weekend, a few earnings reports will trickle out, but really inflation is on everyones mind. Thats right. Well get costco, salesforce. Com, but theyre not going to move the market. Pce contained the feds favorite inflation metric, the core pce, price index is supposed to rise about 2. 8 , the same as last month. We really need to see that start moving down. If theres a surprise higher, its going to be bad for this market. Welcome backing jon teresa, a tale of two retailers. The week before last walmart came out with great earnings and projected good things. Target came out this past week, not so much. It pains me to say this as someone who is target all the way, but it honestly feel like walmart is the new target and vice very or saw. If youre thinking of a pleasant Shopping Experience in a wellstocked, bright store, you used to think target whereas the new walmart supercenters look like that, and target are the stores that are kind of dingy, not well staffed, running out of stock. Its unfortunate, but i feel like that is really playing out, and you see that in the earnings. Theres the question of closing selfcheckouts to reduce shoplifting. Targets been successful there, but at what cost . I personally have walked out of the store without buying things because tonight i dont want to wait for the for two cash registers that are open. Jack im not sure, but it sounds as if the whole store experience is becoming more targetlike, and theyre doing other things well too, right . Certainly. I think weve seen them increase the range, and you see a lot of high income americans shopping there now p. And walmart makes that a easy with Something Like walmart plus, their subscription service, and theyre doing a lot of other things right too in the terms of branching out into advertising and other high margin businesses. Jack yeah, they have so many people coming to hair web site, they can actually their web site, they can actually sell advertising. Absolutely. Those eyeballs are valuable. The same way as they are on amazon. Jack jack, you flew back from houston just in time to experience a terrible storm up here. Whats the market connection . Well, were coming up on the start of the atlantic hurricane season. Thats june 1st, it runs through november. Noaa, the weather science group, they say its going to be a double doozy. Its the highest probability ever for a bad storm season theyre predicting, and theyre also predicting the greatest number ever of named storms. We could get all the way from al a berto through william this season, and you should say a prayer for your Homeowners Insurance because costs are soaring, and companies are getting choosier about their coverage. In houston, freak storm knocked out power for a million people. One woman said her roof was damaged, shes not sure how shes going to the pay for it because she wasnt able to get coverage from a private insurer, she had to to use state coverage which she said is not very good. I come back to westchester, new york, freak hailstorm took down branches all over my town. Among the the scale of houston, of course, but a lot of people are wondering is the wacky weather coming for them next. And financially it might be, because there were 8 states that ran losses 18 states that ran losses last year in the Homeowners Insurance business. And so, you know, as i say, thats causing companies to raise their prices and to get picky about what a theyll cover. Jack its really difficult for homeowners. Im wondering though what a does it mean for the Insurance Industry . Are they going to be able to raise premiums enough to cover the potential losses . So the way it usually works, you know, you get this base level of storm, one really bad year the Insurance Companies run a loss, everybody raises prices, and then investors actually turn bullish on the stocks because they figure, okay, the prices are going to stick, the higher rates are going to stick, and were going to go back to normal on the level of damage. And weve actually seen some of these stocks running up9 lately. The problem is if noa a as right about the coming hunger season, and if we do see this higher base level of storm damage, the biggest increase in storm damage, in damage around the country hasnt been from hurricanes or wildfire, its just been from severe storms that that arent are hurricanes. So we see this higher base level of damage going forward, it might not be so profitable for insurers, and we might see a continuation of rate hikes. Jack and theres still some nice communities toward the north that are very vulnerable. Thats going to be ugly all around. Thank you, jack. All right, the investing landscape has entered a new regime according to my next guest, and shes out with a playbook. Global wealth strategist Paula Campbell roberts joins me next. And when i got there, they have the sushi this is clem. Like sushi classy clems not a morning person. Im tasting it or a night person. Or a. People person. But he is an i can solve this in 4 different ways person. And that person. Is impossible to replace. You need clem. Clem needs benefits. Work with principal so we can help you help clem with a retirement and benefits plan thats right for him. Im short but im. Im confident. You know . Let our expertise round out yours. Do you want to close out . Should i . Normally id hold. But. Taking the gains is smart here, right . Feel more confident with stock ratings from j. P. Morgan analysts in the chase app. When youve got a decision to make. The answer is j. P. Morgan wealth management. Music unnecessary action hero unnecessary. Was that necessary . No. Neither is missing your daughters competition to do payroll. With paycom, employees do their own payroll so you dont have to miss your daughters big day. Time to shine. Get paycom and make the unnecessary unnecessary. alarm sound amelia, turn off alarm. Amelia, weather. 70 degrees and sunny today. Amelia, unlock the door. Im afraid i cant do that, jen. suspenseful music why not . Did you forget something . suspenseful music my protein shake. The future isnt scary. Not investing in it is. Youre so dramatic amelia. Bye jen. Nasdaq100 innovators. One etf. Before investing, carefully read and consider Fund Investment objectives, risks, charges, expenses and more in prospectus at invesco. Com. Jack higher interest rate, rising geopolitical techs and an Election Year are all playing a role in aloe indicating money. My guest has an investment playbook to help navigate markets. Joining me now, kkr chief investment strategist for Global Wealth paula a campbell roberts. Thanks so much for coming in. Thanks for having me, jack, a pleasure. Cc jon you are firmly in this higher for if longer camp, but some of the forces that convince you thats the case might surprise some people. Lets start with a. I. Everyone says its going to makes more efficient, maybe replace some labor. Those are disinflationary forces, with but you think it could be inflationary. Thats right. The belief is a. I. Will pull the seam out of inflation, but in reality if you think about the infrastructure from water usage to the use of energy and even labor which is in short supply today, because of those that will drive up flakes in the short term. Jack another trend your looking at is immigration and demography, and you think that demographics could been inflationary as well. Thats exactly right. For a while weve been talking about the aging demographic, right in the aging of the population jack and theyre supposed to spend less, right . Exactly. Now, fast forward to covid when you also had excess retirement, the resulting labor shortage a is what is driving Wage Inflation higher which is supporting the elevate leveled of services inflation. So demographics are inflationary. Jack lets talk about the investment playbook in this scenario. You focus on private markets but, real quick, if you were restricted to Public Markets, what would your advice be . Absolutely. If you think about large cap public equities in particular both in the u. S. And europe, theyre both suffering from a concentration risk; that is, 711 stocks depending on the region are really driving the performance in both indices in the u. S. And europe. Thats a problem if you think about what most 6040 or balanced investors believe that theyre invested in. So whats critical for investors in Public Market is the is to seek questionersification. So if youre diversification. If youre a u. S. Investor, i would say seek regional a diversification. Europe looks attractive but also japan, for example. Jack yeah, japans been doing very well. And to your point, you own the s p 500, but its mostly 10 stocks. Exactly, its 7. Jack people probably dont understand that most of the economy is not the s p 500, its actually private companies. Thats with where you play. And weve actually seen a trend toward fewer Companies Going public. The wilshire 5000 only has about3 000 stocks. Tell us why you like private markets. Well, the start with, if you talk about the opportunity set, since 2012 the number of Public Companies in the u. S. Has been shrinking by 30. Globally, that number is closer to 50 . So if youre just ans investor and, again, seeking diversification, why would you limit yourself and only limit yourself to a smaller opportunity set . So, first and foremost, invest in private markets because thats where the with bulk of the opportunity lies. Jack all right. Now, youre going to be careful about, i know, talking your book, but ill talk it for you which is to say there was just this announcement as reported in the wall street journal late last week that kk kr was partnering with are retailfocused mutual fund company, capital group, to come out with these hybrid etfs that will be partly publiclytraded bonds but also private companies. So can you go into a little more detail for us about what a you think the benefits to adding them to your 401 k or your investment though sis would be . So private markets will help investors achieve some of that diversification, volatility mitigation and help boost returns. Thats critical in terms of the value proposition. Now, when we think about private markets, institutions have relied on private markets for decades, but until recently, only ultrahigh net if worth individuals could access those the same investments via drawdown vehicles, for example. With this new announcement that weve mentioned by a capital group, and i think this is the direction the industry is headed in, nonaccredited investors have access to these very same sluices. Jack unfortunately, we dont have have a time to do a deep diving but another benefit can be that because its not sold as frequently, theres a little less pressure in bad time, right in. Thats absolutely the case. Thats part of the reason why you have this premium which is the excess if return of private market over Public Market, and in private equity that has average over time increased. And in the market we foresee over the next five years driven by the same factors you started out describing, volatility is the same thing we expect, so is this is a time where private market should outperform. Jack paula carp bell roberts, thank you so much campbell roberts, thank you so much. Thank you, jack. Jack chinas electric vehicle success driving concerns here at home. Our expert panel looks at how u. S. Automakers can pull ahead, next. When enamel is gone, you cannot get it back. But you can repair it with pronamel repair. It penetrates deep into the tooth to actively repair acid weakened enamel. I recommend pronamel repair. With new pronamel repair mouthwash you can enhance that repair beyond brushing. They work great together. Fisher Investments at Fisher Investments we may look like other money managers, but were different. other money manager you cant be that different. Fisher Investments we are. We have a team of specialists not only in investing, but also also in financial and Estate Planning and more. other money manager your clients rely on you for all that . Fisher Investments yes. And as a fiduciary, we always put their interests first. other money manager but you still sell Commission Based products, right . Fisher Investments no. We have a simple Management Fee structured so we do better when our clients do better. other money manager huh, were more different than i thought Fisher Investments at Fisher Investments, were clearly different. Jack from clothes to toys and electronics, the made in china label has flooded the u. S. Market. The Biden Administration if has announced a 100 tariff on electric vehicles em ported from beijing this week trying to protect american manufacturers. Former President Trump says hed raise tariffs even higher. With but the threat might be overblown if u. S. Automakers step up their game. Its the barrons cover story this week, and associate editor al root joins the pant al, great story. I learned a9 lot of stuff. Lets start be i really did the alliance for american manufacturers says chinese evs,s quote, could end up being an an extinction 2006level event. Whats driving all this concern . I dont know why i should be surprised you liked it, but that always surprises me. A 10,000 car just isnt the threat that you thinks it is. Byd is a real competitor. Theres lot of reasons people are afraid. Chinas the largest market for new cars, the largest maker of electric vehicles. Byd is, makes made 3 million electrified cars last year, in the Fourth Quarter they actually sold more allelectric cars than tesla, so theres lots of reasons that you should be afraid. But we can get to the 10,000 car in a a second. Theres no chinesebranded car sold in america right now, no chinese capacity on this continent except if a small joint venture plant in mexico. The chinese will export cars, theyre going to start in europe, and they also ship cars to Southeast Asia and places like that. The threat for the u. S. Is literally a decade away. And that a makes these tariffs to some extent politically motivated. And you can even see that in this sort of bang and forth of i can raise tariffs higher than you. Jack the yellow car is called the seagull. Im not rushing to the dealership for one of those, but i could see a recent grad, a 10,000 electric vehicle, hey, that sounds like a good deal. Yeah. And its not that nobody likes a good deal, and its not that but the thing about the seagull, its just not magic. General motors can make cheap cars too. They have a 5,000ev in china. The market sort of decides the kind of cars that you purchase and, you know, those college student, you know, the cheapest 10 cars in the u. S. , they garner about a 6 of the market in 2023. Thats the market for the cheapest cars. And then the kind of market that youre in whether its china or india, mexico or here, that sort of sets the price of the cheapest cars. You know, like, youre not going to run out and buy the seagull because americans tend not to want strippeddown, cheap car, you know . Its always a nice headline, we use the you go analogy in the if story yugo, it was a 4,000 car and it seems great, but then service is a progress, reliability is a problem. Its actually a progress, its very expensive to get it fixed. Remember, the upfront cost is only one portion of the equation there. So what do you think u. S. Automakers need to do to head off this chinese competition . So the way i liked it best, we were chatting with the president of volkswagenamerica, and he was sort of pragmatic. Hes a foreign automake pear with capacity in the u. S. He said, listen, these tariffs cant last forever, it gives you sort of 10 years to get your act together. So what do you have to do . You have to, you know, when ford and General Motors faced the threat from the japanese over the last 40 years, they were content to just sell suv and trucks and cede all the rest of the market for smaller cars to imports. Not exactly the best strategy. You have to build a full lineup of attractive cars, and you have to defend market share. You have to compete. You have to sort of strategically say, all right, what am i going to do . You know, for ford i think they should be very careful to protect smaller truck share. General motors is introducing cheaper evs this year. They should continue to do things li