Are piling up, folks. The number unissue is trust, or should i say lack of trust in a system that never fails to let down regular folks as it bails out the establishment t doesnt patter by the way which Political Party is in power. I will break it down during the show. The wrath of a. I. Is only the beginning. We see jobs and businesses overnight in the crosshairs and maybe humankind. Is it too late to ring fence this threat or is it much ado about nothing . I have an allstar roster of folks to help handicap the feds decision tomorrow. It means everything for your port he will. Economic house from main street, jay powell never hears from my takeaway. That and so much more on making money. Charles all right. So todays session is a reflection of fear, anger and disgust, right . Fear, the economy is a lot weaker than anyone in the fed circles will admit like jay powell. Therefore it means that probably will get a whole lot more tenuous. Fear about the banking scare. Maybe it is not over, particularly as worries about commercial real estate start to heat up. There is fear underscored by the second fastest monthly decline in job listings in history. Which suggestion that recession is right around the corner. As far as anger is concerned the fact that the Playing Field remains unjust. Reports this morning, perhaps the ceo of coinbase and a board member, Silicon Valley titan Marc Andreessen avoided one billion dollars in losses by using Insider Information to sell day as of the company went public. There is disgust, folks, the people in washington cant seem to get their act together. Even issues that we think should help, actually become props, right . Opportunities to legislate, come promize or used to craft political messages, paint their opponents in a negative light. Meanwhile these same lawmakers they continue to actively trade the market, they seem to have amazing luck, right . They always seem to be getting out of things like Silicon Valley right before it implodes. That is where the disgust comes in. 49 of americans now call themselves independence. That is the same amount of selfdescribed republicans and democrats combined. People are giving up on the establishment. As you see the red, a lot of folks are giving up on the stock market. I want to bring in Laffer Tengler ceo, nancy tengler. Nancy yesterday wassing it, there were headlines after thes. During the session, s p traded second smallest range of the year, the vix, fear index was under 16 most of the day but this was one tell. The bond market, the bond market was a intriguing tell to me because it had a major, major spike yesterday. The 10year yield, in fact this is the biggest spike you go back to september 26 of last year. What do you think the bond market knew that maybe were learning today . Yeah, charles, youre absolutely right, the bond market is the smartest market, i say that as an equity investor. I think the bond market anticipates that things are going to get more difficult if the fed doesnt come to the table. I am gobsmacked by how just universally incompetent this Regulatory Environment or this group is. The report that michael barr produced that said you know, that the problems were really trump changes to the Regulatory Regime that then caused regulators to take a lighter touch, i dont even know what that means. Charles its copout, that is what it means. Exactly. Were not responsible around we need more regulations that we wont be able to implement. I sat on a Community Bank board. The regulators could be friendly and not cozy. What you had in San Francisco a fed way too cozy with the very bank that they should been regulating. So i dont know if i speak for the market but i think that you nailed it. There is just a tremendous lack of confidence and trust in the people that are supposed to be looking out for our backs. Charles sew you brought up the banks. I want to bring up the kbe, one of the bank indices out there. So were down 5 today. Now yesterday it felt like maybe okay, First Republic, it was calm. Maybe there is not, maybe it is all over. Today anything but. Whats going on here . Why are these bank all of sudden starting to get hammered today . Well i think part of it is there is anticipation there will be more regulation. Then in addition that there really is a concern over commercial real estate and the fact that these banks are exposed. If we get a recession then their core customers, one of my favorites that weve not been adding to the group, i thought it was really reckless when a lot of people said they were jumping in and adding so quickly, one of my favorites, not Regional Bank, pnc, ceo calls it. Were not even a super evennal. They have 90 of their deposit base is insured. They have small consumers that will be the very people that will get hit in a recession. Charles right. I think everybody is just jumping to the sidelines, saying i will let this settle and they should because the regulators dont have a handle on it. Charles i really think it will be a disasterous mistake if they layer on the same rules for tiny Regional Banks they have for the giant banks, who by the way dont have to abide by them anyway. Jpmorgan shouldnt legally take over anyone but if anything is wrong, jamie dimon gets first pick. Yeah. Charles i cant let you go without asking about tomorrow. Everything is about the fomc. What do you anticipate in terms of rate decision, how will the market react . I think well get another 25 basis points, charles. I didnt they we should get the last 25. We know trailing three month annualized cpi is around 3 which is great and we just havent seen all the effects come in of housing and the lagging indicators but i think well get a 25 basispoint hike. Well get a disasterous press conference. That is the only place where this fed chairman has been consistent. He started talking, the market rallies. He keeps talking, it sells off. We warned may would be volatile. Use it as opportunity to get exposed to great names. One of the big surprises that companies, 60 of the companies that reported already have, are raising guidance. That is unprecedented. Margins are holding up. Companies i think are doing a good job. It is regulators and washington, d. C. Crowd that is really letting down america frankly. Charles i agree and i think that whole earnings recession thing to your point, were starting to turn out of it. If youre going to have the ugly market, great to have it during earning season. You know what names you want to own. Nancy, thank you so much. Appreciate it. Thank you. Charles lets stick with this whole theory the theme of fear, Artificial Intelligence that story taking a sinister turn. Late yesterday more concerns about a. I. As a threat to humanity. More evidence that it will be a absolute wrecking ball for businesses. Take a look at this. This is one day chart, this is just today. This is the plunge. It is where, lets call it 50 . One day one day. This is after the close they reported that they lost business to chatgpt. I want to bring in money map president shah gilani. This is a brand new wrinkle for investors. How to know how much risk a company in your portfolio who has a. I. You have to go company by company by company. This is a challenge . Only way to figure it out by using a. I. Charles [laughter] so many stocks out there. Some companies out there going to be impacted by, economy get impacted houma kind is impacted by a. I. It already started. As far as picking winners were a long way figuring out who the winners will be. There are a lot of false companies here not deeply into a. I. , now changing their names a. I. I dont know how many times a. I. Is mentioned in earnings reports so far but it is considerable. I will say there is a lot of ironing out before figure out who winners in the a. I. Space. Charles like old dotcom. Slap dotcom, worst businesses sure privated a little bit. Chegg, that is proof, golly rapid changes are going there. Same thing happened with ibm they will stop looking for 7800 jobs. They had postings, you know what . A. I. Can do these. This is a lot of jobs n a way i guess that is a positive gamechanger with respect to the income statement. Well were going to see more of that, we know that were already seeing it in the robotics field. There are a lots positions manuel labor jobs, advanced mechanical positions. Workers are being replaced by robots. With the advent of a. I. , the expansion of a. I. , those robots will become more important and more ubiquitous, probably good for profit margins, good for a lot of corporate america, bad for the rest of the folks who need jobs. Probably bad for the economy t may help with inflation down the road but there are going to be so many people unemployed, the jobs will evaporate. Im worried about that. Charles you really, really have to be worried about it. One thing you kept telling us, youve been spot on about this, resistance levels for the s p, for the nasdaq weve been coming up hitting them, coming up hitting them, coming up hitting them. To me after a while you become vulnerable. You hit them enough we start to pull back. Is that what were saying here, a major sort of pullback to regroup . Once again were trading in pretty much a sideways box. We get up to the top of the box the expectation is well bake out. We see that the expectation manifested in how many calls are being lots of call options are being bought closer we get to the resistance levels. Nothing happens. We dont break out. Guess what . We start to come down a little bit. The calls get sold. Market comes down, all of sudden we see put buying. I dont think this range is going to continue for that much longer something has to give one way or the other. Ive been saying 5050 chance of a melt up or meltdown. Charles melt one way or the other. Shah, thank you very much, my friend. I want to bring in evans may wealth managing partner, elizabeth may. Elizabeth, let me bring in the sort of what were talking about this sort of rangebound activity. Something interesting here this morning this is today, ton of put buying all in that 4,000 area, which sort of suggestions, okay, many people believe weve hit the 42 number. Were going to pull back again. Is that what youre seeing as well . Good afternoon, charles. I think if you look at the put call ratio overall on the s p 500 were at 1. 29 which actually is historically pretty low. So you hook at that and you also look at the vix ending april, in the 15s which would indicate some complacency. I think that if you look, a lot of the shortterm indicators, the technical indicators of the market are very bearish. So i think from our standpoint we expect shortterm volatility. I think you could see the market move lower before it moves higher. There is a lot of bullish long term indicators. Charles lets talk about that for a minute. Coming into the year, among professionals, right . Almost all my guests, all the trends on wall seat, look at bank of America Survey of money managers, everyone saying forget about u. S. Stocks. You know, go long outside of this country. Although u. S. Particularly nasdaq has fared very well. I think you like outside of u. S. As well, right . Yes. I think that overall you need to look at the company though as opposed to looking at a region or a size and style. You really need to look at fundamentals of that individual company. Charles what about the fed tomorrow, elizabeth . How are you modeling this . What is the fed going to do . First of all is there such a thing as a dovish hike . If so, what do you expect the market as reaction would be . Like your prior guest i think we expect 25 basis points i which is what the market expects. What well be interested in seeing tomorrow what is the commentary. If commentary is more dovish, you could see market break to the upside. You have Global Fund Managers across the board have 5 1 2 of aum in cash. So there is a tremendous amount of cash on the sidelines. Portfolios are overweight bonds to equities. So all of those contrarian indicators are good longterm for the s p 500. If you see some dovish commentary, you will see a fear of missing out, a move to put more money into equities. Charles ton of assets under management, ton of cash under management. What is the magic word though . Does powell give us the winkwink . What does he say all of sudden the market takes off, all of sudden, the train is leaving the station . Well i hopefully he doesnt talk for too long. Give us some indication you know, were close to the terminal rate and theyre going to pause. I think, if there is a chance we dont get 25 basis points that would really take off but i think you know somewhat more of the same. Were really in a mixed bag. Were seeing Economic Data that shows the economy slowing. Core capital goods shows businesses are spending less in the face of economic uncertainty. Charles right. Yet earnings have been good. 80 of companies that reported have beat to the tune of 6. 9 . I agree were in somewhat of a sideways trading range until we get past that. Charles i have to go, youre staying invested in this market, are you . Youre knot trying to move back and forth, are you . Absolutely. You need to stay balanced and now is not the time to make drastic shifts to Asset Allocation or positioning. Great stuff, elizabeth. Thank you very much. Thank you. Charles folks coming up the beginning of the wrath of Artificial Intelligence as the godfather of a. I. Leaves google and well he is warning the world. Weve got reed black man who actually wrote the book, ethical machines, he will break down just what the threat can be at 2 30. First, secretary janet yellen sounding the alarm on the debt limit. She actually moved the goalpost. Tough tavi costa tells us how much pressure that puts on todays session and more next. Whats the next chapter . Thats the real question. With fidelity income planning, a dedicated advisor can help you grow and protect your wealth, even when youre not working. Theyll look at your full financial picture and help you create a flexible strategy designed to balance Growth Potential and guaranteed income. So you can stop worrying about the future and enjoy the life youve created. Thats the planning effect. From fidelity. This isnt just freight. These arent just shipments. Theyre promises. Promises of all shapes and sizes. Each, with a time and a place theyve been promised to be. A promise is everything to old dominion, because it means everything to you. Starting a new chapter can be the most thrilling thing in the world. Theres an abundance of reasons to get started. How far we take an idea is a question of willpower. Because progress. Is a matter of character. Charles you saw this late yesterday, janet yellen moved the debt ceiling goalpost, right . Now it is presummer, thats the deadline before everyone thought late summer, maybe september. This move did give President Biden cover to call a meeting of leaders of both parties. The problem, it is not until next week. Is this an emergency or what . I want to bring in Crest CapitalPortfolio Manager tavi costa. So, first of all, so janet yellen says that were risking a catastrophic default at the start of june. This does change things, just how much do you think this is playing on todays session in this market and what are the new risks . Well im not sure it is really today, charles, and thanks for having me again. I think that the real problem is not so of what we had in 2011 which was a default risk problem. I think it is more related how well the fed or i should say the markets absorb a trillion dollars or so of issuance of treasurys after the agreement or extension of the debt limit happens . So i think when you, when you think about the 60 40 portfolios, other assets may get impacted by rising Interest Rates, it is a real impact. Something we didnt even learn in textbooks in the business schools. We learned about the Interest Rate risk, inflation risk, or even the default risk, what about supply, large increase of supply that can have an impact on the decline of treasurys and i think that is something the markets are not necessary hi looking ahead and i think its very concerning. Charles so lets talk about something that is obviously concerning the market today and thats the Bank Failures, right . And whats intriguing about this, if you look at back in the Global Financial crisis, there were a ton of Bank Failures, right . One year about 150. This is hundreds and hundreds of them. We have only four but the total, the value of those total assets already outweigh the Global Financial crisis. So how ominous is this . Regional banks have been halted for trading today. Theyre getting crushed. Many are down almost double digits. Whats going on . Its similar and different in a way. Clearly if you look at that chart, over 150 institutions failed on the banking side back in those days although, over about 10 of those actually got into the headlines of most financial media. 150 is a very hearing amount. Wee had four so far as you mentioned, and the amount of assets they hold is larger than what we saw during 08 and 09 during the banking crisis. The big issue here is everyone is asking themselves systemic problem, rick of this happening again today, you should look at gold prices. I think gold prices are sniffing around the fed will have to inject liquidity in the market in order to avoid or sustain the Financial Stability of the system and that is a big question. It is prudent for investors for my opinion hold some level of tangible assets in this environment. I think gold will become more and more the defensive asset for most institutions. Charles less than a minute to go, speaking of the federal reserve, so tomorrow, conventional wisdom, 25 basis points. A wink and nod suggest it is dovish hike. Big debate, needle moved yesterday. Street saw rate cuts coming in november. Now they see them coming in july. When do you think the fed may have to pivot particularly after the things you just told us . Sort of agnostic in terms of when the fed will actually pivot i have a view the fed will have t