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- [00:00]
A
What's up, guys? On this episode of Full Signal, I sit down with J.C. perez. He is the founder of Trend Lab. We go through a bunch of charts. He breaks down what small caps are doing, what tech is doing, emerging markets. This is a fantastic episode on how to organize your portfolio, how to think about markets for the year ahead. I think you're going to love it. JC let's get right into charts. That's what you do. That's what everyone's here for. This first chart, small cap value and small cap growth. Growth. Can you walk us through what you're looking at?
- [00:30]
B
Yeah, listen, you know there's a, A, a rotation that happens underneath the surface. And for a long time, a long time, multiple decades, growth stocks were a massive outperformer. For a long time, overvalue stocks. And that's in small caps, that's in large caps. The growth, the high growth names have been the leader for a long time. And some people think that it's always going to be that way. And that's not necessarily the case. There are times when value outperforms and we've seen that. And what's interesting is that a funny thing happened in, during COVID During COVID you saw a bounce back in value relative to growth. Right? But what ended up happening is that growth continued to outperform value at the large cap level over the last five years. But at the small cap level, that changed after Covid. And we have seen a series of higher lows in value relative to growth in, in small caps already over the last half decade. And now you're seeing that at the large cap level where large caps continue to decline relative to value. So we're hitting new six, nine month lows in growth stocks relative to value. You've seen a big rollover there in that leadership. And it doesn't necessarily mean that it's good or bad. It's going to be good and bad for different people's portfolio. It's not so much good or bad as it is different. And the way that the positioning is and the way that it's been is that American investors, they don't own value, they own growth. Right? They own big American tech stocks. And what to make matters worse, foreign investors, international investors have the most amount of exposure to American growth stocks that they've ever had, ever. And the least amount of exposure to their own stocks that they've ever had. So that rubber band is incredibly stretched. So I don't think this story's over. I think rotation out of growth and into Value is, is here to stay and it's going to continue.
- [02:24]
A
Do you think that people are not paying attention enough to small caps in general?
- [02:29]
B
No question. I mean, when you look at speculators in the futures market, they had on their largest net short positions in small caps ever last summer and the largest net long positions in the NASDAQ 100 ever. Right? So these are the asset managers. These are historically the worst investors, particularly at an extreme and, and ever is certainly a very high extreme. So we have seen that unwind since last summer. Investors just don't own energy. The S&P 500 is less than 3% energy. The NASDAQ is 0% energy. Right. The Dow is 3% energy. American investors just don't own energy. You could say the same thing with materials. You can look at industrials. Americans just don't own those types of stocks. They own mega cap growth, they own massive tech companies, massive communications companies, these huge companies that. And by the way, that's $20 trillion in assets in the MAG7 alone. And so much exposure there and a lack of exposure elsewhere. And because that lack of exposure, these are small cap stocks, these are energy stocks, these are natural resources, they're a lot smaller, they're easier to move. So they really, really move. So there's a lot of money to be made there, in my opinion.
- [03:40]
A
So something I've seen you write about recently is that people look at the Mag 7 and because the Mag 7 has been underperforming recently, they think the market's underperforming. But what you've pointed out is that really all these different corners of the market that maybe don't make headlines, everything's going up. Is that broadening you expect to continue? Like, what do you make of that?
- [04:00]
B
Yeah, I mean, listen, you know, we're recording this podcast so you know, we'll see what happens over the next couple of days before this drop. But until now we have seen massive gains from practically everywhere. But mega cap tech and software stocks, right? Software stocks getting absolutely slaughtered. And cryptocurrency is essentially trade with software. People are like, oh, that's this inflation hedge. And it's like this new thing and new currency maybe, but at the end of the day it trades with software. And that has been our thesis and all the market has done in recent months is confirmed that that is exactly the case. Right. So it was just based on where the math was. And then when you look at what's happened since then, that's what the way the math still is. So bitcoin and cryptocurrencies could eventually become something, maybe. But until today, they've just been software stocks, Right? So if software stocks are going to get hit, cryptocurrencies will continue to get hit. If you think that software stocks are going to do well, cryptocurrencies are probably going to bounce with them and vice versa. So that's really how I'm. How I'm thinking about things from an asset class perspective.
- [05:02]
A
I have not seen anyone really talk about that tie between software and crypto prices. That is very interesting. Do you think that kind of puts to bed the store of value question for something like Bitcoin?
- [05:16]
B
You know, store of value? Like, was gold a store of value? You know, something that doubles in a few months, or silver a store of value? I mean, you know, so everything's relative, right? With store of value, yes. Technically it is a vehicle in which one can store value. The volatility of that value is going to change every day, you know, so that might, you know, so it depends on what your definition of a store of value is. But at the end of the day, when you look at, when you look at, you know, when I first started trading Bitcoin, 2013, I was given Bitcoin. That turned into a whole bunch of money that I forgot I even had. Just to put things in perspective, how dumb and little. How dumb I am and little I know. So I was given the bitcoin and whatever. So I'm like, oh, yeah, cryptocurrency, so it must be a currency, right? So starting in like 2014, 20. Yeah, 2014, 2013, I included as part of my chart work, you know, with my $600 target in Bitcoin and my $1,000 target in Bitcoin. I still have those old charts, by the way, because I thought it was a cryptocurrencies because what the do I know? So I just included it with my dollar, euro, yen, bitcoin, right? And then eventually, like Ethereum, and then ultimately, like, it started becoming its own thing. There were other names. And I realized it wasn't a currency at all. Right? It's more of its own thing. And so I thought. And then over time, it's like, oh, these aren't cryptocurrencies, these aren't currencies. These are just more tech stocks, right? These are more growth stocks. And then over time it's like, yes, they're tech stocks, but they're not semis, they're not hardware, they're software stocks. These are software stocks, right? So like over time the as information came in and we started to see how these things are behaving. You know, whether you think there's something or whether you know, you believe one day they might be something. Maybe. But they trade like software stocks. So we treat them as software stocks.
- [06:59]
A
That is such a good way to think about it. I really like that.
- [07:02]
B
I wish that wasn't the case by the way. I wish they were something else, but they're not.
- [07:05]
A
Well, I mean we'll see how this year goes with the, this software apocalypse. I mean it's been crazy. So we have the second chart here. You're showing the Russell 2000 and the Small Cap Financials PSCF. What are you looking at here?
- [07:20]
B
So small caps are making new all time highs. The Russell 2000. That's something that you know hasn't happened in a while. Small caps making new all time high Small caps were really the laggard for a long time and people forgot about them and started, you know, wanting to short them to a, a great degree. And you know, there were just other places to be than small caps. Right. The old, well you know, they're always losing their best players is really the saying. Right. Because technically they do, you know, the best players become mid caps and large caps and leave the small cap indexes. So there is something to be said for that. Fine. What's in the Russell 2000? What's in small caps? You got a lot of banks, you got a lot of biotechs, right? You got a lot of banks, but a lot of banks. So when I see the small cap financials index coming in with like an eight year base, a huge base, I think about the implications of that. I think about the Russell 2000 making new all time highs and wondering is this sustainable? Can we have a massive leg higher in the Russell 2000? Maybe. But what's going to drive it? So then when you do a sum of the parts analysis and you look to see what's in those small cap indexes, you're going to find a lot of banks. So let's look at the bank index. How do they look? You got this huge base in the small cap financials index and if that breaks out of an eight year base, well then there you go, there's your tailwind, there's your catalyst for the Russell 2000. Right. Because biotechs have already been working, right? Biotechs were one of the best winners last year. Right. I mean you look at my portfolio, you think I'm some kind of scientist or something like I Wear a lab coat in my basement or something. I don't know anything about these things. They were just the best stocks. So if you want to own the best stocks, you got to buy the best stocks. Biotechs were that if these regional banks, if that financial Small cap financials index, which is basically mostly regional banks, if that breaks out, there's your tailwind for the Russell 2000.
- [09:00]
A
Okay, I hear what you're saying. What do you make when people say, look, when small caps are rallying? These are a bunch of unprofitable companies, they have no business going up. But it's a sign of maybe red flags somewhere. What do you make of that?
- [09:15]
B
There's no evidence of that at all historically. Right. So you might think that small cap stocks going up, not you specifically, but somebody out there might think that small cap stock going up is somehow a bad thing. There's no evidence of that at all. In fact, go study bull markets. Small caps do well, they've just historically in recent past underperformed the large caps. Sure, but a sign of frothiness because small caps are going up. Not really number one. Number two, small caps have been going up, just not the Russell 2000. Small cap industrials have been ripping for years, right? Small cap industrials have been making new all time highs for years and so has the rest of the market. Small cap technology has been working out great. Now you're seeing new highs in small cap healthcare, which is biotechs, in small cap energies coming around. Small cap financials might start to work now, right? That would be something new. But industrials technology, those have been working small cap materials making new highs now as well. Small cap consumer discretionary doesn't look terrible. Hasn't broken out of this base yet, but doesn't look terrible. So there's still, there's still room where it's not like oh, all these crappy small caps are making new highs. Like there's stuff that haven't been working that are still important. Discretionaries, financials, healthcare is just getting going.
- [10:26]
A
Okay, so don't fade small caps. Got it?
- [10:30]
B
Not if financials are breaking out of that base.
- [10:32]
A
Okay, fair enough. All right, we got this third chart here. Consumer discretionaries and consumer staples. What is this chart saying to you?
- [10:41]
B
You know, when things are good, market's healthy, you got your mutual fund managers, they're long only managers. They can't short stocks, they can't raise cash, they can't, they got to be long stocks. So when things are good, they're out overweighting consumer discretionary Right. Because consumer discretionary is going to do well in a healthy environment. They're underweighting consumer staples because if things are good, you're buying banks and tack and industrials. You're not buying paper towels and toothpaste and condoms and booze and. Right. Like you don't need consumer staples, you're buying the more aggressive consumer discretionary. Home construction, you know, automobiles. Retailers like where we spend our discretionary income. So when you put together a ratio between consumer discretionary and consumer staples, you're able to see that risk on, risk off. And it doesn't happen overnight. It's like a cruise ship kind of turning. It's a slow process. So when you've seen consumer discretionaries rolling over relative to consumer staples, that's defensive rotation. That's something that we haven't seen in a while, that we're seeing now. Right. At a critical, at a critical juncture to the market. So consumer staples doing well on an absolute basis. There's nothing wrong with that. There's stocks in a bull market, Stocks should be going up. But when consumer staples are outperforming the market, particularly consumer discretionary, go back 30 years, every single time the market tops, you're going to see that rolling over.
- [12:06]
A
Okay, so is there something to be
- [12:07]
B
worried about here if consume. If consumer staples continue to outperform the rest of the market?
- [12:13]
A
Worried?
- [12:14]
B
Yeah. If you're overly long, the stocks that are not going up and the stocks that are going down, yeah, you should probably worry. But you know, you should have a plan in place, Right. If you don't know what to do with your portfolio, it's because you didn't have a plan. That's your first problem. Right. Moving forward, have a plan. Right. So if you're ever worried about anything, it's because you don't have a plan. There's no reason to worry because you just stick to the plan. You know, Right now, bigger picture as far as the market is concerned, like I said, it's not necessarily good or bad, it's just different. So if energy stocks and consumer staples are the ones ripping higher, is that good or bad? It depends. Do you own, Are you loaded up in software? Because that's probably not good for you, right? Do you own a ton of energy? Did you rotate into energy as energy has come in? Well, then that's great for you, right? So it's not so much good or bad as it is different. Not to mention that a lot of these countries around the world, almost all of them, none of them have Mega cap tech exposure, Right? They have a lot more exposure to the value. They have a lot more exposure to natural resources. Right? Which is why, despite a 17% gain for the S&P 500, last year, the US was one of the worst countries in the world.
- [13:22]
A
Wow.
- [13:22]
B
Right? US Massive underperformer.
- [13:25]
A
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- [14:46]
B
So listen, we're looking at, you know, I don't want to get too esoteric and philosophy and philosophical here for the podcast, but, you know, if you understand nature and you understand sort of the vibrations that create all of the things that are happening. Right. Again, I'm not going to get all scientific, but these extension levels really are being driven by the vibrations in the world, right? That's why when you, when you calculate these levels from high to low and you get you. You get projections in the market for the Overall S&P 500 and the major indexes, the market respects these levels again and again and again. We call them Fibonacci extension levels. And as somebody who looks at thousands of charts a week, I'm not going to waste my time, you know, looking at something. If the market hadn't proven time and time again that it matters, right? And these levels matter, particularly when they cluster together. So what we're looking at is a series of clusters. First of all, you have the 1 61.8% extension of the tariff tantrum last year. Right. That is the next extension right here under 7,000. The bear market in 2022, the 261.8% extension of that bear market is right here. And when you go all the way back to the great financial crisis from 07209, the 685.4% extension. Right. That next extension is right here. So you have a series of extensions clustering at the exact same level. And when you look back, historically, these extension levels are important. Sure. But when they cluster together, it just reiterates just how important these levels are. So what does that mean? That. Well, first of all, the market has already acknowledged that these levels matter because we got there in October and The S&P 500 has essentially gone sideways over the last three months. So the market has already acknowledged that these levels are important, which further reiterates that that to be the case. So, number one, there's trouble here at these levels. So if there's going to be a correction, this would be a logical place for that correction to happen. But the implications of exceeding that level get you north of 8,000. Right. So there's implications on both sides. Yes. There's a hurdle to climb if and when the S&P 500, and I wouldn't want to say if one day it will. I just don't know how long it's going to take when The S&P 500 breaks out above that 700 and sticks the landing. That's a quick 8180, 200 on the S and P pretty fast. So there are multiple implications. So these, this 7,000 level, it's not just a round number and a psychological level, like there is a lot going on here. So the ability to exceed that for the S&P 500, the implications there are going to be massive. It just might be coming from a lower level. Wow.
- [17:26]
A
Okay, so I have the charts right in front of me. We have nothing on the screens. You don't have the papers in front of you and you're saying these to the decimal point, which is unbelievable. So that's how I know you know your stuff. Can you explain a bit how you look at these charts and then you also tie in like the macro and the fundamentals, because I feel like, you know, talking to you, you have a bottoms up and a top down going at the same time. Like, how are you approaching these?
- [17:53]
B
Sure. So fundamentals are not you know, fundamentals, maybe like the factors like when we talk about like value or growth or stuff like that. You know, when we talk about. Maybe like, I guess dividends aren't really fundamentals. Yeah. You know, you know, we'll look at like unprofitable tech indexes and stuff like that to get a gauge of that. But that's really the extent of the fundamental analysis that I do. It's really price and behavior oriented. And you know, we look at the behavior of asset, right? Because think about it like this. There's a lot about the market that we don't know, particularly about the future. Right. So I like to focus on the things that we do know. What do we know? Very few things. But we do know that asset prices trend. We know that asset prices are not random. Like these are not random up, random down. Asset prices trend. We know there's common sense. Just look at the charts or if you want to read the white papers from MIT and Harvard and all that, you knock yourself out. Asset prices trend. We know, we also know that volatility mean reverts, right? We know that from low volatility comes high volatility and high volatility comes low volatility. Volatility does not trend. We know that too. What we also know is that the humans are crazy, right? It's not that the people, I talk to people all the time that I go, J.C. the market's crazy. It's like, no, no, no, the humans are the crazy ones. The market is just fine. It's the exploitation of irrational human decision making. When stress levels are elevated, that's what you're seeing that you think is crazy. Not the market. The market's just doing its job, right? So as humans, we have a lot of flaws where we make irrational decisions when our stress levels are elevated and when our stress levels elevated this day and age, not like our ancestors, very different. This case when money's involved. So the market really, really exploit, you know, you know, just highlights the lack of rational decision making by humans. So we know all those things to be true. So, so we want to find out where the humans are, have, are most vulnerable, where they have the most exposure, right? Where they're making the most irrational of decisions, right? That's combining all of those things together is kind of what you see here, right? So we follow trends, right? Macro trends. These are big themes. Looking out 20, 30, 40 years, right? And then we drill down. So it's multiple timeframes. So it's starting with long term charts, long term trends and then drilling it down to see if the short term trends are in that direction or their counter. Right.
- [20:27]
A
That's again, fantastic way to think about it. I think when you take a problem and see if it's whole, it holds true in a near term, medium term, long term only, then you know, it's like the thing or the trend in markets, but also in any situation. All right, let's go to this fifth chart here. Emerging markets are at all time highs. Why is this something you're watching?
- [20:49]
B
Because when was the last time you could say emerging markets and all time highs in the same sentence?
- [20:55]
A
True.
- [20:55]
B
Listen, I talk a lot, right? I talk to, I talk on video, I did the podcasts, I talked to trader friends all day long. Like I'm talking constantly. So I say a lot of things. So when I catch myself saying something that I haven't said in a long time or ever, like emerging markets and all time highs in the same sentence, it's like, wow, haven't said that in a minute. You know, Dow Jones Transportation average, all time highs. Haven't said that in a minute, right? So when you catch yourself saying certain things that you never say, especially if you talk as much as me, it stands out. Emerging markets are finally able to break out above those highs. So like, you know, when it comes down to like, hey, how sustainable is the overall market if mega cap tech is completely falling apart and software's crashing and oh my God, and the world's coming to an end and the thing and the Fed, and if emerging markets are above all of those former highs from the last 20 years, there's money to be made from the long side. Whether it's in China or in Latin America or in Africa or some of these European emerging markets, there's money to be made there. So I think the bear case for stocks as an asset class starts with emerging markets. If you think everything's about to fall apart and this whole house of cards and one of those, that emerging markets chart needs to fail. But if that sticks and emerging markets are making all time highs, the world is not coming to an end.
- [22:21]
A
Do you think it's fair to say that emerging markets will have to start going lower before the S and P starts going lower?
- [22:27]
B
No, not necessarily. I think at a certain point, if things are getting bad in the S and P and at a certain point it needs to spill into other assets. Just the way money works, right? When you got $20 trillion in the MAG7 getting slaughtered, some of these other places are going to be used as a source of funds. Ultimately that will, that will come to be true as of this recording. That hasn't, that hasn't happened yet. Mathematically there's a point where that has to happen. So it really just comes down to does the, this technology and software stabilize before they start hitting the other countries and some of the other outperformers? What comes first? But if emerging markets sticks the landing, that's one month of a new all time high. One month? Hey, better than zero, right? But how about two or three? We'll see what happens.
- [23:14]
A
Okay. Yeah, I can't say that a lot of the people I speak with are watching emerging markets that closely. They might glimpse at it just to see. Maybe they look at Latam and see what's going on there. But everyone I speak with just focus on AI trade in the us don't worry about it.
- [23:32]
B
In those countries that are dominating US stocks, they're focused on AI too. They're not buying those stocks. They have the least amount of exposure to their own stocks, foreign investors to their own stocks than ever before. So not only do we not care as Americans, I'm not saying by you and me, but as Americans, Americans don't care about these types of stocks, neither do the foreign investors.
- [23:54]
A
Who's buying them?
- [23:56]
B
Nobody.
- [23:57]
A
But they're at all time highs, right?
- [24:00]
B
But think about it on a relative basis, right? So as money's coming out of these other areas, it only needs to go in a little bit. Remember, these emerging markets are tiny. Small caps are tiny. So it doesn't take much to move the needle versus a $5 trillion company. You know, these things are moving 200, $300 billion a day. Like if nothing so true.
- [24:21]
A
All right, let's get this six chart up here. Energy stocks and US treasury bonds, XLE over tlt. What's going on here?
- [24:29]
B
I think this might be the most important chart in the world.
- [24:32]
A
Tell me more.
- [24:33]
B
Well, energy, speaking of underperformance, hasn't done anything since the great financial crisis. When you look at large cap energy, when you go down the cap scale and you look at oil services, you look at explorers and producers, they look even worse, right? They're nowhere near the great financial crisis highs, right? So when I see the XLE energy, ExxonMobil making all time highs. Speaking of things we haven't been able to say in a while. Energy, all time highs. Haven't said that in a minute. So when I see that and then I see, well, if gold is ripping silver's ribbon, copper's ribbon, and now energy is gonna Go. You think interest rates are gonna go lower? Probably not. Right. And then, you know, the beauty of it is what's hilarious, right? And you know, when you've been in this business long enough, you start to laugh at these sorts of things because if not, you start crying, right? It's cry or laugh. So we gotta laugh about it. What's hilarious is that interest rates stopped going down as soon as the Federal Reserve started lowering interest rates. Right. Which is fascinating. So in the fourth quarter of 2024, the federal federal Reserve decides they're gonna start lowering interest rates. Well, that's when interest rates stop going down.
- [25:39]
A
Right.
- [25:39]
B
So 10 year, 30 year yield yields all over the world, straight up since the Fed started lowering interest rates. So now that energy is breaking out. So by the way, the bond market is very smart. So the bond market has been already pricing in for years now, A year and a half or so, or maybe not a year and a half, year and a quarter. These assets, these hard assets going up in price. Bond markets already been priced in this end, right. That yield curve is steepening like a mother, right. So when you see all of these things and now energy starting to get going, you think interest rates now are going to start going down now? So if interest rates. Right. So when, if interest rates are going up, which is what I think is going to continue to happen as all these hard assets keep going up and interest rates chase them. Well, what does that mean for bonds? It's lower. So when you look at a ratio of energy stocks and treasury bonds, that line is going up. It's making new all time highs. That's the trend. Energy up, bonds down real quick.
- [26:33]
A
We'll get right back to the interview. Just wanted to pop in and say if you like this content, I read a newsletter every single morning called Opening Bell Daily. I cover macro, the stock market, asset prices, why things are going up, why they're going down. And if you want to get that for free, you can sign up at the link in the description. Let's get back to the interview. Okay, can you explain a bit more? I hear what you're saying, but why not track those things separately? Like why would you. I've actually never seen this chart where you go energy over bonds. And I think it's really interesting and it makes sense what you're saying. Why not just look at energy on one chart and then just track the bond market? Why are you pairing them?
- [27:13]
B
Well, I'll tell you what, in mo, in almost every case where it's like, well, should we do it this way or this way? The answer is always. We do it both ways, right? So, yes, we of course track energy on their own. Of course we track Charger bonds on their own. Why do we compare it? Well, for a few decades, financial advisors and investors of all kinds convinced themselves that there was this thing called a 6040 portfolio where you put 60% in stocks, 40% in bonds, or vice versa. And hey, when stocks are up, bonds are up less, it's fine. When stocks are down, you get your bond, so balances it out great. What could go wrong? What could go wrong? Well, what could go wrong? We saw in 2022, both of them went down together. So the 6040 portfolio turned into 100, and your hundred was going straight down together. That was a regime, a regime change, right? So if you must have a 6040 portfolio, I think it would behoove investors to think about it. Like 6040 stocks, commodities. 6040 stocks, energy. Right. Bonds. In an environment where. In a much different environment. And you know, humans are tough, you know, you. It's tough. It's hard to teach an old dog new tricks, right? In some cases you got new dogs that just don't know any other tricks. And then you got old dogs that have learned, have been on this trick for forever and forgot the way the tricks used to work before because they don't remember the 70s, too many drugs or alcohol, who knows? But they don't remember the 60s and 70s. But if you go back and you study the 60s and 70s, where that 60 portfolio is not what it looked like in the 90s and 2000s, it's a much different story, you know, so when you think about these different regimes, and that's where, you know, the bigger picture macro perspective really helps is to understand the differences in these regimes. And I think that that energy treasury bonds ratio really tells the story about that regime change and where, you know, investors, you know, listen, I don't tell anybody what to do. I tell you what I'm doing. But, you know, I think that that particular chart could help a lot of investors think about it and conceptualize what's going on out there.
- [29:14]
A
Okay, I totally hear you. And I'm definitely going to start paying attention now to this ratio. When you think about, let's say, the last 11 months of the year we have coming up, we're just starting a new year and semis have done very well. Some other parts of the market are picking up. How do you see asset prices going for the next few months?
- [29:36]
B
Man, I think about this every day. Dispersion is what really stands out to me. I said it coming into this year in January, certainly you had a ton of dispersion. I mean, I think energy was up 14% in January with financials down 3%. So that's 1500 basis points of alpha there, you know. You know. Yeah. And even the guess and PS were up only a couple of percentage points, you know, so massive dispersion is likely here to stay. So I think that this year you're going to have winners, massive winners. You're going to have massive losers and some of them stuck in the middle. So keep that in mind. Also, this is a midterm election year, which historically is the worst of the four year cycle. Right. So if you're going to have a big correction, this would be a very logical place for that to happen in midterm election years. Doesn't mean it needs to play out that way. It's just the way, just the way that it is quite often actually, like quite often actually. You know what's really interesting for investors, you know, something important to think about is that the midterm year is the worst year. And depending on where you start calculating whether you start during the Great Depression or whether you start in 1950, pre election years are the best years, right? Or one of the best years, depending on how you calculate it. But let's call it the best year pre election years, which is year three, which would be next year the best year. This is the worst year. From the low this year, midterm election years on average to the high next year pre election years on average. The S&P 500 moves 50% higher. 50%. It doesn't mean that the S and P is going to go 50% higher from here. Could very well be from lower levels. Probably will be. Right? But that's a 50% move. That's a huge move. And that's just the average could be a lot more.
- [31:24]
A
Well, something I've seen when we had tariffs last year, stock market cratered, Everyone that sold, let's say the S&P 500 on that dip, they're down half or they've made half as much money as the people that just held their stocks. Which I think is interesting because most people were panic selling. All the headlines were as bearish as ever. They thought we'd get next Great Depression. But really if you just held on, you've doubled what the people that sold.
- [31:53]
B
Since when? Since when?
- [31:56]
A
The tariff sell off in April to now.
- [31:59]
B
And my mom was calling me, she's like, should I liquidate my 401k. I'm like, we gotta be buying stocks. Mom's scared. Mom never calls me to ask me about the market.
- [32:08]
A
That's, that's when you know, JC where can people find your work online?
- [32:13]
B
Trend labs.com very simple, you know, follow me on Twitter. Just put JC Perez on Twitter and you'll find me. If it's a bot asking you to click on things, it's probably not me. There's that too on the, you know, on the old Twitter X I believe the kids call it these days. And trend labs.com you could read my newsletter called Everybody's Wrong. And the reason that it's called that is because at everybody in the world is wrong about something at all points, right? So we're about finding where the most vulnerability is. Like where everybody has it wrong so we could take the other side and make money. Because that's what this is all about. You know, how do we make money from it in the market like the Trump and then the tariffs and then the Fed and then the inflation and the crypto and you got all these things. But how we make money from this, right? And that's what we talk about.
- [33:01]
A
Trend Labs, it's a very useful product in newsletter. I read it all the time. JC thank you so much for coming on the show.
- [33:09]
B
Happy to do it. Thank you, Phil.