Motley Fool Money: Episode Summary – "Dirty Words: Election, Tariffs, Spatchcock" (Released November 29, 2024)

Hosted by Dylan Lewis, Ricky Mulvey, and Mary Long

1. Introduction and Thanksgiving Theme (00:00 - 12:00)

As the annual Thanksgiving season approaches, Dylan Lewis sets the tone for the episode by blending gratitude with financial insights. The hosts introduce their special guest, Tom Turkey (Rick Engdahl), who plays a pivotal role behind the scenes, ensuring the show remains honest and insightful during the holiday period.

Dylan highlights the current investment landscape:

• Moderated Inflation: "Inflation has moderated," he notes, signaling a more stable economic environment.
• Federal Reserve Actions: "The Fed has begun cutting rates," indicating potential shifts in monetary policy.
• Political Certainty: "We know who the next president of the United States will be," providing clarity for investors.

2. Market Overview (12:00 - 07:50)

Jason Moser expresses optimism about the market's direction:

"The market does like certainty a lot" ([01:34]).

He discusses the potential impact of the new administration on economic policies and interest rates, emphasizing that while inflation has improved, the battle is not entirely won.

Ron Gross declares a "soft landing" for the economy:

"The S&P500 is up 26%. NASDAQ up 27%. Not too shabby." ([03:32])

He highlights the resurgence of small-cap stocks and a diversification away from large tech companies, citing the Russell 2000's recent performance:

"The Russell 2000 has been very strong even recently, the last several days." ([05:06])

Dylan points out the impressive two-year returns:

"The S&P 500 is up about 60% on a total return basis. NASDAQ up over 80%." ([05:34])

Despite the strong market performance, Jason cautions that not all consumers feel the same economic well-being, highlighting the disparity in stock ownership:

"The wealthiest 1% hold 50% of stocks... The bottom 50% of U.S. adults only hold 1% of stocks." ([05:34] - [07:12])

3. Serving Up Humble Pie: Investment Missteps (07:50 - 12:00)

Dylan invites Ron and Jason to share their investment missteps as a form of "humble pie."

Ron Gross discusses his challenges with Target:

"The shares got whacked down 20% in one day because it's really continuing to struggle to get its inventory problems fixed." ([08:09])

Despite the setbacks, Ron remains optimistic:

"At 14 times forward earnings with a 3.6% dividend yield, it's worth the risk, reward, trade-off there." ([08:09])

Jason Moser shares his disappointment with Outset Medical, highlighting poor management despite promising technology:

"It's been led somewhat poorly. Ultimately that is reflected in just an awful share performance for me." ([09:41])

Dylan humorously adds a personal touch by mentioning his hope for good football over disappointing playoff results.

4. Thankful for These Stocks: Gratitude in Investments (12:00 - 21:07)

The hosts transition to expressing gratitude for their successful investments.

Ron Gross lauds Costco, celebrating its exceptional long-term performance:

"Up 1,300% for me over the years. That's a lot of percent." ([12:00])

He shares a personal anecdote about enjoying a shopping trip, emphasizing Costco's strong business model and potential for international expansion.

Jason Moser highlights Axon Enterprise as a company he's thankful for:

"The stock is up better than 140% just this year alone. About 250% over the last three years." ([13:21])

Dylan echoes this sentiment, mentioning Axon as his largest holding and best performer, underscoring the importance of a long-term investment horizon.

5. Steering Clear: Topics to Avoid at the Thanksgiving Table (21:07 - 32:28)

In the segment “Not at the Table,” the hosts discuss topics they prefer to avoid during holiday gatherings.

Jason Moser wishes to avoid discussions about elections:

"Nothing against elections... but we've been talking about it for a year. Let's move forward." ([15:57])

Ron Gross prefers to skip conversations about tariffs, citing their complexity:

"No one truly understands how they work... So I think we skip it this year." ([16:47])

Dylan interjects to briefly touch upon tariffs' impact on the market, prompting Ron to acknowledge their potential significance:

"Tariffs are obviously creating some concerns for companies and we're seeing some headlines that are affecting the market short term." ([17:22])

6. Listener Questions: Navigating Financial Careers and Portfolio Management (32:28 - 35:10)

The show addresses listener inquiries, starting with Alberto's question about financial certifications.

Ron Gross advises on relevant certifications:

"The Series 65 is what lots of financial planners have... CFP is a great idea. Chartered Financial Analysts are great if you're going into portfolio management." ([21:59])

Jason Moser shares his non-traditional path into finance, emphasizing passion and community:

"I started out as a member... and made some connections within the company along the way." ([23:17])

Spencer from Los Angeles asks about portfolio allocation:

"Are you looking at one brokerage account individually or a collection of brokerage accounts?" ([25:02])

Jason Moser clarifies his approach by differentiating between assets and investments:

"I consider all of my portfolios... I do not consider real estate in that picture because our real estate in this case... it's where we live now." ([26:09])

Ron Gross concurs, emphasizing the importance of consolidating accounts for accurate allocation:

"I consolidate all of my various accounts to one so I can look at my Costco position across accounts and see what allocation it is in total." ([27:45])

7. Holiday Shopping Insights (35:10 - 37:36)

Ed inquires about the significance of holiday earnings for retailers:

"Do you weigh the results that retailers put up in the holidays more when you're looking at a retailer and the management team's track record?" ([28:49])

Ron Gross affirms the importance of the holiday season:

"The holiday season is where many retailers make the most of their money in any given year." ([29:27])

Jason Moser discusses the extended duration of Black Friday sales and its impact on retailers' margins:

"It's hard to know what is noise there and what becomes more meaningful." ([30:10])

Ron adds that holiday earnings will be pivotal in assessing retailers' performance:

"Holiday earnings in the aggregate are not expected to be very strong this season for a lot of reasons." ([31:56])

8. Holiday Culinary Tips: Spatchcocking the Turkey (37:36 - 35:10)

A fun listener question from Neil about spatchcocking the turkey:

"Any recommended videos or info on sites to do this properly? Planning on convection roasting, not grilling." ([32:28])

Jason Moser enthusiastically explains his method:

"You're essentially cutting out the backbone, flattening out the bird... It cooks more evenly and makes for a better dining experience." ([32:59])

Ron Gross shares his own Thanksgiving dish:

"I am in charge of the sweet potato pie. Melted marshmallows on top." ([33:58])

Dylan appreciates the culinary contributions and engages with the hosts' personal holiday plans.

9. Movie Recommendations for the Holidays (35:10 - 37:36)

Dylan shifts the conversation to holiday movie releases:

"Disney's Moana. Two projects to beat that total by itself." ([35:10])

Jason Moser expresses reservations about the upcoming movies, highlighting personal preferences:

"I just don't understand how the movie can top that [Wicked]." ([36:24])

Ron Gross humorously admits his daughter's enthusiasm for "Wicked" songs:

"My daughter... went and saw it two days ago and she will not stop singing the songs." ([37:03])

10. Radar Stocks: Garrett Motion and Samsara (37:36 - End)

The hosts conclude with the Radar Stocks segment, spotlighting potential investment opportunities.

Ron Gross introduces Garrett Motion GTX, detailing its background and current status:

"They supply turbochargers and electric vehicle powertrains for passenger cars, small trucks... trades at only five times free cash flow." ([37:36])

Jason Moser highlights Samsara as his top pick:

"Samsara ticker is IoT... it's rewarded our members up since then, 240%." ([38:35])

Ron emphasizes Samsara's strong performance and future earnings expectations:

"Most recent quarter here, revenue growth of 37% from a year ago... Another earnings release coming out on December 5th." ([38:27] - [39:24])

Conclusion

Dylan wraps up the episode by thanking the listeners and encouraging them to engage with the show’s content responsibly:

"Don't buy or sell anything based solely on what you hear." ([35:27])

With insightful discussions ranging from market trends and investment strategies to holiday preparations and personal anecdotes, this episode of Motley Fool Money offers a comprehensive blend of financial wisdom and seasonal warmth, making it a valuable listen for both seasoned investors and newcomers alike.