Market has plenty of momentum as long as 10-year stays below 5%, says MAI's Chris Grisanti

Is this the beginning of the other kind of problem? You know, you say wish we got to pick our problems. Certainly no one wants a deficit spiral and a debt deficit situation to be one of them. And I think that's why everyone watches these auctions with such baited breath to hope like, and people have already joked is the next phase of this cycle that everyone's happier to buy corporate credit and Apple and all this other debt than U.S. government debt. Unfortunately, U.S. government debt is what everything else is priced off of. Anyway. What are your thoughts? So first of all, there's nobody better than Rick Centelli to get to the heart of the auction instantly after it happens. It's just always so impressive. But the second thing is, look, you're absolutely right. It's one day. I don't think we're going to get into that deficit spiral just yet. I've been getting asked that question for more than 10 years now. So I don't see a reason for it now. But what I do see is momentum behind a market. I see a market that wants to go up and as long as we keep that 10 year below, say 5%, I, I think that there's a, a pretty, there's a, an open line for the stock market. That was the same number that Jason Trenard of Stratega said. Again, it might be more symbolic or, or psychological than anything, but we know that that does have an impact and it's a nice and round. It is a nice and round. So where are you looking in this market? Let's remind everybody you had the famous Verizon Tesla call that has been still going strong. I mean, I don't know what the spread is at this point. One of the best pair trades bullish Verizon bearish on Tesla at that point the market where are you looking now? Well, not unlike that. I do think that obviously the mag 7 is sucking capital towards it and clearly they're working right now. But the end result of that is capital has been sucked away from things that may be good investments. And I'll give you 2 that are non tech that I really like for kind of long term investments. One is lithium really like lithium? I think the the problem with US investors is that they're US centric. They don't appreciate EVs are not selling well in the US right now, but they're selling like hot cakes in both China and in Europe. And this is going to be a worldwide phenomenon. So the only problem with lithium is the, the old kind of, you know, famous air like debate of the 70s, Julie, where, where the whole idea of commodities going up in price seems to be, you know, I, I know we're in an upswing right now. I know three of the last four years of a positive, but broadly speaking, that higher price seems to bring on more supply and you just can't do that that well for the long run. Well, but, but that's not been true for lithium over the last two years for sure. So I see this akin more to buying oil in 2020 when it, you know, crashed and it actually went negative for a bit. So lithium prices have been down now for the better part of two years. The stocks are down 60 or 70%. So I'm not saying that we certainly won't have those cyclical moves, but right now we're at the bottom of this cycle. Now, I wouldn't own a lithium stock that does well for 10 years. You know, this is one you rent and not own. Yeah, but you could own this for a while because things are pretty bad and expectations are incredibly low. And they were showing Albemarle one of the most obvious plays. So you like lithium? There's the commodity. What else? You know, I like Hershey, great brand. I do like Hershey and I like it, of course, because as you've reported, many times the price of cocoa has gone through the roof and that's really hurt the price of Hershey stock. In fact, not only is it hurted, but it's masked really good operational improvement at Hershey. So earnings have stayed kind of flat even in the face of cocoa prices going up to 100%. Some might say that's because they don't use any cocoa. Now Kelly, Now Kelly, that's Doctor. In fact, it's their largest cost of goods. Is that OK? It is indeed and and they've raised prices, but as as you probably know, Coco prices have declined by about 30% over the last month. Hershey's stock has gone up a little bit, but not a lot. So looking forward, especially if you think there is a slowdown coming at some point. This is a staple stock that hasn't participated in the market. So quick final word on this. What inning, I guess so to speak of the whole expansion. Do you think we're in it is this 1995? Is it 1999? But you're gonna pin me down but it but if I really had the answer that I would say this feels and I'm manage money all through the late 90s that this feels like mid late 90s. This is not mid, mid or late like so in mid, I feel OK about later. No, I would feel OK about this. This is not 1999. I'd say it's 9798. And and stock like NVIDIA is a perfect example. It's expensive, but it's not as expensive as those stocks got in the late 90s like Cisco and others at AOL. And it has real earnings. It has a toll road for AI, which is you can't get there except through NVIDIA. So that's a class plastic picture. So it's selling at 40 or 50 times earnings, but you know, Cisco got to over 100 times. Oh, even in recent memory, Netflix and Tesla were over actually. So I don't think we're there yet. And I but I don't see a thing that stops us from getting there. So I think we're kind of on the road there. So it's, you know, it's a double edged sword. See if the chase is on at some point. Exactly. At least we don't have to worry about those rate hikes if they're coming. Chris, thank you very much. You're very well. Good to see you. You too, Chris Crisanti.

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