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We were just talking Brian, you know, listen, obviously, you had the gross scare, uh the that jobs report, the panic selling, uh Brian. But now, big, sharp rebound, the SPX, the S&P 500. You're back, really near all-time highs here. Curious to get your take on these markets, Brian. What you make of it and where do you see us headed from here?

Well, I think the markets are getting optimistic that the Fed and and and Powell will be able to ease their concerns about pushing us into recession to solve the inflation issue. But in my mind, right now, it's all about jobs, which will drive the direction. If Fed is if Fed's cutting rates into a worsening employment market, I think the market will view that as a a negative read. If they can get through Friday, indicate to the market that they're about to cut rates and employment numbers stay satisfactory, I think the market will move to to new highs again. So, right now, I'm focused all on jobs. I think jobs have always been the disease and inflation the symptom. The Fed now has permission to act, but have they are they doing it fast enough is the key question for the markets right now.

Um, and do you think that we are as we see this rebound back to new highs in the in equities, Brian, do you think that we are entering sort of a new market cycle if you will?

I think it's too early for that. I I think the market wants to believe we are. Right? Many investors are choosing to be brave or balanced. I prefer balanced over brave right now. If you're brave, and you think the Fed has stuck the landing, will navigate and push us through that ever closing window and start a new market cycle, then then you want to be aggressive. You want to buy beta, you want to buy deep value, you want to buy leverage. I think it's a risky bet given where we are with markets right now. I prefer to be balanced. I prefer to use the industrial sector as an example to offset transportation, which is an offensive category with waste collection, which is a defensive category. So, in my mind, it's too soon to get conviction in the start of a new cycle. Prefer balance right now over bravery in my mind.

What about Brian, just thinking some other sectors. What about health care for example? Would that would that be another sector that fits that thesis?

I think health is a great place right now to find undervalued secular growing companies. So, I look at a name like Charles River, for example, a company that's a leader in clinical research. And clinical research spending has slowed down a little bit with the hike and interest rates over the last two years. You saw biotech funding slow, you're seeing consolidation in the space, driving some rationalization of of research and and um clinical uh paths. But ultimately, Charles River is working through uh this this downturn to become a a a market share leader in their space. They're going to gain share in the next cycle. So, I'm using the cyclical pull that back in clinical research to buy a secular winner in Charles River. Healthcare today looks like a lot of opportunity for uh lower priced stocks that have longer term opportunities that are underappreciated.

And how much are you looking at healthcare as well um because of its typically sort of defensive characteristics?

Yeah, it certainly is a great place to look for defense. The stability of cash flows there traditionally is very good. I think the experience of COVID is an outlier in that regard where we saw healthcare spending slow drastically. Typically, it stays pretty strong despite economic pullbacks, which we still might have. But again, speaking of a balance. If I'm going to use healthcare as my defensive balance component, where can I find some offense that benefit from a generous Fed, if we were to get that. And like material sector today, materials, chemicals, packaging. I'm finding opportunities there that will allow me some exposure to a growing economy where I can play offense to offset my defensive healthcare position.

What are your thoughts, Brian, on Big Tech, you know, of course we've heard from all those big names, accepting video and they they give us their report next week.

Look, I think Big Tech right now is all about showing me the money, right? Big Tech's investing a lot of capital into this AI theme and investors have grabbed onto that and said, take me for the ride. But we're getting very close to that moment where they need to show us the return pattern. They need to show us they're going to actually generate new revenue opportunities off of this. And so whether it's Meta, Microsoft, Alphabet, they're getting close to that tipping point of having to show us the money. Now the video, I think's an early winner in the hardware side. Um, I I think that's that stock uh has a high bar for the market right now. But ultimately, I think these stocks are getting close to the point where they need to drive economic returns as opposed to just showing us a story and a theme about the AI trade.

Um, and Brian, I'm you know, we're in the midst of the Democratic National Convention right now. Of course, a lot of folks are focused on the um political season and its effect on stocks. Do you are you getting those kinds of questions from from uh clients? And what are you telling them?

We get the question a lot, but I what I tell them, what I encourage them to do is to to not get caught in the noise, right? A lot of us have um we all receive information from different paths and different uh outlets, and that information often times is a short-term noise and has really limited impact on the long-term fundamentals of businesses or the market overall. There's a long history of markets doing quite well under all kind all different regimes uh in the US, and I expect that would be the case today. I think right now what you want to do again is focus on balance in a period of of volatility or uncertainty. So, we don't know the outcomes of elections. We'll never be able to predict that. We don't want to bet on that as portfolio managers. So, make sure your companies uh in your portfolio are balanced for various outcomes that could happen. I think don't allow yourself to get caught in the trap of trying to predict outcomes of elections when investing uh in different equities.

All right, Brian, thank you. Appreciate it.

It's a pleasure.