Biggest Market Shift Now: ‘You’re Making A Mistake’ Ignoring These Assets | Ted Oakley

Somebody has drank the Kool-Aid here. They've all wanted to be short. And you can imagine that's probably put pressure on the market to a high degree. But you can imagine what happens if that flips the other way. Look at US fiscal policy and you look at the Treasury and you look at the Fed and they say, "Look, you know what? We don't trust you. If you were doing a major financing, would you do a major financing with the US government today for 30 years?" I I doubt it. those Middle Eastern countries are are sort of forming together and the US has lost their influence there. Ted Oakley, founder of Oxbow Advisor is back. He was with us a few months ago when the stock market was considerably lower than it is today. Gold was also lower and oil had not yet rebounded from its lows. Now Ted is here with us. He likes energy. He likes a short end of the yield curve and there are certain sectors he likes more than other others. He's going to go over everything with us today about uh what he likes to own, what he would avoid right now, and what you as an investor should pay attention to the most during these very volatile times. Welcome back to Showte, Tech. Good to see you. >> Thanks. Uh David, good to see you as well. >> As we speak today, uh the UAE says Iran targeted a tanker in the street of Hormuz. Uh no casualties. The um crisis in the Middle East, the Iran war has continued to escalate. Just this week, the Iranians said they wouldn't deal with Trump again until his term or they wouldn't deal with the US at all until Trump's term is over. We'll see what happens. And uh ships continue to get struck in the street of why isn't oil at $100 a barrel? That's my first question to you. Well, you know, David, if I had if this is just an opinion, uh, but I think there's been a narrative out there among a lot of people that they expect, you know, it go right back to 50 or 60. And just to give you some numbers now, if you look at the CFTC shorts on oil, okay, it's a massive, massive short. In other words, it's probably in the top 10% than it's ever been. And just to give you an idea, it's something like 480 million barrels. Okay. Now, what that means is somebody has drank the Kool-Aid here and they all wanted to get there's not that many of them really. And so somewhere along the line, they've all wanted to be short. And you can imagine that's probably put pressure on the market to a high degree. But you can imagine what happens if that flips the other way and all of a sudden people realize, you know what, uh, I shouldn't be in this situation. Now, whether that's the real reason, I don't know, but that's one of the reasons I think I think um I think the US and everybody else has pulled out every stop they have to use their strategic preser reserves and everything, but they're running out of time and now they're running out of oil. So, we'll have to see where it goes from there. I've also been reading that China was a large contributor to the to the fact that oil was suppressed in the markets. They've stopped importing oil and of course like you said they've also used their strategic reserves. But there's only a limited amount of time before a country of that size could could uh withhold their imports and count on their reserves. Either they take their oil from Russia or somewhere else or they're going to have to go back to doing something. What what's that turning point that the world has to face Ted? What is the um the pin here that is going to force countries to I guess either act together and force a straight of moves to open or look elsewhere and we forget about this whole thing? >> Well, you know, David, it looks like to us and again this is just an opinion. I'm I'm like everybody else. But um if you look at it over there, it looks like we have the US has lost their influence there. It you know they you know think about it before uh oil was flowing, straits were open, nobody had to pay anybody to go through. Everything was this that and the other and everything we've done um hasn't worked really when you get right down to it. And so I think people look at that and and I believe it looks like a lot of those Middle Eastern countries are are sort of forming together and that we're losing influence. Now whether that plays out in different ways, I don't know. Probably with a lower dollar maybe. Um but I I believe that's that's what we've got here. And if you look at refiners in the US, a lot of those refiners for gasoline and Jeff, you know, they use a different kind of oil. And you know, as you get tighter and tighter on these things, nothing happens until it's too late, usually. Uh, and so that that's what I think you have in front of you. Now, whether that happens or not, I don't know. I'm not making a prediction on it, by the way. I'm just saying that's the setup that you have right here. And it could go against them right now. Well, you've liked energy in the past. Do you still like it at $83 at the WTI? uh meaning um at the current levels do you think maybe it's overbought? >> I don't think it's overbought. No. Uh I think if you look at the companies and we own a lot of oil and natural gas companies, but if you look at the companies, they're cheap on a relative basis. If you look at their, you know, their numbers, uh they're cheap. I mean, we we've got some of those companies at seven and eight times earnings, but a lot of them have their numbers have been good, their dividends are good, and I think people are missing a piece of the market. A lot of people just don't want to buy fossil fuel. You know, that's a hangover from uh, you know, from the last five or six years uh, that these groups that don't want to buy fossil fuel and I think they're make missing a point here. would you be um particularly favorable to the refiners or the producers uh or the explorers right now? Which segment within the oil and gas space >> do you think is uh is most positioned to gain from this current situation? >> That's a good question, David. I think you have to own the whole spectrum. >> Mhm. Like for us on the producing side, we own big producers like Chevron, then we own Matador on the on the midsize, but then we own the pipelines, you know, on the midstream. Um, and then we own G natural gas companies like Interero, Apache or APA, the it's APA now. Uh, and we own drillers, we own Slumber, we own Trans Ocean. In other words, you have to own the service companies, you have to own the producers, and you have to own the midstream. Uh, and we're not as big on the refiners, but uh, but you could probably own those as well. Before we continue with the video, let's talk about your most important asset, your personal privacy. Now, you've probably never voluntarily handed your personal information to a data broker, but they have it anyway. Your name, home address, phone number, even details about your family are collected and sold to whoever is willing to pay for it. That's why today's sponsor, Delete Me, is a service I use to cut that down. Setup takes a few minutes, and after that, their team does all the work. They find where your information is listed, verify it, and submit removal requests to hundreds of data broker websites around the internet. Then, they keep checking because these listings tend to come back. Since June 2024, they've been reviewing my listings. And my most recent report showed 335 listings reviewed last month alone. Scan the QR code here on the screen or go to jointdeme.com/david link down below and use the code davidin for 20% off. Take back control of your privacy today. Now, back to the video. Okay. All right. Uh on to the stock markets. Now we have a situation where uh the S&B is closing in on 8,000 points 7743. Uh meanwhile the long end of the yield curve has continued to go up. The I think the 30-year spent more than um 30 sessions now above 5%. It's now at 5.24. At what point does the long end of the yield curve start to impact the uh stock market negatively? In other words, how much higher can the yield curve go at least on the long end before the stock market valuations start to crack? >> You know, David, I think it it's just an opinion. Again, I I have no way of knowing that, but my guesses would be five and a half because once you get to 5 1/2, all of a sudden you adjust everything else. You adjust mortgages, you adjust what people are. You know, there's a lot of leverage out here. a lot of leverage that's based on floating rate and uh I could see five and a half really sort of pushing them over the sort of over the limit. >> Does corporate debt follow the long end of the curve or the short end because the 2-year yield has been staying flat if not going down. >> Well, it just depends on uh duration really. You know, if if if you're issuing uh if you're issuing the longer paper, it's it's going to follow the it's going to follow the Treasury long end. If you're in the short end, obviously you get a better yield on the corporates, but not that big a spread. I mean, uh, if you look at a two-year Treasury at four and a quarter today and say and say you're getting maybe 475 or 485 on a TR, you know, is it really worth is it worth it? Uh, especially since on the Treasury you don't pay any state tax. So, I think people have to look at that and make a decision on that. >> Meanwhile, margin debt jumps 7.9% in June. It's now hit another record high. Well, this was back in uh July 20th. This article was dated July 25th. We'll see if the monthly data updates and it's no longer at record highs after the wipeout in July for semiconductor stocks. But anyway, it was at one point early in the summer at a record high. Does that signal to you investor confidence in markets? And would that sentiment translate to actual performance, do you think? >> Well, it's what happens as a bull market matures >> because as you're successful on borrowing money and investing, then you borrow more and invest more. So, you know, people get caught up in that and it's like, hey, you know, it works so well. Let's just do more of it. And I think that's what's going on. In addition, I think people have, you know, they have all-time highs in their stock accounts, and I think they're borrowing money maybe for other things as well. Uh, and that really doesn't come home to them until you have a bare market, but but it's and it's a fairly high percentage of of gross market value as well. I mean, you know, it's not just just just the level itself. So, um, but I think it's indicative of where you are in a bull market at the end of it. Have you ever been so sure of a position that you just can't help yourself but to take on leverage for that position or maybe your entire portfolio? >> Well, the only time we've really taken on the last time we took on any margin for clients and this wasn't every client but a lot of them was at the low in '08 and early09. And it wasn't a lot. It was about 20%. But if you're finding yields that are 15 or 16 or 17% on the on the yield and you can finance that at like six or seven, then you just made a deal, a real good deal. Uh, and that's the last time we used any leverage at all. And the only time we would ever use leverage leverage is if you get to a point where your cash flow, I'm talking about dividends or interest was so high that your borrowing costs were so low that it made sense then to use some. But we don't you we we've only used it once in third 25 years really. So >> well would you consider resource stocks a leverage to the underlying commodity? or for example energy stocks that you own. Do you own them because you like the company or do you think it's because they're a high beta play to oil when you're long oil in a sense? >> Well, we like them because of the earnings look. In other words, we we feel like we look we have a good look at the earnings over the next six to eight quarters. They're cheap on a on a relative basis. is I mean we've got some of those companies that are selling at eight or nine times relative to 25 times in the S&P or a 42 cape ratio. I mean these things are cheap as they go along and the same rate really for the gold miners. I mean they're cheap but I'll tell you uh there's a lot of other things too if you look at uh tungsten and copper and iron. There's different things that we own because of the earnings of them. Uh and we like we like those. And so that's that's why we own them though because we can look at those earnings and say, you know, this multiple ought to be higher. >> Okay. And looking ahead now at the fourth quarter, you were on in Q2 giving us a Q2 projection for the final quarter of the year. Ted, are we looking at inflation to approach 4% since inflation has been coming down recently uh following the downtrend of oil, but oil has been spiking up? And so I think a lot of the inflation expectations now are baked into or are dependent on where oil goes. Do you expect the CPI to go back to where it's 4%. >> You know, David, I wish I I wish I was better at predicting I'm not very good, but if you look at things, I'll give you an example. Lumber, lumber, for example, which goes into everything we do in the US is just really been moving higher and and a lot higher. And of course, the reason is because we've got this deal going with Canada where, you know, we've got an argument going with them on this thing. And so, you know, we don't get as we we've got situations like that. You got situations like energy. And I I I I suspect that it would go higher uh a little higher. Not a lot maybe, but even to higher maybe even the next quarter or two, but again, that's just a guess. But I could see it next year um all of that stuff breaking down maybe and and and you going back to lower levels. But I just don't think that's going to happen in the next 6 months. >> Well, you told me offline that you are um positioned um to be long the short end of the curve. Uh but you're either you've either sold off your positions for the long end of the curve or you just don't like it and you're not going to go into that space. So, do you expect the long end of the yield curve to rise because of higher inflation expectations or economic growth or perhaps something else? Well, I think some of both, but the biggest thing is, well, first of all, we haven't owned the long end in a long time. I mean, years. So, that's not something that we own. Uh, we've always stayed short and probably shorter now than we have been in the past in a way. But what happens on the long end is that the it looks as us as though the Treasury is losing control of it because they keep you know he didn't want to I mean Besset didn't want to issue as much short paper but he now he's ended up issuing as much short paper as Janet Yellen did and because they just don't want to put any more pressure on that long end and um you know I think they're just kind of at a spot here where it's going to be a little harder for them and u you know if if if uh it looks like there'll be pressure on that for for sure. I just I can't imagine anybody the next 5 years even if you had a 6 month or 8month window where you got a good trade out of it. I don't think anybody should be looking at 30-year paper. >> Why has the long end of the yield curve been going up? At the last FOMC meeting a couple of weeks ago, a reporter asked Kevin Worsh why he didn't raise interest rates on that day, the Fed funds rate. And he his answer was, well, he kind of sidestepped that question, but his answer was, well, look at the bond market interest rates have been going up already, insinuating that the bond market's been kind of doing the Fed's job. Why has the Fed been not well, not the Fed, but why has the bond market been reactive in that sense? Why why has the Fed the bond vigilante so to speak for Turkey. >> Yeah. >> Well, I think they look at I think they look at US fiscal policy and you look at the Treasury and you look at the Fed and they say, "Look, hey, you know what? We don't trust you. Bottom line, we don't trust you." And I can't say that I disagree with that because uh if you were doing a major financing, would you do a major financing with the US government today for 30 years? I I doubt it, >> you know. Uh, and I think that's what the market said. They said, "You know what? We don't trust you." >> Okay. Well, do you trust what's happening right now with sentiment? Going back to the margin positions, it's an indicator of bullishness. And right now, um, there's increasing levels of optimism and uh, bullish sentiment through a variety of indicators is through the roof. And as you can see how uh there's been a sharp rebound ever since the beginning of August following July's decline in the tech space. And this rebound isn't I'll pull up a chart just to illustrate the point, but this rebound isn't gradual. It's something that you would describe as a V-shaped recovery here. Uh usually when that happens, uh is that an indicator that you should be loading up more on risk assets because that's where momentum is headed? Well, it it could be, but I I think uh what that's indicating is that, you know, people couldn't wait to buy the dip again, and so they they did. And see, that's my point that it just feeds on itself. So, all of a sudden, that works. So, let's buy some more. And you you always take that to a point to where someday, and I don't know what day that is, but someday, some month, you start to get selling in the market. And it won't be it's one of those things where uh you know the next time one of these times you buy the dip and it and it doesn't work. In other words, you buy and then you know it's like all bare markets. A month later you wish you hadn't. Um and we're not we haven't been through that right now. But I think that's why you got this move. And I wouldn't be surprised if uh unless something crazy happens if they don't keep it up for a while cuz that's just where you are in the marketplace. And you're exactly right on bullish sentiment. I mean it's it in every way. The B of graph that they run market vein anything you want to run a cape ratio like I said it's been up four months in a row. It's 42 now. I mean I mean uh if you look at the numbers the history of that when that ratio is over 35 you don't make any money in the next 5 years. So we'll see if it plays out this time but I I I would I'd certainly take a look at and keep it in mind. >> I was wondering if valuations have compressed uh since earnings have done well in the last quarter or so. Uh but it seems like you're right. Uh the cape here the Schiller PE ratio has just increased and gone up in a straight line. this despite the fact that valuations have gone up um uh market prices have actually gone up as well. Are you more cyclical or defensive now than you were in January of this year? Ted, your fund? >> I would not say so. Uh we're about the same. We have about 45%. We had about we raised a lot of cash in the third quarter. I mean the fourth quarter last year in the month of January because we sold a lot of the miners and we sold all the silver and we sold part of the gold but but we sold a lot of the miners. Well, they corrected 35 or 40%. So over the last 6 weeks we replenished all of that cuz we think they all of that stuff will do well going into the end of the year. Um, but on the earnings front, see, I'm not certain, David, we know exactly about the earnings because there's so many things, you know, they can have these private investments and these big companies and they, you know, they don't have to mark the market and but they carry them as a profit. You know, there's three or four things that went into the one big bill B bill that came out that adjust those earnings. Um, I'm not certain about those earnings. I I I really look at that and I think when you when you shake it all out that they they won't be near as good as what people think they are by just looking at raw numbers. >> Speaking of earnings, uh Trump has been um defeated by the Supreme Court. His tariffs were ruled to be illegal. Uh that's not news, but what is news is that the uh uh distribution of refunds is currently underway. Would you be looking into which sectors would receive the most refunds and and perhaps look into that? Now, I think some big tech companies have already started receiving refunds. Apple and Amazon are red and now they're trying to pass on to some >> uh pass on some of those refunds to consumers. But um would you be looking into how the rest of these uh refunds will be distributed kind of like a dividend to stocks in a sense? Well, you have a really good point and I'm going to say it this way, David. We're not looking at that uh ourselves. Uh but I would say this to you that does impact the earnings because if you come back and give money back to them, they're going to book it. And so, you know, that that that's another factor actually in this earnings thing. That's a one-time throw. See, that won't happen again. But you're right on that. I go I look at it a different way actually but uh we don't go in and look at companies that are going to get the most money cuz you know a lot of those c I give you an example um if you look at our chief investment officer and and myself you know we for the first time in 15 probably 14 15 years you know we've been a seller of Microsoft okay um and we've sold it from almost all portfolios except uh and we sold a lot of it for other people, but we've owned it so long that some of them have so much profit that we've had to been a little slower in taking it out. But we don't see a lot for a stock and that's been a great company for us, don't get me wrong. Um, but it's things like that you have to look at and say, where am I going to be in two or three years here with this company? Is it really going to produce for me? And I think people are blinded by these big hyperscalers right now. uh and they're not thinking about the next two or three or four years. >> Speaking of uh hyperscalers, you're in Texas right now and Texas is the site of a proposed number of new data centers that are going to that that are to be built. Currently, the state has a memorandum on um oh sorry, not a memorandum, a moratorum on data center construction. Uh they're going to examine a bunch of different issues including water. But uh Tesla wants to build the world's largest data center there. Uh the Gigafactory is supposed to be massive. 100 million um square ft of space. Uh I was looking at a map here. 52 There we go. Here we let me just pull this up. 52 data center sites on on this particular uh map. >> Yeah. Take a look here. Um how is that how is that going to change the local economy, you think? Well, first of all, on the moratorum, David, I would remind you that in Texas, we have an we have an election in two and a half months. >> Yeah. Okay. >> That probably all changes after the election. That's just a guess. Uh but the money usually flows into the coffers, the election coffers for one reason or the other. You have to be realistic about it and see what happens after the election. But I, you know, we're a lot of the small rural towns don't want them because it it it really they're out there for a reason because they like the quietness and and a lot of these big construction sites have really messed them up. Uh I think you'll still have a lot because we have the energy. We don't really have the water honestly. Well, we do in the southeastern corner of the state. We have a lot of water, but in West Texas and South Texas, you know, you don't have enough water. But uh and that's going to that's going to be the problem I think more than just the data center itself. >> But all these data set pop data set is popping up across the country, Texas in particular. >> Is that an investable trend for you? >> Not for us because we don't know where it's headed. Uh it's a lot like uh if you look at the fiber buildout uh black fiber buildout in 99 and 2000 early 2000 uh everybody thought that you know that was the that was you know we're going to it was a new paradigm going to change the world and everybody had to get into it and then you looked up 2 and 1/2 3 years later and they're like gosh we'll never use all of this and it and it didn't work out like they thought and so those stocks suffered. It wouldn't surprise me for have a lot of that go on now. Uh I don't know that. But there's not there's not enough for us to want to go in and and really play that game right now. That's not something we want to do. >> I'm going to pull up a comment um on one of my videos about um uh aluminum from an electrician apparently. I I'll find that. But my question to you right now while I pull that up is uh would you be investing in some of the commodities behind the construction uh as kind of a way to play this theme here? Copper, aluminum, um steel perhaps, uh construction companies. Um I I don't think the home builders benefit from this, but I think you get my point here. >> Yeah. No. Yeah, for sure. And I I will tell you, we've owned that group for a long time. In other words, we we've owned copper, still do, you know, in in the form of a couple of companies. Um, not quite as much aluminum, but a lot of copper, a lot of gold, a lot of and silver even in in a lot of those cases. And then we own iron, you know, we own tungsten, we own a lot of things that go into a lot of those situations that we've owned for quite, you know, quite some time. So, it's not something new to us really. It just so happened that it's playing probably stronger than it would have normally. But uh the biggest key to all of that is that the US unfortunately is behind the eightball when it comes to uh most of these minerals and critical minerals and metals and things like that. U the only we are not behind is on natural gas. But um that I think that's I think what's missing in all of this and that is uh in your race with China and Russia those two countries have a lot of the stuff that we're talking about and we don't have as much in many cases and so I think people have to keep that in mind because you're changing you're going you're going into this multipolar world right now when everybody is hoarding their own stuff and uh and I I look at that way same play with what you're talking about things that go into building and that sort of thing. >> Yeah, this is the comment I was pulling up here. Hi, electrician here of 20 years currently working on construction of a data center in Washington state. We use a lot of aluminum for electrical conductors for feeding switch gear and main feeders to electrical rooms. We're running miles of aluminum for these data centers on top of miles of aluminum cable tray for support of electrical conductors. I have never heard anyone mention on a peep about aluminum regardless of investment if if so much aluminum is being used uh this greatly reduces the amount of copper being used. U so yeah I think just to illustrate the point that copper isn't the only thing that's um valuable here but the the the federal government has started a fund a vault so to speak they call it a vault to store critical minerals. Do you do you um invest where the government buys? In other words, do you follow what the government does and buy what they do? >> Well, probably to a degree, but we've been earlier than they are. >> For example, we own uranium. And if you look at uranium in the US, I mean, we use uh I think we use 50 million pounds and we produce maybe two and a half. I mean, we're so far behind on uranium, it's incredible. uh most of it comes from somewhere else. So we you know we own uranium and we own a lot of critical minerals uh that are uh antimony we own tungsten we different things like that that that um are hard to find in in the US you know in in that period of time. So I think I I think we're ahead of them. But um and you're talking about silver, but you know, one of the reasons we we did own Alcoa, for example, is cuz it it got ahead of itself. I don't know if you remember it got up to 85 or something and went to about 45. Now it's headed back up now. You That's one of those things. But in the US is they're making those investments and everything and we look at them. Um you know, for sure. Uh but but I think you know the things we really look at are uranium. That's what probably the top of the list for us for what the US needs a lot more of. I mean we could really get in a mess with uranium. >> Okay. Now finishing off on precious metals. You said you sold off your positions last October or November >> uh in the November, December and January. Those the 90-day period sold a lot. Well, late January was the huge sell-off and that was the peak. Now, nobody knew ahead of time where the peak was, I guess. Uh, but you had a suspicion that it was getting overbought at those levels. Why? >> Well, we had had a double, you know, silver went up 215% >> in 12 months. And so, when you have something move like that, you have to take it, you know, because that's a commodity. And chances are, I think you had all these momentum buyers that came in the last three or four months of the year and the first month and the new year. And the momentum players always come in late and they're real hot money and when they leave they just sell at any price and we sort of felt like that would happen and that's basically what happened. >> That's uh that leads me to a question about when to book profits. Generally speaking, surely you were looking at other indicators besides just the price. Uh because your timing couldn't have been better, Ted, but you could have said to yourself, "Well, silver's up 50% already. That's that's that's huge." You know, we're up 80%. You didn't have to wait until it was up 200%. Right? Um you know, at what point do you say to yourself, "This is enough." Or do you look at other indicators to point to you that momentum is about to fade? Well, one of the things we look at on it, David, if we would like to be long-term capital gains, >> unfortunately, what happened last year in many cases to us is that a lot of the we had massive moves in his gold miners, I mean, and silver miners. I mean, we owned Heckla at nine bucks last year and sold it over 30 and bought it back this year at 14 and a half or 15. I mean, you know, I'm not making it up, but I mean, and it's the number one silver producer. So, what happens, you have to look at the numbers and say, "Okay, if I have that type of move, I need to take some." Now, I think what happened with us, too, and I'll just tell you honestly, we irritated some of our investors because they ended up paying they're going to end up paying some tax last year and they'll pay some this year because of what we sold early in the year. But you have to say if you know if you think they're going to correct 40 or 50%. You know, as a money manager, you've got to take some of that off. Uh if you think that's your potential here. And I think I think that's what happened with us. It's a really good question, David. I'll give you that because it's a hard question for retail investors. Um they'll a lot of times they'll say, "I I just can't sell because I don't want to pay the tax." I don't agree with that. You need to pay some tax. Uh, believe me, uh, because if you're making money, you're going to pay some tax. We didn't sell them all, by the way. We sold all the silver, but on the gold miners, we sold portions of them. So, you know, that sort of, but we we had to take some off the table, but it worked out because we bought them a lot cheaper uh, in the last, you know, in the last six weeks. Well, at least you're not in a jurisdiction somewhere in the world where they're debating where at least implementing taxes on unrealized capital gains. That's that's a separate discussion altogether. That would change that would change the way things operate. I think a lot of people also just don't know when to sell because they're either early or late or in their mind um you know, they think it could go up higher. I've seen cases where people have held on to something simply because they were too greedy and they lost all their gains. So many of my um past experiences have revolved around that case where I know a guy he went up 60% in a stock. Everyone's asking him, hey, my buddies are asking him, why aren't you selling? Oh, it's going to go up more. It's going to go up more. I just know it. And then it doesn't go up more. And he lost everything on that particular position. Um other people have sold too early and they beat themselves up for it. I think psychologists have made the point where arguably that feels even worse naturally losing money. >> You know, David, uh I would say this on that. >> Yeah. I'm going to give you two instances where like if you look today at the big companies Amazon, Apple, Microsoft, uh you look at the big the big names Netflix that that a lot of people have owned for a long long time and they have really really low cost basis and their argument is I don't want to pay the tax. I don't want to sell any of it which we don't think is a smart move. In other words, you need to take take your cost out and take some profit out. But um I'll give you an example. From the mid80s till about from actually late 80s till about the late 90s you had a 10-year run on all the all the drug companies. Merc Fizer all of them went up huge numbers. Okay. And we could not get people that had those positions to sell any. And the reason was every reason was this. I don't want to pay any tax. Well, here's what happened. you had to go another 23 or 24 years before you ever got back to those prices again. So they gave up not only the chance to make money, okay, but they gave up if you they factor in inflation over that period. They're way behind, but they only and they still look at they still carry them, you know, they have big profits on them, but they they're like, "Well, I I can't sell. I don't pay the tax." I'm like, well, you've got to factor in the value and the time value of money if you're inflating. And they forget to do that. And that's why you want to sell pieces of it. Take your cost out, take some profit out. And uh, you know, just keep that in mind when you're looking at these big positions cuz the retail industry today, number one stock is Apple, I think. Um, and I think they're going to sit there and watch these companies uh, and just have the same idea. I'll never sell because of taxes. And I can understand if you're 80 or 85 years old and you're going to die pretty soon. You know, you get a stepped up cost basis. That's one thing. But if you're 50 years old or 60 years old, need to take a look at it. >> Do you have a rule for how long you wait before you book profits? >> Yeah, we we we normally we like to hold a stock if we can. We like to hold it anywhere from 3 to 10 years. I mean, that's what we're looking at. If if for some reason though in a year or two you get this massive move, okay, that actually made the stock overvalued, then we're going to sell some of it. That's for sure. >> Yeah, cuz it's not worth it. Then >> to uh to end the discussion, you said you were buying back some precious metals at current levels. >> Yeah. >> Or you're recently doing that. Can you tell us more about um that process here? >> Well, if you look, I'll give you an example. We bought gold at 4,000, you know, 4,50. It went a little lower. Went 39.50 or whatever and it came back to 4,000 two or three times. I think you can still buy it 4,300. I I think gold is is going to do well in the last half of the year, but on the minor side, you know, we we went back into uh we went back in the royalty companies, Franco Nevada. Um, you know, we added we added uh eight we added hecka like I say on the silver miner side. We had we b went back into AO Eagle bought a little company um well we bought Alamos Gold which is a great company bought uh we bought a little company called Equinox selling at five and a half times earnings 27 earnings and it's still a great buy. Um, but I and then you know uh uh and we bought uh added some silver back just a straight silver. So that's what we did. We went back up to where our our holdings are back up percentage wise what they were last year but we just have them at a lot cheaper price right now. >> Okay, great. Uh Ted, of all the uh assets that we talked about today, precious metals, base metals, uranium, even oil, we talked about oil, uh tech stocks, bonds of different durations. What's something you like the most right now? And what's something you like the least? Well, I I'd have to say the least is easier for me because uh these really big name semiconductors. I mean, I I I think people that don't use this as a time to sell those are going to pay the price. And that's a group that's feast or famine. I've been around them for 40 years and they've all the way back to Texas Instruments and they it's feast or famine. I mean, you're going to blow them up, but they're going to come right back, give it all back one of these days. And I think people have to keep that in mind. That's on the negative side. On the positive side, I think you can do a mix of a number of things, but I certainly think you can add energy, you can add gold miners, you can add gold, but you can add other things like we took we we have a position in Lionell Chemical six, you know, 5% dividend, and that company's turning around making changes, you know, that that that we like. We own Bristol Myers on the drug side. We own uh if you if you look um it's starting to look great again for Visa and Mastercard. There's a number of things you can own in here that are are a little different from the rest. But I do think you need a commodity. You need a portion of your portfolio in commodities. I think you're making a mistake if you don't because we feel like uh the next 10 years you're going to be in more of a commodity cycle, hard asset. And right now, as interest rates on the long end of the curve go up, would you be uh more overweight financials than you were maybe last year? The bank the banks recorded great earnings last quarter uh and some analysts say they're going to continue to book good earnings into the next quarter, especially as the yield curve steepens, which has historically been good for financial stocks. What do you think of that sector? Well, I think you have to stay with the regional banks because they're the ones that still do banking as banking. You know, all the big banks, you know, they're making money in every way you can think of from trading to merger acquisition to any any any of these you can throw in there. I think they're real expensive. I mean, a lot of them are three times book value and that's we only own one bank, US Bank. But I think you want to if you're going to own those, you ought to be uh you know with with the regionals if you're going to go that direction. But that's the only way I would see it. I'll just end on this personal anecdote. A long time ago when I was still a student, we had this um we went to this seminar where we met uh different uh different investment bankers and uh uh managing directors who were hiring and I think it was a recruiting event. Anyway, um, one of the pieces of advice they gave us was, uh, this guy told us, he's a managing director somewhere. He says, "Don't ever come to an interview and pitch something like City Bank because I've spent 26 years of my career analyzing City Bank and the financials. I don't I still don't know what they do. So, don't no one's going to believe you if you think that you know what they do." And you're 21 anyway. >> That's sort of the way we are on airlines. I did a study Oh, not too long ago, really, a few years ago. But if you went all the way back on United Airlines, you never made any money on it. >> Why is that? >> It's just never if you take from the time they came public to now, you wouldn't have really ever made any money on the thing. >> All right, fair enough. Ted, it was always good to have you back. Thank you so much for coming back. Tell us where we can follow your work. >> Yeah. And uh >> most well David, uh really the best place, and we're very transparent, but it's oxbowadvisors.com. >> Yeah. and everything we do on there. There's some books if you want to order one of those, we'll we hope to have a new one by the end of the year. So, uh, we're we're but but there's any letter we put out. It's all there. You can get it all on the website, oxbowadvisors.com. >> I'll also mention that Oxbow has a good YouTube channel where you do uh regular updates on your views and uh positions. So, check it out there. I'll put that link in the description as well. Thank you very much, Ted, for coming back. Hope you have a great rest of your summer and we'll speak again soon. >> All right, David. Good to see you. >> Good to see you as well. Thank you for watching. Please do like and subscribe. Follow Oxbow Pro Advisors link down below.