In today's episode, Tyler covers a memorable back-to-back turnaround Tuesdays for our markets, highlighting the important factors affecting our markets, including tariff developments, innovative disruptions, Q4 Earnings, and the latest from the Department of Government Efficiency (DOGE). We'll also explore the intriguing advancements in sectors like autonomous farming and cutting-edge technology platforms, which might accelerate the innovation revolution. Tune into today's podcast to learn more.

Don’t look back because the market is closed. Good Tuesday afternoon, everyone. Tyler Herriage here with you for today’s VRA Investing podcast. Hope you all had a great day out there today. I’m certainly doing a little celebration here today because I can’t believe I got the turnaround day Tuesday here today. If you’re a regular listener, you know, Kip and I make this joke often that I often get the down days and he gets the updates. So last week I got the deep seek sell off on Monday and Kip got the turnaround Tuesday. Well, this week we got the flip side of it where I, Kip got the sell off yesterday on the Tara Fears and I got the turnaround Tuesday today.

So, hey, I’m, I will certainly take it. Glad to be here with you today, as always, even on the down days. Still glad to be here with you. But that does now make back to back weeks here where we’ve seen Monday market sell offs with a turnaround Tuesday. As Kip talked about yesterday, it’s a major reason why we say never sell on a Monday. Right. Even if you’re not bold enough to stake a position on buying, you know, these Monday sell offs typically resolve higher into a turnaround Tuesday. It is the sign of a bull market as well to get those turnarounds.

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You know, if something were to change in that, of course we’d report on it here. Here. We don’t see that, though. As you know, we remain extremely bullish on this market and want to use opportunities like yesterday and the week before as buying opportunities. We think that that will continue. But last week it was on the deep seek news, which, you know, from multiple angles now, you might end up being a little bit of a benefit. The first benefit, as Trump mentioned the day of that, it was a wake up call for our tech companies here. You know, they thought they had the big lead, Right.

Regardless of how they caught up, to us, that mean we still need to go to the next level. Right. We look at this again as part of the innovation revolution, which there’s always going to be disruption along the way, but that is a feature, not a bug. And these disruptions ultimately we see as more bullish signs for this market. We’re going to see a whole lot more disruption in the coming years. Some areas you may not even have expected yet. I might touch on that here a little bit later today. Got one story we’re kind of just covering.

Not, not we don’t have a position on it, but, you know, just another application of the innovation Revolution in an area you might not think quite as much about. But we’ll see. You know, I’ll go ahead and cover here real quick. This is one I, I’m going to talk about ARC here in a little bit. But one of their positions they’ve been getting into recently has been deer, which I remember, you know, from years ago when I was still am, but was really into the agriculture side of things. I was more involved in those industries out of college and I started learning about what the new John Deere tractors can do. First and foremost it was because they have the, you know, all of the, the right to work on your equipment lawsuits going on because John Deere you, you can only work on those tractors by, from a certified mechanic for John Deere. I believe that, at least it used to be the case.

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I’m not sure if it still is. They’ll go after you for modifying their equipment, which there have been a whole lot of lawsuits against them filed for that. But one of the things they’re doing now that I heard about back then and I’m sure has come a long way since then, is their autonomous tractors. You know, much like Tesla is the leader in full self driving on the road, John Deere is likely the leader on off road. Right. In the farms where you see a whole lot of, you know, farmers now instead of driving and working on a tractor, these new tractors, you’re there to supervise on these things. You know, I’m sure that’s only the wealthiest of the wealthy major farms, major corporate farms out there that are using these. Probably at this point it’s not your mom and pop farmers that are using them, but much like Tesla, as the costs come down in these things and makes it more approachable to people like that, you know, the interesting topic on that one is of course what we’re doing with the deportation side of things now.

I’m sure we’ll still have a lot of green card workers who come in kind of the seasonal migrants. Right. I haven’t seen anything about that being disrupted yet of letting people over seasonally for harvest times. So we’ll see though, you know, and I, I believe I saw a stat on this the other day that illegal immigrants make up a small portion of our farmers, which is obviously the funniest part that you see the left argue about like, you know, who’s gonna pay, who’s gonna pick our food if you deport all these people? Well, so you’re saying you want them here because they’ll accept a lower wage. Right. They think that American workers don’t want to do this and won’t accept that low of a wage. So they’re saying, you know, essentially you want immigrants to do it here because they demand, they don’t demand higher wages, they don’t demand health benefits. Sounds a lot like modern day slavery, really, when you think about it.

So it is hilarious to see the mental circles the left has to go through with this. But there’s a solution right there in, in another feature of the innovation revolution, you know, autonomous farming and agriculture innovations. Right. That’s an, would be a major disruptor in that field. One that we think ultimately would be good long term because it hurts at the time. You always hear the stories that this is going to cost thousands and thousands of jobs. We do, we’re, we’re optimists here. We think for every job that likely gets replaced, there’s probably going to be 10 more that get created because of it.

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Right. That’s been the case with innovations throughout history, including agriculture. Right. Look at the, the cotton gin. I’m sure there were a lot of people at the time that said, imagine how many jobs this is going to kill. And instead it opens up new opportunities in textiles. And, you know, instead of having to spend time on the actual picking of the cotton, you can figure out new things to do with it or just focus on other areas in general, because now you have the free time to do those things. And what it ends up culminating in is more prosperity for all.

A rising tide does lift all boats. That’s our belief here. So again, kind of back to my topics here. So last Monday was the deep seek story. This Monday again was the tariff story. You know, we’ve seen this time and time again from front Trump’s first term to today, where during his first term there’s a whole lot of freak out about tariffs of stuff that, you know, didn’t end up being too bad and ended up being pretty prosperous in the end. So similar to what we’ve seen here, big freak out yesterday. And even before the close, we got a big rally off the lows as it was announced that Canada and Mexico quickly bent the knee to Trump’s demands there.

Now, China’s tariffs did go in to effect today, I believe as well, the 10 additional tariff. Let’s see here. I want to make sure I get this right. Yes. So roughly a 10 tariff added to China. China has announced retaliatory tariffs here, a 15 tariff on coal and liquefied natural gas, so LNG imports and an additional 10 on crude oil. Agricultural equipment and automobiles. I believe that starts on February 10th here.

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They’re also placing export controls on certain rare earth minerals, which we’ve heard Trump talk about recently as well, part of his negotiating tactics with Ukraine so far. Right. And, and it negotiating the Ukraine, Russia situation of how can we get. Ukraine has an abundance of rare earth minerals as well. It’s very valuable land there for more reasons than just the minerals. But working out a deal there to try to get access to more of those rare earth minerals while getting the processing done here in the United States, that’s a big part of what we see from deregulation as well, and securing our supply chains. Not only just bringing semiconductor production back to the U.S. right, as we need to do more of, but also in the materials that go into those semiconductors.

Because so often we buy them from other countries and a lot of times these aren’t our allies even. They’re adversaries that we’re buying from, as we see here with China. And a lot of these we do have here in the US but we’re not currently mining them. Whether it’s because we can do it for cheaper in another country or because of more needless regulations here in the US there’s all kinds of different reasons for that. Uh, but the story here remains interesting. You know, back to the, the tariff side of things. You know, if this story is going to turn out like anything, like Colombia, Canada, Mexico, all already, it would appear here that Trump does have his pulse on the levers of influence for these countries. He knows how to hit them where it hurts.

Now, something that he figured out from his first term. Right. We saw how quickly these other countries have capitulated, you know, now let’s see if we can get the same to be true for China as well. You know, we know that Trump wants to work in a more cooperative and competitive manner with China, but not in a way that leads to a trade war or other kinds of war as well. So, you know, let’s see. It’s. It’s already been a hell of a ride, you know, and it’s been amazing to watch it, how quickly the Trump administration is moving here. Whether it’s the tariff story that I just mentioned or what the DOGE team has already unveiled about usaid, the unbelievable stories of the, of the things that these, that USAID has funded.

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Just. I just saw this one before the podcast. They’re the second largest funder of the BBC, the propaganda network, literally state owned news. They’re the second largest donor to. Why, why are we donating to other countries news outlets. Right. And that’s just, that’s actually a more flagrant abuse of it. Some of these go under the radar, dude.

They aren’t quite as big of expenses, but they’ve been calling them out whether it’s funding, you know, drag shows in Peru or just, you know, stuff that we have no business spending US Taxpayer dollars on. So those have been really fun already. I mean we’re just again a few weeks in here and these are already coming to light. Now it’s looking like his cabinet should be fully staffed and confirmed here shortly. RFK confirmed today, I think that Tuli and Cash Patel remain now, but by the time this podcast comes out those might have been confirmed as well. Overall, the work has been moving at a lightning fast pace, especially light speed pace compared to previous administrations, I would say for sure it’s tough to even talk about them all in one podcast. But I love what J.D. vance had to say about today.

This is a quote from him earlier today about the pace that they’ve been moving at. He said this is the new normal. Expect this rapid fire breakneck pace to continue for four full years. You just love to hear that. How refreshing is that? Yes, they’re moving at a lightning fast pace. They acknowledge that and they want to crank it up. Let’s keep moving faster. Let’s keep going here.

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This is how we get to the golden age that Trump is talking about and do it quickly here. You know, enough quibbling over these small problems. Let’s move forward here. Let’s solve real world issues. Right? And that’s what we have the opportunity to do here. And you know, I, I do think that they’ll keep up this pace and we’ll continue to see really innovation on the government side of things as well. If we could get into that topic as well. And what Trump, sorry Elon and his team of, of young coders has done at the treasury, treasury and the, the anger from the bureaucrats that we’re seeing from them.

Right. It, that’s, I could do a full podcast on that one. But, but now it’s our opportunity to take advantage of this as well and to contribute what we can to usher in this golden age for America. I know that we’ve talked about that here a lot on the podcast. We’re excited. We hope that you’re excited as well. And we think that our portfolios will reflect this optimism later too. On that note, on the innovation note, one last point.

I said I was going to talk talk about ARC earlier As well as they released their Ark Invest big ideas of 2025. This is. They do this every year. They laid out their five technologically enabled innovation platforms that are evolving today. These included. I’ll just list them here. I’m not going to cover them in detail, but that includes 1, artificial intelligence, 2. Robotics, 3, energy storage, 4, public blockchains, and 5, multinomic sequencing.

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So the full array there from technology or. Well, all of these are technology technically, but from AI to healthcare, these are all industries which are going to be disruptive. And you know, these are. They say these platforms should drive exponential advances across industries and catalyze a step change in global economic growth. Growth. Again, I won’t break down each topic here, but you know, we’ve been in sync with Cathie Wood and ARC on this for some time. Even before I found out about arc, I was a big fan, learned about, you know, in college of, of Moore’s Law specifically, which, you know, I’ve covered this on the podcast here before, but it’s been a while where Moore essentially predicted that the number of transistors in a micro triple would double every two years. And that has set the pace for innovation that has held up so far.

And I’ll get to some interesting points there in a moment. But then Kathy Wood is also a huge fan of Wright’s Law, which actually predates Moore’s Law, which states that for every cumulative doubling of units produced, cost will fall. And that’s different from Moore’s Law because he said, you know, it would. The doubling every two years would, you know, more than make up for the cost increase. But Wright says it’s going to double and the cost will decrease. Right. And so what ARK showed today in a lot of, you know, the speed of innovation in artificial intelligence, the speed of adoption of the blockchain network, there are so many factors that these two, you know, they’re more theories than real. Like, you know, it’s not like Newton’s laws, right? These are more theories.

And so what has been shown though, and there are mathematic numbers involved, they aren’t just saying, oh, it’s going to double every two years. There are equations to map it out. And what percentage change should happen specifically in Wright’s Law, what the cost, the cost will fall by a constant percentage. And what ARC’s work shows here, though, is that in some sense it’s both Moore’s and rights laws that are correct. But in one way they both actually haven’t held up. And that is that the pace of Innovation is actually accelerating at a faster pace now. So not only are we doubling memory and capacity every two years and costs are falling, that pace is accelerating now. That’s why, if anything, you know, Moore’s Law and Rice Law almost weren’t ambitious enough, as ambitious as they were and disagreed upon as they were at the time.

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You know. So again, another factor here contributing of what we see coming from the innovation revolution. This is only picking up pace. So we think we’re due for an exciting period ahead. As we’ve talked about here often after the last two decades of what we’ve seen in the US and the destruction of our country in the say, confiscation of our rights rather, you know, under the Biden administration or under the Obama administration or while the bureaucrats were still working under Trump’s administration. Right, Working to stifle free speech on U.S. citizens, taxing us into oblivion, regulating everything so that it would take longer for a piece of paper to get across a desk than it took Elon Musk to build the starship. That’s one of my, the most incredible stories to me that under the Biden administration it took longer for SpaceX to get clearance from the FAA for a launch than it did for them to build the rocket, the most advanced rocket the United States has ever seen, more advanced than the Apollo missions rocket.

It took longer for the paperwork to get done than it took to, to build the damn thing. Right. That’s what is in our rear view mirror now. And I think we can all get excited about that and think about that’s, you know, one story from a very niche industry for space. This is going to now take place, deregulation for oil and gas, for agriculture, for manufacturing, for so many areas. And it’s going to save, it’s going to increase productivity because we don’t have to worry about all of this bureaucratic paperwork that we get drowned in here. So again, incredibly exciting time here. I’ll move on to the next topic now, which is earnings.

Today we had some big ones after the close. Google, which actually hit an all time high during the session today, came in with a slight miss on revenue, a slight beat on earnings per share. But the market, we’ve seen this from, you know, Q4 earnings as a whole, that the market is punishing any miss from these companies right now. So, you know, that’s the kind of thing that could turn around quickly. But the initial reaction has not been ideal. Again, we hit an all time high today for Google now down 8%, roughly 8% in after hours trading here. But what the market probably really didn’t like here was that they missed on cloud revenue. That’s been, you know, one of the fastest growing revenue sources for these tech giants in the last few years.

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Whether that’s Amazon and aws, Amazon Web Services, Microsoft with Azure, Apple with Icloud. You know, these are very fast growing divisions specifically though for Amazon and Microsoft, very fast growing divisions that have been money printers for these companies. So the market doesn’t like a miss there. And now it really turns all eyes onto Amazon again with their Amazon Web Services division. I’m sure a lot of people will be watching for that number there. But on the plus side, from Alphabet, they did announce a big increase in CapEx on the year. The estimates for CapEx in 2025, over $58 billion. They upped that to $75 billion.

And so there’s some ancillary effects there. For example, Google uses the Broadcom chips for their AI systems. Broadcom up 4.6% in after hours trading. You know, on the expectation that a big portion of that capex will be spent from them. You know, Broadcom doesn’t report now until March 4th, so we’ve got some time there for that one. But we did have a chip maker after the close today which was AMD which initially was higher and after hours trader was up nearly 5% on the day to over 4 and a half percent on the day. Beat across the board here. Record quarterly revenue data center sales up 69% and they increased guidance for Q1, but it wasn’t enough for this market here.

Again in after hours the stock was initially higher. Shares have turned lower now down almost 8 1/2% for AMD. So we’ll see the reactions more so in tomorrow’s trading. You know, again another good sign here to see a good turnaround Tuesday here today we still want to see the lows from last Monday hold, especially in the semis here. But as bullish as we remain, there’s one other factor that we love to see and that is the fear and greed index, as you might expect, got it back into fear territory during yesterday’s Monday sell off. But what might be interesting is that we fell further into fear territory despite the Nasdaq being up 1.3% on the day. And our major index is higher across the board. We finished yesterday at a 44, finished today at a 39.

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So moving in the opposite direction again, as contrarians, we don’t mind seeing that kind of a move. Here we get the AII Investor sentiment survey back on Wednesday evening, Thursday morning as well. We have seen some very interesting fluctuations there. So stay tuned. We’ll be reporting on that here for our major indexes on the day. Let’s take a look at our markets here. Again we finished higher across the board led by the small caps today up 1.4% to 2,290. After that the NASDAQ up a nice 1.35% on the day.

And I’ll point out here that the semis did have a good day here as well today. Didn’t quite lead the Nasdaq so you know that’s what we would have preferred to have seen. But still a good day up 1.13%. Next up the S P 500 up over 7/10 of 1% on the day today. I just want to run a quick number here today. It was amazing to see the fear and greed index at in fear mode when you’ve got the SB 500 less than a percent or roughly a percent and a half away from its all time high still. And then finally for today the Dow Jones did dip into the red briefly today, ultimately finishing higher on the day up 3/10 of 1%. And something that you do like to see from this group is the transports leading.

They got hit hard after last week ended to yesterday’s trading as well up a nice 1.1% on the way on the day today. Also I’ll point out here yields moving lower here today. This remains part of our longer term view that we expect yields to move lower from here 10 year down 6/10 of 1% at roughly 4 1/2 percent, 4.51 to be exact there on yields Next up looking at our internals on the day to day, much better numbers. We needed a day like today from the internals and we want to see this continue. You know some nice beats out there today. We had more advancing stocks than declining stocks on both the NYSE and the NASDAQ. Over 2 to 1 positive on the NYSE and almost 3 to 1 positive on the NASDAQ. 52 week highs and lows came in positive for the NYSE, slightly negative for the NASDAQ.

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But as we talk about here often, you know there’s plenty of not quite prime time players in the Nasdaq. So no concerns. Excuse me just just yet for us there and then finally here volume, you know not the bullish breath thrust kind of day where you get an 80, 85% upside volume day. But compared to the internals we’ve Seen recently. Some good beats here coming in positive for both the Nyse and the NASDAQ. Almost 3 to 1. Positive for both of these here. Yeah, pretty close there.

Roughly 71% upside volume on the NASDAQ today and just shy of 70% upside volume on the NYSE today. So good days from the internals again, we want to see that continue here. Looking at our sectors on the day. As we say here often new highs beget new highs and we did get at least one all time high from our sectors today. That was the communication services sector. One we’ve talked about here a lot is Meta has been on a tear. Meta closed at an all time high today. Didn’t quite get to an intraday all time high.

But Meta and Google are the by far the two largest holdings there. So Google selling off might hit it or will hit it tomorrow. But Google also hit, as I mentioned earlier, an all time high today as well. So it makes sense to see communication services doing that. Our leader on the day was the energy sector, followed there by tech and consumer discretionary. Just real quick here, couple of other all time highs today. While I’m on the all time high topic, Amazon hit an all time high today and Netflix hit an all time high today as well. Again, you know, maybe not be companies that you have a position in, but new highs beget new highs.

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Then our laggards on the day today, you know, interesting with yields lower that utilities actually led the way lower today. But that’s all right. Followed there by consumer staples and financials. Then healthcare, you know, really defensive, more defensive leaning sectors there. So no big concerns on RFK’s nomination confirmation. Excuse me. Today healthcare stocks did sell off and rightfully so. No love for these companies here, absolutely not.

That have lied to the American public time and time again. Whether it was the COVID vaccine lies the opioid epidemic. The list goes on and on and on. Far further than most people care to even investigate, to be honest. It is disgusting. So not. I don’t mind seeing Moderna down six and a half percent on that news today. All right, finally here for today, our VRA Commodity watch.

Let me get a quick refresh of my screens here. Gold did hit another all time high here today at $2,874 an ounce. That’s where it is. Looks like where it is right now as well. Good to see is on top of that the gold miners continuing to look like a breakout here, making another highest level, let’s see since early November. Good to see. We want to see that continue as well. Hitting a little bit of short term overbought readings, maybe a little bit more room to run.

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But it’s only a matter of time before this group really takes off in our opinion. Next up there, silver now up 1% on the day to 32.88 an ounce. Copper now essentially flat on the day at $4 and 36 cents a pound. Oil lower on the day by half a percent to $72.75 an ounce. You know, as much as we do, just like energy companies as a whole, even if we trade that position pretty regularly, I’m not going to make a call on those right now. But just point being, energy companies can do well with lower oil prices and we know that Trump wants to bring oil prices down. We support that fully. We think the energy companies will fare fine in that.

So we wouldn’t expect to see oil continue lower from here from its, you know, we saw the peak just before the inauguration. What Was that? Roughly $79 a barrel. I’ll get a quote for you here. Don’t worry. 7939 a barrel where it peaked on January 15th. You know, nice downtrend line really from its peak from 2024. Where did I know it peaked before that? I’m just looking at a one year chart here. Wow.

130 a barrel in March of 2022. And it’s just been a series of lower lows and lower highs for the most part since that time. Again, no specific call on that on oil right now. But again with deregulation, lower transport prices as well. These energy companies are well financed right now and prepared, you know, to, to be able to continue to make money in an environment with lower oil prices. That’s enough for that topic here today. Finally here for today, bitcoin is now lower on the day continue to see ideas about the strategic bitcoin reserve. There was a little bit of an announcement out that about that today.

[00:28:51]:
Honestly I gotta do a little digger, bigger, deep, little more digging on that. There we go. And if that is the case and we are seeing Bitcoin now down 4% today at 97, 400, you know, maybe a little bit of a buy the rumor, sell the news event, you know, over the medium to long term. We absolutely remain bullish on bitcoin folks. That is all that we have time for here today. Please be sure to subscribe to receive our VRA podcast every day at the market close. You can sign up@vra letter.com, click the podcast link at the top and we’d love to have you with us. Kip and I will be on the road tomorrow.

We’ve got meetings in Houston, so stay tuned. There may not be a VRA investing podcast tomorrow. We’ll be back here with you as soon as we can, hopefully with some exciting updates as well. All right, folks, thanks again for tuning in. Until next time. We’ll see you back here tomorrow or Thursday for the close.