In today's episode, Tyler breaks down an incredible last week that's felt like a decade of history-making events. We'll delve into some exciting announcements, such as the formation of the Department of Government Efficiency, spearheaded by Vivek Ramaswamy and Elon Musk, aimed at radically transforming government spending by America's 250th birthday in 2026. We'll also explore key economic data, including CPI figures. Stay tuned as we break down today's market action, sector performance, and our outlook on commodities and cryptocurrencies.

Don’t look back because the market is closed. Good Wednesday afternoon, everyone. Tyler Herridge here with you for today’s VRA Investing podcast. Hope you all had a great day out there today. It was certainly another eventful day here all around. And you know, the whole, as the old saying goes, there’s decades when weeks happen and weeks where decades happen. And this has certainly been one of those weeks where decades of things that historians will talk about for a very long time have happened just this week and are obviously are still ongoing, but beginning with the historical second election of President John Donald J. Trump.

So it began there, this incredible stock market rally we’ve had. And now, you know, I do try to avoid some of the political sides of things, but gosh, this is exciting right now, isn’t it? We’re starting to see some of the promises that were made on the campaign trail already coming to light. And he has. Trump hasn’t even been inaugurated yet. I gotta say, for me personally, I think, you know, the most exciting one has to be doge, the Department of Government Efficiency, which is going to be headed up by Vivek Ramaswamy and Elon Musk. And just to the goal being to radically transform how our government spends its budget. And I’ll go ahead and start here with this. I wasn’t planning on it today, but you may have seen that Trump has already started planning for America’s 250th birthday, which would be it’s going to begin or end on July 4, 2026.

[00:01:54]:
And so Trump is allegedly given Elon and Vivek until that time to radically transform our government spending and make our government more efficient, get the bureaucracy out of the way, get the people who would prey on our downfall, Right? Who would rather go back to the World Economic Forum, Klaus Schwab view of things, the kind of, I guess you would call it, neo feudalism, where you’ve got the elites who own everything and then the general population. That’s what, you know, in my view, what they want for us, Right. It goes back to the World Economics own Economic Forum’s own ad that I’m sure many of you have seen that in the byline of the ad says you will own nothing and you will be happy. Right? Because they own everything. The elite own everything. So again, kind of a neo feudalist kind of view of the world is what they want. We’ve got to get these people out of the way first and foremost. Right? But we’re well on our, I won’t say well on our way but we are on our way to that.

Look at some of the other appointments that Trump has made as well. Just quickly here, you know, looking at Tulsi Gabbard being nominated to be the U.S. attorney General, or excuse me, Tulsi Gabbard is the Director of National Intelligence. It would be Matt Gates who’s been nominated to be U. S. Attorney General, you know, and there’s been so many of them, it’s almost tough to keep up with at this point. We still got to get them confirmed. But starting to like some of these picks coming in here.

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So let’s take a quick look here at what the, the Doge Agency will look like. The Department of Government Efficiency. What I think is so exciting about it, right. People are already making the joke that would be so easy to make is top of mind. I can’t believe that they’re trying to make the government more efficient by adding another agency. Right. But this isn’t just any new agency. This is an agency or whatever they’re going to call it, that has an end date.

Right. None of these other ones have prescribed end dates, at least not that I’ve ever heard of. But Trump has given Elon and Vivek until 7-4-26 to do this. So they have what, 500 something days until that point to get all of this done. And they’re already floating out some really fun ideas. So I’m not going to dive into them too much today. But again, this is exciting and the kind of moves that again, I think that people will look back on, on these moments as history was being made. I think that’s what’s going on right now and we’re going to continue into that.

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Kip and I talk about it very often here. Even before Trump was elected, we, we called and felt like we knew that it was going to be a roaring 2000s, right. We said that when our book was published in 2022, right in the throes of the Biden Harris administration. And that was our view then. So think about how much more excited we are about this now. This is going to be American exceptionalism unleashed right here. And the rest of the world has two options. You know, get start implementing some of these, these policies.

Here’s the playbook for how to do this right or get left behind and get left in the dust already we’ve seen the EU get left in the dust. I just saw a chart here today. I don’t have it in front of me, but essentially in like 2008, the EU and the U.S. and that might be cherry pick data after the U.S. had really, you know, gone through the 2008 financial crisis and kind of exported a lot of those problems as well to the rest of the world. But point being here, the EU and the US GDP were essentially neck and neck at the time. Since that point in the last 16 years, the US is now 50% larger than the entire European Union. And that happened in again, just the last 16 years.

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Think about that. Only four of those years were under Trump. And so we were doing that already under these policies that hindered our ability to grow. Now we’re going to get into a pro growth environment again, folks. I don’t think it can be understated that the excitement level here of what is to come. Roaring 2000s meets innovation revolution meets Trump economic miracle 2.0. So it’s going to be fun. Buckle up.

We’re going to be here every bit of the way, commenting on it. No video podcast today, but we’ll be back on video here pretty soon as well. So thank you for being here with us as always, looking to a little bit of our economic action on the day to day, you know, the first kind of big piece of economic news that they tried to turn our heads on from the Trump election. There’s just still so much excitement there that most of these other stories, like a Fed meeting last week, don’t seem to impact the market quite as much. We got CPI data which everyone said people were worried about, you know, coming in, headline as expected, but it was higher than the previous reading at 2.6% year over year versus 2.4% year over year from the previous month. But again, the headline coming in at 2/10 of 1% as expected, core CPI as well in line, 3%, 3.3% year over year. After the report came out, futures moved higher. We weren’t able to hang on to those gains and yields moved lower.

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But yields did rally back here today ended up finishing closer to its highs of the day, the 10 year up 4/10 of 1% at a 4.45. So yes, we’ve been watching this move in yields, but if you’re a regular listener here, you know that this doesn’t concern us. Yields at this level in our opinion is not enough to derail this market. And that includes at higher levels. Our tune remains unchanged in that regard. You know, we look, we’ve compared this period a lot to the 1996-2000.com melt up when the NASDAQ rallied 575%. Incredible. Gains.

Right. Most people like to focus on the blow up the dot bombs, but that was an incredible period for stocks. And during that time, yields averaged, and I don’t have the numbers in front of me again, but we’ve talked about it so much here, averaged about 6% during that time frame. So no, yields at roughly a 4.5% on the 10 year don’t bother us here. You know, even if they continue to head a little bit higher, that’s absolutely fine with us here. And we’ve got some interesting points to make on that. So, so stay tuned for the VRA Commodity Watch and we’ll talk about what happened during Trump’s first presidency. Right.

What kind of action? I’ll give you a little hint here. The dollar did, which has been rallying as well, initially rallied after Trump was elected and then after his inauguration fell drastically. Right. So we saw a similar deal, and I guess I’m spoiling a little bit of it here, but we saw a similar deal with yields as well. Yields went up a little bit after Trump’s presidency and by the end, not even by the end of his first term, they had fallen roughly 18% more than that. That’s, I’m eyeballing that chart there as well. So that’s the kind of action we do. You know, we’re kind of in a holding period.

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A lot of speculation about what his second term is going to look like. You know, we’ll find out more once we get to January 20th, once he’s inaugurated. So we’ve got some themes around that that we’re working on right now that we’ll bring to you here as well. So next up here tomorrow we get the Producers Price Index. So another look at inflation. The PPI expectations are for another 2, 10 of 1% increase on PPI and 3, 10 of 1% increase on core PPI. So we’ll see what we get there in the morning. You know, one other sidebar here that’s related to this topic is I just saw a chart today of what inflation has done in Argentina since Javier Malial was elected there.

Remember, he ran on a platform of eliminating bureaucracy. There’s that famous video of him where they’re saying, all right, what of this on this chart here? And it’s all Velcroed pieces on it on a, on a board. All right, which ones do you want to reform? What do you want to do with these different government organizations? He just rips the Velcro off one after another. Get rid of it, get rid of it. Get Rid of it. Right. And since that time he has successfully done a lot of that. And if you look at, I believe it was a quarter over quarter basis of inflation since he got into office.

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And it’s like every quarter inflation fell 5%. Like it started at 20. 20. Yeah, started at like 20. Then after 1 quarter was down to 16, then it was down to 13 and then it was down to 9 and then it was down to 5. It just boom. Beats after beats after beats. And I believe they’re back into somewhat of an acceptable range on inflation.

Probably still more work to be done. But hey, when it comes to managing a country, the work is never done, right? So as long as we can keep moving in the right direction, you know, that’s something we would love to see here in the US as well. And another reason why I’m so excited about this Doge commission here and just what a hilarious name as well. I can’t believe Trump let him go with that, you know. Yeah, we’re going to work hard. This is one thing I love about this environment is you’ve got all of these incredible people, Elon Tulsi, Gabbard, Vivek, rfk who work very hard but also have room for humor in there as well. You know, we’re meant to have fun out here, you know. Yes, we’re going to work hard and we’re going to have fun while we’re doing it.

[00:12:11]:
So this is exciting. Sorry I’ve been rambling about this a little bit today, but again, this has been one of those weeks where a decade’s worth of news has happened. All right, so that being said, let’s take a look at our market action on the day today. As I mentioned earlier out of the gate this morning we got we’re green really across the board. NASDAQ turned down first and we finished mixed on the day. Two out of our four major indexes positive on the day were led by the Dow Jones. And I will say as well, no all time highs today. But I mean what a run it’s been, right? So Dow Jones up 1/10 of 1% on the day today to 43,958.

And I’d like to point out here as well, remaining near a 52 week high is the transports up 910 of 1% today. That is good to see. Next up here was the S P 500 up 0.02% essentially flat on the day today to 5,985. After that the NASDAQ was down a quarter of 1% to 19, 230. And I’ll point out here as well, the semis continued to get hit here down 1.68%. You know, this is a group that we remain, we do remain long term bullish on. We’re running our charts regularly here that we look at for the VRA investing system and we do think that this is setting up for a great buying opportunity for the semis. And really the key point here is that this market continues to broaden.

[00:13:45]:
So yes, the semis haven’t been participating. Right. But the evidence is in the internals where we’re seeing broadening action from this. And one of them that I thought was interesting here today as well is the difference between software and hardware names. So the semis haven’t participated in this market rally. But so the question would be what is the rotation into rotation that Kip talked about yesterday? Right. These rotations that you see from sector to sector, kind of a rolling bull market. When one gets overbought, one of the unloved sectors can take over and that keeps our major indexes near or at all time highs while we work off those overbought conditions.

Right. So again, we look at that as a bullish phenomenon, certainly not bearish. But the answer is a rotation to the question of a rotation into what at least a bit of that has been software. The software sector, if you look at the software ETF, IGV is rallied over 16% in the last month, has been one of the biggest winners in the tech space. Holdings of, you know, companies like Salesforce, Microsoft, Oracle, other software, mostly software based firms out there. So what could be the next catalyst here? Because the software names might be a little bit overbought. Well, it could be Nvidia’s earnings which come out next week. They always report late in the quarter one of the last big names to go.

[00:15:19]:
So really after this week is through, all eyes will be on Nvidia which remains. It was down 1.3% on the day. Just right at still though an all time high. So that could be the next event, next big event that kind of gets the semis going from here. All right, next up here or sorry. Lastly, small caps which were leading earlier in the day did finish down just about 1% on the day today to 2,369 for the Russell 2000. Next up, the internals on the day today. Earlier in the session we were just about positive across the board.

Our one negative was the nasdaq. Unfortunately we finished closer to the lows of the day here for some of these internal indicators, but really overall a mixed day here. We did end up with more declining stocks than advancing stocks on both the NYSE and the Nasdaq. Just barely negative on the NYSE. Just shy though of 2 to 1. So not quite, but just shy of 2 to 1 negative on the NASDAQ today. 52 week highs and lows were our bright spot, coming in positive on both the NYSE and the Nasdaq. And lastly here volume did reverse to on the NYSE to finish negative on the day, was positive earlier in the session, but managed to come in positive here on the Nasdaq.

[00:16:42]:
Looking at our sectors on the day to day, we were led by Consumer Discretionary. We’ve seen that name at the top of the sectors list quite a bit lately. It finished just off of its all time high today. So didn’t get to an intraday all time high either. A big part of that though. Amazon up a big two and a half percent today, hitting an all time high after that. Energy names continue to perform well. This is one that Kip and I have talked about as well.

While we may not remain or we may not be extremely bullish on the price of oil, we do remain bullish on energy companies. But oil getting hit again a little bit today. Good to see energy finishing higher after that. Real estate and consumer staples. Our laggards on the day were communication services, tech and health care. Finally for today, our VRA commodity watch gold essentially flat on the day. Now it was down 1% earlier in the day to 2,572. So I talked about this a little bit earlier, but when Trump was elected in 2016, we saw a lot of the similar things that we’re seeing right now that reversed after the inauguration.

[00:17:54]:
So gold didn’t do a whole lot until January 20th. The dollar went up until January 20th and then over the next year moved lower in a big way. Similar with yields as well. Then you look at gold. So during Trump’s first year in office, gold was up 20, at least 27%. And again like I mentioned, the dollar was up between the election and inauguration. The dollar just consolidated from there really for the next couple of years, but in that first year moved lower in a big way. We started at 103 on the dollar index and moved down to an 89.

[00:18:34]:
So we’re looking for a similar move coming up in the dollar as well. Well, if you really, if you look at a chart of the dollar on USD, you’re looking at a chart that’s oh wow. On a one year chart, you’re looking at we’re almost at or at 52 week highs here. But then you zoom out a little bit and you see that the move really hasn’t been that big. As a matter of fact, this move higher has only been one third of the size of the move lower in Trump’s first year in office. That’s a big move, right? This is not a big move in our view. So no concerns here about the dollar. We do expect similar action in the first year of Trump’s presidency as well.

All right, so in in regards to gold, that does make us bullish. Still on gold, you know, we’ll look at this as a buy the dipped opportunity. Next up, silver down 1.1% to $30 and 40 cents an ounce. Copper down as well by 1.6% to $4 and 7 cents a pound. Oil remaining below $70 a barrel at $68 a barrel here. And finally for today, bitcoin a higher. Now, you know, obviously we peaked just what yesterday or excuse me, today at 93, 226. What incredible run this has been.

But now just below $90,000 of Bitcoin at $89,686 a 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@vralettr.com, click the podcast link at the top and we’d love to have you with us. Thanks again for tuning in. Until next time. We’ll see you back here tomorrow for the closet.