In today's episode, Tyler breaks down another day of all-time highs to close out an excellent week for our major indexes. He kicks things off by highlighting the incredible momentum driving the current market rally, emphasizing the role of the ongoing “innovation revolution” that’s fueling growth. From big-picture economic trends to actionable insights in commodities, today’s episode is packed with the latest news. Tune in to today's podcast to learn more.

Don’t look back because the market is closed. Good Friday afternoon, everyone. Tyler Herriage here with you for today’s VRA Investing podcast. Hope you had a fantastic Friday out there today, a fantastic end to your week this week. If you’re watching the markets today, you probably had a pretty good end to the week as our major indexes as far as the Dow, Nasdaq and the S&P 500 finished out the week at all time highs. And for some of these, making backto back weeks of all time highs here. So great to see. We’ve got a great podcast here for you today.

Of course, leading with the all time highs is fantastic and as we always say, new highs beget new new highs. But we also saw some major headlines coming in one just before the close here, some after the close that we might get to here if we’ve got time today. But you know, more examples of the innovation revolution that is driving the roaring 2020s that we’ve called for here for so long now since Kip and I wrote the big bribe in 2022 just before the October bare market lows from that year. So excited to touch on the innovation revolution as always. That’s got to be the one of the most exciting themes out there right now from multiple angles as well. You know, that’s not just technological or, you know, a lot of people think of tech, they think, you know, digital or things like that. Right. It’s so far beyond that.

[00:01:43]:
It applies to the energy sector, it applies to, to home builders in some ways. It really across the board you could probably name just about any sector and you could find an example of innovation taking place there right now. And speaking of which, I will get to our home builders today after Lennar did miss on earnings this morning. So we’ll cover that here in a minute and we’ll see. You know, what do you think? Is this a warning sign for housing or potentially an opportunity? We’ll cover all that and more for the housing sector as well and, well, a lot more to cover here today. I was going to say the gold miners. We’ll get to that later on in the podcast. But wow, just what a move they have been on.

This is the move we’ve been talking about here really for a long time here on the VRA Investing podcast and now we’re watching it play out. So I’ve got some great charts to share on that as well. So let’s jump right in. A quick heads up though, if you were tuned in to the Schwab Network Today you’re probably wondering where I was. I got moved at the last second there to Monday show at the same time, 2:30pm Eastern time. So hope you can join us on Monday again. We’ll try again for the Schwab network. But I’m looking forward to being on there.

[00:03:06]:
And, and you know, I was kind of thinking about this as I was watching the Schwab network today throughout the day because I don’t watch a ton of tv. Kip’s talked about this as well. We usually leave, you know, one of the financial networks on in the background just for breaking news or a good interview. And I have to say lately I have found myself leaving it on the Schwab network more and more because just what a fantastic job, you know, that they’ve done for financial news. The anchors are great, the guests that they get are great, thoughtful, fact based, you know, don’t agree with them on everything. Right? But at least we’re talking about financial news, right? Where you know, even some of the best, if you want to call them that, of the mainstream. You know, a lot of it gets so political even when we’re talking about financial topics, when you’re talking about stocks, the, they overlap it with, with, with political commentary so often. So it really is kind of refreshing to get that take from Charles Schwab network and or swab Schwab network and you know, really see what the experts in this fa, in this space are talking about again, some great guests that they’ve gotten on there.

[00:04:19]:
So I’m looking forward to being on again again. That’s Monday at 2:30pm Eastern Eastern Time. So hope that you can join us then. All right, so let’s start jumping in here. A couple of the headlines. One that broke just before the close today came out another big deal for Oracle here. Austin based company now with a 20 billion dollar AI cloud computing deal with Meta this time, which Mark Zuckerberg was just out with an interview. I didn’t watch the whole thing but essentially, you know, it’s, it’s a, it’s a race right now the AI race is on and Zuckerberg seems to think that you can spend your way to the top and certainly may be possible.

But I think the quote was something along the lines of, you know, they’re, they’re willing to lose not just billions of dollars but hundreds of billions of dollars to get to that top spot. So we’ll see what we can do. I actually, you know what a pivot that Mark Zuckerberg has made from the Robot like figure that, that he was in the past to trying to relate to people a little bit more. At first it seemed a little bit disingenuous, but, you know, somebody made a great point about kind of the glitch that they had. I haven’t even watched that video, to be totally honest. Don’t rec. We don’t own Meta here, so I don’t follow it super closely. I don’t use the platform or anything like that.

[00:05:47]:
But apparently there was a hiccup in one of their tech demonstrations. But it’s actually gotten a lot of love because it’s, it’s authentic, right? You’re never going to see Tim Cook really demoing hard Apple hardware in front of an audience, right? Tim Cook is not Steve Jobs. Steve Jobs loved giving a great presentation. There were still glitches in there sometimes as well. But, you know, Tim Cook’s all buttoned up and, you know, he’s a good steward of Apple, right. He’s done a good job for the company. I’m not trying to take away from what he’s done there, but he’s not the innovator. He’s not going to take Apple to the next level.

Right. When really the innovations that they’ve come out with have kind of been incremental. I would love to see Apple come up with something I loved growing up. I remember the first time I watched one of those Steve Job keynote speeches and just being mesmerized by it. Not only the way that he spoke, but of course, the technology and the foresight of what he saw coming at the time, you know, that was impactful. So, you know, again, not a shot at Tim Cook here, but that’s not who he is. I think he knows that. And that’s, you know, part of the reason why he has probably done such a great job at Apple is he focuses on, you know, let’s bring down costs on producing these things and other areas in Apple’s business where they can, you know, drive growth to the bottom line.

[00:07:13]:
So point being here though, for this Oracle and Meta News is really the data center story, which a lot of people talk about here. But as of right now, I mean, it’s getting incredible. The value of data centers under construction right now is up 400% since 2022, since the chat GPT moment when that came out and everyone was racing to, to get AI right, to get to, to forward their AI. And on top of that kind of back to my innovation revolution point from earlier, that innovation is not just AI, it’s not just what we think about traditionally as tech, but it is energy. Because data center energy consumption has reached a record 5% of total U.S. power demand. That’s a big number there. By 2030, just four years from now, data center energy consumption will exceed 10% of total U.S.

[00:08:17]:
power demand. That’s an incredible number. And a lot of people have compared this to, you know, office space. But I think office space, you know, that’s been downsized on so many different levels. Whether they’re laying off people for because of AI or you know, know, working from home still is a big deal. But on the energy side of things, it’s exactly why we own companies. And another innovation revolution story here, the energy technological innovation revolution. Companies like NuScale Power, it’s what we’ve talked about here a lot, SMR for their small modular reactors, which are an excellent idea because there’s a whole lot of people out there, myself included, that doesn’t want to live next to one of these giant monstrosities of a nuclear power center.

Not even saying that they’re bad or unsafe or anything like that, but you know, they cost billions of dollars. A lot of that cost ends up on the city or on the state. And they’re all one off projects, right? It’s one company building and each one’s unique in some way. If you can make this again for SMRs, more of a manufactured real roll it off the line and let people plug into it and get power. And the great thing about companies like new scale power is that they can be linked together as well, you know, so you roll them off, they’re all the same, manufactured in the same place, got parts ready to go. Not custom parts for every single, you know, oh, the one in Texas needs this parts, the one in New York needs these parts, the one in California needs these parts. Right? No, they can make it all at once. An assembly line sty style of model for nuclear reactors.

[00:10:00]:
That’s pretty incredible there. And there are other companies working on it, but you see how good of a fit that would be for data centers that if, all right, the company needs power to their data centers, have an SMR put in and if they don’t use all the energy then sell it back into the grid. Could be a win win here. You could see that. Absolutely. And what some of these companies have done. Well, I won’t get too far into it today. We only have so much time.

But of course we still love oil and gas as well. Not just us being Texans, we really do love oil and gas. You know, it’s why we have our Lost Soldier project that we work so much on. And I know many of you are a part of as well, which is also going to be critical to our energy infrastructure here in the US These are projects that we want to be a part of and innovative in their own right as well. So a lot of exciting stuff, a lot of moving pieces going on in this market right now in a lot of exciting ways. And of course that leads to all time highs. So let’s take a quick look here at our markets on the day to day. As I mentioned earlier, we did have three out of our four major indexes finish higher on the day.

[00:11:12]:
Just about right at their highs of the day as well. Are finishing just about at their highs of the day as well. We had the NASDAQ leading the way here. Well, quickly, you know, interesting day and exactly what you want to see is finishing at the highs of the day. After this morning, you know, open looked all right. We saw a sell off into the morning and then by the afternoon we were back to the highs of the day. Markets just didn’t look back from there. Again, exactly what you want to see.

So NASDAQ back to back week weeks here of all time highs up 7/10 of 1% today to 22,631. And I want to point this out really quickly here because after back to back weeks of all time highs, you would think, and I mean multiple all time highs that we have hit lately, this really parabolic move higher. Take a look at this. The fear and greed index still at a 62, not even to extreme greed levels yet. That’s how unloved that this market has been. And that means that there’s a whole lot of money on the sidelines or underexposed to this market. We think that adds fuel to the fire as we move forward. I talked about this yesterday.

[00:12:29]:
The AII from last week again, I had to reference in it again because it’s just that’s a big move higher in bulls there. We still have more bears than bulls. Pretty incredible. And you can see how we got even just a little bit of a shakeout that’s going right back to way more bears than bulls. The fear and greed is going to go at least back to neutral on something like that. But our view remains unchanged. It absolutely would be a buying opportunity. We just have seven trading days left in the month of September before we get into the seasonally best quarter of the year.

And again, I mean it doesn’t mean we’re out of the woods yet from this seasonally weak period, this last, you know, from what two days ago, the last 10 days trading days of Q3 is one of the weakest times of the year for the market. Obviously hasn’t been the case this year. So again but we’re not out of the woods yet, but we would look at it as a buying opportunity. Absolutely. All right, next up here for our major indexes was the S&P 500 up just about half of 1% to 6664. Next up the Dow Jones up just under 410 of 1% to 4635. And lastly here, small caps pulling back a little bit from those all time highs that we got yesterday. Russell 2,000 down you know, three quarters of 1% to 2,448.

[00:14:04]:
And I do have a chart here for you of IWM which is the Russell 2000 ETF. Take a look at this chart here. May I zoom in a little bit for you? There we go. All right. So going back 10 years here, the previous top looks a little bit familiar, doesn’t it? What we talk about here often is that previous resistance becomes future support. So that’s why this line is drawn a little bit longer here. We had the double top obviously Covid right. Nothing you do about that.

But once it got back to those levels, off to the races and that future resistance level served as support, we think we’re going to see something pretty similar here. You know the three, the third being a breakout is a, is a very good signal. Okay. Now nothing is 100% perfect in technical analysis like this, but this is a good indicator here and that’s actually a little bit above that. But regardless, I think that’s what we’re looking at here, that these levels will become future support after small caps do continue their move higher from here. You know, it’s absolutely been our view that now we’ve gotten back to a point of we have a pro growth administration. We have the Fed now cutting rates which small caps benefit the most from. You know, the market.

[00:15:29]:
When you cut rates within 1% of an all time high to 12 months later, markets are higher 100% of the time with average gains of 15%. But also, excuse me, when the Fed is cutting rates, small caps historically have outperformed large caps by 5 to 7% percent over the next six months. You know, we could be looking at a very similar move here. And it’s time, you know, small caps have been unloved for a long time. We would love to see them get rocking here and just more evidence of the strength of the U S economy because these are you mostly U S based companies here. So exactly what we want to see on the road to 5% GDP. We talked about the GDP numbers yesterday here on the podcast that are surprising a lot of people. We think that’s going to continue.

All right here, let’s take a look at our internals on the day to day for the market. Not what you I expect yesterday we got good numbers today. You know I mentioned that after the open we got a little bit of a sell off and the internals never really were able to recover. So we came in, you know, just better than 2 to 1 negative but just barely on the NYSE. A little bit better than that on the NASDAQ though. 52 week highs and lows did come in positive for both. A little bit of a lagging indicator, but that’s all right. And then lastly volume did come in negative for the NYSE but positive on the Nasdaq.

[00:17:00]:
So mixed day here from our internals. You know we’ll look to see on Monday if this is, you know, part of a little bit of a shakeout possibly. I wouldn’t even say that. We’ll continue to watch the internals closely here though. Again not the internals you want to see on a day or where three out of our four major indexes finish higher and hit all time highs. But again not bad, not the worst that we could possibly see. All right, next up here, let’s take a look at our sectors on the day to day where we saw more alltime highs. Quick refresh.

We finished with 7 out of our 11 sectors higher on the daytoday. Tech once again leading the way. Exactly what you want to see from this market. And again XLK, the S&P 500 tech sector hitting an all time high. Semis did finish slightly lower on the day to day. You know we’re at extreme overbought readings. It happens. But again what a move higher it has been for the semis as well.

[00:18:07]:
Next up, utilities continue to move higher in light of despite the 10 year yield up again on the day at a 4.13. Nothing worth writing home about. I think this is a, you know just a short counter trend move before. Yields do continue moving lower after that. Communication services which did hit an all time high today followed by consumer discretionary materials and then financials. All time closing high. Not quite an all time high today though. And industrials higher on the day.

Our laggards energy and Then real estate which we talk about this year often. We don’t follow the real estate sector as far as S P goes, we like the home builders. The real estate sector is mostly made up of REITs. This chart is getting very attractive here. It’s been on a good run. This looks like a normal pullback here and a buying opportunity. You know we’re looking for a position here, but was after Lennar posted a double miss today on earnings. So home builders were hit a little bit hard again though.

[00:19:11]:
What do you think? Let us know. Email us about what your opinions are on the home builders at these levels because starting to look pretty attractive here. All right, our other laggards for our sectors on the day, consumer staples and healthcare. Finally here for today, our VRA Commodity Watch. Gold back above 2700 an ounce last time I saw. Let me get a refresh of these as well. Oh, 3705. So yes, still above 3, 700 an ounce.

Excuse me. Just about $40 away from its all time high. And this was an interesting stat that I saw today that I hadn’t seen before. In 1980 when gold peaked, gold equaled 9.9% of US disposable income per capita. Today that’s only 5.6%. So to match that historical peak from 1980, gold would need to rise to roughly $6,600 an ounce. $6,600 an ounce. We’re still looking for $4,000 an ounce by year end.

[00:20:23]:
You’ve heard kips in our new target. $15,000 an ounce by 2032 for gold. And what does that mean for the gold miners though? Right? Because in that environment as we talk about you often, you want to see the miners leading the metal just like you want to see semis leading tech. Well, GDX all time high today up a massive 5.19% on the day to day. And check out this chart here. GDX to gold GDP just absolutely gone parabolic here. Incredible move. You know we are at extreme overbought readings here.

Doesn’t mean that this is has to be a top but this is the time, you know where we’ll pause our buys and wait for a pullback for a better buying opportunity. But this is a group we absolutely want to remain in here. We remain incredibly bullish on both gold and silver and of course the miners. But silver on also having a good day today. Up 2% to $42.95 an ounce. Just below or sorry, that is a 52E high today. Now approaching its all time high from Was that about 2011 or so? About $56 an ounce away from those levels. And historically the gold to silver ratio is also at low levels.

[00:21:45]:
So you know, silver could play some catch up here, here. Next up, copper up 610 of 1% today to $462 a pound. Oil down 1.4% to $62.68 a barrel. And finally here for today, bitcoin continuing its sideways moves here from what we’ve seen recently, you know at 115,000 was high as 117,000 earlier in the session. I talked about this yesterday as well, just below those all time highs at 124,000. Another group here we do remain extremely bullish on is 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@ vraletter.com, click the podcast link at the top and we’d love to have you with us until next time. Hope you have a great weekend out there. Hope you have a great rest of your Friday as well. And I’ll see you back here on Monday for the close.