Charlie Bilello is back to talk markets, markets, markets. Charlie’s a veteran of the show. I like to catch up on the markets once a quarter, but I could talk about the markets all day, every day. And we love having Charlie on because he’s always prepared. We discuss zero percent rates and why the Fed is buying mortgages, the stealth bear market, and the delta wave impact on micro trends. So, come fly the friendly investing skies with Charlie and I.

You can listen to the podcast here on Spotify or Apple and now all the episodes are on my YouTube channel as well.

For more details on today’s conversation read on below…

Guest: Charlie Bilello

Profile: Founder and CEO of Compound Capital Advisors

Where to Find Him: Twitter

What’s Charlie Panicked About?: Figuring out the settings on his new microphone.

The Takeaway:

We can see inflation isn’t proving to be nearly as transitory as we were promised. Looking back, if we knew nothing else, what’s going on in the housing market – with house prices up 20 percent – the highest rate of increase we’ve ever seen in a one-year period, and every single major metro area up double digits; along with unemployment at 5.2 percent, job openings exceeding the number of unemployed by a few million – you’d expect interest rates to go up.  None of this makes any sense given what’s going on other than the Fed needs to keep rates low because of the debt markets. They’re afraid of what might happen if they normalize. Meanwhile, many stocks have had great run-ups, but some have come off, and a drawdown is a drawdown. There’s a stealth bear market, a change in the market environment where investors’ kept moving higher and higher up on the risk spectrum. But people need to realize just because you take more and more risk doesn’t mean you’re necessarily going to be rewarded for it. By the end of June, we were feeling pretty good with COVID in terms of cases, hospitalizations, and deaths in the US. We were at all pandemic lows. Then came the delta wave impact. First in the UK and Israel. It was maybe three times more contagious. We saw a bit of a pullback, even commodities came down briefly; anything related to the reopening trend took a hit. And it all happened so quickly. But remember, there’s a million ways to get to 10 percent a year. Sometimes you can get there by risking 1 percent of your 100 percent three days a year if you wait patiently enough. Other times you have to invest 110 percent of capital and leave it invested to get that 10 percent, but there’s more than one way to do it.

Previously on…

In May, Charlie came by to talk research, portfolio management, product development, content creation, investor relationships and more for Episode 152 of Panic with Friends. And we had him on way back in March of 2020 for Episode 2, just as COVID started to heat up.