Charles Schwab, IBM, Paul Karen discussed on Bloomberg Surveillance
S and stocks this morning opening higher the S and P 500 up half percent or 16 points at 34 36. DowJones industrial average of 4/10 Percent, or 110 points in 28,413 and the NASDAQ's up 7/10 percent or 81 points at 11,445. 10 Year treasury of 5 30 seconds. He'll 300.76% yield on the two year 20.14% 9. Next crude oil's up 2.6% of a dollar three at $40.98 a barrel go makes gold up 6/10 Percent, or $11.30 at 1902 10 Announce the euro 1.1743 against the dollar, the yen 105.926 Tom and Paul Karen, thank you so much. There are days where you go. Finally. And the patients that is required for equity investment. Maybe comes into play IBM justice one example. People waiting and Paul my right on that way too young and waiting and waiting for IBM to reorganize and go after Amazon and a ws cloud and, you know, I don't know as much about it is an Iraq is interact. Joining us, Paul I don't know. I think he's controls the next hour. Raising your next. See they wake up. They doesn't want to talk to me. Rather talk funny, miss part of them exactly. Actually, I'd like to talk to Bonnie quit Anyways. We're 1 31 on IBM up $7 a swell Listen. Saunders has seen all this. She's a Charles Schwab. She's a chief investment strategist. And she's been preaching constructively patients for years where there's like reorg in combinations and things get done. But you gotta wait to get it. You can't guess. Two mated. Over three weeks or four weeks. Listen and this news cacophony worrying right now. How dowe I maintain a Schwab like patients. It is tough because we're just bombarded with it every day. And you know, some of the headlines can be market moving, particularly on interday basis. We've certainly seen that with regard to Stimulus. I'm not suggesting that is noise. You just I just don't think you could trade around it. What I find interesting is that the cohort that has been most active and most dominant terms of driving Mo mentum and Driving sentiment, the women's day traders trafficking in the options market. I'm not sure they're doing it for the Liu's related items. I think they're just pressing the same momentum bets and we're seeing it again recently with the decline in the call ratio, but we're not seeing it across the spectrum. Of investors. You're not seeing it in attitudinal surveys like a I. I actually think there's also an age component that's at play here in terms of where the speculative froth is. And where the skepticism is there isn't expanding process is on the younger end of this. I'm shocked. I know, but so listen how much of this is retail? This Robin Hood is a function of maybe the pandemic and being locked in and there wasn't sports for a long time. Lot of people are suggesting that you know this stock market trading is This kind of an offshoot, a little bit of the pandemic and being locked in. Is that something you see yours or something more fundamental. No, I think that that's part of it. Let's hope that this is something more fundamental, long term because I think that there was this Perception, certainly throughout the entire last bull market cycle phone natural crisis that the market was never going to attract the attention of younger investors that they were going to sort of poo investing in Wall Street. So way, maybe seeing speculative frost here. But if this is the first step to get a younger generation interested investing for the long term I think that may be a silver lining that comes out of some of the risk associated with their speculative fervour. But I do think it is tied. You listen to interviews with some of these folks, and they do say it's a function of lack of sports, betting. It's the Gamification to some degree of trading. It is being home and not having To be a boss looking over your shoulder and time on your hands, So those factors have all come into play. So Liz and I are so we're less than four weeks away from the election. The news Is just going to be coming fast and furious between now and election Day. What do you suggesting to your Charles Schwab clients? How they play that or not play that? Well, don't play, and I never actually used the word play because I don't think investing in the game. I think investing should be a fun process over time, and never, ever about gambling on a moment in time, and I think tried trying to trace the election. Certainly, if you're if you're thinking and although nothing terms, you know, get out before the election and get back in after That's just not a winning strategy. I just heard about this. On Monday, we'll in history back to 1900 of presidential elections of combinations in Congress. Um and what it means for stock market performance, And there's really not much there. There where there is a relationship is more in the opposite direction of what people think. I think what goes on in the market. The economy impact elections more than the other way around. And I actually think the person in the White House in terms of the stock market may be slightly less important than the person sitting at the Federal Reserve. All right. So listen. Fiscal stimulus. It doesn't appear that we're going to get anything in the near term. How does that factor in to your catalyst? What do you suggesting to your clients? They think about when I think about fiscal stimulus. You know the analogy have been using is that we all sort of got in a car ride on our way to sort of Helen. We're happily back, but we're not all the way back and we're running out of gas, and I think the fiscal similar represents some of that gas. I think maybe the hope expressed him with the market's doing is that Maybe we get something in a piecemeal basis. But it's hard to envision a scenario where absent some additional fiscal relief, especially given what we're seeing with permanent job losses, relatively temporary job losses and long term unemployment. We don't struggle in the economy without some additional fiscal relief. Listen, What are you seeing in terms of people's mood? I mean, I've brought this up with your time and time again. You have a radar. It's Schwab of what people are actually doing. Not talking about. What are they doing? Well, it goes back to the company and made about maybe demographics being a factor in diverging sentiment conditions and I would say our investors, they're still there's definitely more concern expressed in questions than there is. Of opportunism on DH, and they can't be big macro concerns, not specific market concerns. Obviously the election Is a big topic of question. The number one question continues to be. Is there a disconnect between what's going on in the stock market? The economy and if so, worry debt and deficit questions are always popular. So in an environment in Washington, where Now there's bipartisan support for kicking the can down the road. I would say our investors still have that near the top of the list of longer term concerns. So listen, there's been a little bit of a push pull in the marketplace. It seems like between those folks that are saying, Hey, let's stick with these big tech names that have proven top line growth stories. That are going to work. No matter what's going on the world versus those that are saying, Hey, I'm willing to look past this pandemic to the other side where I think I'm going to get some economic improvement and therefore maybe it's time to rotate its more cyclical sectors. Where do you and Charles Schwab come out in that discussion? I would say we come out sort of in the middle. I think you need to be really mindful of paring back gains in those high momentum names. I don't see quite the extremes. Of where we were in 2000. Yes, the largest five stocks represented at the recent Pete 25% of the S and P versus only 18% in 2000, but the average E of the top five stocks today. Is and I put on Lian only 32..