Value investor Davis on how investing is changing in the age of A.I.

Calamos' Freund: 'It's very hard to be pessimistic about the broad market'

Matt Freund, co-chief investment officer at Calamos Investments [https://Calamos.com], says a resilient economy is producing "shocking numbers for a mid-cycle economy," powering through problems in a way that puts the Federal Reserve on hold, avoiding interest rate hikes this year and returning to a bias towards cutting in 2027. Freund thinks that it's "back to the future" for the Fed, with new chairman Kevin Warsh bringing the central bank to where less information and guidance makes for more policy flexibility, even if it results in some additional volatility since the policy path will be less well-defined. Freund says the chances of recession in the next year are low, but that investors have to remain cognizant that "every mountain has two sides and, at some point, the string of good years can't go on forever." Meb Faber [https://mebfaber.com], chief executive and chief investment officer at Cambria Investments [https://cambriafunds.com], returns to the show a day after his Big Interview appearance to discuss his new book, "Investing in America: The Rise of a 250-Year Bull Market." He discusses what he expects the future to look like and why the bull market can continue almost indefinitely but why investors may not want to focus entirely on domestic investments in the future. Plus, Chuck answers a listener's question about the cheap, small-dollar life-insurance policies advertised regularly on television and whether seniors are better off going for the convenience of those policies or looking for other ways to protect their families.

Cambria's Faber: 'The bull market in diversification has begun'

Meb Faber [https://mebfaber.com], chief executive and chief investment officer at Cambria Investments [https://cambriafunds.com], says that large-cap domestic stocks have done so well that it has masked the rise of the rest of the investment ecosystem, but now that he expects recent good times to be balanced out by tougher stretches ahead for the Standard & Poor's 500, investors will want to take advantage of small-cap stocks, foreign stocks and more. That's good preparation for bear markets, and Faber makes it clear that downturns are a feature of the market, something that will come around again. Faber — who will return to Wednesday's show to discuss his new book, "Investing in America: The Rise of a 250-Year Bull Market" — says the trend remains "all signs green" for the market currently, but he says investors should be watching for change. Willie Delwiche, investment strategist at Hi Mount Research [https://himountresearch.substack.com], says that the best environment for the stock market isn't falling rates, but rather rates that aren't moving. That positions the stock market to be in a "boring" and "quiet" environment where it can keep riding technicals which Delwiche describes as being "in pretty good shape" right now, with all 11 sectors of the S&P 500 above their long-term moving averages and more stocks making new highs than are making new lows. Those patterns are creating "strength beneath the surface" that he says can power the market higher. David Miller, co-founder of Catalyst Mutual Funds [https://catalystmf.com] talks about insider buying as an indicator of corporate strength, monopoly and oligopoly positions as a way to play developing technologies and more in a wide-ranging Money Life Market Call.

S&P's Gruenwald: Expect a slow, steady economy with rates in 'a hawkish hold'

Paul Gruenwald, chief economist at S&P Global Ratings [https://spglobal.com], he expects that the Federal Reserve's next move on interest rates will be a cut, but says it won't happen until 2027, which he described as a one-year delay for the central bank to get back to more neutral levels. Gruenwald says it's a "hawkish hold," with the Fed being prepared to raise rates but hoping to hold off. Gruenwald says that effort is helped by the economy's resilience, driven by business investment and the wealth effect created by the market's return to record levels, which have put a floor on economic growth, allowing the economy to overcome a handful of economic and policy shocks — including the Iran War — in recent years. That's why he recently cut his expectations on recession, cutting the chance of an economic downturn from 33% down to 20%. Vijay [https://ijaymarolia.com] Marolia [https://vijaymarolia.com] spent the holiday weekend celebrating the holiday and more, and while he says his invitation to the Taylor Swift-Travis Kelce wedding extravaganza was lost in the mail, he isn't losing the chance to look at the wild spending on the party and to equate it to what more ordinary folks should do, namely learning how to size their spending so they can live well, while limiting financial regrets. Marolia, the chief investment officer at Regal Point Capital [https://regalpointcapital.com], also digs into Amazon and Tesla stock in "The Week That Is," noting that each company had something to celebrate that — when viewed under his five-lens approach to stock selection — will make investors want to have a party in their portfolio. Plus, Chuck answers a recent spate of questions about how the show itself works, and gives a behind-the-scenes look at guest selection, interview editing and more.

Franklin Templeton's Dover: This market's not 'expensive,' just 'fully valued'

Steven Dover [https://franklintempleton.com/profiles/stephen-dover], chief market strategist at Franklin Templeton [https://franklintempleton.com], says there is still more upside to the market, based on earnings growth, noting that the economy and stock market have been resilient due to the "phenomenal" profits companies have been generating. Dover notes that the market is fully valued, but not expensive; "We think earnings this next year could be [up] 15 to 20 percent, so the market could follow that without being more expensive." Dover, who is also the head of the Franklin Templeton Institute, notes that the earnings growth has been greatest among small caps, which is why he is leaning in that direction, and he advocates for fixed income as ballast for portfolios now; ;he had previously lightened up on the Magnificent Seven and other market leaders, and he says that the market has relaxed on those stocks, which may create targeted buying opportunities. Kevin Dreyer, co-chief investment officer for value at Gabelli Asset Management [https://Gabelli.com] — part of the team running Gabelli Equity Trust [https://gabelli.com/ticker/gab/] and other closed-end funds — discusses how he is finding value looking for names that are "differentiated and not highly correlated" to the stocks that have been leading the market's return to record levels. Specifically, Dreyer says he is looking for businesses that are "A.I. resilient" and able to withstand and/or benefit from the development of artificial intelligence. One area he cited as particularly attractive is sports and entertainment, because " You can't have an algorithm or chatbot replicate the New York Knicks … but you and I can go out and buy MSGS, which owns the Knicks." Plus, Todd Rosenbluth, head of research at VettaFi [https://vettafi.com], turns to a trending part of the market and makes an actively managed Fidelity small- and mid-cap fund his pick for "ETF of the Week."

Argent Trust's Stringfellow: Market is rounding out, not signalling big trouble ahead

Tom Stringfellow, chief investment strategist at Argent Trust [https://argentfinancial.com], says the stock market is going through a shift where small-cap companies are coming to the fore, businesses that are adjacent to artificial intelligence or that will benefit from using it are starting to get an A.I. boost and the warning signs feel mostly like distant storm clouds. Stringfellow says he doesn't see signs of recession, worries slightly about a market overheating if interest rates rise, but he thinks signs that more and more companies are showing earnings growth reducing a lot of potential downward pressure on the market. Ben Carlson, director of institutional asset management at Ritholtz Wealth Management [https://ritholtzwealth.com], discusses his new book, "Risk and Reward: How to handle market volatility and build long-term wealth [https://awealthofcommonsense.com]," and how he thinks investors can't simply tune everything out -- even if that might be the best long-term results -- because they have a "firehose of information" in their pockets. He discusses how to best filter that information to make it useful without becoming overwhelming. Meredith Mangan, senior editor at Credible [https://credible.com], discusses the site's survey on prediction markets, which showed that 1 in 4 Americans already have made a wager on a prediction-market site [https://credible.com/personal-finance/prediction-market-statistics]. In a wide-ranging study looking at investor habits, she noted that more than 60% of Americans see prediction markets as betting, while just under 30% see them as a viable financial tool.