October 18, 2024
By Steve Blumenthal
“When you’re easing into a meltup in financial markets, and we have the fiscal policy we have going forward, it’s certainly a risk. And I just think it’s a mistake not to be taking that risk into account.”
— Stanley Drunkenmiller, Bloomberg Interview October 16, 2024
One of the things I love about my job is the “Shark Tank” element—the energy of exploring and evaluating ideas. This week, I spent two days in Dana Point, CA, attending investment presentations, then headed to Denver for two days at a private equity conference. Alongside the presentations were experts’ insights on energy, real estate, and the broader investment landscape. I’ll need more time to gather my thoughts, and I will share my high-level takeaways with you next week.
My day started with a 6:45 a.m. flight from Denver to Philadelphia. The sunrise was incredible—everything glowing orange. Once we climbed above the clouds, I crossed my fingers and opened my laptop—luckily, the Wi-Fi worked.
The U.S. stock market continues its climb, reaching new highs again this week. Investor optimism has swung back to bullish extremes, which is usually a signal for traders to be cautious. For long-term investors, though, it’s wise to keep an eye on valuations. One of my favorites hit an all-time high this week.
Now, let’s dive in. We’ll examine two key valuation measures, share some sharp commentary on the state of the economy, and wrap up today’s post with a thoughtful discussion I had with David Magerman and Nick Adams from Differential Ventures on AI.
AI is still in its early stages, much like the internet was in the mid-to-late 1990s. It’s a huge game changer with the potential to reshape everything. But like the dot-com companies of 25 years ago, some will win big, and some won’t make it. Remember when apps were barely a thing? Now, they dominate our desktops and phones.
Valuation Record High
Investing is about risk and reward, and since investors’ exposure to U.S. stock equities is near record levels, there is no better tell in forward return potential than the value you pay for an asset.
Whether you consider him a Perma bear or not, John Hussman is smart. I make it a point to read his monthly posts and scroll to his 12-year Forward Return outlook, to which I ascribe great value.
On October 14, 2024, the U.S. equity market reached the most extreme level of overvaluation dating back to 1925—higher than 1929, 2000, and 2022. Hussman believes his MarketCap to GVA (Gross Value Added) ratio is the best measure he has found that correlates with actual, subsequent 10-12-year returns across a century of market cycles.
Hard not to heed the warning. Consider stop-loss orders or hedges with put options.
Next is another of my favorite valuation and forward return forecast charts courtesy of Ned Davis Research. It looks at the Stock Market Cap as a Percentage of Gross Domestic Income. To understand how overvalued the market is by this measurement, focus on the blue line in the lower section of the chart. Anything above the dotted top line is the top 20% of overvalued readings dating back to 1925. Since the 1940s, only 2000 and 2021-22 had higher readings. Next, look at the data box at the very bottom. It shows the subsequent 1-, 3-, 5-, 7-, 9-, and 11-year annualized returns when above the upper dotted line (the current state) and below the bottom dotted line (the “We’d be better off here” state).
Source: Ned Davis Research
The State of the Economy
A must-read for me every day is Peter Boockvar’s Boock report. I have no idea where he finds the time to listen to all the corporate conference calls, but he does. Then, two to three times daily, his research letter hits my inbox. And without fail, he’s always available to answer my call. My best guess is that he is either a human AI bot, has a twin, or is not human. His research is on point. You can follow him on X or subscribe to his Boock Report here.
Peter wrote this week, “From all the data and earnings information and color I continue to see, notwithstanding the headline GDP prints and expectations for Q3, the US economy is being held on his shoulders by a tremendous amount of government spending and legislative incentives, anything related to AI spend and higher income consumer spending on leisure/hospitality/travel. Everything else is seeing little to no growth.”
His comments above pretty much sum it up, but if you are interested in more granular details, I will share more from Peter below, with his permission. Eyes, ears, and boots on the ground. A must-read.
Grab a coffee and find your favorite chair. I hope you enjoy the AI discussion as much as I did. We’ve got to understand the enormity of its potential.
On My Radar:
- Artificial Intelligence “AI”
- Boockvar – Boots on the Ground
- Junk Bonds Update II
- Personal Note: Game Day, Again
See Important Disclosures at the bottom of this page. Reminder: This is not a recommendation to buy or sell any security. My views may change at any time. The information is for discussion purposes only.
If you like what you are reading, you can subscribe for free.
Artificial Intelligence “AI” – Magerman, Adams, Blumenthal and Hee
I recently hosted a podcast discussion with David Magerman and Nick Adams from Differential Ventures, an early-stage venture capital fund that focuses on investments in artificial intelligence.
Why you may want to listen:
David Magerman is a co-founder and managing partner at Differential Ventures.
Previously, he spent the entirety of his career at Renaissance Technologies, which is widely recognized as the best quantitative hedge fund management company in the world. He helped found the equities trading group at Renaissance, joining it in its earliest days and playing a lead role in designing and building the trading, simulation, and estimation software. On an extended garden leave from quantitative finance, he wants to use his data science, software development, and statistical modeling expertise to help Israeli startups succeed in the global marketplace.
David holds a PhD in Computer Science from Stanford University, where his thesis on Natural Language Parsing as Statistical Pattern Recognition was an early and successful attempt to use large-scale data to produce fully automated syntactic analysis of text. David also earned a Bachelor of Arts in Mathematics and a Bachelor of Science in Computer Sciences and Information from the University of Pennsylvania. Source: Crunchbase
The Medallion fund is considered one of the most successful hedge funds ever. From 1994 through mid-2014, it averaged a 71.8% annual return before fees.[33] The fund has been closed to outside investors since 1993[34] and is available only to current and past employees and their families. The firm bought out the last investor in the Medallion fund in 2005 and the investor community has not seen its returns since then.[10] About 100 of Renaissance’s some 275 employees are “qualified purchasers”, meaning they generally have at least $5 million in assets to invest. The remaining are “accredited investors”, generally worth at least $1 million.[33] Source: Wikipedia
Nick Adams is a co-founder and Managing Partner at Differential Ventures.
Previously, Nick was a Venture Partner at Supernode.vc, f.k.a. Flatiron Investors, where he evaluated seed-stage tech companies and led the due diligence for multiple investments. Before joining the venture capital community, Nick held senior sales, marketing and product management roles for software companies that have realized over $1.3 billion in exit value, including: Opower (IPO), RAGE Frameworks (acquired by Genpact), Basware (Publicly-traded on OMX), and Comverge (acquired by Itron).
Click on the photo to watch or listen to the replay. I hope you enjoy the discussion as much as I did.
Source: CMG
Click here to listen on Spotify.
Source: CMG
Please know that CMG clients are invested in the Differential VC funds. This discussion is not a recommendation to buy or sell any security. It is intended to help educate you on the AI investment space. See additional disclosures in this post.
Boockvar – Boots on the Ground
SB Here: If you read the intro section, Peter’s quote summarized his overall view. Following will give you a feel for the depth of the time he spends listening in on corporate earnings and investor calls.
From Peter:
From all the data and earnings information and color I continue to see, notwithstanding the headline GDP prints and expectations for Q3, the US economy is being held on his shoulders by a tremendous amount of government spending and legislative incentives, anything related to AI spend and higher income consumer spending on leisure/hospitality/travel. Everything else is seeing little to no growth. And just read below some of the earnings related comments I gleaned and I think it helps to point to that conclusion, again.
We can easily point to the Taiwan Semi numbers for the reason for the pre market lift in the futures as both the quarter and the guidance exceeded expectations. They said the 12.8% sequential revenue growth “was supported by strong smartphone and AI related demand for our industry leading 3 nanometer and 5 nanometer technologies.”
“We continue to observe extremely robust AI related demand from our customers throughout the 2nd half of 2024.”
They also raised their cap ex estimates “As the strong structural AI related demand continues, we continue to invest to support our customers growth.”
Answering a question on the trend in AI investments, its sustainability and the broad market questions about the returns on this massive buildout the CEO said, “Let me answer your question. Simply, whether this AI demand is real or not, okay, and my judgement is real…And why I say it’s real? Because we have our real experience. We are using the AI and machine learning in our fab and R&D operations. By using AI, we are able to create more value by driving greater productivity, efficiency, speed, qualities.”
From Synchrony, the private label credit card focused finance company whose stock popped yesterday but these comments don’t read so well:
“Both new accounts and purchase volume growth continued to be impacted by a modest pullback in consumer spending, as well as the credit actions that Synchrony has taken since the middle of 2023 to reinforce the credit trajectory of our portfolio in 2024 and beyond.”
“Customers continue to be selective in how and where they spend, particularly as they manage their spend to navigate the effects of inflation on needs like groceries, utilities and rent. Platform purchase volume growth ranged between down 3% and down 7% y/o/y, generally reflecting lower spend per account as customers moderated both bigger ticket and discretionary spend, particularly in categories like furniture, electronics, cosmetic and vision, as well as the impact of Synchrony’s credit actions.”
Also of note, “Receivables growth across the platforms range from 3% to 10% higher vs last year, primarily driven by payment rate moderation.”
Further, “our customers across credit grades are spending less per transaction in most categories, with average transaction values declining 3% vs last year. More specifically, our non-prime customers reduced their average transaction values by about 5% vs last year, while prime transaction values moderated by 3%. Our super-prime customers continue to drive more out of partner spend, the transaction value declines of around 2% y/o/y.”
On credit quality, 30 day plus, 90 day plus and net charge offs all rose y/o/y though the rate of increases has decelerated because of tighter lending standards.
From Discovery Financial, another credit card issuer:
“Discover’s financial performance remained strong in the 3rd quarter, benefiting from increased net interest margin, modest loan growth, and some credit improvement.”
On credit quality, “The total net charge-off rate was 4.86% was up 134 bps from the prior year period and up 3 bps from the prior quarter reflecting continued seasoning of recent vintages and the student loan accounting classification change.” Credit card charge-offs rose 125 bps y/o/y to 5.28% but down 27 bps q/o/q. The 30+ day delinquency rate for credit cards were higher both y/o/y and q/o/q and the same for personal loans.
Their conference call is this morning.
From CSX:
They referred to the economic backdrop as “mixed.” “As a whole, merchandise continues to be a great contributor for us…supported by new business wins, truck conversions, and the ramp up of industrial development projects.” They saw a pick up in chemical deliveries as well as for forest products and cement with the latter “supported by construction demand and the ramp up of new customer facilities.”
On the other hand, “Other markets we serve are facing more near term challenges. As we’ve highlighted through much of the year, the metals market, particularly steel, remains soft, with sluggish demand, ample supply, and low commodity prices. One reason for softer metals demand is a weaker than anticipated automotive market, where conditions have deteriorated.” I bolded for emphasis because of the importance of the auto sector to the US economy and I heard weakness about autos three times yesterday.
And why have autos weakened? “the industry has seen consumer demand diminish by high retail prices and interest rates, which has led to higher dealer inventories and slower production.”
Speaking of steel, from Steel Dynamics in their earnings release:
“Underlying steel demand continued to be stable in the 3rd quarter. However, earnings declined sequentially, based on lower average realized steel pricing.”
“Current order activity is steady with expectations for improved volumes in 2025, as interest rates decline and the support from the US infrastructure program and onshoring are expected to positively impact demand for not only steel joist and deck products, but also for flat rolled and long product steels.” A clear beneficiary of government spending and legislation and they also expect to benefit from hoped for lower interest rates and higher tariffs.
With respect to those tariffs and if someone wins, could be many more, “We believe current trade actions could also reduce volumes of unfairly traded steel imports into the US…which could have a significant positive impact for us.”
PPG also reported and they said this about the auto business, following what CSX said:
They mentioned that 7 of their 10 businesses saw volume growth “in several of our key technology businesses despite deterioration in automotive original equipment manufacturer (OEM) build rates during the quarter.” Automotive refinish coatings which includes collision related products did better and aerospace was an area of strength.
They said “industrial activity in the US and Europe was lackluster.”
Alcoa too talked about the auto sector, among other end markets:
“The transportation market overall has been steady with some slowing of growth within the automotive sector. For building and construction, it has been a challenging year, but rate cuts in Europe and in the US are likely to provide some support for recovery in the future. Global aluminum supply is growing, but with limited new projects in the pipeline.”
Also on the industrial side, from Prologis, the major warehouse and logistics REIT:
“Turning to the operating environment, conditions remain soft in many of our markets and as we’ve described over the last few quarters, this is despite healthy GDP and consumption growth. We ascribe the weaker relationship between economic output and industrial absorption to the availability built into the supply chain through Covid, originally earmarked for resiliency, but now available to operators as a source for cost containment.” In other words, too much space and not enough demand but they are confident their customers will grow into the extra capacity.
“Globally, we estimate that market rents decreased approximately 3% this quarter and roughly half this amount when excluding Southern California.” And, “Customers are very engaged, but they’re just not making decisions. So we expect this softness in rents to continue throughout this period.”
A key area of strength in the US economy is travel and from United Airlines:
“This quarter was the busiest third quarter in company history, setting the company records for the most ever passengers carried on the July 4th and Labor Day holidays and for the highest number of customers carried in a day at 552,000 in July.”
Overseas data of note, Japan reported weaker than expected September trade figures as did Singapore while Australia reported better than expected jobs numbers which led to a rise in bond yields there along with its currency.
The ECB is expected to cut interest rates again at 8:15am (SB Here – they did) and with little economic growth in the region, they have little interest in waiting to see if inflation sustainably stays down.
Finally, Chinese stocks, particularly those in property, sold off after China gave more details on how they plan on stabilizing its residential real estate market. They are doubling the loan quota they are offering in order to get some unfinished projects done. I think too many are looking for mega stimulus but Chinese officials are more looking for stabilization.
Peter Boockvar is an independent economist and market strategist. The Boock Report is independently produced by Peter Boockvar. Peter Boockvar is also the Chief Investment Officer of Bleakley Financial Group, LLC a Registered Investment Adviser. The Boock Report and Bleakley Financial Group, LLC are separate entities. Content contained in The Boock Report newsletters should not be construed as investment advice offered by Bleakley Financial Group, LLC or Peter Boockvar. This market commentary is for informational purposes only and is not meant to constitute a recommendation of any particular investment, security, portfolio of securities, transaction or investment strategy. The views expressed in this commentary should not be taken as advice to buy, sell or hold any security. To the extent any of the content published as part of this commentary may be deemed to be investment advice, such information is impersonal and not tailored to the investment needs of any specific person. No chart, graph, or other figure provided should be used to determine which securities to buy or sell. Consult your advisor about what is best for you.
Junk Bonds II
I keep a close eye on the junk bond market.
I shared the following with you in last week’s OMR titled Bond, Junk Bond (link here). This week, I’m updating the chart as it signals frequently and has moved back to a bullish posture. I’m uber-focused on it as it tends to lead to changes in the cyclical trends in the economy and stock market. It’s not a guarantee; it’s just another critical data point to watch.
Many investors use junk bonds as an alternative to stocks, sometimes viewing them as less risky due to the cash flow they generate. Junk bonds, also known as high-yield bonds, offer higher interest rates than bonds from financially stable companies. Small-cap companies are defined as businesses with annual revenues under $250 million. Because of their smaller size, growth spurts can significantly impact their earnings and stock prices. I’ve traded the high-yield junk bond market since the early 1990s and have found the junk bond market to be an effective leading indicator for the equity markets and the broader economy in general. I keep it on my recession watch radar.
The following chart illustrates the relationship between the Barclays High Yield Price Index at the top, the Standard & Poor’s 600 Index with a 36-day smoothing in the middle, and the NDR Small-Cap Advance/Decline Line with a 40-day smoothing at the bottom. The trend analysis indicates that junk bond prices often rise when small-cap trends are positive. Conversely, when small-cap trends decline, junk bond prices typically fall.
I believe this relationship exists for two reasons: both assets react similarly to changes in monetary policy, and both face similar liquidity and trading challenges. Therefore, multi-asset managers should not view junk bonds and small-cap stocks as entirely separate asset classes.
The direction of the junk bond market can be a useful leading indicator for the stock market and the overall economy, but it’s not foolproof. When junk bond prices rise, it often signals investor confidence, suggesting that economic conditions are improving and that companies with lower credit ratings are less likely to default. This optimism can translate to gains in the stock market, especially for small-cap and more volatile stocks, as investors are willing to take on higher risk.
Conversely, falling junk bond prices may indicate growing economic uncertainty or tightening financial conditions. Investors might expect higher default rates among riskier companies, which can precede broader market declines or signal a slowdown in economic activity.
However, while junk bonds can provide early clues, they should be used alongside other indicators like interest rates, credit spreads, and broader economic data to get a more comprehensive picture.
Chart B172 signals caution. I’ve highlighted the two moving average lines with red/yellow squares. Currently, the small-cap index (S&P 600 Index) just turned down below its 36-day smoothed moving average line (dotted black), and the S&P 600 Small Cap Advance Decline Line has fallen below its moving average line.
Corresponding data back to 1995 is in the lower left data box, while data since 12-27-2022 is plotted in the right data box. This is not a perfect process, and there are many false signals.
Source: Ned Davis Research
Another favorite of mine is looking at the actual price behavior using a popular high yield junk bond fund as a proxy for the high yield market. While the above looks at the price movement in small-cap stocks and the number of small-cap stocks advancing in price vs. declining, the next chart looks at two moving averages: a 12-day price moving average and a 26-day price moving average. The idea is to get a sense of what price is telling us about the strength of the high-yield bond market trend. Red arrows signal down trends, green arrows signal up trends. The current trend is down.
Source: StockCharts.com
Not a recommendation to buy or sell any security. For discussion purposes only. Current viewpoints are subject to change.
In Trade Signals, we combine a fundamental view with our arsenal of technical indicators to help with investment entry points and risk management.
If you are not a subscriber and would like a sample, reply to this email, and we’ll send you a sample.
Trade Signals is designed for traders and investors seeking a better understanding of macro trends. Click on the link below to subscribe or login. The letter is free for CMG clients.
TRADE SIGNALS SUBSCRIPTION ACKNOWLEDGEMENT / IMPORTANT DISCLOSURES
The views expressed herein are solely those of Steve Blumenthal as of the date of this report and are subject to change without notice. Not a recommendation to buy or sell any security.
Personal Note: Game Day, Again
I’m wrapping up this note from the Admirals Club lounge in Philadelphia. The in-flight Wi-Fi gave up about an hour before landing—not ideal, but in the grand scheme of things, there are far more significant global issues, so no complaints. It’s been a productive week, and it’s always good to be back home.
It’s game day again…
The Friars got a much-needed win on Monday, and by the time you read this, another tough game will be in the books.
I’m rushing to send this to the editing team before dashing to the high school to stand on the sidelines next to Susan, the world’s greatest coach (though I might be a little biased). Watching her coach has been an absolute joy. Go, Friars!
And speaking of great coaches, take a moment to send a note to your favorite coach, teacher, mentor, or friend. You’ll brighten their day, and I’m sure they’d love to hear from you.
With kind regards,
Steve
You can share this letter on X by clicking here.
You can share this letter on LinkedIn by clicking here.
Subscribe to OMR for free by clicking the photo.
Stephen B. Blumenthal
Executive Chairman & CIO
CMG Capital Management Group, Inc.
Private Wealth Client Website – www.cmgprivatewealth.com
TAMP Advisor Client Webiste – www.cmgwealth.com
Forbes Book – On My Radar, Navigating Stock Market Cycles. Stephen Blumenthal gives investors a game plan and the advice they need to develop a risk-minded and opportunity-based investment approach. It is about how to grow and defend your wealth. You can learn more here.
Stephen Blumenthal founded CMG Capital Management Group in 1992 and serves today as its Executive Chairman and CIO. Steve authors a free weekly e-letter entitled, “On My Radar.” Steve shares his views on macroeconomic research, valuations, portfolio construction, asset allocation and risk management.
Follow Steve on Twitter @SBlumenthalCMG and LinkedIn.
IMPORTANT DISCLOSURE INFORMATION
This document is prepared by CMG Capital Management Group, Inc. (“CMG”) and is circulated for informational and educational purposes only. There is no consideration given to the specific investment needs, objectives, or tolerances of any of the recipients. Additionally, CMG’s actual investment positions may, and often will, vary from its conclusions discussed herein based on any number of factors, such as client investment restrictions, portfolio rebalancing, and transaction costs, among others. Recipients should consult their own advisors, including tax advisors, before making any investment decision. This material is for informational and educational purposes only and is not an offer to sell or the solicitation of an offer to buy the securities or other instruments mentioned. This material does not constitute a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual investors which are necessary considerations before making any investment decision. Investors should consider whether any advice or recommendation in this research is suitable for their particular circumstances and, where appropriate, seek professional advice, including legal, tax, accounting, investment, or other advice. The views expressed herein are solely those of Steve Blumenthal as of the date of this report and are subject to change without notice.
Investing involves risk.
This letter may contain forward-looking statements relating to the objectives, opportunities, and future performance of the various investment markets, indices, and investments. Forward-looking statements may be identified by the use of such words as; “believe,” anticipate,” “planned,” “potential,” and other similar terms. Examples of forward-looking statements include, but are not limited to, estimates with respect to financial condition, results of operations, and success or lack of success of any particular market, index, investment, or investment strategy. All are subject to various factors, including, but not limited to, general and local economic conditions, changing levels of competition within certain industries and markets, changes in legislation or regulation, Federal Reserve policy, and other economic, competitive, governmental, regulatory, and technological factors affecting markets, indices, investments, investment strategy and portfolio positioning that could cause actual results to differ materially from projected results. Such statements are forward-looking in nature and involve a number of known and unknown risks, uncertainties, and other factors, and accordingly, actual results may differ materially from those reflected or contemplated in such forward-looking statements. Investors are cautioned not to place undue reliance on any forward-looking statements or examples. All statements made herein speak only as of the date that they were made. Investing is inherently risky and all investing involves the potential risk of loss.
Past performance does not guarantee or indicate future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by CMG), or any non-investment related content, made reference to directly or indirectly in this commentary will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this commentary serves as the receipt of, or as a substitute for, personalized investment advice from CMG. Please remember to contact CMG, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Unless, and until, you notify us, in writing, to the contrary, we shall continue to provide services as we do currently. CMG is neither a law firm, nor a certified public accounting firm, and no portion of the commentary content should be construed as legal or accounting advice.
No portion of the content should be construed as an offer or solicitation for the purchase or sale of any security. References to specific securities, investment programs or funds are for illustrative purposes only and are not intended to be, and should not be interpreted as recommendations to purchase or sell such securities.
This presentation does not discuss, directly or indirectly, the amount of the profits or losses realized or unrealized, by any CMG client from any specific funds or securities. Please note: In the event that CMG references performance results for an actual CMG portfolio, the results are reported net of advisory fees and inclusive of dividends. The performance referenced is that as determined and/or provided directly by the referenced funds and/or publishers, has not been independently verified, and does not reflect the performance of any specific CMG client. CMG clients may have experienced materially different performance based upon various factors during the corresponding time periods. See in links provided citing limitations of hypothetical back-tested information. Past performance cannot predict or guarantee future performance. Not a recommendation to buy or sell. Please talk to your advisor.
Information herein has been obtained from sources believed to be reliable, but we do not warrant its accuracy. This document is general communication and is provided for informational and/or educational purposes only. None of the content should be viewed as a suggestion that you take or refrain from taking any action nor as a recommendation for any specific investment product, strategy, or other such purposes.
In a rising interest rate environment, the value of fixed-income securities generally declines, and conversely, in a falling interest rate environment, the value of fixed-income securities generally increases. High-yield securities may be subject to heightened market, interest rate, or credit risk and should not be purchased solely because of the stated yield. Ratings are measured on a scale that ranges from AAA or Aaa (highest) to D or C (lowest). Investment-grade investments are those rated from highest down to BBB- or Baa3.
NOT FDIC INSURED. MAY LOSE VALUE. NO BANK GUARANTEE.
Certain information contained herein has been obtained from third-party sources believed to be reliable, but we cannot guarantee its accuracy or completeness.
In the event that there has been a change in an individual’s investment objective or financial situation, he/she is encouraged to consult with his/her investment professional.
Written Disclosure Statement. CMG is an SEC-registered investment adviser located in Malvern, Pennsylvania. Stephen B. Blumenthal is CMG’s founder and CEO. Please note: The above views are those of CMG and its CEO, Stephen Blumenthal, and do not reflect those of any sub-advisor that CMG may engage to manage any CMG strategy, or exclusively determines any internal strategy employed by CMG. A copy of CMG’s current written disclosure statement discussing advisory services and fees is available upon request or via CMG’s internet web site at www.cmgwealth.com/disclosures. CMG is committed to protecting your personal information. Click here to review CMG’s privacy policies.