Tea and Crumpets: Recent Episodes
Will Brown and Adam Eagleston
Tea and Crumpets is Formidable Asset Management's biweekly podcast that features Formidable's Managing Partner and CEO, Will Brown, and Chief Investment Officer, Adam Eagleston, CFA, talking directly about current events in relation to their expertise and business in a conversational manner.
After a summer hiatus, Will Brown and Adam Eagleston return to examine a market that appears to be reaching an important inflection point. They discuss the Federal Reserve's increasingly difficult balancing act as inflation remains stubbornly above target, government debt and interest payments continue to climb, and geopolitical tensions threaten to keep energy prices elevated. The conversation explores why these macroeconomic forces could shape the next phase of the market and what investors should be watching in the months ahead.
The episode also takes a deeper dive into the technology sector, where the AI investment boom continues to dominate headlines. Will and Adam question whether massive capital expenditures, lofty valuations, and aggressive accounting assumptions can continue to support today's market leaders. They examine the growing risks facing semiconductor companies, the role China may play in compressing industry margins, and why software and other fundamentally strong businesses may be poised to benefit as investors shift their attention back to sustainable earnings and disciplined execution.
Throughout the discussion, the hosts emphasize that periods when investing feels easy are often the most dangerous. As speculative enthusiasm begins to cool and market leadership broadens, they make the case that careful research, sound fundamentals, and a value-oriented approach are becoming increasingly important. It's a thoughtful conversation on separating durable opportunities from market hype while navigating an environment filled with economic uncertainty and rapidly changing market dynamics.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Summer is officially underway, and Will Brown and Adam Eagleston waste no time diving into the headlines shaping markets, energy, and investor sentiment. Against the backdrop of global soccer fever, the duo examines the recently announced Iran-related memorandum of understanding and what it could mean for oil prices, inflation, and the Federal Reserve. While markets initially cheered the agreement, Will and Adam explore the deeper supply-and-demand dynamics that could keep energy prices elevated and complicate the Fed's path forward.
The conversation then shifts to one of the market's hottest stories: the explosive rise of SpaceX and the broader AI-driven investment boom. Will and Adam discuss massive valuations, index inclusion decisions, leveraged ETF activity, and the growing concentration of market performance in a handful of technology and AI-related companies. Along the way, they raise important questions about capital spending, earnings quality, shareholder dilution, and whether investors are accurately assessing the risks embedded in today's most popular trades.
Wrapping up the episode, Will and Adam examine the increasingly interconnected nature of AI spending, corporate earnings, and index performance. They debate whether current growth expectations are sustainable, discuss the role of passive investing in amplifying market moves, and caution investors about the potential consequences if lofty expectations begin to crack. From oil markets and AI speculation to Fed policy and investor behavior, Will and Adam break it all down with their signature blend of insight, skepticism, and humor.
Topics Discussed:
- The Iran memorandum of understanding and its impact on oil markets
- Inflation, retail sales, and the Fed's policy challenges
- SpaceX's soaring valuation and market influence
- AI spending, capital expenditures, and earnings growth
- Index concentration and passive investing risks
- Equity issuance, shareholder dilution, and market speculation
- The outlook for technology stocks and broader market leadership
- Potential risks lurking beneath record market highs
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In this episode of Tea and Crumpets, Will Brown and Adam Eagleston dive into a market that appears remarkably calm on the surface while a growing list of geopolitical and economic risks continues to build beneath it. From escalating tensions in the Middle East and concerns over global energy supply to record stock market levels and speculative enthusiasm surrounding AI and upcoming IPOs, our host explore the growing disconnect between market optimism and economic reality.
Will and Adam discuss the potential consequences of prolonged disruptions to global oil markets, including the strategic importance of the Strait of Hormuz, declining energy inventories, and the possibility of a significant spike in oil prices. They examine how higher energy costs could ripple through the broader economy, impacting consumers, inflation, corporate earnings, and ultimately market valuations.
The conversation then shifts to the stock market's continued climb to all-time highs, fueled largely by AI-related investments and a handful of mega-cap technology companies. While acknowledging strong earnings growth among select firms, the Will and Adam question whether current valuations accurately reflect long-term realities, highlighting concerns around accounting treatment, capital expenditures, speculative behavior, and the growing influence of retail investors.
They also explore the changing structure of markets, the rise of passive investing, and the implications of major upcoming IPOs—including the highly anticipated SpaceX offering. They debate whether today's environment more closely resembles previous periods of technological innovation or the late stages of historical market bubbles.
Whether you're following global events, navigating today's markets, or simply trying to make sense of the headlines, this episode offers a thoughtful examination of the forces shaping the investment landscape—and the potential consequences if current trends continue.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In Part 2 of this special 100th episode celebration of Tea and Crumpets, Will Brown and Adam Eagleston continue their wide-ranging conversation with returning guest Kalee Kreider, diving deeper into the political, economic, and cultural consequences of the current geopolitical and financial environment. Building on the themes from Episode 100, the discussion shifts toward the upcoming U.S. election cycle, the evolving identity crisis within both political parties, and the broader implications of polarization, redistricting, and shifting voter coalitions. Kalee offers candid insight into why she believes Democrats are positioned to potentially retake both the House and Senate, while also cautioning that wave elections are rarely permanent and often produce only temporary political realignments. The conversation explores the changing nature of American politics, the future of Trump-era Republicanism, and whether Donald Trump represents a singular political figure or the beginning of a longer generational movement. The group also examines growing distrust in institutions and expertise following Covid, the influence of AI and technology on market psychology, and the increasingly fragile balance between economic optimism and geopolitical reality. The episode expands into broader discussions around military spending, drone warfare, NATO, energy security, and the long-term consequences of global remilitarization as tensions with Iran continue to escalate. The hosts debate the resilience of the U.S. dollar, concerns surrounding government debt and deficits, and the possibility that markets are displaying what they repeatedly describe as "irrational optimism" in the face of mounting systemic risks. Despite the heavy subject matter, the conversation maintains the humor and chemistry that have defined Tea and Crumpets across its first 100 episodes, closing with stories about distilleries, horse racing, bourbon, farming, and family history that bring a lighter and more personal finish to the landmark two-part discussion. Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In the 100th episode of Tea and Crumpets, Will Brown and Adam Eagleston celebrate the podcast's century mark by welcoming returning guest Kalee Kreider for a timely and expansive discussion on geopolitics, inflation, energy markets, and the growing disconnect between financial markets and economic realities on the ground. As Part 1 of this special two-part release, the conversation opens with reflections on reaching 100 episodes before quickly shifting into a deeper examination of the global and domestic pressures shaping the current economic environment. Kalee offers a unique perspective from both Washington, D.C. and rural Tennessee, highlighting how rising fuel prices, fertilizer shortages, drought conditions, and increasing property taxes are putting mounting pressure on farmers and middle-income households. The discussion explores how disruptions surrounding the Strait of Hormuz could have long-lasting consequences across industries far beyond gasoline prices, including agriculture, plastics, semiconductors, transportation, and airline travel. The group also examines how energy infrastructure shutdowns are not easily reversible, warning that even if geopolitical tensions eased quickly, the process of restoring supply chains and production capacity could take months or years. Throughout the episode, the trio debates whether markets and policymakers are underestimating the scale of the risks ahead, particularly as inflation remains persistent and consumers continue to feel squeezed despite stronger equity markets. The conversation touches on historical parallels to the mid-2000s economic cycle, the difficult position facing the Federal Reserve, and the possibility that demand destruction could eventually force rate cuts amid a slowing economy. Blending macroeconomic analysis with the humor and chemistry that have defined Tea and Crumpets over its first 100 episodes, Part 1 sets the stage for an even deeper continuation in Episode 101. Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In this episode of Tea and Crumpets, Will Brown and Adam Eagleston dive into a rapidly evolving geopolitical and economic landscape shaped by escalating tensions in the Middle East. With a fragile ceasefire in place and ongoing uncertainty surrounding key shipping routes like the Strait of Hormuz, the conversation explores how quickly conditions on the ground, and in the markets, are shifting. They highlight the difficulty of interpreting real-time information in an environment flooded with conflicting narratives and misinformation.
At the center of the discussion is the global energy market, where disruptions to oil supply chains are already creating ripple effects. Will and Adam unpack the complexities of oil pricing, the divergence between spot and futures markets, and the downstream consequences for inflation, supply chains, and consumer costs. They explain how restricted access to critical shipping lanes and selective distribution of oil are distorting global trade flows, while also emphasizing how energy shocks historically increase the likelihood of recession.
Beyond energy, the episode expands into broader economic risks, including weakening consumer sentiment, a softening labor outlook, and structural challenges tied to AI disruption and private credit markets. Will and Adam outline three major threats facing the economy (geopolitical conflict, financial system fragility, and workforce disruption) while also acknowledging the surprising resilience of equity markets so far. Despite the uncertainty, they close with a balanced perspective: volatility may create meaningful risks, but it also opens the door for selective opportunities in a rapidly changing investment landscape.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In episode 98 of Tea and Crumpets, Will Brown and Adam Eagleston address a rapidly unfolding geopolitical and market situation, as well as the broader assumptions investors have been relying on. What begins as a discussion of escalating tensions in the Middle East quickly turns into a deeper examination of how fragile global energy infrastructure, shifting policy decisions, and uncertain military outcomes are colliding in real time. The hosts highlight how quickly sentiment can swing, with markets reacting sharply to both escalation and temporary de-escalation, underscoring just how sensitive the current environment has become.
The conversation then moves into the structural implications of sustained disruption. Will and Adam explore the cascading effects of constrained oil supply, damage to critical infrastructure, and the logistical challenges of restarting energy production once it's been halted. They emphasize that even without further escalation, the duration of the conflict alone introduces long-term risks, particularly in energy markets, inflation expectations, and global trade flows. These pressures are already beginning to surface in bond markets and interest rate expectations, raising concerns that higher inflation could become more entrenched and more difficult to manage.
Beyond geopolitics, the episode widens its lens to include additional stress points building beneath the surface. The hosts discuss the potential for forced asset sales by sovereign wealth funds, the growing complexity and opacity of private credit markets, and the role artificial intelligence is playing in reshaping labor markets and corporate behavior. Together, these factors create a market environment defined less by a single narrative and more by a widening range of possible outcomes, making traditional forecasting increasingly difficult and reinforcing a more cautious approach to risk.
Throughout the episode, Will and Adam stress that uncertainty, not just negative news, is the dominant force shaping markets today. They encourage investors to remain disciplined, avoid reactionary decisions, and focus on positioning portfolios for resilience rather than chasing past winners. As the episode concludes, they leave listeners with a clear message: this is a moment that demands attention, patience, and a willingness to adapt as conditions continue to evolve.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In this episode of Tea and Crumpets, Adam Eagleston and Will Brown examine a rapidly evolving global environment where geopolitics, energy markets, and structural risks in finance are colliding. The discussion begins with the escalating conflict involving Iran and Israel and the immediate shock to global oil markets, where prices surged dramatically before partially retracing. Adam and Will explore how disruptions to Middle Eastern energy infrastructure and shipping routes could tighten global supply, increase inflation pressure, and complicate monetary policy decisions for the Federal Reserve.
The conversation then shifts to deeper vulnerabilities within financial markets. The hosts highlight growing concerns in private credit, where opaque lending structures and redemption pressures are beginning to surface across large institutional funds. They discuss how these off-balance-sheet lending vehicles have expanded rapidly and may introduce systemic risk if underlying assets are forced to be repriced.
Adam and Will also analyze the economic impact of artificial intelligence, particularly its potential to disrupt employment and reshape the software sector. While AI could improve productivity and corporate margins, it may also accelerate job displacement and create unexpected pressure across industries that rely heavily on knowledge workers.
Throughout the episode, the hosts stress the importance of remaining vigilant in a market environment filled with uncertainty—from geopolitical escalation to structural financial stresses. They conclude by discussing what indicators they are watching closely and how investors should think about risk management as events continue to unfold.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
After a brief hiatus (courtesy of a historic Southern ice storm), Adam and Will return to find an index-level market that looks deceptively calm—roughly flat since their last episode—while significant damage has been done beneath the surface to individual stocks. The disconnect between index stability and individual-stock carnage is the central thread of the episode.
The first major topic is AI capital expenditure. Most of the Mag 7 have committed to spending at a scale that would have seemed absurd just a few years ago, and the market, which once rewarded this enthusiasm, has begun to question it as free cash flow risks turning negative within a few years if spending continues at its current pace. The notable exception is Apple, which has largely preserved its free cash flow and financial engineering by not scaling its own AI infrastructure—instead positioning itself as a passive beneficiary of AI-driven hardware upgrade cycles as older devices become too underpowered to run next-generation software.
Software companies have been the most punished segment, with the market essentially pricing in near-zero terminal value for many names a decade out, despite those same companies still showing solid guidance in the near term. The AI disruption narrative has swept indiscriminately through software, insurance, and financial services, producing days where a significant slice of S&P 500 stocks fell sharply while the index itself stayed within striking distance of all-time highs. The hosts note that the damage at the individual stock level has been dramatically worse than what the indices suggest—the average constituent in growth-oriented indices has seen drawdowns many times deeper than the headline numbers.
A discussion of retail trading platforms—using Robinhood as a proxy—puts the individual investor experience in stark context: the average Robinhood trader has seen only modest gains over the past several years before taxes, a period in which simply indexing would have produced dramatically better results. The hosts draw a parallel to horse racing: people are generous in recounting their winners and silent about everything else. Incoming tax refund season may temporarily reflate the most speculative corners of the market, but the hosts are skeptical this represents durable demand.
The conversation ends on a more somber note around the K-shaped economy. Job growth has been concentrated in narrow sectors, consumer sentiment remains poor, healthcare costs are crushing small businesses, and AI is beginning to erode entry-level employment. The hosts express genuine concern that a large segment of the population—still financially scarred from COVID—is being further squeezed while capital markets continue to reward those who already have assets. Whether and how that tension resolves is left as an open and uncomfortable question.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We look at the eventful start to 2026 and try to put some context around potential market impacts. Geopolitically, we saw the renewed vigor of the Monroe Doctrine in full force with U.S. action against Venezuela's Nicolas Maduro. Whether stemming the flow of drugs or increasing the supply of oil was the primary factor is undetermined, though decades of underinvestment in infrastructure make any meaningful near-term effect on oil supply unlikely; lower oil prices have been one of the few things keeping inflation in check. We also discuss saber rattling as it relates to Greenland, whose strategic location has perhaps been underappreciated, and Iran, where citizen protests are increasingly being met by violence.
Affordability has been top of mind for the electorate, and the Administration, and we have seen presidential social media posts on housing and credit card interest rates. Though executive power has increased, barring institutions from buying single-family homes and capping credit card interest at 10% seems to have little likelihood of actually being implemented. However, housing affordability is a huge problem; according to Apollo:
- 54 million households can only afford a house priced less than $200k
- Another 40 million need prices between $200k and $400k
- With around 133 million households total in the U.S, and the median home price over $400k, the American dream of home ownership is simply out of reach for most
One mechanism viewed as a way to improve affordability is lower interest rates, though compelling the Fed to reduce rates by having the DoJ go after the current Fed chair may not have the desired effect. We discuss Chair Powell's stern response to the charges and the importance of maintaining Fed independence.
Finally, we recap a strong 2025 for equities (at least some of them), and look at the statistics showing just how few stocks outperformed the S&P 500 (fewer than one in five). This was the third year in a row where active managers had the deck stacked against them. For 2026, expectations are universally bullish. We look at the math behind higher equity prices in terms of multiples and earnings, and why a broader market, which started to take shape in December, might help investors but not necessarily matter for the index.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We take a detour into the Dickensian in evaluating the state of the economy. First, the recent inflation print, which showed a significant decline in the level of price increases, was a fiction worthy of Dickens, with the majority of the data simply made up as a result of the government shutdown. Setting that aside, since 2021, wage growth has not kept pace with inflation for food, shelter, and services, though we can count our blessings that at least alcohol prices have not increased as much…
Challenges face the Fed chair (both current and yet to come), and managing a deteriorating labor market and persistently higher prices presents a conundrum. The Fed is simply not getting what it wants at present in terms of rate cuts translating to a lower yield on the 10-year Treasury, and with deficits soaring in spite of a growing economy, some tough choices will have to be made.
However, stocks have proven remarkably resilient, and predictions from most Wall Street firms argue for a continued move higher supported by AI, solid growth, fiscal stimulus from tax policy, and further rate cuts. However, the math is a little challenging; to cite one example:
- The S&P reaches over 7,700 by this time next year (around 13% above where we are now)
- Earnings grow around 9% (this seems achievable, and maybe even a little conservative)
- Multiples expand to 26x earnings (this would be at peak dot com levels)
We think you might get this level of earnings growth (or better), but that multiple seems a little rambunctious. Even if we do get there, expect some market shenanigans on the way, as history shows mid-term election years tend to see large drawdowns; think back no further than 2022. The average midterm drawdown is around 18%, though the range is very wide.
Will brings it home with a reading from a speech given by Scrooge's nephew Fred so we end on a positive note celebrating the season.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
After Thanksgiving, we take a look at poultry, especially how dove-ish the Fed is now expected to be, a sharp reversal from a few weeks ago. We also discuss the odds-on favorite for the next Fed chair and how his political leanings may (or may not) influence which direction the Fed takes. Recent employment data has been lackluster, to put it mildly, which is forcing the Fed's hand as it relates to continued cuts. To wit:
- Total change in private employment – Negative 32k
- Manufacturing and construction – Negative 27k
- Small businesses – Negative 100k
Wage growth, especially for lower income households, is rapidly slowing, and those households spend, on average, over 70% of income on food, shelter, and transportation, all of which are seeing price increases that exceed wage growth. It seems like more pressure could be imminent on both wages and employment as AI continues to make inroads.
We take a detour away from economics into the carnage in the cryptocurrency space and what it may mean for certain types of companies that have built their business models on owning crypto.
In the second half of the show, we juxtapose the threat of AI for employees with the opportunity for employers. AI has been the savior in terms of growth and price appreciation for the stock market. Since the launch of ChatGPT in late 2022, earnings for technology and communications stocks have grown 121% versus a mere 27% for all other sectors. That trend is expected to continue in 2026, with the Mag 7 forecasted to grow over 20% versus 11% for the other 493 stocks. We also discuss just how big the Mag 7 are, with some individual members of the group larger than entire sectors of the economy from a market cap perspective. We discuss whether that is healthy (or sustainable) and why a broadening market is potentially overdue (not to mention healthy).
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
After a long hiatus (no, not related to the government shutdown) we return with a look at the economy and markets. On the economic front, despite a lack of formal data, signs point to a weakening labor market. Consumers in the bottom 80% have spending post-Covid that has barely kept pace with inflation, with prices higher by around 25% since 2020. Unemployment has climbed to over 9% for those between 20 and 24 years of age. All these are signs of a K-shaped economic recovery, with a strong stock market supporting higher spending for those in the top 20% of incomes. The Fed faces a challenge with a weakening labor market but inflation near 3%; the odds of a December rate cut have fallen to 50%.
In terms of the equity market, we have also seen a K-shape. While overall market performance has been narrow (only 158 out of 500 stocks in the S&P are outperforming YTD), it has been the Mag 7, which have seen strong earnings growth, and very speculative stocks, fueled by retail traders both in and outside the U.S. For the former, this growth comes with a caveat that their once strong free cash flows are being siphoned off (and bolstered by debt) to fuel the massive capital expenditure required to build out AI infrastructure. For the latter, a form of tribalism has united retail speculators, who are treating stocks much like sports wagering, which has also seen massive volume growth. It is important to note that despite stocks favored by retail investors performing well this year that, since 2021, the average Robinhood account is estimated to have declined in value while the S&P 500 is up substantially.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In this episode, we talk a pay homage to Will’s mentor by focusing on value and discipline, two things very much out of favor in the market at present. It is easy to see why as in the wake of five consecutive months of market gains, statistically the odds favor further appreciation. Moreover, even though valuations are high, historically valuation has proven a sub-optimal timing tool as it relates to near-term returns. With the Fed now more inclined to look more at weakening employment versus inflation, accommodative monetary policy seems supportive of valuation even at these elevated levels.
In terms of what has been working recently, it is a strange combination of the largest technology stocks, which are now involved in myriad deals reminiscent of the late 1990s in terms of vendor financing and capital spending, and speculative retail favorites, many of which have no revenue, much less positive earnings. We still find opportunities and lower valuations among smaller and mid-cap stocks, especially those that are higher quality.
However, since 2010, we have seen two very different markets. In the wake of the financials crisis, from August 2010 through August 2010, high quality stocks outperformed low-quality stocks by a factor of almost 3x. However, since that time, low quality stocks are up 140% versus high quality gaining only half that much. Retail investor speculation and the gamification of “investing” are contributing factors.
We also discuss the challenge facing consumers in terms of housing affordability, especially as the lower and middle income cohorts experiencing declining wage growth . To simply return to pre-Covid levels, it would take one of three things, or a combination thereof:
- Home prices fall 38%.
- Incomes to rise 60%.
- Mortgage rates to decline to 2.35%.
With the first two seemingly unlikely, can the Fed get there with rate cuts, or is some form of yield curve control required.
We are hoping for a Red October on the baseball diamond but not in the market, but only time will tell.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In this episode, we talk a lot about the job market, which is anything but hot, and its implications for the Fed, which is under pressure. All of the below tend to support President Trump’s criticism of Powell being “too late”:
- weakening job growth this summer (only +22k jobs in August, mostly in health care).
- likelihood of significant negative revisions this week.
- unemployment that would be over 5% if not for lower labor force participation.
Although unemployment is not an issue (yet), the risk in the labor market is a dearth of new jobs, with the odds of finding a job if you lose on today only 45%, the lowest level in over 12 years. We believe that AI is having an outsized effect on job openings, especially at the entry level.
All of these factors, along with a shift away from a focus on inflation by the Fed, support the market’s consensus view of a rate cut being on tap for next week, with two or three more likely to follow in quick succession. Historically, this has been a positive for equity markets if (and that is a big if) a recession can be avoided. the Fed has cut rates after an extended pause (like the one we are in now) eight times in the last forty years; four times we avoided a recession, and markets gained, on average, around 15%. the other four times, we entered a recession, with markets typically experiencing a 10-15% drawdown. Although there are some parallels between now and the late 1990s, valuations are not quite as stretched at the top, with the median P/E of the top 10 stocks around 31x versus a 41x multiple in 1999. However, investor allocation to equites is now at 55%, above its prior peak in 1999.
We also discuss the reasons why, despite Fed rate cuts, the all important 10-year yield may not cooperate. Chief among these are the lagged impact of tariffs on prices and the relatively high (and growing) level of U.S. government debt. Will the U.S. be forced to suppress yields a la the bank of Japan in order to unlock the housing market, and is that what is causing tempers to flare between members of the administration?
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In this episode, Will and Adam examine former Secretary of Labor Robert Reich’s comments comparing today to the Gilded Age. We acknowledge there are several similarities, including increasing wealth disparity, the emergence of disruptive technology, and widespread commingling of government with business. We specifically discuss the recent discussion around the government taking stake in public companies, which, though has a precedent, was used in the past during times of financial crisis, i.e., to keep automakers afloat during the financial crisis.
We discuss the (until just recently) ebullient vibes in the stock market, and why some of the forefront of the AI revolution are starting to sound a little more cautious about what AI can deliver in the near-term. However, that has not stopped investors from returning to familiar favorites from the 2021 run-up, with this rally’s best performers including:
- Non-profitable tech
- Most shorted stocks
- Meme stocks
With Fed chair Powell on tap for Jackson Hole, we look at the recent Fed minutes, which indicating a focus more on inflation than jobs, and why that could change if job revisions continue to be revised lower. However, with the inflation effect of tariffs expected to shift from businesses to consumers soon, will the Fed have the flexibility to cut rates as much as investors currently believe? With both anecdotes and hard data indicating a struggling consumer, the Fed is in a tough spot and under continuing political pressure.
We conclude with why it is important to remain systematic and focused on long-term investing success and resist the temptation of the continued gamification of stock trading, with platforms like Robin Hood now exploring the addition of traditional sports wagering alongside retail investment accounts.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In this episode, we provide a recap on earnings so far in Q2, which, so far, have been good enough for the market to remain near all-time highs. We also delve a little deeper into some of the megacap earnings, especially as it relates to whether accounting rules are optically improving earnings while cash flow is shrinking as spending on capital expenditures, specifically AI chips, is draining corporate coffers. To wit, free cash flow versus capex for the four biggest spenders (GOOG, META, AMZN, and MSFT) is as follows (in billions):
- 2024
- FCF - $233
-
Capex - $226
-
2025
- FCF - $207
-
Capex - $351
-
2026
- FCF - $240
-
Capex - $445
-
2027
- FCF - $289
- Capex - $512
In other words, these businesses, which once generated massive amounts of free cash flow for things like buybacks, are becoming much more capital intensive. However, since 2021, it has been only the 10 biggest stocks that have had earnings that have exceeded inflation; the other 490 have barely kept pace with overall price increases.
We also talk about inflation, specifically the shift toward the greater use of estimates versus actual inflation data, as well as the smoke signals from the economic intelligentsia hinting at a shift away from the fed’s long-standing 2% inflation target. In the spirit of government estimates, we also review the recent (abysmal) jobs data, and revisions, and connect that with the demise of certain professions, which ties into the massive AI spending driving corporate earnings and capital expenditures.
We close with a look at the strong recent performance of speculative stocks, the historically large nature of the volume in that trading, and why that has historically boded poorly going forward. Of particular note is the recent record flow into the Ark Innovation ETF.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In the first half, we look at the OBBBA, and what its passage may mean for investors, as well as for the government’s balance sheet.
Debt from baseline projection of 154% of GDP to upwards of 200% of GDP with the OBBBA. Deficits from around 6% of GDP to over 7% with the OBBBA.
Despite the ballooning deficits and debt, markets are celebrating the prospect of fiscal stimulus, as well as favorable tax treatments on investment as well as other corporate goodies.
In the second half, we discuss President Trump’s penmanship as it relates to his letter to Chair Powell on interest rates and why the “hottest country in the world” should “LOWER THE RATE!!!” We also look at the risk associated with the loss of Fed independence due to either political pressure or a dual role for the Treasury Secretary.
At some point, we finally get around to talking about the stock market, and note the historic rebound in equities in Q2, which was the largest in record by some measures. The biggest winners were growth stocks, which led value by a wider margin than during the tech bubble, and retail favorites, which are often highly speculative names; these soared over 60% in Q2. We also look at the expectations embedded in markets at this point in terms of earnings and multiples, and what effect passive investing is having on markets as over half of U.S. fund assets are now passively invested.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In the first half, we examine the (rumored) literal fisticuffs in D.C., and the implications of the proposed “Big, Beautiful Bill” on taxes, spending, the deficit, interest rates, and the dollar. We discuss the timing of tax cuts versus spending cuts, especially in light of the employment data we have seen since 2022, wherein:
- Private sector job growth -> a little over 1% cumulatively.
- Public sector job growth -> over 7% cumulatively.
In the second half, we discuss the market’s rapid rebound from its April nadir and juxtapose returns (and valuations) for different parts of the equity market. Is it finally time for diversification to help after a 15-year run for the U.S.?
- U.S. large caps +3% YTD
- U.S. small caps -2% YTD
- Developed non-U.S. +17% YTD
- Emerging markets +11% YTD
While the collapse in the volatility index and the huge rally from the lows normally portend further gains, valuations for the S&P 500 are historically high on any number of measures. While the so-called Magnificent Seven are more elevated, the other 493 are also expensive, and have grown earnings a lot more slowly than the tech titans. Contrary to our forecast entering 2025, fewer than one in three stocks are outperforming this year, putting a premium on stock selection. While multiples are high, we think active managers willing to go further afield can find values.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In this episode, we have a no-holds-barred conversation featuring Kalee Kreider, a seasoned political strategist and expert in climate policy.
Together, we dig into the uncomfortable truths about markets, politics, and the economic pressures facing everyday Americans. From election forecasts and the appeal of government gridlock to the harsh realities of student debt, the conversation is unscripted, unfiltered, and unexpectedly funny.
We explore why investors often prefer a slow-moving Congress, how middle-income families are still reeling from financial burdens nobody talks about, and why economic narratives need more honesty and a lot less spin.
What You’ll Learn:
- Why political gridlock can actually calm the markets
- The ongoing impact of student debt on families earning six figures
- What’s really driving midterm election outcomes—and what to expect next
- How public perception influences both policy and portfolio performance
- Why clarity in communication is just as valuable as a solid balance sheet
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In the first half, we discuss the showdown between the U.S. and China on tariffs. While the headlines have been stolen by who is calling whom first, we look into the effect the tariffs are already having on container ship volumes, and what implications that has for the rest of the supply chain, and the economy. Tariffs are just starting to hit consumers as they look to buy online, with the tariff exceeding the purchase price in some cases. While there is optimism over a resolution, historically trade agreements have involved lengthy negotiations, and we are weeks away from the initial impact of being felt, making this akin to a slow moving shipwreck. We also discuss the impact of student loan payments turning back on after years of forbearance.
In the second half, we discuss the rebound in U.S. equities, which are anticipating a quick and painless resolution to the trade war, along with three or four cuts by the Federal Reserve during the rest of this year. In our opinion, that number of cuts would only occur if we saw the onset of a recession, which has significant market implications.
- Since World War II, the average recession sees gross domestic product (GDP) decline 2.3%.
- The average earnings decline for the S&P 500 is 11% during a recession
- However, around 1/3 of the time, earnings decline 5% or less.
Many market strategists are celebrating the recent equity rebound, which has been broad based and triggered a number of positive market breadth signals. While these are normally positive portents, valuation is not part of the calculation, and any disappointment in terms of the current earnings estimates leaves little room for error, making us mindful of seeking opportunities outside of the index, which continues to be dominated by a handful of stocks.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In the first half, we discuss Liberation Day, the violent reaction of, initially, the stock market and, subsequently, the bond market. In terms of the bond market, we look at the frantic trading from last week that ultimately forced the administration to announce a 90-day pause on most tariffs. Who holds U.S. debt? The answer might surprise you:
- Total debt - $34 trillion
- Domestic holders - $26 trillion
- Japan - $1.1 trillion
- China - $820 billion (though may be understated as offshore entities, i.e., other countries, are likely being used as well)
- Other countries - $5.3 trillion
In the second half, we discuss the volatile reaction of equities to headlines.
- Post-Liberation Day, over a 10% decline in two days.
- The third largest daily gain ever for the S&P 500 on April 9th (when the 90-day pause was announced).
While many pundits cite such a large up day as being a portent of further gains, which is true historically, we put it in context of valuation, and the 20.7x P/E the market currently has is well above the 12.7x multiple the market had on average after other large gains. Similarly, we look at expectations for earnings, what we have heard so far (JP Morgan noted deteriorating credit trends while Wells cited resilient spending), and what we think we might hear from companies as earnings season gets into full swing (hint: prepare for the word “uncertainty” to be a common refrain). Finally, we discuss the administration’s stated objectives of bringing back manufacturing and reducing trade deficits. What is not often mentioned is that this approach overlooks service surpluses, and is causing a sharp decline in foreign tourism, which may jeopardize these surpluses.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In the first half, we discuss the imminent arrival of “Liberation Day”, and why uncertainty over tariffs is causing consternation to consumer, business, and investor confidence. We look at the most recent inflation data from the government and examine the widely divergent inflation expectations based on political affiliation. We also tie this to the likelihood of further rate cuts and the necessity to drive rates lower as sizable government debt is due to be refinanced in 2025.
In the second half, we (finally) discuss what has been a challenging quarter for stocks, especially the Magnificent Seven:
- In the aggregate, the Mag Seven are in a bear market (down 20%).
- The S&P 500 is down 5% YTD and 10% below its all-time high, led lower by the Mag Seven.
- The average stock in the NASDAQ is 35% below its high.
The path forward for the market depends on the impact of tariffs and spending cuts, both of which are likely headwinds in the near term. With both valuations and earnings expectations still elevated, there remains downside in the event of either an economic or earnings recession. However, value stocks have performed well year-to-date, as have non-U.S. stocks, which are garnering attention as a result of changing U.S. trade and foreign policy. In other words, diversification has (finally) been helping.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In the first half, Will and Adam discuss the rapid deterioration in consumer sentiment and how it is cutting across both economic and political divides, albeit to differing degrees. Some sentiment indicators, especially concerns over job loss, are at levels normally seen during a recession, in part due to the uncertainty over tariffs with large trading partners like Canada. Another concern is spending cuts. We look past the headlines to see that cuts have not yet taken hold, though with 85% of job growth in 2024 attributable to government spending, we could be in for a volatile transition period as a result of the “detox” the administration is seeking.
In the second half, we look at the recent (albeit brief) market correction, and put it in historical context:
- Since 1980, the average yearly decline for the S&P 500 has been 14%.
- There have been about 117 10% corrections since 1928, so around one per year.
- Statistically, a 10% correction turns into a bear market around 25% of the time, and that normally occurs when the economy dips into a recession. The rest of the time, the market recovers in about eight months, on average.
Although modest, the 10% correction is equivalent to 12% of GDP. That type of hit to wealth has contributed to a recession in about half of the prior 12 occurrences.
With the Magnificent Seven, on balance, lagging this year, we look at the prospect of a broader market showing the benefits of diversification, not to mention the strong start to the year for non-U.S. stocks, which have been buoyed by the shift in spending priorities in both developed and emerging markets.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
With headlines versus earnings moving markets, we look at the perceptions and realities influencing investors (and speculators).
In the first half, we discuss the sharp decline in consumer confidence and spike in inflation expectations, both of which represent challenges to continued equity market strength. We also look at how the bond market (and the Federal Reserve) are responding, and how the continued on again/off again/on again tariff headlines are causing consternation to consumers and investors.
In the second half, we delve into the perception versus reality of government efforts to cut waste and if that is enough to reduce the deficit enough to achieve the administration’s goal of a lower yield on longer term Treasuries. We also look into the effects of wealth and spending inequality on the economy. There is also a continued discussion of the effect of passive fund flows and levered ETFs on some of the markets biggest names, and how those are widening the dispersion between stock indices versus the average stock; to wit:
- The NASDAQ is only 5% from its year-to-date high, while the average NASDAQ stock is 25% from its high.
- Only 22% of stocks in the S&P 500 outperformed the index over the past 12 months.
- After six of the so-called Magnificent Seven outperformed in 2024, only one is ahead of the S&P 500 so far this year.
We close with our thoughts on where we are seeing positives and why, eventually, fundamentals may matter more than headlines.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
With tariffs in the news, we sift through the torrent of headlines coming from both sides of the border and beyond. In the first half, we look at the breaking news on tariffs, with an 11th hour agreement with Mexico giving a pause to the proposed 25% duty on imports. We also look at why Canada may be more reticent to strike a deal, and what the bigger objectives may be. Is it all about oil and inflation, or are we looking at a 21st century version of the Monroe Doctrine aimed at China? We also break down how the Fed is assessing the situation. In the second half, we finally get to the stock market. We look at the effect of Deep Seek news coming out of China on AI stocks, and whether it represents a opportunity or a threat for the sector. We also recap the first big week of technology earnings:
- Four of the Magnificent Seven reported.
- While the initial reaction was positive for three of the four, only one has held onto its gains.
We close with our thoughts on where we are in the economic (and market) cycle, and where we are looking for opportunities.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
After a holiday hiatus, we welcome 2025 with a look at what worked in 2024 and what that may mean for this year.
One thing that did not work: forecasts. The Fed cut rates fewer times than predicted, and we discuss the recent pivot toward a more hawkish tone, which is part of the reason for the increase in yields on longer bonds. Those higher yields are stressing consumers and businesses, not to mention grinding mortgage activity to a halt. We look at the implications of higher rates and compare some of the small business stress we are seeing in our community versus the strong jobs data being reported, which is influencing the Fed’s outlook for rate cuts.
In the second half, we discuss stock returns in 2024, which were biased upward by a handful of stocks in one (well, two, as defined by the S&P committee) sectors. We compare the level of index concentration, valuation, and performance dispersion versus history and find the clearest parallel with 1998 and 1999. After that period, we saw the following pattern emerge:
- The average stock beat the index each of the next six years.
- Value stocks beat growth stocks each of the next seven years.
We close with our thoughts on why that could be replicated again, specifically given the implications of likely Trump administration policy on merger and acquisition activity, which is off to a strong start.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We take a wicked look upward, where both unidentified drones and market valuations reside. We also discuss the upcoming Fed meeting, investor sentiment, and the outlook for corporate margins (and employment) as AI gains greater adoption.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We discuss the recent mania around levered ETFs and the market mechanics that make these so volatile. We also take our first look at investor response to Trump’s win and what we think some of the over (and under) reactions have been so far, and what the true implications of changes in fiscal and regulatory policy may mean.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
This week, Will and Adam discuss how markets typically respond to the election cycle, and the importance of staying committed to the long-term view when it comes to investing. We also do a deep, some may say submarine, dive on the phenomenon causing some of the extreme weather we are seeing, and compare this type of explosion and its effects to how the explosion of post-Covid stimulus has affected inflation, stocks, and bonds.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We recap the historically strong year-to-date performance of equities and compare Q3 versus the first half of the year. We also delve into the potential market implications of the upcoming presidential elections as well as the ongoing (and escalating) conflict in the Middle East.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Special guest Kalee Kreider joins us to discuss the recent presidential debate, its impact on the November election, and all things political. We also explore the impact of broad trends like inflation and AI on the election, the economy, and markets.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam discuss the large downward revision in job creation and analyze its causes and implications. With the Fed meeting in Jackson Hole, they review its current stance on interest rates versus market expectations, as well as the divergent paths the market has historically taken around rate cutting cycles.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam return to provide insight on recent market tumult. We look at the causes (recession concerns, Japanese bank policy) and the effects (sharp decline, quick rebound, spike in volatility). We compare what is normal about today’s environment versus the anomalies that cause us some concern.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We wish Formidable a happy 11th birthday, though the more eccentric among us may say “get well soon”, instead. Regardless, we look back on our approach to college planning and the merits of trade schools in the era of AI. We also examine AI’s broader implications for inflation, wages, and stocks, both those that area direct beneficiaries (like the Magnificent Seven) and those that have, so far, been left behind from a performance perspective, where we see opportunity.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam review the new Bearcats flavored Grippo chips, and compare them to the Fed’s approach on inflation. We take a look at what the lack of movement in oil prices is telling us about inflation and the economy, and how higher interest rates are (or, more accurately, are not) constricting some measures of financial conditions.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We discuss the fluid situation in the Middle East, its impact on oil, and, ultimately, its importance as a key stumbling block on the Fed’s path to 2% inflation. The changing expectations regarding Fed rate cuts and how those should (theoretically) affect valuations for stocks are also key topics, as are some of the recent divergences in the historical relationships between things like gold and real rates.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam discuss the potential for broader equity market participation, as well as the strange dynamics affecting the smaller cap indices. We also deconstruct the latest Fed minutes, and what the Fed’s changing stance on inflation may mean for interest rates, stocks, risk, and housing. Finally, we explore whether one can forge their own signature, if plant-based mashed potatoes is redundant, and the merits of Kenny Rogers’ “good food quickly” approach to chicken.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In episode 66, Will and Adam discuss the Fed’s shifting stance on its inflation target and the implications for consumers and markets. We also examine the diverging fortunes of the Magnificent Seven and compare today’s market conditions with those of the early 2022 peak as well as the 2000 peak.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We welcome back special guest Kalee Kreider, president of Ridgely Walsh and former communications director for Vice President Al Gore. With November fast approaching, we get her take on the candidates, what states might determine the outcome, and why “double haters” may be the deciding factor. We also evaluate the implications of the outcome in terms of both foreign and domestic policy. Finally, we take a look at a few under-the-radar Supreme Court cases with significant implications for the functioning of the Federal bureaucracy in 2024 and beyond.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In episode 64, Will and Adam discuss the winnowing of the Magnificent Seven to somewhere between three and four, and the exorbitant valuations on the shrinking number of winners. We also look at the conundrum faced by businesses dealing with pushback from consumers on rising prices while at the same time increasing demands (not to mention government mandates) on wages.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam return from a hiatus with the S&P 500 at an all-time high. They recap what drove returns in 2023 (index flows, zero-day options, the Magnificent Seven) and what expectations are baked into valuations at current levels (above-average earnings growth and six Fed rate cuts). They also juxtapose the divergent growth expectations the low price of oil seems to be indicating in spite of elevated geopolitical tensions.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We revisit the risks associated with passive investing as the Magnificent Seven stocks become even more unmoored from the rest of the S&P 500. We also analyze the likelihood of the Fed engineering a soft landing, why the market may have celebrated a win on inflation too early, and how we are trying to navigate through this challenging environment.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We talk about the ongoing shift in labor market dynamics and its implications for inflation going forward, which could be “higher-er for longer-er”. The market’s recent rebound, fueled by hopes of a soft landing and a bounce in the most shorted stocks, is also discussed. We also look at concentration of the index in a handful of stocks and compare recent earnings for some of the tech titans to the rosy projections for next year.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam provide their perspective on the market impact of events in Israel and Gaza, which come at a perilous time from a market perspective with yields reaching psychologically important levels. We also discuss how flows into passive funds have had an outsized impact on the so-called Magnificent Seven stocks and juxtapose their performance (and valuation) versus the rest of the market. Finally, we look at some real-time data on what is happening for economic canaries like shipping and small business.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In the midst of typical seasonal weakness, we examine the causes for the stock market’s recent volatility, as well as the unprecedented moves in the bond market. We also look at oil’s ability to help the economy to a Goldilocks scenario, how labor unrest is affecting inflation and consumer sentiment, and whether one person can riot.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
After enjoying the festivities, including a fantastic caricature, we delve into the underappreciated risks associated with both zero-day options and put writing, given the launch of a new ETF that combines the two. We examine the market’s recent reaction to CPI data and the potential for inflation to re-accelerate with soaring oil prices and wage pressure from the current UAW strike.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We parse Fed Chair Powell’s Jackson Hole speech and assess the odds (and timing) of further rate hikes versus a pivot. We also examine the impact on the global economy of China’s weakening property market. We conclude with a look at the recent weakness in U.S. consumer stocks and debate whether expectations for megacap tech earnings are too high in the wake of this week’s market reaction to everyone’s favorite AI stock.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We return from hiatus with a recap of the happenings in emerging markets, including Chinese property problems and Argentinian elections. We juxtapose the echo boom in tech names with the so-called dot com darlings, and look at how those high-flying companies fared in terms of sales growth (outstanding) and investment returns (dreadful). We close with the odds of and implications for a pivot by the Fed.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We welcome special guest Kalee Kreider, president of Ridgely Walsh and former communications director for Vice President Al Gore. She offers a unique perspective on the recent debt ceiling resolution, as well as the broader implications of “Bidenomics”. She, Will, and Adam discuss the implications of fiscal policy on the Fed, inflation, and the political landscape for 2024. We close with a conversation on the emerging power of the executive branch, and its supporting bureaucracy, in the wake of a dysfunctional legislative branch, and the role a changing Supreme Court may have. It’s like eight grade civics, only entertaining.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We discuss the continuing game of chicken being played over the debt ceiling, and why any ultimate resolution to increase the government’s borrowing ability is a negative for bond yields and equities. Also, you cannot have a podcast in 2023 without talking about AI, and we explore its impact on equity market returns so far this year (positive) as well the murkier longer-term impact on things like inflation and unemployment.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We discuss recent comments by the Fed and bank industry luminaries as it relates to whether the current bank crisis is closer to the beginning or the end. We also delve into the continuing divergence between earnings expectations and interest rate expectations, and why this is the most important problem markets must solve. Finally, we cover the simple math behind inflation and assess our chances of getting back to the Fed’s 2% target in one piece.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Technology investors keep dancing as the NASDAQ enters a bull market. We compare the performance of the largest names in the index versus the rest and evaluate the reasons why the performance of the average stock has been so lackluster. We also delve into the seemingly irreconcilable difference between the outlook for earnings and interest rates, as well as the ongoing fallout higher rates have caused for the banking industry. We close with our opinion on the market’s relative upside versus downside based on the positioning of both retail investors and institutional quant funds.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We delve deeply into pun-ditry, as well as a continued post-mortem of Silicon Valley Bank. Will casts doubts over Adam’s ability to be a bond guy (or girl), and they also discuss the Fed’s strong conviction, Wile E. Coyote-style stretching of the economic rubber band and the potential implications of its snap back in the event the Fed is forced to pivot.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam provide an update on the continued fallout in the banking sector, including what it means for consumers and markets. The surprising rebound in technology stocks despite a nascent banking crisis is also analyzed and compared to what we experienced during the financial crisis. We also debate what the opposite of inverted is and why it is important to our outlook for the economy. For even more, click here to read Will’s comments on Silicon Valley Bank in Barron’s.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We discuss the topic on everyone’s mind, Silicon Valley Bank, and delve into the reasons for its failure and potential consequences. Who’s to blame, who’s not, and what comes next?
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We look at the self-proclaimed new Nasdaq, a.k.a., Ark, as emblematic of the ferocious return of speculation in 2023. We also look at the behavior of meme stock speculators and debate the role the Fed may or may not in fomenting speculation as it (and we) debate how restrictive policy is versus how restrictive it needs to be.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam discuss the challenges faced by the Fed as it sees financial conditions easing despite its efforts to restrict monetary policy. We also analyze the health of the consumer in the world of high interest rates, low savings rates, and increasing levels of debt. The unprecedented collapse in money supply growth, and the recent spike in velocity, are addressed as well.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We review a challenging 2022, capped off by a December to forget for those looking for a Santa rally. The causes (Fed policy, rampant retail speculation) and effects (multiple compression, sizable capital losses) are analyzed, along with some perspective on how we are preparing for 2023.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We give an enthusiastic meh to 2022, an anomalous year in so many ways: stocks and bonds both lower, the Fed raising rates at a historic pace, and geopolitical turmoil. We also delve into the Fed’s inflation versus recession conundrum, the consequences of capital once again having a cost, and what 2023 may hold based on our top-down process.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We review the tumult in the crypto markets in the wake of FTX’s demise. The markets resilience in the face of crypto, geopolitical, and inflation headwinds is another topic of discussion. We also look at the technical indicators pointing toward a recession here in the U.S., as well as the market implications of a Fed pivot.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In the wake of the release of the Fed’s minutes, we discuss relevant acronyms (FIFA, NATO, FUBAR) as well as a few four-letter words the hawkish comments elicited from markets. We compare the minutes to the tenor of the press conference, the likely paths inflation might follow, and the implications for equity valuations and earning.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In the wake of the release of the Fed’s minutes, we discuss relevant acronyms (FIFA, NATO, FUBAR) as well as a few four-letter words the hawkish comments elicited from markets. We compare the minutes to the tenor of the press conference, the likely paths inflation might follow, and the implications for equity valuations and earning.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Does the market have one? We discuss the recent signs of market life despite what seems like the Fed’s desire to raise rates no matter the collateral damage. We also explore the parody that is risk parity, and the danger it poses to pension funds.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We look at the historically woeful start to 2022 for both stocks and bonds and explain why these coinciding declines are causing stress in the financial system, as well for investors. We also analyze the efficacy of the Fed’s toolkit to fight inflation and how rate increases typically flow through the economy. Finally, we describe how the market has repriced earnings and illustrate how the numerator and denominator of the P/E ratio are affecting valuations.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Are recent comments by the Fed inspiring or perspiring? We discuss the sub-optimal setup for the European Central Bank, what is helping (and hurting) the case for a reversion to sub-2% inflation domestically, and what it means for markets over the near- and medium-term. Also, public service announcements on preventative health care and meme stocks.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We look at the situation facing the Fed as the market anxiously awaits comments from Jackson Hole. With student debt forgiveness and the misnamed Inflation Reduction Act renewing fiscal stimulus, can the Fed engineer a soft landing? We also analyze the divergence between the favorable technical setup versus stretched valuations. Finally, we recap the most recent round of meme stock mania which, thankfully, we watched from the sidelines.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
In a market that makes about as much sense as August having an extra day, we examine the reasons for the strong equity returns in July and the incongruent views the market currently has on rates versus earnings expectations. We also discuss the squeeze consumers are feeling as savings rates decline and credit card debt expands.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
After a brief hiatus, Will and Adam return to talk about the market’s welcome recent rebound. Is it a head fake or will the bad news is good news narrative continue? Higher inflation and restrictive Fed policy have the potential to head butt investors, but the technical set-up remains favorable.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Are equity markets still in the danger zone? Join Will, Adam, and Kenny Loggins (well, two of the three) as they discuss the brief bear market, what is fueling the recent rebound, and whether we are in for more turbulence. Can the Fed engineer a soft landing, or will it crash and burn? Be our wingman as we explore these topics and more.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Investors are certainly frowning upon the Fed’s recent comments. We explore large caps trading like small caps, how inflation is affecting consumer behavior and how companies are responding. We also delve into prior periods of market distress to look for signs as to how far along the current drawdown may be.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
The market’s recent selloff is in focus. Can the Fed be seen as slightly accommodative while still getting a handle on inflation, or is that just as impossible as our title? What are the effects of the war in Ukraine and Chinese lockdowns on inflation, and how big are they as building blocks of the current wall of worry? We also discuss the parts of our investment strategy that become more important in this environment.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will the Fed do little, or is under too much political pressure to just talk about raising rates to fight inflation? Is China’s “zero Covid” policy really an inflation fighting tool? What explains the divergence between institutional and retail investor behavior, and are they considering the tough lessons the market taught us in the 1970s and late 1990s? We address these questions and more.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Should the Fed take it easy, or is the heat on? We explore the Fed’s recent meeting and the market’s reaction, not to mention the mounting inflation pressures consumers are feeling. We also discuss the implications of the ongoing crisis in Ukraine as well as China’s burgeoning Covid lockdowns.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We provide an update on the current crisis in Ukraine, focusing on its effect on inflation as well as equity and fixed income markets. We look at historical analogs and debate what, if any, effect the conflict may have as it relates to the Fed’s efforts to tame inflation.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We provide predictions on the Super Bowl, which should be heeded, given Will’s accurate NASDAQ premonition; we discuss the drawdown and our analysis on the reasons for it. We also address the bifurcation between the performance of the “average” stock and the index, as well as the likelihood and consequences of the Fed meeting its stated rate rise regime.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We discuss the Fed’s hawkish pivot and whether it is rooted in reality or an effort to use its words to convince the market it is serious about inflation. We also look back to prior tightening cycles as a frame of reference for potential equity market weakness, as well as exploring the omicron variant’s effect on society, supply chains, and the economy more broadly.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam discuss the market’s reaction to the last big event of the year, i.e., the Fed’s December meeting. We also try to discern what its stance tells us about the prospects for growth, inflation, and the omicron variant. We also explore the structural reasons inflation might decline despite the shrinking pool of labor, as well as the widening chasm between the performance of the stock market and that of the individual stocks of which it is comprised.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
After a brief hiatus due to technical difficulties, Will and Adam return to a market fraught with the same. We explore how index performance masks the performance of the average stock, not to mention how the U.S. has diverged from every other market. We also examine the Fed’s shift from its transitory narrative, debate whether proposed tapering is likely bark or bite, and end with an analysis of the Biden administration’s curiously active November, especially against the backdrop of the Omicron variant.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
With football mania sweeping Cincinnati, we talk about some other manias that are helping lift markets to all-time highs. We also juxtapose the most recent monetary policy decisions of the Fed and Bank of England and how each reflects a slightly variant view of the variant. Finally, we head down the rabbit hole to talk COVID, cryptocurrencies, and oil.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We return with a new format but provide updates on some old favorites: inflation, complacency, and valuation. We also explore how the “sky is falling” narrative is changing how investors allocate capital, especially in the energy sector, why legacy producers in the Middle East are okay with the Mad Max scarcity scenario, and how U.S. producers are the Jekyll and Hyde that moodily swing prices. Stay tuned until the full time whistle, when Will gives the team talk on speculating with leverage.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam discuss the challenges associated with being a contrarian. Specifically, hating things universally loved, like the S&P 500 and Betty White. They also explore the market’s complacency despite the specter of inflation, Chinese economic risks, retail being “maxed out” on equities, and potential fiscal headwinds domestically.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam discuss the newest COVID variant, as well as the repercussions of the Afghanistan withdrawal, especially as they relate to potentially reduced fiscal stimulus. We also juxtapose how September has historically been trouble for markets versus the current win streak, which typically bodes well for returns.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will & Adam explore the cacophony emanating from the loudest voices in the room on things like meme stocks and the delta variant, and provide our own measured analysis to separate hyperbole from reality. We also explore the jaws opening between economic data and interest rates, the Fed’s conundrum, and stretched valuations for the most speculative stocks.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We ignore the flashing red light on the microphone, just like markets have been ignoring any number of warning signs. We discuss the bond market (or lack thereof), explore the conflicting signals sent by treasury yields, and the explore the inexplicable appetite for the currently misnamed high-yield debt. The bifurcation of equity returns between megacap and the rest is discussed, as are the potential effects of the delta variant on supply chains. We also discover Will and Adam were, unsurprisingly, both in high school Latin clubs. Caveat emptor.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
We bark again about the continued mania in meme stocks, as well as delve into the inflationary pressures building in certain parts of the economy. The massive flows into equities and misnamed “high yield” debt are also topics of conversation, as are looking to the late 1940s and late 1960s as potential playbooks for what might be a choppy remainder of the year.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Come aboard. We’re expecting you… We make another run after a technology glitch to discuss the Love Boat’s star-crossed investors, the knife-sharpening industry, and the strange dichotomy between market complacency as a whole versus the mania around retail trading in meme stocks. From there, we delve into a discussion of inflation as reflected in things like lumber and labor. We then debate how a trade can be both right and wrong concurrently and why capital allocation matters for companies in secular decline.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam delve into the return of meme-stock mania and address listener feedback vis-à-vis valuations and geese. They also discuss the circular logic of inflation versus expectations, how the market interprets this, and how the real impact of inflation is often mismeasured, using candy bar sizes. No free samples of a candy line-up will be provided.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam explore human overconfidence, be it in fighting an animal, like a goose, or with regard to investing. We spend some time on the Indian variant, inflation expectations, and the rhyming nature of today’s speculative activities with prior episodes of mania.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam review the market’s reaction to further fiscal stimulus, lack thereof to proposed tax changes, and compare the Fed’s largesse with the printer to our favorite confetti-throwing comedian. Obligatory discussions of lumber price inflation and employee scarcity also ensue, as does a more somber discussion of the overlooked Covid calamity in India.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam look right in the old lumber yard to discuss inflation and how government stimulus is affecting both sides of the inflation equation, especially as it relates to crowding out in the labor market. We also explore interest rates, the rotation back to large cap despite enthusiasm over re-opening and robust growth prospects for Q2, and the shift in retail investor activity.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam explore the rebellion in stock markets, including the recent carnage prompted by margin calls on a highly levered family office. The two also discuss the red-hot housing market, transitory vs. lasting inflation, the bond market’s appetite for junk, the surprising strength of the dollar and its effect on Burl Ives’ favorite commodities.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam delve into grammar and how adding misused words, e.g., supposably, to the dictionary normalizes stupidity and is analogous to the market rewarding investors in meme stocks. We connect the dots on the disconnect between the Fed’s transitory view of inflation versus what the market is anticipating, look at the overlooked impact of the variant in Europe, and discuss other risks the market is currently ignoring in its desire to mitigate FOMO.
Learn more about Formidable Asset Management, Will Brown, and Adam Eagleston by visiting www.formidableam.com.
Will and Adam welcome Jennie Ripps, co-founder and CEO of Owl’s Brew, an emerging leader in the rapidly growing hard tea category. The three talk about the history of the company, its pivot to boozy tea, the challenges and opportunities of running a business during a pandemic, and why ingredients matter if you want to drink wise. They put the latter to the test with an impromptu taste comparison, and conclude with an analysis of the relative perceived sagacity of spectacles versus monocles.
While Will and Adam may, a lot of people have been misusing the term lately. We discuss how all stocks are equal, though some are more equal than others, where we see (and do not see) inflation, and what that means for equities, especially small caps, and bonds. We close with some perspective on what has been driving the outperformance in certain frothy areas of the market, why it may continue, and what risks are being overlooked.
Like the Electric Light Orchestra, Will and Adam have no answer for what is happening right now, but a lot of questions. They cover similarities and differences between now and the late 1990s, discuss valuation for various parts of the market, where they see relatively unattractive risk versus reward, and delve into specifics on a few names in the news.
Will Brown and Adam Eagleston in the same room…drinking while recording a podcast. What could possibly go wrong? Apparently, everything. Listen to the two echo one another’s comments (literally) on election fallout and the widening chasm between economic reality and valuations in certain parts of the market. Will and Adam experienced technical difficulties in the recording of this podcast—we apologize for the sound quality.
Of the periodic table, that is. We talk hydrogen vs. gravity power, rubidium-colored drinks, even unstable francium, provide an update on the potassium-shaped recovery, and answer questions regarding one of our recent white papers. Listening is even easier than Elon Musk thinks it is to find and process lithium using sodium chloride; we are unsure how many cesium cycles long this podcast is, though.
We discuss the psychology behind investors’ current affinity for glamour stocks and why it may not end soon, how this relates to the Fed’s new inflation policy, and why Will loves lamp.
Will and Adam look to Jim, Rex, and Cosmo, collectively the “C(K)ramers”, for perspective on the Fed, market multiples, the shape of the recovery, and the Dunning-Kruger effect.
Escape from the labyrinth and explore why physics don’t comport with the Icarus myth, and how the same kind of first-order thinking is affecting markets, where certain sectors and companies are in rarified air.
Will and Adam discuss the increase in COVID cases and its implications for consumer behavior, the Japanification of the U.S. (and what it means for financial stocks and gold), a recent purchase for our investors in the electric vehicle/drone space, and investors burning themselves through day trading.
Formidable Asset Management's Will Brown and Adam Eagleston discuss the Odyssey investors have experienced in 2020, consumer trends associated with the re-opening of the economy, and the oddities we have seen with the behavior of certain stocks popular on Robinhood. Plus, a little mythology and history, as well as obligatory references to the shape of the recovery and associated chart crimes (we’re looking at you, CNBC, and that recent unemployment graphic).
Will and Adam offer their thoughts on unprecedented market and economic data in Episode 2 of the Tea and Crumpets podcast.
Formidable Asset Management's Will Brown and Adam Eagleston discuss the markets as we approach the end of April. The highs, the lows, and everything in between in Episode 1 of their Tea and Crumpets podcast.