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b'Recorded June 5, 2019
\\nVolatility Led by NASDAQ
\\nThere\'s been a lot of volatility in the stock market since I recorded my last podcast on Friday.\\xa0 In fact, on Monday, the tech stocks in particular got beaten up.\\xa0 The NASDAQ dropped by better than 150 points, led lower by the so-called FANG stocks (Facebook, Amazon, Netflix, Google).\\xa0 Google and Facebook, the biggest drop - I think it was something like 6-8%.\\xa0 Part of that had to do with the Justice Department investigating Google.
\\nEnlisting the Power of Government in the Marketplace
\\nOf course, I don\'t think that we should be involved at all in anti-trust.\\xa0 Almost all of the companies that have been broken up or that had been put through the ringer by the U.S. government achieved whatever type of market dominance they had based on just being good competitors, delivering the best quality at the lowest price. And government just came in and really what they were doing was advocating for competitors that were having a problem competing.\\xa0 It wasn\'t because the consumer was getting ripped off; in general the consumer was being rewarded with low prices and high quality.\\xa0 But companies that couldn\'t compete, since they couldn\'t win in the marketplace, enlisted the power of government to work for them.\\xa0 So government, really is not about preventing monopolies - they create monopolies. The government comes into a market and legally gives a company a monopoly and uses the power of government to make sure that nobody competes. This is all a bunch of nonsense that we need government to "keep the markets free".
\\nMoving Away from Risk
\\nBut, in general, if you look at what was happening to the markets on Monday, there was a huge movement from growth stocks, momentum stocks, speculative stocks, riskier stocks, to defensive stocks - value oriented stocks. The Dow Jones was actually positive on the day - it wasn\'t up a lot, but it was up, even though you had a 150 point drop in the NASDAQ. I think that is an important key, because this is something that needs to happen and it is long overdue, that investors start to get more defensive in anticipation of a weakening economy.
\\nDividend-Paying Stocks More Attractive
\\nYou have all of these high-multiple stocks, their P/E\'s are going to have to come down to earth.\\xa0 And, of course, people are looking at a slowing economy, they are looking at lower interest rates - they believe they are going to get lower interest rates, so it makes sense that dividend-paying stocks would be more attractive in a falling-rate environment.\\n\\nOur Sponsors:\\n* Check out Rosetta Stone and use my code TODAY for a great deal: https://www.rosettastone.com/ \\n\\nPrivacy & Opt-Out: https://redcircle.com/privacy'