Kingsview CIO Scott Martin on Fox Business Cavuto Live 5.6.23
Program: Cavuto Live
Station: Fox Business News
NEIL CAVUTO: Scott Martin, the Kingsview wealth management genius on this. You know, help me with this, Scott, because it was really a Jekyll and Hyde week for for bank stocks. I mean, one day they’re tumbling, the next day they’re up. I mean, just looking at PAC West, the the West Coast Regional Bank, I mean, that stock was down 78% on Thursday, up 82% on Friday all over the map. So I don’t think we’re out of this, but I’m just worried about how much this spreads.
SCOTT MARTIN: Yeah, it spreads, Neal. It spreads easily, as you could tell from Madison’s interview there. I mean, just the two fellows that were sitting down were using that word confidence. And that’s really where it starts and ends with respect to people leaving their money in the banks, putting their money in the banks. And I love how you put it, Neal, with respect to how the banks are having their days these days now, where it’s like a good day, a bad day, a so-so day, that’s kind of like my life. And unfortunately in banking, that is not a good life. So when you have those things going on in the marketplace and you see them, Neal reflected in the stock market. So the very bank where you have your your tried and true hard earned money that we’ve all worked our lives for and that bank might be going under, it might be being put in receivership by something else, you freak out.
CAVUTO: You know, and a lot of people who shouldn’t be freaking out are freaking out. Now, I’m not trying to say that is the making of a contagion, but I, I think I shared this story on Fox Business, which if you don’t get you should demand. But I digress. Relaying the idea that he’s at a regional bank a pretty well-off fellow not as well off as you but saying I want out of my bank because I just think I should be parking it in a big bank. And we’ve seen that happen. Jp morgan Chase now controls one out of five deposits, especially just scooping up first Republic. So ironically, the one thing we wanted to avoid after the financial meltdown, having banks too big to fail now they’re too big to ignore.
MARTIN: Too big to bail, too, because, I mean, that’s going to get to be a big number. Where can you imagine the government coming in? Right. And this, again, is not spreading any contagion or any fear, but it’s like, what if Jp morgan has trouble like, oh, my gosh, we’re going to be trillions of dollars. So, yes, I think that part of the aspect, Neal, of kind of reinstituting these these contagion like effects is almost like being human just to a just to a tee of of how we just get so wrapped up in the emotion of things when in reality, I mean, Neil, my group, I mean, we’ve been buying these banks this week. We bought us Bank on Thursday. We bought a little bit more of Comerica on Friday and we’ve been buying these banks. We’ve been looking at Tier one capital, Tier two capital, their percentage of deposits where their commercial real estate portfolios are, all those things, boys and girls that are fundamentals related to these banks, not emotion. And those things stand up very well at those two names I gave you. Yet the market was trashing these stocks all week and has trashed them all year.
CAVUTO: Real quickly, one of the things I learned in talking to Austan Goolsbee, of course, he was among those who voted unanimously to hike rates even in this environment, a quarter of a point. But I would imagine this bank situation is going to be a backdrop for future Fed meetings.
MARTIN: Yes, And I think that’s good because the Fed needs to pay attention to this thing. I mean, the Fed has kind of gone on their own track this whole way, whether it was night hiking, interest rates at first because inflation was transitory and now hiking them like crazy because inflation is out of control. So the Fed needs to be back in the game here, as does the FDIC, as does the Treasury Department, to make sure that everybody is on board here, to make sure that we fix these banks and help them through this crisis of confidence.
CAVUTO: Got it. My friend Scott Martin, great catching up with.