Kingsview CIO Scott Martin on Fox News Business Your World with Cavuto 2.14.23
Click here to listen to the full interview.
Program: Your World with Cavuto
Station: Fox Business News
PRESIDENT JOSEPH BIDEN: Inflation in America is continuing to come down. It’s fallen seven straight months with more to go. Food prices, the grocery store are coming down. Gas prices are down $1.60 their peak.
NEIL CAVUTO: All right. Gas prices, by the way, is still up about a buck 50 up from when the president took office. Be that as it may, the president taking note of the fact that for the seventh month in a row, inflation at the retail level, the consumer level did fall for the seventh straight month, but it is still very, very high and it is well above where the Federal Reserve wants it to be. The Federal Reserve, we’re told, is going to cool it on raising rates and slowing down. Only when you get that inflation down to 2%, that’s about 4.4% to go from these levels, which could take a while. Scott Martin At Kingsview Asset Management, I think it could take a while, quite a while.
SCOTT MARTIN: Maybe forever. Neal. And listen, things feel better. I think the president is partly right. Things are improving. It’s when you come from 9% inflation and you go down to six as we are now. My goodness. I mean, that’s a slice by any mathematician’s pace by about 33%. But we were, to your point in the lead out there at 2% at one point. So it does feel difficult. Things like meat, egg prices, apparel, I mean, imagine how much this get up cost me today, Neil, are certainly off the charts. Rents and home prices too for a while there man are difficult for the consumer that’s living, say paycheck to paycheck or living on a stringent budget. So the way I guess I think about it is that inflation is getting better. It’s not great, but certainly the way the economy is growing nowadays at least tells me that things are likely to get better than they are worse going forward when it comes to these numbers that we’re paying at the pump and certainly in the stores and in the grocery stores as well.
CAVUTO: And, you know, and you and I have chatted about this before the administration goes back to the job situation, which remains strong in the latest month, more than, you know, 500,000 finding, finding work. And that’s a steady trend and shows the strength Now, inherent is that, though, is that the consumer still has some oomph and they’re still spending. And I’m not saying they’re price resistant, but so far they’re dealing with this. How long you think that lasts?
MARTIN: Hopefully long, Because here’s the weird thing about where the Fed’s kind of approaches, Neil, on this and slowing down the economy, maybe crushing the jobs market, I’m not sure if that’s so good. I think one of the problems that we have with this inflationary scenario is that it’s not so much demand driven, my friend, it’s supply driven. And so what we actually need is more workers out there making more stuff to deliver the goods to folks, because that will actually lower the prices because there will be more supply. And make no doubt, I mean, inflation, the way that it probably should be viewed is probably the worst thing to happen to the consumer. Since Paris Hilton came out with her debut music album, which says a lot because stars are blind to one of my favorite songs of all time. But it just tells you how difficult in this stringent economy, how tough it is to make more money in this economy. If you’re paying so much for just day to day goods and services, as we all are.
CAVUTO: You were working way too hard, my friend. But let me ask you finally.
MARTIN: I was just listening to her song.
CAVUTO: I understand. I understand. No, Adele in there. That’s fine. That’s fine. We’ll talk about that another time.
MARTIN: She’s innocent.
CAVUTO: The Federal Reserve looks at this and says, We’ve still got our work cut out for us. We still have to keep hiking. Maybe not as aggressively, but certainly longer than a lot of people hope. I’m wondering if that is a factor for people who are looking at this market and saying, wait a minute, I thought we were back in the green, which we still are in the aggregate for these averages, or is this going to begin to really weigh?
MARTIN: Yeah. The good old days of zero interest rate policy. Neal. I think the Fed is just jawboning. I think folks that are waiting for the Fed to say everything’s clear. We’re going to stop there waiting too long, as we’ve talked about on, say, on FBN, on Fox Business Coast to Coast Neil CAVUTO Show. It’s like we’ve talked about how the market will get it demanded. If you don’t get it very good, the market will preempt that period. Neil They will preempt the fact that the Fed has done so. The Fed is going to talk tough, maybe even all year, but they will stop hiking interest rates sooner than we think, and therefore, opening the door for this market to keep going up this year, my friend, and rates to keep going down.
CAVUTO: Well put. We shall see. Always good seeing you, Scott. Thank you very much.
MARTIN: See you,
CAVUTO: Scott Martin, An uncanny read of these markets. The check is in the mail to him, too.