Is now the time to go all in on U.S. stocks? Adam Johnson, Portfolio Manager of the Bullseye American Ingenuity Fund, shares his bullish outlook on the American market and economy, breaking down the economic drivers he believes will fuel growth, from Trump’s policies to innovation in AI. In this interview with Wealthion’s Andrew Brill, he reveals his top investment strategies, key stock picks, and the sectors he believes are best positioned for long-term alpha. With insights on everything from energy and tech to how today’s economy and Trump could shape 2025 markets, this is a must-watch for anyone looking to protect and grow their wealth. Find out why Adam is confident that the U.S. market’s best days are still ahead!
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Adam Johnson 0:00
It’s GDP growth, it’s full employment, it’s earnings growth, it’s the promise of an administration that will lower taxes, cut regulation and empower companies to find cheaper oil, which is a tax cut for everybody, right? I’m still all in on stocks.
Andrew Brill 0:24
The market continues on an upward trajectory. I’m your host, Andrew brill, we’ll talk about where it’s going and what to expect in the near future. I’d
Andrew Brill 0:37
like to welcome back someone who I always enjoy talking to Adam Johnson, who is the portfolio manager of the bullseye American ingenuity fund and author of the weekly Bullseye brief, which is an investor’s newsletter. Adam, welcome back. Glad to see you
Adam Johnson 0:51
later. Yeah, we got a lot to talk about today, so I’m very glad to be with you.
Andrew Brill 0:56
Well, I know that last time we spoke back in September, you hit the nail on the head, but we’ll, we’ll get to that, and we’ll talk about that. But I want to get your take, we have a new president. We have, you know, not unexpectedly, because, as James Carville said, I think during the Clinton years, it’s the economy stupid, and I think that a lot of people voted with their pocketbook and with how they’re actually doing, but I want to get your take on the present economy and and where you think it’s headed. Yeah,
Adam Johnson 1:26
well, let’s start with the economy, because that’s ultimately what it boils down to, as you point out, right? James Carville, it’s economy, stupid. GDP is growing. It’s growing somewhere between two and a half and 3% that’s consistent with the long term average, so that baseline is very positive. We also have very strong employment. There are a lot of people working. Granted, there have been a few more who’ve been laid off over the past several months. But, you know, unemployment is down around 4% that’s extremely low, which is good, because when people are making money, they are spending money, and when they’re spending money that’s generating sales for US companies, and that’s why we see earnings growth of somewhere between eight and 10% and I think actually that’s going to accelerate into next year. I think we’re going to see 10 to 12% earnings growth. So the macro backdrop is very positive from, you know, all the stuff we can actually measure, and then there’s the stuff we can’t quite measure, like what’s happening politically, and you know, very positive in that we now have an administration that is likely to cut taxes, an administration that is likely to cut regulations, and an administration that is likely to unleash drilling on federal land that makes cheaper oil more available. So all that stuff, even though we can’t quite quantify it, that’s directionally positive. So you add the stuff we can quantify with the stuff we can’t quite but we kind of think we can, and that argues for being long stopped. So I’m fully invested. I’ve done some more buying since the elections, and I think we’re going to see a strong run up into year end.
Andrew Brill 3:01
Now, I know that it’s interesting. You say that the GDP is growing, does it? Are we worried at all that it’s growing at that rate because of government spending? Okay,
Adam Johnson 3:12
so that’s a very interesting point. Andrew, you know, there’s all this talk about Elon Musk and Vivek Ramaswamy coming in and slashing inefficiency in government, and that will inevitably lower government expenditures. And yes, you’re right. Government expenditures are about a quarter of GDP gross domestic products. So you know, there is this notion that, hey, wait a minute, if the government stops spending enough, it actually could slow GDP growth. Yes, that is an absolutely fair argument. But I would also argue that that’s going to be offset by what I think will be tax cuts, and that means more money for people to spend. And actually two thirds of GDP is personal consumption. You know, people going out, buying stuff from cars to houses, clothes, dinners, out, insurance, doctors, expenditures, et cetera. So if the government is a quarter of GDP and the consumer is two thirds of GDP, by definition, the consumer matters more. And I think this administration is very focused on doing what’s best for consumers. So yes, you raise a valid point about not wanting to cut government spending too much, but I think there’s a far larger offset on the consumer side.
Andrew Brill 4:27
Interesting. You had mentioned unemployment. I was reading this morning that first time unemployment claims are down the lowest level since back in May. So that also plays into getting money into consumers hands, because if there’s less unemployment, that means there’s more people working, more people able to spend money. GDP should continue to grow, as you had pointed out,
Adam Johnson 4:50
yeah, yeah, exactly. And you know, while all of us enjoy talking about politics and political outcomes, what ultimately matters most is earnings. Dollars, and obviously, for me as a portfolio manager, and for my clients as people who are invested, and at this point, fully invested. So yeah, you just connect all these dots, and it’s all about earnings and earnings growth. And you know, some of the big themes, artificial intelligence wouldn’t, wouldn’t exactly be a surprise to anyone. But it’s not just, you know, buying Nvidia, it’s buying companies that create power. It’s even utilities, you know, are suddenly finding a bid, because they’re the ones who have to supply power for the data centers, where all these computers powered by NVIDIA chips are operating and consuming a great deal more electricity. So, you know, it’s also a company like DICOM, ticker dy, just a good old industrial that helps actually build data centers? It’s like the data centers themselves that you need, right? There’s this whole multiplier effect, not to mention the fact that every company is trying to figure out how to become an artificial intelligence company. Just as 10 years ago, every company had to figure out how to be an E commerce company, and five years ago, every company had to figure out how to be a cloud company, you know. So there are these, these big thematic movements that are that are creating very strong reasons to invest, and that’s what I’m trying to tap into as the portfolio manager of the American ingenuity foot. It’s
Andrew Brill 6:16
interesting. You mentioned power. I’ve asked a bunch of people about nuclear power, which, here in the United States, we kind of because of nuclear waste and all this stuff. I think there’s big, been some massive advancements here is nuclear power something we should be keeping an eye on. Look, Microsoft went and bought Three Mile Island, and that’s not far from where I grew up, and I remember some of the problems that we had there. But is nuclear power something that the United States, here in the States, will start getting back into?
Adam Johnson 6:48
I think so. I think the answer is yes, that we will start relying more on nuclear power. The thing is, it’s a very hard theme nuclear energy. It’s a very hard theme to invest in, because these plants take years to permit and then build. So it’s not as though you can buy a stock that has exposure to nuclear and say, Well, you know, things should kick in by next quarter. I mean, probably not, and you hope by next year, or the year after that, or the year after that. Now, some of my stocks are long cycle socks that I intend to own for many years, if I’m right, you know, they will double and triple earnings every few years, and the stocks will, you know, follow higher. But, yeah, nuclear is a very, very hard, very hard theme where you can try to make money. It’s a lot easier to make money in oil because there’s so many oil stocks. But, you know, the irony is that we may be going into a golden age of production, right? If, if the Trump administration loosens drilling on federal land, there’ll be access to more wells, but more access means more supply, which will lower the price. You know, that’s not necessarily good for the earnings of oil companies. So don’t buy, you know, an EOG, the greatest producer out there, or Chevron, I think the best run major simply because there’s going to be more oil production. It might actually hurt them in the long run. What you could do is buy an oil services company like a Halliburton or Schlumberger, though I prefer Halliburton, because those guys are paid to go in and drill on behalf of the companies that are producing it. So I would bet on on service companies, but I wouldn’t bet on producers, because I do think we’ll see lower oil prices, which, again, is good for consumers and that’s good for the economy and the market as a whole.
Andrew Brill 8:35
Are you concerned about your financial future or think your investments could be doing better? I’m Andrew brill, one of the hosts here on wealthion, and I’ve been there not sure my money was in the right places. It’s why I’ve gotten help from a financial advisor. Maybe it’s time you think more about your financial future or get a second opinion about your investments. We’ve made that process easy. Simply go to wealthion.com/free, to speak with one of wealthions, registered investment advisors for a free, no obligation portfolio review. Again, that’s wealthion.com/free I’m now less anxious and confident I can achieve the financial goals I’ve set for me and my family. And while I haven’t been I want to thank you for sending us some of your Bullseye briefs. And I want to tell everybody, if you haven’t read it and don’t subscribe to it, take a chance read Adams Bullseye brief, because the research is phenomenal. The hints at what you might be able to buy is phenomenal. And he’ll even give you a look into his own portfolio and what he’s watching, and it’s got a wealth of information. So the bullseye brief, Adam, again, thank you for for sending that to us, and it’s a really a wealth of information. Now, last we spoke back in September, and you were all in on stocks, and I you know, you hit the nail on the head. Stocks have gone up tremendously. We were in. Embarking on a rate cut at that point, 50 basis points. We’ve now lived through another 25 basis point cut, and the inflation numbers seem to have stuck where they were. Do you see more cuts coming? It seems like another 25 basis point cut is coming in December. Maybe I’ve read stuff that they may pump the brakes on that a little bit. But where do you see rate cuts coming? I know the new administration wants to goose the fed a little bit to bring interest rates down, but where do you see it going from here?
Adam Johnson 10:31
So I see another couple rates in the future, and I’ll tell you why I only see a couple and not more. So if you remember, you know, a year and a half ago, producer prices at one point peaked at 11.3% that’s sobering, right? Consumer prices peaked at 9.1 so 911 Call it whatever you like. The Fed’s target is two. So the Fed had to raise rates from effectively zero up to five and a half percent, just to try to clamp down on inflation. Well, the good news is inflation has effectively come down to somewhere between two and 3% depending upon how you want to measure it, whether it’s CPI, ppi, GDP, price index or personal consumption expenditures, those are the four measures of inflation. And in fact, if you average the four together, they’re 2.2% All right? So we were as high as nine to 11. We’re now at 2.2 the Fed’s target is two. We’re almost there. So it would make sense that the Fed would take back some of those rate cuts that went as high as five and a half. They took back 50 on the first round, they just took back another 25 right? So now we’re at 475 in December. I think we get to 450 okay, then we get into next year. It probably makes sense, as long as inflation stays down where it is, probably makes sense to cut another 25 and then another 50 as we get into the spring, and that’ll get us to about 4% but we’re not going back to zero, A, because we don’t need to. B, because that was inappropriate. That was simply a function of stoking the economy coming out of the lockdowns that were essential during COVID And so the pendulum had to swing one way, then it swung the other and now it’s sort of coming back to where it belongs. And then the final component of trying to, I’ll say, Guess, because, you know, no one really knows, right? No one really knows where rates are going. We can make an educated guess. But the other component is that it’s very possible that the Trump administration’s policies effectively cutting taxes, which gives people more money to spend, and raising tariffs, which, by definition, raises the prices of imports. It’s very possible that those two policies could actually stoke inflation. How much? It’s hard to say we can model it. You know, get 10 economists around a table, and you’ll get 10 different answers. So you sort of try and kind of, you know, go with the average, but it is possible that inflation will accelerate, you know, call it in the spring or maybe early summer, when some of that stuff becomes reality. And I think it will become reality. So yes, the Fed will stay flexible. And in fact, Jerome Powell, the chairman of the Fed, said as much at the Fed meeting that happened about a week and a half ago. So stay tuned. Yes, I think rates are going down. That’s good for stocks. But you know, the inflation picture, while much better than it was and practically back to 2% is something that is, you know, like cash flow, something that you know kind of moves from month to month, and we just need to be sensitive to it. And I certainly know that Jay Powell fed share is very sensitive to it, because he’s told us so.
Andrew Brill 13:52
And I a lot of the Fed governors have spoken since that meeting, and all of them pretty much say we’re dependent on the data. And if the data is showing what it’s showing, then maybe rate cuts. We’ll get a couple more, but they might slow after that. And, you know, also a good point that some of the policies are inflationary, so it’s, you know, it’s possible that could creep up. What about the dollar, Adam, you know, it’s pretty strong now, and it keeps getting stronger. Obviously, you know, Donald Trump wants to said he wants to weaken the dollar, but it gets keeps
Adam Johnson 14:24
getting stronger. Well, you know, the dollar is a barometer of confidence. I remember down at Princeton my econ 101, Prof Alan Blinder, former vice chairman of the Fed, and the guy who convinced me not to be a doctor, but instead an economics major. Here we are. He used to talk about the macho theory of exchange rates, which was, we want a strong dollar because we’re the best pound your chest. And in fact, every Treasury Secretary, going back to World War Two, has said, we affirm a strong dollar policy. And they say that for a couple of reasons, we issue a lot of debt. And so when the dollar is strong, people are. Willing to buy our debt, treasury bills, et cetera, and that helps fund the government. If the dollar were weak, that would mean that there’s inflation, and people wouldn’t necessarily want to buy our debt, and interest rates would go up. So there’s this kind of curious thing where you want the dollar to be strong, in the eyes of the world, you want it to be the reserve currency that just reinforces the US, as you know, the strongest, the strongest kid on the block, but it does make our exports more expensive to other nations. So that too. You know, the dollar is one of these things that you have to watch from day to day. You know, it’s not a fixed point. It moves moment to moment. It’s at highs right now for two reasons. One year highs. One because rates, have, you know, started to percolate. They were 350 and now they’re back to, you know, kind of 450 on the assumption that the bond market got ahead of itself, expecting too many rate cuts. And number two, because, I would argue that the the incoming Trump administration, administration is a strong handed, strong armed administration, and that’s good. It you know, might mean fewer wars or fewer things to worry about, less belligerent, less belligerents out of countries like China and North Korea and Iran. That’s positive. And the confidence in the US generally tends to manifest itself in dollars. People say, you know, there’s a lot of uncertainty in the rest of the world, but there’s a strong government coming in, and you know what? So we should probably put our money in dollars. It’s, it’s almost a safe haven trade. So I think that’s, in part, what’s fueling the strong dollar right now.
Andrew Brill 16:46
And I think the the last University of Michigan measure of consumer confidence is up. So that’s, that’s also a good sign. So what about earnings? Adam, we’re in the middle of earnings season. I know that Disney just came out their streaming business is profitable now, which is obviously a change. I know that the ingenuity fund has Disney in it. Nvidia is coming out next week, as we record this, actually on Thursday, but Nvidia is coming out next week. What What have you seen with earnings season? Any surprises? Anything that we should be worried about.
Adam Johnson 17:21
Well, earnings, I thought were going to grow double digits this past quarter, you know, the third quarter reporting season, that’s pretty much over. Now, turns out they didn’t. But, you know, they still grew 678, percent, sort of on average, which is consistent with the previous two quarters. So we’ve now had three quarters in a row of growth that’s somewhere around 678, percent. That’s good. It can be better. There’s room for improvement. And I think we will see improvement up to double digits when we get into the fourth quarter reporting season, and that will happen starting about the third week of January. I think we’ll see an acceleration of earnings into the spring. And so whereas earnings for the S, p5 100 are probably going to be around $250 for 2024 I think they’re going to accelerate to 280 to maybe $285 for 2025 you know, that’s positive. That’s the sort of 10 to 12% earnings growth that I am modeling, and I think many on the street are modeling, and it’s why people can justify going out and buying stocks at what is not an expensive multiple, but certainly a relatively optimistic multiple, the S P is trading right now at about 22 times earnings the the average for bull markets since World War Two. Well now let me say the average for bull market since 1990 is 17 to 22 times, maybe 23 you know, when you figure in periods when rates are coming down. So if we’re at 22 and the average is 17 to 23 you know, we’re going to be the point where you start to say, alright, that’s, you know, a robust valuation, if you then make the jump to well, but hang on, does it mean that we’re close to a bubble? I’d say no, not even close. Because in 2008 and 2002 we saw the S P go anywhere from 40 times to 70 times, so we’re still a long way from there. So no, we’re not in a bubble. You just have to recognize we are getting to a point where markets are pricing in 10 to 12% growth. And I think it’s important to be a stock picker. You can’t just blindly buy anything. That was last year, you could have bought anything and it was going to go up. And thank goodness, because, you know, in 2022 markets were down 30 to 35% so now you really have to be a stock picker. You got to know your companies. You got to know the earnings growth, and you’ve got to focus on quality. And that’s what I do on behalf of my subscribers. You know, I tell them I’m doing the. Work that they don’t have time to do. And saying, here are the, you know, 40 names we want to
Andrew Brill 20:03
own. And if you don’t follow Adam on Twitter, you should, because that s p analysis that you just gave me was in you did tweet about that. And I was wondering, you know, back in June, also we had, we had a guest who said, Oh, the S P is going to hit 6000 and I was like, really? Because at that point it was probably, it was, I think, about a 15% increase from where it was, maybe a 20% increase from where it was. And I was amazed, but he was dead on. It hit 6000 you think it’s and it’s not in a bubble? You think the S P continues to grow. Yeah,
Adam Johnson 20:41
I do. I mean, just, you know, put a 22 or 23 PE multiple on earnings of 280 or 285 bucks, and you get to somewhere around 6300 so, you know, I think the S P can continue to rise. And then you say, oh my gosh, but Adam, what if it gets to 6300 you sell everything? I say no, but at that point we become very discriminating, because, you know, if the S, p5, 100 goes up and sort of hits its target, it probably tends to sort of trade sideways. Now, stocks, individual stocks, can continue to to go up, but what you have to recognize is, if the market’s fully valued, you no longer have that tailwind. So you do have to be particularly aware of your own companies. And you can even make the argument that if you get to 6300, and and then, as we’ve seen over the past week, some of the names pop 1011, 12% on great earnings, it’s okay to sell a little bit. Maybe you say, You know what we’re gonna we’re gonna put 10% into our pocket. You know, if we’re 100% vested, just to sell 10% of every single position, put little cash in the pocket. There’s nothing wrong with having a little cash when the market’s fully valued. And so if it pulls back, you can redeploy it. But I also want to be clear, I don’t think we’re there yet. I am fully invested. I do think the S, P is going to rally into year end. I do think it will get up to 6300, in the near term. I mean, we’re 6000 now. So, you know, another 5% isn’t exactly, you know, a bold call, but, but I do, you know, I do think about whether I want to take a little money off the table in some of my names. I mean Coinbase, which is my proxy for crypto. You know, was down around 100 bucks not long ago. It’s over 300 you know, nothing goes up forever. We still have all our shares in Coinbase. But there may be a point at which I’ll, I’ll look at my Coinbase and say, Hmm, this thing has tripled in like nine months. You know what? Sell 10% so that’s that’s part of my calculation that will happen as we approach year end. But for now, I’m still fully invested, and
Andrew Brill 22:55
I like your, your philosophy of taking some money off the table, and again, in the bullseye brief, you you lay it out for your subscribers. Hey, look at this price. You should buy a little more. And at this price, you should take a little bit off the table, because it may continue to grow, but it may not. So take some off the table. Take some profits, maybe take your initial investment out of it, and continue to let it ride. So great advice and a great investment strategy. Yeah, thank
Adam Johnson 23:22
you. Well, you know, every person has a different sort of chemical makeup that you know causes you to respond differently to, you know, good news and bad news, and you know, risk is a part of that. So I have clients who have, as a buddy of mine, who’s a Navy pilot, likes to say, no apparent fear of death, and they just want to be long stocks 100% of the time. And if the market trades down, they’ll go on margin and borrow more to, you know, buy the dip. I have other clients who say, Well, you know, I’ve made all this money. I don’t want to lose it. I still want to grow, but I’d much rather just have most of my money in safe, dividend paying stocks or bonds or even government bonds, knowing that, you know, I’m going to earn four or 5% per month and and it lets me sleep at night. Totally fine. I get it. Most people have a little bit of each of those two sort of inclinations, and that’s good, too. You know, you want balance. So we, as I say, we all have different personalities, different chemical makeup, different risk tolerances and different ways of approaching how we like to manage our money. And the key is knowing who you are as person, and then finding someone who can help you recognize that vision, or if you’re lucky enough to be able to do it on your own, do it on your own. So
Andrew Brill 24:46
Adam, when last we spoke, you were all in on stocks. The we hadn’t started to cut rates yet, and a lot of that was baked into the market. Are you still all in on stock? Sounds like you’re still. All in on stocks. Are you still all in on stocks?
Adam Johnson 25:03
I’m still all in on stocks. I intend to maintain my 100% invested approach for the coming weeks and months, and maybe somewhere in the first quarter, as the market continues to rally, I’ll sort of wake up one morning and say, All right, let’s just lighten up a few things. But we’re not there yet. I’m all in for the moment.
Andrew Brill 25:27
So what is it earnings that’s driving the market? Is it hope for the future? Because we have a new president, what exactly is driving the market at this point? Do you think all
Adam Johnson 25:38
of the above? It’s GDP growth, it’s full employment, it’s earnings growth, it’s the promise of an administration that will lower taxes, cut regulation, and empower companies to find cheaper oil, which is a tax cut for everybody, right? If gasoline goes down and oil being an import for, you know, virtually every product out there. So as I tell people, there is a lot more to like than to fear. Yes, I know there are wars happening right now, from what’s happening in Israel to what’s happening in Ukraine, and that’s unsettling. Yes, I know there is belligerence coming out of Asia, specifically China and North Korea. They’re unpredictable, and we don’t exactly know where any of that’s going, especially Chinese aggression towards Taiwan, which produces two thirds of the world’s semiconductors, right? So, you know, there’s some unsettling things out there that we can’t quantify, but there are always unsettling things out there that we can’t quantify. So what you have to do is look at what you know and determine whether you’re comfortable with what you know and what the glide path would appear to be based upon what you know. And for me that is 3% GDP growth, 4% unemployment, 10% earnings growth. Those are hard numbers we can quantify that argues for being long stocks. And add to that, what we’ve talked about from the Trump administration about lower taxes, fewer regulations and drill, baby drill, and that is a very powerful tonic for being long stocks. It’s
Andrew Brill 27:17
interesting, they always say the stock market isn’t the economy, but it isn’t reflection, I believe, on the economy. When Trump first took office, the Dow was about 20,000 when he left office, it was 30,000 and now it’s around 42,000 Adam, is this sustainable? Is this going to continue now? Now Trump is back, so you know, you got a nice 33% jump from the first time he was in office. I don’t think we can expect that. Can
Adam Johnson 27:43
we? There was a time Andrew, when the Dow was 100 and then it went 2000 and it went to 2000 and so whether it’s at 40,000 or 41 or 42 there, there will be a time when the Dow is at 60,000 there will be a time when the Dow is at 80,000 there will be a time when the Dow is at 120,000 I don’t know how long it’ll take to get there, maybe 40 years, maybe 50 but the good news is that that growth happens over time, and you would much rather be exposed to growth than not. Stocks rise two days out of every three days. So I always tell people, think about time in the market, not timing the market. Now, if you need money next month or next year because you’re retiring, or if you big purchase, fine sell stocks, because in the short term, markets are volatile. They go up, they go down. But if you look at markets overall, across broad swaths of time, three to five years, they tend to rise, and they tend to rise, on average, somewhere around 12% that’s pretty good. So if, if you do nothing, if you know, if you’re 30 years old and you just put $1,000 a month into an S, P, E, T, F, or a triple Q’s, ETF. You know, 1000 bucks a month, you’re saving 12,000 year, and that thing compounds at 12% you know, you’re doubling your money every six years or so, and you’re adding more money to it. So all of a sudden, you know, you started doing this $1,000 a month at age 30, and by the time you get to 65 you say, Holy cow. You know, I’ve got several million dollars in the bank, and all I did was save 1000 bucks every month. But you did it every month for 35 years, and that’s the way to approach long term investing and creating long term security. I
Andrew Brill 29:39
think you just, there was a light bulb that just went off on some of our viewers. You know, some of our viewers head saying, Oh, wow, only 1000 bucks a month, and that’s what I where I can end up. And I hope that that’s, that’s exactly what happens. But I think that my grandkid will sit here interviewing your grandchild and say. 120,000 on the Dow, where is this going from here? So I think your point is correct. Adam, what are we watching these days? What sectors are we looking at? We know that there’s, you know, a new regime coming in, a new president coming in. I shouldn’t call it a regime. It’s a new president coming in. You know, what sectors are we looking at?
Adam Johnson 30:20
Well, actually, I would use the word regime, not for the President, but an investment regime, right, where I think we’re going to have a very attractive backdrop for stocks, if you want to talk about groups or sectors that play into a Trump administration, you know, focus on defense and border security. Company like Arrow environment. I don’t own it. Ticker, Ava, but I’m looking at it. They make drones. They just hover back and forth. You know, that’s one way to protect the wall. Certainly, we’re learning that Ukraine is using drones against Russia in its war. You know, a Lockheed Martin plays into that. So certainly security and border security and a strong military, that’s a Trump kind of thing, if you want to talk about deregulation, not just banks, the obvious, you know, beneficiary that, but you know, sort of new finance companies like Sofi, right, which was the first ever bank designed from the ground up to be internet only, or a company like block or square, you know, if you remember, a PayPal, you know, companies like this that are in digital payments, a coin base, the Trump administration appears to be crypto friendly, so lower regulation in the financial sector argues for owning financials, fewer rules on drilling, argues for owning the service companies, as I said, though earlier, don’t buy the producers because lower oil means they might actually make less so you know, there are a number of different sectors that We can talk about, artificial intelligence. We’ve already talked about core ingenuity. I think you need to own like Salesforce, like Palo Alto, networks for security, The Magnificent Seven, right? I mean, there are a lot of names to own that are very exciting. I don’t think consumer staples, you know, are very exciting. I wouldn’t be buying, you know, companies that produce food that’s kind of boring, agricultural stocks. You know, you’re just, you’re at that point, you know, you know you’re, you’re just betting on the price of corn going up. That’s not particularly compelling or exciting. Railroads, not particularly compelling or exciting. You know, buy stuff that that’s growing, right? That you know, where companies are creating new products or they are levered to growth in a more macro sense, that’s exciting. That’s that’s where I’m deploying money for people.
Andrew Brill 32:52
And when I speak to economists, they’re ringing the bell. They’re saying recessions coming, the world is ending. But when I speak to to you who is a stock picker, everything is exciting. Everything is great, and the market’s doing really well. Should we we were should we worry about a downturn? Should we be trying to protect ourselves a little bit? There
Adam Johnson 33:14
will be a downturn at some point. I can assure you there will be a recession at some point, but that point is not anywhere in the in the near term. So no, I understand that, that there are people who like to worry. I understand that there are other people who like to hear about people who are worrying because it makes them feel like they’re being smart and they’re getting ahead of something. And, you know, bears always sound smarter than bulls, because skeptics might see something that we don’t all of that is absolutely fair, and I get it, but I just see a lot more to like right now than to fear. So the short answer to your question is no,
Andrew Brill 33:53
human nature we all want to see sort of the little, the little dark side of certain things, even though we should be saying, no, no, this is great heading into Thanksgiving and then the end of the year, a lot of people sort of take some time off. What do we what are we looking at? What should we be taking care of towards the end of the year? Well,
Adam Johnson 34:12
take care of your tax situation. Recognize that there may be some changes coming up next year, if you haven’t already put money into your 401, K or your IRA, do that. You know you’ve got till year end, and that’s the best way to build wealth, because the government’s giving you a tax break to do it. Put together a budget for next year, and think about where you want to spend money, where you want to invest money, where you want to invest your time. Think about what matters, from family to security to financial security. I think year end is always a wonderful time to think about where you want to be and set some goals for next year. I certainly do it in my business. I do it in my personal life, and I think it’s just a healthy exercise that we can all do. And. And, you know, it doesn’t take that much time, you know, you can just think about these things on long walks, and it starts to take shape. I remember Daniel Kahneman won a Nobel Prize for some of the work he did and wrote a wonderful book called Thinking Fast and Slow. There are times when you need to think very quickly. Do you want to find a stock right now? It’s on the move you buy, or there are times when you say, let me get back to you on that. And being able to toggle back and forth between thinking fast and thinking slow is very healthy. And I would invite all of our viewers and listeners to think about how they can think fast and slow and improve their decision making incrementally for next year.
Andrew Brill 35:44
And you had you said you Coinbase is your your crypto sort of ETF. What do you think about crypto at this point? I know that the new president is pro crypto and stuff like that. Obviously, deregulation would help that. What do you think of crypto at this point?
Adam Johnson 35:59
I’ve never owned crypto, but I do like Coinbase, and it’s my proxy for the whole sector. I don’t know if our viewers necessarily realize that BlackRock, the largest money manager in the world, has a joint venture with Coinbase, such that when any of its clients, institutional or individual, need access to crypto markets. Coinbase handles it for them. So Coinbase is, you know, effectively, the Go To arm for the go to money manager of the world. That’s a pretty strong endorsement, and it’s one of the reasons why I’m longing,
Andrew Brill 36:35
and it’s if you individually, if you want to buy a cryptocurrency, that’s where you go to do it. For the most one, that’s where I did it. I didn’t invest a lot, but I had to get in on it. As you say, you see things going up, and you have to get in on it. It’s another interesting thing I read. And everybody’s, you know, timing the market. You’re saying, well, if something hits a new high, take a good look at it, because the chances are it’s going to hit another new high.
Adam Johnson 37:02
Yeah, yeah, new highs, but get new highs. You know, momentum is powerful, and this is a momentum market right now. There’s still people sitting on the sidelines. It’s not too late to get in. That’s why I’m fully invested. But, yeah, just embrace it. You know, people always feel like if something moved and they didn’t get the bottom. You know, I missed it. No, you didn’t miss it. Go buy it. Now. You know, no one is smart enough to buy the bottom and sell the top, so I’m generally very happy to make the middle 80% I’ll miss the first 10, and I’ll probably miss the last 10, but that that middle 80 is very powerful. You
Andrew Brill 37:40
know, last thing I was reading your newsletter, and I, as a kid, I used to watch the Jetsons, and when I read about Joby, I was like, this is right out of the Jetsons, but you’re this is a stock that you’re keeping an eye on. Oh, I
Adam Johnson 37:51
love this one. $5 $6 stock, actually, Joby aviation, J, O, B, y is the ticker. This is the leading company right now for the new market, whereby they are going to create air taxis, drones that carry five passengers. They have six rotors. They’re very quiet because they’re electric powered. They fly about 150 miles an hour, and they’re initially going to be used to transport people from city centers to airports. They’re going to debut in Dubai. They’re building the first terminals right now. They’re going to debut in Dubai. The middle of next year. The Air Force is already testing them. They’re really cool. I think Joby is going to be the Uber of the skies, and it’ll transform how we move around. I mean, think about it. You can take an Uber from midtown Manhattan out to JFK Airport, and it costs about 90 bucks and takes sometimes an hour and 15 minutes, or you’ll be able to go to the 33rd street heliport on the East River, jump in one of these drones. They’re so quiet that it’s the sound of rustling leads, so you barely even hear them, so they’re not a nuisance, and it’ll fly you to JFK in approximately seven minutes for the same price, about 100 bucks. It’ll land. They can recharge within five to 10 minutes and and then return. They’ll go back and forth. Ultimately, it’ll be more than just getting to and from the airport, because the range on these things is about 150 miles. So I think you’ll see short haul travel all over. In fact, one of the other markets is going to be Newport Beach, to LAX for our West Coast listeners. So it’s very exciting. Joby, five or $6 stock, very well capitalized. Partners include Delta, Toyota, South Korea, telecom. I mean, it’s really exciting. Intel, very exciting. What’s happening at Joby J O Lee, why?
Andrew Brill 39:43
It’s a, you know, I looked at I said, Well, this is the future of trap, not only travel, but owning a car. Someone’s going to soon own one of these things that can take them from New York City out to the Hamptons, or, you know, to go a certain distance in in a lot less time with that traffic,
Adam Johnson 39:59
lot less time.
Andrew Brill 39:59
Adam, where can we find you, other than the bullseye brief, which I already plugged, and I know you do your walk and talks on Instagram. Where else can we find you?
Adam Johnson 40:08
Yeah, well, the walk and talks, I post these, you know, 45 second videos a few times a week, Instagram or Twitter at AJ, Insight is my Twitter handle, Bullseye brief.com, is my investment letter. I publish every Sunday. I have a 45 day trial for 45 bucks, and I talk about all the positions, the buys, the sells, for that given week, news on the names, and then I highlight a new pick or a focus pick. And the money management business is bullseye. Ig.com, that’s Bullseye Investment Group, Bullseye ig.com, if you’re actually interested in in talking to me about managing money, which has grown out of my investment letter, people said, you know, I read your letter, but what if you just ran the money? So I’ve been very fortunate to grow with some wonderful, wonderful clients, and I’m thrilled to be able to be here with you as well. Andrew, so thank you
Andrew Brill 40:59
absolutely. Adam. Always great to talk to. I love our conversations. And have a great Thanksgiving, and we’ll have you back soon.
Adam Johnson 41:06
Great Thanks, Andrew.
Andrew Brill 41:07
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