WEBVTT

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Welcome to Quartz Smart
Investing. I'm Merrill Brown.

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Our guest today is David Dietz,

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Managing Principal and Senior Investment
Strategist at Peapack Private Wealth

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Management. David, thank you for
joining us for a second time.

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Merrill, It's a pleasure to be with you.

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We're wrapping up August this week,

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a poor month for stocks and the
market's worst month of the year,

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at least as of now. September is
typically a very weak month for stocks.

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Are we in for a rough rest of 2023?

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Well, if history's any guide,
September could be choppy.

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They look at the average annual return
for each month of the year over the last

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hundred years. September is the
worst average annual return.

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Negative 1.1% is the only month of
the year where historically it's been

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negative. The real
question, of course, is why.

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And the answer is?

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And the answer is,

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so we don't invest based
on a single calendar month

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because we're not quite sure what the
answer is. I can give you some guesses.

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One thing, of course,

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is we're at the end of Q3 so we've
had the earnings reports from

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the second quarter. We're going
to get Q3 earnings in October.

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So there's a bit of an
information gap. As we all know,

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markets hate uncertainty.

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They don't know what these
companies are going to report,

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so that could cause some money
to stay on the sidelines.

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And the S&P has pulled
back almost 4%. Now,

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what do you imagine the rest of
the year holds for the S&P 500?

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So we think we'll be higher
by the year, but I think what.

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By the end of the year?

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By the end of the year.

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But we think investors really need to be
watching inflation and interest rates.

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Inflation ultimately drives interest
rates because interest rates are going to

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move to reflect what the
inflationary expectations are. Now,

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the good news on inflation,

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we've seen about 12 months in a
row where there's better results.

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So we're in a much better position
than we were a year ago. Of course,

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the question is,

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do we continue with that trend or
did something throw us off kilter?

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And of course, interest rates are

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driven a lot by the Federal Reserve,

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and they don't know exactly
what they're going to do.

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They're going to be data dependent.

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But I think all observers will say
they're in the late innings of this rate

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hiking campaign. And so if
inflation continues to come down,

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interest rates don't go any higher.

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Perhaps there's a forecast
for a rate cut by next spring.

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I think that's good news for investors.

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Next,

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David Dietz on whether it's
time to rethink portfolio
dependence on big tech and

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a couple of stock tips.