[00:00:00] As salamu alaykum everyone. I hope you're doing well. Today is Friday, September 13th. And as I mentioned yesterday we do have a liftoff with assets across the board here. We got another piece of really positive news today. We'll talk about that. And we'll talk about basically the happenings in the market.

I'll talk about Adobe today. Down close to 10 percent shaved close to 25 billion off of its market cap. We'll talk about perhaps there is a larger trend there that investors need to be aware of. If you enjoyed these videos, make sure to leave a like, and I really appreciate that. So let's get right into it guys.

Today the S and P. Dow Jones was up close to 300 points. It was actually at one point up 400 points. But we got a really positive reaction today to the major economic data of the day, which was the consumer [00:01:00] sentiment report we basically had. Another month of rising consumer sentiment and expectations for inflation to be coming down over the next year.

If you look at the people surveyed people are noticing lower prices. I spoke about this a bit, earlier this week we actually had in our discord community. A member reporting lower experiencing lower prices and cooling inflation and a one year inflation expectations are now down to the lowest since 2020.

That's that black line you can see on the bottom part of the graph. This is consumer one year inflation expectations. We haven't seen this low. Of an expectation since 2020. So this is really good, really positive. And it reflected itself in a big way in the expectations for next [00:02:00] week's rate cut.

So now the. And this is fluctuating every day. I did not expect consumer sentiment report to have this much of an impact on the market's expectations for what the fed is going to do. I just, I still think a 25 base point cut is. Is expected but at least probabilities right now, the market is assigning only 55 percent chance of a 25 basis point cut and a 40 45%, a chance of a 50 basis point cut yesterday, only yesterday that possibility was 28%.

So it's oscillating every day here. But. Overall, this is good for risk assets and you can see that in perhaps the bellwether for risk assets. So we have Bitcoin 59, 400 today, only five days ago we were talking about 54, 000, [00:03:00] actually it reached to 52, 000 last Friday. We had a really strong rebound.

Really pays to be. Bullish when other people are bearish and, the market continues to prove that every time you start sensing panic in the market, that's when you should start being greedy. And if you look at Bitcoin, it's the price movement is rather reminiscent of what we had last year.

Last year. Q3 2023 trading within 30 to 35 percent range for several months, retested support level multiple times. That's what we did this year. In Q2 Q3 of 2023, BTC consolidated for 220 plus days before breakout. Right now, Bitcoin is in consolidation phase for 195 days. So if history were to repeat [00:04:00] exactly, we're just a few days away from breakout.

And then I think once we get breakout, we'll go much higher. The other sort of main impact on markets today are the. Polling results. We saw Trump came out with, I think a good idea, which is to not tax people for overtime. And so someone's working overtime. Then I think it's, it makes, I don't think they should be, I think they should be rewarded if anything.

As opposed to tax. So if that's what, if they, if the object of the economic policy is to encourage people to produce more than over time, shouldn't be taxed. In fact, income shouldn't be taxed at all. It's only idle wealth that should be taxed. And this is what we see in the rulings on the cat. Only idle wealth is taxed.

Income is not taxed. [00:05:00] So they should extend the tax free overtime to just regular income. I think that would be a great idea. But Trump is saying, hey, let's not tax over overtime. So there are some decent ideas that are coming out of the Republican camp. Whereas with Kamala and her camp, every time she comes up with an idea, it's worse than the one before it.

Whether it's taxing unrealized capital gains or just helicopter money. Dropping, 25, 000 on everyone who, wants to buy a house for the first time. Basically the houses, the number of houses are the same. You've done nothing for supply, but demand now has more money to deal with.

So what's that going to do? It's going to raise the cost of everything. So it seems like the party with the better [00:06:00] ideas is the Republican party right now. And I know I shouldn't be political and, we don't want to alienate anyone, but that's my opinion. I think the party with better ideas is the Republican party as of today.

The economic policies that are being proposed by the Democrats will be, I think, very damaging to the economy. Now, if we look at something that may be supporting the recent uptick in asset prices, the recent rebound in the market are, is the Improving numbers for Trump post debate. So the day of the debate.

This is Rasmussen reports. So we can see leading up to the debate, which was on September 10th Trump was, they were for the most part, Trump was in the lead. So for example, September 5th, 52, 46 September 8th, 49, 46 for Trump for [00:07:00] September 9th, 47, 47. September 10th, 51, 46 for Trump. But then September 11th, it was 48 48.

So people were saying Kamala won the debate. Yesterday, the gap widened again. So we're at a 50, 44 for Trump. So his odds of winning have improved, over the last 24, 48 hours. So this may be impacting the markets. It's very tough to tell, but I do think that Trump. And his policies would be better for the markets.

A win for him would be better for the markets than if Kamala were to win, at least the interpretation of the investors and their sentiment would be more bullish on risk assets in the event of a, Trump presidency. Now, in terms [00:08:00] of some of the swing states that Trump has to win in order to win the presidency, his lead is actually a widening.

So Trump has surged in the Midwest, dwarfs past performances. So he has more of a lead now than he did. In 2020 and in 2016, and some of these very key swing States. So new Paul firings, Trump is plus 11 over Harris in the Midwest, higher than any of his prior elections. The region is notably home to crucial swing States like Wisconsin and Michigan.

So if you're looking at 2024, you have Trump at. 54 percent Harris at 43, 2016, which was the year that he won the presidency. The split was 49 to versus [00:09:00] 44, 9 44. 9%. That is 49. 2% in favor of Trump. Difference was 5 percentage points. Whereas now the difference is a full 11 percentage points.

So maybe the market is liking that stuff to say but I think it's plausible given the announced policies of each side. Now let's talk about Adobe. The reason why I want to talk about it is the following. I think that a lot of behemoths. Software as a service companies are going to be killed because of AI and whether Adobe survives in the next.

period or thrives will depend entirely on if it figures out how to monetize AI in a way that is better than its competition. We're already seeing open AI, other image [00:10:00] generation softwares start doing the things that normally people would do with Adobe, such as, manipulating images and generating images.

And it's doing it at a much faster and more accessible rate than, Adobe's traditional bread and butter. Software can, and now Adobe has, been investing heavily in AI, but It is, the verdict's still out regarding, is it going to maintain a dominant position or not with regards to the, video and image curation, editing, all of that stuff, which have been its bread and butter for years now, the landscape is shifting, changing in a big way.[00:11:00] 

And perhaps, the industry is changing faster than I've seen, any industry change. So this is very competitive. It's a very high risk position to be in. Now, Adobe is a behemoth in terms of market cap. And when you look at their financials, they reported they report, so the reason why they're down is that their guidance was less than expected.

I don't think, guidance alone can explain shaving 25 billion off of their market cap. The difference in guidance was, less than a billion in terms of, next quarter's revenue. Perhaps investors are nervous about the encroachment of other AI projects on Adobe's main business.

If you look at the financials for this company, the financials are good and the valuation is not unreasonable. So if you look at the [00:12:00] price to earnings ratio, so this is trailing, so 47 close to 50, if you look at forward, it's close to 30, not unreasonable considering net income. The change is up. So the growth is up 21%.

That's not unreasonable at all. If you're asking Peter Lynch, you'd probably want to PE closer to 20, then a forward PE closer to 20, then or if you're looking well he would probably say that, depending on the growth projections for this company. If the growth projections were, another 20 percent over the next 12 months, then he'd like to see the forward PEB at 20, as opposed to 30.

But there perhaps there's some overvaluation here, but I don't think it's egregious. I've seen much worse. But the, I think reason for the drop, as I mentioned is people are nervous about how this company is going to fare. And they, In a new economy where, you know, a lot of what it did, a [00:13:00] lot of what it charged for, it can be done by AI, it can be done by a command prompt.

You don't really have to learn all of these tools that Adobe has spent decades perfecting. So it's really important as investors to keep your tap dancing shoes on, make sure you understand where the market is going, where the industry is going. What are the trends because no, Company is safe, whether it's sub 1 billion in market cap or above a hundred billion dollars in market cap.

These things can change very quickly unless you have a management that's really flexible, really adaptable, can bite the investors. The investors can get bit in a big way. Net profit margin, you're talking 30%. That's good. I typically won't consider something if the net profit margin is 10% or lower, but at [00:14:00] 30%, that's not bad.

And direction is positive. It's a, if you're just looking at the quantitative aspects of this company it's good. There's, especially for a company at size, it's doing well, but the qualitative aspects, there's a lot of question marks around that. And I've been asked to analyze Adobe before.

So that's my quick take on that. And that's why I haven't really bought Adobe. So let's go to a question very quickly. Abdullah says, Salam alaikum. Or can do you recommend any physical silver ETFs? Maybe you can put that in our discord Abdullah. I don't have one off the top of my head. I don't really invest in silver.

It doesn't excite me at all. But if you put that in our discord we'll check it out for you. Inshallah. Chocolate says, Salam. Chocolate. Nice to see you as always. Tuscane Abdullah. I know. Oh, Tuscany is giving you an answer, Abdullah. Hopefully that's interesting and useful. Redman [00:15:00] says Bitcoin.

Enough said Redman. Rashad says, Salamu Alaykum. I remembered you the other day when I was looking up Alan Eichmann predicting Harris. In the office this election. Interesting times, indeed, to say the least. Yeah, anything can happen. I honestly

yeah, I wouldn't be surprised. This election is still I think at this point, a toss up. I do think that the policies, as I mentioned, proposed by Trump make more sense currently than the policies proposed by Harris. I think that the more money is kept in the hands of individual voters, in the hands of citizens, the better.

I think government, for the most part, is less efficient than the private sector. And I also think that, the deficits that the U. S. government is running are unsustainable. So [00:16:00] the candidate that is proposing limiting the size of government, reducing it, putting more money in the hands of citizenry, I think will be better for the economy, for the country and better for investments generally.

So currently, I think That candidate is the Republican candidate and Harris is policies would be counterproductive really. So with that guys I hope you enjoyed this live, do leave a and hit the notification bell. When I go live next until next time, make Assalamualaikum and peace be upon you all.