Episode 185 - Market Reactions to the 2024 Election with Ross Roggensack of Oak City Consulting
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In this episode of the Faith Driven Investor podcast, hosts Richard Cunningham and John Coleman welcome special guest Ross Roggensack to break down the 2024 U.S. election results and explore their potential impact on the economy and markets. As President Trump begins his second term, the discussion delves into the implications of his policies on various sectors, from venture capital and private equity to foreign conflicts and inflation. The conversation also takes a introspective turn as the hosts reflect on the importance of humility and seeking God's guidance in both personal and professional life. Join us for a thought-provoking discussion that combines faith, finance, and the ever-changing political landscape.
Please note that the views expressed by the hosts and guests are their own and do not necessarily represent the opinions of Faith Driven Investor.
All opinions expressed on this podcast, including the team and guests, are solely their opinions. Host and guests may maintain positions in the companies and securities discussed. This podcast is for informational purposes only and should not be relied upon as specific investment advice for any individual or organization.
Episode Transcript
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Richard Cunningham: You're listening to Faith Driven Investor, a podcast that highlights voices from a growing movement of Christ, following investors who believe that God owns it all and cares deeply about the heart posture behind our stewardship. Thanks for listening.
Speaker 2: Hey everyone. All opinions expressed on this podcast, including the team and guests, are solely their opinions. Hosted guests may maintain positions in the companies of securities discussed, and this podcast is for informational purposes only and should not be relied upon as specific investment advice for any individual or organization. Thanks for listening.
Richard Cunningham: Welcome back, everybody, to another episode of the Faith Driven Investor podcast. It is the end of November 2024. We are talking marks on the markets and given that it's the end of November, we want to wish you and your loved ones a very happy Thanksgiving.
If you happened to catch this podcast on the other side of the Thanksgiving holiday, then wishing you a blessed start to your advent season. I've got John Colman in the podcast studio with me. John, we're talking markets. We're talking economy. Not sure if you heard there was an election earlier this month. And so we're going to kind of look at how things are responded to that. But as overjoyed and thrilled I am is to have you in the studio. We've got a very special guest with us today, don't we?
John Coleman: Yeah. We've got a frequent FDI contributor, maybe frequent Ross Roggensack who runs Oak City Consulting, a long time leader in the faith driven investing movement. Brilliant on markets. Just a great friend of mine, great friend of a lot of folks in the movement. And we're so privileged to have you on today. Ross. Thanks for coming.
Ross Roggensack: Well, thanks for letting me. I'm always glad to be here.
John Coleman: Always glad we knew you would be able to handle a very laid back topic. Like US elections, you know, where there are no emotions at play. So congrats on taking on such an easy podcast with.
Richard Cunningham: The wise sage. Well, guys, great to have you with us. So let's start there. Let's hit on that November 5th election. So we're coming up, we're recording this on Friday, the 22nd. This podcast will release during the week of Thanksgiving, so it'll be kind of roughly right around three weeks out.
Post-election, Trump won 76.1 million votes to 74.2 was Kamala Harris to Donald Trump in the popular vote. So he got that one. He won all seven key battleground states, winning the Electoral College. 312 to 226. The Senate race took out to 5347 in favor of the GOP. And while there's still three uncalled races in the House race, it looks like Republicans have 219 right now to the Democrats to 13.
So, guys, I want to start here is what happened in this election. How did this all kind of transpire and was this the outcome you saw coming? Were you surprised and maybe John will start with you on that.
John Coleman: Yeah. So I'd maybe put the election just in a little bit of historical context, at least on the Republican side. This is probably the biggest electoral victory for a president since George H.W. Bush in 1988.
So if you'll remember, you know, in 2000, President George W Bush, there was a disputed election for some period of time between he and Al Gore. It was incredibly close, one of the closest in history to that time in 2004, President Bush won in a bit more convincing fashion. He even had a slightly wider popular vote margin than President Trump did, although with 16 million fewer voters. But he had a smaller Electoral College margin.
And then, of course, President Trump's first victory back in 2016 was quite narrow and he lost the popular vote, won the Electoral College. And so for Republicans, at least, this is a mandate in the way that they interpret it, because this is the biggest electoral victory that a Republican presidential candidate has had since 1988.
What was behind that was a very broad based movement in the electorate. Some of these stats may be a bit outdated. Some of our friends in places like California have not been able to calculate votes entirely yet. And so I'll be talking from some stats I heard probably a week ago as some of the count on the West Coast was still ongoing, but effectively Trump gained ground versus 2020 in all but two states.
So 48 states moved in favor of President Trump among almost every demographic category. And of course, you can cut those in a variety of ways. Kamala Harris seemed to pick up ground among unmarried women. For example, the President Trump seemed to pick up ground amongst most other categories, including what was surprising to many people amongst minority communities in the US.
So Trump won one of the largest shares of the black male vote of any Republican in quite some time. He got a little more than 20% of the black male vote. He got nearly half of the Hispanic vote in the US, which has been not typical for Republican presidential candidates. And again, he won more margin in 48 states. They kind of moved his direction.
And so this really was an across the board pickup in electoral support for President Trump in almost every category and where he didn't pick up ground. There were issues at play, I think, like with unmarried women, where abortion was quite a big topic, you know, where there was just momentum for Democrats in that area.
And so I think you could say this was a very wide ranging victory for President Trump. That victory had tails. You know, famously, President Trump, the last few elections, Republicans have not gained ground in the way that they thought they would. The last election, there was supposed to be a red wave. A. Quote that didn't materialize.
And yet, in this election, President Trump now has a 53 vote majority in the Senate. As you noted, they'll have control of the House of Representatives by a pretty decent margin. And so this did look like a mandate to bring in a new mode of administration, I think, across the board in the federal government.
And I think there were a number of things that moved that. I think, one, just the economy is not where people want it to be. I think there's broad based dissatisfaction with inflation, for example, and just the cost of living. I think there were a series of cultural issues that were at play in the Trump campaign hit on those quite a lot with relation to a variety of hot button cultural topics.
Immigration was obviously a huge issue in this election because of the perceived mismanagement of that under the Biden administration and Kamala Harris's participation in that. And then a series of just desires about the economy generally.
I mean, the Biden administration and later the Harris campaign had endorsed things like an unrealized capital gains tax increase, taxation, etc., that I think a lot of people reacted negatively to. And so I think there were a number of issues working in his favor. And the truth is, when a sitting president is as unpopular as President Biden is, and when an economy is as weak as it is right now under this sitting administration, there's often a vote for change. And I think that materialized.
Richard Cunningham: Ross, what would you add to that from your vantage point?
Ross Roggensack: A couple of things. Just as a person who believes in God and the Bible. I think that we know that God's in control and that regardless of who won, even if Kamala had won, he would still be in control. He'd still be on the throne. So everything's going to be okay whichever side you run for.
I think I wasn't that surprised. I remember when the assassination attempt happened and he jumped up and did the fight, fight, fight thing. I looked at my wife and said, this election's over. You can't beat that. And just kind of thinking about I don't know if that's providential. I don't know if the hand of God was on him. I won't try to intercede on that.
But I do think that something was happening, and I think that it was. After that you kind of saw neutral, seemingly neutral people. Elon Musk and Joe Rogan and others kind of jumped in just because they saw, I think, what was happening and what needed to happen. And so I'm just really glad that he won the popular vote. That was a good. Wearing the last time when he won the electoral but didn't win the popular vote. And we you know, I think that's part of the reason the markets have been so giddy is that they're able to kind of put that tension behind it and just move on. So it's a new day. It's a fun day. And I'm glad.
John Coleman: One, the fact that the election, as you said, Ross, it was over that night. Right. Basically, I mean, if you stayed up late enough, you kind of knew what the presidential outcome was going to be. The House is still a bit up. And I do think that's been a good thing for the country. And I think it's been a good thing for markets that there hasn't been a disputed election at all in this case. And there's a clarity of the outcome.
And you could feel that. I mean, we'll look back on this. I can't wait for the books that are written about it. It's hard to almost process all that happened in the last three months. I mean, we had a sitting president replaced on the ticket of his own party mid campaign after the first presidential debate and then a new candidate put in place with no. Kind of subsequent primary system, etc.. I mean, there were just a lot of moving pieces at play here and it is nice to have a definitive outcome. I think if nothing else, no matter where you land at it outcome, I think it's good for the country right now and lets people kind of move forward with clarity.
Richard Cunningham: Yeah. So Trump's putting together his team and thank you guys for those insights and maybe it might be helpful to have one of you talk about maybe just the Senate confirmation process of Cabinet picks as we get into this.
But there's some kind of highlight names, like you've got this Department of Government Efficiency coming out with advisors like Ellen and Vivek Ramaswamy. Matt Gates was picked to be the attorney general, and now he has stepped aside, as it sounds like it was a distraction to the whole kind of Trump administration. And now it's Pam Bondi out of Florida, Matt Whitaker for Naito, Tulsi Gabbard for Director of National Intelligence. Marco Rubio is Secretary of State, RFK Jr for Secretary of Health and Human Services.
So you're starting to see a lot of these names come up and there's massive responses kind of in both directions as you see on them. But ultimately, what is the a strategy or mandate, John, is the word you used earlier, as you see with who Trump is putting around him to be a part of this administration?
John Coleman: Yeah, you know, it's not every pick is in place right now. And certainly there are some important picks, I think, remaining to be had. I know there have been some rumors today about the Department of Agriculture, for example, and what that might look like. I think there have been a few signals in the picks that he's made so far.
One is it does seem like he's picking folks who will shake up the existing system, which is what he promised during the campaign. I mean, to have Robert F Kennedy at Health and Human Services, Tulsi Gabbard at that DNI. Seth at the Department of Defense. And, you know, a variety of other picks, You can tell this is not an establishment cabinet in many ways and that they are looking to make dramatic changes.
And like you said, the DOJ's the Department of Government Efficiency with Vivek and Ellen is explicitly intended, I think, to be a signal that they're shaking things up. And that's very consistent with President Trump's campaign. Right. I mean, I think they ran on this and they said we are going to make dramatic and big changes. And I think what you're seeing is them coming through on that campaign promise to really make dramatically different picks and to do something different.
I think in the foreign policy realm, there have actually been a couple of signals you can pick up. One is my impression is that this is a very pro-Israel cabinet so far. You know, one of the big two conflicts in the world right now is Israel and Lebanon or Iran, however you want to position that conflict. And I think Elise Stefanik at the U.N. is a big defender of Israel. I think Mike Huckabee being ambassador to Israel is a signal. I think Marco Rubio has been a strong supporter of Israel at the State Department, the Ukraine war.
You know, Trump has promised to try and drive that to conclusion. And it strikes me that even apart from his VP pick, J.D. Vance, that the signals are there, that he'll do that. And yet, if you're a person who's worried about disruptions in the international order, I do think, for example, that Marco Rubio and Mike Waltz are extremely mature politicians, thoughtful people who you could expect to navigate those conflicts quite well.
And so I think there is a balance there on the international order front between folks who kind of know how these things are done and those who are intended to shake things up that hopefully portend a really thoughtful approach to the end of those conflicts, which is, you know, Trump has said he's going to end Ukraine on day one, which I think within the first 30 to 60 days is what he'll shoot for. I think he'll look to end the conflict in Israel. And it seems like he's going to try and make good on those promises.
You know, the other pick that's outstanding right now is the Treasury Department. At the time of this recording, there's been some back and forth on that because of Trump's trade policies. He put Howard Lutnick, who's a big supporter of his tariff policies in at Commerce. And then there's still a bit of an ongoing debate around Treasury, at least the last I looked in the news right now. And I think that will be an important signal. But overall, this is a cabinet that is looking to shake things up, I think. And it seems like he's really going to try and make good on that campaign promise. But Ross, what are you saying?
Ross Roggensack: He's shaking things up. All right. And I think that here Treasury movies between Kid Rock and Ted Nugent. There you go. You know, I think that who he's talking about for Treasury sounds really good. And I imagine for markets that will be important as well as whoever he puts at OMB, those are kind of the big things we're sort of watching. And certainly the names he's floating for Treasury probably are all good.
Richard Cunningham: Unpack that correlation a little bit, Ross. Why are those two positions in particular so key for kind of economic and market outlooks? Well.
Ross Roggensack: Treasury is just so important as it relates to especially a lot of what Trump talks about in terms of tariffs, etc.. And then just the way the Fed interacts with Treasury, it needs stability. He can't sort of take a flier on that when he's got to. I was joking in case anybody wasn't sure about ten. Nugent It would be fun, though, but I think that somebody like Kevin Warsh would calm markets. Understand that there's an adult in that seat and nothing crazy is going to happen. So I think that the market's really at this point probably could well be assured that at least somebody is. And that's probably maybe a reason for some of the rally the last couple of days as his name came out or the other studies mentioned. So it's. So far, so good.
Richard Cunningham: So let's go there, because all of this ties back to kind of underlying outcomes and markets and economy is this is the FDA I pod and Ross the point you've kind of made in the month response to the election.
It seems like markets generally are viewing Trump's policies as stimulatory less regulatory oversight. Prospect of lower taxes. You even saw things or particular kind of segments of the market really jumped. If you know, if the prospect of lower interest rates continues to take place, something like the Russell 2000, which is more of your small cap universe, continues to jump.
So a couple of quick numbers is S&P 500 is up roughly 25% on the year, 2% on the month. If we're looking at kind of November and just the response, the election, Russell, 2000 is up 18% on the year, 8% on the month. So significant jump. Nasdaq, which is, you know, maybe you're more tech oriented kind of concentration of 29% of the year. We know a lot of that has to do with the Magnificent Seven and just the way they've ripped
So markets and we're now here in public equities most particularly have seemed to be just positive in response to the election. Is that what you guys are kind of diagnosing as well?
Ross Roggensack: Yeah. I think certainly if you think about the 2016 election when he won and the market at least overnight was straight down and then straight up, and then we had a pretty wildly bullish environment until he was inaugurated. It feels similar. Some differences here and there, but certainly feels a lot like the last time he was elected.
And so I think there's some confidence in small cap U.S. based companies and probably in private equity and M&A in less regulation and more growth, less taxes. I mean, all those things are positive and especially with the House and the Senate, I think that there's some confidence that, you know, by the spring we'll have a tax bill done. I mean, things are going to happen fast, as I think certainly he learned and they all learned they got to get it done now or it won't get done.
So I think we'll see a lot of stuff happen and the markets about tomorrow, not today. And the markets are thinking about the summer or the fall when we're past those tax cuts and we're maybe thinking about what is the event going to do to cut government and maybe will the war in Russia be over and maybe, you know, all the kind of things that I think are forcing the market up right now?
John Coleman: Yeah, I would say it's not even a very partizan thing to say that the last administration, it proposed some things that were extremely negative for markets on capital gains taxation, unrealized capital gains tax there. FTC under the Biden administration has been extraordinarily restrictive. The DOJ had been aggressive, the SEC had been aggressive. There were a lot of very negative things for markets embedded in that.
I think I agree with Ross. I mean, a couple of the factors at play right now that markets love deregulation. I think we'll see a lot of cutting of regulation. I think markets like that, there's a decent chance the M&A markets open up under a new FTC commissioner, which would be really good for markets.
I think the chances that taxes go up dramatically, corporate taxes or personal income taxes or capital gains taxes have diminished quite a lot, you know, and that would have caused a sell off at the end of the year. I think if people thought that cap gains taxes were going up next year, people would have liquidated this year, which would have caused a sell off. And I think there's not the urgency around that right now.
And so I think in general, there is a much more business friendly environment at play right now and probably more pro-growth environment deregulation, you know, with hopefully a healthy attitude towards M&A markets, etc..
I think the one thing that might warrant some watching is the continued inflationary pressures in the economy, some of which is obviously outside of President Trump and his administration's control. The Fed has lowered rates, but that hasn't impacted a lot of our fixed income markets, mortgage rates, etc., because there is still a fear about inflation, I think in markets right now.
And if rates were to come down more significantly, we'd see more of a bump in small caps and mid-caps, we'd see more economic activity. People are looking for that. If Trump can end the foreign wars that are going on right now in Ukraine with Ukraine and Russia with Israel, I think that'll be good for markets.
And then the tariff policies, the big question mark probably, I think, you know, he's proposed a fairly aggressive approach towards tariffs in the United States towards other countries. And we just have to see how that materializes. It's been quite some time since that was a platform in a presidential election in the United States. And there are potentially some good things that are out there, potentially some challenging things that economically. And I think that's one area people will potentially be watching in the first few months.
Richard Cunningham: You mentioned a lot to unpack there, John, and want to be sure we kind of go line by line and under almost like the lens of let's play out the other side of this and kind of what are some of the negatives.
Although there's been a lot of optimism and positive response like. IPO and M&A markets are just low and have been very slow. And the hunger and the starvation of and the need for distributions is out there. I mean, the last three years have been some of the lowest since the kind of great financial crisis in eight and No. Nine in IPO and M&A markets thinking about like an asset class like VC and 2022 to 2024 combined.
There have been less distributions in the VC asset class than there were in 2019 alone. And you know, you think of these companies like a databricks or a stripe or, you know, plaid camp. All these folks have been waiting on the sidelines for that IPO. They just continue not to kind of come to fruition. So does a Trump administration help activate these markets as or even correlation there? What do you guys see there? Because there's just a necessity for these markets to pick up.
John Coleman: Yeah, I mean, Richard, just to emphasize one thing, you've said, you know, liquidity in private markets has been really challenging. I think, Ross, you've probably seen that venture's probably the most extreme example of that. That's true in private equity. It's true in some other categories. We just have not seen distributions coming out of funds. We have not seen companies selling the IPO. Markets have been slow and the M&A markets have been slow.
And again, part of that is just the position of the current FTC commissioner, Lina Khan, who's been very restrictive, I think, on M&A markets, particularly by larger companies. And so we haven't had the exits that would typically allow for distributions out of venture and private equity portfolios.
And because we've seen a bit of a downturn, at least up until about a year ago in the economy and a rise in interest rates, people have been trying to hold positions in funds for longer to squeeze the return out of them that they could they didn't want to sell when valuations were compressed or when they were down.
I think we're starting to see those come back independent even of the Trump election. I think we started to see valuations rise. Venture valuations have certainly started to creep up. And I think at some point you just have to start selling these things. You have to have an opening in M&A and IPOs. You can only sit on these positions for so long.
And so I think in particular, if the FTC's position towards M&A is a little bit looser next year and if people have a favorable view of the forward looking economy, which would push up valuations which are often predicated on a forward look at earnings in companies, which seems to be happening because of public equity markets, I think we could see much more activity in the new year, liquidating private equity and venture portfolios.
And I think it almost has to pick up at some point. Right. It's been a pretty anemic three years for liquidity and there's just so much pent up demand to create liquidity that it's difficult for me to imagine that continuing through the next year. Ross And what are you seeing?
Ross Roggensack: Yeah, I mean, some of it is just pent up demand, so I don't want to give Trump too much credit. I do think he might be in a position where it will get better. Some of it will be because of that. But, you know, in terms of negatives, you know, J.D. Vance has been a bit on Lina Khan's side and the FTC, and maybe there'll be a little bit of hesitancy, I'm not sure, in terms of wanting to break companies up or slow down that momentum.
But it does feel like the pent up demand and just where we are in the cycle, we should be entering a better season for Venture especially and probably for private just because of the way money flows are starting to go. So it's probably good timing for Trump, which is a lot of what a good presidency is, is just being in the seat at the right time sometimes or not at the wrong time, you know?
Richard Cunningham: Yeah, Ross, that's a great point. I think that's something we need to keep in mind is that markets are exchanging hundreds of billions of dollars of hands a day, and they're going to do that regardless of who's in the White House.
So we definitely don't want to give credit or take away credit to any to full an extent. While this helps kind of set the competitive landscape or the rules of play in a lot of ways, who's in the administration? Definitely appreciate it.
Ross Roggensack: Don't worry, we will take credit. Well, that's so true.
Richard Cunningham: Going on, let's get into, John, another one of the points that you unpacked and that was fed and rate cuts. You know, one of the things that I think kind of flew under the radar is on November 6th and seventh, there was a second rate cut in this kind of cutting cycle.
There was the massive one back in September. We've come down now to a range of 4 or 5 to 4.75. But you mentioned, John, there's still some inflationary pressures that is taking actions now. They've cut rates all the way up to 75 bips and kind of this period, we're still seeing a really high ten year treasury, though the spread on yields between risk free rates, you know, the US treasuries and what corporations are having to pay to borrow money is at a 17 year low, 26 year low on kind of credit grade bonds.
So where are you at as you look at kind of the Fed's policy, the inflation picture that we're looking at and maybe with the optimism that we're seeing overall, what could possibly break the system? Is there something in play here that we haven't hit on yet that could be a big sensitivity to all of this kind of forward looking optimism we are feeling?
John Coleman: Yeah, I'll be brief because I think Ross is more of a fixed income expert than I am. I would say yes. My impression is there is still fear of inflation in the system. There's a lack of certainty around what government spending is doing, for example, to that environment.
I know several people who believe, for example, that we have been in a mild recession apart from government spending, which is obviously deficit spending consistently right now, and that that's been kind of artificially inflating our view of how the economy is performing. And we've certainly seen that even within some of the businesses that we advise. You know that the last year has been a bit bumpier than it might look at a surface level in markets.
And so there's a little bit of uncertainty around that. I think people are also worried about the long term financial health of the US federal government, given the debts that we've accumulated in the reset of interest rates coming in the new year on those debts, which is going to take our payments, I think above $1 trillion annually in the new year.
And there's just no signs in the underlying economy that all the areas of inflation haven't totally come back to normalized rates. You know, I think the Fed, Ross, is still said they're targeting 2%, although they've been a little soft on that number to try and achieve the soft landing. And it doesn't seem that we are achieving that level right now.
And look, inflation is just notoriously hard to tame, right? Periods of inflation often lasts a little bit longer than you think. You can't clearly read when they're over all the time. And so I think markets have a tough time achieving a degree of certainty that those periods are over. And until that happens, and until people are comfortable with the direction of the economy, I think it's going to be very difficult to get rates in a in a series of places around the economy much lower. But Ross, I'll defer to your expertise in this area.
Ross Roggensack: Yeah, I'm not an expert. I'm just old. I'm not an expert. But I do think when the Fed cut in September by 50 and then 25 again in November, you know, we've seen rates much higher than even when they cut. And so it feels like there's a tension of maybe a chance that we're growing faster than what the Fed thinks. And so they're moving too quickly. So the bond market is trying to tell them to stop it because they're going to juice the economy too much to where we get inflation back.
Lately, there's been the bond vigilante kind of threat out there that if the Fed and the government just spends any more money, that we're just not going to buy bonds anymore. And so there's always that threat. I'm a little surprised since the election that we haven't seen the ten year come down in yield. I would have thought it might have just because that sort of bond vigilantes and would be shaken off a bit for a while because there would be some expectation that we would shrink government. Government is just so large. It's twice the size it was 15 years ago.
And I know John spends way too much time in Washington, and it gets bigger and richer every time you go, I'm sure. And we know where that money comes from. It comes from us. So it'll be interesting. I would expect the biggest risk in the market is that that if we see the ten year go to five or somewhere near there, that that would not be handled very well by the stock market, I don't think.
So that's sort of the the boogeyman out there is rates of rates can come down some more. That would help. But the longer they stay up here at 440 or so, they started to creep to five. That should be a warning sign to all of us that you should sit up and pay attention that maybe some bad things could happen, at least for a while.
John Coleman: I think almost certainly, Ros, you need to launch a podcast called Bond Vigilante at this point, or at least get a T-shirt.
Richard Cunningham: I'm in agreement.
John Coleman: Only appropriate.
Ross Roggensack: Now we'll get Ed Yardeni to teach, and he's the one right now is the one that came up.
Richard Cunningham: With some kid rock hair for Ross and a Bond vigilante t shirt would be would.
Ross Roggensack: Be the look that said that they threw.
Richard Cunningham: Up the shocker sign for all those at home. Man Let's go back to John. You mentioned one last thing, kind of like the caveat to all of what you're saying, and that is foreign conflict and just kind of the geopolitical scene, the two major wars.
Let's double click into that a little bit because I think that's another one of those hey, all of the optimism, kind of uniformity around House, Senate president kind of all in one direction. But here we have with these foreign conflicts that are pretty unpredictable and feel very fragile at the state. What thoughts do you guys have there? Russ, we'll start with you.
Ross Roggensack: Well, not to be too much of a Republican here, but what's happening right now in Russia with us approving the missiles that are being flown into Russia, that are missiles that are training is really dangerous. And I do think in this lame duck period, they need to calm this down or else we could have a very serious issue in Russia and in Ukraine if that doesn't reverse itself or at least if somebody doesn't calm the message because there's a lot of threatening language by Putin about nuclear weapons, that.
Is really scary. And we will forget about the stock market in a hurry if a nuclear bomb gets dropped in Ukraine. No doubt. So I don't really know what they're trying to achieve. It's scary and I don't know what they're trying to do. It's confusing to me. And a little bit frightening, actually.
John Coleman: Yeah. You know, this is an area where everything is pretty unpredictable. I mean, I can offer some of my thoughts on where I suspect we're headed. But the truth is with these I mean, international conflicts are very difficult to predict.
And, you know, first, as Christians, we just got to be. Any time there are wars at this scale, like what's happening in the Middle East, what's happening in Russia, in Ukraine, it's just a human tragedy. Right. I mean, the number of civilians who have died in both of those conflicts, the number of civilians who are still threatened, even the military personnel who are dying and are threatened. I mean, it's a human tragedy that that's happening. And I think, you know, all of our prayers, regardless of where we stand on the political resolution of those, are that that human cost can end, that people will stop dying, that we can find a resolution to these. And, you know, certainly we want to be sensitive to that as we're predicting things.
I'm actually reasonably bullish on a conclusion to those conflicts over the next year, and I'm reasonably bullish that we won't see other conflicts developed with nations like China which might pose a threat. And I'll voice why. The first is I do think that in both of the conflicts, Ukraine and Russia and Israel and again its neighbors, so Lebanon, Iran, you know, the Palestinian territories, the clear signal is that the new administration would like to actively in those conflicts.
I think with regards to the Israel conflict, there is a clear signal, the pro-Israeli stance among the administration, at least in the appointees we have so far. And I think the Trump administration's strong ties with places like Saudi Arabia, you know, Saudi Arabia has already signaled that they're willing to lower some of their standards for normalization of relations with Israel since President Trump won the election.
Are all signs that we could see that come to conclusion and Iran contained in the region a bit more, because if you had the Saudis and Israelis working together hand in hand with the American government, there are probably solutions that could be had to the ongoing conflict there. So I'm somewhat bullish that that will happen.
And then in Ukraine and Russia, I think both sides are legitimately exhausted with the conflict at the moment. Ross is right. Putin said some scary things. He revised his nuclear policy. Ukraine is now launching long range missiles into Russia. Russia recently launched a nuclear capable missile into Ukraine, even though it didn't have a nuclear warhead attached to it. Those are super threatening signals.
My hope is that those threatening signals are jockeying in advance of what they understand will be a strong push for a negotiated settlement in the first days of the Trump administration. And the question there is exactly what they'll agree to, the two big levers being how long won't Ukraine have to promise not to go in to Naito? And how long will Naito have to promise not to allow Ukraine in? Is it ten years? Is it 20 years? Is it longer? And then the second is obviously where the territorial lines set. Putin would love to freeze them where they are I think on the front, Ukraine would like to push those back and only give up something like Crimea, for example. And so that will become the process for debate. I do think there will be a settlement to that. I think Putin may not acknowledge this, but he would like to see an end to that conflict. It hasn't gone well for Russia, hasn't gone well for Ukraine. Both sides are probably in a place now where they're willing to talk with the right people at the table.
And then finally, I'm bullish. You know, some people still have a fear that conflict could escalate with China. And once again, I'm somewhat bullish that it won't. I think China's in a weaker domestic position than most outsiders recognize right now. I think their economy is a bit weaker. I think they just announced stimulus, I believe, over the course of the last week or two. They've got a debt problem. They've got a real estate problem. They've got a shrinking population.
And they've just witnessed what happened to Russia when it went into Ukraine, a conflict they thought would be easy, which has turned out not to be easy and quite embarrassing for the Russian state. It's hard for me to imagine without some sort of massive provocation, China, for example, invading Taiwan or something of that nature at this time.
So I'm somewhat bullish. We can get those conflicts under control next year and I'm hopeful we can obviously because of the human cost. But, you know, the caveat is these things are hard to predict, right? You don't know what these international actors are thinking. And so you can only hope for the best and develop policies you think you know, can drive those to conclusion.
Richard Cunningham: You know, we got a bond vigilante and a foreign policy writer on the podcast today. It's good to be wrong.
John Coleman: All of this stuff will be proven wrong by the end of next week. Richard.
Richard Cunningham: It's for the best part as you're on the record, so we'll be able to call you out right away and we'll. Yeah, Thank you guys for sharing that. It's been a thousand days plus now. And Ukraine, Russia and 400 plus Israel, Hamas. So as you've talked about, John, just the cost of life.
Ross Roggensack: 600,000 Ukrainians have died in this war, 600,000. Think about that number. Just amazing. That we know of.
Richard Cunningham: Well, maybe that's a good place to just kind of stop. Put a pin in the conversation and just say, Hey, for anyone listening that maybe is disheartened by the election outcome. Here's something like I was talking about the foreign conflict or on the other side of the coin is just overjoyed by the election outcome.
Let's get back to that kind of like eternal mindset, biblical perspective. We asked the question at the close of every podcast of What's the Lord been teaching you in and through His word lately? And so maybe in light of the subjects we've covered in just your time with the Lord, how would you process and kind of think about this? What encouragement would you guys offer? Ross, we'll start with you. John will close with you.
Ross Roggensack: Well, my church has been walking through Joshua. And a few weeks ago we ventured out to the Battle of Jericho, which wouldn't be encouraging to many. So I'm not going to go there. But just before the battle. Joshua is I guess he's meditating or praying and he looks up and there's a soldier in front of him with a strong sword.
And Joshua looks at him and says, Are you are you for us or against us? And this is the Lord now speaking to Trinity right in front of him. And the answer was no, which is not an answer. It's basically that's the wrong question.
And our pastor kind of asked us to think about in light of that, in the light of what we do in our work, oftentimes I want to go in a direction. I ask if the Lord is with me or against me. Am I going in the right direction? And our pastor kind of rephrased it and said, maybe we should be asking the Lord which direction should we go and not? Am I going in the right way? So maybe that's a good thing to think about as we welcome to the next season, is us just being quiet and asking, Lord, where are you going? You know, where are you going? Can I go with you? So that's sort of what I've been thinking about.
Richard Cunningham: And that's good, Ross. We've been processing through God's will and just call on my wife and I his life. Honestly, just lately just been processing the big questions I just got Where would you have us? And we keep coming back to the word will.
And what you just said remind me of first Thessalonians 516, which is rejoice, always pray, continually give thanks in all circumstances, for this is God's will for you in Christ Jesus. We want to ask those questions about right and wrong. Got you on this side, that side, and you just stops and says, Rejoice, pray, give thanks. That's my will for you. Kind of like you're saying, God, what direction would you take me in? John Coleman, Take us home.
John Coleman: Well, first, just let me know. I'm almost shocked. We got through an entire podcast right now without having to talk about cryptocurrencies. Given that Bitcoin is almost at 100,000. I know that's Ross's favorite topic because it's probably his heaviest asset allocation is is Bitcoin.
Ross Roggensack: So you're a wealthy man right now?
Richard Cunningham: Ross That's my fault for not bringing up crypto, but it has been rippin.
John Coleman: It has been good time in the crypto markets. You know, I have been thinking a lot over the last few days about humility. I heard the founder of Hello on a podcast recently talking about humility. They have some prayers for humility on the app. I've been using the Halo app actually to do daily devotionals and things like that, and they have some great prayers on humility.
And then I was actually watching a sneak peek of a TV show on Monday that I won't reveal that forthcoming from some friends of all of us here on the podcast. And there was a scene with the Prophet Samuel where he was talking to Saul and he talks about how when Saul was small in his own eyes, God made him great. But then when Saul started to believe his own story, him to fail to attribute God, obviously he was humbled and it's just helped to remind me constantly.
Like any time we start to feel on top of the world for anybody feeling on top of the world right now, you know, we need to remember God is in control and that we are subject to him and we should always seek humility. We should have humility. We should remember to give glory and credit to God. We shouldn't let the valleys be too deep or the peaks be too high.
Right? We should know that we're on a journey and that journey will have both suffering and triumphs. And we should just always be cautious in our dealings with ourselves and with others that we constantly give credit to God, that we treat others as better than ourselves, and that we as Christians are setting an example for how we treat others so that we communicate that message of humility and love that Jesus consistently gave us.
And it's only by doing so that we can ever truly achieve great things not for ourselves, but for others and for God. Right? And that's just really hit home for me over the course of the last week with a couple of messages I've seen.
It's an area I fall short all the time, and so it's something I have to keep in front of my eyes. You know, Ross is smiling way too big when I made that last comment about falling short on humility. But but it really is. I mean, you got to pray about it. You got to think about it. And I'm too tempted to give myself credit for stuff sometimes. And I think we all are. And, you know, as folks are feeling either great or bad right now, it's important that we all remember to put that in context of eternity and the role that we play here. For the God that we serve to fear.
Richard Cunningham: The Lord is the beginning of wisdom. I think humility is one of those great byproducts of wisdom. Ross Robinson of City Consulting, John Coleman of Sovereign's Capital Friends. This has been another episode of the Faith Driven Investor podcast. Wonderful to have you with us. Have a great Thanksgiving. Start your Advent season. We'll catch you next time.
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