WARNING Stop Buying Magnificent 7 Stocks Until You Watch This (Rookies vs Veterans)

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2:32If your best finance people are doing expense reports, chasing receipts, or spending time on month-end close, it's time to get Brex AF, a gentic finance that eliminates that work before it starts. Learn more at Brex.com slash AF. Is this the best time to buy elite tech stocks on sale? yes every every month is uh more important than a month and i'll talk about it invest fest and stock club best months to buy i'll give you that um in this environment in which we're in because like in post dot-com crash post obama we had the quantitative easing effect where the interest rates were so low that it drove the market up we're in a different kind of quantitative easing while the returns are so high you can't afford because of inflation to have your money on the side and that's the other part that no one's really talking about is like the capital has to be deployed because the cost of missing out is too high go ahead because i actually got from black rock so let me ask you because you're you're an expert and when it comes to technology stocks um at one point ibm was the king of technology IBM's not a dead company.

3:49They're not elite. Their stock is not elite. So we're looking at Microsoft being stagnant for a long time. All of these types of companies. Microsoft? Two years. That's not a long time. That's not a long time. Relative. Well, last year was at$458. Relatively speaking. I'm saying last year was at$458. Okay. Two-year chart is negative. Two years ago, Microsoft was at$448. Right now, it's at$400. so two years is less than what it was two years ago today two years ago today it was $48 higher two years ago today it was higher than what it is now while in that same time we've seen all of these newer technology companies go hyperbolicly crazy so okay at some point in time even the greatest player of all time starts to decline.

4:45So are we looking at a new wave? We're saying buy tech stocks. It's always a good time to buy tech stocks. Okay. Are the new class of tech stocks taking the place of the old class of tech stocks? Because the whole point of investing in the MAG7 tech stocks was you get out of normal returns. But I was never a MAG7 investor. Okay. Just taking two tech. to tech right yeah apple amazon you're getting out of normal returns the last few years the last few years you got less than normal returns it depends on what price you bought in in general they've underperformed they've underperformed the the major tech companies have underperformed the newer superstars in the space or emerging superstars in the space is it what about that what's the question people are asking the question is it time to say okay i'm still investing in tech yeah but i'm gonna invest in in the rookies i'm gonna invest in a two-year third instead of investing in a 10-15 year veteran i thought you said okay i want to i want to prioritize mu sandus i want to i want to go with the spacex i want to go with the newer the new breed because I feel like in 10 years, this is going to be the new MAG-7.

6:08And they're trying to frame that already now with mangoes. Right. They got an acronym for it. The answer is it's a great question, by the way. I misunderstood it at first, but I got it. I get this every day. Rookies versus vets.

6:25You have to do what owners do. Take me out of it. Do what owners do. You have to layer your team with both. The answer isn't either or. Kudos to Fertitta and Kiota. You know, I mean, anytime I got to the Rockets game, got a little chance to have a little powwow. The layering of new assets in real estate, business, equities, venture. Shout out to our guy. I don't know if we wanted to mention his name, but he'd be at InvestFest. You have to layer them together like Jenga pieces. To me, I always call it a totem pole. You got a totem pole in trading and same in investing. So you may restructure like Apple still hit an all time high.

7:10Microsoft is lagging behind. But even for Stock Club. That deep dip they had, like I called that and we like most of the people in Stock Club are up even if they got in this year based on price. So if you have a slot for eight, you need to do four new ones and four old ones. But you also have to know the new ones that are going to thrive in two years versus they were. It's a bunch of people who were supposed to be Jordan. Injuries happening. They didn't have the stick-to-itiveness. And we can see it in the CEOs. I think Microsoft and Meta have been beat up unfavorably. But I think in the long term, they'll be okay.

7:53And then, of course, new players have come in and gotten high returns. Some of these companies that have gotten high returns over a year or two, they won't get high returns next year. So you have to know which. But the answer is to do what the owner does. And you have to have both. You have to have both. I'm dealing with this every day. It depends on how much money you like for me. If you're investing hundreds of thousands of millions into the market. you have to lean on a side of conservatism versus if you're starting off trying to get to your first hundred if you're trying to get to your first hundred put all the money on the rookies but if you have a lot more money to lose you're gonna have because i've also gotten them calls where it's like yo i bet on this so i got on this two times levered this and now i'm down three and a half million why the hell you do that well i wanted to take this from three to six or three to eight it's moving different you gotta be careful you gotta be careful yeah it's it's tough man you you have to do both i think the most important thing is build a foundation and because i just got a text i i leave them anonymous they're like yo sure i just sold nvidia um and i'm like all right i understand it they're looking at companies like micron they're looking at a sand disc they're even looking like at an arm recently and they're saying those companies are moving faster they're not a trillion dollar companies yet micron is sandisk isn't arm isn't but they have the potential to get there and so that point is fair I get that way and I understand people want to have growth but you should also want to have your foundation because at some point if you look at Nvidia and you look at a Microsoft for meta the reason that they have pulled back is for the same thing because they're saying you are spending and you are spending for a build-out that we haven't been able to put a return on yet.

9:49But then they believe the numbers are spaces. Here's the part. Here's the part. Here's the part. The companies that they're spending with are the rookies that you're buying. Yes. So the reason that Micron's running is because Jensen said in 2022, look, we're going to need memories. This is Jason. This is Jalen Brunson thing. I'm going to give up some of my capital. The reason that Caterpillar runs is because we got to figure out we need energy. The reason that GEV runs, hey, we got energy for these data centers. And so at some point, right, and we're not here yet, the revenue that they spent with those companies will slow down.

10:27And the profitability of the companies that spent will start to appreciate again via Microsoft, Meta, NVIDIA. and it's tough to even say contract because yes at last year was at a hundred dollars and today it's sitting at 210 or 212 and we saw it get to 237 this year but the same theme that brought them down yeah eventually because these are again multi-trillion dollar companies even google amazon same thing right it's to spend it's to spend spend the only one that hasn't had lost attributed to capex band is apple and that's because we really don't know they're under invested yeah we don't even know what the ai plan is for them but yes have a mixture just be mindful that the way that these companies are moving right like sandus that was 20 that was november right here on market mondays it was 197 dollars yeah it was at 2100 right like yeah that that rookie is apple can it get to a trillion dollars, well, for it to get to a trillion, it'd have to trade at nearly$6 ,000 a share.

11:39It'd have to triple from here. And you're catching the rookie. You got to catch the rookies before they're hot. You're not in the finals. You can't buy Dylan Harper in the finals. Renegotiation will be different. In the words of you, Ian, listen the first time. When it was 200, I said it on, go do it then. At 2100, you're still thinking shit up. It's too late. Rookies are going to be great. Now, some rookies don't pan out to have great careers. Hopefully these do. We're investing in a lot of them. But just know that those vets are the foundation that make this thing go. If they don't spend, then those companies don't generate the same amount.

12:14They need the vets. And once again, ETFs is the all-stars, so you don't have to spend all of this time belaboring if you're not listening. But Rashad, that's a great question. That's a great question. Ernest, what's up? Look, building wealth isn't just about making money. It's about knowing where your money is working for you. That's why we partner with Empower. Empower is all about helping you invest well so you can go out and live a little. Their free Empower personal dashboard gives you a complete view of your financial life in one place. Track your net worth, monitor your budget, analyze your investments, set retirement goals, and more.

12:50You've worked hard for your money. Now make sure it's working hard for you. Download the Empower personal dashboard or visit Empower.com. Not an Empower client paid or sponsored. If your best finance people are doing expense reports, chasing receipts, or spending time on month-end close, it's time to get Brex AF, a Gentic finance that eliminates that work before it starts. Learn more at brex.com slash AF. Ryan Reynolds here from Mint Mobile. I don't know if you knew this, but anyone can get the same premium wireless for$15 a month plan that I've been enjoying. It's not just for celebrities. So do like I did and have one of your assistant's assistants switch you to Mint Mobile today.

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14:57Grainger, for the ones who get it done. This is an iHeart Podcast. Guaranteed human.