Live from music row Tuesday morning on The Tennessee Star Report with Michael Patrick Leahy – broadcast on Nashville’s Talk Radio 98.3 and 1510 WLAC weekdays from 5:00 am to 8:00 am – Leahy spoke to Adam Darwish who is the Education Director and Senior Education Counselor for the Trading Academy in Nashville. Darwish talked about how the stock market embraces volatility and that many traders are not worried about impeachment because they don’t think it will pass the Senate.
During the third hour, Darwish explained that a deal with China would be a key indicator that could get the economy moving again in the right direction. ‘But China as a whole, we have billions of individuals that are living there. There are consumers. There are traders. The export. The importing. It all hinges on the deal with China right now,‘ stated Darwish.
Leahy: Big day for us! In-studio, all-star panelist Adam Darwish and of course the original all-star panelist Crom Carmichael. Adam!
Darwish: Good morning Nashville!
Leahy: Welcome. The first time you’ve been on as an all-star panelist. And you are an expert at online trading and the stock market. So we have a big question for you here today. Because you know, I’ve always been sort of a political guy. I’ve been interested in economics. I never really got the desire to follow stocks.
A lot of people do and are probably end up making a lot more money than I did on that. But it’s a good thing to do. I picked up a book on this as a kid and started reading it and it just put me to sleep. But obviously there’s a lot more to it. What’s the impact of this impeachment inquiry Adam, into the President with what the stock markets doing?
Darwish: Well, it’s interesting that you ask that Micheal because when Nancy Pelosi originally announced the impeachment process that’s taken into effect a few weeks ago, the stocks tumbled.
Leahy: They did? OK, this is good. I pay so much attention to politics but gain, I was not paying attention to that at all. I guess maybe I do vaguely remember stocks tumbling. So she announces it like two weeks ago today, in the afternoon.
Darwish: That is correct.
Leahy: An impeachment inquiry. And so the stock market was closed when she made that announcement.
Darwish: Correct.
Leahy: What happened to the stocks the next morning?
Darwish: Well, it’s funny you ask that because the next day Trump announces an imminent deal that’s going to be happening with China and everything rebounded.
Leahy: Really?
Darwish: Absolutely. You know the impeachment process is happening against a backdrop of a lot of geopolitical uncertainty that has already ruled the markets this past summer.
Leahy: The markets have been fluctuating.
Darwish: Well, there’s volatility. And volatility is always going to exist in the markets. But when you have well let’s put it this way, lots of fake news out there.
Leahy: None of which comes from the Tennessee Star or the Tennessee Star Report.
Darwish: I agree 100% Absolutely.
Leahy: But with fake news out there it accentuates volatility.
Darwish: It does. And what it does is take the fundamentals away from what these companies and what the US stock market has been able to do. And it basically takes and throws it right into the toilet. And you know, America is trying. You have hard-working Americans, Nashvillians, everywhere that are day in and day out working hard.
Putting their money into their retirement accounts. Doing everything they’re supposed to be doing, and yet, these politicians are coming out and throwing impeachment of all things out there. And if they would have just waited a day or two they would have heard the call.
Maybe that wouldn’t have been the issue. Maybe they wouldn’t have even have brought it up. But there’s always got to be some smoking gun that has to be thrown out there that’s affecting what this market is trying to do for Americans across the board.
Leahy: So walk us through then on the market. So, impeachment inquiry announced when the markets are closed two weeks ago on Tuesday. Wednesday morning stocks tumbled significantly that afternoon Trump announces progress with the China deal. Stocks are back up. What’s happened since then?
Darwish: Well, since then you have to understand a lot of market specialists, they truly believe that the markets can look past this. They understand that with the Senate in control there’s not going to be an impeachment.
Leahy: OK. This is something that I look at when you hear the market already discounts things. Because these are smart guys up in New York City.
Darwish: Absolutely. And throughout the globe. These are global analysts.
Leahy: You’re right. It’s everywhere right?
Darwish: Absolutely. They are getting to the point where they understand that there’s news that’s going to be thrown out there. And there’s political news that being thrown. But what it does is it does create opportunities in the markets. And the opportunities in the markets that I speak of you may not have many individuals talk about is that they like this volatility.
Leahy: They do?
Darwish: Absolutely.
Leahy: And because why?
Darwish: Well, lets put it this way. When the markets go up everybody’s making money. Everyone’s happy. They’re complacent. But when the markets drop, that money has to go somewhere. You may lose it out of your 401-K but it’s going somewhere. And the institutions are able to take advantage of a lot of that.
And that’s where the short-selling comes into play. So these institutions are not, when I’m talking about these large investment institutions, regardless of the direction of the market, it doesn’t bother them. But this just gives them an additional little piece to be able to use to drop the market and take that selling effect.
(Commercial break)
Darwish: A deal with China would be the key indicator to get this economy moving again in the right direction. That’s pretty much the cloud that’s been hanging over the heads of the financial market. Because it is a primary key indicator. Impeachment talk isn’t and the chatter isn’t.
Leahy: So impeachment talks not a key indicator?
Darwish: It will not.
Leahy: That’s very interesting.
Darwish: They can look past that because they understand that the Senate holds the key in that final decision. And a Senate is not going to vote an impeachment.
Leahy: OK. So they’ve figured that out that the Senate is not going to convict the President.
Darwish: Absolutely.
Leahy: But China. Would China matter because they’re such a big dog in the whole world economy these days?
Darwish: Oh. I mean they’re the second-largest economy if not the largest. With what’s going on in Hong Kong, unfortunately, what’s happening there, we see on the news and everything and the political turmoil and everything that’s going on there.
But China as a whole, we have billions of individuals that are living there. There are consumers. There are traders. The export. The importing. It all hinges on the deal with China right now.
Leahy: And did the smart people who watch this do they think a deal with China is likely or not? Or this terraform of sorts, will it continue or not? What do you think?
Darwish: As Mr. Crom had mentioned. The whole thing with China can be a lifetime or two ahead. But this is a phenomenal start that we have of actually finally starting to approach what’s been happening with China. I mean this morning it was reported that I believe it’s about 10 technology companies out of China that have been finally blacklisted. These are little key points that Trump and his team used to go into negotiations.
Leahy: So he’s negotiating tough on this. Crom, I want to bring you into this conversation. Crom, you’ve been in business for a long time. I don’t know how much you follow the stock market. I know you do a lot of investment in small growing companies. Are you a stock market guy also?
Carmichael: Not really. I mean I follow the stock market just because it’s a good indicator of the economy. Because stock markets are generally forward predicting. And so I do watch it. And Adam is correct. The China deal, of course, I don’t think there is not going to be a China deal. I think it’s going to be a lot of muddling.
You can strike a deal. But I want to give a comparison. What Trump has done with Mexico and Canada is re-do that deal so it’s more American-centric. But it’s not all that harmful to either Canada or Mexico. The new deal needs to be voted on by the House, which Pelosi doesn’t seem to want to do it.
Leahy: Doesn’t want to do it.
Carmicheal: And by the way, if that deal passed I believe the stock market would react positively because the deal is good.
Leahy: And Adam. Would you agree with Crom on that?
Darwish: I do. The fact of the matter is the deal with Mexico and China is for our farmers. It’s definitely 100% American-centric. But it also opens up better pathways. Better deals. Better opportunities for the American economy. And the fact that Congress won’t even put a vote on this is telling us that they’re trying to hold back the economy. Why? Why would they want to hold back the economy of the American people and hurt our pockets?
Leahy: Crom, you want to venture to answer that question from Adam?
Carmichael: This is the problem. the Democrats do not want to give Trump any kind of victory. And the Democrats are willing to hurt the working American people because of that. And so you have to ask yourself, why are Democrats that way. And that’s because Democrat’s first constituency is the government itself. Not the working people.
Listen to the third hour:
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Tune in weekdays from 5:00 – 8:00 am to the Tennessee Star Report with Michael Patrick Leahy on Talk Radio 98.3 FM WLAC 1510. Listen online at iHeart Radio.
Photo “NASDAQ” by bflshadow. CC BY 2.0.
