Program:  Making Money with Charles Payne
Date:  3/1/2022
Station:  Fox Business News
Time:  2:00PM

CHARLES PAYNE: I like to bring in Mark Tepper and Scott Martin, the Scott, you know, let’s I am excited about the market the way it acts, particularly over the last week. I do agree. I think we bought them on January 24th. Your thoughts on that and also obviously the daily grind, though of of having to even try to come off the canvas it does wear on you.

SCOTT MARTIN: It does it’s hard some days to come into work, believe me. Charles, as you see, seen futures down and then down further on the open market at 8:30 central time. It’s like you and Jim talked about, though it’s OK to be fearful here as an investor, as a money manager like myself. But fear is a creation of the best opportunities for an investor going forward. It’s just you have to buy one a lot. A lot of others are selling. It’s always darkest before dawn. And when you get these flashes like you just talked about with Jim there, these are times you’ve got to come in and try to catch a falling knife for two. And yes, your hand will get cut a couple of times, but there’ll be other times you’re going to catch the knife right on the handle and you’re going to take it up in the air. And so those are things that are worth the risk, in my opinion here, especially as we approach very oversold levels.

CHARLES PAYNE: I don’t know if I wanted to play the market or join the Green Berets. Are you as you were talking, you know, of course, Marky Mark, you’ve been cautious in this market for a while now. So what in your mind it could still be the downside risk? And really, ultimately, what would you be looking forward to become more opportunistic?

MARK TEPPER: Charles, I think the biggest risk right now is that obviously the war drags on, drags everyone into a recession. You know, and I can’t predict that I can’t handicap that. But what I’m watching very, very closely to give me kind of an indicator as to when it’s time to start getting back in is growth versus value. We all know value clobbered growth over the last year, but just as this war started to really kick into higher gear last week, it looks like that trade might be on the cusp of turning. You know when growth is abundant like it was last year, fresh off all those skinny checks, value stocks work, but when growth is being revised downward because of this Russia Ukraine war, investors again are willing to pay a premium for growth. So at this point, it’s too late to be chasing value stocks. I’d rather pick off good growth stocks as they’re beginning to turn.

PAYNE: And to that point, Scott, one of the favorite areas you know, outside of energy, the energy trade right this year, the financial part of that now maybe some today has something to do with bond yields, but it also feels like there could be something looming out there. I don’t know, maybe something with Russia, maybe a long term capital management, but financials are taking it on the chin. And I agree with Mark that value in general is extremely expensive on a relative basis. So where does that leave you?

MARTIN: Probably a little a little worrisome when it comes to financials because of rates, in my opinion, I think that contagion effect is so overplayed. I like some of the early Paris Hilton songs that I used to listen to. I mean, it’s kind of like, you know, the rates are something that’s obviously going to affect the net interest margin. But if you look at this contagion effect, Charles, we heard this before with Evergrande in China. We heard it with the Greek debt crisis. We heard obviously in the financial crisis, which proved true. But there’s been so many other issues that have been this contagion effect on banks that really haven’t come through. And so I don’t believe this is another case of that. Maybe that’s more of a European lender issue, which definitely could bleed over the United States a little bit, but I don’t think that’s a big effect. So I actually don’t want to touch financials here, but they’re going to get to a point as rates continue to plummet because the bond market is, in a word, freaking out like Lindsay Lohan used to do. So therefore, you’ve got to look at finances here as a bargain at some point on that value of trade that Mark talked about. All right.

PAYNE: So let’s talk about either what you guys are buying or what’s really high on your potential buy list. Let me start with you, Mark. What are you looking at in this environment? I know we talked about the parameters. What’s looking enticing and intriguing are the specific names rising to the top.

TEPPER: Yes, so I’m buying travel stocks, so I think there’s just a ton of pent up demand for travel, and I’m really hoping President Biden may give everyone kind of that all clear signal tonight. So I bought some delta below 40 bucks. That’s my favorite airline, and I just bought some Airbnb. I mean, if you go back to early 12, 20, 20, pre-COVID, it was over two hundred bucks a share and now it’s like one hundred and fifty bucks. Last quarter was good. Forward guidance was pretty strong and I’ve been hearing more and more from people that hotel kind of people are now opting to stay at homes like Airbnb, so that’s good for them. So I would be buying travel stocks.

PAYNE: Scott.

MARTIN: Yeah, I like pipelines here, Charles, trying to take advantage of energy, just not so much on the XL, but looking at the transport of the actual commodity and just a quick note about tap here, Mark Tepper if you’re playing at home. I mean, mark, the way you’re talking, you and I might take some trips together here going forward. So I do like travel as well. We own booking dot com, BC and G.

PAYNE: All right. Great conversation, guys. Thank you both very much, Mark and Scott.