Program:  Mornings with maria
Date:  3/3/2022
Station:  Fox Business News
Time:  6:00AM

MARIA BARTIROMO: And it is time for the word on Wall Street. Top investors watching your money join me right now. Strategic Wealth Partners President and CEO Mark Tepper. UBS Financial Services Private Wealth Advisor Ali Macartney and Kingsview Wealth Management Chief Investment Officer Scott Martin. Great to see everybody this morning. Thank you so much for being here, Scott and kicking things off with you with this massive move in the price of oil. Crude traded as high as one hundred and sixteen dollars a barrel. That was the highest since 2008. We know that OPEC had their meeting yesterday saying that they will maintain an increase in output by 400000 barrels a day this month. That was lower than a lot was a lot of people were expecting. And yesterday I spoke with the power the future executive director Daniel Turner, about what he expects from the oil market. Listen to this.

DANIEL TURNER: One hundred and fifty easily. And if we do ever put sanctions on Russian oil, which is doubtful, but if they actually did, I think $200 a barrel oil is not impossible, and that will be devastating to our economy, to families.

BARTIROMO: Scottie, your reaction?

SCOTT MARTIN: I’m freaking out. You’ve been talking about it all morning, Maria, with some of the guests about just unlimited was a number that Donald Trump threw on there. And as you talked about with David earlier in the hour and five o’clock, the numbers are at least probably one 50 plus. He’s just heard from Daniel Turner there. So it’s scary. And it reminds me of a set up kind of similar to 2008, when oil prices spiked and then we had the economy get trashed. Now that was also on the back of the financial crisis, of course. But don’t forget that summer and how tough it was and how we’re coming up to a summer here when we’re coming out of COVID or we’re lifting the veil. The economy supposedly so great. Yet we’re going to be hitting summer driving season with with prices at seven or eight bucks a gallon. So the issue that I have more is the fact that you’ve been talking about it. Deggans said it earlier today, too. There’s just no plan as far as what this administration is delivering. The outlook is poor when it comes to any kind of support for fossil fuel creation here in the United States or utilization. And therefore, unless they come up with something different, this is definitely got a ticket to one 50 plus and possibly an economic recession not soon thereafter or very soon after.

BARTIROMO: Well, you know, you look at this week, Ali Oil this week alone is up twenty four percent. That’s just the week and the Federal Reserve obviously watching closely. Jay Powell yesterday on the Hill. And by the way, he’ll be back on the hill today. He will say much of the shame that he said yesterday, and he proposed a quarter percentage point rate increase at the central bank’s next meeting that happens in two weeks. Ali, as you know, this hike is lower than what much of the market was expecting, right? The market was pretty much pricing in a half a point hike in that meeting in two weeks, and it comes as inflation is at a 40 year high. Your reaction?

ALLI MCCARTNEY: We have had a ton of intra day volatility, but in the fixed income market and the equity market and coming into late last week, as you said, there was an overwhelming likelihood of a 50 basis point increase in March. At least that’s what the markets are forecasting and that was taking down all of equity markets, but especially growth stocks for all of the reasons that we we discussed every morning. So yesterday’s commentary was very meaningful in terms of being whether you use the word dovish, conciliatory and basically what he came in and did as you referred to it, the Powell pivot. I like that. Was he sort of xed out the noise that you’ve heard from other Fed governors that would allow people to get concerned about an aggressive interest rate policy that would crowd out growth, especially with this highly uncertain environment? And that’s what the market was looking for. So that’s why you had yet another one of these sort of about-face midday where you went from markets being, you know, really in the red to afterwards in the green. I think all the market wants to hear as it has been true all throughout the COVID period is this continued, we understand markets are uncertain. We understand situations are uncertain. We are being nimble, we don’t have a, you know, a preset plan. We are going to adjust. We have an eye towards inflation. We understand what’s going on in the market and the threats there, and we are going to address those as opposed to making, quote unquote another policy mistake.

BARTIROMO: Ali, is there an investment play here? I mean, I know the negative implications of one hundred and sixteen dollar oil, but do you want your own energy stocks here? It’s been one of the best performing sectors in the last year.

MCCARTNEY: Yeah, so look over the last couple of days, especially on on to on Tuesday. Cyclicals, so largely energy, financials, even industrials. So all the sort of reopening value players went down. So we are at lows that we haven’t seen in a very long time. We actually did take our our S&P numbers down just given what’s happening in the market and the massive uncertainty and the intricacies and interconnectedness of it. But we still see an S&P at forty eight hundred by the end of the year. And you know, individual investors have the benefit of not having to trade everyday, being able to hold long term. So I think that’s the place to go. I think industrials, financials, energy, we should be picking up here for sure.

BARTIROMO: Yeah. And Mark Ali’s taking her expectations down for the broader economy because of the impact on oil. Is it going to have an impact on jobs? We’re getting the weekly jobless claims out in an hour and a half. We’ll get the jobless claims out today and tomorrow, the jobs report. Economists are expecting 400000 jobs added to the economy in February. The unemployment rate ticking lower to three point nine percent. Does the oil shock hit the February jobs report mark?

MARK TEPPER: I don’t think so, not yet. And look, if we look at adding four hundred thousand jobs in February after like four hundred and seventy thousand in January, if the Fed really has a dual mandate, that’s the green light to follow through on their commitment to hiking rates so that they can fight off inflation. And look, my overall take on the jobs market right now is that it’s actually too strong. I think it’s overheated, and I think that eventually begins to hurt margins. And right now, if you think about it, the employee has pricing power over the employer. It’s a it’s a zero sum game right now where companies, they’re poaching talent from their competitors, they’re paying substantial premiums of like 20 percent, 40 percent. And those pay increases are not one time bonuses, they’re permanent. And the issue is you’re not getting talent that’s 20 percent or 40 percent more productive. You’re just paying more for the same productivity. And that, to me, just seems to be unsustainable. It seems like big companies are eating small businesses alive. And let’s remember small and medium businesses employ 50 percent of the private workforce. So how is a small manufacturing company supposed to hire someone at 12, 13, 14 bucks an hour when that same person can go to Amazon for 18 bucks? Or Target? Just recently committed to getting to twenty four bucks an hour over the course of the next couple of years. So the big get bigger, the small go extinct. And I don’t think that’s a recipe for success for our for our country, but

BARTIROMO: it’s a great analysis really pointing in and zeroing in on that and that jobs turnover. Ali, Makani, Scotty Martin, great to see you both. Thanks very much for the wonderful work on Wall Street. Mark Tepper, you’re sticking with this all morning and we’re grateful for that.