☕️ What smart investors are doing now

Howdy! 👋 

All three indices are on the rise again after a Fed-induced brain cramp yesterday. 

I really feel sorry for the naysayers and negative nellies along with everyone foolish enough to listen to ‘em. 

The S&P, the Nasdaq and the Dow are up ~17.47%, ~25.8% and ~14.28% respectively from March lows. Many of the stocks we talk about regularly around here are too. Some are even doing considerably better. 

As I noted back then when the media was falling all over itself about the end of the financial universe as we know it, the hardest choices are often those that make the least sense. 

Like – oh, I dunno – me telling you that the dip was a great buying opportunity especially because nearly everybody else was in a snit. 

I hope you paid attention. 

History is very clear. 

Steady investors beat anxious investors. 

Here’s my playbook. 

1 – No, Warsh won’t be the easy money Fed Chair 

Wall Street did a faceplant yesterday after Warsh’s first time in the big seat. 

I wasn’t surprised. 

I’ve been a broken record for a long time saying very specifically that a) the Fed needs an overhaul, b) that the tools it’s using are antiquated and don’t reflect modern economics, and c) that Warsh could be forced to raise rates. 

In fact, I’ve mentioned it several times on air this year alone, including most recently to CNN’s Jim Sciutto. (Watch) 

I’ve also written about it dozens of times including right here in the 5 with Fitz just 2 days ago. (See #2). 

Personally, I think it’s great that Warsh apparently wants to gut the place because the Fed has been so far out to lunch for decades that it’s an insult to people who are actually out to lunch.  

The investor in me positively LOVES the fact that the first FOMC statement on his watch was significantly shorter than prior statements under his predecessors. 

Why? 

Because there’s a direct correlation between Fed statement length and market performance. 

Meanwhile… 

Trade Idea: Can you spell B-A-N-K-S??!! Most investors are still stuck in "when does the Fed cut?" mode and Warsh just made that irrelevant. 🎯 

2 – SpaceX & the Law of Unintended Consequences 

When SpaceX started launching rockets off the Florida coast, nobody was thinking about hotel rooms. (Read) 

They should have been. 

Every rocket launch brings engineers, executives, investors, and government contractors to town and all of ‘em need rooms, meeting space, conference facilities etc.  

The whole shebang. 

Miami-based Driftwood Capital just announced a $420 million Westin Cocoa Beach Resort & Spa opening next year — and once it opens, they'll control roughly 62% of the beachfront hotel inventory in the region and 11% of total hotel inventory. 

The local condo market is still in correction territory but that’s largely pressured by Florida’s post-Surfside legislation and reserve compliance requirements.  

If you’re waiting for prices to stabilize before buying in the area, you may find that window closed before the Westin opens in 2027. 

Meanwhile, waterfront prices remain strong. 

Hmmm. 

Keith’s Investing Tip: Keith’s Rule of the Back Page is exactly what it sounds like. Always look beyond the headlines to the back pages because by the time something’s on the front pages it’s often too late. 

3 – Wow, this is really stupid 

Sometimes you read something and think “Wow, this is really stupid.” 
 
That was me this morning. 

I literally facepalmed myself when I learned that The Senate Armed Services Committee just approved a provision in the must-pass defense bill — the NDAA — that would bar major defense contractors from buying back their own stock or paying dividends without Pentagon approval. (Read) 

We're talking Lockheed Martin, Northrop Grumman, Boeing… basically the biggest names in the defense business. 

The argument sounds great on the surface … defense primes routinely miss contract deadlines, underdeliver and then have the audacity to award executives huge salaries and bonuses. 

The problem is that it’ll punish investors. 

Stock buybacks and dividends play a huge role in reducing price volatility, enhancing overall market liquidity, keeping transaction costs low and, most importantly, helping create more stability for frightened retail investors when the markets get rocky, uncertain and scary. 

If the goal is to make defense contractors accountable, then make them accountable by doing two things: 

1. Change the contracting process to reward completion, not just showing up like the present model. 
2. Require deferred compensation for executives that is vested over years and associated with completion rather than stock price. 

I think this potentially has ‘uuuuuge ramifications, but I’m not sure where this lands just yet. 

If this provision survives the House negotiations and becomes law — effective June 2027 — it changes the calculus on some of the biggest names in defense. Not necessarily permanently, but almost certainly enough to matter.  

The smart move right now is knowing exactly what you own and why before this gets any closer to the finish line. If you’re an OBAer, we’re on it. 

Meanwhile, no word on what stock savant Paul Pelosi or any of the other Beltway Bandits think.  

Might be worth checking disclosures from Sen. Richard Blumenthal who – last time I looked - presently occupies the 2025 Congressional Leaderboard with 406 trades with $80million or Rep. Jefferson Shreve who’s apparently logged 200 trades worth approximately $29 million (both according to LifeZette’s 2025 list of top insider traders). 

But I digress. 

4 – Intel, great but I’m more interested in Apple 

Intel shares have jumped this morning on news that US President Trump said "Apple has agreed to work with Intel to design and build its Chips in America." (Read) 

Excellent. 

I’m more interested in Apple for two reasons: 

1. Apple still designed the chips while Intel is the factory which means that it’s all Apple silicon – Apple IP, Apple architecture, Apple margins. Intel gets the revenue but Apple keeps the crown jewels. 
2. Adding Intel as a foundry gives Apple more pricing leverage, supply security and flexibility. Intel just gets more money.   

5 – Quantum computing, coming sooner than you think 

Amazon AI chief Peter DeSantis says in 5-7 years, “we’re going to start to see the first commercially useful small-scale quantum computers”.  (Read) 

I agree. 

But also, in the same breath, think it’s sooner than that. 

I hope you’ve got at least one quantum choice in your portfolio like the OBA Family does. 

Keith’s Investing Tip: Buy the best, ignore the rest.® 

Bottom Line 

People playing for pennies at moments in time usually lose out to those playing for dollars over time. 

Just sayin’. 😄 

Now and as always, let's MAKE it a great day. 💯 

You got this — I promise! 

Keith 😀