White House Insider Trading Scandals

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Don't pay hundreds or thousands of dollars for what you can get from Northwest for free. Visit Northwest Registered Agent.com slash prof g free and start using free resources to build something amazing. Get more with Northwest Registered Agent at Northwest Registered Agent.com slash prof G free . Today's number fifteen. That's the percentage drop in new reality TV shows that premiered in America last year. Competition in the space has been dwindling for a while now as viewers flock to what has become the nation's most popular reality TV show. It's called The News. Money markets matter. If money is evil, then that building is hell. Show those up Sell, sell . Welcome to Prof G Markets. I'm Ed Elson. It is April 1st. Let's check in on yesterday's market vit als. The first quarter wrapped up with a bang as the major indices staged a dramatic rally on a potential end to the war. More on that in a second. Meanwhile, the dollar dropped. Treasury yields fell, and finally Brent crude declined, but remained above $100 per barrel . Okay, what else is happening? Wall Street was on track for its worst quarter in four years until a rally Tuesday softened the blow. The S P five hundred was down as much as nine percent from its January peak. That was its worst quarterly performance since twenty twenty two, but Tuesday it surged nearly 3%. Meanwhile, the NASDAQ was down as much as 13% from its peak and entered correction territory. That was at least until its blistering rally of nearly 4% on Tuesday. Recovery came after Trump told AIDS he is open to ending the war, even if the Strait of Hormuz remains closed. Then Iranian President Pazeshkian said Tehran has the quote necessary will to end the conflict in exchange for security guarantees. And with that, Wall Street got the quarter-ending rally it was waiting for. So, here to help us unpack the market's performance so far this year. We are joined by Kevin Gordon, head of macro research and strategy for the Schwab Center for Financial Research. So Kevin, I was gonna have you on here to break down the seller for what was going to be one of the worst quarters ever. And then we get this big news. Trump says maybe the war is gonna come to an end. Iran says maybe it's gonna come to an end too. And then the market rallies. Let's just start with your reactions to what we saw on Tuesday. The key word is maybe. Um and I think today is uh sort of em or you know the end of the the the final day of the quarter is is uh emblematic of the whiplash environment that we've been in and that's really how we've been characterizing this market. It's uh not impossible to trade , but when you're really kind of starving for for accurate information uh you know out of out of both sides in terms of what is the condition of the Strait of Hormuz, uh how is it, you know, what it what does the traffic look like, what is the potential for that to get back online ? What is the the knock-on effect going to be for the global economy? All of these unanswered questions. Um, I think that just makes markets uh you know a little bit more aggressive and volatile when you get any snippet of good news, but also to the downside . Um, you know, we've had our fair share, especially at the end of last week. Um, you know, that was sort of a clear example of uh kind of all the negative news compounding. So I think that today's move, you know, doesn't really surprise me. Um I I think that one thing to to sort of look at in terms of the the strength of the durability of the move. I wouldn't put a whole lot of stock into it because if you look at the kind of underlying breadth and and subsurface moves of of the S P 500 at least, um advancing volume wasn't that strong. It was actually a little bit last I checked right before I joined you, so uh I'll have to check for the official closing stats, but last I checked, it was actually stronger um last Monday than it was today in terms of advancers relative to decliners. I mean when you look at what was lifting the index significantly, it was actually tech and communication services. So yes, you still had a majority of members in the S and P that were advancing. Um, but it was a lot of that megacap strength uh reasserting itself because those have actually gotten hit. Those are some of the hardest hit markets so far this year, uh, even if you back it out actually over the past six months. So a little bit was a was sort of this reversion into those names, but also just sort of this classic momentum trade going in reverse where energy had been the leader. Today it got you know hit the hardest, uh, similar with you know with tech and communication services. They had been struggling a lot, and then they had found, you know, the sort of the strongest move and the strongest bid today. So I wouldn't put a whole lot of a whole lot of weight into just one day, but especially because some of the background conditions, whether it is the breadth uh underneath the market or whether it is actually the fact that oil prices continued to move higher today. I think that in and of itself is a little bit of a reason to sort of step back and not extrapolate the move that we saw for U.S. stocks. Aaron Powell I'm so confused as to why investors appear to be either buying or selling in huge numbers based on what Trump says. But that seems to keep on happening. He says, okay, this war's gonna end soon and then markets go up. And then he says actually it's probably not and then markets go down. Is it your belief that what is happening, what happened in the markets wasn't necessarily a response to uh what happened in Iran because it was mostly a rally in the tech sector, or are the two still quite related? Yeah. I mean well when you look at the contribution to the indexes gained today from tech, I I kinda lump tech and communication services in with each other because they have kind of become that, you know, big tech that tech like li you know trade, lowercase T, um they're clearly different sectors and they have very different makeups in terms of their, you know, their membership profiles. So it is important to make the distinction. But if you combine those two, you're talking about, you know, around forty percent of the S P five hundred's market cap. So if they're advancing and doing well, pretty hard for the, you know, for the headline index to to struggle. Vice versa, you know, a lot of what we were experiencing year to date right before the war, those sectors were struggling. They were sort of taking a step back from their leadership positions. And that was kind of giving the illusion that the headline SP wasn't doing as well. But underneath the surface, you had actually seen a lot more improvement in the average stock doing, doing quite well, the equal weighted S P five hundred, if you want to think of that as as the proxy for the average stock that had been doing well. So yes, I do think most of the move today was kind of just that snapback and that reversion for a part of the market that didn't necessarily get a lot of love or hasn't gotten a lot of love for the past six months. And I would add to it, um, you know, not only was the sort of the subsurface breadth not as good as I had mentioned uh earlier, but the flow data actually into a sector like tech was not very strong today. So there wasn't this sort of high conviction on the part of traders, especially in the retail crowd. I was looking specifically at that cohort, um there wasn't a lot of high conviction in terms of that move really bringing them back in. What do you make of this quarter as a whole? It feels like there have been two major market-moving events. I guess the first one was AI is killing software. And I mean, uh some of the drawdowns we've seen, even the even in the companies that are technically AI companies like Microsoft, even NVIDIA's gotten pretty crushed uh recently , uh that seems to be one story, which surprised people for various different reasons. And then also Iran and what that has done to oil supply and what that may do to the economy. I guess I'd be interested to hear your reflections on Q one. I mean, I I don't think these are two things that people necessarily predicted, but how does it change your outlook for the year? And what are your reflections on what has been kind of an insane quarter. It has been an insane quarter. I mean, an insanely long quarter. I j I feel like it's it's been a year. Uh, because, you know, this dates back even to Venezuela and Greenland. I mean, that was in the same quarter. Um , it's hard to it's it's it's hard to you know imagine that so much has has gone you know, I've been joking that we're still in January. Um and so it just you know it just feels drawn out. But I think that you know, for for Iran in particular, um yes, it I I think it will change the calcul us of how we think about the trajectory of of the economy moving forward. What's what's difficult is, you know, uh there's just so many unknowns in terms of what is the you know, what's what is the strategy of of of the of the US. And I think that matters in the sense of trying to figure out and sort of game out a scenario analysis for where oil ultimately ends up. Because I think that you know, going up to $120, I'm just sort of you know, using rounded rounded numbers uh out of the air. But a hundred dollars twenty dollars a barrel for for oil, if you get up to that, um that doesn't really tell me much. I wanna know what is sort of the floor after that and where do you've ultimately kind of plane out and and find a sustained floor. Because if it is around 100, that's a meaningful shock up from 60, which was the recent low. That probably keeps gasoline prices, you know, at least a little bit above four dollars. And gasoline prices take longer to come down um than oil does. So I'm thinking about it from the mindset of the consumer. To me, this is much more of a sort of direct to consumer shock versus something like Liberation Day last year, which was more of a direct to business shock because those are the ones that sort of faced it first in terms of the import fees and the hike in rates that they had to pay. Um the consumer, as we've sort of learned, didn't face too much of that tariff burden throughout last year. There were bits and pieces, and certainly in the goods market, um there was some pass-through. We've actually started to see some pass-through earlier this year. But I think of this as more of that direct-to-consumer shock. And if you think about, you know, the two things that the average consumer in America, I would say probably the world, but in America in particular, um, you know, thinks about as the most important gauges of economic health, its grocery prices and its gasoline prices. So to the extent that this starts to cause a little bit of a shift in how they spend their money, that I think will will ultimately lead us to sort of change how we think about the trajectory of the economy. I will say though, there needs to be, I think, an important distinction, and so far this has played out in the economic data that we've gotten. There does need to be a distinction between what is a consumption shock and what is a labor shock. Because if you if you do hit the consumer spending power of the cons uh or you hit the sort of consumption basket, that's one thing. But if you start to take away consumer spending power via lower income, you know, through less That's a very different story. So far, that hasn't been the case. Initial jobless claims, you know, which we get every Thursday morning at 830 Eastern, those have actually rolled over. They haven't picked up much. We haven't really gotten any uh you know sort of company notices of of mass layoffs uh across industries. So as long as that's the case, um I think that it will keep the economy sort of on track to grow. Uh but I think it's you know it's it's probably relatively easy to say that we're gonna have to Aaron Powell Well while you're on that point, we just had this news that Oracle is laying off thousands of employees. It kind of just came out of the blue. They just sent an email and thousands of employees were uh dismissed and again it is one of those stories of this was an AI story and we have seen more of these we've seen it with uh Pinterest we saw it with Amazon we, saw it with block, block was another big one. Um, are those AI layoff stories signific ant enough to you to make to pose real problems in the labor market going forward? Like is that just more of a this happens to a handful of tech companies and you know it might be very uh shocking for that industry itself, but not necessarily going to have a massive implication for the larger economy. Where do you land on these AI layoffs in terms of their impact going forward? In just sort of simple math terms, I mean the information sector it's it's hard because the BLS uh you know, they don't have tech specifically carved out as a name of an industry, but information is essentially that that's the name that we can we can sort of associate with tech. Um that's that's a pretty low single digits in terms of the percentage share of overall payrolls. So number one, that's a pretty small sort of impact directly, at least for overall payrolls. But number two, that share has actually been rolling over for for a couple of year almost a couple of years now. So we've started to actually we've continued to see, we started to see it a couple of years ago. Um but we we've continued to see this move away from you know tech dominance in terms of that share of employment growing, because it had been growing for a while, but now that's actually started to reverse lower. And it's been in favor of areas like health and education, I mean, you know, private health services. So we we've seen that handoff. Um, in that in that time frame, of course, the economy has continued to grow, the labor market has continued to grow, not in a in a strong way, not as strong as we've been used to, but we've still continued to see economic growth. So I think that it keeps that you know a little bit more idiosyncratic. Um, but at the same time, it is emblematic, I think, of what's happening to the broader tech industry. And I think actually brings up an interesting point about tech for this sort of next earnings season. What I found interesting so far, year to date, is that uh tech earnings revis ions uh within the S P 500, that sector has actually seen the most aggressive upward revisions. So analysts have continued to get more optimistic on what EPS is gonna look like for this year. Um I I'm gonna be very sort of hawkeye focused on in the next earnings season, uh whether that is driven by sort of this profit margin protection of, you know, laying more people off or whether ac they're actually continuing to see strong organic uh, you know, revenue and strong demand. I I think those are two very different things. And that to me will determine a lot of the sort of the fate of where tech goes for the rest of the year. Aaron Powell And it's striking because it's gotten so crushed this quarter. I mean, it's just one of those sectors where they keep on posting great earnings, uh keep on beating estimates by and large, and then they still get punished either way. Just as we wrap up here, it seems as though as it stands , end of Q1, 2026 . I don't know if you agree with this, but it it seems as though this might be one of the most uncertain times in market history. It seems as though invest ors are incredibly unanchored from what is actually happening on the ground because they're asking so many questions about what the future might look like. And they're not really willing or very interested in in looking at the previous backward looking data because everyone's view is kind of like, well, the future is in completely uncertain. We don't know what's gonna happen in Iran. We don't know what's gonna happen at the price of oil. We don't know what AI is going to do to the job market, what it's going to do to software, to tech, et cetera. So it's kind of like a free-for-all, is the way I feel right now. I I'd be interested to hear if you agree. Like, do you agree that this is the most uncertain time we've seen, at least in the past, I don't know, ten years? The U word I would use is actually unstable. Um and unstable and uncertain are to me are different things. That was actually a key theme that we had coming into twenty twenty six, not that we in any way predicted uh, you know, the war that uh we're in right now. But you know, instability is a little bit uh more it's it's it's definitely less comfortable in terms of you can see these things that are shifting. You just don't necessarily know how to respond as an investor. So um not that we think you need to respond to all of these events. I would actually argue against that and and say that you know you should be lengthening time horizons and really reassessing what your risk, uh your risk tolerance and your emotional risk tolerance is in in these environments. But I think to your point, you know, something I've been thinking about lately and going through all of these things that are happening right now, it's sort of a monster mashup of prior crises, or it's sort of the ghost of prior crises, you know, pasts that are coming to haunt us all at once. Because you have the AI story. A lot of people, you know, liken it to the late 90s with the internet bubble. You have an energy crisis going on right now that people liken to 1990 or the late 1970s, mid to late 1970s. Uh, but then you also have this, you know, tariff regime that we're still in, which harkens back to 17 and 18, or you know, even uh, you know, even last year. Um, so it's it's all of this sort of happening at once and mas hed up. And I think that's what's causing a lot of the, you know, the stress and the anxiety around how can the market continue to do well or not sell off as, you know, as uh as much as we'd expect um with all of this going on. But to me, it gets back to I guess a framework that I've been using for for these moments, which is what is the front page risk, what is the bottom line risk? Uh we've gone through a lot of front page risks and faced a lot of that this year, whether it was Venezuela, whether it was Greenland, whether it was everything with the Fed. But the bottom line risk wasn't as acute or as sharp because it wasn't filtering down to how is this going to affect SP 500 earnings? Because at the end of the day, it's probably what the market, you know, that is what the market cares about the most. This more recent conflict, you know, I think is is kind of narrowing the gap between those two. So that's kind of what I'm on watch for is to see how much of this direct-to-consumer hit really manifests and how much of it grows. Um and that's where I could see this translating from, you know, just the front page stuff to an actual bottom line risk. All right, Kevin Gordon, head of macro research and strategy for the Schwab Center for Financial Research. Kevin, always love having you. Thank you for joining us. Thanks, Ed . After the break, an update on the chips market. And if you're enjoying the show, please follow our new Prof. On YouTube. The link is in the description. Subscribe now . 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Last week, US memory chip stocks shared $100 billion in market value after Google revealed an algorithm called TurboQuant that could reduce demand for the chips. Stocks rallied yesterday, though, as investors bought the dip, but they are still down for the past week. Meanwhile, the Iran war is stoking fears of a supply crunch in helium, a critical material in chip manufacturing. Despite yesterday's broad market rally, NVIDIA is still trading at a forward PE below the SP 500 for the first time in 13 years. So lots going on in the chips market right now. Here to break down what's happening. We're speaking with Doug O'Loughlin, president of Semi-Analysis. Doug, great to see you. This movement in the chip market that we're seeing is a little bit confusing. I mean, first, Google comes out with this algorithm, TurboQuant, which supposedly is going to kill memory stocks, and people were calling it Google's uh or memory's deep seek moment . Uh, but then the ch the memory chip stocks rise yesterday, so did all the other semiconductor stocks. W what is going on here? Okay, so I think what we're actually seeing is a lot of leverage under the surface, right? Memory has been a really popular trade year to date and it's become very crowded, right? That's the most simplistic way to think about it. And I think SK Heinex, which is a cheaper alter, like the stock is cheaper on fundamental metrics, but it trades in Korea, is recently been uh talking about leasing uh uh you know an ADR. And because of that, that's gonna kind of you know move some of the supply of uh rather some of the demand for micron away from micron shares into SK Heinrick shares. That's one simplistic way to think about it. The other side of it, I think, is just you know, a lot of momentum unwinding. A lot of the s the moves were very like multiple standard deviations out of the normal, specifically for negative uh negative chip stocks and positive software stocks. That's effectively been the most popular trade year to date. And so what I think what you're you're witnessing in terms of the confusing moves is more a function of degrossing than fundamental uh information. And I definitely want to talk about turboquant because like tur turboquant's fake. I mean I I have no other way to put this. Um there's okay and I I can even give some like insider baseball. I feel like that will really help. Um one, almost always what happens is in a closed lab, if they're willing to publish a paper about it publicly, that means that there's some kind of breakdown that means it can't scale at a larger amount. Because if it, you know, if it did work at a larger amount, you just keep it inside and you would essentially increase your margin versus your competitors. It's so much so that I know that closed labs have a political movement. So pretty much like if you want to screw someone's uh career is you publish the finding that they worked on. I really don't think turboquant is a big of a deal as people think. And if you scale it up, pretty much what happens is that there's an immediate throughput disadvantage. Partially a big part of it too was comparing the the quantization schemes. So it's like a 32-bit versus like you know I think it was like a four-bit that difference alone accounts for a meaningful uplift in the KB cache compression. But last and not uh not least is the most important portion of this whole thing is if you get more context and in via KB cache, essentially users will just use more context. So I I think I think it really is a nothing burger. Like I really cannot express this enough. I know that if it was really, really special and secret and good, it wouldn't have been released. Um there are optimization techniques for KB Cash that happen at every of the leading labs, and this is just one of them that was published to the to the public. Yeah, it it's interesting how how the the market reacted to that TurboQuant release, which was again, I mean Google comes out with this algorithm that's the the idea is that it's gonna Um and everyone freaks out. But it p it appears that now markets are kind of re understanding what's happening because memory stocks are now rising again. And what I read is that Bernstein had put out some research saying we're not so worried about this. Everyone decides to buy again. The point being it seems that investors are kind of don't know what's going on here, just on a on a technical basis. Like they're waiting for someone else to tell them, this is the deal, this is what this means for you. Would you agree with that? And if so, what does that mean for this market? I would mostly agree with that. And and I think it really comes down to risk appetite and what's happening at um investors all around the world, right? Stocks that go up very quickly, often hap uh give it back very quickly. And I think that that's the big thing that we're witnessing. Micron trades really cheap on a Ford priced earnings, but oftentimes memory stocks kind of uh top out at a cheap uh price earnings because they're inherently cyclical. Now, in this point in time, I think what happens is like as it becomes you know cheaper and cheaper and cheaper as the memory price goes up and up and up, effectively it's like a game of chicken. One day the memory price will go down, and what will happen is the s the shares, which often um are very, very cheap at the top, become, you know, the operating leverage is meaningful to the downside. And so this is like the history of every memory cycle. But at this point in time, I want to be pretty clear about this. We still continue to believe that there is way more demand than there is supply. And supply has a unique constraint that pretty much there's no meaningful blocks of supply that will come online until the second half of next year. That's because the long lead time items of like m building a whole clean room takes a long time. And so that's kind of gonna be this continued supply-demand gap that we see in the market. I just want to shift to to uh some other names here. Nvidia is an example, um, which is as I mentioned, it's trading at a forward PE that is below the S P 500 average. In fact, NVIDIA's forward PE is now lower than ExxonMobil's forward PE, which is pretty remarkable. What has changed in terms of the NVIDIA narrative here? Why is it? I mean, this is the AI company, and yet investors are saying we're not so excited. In fact, we're more excited about ExxonMobil. This is a hard question and one that I've been answering to a lot of my clients. It's really hard for us to understand why the big companies trade the way they do. I'm gonna actually look to history a little bit and give an example of a company that won so so stupendously in its market that the earnings multiple collapsed. Um the company that comes top of mind is Apple. Apple once upon a time in the like late teens or maybe even mid teens. I don't know. Uh late teens, I think it traded for eight times earnings X cash. Um the entire time the company was growing at a healthy clip. But what happens is um sometimes effectively if, you think about it, there needs to be an incremental buyer. It's the single biggest company in the world. It's a well-understood story. And I think what's going to happen is this the stock will probably continue to work based on its earnings growth, which if you the reason why, you know, the um the forward earnings is so low is because they're expected to grow over 70% revenue this year. And that's that's a pretty remarkable um revenue growth rate at a company that their size. So I think NVIDIA is going to be fine. Um, but I think part of it is when you're at the top, there is kind of a whole different special set of second rules and they are the single biggest company in the world. And so the flow, the liquidity kind of really fights against you. You become such a big portion in indexes , it it becomes a little bit of a battle, I think, from a supply and demand of your shares. And that's um what I think is capping the, you know, you know, near-term, let's say, stock provisions. And I think continued execution is what will make NVIDIA's stock and the value of its earnings be valuable again. Because you can look at other parts of the market for AI, and there's many, many, many different parts that trade for 30, 40, very healthy times multiples of earnings because there's a lot of excitement. I think it's just a difference in magnitude of scale. Yeah, if Apple is the is the comparison, then it would lead me to believe that perhaps this is a good buying opportunity. I certainly seem to think that about Microsoft, which is I was just looking, it's now trading roughly where it was after Liberation Day, after that meltdown last year. Microsoft is another AI company building the data centers, getting absolutely crushed right now . Meta, by the way, is in a slightly similar position, also trading near where it was after the meltdown, after Liberation Day. Just before we let you go here, I'd love to get your views on those two names: Meta, Microsoft , and why they too are getting clobbered at least so far this year. Yeah, I think it's really interesting and I think it's time to think about how AI impacts both their business models, because I think that that's the big difference. Microsoft, I think the big difference is that they're a horizontal software company with Office 365. And there is no company that is challenged more than they are at a core basis. Um, from ChatGPT, from Anthropics Cowork, and obviously they're working really hard to fast follow, kind of like they did with Teams and uh Zoom, right? Uh and you could already use Slack as well. But at the same time, when this the the the pace and the the speed of market is moving so quickly in AI, I think that there's a real um invalid reason to question the longevity of Microsoft's core business, right? Office 365 is under threat, if AI is going to be doing a lot of the information processing that humans on a seat-based software consumption model previously did. Now, at the same time, Azure happens to be the biggest, you know, we'll call it NeoCloud in the world, right? They are the single biggest infrastructure player, and that business is working at a very healthy clip. So I think that there's a a kind of a narrative headwind to Microsoft where they have kind of barbarians at the gates of their core business. But at the same time, uh, you know, the the barbarians at the gate happen to be their biggest customers, right? So there's this kind of this uh push and pull, but at some price, I believe you're kind of going to be able to get office for free because the value of the Azure portion and the revenue acceleration from that. And then if you include or X out Windows, the stock becomes pretty cheap. But I do believe that there's going to be quite so like look, it's probably a very cheap and exciting stock, but there's definitely some narrative head winds. I think on the other side of it, you have Meta, right? Meta, meta's business model is actually, you can argue, one of the most um advantageous in terms of like high ROI spending. And that's also another question. I think the hyperscalers are coming to. ROIC is going down as they they they spend all these big dollars, but they're able to get pretty good returns on capital on this huge base. That's like a side thing. But um meta specifically can sit there and use all the GPUs that they have to make better recommendation learning um learning models and sell higher value ads with more impressions. So they can make the users that they have more engaged as well as the value of the advertisement slot for the user more valuable. And you can see this in CPMs going up and pressions continue to stable out. And so they have a really high ROI opportunity, but at the same time they also are missing something really important, which is a core fundamental AI lab. And so they have this ability to monetize the GPUs at a high rate, but I think that there's a fear and concern that they're going to kind of be left at the roadside. And Zuck said this many, many times. He doesn't want to lease the future, like kind of how he was he had to essentially rent Apple's toll booth, right? He wants to own a foundational um AI lab. And so I think that that's going to be a big part of the value of the company in the future. And I think the mis-execution in avocado, which is their large pre-trained model that they just recently finished, wasn't as good as other Chinese open source products. That's kind of the rumor. And I think because of that, um, people are viewing that as meta isn't going to do a really good job from an AI perspective. So that's kind of the narrative, I think, around Meta, but I do think that they're the most scaled player with a meaningful ROI of deploying AI into their core business. And I think Meta will continue to do well. And Zuck, Zuck's not the type to lose. He's not uh he he's very competitive. So that's kind of the meta story I think on the other hand. Doug Laughlin, president of semi-analysis. Very interesting time to be the president of a semiconductor research company. So I congratulate you Doug and appreciate your time. Yeah, thank you so much . So here's the latest on the insider trading scandals that continue to come out of the White House. According to a new report from the Financial Times, US Defense Secretary Pete Heggseth tried to make a multi-million dollar investment in a defense fund before we went to war with Iran . That was according to multiple people familiar with the matter. Reportedly, Pete Heggseth's broker at Morgan Stanley had contacted BlackRock to invest in the defense Industrial's active ETF on his behalf. And again, crucially, this was shortly before we bombed Iran, a decision which Pete Hegseth was responsible for. Now, to be fair, they didn't go through with that investment, but not because they gained some form of moral clarity on the matter, but because it turned out they actually weren't able to invest, because that fund was not yet available for Morgan Stanley clients to buy. So that is why they didn't invest. At the same time, we also have no knowledge of whether they decided to simply invest in a different defense fund. For all we know, they could have just gone and bought another one. And that would add up because this is becoming something of a trend in this administration. Also, before we attacked Iran, Trump's children invested millions of dollars in military drone companies that had contracts with the Pentagon. We have covered that before. Before we attacked Venezuela, the new secretary for the Department of Homeland Security brought up a bunch of oil and defense stocks, again, that was before we went in and captured Maduro. Before Trump announced Liberation Day and tanked the stock market by one of its largest margins ever, more than a dozen government officials decided to sell significant amounts of stock at basically exactly the right time. There are plenty of other examples which I review in my latest newsletter, Simply Put, which you can read on substack at simplyput.profgmedia.com I go through all of the scandals that we've seen. But the point being, insider trading is now standard, ubiquitous, whatever you want to call it in this administration. So it's just hard to believe that the defense secretary wouldn't have gone and bought a different defense fund or perhaps other defense stocks after he had literally tried to buy it and gotten rejected by BlackRock. And again, he's down to do this because there are no consequences anymore. The SEC has been gutted, enforcement actions have plummeted, and the number of prosecutions for white collar crime have literally been cut in half. This is all by design. However, you know all of this because I've told you all of this before, but here I am telling it to you again because we are seeing the same news again. Another insider trading scandal, one of a series of insider trading scandals that have already been reported. Who knows how many scandals haven't been reported? But one thing remains pretty clear, at least to me , we have not seen the end of this . Okay, that's it for today. This episode was produced by Claire Miller and Alison Weiss, edited by Joel Patterson, and engineered by Benjamin Spencer. Our video editor is Brad Williams, our research team is Dan Shallon, Isabella Kinsel, Kristen O'Donohue, and Mia Saverio, and our social producer is Jake McPherson . Thank you for listening to Profit Markets from Prophet Media. If you liked what you heard, give us a follow. I'm Ed Elson. I will see you tomorrow