My dad grew up during the Great Depression... He was the son of a tobacco farmer in southern Virginia, the oldest of six kids. As you can probably imagine, growing up back then meant dealing with a lot of financial strain.
He was the son of a tobacco farmer in southern Virginia, the oldest of six kids. As you can probably imagine, growing up back then meant dealing with a lot of financial strain.
Many times at Christmas, my dad would remind my siblings and me about the year his only gift was an orange.
As difficult as things were, my grandfather was able to take care of his family.
Grandaddy Jim started out as a sharecropper, working other people's land. Poor farmers were sharecroppers because they couldn't afford land of their own.
Yet that system often trapped families in debt. Farmers had to borrow money or supplies just to plant each year's crop, then pay it back from a harvest that might not be big enough to cover the debt.
Grandaddy Jim tried to save money and buy his own land, but it was never enough. And having six kids only made it harder.
Finally, my grandmother convinced him to borrow the money instead. It worried him terribly.
My grandfather was deathly afraid of going into debt.
But in the end, it all worked out. Grandaddy Jim was able to work his own farm and care for his family.
My grandfather's success with borrowing to own his farm even inspired my father in his career. My dad ran a small-town bank that lent money to farmers buying land.
I've been blessed in life, and I owe it all to these two men. My grandfather's success led to my father's success, which led to mine.
These two men have also had a profound effect on how I think about money...
The Wall Street legend who called the 2025 crash – 13 days before it unfolded – has a dire new warning for August 26. A sell-off could soon sweep 95.7% of stocks, while a new bull market could begin among 4.3% of AI stocks. See his full evidence here, including four free recommendations.
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There is a wide spectrum of financial statuses. At one extreme, people find themselves deeply in debt and going broke. At the other extreme, folks are well off and have enough money to retire comfortably.
Here's what that looks like on paper...
Luckily, I've never been close to the left side of this graph. But as I get older, I do worry about how far I am to the right.
And that shapes how I think about risk in stocks. Every stock I buy comes down to the same question my grandfather weighed before that loan...
Will I lose everything?
Whenever you buy a stock, there's always a chance you lose big – maybe even everything. And yet... there's also a chance you double or triple your money.
That's the thing about stocks. The same bet that could set you up for life could also sink you.
But we get to choose the bets we take. The key is to take the ones where the risk is worth it.
Tomorrow, I'll continue this conversation and talk about one stock where the risk doesn't look worth it. And on the flip side, I'll discuss some signs in three other stocks that can help investors find risks worth taking. Stay tuned.
Good investing,
Joe Austin
P.S. Last week, Chaikin Analytics founder Marc Chaikin and I went on camera to share an urgent message about a major "disconnect" underway in the market right now...
This disconnect could unlock the biggest AI moneymaking opportunity of the next 12 months.
In this broadcast, we discussed how to find the best opportunities within this situation. At the same time, we explained how to filter out the stocks to avoid at all costs.
If you haven't had a chance to watch the broadcast yet, don't delay. It goes offline tomorrow at midnight.
— According to the Chaikin Power Bar, Small Cap stocks and Large Cap stocks are somewhat Bullish. Major indexes remain all bullish.
* * * *
Sector Tracker
Sector movement over the last 5 days
Health Care
+4.33%
Energy
+2.79%
Materials
+1.90%
Staples
-0.12%
Discretionary
-0.15%
Real Estate
-0.42%
Financial
-1.17%
Communication
-1.37%
Industrials
-3.36%
Utilities
-3.48%
Information Technology
-3.53%
* * * *
Industry Focus
Homebuilders
0
18
15
Over the past 6 months, the Homebuilders subsector (XHB) has underperformed the S&P 500 by 20.77%. Its Power Bar ratio which measures future potential is Very Weak, with more Bearish than Bullish stocks. It is currently ranked #22 of 21 subsectors and has moved down 1 slots over the past week.
Indicative Stocks
BLDR
Builders FirstSource, Inc.
CARR
Carrier Global Corporation
DFH
Dream Finders Homes, Inc.
* * * *
Top Movers
Gainers
HOOD
+13.70%
MRNA
+8.86%
COIN
+8.20%
FCX
+7.64%
ALB
+6.75%
Losers
MRVL
-5.57%
SRE
-5.14%
EIX
-4.11%
AEP
-3.79%
CNP
-3.56%
* * * *
Earnings report
Earnings Surprises
BJ BJ's Wholesale Club Holdings, Inc.
Q2
$1.36
Beat by $0.19
BKE The Buckle, Inc.
Q2
$0.87
Beat by $0.06
* * * *
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