>> wish we had more time but you've been lively getting her foster cross. thank you for joining me as a for us, i'll be back next week with more here on wall street journal. thank you for joining us. ♪♪ welcome to parents roundtable paris prepare you for the week ahead. i am jack. coming up, the collapse of chinese property worse than the brothers. later, hot investment opportunities in healthcare, cutting edge companies you ought to know about we begin the three most important things investors are to be thinking about right

now. i wildlife on wall street, china's largest property developer ever stops plunging early in the week over fears of a collapse market bounce back after news from the fed. facebook shares took a hit after social media giant said apple's privacy changes are hurting and fedex earnings don't deliver, shipping giant says labor shortage is driving up costs. my colleagues, thank levinson jack how. then, if you told me monday stocks would and week higher than they were a week ago friday, i could never have believed you've given that we have the fed coming up, all sorts of bad news. somehow they powered north, what was going on there? >> it looked like we were going to have that correction. fear china with a massive china property trust 25%.

senate just stopped. one talk to blames it on the fully invested there's investors who don't trust the market for one reason or another but the letters on stocks anyway so they start selling the first sign of trouble and trouble seems to pass and they rush back in. he went up with the market that basically does nothing for a week to make that's a funny line. i think leon said that not too many months ago and got attention for that. let's talk about the fence, powell took the stage and telegraphed caper is coming but they are not worried about it. >> the effect basically set finish in mid- 2022, powell discussed the possibility of rate hikes next year. to suggest it's ready to start with liquidity at least in the short term. big words will come as ends and investors start to look for things to begin. >> although he's a good telegraphing, maybe it's all baked and.

in case this week wasn't exciting enough, what are you looking forward to next week? >> i looking up at that ceiling and potential for the government to shut down. it won't be an immediate problem, we because turbulence but it will be a big problem once they run out of money and that will happen late october, early november. >> so facebook over the years we've talked about withering criticism from everything from amplifying information to literally live streaming a massacre and. powering higher. finally this past week, it's not invulnerable acutely skills usually advertising. facebook said a privacy change on apple's ios system on our iphone is affecting the effectiveness of attracting the advertising. facebook is purely in the advertising business to anything

we can fair in marketability, that's going to be bad for the company and sit for a while that wasn't the only bad news this week we got a bit of the ongoing coverage but then we also had facebook chief technology officer say he's planning to step down. to stay with the company in some capacity but that raises questions about what is next for facebook. >> no question about it in the back that they don't have hardware themselves they can't completely control their own destiny but of course being facebook, they put up stories about how great facebook is in the new york times reports they were amplifying. about 9% drop after they voiced concerns they don't have the people it needs to build. >> it had a much worse week and facebook what you were talking

about the stock market telling you your unpopular. earnings-per-share by morrison 10% and i'm not sure i would characterize it as unusual or nonrecurring in nature. there is a big expense increase from a higher cost for workers. investors call it wage inflation but workers just call it a raise. there were some inefficiency, too few workers at one key hub it raised cross there. medics didn't bring guidance down to come ten considering labor cost is going to pass but now it has a 90000 workers for the christmas rush and november to offset higher salary and benefit cost raising rates nearly 6% early next year.

that's fastest increase in eight years. >> fedex is often seen for the economy, can we extrapolate back? for the other companies face the same issues? >> demand is good, no one can find workers, everyone needs to pay them or. we've been looking for raises for decades now so we are finding them. the flipside is who will have master consumer inflation but the workers are also the customers at some level so maybe it's not so bad for the economy. >> let's hope that's true and let's face it, fedex is basically so i hope the packages get delivered this holiday season. coming up, chinese property developer ever grant is teetering on the brink of collapse. the follow-up be worse? doug ramsay raising next. ♪♪

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i mean for starters, porcupines are famously no good in a team setting. geico. save even more when bundle home and car insurance. , collapse of china's largest property developer even moment where should investors put their money? doug ramsay is chief officer and research cap with a devoted following on wall street, thank you for coming on this show, appreciate it. comparison lehman brothers in 2008, pretty dramatic, is it really that dangerous. >> i don't think so, one thing to keep in mind size matters. ever grant is the largest in terms of debt owed where's the men, not to make light of the situation but was the fourth

largest investment sink in the grass of the times i think it was an attitude like well, but this window into something really big up next down the road, we'll have firepower left breast ever grant is largest, there have been suspicions on its business models dating back to decade so i think that's an advantage if this doesn't come out of the work will it's been known and presumably scrutinized by authorities for a long. so i do think that's an advantage and i also think china is in a good position in terms of policy. it was barely scraped by covid. money supply growth is about as low as we ever seen out of china, only about 8% barely bumped up during posted so i think ability to flood the system with liquidity if need be, there's plenty of firepower.

>> but part of the u.s. my know you've got a lot of concerns about the u.s. market. in your time in the business, that's about 30 years, have you ever seen at this extensive? >> not broadly speaking. if you just look at the s&p 500, the largest companies in the u.s., they are pretty much on parts. somewhat show the u.s. more expensive than it was at the peak in 2000, somewhat show cheaper but they are about the same. what's different is the broad market, all the other large-cap, mid-cap and small-cap stocks, 5000 u.s. traded securities are more expensive on average than the top of the tech bubble which is 21 years ago very concentrated. today we have extensive evaluations across the list so that's a big difference from

2000. >> a lot of investors wants no caps, they made some money in 2000 and like xbox so if everything is overvalued, how far with the s&p 500 have to fall to reach you consider to be more or less pair value? >> like this one metric but based on a lot of different things, to exit over evaluation zone on the s&p 500 that would probably be a decline of 25%. i'm not saying it's going to happen conditions are good and liquidity is there and inflation is low although we don't have that anymore, evaluations can remain higher. if we were to go all the way back down average evaluations for loosing the last 25 years much more like a decline of a third so not a forecast but some perspective on how high

evaluations are in recent history. >> where should stock investors put their money? >> we are fairly conservative positions and we run funds that have a lot of latitude shift around equity exposure from 30 to 70% to give a sense, as high as 60% earlier this year. we are now at 53% so sort of around mid shading defensive in my mind and that's because of where evaluations are from even though we look at the economic cycle, we watched the fed, we certainly watch market technicals, we just concede that all that stuff, we still monitor but even then it's not that good and might not protect us from the rest of decline from these evaluation levels, we are just being sober about our own capabilities and i think it's worthwhile for most investors to adopt that mindset as well

because it's such a different economic cycle than anything we've seen before. >> we are out of time. i know you are not a gold bug but you would suggest how much of one's foliar info right now? >> i think four to 5% is reasonable. given the disregard the fed and treasury jointly have shown for the integrity of the u.s. dollar down the road that the dollar could lose reserve currency status, i'm not sure that's likely but given the monetary and fiscal juice return at what now is a strong economy, one would think it would put pressure on the u.s. dollar and perhaps foreign stocks which would benefit from a weak dollar to respond dollar weakness down the road. >> thank you for the suggestions, appreciate it.

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and practitioners which is good news for investors experts from barron's annual healthcare roundtable focus on driving healthcare innovation and we've got their stock picks. jack, this is an optimistic strike referred to as the century of biology's just begun, more is law a kind of acceleration, give us some of the good news.

>> that phrase golden age, for 15 years every drug treatment i've spoken with isaac windows golden age to? a lot of them said it's right around the corner. i feel like finally we are starting to seek some result. five years ago i visited regeneron, they talked about their platform graphic development of antibodies. during the pandemic we saw that for covid and we also saw mrna technology produce a very quick vaccine recovered some panelists now talk about technology mrna being used perhaps to treat cancer using the body's own immune system. one used the term holy grail to describe a vaccine that can prevent a bundle of respiratory illness, not just covid but the flu, rsv, lots of alzheimer's

treatment and trials right now. i know we had fda approval and doctors seem less than enthused about that one that eli lilly is an example in the late stage trial now, human gene with all sorts of diseases and for general and is a player there. artificial intelligence being used. one of our panelists described ai like the industrial revolution brought in pharmaceuticals. >> that all sounds great to me but investors are not that excited about it. you look at most of the big pharma comedies, they are trading whale below than the average stock. >> that's right, they have two problems. the first is a have remarkably successful drugs coming off in the future. they need to replace them, investors don't trust him to do that at least not at the current levels of innovation so you have cheap companies spending off a massive amount of cash.

you have a company yielding 5%. month more than tripled in a ten year treasury so maybe the outlook expressed is right, it's maybe not but you get a decent return as you wait to find out. >> luckily capitalism great big companies without crushing the pipeline. >> by better smaller companies. it's going to be part of what's going to help them along, they are going to look to buy for the pipeline they are sitting on piles of cash but will see them looking for smaller companies in a more strategic way and we may seek partnership. you look at pfizer and bio and were able to accomplish. pfizer have the expertise for shepherding it through the approval process. >> that was really positive news. let's go to some of the stocks.

start with the big guys. one of the big ones. >> 's the one fence spoke about, eli lily alzheimer's drug and then horizon computers with excitement around the thyroid eye disease drug. >> chris i believe is a j.p. morgan analyst. there were some smaller lesser-known companies such where investors who don't mind risk excited, they could be ten beggars if they hit it out of the park, where some of these companies? >> that's certainly the hope, a weight loss drug and another is athletic which is targeting eye diseases and we have bio chris pharmaceuticals, a rare but disorders. >> it's important to understand that if you don't want to take the single stock risks, we have

mutual funds you can buy an index fund that owns a lot of biopharmaceutical companies or an active fund manager. next, roundtable embers will get their own ideas for the coming week jack will tell us smart tvs are finally living up to their are finally living up to their name. ok, let's talk about those changes to your financial plan. bill, mary? hey... it's our former broker carl. carl, say hi to nina, our schwab financial consultant. hm... i know how difficult these calls can be. not with schwab. nina made it easier to set up our financial plan. we can check in on it anytime. it changes when our goals change. planning can't be that easy. actually, it can be, carl. look forward to planning with schwab.

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jack, the improvement in picture quality in recent years has been incredible. need to go to again when you're on your 75-inch? interface super come to, i can't they be like my phone and easy to use? what's going on there? >> they are, you have to take a fresh, the goal is dead. let me tell you, if you have

fire stick or a google chrome cast, they can turn jump tvs in trustmark tv. visio says now about 70% of viewing time is spent outside its own operating system. i spoke with their ceo and founder who told me he spent hundreds of millions of dollars on software it came off. they are in a position to go directly to advertising, streaming services display ads on the homepage rethink and go to car companies and detergent makers because they offer channels on their operating system. visio made a presentation advertising upfront and it cleaned up and that's one reason amazon had a missing tv. roku four years ago, that's enough the transition from hardware to apart from. time to let go and see what's

out there. >> that's a fascinating development, programmers are going to potentially be competing with a box in which they have been trying to programs they invented, ask for that. it's time for actionable ideas rate barron's tradition. what is your idea? >> taking a look at footlocker, a pullback on the head of that thursday from one of the times you might want to look to buy. we knew there would be supply chain disruptions i think it was a little oversold but also that means less discounting at places like footlocker everything about relationships between nike and footlocker that means when nike gets product out, footlocker will be the first place. >> thanks for that and then you put your money to great rotation, is that right trust. >> that's right, it looks like it's time to buy value stocks, the russell 1000, 2% over the past three months and 5% rise

but yields are rising. it may be time to play catch up. >> the reopening play, thank you for that. great i guess. to read more, check out barron's.com and follow us on twitter at barron's online. twitter at barron's online. let's - [mike] lumber, the cornerstone commodity that frames our everyday lives. it keeps the country as we know it sheltered, heated, furnished, and a whole lot more. but wrestling this raw material out of our forest and into our homes is not for the faint of heart. - ah! mother (beeping). - [mike] it takes old fashioned grit. - i'm not getting any power up there. - [mike] monster machinery. - a lot of people get hurt doing it. - [mike] and nerves of steel to do the most dangerous job in america. sorry, crab fishermen.