halloween apple is promoting a scary fast event on monday night, many are speculating this will include a macbook announcement and the largest company by market value is also reported that third-quarter results "after the bell" on thursday as the highest weighted stock in the s&p 500 and the nasdaq it will move markets next week, we will be following a "mornings with maria" six to 9:00 a.m. eastern on fox business, i hope you will join me. i will see you at 10:00 a.m. on sunday morning for the "sunday morning futures". i will be speaking with gw law professor jonathan turley and exclusive interviews with ron johnson, byron donalds and virginia governor lynn youngkin, that is live sunday on fox news channel, that will do it for us on fox business. thank you so much for being with me, have a great rest of the weekend, i will see you next time. ♪ >> "barron's roundtable" sponsored by global x etf.

jack: welcome to "barron's roundtable" where we get behind the headlines ever. for the week ahead i am jack otter. coming up key data on the resilience of u.s. economy as investors look ahead to the fed meeting and third-quarter earnings all asked treasury partner richard saperstein on what stocks he is by now. it is now the time to buy bonds, yields looked tasty, the ten year treasury hitting a 16 year high of fiv 5% earlier this year expert panel will tell you how to play it. the transition to electric cars is not going so smoothly for some of detroit's biggest automakers, we began with three things investors to be thinking about right now. stocks sank by 1% as big tech earnings failed to impress, investors are now looking toward the fed wednesday meeting where it's expected to hold rates

steady. the second big oil merger of october is underway, chevron announcing it all by hess less than two weeks with axons deal with pioneer natural resources, should you add more energy to your portfolio. finally take a chance and roll the dice, why casino stocks could be a winning play, the bearings roundtable ben livingston, carleton english and andrew bary. not a pretty week on wall street, this time it is not rising yields letters picket investor. >> that is correct, we have a correction that the s&p 500 has dropped 10% from the peak earlier this year, it really is big tech that is causing the problem they came out with earnings and most of them did not impress particularly alphabet the parent company of google dropped the most 10% after reported his numbers. these are the stocks that carry the market higher all year long now they're driving it down. >> if those guys are down, look at the rest of the market, what

you see another earnings reports. learning has been pretty good so far, earnings are on pace to grow 3.2% from the previous quarter which is quite good coming in to the earnings season they're actually supposed to drop, for under sequential gains, that is great, the problem analysts are starting to cut the fourth-quarter earnings expectations, we might not seem the earnings growth, the market really needs out right now they need to be able to show that stocks can keep growing their earnings and that's what keeps them moving. if they can't we cannot continue problems. >> of especially with these evaluations, next week a fed meeting no rate hike expected. at the same time hire for longer we don't expect to cut anytime soon. >> nobody expects the fed to do anything, that's also a problem it doesn't mean rates will stay where they are in the market struggling with that. the thing that everyone has to keep in mind rate cuts are not necessarily good either. the fed rarely cuts rates out of the goodness of his heart, it's forced to buy something happening in the economy. what that something is is usually not good for stocks. jack: good news is good news and

bad news could be bad news. andrew, the high rates have met a lot less m&a and the economy in general but that's not true in the oil patch, we select on emerging with pioneer and chevron buying hess. >> big oil realizes something that they said decades ago, it's cheaper to drill for oil on the new york stock exchange and it is on the ground, will copies are trading relatively cheap right now. also big oils of the age of fossil fuels for decades to come in a hundred billion barrels a day and growing and climate activist pressure on oil companies is easing up finally, particularly in europe where it's a most intense. jack: what does this mean for investors. >> good news, oil stocks are trading relatively cheap, chevron which is buying hess hit a new 52 you week lot on the modest earnings, trading ten times earnings with a 4% plus

dividend yield more broad energy plays xle which is etf other ways include eog which is one of the best managed independent e&p companies in the world, petroleum which is warren buffett company and the canadian oil, hated by environmentalists but a hundred year reserve, if you like oil is one of the better place. >> energy is a very small% of the s&p 500 relative to history it could get a lot bigger. he mentioned warren buffett getting a bigger stake in petroleum why did he buy the whole thing, yes enough money. >> buffett said at the annual meeting he does not want to own all of the i'm not sure why, brookshire hathaway owns 25% he says he does not want it all but he said his view could change on that. jack: barron's has been looking at casino stocks, especially the regional one that got hammered but the author of our story sees an opportunity.

>> the worry people are going to want to gamble their money away, imagine but the regional casino place, they have a sticky clientele, they unlike las vegas or not to rely on conferences object to the local casino and also probably a number to call the regionals because some have online operations in some of those are turning a profit. jack: give us the names that teresa likes. >> we have to self-help, caesar's would be one by a security breach, and then you have penn national gaming which is trading at half of the five-year average on a pe basis, they are trying to recover with the deal that they have with disney/espn, the one that i'm more excited about is boyd's sold a lot of after posting earnings on trades pretty cheaply, it is a good fundamental story, their balance sheet is in good shape, they always have the capacity to return capital to shareholders which they happen to do. probably the safest that if we have a downturn.

jack: for stocks seem to hold up well in recession. >> inflation is easing as we head to the key federal reserve meeting cooling economic data that is boosting hope that the fed is done with the tightening cycle. richard saperstein on what we can expect in where he's investing next.

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jack: consumer spending fueled the economy in the third quarter this year gdp growing at the best pace in two years up 4.9% above estimates and more than double the what we saw in the second quarter and core pce inflation the fed's preferred measure of 3.7% year-over-year the lowest level in two years but well above the fed 2% goal.

joy to be treasury partners cio and barron's top rank advisor richard saperstein, think of her coming to the studio. i mention the great gdp. , if you look at the leading economic indicator, you see signs that are slow down on the way. >> clearly in the last year le eyes have been down, housing is turning lower, manufacturing is weak, bankers these are rising, credit card debt is increasing the undertow that the economy is slowing as a result of the fed dramatic and unprecedented increase in rates. jack: that means bond investors the opportunity, high rates are better, slowing economy means may be protection to be found in bonds. >> for the first time in 15 years the bond market is investable. advisors have gotten into the business in the last 15 years,

we've never ceded investable bond market, right now with tax-free yields at four and a half or 5% range, ten year high-grade taxable bonds in a five and a half or 6% range provides an interesting opportunity to diversify a portfolio while providing an interesting investment if the economy slows bond values will go up. >> the stock market is a little bit more trickier, the stocks have been powering this market higher few big cap tech names, you still think that they offer value, what do you like there. >> if we bifurcate the stock market and realize earnings, expectations for this year end next year heavily been coming down while this year stocks have gone up, the stocks that have gone up the magnificent seven that have driven arising multiple in the market. our view were overweight large cap tech will continue to do so on pullbacks like what were seeing now and at some point we will add more to those positions. if we look out over five years with a higher interest rate

structurally environment, we want companies that generate large amount of free cash flow and have low debt on the balance sheet. jack: some examples google, microsoft, depot comfortable with the stock. >> absolutely. >> and apple, the recurring cash flows, large moats around the business, the general sense of the transformation of technology and a.i. and all the aspects of that are embedded in the companies. jack: is there a danger that five years you could look back and say those were the nifty 50 of our age or do you think are more enduring companies. >> way more enduring think about google $106 billion of operating cash flow and 77 billion of free cash flow that is after all the x-uppercase-letter in r&d that their spending and embedding in these companies inch tremendous value that is not reflected in the income statement, i think

there is a long runway and a.i. could be very incremental and these are portfolio holds for quite a while. >> let's switch to a different part of the market, the barron's big money pull the favorite sector and the people that we surveyed was energy, you like the energy patch as well in a large evaluation there. >> that a second overweight, primarily because of the copious amounts of free cash flow that are being generated right now. >> is same logic but a different sector. different drivers. you can take the large-cap oil companies whether exxon or mobil generating free cash flow, that is after all of our expenses that they pay in x-uppercase-letter and exploration of roughly 10% on market cap and then you have other smaller producers where you can go up to 12 or 14% from cash flow, what are they doing with that, they're returning it to shareholders. an environment where market is going to be choppy and you have

geopolitical risks so you never know will happen to the price of oil seems like a good sector to be owning. jack: is a fascinating sector over the past ten or 15 years, oil prices were negative for a while, the street felt that there was too much cap expending, it looks like they got disciplined now. >> not only disciplined in the x-uppercase-letter but also in the geographic reach, they were taking a lot of risk in certain parts of the world and drilling and exploration and now as witnessed by the two acquisitions, they're bringing it more home so taking less geopolitical risks to extract and sell oil. jack: the u.s. is the world's largest producer. >> nothing wrong with that. have a good weekend. jack: treasury yields are levels that haven't been seen in more than a decade, the expert panel has advice for investors on how to get that fast it return

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jack: as interest rates rose fo, the value of existing low yielding bonds plummeted, 2022 was the worst year for bond investors since george washington was inaugurated. this should conventional wisdom has been interest rate that topped out and we at barron's have no exception, they just kept getting higher, the barron's cover story this week. give us a quick recap. >> bond yields have been going up ever since a bottom independent and every step along the way people have said these yields look good and they go higher and people keep losing more money and barron's has been guilty of this as well.

when darren and i who wrote the story sat down to talk about we try to figure can we go ahead and recommend bond again. we look at the map and we said yes we have to, one thing that stood out, this is the worst three year period since the 1780s, when george washington was a president the country was young trying to figure out if they could pay for the states debt, how it will pay for all of that, worse than the 1970s and if you look at the losses, it is incredible, all read it off, the shares of 20 plus year treasury lost 17% a year for three years, this is incredible. this looks like a time where you have to consider the potential that were at a point where these are going to produce going forward. jack: you don't have to be a market timer and nail the top and yields, right now you're getting a pretty good yield over inflation into a half% over inflation which is a nice time to get in.

>> you can buy short-term treasury, what we call bills and get 5% or more on them right now, that is great the risk that rates start to come down and you haven't lock this in. when you look at the longer-term treasury at this point there is some bond math that shows the risk is not quite what it was. if yields on these bonds were to go up another half a point, they would lose 3%, if the yields would drop half a point they would gain around 13%, that is pretty attractive. jack: that's a lot of complicated math, bottom line if you buy a bond at 5%, what happens. >> if you buy it 5% that's what you will get to look at historical returns, the worst, the better the bond market, the current yield is a lot better. jack: a lot of different ways that you can get into the bond market andrew if you want to

have treasury exposure, what is the best way in your opinion. >> several ways you can buy bonds directly from the government through treasury.gov website you combine bonds from banks and brokers and what are the best way is exchange traded funds at ets and you can get any maturity that you want i point to the fh why with a two-year maturity the ietf has a seven to ten year maturity in the tlt which is a 20 year plus gives you the most interest rates fall. >> i am curious it's tough to go against what you getting a guaranteed return on the treasuries but is the other parts of the bond markets that look interesting to you. >> the uni bond market is a popular area for individuals because of the tax benefit and are looking attractive with a long-term bond you can get 5% yields on long-term bonds like los angeles airport bond that i just noticed today, the tax equivalent yield is 8% or higher on that you can also buy closed funds including ticker nea and vanguard intermediate fund which is the largest fund and there are other ways including etf like the m ub as well.

jack: one important thing is where you live if you're new york or california resident were taxes are very high you probably want to state specific municipal bond fund so you actually get the tax advantage on both of your state and city taxes. let's say, i'm not worried about taxes i just want to be greedy, you can get mine% in the high-yield market, do i go there. >> it is tempting 9% sounds great. her taking on some risks. when you're looking at junk bonds, one thing to keep in mind, corporate bankruptcies are going up about 30% year-over-year. some may be based on when the economy was healthier a year ago but keep in mind, not exactly a place that you want to be. if you still want to get some of the yield, one fund would be to look at the strategic income fund not yielding 9% you're getting seven-point to percent yield, holding some clued companies like american airlines, goodyear tire, maybe

safer bets, that's good been actively managed bond fund that might not fit for everyone's portfolio. another way to play this is to look at the indexes, you're not getting active management, you are getting exposure in the low cost way and that would be something like the spider bloomberg, a j and k were high-yield corporate bond hyd. jack: a middle ground which is corporate in the 6% range, do you like l cutie. >> that's a great way to do it but don't own and a taxable account you get whacked on the taxes, put it in your ira or something. jack: thank you very much. ben and karlton, andrew, some u.s. automakers are stuck in the middle of the ev transition, stay right there. ♪ tourists tourists that turn into scientists. tourists photographing thousands of miles of remote coral reefs. that can be analyzed by ai in real time.

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♪ ♪. jack: stuck in the middle, andrew it appears there is optimism detroit auto companies might reach a deal with the union, it is still going to be a rocky road to the ev transition. >> tvs, electric vehicles may be the graveyard for detroit ford and gm went all in and the ev transition much to the light of the biden administration yet now they're paying the price repeat up production of ev spending billions of dollars a year for cars and americans don't seem to want, ford will lose $4 billion on tvs and you can't say how bad it is and scaling back their modest production goals of this

year. jack: you still have ford electric f150, the lightning, the stocks are supercheap at five and seven times earnings is this an opportunity to buy something that everyone hates or is it a trap. >> it could be a value trap of ford and gm and lightning sales already, gm is barely producing any ev's and people don't seem to want that, i would focus on bmw which is focused here favorably last week which has sensible ev strategy and the japanese automakers went slow on tvs with criticism through the climate activist but looking pretty good right now. jack: let's go to actionable ideas, what do you have. >> semi conductor they got hit when texas instruments reported tougher earnings but they're actually doing a lot of auto which is holding up well, 18% over the past three months city nonsupport, report earnings are on monday in if it beats the stock goes higher. >> if you like gm or ford is going higher. what you looking at carleton.

>> bank stock, taking a look at goldman sachs, this is one andrew and i sit next to each other trading just below book value which has been a good time to buy, we know the bank has had problems, they tried to get into retail banking, it did not work out so well, if you look at the last two quarters, kitchen sink in the massive influent personal financial management program, now it is about dealmaking needs to come back in golden is firing on all cylinders. jack: ceo david solomon says is out of the dj business for now he's focusing on banking. thank you ben, carleton and andrew. check out barron's.com don't forget to follow us on twitter or x at barron's online. that is all for us we will see you next week on "barron's >> from the fox studio in new york