Ready to make some stock picks?
Tom Plumb, portfolio manager of the Plumb Balanced Fund, sat down with TheStreet to make some stock picks and to explain how he thinks that the Federal Reserve can improve their models.
Let's kick it off with the Fed.
Plumb wrote that "most economic data series that strategists and academics have been built on old models and don't reflect the disruptive effect of software as a service (SaaS) and the Internet of Things (IoT)."
So, when it comes to the Fed, how can Jerome Powell update the models to better reflect SaaS and IoT?
Here's what Plumb had to say:
"Well, they obviously are always working on them because I think one of the main things is that they're seeing that as the government's liabilities grow. Those are also considered everyone else's assets. You know, so somebody else owns that debt and they're using it for different purposes. And I think right now they're trying to put this all together, but again, for them to see less than 2% inflation with the type of deficits we've had and the accommodation we've had from the monetary authorities, I think it's just causing them to moderately change every one of these models," said Plumb.
But, of course, the Fed isn't the only thing on investors minds. Plumb's fund has started to pay close attention to the financial technology sector.
Plumb broke down why he likes MVP. And yes, that's an acronym for stocks, not "Most Valuable Player" and some other payment stocks that his fund is watching closely.
Watch to see what other stocks Plumb likes as we head into the final half of 2019.