Risk Of A 10% Market Correction Now Uncomfortably High | Lance Roberts

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**Lance Roberts** (1:00)
Goldman Sachs had a target of 8,000 for the S&P by year end. That was about a 3% advance from where we were then. The outside risk is 10% down to the turn of the day moving average. So basically, you've got a 3 to 1 risk reward ratio, which isn't ideal for putting capital to work, which is one of the reasons that we rebalance portfolio, took some profits, those type of things.
I think we get a little bit more of a correction. We're not oversold yet, so we've got a little bit more work to do. I think next week, we may get some more pressure, particularly if interest rates kind of remain where they are. If oil remains around 90, then I think there's certainly some pressure to the downside.

**Adam Taggart** (1:44)
Welcome to Thoughtful Money. I'm Thoughtful Money founder and your host. Welcome you here at the end of the week for another weekly market recap featuring my good friend, the masochistic portfolio manager, Lance Roberts. How are you doing, Lance?

**Lance Roberts** (1:57)
I'm beating myself every day.

**Adam Taggart** (2:01)
So I say masochistic because you just told me, you're kind of angry at me and you can explain that. But basically, you-

**Lance Roberts** (2:12)
In a fun way, I'm not angry.
Look, we've got to be really careful because I get all these hate mails like when you and I each other. It's like, you're so mean to Adam, you're an asshole, whatever. And I'm like, dude, we're just joking with each other. Get over yourself. But yeah, so yeah, I'm mad at Adam and he's going to explain why, but not really, okay?

**Adam Taggart** (2:36)
Well, so it all comes down to basically you and your wife buying a new house, which I think is great and there's nothing wrong with it.
But you're planning on moving into the new house, correct? Yeah. Yeah. And I mean, I've talked about how this is the first time I've ever bought a house and the house is going to take about another nine months to be built before it's moving ready.
So the process is already overwhelming and exhausting me. And I just, you and your wife just went through this like two years ago or whatever, and you built a house and you totally customized it to exactly the way you guys wanted it. And now you're picking up and going somewhere else. I can't think of anything more masochistic right now than that.

**Lance Roberts** (3:19)
So first of all, you have to understand is that this is a way my wife and I've always worked. Since she and I have been together, our kids have probably moved seven times. Because we buy houses, we fix them up.
My wife is phenomenal at interior design.
It's not her trade, it's not what she does. She just has a really good eye and taste for stuff. And so we didn't buy this house we're in now. It's a remodel. It was a house built in 1960s and we came in and gutted it and fixed it up. But she did such a good job with it. You know, now it's very marketable. And so whenever there's an opportunity for us to make money on an investment, my wife's like, fine, sell it. We'll go do something else. We're not going to sell this house we're in, we're going to turn it into a rental. Because right now is not a good time to be a seller. If you're a seller in this market, you're getting pressured by high rates, there's plenty of inventory. So this isn't a good time to sell a house, but it is an excellent time to buy a house because high interest rates drive prices of houses down. You get a much better bargain on the house, and there's plenty of inventory on the market, where houses have been sitting on the markets now for six months, eight months, a year.