So there's going to be a shortage of capital and we're going to have bank
runs. I mean, so far, what the Fed's been doing is just
when the dominoes are about ready to fall, they arrange the White Knight to
come in, whether it's JP Morgan or Wells Fargo or who never to acquire
the bank and they take the losses. Is that more in the future here
or is there going to be an end to that as well? You're listening
to Carrie Letts's Financial Survival Network, where you get valuable information you just can't
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your free newsletter in gift Financial Survival Network now more than ever, and welcome.
This is Financial Survival Network. I'm your host, Carrie Letts. Well,
the Greater Depression you heard about it on the show for over a decade.
It got staved off in eight no nine, but perhaps there's no stopping
it now in twenty twenty three, twenty twenty four and on. What is
that going to mean for you? What is that going to mean for your
retirement? Where your investments. Our good friend Michael Markowski is with us now.
Michael, it's great to have you back on You find him at Alpha
tach tac k dot com. Michael, You've made some pretty amazing predictions over
the years. The September eight crash, the June sixteenth, June twenty sixteen
briggs It crash, the October to December twenty eighteen market crash, to kind
of go on and on, not to mention not just crashes, but the
January twenty two peak and the two thousand nine end of this secular bowl market.
So tell us what you're crystal Ball is showing you right now when based
on a on my most recent look at the inflation rate and the SMP five
hundred the SP five hunters dividend yield, I'm looking for the market to decline
from this level by the end of the year by thirty eight percent. Thirty
eight percent decline, which I should be the bottom, you know, less
something changes. That's what I'm looking for. Thirty eight percent decline from here,
and that's it's BacT that will you know. I can't tell you exactly
when that's going to happen. Like in my article that predicting the two thousand
and eight the bacco that came out in September of those seven when I predicted
all the brokers would collapse Lehman, bear Stearns, Merrill, Lynch, all
of them, and they did so. Yeah. So so I'm looking for
thirty eight percent decline UM and I'm b and uh and I'm looking for that
to cause a the US to go into that will be about a forty six
or seven percent decline from the peak. And you need a forty five percent
You need a forty five percent decline to UM, you know, to be
one of the ingredients for the U, for an economy to go into a
depression of the stock market. So yeah, I'm expecting I'm predicting that we'll
see that, you know, happen. Well, it's entering this thing by
the end of the year. That great. There any way to print their
way out of it? Is there anything that they can do to try to
mitigate this? Uh not? Within that with inflation, you know, the
ft is you know, did not have an inflation problem in two thousand and
eight. They didn't have an inflation problem in two thousand and twenty. Now
they've got an inflation problem. So no, it's not that they can't the
gap creft the money. It's it's politically we have an election year coming here,
twenty twenty four, and it's it's politically incorrect right now to launch more
stimulus. Okay, we've already launched a bunch of twenty twenty We've also we've
rent up the national death significantly, probably doubled it or tripled it since two
thousand and eight. So there's no cushion. And the problem with it is
the politicians. They're going to argue that it's going to raise inflation. Everybody
that everybody knows if you can you bring in stimulus, it's it's going to
maintain or increase inflation. So they've basically got new exit strategy here. There's
nothing that they can do. If the US goes into the Great depression,
greater depression as many called it, the rest of the world follows us.
Correct, that's right. And so you know my articles, um my article
about the cash flows in video which you're on that alphatack dot com talk about
that will link to the show notes that came up that that is, you
know, the cash blows for the biggest companies Amazon, Google, Facebook,
all of them are slowing. Um. After after having you know, a
momentum, you know, order at the year after year up increases, they're
slowing. That's one of my articles that you know, so I came out
and made this prediction that we'd go into a depression a year ago June of
twenty twenty two, and so I've had a cash flow is now operating.
Cash flows for the biggest companies are now increasing the probability of that happening by
the slowed down of the cash flows. Um. The second thing is the
regional bank crisis. The regional bank crisis, as UH has caused day another,
it's another's big problem because it's that's going to put a damper on real
estate, commercial real estate and construction and all of that because of the regional
banks or the shares are under pressure. They've had one after another. However,
they be rescued. People are moving their money out of regional banks and
into the big banks. You know, there's only forty three banks that have
been stress tested, and those are the biggest banks, and so you have
forty seven hundred that have it been So if you're a business and you have
a couple hundred thousand in the account to make your payroll. And you're a
regional bank, You're going to say, what do I do if this regional
bank has to go out. I can't wait for the FDIC they've come in.
I've got to move my money. So the point is the money's flowing
out of the regional banks into the big banks, and that's another big cause
for a depression, you know, So there's going to be a shortage of
capital and we're going to have bank runs. I mean, so far,
what the Fed's been doing is just when the dominoes are about ready to fall,
they arrange the white Knight to come in, whether it's JP Morgan or
Wells Fargo or never, to acquire the bank and they take the losses.
Is that more in the future here or is there going to be an end
to that as well? Well? Actually, JP Morgan just came out the
day and said that they're not they're not buying any more these any more of
these regional banks. They're not putting any more money in them. So that's
no longer an option. And you know everybody, JP Morgan is the kriminal,
a krem of all the banks. So you know, if Jamie Diamond's
not doing it. There's no pressure political pressure on anybody else to do it
either. So I don't see the banks or the big banks rescuing little banks
and uh. I think it's just going to be a continuous problem. And
it's a serious problem. So we're going to see a bell out. What
are they going to do? They can't just let the system go down,
even though the years to be what it's what's happening? Uh? Do they
just take all the deposits and they put them into fed coin and just wipe
out everybody else? Is that what's going to happen. I don't know about
fed coin, UM, but I think that you know, they're just you
know, help the banks are until Congress comes in and increases the fdiics.
You know, if that that's another issue, that's another problem. You've got
to get Congress to come in and increased the amount of money and the FDICS
accounts. So this is a serious problem, you know, the bank issue,
I would say the number one problem the regional banks, UM and UH.
And the problem is is you know, the bank runs, it's you
know, it's not like you know, you go back to the nineteen twenty
DONI there are a thirty thirty one, thirty two. You know you had
to go stand in line to get your money out of a bank. You
know, they had bank holidays where the President Roosevelt basically declared a bank holiday.
He said, oh, listen, we're gonna have a week. We're
gonna have a week where the banks are closed so that people couldn't withdraw their
money from the banks. Now you're in a situation where you can just you
know, online, go in there and move your money instantly out of your
banking into another bank. Yeah. Where are you gonna move it too?
Though, You're gonna move it to JP Morgan, You're gonna move it to
Wells far Ago, You're gonna move it to Bank of America. But again,
there's carry there's forty seven hundred banks. Okay, we can name where
everybody all of us bank. We can name on two hands, probably everybody
in your audience where they bank. I mean ninety percent of the people.
Maybe some people have a regional bank account. Do you have a regional bank?
Who do you have a big bank account with. I'm at Wells and
City, I'm at Wells Fargo. Okay, So my point is is that
they're moving the money into these big, big and it's it's really it's a
it's they didn't think about this and when they came up with the Dad Frank
and the problem because now you have a good house. You know, you
have Wells Fargo, you know your money safe there. You know it's safe
at City Bank. You know what's safe at Bank of America. You know
it's safe at JP board where now? Right? Yeah, But the point
is that the banks have been stress tests. They're stress test every year.
They make sure there's enough money in them. So we could go into a
situation where just about you know, where the government was a highly regulated banking
industry with a few banks is where it's probably where it's going to go by
the end of the decade. Yeah, a lot of the banks will just
disappear. I'm going to get there, though, what how are we going
to get there? It's not going to be pretty, is it. No,
it's not. It's going to be very very it's going to be very
difficult and very volatile, extremely volatile. Yeah. So do we eventually get
deflation here? I mean what we're seeing is M two eroding, right,
Yeah, as it's going down that's the measure of the of the money in
the circulation and banks and all that. Well, I definitely, well,
I definitely think we're going to see deflation. I've did, you know,
you know, I to come up with my projections, my thirty eight percent
declining for the SP five hundreds based upon the SP five hundreds, my research
of it a dating back eighteen seventy one, and it's diving yields under inflict
during inflation every periods. And in that, in that whole research I did,
I also found all the periods where there was deflation for an extended period
number extended number of years. So yeah, I believe that we're going The
FED has lost control and because of the mistakes they've made in twenty one to
twenty twenty two that you're on my website. Okay, there's an article about
that Fed's mistakes too. They've made true policy errors. Um you know they're
not they've made they made the mistakes and they've lost control and in the everybody's
ill lose faith them. Now, Okay, so you know, when this
thing goes into a depression that wasn't supposed to happen, I don't know what's
going to happen to the FED, you know, because they were supposed to
be the stap of the stop gap, and they made two serious mistakes,
and so we go back to a highly volatile period of rising prices followed by
de flight declining prices. You know. I mean they're back in the late
eighteen hundreds, early nineteen one. Ord you have five years of deflating prices
followed by five years of inflating prices. It was very difficult to do business,
very difficult back then and will become very difficult in the future. All
right, So what is you as an individual investor? What are you supposed
to do in the face of what we're up against here? Besides moving your
money to Wills Fargo or jp Borg in Chase Well investors really need So this
is a big problem. Investors need to change their mindset to First of all,
buy and hold. Forget about it, okay, I mean buy and
hold is works at burin secular bull markets, which had ended in January of
twenty twenty two, assorted in two thousand at night, and in a secular
bull starts at the bottom of a secular bearing. You just buy and hold,
and it's like autopilot, like we were talking about the Tesla. Okay,
So what happens. You've got to go to you have to switch gears,
and you have to get out of the buy of old mentality. You
have to look for a return of capital, not return on capital, because
prices are going to go down. Thirty eight percent is when I'm looking for
a decline for the SP five plunders. So you're going to be able to
buy thirty eight percent lower. Okay. So you want to be in cash
when it's saying hits bottom, and when hits bottom, while be on your
show and I'll ring the bell. Okay. But the point is you want
to be in cash, and you absolutely want your money in long short hedge
funds. Okay, because if you put your money in a long short hedge
fund and from nineteen twenty nine to nineteen thirty two that basically bought the dips
and sold the peaks short. Okay, from nine twenty nineteen thirty two,
you made over six hundred percent on your money. If you've bought and held,
you lost eighty five percent. Okay. Same thing happened with the NASDAC
and you know two thousand to two thousand and three. Okay, if you
if you'd been in, if you had if you had traded the market short,
I mean the NASDAC went down seventy eight percent during that time period in
two thousand and two thousand and two. And then during that time period you've
made over five hundred percent by you know, by buying the dips and selling
the peaks. So you want to have money in a hedge fund, okay
that goes long and short the market. And if you're if you're missing out,
if you don't have your money, and that and that's what we do
at Alpha Attack. We have that we have algorithms. The same algorithms that
I use to predict the peaks I mean the peaks and the troughs for them
for the market can be used to trade the market. So they have a
dual purpose. All right, So that's one thing you could do. You
stay cash heavy. Well, you put you know, especially older people,
people over fifty fifty five years old, they should absolutely put a significant portion
of their portfolios into you know, government bonds, two year government bonds and
of a government that has a double A plus or better credit rating, which
would include the US. What's your land, Finland, suite most kind of
countries, you know, because you want to be in it. You want
to have your money in something at a government bond in which the government has
the ability to leave the attacks against its citizens to pay off its debts,
to pay off its debts. Like in back in nineteen twenty nine, after
the twenty nine thirty two tobacco the tax rates in the US or an income
tax rates went to as high as seventy seventy some one percent and stayed there
for years. So that was at that enabled the US to always pay So
if you're in a country, if you're in an Eastern Bloc country or a
South American country that can't collect their taxes and you've got the bonds, you're
in trouble. You know, if you don't have a taxpayers are willing to
accept the higher taxes and pay them. So that's why you want only those
countries that have double A plus bond rates. And you want two year bonds
because you don't have interest rate risk. So if interest rates skyrocket in a
two year bond, you'll be okay. Right, So two year bonds or
makes sense. So now I see some banks are paying four and a half
percent interest do you take it. I'd rather have the well again because of
the banks. You understand, the banks are all trying to get more deposit
money, so you know, the regional banks will give you a higher deposit
rate, but I think you're getting their their rates are comparable to what they
to your treasury bills. So I think you just you you either buy your
your treasuries from the bank where you buy it from your brokerage firm, your
online broker. I think you're much smarter to be in treasuries than banks than
bank deposits. So what about money market funds that invest in treasure Money markets
are okay as long as they're invested in treasuries, but you're not going to
get the higher yield on those generally, right, gotcha? Yeah, So
better off going direct to the treasury yourself. I mean, I think look,
I think it's important, you know, because of the volatility of the
markets. If someone puts their money in a money market fund, there's that
tendency to jump in when the market sells off big okay, and put your
money back in, and then you get killed okay, because it's going to
continue to write it down. So if you're disciplined to say, you know
what, the next two years could be tough, could be rough. Let
me be defensive, but a good percentage of my money in a two year
government and a note, you're you're you know you're gonna. It's a decision
you're making. You know that's more defensive. Okay, you're gonna, you're
You're not gonna have a tendency to turn around and sell that note three months
later. You need to be conscienties. That what investors have to be.
They have to be conscienties and discipline, discipline, conscientious and cautious. Right,
if you look these hedge funds, we're looking at big returns. We're
looking at you for three, four or five percent returns over the next couple
of years. If you're if you're a long short hedge fund, that's what
kind of returns you're looking for. So if you put twenty percent of your
money into that thirty percent of your money and that seventy percent of that seventy
percent of your money into notes, and I also recommend venture capital deals,
but you know, we can give invent a minute. But I've seen the
hedge fund should been able you to generate a higher return in these volatile markets,
and you would have if you were fully invested, one hundred percent fully
invested in the stock market. All right, so you have to embrace the
volatility. Care everybody has to say, Hey, I've never done this before,
but I need to embrace the volatility. I need to put a portion
of my assets and a long short hedge fund. Okay, because you're those
who do are going to It's shown over time you make you make a hell
of a lot of money, right Okay, Well interesting, So hey,
what can people get when they go to your site Alpha tech dot com Michael,
Well, they can get sign up for our I mean, you could
get access to hedge funds, investment advisors that have access to these hedge funds.
And I have a weekly session every Saturday morning that I have that for
my uh you know you can that's for you. So we go over these
things every week on a Saturday morning at eleven am. You can sign up
for that. You could sign up for our alph attack intel alerts, another
thing can sign up for. So there's plenty of things to sign up for
on the site. And there's also educational information that's we have an information about
all that you know secular bear markets, which I highly recommend every investor view
the videos about secular bear markets because the market is secular. We could have
a whole show next time just on secular, on secular and excliting that we
could I could get a whole interview on that. Yeah, something that many
of you out there weren't even alive for the last real secular bear market.
Yeah. Really in the seventies when the nifty fifty crashed and burned, right
right, you had those one decision stocks they called them. You bought Kodak,
you bought both rights IBM, and you held them for life and you
could retire wealthy. Right, that's right. Let's see how that worked out.
Huh Yeah, all right, Well, interesting times ahead. Ache.
We'll have a link to Michael's site on Financial Survival Network dot com and the
show notes this interview while you're there, to make sure you sign up for
your free newsletter. Really appreciate you coming on, Michael. If you have
a question for Michael myself, shoot me an email al Atcarrey Lutz dot com.
Write your comments on the YouTube channel below, and we will address some
of them. Michael, thanks for stopping by. We'll talk to you soon.
Okay, thanks Carry, thanks for listening to Carrie Lets's Financial Survival Network,
your solution to today's trying times. For the latest, go to Financial
Survival Network dot com. Financial Survival Network now more than ever,