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Everything going on the markets right now, that's not add up to what we've

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seen going on in the world.
Right China's economy is half of what it

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was a year ago as far as
their gross domestic product. Our economy is

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slowing down. Europe is slowing down
drastically. What is going good? What

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is going right? What would tell
you looking at the asternal figures that this

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market should be going up? Well? Tesla is doing well? Right?

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You're listening to Carrie Letz's Financial Survival
Network, where you get valuable information you

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in today's trying times. You need the

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Financial Survival Network now more than ever. Go to Financial Survival and Network dot

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gift. Financial Survival Network now more than

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ever, And welcome you are listening
to and watching the Financial Survival Network.

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I'm your host, Carrie lets Well, what are we seeing the market?

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Is it going to melt up or
is it gonna melt down? I think

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everybody is wondering about that. We're
close to peak than the dow. Hey,

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let's talk with our good friend Russell
Stone. Get your take on things,

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Russell. It looks like everybody has
a funny thing happened on the way

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to the recession. Everybody foot,
everybody has forgotten that there was going to

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be a recession. Is this just
hopeful wishful thinking? Or have we dodged

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the bullet here, Russell, We
have not dodged the bullet night at all.

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The metrics and the data that people
chase after are very highly manipulated.

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Think about this, right back,
say twenty thirty years ago, who was

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the investor competing against in the marketing
place? For christ, they were competing

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against pretty much themselves in the performance
of the companies that they're buying. But

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now you're competing against algorithms. They're
competing against day traders, they're competing against

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high speed computers. There's competing against
just thrive quite honestly in a lot of

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areas. So the average investor is
looking at a rising market that they have

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no chance of really been able to
be successful unless they guess correctly, or

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if they go long term and then
just cross their fingers and hope for the

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best. Everything going on in the
markets right now does not add up to

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what we've seem going on in the
world right China's economy is half of what

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it was a year ago as far
as their gross domestic product. Our economy

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is slowing down. Europe is slowing
down drastically. What is going good?

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What is going right? What would
tell you looking at the esternal figures that

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this market should be going out well? Tesla is doing well? Right,

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take away six stocks out of the
Dow or the SMP five hundred and the

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whole thing collapses. Take away one
or two stocks. You take away Tesla,

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you take away Apple, you take
away any of the large six major

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drivers of the NASSAT and the down
in the SMP five hundred, and everybody

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else is doing negative or flat right, There is no no impressive. Everybody's

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chasing after the six that are leading
the way. You're you're sounding downright pessimistic

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here, but as we're talking,
hey, it's the first day of August.

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We had a nice rally in gold. Golds down twenty three bucks announced.

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Now silver is down half a buck. Where do you do you put

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it into metals? I mean,
the medals have been they have been strong

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as of late, but they're not
trading at record levels right, And my

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viewing medals is this, I'm not
buying metals right now, precious metals from

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my own portfolio based on what I
think the price is going to do in

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the next week, two weeks,
or a month or even two months.

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I'm buying it for walk term.
I'm focused on the dollar. What is

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going to happen to the dollar in
August twenty second when the bricks nations getting

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and decide their next move right right? If you really think that the dollars

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on solid ground, then I would
think again. And if you don't.

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If you do think the dollar is
a kept me that it's being attacked by

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the brick dollar or in other courses, do you really need to prepare fed?

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How do you prepare that crisis?
Metals silver over gold? Because the

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ratio was eighty three to one right
now? Well, whatever happened to that

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saying sound as a dollar? Well, when the elevated goal to a Tier

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one asset right next to the dollar, that was the clear signal that we

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better start moving in another direction the
dollars. Where does the strength of the

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dollar come from? Is it because
of the goal that backs it? Now,

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there is no goal that backs it. Plant my point the fact that

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it's accepted. It's like your credit
card, your American Express or master card.

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It's accepted worldwide. Right, But
why is it accepted because they have

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good faith that American Express will pay
the bill? Right. Well, we're

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thirty two trillion dollars in dead The
interest on the debt alone this year is

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going to exceed a trillion dollars,
bigger than our military budget. Right.

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The unfunded liabilities add up to one
hundred and ninety two trillion dollars. Right,

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So where's that faith going? All
right? FDSC Insurance has one point

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two pennies stored up for every dollar
that are obligated to protect. How much

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face do people have in the banking
system? I don't know. You're making

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me feel a little downright pessimistic here
or else? All yeah, but look

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at the end of my notes carry
all right, what does it say?

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Right? Said? Bye bye bye? But when a year a year out,

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maybe eighteen months out, with markets
shed all this excess debt and the

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world has returned to a normal valuation. Right, The valuation of the side

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market was greatly inflated when the interest
rates were held low. Incorporations were buying

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back their own stock with their own
money borrowed money. Yeah, a low

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rates. It guts. They can't
do that orbitrage anymore. Artific should be

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boost their per share earnings, and
therefore the share price would go up,

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and all sorts of great things happened
if you were in management right. Correct.

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And one of the things that people
throw up there all the time is

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that the government just prints money.
The government can't adjust print money. They

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only can print to the demand through
the commercial lending banks. So the commercial

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banks are not lending too corporations.
They can't print money. Right. But

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look back at the three months and
the six month friends and the treasury the

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t bills, right, and you
can see last month that the Fed was

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not going to raise indust rates because
the interest rates did not go up.

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You can see last month or you
know, this current month when they did

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raise them, the interest rates started
to go up again. The February serve

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only follows the market, they don't
precede the market. Right. So if

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you just attract the three into six
month treasury bills, you will understand what's

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going to happen at the Fed.
They're going to raise the indust rates as

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the indust rates continue the client Okay, so you don't see any end in

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sight for interest rate increases, they're
gonna be there's gonna be a series of

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increases, pauses, increases positive.
But when fear enters the system and the

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fear of default within the system starts
to elevate, you're going to see the

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X start to react to that,
and people are going to start to demand

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a higher interest rate for the risk
that they're taken within the bond market and

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stock marketing. So then that's going
to result in I guess the stock market

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coming down because you're going to get
a higher quote unquote risk free return in

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the bond and fixed income markets,
right, yeah, because think about it.

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If you can get a higher yield
by going to quality bonds, individual

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bonds that pay a higher yield,
right and get a six seven eight percent

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you know, look at all the
people going after government treasury funds that are

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paying five percent right now, Well, bank can compete with that, they

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can't. Hey, And we see
that the amount of loans they're making is

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dropping dramatically. Loan standards are higher, and as these regional banks each one

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goes under, there's less yep.
Interest in making in making wise loans to

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growing enterprises, in my mind,
was a purpose of the banking system in

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the first place. Russell, right, absolutely, I mean there should have

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been higher standards. In Canada,
you have to put twenty percent down and

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the longest you can finance a house
for is seven in fifteen years, correct

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me if wrong, but it's no
longer than fifteen. Most of the houses

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are finance on a seven year don't
why you have equity in it. It's

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less likely that you're going to walk
away from the property. People in America

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can still finance ninety seven percent of
the properties right in a lot of cases.

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More right doesn't make sense. It
just makes it easy for them to

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walk away. Think about the used
car market. Right during COVID, if

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you qualified for a stimulus check,
you could go in there at twenty four

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years old, say, and borrow
thirty thousand dollars to buy a Mustang or

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a Camaro, and you wouldn't have
to make a payment for two years.

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Those payments are now being expected,
just like the student loan debt. You

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realize that the largest asset on the
US balance sheet is student loan debt.

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Isn't that crazy? The largest asset
is debt that is hamstringing our young people

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from being able to go out and
participate in the economy. Hey, so

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what's your thought about housing, Russell. You know, so many of you

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out there bought new homes, upgraded
whatever over the past five years of low

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interest rates three percent interest rates,
and now like, I would like to

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downsize, but it's going to cost
me more to downsize than it and it's

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costing me to stay where I am. Yeah, my convonces to those people

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buy houses in the last three years, they're in a predicament. They're gonna

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be underwater no time. Hopefully you
didn't put a lot of money down on

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the house. But if you're if
you're in a position where you put a

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lot of money down and you need
that value to be intact, you've got

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a tough decision to make exit out
of that house and into a smaller house,

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or even rent a house for a
year or for a while the house

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and prices come down. Uh,
that is not a bad maneuver. Sell,

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rent by Yeah, well, you
know, you know then you have

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to move. You're gonna have to
move two times, you know. But

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look at the long term. The
biggest for stakes that people make is with

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the real estate. All right.
Uh, they one day think that real

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estate is an investment. It's really
just a bad savings account at the end

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of the day, unless you're flipping
houses for a living. But this is

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one of those tikers where if the
value of the stock market goes down to

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the percentages that we think it's going
to and the real estate market goes down

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similar to what it did in twenty
ten, then you really want to make

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00:11:01,840 --> 00:11:03,759
a tough decision of bold decision as
to what you want to do with your

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house, and if your kids are
on the way to college, you can

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downsize. I'm going to that right
now. My house is going to the

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market in a few weeks, and
when it does, I'm hoping that it

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will sell at a good price,
but also that the sale would get to

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the closing, because you've got to
hope that something doesn't blow up in the

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world that will stop the banks from
freezing those loans and saying no, yeah,

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00:11:28,039 --> 00:11:31,480
Well, banks will always want to
loan on real estate for some reason

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00:11:31,519 --> 00:11:35,879
that I can't understand, but I
guess maybe the fact that virtually all of

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00:11:35,919 --> 00:11:43,320
the home loans, certainly in the
affordable areas, are basically guaranteed by Uncle

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00:11:43,399 --> 00:11:46,720
Sam. Yeah, but when the
four closes will start to build up,

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00:11:46,759 --> 00:11:50,960
and Uncle Sam is paying you five
percent plus not to loan money out in

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00:11:50,039 --> 00:11:54,000
the interbank lending. Right, Why
on earth am I going to go out

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00:11:54,000 --> 00:11:56,759
there and take the fault risk.
When I can earn five percent and do

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nothing, I'll just come back from
my staff and cut down on my expenses

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and write it out. And when
I can buy those houses at rock bottom

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00:12:03,279 --> 00:12:07,279
prices, that's fine. Well,
I think one point you're missing here,

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00:12:07,360 --> 00:12:11,919
Russell, is we're never going to
have a foreclosure crisis like we had last

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00:12:11,919 --> 00:12:20,519
time, yelling we might have millions
of people underwater in their homes, but

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00:12:20,080 --> 00:12:26,159
you know, there's no appetite in
this country, uh for millions of foreclosures

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00:12:26,240 --> 00:12:33,039
like we had last time. So
just like they've normalized shoplifting and legalized it

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00:12:33,120 --> 00:12:37,559
in a bunch of places around the
country, basically you'll stay in your home

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00:12:37,600 --> 00:12:43,000
and they'll they'll do a workout,
there's just not going to be these foreclosures

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to kind of I'm telling you politically, the Congress is just not willing to

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take that hit again. Yeah,
but my problem, insist is that we're

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kind of at the end of the
rope of kicking the can down the road.

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Where is the government going to get
money if if the foreign countries are

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not borrowing our treasury to create a
pair of dollars, how is the government

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00:13:03,600 --> 00:13:07,399
going to pay their bills? Because
the world line's up to buy oil in

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00:13:07,480 --> 00:13:11,159
our dollars. If Opex says we
no longer require the world just to use

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00:13:11,200 --> 00:13:15,799
dollars, it will allow them to
use brick or euro something else. Guess

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00:13:15,799 --> 00:13:18,559
what. The government's not gonna have
a whole lot of money to work with,

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00:13:18,000 --> 00:13:20,600
and they're gonna have to print money
in order to make it happy.

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00:13:20,799 --> 00:13:24,879
Yeah, well that's why the attriu
believe is inevitable. Yeah, it's not.

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00:13:26,080 --> 00:13:28,679
In my opinion, it's not doom
loom. It's opportunity. Right.

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00:13:30,320 --> 00:13:33,320
This correction is going to recalibrate the
value of everything that we see, which

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00:13:33,399 --> 00:13:39,559
is greatly distorted. So like watching
everything with big co classes, everything's distorted,

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00:13:39,919 --> 00:13:41,279
right, But now all of a
sudden, we're gonna have twenty forty

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00:13:41,320 --> 00:13:45,679
vision when it comes to the asset
value of things, and then the investments.

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We're going to come back into the
market like they did in nineteen thirty

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00:13:48,440 --> 00:13:54,399
two, and they're gonna we'll have
happier times. Cash the king guys Yeah,

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00:13:54,440 --> 00:13:58,320
it's like Lauren Buffett said, you
don't know who's swimming naked until the

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00:13:58,360 --> 00:14:03,360
pide goes out, right, correct, absolutely, all right, great people

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00:14:03,360 --> 00:14:07,320
go out with the time. So
you've given us something to chew over here,

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Russell, appreciate you coming on.
Best place to find you is Scranton

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00:14:13,360 --> 00:14:18,399
FG dot com. Right all right, and there's a link in the show

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00:14:18,440 --> 00:14:22,559
notes to this interview on Financial Survival
Network dot com. Just go there,

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00:14:22,639 --> 00:14:26,840
sun up for your free newsletter.
Russell. Always a pleasure, Thanks so

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00:14:26,919 --> 00:14:33,159
much, Thank you, thanks for
listening to carry Lets's Financial Survival Network,

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00:14:33,360 --> 00:14:37,840
your solution to today's trying times.
For the latest, go to Financial Survival

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00:14:37,919 --> 00:14:43,840
Network dot com. Financial Survival Network
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