Speaker 1: Back in two thousand and seven, there was one major
Speaker 1: issue on bank balance sheets. Today therefore five major issues
Speaker 1: on bank balance sheets. So you know where people thought
Speaker 1: that the banking system was made so much stronger after
Speaker 1: the two thousand and eight two thousand and nine debacle.
Speaker 1: In fact, when you pull apart the major banking balance sheets,
Speaker 1: they're actually worse. Today you are.
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Speaker 3: You are listening to the Financial Survival Network. I'm your host,
Speaker 3: Carrie Lutz. Well, today we're going to bring you person
Speaker 3: whose predictions are not real positive. He's been right a
Speaker 3: lot of times more often than he's been wrong. Ave
Speaker 3: Gilbert is with us AVI. It's great to have you
Speaker 3: back on. So tell us what lies in store for
Speaker 3: the markets.
Speaker 1: Well, we're looking for possibly one more push higher over
Speaker 1: the coming month or so, assuming that you know we're
Speaker 1: not going to break down below fifty three hundred. I'm
Speaker 1: looking for one more rally up towards fifty eight, fifty eight,
Speaker 1: seventy five or so, and I think once that next
Speaker 1: rally complete, I think we could be putting a little
Speaker 1: exclamation point on a very very long term bull market
Speaker 1: run that from my perspective, started all the way back
Speaker 1: in nineteen thirty two.
Speaker 3: Nineteen thirty two, that's a lot of years. You know,
Speaker 3: we're talking like ninety one years here. That's amazing.
Speaker 1: Yeah, Yeah, it's a very we're looking at it from
Speaker 1: a very very long term perspective. From an Elliot wave standpoint,
Speaker 1: the nineteen twenty nine crash, which bottomed out in nineteen
Speaker 1: thirty two, took off about eighty percent of the market
Speaker 1: relatively quickly. On two three years is relatively quickly, and
Speaker 1: we view that as a second wave in the five
Speaker 1: wave structure. So from nineteen thirty two until where we
Speaker 1: are right now, we're completing a very very long term
Speaker 1: third wave. In fact, nineteen forty one, Ralph Nelson Elliott
Speaker 1: himself predicted this run. He was looking for a seventy
Speaker 1: or eighty year bull market back in nineteen forty one,
Speaker 1: and that's that third wave that I'm talking about and
Speaker 1: as we complete this structure up here, I think it
Speaker 1: will will be we have enough waves to complete that
Speaker 1: long term bull market structure with which will likely usher
Speaker 1: in a very long term correction.
Speaker 3: All right, And when we're talking pre call, you're talking
Speaker 3: about the banks and potential banking crisis on the horizon.
Speaker 1: Yeah. You know, one of the things that we're doing
Speaker 1: for our clients is you know, of course, you know,
Speaker 1: they ask us, well, how do we prepare for such
Speaker 1: an environment? And it's one that we really have in
Speaker 1: face because there's going to be multiple issues that we're
Speaker 1: going to be facing. As an example, the banking industry itself,
Speaker 1: back in two thousand and seven, there was one major
Speaker 1: issue on bank balance sheets. Today therefore five major issues
Speaker 1: on bank balance sheets. So you know, where people thought
Speaker 1: that the banking system was made so much stronger after
Speaker 1: the two thousand and eight two thousand and nine debacle,
Speaker 1: In fact, when you pull apart the major banking balance sheets,
Speaker 1: they're actually worse to and there are more things that
Speaker 1: could take them down today and then back in two
Speaker 1: thousand and seven, you know. So one of the things
Speaker 1: we're looking for is we actually started a service not
Speaker 1: too long ago Safer Banking Research dot Com, and we
Speaker 1: have been looking for some of the safest banks in
Speaker 1: this country, the safest banks in the Eurozone, the safest
Speaker 1: banks in Canada. So that's really been a very big
Speaker 1: focus of ours because what we learned back during the
Speaker 1: twenty ten debacle in Europe when Cyprus, when their banks
Speaker 1: went under, they did something called a bill in. Yes, right,
Speaker 1: So I don't think we're going to have the stomach
Speaker 1: to bail out anymore in the US, and I think
Speaker 1: we're probably going to be moving towards that Cypress model
Speaker 1: of the bail in going forward. And if people are
Speaker 1: not necessarily preparing for that scenario, they could find themselves
Speaker 1: owning bankstock instead of owning actual cash.
Speaker 3: Uh So you think the banks would actually exchange or
Speaker 3: give out shares or IOUs. Maybe they'll own bank IOUs,
Speaker 3: maybe they'll be sellable.
Speaker 1: Right. Well, what they'll wind up doing my my expectation,
Speaker 1: like I said, in light of what we learned with Cyprus,
Speaker 1: is they'll they'll convert a certain percentage of the of
Speaker 1: the bank accounts of their of their client base to
Speaker 1: restructure the bank and make it much more solid. So
Speaker 1: whereas you know you had a certain amount of cash
Speaker 1: in your bank. You know, some of that cash, maybe
Speaker 1: a significant amount. I don't know exactly how much really
Speaker 1: is going to depend on the bank. Some of that
Speaker 1: cash is going to be taken from you and weaken
Speaker 1: convert it into stock and shares of the bank. Now
Speaker 1: people would say, well, how could they do this, Well,
Speaker 1: you know, I don't believe legally they could do it yet,
Speaker 1: but I am quite sure that the legality will be
Speaker 1: settled later on at the end of the day. If
Speaker 1: you're a creditor, you know, by the way, most people
Speaker 1: don't realize that when you put money in a bank,
Speaker 1: you're a creditor. You're a creditor, and you're an unsecured creditor.
Speaker 1: So if a bank goes under, then you're an unsecured
Speaker 1: creditor for the amount that you have in that bank.
Speaker 1: That people say, well, the FDIC will stand behind it, Well,
Speaker 1: the FDIC can only stand behind a certain amount. And
Speaker 1: even back in the two thousand and eight two thousand
Speaker 1: and nine debacle, I think the FDIC went their dip fund,
Speaker 1: depositive insurance fund went negative. I think the number was
Speaker 1: maybe thirty one or thirty one billion. I mean it
Speaker 1: was a massiveness, and that went for a very very
Speaker 1: short period of a banking crisis that was only a
Speaker 1: year or so long banking crisis. What happens if we
Speaker 1: go into a very very long term malaise and banks
Speaker 1: have multiple issues. I don't believe the FDIC will have
Speaker 1: the capacity to stand behind in the industry to that extent.
Speaker 1: And I think people may be left out on the
Speaker 1: cold if they're not preparing sooner around later, I could
Speaker 1: get that bad. Huh. You know, I, as I say,
Speaker 1: I am an analyst, I'm not a profit but I
Speaker 1: can easily see this happening once we go into a
Speaker 1: very long term bear market easily that long huh wow?
Speaker 3: What was what was the last time we had a
Speaker 3: bear market as long as the one you're forecasting?
Speaker 1: Well, From an Elliott wave perspective, as I said, we are,
Speaker 1: we are finishing off a very long term third wave,
Speaker 1: and within that third wave, it also breaks down is
Speaker 1: five waves. The fourth wave of this long term five waves,
Speaker 1: the fourth wave was actually the two thousand to two
Speaker 1: thousand and nine market correction. It was basically sideways for
Speaker 1: nine years, and that was a fourth wave of one
Speaker 1: lesser degree than I'm expecting to come up. So my
Speaker 1: expectation is it should take longer than that long term
Speaker 1: market correction. That one took nine years. My expectation is
Speaker 1: it's probably going to take thirteen to twenty one years
Speaker 1: somewhere in there.
Speaker 3: Well, good thing is I'll probably be gone for that.
Speaker 3: So when it gets really bad, and it gets really
Speaker 3: really bad, but seriously.
Speaker 1: People have the opportunity to at least prepare and protect
Speaker 1: themselves now. And you know, it's better to be prepared
Speaker 1: and hope for the best and pray for the best
Speaker 1: then not be prepared and the worst actually happens.
Speaker 3: Yeah, that's true too. I don't disagree with you there.
Speaker 3: So how do you prepare cash?
Speaker 1: Cash? Is king? Well, the answer is you have to
Speaker 1: know if you have cash, you have to make sure
Speaker 1: it's it's in a solid bank. That's the first thing.
Speaker 1: The second thing is, you know, whereas the nineteenth nine
Speaker 1: to thirty two market crash was basically straight down. There's
Speaker 1: an Elliott wave principle called the theory of alternation, and
Speaker 1: it says that the second wave occurs in a certain way,
Speaker 1: that the fourth wave is going to occur in the
Speaker 1: exact opposite way. So my expectation for this long term
Speaker 1: bear market is that it's going to be a lot
Speaker 1: of you know, little craft is followed by multi year rallies,
Speaker 1: followed by another crash and a multi year rally follow
Speaker 1: So you know, during the when you expect the crashes
Speaker 1: to set up, clearly you go to cash, maybe treasuries.
Speaker 1: It really depends because the treasury market is also setting
Speaker 1: up for a crash as we look out towards the
Speaker 1: second half of this decade, and the same thing is
Speaker 1: going to happen in the treasury market. But overall, they're
Speaker 1: going to be multi year periods of time where you
Speaker 1: can invest in the market during the long term corrective rallies.
Speaker 1: For example, two thousand and three to two thousand and
Speaker 1: seven was a long term corrective rally. So they're going
Speaker 1: seeing multiple opportunities for that to be able to take
Speaker 1: your money back into the market and be able to
Speaker 1: at least make some money during those multi year rally
Speaker 1: But you're also going to have to be much more
Speaker 1: cautious because of those because of the multiple crashes that
Speaker 1: we'll probably have during that long term bear.
Speaker 3: Market, multiple crashes, multiple waves, right, yeah, absolutely, all right,
Speaker 3: So cash in the right bank the gold silver Is
Speaker 3: that going to do you any good?
Speaker 1: Well, Gold and silver we're looking to rally over the
Speaker 1: next year, maybe two really depends how fat the next
Speaker 1: rally takes shape. But you know, we're looking for sizable
Speaker 1: rallies typically in silver and in the mining stocks. Gold
Speaker 1: we're looking for a sizeable rally as well, but it
Speaker 1: has completed a lot of its long term rally off
Speaker 1: the two thousand and fifteen end of twenty fifteen low
Speaker 1: So silver and the mining stocks will probably to a
Speaker 1: big catch up phase over the next year or so.
Speaker 1: But once they complete their long term structures over the
Speaker 1: next year or so, also they're going to be going
Speaker 1: into a multi year deer market as well.
Speaker 3: Mm So everyone's getting hit. But in times where there's
Speaker 3: credit collapse, I've heard it often said that well, the
Speaker 3: pH nominal price of gold might go down, its purchasing
Speaker 3: power can go up.
Speaker 1: I mean, it's possible, now, there's no question about it.
Speaker 1: It's possible. But I mean I think what very few
Speaker 1: people think about this, and I believe that cash will
Speaker 1: probably be a lot more important than people really believe.
Speaker 1: Everybody is still looking for the US dollar collapse. I'm
Speaker 1: looking for a sizeable decline in the the US Dollar
Speaker 1: index the Dixie. As we look out towards the second
Speaker 1: half of this year, I'm looking for a sizeable decline
Speaker 1: to take hold. You know, that'll last now maybe nine
Speaker 1: months a year. I'm not sure exactly how long it'll last,
Speaker 1: but that's going to set up in multi year rally
Speaker 1: in the in the Dixie. In the US dollar, I
Speaker 1: think we could see a rally that laugh, maybe even
Speaker 1: as long as ten years in the dollar after this
Speaker 1: mixed decline that begins over the next few months. So
Speaker 1: you know, whereas people believe the dollar is going to
Speaker 1: just collapse, I'm not of that same opinion.
Speaker 3: Okay, so the dollar is not going to collapse, but
Speaker 3: a lot of other currencies are going to, aren't they.
Speaker 1: Yeah, potentially, I'm not an expert in all the other currencies,
Speaker 1: but yeah, there is strong potential for that.
Speaker 3: Yeah, you can see it. And yeah, with what's going on,
Speaker 3: you know, the bricks and all that, people are worried.
Speaker 3: You think that it's going to displace the dollar. But
Speaker 3: you know, some of these currencies that comprise the bricks
Speaker 3: are really really perilous, like.
Speaker 1: The you on and you know, forget it, And I
Speaker 1: also have an issue with with the aurozone as well.
Speaker 1: I don't they're going to come out of this very well, no,
Speaker 1: no doubt.
Speaker 3: So we're heading for a Dark Ages here.
Speaker 1: You know, the Dark Ages lasted as well, they call
Speaker 1: them the Middle Ages, whatever they want to call them.
Speaker 1: They've lasted hundreds of years. That's not what I'm looking for.
Speaker 3: So what about AI and its potential participation in this mix?
Speaker 1: Here?
Speaker 3: You see anything with AI perhaps lessening this phase or
Speaker 3: maybe even reversing it.
Speaker 1: Well, there are many There are many theories about what
Speaker 1: AI is going to do. Is going to kill employment?
Speaker 1: I mean there are many theories where it's going to do.
Speaker 1: The way I look at AIS, I look at it
Speaker 1: similar to what happened in two thousand. In two thousand,
Speaker 1: the Internet was going to revolutionize everything. Meanwhile, we then
Speaker 1: started into a nine year market when the Internet was
Speaker 1: supposed to revolutionize everything. So I look at AI in
Speaker 1: the same way. Everybody believes AI is going to revolutionize
Speaker 1: everything and it's going to push the markets to crazy heights.
Speaker 1: I look at it the same way as two thousand.
Speaker 1: It's it's a reason everybody's looking for hire when the
Speaker 1: exact opposite potentially can happen.
Speaker 3: Okay, So it's true. But eventually the Internet did revolutionize everything,
Speaker 3: right sure.
Speaker 1: But it doesn't mean that it's going to have an
Speaker 1: equal effect on the stock market in the way everybody expected.
Speaker 1: In two thousand, like I said, we went into a
Speaker 1: bear market when everybody thought we were heading for the
Speaker 1: sky because of the Internet. And I'm seeing the same
Speaker 1: thing with AI. Everybody believes AI is going to send
Speaker 1: us to the sky, and I'm looking at us on
Speaker 1: the verge of potentially starting a major bear market.
Speaker 3: All right, well, anything else should we be buying?
Speaker 1: Food?
Speaker 3: Guns, gold, god?
Speaker 1: Everybody can. Everybody can prepare as they see fit. I
Speaker 1: would just I would just be very very careful about
Speaker 1: you know, what assets you own, where you hold them,
Speaker 1: and you know, also remember, you know, it's best to
Speaker 1: have assets debt free, if you own your home debt free.
Speaker 1: There really isn't a lot more you need to substist though,
Speaker 1: at the end of the day, being debt free, making
Speaker 1: sure your cash is in a safe place, you know,
Speaker 1: you should be okay through. And also have a job
Speaker 1: that's you know, I have a skill that is that
Speaker 1: is easily needed and marketable. I think that's really the
Speaker 1: best people can do to prepare.
Speaker 3: Okay, all right, well thanks for this burst of optimism
Speaker 3: and enthusiasm. We appreciate it. But hey, you got to
Speaker 3: you got to tell it like it is. You got
Speaker 3: to call it the way you see it, right, No.
Speaker 1: No question about it. I know, like I say, I
Speaker 1: pray that I'm wrong every single day, every miendle day.
Speaker 1: I wake up and I look at my charts, and
Speaker 1: I pray that I'm wrong. But yeah, I had yet
Speaker 1: to see something that's going to tell me that I'm wrong.
Speaker 3: All right, Well we're praying right there with you.
Speaker 1: Ave.
Speaker 3: Ave tell us where we find you, how we connect
Speaker 3: with you on the internet.
Speaker 1: Well, we've got elliottwadcreator dot net. We have a twenty
Speaker 1: three analysts that cover the world. As they say, we
Speaker 1: provide all different types of analysis for markets and indices
Speaker 1: and commodities, crypto all over the world. And we also
Speaker 1: have a site called Safer Bankingresearch dot com where we
Speaker 1: do a lot of the analysis about the banking industry.
Speaker 3: All right, Hey, we appreciated AVI. Appreciate you spending your
Speaker 3: time with us. And if you've got a question for
Speaker 3: AVI or myself, shoot me an email kl at Carrie
Speaker 3: LUTs dot com and uh hey. You can find a
Speaker 3: link to avis site in the show notes of this
Speaker 3: interview on Financial Survival Network dot com. We ask you
Speaker 3: to please sign up for your free newsletter where you
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Speaker 3: which basically nobody out there is talking about AVI. We
Speaker 3: will talk to you again soon. Thanks for stopping by.
Speaker 1: Thank you so much for having me again.
Speaker 2: Thanks for listening to carry Letz's Financial Survival Network, your
Speaker 2: solution to today's trying times. For the latest, go to
Speaker 2: Financial Survivalnetwork dot com. Financial Survival Network now more than ever,