1
00:00:00,200 --> 00:00:02,759
Speaker 1: So right now, the market I think is still of

2
00:00:02,759 --> 00:00:05,639
the mind that we don't have to worry about a recession.

3
00:00:05,919 --> 00:00:07,719
I mean, the risks are up a little bit, but

4
00:00:08,039 --> 00:00:10,560
you know, things are all going to work out, deals

5
00:00:10,599 --> 00:00:13,800
are going to be made, and everything's going to be

6
00:00:13,839 --> 00:00:16,440
co pro setic. I'm just not in that camp. I

7
00:00:16,519 --> 00:00:18,879
just think it's time to be a little bit more

8
00:00:18,920 --> 00:00:22,000
skeptical of let's buy every dip and it's going to

9
00:00:22,000 --> 00:00:23,559
be you know, Nirvana.

10
00:00:23,679 --> 00:00:27,480
Speaker 2: You are listening to Carrie Let's's Financial Survival Network where

11
00:00:27,519 --> 00:00:30,920
you get valuable information you just can't find anywhere else

12
00:00:31,480 --> 00:00:35,079
to thrive in today's trying times. You need the Financial

13
00:00:35,159 --> 00:00:40,240
Survival Network now more than ever. Go to Financial Survivalnetwork

14
00:00:40,280 --> 00:00:44,000
dot com and get your free newsletter and gift. Financial

15
00:00:44,159 --> 00:00:47,840
Survival Network now more than ever.

16
00:00:51,039 --> 00:00:54,679
Speaker 3: And welcome you are listening to and watching the Financial

17
00:00:54,719 --> 00:00:55,600
Survival Network.

18
00:00:55,600 --> 00:00:56,840
Speaker 1: I'm your os Kerrie Letz.

19
00:00:57,479 --> 00:01:01,200
Speaker 3: Well, if you're surprised about what happened, what's happened to

20
00:01:01,240 --> 00:01:03,560
the market over the past couple of months, you shouldn't be,

21
00:01:03,560 --> 00:01:06,319
because you'd been watching this show. You would have heard

22
00:01:06,400 --> 00:01:11,680
Jim Welsh sounding the clarion call that trouble was ahead.

23
00:01:11,719 --> 00:01:14,560
For the market, and you would have at least been prepared.

24
00:01:14,760 --> 00:01:19,239
Probably wouldn't have done anything like I didn't, but nonetheless

25
00:01:19,239 --> 00:01:22,000
at least you would have known. So Jim like, what

26
00:01:22,120 --> 00:01:26,239
was the real tip off here back earlier in the

27
00:01:26,319 --> 00:01:30,040
year that made you realize that the markets were headed lower?

28
00:01:30,719 --> 00:01:33,640
Speaker 1: Well, there was a combination of things. First was the perception.

29
00:01:34,599 --> 00:01:36,920
And it's always great to join you, Carrie, and you're

30
00:01:36,920 --> 00:01:39,760
going to be posting a piece on your website that

31
00:01:39,879 --> 00:01:41,959
kind of covers some of the stuff that we're going

32
00:01:42,040 --> 00:01:44,280
to talk about in greater details. I just wanted to

33
00:01:44,599 --> 00:01:46,799
put that out there at the beginning. But at the

34
00:01:46,799 --> 00:01:49,239
beginning of the years, you remember, everyone was pretty bold

35
00:01:49,319 --> 00:01:51,920
up that President Trump was going to come in and

36
00:01:52,040 --> 00:01:56,280
make a good economy even better, and most people thought

37
00:01:56,319 --> 00:02:01,000
that in regards to tariffs, he was using the tariffs

38
00:02:01,079 --> 00:02:04,719
as a negotiation ploy and that he would quickly roll

39
00:02:04,799 --> 00:02:08,960
back as soon as he got some concessions. And Treasury

40
00:02:09,000 --> 00:02:13,400
Secretary Bessen gave a speech in early February, and after

41
00:02:13,439 --> 00:02:17,479
reading his comments, Carrie I came to the conclusion they

42
00:02:17,520 --> 00:02:20,719
weren't going to be backing down. They were serious about

43
00:02:20,800 --> 00:02:24,280
what they were going to do with the tariffs, the

44
00:02:24,360 --> 00:02:30,280
trade negotiations, and that meant that the market wasn't prepared

45
00:02:30,840 --> 00:02:34,280
for that event. And then technically what I had been

46
00:02:34,319 --> 00:02:38,280
writing in January and February was as the SMP was

47
00:02:38,319 --> 00:02:42,759
making new hides, the advanced Decline line was making a

48
00:02:42,840 --> 00:02:46,120
lower peak. In fact, that peaked in November twenty ninth,

49
00:02:46,599 --> 00:02:49,479
and historically Carrie actually going all the way back to

50
00:02:49,560 --> 00:02:53,199
nineteen twenty eight. Divergence is between new highs and a

51
00:02:53,280 --> 00:02:57,000
major average like the SMP or the Dow, whereas the

52
00:02:57,680 --> 00:03:01,280
AD line making a lower high, that pretty much warned

53
00:03:01,840 --> 00:03:05,439
of corrections. Now, if the reason to sell is minor,

54
00:03:05,759 --> 00:03:08,599
then the correction is usually five to ten percent, but

55
00:03:08,759 --> 00:03:12,840
the reason is somewhat more significant, and terrors fell into

56
00:03:12,879 --> 00:03:16,400
that category. Declines of ten to twenty percent or even

57
00:03:16,439 --> 00:03:19,840
bear markets showed up if indeed the economy ultimately went

58
00:03:19,879 --> 00:03:23,120
into a recession. So though all those are all the reasons,

59
00:03:23,599 --> 00:03:28,120
plus sentiment was really high and bullish in terms of

60
00:03:28,240 --> 00:03:32,280
allocation to equities, and you know, when you add all

61
00:03:32,319 --> 00:03:35,879
that off, it was the perfect cocktail, if you will,

62
00:03:35,919 --> 00:03:39,159
for the market to be disappointed and then be vulnerable

63
00:03:39,240 --> 00:03:43,000
to selling pressure, which is what we obviously saw especially

64
00:03:43,039 --> 00:03:44,039
during the month of April.

65
00:03:44,759 --> 00:03:47,360
Speaker 3: All right, so we had the selling pressure, we had

66
00:03:47,400 --> 00:03:51,280
a pullback, wasn't it was dramatic, but it really wasn't

67
00:03:51,319 --> 00:03:54,360
that severe in terms of pullbacks, was it.

68
00:03:55,120 --> 00:03:59,120
Speaker 1: Well, twenty percent is pretty meaningful, and in terms of

69
00:03:59,159 --> 00:04:03,199
the time impression, you know, that makes it even more meaningful.

70
00:04:03,319 --> 00:04:06,879
At the same time the SMP then you know, off

71
00:04:06,919 --> 00:04:10,080
that wall, I was expecting a rally and a couple

72
00:04:10,080 --> 00:04:12,960
of weeks ago targeted fifty seven hundred to fifty seven

73
00:04:13,120 --> 00:04:17,759
fifty for this rally, So you know the impact carry

74
00:04:17,839 --> 00:04:21,240
when you have a sharp decline that is then reversed

75
00:04:21,680 --> 00:04:27,199
relatively quickly. You know, the damage psychologically is obviously lessened.

76
00:04:27,720 --> 00:04:30,000
But i've you and I have talked about this. The

77
00:04:30,040 --> 00:04:33,639
bifurcation in the US economy is pretty extreme in the

78
00:04:33,720 --> 00:04:36,959
sense the bottom fifty percent of people have been under

79
00:04:37,000 --> 00:04:41,199
the gun from higher prices, higher cost of living, wages

80
00:04:41,279 --> 00:04:45,040
not keeping up. And that's the part why President Trump

81
00:04:45,639 --> 00:04:48,160
was elected. A lot of people who had never voted

82
00:04:48,199 --> 00:04:51,480
for a Republican decided to do so because they remembered

83
00:04:51,560 --> 00:04:55,079
back in twenty eighteen the economy was in better shape.

84
00:04:55,319 --> 00:04:59,040
They were in better shape. The top ten percent now

85
00:04:59,079 --> 00:05:04,920
account for fifty percent of consumer spending, so that has

86
00:05:04,959 --> 00:05:08,879
been buttressed by the stock market doing well. Housing prices

87
00:05:08,959 --> 00:05:11,680
gained fifty percent over the last four or five years.

88
00:05:12,199 --> 00:05:16,160
So when we see acid prices start to falter, I

89
00:05:16,199 --> 00:05:20,240
think that again is a warning that those at the

90
00:05:20,279 --> 00:05:24,040
top who have been really carrying the spending load will

91
00:05:24,439 --> 00:05:27,079
at some point in time start to become more cautious

92
00:05:27,120 --> 00:05:30,839
and pull back. So, you know, I believe that we're

93
00:05:30,879 --> 00:05:33,800
in a bear market and that the odds are we're

94
00:05:33,800 --> 00:05:36,360
going to see the S and P go back down

95
00:05:36,439 --> 00:05:38,879
to the loads that we saw on April seventh at

96
00:05:38,920 --> 00:05:43,199
forty eight thirty five. And you know, I just think

97
00:05:43,240 --> 00:05:48,439
that the repercussion from the terrafor the FED not doing anything,

98
00:05:48,720 --> 00:05:51,839
the economy's going to slow. We're going to see unemployments

99
00:05:51,879 --> 00:05:54,399
start to pick up. And you know, when you add

100
00:05:54,439 --> 00:05:57,439
all that up together, it's the stock market priced for

101
00:05:57,519 --> 00:06:02,199
all that. I don't think so.

102
00:06:01,040 --> 00:06:04,879
Speaker 3: So you don't think the tariff war is ending quickly,

103
00:06:05,959 --> 00:06:06,759
I don't think so.

104
00:06:06,920 --> 00:06:09,839
Speaker 1: Again, Normally it takes eighteen months to come up with

105
00:06:09,920 --> 00:06:14,480
a trade negotiated deal because they're an enormous amount of detail.

106
00:06:15,000 --> 00:06:17,240
So what that suggests is what's going to happen in

107
00:06:17,279 --> 00:06:22,959
the next few weeks is the administration will announce agreements

108
00:06:23,000 --> 00:06:25,680
and principle well which we've agreed to a trade deal,

109
00:06:26,199 --> 00:06:28,040
but now we're going to work out the details. And

110
00:06:28,079 --> 00:06:31,279
as we all know, in any legal document which a

111
00:06:31,399 --> 00:06:35,519
trade deal certainly qualifies, the devil is always in the details.

112
00:06:36,079 --> 00:06:38,240
So I just think that, you know what that means

113
00:06:38,319 --> 00:06:42,000
is down the road, there's hiccups that are going to happen.

114
00:06:42,639 --> 00:06:47,399
So I just don't think that unless the tariffs. Right

115
00:06:47,439 --> 00:06:49,959
now we're at a ten percent flat with obviously very

116
00:06:50,040 --> 00:06:53,519
high tariffs against China, right ten percent tariff is up

117
00:06:53,519 --> 00:06:57,319
from two percent. So if we even with the trade deals,

118
00:06:57,319 --> 00:07:00,439
if we stay at ten percent, that is a significant

119
00:07:00,759 --> 00:07:03,199
increase and the net result then I've written about this

120
00:07:03,240 --> 00:07:06,680
a lot over the last year. You know, in nineteen

121
00:07:06,920 --> 00:07:12,959
thirty Smooth Holly was passed and world trade dropped by

122
00:07:13,079 --> 00:07:17,399
sixty five percent because everybody else, you know, started to

123
00:07:17,439 --> 00:07:20,839
do the same thing. And we actually have seen carry

124
00:07:21,160 --> 00:07:24,639
over the last five years more and more trade barriers

125
00:07:24,920 --> 00:07:29,360
regulations being raised, not by just the US but globally.

126
00:07:30,040 --> 00:07:34,240
So the ground is set, unfortunately to almost repeat some

127
00:07:34,319 --> 00:07:37,639
of the experience of the nineteen thirties. Did you know

128
00:07:37,759 --> 00:07:41,399
tariff's calls the Great Depression? Know, but they made the

129
00:07:41,439 --> 00:07:45,079
global economy weaker than it otherwise would have been. And

130
00:07:45,120 --> 00:07:49,120
I think they made that weakness be deeper and last longer.

131
00:07:49,480 --> 00:07:52,680
So I'm not a big fan of terras. The longer

132
00:07:52,720 --> 00:07:56,720
they persist, I think that is problematic for the economy. Yeah.

133
00:07:56,759 --> 00:08:04,680
Speaker 3: Well, you know, I'm a free trader myself, but when China,

134
00:08:05,000 --> 00:08:09,959
you know, basically weaponizes free trade, yep, then you got

135
00:08:10,000 --> 00:08:13,240
to do something that maybe isn't for the short term

136
00:08:13,319 --> 00:08:17,199
good of the country or the world, but it has

137
00:08:17,279 --> 00:08:20,519
to stop. And you know, I've been reading about this

138
00:08:20,600 --> 00:08:25,240
for decades already. They just ignore the wto, they ignore

139
00:08:25,279 --> 00:08:28,319
all the rules. So it's got to be done. And

140
00:08:29,120 --> 00:08:32,440
it's a big excrement sandwich. But we all got to

141
00:08:32,480 --> 00:08:33,159
think a bite.

142
00:08:33,879 --> 00:08:37,440
Speaker 1: I've ever heard that expression? Yeah, well, I agree with you.

143
00:08:37,879 --> 00:08:40,519
To me, it all comes down to the manner in

144
00:08:40,559 --> 00:08:44,440
which it's being done, you know, basically starting with a

145
00:08:44,480 --> 00:08:47,559
punch to the jaw as opposed to you got thirty

146
00:08:47,679 --> 00:08:50,399
days to come to the table and come up with

147
00:08:50,440 --> 00:08:53,799
an agreement in principle to work out our trade difficence

148
00:08:53,879 --> 00:08:56,440
and if you don't, this is what we're going to do.

149
00:08:57,000 --> 00:09:01,159
So I agree entirely that since joining the World Trade

150
00:09:01,240 --> 00:09:04,360
Organization since two thousand and one, and we urged that

151
00:09:04,600 --> 00:09:08,480
Bill Clinton was very much in favor, both Democrats and

152
00:09:08,559 --> 00:09:13,279
Republicans voted for that to take place. But China has

153
00:09:13,919 --> 00:09:18,600
obviously capitalized on that and to the detriment and not

154
00:09:18,679 --> 00:09:21,519
just US, but other training partners around the world.

155
00:09:21,840 --> 00:09:25,279
Speaker 3: Everyone nobody is happy with him, and especially after COVID,

156
00:09:25,720 --> 00:09:29,840
now that we have pretty good evidence that it came

157
00:09:29,840 --> 00:09:32,399
from a lab league there, even though the United States

158
00:09:32,440 --> 00:09:36,000
self funded, which is a story for another's dillionary.

159
00:09:37,120 --> 00:09:40,679
Speaker 1: But you know, enough is.

160
00:09:40,759 --> 00:09:44,200
Speaker 3: Enough already, Yeah, and you know it had to end,

161
00:09:44,360 --> 00:09:46,559
and yeah, maybe there is a better way to do it.

162
00:09:47,200 --> 00:09:53,519
But the difference is that you know, Trump knows g

163
00:09:54,759 --> 00:09:58,120
and he worked on this before. And we're not even

164
00:09:58,519 --> 00:10:02,759
mentioning the fentanyl, which for China is revenge for the

165
00:10:02,799 --> 00:10:04,159
opium wars, you know.

166
00:10:04,799 --> 00:10:08,639
Speaker 1: Yeah, yeah, well no, again, all this is warranted. It

167
00:10:08,799 --> 00:10:10,840
just comes down to the manner which they're doing it.

168
00:10:11,240 --> 00:10:13,440
At the same time, I think President Trump and his

169
00:10:13,519 --> 00:10:18,320
administration to understand the clock is ticking. The midterm elections

170
00:10:18,360 --> 00:10:21,240
are what eighteen twenty months away or something, you know,

171
00:10:21,320 --> 00:10:24,559
not that far off, So they need to accomplish an

172
00:10:24,600 --> 00:10:28,679
awful lot very very quickly, so that whatever fallout and

173
00:10:28,759 --> 00:10:32,919
damage does happen, there's still a window of time where

174
00:10:32,919 --> 00:10:36,759
the economy can recover and show improvement going into the

175
00:10:37,080 --> 00:10:38,360
midterm elections.

176
00:10:38,559 --> 00:10:41,919
Speaker 3: I totlly agree with you, Well, what about DOGE Now

177
00:10:42,000 --> 00:10:46,759
that initially has a deflationary effect because all this money,

178
00:10:47,399 --> 00:10:52,320
all the grifters aren't getting paid now, right, so they're

179
00:10:52,320 --> 00:10:58,240
in a recession. And then the federal employees, who you know,

180
00:10:58,559 --> 00:11:03,039
basically I always say a federal worker government worker is

181
00:11:03,039 --> 00:11:08,320
a bit of an oxy moron. But you know, there's

182
00:11:08,360 --> 00:11:11,639
a lot of them that are hitting the bricks, and

183
00:11:12,159 --> 00:11:14,399
you know, in the long run that is the best thing,

184
00:11:14,440 --> 00:11:21,000
because they're total parasites and unproductive and destructive, going against

185
00:11:21,840 --> 00:11:23,120
the country's best interest.

186
00:11:23,279 --> 00:11:27,600
Speaker 1: Right, yeah again. A year ago, in April last year,

187
00:11:27,919 --> 00:11:31,679
the General Accountability Office, which was started in nineteen twenty

188
00:11:31,759 --> 00:11:36,559
one nonpartisan entity, came out with report carry and said

189
00:11:36,679 --> 00:11:40,080
somewhere between two hundred and thirty billion, hundred and five

190
00:11:40,159 --> 00:11:43,120
hundred and twenty billion of waste and fraud is happening

191
00:11:43,200 --> 00:11:47,960
every single year. President Biden did not do anything. And

192
00:11:48,120 --> 00:11:52,519
the fact that Elon Musk Indulge are going after a

193
00:11:52,559 --> 00:11:58,039
problem that was identified by a non partisan entity, to me,

194
00:11:58,120 --> 00:12:02,639
should tell anyone who's objective everything we need to know.

195
00:12:03,120 --> 00:12:05,960
There is a lot of waste in fraud. And so

196
00:12:06,320 --> 00:12:09,000
I commend that because when you start saying, okay, oh,

197
00:12:09,159 --> 00:12:11,279
maybe they only found one hundred and fifty billion, I

198
00:12:11,360 --> 00:12:14,840
suspect it's going to war. But you multiplied that about

199
00:12:14,879 --> 00:12:17,879
ten years. Yeah, so far you know, one and a

200
00:12:17,919 --> 00:12:21,960
half trillion dollars. So it's very meaningful, and it does

201
00:12:22,000 --> 00:12:26,879
to send a message to government workers and maybe to

202
00:12:27,039 --> 00:12:31,240
politicians who supported some of this stuff and continue to

203
00:12:31,240 --> 00:12:32,000
support some of.

204
00:12:31,919 --> 00:12:34,200
Speaker 3: The both sides of the aisle.

205
00:12:34,320 --> 00:12:39,559
Speaker 1: Are police trouble here, right, no question, no question. So

206
00:12:40,679 --> 00:12:44,679
I you know, I support what Musk is doing. And

207
00:12:45,080 --> 00:12:48,879
you know, sometimes the louder people squeal at something tells

208
00:12:48,879 --> 00:12:50,360
you something about those people.

209
00:12:50,840 --> 00:12:54,799
Speaker 3: Pigs always squeal, Jim, you know, when they're being led

210
00:12:54,879 --> 00:13:00,320
off the slaughter. And how could any thinking politician, any

211
00:13:01,120 --> 00:13:04,799
any citizen of the country have any issue with what's

212
00:13:04,840 --> 00:13:08,720
being done there. They're finding, you know, billions and billions

213
00:13:09,120 --> 00:13:12,639
and they haven't even hit their strudge yet. I mean

214
00:13:12,840 --> 00:13:15,200
only get that he's only been there one hundred days,

215
00:13:15,600 --> 00:13:19,399
so that maybe will be his greatest contribution this time

216
00:13:19,480 --> 00:13:21,960
around that he put an end to it and said

217
00:13:22,039 --> 00:13:23,200
no mos right.

218
00:13:23,519 --> 00:13:25,879
Speaker 1: Right right, And you know what I mean. Last time

219
00:13:25,879 --> 00:13:29,320
we've spoken before that you know, Besson has said the

220
00:13:29,360 --> 00:13:31,720
goal is to get the deficit from over six percent

221
00:13:31,759 --> 00:13:34,759
of GDP, which it was last year and the year before.

222
00:13:35,440 --> 00:13:39,360
Has never happened in the history of our country where

223
00:13:39,399 --> 00:13:43,320
you had a six percent plus on deficit during a

224
00:13:43,360 --> 00:13:45,360
time when the economy's gone to and a half percent

225
00:13:45,600 --> 00:13:49,639
and peace and peace piece at least. Yeah, not so.

226
00:13:49,759 --> 00:13:52,039
But when you go from three six percent to three,

227
00:13:52,120 --> 00:13:54,879
that's shaving a trillion dollars worth of government spending. So

228
00:13:54,960 --> 00:13:58,440
as you said at the very beginning, was well, when

229
00:13:58,440 --> 00:14:02,879
you cut back on spending, it does have deflationary effects

230
00:14:02,919 --> 00:14:06,600
because the economy is going to grow more slowly when

231
00:14:06,600 --> 00:14:11,360
you eliminate that kind of spending. So you know, again,

232
00:14:11,600 --> 00:14:14,559
I think the economy is going to slow more than

233
00:14:14,600 --> 00:14:17,960
maybe people expect. The other issue regarding everything that's going

234
00:14:18,000 --> 00:14:21,639
on is uncertainty. So there was a survey of CEOs

235
00:14:21,679 --> 00:14:26,399
over the last few months and in January carry sixty percent.

236
00:14:26,480 --> 00:14:33,240
We're expecting to increase investment capital spending, We're expected to

237
00:14:33,279 --> 00:14:37,360
add more hires and bring more people on work. In

238
00:14:37,440 --> 00:14:40,320
March or part of the April survey, those were cut

239
00:14:40,399 --> 00:14:43,120
in half. Like now it's thirty percent. So you have

240
00:14:43,159 --> 00:14:45,840
a lot of people sitting on their hands, which again

241
00:14:45,960 --> 00:14:49,440
isn't great for economic growth. And potentially, you know, if

242
00:14:49,480 --> 00:14:52,879
everything gets resolved quickly, then some of that will come

243
00:14:52,919 --> 00:14:56,159
on board. But those are all the reasons why again

244
00:14:56,240 --> 00:14:57,919
I think the economy is going to slow. And the

245
00:14:57,919 --> 00:15:00,279
one thing I want to touch on real quick. You know,

246
00:15:00,320 --> 00:15:02,720
the employment report came out and everybody, well, look at

247
00:15:02,720 --> 00:15:05,639
that one hundred and seventy seven thousand jobs rush. It

248
00:15:05,679 --> 00:15:08,519
was a decent number, Okay, they actually there was I

249
00:15:08,559 --> 00:15:12,080
think a reduction of seven thousand government workers. So as

250
00:15:12,080 --> 00:15:14,799
opposed the last twenty months or so, were they all go,

251
00:15:15,720 --> 00:15:18,399
I don't know, they're walking the brick somewhere. But my

252
00:15:18,559 --> 00:15:21,159
point is underneath the surface, if you look at the

253
00:15:21,200 --> 00:15:25,960
weekly claims report, the length of time that people are

254
00:15:26,080 --> 00:15:29,600
on employment has continued to increase. So what does that

255
00:15:29,639 --> 00:15:33,240
tell us is that companies aren't laying people off, but

256
00:15:33,279 --> 00:15:38,200
they have in fact, as that CEO service yes all right,

257
00:15:38,639 --> 00:15:44,639
and also continuing claims is up over one point nine million,

258
00:15:45,399 --> 00:15:49,039
So it's just validating. What we're seeing is that slowly

259
00:15:49,080 --> 00:15:52,679
but surely the labor market is weakening, and if the

260
00:15:52,759 --> 00:15:55,960
economy slows, the next shooter drop will be companies laying

261
00:15:55,960 --> 00:16:00,759
off workers. Unfortunately, the unemployment rate is a lagging in

262
00:16:00,799 --> 00:16:04,480
the care and the FED is kind of like stuck. Well,

263
00:16:04,480 --> 00:16:06,519
we're going to probably see higher prices at least for

264
00:16:06,559 --> 00:16:09,600
some period of time from the tariffs, but we're waiting

265
00:16:09,639 --> 00:16:12,720
on the unemployment rate to tick up, which I think

266
00:16:12,720 --> 00:16:17,320
it will, and they said in the March Summary of

267
00:16:17,360 --> 00:16:20,960
Economic Projections that they think the unemployment rate will get

268
00:16:21,000 --> 00:16:22,639
up to four to four by the end of this year.

269
00:16:23,399 --> 00:16:26,159
In April was four to two. So the point I've

270
00:16:26,159 --> 00:16:27,919
been making is, yes, the FED is going to be

271
00:16:27,919 --> 00:16:30,879
paying attention to inflation, they're going to pay more attention

272
00:16:30,960 --> 00:16:33,679
to the unemployment rate, and if it gets above four

273
00:16:33,720 --> 00:16:37,080
to four, then I think the FED will feel much

274
00:16:37,080 --> 00:16:42,240
more comfortable in moving to cut rates because it'll be

275
00:16:42,279 --> 00:16:48,399
clear that it's warranted. And not because President Trump criticized Paul,

276
00:16:48,639 --> 00:16:52,519
but that economic data has shown them that Yep, it's

277
00:16:52,559 --> 00:16:55,559
time to cut. So I think that's what's coming. It's

278
00:16:55,600 --> 00:16:57,559
just a question of how soon is it going to arrive.

279
00:16:58,200 --> 00:17:02,159
Speaker 3: Well, my guess is when you're dealing with Jerome Powell,

280
00:17:03,600 --> 00:17:05,319
he's always late to the party, right.

281
00:17:06,039 --> 00:17:08,599
Speaker 1: Well, that historically has been not just Powell, but almost

282
00:17:08,599 --> 00:17:11,480
every FED president because they do wait for the unemployment

283
00:17:11,559 --> 00:17:14,559
rate to tick higher and again by the time companies

284
00:17:14,559 --> 00:17:17,519
are laying workers off, because that's the other reason, you know,

285
00:17:17,599 --> 00:17:20,839
already too late. It's already too late. I mean, employers

286
00:17:20,880 --> 00:17:23,680
will resist laying people off, the cut hours to do

287
00:17:23,759 --> 00:17:25,960
all kinds of stuff because they don't want to let

288
00:17:26,000 --> 00:17:30,559
an experienced workers leave and go especially So yeah, so

289
00:17:30,599 --> 00:17:32,519
by the time it's like, I don't know the choice,

290
00:17:32,599 --> 00:17:35,079
I got to let some people go. The economy obviously

291
00:17:35,160 --> 00:17:38,960
already is weakening, their sales are dropping. They have to

292
00:17:39,000 --> 00:17:43,039
do it. So, by its nature, monetary policy is conducted

293
00:17:43,079 --> 00:17:45,720
by looking through the rear view mirror of our car.

294
00:17:46,720 --> 00:17:48,960
And by the time the cars over the cliff, the

295
00:17:49,039 --> 00:17:51,119
Feds say, oh my god, we're over the cliff. We

296
00:17:51,240 --> 00:17:53,079
better cut rights. So they're always late.

297
00:17:53,839 --> 00:17:58,720
Speaker 3: They're like Jimmy James Dean in Rebel without a Cause

298
00:17:58,880 --> 00:18:01,079
right where they're having that little game.

299
00:18:00,880 --> 00:18:02,880
Speaker 1: Is to see who's caress.

300
00:18:03,240 --> 00:18:05,680
Speaker 3: Yeah, who can jump out of the car foot first?

301
00:18:06,240 --> 00:18:09,599
Speaker 1: Yeah, well the last guy to go win. Yeah, unforsutly

302
00:18:09,599 --> 00:18:12,039
that guy was the last guy, excepted it.

303
00:18:12,039 --> 00:18:15,319
Speaker 3: Might be oriental, he wins.

304
00:18:16,000 --> 00:18:18,880
Speaker 1: I think as it. Yeah, it's a great scene. It's

305
00:18:18,960 --> 00:18:19,880
really great scene.

306
00:18:19,960 --> 00:18:24,400
Speaker 3: So that's like something the Federal Reserve. Well, we always

307
00:18:24,440 --> 00:18:26,039
date ourselves, you know that.

308
00:18:26,279 --> 00:18:27,720
Speaker 1: People have to look at the screen.

309
00:18:28,599 --> 00:18:32,640
Speaker 3: Experience is always about dating yourself. Yes, it's not our

310
00:18:32,680 --> 00:18:34,559
first rodeo here, Jim, right.

311
00:18:34,640 --> 00:18:36,759
Speaker 1: No, it isn't. And we have the bumps and bruises

312
00:18:36,759 --> 00:18:37,319
to prove it.

313
00:18:38,279 --> 00:18:43,039
Speaker 3: Yeah yeah, and the uh and the higher insurance premiums

314
00:18:43,039 --> 00:18:43,480
as well.

315
00:18:44,039 --> 00:18:46,839
Speaker 1: So I yes, yeah, so all right.

316
00:18:48,119 --> 00:18:51,319
Speaker 3: So but the market, the market's going to take a hit,

317
00:18:51,839 --> 00:18:54,359
but then it's going to it's a leading indicator. It's

318
00:18:54,400 --> 00:18:57,519
going to see that uh, you know, it's going to

319
00:18:57,599 --> 00:18:58,839
look ahead eighteen months.

320
00:18:58,920 --> 00:19:01,720
Speaker 1: Right. Well, here's the thing. People always say the market's

321
00:19:01,759 --> 00:19:05,480
a discounting mechanism, that it's looking ahead, and yes, it

322
00:19:05,480 --> 00:19:08,519
does do that, but the reality is it often at

323
00:19:08,559 --> 00:19:11,640
important junctures gets it wrong. I mean we just saw

324
00:19:11,680 --> 00:19:14,640
one in January. People were looking ahead. Trump is going

325
00:19:14,720 --> 00:19:17,480
to make the economy better. Oh yeah, tariffs are going

326
00:19:17,559 --> 00:19:20,400
to make the dollar go up. And what happened. The

327
00:19:20,480 --> 00:19:23,880
dollar dropped ten percent in a very quick period of time.

328
00:19:24,279 --> 00:19:27,720
The SMB dropped by twenty percent. So for me, carry

329
00:19:27,759 --> 00:19:32,000
the idea that markets somehow have more greater or greater

330
00:19:32,119 --> 00:19:36,799
vision in knowledge than we do, I think it's a joke,

331
00:19:37,599 --> 00:19:42,200
because that's why contrary opinion, my view is a much

332
00:19:42,240 --> 00:19:45,119
more powerful thing. So when everyone was bullisht a dollar

333
00:19:45,160 --> 00:19:49,680
in January, I'm looking at charts and just common sense saying, no,

334
00:19:49,720 --> 00:19:51,960
I think the dollar is ready to drop below one hundred.

335
00:19:52,119 --> 00:19:54,599
It was that one ten. Oh the market, Oh yeah,

336
00:19:54,640 --> 00:19:57,960
everybody's bulled up on the market. I think Trump is

337
00:19:58,000 --> 00:20:01,279
serious about the tariffs. They're not not expecting that that

338
00:20:01,359 --> 00:20:04,240
gives them more reason to sell. So right now, the

339
00:20:04,279 --> 00:20:06,720
market I think is still of the mind that we

340
00:20:06,799 --> 00:20:08,960
don't have to worry about a recession. I mean, the

341
00:20:09,039 --> 00:20:11,279
risks are up a little bit, but you know, things

342
00:20:11,319 --> 00:20:13,680
are all going to work out. Deals are going to

343
00:20:13,720 --> 00:20:17,960
be made, and everything's going to be copro setic. I'm

344
00:20:18,000 --> 00:20:20,079
just not in that camp. I just think it's time

345
00:20:20,440 --> 00:20:23,440
to be a little bit more skeptical of let's buy

346
00:20:23,480 --> 00:20:26,200
every dip and it's going to be you know, Nirvana.

347
00:20:26,720 --> 00:20:30,559
Speaker 3: Yeah, well, you know the miracle is central planning.

348
00:20:30,240 --> 00:20:35,519
Speaker 1: Right, yeah, miracle with a small M.

349
00:20:35,599 --> 00:20:39,720
Speaker 3: Yeah. Yeah, because we've been down this road before, we knew,

350
00:20:40,440 --> 00:20:41,359
we totally knew.

351
00:20:41,880 --> 00:20:44,640
Speaker 1: Yep. Yeah. And so one thing you touch on and

352
00:20:44,680 --> 00:20:48,440
again you're going to be posting as peasy to sent you.

353
00:20:48,880 --> 00:20:51,240
But one of the talking about the last two three

354
00:20:51,279 --> 00:20:56,079
weeks is positioning in the Dollar index has gotten very extreme.

355
00:20:56,119 --> 00:20:58,880
In other words, it's just dropped ten percent and people

356
00:20:58,880 --> 00:21:03,119
are going short the dollar long other currencies, anticipation that

357
00:21:03,240 --> 00:21:06,839
is going to keep going, and the level of bearish

358
00:21:06,960 --> 00:21:11,680
positioning Carrie is more extreme now than it was in

359
00:21:11,720 --> 00:21:16,119
October of twenty twenty three, and any other intermediate bottom

360
00:21:16,599 --> 00:21:22,319
over the last year or so that the dollar has made. Plus,

361
00:21:22,680 --> 00:21:26,440
the chart pattern as I described in that piece suggests

362
00:21:26,559 --> 00:21:30,319
that after the dollar peaked at one fourteen seventy in

363
00:21:30,359 --> 00:21:33,920
October of twenty twenty two, it went through a big

364
00:21:34,039 --> 00:21:37,640
sideways type of correction down to one ten or one

365
00:21:37,720 --> 00:21:42,039
hundred part meeting ninety nine up to one oh seven

366
00:21:42,119 --> 00:21:44,599
down to ninety nine up to one ten. I think

367
00:21:44,640 --> 00:21:48,880
it's completed this correction from that high in October of

368
00:21:48,920 --> 00:21:52,359
twenty twenty two. There may be one more dip below

369
00:21:52,440 --> 00:21:55,880
the low recently of ninety seven to ninety two, but

370
00:21:56,039 --> 00:21:58,480
beyond that, I think the dollar is going to surprise

371
00:21:58,559 --> 00:22:00,559
people carry in rap more.

372
00:22:01,200 --> 00:22:05,039
Speaker 3: I agree with you one hundred percent. Uh, you know,

373
00:22:05,279 --> 00:22:08,519
I'm just expecting it because it's right now hitting resistance.

374
00:22:08,559 --> 00:22:12,039
That one hundred is yeah, massive resistance.

375
00:22:12,359 --> 00:22:15,000
Speaker 1: Yeah, it was support so it makes sense that it's

376
00:22:15,039 --> 00:22:19,359
overhead resistance. And so again the chart pens suggests it

377
00:22:19,400 --> 00:22:25,119
could have one more drop because the RSI got extraordinarily

378
00:22:25,160 --> 00:22:28,000
over sold when it dropped to that ninety seven ninety

379
00:22:28,000 --> 00:22:31,119
two was down to like twenty one, So it wouldn't

380
00:22:31,200 --> 00:22:33,160
you know, that's another reason why you get a bounce

381
00:22:33,400 --> 00:22:36,279
to relieve how oversold it is, then go down, take

382
00:22:36,319 --> 00:22:40,039
a make a lower low, and then register a higher

383
00:22:40,200 --> 00:22:43,680
r side level, which then provides you know, a momentum

384
00:22:43,759 --> 00:22:47,000
non confirmation, which in this case is supportive of the bottom.

385
00:22:47,119 --> 00:22:49,599
Speaker 3: Yeah, short short covering rally.

386
00:22:50,319 --> 00:22:52,119
Speaker 1: And that's how it all readys starts. You know, when

387
00:22:52,160 --> 00:22:54,160
you have a lot of people betting against something and

388
00:22:54,160 --> 00:22:57,799
they're short. The initial rally is maybe it's not going

389
00:22:57,839 --> 00:23:00,720
to go down as much as we thought one hund percent?

390
00:23:00,799 --> 00:23:03,039
Speaker 3: Right always, ohways the case?

391
00:23:03,200 --> 00:23:04,880
Speaker 1: All right? Yeah? Yeah. Link.

392
00:23:05,279 --> 00:23:08,000
Speaker 3: The link is in the show notes this interview on

393
00:23:08,079 --> 00:23:11,319
Financial Survival Network and in the show notes on the

394
00:23:11,359 --> 00:23:16,519
podcast everything else on YouTube. It'll be hooked into my dropbox.

395
00:23:17,200 --> 00:23:21,720
Just tell tell everyone out there, Jim, how you how

396
00:23:21,759 --> 00:23:24,039
you subscribe and what the deal is?

397
00:23:24,119 --> 00:23:26,599
Speaker 1: Okay, okay? One of that's comment. If I'm right about

398
00:23:26,599 --> 00:23:28,559
the dollar of you two or write about the dollar,

399
00:23:28,599 --> 00:23:31,839
I don't think that's a positive for gold. So I

400
00:23:31,839 --> 00:23:34,880
think gold has a pullback at least to thirty one hundred.

401
00:23:35,160 --> 00:23:38,480
I think it possibly could get down towards twenty six hundred.

402
00:23:38,559 --> 00:23:42,240
So that's you know again, remember in September October of

403
00:23:42,279 --> 00:23:44,920
twenty two, gold bottom that sixteen hundred as the dollar

404
00:23:45,039 --> 00:23:48,319
was topping. So remember it's yan yang I think is important.

405
00:23:48,319 --> 00:23:51,680
All right, macrotides dot com. If you would like a

406
00:23:51,720 --> 00:23:56,640
recent publication, Jim Welsh macro at gmail, I'm happy to

407
00:23:56,680 --> 00:24:01,359
send out like the May issue of macro Tides or

408
00:24:01,400 --> 00:24:04,400
one of my recent which I publish every Monday, weekly

409
00:24:04,480 --> 00:24:05,720
technical reviews.

410
00:24:06,000 --> 00:24:09,759
Speaker 3: Yeah, all right, excellent. Hey you got a question for

411
00:24:09,839 --> 00:24:12,720
Jim or myself, shoot me an email kl at Carrie

412
00:24:12,759 --> 00:24:16,200
LUTs dot com. We answer everything. Jim, appreciate you coming on,

413
00:24:16,440 --> 00:24:18,839
been a while, and we'll talk to you again real soon.

414
00:24:18,960 --> 00:24:21,079
Speaker 1: You got it, Thanks, Carrie, stay well.

415
00:24:20,720 --> 00:24:24,880
Speaker 2: Thanks for listening to Carrie Letz's Financial Survival Network, your

416
00:24:24,960 --> 00:24:28,759
solution to today's trying times. For the latest, go to

417
00:24:28,920 --> 00:24:35,200
Financial Survivalnetwork dot com. Financial Survival Network now more than ever,