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May 22, 2024 - Lionel Nation
27:17
Market Shockwave: The Final Blowoff Has Arrived – Are You Prepared?
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Joining me again, my friend, is the inimitable, the ineffable, the ineluctable Bob Kudlow from...
Trade with Lionel.com.
Bob, good to see you.
Let's get into it.
Every time I speak with you, you blow my mind, and today is no different.
So proceed, sir.
Blow what's left of my mind.
What should we be looking for?
What's happening?
Yeah, so we're coming into, I think, probably the final blow-off in the stock market before we go into a beer market and a...
An economic retrenchment.
So things are setting up here.
The way the market operates is it requires the government to keep increasing money supply and then also needs to provide liquidity that can be leveraged.
And so we have a situation setting up right now where there's a lot of liquidity that's going to be available for speculation in the stock market for the short term.
And that's coming from companies that have a lot of cash yet, so they're buying back shares.
You've got the federal government that has liquidity from the tax revenues, and you have the Federal Reserve that has liquidity.
And then also, just mom and pop, because of the interest rates are at 4% and 5% short-term money, is that they have a lot of liquidity.
And then the banks have liquidity because they're buying the Treasury short-term bonds.
And they can leverage that up 8x.
And so all that's going to come into the markets for a final blow-off.
And why we think it's coming for sure is that Bitcoin is the canary in the coal mine.
And Bitcoin now has, you know, obviously hit a high of 74,000 a couple weeks ago.
It pulled all the way back down to 56,000.
As of this morning, it's back up over $70,000.
I think it hit over $71,000 overnight.
And once it breaks that high again, it's not going to look back.
You're looking at $80,000, $86,000, then over $100,000.
And then, depending on how radical your view is on the move, there's some speculation that Bitcoin can go up to even $170,000 on this move.
And why that's important...
Is that Bitcoin is more what I would call a pure barometer of liquidity and speculation because there's less ways in which they can manipulate it because you have to settle in Bitcoin.
So they just can't create fake silver and fake gold.
You can't create fake Bitcoin because it's on the ledger.
Okay, so it just operates more purely up and down, okay?
And so, yep, I'm sorry.
The dog's barking here in a second.
That is quite all right.
Don't worry about it.
I share the dog's feeling.
We're excited.
They're right outside my office.
My wife just walked out the door, so I apologize for this.
Please, let's don't ruin this.
Don't ruin this excitement.
It takes more than a dog.
Yeah, so we have...
The situation is now where the rest of the market is going to follow that liquidity.
But we're looking at a 15% to 20% move higher in the next 60 days.
So we're telling our clients to strap in, take advantage of this, and then by the time summer ends, anywhere between up to August 15th to Labor Day, Right.
the election let's set aside all the moral aspects of it and achieving and all that crap none of that matters to the market all the way all that matters to the market is who they believe is going to win, whether they win legitimately or not, it's irrelevant.
Right.
The Democrats that are saying, hey, we've got to pump this market so people will buy our stuff.
And then we have Republicans saying if the Democrats win this election, you know, we're going to have to hunker down because all hell is going to break loose because we'll be on full-on socialism for the Biden second administration.
So people are going to start really starting getting nervous.
And they're going to be starting taking profit.
If people think Trump's going to win, you know, the market's going to shift towards those things that Trump's going to be into.
If Biden is going to win this election, everybody's going to be shifting towards really a more socialistic point of view.
And there's certain stocks that win and lose in that environment, too.
So, you know, as a trader, I have to set my own personal feelings aside.
Right.
Somebody gave me an adage a long time ago.
Do I want to make money or do I want to be right?
Right.
Now, let me ask you something very quickly.
Is Bitcoin too late to get into?
People are saying, oh, gee, I missed my time.
Is that over with?
Has that ship sailed?
Absolutely not.
Once it's $74,000, you can get a double on Bitcoin yet.
But Bitcoin's not the only game to play.
So there are these high-yield options out there that are associated with Coinbase, with Square, with MicroStrategy, that they create these collars.
Right.
And these collars are designed to give you leverage, and they'll pay huge, huge dividends.
And so, I mean, you're talking, you know, last year.
You know, the ones that tracked NVIDIA and the ones that tracked the Coinbase and MicroStrategy, you're talking between 70% and 130% distribution of the underlying price of the contract.
As prices go higher, these contracts get worth a lot of money, and then you also get these high dividends.
So I'm in all of those, plus I'm in the Bitcoin future, BITO.
So you could be leveraged to Bitcoin without having to open up a crypto account.
And that's my personal preference.
Obviously, people are Bitcoin maximalists.
If you don't own your coins, you don't have them, right?
But I like to monetize everything I own and generate cash from it.
So that's how I'm trading it.
We're doing really well.
Our customers love it.
And we're making a lot of money.
And people that trade with us will show you the strategy, and you can trade with us as well.
Now, for those who are not familiar with you, there's nobody like you in terms of what you are...
I don't want to say preaching, but what you're selling.
We've said this before, and if you don't want to say it, I'll say it.
If you're watching anything on TV, if you're watching any kind of cable finance program, you're out of your mind.
That's number one.
Number two, you always shift with what happens.
You never say, well, that's it.
Just now I ask you this stupid question.
Is it too late?
When before we've said the past, there's never too late.
There's something happening.
Up, down, it doesn't matter.
You profit.
Always, but in different sectors, different angles, different theories, different strategies.
That's the thing about you.
You're not pie in the sky.
You're not an either-or.
You're a, let's look at this, read the horizon, and act accordingly.
Now, right now, Bob Cutler, if somebody wants to go to tradewithlionel.com and says, this is terrific.
I don't know anything.
He talked about liquidity.
I don't know what the hell he's talking about.
But I want to get in.
I want to be a part of this.
But I don't know anything.
Or maybe I know a lot.
Tell me what happens when you go to TradeWithLionel.com or if you call 800-949-1408 and tell them that Lionel sent you.
What happens?
Well, it's really simple.
So what we do is we provide you with access to our algorithm.
And all you really know about it is that it tells you when to buy and when to sell.
And it tells you whether or not you're buying the dip or you're selling overvalued assets.
That's it.
So you don't have to know anything about trading to be able to start taking advantage of because it's very visual.
We created it for people.
We simplified the whole process.
But more importantly, we give trades out every day.
So you can follow those trades and literally the next day, as long as you have access to a phone, Or a PC, you can get the alert sent to you, and you can trade those.
We obviously have chat room where people can ask questions, and then there's training videos on how to use the algorithm, what the setups look like, and things like that.
But literally, in one day, you can start taking trades.
But if you want to get proficient, three to four months.
And if you want to do this for a living, three to four years.
So that's kind of what I tell people.
I would say at least half my customers work.
So they just want to get the alerts.
They kind of want to know what's going on.
They've got a job to do.
They can set their trades.
That's the beautiful thing about technology today.
You can literally be working.
You get an alert.
You go to the other app on your phone.
You can put the trade on and go back to work.
You literally, you know.
Wasted 30 seconds of your time.
And as you know, working in an office, probably half the day is really wasted time anyway.
Oh, yes.
Oh, yes, indeed.
You don't have to be glued to your desk to trade.
The other thing two people don't realize, the first two hours of the trading day are the most important.
The rest of the day, a lot of it's just noise that you shouldn't be trading anyway.
And then the last half hour is important.
So you literally, if you even did this for a living, you can be...
Two and a half to three hours a day.
Spend the rest of your day.
Like when I'm done with you, I'm going to exercise, right?
So you got to get yourself away from the desk.
Now, let's go back to some other.
I love your trends.
The final blow-off.
Last time was the big rotation.
You see things coming, and you always speak about next quarter, next month, next year.
This is what's happening.
And it's very also, and I'm so glad you said this.
Irrespective of what...
You know, I do it sometimes when somebody asks me to predict or if I comment on a case.
I say, well, I think they're going to...
How dare you?
No, I didn't say I want this.
I'm telling you what's going to happen.
It's like being a pathologist and holding up a lab result or a radiologist saying, yep, it's broken.
What do you mean?
I'm telling you reality.
Tell us some other great stuff, too, about Bitcoin, real estate, gold, copper, metals, stocks, bonds.
Give us a bit of information that nobody knows.
You know, within reason.
Something that nobody's talking about.
Well, that's a better answer.
The market doesn't hide what it's doing.
It's really your belief.
Obviously, you as an attorney, you've seen it every single day.
People are just blinded by their own narratives.
But the market has seasonalities to it.
And the market has, what's he calling, liquidity is just an infusion of cash for speculation.
That's all it is.
And then so, but there's certain things that, it's a simple math.
You know, when the Federal Reserve lowers interest rates for the first time, if you're not out of all your speculation in the stock market, you're going to lose money.
Okay?
There's a truth that...
That people know, but people don't yet believe or grasp it's going to happen.
And so, but we have math and we have probabilities on our side to tell us that, you know, there's greater than a 90% chance that's going to come true.
And in stock trading, if you have anything better than 65% or 70% chance of it happening, you take the shot.
And so, like, big money is already starting to move into the longer bond yields.
Because they know going into a recession, that's the safest place to hide.
And also, recession is baked in the cake.
The Federal Reserve guys are out there today saying the risk of recession has evaporated.
They're absolutely on drugs.
They're absolutely going into a recession.
Well, why would they have any incentive to tell you the truth?
It's like the moral hazard, so to speak.
Why would the Fed...
Ever.
They always have to justify their existence.
Nobody knows what the hell the Fed is.
I'll never forget one time they asked, who was it?
Alan Greenspan.
They said, who can replace you?
And he said, nobody.
No one.
I mean, somebody said the Federal Reserve is as federal as Federal Express.
So why would they go out and basically do something to denude themselves of this myth of being able to handle or being a part of the government itself?
So right off the bat, I can impeach that witness.
Well, look, you know, the two-year yield actually can stand in for the Fed at any moment.
The Federal Reserve is designed to allow the government to overspend and allow the banks to get free money.
That's all the Federal Reserve has done.
You can set up any kind of construct.
If you were worried about banks having what's called a mismatch, the reason why Federal Reserve was, quote, unquote, created was to protect banks on a mismatch.
What a mismatch means is that you and I have our money in a savings account at the bank, right?
We have what's called a demand deposit.
That means we can demand our cash at any time.
But if you and I get a loan, we may get a loan for seven years.
They can't demand my repayment of that loan unless they don't pay it.
And so if tomorrow you and I decide, and you and I are the only two people in the bank, and you and I decide tomorrow that we don't want our money there anymore or we want to do something differently with it.
Well, the bank doesn't have our cash.
So what the Federal Reserve is designed to do is they pledge my loan to the Federal Reserve, and the Federal Reserve creates the cash to give you and I to satisfy our demand for the cash.
That is what it's supposed to do.
And it turned into this monster of opaqueness and insider deals.
And money to European banks and interest rates, you know, they should not even be involved in interest rates at all.
The market should decide what the cost of money should be.
But they create this incredibly complex monster.
To confuse people.
But if you ever notice the two-year yield, the Federal Reserve follows the two-year yield.
So if you start seeing the two-year yield fall, you know interest rate cuts are coming and vice versa.
So, yeah, you know, and you start to see it.
Look, you know, Argentina's starting to take control of their Federal Reserve.
I guarantee, you know, the Communist Party runs the Federal Reserve in China.
There's no independent Federal Reserve there.
But the Federal Reserve really is designed to support basically the elites in Europe.
But it could absolutely be replaced tomorrow.
It could just simply be the two-year note is now the cost of money.
And if you as a bank need to borrow money to satisfy your demand issues, you simply have to borrow from the Treasury.
The mint could produce as much cash as it needs to be produced, and the mint could destroy cash as it needs to.
We already have a constitution for that.
So yeah, they absolutely can be replaced.
Will they be replaced?
We'll have a civil war before that happens.
Right, right.
Exactly.
Now, Bob Cutler, the reason why I laugh about this is that so much of this is so Byzantine.
It defies any kind of logic.
But I gave up years ago, because my understanding of it...
It means nothing.
Or my approval of it.
The bottom line is simply this.
With all that, and you and I have known each other for a long time, what is the best and what people have told me about you is that you are straight up.
You're honest.
You want them to know, this is what I'm trading.
This is what we're trading.
I want you to make money.
This is our return.
This is how we're doing.
Transparency.
No opaqueness.
This is what it is.
If you want to know whatever level you would like, we are here to help you.
And I know sometimes people are flooded with this.
And they say, yeah, right.
Because you hear it all the time.
We are just bombarded by show.
But you're different.
And I'm not merely saying that because you're here.
But it's true.
If there's one thing.
One thing that you are the proudest of, of your organization, of Trade Genius, also TradeWithLionel.com, what is it?
The one thing that separates you from the rest?
I would say consistent performance.
So the algorithms that we created have been very consistently...
Performing at what I would call an acceptably high level.
And this has been for years.
I mean, even before I had Trade Genius, I had a private group called Bob Loves Trading and Bob Stock Signals.
And we've always had this range because what we like to trade, we call it the middle 60. So I like to trade things that are trending up.
I like to then buy those on sale.
And we just basically designed the algorithm to give us an opportunity to win two out of every three times and to be able to take one, two, or three percent in aggregate net of loss on our trades.
And it's just been that way for years.
So I say that that is very important.
In trading, especially when you're building a portfolio, you want to have consistent...
You know, even our government as a Christian, I am bound to support my president, whether or not I, how I feel about him personally, or what I think he's going to do to the country.
That's not my concern.
So I try to always be.
Good.
I can tell.
That's kind of where I'm at on this.
Because, you know, one thing people, and I'll just speak to it personally, is that you can't control 90% of this stuff.
So why worry about it?
You know, all you can control is how you're going to be able to react to the situation.
If you're lucky, proact, right?
So, you know, I know that we're going into a recession.
Math simply tells me.
So am I out there, you know, blowing money left and right?
No, I'm out there raising cash right now.
I'm out there starting to get defensive.
As the market's moving higher into this blow-off, I'm taking chips off the table.
And I need to make sure that, you know, with the big years, you have lean years.
And you have to be able to, you know, fight another day.
And so that's kind of how I, you know, I view things and view life.
And, you know, you and I have been around the block.
So we know there's nothing new out there.
You know, cycles are cycles for a reason.
And people need to prepare for it.
And I think you said something in the very beginning is that you can't watch TV.
Yes.
They're absolutely designed to separate you from your money.
Okay?
I mean, you have a Fed president out there telling you that recession odds have evaporated.
That is absolutely a blatant lie.
They see the data.
You know, when you have more people not working than working in an economy, that is not a healthy economy.
When you have inflation that is up 22% in three years, okay, that is not a healthy economy.
So what they do is they, and I love this word, you know, they gaslight you.
And the reason why they do that is they...
They want to be able to panic first.
There's another attitude trading.
He who panics first panics best.
So they want to keep you in the frog pot while they all hop out until it's too late for you to get out of the pot.
Because they want you to be what they call exit liquidity, meaning you're the sucker at the poker table.
So they tell you lies until it's too late for you to be able to...
Profitably escape.
And you know, I've got to say this just politically.
Maybe you don't want to comment.
You know, but there's another term, Bob, in our society all the time is this thing called, you know, misinformation, disinformation, lies, hate.
Well, misinformation and disinformation, they went absolutely crazy if you mentioned something about, let's say, a medical procedure or about a medical condition.
But somebody can go on television and say that a blatant, absolute lie is something that is just nothing but duplicity when it comes to investment.
Nobody cares about it.
Nobody cares.
Billions of dollars can be wiped out.
So anyway, that's enough with my...
Well, you know why that is, right?
I mean, CNBC operates under advertising revenue, right?
Well, who do the advertisers?
People selling stocks and asset management.
So there's no way they're going to go ahead and shoot themselves in the head, right, by being an honest broker.
Right.
And the medical misinformation was because...
The number one advertiser for news programs is pharmaceutical sales.
Look, I'm not anti-pharmaceutical.
My wife wouldn't be alive today if it wasn't for the drug company.
But it doesn't mean that they don't do things that are wrong.
No, of course not.
And also, every now and then, there'll be some story about, I don't even know, this AMC, some guy comes along, big kitty, little kitty, some big kitty, and they'll talk about these kind of tangential stories about the market or whatever, and I think they lull people into thinking that this incredibly complicated but workable system is like People magazine.
No, it's not.
That's a cute little story, but there's a little bit...
It's more complicated than that.
But anyway, I don't want to preach.
No, no.
I mean, look, it's important.
You know, I mean, if you're listening to me, you're probably, people are anxious.
They want to make more money.
And how do they do it?
There's a lot of people out there that just tell you how rich you can get so fast.
And that's, look, I've been doing this a long time.
I mean, I'm coming up on, I don't date myself for 30 years, 30 plus years doing this.
And the only way to get rich in this business is slowly.
And the more risk you take.
The more likely it is you're going to have drawdowns that are going to set you back a couple years.
So you just have to be prudent.
Follow the seasons.
Follow the trends.
Follow the cycle.
I mean, look, trading works like a sine wave.
Most people buy here because that's max news coverage.
You want to buy here when there's wind, and you want to make sure it's still trending the right way.
So that's all we do.
And you don't want to chase stocks and chase trends.
You don't want to jump into the last minute.
Such implicit sense.
But the best news is tradewithlionel.com.
Go to tradewithlionel.com or call 800-949-1408.
800-949-1408.
Please tell them Lionel sent you.
So all of a sudden the bells are going off.
They go, oh, oh, good, good.
Because you always take care of our great viewers.
And it's never too late.
Don't ever think like, well, you know, that's for a young man.
I'm over.
It's over for me.
No!
No, no, no, no.
There's always something you can do and always something you can do better.
Yeah, I mean, look, what we charge for the service is nothing can everybody get out of it.
So, you know, the risk-reward's in your favor.
You know, I mean, you can even go month by month with us.
You know, obviously, I'm only as good as my last trades, right?
So, you know, it's in my best interest to make sure that you make money or I wouldn't have a business.
Absolutely.
Yeah, so, you know, it's easy to get in.
It's easy to try.
It's easy to take a shot.
And, you know, we view ourselves as white hat people.
Well, Bob Cutler, you are the best.
TradeWithLionel.com, TradeWithLionel.com, TradeWithLionel.com, or call 1-800-949-1408.
And please remember...
Tell them Lionel sent you.
Bob Kudler, as always, my friend, thank you so, so very much.
Have a great and a glorious time, and I can't wait to speak with you again.
Great.
Thanks.
I'll talk to you later, Lionel.
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