Are Bulls and Bears both in for a Beating? w/ Darius Dale

foreign [Music] are the bulls and bears both screwed hi everyone Welcome to the Real Vision Daily Briefing with me today is Darius Dale founder of 42 macro hi Darius hey Maggie it's a pleasure to be here how are you great to see you and we're asking that question specifically for you because you tweeted last Friday and it caught our eye and you are worried that both the Bulls and the Bears may be at risk here walk us through what your thinking is yeah so uh it really starts with you know kind of where Market positioning and Market consensus are if you look at the bond market particularly short-term you know forward rate spreads whether you look at the feds near term forward spread or you look at other forward spreads whether it be the 12-month Ford you know t-bill minus the spot t-bill yield they're pricing in a very significant amount of fat easing over the next you know you know 12 to 18 months and if you look at Bed funds Futures that easing is likely to start or at least what's currently priced into the market in uh in November of this year that's actually changed since September over the last week or so and so what we're looking at in term terms of both liquidity and factors in the real economy could actually see some of that pricing you know kind of come out of the market in terms of bond market volatility in the coming months at least a couple month with a couple of quarters before we get into the kind of recessionary phase of this business cycle so um I have a couple charts that I'd like to share with that on that topic uh first chart Brian if you can throw that up uh where we show the US consumer looking at the pce report um in the top panel we show real real personal consumption expenditures which are 70 percent of the US economy are growing and compounding on a three-month annualized basis at 4.3 percent and that's basically double the pre-covered trend no one's talking about this because everyone keeps talking about recession but you're seeing housing data pick up in recent months obviously the consumers remaining resilient because we have a significant amount of real income growth that's it 7.6 in terms of disposable personal income so we do have a consumer resilient consumer but the all the issue as it relates to the bond market is slide two Brian if you throw it up on the screen where I uh Circle the top panel on the bottom panel we got core CPI still compounding at five percent on a three month annualized basis but more importantly than compounding at five percent is the fact that it is in the same place that it was five months ago so we have a lot of disinflation on a year-over-year basis but that disinflation is going to stop in the coming months if we don't start to see these sequential time series break down and at the bottom panel in that chart there we show super core CPI compounding at four percent that's just 4.1 percent that's twice the best in uh preferred Target and it's in the same place that we were four months ago so I'm not sure we're out of the woods from the perspective of bond market volatility purely from the perspective of the recession being delayed relative to kind of investor consensus yeah I want to I want to get to why so that's that's why the Bears are potentially in trouble um but I want to get to the Bulls but just before that I want to bring up something that we we got to comment right before we came on from gym uh saying and we asked him to clarify but he he's saying doesn't anybody remember the FED said that that they wanted inflation for longer to make up the period where they couldn't get it to two percent and that's true but did they want this kind of inflation I don't think so right like they wanted sort of trend inflation not disinflation but this is this is way above what they're comfortable with isn't it yeah you're absolutely right in fact they scrapped their average inflation Target which is what the the viewers um kind of alluding to back in the fall of 2021. if you mentioned if you hear the price stability Target their target is two percent they have not said anything about an average of two percent really since the fall of 2021 so I don't believe that the FED is operating under that framework that was the kind of Maximum and inclusive employment framework you know the uh the average inflation targeting framework when they thought inflation was transitory I don't think anyone at the fomc thinks inflation is transitory at this particular juncture so I don't think that we have to worry about that as investors but there are a lot of other things we need to worry about yeah yeah and by the way if anyone wants to hear for those of you who missed it Fridays are tough we had an extended with Dennis Lockhart who was the former Atlanta fed president sat around a lot of fed meetings had some really really interesting things to say fed officials are usually really kind of closed up um and he is former but he was was very interesting in talking about the thinking and he talked about kind of that that recency bias from when they were stuck in that environment where they couldn't get inflation to move and you know having to adjust to the prospect that maybe they're in a a new macro regime and you know they're just like everyone else right trying to figure it out very interesting kind of digging into to all of that I mean we didn't extend it with them so if you missed it or if you weren't able to stay for the extended um you know hop on that QR code and you can get on and see it because I think it was really some really interesting nuggets in there but Darris okay so back to your thesis so bears are stuck what's the problem with Bulls why are they at risk well so the problem with Bulls is just the the time decay of this bearish positioning um obviously if you look at dispersion within the equity Market we're actually against pretty negative signals that we spoke about in our late off morning note this morning but dispersion within the equity Market has been trading or trending very negatively as negatively as it ever has you know if you look at the time series over the last kind of 25 30 years and so that implies that you have a buy side consensus is that is very grossly exposed to the market they're really long their lungs and they're very short they're shorts and they have a lot of gross exposure in the market and that's based on you know this kind of negative economy recession View and so you kind of roll the clock forward if we don't if we don't go into a recession you know over the near area near term which many investors think if you look at Bloomberg consensus estimates you know they're calling for the first quarter of negative GDP in the second quarter of this year you look at bottom-up analyst estimates in fact Brian that's slide four uh we put up a slide four where we show S P 500 analyst estimates at the bottom left of that chart where sales and earnings growth they're looking for minus eight percent earnings negative earnings growth in the second quarter of this year now what if it comes in at you know minus two or three which is kind of where it's been at over the past couple of quarters and so you could easily see you know a very big convergence trade kind of snap into into those uh into those investors But ultimately what tends to happen late in the bull market site or this is definitely not a bull market what tends to happen late in the business cycle is that one by one investors have to capitulate to the realization that the recession hasn't started remind me we've been talking you and I have been talking on this program about the potentiality of a recession since going back a year ago and the new curve inverted you know back in October if you look at 10 year three months or back in June if you look at 10-year two-year so it's been quite a while for a lot of investors to be running around talking about recession but guess what I just said the economy is doing you know I wouldn't say just fine but it's do it's hanging in there and it's likely to continue hanging in there according to our business cycle timing models until you get into the fourth quarter or maybe even as late as the first quarter of next year so you roll the clock forward that's the same problem that happened in October 2007 it's the same problem that happened to Bears in September of 2000 which is you just capitulate because it's not happening soon enough and they always capitulate at the right or wrong time so I could easily see a lot of bond market and stock market volatility in the third quarter you know for liquidity cycle reasons that could easily rotate it back into kind of a blow off top into the early part of the fourth quarter because bear are just capitulating and then that's when the movie's likely to start so it's so so basically the timing is screwing everybody because the Bears the it'll it'll it'll be delayed enough for the Bulls to think they're right and the Bears will throw in the Hat and exactly when the Bulls are convinced they're right it'll happen the Bears have already got out of the trade and the Bulls will be stuck in it because they think it's a soft Landing a hundred percent I mean go back to that chart I just put up slide four look at the the so go back look at the farthest right candles are on that chart the blue lines represent I get S P 500 earnings growth and those bottom up analyst consensus is calling for earnings growth of plus nine percent in both Q4 of this year and q1 of next year now that very much rhymes with the view that sales side consensus had coming into 2023 which is recession first half recovery second half recession first half recovery second half well if we don't have a recession in the first half the recession does not start in the third quarter we're going to be talking at least a lot of investors are going to be looking around and saying maybe that was it that's paused time to go time to get long and that's exactly the right in our opinion that'll be the exact wrong opportunity to get long there's always there's always a couple of things that complicate this aren't there one of them is that things are different this time and we do have this enormous wave of AI and just today there are reports out that hedge fungi and Stevie Cohen made comments at a private dinner that he's pretty bullish about the market because of everything AI is going to unleash I mean we're also hearing from voices who say it might wipe out mankind but another thing for us to worry about but you know you do have this sense that and and you've seen it Nvidia Microsoft I mean Super narrow but you can see the money sort of piling into that it makes it hard to figure out whether you can kind of trust some of the others so how are you thinking about that yeah that's a great question so I mean I I think well you know this is something I don't think this time is different there are you know bulls and bears operating financial markets being driven by fear and greed and the cycle is going to continue the cycle obviously there's different things in each cycle um but the in my opinion AI is no different than the internet I mean put up slide five Brian uh where we show um where we debunk one of the myths that U.S uh everybody's bearish well if you look at the second panel on this chart on Slide Five we're showing household allocation to stocks as a percent of their total assets and that's at 31 down from a peak of 36 percent in the middle of 2021. that 31 percent is just shy of the all-time bubble.com high that we received that we saw back in in 2000 and so you know the internet was this awesome thing back in 2000 and everyone was spending from a corporate perspective as much money as possible to to kind of lever you know leverage that um that opportunity but that didn't stop the market from getting cut in half and so in my opinion you know just because you have a you know a fundamental Tailwind if it meets the wrong part of the macro cycle particularly if it meets the wrong part of the liquidity cycle which I very much think it will in the third quarter and in the first half of next year you're going to have a lot of a lot of uh it's gonna be a lot of questions to answer about you know where this AI stuff is coming from Gary so it's a very painful truth you just laid on us there because if you think about that I mean it is true if you look back and by the way that did Lay the groundwork for like enormous societal changes but but you're right like in that can be a lot of froth especially when people are trying to sort of just throwing money when they're not sure what's going to work or they're not sure if there's going to be you know a standard or a winner I mean this is what we're all talking about all the time so it's it's scary but really excellent point to bring up that comparison to 2000 we're going to be talking a lot more about that I suspect um the other thing that comes up all the time and I'm gonna we're gonna play a clip from an interview because this is the other sort of argument I think that comes up so Harry malandri spoke with tomcatic managing director at Ned group investments in the latest installment of the next big trade now they were talking all about commercial real estate but Tom did sort of discuss his overall macro Outlook let's have a listen to that and we'll talk on the other side your view has to be built on some kind of broader macro view about the likely recession risks we're facing and the intensity and duration of any of the coming recession or if there is even a recession because obviously If the Fed rate raises rates some more you might not necessarily be so bullish of of real estate and also if recession is sufficiently intense uh that could also put you off real estate as well so what sort of recession risks have you built into that view um so our base case our base case is that we will start we've already seen peaking inflation certainly in the US we're starting to see Peak inflation in in UK and Europe um and that we will continue to see a slowing but continued upward cycle in terms of in terms of Base rates but that that is slowing and we will start to see that moderate and move to a more dovish or more commodative uh environment from central banks so looking towards the end of this year um to start to see evidence of that so clearly some some continued headwinds but that's all a lot of that is already priced here sure you know you just need to look at the yield curve to see that just that's a little snippet of what was a really interesting conversation about commercial real estate I know a lot of you have been asking about that so if you're interested to see what Tom's big trade idea is around that um you can go check out the full interview on our platform if you're not already a member scan the QR code so you can hear all of the episodes of the next big trade we love that show uh so Darius this is this so when he said that this is sort of reminded me of what we hear a lot um and that's okay there's going to be a recession but you know most of the bad news is already telegraphed you know the Market's a forward you know discounting mechanism um a lot of the bad news is already priced in what do you think about that do we need to be you know is the timing issue going to create a problem with that uh so it's a one I would disagree with the view that markets are for looking I think we've back tested asset markets as well as anyone on the sale side uh and I say that very politely um and when we construct those back tests you know we're looking at very sophisticated you know statistics like expect to return sharp ratios covariance all that stuff you you what you really quickly find is that back the markets aren't really look more than kind of two to three months ahead yeah once you get into the four to five months ahead time frame There is almost no correlation between the market and things that you would think to drive markets like earnings GDP growth thank you for that because I always feel like it's more reactive than predictive but it's much more reactive and the reason why Maggie if you Brian if you throw up size six is particularly particularly in the post-crisis era I would argue markets are probably a lot more forward-looking prior to the GFC but post GFC liquidity has been the dominant driver Rouse been all over this in in recent months in terms of his talking about his model uh we win this chart here on Slide we show our Global liquidity proxy which the sum of the G6 central banks the G6 economy are the largest Six economies in their narrow money supply as well as World FX reserves minus gold and that's some of that and that that blue line that some of those uh three factors has a 0.94 r squared to Global Equity market cap and a 0.95 r squared to the s p over the since 2009. and so it's if you're telling me that markets are forward-looking you're basically saying that liquidity is not the driver of markets which you know I think you have to exit you'd have to exit most rooms on the buy side and we make those kinds of comments but one thing I would call out particularly in terms of the headline of this chart which is you know there's been a lot of talk around on Twitter and and in the kind of Finance Financial ecosystem about kind of global liquidity and how it's been proving and it's going to continue and improve and that's really got a lot of people trapped at 31 000 in Bitcoin get a lot of folks trapped at 4 200 in s p terms in our opinion because the recruitment in the global liquidity cycle has not been linear um as you can see in those Max drawdown studies middle panel and the bottom panel of this chart the recovery and asset markets which is the bottom panel of the s p the recovery in the s p of the October lows has been somewhat linear at least it's sold out in the last couple of months but the Improvement in global liquidity is very much not been linear and that kind of scares me because if you look at the next chart Brian where we play around um you know World Equity market cap and the red line and we lay around Bitcoin uh both in price terms uh in that in that same analysis in those bottom three panels we show trailing one year's z-scores for each the global liquidity proxy for the marketing market cap and for Bitcoin and Global liquidity policy still trading at a minus 0.6 Sigma whereas World Equity market caps up here at a plus one Bitcoins at a plus one Sigma so they kind of ran up like the recovery in global liquidity was linear but the co-operating will be a cleaning the recovering Global liquidity is not linear and it's going to get increasingly not linear once we get into the third quarter or whenever we get past these debt selling negotiations I can unpack that as well yeah we we certainly want you because we have questions about both but let me let me bring one in that is related to bitcoin since you're since you're mentioning it um Miguel asking does Darius still see Bitcoin at 10K in the short term 10K no that's not yeah I don't I don't know where but it's not a that's not a comment I've made ever so what so so are you suggesting with the look The the liquidity that it's going to be volatile I mean how are you seeing that I mean we've probably seen the year to date highs I mean maybe not the year to date Highs but certainly I think we've seen a high for for a little while now I mean Bitcoin and ethereum actually just broke to neutral from bullish in in terms of our volatility just a momentum signal this morning so I would call that out if you're long Bitcoin you know you're probably going to be walking into an environment with a lot more volatility than we experienced in recent months uh number two just in terms of like this this concept of liquidity there's a lot of stuff going on we've talked about this in the most recent um I was on a couple of weeks ago but when you passed a debt selling so clearly there's a potentiality for a negative Market event into the debt selling the closer we get the more likely we're going to see something that looks like 2011. I think we can all agree on that what we I think the the bigger more structural overhang for asset markets on the other side of the debt ceiling are twofold one we got to take the tears or general account balance from zero to 600 billion dollars or at least that's what the the the treasury is outlined um for the end of the SEC the end of September or a quarter and then number two that we're going to return to net coupon issuance it's going to go from basically zero to something greater than zero which means quantitative tightening which has not been draining Bank Reserves over the past six months is going to start draining Bank Reserves again and so in our opinion you got you're you're dealing with the negative liquidity situation in the U.S that suggests that the dollar could actually start the bottom and rise again which would obviously be a tertiary a headwind to Global liquidity as well so it the liquidity backdrop in the third quarter is actually quite poor you could see asset markets trading like much like they did in 2022 which is stocks down bonds down but ultimately if we're you know if the recovery if the recession is as delayed as I think it's likely to be which is Q4 or maybe even q1 of next year then you could probably recover from those levels if we're wrong on the timing of recession and it's you know Q3 or Q4 of this year then I think you could easily go from a negative liquidity environment causing volatility and asset markets to a negative economic environment causing capitulation in asset markets wow I think that we are going to have to start turning the daily briefing into happy hour because we might need some fortification for for some of these but but information is power right and offense is the best defense and maybe there's another one I can think of but you need to know we need to be thinking about this because as you pointed out earlier a lot of this is not priced in and and that is should make us all a little bit nervous so let's get to the debt ceiling some questions about that uh Scott is saying how do you feel about longer duration Bonds in the context of the debt ceiling uh so our our weather model which is a pretty sophisticated Dynamic Factor model that guides our asset allocation process is currently bearish unbox liquidity is quite poor there are a variety of other metrics in that system that's causing the bond signal to be negative not the least of which is the fact that investors are actually sure rates uh by an extreme degree and historically being short rates uh has historically been led to negative um xanity returns in the bond market so I don't know that it's a good idea idea to be getting Max longer bonds here now we've seen a pretty nasty backup in yields over the past couple of weeks you know basically 20 basis points over the past couple of weeks so if you're trying to play allocate to the recession Playbook or more importantly if you're coming from a I didn't believe the recession is likely to I now believe Darius and it's probably going to start in six or nine months then I do need to start dipping my toe in on Bonds on on dips but from the perspective of our of our Fort looking models which are you know trying to manage the medium term between now and then I don't think this is the time to be you know Max long bonds because again you're getting net coupon issuance you're getting TGA refill you're getting potentially dollar up which obviously reduces demand from the foreign central banks for U.S assets so all those things could actually be you know could spur more bond to Market volatility if we're right that the Brazilian economy is likely to contribute to resilient inflation between now and then one final point I'll make on that there is no time series history in the history of the core pce time series of it breaking down substantially ahead of a recession you always need to go through the recession to get to the actual decent donation process so all of the disinflation we've seen in recent months and quarters has really just been removal of supply chain issues you know kind of um you know unwinding of some of this fiscal large s but we're going to settle out as we spoke earlier about this we're going to settle out at a level of inflation that is significantly uncomfortable for the bond market in our opinion over the next let's call it three to four months yeah so great distinction there with time frame so your time frame really matters here we talk about this in the academy if you are medium term that's what Darius was just Drilling in on there if you are longer term then you know and you and you have that other view of the recession six to nine months out then then maybe but but really judiciously and tactically it sounds like on dips um but that's a really important distinction thank you for that Darius Sammy has a I think a complicated question but let's see if we can tackle it uh fed guy Joseph Wang believes fed will continue QT on stage but then buy treasuries behind the curtain once the debt ceiling deal is reached and then TGA issues treasuries to Market do you think Bank Reserves will be used to buy treasuries or will the FED buy them QE I mean I guess you have to agree with the idea that this will happen at all before you answer that question I don't know have you been thinking about I mean it's sort of what happened before right outward facing QT but behind the scenes they're sort of like what the what what the UK had to do when they had their guilt crisis you see something like that coming down the pike no no the the FED has not been purchasing uh assets the FED has expanded the balance sheet vis-a-vis it's emergency lending facilities so we could see something like that I certainly would rule that out but certainly the FED I mean this is a Federal Reserve that is failing on its inflation mandate by a factor of two to three they are nowhere near at all near administering quantitative easing in large glass of purchase program in into this into this economic environment I mean we have to don't forget we the Federal Reserve if you look at their last summary of economic projections in the month of March uh we're going to get the next one in June but let's just assume it's going to be somewhere near the same they're calling for a hundred basis point back 110 basis point back up in the unemployment rate between now and the year end so that's obviously probably going to come down but they're going to push it out further into 2024 which ultimately means irrespective of when back out you know when it backs up they're effectively calling for a mild recession because there's never been a 100 basis point move higher in the unemployment rate that did not coincide recession in the history of the U.S economy and so the likelihood that once asset markets are really starting to move to price and recessions you know consider investor or household kind of you know liquidity preferences start to change when they get worried about losing their jobs or you know if their business not doing as well you know and the people start to rotate out of the equity Market that is not going to be your friend in the early part of that movie The Fed is going to be eating popcorn alongside me and our clients like man I told you so this is coming we need this pain to get back to a more sustainable and stable inflation environment that will allow the U.S treasury to capitalize itself at sustainable yields right now if we let the inflation Genie stay out of the bottle we're going to go from negative 50 some basis points and turn premium to 10 year to probably plus 100 to 200 because again you have the price in that additional volatility that comes economically with higher levels of inflation Roger kind of asking a question along these lines with the markets going up so much why would the FED ease duh yeah smart man I don't have anything smart to add to that maybe it was a rhetorical comment but yeah that that that doesn't do much to sort of help them um you know do the work for them um Achilles asking what do you make of the concentrated rally especially Nvidia we kind of talked before that it's not different this time but do you see that as a risk that the equity rally is so concentrated in such a few names uh so not in isolation I I do see it as a risk today in fact this morning our dispersion model which was what we discussed earlier uh actually triggered what we call a GTFO signal so that's a tactical de-risk degrow signal before everyone else is forced to um so you know who knows how long that signal May last in terms of playing out but this is not a it's not a structural call it's more of like the next month or two you know kind of uh take down take down risk because of all the crowding that we're seeing into cyclicals and crowding out of defensives by an extreme degree oh sorry my apologies the crowding we're into defenses we're seeing from a sector and style Factor perspective and the crowding out of cyclicals both to an extreme degree once we hit both extremes that's when the signal is triggered so I am concerned now I was not concerned prior to this morning because that's what always happens late stage you know later stages of the business cycle which is industry concentration you know the mega cap concentration these companies are great at what they do they can buy growth they can buy back stock they can increase their dividends they can survive until the recession hits whereas a lot of other companies are going to go by the wayside and that's one final thing I'll make on this comment everyone thinks a recession is like this light switch that you turn on we're all in recession no recession is a rolling series of events between households and businesses the worst businesses the most lever businesses the businesses with the worst cyclical prospects are going to go into recession first same with the households who you know people who spend the most money or have the most credit card debt are going to go into recession first and the people who have been more prudent in the businesses that have better prospects will go on a recession last but eventually we'll all be in recession uh Andrew asking does DG have any opinion on oil and gold before the arrival of recession all in gold gold is tricky uh oil no no real opinion I mean if we couldn't rally oil with China reopening the oil's going probably 50. let's be totally honest here if you couldn't get oil to 90 with China reopening it's going to 50. so I think that's that's an easy call gold is very difficult because historically so they have some very cross you know big cross guns factoring into gold you know obviously the recession Playbook you know tends to say you want to be favor and goal assets like that and then you also have you know clearly what could potentially be more you know oh what's it called the the small Regional Bank you know kind of Crisis that if you will the FED is forced by markets instability to kind of add more liquidity in the market that's something that's been very supportive of Bitcoin obviously uh digital gold this year so gold is is in a tough spot from that perspective because that makes sense but we're talking about the potentiality of liquidity you know reduction in liquidity in the third quarter that could potentially spill over into the fourth quarter I would not be buying gold here into that in the same way that that would not be buying bonds here uh into that really any asset because most assets are correlated but was asking is China's reopening really a nothing Burger is it just that we're not going to see that that sort of you know bump to Global activity because of the nature of the reopening and maybe the domestic focus of it or is it just a timing thing again is it just slower and longer to get ramped up than we anticipated well so in my opinion we can have a real Vision Daily Briefing on this but I will be brief so there's three things that we called out back towards the beginning of the year in February specifically uh we sold China back in February and we called out we said hey look it doesn't look like they're going to stimulate from a fiscal perspective we got that signal um immediately after from the party Congress from outgoing Premier League who outlined a very muted growth process Target outlined a very tight uh fiscal deficit Target which tells told us these guys aren't going to hit this you know the ground with shovel ready projects and the way they've done in previous Cycles so that was kind of number one number two China's was in a structural liquidity trap in 2019 prior to covet this was an economy that was on its knees prior to covet and so reopening from covet you're going to get a level reset higher in activity but that doesn't necessarily mean you're going to continue to accelerate because again this is an economy that was really struggling and number three the reason the economy was struggling is because of the debt overhang you look at private non-financial sector debt in China I think I want to say it's up around 220 230 percent to GDP that number is like around like 150 or 160 in the US so these guys have gotten way over their ski tips from a private sector leverage perspective and in my opinion I think that's part of the reason president XI is very reluctant to kind of you know turn the investment Dow back up again because ultimately they know all they're doing is selling the seeds of a more deflationary kind of long-term destruction in that economy so no we kind of knew this was coming I think everyone else is finding on real time uh last question and it's from two different people variations of it uh both Jason and excuse me and Jay do you sell out of equities when the market gives you an option and holds cash and bonds Jay was more worried about a risk to money market funds if the debt ceiling isn't revolved in uh isn't resolved rather but same question is it risk management to remove funds put them to cash temporarily until we're sorted it's cash king you can't get enough cash I've tried this I tried to shoot a rap video of my bachelor party and I needed a ten thousand dollars and you can't even take two thousand dollars I don't think so no you can't get out now if you're if you're a serious investor you're probably not going to get enough cash look this is what I'll say if if you're worried about your k your liquidity exposures in your portfolio your cash your T bills you know however you manage your liquidity you're missing the force for the trees because if the U.S defaults everything else in your portfolio will be limit down twice so again I'm not trying to dismiss the probability or dismiss the you know the risk of a technical default but I do want everyone to understand that the risk is not to the T bills that get defaulted on the risk is to the global financial markets that could be limited down because the US the the base layer of money and collateral in the Global Financial system stop making its payments on time that is a much bigger risk I want everyone to understand that and that is why Janet Yellen has been coming out and talking about catastrophe every single day and we'll continue to do so until the folks in Washington get tonight done can I end on on one on one you know Public Service Announcement yeah you know I always try to you know kind of obviously we can talk finance and analytics all the time but I think behavioral this is the part of the game where the behavioral side is really important when we talk bearishly and say hey recession is going to be here in Q4 q1 of next year and you know you gotta you know be worried about you know big significant drawdown in the equity and digital asset markets and those things of nature we're not trying to get you to run out and sell things or short things well we're primarily trying to do is to stop you from buying things towards or near the high because the most hazardous thing that can happen to your wealth is buying something right before it goes down 20 30 40 or 50 percent that's called volatility drag you might recover substantially from that that those lows but you will never compound the kinds of returns you could have compounded in the subsequent you know Market cycle if you had just been more prudent with you know the time with the time with which you uh kind of got all in in the market so I'm just trying to make sure people don't go all in at the wrong time don't get sucked into it and it's often um you know individual investors and those of us who are trying to grow our nest eggs fun guys do it too exactly Darius fantastic stuff today so appreciate you thank you I think it's a really you know people tend to think um well stocks and bonds can't be right so someone's right but you know this is a really good cautionary note that we could be in for a tricky time where you can get caught caught out as we make this transition because timing is everything so thank you for that of course thank you Maggie always a pleasure to be here in love with the real Vision audience you guys are doing great work yeah thank you so much and great great questions today I say that a lot but honestly you are the smartest audience in the universe uh we'll be back same time tomorrow Ralph's gonna be here with me for an AMA it's extended we're going to switch the extended from Friday to Thursday so we can squeeze in as many questions as possible and Darris is going to have a session with Rob coming up in a couple weeks as well there may or may not be beverages I'm not sure we're working on that but uh we have some ideas but um but yeah definitely tune in tomorrow and come armed with your questions good be a lot of fun we'll see you then in the meantime as always take care and good luck out there [Music]

Channel: Real Vision

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Keywords: real vision finance, real vision tv, chinese, stocks, bitcoin, equity, equities, nasdaq, consumer sentiment, consumer prices, inflation, chinese tech, chinese tech stocks, china's tech crackdown, fed, federal reserve, the fed, taper, fed tapering, fed hikes, rate hikes, interest rates, bonds, treasuries, investing in bonds, raoul pal, 2023 markets, 2023 recession, 2023 inflation, realvision, ral pal, raoulpal, portfolio management, gold, tony greer, tg macro, beer with tony greer

Id: e5l6UABGdMc

Length: 33min 52sec (2032 seconds)

Published: Wed May 17 2023