Comments
Transcript
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LBcouldn't we take into account the possibility that many corporations around the world will be able to basically roll the debt down the line given the huge amount of liquidity? if we consider rates going into negative territory, HY looks attractive even at ridiculous levels in RV, and despite a sluggish economic outlook that could suffice to just kick the can down the road few more quarters (basically a EU and JP scenario goin global)....that would eat away even more equity fundamentals, but still protracting this neverending cycle of Achilles (GDP Growth) and Tortoise (global Debt)
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GSGold down, EUR up, AUD up, BTC back to under 10k, Bond yields rising, stocks up...I mean is there anything that has actually worked out the way macro people said it would?
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PhRaoul. Im not a economist but do understand that we are heading for a world of hurt and RV is helping. Watched this vid again for the god knows how many times cos it pushes it into head the more times look at. When you say 25% in trading opportunities, what are these, Bonds, equities(which you don't do you've said, currency? Im currently long of gold, crypto and very short, watching the markets regularly to step out as soon as. Thank you. Paul Harvey
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RDExcellent video Raoul. Any ideas on why the euro has been rising steadily for the last few weeks against the dollar?
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WBSo much for the EUR "breaking down before our eyes." While I agree with the fundamental analysis and am in the long term trade, the three episodes this year with the EUR staging massive rallies against the dollar undermine the thesis. This market behavior does not suggest a dollar shortage.
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MPIf Crypto's like Bitcoin become truely valuable why wouldn't any government issue their own crypto's? I would imagine that a Government Backed Crypto is more valuable than a non-government backed crypto. That is why i don't believe in crypto's like bitcoin. They can become zero overnight if the U.S. government came out with a crypto they backed that was their very own.
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SWUS will not give up reserve currency without war.
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RERaoul, I think your analysis is unique, and very much correct. Most people still do not realize the dire circumstances we are in globally. A global financial nuclear bomb has been unleashed, what will be left after everything has been flattened. Gold, silver, Bitcoin, and a few other cryptocurrencies or platforms. Ethereum being a platform, but ethereum is very important in the scheme of government and corporations using it as a platform. The news is there for others, if they just look for it. We are going to a crypto world, and regardless of entities developing national currencies in crypto, they are centralized. Bitcoin is not centralized, it is decentralized. It cannot be hacked, attacked, or taken, you cannot make more, so it is scarce. In some ways it is more secure than gold, more fungible than gold, more transportable. There will be many who will disagree, fight over, be vehemently against crypto. To those, you will you lose, perhaps everything. Just look at where Bitcoin was in 2013 and where it is today. Nobody in their right mind cannot say they wish they had the hindsight to buy it at $10.00. What will you do when Bitcoin hits $300K on this next bull run upcoming. Will you watch and wait for the crash to say I told you so? Or will you benefit? $300K by end of 2021/early 2022. And guess what , it will crash again, to perhaps $50K-$80K. Will you say you still don't want Bitcoin at $50K? Will you still say it is a ponzi? Raoul's analysis cannot be more prescient. September and the fall will be brutal.
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JGRaoul stated he believes we are approaching the end of the hope phase of the bear market correction we are seeing. Besides a lot of gloom, which is accurate IMO, I would have liked to hear what could happen when the FED/Treasury (now one) print 10T to elevate asset prices as they like to do. Couldn't that extend the hope phase significantly?
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TCI think that for those considering precious metals stocks it will be important to consider where that company's assets are located - in what jurisdiction. I can fully see governments "nationalising/stealing" mines and assets, or setting "official gold price in their currency". Rule of law and ideology of the government will be very important in considering the risk exposure of particular companies (even the big boys like Barrick or Newmont).
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RKI’ve recently bought my first bitcoin thru Coinbase. Should I be using a different system? What did Raoul say... “Legend LNQ”?
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GS90% of positions Ive seen is either really hopefull or really bad as Raouls case. I'm more in the camp of a long shitty grind for 20/21. The other thing, I'm not American, but when I go through every economy right now, I cannot find any economy with more powerhouses than the US. When the pickings are slim, which economy is going to challenge the US? the EU? Japan? China? it aint Brazil, Argentina or India..
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DMI saw the Pomp podcast and now think you're the smartest person in the room. I see the clarity and probability of the € falling further faster against the $ but whilst based in the UK I don't know how to take a position on it (save spreadbetting)? Also by your reckoning does deflation US mean inflation UK et al?
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CHRaoul, Your analysis is spot on in that the financial system of the world was doomed well before the corona (CCP) virus emerged. The only question I have is that as a long time Real Vision viewer, your enthusiasm for crypto currencies is surprising. I remember your report from a year or to ago where you debunked crypto and said that you were not convinced. My opinion is that cryto is the largest ponzi scheme I have ever seen. When a dollar of crypto can be raised to be worth a thousand dollars because of the influx of sheep to the slaughter is mind boggling. My belief is that crypto has become the crime lords' best form of money laundering in history. Regards, Craig Harris
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PGApparently, I watched it too often and my "quota has been exceeded"!
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CGJust finished watching for the third time. I discover something new every time.
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CNHow and where do people hold USD? given the possibility of bank insolvencies and bail in's. Would people consider a crypto stable coin as a viable option to hold USD? thank you in advance
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RJThank you Raoul for touching on Australia. Also know as "Utopia".
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MB🤯👌
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PWIf I understood you correctly, Raoul, you say you're roughly 25% in gold, 25% in BTC, 25% in cash and 25% in special situations, mostly equities. You also expect US sovereign bond rates to go negative. So why no dollar bond holdings? I thought you'd be filling your boots for a quick capital gain.
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PEWow! I'm glad I joined Real Vision...this analysis is real vision! Thanks.
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jgThe one thing I think Raoul did not cover is central banks buying stocks as Japan has done. This I think will happen in his likely scenario. What is the impact?
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WSRegarding the thesis of MASSIVE USD appreciation (EUR ==> $0.8, JPY --> 250) my question is: why would the US allow that to happen? Currently, the administration seems to believe that a much stronger dollar from here is not in the US's best interests. They can easily devalue the dollar by printing more and buying FX. So why wouldn't they do this if USD starts to go on a rampage?
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ABThanks for the update Raoul! One big factor to include in this is that ALL those who are unemployed are now making USD 1000/week from unemplyment checks. For all of them they this is more money than their regular job. We also know that most of the people tht have lost jobs have been the lowest paid workers. So in effect, people who were paid well continued to do job from home and those who could not work from home are making as much if not more money. So people are not cutting back on their starbucks coffee, nike shoes , etc. Almost everywhere you go in USA, there are lines to get in COSTO, SAMS club, Home depot, etc. I am trying to get a fence at home home and the company cant even come dto do evaluation for 1 week, because they are so busy! Similarly, for resturants, they are running out of parking spots because pople are lining up in cars for takeout. So, how will this lead to insolvency? That is the issue I seem to be struggling with. Additionally, I do not see any way that the unemployemnt benefits will be lowered or discontinued. No way in an election year.
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TBWhen ? Yen to 250 in what time frame Raoul ? 18 months or 6 years ? Not possible to answer obviously, but if you're set-up for it already as you say with cash/gold/bitcoin..... you must be expecting a big crack soon.
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MBExcellent as always Raoul, but being in crypto since 2015 and made lots of profit in 2017(bought gold and realestate from it and traveled a lot, basically exited 90% in late 2017) and being an developer at core(since 1999) I can say BTC has an achillees heel. Its the blocksize. If usage goes up so will the fees and congestions. Yes there is Liquid(its not BTC, it's custodial at best) yes there's lightning(it has bad flaws, plus you need on chain tx's capacity as well, and it's again not BTC) so all the "solutions" are not solutions. Satoshi allowed the 1MB block limit as a temporary spam prevention at the early days, saying it needs to be raised when time comes. There have been large censoring actions against anyone who spoke up during the block size wars, I felt it on my skin as I voiced my concerns in the /r/bitcoin community. Blockstream controls most communication channels and has effectively strangled any voice of reason(to profit off of Liquid?). I'm not saying buy into this or that coin, just that do your due dilligence people: https://medium.com/@johnblocke/a-brief-and-incomplete-history-of-censorship-in-r-bitcoin-c85a290fe43 https://twitter.com/peterrizun (this guy explains nicely what's bad in Lightning and that BTC can scale with blocksize increase) Or google "satoshi 1mb limit" and you can see it was implemented not because it can't scale or something. With all that being said... I also own BTC(among others) hoping it will get fixed, but if absolutely everyone hops on BTC it's going to a screeching halt. I think in a way that some of the other altcoins could provide to be a kind of a "lightning" or "sidechain" to BTC if it persists to keep the limit. But equally it could be a deathtrap for your capital if you can't move it out when you need it. So not everything is peachy in BTC world. Again, I also hold BTC, but not 100%, and that simply from hopes that if SHTF again... we might get the block raised if everyone is aware of the reality that the limit is not good and has no reason to be there anymore, at least not in that "size". Would be great if we can see someone like Peter Rizun debate someone from BTC, so far nobody wants to debate him. Guess why?
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MGGive the long bond trade and how well it has performed, has an investment in US treasury bonds been better than the S&P 500 over some period? I’m not sure how to run that analysis myself.
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DBAny guidance on how to get started setting up the bond option bet on the 5yr yield going to near negative that is suggested in passing here?
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WJWhy gold might go higher if you forecast deflation? Gold is not a hedge in deflationary times.
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SBRaoul - you often mention the idea of a central bank + gov jubilee where the central bank buys the gov debt and forgives it (eg BoJ buying all JGBs then forgiving them). My question to you is what incentive would they have to do this? I don't think there is one. As it stands, the yield from QE assets is paid to the gov treasuries anyhow, so they are already effectively cancelled (and monetised too). Effectively you could even have a situation where Japan had 10000% debt to GDP and the BoJ held say 9900% QE assets to GDP. This would effectively look like 100% debt to GDP with a very large narrow money base. IMHO this is where we are already going.
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BMLove the dog in the background... the real new normal.
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SLRaoul intriguing & fantastic analysis... also you have a cool looking doggie! What other rule changes do you see beyond debt jubilees and massive massive USD printing that could dwarf other central bank money printing. Is it the IMF, world currency and SDR's to the rescue. Do we return to the gold standard? How are you expressing your Euro trade.
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CC@Raoul, I see the immense upside for bitcoin as a new asset class. Government actions to devalue their currencies makes me think that the probabilities of bitcoin breaking out increase. However, I have not heard of any discussion about government actions that could significantly diminish the upside of bitcoin. For example, is it feasible that all central banks and militaries could unite to outright ban bitcoin/crypto? Similar to how the US banned the ownership of gold, is it possible to do that but for crypto? I'm sure there could be other government actions out there that could diminish the value of bitcoin, but I just haven't heard of this possibility being discussed. Maybe it's because there's no possibility?
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CTSo would someone wanna tell me what the heck I should do with $250,000 in stable value funds sitting in a 401k with fadelity?? This is where I have been for 10 years when Obama got elected and thought this would happen then and didnt. Poor timing I know, but what now?
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LWRaoul Pal, just fantastic. Thanks.
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BPBless you Raoul.
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CCRaoul, thanks so much for making this available for all subscribers. It is incredible value and highly appreciated!
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KKHow do you suggest holding USD. Are MMFs OK?
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CDAnyone know where I can find the adjusted for inflation Gold chart Raoul shows (besides Bloomberg)?
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NJIndia and China central banks hold a lot of US$, wont they start to sell if they see their economies at risk? Also can this lead to de globalisation and countries going self sufficient .
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DCWatching this scares me....
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RCThank you Raoul! as always impressive insights
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JSI'm familiar with the Permanent Portfolio Fund...ie roughly ...25% cash, 25% gold, 25% equities, 25% bonds. Is there a fund that adds in Bitcoin to the mix?
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DWcan you buy call options on Bitcoin yet?
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MHFabulous! What can go wrong with your thesis? Clearly the Central Banks and the politicians know the risk and what's coming. What can they do to soften the blow or at least delay the inevitable? Thank you.
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ATThank you Raoul.. Very insightful. Right now, if i buy stocks, i only buy company with stable cash-flow generating power in current condition. For example internet provider company.
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RLRaoul, your light bulb moment regarding the differing liquidity value of money printing was jaw dropping. That one point of clarity brought so much value to the problem of currency valuation. I can't wait to see what the good fellows over at PIIE come up with once they start putting an econometric weight to that missing piece of the puzzle. I hope your idea gets in front of someone there. Or perhaps never mention it again - at least until we (your subscribers) have cleaned up in the currency markets....
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TSWhy a strong dollar relative to all the other currencies is bad in that next phase for all the others except USA. Can someone explain the logic.
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GKI try to stay away from hyperbole but this video was so full of useful and actionable information that I feel like it is the best video I have seen on Real Vision since the beginning of my membership years ago. The more of these the better.
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KLWhat do you think about the CHF, as it is quite strong vs all currencies. Will the CHF hold its value also in a deflationary period or will it be dragged down by the EUR? (SNB still buys a lot of EUR to keep the CHF down)
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SBFantastic video, Raoul! Thank you - I've learnt so much from Real Vision.
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PhRP. Your insights are great and suggestions will/need to be held in high regard. Paul Harvey
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TCWhat might be the best way to trade the negative bond yield scenario?
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RJRaoul, much appreciated. I, and I'd imagine others, would love to see a "Devil's Advocate" response piece to this episode presenting the most compelling counter-arguments to the high-conviction views stated. This would evidence unprecedented intellectual humility and allow us all to form further nuances of our frameworks/beliefs in this pivotal moment.
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BWGod bless you Raoul. Your insight will save so many people from this bloody recession. Thank you..
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SSThanks Raoul- amazing as always. What are your thoughts on gold stocks (not etfs but the miners) if gold explodes BUT equities in general correct? Does the market take gold stocks with it or are they relatively safe to remain in while this plays out? (I’m 25% gold and silver stocks, 25% physical, 25% bitcoin, 25% CAD - about to move that into USD after watching this!)
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BSGreat summary - starting to give Hedgeye a run for it in the macro space.
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PGFNV,NEW,GOLD,AEM,KL are the group of equities i chose to express my position in Gold. Looking at those companies they have a total market cap of about $130B hell that is about the market cap of BTC! Once people catch on to the performance of this sector all those equity restrained portfolios will lift these stocks. As one of the earlier poster highlighted, the performance of Homestakes & Dome during the depression was dramatic. I see it rhyming with the past or possibly repeating it ....
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KKGBTC allow accredited investors to invest in their BTC/ETH fund at NAV, but locked up for 6 months. Their OTC product for retail investors almost always trades at a premium to NAV during bull runs. Assuming long term bullish on BTC (holding period >1 year), isn't it best for accredited investors to invest at least a partial portion in GBTC at NAV to essentially harvest the premium over a 6 months period and later sell on the OTC market at a huge premium? Thanks for any feedback.
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DBRaoul— Some of my holdings are in levered ETFs (not ETNs), including TMF (TLTx3) and UGLD (GLDx3). I know they may be at risk of failing during an insolvency. But I'm thinking there would be time to get out if the market starts falling and switch to unlevered versions. Or am I wrong?
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ABAnd now the politicians are advocating a payment of $2000/Mo for every american "Untill employemnt is at pre covid elevels" . Ha ha ha. Please consider that whatever we thought was impossible in the past , has been done. Fed buying junk, free money to all, direct lending to main street, and bail out of hedge funds. So we cant dismiss Universal Basic income. What stocks do well and what stocks go bust in this senario? That is something we need to be prepared for. Looks like AMZN going to be winner in that situation?
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JHOpening this request to the community. I am anxious to learn more about investing in bitcoin. However, am leery of all the pitfalls, some of which are detailed below. Would appreciate any advice on the best resources to learn the ABCs of the process. Thanks.
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MSRaoul won’t bitcoin take a hit during the near term deflationary period?
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nwSouth Africa my friend. Born in Durban. Don't sweat it, SO many people have made the "South America" mistake. God Bless. You guys do amazing work and it's lovely to hear others who speak about these issues and understand it like I do.
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CB👌🏽 as always
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MRLegend !
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SSI’ve got probably 60% of my 401ks and IRAs in Treasuries at this point. Is this nuts? There aren’t always great options in these vehicles and it seemed like the best bet available?
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PDRaoul : at 23:02 you peg 10 yr. rates at .6% and inflation at -3%. That suggests a 3.3% real rate (not 2.4%).
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MJHi Raoul, you mentioned a negative bias towards cable, any specific levels you anticipate GBP/USD to hit, like you do for the EUR/USD? Was keeping cash mostly in GBP after Brexit, hoping for a return to 1.5..never really got there... now at 1.24, is it closer to 1.1 or 1.4...this is the question..
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JRGreat discussion, I love my real vision subscription. Where do you safely keep cash?
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EGblown away by the information itself but also how it is delivered . thank you!
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MFFantastic analysis, thanks Raoul. Regarding physical gold and no body having a claim on it, a president could technically sign an executive order to outlaw gold ownership. It’s happened before, unlikely but technically possible..
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JGIt’s videos like this that make the realvision subscription cost an absolute steal. Thank you Raoul, excited for the next few weeks’ content!
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ACHas me thinking about the petrodollar and the volatility in gulf state currencies as the USD increases.
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DSThe Fed can buy Ford's debt to get Ford out of a solvency problem. Likewise, for other US corporations that have a lot of US jobs and lobbyists. DLS
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BTHi Raoul, I understand the disadvantages of paper Gold vs. Physical but wondered what your views were on the recently launched Gold ETF by the Royal Mint (RMAU) ? Physically backed, allocated Gold held by the Royal Mint. An ETF that is redeemable on demand for cash or your physical gold with no Bank custodian risk. 22bps annual management fee. For those that are struggling to invest in the physical is this as safe an alternative as is available on the derivatives side? Many thanks
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RMSeems to me that if you need physical gold vs PHYS etf, you will have social anarchy and bigger problems.
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ENCan anyone chime in on how retail investors can invest in USD/EM currency trade pairs? The volume on futures contracts like BRL/USD and KRW/USD is tiny and both of my futures account brokers said they don’t allow trading. I set up a FX Account with Oanda, but the fees are pretty outrageous.
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JBHow reinforcing (degree of certainty of outcome) is the Core CPI crash today (biggest since records in 1961) to the overall concepts here?
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VMIn the UK, Rishi Sunak (the Chancellor) has just extended the furlough scheme until the end of October. There'd be a tsunami of redundancies at the end of June if they'd let it stop then. But shows how low they're thinking this will go on for. And it's only May.
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JMIn the event of an insolvency related SPX crash, why wouldn't gold & bitcoin also crash at the same time, as happened in March? Margin calls triggered by the crash will result in people having to liquidate their most liquid assets & that will include gold & bitcoin. Unless it is a slow grind down in stocks, I struggle to see a Short term scenario where the direction of the stock market, gold & bitcoin diverge.
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MCHey Raoul, Thanks for sharing. I admire your strong self control... Keeping 25% on the side... maybe you're simply waiting for that double bottom.... Great content mate.
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mithank you Raoul
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JTHi Raoul, do you think the S&P500 will ever retest the March lows?
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GMCould an even more brutal liquidity expansion, combined with an ulterior debt jubilee, be the "solution" central banks and governments are seeking? Would it be posssible without the complete nationalization ot the economies?
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ptThe Don!
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BTDear Raoul- thanks again!! Your perspective is always insightful and well considered!! Just a few easy questions for you to help the less advanced members of the 'vision'. 1. Is GBTC a reasonable way to track bitcoin- or too expensive relatively speaking? 2. Would you consider UUP when yields flash negative? OR just wait it out in cash? 3. Where can someone learn more about deflation-how to invest in such an environment? - it seems that ALL asset values including gold and btc, real estate, (?equities) may all lose value in such a world. 4. Do you agree that the current 'powers' will do 'whatever it takes' at least until the election in November?- Like change the Federal Reserve ACT- to allow MMT and Fed purchases rather than just loans to keep things moving? ONCE again, I truly appreciate your perspective and understanding of the financial world !!! A Hui Hou, BT
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WMExcellent follow up to previous narrative from Raoul. I like the consistent explanations and deepening of the thesis. More actual trade guidance to follow I hope. Great video and I am working toward approximating the recommendations on BTC this week (though going nowhere near 25% for BTC, I am close now to 25% gold metal / miners & 25% cash).
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TFRCA and other tech names lead the 1929 rally - did they also stay strong (like todays tech) during the big bear rally? When did they tip over?
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BNHow would you position yourself for the restructuring of the Euro as .8 on the dollar? Would you do this now or once certain signals are more obvious? (Q open to anyone on the section) Thanks!
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OHThe Unfolding: 8th April, market has been rallying for a fortnight since march 23rd - "we are in the liquidation phase now" What's Next: 11th May: "The Liquidation phase ended in March" Easy to be right with a road map when you predict things moving in both directions (down then up then down) and then rewrite history as to which leg we are in.
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MHI’m no longer in this camp, but brilliantly lucid and fantastically logical spin through markets. Makes me want to ponder again!
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NDRaoul, how do we interpret the T-Note and T-Bond futures open interest and options put OI and call OI, because we can get some idea or view on that what the bond market is thinking 3 months, 6 months, 1 year from now. Second, another way of looking at the "solvency event" you argue about, is to look at credit spreads (both US, Europe, EM) and may be the default swap market (and derivatives of CDS market) to understand how participants are pricing in "solvency event", if any. Because I don't have Bloomberg/Reuters, i myself is unable to look out for sophisticated interpretation of these curves out there. The idea is to look out for leading indicators in market pricing (which i believe is technically superior than charts and narratives)
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VGThanks very much Raoul and RV team! Very valuable. One thing I have noticed in the past and also in light when there are theories that BTC could be the next USD for the world, these two are competitors and hence I expect the BTC not to go up a lot while the USD is getting higher. Only when the USD tops BTC has the cards on the hand to fly higher.
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CBThank you Raoul
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BGRaoul, you really are an inspiration to me, thanks a lot for sharing your hard work. I have some questions about how to play this. 1. What 5y bond's price corresponds to a -2%? 2. Which expiration are you choosing for the options on the 5y bonds? 3. I trade options regularly on the stock market, but I don't follow the eurusd and 5y bond futures. Is it safe to play this scenarios with long term options, say 1-2 years to expiration? Or will the contango kill the trade if it happens too soon? 4. What underlying can I use to play the break in the usdcny with options? IB doesn't have options on usdcny if I'm not wrong
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DJFantastic!
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TMAlways a pleasure to listen to Raoul. Very smart guy and a nice person. Btw overlapping gold to trade weighted USD shows a cup and handle for gold as well (yet to breakout).
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KFCan anyone tell me more about the (option) bond trade Raoul is talking about? Thnx.
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KFInteresting again Raoul. Question: how to own physical gold? Can't put gold on a ledger :-) You still remain dependent on vaults somewhere in the world, how do you know for sure that nobody has a claim on it?