Raoul pal - Here’s the recent calls: 2015-2016 - spx short. = failed Oil short, few times since 2016 = failed. Bond yields, TLT short = failed. Channel is great. Love some of the interviews but let’s talk about these?? For the record, put zero to work based on those calls. So, not a bitter subscriber. Actually an happy one. But ur thesis isn’t up to today’s environment. Far from it. Emailed you about them and got no answer.

Great video, agree with almost everything here! One of the only things that makes me hesitate from going net short in this market is the following: if we get into a substantial correction scenario, what stops the FED from turning QE back on in order to bring everything back? This bull market seems to have been mainly QE fueled, why does that stop now?

Didn't expect so much charting BS tbh. Fundamentals drive these charts, not the other way round.

Raoul - With the recent break in multi-year downtrend in the 10yr and 30yr UST rates broken, has your thinking changed now?

It seems to me that all of this is dependent on Fed not changing course in 2019 RE QT and rate rises - a risk for sure, but not a high risk if events start running away. Now that the T10 yield has broken to the upside of the wedge, do you think that the risks of your scenario playing out are reduced Raoul? And how much could supply fundamentals in Crude and copper drive the price over and above the macro story?

I have this opinion that DXY will drop once again to around 82 and then resume the uptrend in earnest after consolidating for 1-2 years.

I fancy this video has now become very relevant given the strong deflationary ‘kick-off’ that’s happening in October and from October onwards.

Thanks for the MACRO update Raoul. Checking in w/ you on the TLT play...Can you advise back with an update since the video aired...thanks much

A tour de force that makes its case convincingly. But if it plays out this way, helicopter money will soon follow, so I'd be looking to sell those TLT calls and redeploy the proceeds into hard assets.

Outstanding! Great Job.

Thanks Raul, I have added a TLT & GE (eurodollar) call for 2020. It's worth a try as things are accelerating. I took your advice on Bitcoin in 2015 and that was life changing for me. Hope this one will play in simular way. Jeffrey Snider is also pointing to 29th May which shows spike in leading "ED instruments" and follow through in currencies, copper, gold . That could be eurodollar event no. 4 and what we see is already liquidity event unfolding before our eyes. Definitely worth few percent of capital. Thanks you for sharing your views and hard work. You make a difference //Artur

Excellent video, Thanks Raoul, It would be great if you made a followup video focused the technical side of your trade recommendation. What dates did you buy the TLT calls, at what strikes and why? It it a strictly Vol. based trade, are you using straddles? how do you manage the trade on a weekly basis, are the call covered ect.. Thanks, Ryan

Why did this site go down market and become like zerohedge?

Jeffery Gundlach CEO of Double Line and bond supremo has a different view. He says you can predict the yield of US 10s by averaging the US Nom GDP % and German Bunds. So he is saying US 10s will go to 6%. He estimates 100bps per year rise out to 500bps. I’m more inclined to go with Jeffery than Raoul’s crude squiggly lines!!

Raoul, thank you for the great talk. In your opinion what would happen to Gold and Silver under the deflationary, weak commodities cycle? And how long do you think the condition would last? Thanks John

Always love the analysis. I’ve been unable to buy TLT in the UK via the brokers I use. I’ve opted for IDTL which looks like ishares equivalent - unless I’m sorely mistaken!

If you were buying calls on TLT what timeframe would you look at? Short term and roll them or longer term?

Let's be honest, it's the main reason we subscribe to RV. Great work as usual Raoul, thanks.

...to be viewed within the context of an on-the-ground weaking of the dollar. Purchasing power of USD is being eroded, and despite official stats of lower inflation, people feeling consistently poorer

Hi love it as always but I am a bit concerned that some of the charts are made to suit your view which as you say started years ago (on this RTV journey) and you say that when the charts change you will change, but then in comments below you say that you change some of the charts to suit also. Well, I do my own charts on US10 and 2yr and they are both clearly breaking out of the down channel you refer to, if you go back to 1986. I just think if the chart is your starting point (with which I agree) then you should stick to your mandate so to speak rather than shorten some chart durations vs the some of your key assumptions like USD breaks.... I think you are also in danger of over curating your guests to predominantly USD bulls as we broke the 95.35-45 level. Now its looking like a fake breakout and the weekly opening up for a move to 90, with the 200 WMA failing? The long term downtrend would then still be intact...

Thanks Raoul for all your efforts!! How about an update post Jackson Hole??? Crisis abound??? Fyi, prices are real and they're still rising in August, or any other time of the year. This Stock market is where money is being made. To make more suggestions that crisis is nigh after what we've witnessed in a market dependent on monetary stimulus, BS tweets, BS accomplishments (i.e. NOK) that turn out to be lies etc....I'd say we have an incredibly resilient bull market showing no signs of weakness "AT ALL"! How about acknowledging the fact this market now known as a casino to many is making money for its participants and it's unreal, surreal, unprecedented and insane, making it almost impossible to predict what happens next. With all due respect, anyone who says or tries to predict some sort of a major move lower in asset markets (mainly equities but you know what I mean) sounds like, smells like and looks like complete BS and a waste of subscriber time, fees and confidence in the platform. IMHAO, it's wiser to wait for the move to be a proven break with conviction along with evidence of sentiment change and then talk all you want to help us make some money in the opposite direction. If anyone still remains excited to get bearish after listening to this or any other BS is nothing but a fool and still subject to the bear trap narrative. It's getting harder and harder to WANT to renew RV's subscription despite how much success RV has had(still love it but....). Makes me sad and disappointed that the beautiful, exciting, opportunistic and lucrative markets we once knew are now nothing more than a sham. Cheers to all but I'm pissed!! :) Sincerely, Vinnie

Time to have ECRI back.....

Oops - not “lower” but “mild” inflation.

One final thought: who is to say we have deflation vs. inflation?! We could have just inflation in pockets and general deflation everywhere else in global economy. To me, rising US markets need tp be

...society. Who cares what manipulated markets are doing when everyday people are massively struggling (at least in US).

5. US already in recession most likely - weird tale of two societies - those at the top and everyone else. V. high income and general wealth / health / wellbeing inequality which is ripping apart sofi

3. ...sufficient justification and rigorous analysis. 4. Agree with cautious 10-year long bond call position - pretty wise, but that does NOT necessarily suggest deflation.

2. ...stagflation is a real possibility - see Luke Gromen and Eric Peters’ brilliant work. Both do v. interesting and thoughtful analysis. 3. Many charts and conclusions presented without suffociemt

1. ...brave new world of central bank liquidity and, one could argue, manipulation (obvious and subtle). 2. Why can’t we be in a stagflationary situation vs. deflationary situation. Seems to me that

Highly respect Raoul’s work and his thinking, but this analysis seemed to be less clear and rigorous than his usual presentations: 1. Charts are not always telling us something. We are in a...

only problem i see is you will keep saying long bonds until you're wrong, which means you will be wrong eventually

Australian ten year notes. I agree with Raoul, and I think the better places to express this is in Australian Ten year notes, Aud, and Australian Banks. From a trend perspective, I like to use, 21, 51 200 and 400 daily, and 5 21 and 51 weekly. The Australian bonds are long 7/7 on a trend perspective and a potential breakout on the daily chart at 97.40 taking the hi in august 2016 to the next hi close. The AUD is also short 7/7 on a trend perspective, with a trend break at 7640. Australian Banks, CBA and Westpac are short 7/7. This picture is a perfect expression with the seriously short bond market, as per COT. Australia's is set up for the perfect storm.. slowing China, deflation correction or crash Banking Royal Commission. Trade with the trend friends and short $AUD, long AUS 10 year bonds, and short Australian Banks,

whats the case for a dollar rally? Fed came across very dovish today (24/Aug/18) -i appreciate the thesis is long term. Also what about the 3D's in the US? debt, deflation and demographics - none of which are bullish for the dollar?

Thank You Raoul. It's great to have a periodic overview from 30,000 feet. Often times on a daily or weekly basis, one gets caught up in the minutia, and lose perspective on the Big Picture. To have someone with your background give their overview of things is extremely helpful. Please continue to do these very helpful and timely segments.

Perhaps others will know this question and would appreciate if they can share it. Where do I get the data to construct the 10yr-2yr swap % or is there a website I can track this chart, if yes what's the website?

Raoul has some good points. Of course you never know what's going to happen and it's all about reacting not forecasting, but this is one interesting take on what might happen and what you should do in case it does happen. Only small thing is that I don't agree with is buying calls on TLT. If you want delta exposure on TLT, why not just buy TLT and maybe place a stop somewhere? The case with options is that you are also getting vega exposure and when you are buying calls, you assume that the market makers are pricing options wrong (otherwise it doesn't make sense to pay for higher bid ask spread + volatility premium vs. just buying TLT or T-bond futures). I don't mean to insult anyone, but there's about 0 percent change that anyone of us is better at pricing options than market makers and it is ridiculous to even try to argue anything else since it's a highly competitive game with very intelligent people and computers involved in it. Just play the macro and forget options (unless you for some reason want to structure it as a credit call spread which is almost vega neutral).

I have traded for 50 years and you featured me ‘Trader vic” .... i believe your correct in your call on bonds ,as growth in Europe, China ,japan ,and other emerging markets are slowing. I believe inflation will slow in the US headline number ,and the Fed’s rasing rates before the US election is suicide for Powell if something goes wrong , he’ll be castigated by Trump. September will not have an increase and growth will be slowing in the US . My issue and humble suggestion is if you read ‘Technical Analysis of stock trends” it has nothing to do with the Long term charts you show?? They are based on cyclical bull and bear mkts not 20 or 30 year pictures. Just a thought for you to ponder?!

As someone who was a professional bond trader, I think I should clear up a point that keeps on being brought up in these comments and which might mislead some non-professionals: that there are record short open positions in 10s and 30s. The COT report was disaggregated in 2009 into Asset Managers, Leveraged Funds, Other reportables and Non reportables. Asset managers are net at record LONGS, the reportables are a basic wash, while Leveraged Funds are at record shorts. Now, that applies to futures positions only. The cash component against those positions is unknown and unknowable. In a period of wide differences between yields in Europe and the US (the most liquid bonds) it would be natural for the Leveraged Funds to be running very large carry positions, which would need to be hedged with futures. This would explain the short in that category. Also remember that as bond issuance in all sectors increases (as there is more debt in the world, there are more bonds), it is perfectly natural for the size of the hedge to be larger and larger. This would mean that those positions are not "squeezable" unless the basis changes massively, which is very, very unlikely. And even then the net effect on the market might be minimal, unless there are massive credit events. This does not take away from the basic arguments that Raoul made about direction of markets, I just thought it important to clarify a potential source of misunderstanding by non-pros.

Markus B. knows his subject very well indeed. Excellent comments. I make my living owning and trading physical copper and other base metal companies as well as speculating in the juniors. It's fascinating following the differences in the terminal markets, miners and the scrap prices. Raoul's analysis may be correct in the short term but, 2019-2022 we will be in deficit in the red metal. Even high quality new mine finds (there aren't many) will need $3 copper to put a shovel in the ground. Of course, that material won't even be available for at least ten years due to the under investment that Markus correctly points out. Otherwise, there will be no EV revolution, batteries, etc..

I can never understand why the dollar would go higher with the federal deficit/debt set to continue increasing as far as the eye can see. When the recession comes, our elected representatives will go into fiscal stimulation mode again, as in 2008/9, and really blow the debt up. The huge increase in supply of treasuries has to result in a corresponding decrease in price. More QE will greatly increase the dollar supply. In this scenario, why would the value of the dollar rise?

Raoul, some food for thought regarding copper and other industrial metals. I have no reason to dispute your short/mid term view. However, there is a notable discrepancy currently between industrial metals where the price fixing is determined on spot markets (i.e. copper, zinc, nickel) and other industrial metals where prices are agreed on a contractual basis (i.e. vanadium, chrome, steel rebar etc). The later point to continued robust demand. Regarding copper and base metals: stepping back a little there is a very important trend to observe. Until 2011/12 the biggest investment cycle in the mining industry took place and contributed to temporary oversupply and a price decline. Note that the investment volume collapsed since 2011 and there is very little sign of a recovery. The knock on effect will be that the world in all likelihood will face a shortage of supply in most raw materials over the next decade or two (unless demand is going to crater which all things considered is possible but not highly probable). You already see structural deficits emerging in multiple raw materials (copper deficit in 2018 is expected to be 2 % of global supply). In the current uncertain climate NO mining company will consider significant further expansion and it is in particular visible in the copper market. The development pipeline is dry for years to come. At some point fundamental factors will start to play a bigger role and these do not indicate copper at new lows. One should keep an open mind to a scenario where actually the opposite could happen and we will not see new lows rather than fast accelerating prices to the up. Just food for thought.

"Copper new all time lows" - not sure anyone left to produce at those prices in 2018

The Mauldin for Millennialls

Great piece Raoul. How do you see the JPY performing against the USD short, medium, and long term? Thanks. Carlo S.

Raoul, does the pension crisis, although still down the road, partially explain for the outperformance of big tech which has helped pull the SPY higher? Are pension fund managers so desperate to close the gap between demands and returns that they feel forced to keep chasing Amazon and friends higher?

While I like the video, I could not disagree more. In order for a deflation scenario to play out, you are effectively betting on politicians and central bankers to show constraint when signs starts to appear. All evidence over the last 10 years point to the contrary..

Basic question...how do you purchase option contracts in the uk i.e. what platform/company can you use. New to options...

Before anyone else asks! Gold is not of macro interest to me right now. Im not long or short, so any views of gold would be without conviction so of little value... sorry gang.

Request: I agree Gold is probably lower then higher. Can you do a global macro analysis on Gold? Not interested in prediction as much as in logic, reasoning and framework for the Gold market. Thx

Superb Raoul Pal. Class.

Superb Raoul Pal. Class.

Hi, As always Raoul doesn't disappoint - it's a great piece. However, I'm sure many viewers would appreciate his take on another commodity/currency, i.e., gold. Given his deflationary bust outlook what's his take on the precious metals? Cheers and keep up the good work. Matthew

Sorry, just don't believe technicals are good predictors of future price.

Raoul eloquently lays out the deflationary bear thesis in a way I've been hearing for at least 3 years, though he does it far better than most. Very convincing on the surface. I don't buy it, though. It greatly underestimates the "inflation at any cost" mindset of central planners as well as the impact of a continued populist political shift. Nothing is more inflationary than populist governments.

Raoul eloquently lays out the deflationary bear thesis in a way I've been hearing for at least 3 years, though he does it far better than most. Very convincing on the surface. I don't buy it, though. It greatly underestimates the "inflation at any cost" mindset of central planners as well as the impact of a continued populist political shift. Nothing is more inflationary than populist governments.

Hi Raoul, excellent presentation. how does your deflationist view tallies with your bullish view on India. do you pair a short MXEF Long MXIN, or do you get out of the Indian theme for the time being.

I'm leaning towards the point of view expressed here, it's just I don't really accept the idea that the way to play this is going long ten year ust's or TLT. I may be in he majority, but I see limited upside there; I also see many other ways of expressing a strong USD/deflationary outlook. I'd rather just short commodities, short EM currencies, and keep most of my cash savings in dollars.

Does oil is breaking much lower (and staying there for quite some time) balance out the Uranium super cycle narrative?

IMO this is a 2019 story.

Long TLT. Done. 🙏😉

Convincing video, as is always the case with Rao and other perma bears but he's been bearish for at least 3-4 years now. "Big picture" framework continues to get bigger. One day, bears will be right.

Excellent analysis and commentary. On your availability would like your take on gold if this macro picture firms up. Thank you in advance.

Great commentary. Looking at the big charts and developing a hypothesis to explain the evolving charts is really the right way to do macro. Too many try to predict the future which is just not possible on a consistent basis. Missed one asset, Gold. Can gold rise if your strong dollar hypothesis is correct? Gold is tied more to real interest rates over the long term. These days it seems to be slave to the USD and specially the USD-JPY and USD-CNY cross. Would love a global macro chart analysis of Gold.

another great video. here is my question. you seem to be very concerned about the amount of folks who have shorted the bond market, but do not seem concerned about how many folks are long the dollar. why is that?

Hi, I was wondering why you prefer to use linear instead of semi-log graphs when showing very long series of data. Thanks. Mitch

Well put together, but i'm not sure a lot of those chart patterns work on such a large timescale. I definitely agree with the sentiment of deflation and "watch the dollar" though.

Raoul, great stuff. May I ask a question, is it monthly charts that you are showing?...……….tia

As always - fantastic - thanks Raoul!!!!!!!!!

I will work for Raoul Pal for free, anything you'd like ill buy a plane ticket to Spain no questions asked. This analysis is clean and so easy to understand thank you! The British accent also makes the information sound a lot more poetic its captivating.

Finally, some real stuff. Thanks Raoul.

Raoul this is why I subscribe to Real vision!! Excellent analysis!!

Interesting stuff, thanks! I believe it ties pretty well in with Brent Johnsons "Dollar Milkshake Theory" that he talked about in his last video? Liquidity will find its way to US financial markets and strengthen Dollar/Bonds/Equity and almost everything else will weaken..

Thank you Raoul! I love that you are not afraid to call it the way you see it. Considering the risk of a deflationary bust, it doesn’t hurt to take an umbrella along when there is a thirty percent chance of rain. I like your suggestion to buy inexpensive calls now. They will be expensive later, if interest rates fall as theorized. Short term I think the USD is about to correct but longer term a stronger USD is very possible and problematic for everyone. Making fewer USD available to the world is the definition of deflationary. I don’t understand why a reserve currency would do that. I also love my RVTV!

It will take a recession to cause deflation. I assume the federal budget deficit would swell to $2 million plus. I have a difficult time seeing deflation with this budget deficit. There will be deflation in the stock market as stock buy backs will prove to be a bad investment. How will interest rates go down if the government needs to finance this deficit? The Fed controls the short end of the curve.

Raoul, where have you discussed Spanish banks before?

Story teller of the year!!

Unless I go long TNT ETF don’t know how I grow retirement portfolio. Thanks RVTV. Money well spent.

Amazing how logical & simple Raoul makes it seem. That's why there's only one Raoul Pal. And we are most fortunate to be privy to his commentary.

Continually impressed with your keen insights Raoul.

$USD finished lower 5 days in a row...reversing the recent surge higher. Could the Dollar have topped? Time will tell, however, I think it is more of a possibility than many market participants anticipate, as nearly everything, including interest rate differentials, and a risk-off trade, has been in the Dollar's favor, yet the $USD is still below its 2015-2017 highs.

make this video public!

Looking good Raoul - sun did you well. Honest comment, just looking healthy.

love these Raoul

Just Great!

Good analysis. I don't agree with all Raouls views. But his view on a major short squeeze for treasuries/bonds looks spot on. I reckon we see the same thing for gold, as well. Markets have a habit of doing what the majority don't expect...EM's could also rally and Chinese currency could stabilise if we see a trade deal before US mid-terms. A possibility as Trump would want some more brownie points going into the elections for Republicans. China also wants to relieve some pressure from its currency/ stock market/economy. Massive short squeeze coming world-wide for everything, IMO.

Straight talk, for a make believe economy.

I don't agree with some of what Raoul says in the video, but that is neither here nor there. My timings might be different. I might have more of an insight into why we do not have anywhere near record shorts in the bond market. None of that negates his primary argument. But his overall advice is very sound: buy calls in TLT. As he rightly says, it will hedge you. Your portfolio will not suffer and you will sleep much more soundly! At this level of vol it is almost stupid not to.

love the charts Raoul. don't you think that the rise of China an industrial might with population of 1.5 billion and a massive infrastructure over capacity and their alliance with Russia with territory twice that of United states with most of world natural resources, add to that the Muslim world of 2 billion in desperate need for development that is gravitating toward China. put that together and you get a formidable alliance alters the comfortable narrative of the past 70 years dominated by the west and all equations: equities, bonds, currencies commodities.....a whole new world order forming right in front our eyes as you recently tweeted !?

Mr Pal, how do you see Gold playing out within the macro framework? How about parking cash in short term T-bills to take advantage of rising rates, but to stay nimble, thus having cash available? Excellent presentation!

I have watched both William White interviews on RV and additional ones outside of RV noting his general macro and "big picture" worries. Raoul's presentation also covers potential triggers for a "truly toxic phase" within the next year or two. I wonder if anyone has analysis of Dr Tim Morgan's predictions drawn from his SEEDS model predicated on the Energy Cost of Energy. His use of "prosperity" measures seems to accord with William White's preference of an OECD "well-being" metric. In his recent pieces Tim asserts "SEEDS puts scope for value destruction today at over $400tn, which should be treated as a (very approximate) order of magnitude of the extent to which asset values have to fall." None of the commenters on his site argue against his calculations and some refine his estimate of global debt to just short of $300 trillion by 2020. https://surplusenergyeconomics.wordpress.com/ It would be great if RV interviewed Morgan and engaged with his calculations but, failing that, any pointer to counter-arguments would be much appreciated.

A head and shoulders top pattern... oh my, please god, no!

Good stuff as always Raoul!

the arguments that inversion = 12-18 months before recession may be very wrong this time as the US and the globe is starting from the weakest starting points. US GDP is half of last cycle, debt is massive, consumer savings is limited, consumer is tapped out on credit, real rates already negative nearly everywhere in major markets, currencies are in chaos and so much more. Our best housing starts data in 2018 is at levels since 1960 where we were going into/out of recessions. Exactly what cushion is there for the US or the globe to last 18 months this time? I would like to know. Other recessions were generally event driven from something within the US. This time it looks global, with the same weakness everywhere.

IEF 7-10 bond etf.. have watched options most of 2018 never more than a few 100 open interest. There are some very large bets being made Sept. through Jan. 2019

Wonder if a little volatility is near. Cohen in big trouble. If election starts leaning to a Democratic win in house . Trump has started trying to run Powell. Does Powell raises rates. Does Trump really go nuts, that the Fed is his enemy. These things could shake world confidence???

Thank you for subtitles!