End of the Cycle?

Published on
April 26th, 2019
Duration
15 minutes

End of the Cycle?

Trade Ideas ·
Featuring Kevin Smith

Published on: April 26th, 2019 • Duration: 15 minutes

Kevin Smith, founder & CIO of Crescat Capital, joins Real Vision for his first Trade Ideas interview to discuss his bearish bet on the stock market. He reviews a variety of valuation metrics, highlights the flashing red signals from his macro indicators, and discusses how to make the trade, in this interview with Jake Merl. Filmed on April 24, 2019.

Comments

Transcript

  • AC
    Andrew C.
    29 April 2019 @ 01:40
    Can somebody please explain why the length of this business cycle is brought to support the bear case so often? Do they remember the GFC and how big it was? Has anybody normalised business cycle length versus the size of the recession that was had? Normalising these, I would imagine we still have 4 or 5 years of this bull market to go. The GFC was bloody big. The central banks don't want anything like that again and will do anything, absolutely anything, to avoid it. Four or five year more; let's go....
  • KA
    Konstantine A.
    28 April 2019 @ 06:08
    This is called catching falling knifes :) Good analysis though
  • BN
    Barrett N.
    27 April 2019 @ 04:23
    Excellent Analysis & Interview. Excellent insight. Curious, w corporate debt levels approaching 50% below Inv Grade in iRussell 2000, why Short S&P & not the same PUTs/short on the IWM? Balance sheets are worse. Will have to Suspend Buybacks & Dividend /cuts to shore balance sheet. Credit Rating Downgrades. Forced bond sales from insurance, Mutual Co’s that can’t hold newly ranked credit rated bonds. etc. Enjoyed interview.
  • MM
    MC M.
    26 April 2019 @ 19:58
    Good analysis overall here. Thanks. I've been through 3 major market crashes and have to ask Real Vision to interview a few bulls to offset our overall pessimism. The up market can go up longer than logical and longer than our shorts can last. Where is the money coming from that pushes the market up seemingly every week? Presenting both perspectives helps me balance my strategies.
    • JH
      JP H.
      27 April 2019 @ 00:00
      Almost all of the financial media outlets have a bullish bias and so do the guests they feature. The dominant sentiment in financial markets today is historically bullish. Where is the money coming that pushes the market up? Buybacks, fund managers seeing inflows who have to invest, retail investors. It is still very bullish out there and the only bears left are the ones featured on this site.
    • TJ
      Terry J.
      28 April 2019 @ 13:16
      I agree with JP H, and also suggest that if you haven't already seen it to watch the excellent Real Vision discussion Brian Reynolds and Tyler Neville had a few weeks ago, which gives persuasive reasons why the melt up powered by buybacks could go on some time (Brian suggested possibly as much as three years) yet!
  • DS
    David S.
    26 April 2019 @ 18:41
    Excellent analysis. I agree and have agreed for a long time; yet we are triple topping. It was easy to make the same case for years. Why is it so different this time - above my paygrade? Portfolios can be easily hedged, the options market is huge, corporations are buying up their stock reducing supply, the 1% have so much money to invest but limited profitable opportunities, global trade wars, the internet allows consumers to drive down prices, potential for MMT, sovereign wealth funds, tons of loan potential in banks from QE - the beat goes on. I am not saying that everything will not hit the fan but being wrong for two years is being wrong for two years. Mr. Smith is smart, well educated and articulate. Let’s focus on why the timing is different so far and invite Mr. Smith back. DLS
    • WY
      Will Y.
      26 April 2019 @ 23:54
      I agree.
    • MB
      Michael B.
      27 April 2019 @ 04:34
      I agree too.
  • RL
    Ricardo L.
    26 April 2019 @ 17:48
    This is exactly the same presentation from Mr Costa
    • WM
      William M.
      27 April 2019 @ 09:37
      They both work at Crescat Capital.
  • MM
    M. M.
    26 April 2019 @ 15:39
    Shorter term looks somewhat bullish though.
  • CH
    Colin H.
    26 April 2019 @ 15:29
    Bold
    • WM
      William M.
      27 April 2019 @ 09:38
      He has been saying it for a couple of years though.
  • MG
    Miguel G.
    26 April 2019 @ 13:55
    Nice job Kevin I love your firms work. I cropped out your charts and added them to my macro journal. Really enjoyed this video as it was super informative.
    • LR
      Luiz R.
      26 April 2019 @ 17:12
      Miguel, what software do you use or recommend for creating a journal? Evernote?
  • RI
    R I.
    26 April 2019 @ 12:47
    Catalyst = market overvalued. Last I checked, valuation has never been a catalyst. Still generally agree with the broad theme that the market is topping, and likely taking the form of a traditional broadening top pattern like a drunk wandering around aimlessly.
  • GC
    George C.
    26 April 2019 @ 12:10
    Superb entry onto the Real Vision stage. Will be interesting to see if Kevin's thesis plays out. He's confident!
  • GR
    George R.
    26 April 2019 @ 11:57
    Great interview. Lots of excellent supporting charts to explain the thesis! Encore.
  • gg
    georgy g.
    26 April 2019 @ 09:27
    Love Kevin, pls bring him back for the full feature interview