0:00

Do you remember the last time Jeff was on the show?

0:03

Guess. Like exactly what it was? No, just like around when. Oh,

0:07

we'll put it on camera. We'll put

0:09

it on camera. You gonna talk about it? Yeah, we'll talk about it. When do you think

0:11

he was on? Uh... Who you guess? I

0:14

don't know. I know you don't know. Guess.

0:16

Wait, why would I know? Aye, I'll tell

0:18

ya. What the **** are you gonna talk about? What do you want from me? It was

0:20

so long ago. Oh, alright, fine. You want me to

0:23

guess? It was... December. Yeah, 2022. I'm

0:26

back. Wait, what? Yeah. Really? Yeah, dude. We haven't

0:28

seen you since then? It's been a year and

0:30

a half. It doesn't feel like a year and

0:32

a half, does it? No. Time. It's

0:34

too fast. Wow. It's

0:37

not a constant, though. No, it's not. So

0:39

the title was The Game Has Changed. And

0:42

that was... Back then? That was the bottom. Yeah, that's

0:44

right there. That was the bottom. Do you feel like

0:46

time is speeding up as you get older? You're kidding

0:48

me? I mean, I feel like the

0:50

months are flying by. I don't think... So they're

0:52

close. I didn't even notice the

0:54

change anymore. I just took my son on

0:56

a... My youngest on the college tours, right?

0:59

Down south, I'm like, well, like, you kidding

1:01

me? See 11th grade? Yeah. Okay.

1:03

Come on. You're the last kid? Yeah. I

1:05

just... My first kid just got into... Got

1:07

into school. Nice. So we met last year.

1:09

Yeah. She's graduating

1:11

in a month. I don't know how. It's

1:15

ridiculous. Yeah. I agree.

1:17

So my kids are five and seven. And

1:20

seeing Josh's daughter go to school makes me

1:22

feel really weird. Because when

1:24

I met... When I started working with

1:27

Josh, she was six. Yeah.

1:29

She's a baby. Like, what

1:31

the f***? Great. And so it's

1:33

like freaking me out a little bit. Well,

1:36

the thing that somebody said to me, that's like

1:38

the most true thing I've ever heard is that

1:42

the days are long, but the years are short. Yeah,

1:44

right. So when they're little and you're

1:46

like on soccer fields and then baseball fields and

1:49

it feels like it's forever. Right.

1:51

Yeah. But then you realize, oh my God,

1:53

another year just went by. Totally. That's totally

1:55

true. Dude, Jeff, if you need anything, just

1:57

hear the noise. It's great. Yeah. It's great.

2:00

Exactly. And that's me for

2:02

the fact that we're for the barbie

2:04

you ever had. You

2:07

gotta get the engineers involved. That way it's

2:09

like a complete shit job. Just

2:12

derailed. Exactly. Ladies first and foremost,

2:14

I can't help. I'm good, thank you. I'm great, I'm

2:16

good. Maybe in a little bit. We just

2:19

had a lunch and we had

2:21

Santoli showed. Santoli's

2:27

great. He's great. He's off to... He's

2:30

one of the best. No, not the best. I say

2:32

he's the best. Jeff, no laptop today? The full...

2:35

I mean, I can put this up. Do you want to do

2:37

that? I mean, if it... Sure. Yeah.

2:40

If it hides my sweat marks... We'll talk

2:42

about this, but that was the top and rates, no?

2:52

When? Just recently? Yeah.

2:55

I'm in that camp. The chart doesn't tell

2:57

you that that's officially there, but I think

2:59

when you've got the chart on, I think

3:01

you're trying to make it look like something.

3:04

Yeah, I know. I'm... We

3:06

have more important things for that. Is

3:10

Peloton going to zero? No.

3:12

It's $2 stock. Are you

3:14

sure? No, I'm not sure. It'll get bought. I don't

3:16

know anything about that. I just don't know who buys

3:18

it. Yeah. Okay. Peloton

3:21

CEO Barry McCarthy steps down amidst the company's

3:23

restructuring, laying off $15 percent

3:25

of the global workforce, which is 400 employees.

3:30

He came in hot. Hold on. So

3:32

the stock spiked immediately following the announcement

3:34

because for most companies, layoffs are good,

3:36

not this one. Stock price

3:38

then dropped. This is the fifth round of

3:40

layoffs for Peloton since 2021 when it had

3:43

8,600 staffers. Yeah.

3:48

This was a $261... Was it $161 or a $261 stock? I

3:52

forgot. What was the high?

3:55

It couldn't have been a more perfect storm for that stock,

3:58

right? In both directions. Everybody's getting

4:00

fat like you know caps down 98% But

4:04

what what is what was the peak share price

4:06

because I'm a dollar guy. I know I know

4:08

Josh doesn't do percent He's right divided by 86

4:10

very traditionally. Yeah, the top was 167. It's not

4:12

under three bucks Is that bad dude that is

4:14

is bad and that was a meme stock for

4:17

a minute, right? So

4:23

Not really a ton Who

4:26

would buy this though like is there any value

4:28

nobody and there's not even a short squeeze Like

4:31

the shorts their shorts are going to cover at

4:33

zero were never covered So the last time I

4:35

looked which was a year ago, maybe

4:38

more they had They

4:40

had hundreds of millions of dollars and recurring

4:42

subscription revenue Like there's something there

4:44

because the machines they're losing if

4:47

you're losing money on the machines just to

4:49

get recurring revenue You could

4:51

do that and eventually catch up But

4:53

if the the sales of the machines

4:56

keeps falling then you install base that

4:58

you're modeling those recurring revenues for is shrinking too Well,

5:00

you know what? Maybe doesn't you can maybe a private

5:02

equity comes by two four pennies on the dollar and

5:05

clean I don't know what the debt is more importantly

5:07

what happens to my peloton It's

5:10

a regular bike now. I haven't ruined my peloton

5:12

I haven't a year, but you know what it

5:14

holds eight jackets. Exactly. I figured out It all

5:16

three jackets. It's not too long So

5:19

it's worth speaking of a question now. Did

5:21

you see these yet? What'd you

5:23

think? Pretty nice, right?

5:25

Not bad Nicole get a

5:27

shot get a shot of that show is gonna be

5:30

blowing off my back as I'm flying through the air

5:32

on the material That's

5:34

pure velvet. That's nice. That's this is

5:36

like the dry fit the dry fit

5:38

We can velvet and maybe there's an

5:40

overshare But the dry fit material has

5:42

this combustibility chemical with my skin where

5:44

I put it on what's going on

5:46

here I put it on and I

5:48

smell that's three What

5:50

three that's three? What

5:52

Michael is part stop piling excuses in advance for

5:54

the money? I'm just saying I'm what if I've

5:57

now that's all He came in today's

5:59

a guy Where is this five key a

6:02

Central Park JP Morgan corporate challenge?

6:04

Yeah, he goes guys I was

6:07

on the phone and I stepped off the curb and hurt

6:09

my ankle. No, no, no, I Crumbled

6:13

I took a step off the sidewalk and I my ankle

6:15

like that. I almost hit my knee That's how

6:18

many weeks of training you miss because nothing good all

6:20

wrong tomorrow All right, and but now also we have

6:22

an issue with the shirts. I

6:24

have no issue with the shirt I'm just that it's combustible

6:26

with my you just said if you run in this race

6:28

with us You're gonna be on fire smelling. I

6:31

will smell that's okay. That's fine. You'll be

6:33

nowhere near me. I don't mind Okay, what's your

6:35

shoe of preference? What are you running? I

6:39

just I went in my on clouds although although so Josh

6:41

and I were just in In

6:44

Los Angeles and we were walking from you

6:46

come sir Josh. I don't know we were

6:48

walking up And

6:51

we're walking up the hill and he like sell to

6:53

his knees. I didn't fall to my knees. I'm like

6:55

Nicole I took a break. I

6:57

didn't write you know, I didn't fall right, but you can't

6:59

walk but you can run I don't get

7:01

it. No, I can walk and run but I took a

7:03

break It was a lot of

7:06

walking you walked us into the Hollywood Hills. We have

7:08

photo evidence Well of me sitting

7:10

set the worst that ever happened Really

7:17

no at this point it's pure spite I'm

7:20

only I'm only running a runner

7:22

at this point I'm only running and training

7:24

because Michael said I can't

7:26

finish a 5k. Well, I didn't know I assume I

7:29

thought it's a safe assumption. Was it 3.21 dude? It's

7:31

it's 3.5 miles. I don't know pretty much Slightly

7:40

longer than a 5k. Have

7:42

you done this before these are metric miles? The

7:45

JP Morgan one. Yeah, he's a real runner bad He

7:49

ran the marathon like three three hours 40

7:51

minutes. No two hours 40. I guess you what

7:53

I'm saying is like The

7:56

people that are running in this race are not marathoners.

7:59

It's just like regular people completing

8:01

a 5k it's like no big

8:03

deal are

8:05

you kidding me oh that's not great

8:07

for Michael Shinspielin's the hell I line up

8:10

I line up in the

8:17

back you know David Kelly's a mayor I don't want to

8:19

be in anyone's way who

8:22

is David Kelly dr. David

8:24

Kelly he he got when he

8:26

was here we were talking about he's run

8:29

marathons yeah well I don't but

8:31

you're right about that point everyone tries to

8:33

get up to the front and then they

8:35

can't really explode out of the gates and

8:37

something like this it's Hillary and hotter I

8:40

think though that we

8:46

want to not lose sight of the fact that it's for charity right

8:50

like like yeah isn't

8:52

that for charity yeah I'm pretty

8:55

sure it's gotta be right it's the

8:59

corporate channel they raise money but I think it

9:01

we do a great job making a well-known

9:04

who's answering it John we good I

9:08

think I think they raised money for the park itself so

9:12

Apple reports tonight what's

9:14

your whisper number you you

9:18

know how we do you know how on CNBC like we

9:21

do a recurring segment does the

9:24

market need Apple to route you know like

9:26

you've heard that before I haven't heard that one oh why I'm

9:28

talking about this later I will go there we'll

9:30

go there later

9:33

is that me Ben

9:36

Carlson take it very

9:40

confident in my assertion Ben you're

9:44

in the studio with Jeff de Graf and Josh we're

9:46

about to start recording the compound and friends what's on

9:48

your mind that's your calling

9:50

in you called

9:53

me a man that's embarrassing Ben

9:55

Mike Mike called you because he missed you while he was in

9:58

California this week all right love you I'll call you out Love

10:00

you. Love you is a lot. Very

10:02

confident in my shirt. Very confident in my shirt. Shout

10:04

out to Ben. What kind of show we

10:06

doing here? Uh...

10:09

One more second. And

10:11

on that note, turn on Do Not Disturb. Good

10:14

idea. Good idea. Good idea. True. You

10:18

called me, it was pretty good. True

10:21

story. He does have me there. I actually called him. Are

10:24

you on a good one? Yeah, I think so. Alright. Three

10:27

o'clock. Coming in. Thank you. I

10:58

may maintain positions in the securities discussed in

11:00

this broadcast. Today's

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globalxetfs.com.

11:37

Episode 140. Ladies and gentlemen, you

11:39

are now tuned in to

11:42

the world's greatest financial slash

11:44

investment slash lifestyle

11:46

podcast. You're

11:48

the best fan of the world last week, this week.

11:52

Michael and I were in Los Angeles. Great

11:54

turnout, great enthusiasm. We

11:56

had so much fun meeting you guys. Thank you

11:59

to everyone. who got up, got in

12:01

the car, came to see us in Los Angeles.

12:04

That show, for those of you who missed it, is

12:07

going to be on all channels

12:09

shortly. But I wanted to

12:11

just give a shout out to the fans who

12:13

came. Today's show is going to be amazing. We

12:17

are with technical greatness,

12:20

is the way I would phrase

12:22

it. Our friend Jeff DeGraff is the chairman

12:25

and head of technical research

12:27

at Renaissance Macro Research, AKA

12:30

RenMac, Jeff DePiment, Merrill Lynch, Lehman

12:32

Brothers, ISI Group. He is a

12:34

member of the Institutional Investors Hall

12:37

of Fame. He's

12:39

a private pilot. He's

12:42

a CMT and a

12:44

CFA charter holder. Jeff DeGraff, welcome back to

12:47

the compound of the class. Thank you, it's

12:49

been a while. You didn't realize

12:51

how long it's been. No, no, we didn't realize

12:53

how long it's been. So happy that you're here.

12:55

So what's the day today? We're

12:57

taping this on Thursday, May 2nd at approximately

13:00

3.08 in the afternoon. And

13:02

I guess it's been 16 months since

13:04

you were here? Almost 16. Okay.

13:07

Should we go back to what Jeff told

13:09

us last December? What did you tell us

13:11

last December? Well, it was

13:13

two December's ago. Two December's ago. Excuse me, two December's

13:15

ago. What was the name of it? What did we

13:17

call it? Oh, the change

13:19

is coming? Yes, or something changes here,

13:22

something like that. Something catchy.

13:24

Yeah. Yeah, catchy. The game

13:26

has changed. There we go, right. But you,

13:28

so I know you're not like,

13:30

you don't do like extended victory laps, but there

13:32

were a lot of key things about that period

13:35

of time that were changing. And

13:37

some people picked up on them, some people

13:39

didn't. Yeah. But in the charts, it was

13:41

pretty clear that stocks were behaving differently. Definitely.

13:43

What do you remember about that moment? And

13:46

what do you think you'll be able to

13:48

use going forward as a reference point for

13:50

your own, just like, oh, here's how the

13:52

market works. Like edification. Yeah. So

13:55

it's almost cinco de mayo, so I brought you guys

13:57

some margaritas. We appreciate that.

14:00

Cheers. Happy Synchodomyo. I'm going to hold off on

14:02

my first step until we get at least 45

14:04

minutes in. That's fine. No problem. I'm already three

14:06

in. Okay, good. So

14:08

a couple of things were going on then. I think

14:10

the big one, and this has been really a part

14:12

of our process for 25 plus years, which

14:16

was this relentless improvement in the

14:19

credit markets. It just was

14:21

continuing to get better and better and better

14:23

corporate spreads, etc. And

14:25

that's just not something that you'd expect to see

14:27

if we're going into recession, which is what everybody

14:29

was predicting. And look, I mean, the curves inverted.

14:31

There are a lot of signposts there that say,

14:34

hey, historically, when this happens, then that happens. But

14:37

if you looked at the real-time indications, what

14:39

the blood pressure of the market actually was,

14:41

it's like, this patient's not dying. This patient

14:43

is actually stable at a minimum

14:45

and maybe actually flourishing underneath the surface. So

14:47

we had Neil Dudda on recently, your partner

14:49

at Renmat. And similarly, he

14:52

became known for being one of the

14:54

few voices in macro, saying, I know

14:57

everyone, I know the

14:59

consensus is now recession is a foregone

15:02

conclusion, but I don't see it that way. And

15:04

he ended up being right as well. What's interesting

15:06

to me is he arrived at the

15:08

same conclusion that you did, but he's looking

15:12

at the economy and you're looking at market behavior.

15:14

Right. And I think that's an important part

15:16

of our process at Renmat, which

15:18

is we don't get in a room and say,

15:20

I'm bullish, so therefore you be bullish, or you're

15:22

bullish, therefore I'm going to be bullish. We come

15:24

to our own conclusions. And

15:26

I think it's important because if you don't, then

15:29

you're going to lose good people. I mean, you

15:31

have to have your own sort of intellectual horsepower

15:33

and curiosity and independence. And

15:36

so when we come together and I'd say

15:38

we're on the same page, boy,

15:40

I'd say it's probably 70% of the time, but

15:43

it's for different reasons. And

15:45

we can play off each other and then we can also

15:47

challenge each other too. And so I think it's really helpful

15:49

to say, hey, Neil, what's going on

15:52

with the truckers? Oh, this is something to do

15:54

with labor unions. Okay, that's fine. The charts look

15:56

bad, but that's an idiosyncratic problem. Right. And

15:59

So we. We play around that and nobody

16:01

does that and I think it becomes a real

16:03

problem. One who do you follow because everybody some

16:05

religious and be wrong? So do I really want

16:08

to be stuck torn down the drain with somebody

16:10

else? Thought of myself, funny that you say that

16:12

on them are obviously Michael an eye on selling

16:14

research. But ah, we do a show on you

16:16

tube that's been running for like five years now

16:18

and we often disagree. But. We work

16:21

together. It's. Possible to have a

16:23

you a workplace environment. Where.

16:25

Two people arrive at different opinions for entirely

16:27

legitimate reasons. Yep, and eventually one of them

16:30

will be right. The of, or maybe both

16:32

will be wrong. And. That's like okay

16:34

so we don't have to have a

16:36

situation where you work here. I work

16:38

here, I I has seniority. Therefore, you

16:40

have to accept what I'm saying. Gross.

16:42

So I think that that's the way

16:45

things should be. But. I also

16:47

understand, especially on Wall Street where reputations

16:49

and egos. I understand why. does a

16:51

lot of research shops where it's not

16:53

that was right for herself on enlisted

16:55

in our business the the date is

16:57

changing daily right? A Me: Neil gets

16:59

a data point. Every. Single Day

17:01

if I mean if he's looking globally,

17:03

it's homes every single our rights. We

17:05

get market feedback every single day and

17:08

so you know you're gonna. You're gonna

17:10

have to be malleable and your views

17:12

are going to change through time as

17:14

the data changes in the market. So

17:16

you should be thinking about things. So

17:18

in a being very rigid in those

17:20

outlooks is just. it's a recipe for

17:22

disaster. Yeah, he really needed to be

17:24

fluid and you're thinking in. And I

17:26

have something that I've always thought about,

17:28

which is. Okay, Here's where

17:30

I think we are now. what are the likely

17:32

paths to where we're going rate And so what

17:34

are those signposts? What are those things that were

17:37

going to tell me that I'm on the right

17:39

path or a mom or on the wrong path

17:41

of i'm on the wrong path and what is

17:43

that path? How to identify that path and when

17:45

I do with them for their and that's really

17:47

it's a daily process of and I write daily.

17:49

Our clients get of shows that the graph daily

17:51

these they see or daily commentary and it is

17:53

a royal pain yes was no doubt about it

17:55

sorry but claims of their the good but the

17:58

reality is I do as much for my. As

18:00

I do for clients because it forces me

18:02

to look at the markets every single day

18:04

and figure out what's going on. Or at

18:06

least put the chart and the pile that

18:09

says i got a figure that out like

18:11

I don't know what's happening here Of that,

18:13

what should I be doing about that? Do

18:15

you think the market as noisier than it

18:17

was when you started just because you mentioned

18:19

the data points that we get there? So

18:21

many more data points that literally technology wasn't

18:24

able to capture? Probably when you're first, when

18:26

you're start your career. I think every six.

18:28

there's an old story about. A

18:30

client who used to messenger

18:32

car service black car ah the

18:35

financial times to his office

18:37

from Jfk to get the. The.

18:39

Head start to get the information advantage right?

18:41

So you have a guy their ads. Whatever.

18:44

it was four thirty in the mornings. grab

18:46

in paper to information. highway yes was obvious

18:48

to think it's a race otherwise knows the

18:50

Van Wix. Ah, read to his office. we

18:52

can read in early before the rest. The

18:54

streets. It's. A good question.

18:57

I mean, work. We don't find that there's

18:59

more or less mean reversion. We don't find

19:01

that there are more. Or.

19:03

Less have faults. Trends are legitimate

19:06

trends that the markets chemistry is.

19:08

We view it the way that

19:10

we look at the world has

19:12

stayed relatively. Similar. That's

19:14

exactly the same. I will say that things like

19:16

bread speak at addict as because of Bts breath

19:18

tends to pendulum. In other words it'll be a

19:20

hundred or one hundred percent of the financial stocks

19:23

or up on the day. Or one hundred percent

19:25

or down because it just becomes a ballet. their

19:27

bought and sold Now yeah it's just easier to

19:29

do it that way that were backing me on

19:31

my day at Lehman. it wasn't It was never

19:33

like to have your front of asked we could

19:35

do it with to names on for you to

19:37

find. Things within the markets are different but. I.

19:40

Made a chart of the Rolling Thirty

19:42

day. Saints. In the Sp:

19:44

Five hundred gone back to the beginning of

19:46

of time and just by that one muttering.

19:49

There's. no there's no difference between now and

19:51

hundred years your twins within the sp

19:53

five hundred f or whatever marketers using

19:55

just it's any kids or yeah yeah

19:57

i want an insurance on ask you

19:59

if you think it's possum for a

20:01

technician to have quote-unquote conviction versus

20:04

someone that's looking at macro

20:06

or fundamentals. I'll tell you why

20:08

I'm asking that question. You're looking at

20:10

the charts every day. You might

20:12

believe something on a Monday that two weeks

20:14

later, two following Mondays

20:17

later, becomes completely invalidated

20:19

by price. As

20:21

a technician, you can't double down on what you

20:23

thought two weeks ago. You have to say this is

20:25

what I thought, but this is what I think now. It's

20:29

a discipline that inherently does not

20:31

lend itself to the concept of

20:33

conviction if you're truly focused on

20:35

price because prices change. Someone

20:38

who follows the macro, they

20:41

probably shouldn't have as much conviction as maybe

20:43

they have, but they can say,

20:45

no, this is a blip. My original opinion is

20:47

still right. What's

20:50

the push and pull within your own mind

20:52

when you're deciding whether or not you've

20:54

changed your mind or you decide,

20:56

no, I still think I'm right because

20:59

you kind of have to be somewhat malleable,

21:02

not in your principles or how you look at things, but

21:04

in your conclusions. I think

21:07

the word you use is probably the

21:09

most dangerous word on the street, which

21:11

is conviction. What conviction implies is that

21:14

you know something that the rest

21:16

of the market doesn't know. And

21:19

everyone else is wrong. That's pretty dangerous in this business.

21:22

Look, there are people that can make money doing that,

21:25

but there are also plenty of people that lose a lot

21:27

of money after they've made it that do it. We

21:31

have an old saying, conviction

21:34

kills and dogma is

21:36

death. And I think

21:38

you have to be pragmatic. And when you're

21:40

pragmatic, the idea is that look, I believe

21:42

that this trend is in place. I try

21:45

to really disassociate myself with the

21:47

narrative and the news flow. That's pretty hard to do,

21:49

but I really try to do that. And you have

21:51

to rely on those tools. Now,

21:56

for us, sentiment is important. For

21:58

us, we're going to be doing it. mean

22:00

reversion indicators, long-term mean

22:02

reversion indicators are important. And

22:04

in the interim, the trend following indicators are important.

22:07

So if I'm in a situation where I know, and I

22:09

know we talked about China a little bit, China

22:12

to me is very similar to the last time you

22:14

had me on for the US. I think that we're

22:16

in a game-changing environment. We gave you

22:18

a shot on a halftime report today. I appreciate

22:20

it. You were on with Scott last night talking

22:23

China or something? Yeah, two days ago. Two days

22:25

ago. Okay. All

22:27

right. I'm going to walk you through it, which is we

22:29

know that the long-term alpha generation, just by

22:32

owning the Shenzhen 300 or the ETF, whatever

22:34

you want to look at, the long-term alpha

22:36

generation is the worst it's ever been in

22:38

the history of our data. You've

22:41

never lost more money in China versus

22:43

China versus S&P. MSCI

22:45

world, the entire world. So

22:47

you've never lost more money with more volatility

22:49

than you have as of basically the beginning

22:51

of the year. So

22:53

that to us starts to perk our antenna.

22:56

Okay, this is so bad that maybe it's

22:58

good, but that's the first set. The

23:01

second is then where is the sentiment? Usually the

23:03

sentiment will follow the price and particularly the risk-adjusted

23:05

price. We measure a lot

23:07

of different things, but the ETF outflows were one that

23:09

stood out to us that people are just saying, why

23:12

am I in China when I can own Nvidia or

23:14

whatever the case may be? Yeah. So

23:16

you've got that behavioral aspect that set itself

23:18

up. Then we wait for price.

23:20

We wait for price to confirm. We

23:24

made a tactical call back at the

23:26

end of January that we thought the

23:28

confluence of those two

23:31

sentiment and the alpha was enough to say, look, let's

23:33

play for a bounce. I think this is washed out.

23:35

That was the bottom. But yeah, we

23:37

thought it was at least a tactical bottom. That

23:40

tactical bottom to us is like, that's 20%, 25% in a pretty short

23:42

period of time. You can

23:44

play it and make money, and it's a pretty low risk

23:46

way to do it. But what's happened

23:48

is we never came back and retested. We actually

23:50

stayed up there, and now we're starting to break

23:52

out again. We're starting to change these trends. And

23:54

so from my standpoint or my seat, I look

23:56

at it and say, look, the biggest sin I

23:59

can as a technician

24:01

and as a listener to

24:03

the market is not believing it

24:05

when it happens. I've got these

24:08

two preconditions that I know historically are pretty good

24:10

and now the market is telling me that it

24:12

wants to go higher. I might

24:14

be wrong. There's no doubt I might be wrong, but if

24:16

I'm wrong, I'm going to be wrong by that much. How

24:18

much is K-Web up off that late January print? I don't

24:20

know, probably 20ish percent. A

24:22

lot of bonafide bull markets. You know what's so funny about

24:25

what you're saying? We're looking at

24:27

this through the lens of price and technicals. Somebody

24:30

that doesn't focus on that at all

24:32

could have made the exact same bull

24:34

case on Chinese equities

24:36

in January, but for entirely different

24:38

reasons. Somebody who focuses on

24:40

the news flow would have said, hey,

24:44

the authorities on Beijing seem

24:46

to be saying a lot of things that are constructive

24:49

about their own stock market. They threw

24:51

out the head of their version of the SEC. They

24:54

enacted all sorts of more friendly policies.

24:59

Even what's his name made an appearance, Jack

25:02

Ma showed up in an interview

25:04

or something. This

25:06

guy was exiled probably where Napoleon bought

25:09

the farm. Were his hands in front

25:11

of him or were they behind him

25:13

still? Dude, he was relaxed and he

25:15

was talking about Alibaba or something publicly.

25:19

Somebody that focuses on news flow and not

25:22

technicals could have said, I think these stocks

25:24

are worth the risk here. They're in an 80%

25:26

drawdown or whatever. Now you could have

25:28

somebody that's fundamental. They could say, oh, valuation-wise, these are

25:30

the cheapest stocks in the world, growth stocks.

25:33

They were. The Chinese internet companies were

25:35

growing still, I think 20%, 30%. They

25:39

were selling for multiples as if they would never grow again,

25:41

probably because the risk was existential. Like

25:44

will these things get taken off the US

25:46

markets? That was a term

25:48

that I had heard a couple of times.

25:51

It's always music 20 years, which is this

25:53

market is uninvestable. Uninvestable

25:55

was the consensus on these assets.

25:58

Yes, correct. Perfect. What

26:00

are you going to start buying Russian assets? I

26:03

was going to go next. Anyway,

26:06

I think that's really interesting that different

26:09

people looking at the market with a different

26:11

discipline could have all reached the same conclusion.

26:15

That looks like one of the better global

26:18

markets you're to date right now. That's a good

26:20

point too, Josh, which is, is it easier to

26:22

create a bull market in the lone

26:27

bear market when all the other G7 are

26:29

in bull markets, or is it easier to

26:31

create a bull market when everything

26:33

else is in a bear market?

26:35

Of course, there's just some tailwind

26:37

that you get there. I think

26:40

what could be interesting, it's not

26:42

our call, but I'm thinking about it, which is,

26:45

are we today in an asynchronous

26:48

world? In other words, the Fed's trying to slow

26:50

down the US. There seems to be some evidence

26:52

that it's happening a bit. At

26:54

the same time, you have China stimulating, do we

26:57

end up doing this, that in aggregate, it ends

26:59

up being 2.5%, 3% growth, but nobody's growing too

27:01

hot too fast. It's

27:05

not collectively synchronized. As

27:07

we slow, then we start to stimulate, they speed

27:09

up or get too hot, they start to pull

27:11

it back. How the world

27:13

used to be before the great financial

27:15

crisis, you had different central banks moving

27:17

in opposite directions at all times, right? Before

27:21

the 90s was really it. It came out that

27:24

modern portfolio theory started adding

27:27

to particularly EM back in

27:29

the 80s, early 90s, and

27:31

about the time that that was published, it stopped

27:33

working. For the last, that's an interesting observation because

27:35

for the last 10 years, it was all global central bank

27:37

coordination. Everyone was doing the same thing. You

27:41

have less currencies now also. The 80s and 90s,

27:43

every country had its own currency. Now

27:45

there's four that matter. It

27:48

would be nice if we had an environment where

27:50

if the S&P has a bear market, you can call

27:52

your clients and say, all right, cool,

27:54

but Brazil and Japan kind of bailed us

27:56

out there. We just haven't had that

27:59

in a really long time. I remember the

28:01

back in the days in the early

28:03

90s where the the big bearish Narrative

28:07

on the US was you've got the

28:09

second largest Country in the

28:11

world which was Japan in this massive

28:14

bear market. There's no end to it How

28:16

are we ever gonna you know, not be

28:18

sucked into that vortex? Yeah, and we weren't

28:20

right and so You know the

28:22

stranger things happen. I guess is the way to think about not

28:24

to belabor we can move off this China thing in a minute,

28:26

but I was telling you before we started that I Bought

28:30

China and a few days later. I said I don't

28:32

want to deal with this headache Guys

28:36

the same thing washout and sentiment

28:38

reading proxies in Completely

28:41

washed out and the stocks did

28:43

stop going down I said, you know what? I'm gonna take

28:45

a shot and then I couple this edge So, you

28:47

know, I just don't feel like I just don't feel like allocating my money I'd

28:49

rather just put somewhere else there because there's so many things working over here. Yeah

28:53

but there's a big difference between identifying

28:55

a trend change and

28:57

then Putting the money there and

28:59

sticking with it like on the way up and

29:02

especially during the top. It's hard It is hard.

29:04

I think you know an important part. I

29:07

started trading commodities probably 25 years ago Best

29:10

thing I ever did in terms of just creating

29:12

the discipline one because there's a massive amount of

29:14

leverage So you can't mess around to

29:19

It's it really lends itself to technical

29:21

analysis because there's no way I can

29:24

know what's going on on the Ivory

29:26

Coast with cocoa at the Same time I know

29:28

what's going on with soybeans. I mean, it's just

29:30

it's impossible You have to obey

29:32

price on that market. No matter what so with

29:35

that I knew at every point where I

29:37

was gonna get out or where I was gonna

29:39

get in right? No, if Sandra butts no messing

29:41

around I just knew where it was gonna

29:43

be And so it's not that I didn't

29:45

have that emotional creep that comes in and says I

29:47

was this right Should I be here should I be

29:50

here? But it just kept you disciplined and just

29:52

said look, you know, if I'm wrong fine I'll

29:54

be wrong at this level. You knew before the

29:56

I knew before the trade right? Absolutely Federal

29:58

Reserve FOMC was

30:01

yesterday rates were left unchanged Seemed

30:05

like a pretty positive reaction. I felt

30:08

like today like people woke up and just said, you know

30:10

what? Yeah, that's kind of cool He

30:12

didn't he didn't double down

30:14

on hawkishness. Yeah, he didn't seem nervous He

30:17

didn't intimate that we

30:19

could have hikes on the table These were

30:21

some of the things that crept into market psychology

30:23

during the course of April I think April was

30:26

the the worst month we've had

30:28

in in September or something So it's

30:30

already 500 with so a lot

30:32

of like rollbacks of people's expectations for rate cuts

30:34

in the second half of the year and A

30:38

lot of concern that you know, the

30:40

economy is slowing But maybe it's stagflation

30:42

because inflation is still with us, etc

30:45

So he kind of poured cold water on all of that

30:47

and the market was able to recover. Is that how you

30:49

read it? I do read it that way I think

30:52

the setup was important though and the setup to

30:54

us was There

30:57

was a there was a narrative that

30:59

developed Partly because of what you're

31:01

talking about which was policy wise and partly because

31:03

of what we've seen from AI And

31:06

we call the momentum narrative, right?

31:08

So right you had momentum running

31:10

in Basically

31:12

the 94th percentile the spread between high

31:14

momentum names and low momentum coming into

31:16

April In as actually

31:18

as early as early March. Okay in that so

31:21

we are We are

31:24

unapologetic momentum players trend

31:26

followers I mean we will do it all

31:28

day long until it gets to

31:30

an extreme where it tells us that

31:32

that good chart is actually Vulnerable because

31:35

the momentum factor is so strong. You want

31:37

your momentum going more like this and less

31:40

like that Yeah,

31:42

I want I want the spread between the best

31:44

stocks and the worst stocks to be somewhere between

31:46

the 20th and 80th percent You

31:50

want a slope you don't want Empire State Building,

31:52

correct, right? And so once you get

31:54

there, it's the one area that we found that we're

31:56

gonna say hey, we're selling good charts We don't want

31:58

to be a part of this And

32:01

what you end up with from

32:03

momentum extremes is usually a sentiment

32:05

extreme, right? So price drives

32:07

behavior. It's not the other way around.

32:09

So when you get the strength people

32:11

become more bullish They start

32:13

making Called irrational decisions

32:16

or at least you know, not well

32:18

thought-out decisions And

32:20

so you have this pocket

32:22

of opportunity for disappointment And

32:24

I think that's exactly what the Fed did and what we

32:26

saw with the inflation numbers is It

32:28

wasn't that those numbers were so bad It was

32:31

that the expectations were so high Yeah And it

32:33

just didn't take as much to push you

32:35

off into that what we think is a consolidation

32:37

slash correction right now not the end of the

32:39

world but Certainly it was a

32:41

function of where the positioning was and the expectations

32:43

of where things were gonna be It was I

32:46

think it would I think they're exactly right. It

32:48

was really easy to make money in

32:50

January February March We had that narrative

32:52

of the broadening which was true at the

32:54

time You could I

32:56

think a ten out of eleven sectors were positive

32:59

on the year you were making money

33:01

and things that Didn't

33:03

really work last year. Yep, but then also

33:05

the stuff that worked last year was really

33:07

working this year you had a super micro

33:10

and Ariston networks and

33:12

this whole new crap of AI names leading

33:14

and it was just easy And

33:16

you woke up you bought NASDAQ stocks by the end

33:18

of it, you know by the clothes you were higher

33:20

Yeah, and once it gets like that, I totally agree

33:23

with you. It changes people's behavior They bet bigger they

33:26

are bolder. Yep the way they

33:28

come into stocks and More

33:31

stocks start working because they start looking for what's

33:33

the next in video? What's the next?

33:35

All right, so we had that behavior I think it

33:37

got washed out in April I don't

33:39

know though on the internals if it really

33:41

hit extreme levels I mean

33:44

more like when you talk to people they

33:46

don't seem as bullish as they seemed in February.

33:48

Definitely not. Okay, but I wouldn't

33:50

say they are To the

33:52

point where we can say with high

33:54

conviction that this correction if it's

33:57

oh, no, I agree Nobody because nobody's

33:59

despondent, right? buying stocks. Just as one

34:01

random anecdote. So this is a chart of

34:03

Caterpillar. Right? Like the correction

34:05

that we just happened was absolutely

34:08

necessary. Right? Like this is it. You

34:10

look at this, you say this is a good thing. You

34:12

need these corrections along the way. This is what sets up

34:14

the next like higher if we do get one. I'm not

34:17

speaking of Caterpillar, but just generally speaking. So interestingly enough, the

34:19

two areas that had were reflective

34:21

of the most momentum was

34:24

tech obviously. Right? That's easy. But

34:26

industrial was the second tech has,

34:28

has, has corrected from the 23rd,

34:30

94th percentile of momentum down

34:35

to the 61st. So that's kind of done what you

34:37

would hope it to do. It should get a little

34:39

better, but not the end of the world. Industrial's

34:43

were in the 99th percentile. So higher than

34:45

anything we'd ever seen. Those are the best

34:47

charts. They're unbelievable, but it's only corrected the

34:50

94th percentile. So

34:52

the point being, there's probably still more of

34:54

that to work itself out. Now that doesn't

34:56

mean that it's bearish for the next year, but

34:58

what it means is that the next three months,

35:01

the next maybe six months, you're probably going

35:03

to have underperformance. And that's why to us, the

35:05

narrative is important because once you get those

35:08

momentum spikes, the narrative generally changes. People want

35:10

to go back to whatever that was back

35:12

in January, February, we want that right.

35:14

But the market doesn't give you that the market

35:16

will not be a bear market. It'll still be

35:18

in a bull market or a bull phase, but

35:21

it will pick up on something else. And that's

35:23

why the China breakouts,

35:25

that's why the copper breakouts, these things are

35:27

so important to us because we feel like

35:29

the high probability trade is not

35:32

bullish to bearish, but bullish

35:34

to rotational into something else.

35:36

And that's what we're still trying to

35:38

sort through in the dark here. Where

35:40

are those charts? Where are those lead

35:43

or those potential leadership names? But

35:45

that's our right here. That's our top

35:48

play. One of the ways that we

35:50

got a positive reaction post

35:52

FOMC, is that okay,

35:55

we still have no idea when the rate cutting cycle is going

35:57

to start, if it's going to start this year or not. But

36:01

they did say that they would slow the pace

36:03

of reducing the balance sheet starting in June, which

36:06

is something that maybe we don't focus on all the

36:08

time. But shrinking that balance

36:10

sheet is the fact they're pulling liquidity from the

36:13

markets. It's doing so in a fairly invisible way,

36:15

unless you work in a bank. You can't really

36:17

see it. It's not posted in the newspaper. It's

36:21

a little liquidity here in the room with

36:23

us right now. Yeah. But specifically, it was

36:26

cited that that decision to do that

36:28

was to ensure that money market funds

36:31

don't experience the volatility and

36:33

stress that they saw

36:35

in September 2019. Which

36:38

is when they started doing reverse repo out of nowhere.

36:40

And people were like, wait, why are you doing that?

36:42

So I guess maybe that was like a

36:44

little bit of an olive branch to the people that were hoping

36:47

for a sooner cut. But

36:49

all things considered, we

36:51

still have high inflation points. And we still have

36:53

no idea when we're getting rate cuts. And

36:55

the market is holding up fairly well in the

36:58

face of that much uncertainty. And I'm actually a

37:00

little bit surprised that the reaction wasn't worse. From

37:03

the markets. Yeah, for stocks. Yeah. You

37:07

don't sound like you are. Yeah. Look,

37:09

I think we had two weeks ago, we had there's

37:11

three things that we look for at a low. We

37:14

look for what's called an external oversold condition, which

37:16

I can talk about in internal oversold condition. And

37:18

then we look for a sentiment extreme, a sentiment

37:20

spike. We'll stop right there. What is the difference

37:22

in those two things? So an external oversold condition

37:25

is you look at the S&P, it's

37:27

a conglomerate of 500 different names. And

37:30

that oscillator, we use our

37:32

own oscillator is oversold. And

37:34

it says the market's oversold. So you could put that on,

37:36

you could put it on corn, you could put it on

37:38

copper, you could put it on cotton. It doesn't matter. It's

37:40

just what it is. An internal oversold

37:43

condition is what's happening to the constituents

37:45

within the market. So the first one

37:47

doesn't care about what 3M's weight is

37:49

versus Google versus anything else. The

37:51

internal is individually how many names are oversold,

37:54

right? We do that on a percentage basis.

37:56

So 54% of the S&P 500 may a

38:00

20-day low simultaneously back about two weeks

38:02

ago. That's a good number. That's

38:04

a number that says- That's a washout number? Yeah.

38:07

The risk managers are tapping people on the shoulder saying, I don't

38:09

care what you think about XYZ, take it down. We

38:12

don't want that much of it. We

38:15

had 10% of the names trading above their

38:17

own 20-day moving average, very

38:19

short-term moving average. Both those are internal

38:21

measures of being oversold. 90% were

38:23

below. That's a washout. Yeah. So

38:25

we have an external oversold condition. We have

38:27

an internal oversold condition. We start

38:30

saying, okay, this is getting- we're in the

38:32

zone. This is the zip code. What

38:34

we'd love to see, it doesn't always happen, so

38:36

this is the challenge. What we'd love to see

38:38

is spiking put call ratios, something that shows that

38:40

people are now- That's the sentiment

38:42

part. Right. Positioning themselves differently,

38:44

playing more or protecting more for the downside than

38:47

the upside. We hadn't really seen that. Now, it's

38:50

not that surprising because one, the

38:52

correction lasted all about three weeks. So sentiment's

38:54

a function of time and price. We're down about 5%

38:57

three weeks ago. Well, so it wasn't totally severe. Right.

39:00

So I sense that it's just going to kind

39:02

of grind a little bit more and take

39:05

it out, but we had a good oversold condition.

39:07

The problem is, is it really a correction if

39:10

Amazon and Alphabet are making fresh all-time

39:13

highs? Yeah, I agree. You

39:15

know what I mean? It's hard to really characterize it as

39:17

a correction. Yeah, but that's why we use those internal measures,

39:19

right? Because usually if it's above 50%, it's good enough, right?

39:23

As somebody who wants the

39:25

market to go higher over time, I would much

39:27

rather- Is that you or me? Me. Okay.

39:31

Not you. As somebody who wants to

39:33

see that, I would much rather see this sideways

39:35

corrective action as opposed to the market just continuing

39:37

to go higher and higher and higher because that

39:40

sets up for instability. Yeah. Yeah,

39:42

I agree. If we have a consolidation that

39:45

takes us in through the end of May, I think

39:47

that's good news. Okay. If

39:50

you look at presidential election years, the

39:53

lows seasonally in election years tend to come

39:55

right around Memorial Day. So there's

39:57

no- Yes. There's notion of sell in May and go

39:59

away. For one, I

40:01

don't know where they ever came from because it's not

40:03

really true. You should be selling in mid-July. It does,

40:05

Ryan. I know. It does. We have those charts. We'll

40:07

get to that in a second. In July and say

40:09

goodbye. I want to make sure that we hit your

40:11

Renmak Econ market cycle chart.

40:14

What are we, can I throw this out

40:16

please? It's a clock. Yeah. We've got inflation and

40:18

growth. What time is it? Text the treasure

40:20

map. So what time is it? Please. So

40:22

it's nine o'clock, right? This is juxtaposing inflation versus

40:24

growth. I'm sorry, Jeff. Tell everyone what is

40:26

this called? This is our market cycle clock.

40:28

Renmak market cycle clock. There's

40:30

no CM there. There's a- You guys should CM

40:33

this. Yeah, we should. Okay. There's a

40:35

relationship between inflation and growth. All

40:37

right. There's a lot of

40:39

different ways to measure both. It's proprietary how we

40:41

do it, but it's all public information. We're not

40:43

coming up with something terribly

40:47

outside the box here. We do the

40:49

math. The transformation is a little unique in that we

40:51

use some

40:54

diffusion indices versus

40:56

rate of changes, et cetera, because they tend to

40:59

be echoey and you don't want that. We

41:01

do the same thing. Yeah, right. So we concur. Well,

41:03

I mean, you know, COVID, right? What happened to COVID?

41:05

Wait, what do you mean diffusion? What

41:08

are we saying? Good or bad. Okay. Good

41:10

or bad, better or worse, right? Okay. Not

41:13

the numbers. He's neither CFA nor CMP. You have

41:16

to dumb it down, please. It's fine. No,

41:18

it's fine. Talk to me as if you

41:20

would a small child or a golden retriever.

41:22

I understand. Okay. I understand.

41:25

The inflation has perked up. Those shadows that you

41:27

see is where we were over the last six

41:29

months, right? So we were down the bottom left-hand

41:31

zone. The color, this is for you, Josh. But

41:33

you want to be there. You want to be

41:35

on the bottom right? Absolutely. We were there

41:37

the entirety of 2023. But is that

41:39

why it's that dark colored green? Yes, because good things

41:41

happen. That's the best place to be. Yes. So

41:44

now we're drifting away from that. We're

41:46

drifting in a spot that's now historically

41:48

more average returns. But here's the kicker.

41:52

It's really unusual that

41:54

this move clockwise, usually

41:56

it moves counterclockwise. In other words, when we're in

41:58

the bottom left, expect to

42:00

go to the bottom middle this way

42:02

and then start going higher. So

42:05

we think and Neil would. That's

42:07

a re-acceleration of inflation. That's why that

42:09

happened. Right. But where Neil's

42:11

coming down is these data points that

42:13

we're seeing, the long-term data points would suggest

42:15

that that rate of change, that inflation is

42:18

going to continue to move in a

42:20

favorable trajectory. And what we've really seen

42:22

is kind of these random four

42:25

or five indications that have popped, but

42:27

they've had enough weight in the

42:29

inflation prints to give us more

42:32

than what's really underlying trend inflation.

42:34

And so the idea here is it's a

42:36

very unusual move. The only time that we

42:38

did something like this before was when Saddam

42:41

Hussein invaded Kuwait and we

42:43

had the oil shock. Right. So

42:45

it was a spike in. It was exogenous. Exogenous to

42:47

that. Exactly. And so

42:49

it was a supply shock. It spiked the

42:51

inflation and then we went right back into the

42:53

end of the clock. So

42:55

this is an unusual period that we're

42:58

living through, obviously, with inflation falling, new

43:00

trend and growth still doing

43:02

reasonably well. Yesterday, Powell

43:04

said, I don't understand where concerns about stagflation

43:06

are coming from. Stagflation in

43:09

the 1970s was 10% unemployment, high single-digit

43:11

inflation, slow growth. Now we have

43:13

solid 3% growth and inflation under 3%. I don't see

43:15

the stag or the inflation. Right. I

43:17

think that's totally fair. I want to ask your

43:19

opinion on- Stagflation, by the way, would be there.

43:22

Put the clock. Put the clock

43:24

back up. I have

43:26

one more question on this. It would be in the

43:29

top left to top middle. That

43:31

would be your high inflation, lousy

43:33

growth, middling growth. Not where we

43:36

are. So, Jeff, the Y

43:38

axis here is inflation. The X axis

43:40

here is S&P 500 annualized monthly return.

43:42

Who says he doesn't know he's talking

43:44

about that? And what we're saying here

43:47

is where the hot dot is right now.

43:52

It's not in some sort of, for those who are listening,

43:54

it's not in some sort of a danger zone. It

43:57

just tends to lead to average returns. The

43:59

buck. is white. Correct. Okay.

44:03

So this is not something to be alarmed about. This is my question. If

44:05

we continue to move clockwise, which you

44:08

said does not happen very often, and

44:10

we get into that top left hand

44:12

corner, it's still a

44:14

white box where the average returns

44:16

for stocks prevail. But

44:20

if this is an aberration, that would

44:22

seem to be a huge aberration. That'd

44:24

be a big outsized event and probably

44:27

almost impossible without some question. So almost impossible

44:29

is the thing. Could

44:31

oil prices do it? Sure, absolutely. That's

44:34

usually the driver of inflation. But so would you

44:36

and Neil sit there and say, well, it's just

44:38

oil prices? Or that passes

44:40

through. That's a big deal. Okay. So

44:43

then you would say, okay, now the

44:45

clock is a doomsday clock because it is continuing

44:47

in the wrong direction. It's in a bad spot

44:50

and your clock is slow. That's

44:52

a bad outcome. And by the way, that's white and it's a

44:54

low number, 2.74% is a low number. So

44:57

why is it white? It's because it happens so

44:59

few times. 41 is the number of instances

45:02

that statistically it's too few to

45:04

really... What is

45:06

200 basis points? How much confidence do we have in 240 basis points? Not

45:10

enough to make that call. So

45:12

expectations, John, please. Expectations

45:14

of a Fed cut increased yesterday during

45:17

and after Powell was speaking. Are you

45:19

surprised for people that are listening,

45:21

not watching, are you

45:24

surprised that the expected basis points

45:26

of total threat cuts in 2024

45:29

drifted lower the entire year as

45:31

the market seemed to really not give a shit at all?

45:33

I mean, eventually did, but maybe that was just noise when

45:35

it pulled back because rates went higher. Were

45:37

you surprised by the path of this juxtaposed with where the S&P

45:39

went? And what do you think of

45:41

our chartsmanship? Good God. I'm trying to

45:44

digest what you just said. I got to

45:46

get in Josh's crib here. Let me

45:48

think about this. So in 2020, we

45:50

ignored all of these dwindling... Odds

45:56

of cuts. But in 2023, this was

45:58

all that mattered. The market

46:00

was rallying heavily on expectations of a

46:03

fed cut Yeah, that peaked and the

46:05

market seemed to not give us crap. It

46:07

kept going higher. Yeah, you already

46:09

dropped the s-bomb So you might as well say it again.

46:11

I didn't know this cable first and foremost Look

46:15

the the

46:19

The the amazing thing to me has been since

46:23

Basically a year ago. Well, that's Before

46:26

that the forward curve right

46:28

when you look at the forward expectations The

46:30

forward curve has continued to be wrong, right?

46:32

The forward curve was we've got three more

46:34

months of hikes and then we're gonna get

46:37

cuts cuts cuts cuts Right and that is

46:39

just not played itself out and the market

46:41

hasn't Really cared one way

46:43

or the other now I think it got to

46:45

an extreme back in October Right and then it

46:47

reversed and that gave us, you know, obviously the

46:49

nice tailwind that we've seen over the last six

46:51

months But now there's some concern that that's not

46:53

gonna happen. And so we were getting this correction

46:55

and that's you know taking place I

46:57

don't know how long that's gonna go Powell seems to Intimate

47:00

that he's not gonna hike but maybe he has

47:02

to push this off a little further But he

47:05

took the hike off the table yesterday, right? You're

47:07

right, right So that was something that was a

47:09

concern that was out there that's gonna affect that

47:11

probability, right? The question is is is it one

47:13

is it two is it three this year? How does

47:16

that look and that's all gonna be inflation-dependent as he

47:18

said And if you look at

47:20

Neil's work in in how he's thinking about

47:22

these data points Within

47:24

three months the the alignment

47:26

with Powell's testimony yesterday with

47:29

the data Should come to

47:31

fruition other words by the middle of the summer We

47:33

should be in a pretty good spot if those data

47:35

points kind of go back to acting the way they

47:38

should and not have this kind Of random synchronicity that

47:40

they had that really threw things off One

47:42

thing that's been powering the market higher has

47:44

been consumer spending consumer resilience in the face

47:46

of higher inflation And it's pretty astounded to

47:48

see that consumers are not changing their spending

47:50

habits But there is one area

47:52

where where it started to come to fruition and that is

47:55

where people are spending their money in terms Of fast food

47:57

Pizza Hut is having some issues

48:00

who's Starbucks

48:02

yesterday was an absolute abomination

48:04

of a conference call. In fact, the

48:06

CEO started with, and I'm quoting, thank

48:10

you, Tiffany, and thank you all for joining us this afternoon.

48:12

Let me be clear from the beginning. Our

48:14

performance this quarter was disappointing and did not

48:16

meet our expectations. Our Q2

48:19

total company revenue was 8.6 billion, down

48:21

1% year over year. Global comp store sales

48:23

declined 4%. Negative

48:26

11% comp growth in China. Our

48:28

global operating margin contracted by 140 basis points.

48:32

And our overall earnings per share declined by 7%. This

48:35

is a wild open statement, and you've

48:37

probably seen this before. I never have, where you

48:39

see a gigantic gap

48:41

on a monthly candlestick chart, because it

48:43

happened. That's the beginning. John, we have

48:45

this chart. So look at this. These

48:49

are monthly candlesticks. I've never seen this

48:51

before. So this thing gapped down

48:53

17%. Ugly. What

48:56

about the five year price chart, John? From,

48:59

is it a Y charts? So

49:01

I'm not showing you candlesticks. I'm just

49:03

showing you price. This looks like

49:06

it's on the way toward the lows

49:08

from the pandemic. That's crazy

49:10

to me. Starbucks

49:14

ended the day down 15.84% yesterday. This

49:19

is the worst day for Starbucks since March 16th, 2020.

49:22

It was down 16.2% on

49:25

the day that the world came to an end. So

49:28

that's remarkable. Our

49:32

research associate, Sean, tells me, Wednesday

49:35

ranks as Starbucks' third worst day

49:37

in public company history. Its

49:39

actual worst day was July 1999, down 28%. Not

49:44

sure what happened there. And

49:46

again, minus 16% in March, 2020. The

49:50

CEO went on with Kramer. Kramer

49:52

cooked him. He was on

49:54

with David Faber, Carl Quintanilla, and

49:56

Kramer. And it was like, good

49:59

cop, bad cop, cop and Kramer just

50:01

lit him up. One

50:04

of the things that he said, which is relevant

50:06

to our discussion now, the CEO, the

50:08

occasional customer to Michael's point,

50:11

he kept saying, I think he said it 50

50:13

times in 15 minutes, the occasional

50:15

customer is visiting less. Then

50:19

he also cited deterioration of economic conditions, which

50:21

I'm not so sure about. He said weather.

50:24

Weather geopolitics in the Middle East was

50:26

an issue. It was really bad. Kramer's

50:29

like, what if you just priced yourself out of the

50:31

market for what people want to spend? Well,

50:34

they did. They did. So I am

50:36

a Starbucks daily drinker. He said, despite

50:38

strong mobile and order pay and sales, we

50:40

saw a mid teens percent order in completion

50:43

rate within the order shown on this past

50:45

quarter. In other words, they're

50:48

using they're putting items into their cart and they

50:50

sometimes choose not to complete their order. Siding

50:52

long wait times. It's not wait times. It's

50:55

so expensive. I do. It's a

50:57

$9 coffee. It's so I just I just get

50:59

the dark roast. That's it. I'm

51:01

a very simple man. And I've started to,

51:03

you know what? I don't feel like spending $4

51:05

today. And I've started to make

51:07

coffee at home, which I would never not make or don't make. You

51:10

put that make out. Not not make out. But

51:12

it's just our question. Our question is, what is

51:14

your order at Starbucks? I'm a

51:17

venti cappuccino extra shot whole milk. You know,

51:19

slightly wet. So what do you spend? So

51:21

you're at 75. That's a $7. I

51:23

don't know. I don't know anything

51:25

about that. That's a $7 plus. That sounds

51:28

like a $7 handle. But I went from I went

51:31

from the devotee category

51:33

to the occasional category.

51:35

So I brought in an espresso machine, which is fantastic, by

51:38

the way. I was 365 days a year. And

51:42

I'm probably down to 320 and I'm definitely not unique.

51:44

Now you're an occasional customer. So you know, I'm

51:46

still 85% of days. But

51:49

is this a canary in the coal

51:51

mine for consumer spending and therefore the

51:53

entire Starbucks

51:55

issue. We could look at

51:57

the gas. Look at look at Chipotle. Look

52:00

at Dominos. All right, look at McDonald's. They said the same

52:02

thing. Yeah, but look at Texas Roadhouse. I'm

52:05

sorry. So I think at best, that's

52:07

a stretch. I think it's very idiosyncratic. Well, there's companies

52:10

on this side that are able to raise prices, and

52:12

people keep going, to probably be a great example. And

52:14

then there is McDonald's and Starbucks, and people are starting

52:16

to say, you know what? Because at

52:18

some point, with some of these

52:20

foods, like, if I'm going to spend $16 for this,

52:23

I'll either spend $20 or $25, or I'll just make it at home. Yeah.

52:28

When we look at

52:30

industry groups, we do it equal weight, so we eliminate

52:32

the Amazon effect, right? This is

52:34

a consumer discussion. Yeah. And when

52:36

we go through, for restaurants specifically, we'll look at

52:38

the Russell 3, because that way we get a

52:40

huge population. But they're all equal, right? So

52:43

we'll get a huge population. And the restaurants

52:46

in the Russell 3 are still in an uptrend. Restaurants in

52:48

the Russell 1 are still in an uptrend. I know it's

52:50

just one thought, but... Yeah, Texas Roadhouse. But there are... Well,

52:53

that doesn't... They have the lemon pepper. That

52:55

doesn't count. I mean, come on. No,

52:57

the point is, there are some restaurants that are

52:59

killing it, and some are getting killed. Shake

53:02

Shack had Unbelievable Earnings yesterday reported. Yeah, and

53:04

Shake Shack's not cheap. And the stock held

53:06

up, and they don't sell cheap shit. Yeah.

53:10

So I am more than

53:12

occasional visitor. He's in the loyalty program. They

53:14

don't even have a loyalty program. They don't

53:16

even have a loyalty program. The royalty program,

53:18

homes. All right. Can we do Apple? This

53:22

is the second largest publicly traded company on Earth,

53:24

right? Microsoft bigger now? So I actually feel like

53:26

for the first time in a while... But you

53:28

answered that because I would not have known what

53:30

the bigger one was. Microsoft's bigger. I'm pretty sure.

53:32

They oscillate. Is that the right... I

53:36

think that Apple is marching at the beat of its own

53:38

drum and off. The market doesn't need it anymore. Unless

53:42

they see something... I think you're right. Unless they

53:44

see something really horrific about the consumer.

53:46

True. Probably okay. But

53:49

I think that for the most part, the Apple story is

53:51

actually an Apple story and less of an overall consumer story.

53:53

Well, here's the story on Apple. We're

53:55

looking for literally negative 10% on

53:57

iPhone revenue. Which

54:00

is half the company's revenue. Nobody's expecting anything.

54:02

It's not great. Yeah services should be up.

54:04

It's the only growth business there Um,

54:07

not a great chart. We're gonna tell you not

54:09

a great chart Not a great chart and I

54:11

think uh, nvidia Has been

54:14

the primary beneficiary of money out of

54:16

apple Like I think it's literally

54:18

handing market cap not market share market

54:20

cap to uh to nvidia Um,

54:23

this is their fifth out of

54:25

the last six quarters of

54:27

sequential year-over-year Revenue

54:29

contraction. That's really rare.

54:31

Yeah, and It's

54:34

not even like selling at 16 times earnings. It's

54:36

like a 28 times earning story uh,

54:39

so the market might not need apple But

54:42

a really bad reaction in apple is gonna

54:44

and we're gonna notice it I

54:47

mean we're gonna run this show tomorrow. So I don't want

54:49

to like go crazy on prediction, but I

54:51

still think it's important Well, here's so chart up

54:53

there keep it. So I so the chart that

54:55

I just made is apple divided by q's This

54:57

is weekly. Yeah, so it's it stopped going down

54:59

relative to the q's over the last couple of

55:01

weeks But this could break hard tomorrow. Yeah,

55:04

or or not or it could bounce who knows

55:06

I mean, I would think it would bounce from

55:08

there, but not to change like so that's in

55:10

our views That's that's just that's just the apple

55:12

week Yeah, the reason the reason I should pull

55:14

up because it's Kind of

55:16

falling off our radar. I can tell you this that the

55:19

50 day cross through the 200 day about three

55:21

weeks ago Um, you

55:23

know just as a very simple definition of trend

55:26

um, and so it went from well, you

55:28

know Tech is leading tech

55:30

is leading to this is actually rolling over

55:32

and looks vulnerable. That's not good Yeah,

55:35

so I would I would actually expect that to

55:37

rally and i'm a seller of the rally tell

55:39

you what else happened We found out

55:41

in the middle of february that berkshire hathaway had trimmed

55:43

its apple position in q4 For

55:46

the I think for the first time since

55:48

they started to invest in it That's

55:50

a larger shareholder and that was

55:52

the buyer of Basically every share

55:54

that someone else sold either was

55:57

bought by the queues the company

55:59

buyback or And

56:01

that dynamic is now not I

56:03

mean, maybe they started buying it again. Yes your

56:06

point. Nobody is expecting That's

56:08

the good news and and they

56:10

also are probably not gonna have a great

56:12

number from China Which I

56:14

think the expectation is it's like negative

56:17

14% China sales and people are

56:19

paying attention to that now It's a really key market to them.

56:21

You know always scares me about technology Is

56:24

the old saying that in the long run

56:26

every technology company makes toasters? I

56:29

mean, I thought that would have been true with this

56:31

thing ten years ago. It was true with Blackberry is

56:34

true with Motorola It's like at some point It's

56:36

probably gonna be true right unless they catch up

56:38

and they can somehow figure it out and the

56:41

toaster companies never figured out services Our

56:43

software I get it there. There are

56:46

differences. I'm sure there will be a question.

56:48

Don't worry about I just worry about You

56:50

know it becomes so ingrained in who we

56:52

are and what we do well iPhones Not

56:54

growing but some right and and something else

56:56

comes along. Um, well, it's not the vision

56:58

Pro at least not I'm sure

57:01

that'll come up and it's just been it's just been

57:03

an absolute bomb. Can we look at your Can

57:05

we look at your bullish call in

57:07

December based on escape velocity? Looking

57:10

for 5,800 by year end sure and

57:12

then you have a thrust indicator

57:15

Confirmation here right? So tell us the story.

57:17

What are you telling when Matt clients right

57:19

now? So there's two there's two ways that

57:22

we think about momentum One

57:25

is through trend which is path of least resistance. Think

57:27

about trend is I spilled this Delicious

57:29

margarita on the table and somewhere it's gonna

57:31

end the call will kill you The

57:34

path of least resistance somewhere that margarita will end up on

57:36

the floor. So that's the trend Then

57:38

we think about rate of change and rate of

57:40

change is momentum how quickly what's the velocity of

57:43

this thing? And so if

57:45

you don't have trend in a market If

57:47

you just wait for trend the risk is we

57:49

all know it the risk is that you're gonna be late Not

57:51

that it's gonna be completely wrong It's just gonna be

57:53

not as you're not gonna be as invested as

57:56

quickly or selling as quickly as you

57:58

might otherwise be able to So momentum Momentum

58:00

helps you bridge that gap and say, okay,

58:02

look, between a bearish trend and a bull

58:04

market, is there something I can do to

58:06

get myself in a more

58:08

favorable position? And momentum is one of those

58:10

things that we find. So

58:13

this is internal momentum. This is exactly what

58:15

we talked about with the 20-day lows, except

58:17

these are 20-day highs. Right? Okay. So when

58:19

we look at 20-day highs, again, that 50%

58:21

number tends to be a good number. You

58:23

can see our little green arrows. You can

58:25

see the forward returns. Those forward returns are

58:27

generally better than not. Now, there's a couple

58:29

other stipulations we use with that.

58:32

But the punch line here was we're

58:34

coming off of an extreme sentiment condition

58:36

in October, and all of

58:39

a sudden, we punch 20-day highs into

58:41

about 71%. That's

58:44

obviously a huge number on this chart. But

58:47

I'll tell you, in the last, whatever

58:49

it is, 70 years, since 1957, that

58:53

has only happened 70% or better six times. Wow.

58:56

So it was a really, really

58:58

unusual, bullish example. The

59:01

three-month forward return, when we get sorry,

59:04

the 71% is the percentage of stocks

59:08

making a 20-day high on the S&P. On the

59:10

S&P. Correct. Okay. So

59:13

the three-month average returns, zero

59:15

times was the market down from that point,

59:18

the day after, not including that day, right?

59:20

That the close of that day. Zero

59:22

times is the market down. One

59:25

quarter out, the average return was 9%, which we got.

59:29

And this is essentially the end of the year,

59:31

so it's close enough. Six-month returns were 14%, which

59:33

we haven't seen yet, but that tells us

59:36

there's still some dry powder left in this

59:38

thing. And 12-month

59:40

returns are 22%. Again,

59:43

zero losses, right? So the average

59:45

is 22%. So obviously, some are a little higher, some are a

59:47

little lower. But we looked at that

59:49

along with the sentiment and just said, look, this is a pretty

59:52

unusual number. We don't get this

59:54

very often. And

59:57

this is going to catch people off guard. So

1:00:00

certainly for the first six months, we got to

1:00:02

maintain this bullish stance. If

1:00:04

things deteriorate or there's something that happens in between,

1:00:06

we can reassess it. But between now and then,

1:00:09

these numbers are just too powerful for us to

1:00:11

ignore and say, well, I think it's the Middle

1:00:13

East or coming up with some bullshit issues. And

1:00:15

this was you at the beginning or at the

1:00:17

end of last year? This was officially December 14th

1:00:19

of 2023. So

1:00:21

let me ask you a question though. So I

1:00:24

understand that and bread thrust and there's

1:00:27

a psychology behind that. Why

1:00:29

all of a sudden is everyone buying

1:00:31

all these stocks? It can't be bearish. I

1:00:33

agree. But you also mentioned before

1:00:36

that you look

1:00:38

for mean reversion. This is not

1:00:40

one of those things that you're looking for mean

1:00:42

reversion in. No. Okay. Why?

1:00:45

Well, the history tells us that, right? And

1:00:47

usually after you get this escape velocity or

1:00:49

these thrusts, there's an element of time that

1:00:52

develops before you end up with the reversionary

1:00:54

factors being a problem. Now we go back

1:00:56

to that rolling alpha that I talked about.

1:01:00

Right now in the rolling alpha, I don't know exactly where it

1:01:02

is. I'd say it's probably in the 70th percentile. We worry when

1:01:04

it gets in the 90th percentile.

1:01:06

So it's not the reversionary

1:01:08

factors that we concern ourselves with, which

1:01:10

are long-term, by the way. They

1:01:13

don't tend to be very, very short-term. They're

1:01:16

just not in a position that's overly

1:01:18

concerned. Okay. I like that. And

1:01:21

I think most people, when

1:01:23

they see a bread thrust, they have one

1:01:25

of two reactions. Either they don't

1:01:27

notice it or even think too much

1:01:29

about why it's happening, which I

1:01:31

think is why most people. But

1:01:33

then there are people that do notice it,

1:01:35

and they're usually under-invested. Like for

1:01:38

me, that's a signal for people to chase. Absolutely.

1:01:40

That's exactly right. And but- It's like you're

1:01:43

not in the game. But what

1:01:45

is people's reaction to that, which is usually,

1:01:47

it's up too much, it's overbought, so I'll

1:01:49

wait for a pullback. And then guess what?

1:01:52

It never comes. It never comes. The game

1:01:54

go away is bullshit. Better to

1:01:56

sell in July and say goodbye. I

1:01:58

haven't heard that one before. I've been around for a long

1:02:01

time. Boom. And then

1:02:03

there's some tie-ins presidential election

1:02:05

years. Let's throw this one up. You

1:02:08

mentioned before that May normally is the

1:02:10

bottom of the market for

1:02:12

presidential election years. I

1:02:14

have a lot of opinions about why I think this

1:02:16

time will be different. I

1:02:19

think most people do, but walk us through this chart.

1:02:21

This is a composite. Yeah. So back to 1928, you

1:02:24

got two lines here. The gray

1:02:26

line is seasonality in every

1:02:28

other year other than an election year.

1:02:30

Right. So the year after the interim

1:02:32

midterms and the year before and

1:02:35

this is a two-year chart by the way. So you get kind of a

1:02:37

census what's going on. The

1:02:39

red is just specifically election years

1:02:41

that yellow stain is the the

1:02:45

election week. Right. So that's one excellent choice

1:02:47

of words. I might have said bar. What

1:02:49

stain is that? Good. So

1:02:52

the red dot is where we are today.

1:02:55

You can see that typically we will

1:02:57

continue to weaken into the Memorial Day

1:02:59

holiday. But as people start chirping about

1:03:01

selling me and go away that actually

1:03:03

ends up in presidential years being the

1:03:05

bottom. Now a word of caution statistics.

1:03:08

This is obviously a fourth the sample

1:03:10

size of what you'd have otherwise. 1928

1:03:12

to 2024. So

1:03:15

it's 40 different election years,

1:03:18

roughly. Right. 40

1:03:20

different cycles in here. 25, right? No,

1:03:23

I don't know. 100 divided by 4. Oh, yeah. Okay.

1:03:26

All right. So all right. So this

1:03:28

so we have 25 years that this

1:03:31

is an amalgam of. Yes, correct. So,

1:03:33

you know, it's not terrible,

1:03:35

but you know, you can still drive a mid-sized

1:03:37

car through it. But it's interesting how different it

1:03:39

is from correct. And that's what really stands out

1:03:41

is that this point right here, you know, I

1:03:43

wouldn't tell you in other from the gray, but

1:03:46

the end up in the spot,

1:03:48

which is also equally as interesting, correct, which

1:03:50

means that we rip right in June, July.

1:03:53

Right. And that's the that's the risk. Let

1:03:55

me ask this. Does does any individual year

1:03:57

actually look like this? Uh,

1:04:01

that's a good question. Does any of the 25

1:04:03

instances? All right. Uh, I think you, I think

1:04:08

this is one of those years that if it's

1:04:10

going to be aberrant, it'll make sense in hindsight.

1:04:13

Of course, this didn't look like a typical election year.

1:04:16

There's a non-zero chance that we actually don't

1:04:18

have an outcome to this election. So

1:04:20

I mean, it's, I'm just saying like, this is kind

1:04:22

of where we are. Okay. I don't want to say

1:04:24

more on that. We did China, Michael, what else? Oh,

1:04:27

should we do this? Let's just, let's do some of these

1:04:29

charts. We spoke about this earlier, so

1:04:32

we could just work through this quickly, but some of these are

1:04:34

too good to pass up. Yeah, I agree. Okay. Uh,

1:04:37

so all right. First one is the

1:04:39

Shanghai Shenzhen 300. What are we looking

1:04:41

at here, Jeff? Well, that's a

1:04:43

downtrend, right? But it looks like it's changing.

1:04:46

And now when I want you to point,

1:04:50

uh, what I want to point out is look

1:04:52

at that off the low, right? Look at that

1:04:54

just almost straight up right through the, through the

1:04:56

50 day, which is that red line. Uh, wasn't

1:04:58

even there. Like it wasn't even there, right? I'm

1:05:00

going to wait for a pullback. No, this

1:05:05

chart is, this chart is saying that the

1:05:07

Yuan is going to be the world's new

1:05:09

reserve currency by the end of this year,

1:05:11

as we devolve into civil war and chaos.

1:05:14

I don't know. Uh, this is like, this

1:05:16

is a remarkable move. It's a good move,

1:05:18

but that's what we call an acceleration wall.

1:05:20

That's why momentum is important, right? Because if

1:05:22

we're waiting for the 50 day across to

1:05:24

the 200 day, we're still waiting, right? But

1:05:26

we have momentum. It gives us an early

1:05:29

peak that the high probability of a trend

1:05:31

change is the bottom pain. That's your proprietary

1:05:33

oscillator. But you know, this

1:05:36

is so hard. Clearly just by the naked

1:05:38

eyeball and it's a very sophisticated naked eyeball.

1:05:40

This looks like a trend change, but the

1:05:42

downtrend is so powerful. Like you,

1:05:45

would you be, rolls over. It looks

1:05:47

like there was a fake out in 22 in 22. Yeah. But we didn't have the negative

1:05:53

alpha, right? So you've got the setup, which

1:05:55

is you just had this relentless

1:05:58

pounding of negative return. And

1:06:00

so for every quarter every year that

1:06:02

goes on when you get these thrusts again,

1:06:05

we could be wrong But we'll be

1:06:07

wrong by this much and

1:06:09

if we're right, we're right. What is the Shenzhen

1:06:11

300 look like? like

1:06:15

sector-wise That's

1:06:17

not important I don't

1:06:19

know at all. Yeah, somebody was just asking me. I was

1:06:21

just in a meeting before and somebody asked me they said

1:06:23

look We get what you're

1:06:26

saying China important How

1:06:28

should I play it? I'm like, what do you

1:06:30

mean? How should I play? Well, what sector should

1:06:32

I own? I'm like, all right first and foremost.

1:06:34

Let's do this by the index Right when you

1:06:36

when you get a when you get a raging

1:06:38

bull coming off a low Don't dick around trying

1:06:41

to figure out what your you know I think

1:06:43

I'm so smart because whatever is the leadership group

1:06:45

is going to become the largest correct It's

1:06:47

gonna become the largest waiting in the index

1:06:49

anyway, right? So why only the only thing

1:06:51

that we found consistently if it's a new

1:06:54

bull phase is beta. That's it So sometimes

1:06:56

beta is energy. Sometimes it's not sometimes base

1:06:58

tech. Sometimes it's not just make sure you

1:07:00

have beta That's really what you want. So

1:07:02

to your point about this just being the

1:07:04

negative excess returns in China This

1:07:07

looks nothing like the previous other

1:07:09

failed break breakouts. It's just the

1:07:12

the downward movement and for the audience

1:07:14

Jeff, what are we looking at? So

1:07:16

the bottom pane is What's

1:07:20

the best way to put this this is looking at the

1:07:23

amount of return I'm getting per unit of

1:07:25

risk Versus the MSCI

1:07:28

World Index literally off the charts literally off

1:07:30

the charts at the downside. Right? So

1:07:32

I mean this is getting all the volatility that you

1:07:35

would get from every other stock market and that literally

1:07:37

never making money from it Right at this point you

1:07:39

married this with the sentiment which we got to in

1:07:41

a second You just have to say all right just

1:07:43

close your hold your nose and buy stuff. That's what

1:07:45

that is This is this is the you hold you

1:07:47

know any other charts in the world that look like

1:07:49

this some health care charts in the US

1:07:52

like Life

1:07:56

Science Tools, I'm kind of bullish on on

1:07:59

on that idea. Yeah, so I think

1:08:01

the Biden administration there was just a ton

1:08:03

of fear. About drug prices and you

1:08:05

know what the government was in a common to

1:08:07

do. He. Might not be the president

1:08:09

three months or six months or whatever. like.

1:08:12

I. Think there's some really great set up their side

1:08:14

way. What else a the else. I

1:08:16

would send the other side of the

1:08:18

ledger. Homebuilders. Are actually excessively

1:08:20

bullish. Returns to the point I

1:08:23

want to marry discuss Mcnamee the

1:08:25

same, but the. Return. Profile

1:08:27

Risk Just Return. Profile of the homebuilders

1:08:30

is almost exactly what was in two

1:08:32

thousand and Five. It's a sounds. Very.

1:08:35

Interesting about. I. Love I love

1:08:37

it was that's when you want to do

1:08:39

these. yes I'll flows ah at last Lee's

1:08:41

Summit celebrate yes it is. So this

1:08:43

is for the such noise you appalling money

1:08:46

out of what are the big Chinese

1:08:48

yes besides say well as or sized athletic

1:08:50

I do have as you forget about

1:08:52

the tech one right? So it's A shows

1:08:54

A people had essentially said why am

1:08:56

I target why it went away on these

1:08:58

when invidious going up everyday eat or

1:09:00

how much nicer allocators answering clients and it's

1:09:03

like absurd. Why perfect. How long could

1:09:05

you go on descending. That he and right

1:09:07

right? Okay, I love, I love the idea of

1:09:09

what the crisis Dude, I've heard this year or

1:09:11

not I don't care for I say the same

1:09:13

thing. I'm tired of your convictions like about Ah

1:09:15

John. from a good the metal sort of. So.

1:09:18

There is a correlation between China and and

1:09:20

battles. It's like one of those things that

1:09:23

have that I. And. He doctor

1:09:25

copper when I do that. but like

1:09:27

it really matters a lot to serve

1:09:29

for the medals, right? Pittance intuit. Okay

1:09:31

so what's going on here specifically the

1:09:34

red wine is the or the relationship

1:09:36

the relative performance of copper vs. gold

1:09:38

rights. The idea is our industrial metals

1:09:41

outperforming monetary dc.org Chart yell jeb So

1:09:43

this is moving higher. It's you'd wanna

1:09:45

see this confirming with a move and

1:09:47

in China it is. So it's It's

1:09:50

just gives us a little more comfort

1:09:52

that what's happening in China. Isn't

1:09:54

just an aberration, but it has some fundamental

1:09:56

discipline? Or Jeff? Is there a chance that

1:09:59

this is the. tail wagging the dog and

1:10:01

people see Chinese stocks rally and they reach

1:10:03

for the more leverage way to play it,

1:10:05

which is copper. Maybe,

1:10:08

but I don't know if you have all the charts in

1:10:10

here, but it's happening in aluminum. It's happening in gold.

1:10:12

It's too broad. It's too broad for that to be manipulated.

1:10:15

I would buy that correlation. That makes sense to me. Yen

1:10:19

depreciation drawing attention. Yeah,

1:10:22

I saw people chirping about this. I mean, this is as

1:10:24

long as I've been in the business. Japan,

1:10:26

all they ever do is intervention.

1:10:29

Why is this a story now, do you think? Well,

1:10:33

because you've got yield curve control, right? So now they

1:10:35

have to kind of, they have to

1:10:37

decide, are they willing to let

1:10:39

the tightness be reflected, the

1:10:41

normalization of the yield curve be reflected

1:10:44

in the currency, which chokes off the

1:10:46

recovery, or do they want to keep

1:10:48

the currency in a competitive

1:10:50

landscape without being. They

1:10:52

have positive real yields on JGBs now

1:10:55

or close? I

1:10:57

think it's right there. Okay. So they

1:10:59

have a stock market at 33 year highs. So

1:11:03

what is this about from their perspective? It's

1:11:06

a good question. I'm not exactly sure what the

1:11:09

angst is, but I mean, it's

1:11:11

a bad chart. Does

1:11:13

this look like a reversal to you or way too soon to tell? That's

1:11:16

a bounce and a downtrend. So when that gets

1:11:18

overbought, that's absolutely simple. You've

1:11:22

got a lot of work to do to take that and

1:11:24

reverse that. So

1:11:27

you guys in late February, so you

1:11:29

mentioned the momentum names just got too

1:11:31

hot. The

1:11:34

stove is now burning whatever you put

1:11:36

on the- Not only that, but you

1:11:39

had the momentum differential, right? The

1:11:41

high momentum names versus low momentum

1:11:43

names. That differential was extreme. But

1:11:46

you also in the option market started to

1:11:48

see that the pricing

1:11:50

of upside was higher to

1:11:54

get the, to capture the

1:11:56

upside than it was to protect the down. That's backwards.

1:11:59

I remember reading. I remember reading this note

1:12:01

and not fully understanding the chart that you

1:12:03

included in it. So

1:12:05

maybe I can ask you why I got confused. This is the

1:12:07

Russell 1000 Momentum Q1

1:12:10

through Q5 performance. These are core

1:12:12

tiles within the Russell or?

1:12:15

Yeah, so you take the top 200 names, right? That are the

1:12:17

best performers over the last 12 months. Okay. You

1:12:20

take the worst 200 names and you just pair them off

1:12:22

against each other. Okay. And

1:12:24

that spread, we then because that spread was about

1:12:26

14%. So that's the thing that you're saying was

1:12:28

extreme. That's 200 versus the worst

1:12:30

200. Correct. Okay. So

1:12:33

why is that important to you? Because at those extremes,

1:12:35

it usually means that people have crowded into momentum

1:12:37

and that's the point where it's unsustainable. Okay,

1:12:39

got it. So where are we now? So we

1:12:41

went from the 96th percentile to the 81st

1:12:44

percentile. Historically, you will take it

1:12:46

at least back to the 50th percentile. You have to

1:12:48

go to the 10th. So when you do see that

1:12:50

in the 50th percentile, is that your

1:12:52

signal on a contrarian basis to say, I'm interested

1:12:54

in momentum again? No, not yet. Okay,

1:12:57

that's not what that means. No, it just says

1:12:59

it's just not the fact the factor, the factor

1:13:01

excesses have gone away and it's probably moved on

1:13:04

to something else quality. I think it moves on

1:13:06

to beta, but that's a lot of any of

1:13:08

the momentum stock ETFs or any of those meaningful

1:13:10

to your work. I don't follow them because everybody

1:13:13

has a different definition. When the momentum wanes

1:13:15

like this and it goes from the

1:13:18

90th to the 50th or whatever it is, are those no

1:13:20

longer momentum stocks? I don't think it reset. We

1:13:24

do it every quarter. So yeah, they can reset,

1:13:26

but really what you're seeing is, and I think

1:13:28

that's one of the reasons that you're seeing this

1:13:31

recent pickup in utilities, this recent

1:13:33

pickup in staples, is that they

1:13:35

were in the bottom 20%. So

1:13:38

as the high flyers

1:13:40

correct, the caterpillars that you showed and

1:13:42

the invidious, you've had Duke

1:13:45

energy breakout. You've had some

1:13:47

of these other procter and

1:13:49

gambles broken out. We have three of them breaking out.

1:13:52

We have consumer status. So

1:13:54

we keep our own list of

1:13:56

the best stocks in the market, predominantly based

1:13:58

on how they're acting. fundamentally

1:14:01

good. There's

1:14:03

24 left on the list and

1:14:05

I think half of them are utilities and staples. Jeff,

1:14:08

you're left. Such is another of my

1:14:10

trading hilarious stories. So I bought XLU

1:14:13

right near the bottom when it was going to puke and

1:14:15

the spread between XLU and SPY was at

1:14:17

an extreme. And I got annoyed

1:14:19

and frustrated and I sold it right over there. You

1:14:24

want him to put a bandaid on that? I

1:14:27

don't know. What do you want him to

1:14:29

do with Matt? My situation. You know what?

1:14:31

You know what works? Tequila works to kill

1:14:34

Matt. Hey, semiconductors, another call that you got

1:14:36

right. In early March of 24, you cited

1:14:40

the Momentum excess there. AMD reported

1:14:43

this week and I don't want

1:14:45

to say blew up, but negative

1:14:48

reaction. We've seen Intel

1:14:51

have a rough time. We went

1:14:54

from a situation where every name in the

1:14:56

SMH was up huge. Now it's gotten more

1:14:58

selective. Do you think that'll continue? I

1:15:01

absolutely think it will continue. This is the

1:15:03

excess returns. The exact same thing I showed

1:15:05

you with China. This

1:15:07

is just for semiconductors. There's

1:15:09

an old saying, price to

1:15:13

perfection. This is quantifying that. All we're

1:15:15

doing instead of somebody just shooting the

1:15:18

breeze and saying it, we're putting this to numbers.

1:15:20

And what this is saying is, look, if

1:15:23

you believe trees grow to the sky, then no problem. This

1:15:25

is going to work. But the idea is that once you're

1:15:27

up here, what you're really

1:15:30

asking is that every unit of

1:15:32

return per unit of

1:15:34

risk is going to continue at this torrid pace. And

1:15:36

we just don't see it that way. It

1:15:39

never happens. It can be as perfect as

1:15:42

the semiconductor trade had been for

1:15:44

a very long time. And I think

1:15:46

what's important, Josh, is that's not a

1:15:49

repudiation of AI. That's not how that's

1:15:52

going to change the world. None of

1:15:54

that has anything to do with this,

1:15:56

right? This has to do with people

1:15:58

looking at that narrative. and

1:16:01

extrapolating it into the ionosphere.

1:16:04

So let me redeem myself. I sold AMD 185 for the layout.

1:16:07

There we are. There we are. There we

1:16:09

go. It's too steep. Semi's

1:16:12

and semiconductor equipment option score. What's

1:16:15

in here? So that's exactly what we're talking

1:16:17

about. Yes, that's when we're talking about the

1:16:19

upside being priced versus the downside. That's

1:16:22

the extreme. So you want both the momentum

1:16:25

and the extremes in the pricing. Let's do

1:16:27

this last chart. We'll do Nvidia. How

1:16:31

about a chart? No, I'm kidding. This

1:16:33

is like, in my view, what

1:16:36

Nvidia has undergone in the

1:16:38

last three years is probably

1:16:40

one of the most magnificent

1:16:43

stories ever for growth

1:16:45

stocks. So it says nothing about where the

1:16:47

stocks can go from here, but just like we

1:16:49

really have not had a lot of Nvidia's throughout

1:16:52

the course of stock market history. It's

1:16:54

a really special and unique situation. A

1:16:57

lot of things make it that unique and that special.

1:17:00

I do think that there got to a point in

1:17:02

February, March, where if you were

1:17:04

a professional money manager and you

1:17:07

called yourself a growth manager and you didn't have

1:17:09

an allocation to Nvidia, you look

1:17:11

like an insane person, basically. There's like

1:17:14

career risk times 10 on

1:17:16

something like that. Because not only

1:17:18

was it such an amazing performer, it

1:17:20

became the fifth largest stock in the country. So

1:17:23

not owning it was not just underweighting it,

1:17:25

but really putting your career in jeopardy. You're

1:17:27

afraid of the trend. Okay, so that's probably

1:17:30

what drove the rest of the semiconductors quite

1:17:32

frankly. Sure, absolutely. Where are we now? Well,

1:17:35

so this is, I put this up because

1:17:37

this is specifically that

1:17:39

option score that we talked about, right? So

1:17:41

those red arrows are pointing, look, it happened

1:17:44

back in July of 23 too,

1:17:46

right? So this is

1:17:48

the point where the option pricing is

1:17:50

more aggressive for upside exposure than it

1:17:52

is to downside exposure. So

1:17:55

people buying calls are paying higher and higher

1:17:57

premiums. They're worried about the upside. They're worried

1:17:59

about the... It's about not catching the upside. Let's

1:18:02

say the stock is at 100. I

1:18:06

can buy a call for at 120. I

1:18:08

can buy a call for $5. That

1:18:11

same put at $80, so

1:18:13

same delta spread away, is

1:18:16

at say $10. The

1:18:19

cost of insurance is lower

1:18:22

than the cost of capturing the

1:18:24

upside. That's crazy. It's crazy. Yeah.

1:18:28

I'm going to go crazy at the time. That's the bell. That's

1:18:30

us where we just say, look. Again,

1:18:32

if we look 12 months out, I can't tell

1:18:34

you that it's worse or better. It's about the

1:18:36

same. If I look three months out, it is

1:18:39

definitively worse. If I look out six months, it's

1:18:41

kind of, yay. What you do,

1:18:43

in our view, you wait for when you have

1:18:45

that, you take that back to either at best,

1:18:47

you take it back to a market weight, but

1:18:49

you probably underweight it. There are different option strategies

1:18:51

you can employ to try to capture

1:18:54

that differential. You wait for

1:18:56

an oversold condition to develop, and you use that because

1:18:58

it's still within an uptrend to say, okay, this is

1:19:00

my chance to now step into this because it's still

1:19:02

within trend. We've burned off some of

1:19:04

the success sentiment. I still want to own the stock.

1:19:06

This is my opportunity. There is a universe where this stock

1:19:09

has to be 1,000 just because it feels

1:19:11

like it's a magnet pulling it there. That's

1:19:15

not extreme. It's an $850 stock. $85

1:19:18

stocks go to 100 all the time. If

1:19:21

this had done a 10th to 1 split, and

1:19:23

we're trading at 85 right now, nobody

1:19:26

would seriously say it can't get to 100. For

1:19:30

some reason, 1,000 both seems like it's

1:19:32

a magnet, but also seems like it's

1:19:34

going to be a ceiling. So

1:19:36

I don't know. So you're a micro to the same

1:19:38

thing, right? Yes. I don't really

1:19:40

know what to do with this, but I know

1:19:43

it's the most vexing stock in the market right

1:19:45

now, both for bulls and for bears. You're

1:19:47

closer to the oversold condition, which was a buy. That was

1:19:50

maybe a week ago. We

1:19:54

think it will still in trend. That's

1:19:56

the good news. If you're a long-term holder,

1:19:58

I think you're still fine. I would worry

1:20:00

and I would actually take action

1:20:02

and reduce the positions. Um,

1:20:05

if you broke under the low that we had, whatever that

1:20:07

was two weeks ago. So what was that? I can't

1:20:09

remember the number 20. Yeah. It's probably, I

1:20:13

don't think it had a seven 50. Oh, it got

1:20:15

that low. What was that? Was that, Oh, I was

1:20:17

on vacation. That was cause Taiwan sent me, uh, today

1:20:20

warning or they, I'm glad I didn't notice, but

1:20:23

it didn't last. It was there for a day. No, it

1:20:25

was, it was rolling over and then that hard break and then

1:20:27

it immediately recovered. So that was that hard break was one of

1:20:29

those days where 20 day, 20 day

1:20:31

low spiked and video recaptured. I'm just eyeballing 50% of

1:20:34

the loss. So is that the

1:20:36

individual stock chart people ask you the most

1:20:38

about or Tesla? Oh, in video,

1:20:41

in video more so than Tesla. I think they

1:20:43

probably know what you're going to say on Tesla.

1:20:46

Yeah, I think that's probably true. That's probably fair. Right.

1:20:48

Okay. So, but we've also, we've also been talking about

1:20:50

Nvidia, right? So we were cautious on it three months

1:20:52

ago. So now they're kind of like, what have you

1:20:55

done for me lately? Where, you know, where are we?

1:20:57

How do we think about that? So Jeff, you've

1:20:59

been, you've been really right on a lot of key things

1:21:01

in this market. What is something that we didn't ask you

1:21:03

about that you think is going to be important in the

1:21:05

second half of the year? No doubt about it. And I've

1:21:07

not been, um, I've not been

1:21:10

as sharp on yields. Okay. Um, I

1:21:12

would have expected yields to be flat,

1:21:14

not up flat to down, frankly, what

1:21:16

10 year yields. Yeah. Um, if

1:21:20

we break through 5%, you know, our, our

1:21:24

bullish leanings are not going to be great.

1:21:26

That's going to change your opinion on stocks.

1:21:29

The market will change our opinion. I'm sure the market

1:21:31

will do it itself. But I think the risk where

1:21:33

we are right now, when we look at our yield

1:21:35

impact model and we look at some of the things

1:21:37

that historically, um, would be a detriment, because keep in

1:21:40

mind, the 10 year yield

1:21:42

drives valuation too, right? So the higher

1:21:44

that goes, the more the valuation, uh,

1:21:47

pinch starts to hit. Why is

1:21:49

5% the number? Because that round

1:21:51

number, that's it. Yeah. That's

1:21:53

it. What do you mean the old high

1:21:55

from 18? Yeah. From November. Oh, the old

1:21:57

high. It's not getting to 5%. Yeah. think

1:22:00

it is either famous last words wait why

1:22:02

not old enough to remember when 3%

1:22:05

was gonna I'm half kidding I'm half kidding it just first

1:22:07

of all looks like it looks technically it looks like a

1:22:09

top you know better than I Jeff but based on based

1:22:12

on Powell's testimony yesterday the the

1:22:15

the risk that they're going to do another hike it's

1:22:18

over you would have to see a significant upside

1:22:21

surprise in inflation and I think that's

1:22:23

unlikely but if you have the

1:22:25

so the risk to that is that if you

1:22:27

don't if you don't take care of

1:22:30

inflation soon enough and I I'm with

1:22:32

you I agree with that but if you

1:22:34

don't take care of inflation quickly

1:22:37

enough then and growth is

1:22:39

strong enough then you can support

1:22:41

those higher yields right that's that's the risk

1:22:43

what you they're walking a

1:22:45

very very fine line here because you

1:22:48

want to push yields to the point where you actually break

1:22:50

that lower but you don't want to push this into recession

1:22:52

right so you want to break that lower that then

1:22:55

allows you right you take the yields to 4% but

1:22:57

that allows you to cut

1:22:59

rates by 150 basis

1:23:01

points on the short end and then you normalize the curve

1:23:03

and things are back to money in the bank to the

1:23:05

Fed yes okay so when I give opinions I'm a betting

1:23:08

man so I like to sort of quantify what I'm at

1:23:10

I don't think that when I say I don't think the

1:23:12

10 years you want to 500 5%

1:23:14

if I needed odds making this up if

1:23:16

I needed odds like what would it take

1:23:18

to get me to bet on 5% I'd

1:23:20

say like plus 275

1:23:23

something like that that's not about fair from

1:23:25

the guy with the Nick shirt on sure yeah that's

1:23:27

all right yeah I'm with you

1:23:31

yeah yeah just a graph ladies and gentlemen you

1:23:33

have fun on the show it's great why

1:23:36

haven't you been back all this time is it my fault

1:23:38

we can't let this we

1:23:42

can't let this length of time lapse in

1:23:44

between your appearances you're you're too

1:23:47

informative for us I'll come

1:23:49

for Cinco de Mayo and I want to the holiday you know

1:23:53

your Christmas fair across the street who made the marks

1:23:55

you are Eric Eric by pouring

1:23:57

in the 1800 Margarita mix into

1:24:00

the cooler that we bought at CBS in

1:24:02

aisle nine. Okay, wait what's the tequila

1:24:04

in here? Oh,

1:24:06

this is 1800. Where

1:24:08

did the mix come from? It's like powdered mix?

1:24:11

No, no. Oh, like

1:24:13

the bottle. Well, it's delicious. Straight from Mexico. Straight

1:24:15

from Mexico. It's getting the job done. This is

1:24:17

what's important. Let's do favorites. You got music for

1:24:19

us? What do you got? You. Me?

1:24:23

What are you talking about? I have something here. Go ahead.

1:24:26

No, you. Oh, the favorites. You

1:24:29

were fast about my books or whatever

1:24:32

and I said, you know, the one

1:24:34

that really jumped out to me this

1:24:36

week was fried chicken and evil

1:24:38

women. That sounds like it's a country song. Do

1:24:40

I have that right? It's not going to win any Grammys, but I think the title

1:24:43

should. Whose song is that? I don't even

1:24:45

know. I just saw it. Oh,

1:24:47

who's the country? Are you a country music guy? You

1:24:50

know, I have to say I

1:24:52

am. That's a

1:24:55

yes. So am I. I saw

1:24:58

what's his name? Luke

1:25:01

Brian. Yeah. No,

1:25:03

Zach Brian. Zach Brian. In Long Island, like

1:25:05

two weeks ago or whatever. He played UBS.

1:25:08

Yeah, but he also played the old Coliseum.

1:25:11

Oh, he did? Yeah. Okay. It

1:25:13

was one of the best shows I've ever seen. Tyler Childers on that?

1:25:15

No, he was not on that show. Who else was on that bill?

1:25:17

I just saw him in Tennessee. Okay. I

1:25:19

saw him with Winchester, 49 Winchester. Okay. Fantastic.

1:25:23

They were an opening act. They will not be an opening act for

1:25:25

long. Oh, really? Yeah. That's pretty good. Okay.

1:25:29

49 Winchester. So did you hear the, did

1:25:31

you hear the country song that remakes the rap song tipsy?

1:25:34

Did you hear that yet? No, that's

1:25:36

like one of the top songs on the country

1:25:39

charts right now. I think it might be the

1:25:41

only case ever of

1:25:43

country artists doing a remix, a

1:25:45

remake of a rap song, but

1:25:48

it's like pretty good. Like I don't hate it. I

1:25:50

thought I would hate it, but it's not bad. All

1:25:52

right. So we have a song from the show, or if you have

1:25:54

it here, Gin and Juice

1:25:57

by the Gourds. Oh yeah, I've heard that. Okay.

1:26:00

That's good. That's a good call back

1:26:02

unbelievable My song title reminds me of

1:26:04

fried neckbones and some home fries by

1:26:06

Santana. All right. Yeah I don't

1:26:08

know that one but the song is better than this song

1:26:10

But it's fried chicken and evil women

1:26:12

about exactly what you think it's about I

1:26:15

just caught the I just caught the course. I really

1:26:17

couldn't catch the rest of it adding to Spotify Michael

1:26:19

you got a favorite for us. I rewatched for the

1:26:21

first time since I saw it originally 10 years ago

1:26:24

John Wick, I was at a 10 year

1:26:26

old movie already. That's what goes fast. That's

1:26:28

wild You know, I can honestly believe my

1:26:30

neighbors are like ready to kill me. They're

1:26:32

like, what do you mean? You've never watched

1:26:35

a John Wick movie. I'm like I had

1:26:37

it. Well, how did how did you escape it? I don't know You've

1:26:41

never seen it either. Of course. Oh, I know I've

1:26:43

never seen it's phenomenal I've heard great

1:26:45

things and I have no idea how I've not seen it What

1:26:47

did you pick up this time that you forgot it from the

1:26:49

first time you saw it? Oh, I'm sorry.

1:26:51

Yes, because I was I was working while I was

1:26:53

watching so his background as background movie All right, but

1:26:55

but you but you loved having it in the back.

1:26:58

Love it. Okay, if you want to

1:27:00

watch something in the foreground I'm gonna recommend

1:27:02

Ripley on Netflix. Mmm. It's

1:27:04

black and white. All right, classy.

1:27:06

Yeah, right Did

1:27:08

you see the movie the talented mr.

1:27:10

Ripley? Okay, how good was that movie

1:27:12

by the way fantastic? Okay that that

1:27:14

thing Philip Seymour Hoffman. Come on, right

1:27:16

shows up. He steals the movie. Yeah

1:27:19

eats up every scene He's in Gwyneth

1:27:21

Paltrow. Yeah, Matt Damon So this

1:27:23

is based that was based on a book. They

1:27:26

went back to the book as source materials This is not

1:27:28

a remake of the movie. They made

1:27:30

a television series for Netflix

1:27:32

just now where They

1:27:35

go back to the book and they flush

1:27:37

it out a little bit more and so it's

1:27:39

like I think it's eight episodes Yeah, and

1:27:42

it's incredible could tell he shot on location

1:27:44

by size this right? Yeah The

1:27:47

scenery is amazing. The cinematography is amazing. Did

1:27:49

you did you watch it yet? I'm

1:27:51

one episode in I'm liking it It's pretty cool. Right?

1:27:53

Yeah. I like it. Why does it seem like it's

1:27:55

so special the way it was shot? What is it?

1:27:57

What is it about that? Well,

1:28:00

I think it's Elswit, a famous cinematographer

1:28:02

who has done a lot of beautiful,

1:28:05

beautiful films. Why do you think they chose to

1:28:07

film it in black and white? Because it takes place

1:28:09

in the fifties and they wanted to- A noir kind

1:28:11

of feel, I think. Oh, it's a film noir feel.

1:28:13

Yeah. Okay. I think

1:28:15

it's gonna get really good. I'm in episode three, but

1:28:18

it's like the pace is speeding up as

1:28:20

you go. It's like one of those shows. Is

1:28:22

the actor or the cast anybody you know? Who's

1:28:25

in the show? Nobody. They're

1:28:27

all unknown. Yeah, I don't know though. You

1:28:30

know what? You know why that's smart? Because how do you

1:28:32

recast that? The movie was full. That's true. That's a good

1:28:34

point. So what, like, are you gonna put three new movie

1:28:36

stars in it? Do you have the same, like,

1:28:39

is the Philip Seymour Hoffman character there? Nothing like

1:28:41

him. Okay. Yes, he's in it. Yeah. But

1:28:44

it's, again, they didn't remake the movie. They went back

1:28:46

to the book. Got it. So whatever

1:28:48

the artistic choices were behind the movie

1:28:51

were thrown out and it's

1:28:53

like somebody starting fresh with the original source

1:28:55

material. Yeah. I think it's really well

1:28:57

done and I like that it's not somebody trying to be

1:28:59

Matt Damon. That'd be hard to do. We put it

1:29:01

in the damn hard to do. But

1:29:04

you see a movie, right? A good movie. And

1:29:06

then you read the source material where

1:29:08

they clearly took artistic license. Yeah. Now

1:29:11

you're making another film, or not a

1:29:13

film, but a series. Yeah. That doesn't

1:29:15

want to replicate the movie but it's coming from the same

1:29:17

source material. It's really hard. I wanted it to be good.

1:29:19

But you have to let a lot of time pass. Yeah,

1:29:22

that's fair. Let's face it, like Jude Law is one of one.

1:29:25

Matt Damon is one of one. Like you're not

1:29:27

going to get an actor who does their best

1:29:30

Jude Law impression. Right. So I

1:29:32

like the choices they made with this. If

1:29:34

you've never seen that movie, you'll enjoy this. And

1:29:36

if you saw the movie last week, you'll still

1:29:38

enjoy this. Nice. So

1:29:41

I thought it was very well done. So everyone check

1:29:43

out Ripley. Okay, that's it from us this week. I

1:29:46

want to thank everybody that joined us in LA once again.

1:29:49

When are we going to have that out? Do we know? Did

1:29:51

we put a time on that? Go

1:29:54

ahead. Monday. Monday. I

1:29:57

think we're breaking into two though. Just so we'll have

1:29:59

to see. how it comes together in post. We'll

1:30:01

do it in post. Because we had two guests on it.

1:30:03

Bellamy Forrest, Time Sensitive? Yeah, we'll see. You guys will figure

1:30:05

that out. All right, so

1:30:07

shout to the listeners and the viewers. Thank

1:30:10

you guys for checking us out all week.

1:30:13

Special thanks to Jeff DeGraff

1:30:15

of RenMac. Where can people

1:30:17

learn more about Renaissance Macro? Well,

1:30:19

you can follow us on Twitter, which is

1:30:22

RenMac LLC, or at RenMac LLC. I can

1:30:24

go to our website, and

1:30:26

we have a podcast every Friday, which you can

1:30:28

pick up on. The Twitter account

1:30:30

as well. Podcast listeners,

1:30:33

listen to the RenMac podcast.

1:30:36

The newsletter is

1:30:38

go.renmac.com slash newsletter.

1:30:42

So if you want more insights from Jeff and the

1:30:44

gang, that's where you're going to get them from. We

1:30:47

appreciate all your amazing charts and

1:30:49

all your time today. Thank you so much for coming by

1:30:51

Hang with Us. Guys, it was fun. Thanks

1:30:53

for having me. All right, take us out.