Markets: Trump, Kudlow, Tariffs

What is Larry Kudlow done most of his life? He's been a TV personality like Trump. Yes he has worked at Bear Sterns for a while but most people know him from CNBC as a commentator and he has a lot of connections, he's regarded on Wall Street and I think this is the president trying to make that overture. This is all about show remember he's a showman.

I think that Kudlow is ultimately going to come out in support of whatever tariffs the president wants to adopt. Maybe they'll pretend that Kudlow had some influence on maybe targeting the tariffs in the right direction. Nothing has changed simply because Larry Kudlow has been has been nominated. It simply to me indicates a kind of a smart move on the part of the President given the agenda that he wants to pursue.

Markets: US Dollar, Gold

Even with today's bad economic data even with the downward revision by the Atlanta Fed the US Dollar was up slightly today. Gold was flat, it didn't really go anywhere. Nobody really perceives what's going to happen.

Retail Sales: Down 3 Months In A Row

Instead of getting a rebound we got another drop, we got another point one percent decline in February. That's a trifecta, that's three months in a row of falling retail sales. That hasn't happened in six years, I mean this is pretty rare. If you're like me and you've been very skeptical of the economy being good this is a validation because Americans are broke!

Bitcoin Is Nothing Like Gold

Bitcoin is nothing like gold despite the fact that you have all this terminology that was deliberately used to make it sound like gold. You mine Bitcoin, right? No,  there's no mines, there's no pitchforks there's nobody out there, there's no mine right? But you create them but they said it's mining and there's miners to make it sound like gold. They make the Bitcoin look like gold, it's color it looks like a coin made of gold. That's done for a reason. To create the false impression that you're buying something like gold.

Bitcoin: We've Seen The Peak In The Bubble Already

The bigger story is gonna be the money that's lost. There's gonna be so many people that are gonna lose a tremendous amount of money in these crypto currencies. There's a pretty good chance that we've seen the peak in the bubble already.

Bitcoin: I Don't Think It's Going To Work

I don't think it's going to work and people say well you just don't understand it. I think I do understand it, I think the reason that so many people are involved in it is because they don't understand it. Now, a lot of those people have made quite a bit of money by not understanding it because they bought it a long time ago and greater fools paid even higher prices and people can confuse that success with understanding.

Manufacturing Jobs Will Be Lost As A Result Of These Tariffs

Trump is right, the trade deficit is a problem but where Trump is wrong is thinking that these tariffs are going to solve the problem. They won't. They will make the problem worse. 

This is the irony of these tariffs. They will result in larger trade deficits not smaller trade deficits and that's even without any foreign retaliation meaning if China, if Europe, if our trading partners do nothing in response to these tariffs the result will be larger not smaller deficits. And manufacturing jobs, the very jobs that Trump is hoping to save, manufacturing jobs will be lost as a result of these tariffs.

The Beginning Of A Much Bigger Downturn

In February's big decline the Dow Jones Industrials Index (DJIA) dropped better than a thousand points on the month and we'll see if this is the beginning of a much bigger downturn. In fact it could easily be the beginning of a bear market.

Related trading instruments: 

• SPDR S&P 500 Index ETF (SPY)
• SPDR Dow Jones Industrial Average ETF (DIA)
• Nasdaq 100 Index ETF (QQQ)
• iShares Russell 2000 Index ETF (IWM)

How Much Longer Powell Can Pretend All Is Well?

A soaring budget and trade deficits, rising interest rates, higher inflation, a falling U.S. Dollar, protectionist tariffs, a looming trade war, and a slowing economy all portend lower corporate earnings and a bear market in stocks. Let's see how much longer Powell can pretend all is well.

Related trading instruments: 

• SPDR Dow Jones Industrial Average ETF (DIA)
• Nasdaq 100 Index ETF (QQQ)
• SPDR S&P 500 Index ETF (SPY)
• United States Steel Corporation (X)

The Dow's Record Breaking Monthly Winning Streak Has Come To An End

The Dow Jones Industrials Index (DJIA) was down 380 points today. In fact this is the second consecutive 300 point drop we've had in the Dow you know the Dow now is down about 4% for the month of February which just came to an end today and that also means the Dow's record-breaking monthly winning streak has also come to an end remember the Dow has been up every month since Donald Trump was elected president including every single month in calendar year 2017 that is something that has never happened in the history of the stock market.

Related trading instruments: 

• SPDR Dow Jones Industrial Average ETF (DIA)
• iShares Russell 2000 Index ETF (IWM)
• SPDR S&P 500 Index ETF (SPY)
• Nasdaq 100 Index ETF (QQQ)

Interest Rates Are Going a Lot Higher

Related trading instruments: 

• iShares Barclays 20+ Year Treasury Bond ETF (TLT)
• 10- year U.S. Treasuries, SPDR S&P 500 Index ETF (SPY)
• SPDR Dow Jones Industrial Average ETF (DIA)
• iShares Russell 2000 Index ETF (IWM)
• Nasdaq 100 Index ETF (QQQ)

Gold Needs To Clear Overhead Resistance

We got above $1350 last week but we couldn't hold it. I think we really need to go above $1400 to really clear away this overhead resistance the only trend that really continued was the bond market continuing to go down it's pretty much a daily affair.

Related trading instruments: 

• Market Vectors Gold Miners ETF (GDX)
• Market Vectors Junior Gold Miners ETF (GDXJ)
• iShares Silver ETF (SLV)
• SPDR Gold Trust ETF (GLD)

Stock Market: The Dance That We're Doing

Why didn't the stock market follow the bond market down? Of course it's because the stock market didn't follow the bond market down that the bond market kept falling and if the stock market doesn't fall then the bond market will keep falling and interest rates will keep rising until it does (make the stock market go down), that is the dance that we're doing.

Related trading instruments: 

• SPDR S&P 500 Index ETF (SPY)
• Nasdaq 100 Index ETF (QQQ)
• SPDR Dow Jones Industrial Average ETF (DIA)

Inflation Is Good For Gold

A $12 decline (in gold prices) turned into a $25 rally what is that showing that as the idiot morons robotic sellers when they see higher than expected inflation sell the dollar people who use their brains are starting to dip to think and actually come into the market and say wait a minute I don't care what these algorithms or computer programs say inflation is good for gold.

Related trading instruments: 

• SPDR Gold Trust ETF (GLD)
• Market Vectors Gold Miners ETF (GDX)
• Market Vectors Junior Gold Miners ETF (GDXJ)

The Democrats Now Look Like The Fiscally Responsible Party

The Republicans have now succeeded in doing something that you would have thought was impossible. They are making the Democrats look like the fiscally responsible party.

The US Dollar Will Continue To Get Slaughtered

The US Dollar is going to get slaughtered a lot more and the bond market is going to get slaughter a lot more in the days ahead. Maybe not exactly tomorrow but they're going to be days that are going to come that are going to be much worse than today. This is just the beginning this is the tip of a huge iceberg that is going to be developing.

Stock Market: Bear Market or Correction?

Looking at the fundamentals this looks so much more like a bear market. In fact, when you listen to the talking heads on CNBC they keep saying, "relax don't worry you know this is a correction the market is long overdue for correction, we haven't had a correction in a long time and corrections are normal and they're healthy." And all that is true but you know we also haven't had a bear market in a long time and bear markets happen,  bear markets are normal so how do they know that we're having now is not the long overdue bear market?

Massive Volatility Is Indicative Of A Trend Change

We're continuing massive volatility which is I said to me is indicative of a change of trend because we were so long in an uptrend with no volatility now all of a sudden you have this massive volatility.

Related trading instruments: 

• Select Sector Financial Select Sector SPDR ETF (XLF)
• SPDR S&P 500 Index ETF (SPY)
• iShares Russell 2000 Index ETF (IWM)
• Nasdaq 100 Index ETF (QQQ)

Markets: Nothing Is Going To Stop Rates From Rising

Bond yields rose anyway even a 1,000 points down in the Dow Jones Industrials average wasn't even enough to send treasury yields lower with the yield on the 10-year and the 30-year rising to new highs for the move.

We had a horrible 30-year bond auction again. Why anybody showed up is beyond me but obviously not as many people showed up as they thought.  The big drop in the Dow Jones Industrials didn't make interest rates go down it just kept them from going up even more but nothing is going to stop rates from rising.

Stock Market: Volatility Signals a Trend Change

When you have a trend and then all of a sudden you see lots of volatility generally that's a sign that the trend is changing and the trend has been up obviously stocks have been trending up for years and they've been trending up with minimal volatility. When all of a sudden you see massive volatility does that mean the trend is likely to continue? No! It's more likely a sign that the trend has come to an end. (SPDR Dow Jones Industrial Average ETF (DIA), iShares Russell 2000 Index ETF (IWM), Nasdaq 100 Index ETF (QQQ), SPDR S&P 500 Index ETF (SPY))

This Just Shows How Quickly The Market Can Go Down

If you look at the five days from the high, in five trading days the Dow Jones futures lost about 13 percent of their value. In five days! Now that just shows you how quickly the market can go down, I mean, the next time it could lose even more even faster. (SPDR S&P 500 Index ETF (SPY), Nasdaq 100 Index ETF (QQQ), iShares Russell 2000 Index ETF (IWM), SPDR Dow Jones Industrial Average ETF (DIA))

Markets: The Problem With The Debt

Today if we have trillion dollar deficits not only is the Federal Reserve not monetizing any of it but the Federal Reserve is actually contributing to the problem by not rolling over the bonds that it holds as claiming it's going to shrink its balance sheet. Which means on top of the trillion dollars that the Treasury would need to sell to finance its deficits it's gonna have to sell extra Treasuries to repay the Fed what it's not rolling over. So this is impossible, this is a tidal wave of debt that's coming out of the market.

Related trading instruments: 10-Year U.S. Treasuries, iShares Barclays 20+ Year Treasury Bond ETF (TLT)

Stock Market: It's a Major Decline

We didn't have a black Monday like 1987 as it wasn't a 20 percent decline but it was the biggest point decline in the history of the stock market by a large magnitude. We were down 1,175 points and we were down 1,600 points at the intraday low. So this is the biggest point decline ever but in percentage terms it is in the top 20 (I think it was like number 14 or something) but it is a major decline and we rarely see declines this big. (SPDR S&P 500 Index ETF (SPY), SPDR Dow Jones Industrial Average ETF (DIA), Nasdaq 100 Index ETF (QQQ))

Stock Market: This Brings Back Vivid Memories Of 2008

Listening to all the so-called experts on financial TV reassuring investors that there is nothing to worry about, and that the fundamentals are sound, brings back vivid memories of 2008, as that's exactly what the same experts were saying just before the financial crisis. (SPDR Dow Jones Industrial Average ETF (DIA), Nasdaq 100 Index ETF (QQQ), SPDR S&P 500 Index ETF (SPY))

Stock Market: This Year Seems To Have A Lot In Common With 1987

Think about this, 1987 was the year that we had the stock market crash. Well, January was the best month for the US stock market since 1987 and the US Dollar just had its weakest January since 1987. So far this year seems to have a lot in common with 1987.

Stock Market Correction: The Start of Something Much Bigger

A three percent correction is pretty normal except we haven't had one in a long time and the question is is this the start of something more ominous or is this just a small correction and you know what I think there's a lot of evidence that it is the start of something much bigger part of the evidence is that nobody is concerned nobody is worried there's maximum complacency. (SPDR Dow Jones Industrial Average ETF (DIA), SPDR S&P 500 Index ETF (SPY), Nasdaq 100 Index ETF (QQQ))

Pronounced Weakness In The US Dollar

January is over this is the worst January for the dollar index since 1987, this is a big move! January was the weakest month for the dollar against the yuan not just the weakest January but the weakest of any month going all the way back to 1994. So we're having some pronounced weakness in the dollar at a time where everybody is optimistic on the US economy.

Greenspan: Bubbles In Stocks & Bonds

Alan Greenspan was on CNBC today talking about the bubble in the bond market the bubble in the stock market how we're coming to stagflation how we don't have any productivity growth I mean I believe that Alan Greenspan knows exactly how bad this is.

US Economy: Closer To A Collapse

We're near the end of the game and unfortunately Trump's gonna be the fall guy. This thing is all gonna collapse while he's President and he owns the stock market bubble and he and the Republicans own the economy now thanks to these tax cuts. They're not gonna make any difference but they are gonna give the Democrats a reason to blame it all on Trump and the Republicans. We are getting closer to this collapse.

The US Economy Is Going To Blow Up

"The economy is gonna blow up but you know, it's gonna blow up like a bomb!" - Peter Schiff, in InfoWars (January 2018)

Why Wall Street Is Wrong About Gold Stocks

Peter Schiff in a recent article explains why Wall Street is wrong about gold stocks:

"When they see the price of gold going up, they’re like, ‘Well, why is the price of gold going up? I mean, what’s the point. The economy is great. There’s no inflation. The Fed is raising rates. Nobody’s buying gold. If it’s going up, it’s just going to go down.’ And so nobody sees the urgency to buy gold stocks the way they see the urgency to maybe buy oil stocks. But this is because they’re wrong. They think there is nothing to worry about. There is everything to worry about. There are so many things – there have probably never been more things to worry about. And the crazy thing is people aren’t worried about any of them. It’s probably because of the mania, because of the bubble. When you get into that mentality, nothing worries you.”

Related stocks: Goldcorp (GG), Newmont Mining (NEM), Barrick Gold (ABX), NovaGold (NG), Market Vectors Gold Miners ETF (GDX)

Stock Market: The Hidden Risks

In a recent article with Seeking Alpha, Peter Schiff highlights the hidden risks that might disrupt the stock market in th near future:

"The stock market is rising despite the fact that there are very, very negative factors that are building, that are hiding in plain sight, that everybody is ignoring.”

"Everybody thinks the economy is in great shape because they think the Fed solved the problem. No, they didn’t. They made the problem much worse! They made the problem that they created worse. But the people who think they solved it are the same people who didn’t understand it before. And they got blindsided in ’08 and they’re going to get blindsided again because they never learned from their mistakes.”

Related trading instruments: SPDR Dow Jones Industrial Average ETF (DIA), SPDR S&P 500 Index ETF (SPY), Nasdaq 100 Index ETF (QQQ)

Inflation Is Bullish For Gold

The stock market should be affected by higher interest rates but no, they don't care but they somehow think it's going to be bad for gold. But the reality is higher inflation is great for gold, that's why people buy gold as it's a hedge against inflation. So the more inflation the more demand there is for gold.

Related trading instruments: SPDR S&P 500 Index ETF (SPY), iShares Russell 2000 Index ETF (IWM), SPDR Dow Jones Industrial Average ETF (DIA), SPDR Gold Trust ETF (GLD)

Stock Market: Heading For A Crisis

This is the best start since 2006 and of course people who were buying stocks in 2006 had no idea of the magnitude of the financial crisis that would hit the market in 2008 well the same people are even more clueless today because the crisis that we're heading for is going to be much much bigger much worse than the one in 2008. (SPDR Dow Jones Industrial Average ETF (DIA), SPDR S&P 500 Index ETF (SPY), Nasdaq 100 Index ETF (QQQ), iShares Russell 2000 Index ETF (IWM))

Crude Oil: We Can See $80-100 This Year

I've been talking about oil prices going up on this podcast. This is the highest oil has closed over two years and if we get above 62.75 which is less than a dollar away that would be the highest closed in oil since December of 2014. But it was all between July of 2014 in December that oil prices collapsed from above $100 a barrel to down below 40 and so I think once we get above 63 for example, I think we got clear sailing up to 80 to $100 oil and I think we can do that this year!

The Implications of the US Dollar Weakness

On a recent tweet, Peter Schiff highlights the recent moves in crude oil and gold and the implications of the US Dollar weakness going forward: 

"Gold closed above $1,300 an ounce for the 1st time in 5 years, oil closed above $60 per barrel for the 1st time in 4 years, and the U.S. dollar fell the most in 14 years. Interesting that no one is worried about what this implies for inflation or interest rates in 2018!"

Related: SPDR Gold Trust ETF (GLD), United States Oil Fund LP ETF (USO), Nymex Crude Oil Futures

US Stock Market: This Never Happened Before In History

I think this is the first year that the Dow Jones Industrials Average (DJIA) has ever gained 5,000 points in a single year. In fact, the Dow Jones was up every month of 2017. That's never happened before in history.

In fact, we've gone 14 consecutive months without a decline and not only were we up every month but 2017 represented the lowest year ever of stock market volatility meaning that even though the market was going up it barely ever went down so it never made anybody nervous.

Related trading instruments: SPDR Dow Jones Industrial Average ETF (DIA), iShares Russell 2000 Index ETF (IWM), Nasdaq 100 Index ETF (QQQ), SPDR S&P 500 Index ETF (SPY)

Stock Market: Expensive, Complacency

The market has never been this expensive while at the same time so few people are worried that it might go down. (Select Sector Financial Select Sector SPDR ETF (XLF), Energy Select Sector SPDR ETF (XLE), SPDR S&P 500 Index ETF (SPY), SPDR Dow Jones Industrial Average ETF (DIA), iShares Russell 2000 Index ETF (IWM), Nasdaq 100 Index ETF (QQQ))

The Next Recession

Recessions have been happening for quite some time and you know the next one is long overdue and I do think that the enthusiasm surrounding the tax cuts and the gains in the market could well extend  the period between now and the next recession but I don't think it will extend it long enough for Trump to be reelected.

Bitcoin Is Going To Crash Down

I am sure that it is a bubble, in fact it's probably the biggest bubble I've ever seen in my career as an investor and I've seen quite a few bubbles and I'm familiar with this psychology that surrounds them.

And you know Bitcoin has all of the characteristics of a bubble, in fact it's not just Bitcoin it's the entire cryptocurrency space. I think it's a massive speculative bubble and maybe we've seen the top and maybe we haven't I don't know but I think when the top is in this thing is gonna come crashing down, it's not just gonna go down slowly. You know there's an expression that markets take the stairs up and the elevator down, well you know Bitcoin took a rocket ship up and it's gonna come down even faster.

2018 Outlook: Gold, Bitcoin

"If people earn more money because central banks create more money they use their additional incomes to bid up prices for everything so I think a lot of prices are gonna be rising not just the price of gold." 

"I do believe as more people perceive the threat of inflation and see the dangers of what the central banks have been doing I think the price of gold will rise faster than a lot of other prices as people embrace it as a hedge against inflation and as a store of value."

Bitcoin Bulls Are Going To Get Slaughtered

Bitcoin keeps going up, we are at in 17,000 today and look how big can the bubble get? I don't know. I mean I'm not that smart. I'm smart enough to know what is a bubble but I'm not smart enough to know where the peak is but there's an old saying, Bulls make money, Bears make money and pigs get slaughtered. And there are a lot of Bitcoin pigs I believe who are gonna get slaughtered so if you happen to own some Bitcoin and you bought them and you have some profits, sell.

Gold Will Rally In The New Year

In the last few years you've seen gold sell off at the end of the year and then rally pretty strong in the new year because what happens is towards the end of the year people get very optimistic about the future Oh things are gonna get better growth is gonna pick up the economy is gonna take off and so they get optimistic they buy stocks they buy the dollar a little bit they sell their gold and then the new year comes around and the hoped for rebound doesn't materialize and then they buy the gold back and the dollar sells off and and that's I think where we are.

Related trading instruments: SPDR Gold Trust ETF (GLD), Market Vectors Gold Miners ETF (GDX), Market Vectors Junior Gold Miners ETF (GDXJ)

The Tax Plan

I believe if this plan passes we are gonna have a tax code that is more gamable where more people are doing more things to rig the system or exploit the loopholes. Not that there's anything wrong with that I mean that's what every American is going to do righ, no American has a legal obligation to pay more taxes than what is owed and to the extent that you can rearrange your affairs such that you pay the lowest possible tax that's what everybody is going to do and that is why the projections that the Republicans are out there with that this is going to add just 1.5 trillion to the deficit over the next ten years are a bunch of nonsense. I'm sure that it will add more than twice as much more than three trillion to the deficit over the next 10 years.

Federal Reserve: 2 Years To Move The Rate From 0.00% to 1.375%

It's taken the Federal Reserve two years to move the rate from zero to 1.375%. This is an extraordinary amount of excess monetary stimulus to say that the Federal Reserve has been successful in normalizing rates is complete nonsense.

CNBC Becomes Crypto News BitCoin Network

This Bitcoin bubble is the most irrational of any of the bubbles I've seen. I think there is less of a legitimate case for Bitcoin than there was for any of the dot-com stocks that went to zero or buying subprime mortgages.

Wiping Out The Debt With Inflation

I think the problem we are going to be confronted with is going to be much worse than a financial crisis. It is going to be a US dollar crisis, and it is going to be a sovereign debt crisis where the bonds people are worried about are not some sub-prime mortgages,  it’s going to be the U.S. government that people are worried about and the solvency of the U.S. Treasuries.

If it’s a US dollar crisis and people are worried about the US dollar, the only thing worse than owning a dollar today is owning the promise of being paid in dollars in the future. 

I don’t think we have the courage to default and admit to our creditors that we don’t have the money and we can’t repay. I think we will create all the money that we need so we can pretend to repay, but what we end up doing is wiping out the debt with inflation.

Related trading instruments: SPDR Gold Trust ETF (GLD), iShares Silver ETF (SLV), iShares Barclays 20+ Year Treasury Bond ETF (TLT)

Money: The Real Alternative Is Gold

People don't trust fiat currencies they don't trust a dollar euro yen they're looking for an alternative and believe me the real alternative is gold and more and more people are going to embrace it.

Related trading instruments: SPDR Gold Trust ETF (GLD), Market Vectors Gold Miners ETF (GDX), Market Vectors Junior Gold Miners ETF (GDXJ)

Silver Will Get To 40 At Some Point

Silver will get to 40 dollars an ounce at some point. (iShares Silver ETF (SLV), Hecla Mining (HL))

Another Reason Why Gold Prices Are Suppressed

A lot of the typical gold buyers who were worried about the economy when Barack Obama was President, they're not worried anymore. They think Donald Trump is gonna make America great again and they're wrong. He's not going to make America great again.

I hope America is great again at some point but it's not going to happen during the Trump presidency and people should be more worried because a lot of the problems that built up under Obama are getting worse under Trump.