Latest / Felix Nikolas Prehn's Podcast / Banks Just told Big Clients to SELL... + Stock Market News 17 May 2024

Transcript

Banks Just told Big Clients to SELL... + Stock Market News 17 May 2024 · Felix Nikolas Prehn's Podcast

• 0:00
  Speaker 1: Felix here and good morning to you.
• 0:01
  Speaker 1: Welcome to this glorious pre-market live stream, live from the South of France, where life is good, the sun is shining, the skies are blue and what have we got in store today?
• 0:12
  Speaker 1: Well, a lot of Wall Street is basically saying the risk is not in favor of stocks right now and it's not quite what you think.
• 0:22
  Speaker 1: You might think okay, sell stocks.
• 0:24
  Speaker 1: Oh, no, it's all over.
• 0:25
  Speaker 1: That's not actually what they're saying.
• 0:26
  Speaker 1: They're just saying that there is a smarter way to participate in the market right now.
• 0:32
  Speaker 1: That is way cheaper, that has potentially way less risk, and I want to explain that to you, because that's what this whole community is all about.
• 0:38
  Speaker 1: Time must be off and soft, says George.
• 0:39
  Speaker 1: Everything is a little bit slower and soft.
• 0:40
  Speaker 1: Time must be off and soft, says George.
• 0:42
  Speaker 1: Everything is a little bit slower and soft.
• 0:43
  Speaker 1: You know how it works, so let me share my screen with you and I will enlighten you.
• 0:52
  Speaker 1: There we are.
• 0:52
  Speaker 1: Crazy background.
• 0:54
  Speaker 1: You can see where the back end of YouTube looks like.
• 0:56
  Speaker 1: Smash the like buttons, guys.
• 0:57
  Speaker 1: Only 29 likes so far.
• 0:59
  Speaker 1: What's going on?
• 1:00
  Speaker 1: There's me broken with your button.
• 1:01
  Speaker 1: Okay, so this is.
• 1:04
  Speaker 1: Let me just see.
• 1:05
  Speaker 1: You can actually see that.
• 1:06
  Speaker 1: I think.
• 1:07
  Speaker 1: So you can see it in that direction.
• 1:08
  Speaker 1: Right, okay, this is what Wall Street is saying.
• 1:12
  Speaker 1: You might be thinking this is what.
• 1:13
  Speaker 1: Well, first of all, look at where we are on the chart here.
• 1:16
  Speaker 1: Right, we've just exceeded the previous highs, but only just so.
• 1:21
  Speaker 1: It's a reasonable assumption.
• 1:23
  Speaker 1: We might trade a little bit sideways here unless we get some glorious new data coming in, some more people unemployed, or the sort of thing that Wall Street likes to celebrate.
• 1:32
  Speaker 1: Yay, the little man's getting poorer and that's not me, that's Wall Street, obviously.
• 1:37
  Speaker 1: So what's the smarter trade?
• 1:39
  Speaker 1: Well, wall Street's saying there's no financial advice.
• 1:42
  Speaker 1: Right, just an old banker sharing some foods.
• 1:43
  Speaker 1: Saying this is not financial advice.
• 1:44
  Speaker 1: Right, just an old banker sharing some foods.
• 1:45
  Speaker 1: Sell your stocks and buy options.
• 1:47
  Speaker 1: That's literally what they're saying.
• 1:48
  Speaker 1: And let me show you why.
• 1:49
  Speaker 1: Okay, if you were to buy, say you owned a hundred shares of SPY right now, right, well, you'd have $50,000 tied up in SPY, the S&P 500 ETF.
• 2:04
  Speaker 1: If you were to sell those, you get $50,000.
• 2:05
  Speaker 1: You probably can get 4.9% from your bank.
• 2:06
  Speaker 1: And then, if you were to put $850 of that in a call option expiring at the end of June and say the market did continue to rally.
• 2:16
  Speaker 1: The market went up to another 30 points to 550.
• 2:19
  Speaker 1: Well, you would make 154% return on that money.
• 2:23
  Speaker 1: So you make $1,300 on that.
• 2:26
  Speaker 1: So you could be significantly less invested and still take advantage of the gains.
• 2:33
  Speaker 1: Because what's a 20-point gain?
• 2:36
  Speaker 1: Let's get the calculator out here 20 points on 529, where we are right now, it's a 3% or 4% move which, on your $50,000, would be $1,800.
• 2:50
  Speaker 1: So you could literally take $49,000 of that as risk-free money, put it in a bank account that pays you 4.9% or something like that, and you just invest $850 of that and you still get pretty much exactly the same upside.
• 3:06
  Speaker 1: And why is that?
• 3:08
  Speaker 1: Because right now options are very, very cheap.
• 3:10
  Speaker 1: They are really really cheap right now.
• 3:12
  Speaker 1: So it's something to look at Now.
• 3:14
  Speaker 1: You might not understand options.
• 3:15
  Speaker 1: You might think it's crazy, you might think it's super risky and all of that, and I get that.
• 3:18
  Speaker 1: It's not something that we are taught.
• 3:20
  Speaker 1: Unfortunately we should be.
• 3:21
  Speaker 1: But come and join me on Tuesday, okay, and I'll teach you tea.
• 3:25
  Speaker 1: Very, very simple.
• 3:25
  Speaker 1: I literally teach you exactly the strategy that I use that makes us money continuously, has done for years the same strategy that Wall Street hedge funds employ.
• 3:35
  Speaker 1: Just head over to phoenixfriendsorg slash.
• 3:36
  Speaker 1: Did I say training?
• 3:38
  Speaker 1: I thought I should say webinar, interesting.
• 3:42
  Speaker 1: Where does phoenixfriends, does Felix training?
• 3:45
  Speaker 1: Thank you, it should be webinar.
• 3:48
  Speaker 1: Let's try that out.
• 3:48
  Speaker 1: Training, training.
• 3:49
  Speaker 1: Let's just check that works.
• 3:53
  Speaker 1: Does that work?
• 3:56
  Speaker 1: May 21st?
• 3:57
  Speaker 1: Yeah, that works.
• 3:58
  Speaker 1: Okay, felixpenceorg slash training.
• 3:59
  Speaker 1: There it is.
• 4:00
  Speaker 1: So that's one thing.
• 4:01
  Speaker 1: Right Now you might be thinking but Felix, the market's going to collapse, it's all going to go to you know what.
• 4:06
  Speaker 1: It'll be terrible.
• 4:07
  Speaker 1: Well, you could do the same thing.
• 4:09
  Speaker 1: You could again say cost you $720, and say we drop back down to just below 500,.
• 4:20
  Speaker 1: Well, again, you would make a 370% gain.
• 4:23
  Speaker 1: So you'd make basically the same with $800 in options as you would with $50,000 in the shares.
• 4:31
  Speaker 1: This is what Wall Street's looking at right now and I wanted to share that with you.
• 4:34
  Speaker 1: So check it out.
• 4:35
  Speaker 1: The screenshots are, of course, from optionswatchio If you haven't checked that out yet, links also down below and this is coming up For your OptionsWatch subscribers, including you guys, on the free one-month trial.
• 4:48
  Speaker 1: You will be getting this email from early next week and it's our trend alert and it basically is a screenshot.
• 4:55
  Speaker 1: It basically tells you what stocks have had their momentum change from maybe bearish or from sideways to actually now buy signal now, does that mean you should blindly buy it?
• 5:09
  Speaker 1: And of course not.
• 5:10
  Speaker 1: Don't be an idiot.
• 5:11
  Speaker 1: But it'll save you a huge amount of time by giving you a screener.
• 5:16
  Speaker 1: We literally run through the 1,500 largest stocks every single day and we use an indicator that I have literally been working on for 20 years.
• 5:24
  Speaker 1: No kidding, first job I had in banking, that's what I started to develop there.
• 5:29
  Speaker 1: We did it in spreadsheets back then, but now, of course, we can do it a bit more intelligently.
• 5:32
  Speaker 1: So if you want to get that head over to pedixtransitorg, slash optionswatch no, just optionswatchio, actually Just optionswatchio Go over there, get yourself a free 30-day trial and you will be getting our email alerts from sometime early next week.
• 5:49
  Speaker 1: I think I'm already getting them.
• 5:51
  Speaker 1: See, I'm special.
• 5:52
  Speaker 1: Now go back a little bit to the market.
• 5:54
  Speaker 1: Here the Fed is saying well, the Fed is basically saying yesterday you need to be data dependent, we're not quite confident enough yet, and all that kind of thing, and I'll show you why they are wrong and where they are wrong and that they've been historically always wrong.
• 6:11
  Speaker 1: Blackrock the guys who run the world's money are saying they should cut rates right now and he's saying the problem with the high interest rates is that it's funneling money, exactly what I just said to you, like if you were to sell your stocks and you were to put them in a money market fund.
• 6:31
  Speaker 1: The high rates are making the upper middle class wealthier because they're getting those 5% returns from the bank risk-free.
• 6:46
  Speaker 1: And because of that, what are they doing, the bastards?
• 6:51
  Speaker 1: They're going on holiday, they're on vacation, they are spending on services.
• 6:58
  Speaker 1: They are the ones keeping the service inflation high.
• 7:01
  Speaker 1: And BlackRock is basically saying and those guys have more data than absolutely anybody on the planet just cut rates, you'll make the middle classes poorer and you'll stop all that frivolous spending on services and that will actually lower inflation.
• 7:16
  Speaker 1: So lower rates will lower inflation rather than higher rates, and I understand that comment.
• 7:21
  Speaker 1: In fact, I have another one I think the Fed should cut rates to lower housing inflation.
• 7:27
  Speaker 1: Because what happens with high rates?
• 7:31
  Speaker 1: High rates mean high mortgage costs.
• 7:37
  Speaker 1: It also means high building costs, because you've got to finance buildings and that costs a heck of a lot of money right now and therefore you get we saw the data this week less houses being built plus higher rents because the owners want to cover the mortgage and they know that there is a shortage.
• 8:00
  Speaker 1: So, again, lower rates would mean more building, it would mean lower rent and it would mean lower inflation.
• 8:14
  Speaker 1: So, really, rate cuts are actually the solution.
• 8:17
  Speaker 1: It's just the Muppets of the Fed don't seem to quite grasp that and historically they haven't.
• 8:23
  Speaker 1: Here's a chart I prepared for you.
• 8:24
  Speaker 1: You see how much money I prepare for you things.
• 8:26
  Speaker 1: I'm in the south of France on holiday a lovely morning, yet I still prepare charts for you.
• 8:30
  Speaker 1: I actually prepare them for myself too, because you know what I do.
• 8:34
  Speaker 1: I like to trade.
• 8:36
  Speaker 1: What is this?
• 8:36
  Speaker 1: The red line is the US interest rate.
• 8:39
  Speaker 1: The green shaded bit there in the background just check, you can see that I think you can are recessions.
• 8:44
  Speaker 1: And what do you see?
• 8:47
  Speaker 1: Well, before every recession, interest rates go up.
• 8:50
  Speaker 1: So it's actually the interest rates causing the recessions, and they always cut too late.
• 8:57
  Speaker 1: And then they cut really sharply, right, really really sharply.
• 8:59
  Speaker 1: Why?
• 9:00
  Speaker 1: Because there are a bunch of nitwits who don't seem to realize that the impact of higher rates comes in with an 18-month time lag, which is what pretty much everybody who's a first-year economics student will tell you.
• 9:13
  Speaker 1: That's what's in the textbooks, but these guys think they're smarter than that, so they've forgotten.
• 9:17
  Speaker 1: So what are we doing right now?
• 9:19
  Speaker 1: Well, look at the pattern of the interest rate.
• 9:21
  Speaker 1: What is that pattern?
• 9:24
  Speaker 1: I think we call it a dinosaur, and you see that when you get to the flat bit, like here or like there, that's typically when the recession is about to hit you in the face.
• 9:36
  Speaker 1: And then they start to cut really, really, really rapidly and then they cause the next bubble, because they're a bunch of nitwits.
• 9:43
  Speaker 1: Mester, the Fed president, mester said yesterday income economic information indicates that it'll take longer to gain that confidence.
• 9:50
  Speaker 1: Holding our restrictive stance for longer is prudent at this point, as we gain clarity about the path of inflation, as in, we will only cut once inflation is already down back to 2%, in which case we will have caused a massive recession, like we always have.
• 10:07
  Speaker 1: Trust the Fed, but at the moment the market is loving it.
• 10:12
  Speaker 1: The market is just thinking well, no matter what happens, rates are going to come down.
• 10:15
  Speaker 1: The Dow exceeded 40,000 points yesterday.
• 10:18
  Speaker 1: And if you look at the DIA, the Dow Jones ETF, well, do you see how cheap options are?
• 10:27
  Speaker 1: For $475, you get to control 100 shares till the end of June.
• 10:33
  Speaker 1: We go up just 10 more points.
• 10:35
  Speaker 1: You'll make 117% return on your money.
• 10:39
  Speaker 1: It's pretty staggering, isn't it?
• 10:40
  Speaker 1: That's how cheap options are right now.
• 10:42
  Speaker 1: So I would definitely look at options.
• 10:44
  Speaker 1: That's what I'm going to be doing.
• 10:46
  Speaker 1: Now let me see what else is going on here in the market.
• 10:50
  Speaker 1: Lots of windows open, except for the one that I want to look at.
• 10:52
  Speaker 1: Let's have a look at the pre-market.
• 10:58
  Speaker 1: I will, of course, take your questions as well, so put your questions in the chat.
• 11:02
  Speaker 1: This is yesterday.
• 11:02
  Speaker 1: Yesterday wasn't too bad, was it?
• 11:03
  Speaker 1: This is pre-market.
• 11:03
  Speaker 1: Microsoft green, amazon green basically flat, really Amazon flat.
• 11:06
  Speaker 1: Apple literally at zero.
• 11:08
  Speaker 1: Tesla down a touch Everything pretty much flat, and it's just the market's kind of thinking, exactly what I'm saying.
• 11:16
  Speaker 1: Well, if you hold a lot of stocks, you're at an all time high.
• 11:20
  Speaker 1: Maybe we take some profits, maybe we put the money into options and see what happens.
• 11:24
  Speaker 1: It's a lot less risky.
• 11:26
  Speaker 1: So I think we're a little bit of a consolidation pattern up here, unless we get some really really good news.
• 11:32
  Speaker 1: But it doesn't look too bad, does it?
• 11:33
  Speaker 1: Doesn't look too bad, which is just what little bit of a consolidation pattern up here, unless we get some really really good news.
• 11:37
  Speaker 1: But it doesn't look too bad, does it?
• 11:39
  Speaker 1: It doesn't look too bad, which is just what we want?
• 11:41
  Speaker 1: We just want stability here.
• 11:42
  Speaker 1: Bloomberg let's go to the US edition.
• 11:42
  Speaker 1: Have a glance at what Bloomberg makes of it all.
• 11:45
  Speaker 1: A property rescue package?
• 11:48
  Speaker 1: Blackrock says cut.
• 11:50
  Speaker 1: That's what we just talked about.
• 11:51
  Speaker 1: Gamestop extends route.
• 11:52
  Speaker 1: One plan to sell up to 45 million shares.
• 11:55
  Speaker 1: Amc has already done.
• 11:57
  Speaker 1: Voters prefer Trump, apparently.
• 12:00
  Speaker 1: Walgreen are trying to fix pharmacies.
• 12:06
  Speaker 1: Okay, not much going on over there.
• 12:11
  Speaker 1: It's not nice.
• 12:11
  Speaker 1: It's actually quite a nice calm morning here.