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Protection Is Failing - Matthew Tuttle #6376 · Financial Survival Network

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  Speaker 1: You know understand if you're chasing a lot of these
• 0:04
  Speaker 1: meme type stocks. Yeah, eventually the fundamentals are going to matter,
• 0:09
  Speaker 1: which is one of the big reasons we tell people,
• 0:12
  Speaker 1: you know, always behedged.
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  Speaker 2: You're listening to Carrie Leutz's Financial Survival Network, where you
• 0:18
  Speaker 2: get valuable information. You just can't find anywhere else to
• 0:22
  Speaker 2: thrive in today's trying times. You need the Financial Survival
• 0:26
  Speaker 2: Network now more than ever. Go to Financial Survivalnetwork dot
• 0:31
  Speaker 2: com and get your free newsletter and gift. Financial Survival
• 0:35
  Speaker 2: Network now more than ever.
• 0:41
  Speaker 3: And welcome you are listening to and watching the Financial
• 0:45
  Speaker 3: Survival Network. I'm your host, Carrie Letz and today got
• 0:50
  Speaker 3: a special triet for you. You're always telling me we
• 0:54
  Speaker 3: don't want mainstream thinkers. You don't want to hear the
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  Speaker 3: Kramer types out there hawking the latest shiny object that
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  Speaker 3: Wall Street is so fond of, and in fact it's
• 1:10
  Speaker 3: their business model. Well, I'm delivering through for you today
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  Speaker 3: in spades. The website you want to go to is
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  Speaker 3: tuttlecap dot com. T U t t l e c
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  Speaker 3: ap dot com. Matthew Tuttle is with us now, Matthew,
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  Speaker 3: nobody could ever accuse you of being a traditional Wall
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  Speaker 3: Street thinker.
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  Speaker 4: Could they?
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  Speaker 1: They definitely could not.
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  Speaker 3: So obviously you have a different take on things. Obviously
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  Speaker 3: the biggies.
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  Speaker 4: Out there aren't going to hire you.
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  Speaker 3: How did you become a contrarian? Was this from a
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  Speaker 3: young age?
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  Speaker 1: It was from a fairly young age, you know. I
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  Speaker 1: first kind of became a contrarian reading this Jack Schwager's
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  Speaker 1: Mark of Wizard's Books. I read him in the nineties.
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  Speaker 1: They were fascinating. At the same time, I had a
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  Speaker 1: professor in my MBA class teaching modern portfolio theory who
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  Speaker 1: took me aside and said, yeah, you know what, none
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  Speaker 1: of this stuff works, but they make me teach it.
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  Speaker 1: Then I went on, that's a little cynical.
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  Speaker 4: Ended it was.
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  Speaker 1: Then I went on to work on Wall Street. You know,
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  Speaker 1: I was there during the Internet bubble and what passed
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  Speaker 1: for advice was horrifying. So that was kind of the
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  Speaker 1: last straw for me. Went out for my own company
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  Speaker 1: and never looked back.
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  Speaker 3: So Matthew like, it's over one hundred years since Benjamin Graham.
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  Speaker 3: I think it's close to one hundred years since he
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  Speaker 3: wrote what did you write? Securities Analysis? Intelligent Investor? And
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  Speaker 3: all that. He didn't he wasn't that wealthy when he
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  Speaker 3: passed on, but he did give a logical framework of
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  Speaker 3: how you analyze securities figure out what they're worth. Does
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  Speaker 3: any of that apply anymore?
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  Speaker 1: Yes and no. You know, I I started investing in
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  Speaker 1: the early eighties. I grew up with Fidelity, Peter Lynch's
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  Speaker 1: from my hometown. And you know, back then, fundamental analysis
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  Speaker 1: was was what you did. And if you were you know,
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  Speaker 1: a hard worker and you were smart, you know you're
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  Speaker 1: going to find undervalued companies that people weren't find it. Today,
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  Speaker 1: we've all got the Internet, we've got Boomberg, we've got Ai,
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  Speaker 1: and we've got what I call the retail revolution that
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  Speaker 1: came out of COVID, where retail investors wield more power
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  Speaker 1: than they ever have before, not only as a group,
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  Speaker 1: but also now you've got a lot of the you know,
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  Speaker 1: the hedge funds, the quote unquote smart money who are
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  Speaker 1: following what retail investors do. So every once in a while,
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  Speaker 1: valuations matter. You've just got to be cognizant that this
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  Speaker 1: is a different market. And I don't think we're going back.
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  Speaker 3: And once upon a time you didn't have branding patents.
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  Speaker 3: Intellectual property really wasn't worth a whole heck of a
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  Speaker 3: lot of intangible values. It was really hard to judge
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  Speaker 3: them and to make valuation judgments on them, unlike today.
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  Speaker 1: Right, well, yeah, I mean, you know, everything is different today.
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  Speaker 1: The technology that we've got to be able to do things,
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  Speaker 1: you know, it enlightening speed. You know, it's it's change everything.
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  Speaker 1: The one thing that will never change as human emotion,
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  Speaker 1: you know that that's the one constant. But you know,
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  Speaker 1: beyond that, things change. But you know, understand if you're
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  Speaker 1: chasing a lot of these meme type stocks, yeah, eventually
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  Speaker 1: the fundamentals are going to matter, which is one of
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  Speaker 1: the big reasons we tell people, you know, always be hedged.
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  Speaker 3: Okay, so always be hedged. And what does that mean exactly?
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  Speaker 1: So I'll tell you what it doesn't mean to me.
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  Speaker 1: Bonds are not a hedge. Gold is not a hedge.
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  Speaker 1: Bitcoin certainly is not a hedge. Cash is not a hedge,
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  Speaker 1: even though cash helps somewhat. What we kind of try
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  Speaker 1: to teach people are ways to use options, you know,
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  Speaker 1: in more advanced ways. I mean, at a minimum, could
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  Speaker 1: you buy some you know, s and p five hundred
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  Speaker 1: puts or you know a put spread. Yeah, you know
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  Speaker 1: that's going to cost you. You know, we've got an
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  Speaker 1: ETF coming out probably in about ninety days. The ticker
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  Speaker 1: symbol is oh oh and it's a no bleed tail
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  Speaker 1: risk ETF. There are ways to use options to set
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  Speaker 1: things up so that you've got puts on the market,
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  Speaker 1: but you've got ways to pay for some or all
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  Speaker 1: of those puts so they don't become a massive portfolio drag.
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  Speaker 1: And you know that that's the type of stuff we
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  Speaker 1: try to teach people. It gets pretty complicated, but in
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  Speaker 1: a minimum just you know, have some s and P
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  Speaker 1: five hundred puts or some NASDAC puts or you know
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  Speaker 1: a put spread.
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  Speaker 3: Okay, So complicated trading strategies, how do they perform over time?
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  Speaker 4: It depends.
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  Speaker 1: Complicated trading strategies in the hands of people who don't
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  Speaker 1: know what they're doing perform awfully. Complicated trading strategies When
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  Speaker 1: you know what you're doing and know how to look
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  Speaker 1: at it and know how to structure it, I think
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  Speaker 1: that works fine. What you don't want to do is
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  Speaker 1: base things off of past performance. You know, be careful
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  Speaker 1: with trend following. You know a lot of people. You know,
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  Speaker 1: for a lot of people, trend following is a hedge
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  Speaker 1: that hasn't worked, and that you know, that's had the
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  Speaker 1: opposite effect, that's getting you out right when you want
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  Speaker 1: to get in and getting you in right when you
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  Speaker 1: want to get out. So but you know, to me,
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  Speaker 1: a complicated strategy in the hands of someone who knows
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  Speaker 1: what they're doing not a problem.
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  Speaker 3: M all right, And uh, what do you think the
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  Speaker 3: biggest risk today in the market?
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  Speaker 4: Is Is it the fact? Yeah?
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  Speaker 3: Is it the fact that the markets are at record
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  Speaker 3: levels and they're due for a pullback? Or like you said,
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  Speaker 3: emotions never changed. People are always emotional and they're always
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  Speaker 3: going to be making emotionally based decisions.
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  Speaker 1: So those things are definitely there. I think the thing
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  Speaker 1: that would worry me the most is if all of
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  Speaker 1: this AI spend is smoking mirrors. You know, we know
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  Speaker 1: AI is going to change the future. I mean I
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  Speaker 1: use it extensively in my practice. It has replaced the
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  Speaker 1: need for certain people and it will replace the need
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  Speaker 1: for certain things. But what we don't know is how
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  Speaker 1: that AI gets monetized. And you know, when do we
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  Speaker 1: see a return on all that spend? You've got the
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  Speaker 1: circular financing deals. Do those blow up? You've got what's
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  Speaker 1: happening in private credit due to all of this. So
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  Speaker 1: that's the type of thing like you know, Mark's go
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  Speaker 1: up too far and they snap back, you know, five
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  Speaker 1: ten percent. Again, if you're hedged, not a big deal.
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  Speaker 1: If you're investing smartly, yeah that stinks, but again not
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  Speaker 1: a big deal. What you need to worry about are
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  Speaker 1: those systematic things like COVID like two thousand and eight,
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  Speaker 1: black swans those what's that black swans? The black swans,
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  Speaker 1: And if this whole AI thing unravels, then you have
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  Speaker 1: a black swan. So that would be the thing that
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  Speaker 1: would keep me up at night.
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  Speaker 4: M hmm. So here's a question for you.
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  Speaker 3: So AI, you know, trillions of dollars are heading into it,
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  Speaker 3: we all use it to maybe you and I are
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  Speaker 3: a little ahead of the loop as opposed to others,
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  Speaker 3: but I don't think there's any question. Uh, it's effects
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  Speaker 3: upon society, the workplace, everything you do, it's going to
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  Speaker 3: be be astounding. But like you said, monetization. The only
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  Speaker 3: one who's actually monetizing it effectively maybe is Tesla.
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  Speaker 4: And Xai.
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  Speaker 3: But even there, like Xai, you're not going to get
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  Speaker 3: back trillions of dollars charging forty bucks or even two
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  Speaker 3: hundred bucks a month, are you no?
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  Speaker 1: I mean I paid two hundred bucks a month for
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  Speaker 1: chet GBT. I think I pay forty bucks a month
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  Speaker 1: for the advanced rock, you know? Yeah, I mean what
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  Speaker 1: can your valuation be there? You know, I think the
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  Speaker 1: real winners could end up being the old economy companies
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  Speaker 1: that are utilizing it. But again, how much are they
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  Speaker 1: going to win? You know, should a Walmart be trading
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  Speaker 1: it fifty times earnings because they're using AI to increase profitability?
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  Speaker 3: You know?
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  Speaker 1: Probably not? You know, so, yeah, we know it's going
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  Speaker 1: to change the future, but does it justify you know,
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  Speaker 1: does it justify a utility company trading at forty times earnings?
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  Speaker 1: You could certainly make an argument that it doesn't mm hmm.
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  Speaker 3: But new businesses can be formed, a whole new ways
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  Speaker 3: of doing things, supply chains, manufacturing, you name it. I mean,
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  Speaker 3: I think it's obvious a number of our larger companies
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  Speaker 3: in the country are already being run by AI. Alphabet, Google, Tesla,
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  Speaker 3: obviously Microsoft almost certainly, maybe not being one hundred percent
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  Speaker 3: run by it, but certainly AI is the driving force
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  Speaker 3: and all these companies. So does it just make existing
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  Speaker 3: companies more efficient, more profitable, or does it open up
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  Speaker 3: opportunities in the marketplace that we haven't even conceived of yet.
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  Speaker 1: It's both. So there's certainly some company is it's going
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  Speaker 1: to make more profitable. There are other companies that it's
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  Speaker 1: going to put out of business. There are going to
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  Speaker 1: be opportunities new areas. Like we saw, you know, no
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  Speaker 1: one was really thinking about memory and all of a sudden,
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  Speaker 1: you know, memory is a bottleneck. Now memory is expensive,
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  Speaker 1: and the sand discs of the world have you know,
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  Speaker 1: quadrupled or even more than that. You know, if you
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  Speaker 1: had asked me what you know, if no one was
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  Speaker 1: talking about photonics a year ago, Now now that's a thing.
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  Speaker 1: So it's going to create opportunities there. It's also going
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  Speaker 1: to create opportunities when you throw the baby out with
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  Speaker 1: the bathwater, like what happened with software. All software sold off.
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  Speaker 1: But I would argue there are certain areas of software
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  Speaker 1: that will actually benefit from AI, and we were scooping
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  Speaker 1: those up in our you know, Mimi ETF which is
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  Speaker 1: our most say symmetrical idea is versus some other areas
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  Speaker 1: of software that yeah, I mean, they probably deserve to
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  Speaker 1: get you know, taken out and crushed because AI is
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  Speaker 1: going to put them out of business at some point.
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  Speaker 4: Yeah.
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  Speaker 3: So yeah, interesting times ahead, that's for sure. So what
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  Speaker 3: new products do you have in the pipeline to help
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  Speaker 3: us wind our way through the AI minefield?
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  Speaker 1: So what I'm going to be laser focused on is
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  Speaker 1: what are the themes that you should be in, try
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  Speaker 1: to get you in early and you know, and launch
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  Speaker 1: gtfs around that. And we've done that before. I did
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  Speaker 1: the inverse r E ETF at the top of the market.
• 13:45
  Speaker 1: We did e WAD, which is europe European Aerospace and
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  Speaker 1: Defense right after Trump got elected because we knew that,
• 13:53
  Speaker 1: you know, Trump won was going to be a lot
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  Speaker 1: like Trump too as far as NATO goes. What we
• 13:59
  Speaker 1: just did is wed UFO D. It's called the UFO
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  Speaker 1: Disclosure ETF, which Trump and Obama were nice enough to
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  Speaker 1: help help give us a little bit of a boost,
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  Speaker 1: you know, the past couple of days. So you know,
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  Speaker 1: neither of them are on my payroll, even though some
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  Speaker 1: people have asked, you know, but that's more based off
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  Speaker 1: of something we call the secret gap, where the government
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  Speaker 1: always has stuff that we haven't seen. They developed the Internet, GPS,
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  Speaker 1: self driving, you know, a whole bunch of other things
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  Speaker 1: years before we saw it. And that's based off of
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  Speaker 1: the possibility that they've got you know, advanced energy and
• 14:41
  Speaker 1: propulsion technology. Another thing we're working on is European digital sovereignty.
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  Speaker 1: So a lot like our European Aerospace and Defense idea,
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  Speaker 1: where we realize the European countries we're gonna have to
• 14:54
  Speaker 1: deal with their own defense. They want to deal with
• 14:58
  Speaker 1: their own digital sovereignty. They don't want to rely on
• 15:02
  Speaker 1: us companies, so we're working on that. Chinese robotics is
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  Speaker 1: something that we're really interested in. We've got a project
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  Speaker 1: we're working on, you know, potentially in India, and we're
• 15:18
  Speaker 1: continuing to try to innovate. So, you know, in the
• 15:22
  Speaker 1: ETF field, covered call ETFs have become very popular. I
• 15:27
  Speaker 1: hate them because they're not asymmetrical. You're giving up upside
• 15:31
  Speaker 1: and you've got unlimited downside. We've got an idea there
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  Speaker 1: we're coming out with. It has embedded hedges the way
• 15:39
  Speaker 1: we talk about where the puts are paid for and
• 15:43
  Speaker 1: have a way not to limit your upside. So and
• 15:47
  Speaker 1: you know, and I've got my kil risk product. So
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  Speaker 1: those are some of the things I'm most excited about.
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  Speaker 3: All right, Well, it seems like you're certainly ahead of
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  Speaker 3: the wave, Matthew. What's the best place to track you
• 15:58
  Speaker 3: down on the web, connect with you, find out more
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  Speaker 3: about what you're doing.
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  Speaker 4: Yeah.
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  Speaker 1: So, our website, like you said before, is tuttlecap dot com.
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  Speaker 1: We have a free daily newsletter. I write about a
• 16:10
  Speaker 1: lot of these themes, stocks, I'm watching all sorts of stuff.
• 16:16
  Speaker 1: It is long, but you know it's free. Feel free
• 16:20
  Speaker 1: to sign up for that. We do a lot of webinars.
• 16:22
  Speaker 1: You'll get information on that. I also try to be
• 16:25
  Speaker 1: active on Twitter. That's at Tuttle Capital. I don't have
• 16:29
  Speaker 1: a lot of time, but when I do, I try
• 16:31
  Speaker 1: to be active there.
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  Speaker 4: Right.
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  Speaker 3: All right, Hey, we really appreciate you coming on, and
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  Speaker 3: thanks again for your patience. Got any questions from Matthew myself,
• 16:40
  Speaker 3: shoot me an email klatcarrieluts dot com and really do
• 16:46
  Speaker 3: appreciate you coming on.
• 16:47
  Speaker 4: We will talk to you again soon. Thanks so much, Matthew.
• 16:49
  Speaker 2: Thank you, thanks for listening to Carrie Letz's Financial Survival Network,
• 16:54
  Speaker 2: your solution to today's trying times. For the latest, go
• 16:58
  Speaker 2: to financial Survival Network dot com Financial Survival Network now
• 17:04
  Speaker 2: more than ever,