Latest / Felix Nikolas Prehn's Podcast / 5 Reasons to Buy *This* NOW + Stock Market News 06 February 2024

Transcript

5 Reasons to Buy *This* NOW + Stock Market News 06 February 2024 · Felix Nikolas Prehn's Podcast

• 0:00
  Speaker 1: Felix here and good morning to you.
• 0:01
  Speaker 1: It is another good looking day and I want to walk you through what actually makes me bullish.
• 0:08
  Speaker 1: Yeah, we've got all time highs on lots of stocks.
• 0:10
  Speaker 1: It looks like is it a bubble?
• 0:12
  Speaker 1: But let me walk you through the data points and then you'll understand where I'm coming from with this, and that's always my goal here is to make you the best informed investor trader out there, so you can make better decisions, make more money.
• 0:26
  Speaker 1: Of course, not the following financial advice, just an old investor banker and his cat.
• 0:31
  Speaker 1: Can you see her down there Sleeping on Winston sofa?
• 0:34
  Speaker 1: That's a strike in a sit-in if you ever wanted one.
• 0:37
  Speaker 1: If you want unions, get cats.
• 0:39
  Speaker 1: I'm also super excited because in 59 minutes, I'll be teaching a couple of hundred of you exactly how I make money, which is making money from my money, in three steps.
• 0:51
  Speaker 1: Our very simple and easy rule based trading system is what I'll teach you, completely for free.
• 0:59
  Speaker 1: All you got to do is join me in 58 minutes now at FelixFrensorg slash webinar.
• 1:03
  Speaker 1: So grab yourself one of the last couple of seats and I'll see you over there in 58 minutes.
• 1:09
  Speaker 1: Palantir, exciting, very exciting.
• 1:13
  Speaker 1: We'll definitely touch upon that.
• 1:15
  Speaker 1: I'm sure you guys have questions, a problem in the chat, I will get to them all, as always.
• 1:21
  Speaker 1: Now let's run through a couple of big juicy data points Big and juicy and orange.
• 1:29
  Speaker 1: We'll get to that one too in a moment.
• 1:30
  Speaker 1: And here it is GDP growth.
• 1:34
  Speaker 1: Us GDP growth is expected to be off the charts.
• 1:39
  Speaker 1: Goldman Sachs is saying it's going to be almost 3%, like 2.8% this year, and that's quite a lot for a US economy because it's a fairly established economy.
• 1:55
  Speaker 1: The consensus of analysts was only 1.5%, so Goldman Sachs very much leading the bull charge there.
• 2:03
  Speaker 1: And what does that mean?
• 2:04
  Speaker 1: Well, it's good news.
• 2:05
  Speaker 1: Economy grows, earnings grow, profits grow.
• 2:09
  Speaker 1: We're expecting, like Q4, to be at a 16% increase in corporate profits, which will be brilliant for stocks Doesn't mean the Fed can't cut rates.
• 2:20
  Speaker 1: I might do a little bit later, but we've basically priced that in two now.
• 2:28
  Speaker 1: So what are we really worried about here?
• 2:29
  Speaker 1: Well, there's even better news.
• 2:30
  Speaker 1: I mean, really, how stupid are people?
• 2:33
  Speaker 1: These the fat drugs right, the LLY and NVO drugs are apparently reducing inflammation in the liver, kidneys, heart and brain.
• 2:44
  Speaker 1: So they're going to be able to market them, not just for diabetes and obesity, but for inflammation.
• 2:52
  Speaker 1: Obesity causes inflammation.
• 2:55
  Speaker 1: This is not a separate thing.
• 2:58
  Speaker 1: The only reason it reduces inflammation is because it makes you less obese, it makes you slim and therefore you run Hat cells cause inflammation.
• 3:07
  Speaker 1: It's really not rocket science.
• 3:09
  Speaker 1: It's baffling, really, really baffling, right.
• 3:11
  Speaker 1: So they're doing clinical trials on this, and I mean science is a bunch of paid-for hogwash, if you ask me.
• 3:19
  Speaker 1: So, yeah, absolutely baffling.
• 3:21
  Speaker 1: But of course, it's going to be great for stocks, particularly LLY and NVO.
• 3:26
  Speaker 1: I own a bucket load of NVO, so I'm happy if people are stupid sometimes.
• 3:32
  Speaker 1: Now, what am I showing you here?
• 3:34
  Speaker 1: Well, what I'm showing you and it's a little big, isn't it Is that money markets have so much fricking cash in them.
• 3:44
  Speaker 1: More than $3 trillion are still sitting in money markets because interest rates are still high, if you haven't noticed.
• 3:52
  Speaker 1: And as they come down, what's going to happen?
• 3:54
  Speaker 1: The money is going to flow back into stocks.
• 3:58
  Speaker 1: We've actually seen outflows from stocks from the peaks of 2022.
• 4:02
  Speaker 1: And that will get robust Rates come down.
• 4:06
  Speaker 1: The stock party goes on, and on, and on and on.
• 4:09
  Speaker 1: Not just the expected stock rally, but actually the real rally goes on, much like our like count on this particular video, although it does seem to be somewhat stuck at 55, 56.
• 4:20
  Speaker 1: I think there must be something broken there, surely?
• 4:23
  Speaker 1: What about sentiment?
• 4:24
  Speaker 1: Are we in some sort of crazy exuberant bull market dot com bubble type thing, really?
• 4:33
  Speaker 1: We were a higher in 2020 and 2021.
• 4:37
  Speaker 1: We were a higher in 2019.
• 4:38
  Speaker 1: We were a higher in 2018, 17, 16, 14, 15, 13.
• 4:43
  Speaker 1: Almost as if this old banker can count right 2010 and 11.
• 4:47
  Speaker 1: We've been higher a lot of the time.
• 4:50
  Speaker 1: What does that mean?
• 4:51
  Speaker 1: It means we can actually go.
• 4:52
  Speaker 1: I am.
• 4:53
  Speaker 1: People could get more bullish.
• 4:54
  Speaker 1: Yeah, people could literally get more excited about stocks than they are right now.
• 4:57
  Speaker 1: But don't talk to the Nvidia crowd.
• 4:59
  Speaker 1: They are just off the chart.
• 5:01
  Speaker 1: They're like high on crack or something Amazon and our friends at Walmart now have.
• 5:11
  Speaker 1: It means that you have almost a 50% market share now.
• 5:18
  Speaker 1: So every new dollar spent in retail, 50 cents of it half of it now goes to Amazon and Walmart, most of it to Amazon.
• 5:29
  Speaker 1: Isn't that kind of insane?
• 5:30
  Speaker 1: So what does that mean?
• 5:31
  Speaker 1: When you're that big, you get bigger.
• 5:33
  Speaker 1: It's irreversible at that point.
• 5:36
  Speaker 1: And again, that's a bullish, powerful thing for Amazon and the stock market.
• 5:42
  Speaker 1: Amazon's a big part of that.
• 5:44
  Speaker 1: What about rate cuts?
• 5:44
  Speaker 1: What about those pesky rate cuts of the feds going?
• 5:47
  Speaker 1: Yeah, they'll be coming a little bit later.
• 5:49
  Speaker 1: No, we won't do much.
• 5:50
  Speaker 1: Maybe we won't do May.
• 5:51
  Speaker 1: That's what the bond traders are saying.
• 5:53
  Speaker 1: Well, either way, the market and the consensus and everybody is expecting around about 2.1 to 2.25% rate cuts.
• 6:04
  Speaker 1: I think my chart's a little too big here.
• 6:07
  Speaker 1: I have to move that over a little bit.
• 6:08
  Speaker 1: There we go, so you get 2% rate cuts.
• 6:13
  Speaker 1: In theory, tech stocks should go up 20% Maybe they've already done that and your bigger, slower moving beasts maybe go up 10%, 15% or something like that.
• 6:24
  Speaker 1: So it's very bullish.
• 6:24
  Speaker 1: It's very bullish for the market.
• 6:26
  Speaker 1: It really gives us lots of reasons.
• 6:28
  Speaker 1: And then what about Nvidia?
• 6:29
  Speaker 1: Is it massively overpriced?
• 6:31
  Speaker 1: Is it the bubble of all bubbles?
• 6:32
  Speaker 1: Well, if you look at the next 12 months PE so basically, if you assume what we expect 2024 profits to be like and you think they're going to hit those expectations they might exceed them then are we at really, really high levels right now.
• 6:52
  Speaker 1: Can I get a straight line?
• 6:54
  Speaker 1: We're at about 32X.
• 6:58
  Speaker 1: That's way lower than when we were in the 58s and the 62s, which is where we were in 2021 and 2020.
• 7:08
  Speaker 1: It's way lower than 2020.
• 7:10
  Speaker 1: It's way lower than 2017 and 18 valuations.
• 7:13
  Speaker 1: So actually, nvidia is quite cheap by historical standards.
• 7:18
  Speaker 1: I know it seems kind of like mind-blowing and there is fire coming out of some people's ears, especially Tesla shareholders, who are going don't send all the money to Nvidia, keep some of it in Tesla.
• 7:28
  Speaker 1: But yeah, it's actually not that crazy.
• 7:31
  Speaker 1: I mean, it's not cheap.
• 7:33
  Speaker 1: I'm not saying it is, but it's also not that crazy.
• 7:37
  Speaker 1: What else is good?
• 7:38
  Speaker 1: Well, I don't know if this is good or bad.
• 7:40
  Speaker 1: There's obviously very, very much depends on your point of view.
• 7:43
  Speaker 1: And I don't live in the US, not do I attend to, nor do I vote there.
• 7:47
  Speaker 1: I pay a little bit of tax there, but that's about it.
• 7:50
  Speaker 1: But the real clear politics poll has Trump, the orange one leading Biden by a good 2%, and the market and Wall Street they're quite like it.
• 8:07
  Speaker 1: You know why?
• 8:08
  Speaker 1: Because Trump is seen as the pro-business guy.
• 8:11
  Speaker 1: He's seen as less regulation, pump, baby pump, sorry drill, baby drill and lower tax and just being generally more business pro-business, because he's ultimately originally a businessman and very orange.
• 8:27
  Speaker 1: So that's kind of an interesting one.
• 8:30
  Speaker 1: Obviously, a lot of stuff can happen and a lot of it can change and some of you might be like, no, that poll has manipulated and whatever.
• 8:38
  Speaker 1: But there is, this is also part of the poll.
• 8:42
  Speaker 1: I'd share this.
• 8:45
  Speaker 1: And who do people trust with what issue?
• 8:48
  Speaker 1: So the climate change brigade, the people who don't wash their hair and that kind of thing.
• 8:54
  Speaker 1: They are kidding.
• 8:56
  Speaker 1: Well, they wouldn't want to hurt the climate, so they've probably changed.
• 9:00
  Speaker 1: They trust Democrats.
• 9:02
  Speaker 1: The Ukraine-Russia war crowd somehow trust Democrats more.
• 9:09
  Speaker 1: The healthcare guys, the gun violence warriors, the education fans they trust Democrats.
• 9:16
  Speaker 1: But the people who are more concerned about inflation and the economy and crime and immigration and the Israel war well, they trust Republicans.
• 9:28
  Speaker 1: So the question is, which of these can these befunes make into a bigger issue in 2024?
• 9:34
  Speaker 1: And inflation and the economy is quite a big one.
• 9:39
  Speaker 1: Maybe the inflation thing will go away.
• 9:40
  Speaker 1: It's entirely possible.
• 9:42
  Speaker 1: I think immigration and crime seems to be quite a big one.
• 9:45
  Speaker 1: From the media that I see, and I think people are starting to care a little bit less about the Ukraine-Russia thing.
• 9:51
  Speaker 1: People are ultimately selfish beings and it's far away.
• 9:55
  Speaker 1: Nobody quite knows where it is and definitely nobody cares as much.
• 9:58
  Speaker 1: So that's kind of the question, right?
• 10:00
  Speaker 1: Can they make some of these things like abortion and gun violence and education into a big enough topic for Biden to pull through?
• 10:08
  Speaker 1: I think that's the real question and you might also start to see why the job status have particularly strongly manipulated, sorry, seasonally adjusted what's the word I was looking for by the corrupt?
• 10:23
  Speaker 1: Sorry, and statisticians right, that's the word.
• 10:26
  Speaker 1: So that's something to think about.
• 10:28
  Speaker 1: Stock market probably will like a Trump win, except for Chinese companies.
• 10:34
  Speaker 1: They might not.
• 10:36
  Speaker 1: Is there anything bad that we can come up with today to make ourselves feel a little bit less exuberant?
• 10:42
  Speaker 1: Well, if you look at CTA flows and I put these kind of charts up frequently because I think they're quite useful they basically show you what are the algo funds, what are the dumb computers doing, not hitting my like button.
• 10:56
  Speaker 1: Apparently they buy on technicals.
• 11:00
  Speaker 1: So you get people like Goldman Sachs and Morgan Stanley and some of the big banks estimating every week what the price points are where they're buying and selling, and they probably know they're the brokers.
• 11:08
  Speaker 1: So if we're up big or small, they're gonna buy something like 150 to just under 200 billion.
• 11:21
  Speaker 1: Now if we go down bigly that's an homage to the orange one then they're gonna sell a lot like minus 70 billion or something like that.
• 11:32
  Speaker 1: But nobody expects it to go down because everyone's excited, everyone's just excited, and no one thinks anything's gonna go down, so it would take something unexpected, a small bank failure, we all go yeah, fed's got us covered.
• 11:49
  Speaker 1: What about anything else happening, something breaking?
• 11:51
  Speaker 1: Well, the Fed's probably got us covered, so the outlook is probably pretty good.
• 11:57
  Speaker 1: You have it.
• 11:59
  Speaker 1: You've got a positive, optimistic former banker here.
• 12:02
  Speaker 1: There are not many of us there really aren't.
• 12:04
  Speaker 1: So come and join me, as I'm in such a good mood.
• 12:07
  Speaker 1: In literally 45 minutes, I'll teach you how we make consistent income in four hours a week using just three steps very, very, very simple, easy trading system that I've developed, that I use and teach, and I'll teach it to you for free if you join me.
• 12:27
  Speaker 1: It says next Tuesday.
• 12:28
  Speaker 1: Today is Tuesday, so should not say next, should it?
• 12:31
  Speaker 1: It should say this Tuesday.
• 12:33
  Speaker 1: There we go.
• 12:35
  Speaker 1: It's a seasonally adjusted, manipulated sign there.