Latest / Financial Survival Network / Unpacking Consumer Confidence: Tackling Market Bubbles and Warning Signals - Eddy Gifford #6033

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Unpacking Consumer Confidence: Tackling Market Bubbles and Warning Signals - Eddy Gifford #6033 · Financial Survival Network

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  It could definitely get to the point to where the gold and the guns are
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  the things that are the only things that have value. We keep trying to
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  it just feels like we're trying to inflate our way out of this bubble.
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  And if we inflate our way out of this bubble, that that's going to
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  be good for commodities, and nobody holds commodities. You are listening to Carrie
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  Letz's Financial Survival Network, where you get valuable information. You just can't find
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  anywhere else to thrive in today's trying times. You need the Financial Survival Network
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  now more than ever. Go to Financial Survivalnetwork dot com and get your free
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  newsletter and gift. Financial Survival Network now more than ever. And welcome.
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  You are listening to and watching the Financial Survival Network. I'm your host,
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  Carrie Letz. Well, whole consumer confidence. Evidently the consumers are a lot
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  more confident than the economists, then the investors, then the politicians. What
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  does the consumer know that we don't know? Our good friend Eddie Giffert is
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  here now to give us some insight. So consumer confidence actually increased in February.
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  What do they know? Yeah? I mean I don't think they know
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  anything. I think that that's the problem. When you look at it over
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  the last couple of months, like we're relatively flat. We've been in this
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  kind of like sideways action going on if we're looking at it from a charting
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  standpoint, But when you look like kind of deeper into the details, there's
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  two components. There's what we call the present situation index, and there's what's
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  called the expectations index, and the present situation. For whatever reason, consumers
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  are just like they're content, they're happy. I mean, the stock markets
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  up this year. Maybe they're looking at their portfolios and they're like, oh,
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  we see green, everything's good. But when you ask those same consumers
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  the question of hey, what do you think things are going to be like
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  in six months, that the mood changes. We've seen that continuously get repised.
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  If you look at last month, the expectation was seventy six point three,
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  and this month that's at seventy three point eight, And so we're in
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  a situation where anything under eighty typically says, hey, recession coming, and
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  that thing is trending downward. And so I think that the consumer is just
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  a little bit happy, a little to you for it probably like everybody else,
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  because we've had a good run up in the markets. But as we've
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  talked about on this show several times, Carrie, the bubbles feed themselves until
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  they don't, and when they don't, it's it's very harsh. And there
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  we are in every definition of a bubble right now. So when that pops,
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  you're going to just see consumer confidence get crushed. The interesting thing is
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  it's hard to know what the overall reaction is going to be. Like,
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  we know that equities stock market will get crushed in that scenario. What we
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  don't know is how bonds will react, because generally speaking, it's always been
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  Hey, things get really bad, just put your money in bonds and we'll
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  go back up. But it appears that the FED is more comfortable with higher
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  inflation levels, and if we maintain higher inflation, that's going to potentially push
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  interest rates up more, which is bad for bonds. So could this be
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  like an everything collapse again, just like a two x or three is compared
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  to twenty twenty two. Unfortunately, I think that is on the table.
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  I don't want it to be what I think it is. Hey, So
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  in the meantime, gold is hit a new all time bio last week broke
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  twenty two hundred dollars. Bitcoin made a bunch of new highs Now it's pulled
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  back. It's only it's seventy thousand. What are you making of those markets
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  their response to as opposed to the consumer confidence number. I think gold,
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  Gold is always the one that you just have to pay attention to, and
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  I think that gold is sending us some warning. It's been kind of you
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  know, glow if you will, for the last couple of months, and
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  we kind of it kind of hit a breakout, it's kind of consolidating,
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  and now we're seeing it start to trend up again. That's not good.
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  When you look at inner market relationships and you look at how things tend to
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  react and everything, gold tends to be a leading indicator, and so gold
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  is running up, that means that there's probably something bad on the surface.
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  So maybe the consumers do have it right from a six month standpoint, But
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  I think the problem is is we've been in such this fear of missing out
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  fomo type investment mentality that everyone just keeps chasing. And I mean, I'm
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  starting to get stock tips from my clients, which anytime that happens. That's
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  when it starts to be like, wait a minute, I'm the advisor here,
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  and so it's very important to start at that you don't already use it,
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  start implementing risk management now, because you can't do it after everything falls.
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  You have to that, you have to do it now. And gold
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  is is definitely coming to us something bitcoin. Big coin's a different one.
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  It sometimes it acts like gold, sometimes it acts like just a pure spec
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  play and and the h I feel like it's been more speculative recently that obviously
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  we've got the spot ATFS they're live and active. Now, we've got the
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  media and everyone's circling around the having an event that's going to happen next month.
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  And we've got Michael Sailor at micro Strategy borrowing money to buy more big
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  coin, borrowing money to buy more a big coin it seems like every single
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  week ago. So you know, there's there's there's definitely there may be some
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  underlying value there, but there's definitely a little bit of a pump going on
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  in that space. Doesn't mean you can't ride the wave, just means that
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  you have to make sure that again risk management. You got to have your
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  your exits in place. Okay, So so looking at this, uh,
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  you know, you really think that a collapses in I don't know how we
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  avoid a credit event. I mean, short of the FED stepping in and
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  lowering everything back to zero so that they have no type of obligation on the
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  other side, as far as like making interest payments on our debts, that's
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  about the only thing I feel like they could do to kind of salvage anything
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  short term. But the issue with that is that's just going to lead to
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  higher, more rampant inflation, and that's just going to cause the consumer to
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  collapse. And so I think that a credit you know event is coming.
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  I don't know if that's in three months or if that's in eighteen months.
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  I think that they from a political standpoint, everyone would prefer for it to
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  happen and after the election, not before. It's it's way too easy to
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  blame if it happens before. So I think that that's where we're at.
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  There's just a lot of stuff under the surface that continues to flicker. We've
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  seen a lot of risk off type signaling and then the next week everything's riskne
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  again, and so like we're definitely like flickering back and forth between risk off
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  Risponde. Risk off ER's gone. But I think that the tell tale is
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  what's going on with all and so we can see to see gold ryans,
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  then we're going to see something and when it happens is going to be very
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  painful unfortunately. All right, So hey, so we're looking at this thing.
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  Obviously a creditive that means a banking event, doesn't it. Yes,
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  yes, And you look at hundreds of banks that are literally hanging on by
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  their fingernails now. And the last fed addressed by Chairman Powell to Congress,
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  he said, you know, he kind of let it out there that there's
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  a lot of banks that are going to be merged in and taken over and
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  all this. You think it's going to spread to the major banks as well,
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  on any center banks as we used to call them. It seems like
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  it could. I mean, I don't know how greedy some of these bigger
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  banks have been. Obviously, if a consolidation occurs and we see a lot
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  of these regionals fold into these big banks, then absolutely it's gonna spill over
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  because you can only have so much poison before everything is poisoned. And and
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  and that's kind of what we're looking at. You look at the classic example
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  of New York Community Bank. Last year, they came to the rescue,
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  and now it looks like they're gonna be the next one to fall. So
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  even though they've gotten private investment and UH and help that it looks that that
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  stock price just keeps turning down. Where the regional bank et is not much
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  higher than it was when it originally like just got crushed last year at this
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  time, and the backstop is no longer in place for a lot of these
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  banks. So h there is a consolidation, and we do see the big,
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  the big banks absorbing these regional banks. I think that that's going to
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  spell tr for some of these big banks, maybe not the biggest, biggest,
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  But you're still in a situation where it looks like financials look good right
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  now, technology look good right now, like they look good, but they
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  look good into until they don't. So you just got to make sure that
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  you're you have some uncorrelated stuff in your portfolio. You got to make sure
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  that you've got stops in place to protect yourself when things go bad. All
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  right, So what about Ai here? Uh is AI got to save us.
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  I mean that the media is telling us that, right, the AI
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  is, Oh, they're always right. Isn't the media always right? So
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  the issue with AI is is that we're seeing it in a very one dimensional
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  phase right now. And what I mean by that is, if AI is
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  truly going to be this extreme deflationary measure, then we should see that spilling
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  over into interest rates and treasuries. We just see that spilling over into other
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  assets like small like small companies, and we just don't see that. If
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  you look at the Russell two thousand is an example, the only reason it
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  has it saved any face this year is because it had super microcomputers and micro
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  strategy in it. If you if you take those two out, it's getting
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  crushed this year. And a lot of these small and medium sized companies still
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  haven't even gotten clothes to their highs that they achieved in twenty twenty one.
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  And so we are in this very very concentrated market and that and that that
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  typically always fells trouble. Okay, So again we go back here, Uh
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  so gold guns and god huh and so that basically, you say, it
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  seems to be the theme every time that we talk Carrie, the value.
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  It could definitely get to the point to where the you know, the gold
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  and the guns are the things that are the only things they have value.
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  We keep trying to it just feels like we're trying to inflate our way out
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  of this bubble. And if we inflate our way out of this bubble,
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  that that's going to be good for commodities. And nobody holds commodities. I
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  mean, I mean, yeah, everyone, everyone has the s MP five
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  hundred sectors. No one of the all owns commodities. I mean Coco,
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  Oh my gosh, I don't know if you saw Coco this week. Goo
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  is like just exploded to the upside. And that's not good. That that
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  that is telling us that more warnings gold and commodities are telling us inflation super
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  cycle and nobody wants to believe it. Let's not forget our good friend and
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  colleague, doctor Copper wrote four bucks again this week. Last week, I
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  think it was loud it is true, or maybe it was yesterday. Now
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  it's let trading slightly under, but it's been creeping up. And inflation is
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  always going to rear its ugly head when it comes to Copper, because you
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  know, copper. Is it that is the ultimate surrogate for the economy.
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  You know, I'm kind of amused your financial plan. I don't hear many
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  financial planners telling their clients to put a portion of their holdings into precious metals
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  and maybe some into cryptocurrencies, although that's changing now and some ballistic precious metals.
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  You know, that's you're kind of the unusual in that regard. Eddie.
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  Well, well, we like to think we're different. I mean,
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  I'm of the standpoint of them. I'm really big in the portfolio construction.
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  And it may sound weird, but if there's not read in the statement,
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  you're not truly diversified. And so when we have the big years and like
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  we did in technology and we're eighty percent stock and twenty percent equity, metals,
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  gold, whatever, that's okay because we want some true installation in the
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  portfolio, regardless of what the cause is. And bonds used to be that
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  they were that during the bond bullmarket. It basically has happened over the last
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  thirty years. While the blond bull market has been over for two years,
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  and you've got to be looking at other things, whether that's commodities or you
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  know, managed futures or our place that we like to look because they typically
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  are trending on commodity needs. Uh, those are places that can really help
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  save you if something bad really does happen. And the bitcoin stuff, we've
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  been we've been watching that and testing that for over a year and implemented that
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  for clients this year. Get some of that into the portfolio just as a
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  diversifier and you know, give you some significant upside potential. But sure also
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  we like it when stuff goes up at different times and and most portfolios now
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  we're so correlated that markets are up, ya, we're winning, markets are
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  down. Oh my gosh, it's not good. And we like to make
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  sure that we're trying to balance that out. And the old school fixed income
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  exposure just isn't doing it in this environment and it won't do it if inflation
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  continues to re exigly ahead. Okay, all right, very enlightening. Tell
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  us where we find you. Yeah, at tactic Weal dot com backslash Eddie
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  dash Gifford. You can always email me in of it. You have that
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  too, Just Eddie dot Gifford at tactiwalk dot com or just go ahead and
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  jump on and then google Eddie Gifford and I'm sure that you'll see not only
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  this show that we're on today, but all the other ones that we've been
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  on together so well. Better than that, we've got a link to your
• 14:24
  site in the show notes this interview on Financial Survival Network dot com and why
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  don't you sign up for your free newsletter when you're on the site. And
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  if you've got a question over Eddie or myself, shoot me an email kl
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  at Carrie LEDs dot com. Eddie, great catching up with you. We'll
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  talk to you again real soon. Appreciate it. Thank you, thanks for
• 14:43
  listening to Carrie Lets's Financial Survival Network, your solution to today's trying times.
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  For the latest, go to Financial Survivalnetwork dot com. Financial Survival Network now
• 14:56
  more than ever, Cruis