Latest / Felix Nikolas Prehn's Podcast / Banks Just Warned Big Clients... + Stock Market News 12 April 2024

Transcript

Banks Just Warned Big Clients... + Stock Market News 12 April 2024 · Felix Nikolas Prehn's Podcast

• 0:00
  Speaker 1: What have we got in store today?
• 0:01
  Speaker 1: We have pretty terrifying bank earnings from JP Morgan and I know you're all very, very worried about JP Morgan's bankers getting less bonuses at the end of the year.
• 0:11
  Speaker 1: Real tragedy, right, the sale in Ferraris and yachts might actually decline.
• 0:17
  Speaker 1: House prices in Connecticut are teetering on the brink.
• 0:20
  Speaker 1: So it's a real disaster that one.
• 0:22
  Speaker 1: But I actually want to talk to you about some other trade opportunities.
• 0:26
  Speaker 1: I want to walk through Apple.
• 0:28
  Speaker 1: I want to walk through what the Fed just said yesterday.
• 0:31
  Speaker 1: So you are the best informed investors out there.
• 0:34
  Speaker 1: That's really what our mission is here and if you enjoy it, you know what to do.
• 0:38
  Speaker 1: Smash the like button.
• 0:40
  Speaker 1: Apparently, detroit is a terrible place to be.
• 0:42
  Speaker 1: If I follow what the chat says, I've never been.
• 0:45
  Speaker 1: I can't say that I have real intentions on going either.
• 0:48
  Speaker 1: If you haven't already get your hands on my 54-page it's almost like a mini e-book really.
• 0:56
  Speaker 1: On moats, if you want to know what are the best stocks to buy that have the biggest margins, the biggest defense, that can't really be eroded in terms of competition, go to felixfrenzorg slash moat and I'll walk you through what moats are and how to spot them, how to identify them, and you can identify them in growth stocks and established stocks and everything else.
• 1:19
  Speaker 1: So get your paws on this document.
• 1:21
  Speaker 1: Felixfrenzorg slash moat M-O-A-T.
• 1:26
  Speaker 1: Let's look at a couple of key things here.
• 1:28
  Speaker 1: Do you want to look at the pre-market first?
• 1:29
  Speaker 1: Maybe just a little glimpse to spoil the morning.
• 1:33
  Speaker 1: The big boys are down.
• 1:34
  Speaker 1: The Googles, the Metas, the NVIDIAs are down a percentage point, tesla down 1.2%, jp Morgan down a whopping 3.6%, because net interest income is disappointing, apparently over at JP Morgan and we'll have a look at a bit more detail of that and that's sort of dragging the whole banking sector down along with it.
• 1:53
  Speaker 1: But what's really happening here today?
• 1:56
  Speaker 1: Oh yes, if you want to come and learn with us, you want to come and learn how we make money, how we make over 100% return on capital employed in each of the last two years and how we're up fairly nicely so far this year something like $5,000 on a 30K portfolio.
• 2:14
  Speaker 1: Then come and join me on Tuesday evening and learn my three-step trading process.
• 2:22
  Speaker 1: And it's simple, it's easy, you don't need to know anything for it.
• 2:24
  Speaker 1: That's the promise.
• 2:25
  Speaker 1: And it's simple, it's easy, you don't need to know anything for it.
• 2:27
  Speaker 1: That's the promise, and I will teach the whole thing.
• 2:29
  Speaker 1: You walk away with all that knowledge.
• 2:31
  Speaker 1: There's zero clear charge for that.
• 2:33
  Speaker 1: As usual, phoenixfriendsorg slash webinar Link is down below for that too.
• 2:38
  Speaker 1: Okay, have a quick glimpse here at you know, tesla, obviously the future, all other car companies a load of junk.
• 2:45
  Speaker 1: Well, the market disagrees in 2024.
• 2:48
  Speaker 1: Toyota is up 34%, ferrari up 24%, general Motors up 22%, honda up 18%, and so on.
• 2:57
  Speaker 1: Tesla at minus.
• 2:59
  Speaker 1: Well, with this morning's dip about minus 30% down.
• 3:03
  Speaker 1: So at what point does this become an interesting story?
• 3:06
  Speaker 1: I think it is at a point where it is an interesting story and I like Tesla a lot more where it is right now than when it was a lot more expensive.
• 3:14
  Speaker 1: And Wall Street tends to agree and is basically saying the hedge funds are nibbling and patience is required.
• 3:24
  Speaker 1: Why is patience required?
• 3:25
  Speaker 1: Because all that robo-taxi thing, all that full-service driving, all of that, it isn't going to come anytime soon because you need regulators that's the government to jump on board with it, and that'll take a while.
• 3:39
  Speaker 1: We are.
• 3:40
  Speaker 1: Are we in the middle of the month, in the middle of the?
• 3:44
  Speaker 1: No, I'm in the middle of the month, in the middle of the.
• 3:46
  Speaker 1: No, I'm in the middle of the month Almost On Sunday.
• 3:47
  Speaker 1: We are On Monday we are.
• 3:48
  Speaker 1: So we're here here now.
• 3:50
  Speaker 1: This is us, right Us.
• 3:51
  Speaker 1: In three days we hit the second half of the month, which traditionally is a much better half the month than the first half, so it's really the better half In this case.
• 4:03
  Speaker 1: Why Taxes, my friends?
• 4:05
  Speaker 1: You Americans apparently pay taxes lots of them around this time of the year and once you've paid the taxes, you put money back into the market.
• 4:13
  Speaker 1: I think that's basically how it works, and so therefore, from the 15th onwards, traditionally markets are improving, which is nice.
• 4:21
  Speaker 1: So if you want the market to improve, you know what to do.
• 4:24
  Speaker 1: All you got to do is smash that like button NASDAQ, sort of hanging around the 50-day moving average line here.
• 4:32
  Speaker 1: We'll have a look at that on the live market in a second, but that's an important line to hold.
• 4:36
  Speaker 1: We really do want to hold that.
• 4:38
  Speaker 1: If we don't, bad things happen like they did last August, september and October.
• 4:44
  Speaker 1: But let's talk a little bit about our grown up friend, apple.
• 4:48
  Speaker 1: And Apple has these lovely support levels down here at around 168 and a bit, and we've hit those once, twice, three times, four times.
• 5:02
  Speaker 1: We bounced off each time.
• 5:04
  Speaker 1: So what does this stock do?
• 5:05
  Speaker 1: This is a mean reverting stock.
• 5:08
  Speaker 1: It goes down, it goes back into the middle down, back into the middle down.
• 5:13
  Speaker 1: It overdoes it a bit.
• 5:14
  Speaker 1: It goes back into the middle.
• 5:15
  Speaker 1: It goes up again, it goes down to the middle.
• 5:17
  Speaker 1: It overdoes it a bit and it tends to go back into the middle.
• 5:19
  Speaker 1: So I have no understanding why some people are saying down here, let's short Apple.
• 5:25
  Speaker 1: Apple is going to go all the way down.
• 5:27
  Speaker 1: I think from a chart point of view, it's utter nonsense.
• 5:29
  Speaker 1: In fact, I'll put out a whole video later today where I'll walk you through my trade for Apple, because I'm thinking of this very, very differently to some people and I think the hedge funds are with me on that.
• 5:40
  Speaker 1: In fact, shall we have a look at what the market's doing on Apple?
• 5:43
  Speaker 1: So we'll look at what the market's doing on Apple.
• 5:47
  Speaker 1: Let's have a look on optionswatchio.
• 5:48
  Speaker 1: So we click on smart money here in the top right and then we type in AAPL.
• 5:55
  Speaker 1: What went on yesterday?
• 5:56
  Speaker 1: People buying puts, that's insurance.
• 6:03
  Speaker 1: Where are we trading puts above the market?
• 6:08
  Speaker 1: Okay, selling puts, buying puts.
• 6:12
  Speaker 1: So most of the market is still fairly in fairly defense mode.
• 6:15
  Speaker 1: So about a 100 million give or take, they're being being defensive.
• 6:19
  Speaker 1: No one buying call options.
• 6:21
  Speaker 1: Yet, interestingly enough, oh, here is somebody six million dollars for september this year and a 75 call option.
• 6:31
  Speaker 1: It's more the kind of thing I'm looking at.
• 6:34
  Speaker 1: To be honest with you, that's more the kind of thing that I'm looking at, but no, the market hasn't broadly done it yet.
• 6:39
  Speaker 1: We'll keep an eye on that here for the next couple of days.
• 6:42
  Speaker 1: You can get your pulse on this.
• 6:43
  Speaker 1: These are dark pool trades.
• 6:45
  Speaker 1: These are trades that you don't see and this is what institutions are trying to hide from you.
• 6:50
  Speaker 1: We make it available to you.
• 6:51
  Speaker 1: So if you head over to optionswatchio, you get your pause on that.
• 6:54
  Speaker 1: I'll put.
• 6:55
  Speaker 1: Go back to our little chat here.
• 7:06
  Speaker 1: Apple is launching the iPhone 693.
• 7:10
  Speaker 1: No, sorry, it's the iPhone 16, I believe, and those are typically quite good events.
• 7:16
  Speaker 1: This was the Apple 11 launch.
• 7:20
  Speaker 1: This was the 12 launch.
• 7:22
  Speaker 1: Still gave a fairly nice kicker there, and Wall Street is generally not very good at getting Apple right.
• 7:36
  Speaker 1: They tend to underestimate them very significantly in terms of margin, very significantly in terms of margin.
• 7:44
  Speaker 1: And if you look here at Apple plans to overhaul the entire Mac line as well with the AI-focused M4 chips, and quite a few people on Wall Street are saying they expect just some of the iPhone sales you got.
• 7:59
  Speaker 1: Think this through you have 1.3 billion people who have an iPhone right now I don't Samsung, but you get the idea.
• 8:08
  Speaker 1: People replace them when a new model comes out, and that could be, according to analysts estimate, something like 250 million of these phones being replaced, which is pretty nice.
• 8:21
  Speaker 1: So that could be a real revenue boost.
• 8:23
  Speaker 1: You could actually see iPhone sales pick up once again.
• 8:27
  Speaker 1: So I am not bearish on Apple.
• 8:32
  Speaker 1: I guess that's what I'm trying to say.
• 8:39
  Speaker 1: In terms of rate cuts, the market is now expecting less than two rate cuts, so 1.7 cuts, something like that.
• 8:42
  Speaker 1: Why does this not matter as much?
• 8:45
  Speaker 1: Because the reason we're not getting cuts is what?
• 8:49
  Speaker 1: Allegedly a strong economy.
• 8:53
  Speaker 1: What does a strong economy mean?
• 8:54
  Speaker 1: It means the consumer is buying lots of stuff.
• 8:56
  Speaker 1: It means companies are investing in everything else, so it's not so bad, is it?
• 9:01
  Speaker 1: And then I think everybody still has the hope that a bank will fail and we'll get more rate cuts anyway.
• 9:07
  Speaker 1: So if we genuinely have a strong economy and I have some doubts on that, but if that is the case and we get less rate cuts for that reason, then it isn't really as big a problem as you might think It'd still be nice for some of our fintech stocks and our growth stocks to have more rate cuts, but overall, for the big boys the Microsofts and Apples and so on it probably won't matter very much.
• 9:30
  Speaker 1: So that's one thing to understand.
• 9:31
  Speaker 1: Jp Morgan and hedge funds are saying they're liking Apple because it's underperforming the market very significantly.
• 9:40
  Speaker 1: It's only up about 5% or so since what was that?
• 9:43
  Speaker 1: April 2023, whereas the Nasdaq's up something like 40%.
• 9:49
  Speaker 1: And they're basically saying here hedge funds and investors are increasingly warming up to the opportunity of the AI upgrade cycle, so people are having to upgrade their MacBooks and their iPhones because it won't work with the latest bit of software, because the chips aren't fast enough, and so I am quite liking Apple here.
• 10:09
  Speaker 1: As I said, I will put out a video on that later on today.
• 10:11
  Speaker 1: So make sure you smash the you-know-what.
• 10:14
  Speaker 1: What about the Fed?
• 10:15
  Speaker 1: He looks like a happy chap, doesn't he?
• 10:17
  Speaker 1: John Williams, he says inflation has ways to go to get to 2%.
• 10:23
  Speaker 1: What a glorious observation.
• 10:26
  Speaker 1: Who would have thought?
• 10:26
  Speaker 1: But he says there's no need to cut in the very near term.
• 10:30
  Speaker 1: But actually the term very makes me feel more bullish because he's saying there is a need to cut, just not tomorrow.
• 10:36
  Speaker 1: And yeah, there's no clear need to adjust policy in the very near term.
• 10:43
  Speaker 1: As we collect more data I'll be able to assess have we got the confidence?
• 10:47
  Speaker 1: Inflation is moving back to 2% and you also said there'll be bumps along the way, which essentially is saying we're okay with a bit of worse data, a bit of better data, a bit of worse data.
• 10:58
  Speaker 1: So I think the market can kind of take a bit of a chill pill on this.
• 11:01
  Speaker 1: Feds Collins also says data may warrant later fewer cuts, later this year.
• 11:08
  Speaker 1: So everybody is fully agreed on great cuts this year.
• 11:11
  Speaker 1: It's really just a question of how many.
• 11:13
  Speaker 1: Now note he says does he say plural on cuts recognizing and less than previously warranted?
• 11:25
  Speaker 1: Now in December him and his fellow nutters thought there'd be six cuts.
• 11:30
  Speaker 1: Now they're saying there'd be three cuts.
• 11:32
  Speaker 1: So they're not really saying anything particularly new.
• 11:36
  Speaker 1: They're just saying they're going to be patient and you don't need an urgency and everything else, but that policy is on a path and we are well positioned to manage risks.
• 11:45
  Speaker 1: So I don't think this really means anything.
• 11:47
  Speaker 1: I think this is all good.
• 11:49
  Speaker 1: I think this is all good and I think the market can relax a little bit.
• 11:52
  Speaker 1: To be honest with you, and I think it probably will.
• 11:54
  Speaker 1: That's my view on that.
• 11:55
  Speaker 1: But USPPI, which we had out, which I thought was pretty good even though, yeah, I thought it was pretty good and it's the stuff that the Fed actually looks at where we're soft up.
• 12:06
  Speaker 1: So that's really what matters here.
• 12:08
  Speaker 1: So, from a Fed point of view, the inflation data was pretty good.
• 12:18
  Speaker 1: President John Williams said tremendous progress have been made.
• 12:21
  Speaker 1: So I don't think the Fed's being particularly hawkish.
• 12:24
  Speaker 1: I think people are just like a little bit on the edge of their seat, because JP Morgan reports an NII-MIS, which is net interest income.
• 12:35
  Speaker 1: They only made $23 billion in the first three months of the year on screwing depositors.
• 12:42
  Speaker 1: That's you, if you have a JP Morgan account or a Chase account out of interest, that they should have been paid, which, of course, is a glorious business model.
• 12:50
  Speaker 1: They're still going to make about $90 billion from this for the year.
• 12:54
  Speaker 1: Adjusted expenses could come in at $91 billion, a little higher than expected, and I think they're putting some money aside.
• 13:08
  Speaker 1: Isn't that what this is all about?
• 13:09
  Speaker 1: They're being a bit more cautious.
• 13:10
  Speaker 1: The investment bank is making $2 billion above others' expectations.
• 13:22
  Speaker 1: Revenue fell 5% less than expected.
• 13:26
  Speaker 1: Fixed income trading beat estimates.
• 13:28
  Speaker 1: So the traders are making money, as always, which is what we really are looking for.
• 13:33
  Speaker 1: What do you think of the moat ETF?
• 13:35
  Speaker 1: Well, mike, what I would suggest you do is read the moat document and then go through links down below felixfrancelockcom and then go through at least the top 10 holdings of the moat ETF and see whether you agree that those companies have a real moat.
• 13:50
  Speaker 1: And if you agree, then it could be a reasonable place to be.
• 13:53
  Speaker 1: And obviously, look at expenses.
• 13:54
  Speaker 1: They want them to be really, really, really low.
• 13:56
  Speaker 1: Otherwise you're just paying somebody else, the Knights of St Nii, indeed, logan Nii, I'm very quiet today, says Floten, am I?
• 14:07
  Speaker 1: You're the same chap you said that yesterday.
• 14:12
  Speaker 1: Anybody else thinks I'm very quiet.
• 14:13
  Speaker 1: I'll move the mic a little closer.
• 14:14
  Speaker 1: Wouldn't want you to miss a word of this wisdom now, would we?
• 14:18
  Speaker 1: And um, china is, yeah, looking to encouraging companies to replace amd and intel chips with domestic chips, which just makes sense.
• 14:31
  Speaker 1: The US is saying exactly the same thing, so it's just what happens when you kick it off.
• 14:36
  Speaker 1: So not exactly hugely surprising.
• 14:38
  Speaker 1: But, yes, amd not loving it down 2.8% this morning.