Latest / Felix Nikolas Prehn's Podcast / Felix Prehn - U.S. Consumers are collapsing: The Stocks That Will Crash (And Soar) + Stock Market News 24 October 2025

Transcript

Felix Prehn - U.S. Consumers are collapsing: The Stocks That Will Crash (And Soar) + Stock Market News 24 October 2025 · Felix Nikolas Prehn's Podcast

• 0:00
  SPEAKER_00: While the stock market hits all-time highs, there is a financial crisis brewing right under Wall Street's nose.
• 0:06
  SPEAKER_00: And it's about to hit your portfolio harder than you think.
• 0:10
  SPEAKER_00: Credit card delinquencies have doubled.
• 0:13
  SPEAKER_00: Auto repossessions are at 2008 financial crisis levels, and 25% of Americans are now using buy now, pay later just to buy groceries, food.
• 0:25
  SPEAKER_00: I'm going to show you exactly what's happening, which stocks are at risk, and more importantly, where the opportunities are hiding in this chaos.
• 0:33
  SPEAKER_00: Because this is not a dim and gleam video, this is an opportunity video.
• 0:36
  SPEAKER_00: My name is Felix Preen, Meltz Winston back there who does all the research around here.
• 0:40
  SPEAKER_00: I'm an ex-investor banker.
• 0:42
  SPEAKER_00: I've seen how money markets really work from the inside.
• 0:45
  SPEAKER_00: And I'm also the founder of GOAT Academy, where we have over 20,000 students, and the co-founder of TradeVision.io, where we bring news and data of Wall Street quality to the investor in the world.
• 0:58
  SPEAKER_00: At least that's the goal.
• 1:00
  SPEAKER_00: And today I'm going to break down the data that institutional investors are watching.
• 1:05
  SPEAKER_00: I'll show you which sectors are in serious trouble and reveal where the smart money is positioning right now.
• 1:12
  SPEAKER_00: Let me start with something that's going to blow your mind.
• 1:17
  SPEAKER_00: The US economy in 2024 was about$29 trillion.
• 1:22
  SPEAKER_00: For 2025, we're looking at roughly 1.8%, maybe touch more than that in growth, which is about 430 billion extra.
• 1:35
  SPEAKER_00: But here is where it gets interesting.
• 1:46
  SPEAKER_00: Do the math with me here.
• 1:48
  SPEAKER_00: You've got 530 billion minus 400 billion.
• 1:52
  SPEAKER_00: How much does that leave you?
• 1:53
  SPEAKER_00: That leaves you with about 130 billion actual growth in the real economy.
• 2:00
  SPEAKER_00: That's like 0.5% outside of the AI world.
• 2:06
  SPEAKER_00: So the US economy isn't growing, it's being propped up by a handful of tech companies building AI data centers.
• 2:13
  SPEAKER_00: Everything else, it's either stagnant or it's declining.
• 2:16
  SPEAKER_00: And that's why what I'm about to show you matters so much for your portfolio.
• 2:20
  SPEAKER_00: Now there is opportunity in this.
• 2:22
  SPEAKER_00: And before we dive into this further, if you want to learn exactly the strategies that Wall Street uses to find the winning sectors and the winning stocks in any market condition, crisis or not, there's always an opportunity.
• 2:36
  SPEAKER_00: If you want to learn those rules, skills that you can take away forever, then I put together a free training for you.
• 2:43
  SPEAKER_00: It's 15 minutes long, it'll teach you the three rules, and you can access that for free at phoenixfriends.org slash get free.
• 2:50
  SPEAKER_00: The link is the first link in the description.
• 2:52
  SPEAKER_00: All you've got to do is click on that.
• 2:53
  SPEAKER_00: And by the way, I'll do one better for you.
• 2:56
  SPEAKER_00: In addition to those skills I'm going to give you, I'm also going to give you a full research doc workbook for this particular video.
• 3:04
  SPEAKER_00: So everything I'm telling you here is something you can refer to, you can read to, you can go through and explain it to somebody else.
• 3:11
  SPEAKER_00: So it really sinks in.
• 3:12
  SPEAKER_00: And there's a link to that as well down below, FelixFriends.org slash resource, which takes you into our free community where you get all the workbooks and all the educational videos and loads of amazing stuff, uh, plus thousands of wonderful people like yourself.
• 3:24
  SPEAKER_00: So join us over there as well.
• 3:26
  SPEAKER_00: That's completely free.
• 3:27
  SPEAKER_00: Now let's talk about what really is happening to American consumers.
• 3:31
  SPEAKER_00: And this is where it gets a little bit scary, and then it's going to get a little bit more positive.
• 3:35
  SPEAKER_00: I promise you that, right?
• 3:36
  SPEAKER_00: There's not a doom and gloom one here.
• 3:38
  SPEAKER_00: Total US credit card debt just hit$1.2 trillion.
• 3:45
  SPEAKER_00: Maybe I shouldn't put a tick there, but a oh my god, right?
• 3:49
  SPEAKER_00: Sort of a face that looks like a kissing face, but you get the idea.
• 3:53
  SPEAKER_00: That is a 57% increase.
• 3:57
  SPEAKER_00: So it's up 57% since 2021.
• 4:02
  SPEAKER_00: So why does this matter for you as an investor?
• 4:04
  SPEAKER_00: Well, the delinquency rate has doubled.
• 4:08
  SPEAKER_00: In 2021, delinquencies were about 4%.
• 4:13
  SPEAKER_00: Actually, it's tripled.
• 4:14
  SPEAKER_00: It's tripled.
• 4:15
  SPEAKER_00: It's the highest level of delinquencies we've seen in 15 years.
• 4:19
  SPEAKER_00: So think about what that means.
• 4:21
  SPEAKER_00: One out of every eight credit cards here, one in eight is now 90 days past you.
• 4:28
  SPEAKER_00: These aren't people who forget to pay.
• 4:30
  SPEAKER_00: These are people who can't pay.
• 4:32
  SPEAKER_00: So the paycheck to paycheck reality is this 67% of Americans are now living paycheck to paycheck.
• 4:40
  SPEAKER_00: Again, up 4% from last year, but it gets worse.
• 4:44
  SPEAKER_00: 25% of consumers are using buy now pay later services just to buy groceries, not luxury items, not electronics, food.
• 4:54
  SPEAKER_00: And that means that those guys have probably maxed out their credit card, and now they're using buy now pay later as an extra lifeline to feed their family.
• 5:03
  SPEAKER_00: So when a quarter of the population needs to finance their groceries in instalments, that is not an economy that is doing well.
• 5:12
  SPEAKER_00: That is an economy on the edge.
• 5:14
  SPEAKER_00: So why does this happen?
• 5:15
  SPEAKER_00: Well, inflation is crushing the consumer.
• 5:18
  SPEAKER_00: Things like auto insurance are up massively, property taxes are up, health insurance is up massively, home insurance maintenance costs and repairs are up massively, and yes, eggs and groceries.
• 5:29
  SPEAKER_00: And a lot of those are not discretionary expenses, it's not a luxury.
• 5:33
  SPEAKER_00: You have to pay them.
• 5:34
  SPEAKER_00: And they're eating up more and more people's paychecks every single month.
• 5:38
  SPEAKER_00: Just have a look at this.
• 5:39
  SPEAKER_00: It's the canary in the gold mine.
• 5:41
  SPEAKER_00: If you want to know where the consumer crisis is hitting first, look at car loans, auto loans.
• 5:46
  SPEAKER_00: This is your early warning system for what's coming to the rest of the economy.
• 5:50
  SPEAKER_00: And the numbers are pretty brutal.
• 5:52
  SPEAKER_00: Auto loan delinquencies are now 5%.
• 5:56
  SPEAKER_00: That's almost the peak we saw during the financial crisis, which was 5.3%, but very close.
• 6:02
  SPEAKER_00: But here's what's really crazy: one in five new car buyers is now paying over$1,000 per month for their car payments because interest rates have been so high.
• 6:13
  SPEAKER_00: So let me say that again:$1,000 per month, that's$12,000 a year just for car payments.
• 6:18
  SPEAKER_00: And the recovery rate for these guys, when they get their car repossessed, which is obviously not a happy state of affairs, only a third get only a third gets recovered.
• 6:29
  SPEAKER_00: And that means when somebody defaults on, say, a$40,000 car, the bank is only recovering$13,000.
• 6:40
  SPEAKER_00: So they're losing$27,000 per default.
• 6:45
  SPEAKER_00: And most people don't understand this because during the COVID crisis, well, you know, let's not get into that, but the government sent out all these massive stimulus checks.
• 6:54
  SPEAKER_00: A lot of subprime borrowers used that money to pay down debt.
• 6:57
  SPEAKER_00: Suddenly their credit scores jumped from like 600 to 700 plus.
• 7:02
  SPEAKER_00: Banks looked at these scores and were like, great, these are now prime borrowers.
• 7:05
  SPEAKER_00: So they bundled all of these loans into asset-backed securities and sold them as prime loans.
• 7:12
  SPEAKER_00: And that's exactly what happened in 2008, by the way.
• 7:15
  SPEAKER_00: So you have a loan.
• 7:17
  SPEAKER_00: So this is a loan for a guy who's in reality got a 600-point credit score.
• 7:23
  SPEAKER_00: Let's make that a little bit bigger.
• 7:25
  SPEAKER_00: And then you get another loan to another guy who in reality has a 600-point credit score.
• 7:30
  SPEAKER_00: And then you get another one, and you know, he also has a 600-point credit score.
• 7:34
  SPEAKER_00: And then the banks bundle these together.
• 7:36
  SPEAKER_00: In reality, they do this with tens of thousands, and they create one instrument, it's like a certificate, and that says this is an asset-backed instrument that you can invest in.
• 7:48
  SPEAKER_00: Everybody in here actually has 700-point credit scores because they took just the post-COVID post-handout data, and now they're selling that.
• 8:00
  SPEAKER_00: But if in reality they're losing two-thirds of their money on all the defaults, and we have massive defaults, then what do you think happens to that asset-backed security?
• 8:12
  SPEAKER_00: It's not worth what you thought it was worth.
• 8:14
  SPEAKER_00: So who owns these asset-backed securities?
• 8:16
  SPEAKER_00: Well, yes, banks, and they always get bailed out.
• 8:19
  SPEAKER_00: How about pension funds?
• 8:21
  SPEAKER_00: Yeah?
• 8:22
  SPEAKER_00: How about private investors through some sort of fund that you're owning that somebody's investing in?
• 8:29
  SPEAKER_00: So the problem is that these losses feed back into the system and cause real pain, just like they did in 2008.
• 8:38
  SPEAKER_00: It's a dangerous game here.
• 8:40
  SPEAKER_00: So what are they doing with it?
• 8:42
  SPEAKER_00: Well, they're extending these.
• 8:44
  SPEAKER_00: So they're kicking the can down the road, typical Wall Street approach.
• 8:47
  SPEAKER_00: They're extending these loans by basically saying to people, how much can you pay?
• 8:52
  SPEAKER_00: Okay, we'll just modify the loan.
• 8:54
  SPEAKER_00: Let's make this into a seven-year car payment loan.
• 8:58
  SPEAKER_00: And that way you'll pay less.
• 9:00
  SPEAKER_00: Why are they doing this?
• 9:01
  SPEAKER_00: Because they don't want to repossess because they know that repossession is expensive and dangerous, and they're only getting back, you know, 33 cents on the dollar.
• 9:08
  SPEAKER_00: So they don't want to realize it because they'd lose their bonus.
• 9:11
  SPEAKER_00: So they're kicking it down the road for the next generation of bankers to pick up the mess.
• 9:16
  SPEAKER_00: Or maybe you're thinking, well, the economy's gonna get better, it'll be fine.
• 9:19
  SPEAKER_00: Well, actually, it's getting worse.
• 9:21
  SPEAKER_00: You know this company called CarMax?
• 9:23
  SPEAKER_00: One of the biggest used car dealers in America, they just reported their earnings.
• 9:28
  SPEAKER_00: They were ugly.
• 9:29
  SPEAKER_00: Their loan losses jumped to 142 million.
• 9:33
  SPEAKER_00: 26% increase in that.
• 9:35
  SPEAKER_00: What does that mean?
• 9:36
  SPEAKER_00: They're setting aside more money because they expect more people to default on their card loans.
• 9:42
  SPEAKER_00: And you know what the scary part is?
• 9:44
  SPEAKER_00: In Q1 of this year, they said Q1 was going to be the high watermark.
• 9:49
  SPEAKER_00: This was gonna be the worst part.
• 9:52
  SPEAKER_00: They were wrong.
• 9:53
  SPEAKER_00: This was Q1, right?
• 9:55
  SPEAKER_00: Provisions of money.
• 9:56
  SPEAKER_00: So how much money are they setting aside for losses?
• 9:59
  SPEAKER_00: Q2 is a whopping 25% higher.
• 10:02
  SPEAKER_00: So the stock tanked.
• 10:04
  SPEAKER_00: Not a small correction, but we don't really care about that so much.
• 10:06
  SPEAKER_00: Very few of us are invested in CarMax.
• 10:08
  SPEAKER_00: So you connect the dots.
• 10:09
  SPEAKER_00: What have we got?
• 10:10
  SPEAKER_00: We've got credit cards blowing up, we've got auto loans imploding, we've got consumer finance, consumers financing, groceries.
• 10:17
  SPEAKER_00: So, what does that mean for your portfolio?
• 10:19
  SPEAKER_00: You want to take a screenshot of this, you might want to write this down or just get your hands also on the on the resource document for this, so you have all the data on your fingertips.
• 10:27
  SPEAKER_00: Auto retailers and lenders, CarMags, Cabana, auto finance companies, and so on, definitely at risk.
• 10:34
  SPEAKER_00: So if you're holding those stocks, make sure your risk management is watertight.
• 10:38
  SPEAKER_00: Consumer discretionary, I don't tell you what to buy or sell, by the way.
• 10:41
  SPEAKER_00: This isn't financial advice, right?
• 10:42
  SPEAKER_00: I just give you research and data and you've got things between your ears that you can use.
• 10:47
  SPEAKER_00: You want to improve what's in there, then get some skills, get some training, because that's the best way to use that gray matter of hours.
• 10:54
  SPEAKER_00: And you can do that at feedxpence.org slash get free.
• 10:56
  SPEAKER_00: What do you think about discretionary spending?
• 10:58
  SPEAKER_00: What do you think about restaurants, retail, entertainment?
• 11:02
  SPEAKER_00: Those are the sectors that are going to feel the pain.
• 11:04
  SPEAKER_00: And we're already starting to see that in the data.
• 11:07
  SPEAKER_00: And then we have regional banks because they are heavy into those auto loans and the consumer credit exposure.
• 11:13
  SPEAKER_00: Those guys are at risk and we're seeing more and more bad data come out of that sector once again.
• 11:18
  SPEAKER_00: And then we have the consumer finance companies.
• 11:21
  SPEAKER_00: You have firms, your Klana.
• 11:24
  SPEAKER_00: These are the buy now pay later providers.
• 11:26
  SPEAKER_00: And yeah, they'll keep reporting loads of new customers, loads of new deals, you know, it's all up, revenue is up.
• 11:33
  SPEAKER_00: But the AI models are starting to decline more and more transactions because they're seeing the risk.
• 11:37
  SPEAKER_00: And that means less revenue growth ahead and probably more risk on their books.
• 11:43
  SPEAKER_00: So where are the opportunities?
• 11:45
  SPEAKER_00: As I said, there are always opportunities in everything.
• 11:47
  SPEAKER_00: Let me zoom in on this for you.
• 11:49
  SPEAKER_00: Every crisis creates opportunities.
• 11:51
  SPEAKER_00: First of all, discount retailers, dollar stores, warehouse clubs, that sort of thing.
• 11:56
  SPEAKER_00: Because where do you shop when you're broke?
• 11:58
  SPEAKER_00: Discount retailers.
• 12:00
  SPEAKER_00: They actually benefit.
• 12:01
  SPEAKER_00: We saw that beginning of the last crisis, every crisis.
• 12:05
  SPEAKER_00: The debt recovery and collection guys, not that lovely of a sector to be invested in, but yeah, those guys make more money.
• 12:13
  SPEAKER_00: And maybe whether you want to own that or not, it's really up to you.
• 12:16
  SPEAKER_00: Bankruptcy services, yeah.
• 12:18
  SPEAKER_00: Credit counseling, legal service, all those kinds of things do better.
• 12:22
  SPEAKER_00: Now, should you short the market?
• 12:24
  SPEAKER_00: Look, that is for sophisticated investors.
• 12:27
  SPEAKER_00: You've got to be aware that in the long run, the market trends up, so it's a dangerous thing to do.
• 12:32
  SPEAKER_00: But if you really understand what you're doing, it can be a smart thing to do.
• 12:35
  SPEAKER_00: But their timing is really everything, risk management is really everything.
• 12:38
  SPEAKER_00: So you want to be very, very careful with that.
• 12:40
  SPEAKER_00: But yes, there are some over-leveraged consumer finance companies out there that could be candidates.
• 12:45
  SPEAKER_00: So here is what I think is gonna happen over the next to seven six to twelve months.
• 12:51
  SPEAKER_00: We're gonna see more consumer companies report disappointing earnings.
• 12:56
  SPEAKER_00: The Fed's gonna be in a tough spot.
• 12:58
  SPEAKER_00: They basically have to cut rates.
• 13:01
  SPEAKER_00: What do lower rates do?
• 13:02
  SPEAKER_00: Well, they prop up your tech, they prop up your high-risk stocks, your biotechs, all that kind of stuff.
• 13:09
  SPEAKER_00: So it's gonna be good for some sectors because if you're making a biotech company, you don't really care that people are broke because you're charging thousands of dollars for whatever treatment you're selling, right?
• 13:20
  SPEAKER_00: So the market overall might keep going up because AI and tech benefit from this.
• 13:28
  SPEAKER_00: But underneath there's gonna be a lot of carnage and consumer-facing stocks.
• 13:32
  SPEAKER_00: You've got to understand what you own.
• 13:33
  SPEAKER_00: And this is often now known as the K-shaped recovery.
• 13:38
  SPEAKER_00: So the top's doing great, the tech's doing great, AI is doing great.
• 13:43
  SPEAKER_00: Some warning signs on that one, but generally speaking, doing great.
• 13:46
  SPEAKER_00: The wealthy are doing great.
• 13:49
  SPEAKER_00: You know, happy, very happy.
• 13:51
  SPEAKER_00: The bottom, not so much.
• 13:54
  SPEAKER_00: The bottom 25%, actually, I would say the bottom 75%.
• 14:01
  SPEAKER_00: Seriously, bottom 75% of the US is gonna have a tough time.
• 14:06
  SPEAKER_00: Because those are people living on salaries, and that's most people, right?
• 14:10
  SPEAKER_00: Now, if you're an investor, you get into the wealthy zone because asset prices get inflated here.
• 14:15
  SPEAKER_00: So you want to be on the right side of that.
• 14:17
  SPEAKER_00: And then there's one more thing we need to talk about, and it's making everything worse.
• 14:22
  SPEAKER_00: Student loans.
• 14:23
  SPEAKER_00: During COVID, student loan payments were poor.
• 14:26
  SPEAKER_00: Still were promised forgiveness by the Biden administration, and delinquencies weren't being reported to credit agencies.
• 14:33
  SPEAKER_00: That's over.
• 14:34
  SPEAKER_00: Student loan payments are back, and delinquencies are being reported.
• 14:38
  SPEAKER_00: So here's what's happened.
• 14:39
  SPEAKER_00: Someone who had, say, a credit score of 750 during the COVID peak because they were getting, they weren't paying student loans, it wasn't being reported, and they were getting stimulus money.
• 14:53
  SPEAKER_00: Well, their credit score just dropped 200 to 250 points.
• 14:57
  SPEAKER_00: They're now at 500 because the delinquencies are showing up.
• 15:02
  SPEAKER_00: And remember, and remember, you can't discharge student loans even in bankruptcy.
• 15:06
  SPEAKER_00: The government can garnish your wages if you don't pay.
• 15:09
  SPEAKER_00: So now consumers are making a choice: do I pay my student loan or pay my car payment?
• 15:14
  SPEAKER_00: Do I pay my credit card or do I buy groceries?
• 15:16
  SPEAKER_00: That's why I'm using BMPL.
• 15:18
  SPEAKER_00: And this is what we're seeing, this cascade effect.
• 15:21
  SPEAKER_00: It's not just one type of debt, it's all types of debt hitting at once.
• 15:26
  SPEAKER_00: And when your credit card and when your credit score drops 200 points, here's what happens: your credit card company cuts your credit limit.
• 15:33
  SPEAKER_00: Your interest rate just goes gone up.
• 15:35
  SPEAKER_00: You can't refinance your car loan and you can't get approved from new credit.
• 15:39
  SPEAKER_00: Buy now pay later services start declining your transactions.
• 15:43
  SPEAKER_00: It's a spiral, a downward spiral.
• 15:47
  SPEAKER_00: And millions of Americans are in it right now.
• 15:50
  SPEAKER_00: So let's bring it all together and make this useful for you.
• 15:53
  SPEAKER_00: The US economy is being held up by AI spending from a handful of tech companies.
• 15:57
  SPEAKER_00: And let's not even get me started on the almost 2 trillion government deficit.
• 16:02
  SPEAKER_00: That's holding up the rest of it, by the way.
• 16:03
  SPEAKER_00: You take that away and you'd be in a massive obsession.
• 16:05
  SPEAKER_00: But the average American consumer is drowning.
• 16:08
  SPEAKER_00: Credit card delinquencies have doubled.
• 16:10
  SPEAKER_00: Auto loan defaults are at financial crisis level, and 67%, yeah, 67% are living paycheck to paycheck.
• 16:18
  SPEAKER_00: A quarter of Americans are financing groceries with buy now pay later, which means their credit card's probably maxed out.
• 16:25
  SPEAKER_00: Something's gonna break.
• 16:26
  SPEAKER_00: So what do you need to know?
• 16:28
  SPEAKER_00: Well, here is my action plan for you.
• 16:31
  SPEAKER_00: Review your portfolio, check any consumer discretionary holdings you have in there, and then look for opportunities.
• 16:38
  SPEAKER_00: Discount retailers could be a great place to invest right now.
• 16:41
  SPEAKER_00: Stay informed.
• 16:43
  SPEAKER_00: What I would do is, and that's what I've done, I've taken all my stocks, I put them into TradeVision, which is a platform we built, and you make a watch list with all your stocks, and then you just turn on the news notifications, and that way you get news pop-ups literally on your phone, and they look like that.
• 16:59
  SPEAKER_00: Only for your stocks.
• 17:00
  SPEAKER_00: So now you know what's happening live as it's happening.
• 17:03
  SPEAKER_00: Saves you a ton of time because you now no longer need to watch the news.
• 17:06
  SPEAKER_00: And you don't get to live, you know, all that drivel and dross and woke bollocks and politics from the mainstream media.
• 17:13
  SPEAKER_00: So the bottom line, Wall Street makes money when Main Street collapses, right?
• 17:17
  SPEAKER_00: So where do you want to be?
• 17:18
  SPEAKER_00: Well, you could be demonstrating against the unfairness of it, I get it.
• 17:21
  SPEAKER_00: But really, the smarter thing to do is just you want to be an investor.
• 17:26
  SPEAKER_00: That's the wrong link.
• 17:27
  SPEAKER_00: You want to be an investor and just own the right kind of sectors and the right kind of stocks, and you actually benefit from this and you come out wealthier, right?
• 17:35
  SPEAKER_00: And then you can do whatever you want with that money and you can help people make an impact and so on.
• 17:39
  SPEAKER_00: And that's a wonderful thing to do.
• 17:41
  SPEAKER_00: You want to learn the strategies that Wall Street uses, the strategies that I use, that my mentors use, and how to do that, go to feedixfriends.org slash get free.
• 17:50
  SPEAKER_00: Learn the three rules and keep up some value out of this.
• 17:54
  SPEAKER_00: Share with somebody else.
• 17:55
  SPEAKER_00: You might have some value in it too.
• 17:57
  SPEAKER_00: All the best.