YT YouTube2Text

YouTube2Text → Transcripts → Stocks Surge on Soft Inflation Data

Stocks Surge on Soft Inflation Data — Transcript

by RiskReversal Media · 7,423 words · 1,006 segments · language en · Watch on YouTube

Open in transcriber Summarize with AI Download SRT/VTT

Full transcript

0:00out and let's talk about it kidding
0:02obviously the market is the lead Dan
0:04Nathan yeah I mean listen guy you say
0:07this all the time in a while actually
0:09which I think is really important I
0:10think you have a good track record doing
0:12this you're gonna say today is a day
0:14that I think you want a bookmark right
0:17you want to kind of remember this day
0:19because this is really listen there have
0:21been bits of soft inflation data here
0:25okay that that's basically kind of LED
0:27investors to think that maybe the FED
0:30could take their foot off the pedal a
0:31little bit here over the course of let's
0:33say the last six months or so but
0:35today's reaction not just in the stock
0:38market but also in the bond market is
0:41pretty powerful when you put those two
0:43things together you see here's a couple
0:45hot takes that we have over the the
0:47Twitter machine from some people that we
0:49follow quite uh closely you know the
0:52fed's semester saying that listen one
0:54piece of data I'm paraphrasing here does
0:56not make a pivot is that what you would
0:59kind of uh take away from nestor's
1:01comments on CNBC you know this is yes
1:03and this is how I would sort of sent
1:05this size it I'm sure behind closed
1:07doors they're thrilled that things are
1:09trending the right way but they also
1:11want to say listen let's not get ahead
1:13of ourselves you know let's continue to
1:15focus on things we want to make sure we
1:17get this under control so they're saying
1:19all the right things they're having the
1:21data gives them the latitude I think to
1:24speak a bit more hawkish so it's working
1:26out and I want to be very clear I mean
1:29it is working out I think their ability
1:31to vocalize and explain what they're
1:33trying to do I think they've done a much
1:35better job over the last few months what
1:37the market does what is is what the
1:39Market's going to do but I think they've
1:40all been pretty much on the same page so
1:43this number softer than expected still
1:47elevated again gives them a little
1:49attitude to speak as hawkish as they
1:51want to speak that's my interpretation
1:53yeah and I guess what what the bond
1:55market is saying and if you look at the
1:57CME fed watch tool you know we have this
1:59meeting coming up in a few weeks in
2:00December here and it looks like very
2:02squarely that a strong likelihood of
2:05only 8 50 basis point hike and again I
2:07mean this is one of the reasons why you
2:09know if people can start seeing you know
2:11a slowing of the pace we've had four
2:13consecutive 75 basis point hikes and
2:15then you get to the New Year 2023 and
2:18maybe sooner or later you know the data
2:20we just have a string of softer data
2:22like this and maybe the FED can take
2:24their foot off the pedal and say they
2:25are at that point data dependent so I
2:28don't know I mean you know it's
2:30interesting guy when you think about
2:31this where my trepidation about the
2:34broader Market in the year end was that
2:37and you've been saying that we 4 100
2:39could be easily in the cards here
2:41um you know was how poorly Mega cap Tech
2:44has acted over the last few weeks we saw
2:46a bunch of reports and guidance that
2:49sent these stocks lower all but Apple
2:51but then obviously Apple filled in its
2:53entire upwards earning Gap so it moved
2:56lower and made a new low here and so
2:58when you think about you know the NASDAQ
2:59100 or we look to look at the QQQ how
3:02close it was at its lows yesterday to
3:05the recent lows in the cycle you know
3:07there's a lot of room to run and as
3:08Market call viewers know here I've been
3:10picking at some of these stocks on these
3:12gaps lower I bought some meta I bought
3:14some Amazon I bought some PayPal I
3:16bought some uh Google
3:17um you know but these are going to be
3:18trades here because I really I don't
3:20know about you guy I don't have a ton of
3:22confidence that we're out of the woods
3:24as it relates to earnings revisions
3:26because the headline today this morning
3:28is that Amazon led by its CEO Andy Jazzy
3:32who's only been in the seat for a little
3:33more than a year is single-handedly
3:35overseeing a cost reduction pin so a lot
3:38of these companies are taking this very
3:40serious meta had that announcement about
3:41jobs cut early in the week I just don't
3:43think we're out of the woods yet no and
3:44I apologize for the talk so I'll say
3:46this so this is the problem that the
3:48Federal Reserve is going to have in my
3:49in my opinion again what you're seeing
3:52today and we'll talk about this
3:53obviously the Dollar's backing up
3:54something that you thought would happen
3:56rates are coming in something you
3:58thought would happen which in on the
3:59margin are good things the problem is
4:02the commodity Market will take its cues
4:03from that and it's going to Commodities
4:05will get back on their horse which will
4:07then Elevate inflation and we'll be
4:10right back into so you can have this
4:11cycle for a period of time I think where
4:13you get good data the market behaves
4:16like it should in other words the stock
4:17market goes higher yields go lower
4:19dollar goes lower but then Commodities
4:21get back on the horse which fuels
4:23inflation which requires them to do more
4:25money so that's where we are right now
4:27but don't you think it's an interesting
4:29guy that you know crude oil is up less
4:31than one percent today you know two days
4:33ago we detailed a bearish trade ID in
4:35The XLE and the offices Market that I
4:37put on
4:38um you know the XLE massively
4:40underperforming you know the broad
4:41Market
4:43um so you know to me when I look at this
4:44there's a chance that maybe crude
4:47doesn't get going and some of these
4:48other Commodities and maybe you'll see a
4:50rotation out of energy stocks and you
4:52know so I don't know and I also think
4:54it's interesting that you know this
4:56midterm ended up being much closer than
4:58I think anybody thought and you know I
5:00kind of came up with that little fmaga
5:02the Facebook Microsoft Apple Google and
5:04Amazon because to me for the last few
5:06years that was the stock market the
5:08direction of them you know what I mean
5:10was the key when you look at today the
5:12outperformance you look at the size of
5:14the market caps of these companies and
5:16the performance that they're having on a
5:18week again where I think a lot of Voters
5:20in this country basically said fmaga so
5:23I'm just going to tie that little bow on
5:25on that one there guys nicely done so
5:27this is what I'll say did their
5:28businesses change in the last 24 hours
5:31absolutely not and to your point are you
5:34going to see earnings revisions because
5:35the stock market's going higher today no
5:38again the problems that the Market's
5:40been facing haven't gone away this print
5:44helped assuage some of the concerns some
5:46of the inflation concerns but the
5:48Slowdown concerns are still there
5:50because quite frankly companies are
5:52telling you that things are slowing down
5:54and they're telling you that they're
5:56starting to lay people off and they're
5:58telling you that margins are being
5:59compressed so all those things are not
6:02bullish again the stock market reaction
6:04is bullish but that does not change help
6:08um in Impact anyway earnings or earnings
6:10growth from here on but but couple
6:13things here and I'd say this okay so
6:15let's just talk about some geopolitical
6:17headlines that could help earnings okay
6:19that would cause yields to go lower
6:21would cause the dollar to go lower
6:25um you know so you saw this headline
6:26that Biden's going to be meeting with
6:27President XI um in Indonesia next week
6:30okay that's potentially a really good
6:33sign for easing of sort of tensions
6:35right you saw that the Russians are
6:38pulling back from some areas in Ukraine
6:40right so maybe there's a potential for
6:43some sort of easing in that situation so
6:45you know with when you think about where
6:47we were a year ago at this time we were
6:49worried about the FED battling inflation
6:51we were worried about the Russians
6:53invading Ukraine and disrupting Supply
6:55chains we were worried about zero covet
6:57at China you know what I mean like
6:59there's the potential that we could get
7:01into 2023 and maybe the world looks kind
7:04of less dramatic attic that it had been
7:06for the better part of this year no apps
7:08listen of course this is absolutely the
7:10potential and there's potential you know
7:12for things you know why are the Russians
7:14pulling back I mean who knows what the
7:15thought process there you know they're
7:16going to try to Stage another different
7:19type of I mean I you know I can combat
7:21those arguments but you're right those
7:23things could absolutely happen and I
7:24think a lot of people are starting to
7:26get on that bandwagon you know President
7:27Biden meaning president XI is that a
7:29good thing on the margins yeah I guess
7:31is it going to change this deep root of
7:33belief that the Chinese have that they
7:35want to be a global dominant power no
7:37probably not but in the short term again
7:40it assuages some of the concerns so I
7:42think you bring up good points and the
7:43market is behaving exactly like that
7:45listen yesterday sell-off had everything
7:48to do and it will come up at some point
7:49in the show with what was happening in
7:51the crypto world I think it had nothing
7:53to do again with inflation fed and all
7:57those things that was just a one day's
7:58worth of noise so a lot of cross
8:01currents still they haven't gone away
8:02but again we've said it since October I
8:04think think what was it I think the 13th
8:0714 13 14 yeah and the 17th that you know
8:10we thought when the s p traded down to
8:1234.91 that would potential move to 4 000
8:15maybe an overshoot to 4100 was in the
8:17Cards into election and here we are so
8:19it's all sort of lining up the way we
8:21thought
8:22yes sir all right well here's one thing
8:24I have to change the way I'm lined up I
8:26have some bad lighting in myself
8:29I look like a hologram or something why
8:32don't you bring Carter into those fun
8:33movies get in here looking like you're
8:37behind your protective glass there or
8:39something just look at the zoo
8:44you're in the pope mobile or something
8:46there I love the Pokemon how are you
8:48caught it works I'm all right I'm right
8:49I'm all right how's it going no so good
8:51so you heard some of the things we were
8:53talking about and and quite frankly I
8:55think things are shaking out and sort of
8:59the way you thought they would as well I
9:00mean the back and fill in currencies the
9:03back and fill in yields the potential
9:05for the market to go up in the short
9:06term of maybe you know an oversold
9:09condition a couple weeks ago so just
9:11talk to me about today's action because
9:12everybody's all hyped up on the Mountain
9:14Dew exactly well I mean introduction if
9:17if it was 350 and we were wow s p is up
9:20seven what just happened it all just
9:22depends on how you close we know that
9:23right and so if we were to fade not
9:25going to happen like that but here's the
9:27thing you know I was just looking at
9:29this so what has really happened nothing
9:32has happened 10-year yields have gone to
9:34three eight percent I'll read this to
9:37you right here just like 10 year yield
9:38surge to 3.8 percent highest level since
9:412010. this was just in the news
9:43September 26th that is the headline high
9:47yield surge to 2.8 percent highest just
9:50in 20 years now it's we're 2.8 the same
9:54level but the listen it's a game you can
9:57Apple's earnings were no good Googles
9:59were no good Amazons were no good meta
10:02was no good and the stocks are up
10:04because the cost of 10-year money is it
10:072.8 percent and yet on September 26th
10:10the article was they're surging to 2.8
10:12percent the Market's terrible it's
10:14nothing not listening no is the bounce
10:16yeah you always get bounces but the way
10:19this ends more likely than not is lower
10:22dollar lower yields and lower stocks
10:25right and that's something you've been
10:26saying for a while so let's look at your
10:27s p chart because you have the arrows
10:29and the lines to back this entire thing
10:31up and by the way this is not you saying
10:33this in a vacuum today I mean this is
10:35what you've been saying for quite some
10:36time and it's playing out right before
10:37our very eyes you've actually said and
10:39I've said it as well on different shows
10:41that in in the knee jerk for yields
10:44going lower the equity markets will go
10:46higher until people figure out that
10:48they're you know they're going lower
10:50because things are slowing down and
10:51because you know the growth is slowing
10:54which is not a bullish thing so here we
10:55are an s p chart the lines draw
10:57themselves you have the arrows I think
11:00this suggests that there's a potential
11:02at the end of the year to trade around 4
11:06000 which by the way I mean that's
11:07something we've been saying here for a
11:09while
11:10right so I think the the hope with the
11:12very clear colors and the you see the of
11:14course the vertical line for the end of
11:15year we've got about 35 sessions left
11:17and the best case is you were to get to
11:20that downtrend line in effect since the
11:23Gen 4 high depicted in green and or we
11:27sort of continue to muddle along here
11:29but what is is important is this that
11:31right now we've simply recovered to
11:34where we were last week right so look at
11:36the price in the s p the level and it's
11:38where we were at the high last week
11:40we've just simply reversed losses from
11:43the preceding six eight ten sessions it
11:46doesn't feel to me as though it's got a
11:48lot of follow-through I think we're
11:49capped stuck we're contained by those
11:53green trend lines that you see so I'm
11:56going to make a comment before we go to
11:57yields but keep this chart up because if
11:59you look you know on the beginning of
12:00the chart in September of last year you
12:03had a series of higher highs and higher
12:05lows and we were in an uptrend it made
12:07sense and every time we traded up to
12:09that uptrend we we came off but we
12:11bounced again things changed in December
12:13where we've made a series of lower highs
12:16and lower lows and quite frankly we
12:19could trade up to or around 4 000 and
12:21that pattern is exactly the same right
12:24lower highs and subsequently probably
12:27lower lows so this is a good one just to
12:29have in the back of your mind because
12:31again in a bear Market we're seeing a
12:33bit of a rally but that happens to the
12:35point you made earlier all the time
12:37let's look at yields you brought another
12:38chart along again with lines so people
12:41can see them because I think that's very
12:42helpful
12:44uh yes I think we've got a maybe one or
12:46two iterations on yields but I mean the
12:48point about
12:49uh levels and trend lines and other
12:54reference points is that more often not
12:55they serve as a compass when you're in
12:58the dark because let's just talk about
13:0010-year yields if you ask any Economist
13:02did you know that 10 year yields were
13:04going to go to 30 base points didn't
13:05think that the worst single and this is
13:07ironic because I started in fundamentals
13:09of the when they put out payrolls that's
13:12the most observed number 40 and 50
13:14economists put in there we think
13:16payrolls will be this it is never right
13:18it's true okay what is Right more often
13:21not with its own error rate is a good
13:24chart and this is a good chart not
13:25because I drew it because look at those
13:27lines those are mathematically parallel
13:29blue lines and like a perfect sort of
13:32pinball machine when rates have hit the
13:35upper and lower band they have responded
13:37to the penny and what we're doing now of
13:39course is we're backing away from that
13:41upper band
13:42then Nathan is joined hi guys
13:45um you know I love this chart I I tend
13:47to look at some stuff I mean we've been
13:49focused on that kind of shorter term one
13:51Carter that just shows that kind of
13:52really steep uptrend from early August
13:54and the 10-year yield
13:56um went from two seven to what four two
13:58one here
13:59um and if you know this break is
14:01Meaningful and and to me you know if you
14:03look at that prior high that you have
14:05identified you know you're back at three
14:07and a half and guy and I were talking
14:09about this yesterday Carter and Market
14:10call basically saying that you know
14:12there's a world where three and a half
14:14three and a quarter in the 10-year yield
14:16is a really healthy thing I mean think
14:18back to 2018 guy when you know Fed chair
14:21Powell was Raising interest rates a
14:23quarter point every meeting and they got
14:25to about three and a quarter or almost a
14:27three percent in fed funds but the
14:2810-year was three and a quarter I mean
14:30without that Global growth fear you know
14:33that that might have been the path to
14:35normalizing rates in a way so I think we
14:38can all agree that nobody wants to see
14:40raids crash to your point Point guys if
14:42we saw the 10-year yield come down it
14:44would be reflective of growth it'd be
14:46reflective of flight to Quality there's
14:48a level that makes perfect sense
14:50especially if inflation's coming down
14:52here so to me I still like this this
14:55move lower in yields at least to three
14:57and a half percent by the end of the
14:59year and and maybe three percent we're
15:01gonna try something on the Fly here
15:02Mickey rat asks and Jacob if you can put
15:05up an XLV chart
15:07um what can we can we discuss the health
15:09care stock so the XLV I think I'm nine
15:11percent nine and a half percent of the
15:13XLV is Johnson and Johnson but then you
15:15have Lily Pfizer Abby those types of
15:18names but this has been a monster Carter
15:20and this is something you've talked
15:21about for a while you know we're
15:23probably at levels that we should fade
15:25here August September we traded up to
15:27these levels maybe we've over extended
15:29you know that double bottom is well
15:32intact but what are your thoughts here
15:33in the healthcare because if things are
15:35going to rotate into sort of higher
15:37valuation names Healthcare probably take
15:39a breather
15:40right so in and of itself just looking
15:43at that chart and you didn't know it was
15:44XLV was just a white background with
15:46black bars you'd say
15:49um bearish not particularly bullish not
15:51particularly you'd say that's what a
15:52pair of twos is it has no character but
15:55what is important is the relative
15:56strength exhibited by Health Care to the
15:59market and I continue to like healthcare
16:02as an overweight as do I Home Depot you
16:05brought with us because it's the move
16:06today again some of these individual
16:08stocks we could probably rattle off 50
16:10but Home Depot's one today where it
16:13looks like we're through that downtrend
16:15line and who knows what it means maybe
16:16it means we trade up the highs we made I
16:18don't know mid-summer late summer
16:20right so obviously a gap as is the case
16:23with almost all stocks today news
16:24related having to do with uh government
16:26data but the point here is two one it
16:30doesn't breach it's June low Market does
16:32it doesn't that's what relative strength
16:34is too it is now moved above that
16:37downtrend line now the downtrend doesn't
16:39have that much Authority all I've done
16:40is connect two points and today we've
16:42moved above and made it a third point
16:43but if you were to use a 150 moving
16:46average what you'll see if we might have
16:48this is that it's also starting to
16:50flatten and if we don't that's fine too
16:52no we have it this looks like to my
16:54right it has all the Care okay and so
16:57the moving average flattening typically
17:00happens at the same time when you move
17:01through the downtrend so if you do the
17:04downtrend line in red here they are
17:05together basically this is uh all that
17:09one would hope for for what should be
17:11the beginning of an important bearish to
17:14bullish reversal yeah here's one carton
17:16I know you're looking at Home Depot
17:17today not just because of the charts but
17:19again you know this was a knee-jerk also
17:21to the move in rates and and when you
17:23think about a group that's moving um
17:26today look at home builders I'm looking
17:27at Toll Brothers up 11 Lennar let's take
17:30a look at Lennar up 13 I see this thing
17:34you know breaking out above its 200-day
17:36obviously the 150 day would be
17:39um not far off of that this looks like a
17:41really constructive chart it just made a
17:44new like six month high today it's
17:45pulled back a little bit is this the
17:47sort of continuation move that you'd
17:49like here and again I've heard you say
17:51on numerous times over the last few
17:53weeks when you've looked at some charts
17:55that look bullish to you the whole idea
17:58that in this last down draft they did
18:00not make new lows this has to figure
18:02into that thinking too right so it it
18:05has almost all Aggregates and indices
18:08and asset class have their June low so
18:10did crypto Bitcoin and then most things
18:12went back and Revisited those lows some
18:15made new lows some didn't but this
18:16didn't and and the housing in general
18:18has not and so this is very similar to
18:22Home Depot
18:24um I'd want to be on the long side not
18:26the short side
18:27so I've got a dollar chart Carter
18:29because you know Dan said he's been
18:31sticking with this and it's proven to be
18:33correct you've made comments about this
18:35you drew that by the way that Arrow was
18:38drawn I know we saw this chart a couple
18:40weeks ago and you suggested it's
18:41probably going to exhaust itself the
18:42same conversation we had back in June
18:44that we said we're in an uptrend but the
18:47dollar will exhaust itself will probably
18:49trade to the lower end of the channel
18:50and then bounce that's exactly what
18:52happened we traded up to the top end of
18:54that channel as well and we've come off
18:56difference here though maybe is that now
18:59we're breaking through a channel
19:00thoughts here in the US dollar right so
19:02we put out a note to clients actually uh
19:04on Monday saying that we're going to
19:06approach the lower band but not hold we
19:09think it will break through and that is
19:12because it's the equal and opposite
19:14notice how we slightly broke through to
19:16the upside
19:17um where that last Arrow was drawn when
19:20the first judge was made you're likely
19:21just as you overshot there you're likely
19:23to undershoot and so that undershoot is
19:26underway the only ref reference point
19:28that matters now and I think we have it
19:29on here is the 150 moving average and so
19:32there they are together and I think we
19:34have it with just 150 to make it very
19:36clean and that's where I will be
19:39flipping around the dollar short trade
19:42and at least covering the short and then
19:44making the decision to either play for a
19:46bounce or not yeah if these guys can
19:48pull up the uup the ETF that tracks the
19:51the US dollar Index and again we've
19:52talked about this a lot fifty percent of
19:54the weight of that ETF is the Euro we
19:56know how the Euro has been so weak and
19:58again I do think it's interesting to
19:59have the Break
20:00um of this trend you know if you look at
20:03this thing I mean I'm really I I guess
20:05from the get-go I've been saying I've
20:06been playing for a move back to 28 I
20:08think that gets you know below that
20:10uptrend but but really kind of um you
20:12know does the job it gets back to a
20:14breakout level so in my mind that's
20:16where um I'd be taking
20:18um that bearish trade-off in the uup
20:20guys I got to give you guys both props
20:23here
20:24um Carter you had a note I think earlier
20:26this week or maybe late last week on
20:28gold miners guy you've been talking
20:30about I think you said it on Market call
20:32there's ever a time for gold to hold and
20:36you're looking at the GLD
20:37um it's right here are you guys a little
20:40bit surprised by today's uh continuation
20:43you know given what we're seeing now I
20:46get it it maybe it's just dollar related
20:48here but it seems like is there a need
20:50to run out and buy gold it's forget the
20:52chart you understand what I'm saying
20:54given what we're seeing across you know
20:56risk asset markets right here
20:59uh guy why don't you go first and then
21:01is there a need to buy it no because
21:03every time you've done it on moves like
21:04this you've been you have not been
21:06rewarded but I will say this this I know
21:09to be factual central banks continue to
21:11be net buyers of gold it makes sense
21:15that gold is rallying here one
21:17technically off that really little
21:18short-term double bottom that we flagged
21:20and B Because if you think about rates
21:23coming down the headwind of a stronger
21:25dollar seems to be abating and again
21:28inflation's a problem but if the FED
21:29were to back away it opens the door for
21:32gold to go higher so and coupled with
21:34that the fact that crypto seemingly is
21:36blowing up before our very eyes you add
21:38all those things into the mix and it
21:40comes out for a pretty bullish equation
21:42for gold so I don't think you're going
21:44to miss it to the upside down but I
21:46think you definitely want to stay with
21:48it Carter
21:49right so it's it's ever thus with the
21:52with the circumstance of who one is in
21:54the market and what your time frames are
21:55so just looking at this
21:58um here's a here's a chart with some
21:59nice lines I I did draw them but uh
22:02forget the fact that I drew them they're
22:04they're kind of tell the story is that a
22:06downtrend it has multiple touches yes
22:08have we broken above the downtrend yes
22:10is it the setup of a triple bottom which
22:12is to say it was not making new lows but
22:16here's the issue and this is its Ultra
22:18time frame is do we Chase something with
22:21new money right now we'll take a look at
22:23the next chart we're getting awful close
22:25to 100. it's the reciprocal of the
22:27dollar the Dollar's getting close to 100
22:28average having sold off meaning this is
22:32very encouraging ultimate I think gold
22:34because I think they're going to start
22:35doing QE 990. I think that's what this
22:39is saying of course because we are going
22:40to go into recession but independent of
22:42that it's a tough Chase here and so this
22:45is in a perfect rower to speak to
22:48derivatives I would stay long and sell
22:50calls yeah hey guy you know so that's a
22:53really important Point here you've been
22:55saying that you know if you saw a backup
22:56in yields especially in the 10-year that
22:58would suggest that economic activity is
23:01weakening here and would you take the
23:02the same thought away is that Carter
23:04just did is that a continuation in the
23:06moving gold is greater confidence that
23:08the FED is going to go from the
23:10aggressive tightening to possibly
23:12aggressive loose monetary policy to kind
23:15of be more accommodative I guess if we
23:18do have a weaker economy well I mean I
23:20think Danny Moses thinks that's going to
23:21happen as well and there are a lot of
23:23people that were talking about that in
23:25the spring of this year the potential
23:27for it to happen in the spring of next
23:29year I hope they don't do it um because
23:32just the problems that we are trying to
23:34combat now we'll just come back in
23:35spades but what'll what'll happen if
23:38they do well that dollar that's now
23:40challenging that 150-day moving average
23:42will break through it to the downside
23:44and gold which is challenging the 150 on
23:46the upside will break through and all
23:48those things will come back in spades by
23:51the way you mentioned a perfect world
23:52Dan I know you don't want me to do this
23:53but great Kevin Costner movie oh yeah
23:57Clint Eastwood and the guy from
23:59um the the president movie remember that
24:01The West Wing the guy Whitmore Whitmore
24:04oh yeah Bradley Whitmore that guy I'm
24:07gonna tell you he's a political Beast I
24:10don't know if you're watching the
24:10handmaid's tale but he's like a tour de
24:13force in that in that show that that's
24:15what is he in that one yeah he's the
24:17he's the guy he's uh Lawrence he's the
24:19oh Lawrence he's kind of once once yeah
24:21with the scarf and all yeah no he's just
24:23a great character
24:24um a guy I'm happy that you did that I
24:26remember Laura derns in that movie too
24:28but that's that's Bruce Dern's daughter
24:30and she's in all the Jurassic Park
24:32movies anyway I I apologize she is she
24:34isn't that the Bitcoin that's the
24:36stokeberry the lead Dan this is this is
24:39your this is your Bally Wick you say
24:41that it's so funny because you know I
24:44think there's like Wars going on on
24:47Twitter about the Bitcoin here because
24:49all of these guys who had all the
24:51podcasts and the laser eyes and the 200
24:54000 price targets and all that stuff
24:57um they're not there anymore I don't see
24:59them tweeting about it I don't I think
25:01they shut down their podcast everything
25:02like that and you know I've always just
25:04found Bitcoin or crypto in general
25:06interesting because some of the smartest
25:09people that I know in Tech and finance
25:10find blockchain technology really
25:12interesting
25:14um and you know again I've never I've
25:16been really skeptical of guys like Jack
25:18Dorsey who have like this religious
25:20belief in something like Bitcoin so I
25:23haven't owned Bitcoin in years to be
25:25honest with you it's not something of
25:26interest to me so when you say it's my
25:28baliwick I find it interesting from an
25:30intellectual standpoint but look at this
25:32and Carter I drew these lines I'm just
25:34curious what you think again this is not
25:36a log chart we're going back to that
25:38last retail high in 2017 when that was
25:42just a frenzy that retail frenzy right
25:44and here we are you know and you made
25:46this point I think on fast money that or
25:48night you know everybody he thought this
25:50kind of 19 to 20 000 range was support
25:52until there was another evident scenario
25:56of a Ponzi scheme and look what happens
25:58it drops 25 percent in a straight line I
26:01guess I don't know how this doesn't go
26:03back and go to that kind of ten thousand
26:06dollar level where it took off from in
26:07late 2020 Carter thoughts on that yeah
26:10where we are now interesting is having
26:11undercut the June low we've thrown back
26:13to it right so we've had a big Ricochet
26:15over the last two sessions and we're
26:17right back to the breakdown level which
26:19is what the definition of overhead
26:21Supply is so how far down and go it can
26:25go as low as the imagination will allow
26:26the main thing of all things I think is
26:29that more money has been lost in Bitcoin
26:31than made right because there weren't
26:32there weren't as many people involved on
26:35the way up whereas the involvement the
26:37amount of capital since the peak has
26:39been tremendous and that's uh basically
26:41puts you in a hell of a situation Dan
26:43yeah well guy one thing I wanted to
26:46throw this chart Bitcoin
26:49software I mean yeah they look at this
26:51hand in hand apparently both of them
26:53topped out to the to the day you know 52
26:5652 uh weeks ago yesterday I guess and
26:59when you think about this is that you
27:01know software not that these things you
27:03know I think some investors were
27:04thinking of them in a similar capacity
27:07the way they thought about risk and and
27:08you know they were obviously well
27:10correlated but that looks like that's
27:12been diverging a little bit and I'm just
27:14curious thoughts there guy because would
27:16you rather buy crypto here or would you
27:18rather buy a bunch of software companies
27:20that have big market caps big valuations
27:23traded ten times sales
27:25so here you go I'm going to answer that
27:27I'm gonna I'm gonna do the answer you
27:28don't see coming I would submit that
27:31what's going on in the crypto world now
27:33is the market basically regulating
27:35itself and it's weeding out some of the
27:37Bad actors which in the long run is
27:40probably a positive thing so this
27:42actually might be one of those
27:43inflection points in Bitcoin so given
27:47the choice in the Would You Rather game
27:48believe it or not I can't even believe
27:50I'm about to say this Bitcoin wow that's
27:53that's pretty fast you know so I know
27:55you didn't see that one right Carter
27:57play the game buddy would you rather
27:59Bitcoin
28:01as a long I'd rather have igv for sure
28:04yeah all right well we we put we we did
28:08that we played that there was a guy
28:09named um remember this guy Pavlov is was
28:13his name yeah I like names like that
28:14sounds like a hockey player and he had a
28:16dog right and I guess what he would do
28:18is you know he'd ring a bell and then
28:19he'd give the dog whatever and got to
28:21the point where every time the belt the
28:22dog would salivate it's Pavlov's dog I
28:24mean it's it's legendary that's what's
28:27happened here on Market calls on
28:29Thursday all I got to do is say one
28:32freaking word and this entire comment
28:34section I mean I just I can just feel it
28:36lighting up it blows up all right you
28:39want me to say it or you want Carter to
28:41say it I'll say it if you want
28:43somebody who wants to say it please
28:45stand it all right but but here's the
28:47thing guy you know factset are fine
28:48sponsor they like to clip this segment
28:51so we just had a little fun live on that
28:53let's do it properly okay so here's the
28:56clippable part we can't get we can't
28:58finish up a Thursday without going to
29:01the great John Butters and the
29:03tremendous work that he does and Dan
29:05once again we are going to highlight his
29:08Thursday notes so slide it Earl all
29:11right well you know the name it is John
29:12Butters he is the senior earnings um
29:16analyst over there at factset and he
29:18writes his earnings Insight blog that
29:20drops every Friday morning but he gives
29:22us a little bit of a sneak peek on
29:24Thursday's Market call and actually Guy
29:27special announcement John Butters is
29:30going to be on Market call with us not
29:32just his note this is going to be next
29:34Thursday people so tune in if you want
29:37to see the man the myth and the legend
29:39but I find John's work really
29:41interesting because you know over the
29:43the course of each quarter as we're
29:45thinking about what the results are
29:47going to be he's always given us little
29:48tidbits on Thursday but I always find
29:50the postmortems really interesting too
29:52because sometimes we get so caught up in
29:54some of the individual names as they're
29:56reporting it's kind of hard to see the
29:58forest from the trees if you will but
30:01John in his earnings inside blog this
30:03week is talking about how investors have
30:06been rewarding positive EPS surprises
30:09and again you know we've spent a lot of
30:10time on Market call focusing on some of
30:13the big disasters that we've seen over
30:15the last couple of weeks whether it was
30:16Microsoft or Google or meta um and uh
30:21you know and Amazon all had 10 percent
30:23gaps or so but what his work is saying
30:25is that investors are kind of leaning
30:28into to companies when they're beating
30:30now he's also done a lot of work on how
30:32the uh average
30:34um you know estimate has come down over
30:35the course of the quarter so thoughts
30:37here a little bit guy on we know that
30:39estimates have been coming down and the
30:41companies that are beating lower nest
30:43events they're seeing their stocks pop
30:44at a greater rate than we have in the
30:46past you know but and so here's yes all
30:49those things are great and then this is
30:50my takeaway the market is also punishing
30:52negative EPS surprises more than the
30:54average third quarter which you know
30:56what in this environment those companies
30:58should be punished and what the further
31:00takeaway is and a zero interest rate
31:02environment nobody got punished ever and
31:05that led to complacency and laziness now
31:07as rates go higher you know today
31:09notwithstanding Carter loves that word
31:12companies are getting punished if they
31:14don't perform and that's the way the
31:16market should operate so everything that
31:18he put in this note makes perfect sense
31:20and it speaks to for the first time in a
31:22while an efficient market Dan
31:25yeah Carter thoughts on that because I
31:27know yeah so we I think that and we'd
31:29have to couple this with obviously the
31:31other work done by Butters which is or
31:33the revision analysts look earnings
31:36estimates going back to the 1970s
31:38typically revised one percent a month
31:40down because that's why they call it the
31:42sell side they're there to sell and so
31:44they put these price targets that are
31:46not realistic and then slowly over the
31:47course of the year they move them lower
31:49when you're in a down tape in a market
31:51such as this where you drop 20 to 40
31:54depending on the stock and let's start
31:56revising more aggressively down and then
31:58of course the Beats come in because
32:01you're beating numbers there are
32:03estimates that were really revised maybe
32:05too much so the real question is what is
32:08the beat rate of the pre-revised numbers
32:11and I don't suspect it's all that good
32:12all right well listen to John Butters
32:16check out his blog post is going to drop
32:18tomorrow on factset's website I got one
32:21question okay this is going to be a
32:22little bit of a curveball for you guys
32:24Rangers Red Wings tonight yeah the
32:26Rangers are in Detroit the fathers are
32:28there Rangers haven't been no no next
32:32week okay on the 17th Alibaba is
32:35reporting okay let's see if we can throw
32:37a chart up here okay stop trading down
32:40to 58 on the 21st of October I think it
32:42closed that day at 62 and change it
32:44traded over 100 million shares since
32:46October 31st of 2020 we have seen seven
32:50or eight 35 to 50 percent bounces from
32:53Merlot I think we saw a similar one on
32:56the 21st I think the stock has potential
32:58to trade 90. so here's the thing so next
33:02week we already talked about Biden's
33:04meeting President XI okay who knows what
33:07the hell is going to come out of that
33:08okay so you look at a stock like this to
33:10me this is kind of the poster child for
33:12Chinese equities at least from an
33:14American Investor's perspective you know
33:16I'm looking at the implied move in the
33:18options market so the next week okay
33:20with the stock just below 70 the next
33:23week 70 straddle all is uh would cost
33:26you that's the put premium and the call
33:28Premium but together it costs you about
33:30seven bucks seven bucks on Seventy ten
33:33percent provide that that gets you about
33:35ten percent implied moving either
33:36direction now if you thought the stock
33:38was going to 90 you could buy the next
33:42week 70 call okay you would only have a
33:44day or so after earnings to earn that
33:46out so you wouldn't want to do that but
33:47you could pay about three percent okay
33:49which about 50 you know five percent
33:51it's about fifty percent of the size of
33:54that strength uh that straddle what does
33:56that look like to you Carter when you
33:57look at that chart you look at a 10
33:59implied move if you wanted to Define
34:01your risk and you thought there was a
34:02couple catalysts one being earnings does
34:05this look like an interesting setup to
34:06you uh I'm I'm a buyer I I'm with God
34:09I'm not sure 90 that's a big jump but uh
34:12higher I think it's worth it's worth the
34:14stretch as they say it's worth the risk
34:16I bet long all right so we're going to
34:18check that one worth the lemon or what
34:21is this what is it worth something we'll
34:22check worth charting we'll check that
34:24out next week There's a slighter
34:26earnings we'll do a little we'll do a
34:28little maybe we'll do it just squeeze I
34:30don't know I hear these dumb sayings of
34:32people I think people say dumb things
34:34every once in a while just to sound
34:35smart you remember that movie and they
34:37were deciding whether they go in for
34:38that last big deal he said it's worth
34:39the stretch we I need the money I like
34:41that I love can I say something I I will
34:44I will say this and I know I gotta get
34:46out of here because I got to go to do
34:47our podcast but we were on the three of
34:49us we're on the desk the other night
34:50with with cnbc's Melissa Lee that was
34:52f-u-n fun fun fun
34:55right Dan I danced it was I I mean I I
34:58think with I think at this point on
35:00Thursday Carter guy and I've spent way
35:03too much time together yeah it's like a
35:05date you know it needs a little break
35:06and we have two more things to do we
35:08have our podcast with Danny Moses and
35:10we're gonna do this afternoon and then
35:11we have fast money and then we're out
35:13then we're number five yeah we may not
35:15talk for three days well that's not true
35:16yeah that's it for Market call Rangers
35:19Red Wings tonight the Rangers really got
35:21to get their sleep together I think they
35:23do it tonight in the Motor City want to
35:25thank our sponsors factset and so far if
35:28you like Today's Show like it and leave
35:30a comment on the video don't forget to
35:32subscribe to risk reversal media on the
35:35YouTube we will be back on Monday 1 p.m
35:38eastern time there's a lot of moving
35:39parts next week so pay attention it's
35:42the cheapest thing you can do later
35:44[Music]
35:47[Applause]
35:55all right
35:56[Applause]

About this transcript

This page contains the full transcript of Stocks Surge on Soft Inflation Data by RiskReversal Media, generated from the public captions YouTube serves with the video. The transcript has 7,423 words across 1,006 segments, with the original timestamps preserved so you can click any line to jump to that moment in the embedded player.

What you can do with it

Use the transcript to take notes, quote the speaker, build a study guide, generate a summary with ChatGPT or Claude via the YouTube Summary tool, or export it as a timed subtitle file with YouTube to SRT. You can also re-open it in the transcriber to choose a caption track available on the video.

Free YouTube transcript tool

YouTube2Text is a free YouTube transcript generator — no signup, no daily limit. Paste any YouTube link and get the full transcript instantly, with timestamps, click-to-jump, caption language selection, AI prompts for ChatGPT, Claude, and Gemini, and exports to TXT, SRT, VTT, or Markdown.