Investor's Edge with Gary Kaltbaum - CENTRAL BANK DAY

Episode Date: June 15, 2022

More Info At: http://garykaltbaum.comMore

At CVS, it matters that we're not just in your community, but that we're part of it. It matters that we're here for you when you need us, day or night, and we want everyone to feel welcomed and rewarded. It matters that CVS is here to fill your prescriptions and here to fill your craving for a tasty and, yeah, healthy snack. At CBS, we're proud to serve your community because we believe where you get your medicine matters. So visit us at cvs.com or just come by store. We can't wait to meet you. Store hours vary by location. Investors Edge with Gary Coltbaum. Straight talk about you and your money. Now from the BizTalk Studios, here is Gary Coltbaum. And welcome once again to Investors Edge. I'm Gary Coltbaum,

your host day. Thanks for being with us today. Glad you here, ladies and gentlemen, happy that you're listening. It is June 15th, 2020. It is Wednesday. Hope you having a great day. Let me phrase this the best way I can. And we start at the outset. The information that is being put out there on the things that happened today is so wrong, I can't even begin to tell you. And I know that people do the best they can. I don't think anyone has bad intentions. But man, oh man, just a load of crap out there

with the many just not doing their homework. Not working hard at this. Not putting in the time. So let me explain. Jay Powell made a decision, Christmas of 2018. He chose to be the champion of the stock market and Wall Street, while screwing savers. He is the most powerful man on this earth that a lot of people have never heard of.

If you walk the street with a microphone and asked who's Jay Powell, not an indictment of people, but I'd say eight out of ten wouldn't know who he was. He is much more important than Joe Biden. He is much more important than any president that would have been in the White House right now. And in Christmas of 2018, he made the decision to screw savers. Of course, he didn't see it that way, but he did, and lift the market up. what he did was at the time he was doing the right thing. The economy was strong.

Employment was very low. Unemployment was very low. Yet he decided to stop raising rates and decided to lower interest rates into a very strong economy at the time, though a lot of it was a mirage, because, as we told you, massive deficit spending looks good. But I digress.

Throughout 2019, he kept lowering rates every time the market dropped. Every time. And the reason why he lowered rates, he stopped raising rates at Christmas was because the market was cracking very, very badly. A normal bare market for stocks. Bare markets are a normal occurrence. and if you just leave them alone and let them go through their bare market, they usually end in eight, nine months, and we get going again.

But he decided to play God. So, all through 19, lowering rates, markets drifted up every time, and then would drop. And then in October, he announced his money. printing. Now the last time we had money printing was Ben Bernanke, but that was in the depths of hell, of a financial crisis that Ben Bernanke was part of the cause. And it was that October, I said to you on radio, and I'm very careful with my words, buy the hell out of the market. because we know by just precedent money printing induces froth speculation, greed, asset bubbles. And the market went whoop to the upside.

But then COVID hit in February. And it didn't matter what J. Powell was doing. The market took a big hit. and leave no doubt a central bank is not just going to sit there when COVID hits and we're shutting down so he takes rates down to zero percent immediately don't worry and Aunt Mary Uncle Bob on their money he took him down to zero and then he started the money printing machine he started with a number That we're going to do this. And what they do with the money printing, beats the hell out of me, is they start buying up assets.

What assets? Junk bonds, corporate bonds, treasuries. Why to take them down, the yields down as low as possible? Because he believes, oh, that's going to spur on or save the economy and save the credit markets and all that. But the markets did not respond to his first announcement. So we announced a second tranche. That's the word they use. And the markets did not respond.

And then he announced a monster trunch. And we got going. Markets started lifting and started lifting. And then of course, after a while, things got better. We ended up with a vaccine. God bless those companies and we slowly started to open up some places more than others. For example, Disneyland in California, I believe,

opened up 10 to 12 months later than Disney World. Each state made decisions based on who was running the joint, but we knew there was going to be a problem. How did we know? because money printing induces greed, froth, speculation, and potentially big bubbles. But this was not just any money printing. We use the term gargantuan, massive, and told you to expect all kinds of crazy. J. Powell did not know what he wrought.

notice the big word I love using words that I never use and we got bubbles up the wazoo market sword weird crap started to happen meme stocks game stop do you know

that it still amazes me to look back on it it still amazes me to tell you that a game stop went from 17 to 483 in days. In days. AMC movies went from $2 to $20 in a day.

Carver Bank Corps went from 10 to 42 in a day. We're not making this up. But of course, as we've always told you and begged you, pleaded with you, go get the book, extraordinary popular delusions in the manness of crowds that they would all bust because they always do and unfortunately Jay Powell

did not have any clue of this none head in the stand buried deep so we just have walked you through what he wrought massive bubbles that always

top and bubbles always top badly. And due to the fact that this is the biggest one we have seen bigger than 99, that we thought all hell was going to break loose in many areas. And we even told you which ones, because they were the ones that went nuts. So marijuana stocks, Tilray went from 7 to 67 in weeks. We'll come back. We're giving you a story here and we'll bring it to today. And we're going to have some big important lessons for you.

That's up next on Investor's Edge. Hi, I'm Gary Kalbaum, hosted a nationally syndicated radio show Investors Edge. We're not just handsome radio people. We manage investors' money for a living, specializing in fee-based discretionary money management. No big commissions, just a fee on the assets that's managed. We also provide a full range of personalized services, including retirement planning, fixed income,

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Investment advisory services offered through Colbomb Capital Management. If you've been following the news, you know the world is dealing with a level of uncertainty that isn't going away anytime soon. Inflation pressures, global tensions, and the highest U.S. debt levels on record continue to influence markets day after day. And the result is familiar to anyone checking their retirement balances or savings accounts. Volatility has become the norm. In times like these, people often look for ways to strengthen their financial foundation. Physical gold and silver have served that purpose throughout history. They're real assets that exist outside the digital and financial systems that tend to fluctuate during economic stress.

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Next time, I'm going to say, not if you're driving a Toyota truck. We know what we're made of, Toyota Trucks. It's time to switch on the integrator units and get to. The brain cells working. You're listening to. Hey, this promise is to be fun. Investors Edge. The last bastion of quality programming.

With Gary Coltbaum. It doesn't get better than this. Okay. So the bubble started popping. And your buddy, me, the best technician on Earth, and we've proved it again and again, and nobody knows us and we hope to keep it that way. Stay under the radar. A little, a few more people know.

of us now, little by little piece by pinch, inch by inch, stock by stock, sector by sector. We started calling tops as they happen. And because we know by precedent that when 30 stocks in a group top at once, it is of more import, when 50 growth names, high beta growth names within a week start topping badly on big, big volume, it's of import. So as it started happening, we started yapping at you and yelling at you and screaming at you about, these are tops. And we'd always use the same terminology. We're not going to tell you what to do. You decide.

We're just letting you know what's going on. And then came October and November. And I remember the day it was November 22nd. that day, I'm going to take that back. It was November 19th the Friday. November 19th, the NASDAQ hit a relative all-time high as well as the NASDAQ 100. On that same closing day, there were more than 500 new yearly lows on the NASDAQ.

While it was at all-time highs, indicating exactly what we've studied about tops and markets. Massive divergences where the average stock is getting clonked, but the indices hold up because underneath the surface, the big money that we tell you about that have these meetings in the mornings with their portfolio managers are selling the higher risk stuff and parking that money into Apple, Microsoft, Google. At the time, Facebook was still down 10%,

but hanging in there. And why does that occur? Because if they're a technology fund, they got own tech. So we move from things like a Shopify. They just get the Apple. And Apple ended up doing well for the next so-and-so amount of time while the market underneath is getting croaked. and we're just highlighting for you in November,

we would come on the show and say, oh, this one top, that one top, this one top, that one top, this one top, that one top, this one top, that one top, that one top, we were just listing them for you. So the big high beta growth area bubble popped. And when we use the term bubble, technology stocks since 2009, the low, up 14-fold in less than 13 years. That's a bubble.

So as we say little by little piece by piece by inch, that started happening. But also we started warning you about inflation. Why? Because throughout all that time, all we were hearing from Jay Powell, while inflation was heating up, it's transitory. It's transitory, don't worry. and then in December oil prices started running but it's transitory

don't worry and while all this is going on his job at that time should have been halt stop the money printing start doing something different but no

and what that does it keeps sowing the seeds and we warned you little old me I don't have the stats that Jay Powell has, so then it worsened. And then you got the cherry on the top. Russia attacked Ukraine. And politically, the pundits are out there not mentioning that on one side, mentioning it on the other side.

But the fact is, that helped inflation along, no doubt. We have no bias or agenda here. We hate all them. We hate both sides. So we tell you the truth at all times. But Biden, hear no evil, see no evil, speak no evil. Got to keep the greenies happy.

Screw you. We're not drilling anymore. Up yours. Screw you, oil companies. Jay Powell. Oops. Yeah, maybe it's not so transitory. Oh, and maybe we have to change our stance a little bit.

Oh, maybe this, maybe that. And of course, you know what's happened since. all the bubbles have popped markets have cracked inflation has skyrocketed on so many fronts but don't worry it will start coming down

and then Jay Powell finally had a stop and he did late but he stopped printing and then started raising interest rates but slowly but something happened that Jay Powell lost control of because he was no longer printing money,

the real market came into effect. Remember what we told you? He played God with markets, and it worked. Nine trillion bucks will buy a lot of crap. But once you stop printing, the real world shows up. And you know what the real world is? Interest rates definitively having to account for higher inflation. It's called the norm.

So interest rates started going up because he stopped interfering. Now I take that back. He was forced to stop interfering. And they kept going up. So we had a raise again. And they kept going up. So we had a raise again. But still was way left behind coming into the beginning.

Let's talk two weeks ago. two weeks ago. Let's make it two and a half weeks ago. May 27th. That was a Friday. The Monday was a holiday. And at that point in time, the thought process was,

we'll raise a quarter point, maybe a half point, and play a little bit of catch-up. And that's all he's doing. Played catch-up. To what? The real world. The real markets that he,

controlled with unimaginable amounts of conjured up money, with no accountability or oversight by anyone because he's the most powerful man in the world. Now remember that date, because it's important. May 27th. Up next, we'll take you to today and our thoughts. Thanks for being here. This is the one-only investor's edge.

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America is talking Investors Edge He's got to be pleased with that The crowd is just on his feet here He's a Cinderella boy With Gary Colbomb Comes highly recommended You're gonna feel better if you talk to him

So Donna do Boston By the way I did tell you that I'm headed next week Across the Pond for Wimbledon But I'm going a little bit early

because on a Saturday is the Rolling Stones in Hyde Park and Sunday is the Eagles. So I decided to go early. Now, I heard Mick Jaggers got COVID. He had to cancel in Amsterdam deal hoping he's better. I'm all better. So I'm out of here. Just so you know, we'll be doing the show from across the pond. We will have our little iPhone and Lucy Live app that we just talk into and do a radio show.

Modern technology baby. And I believe it's, hmm, 10 p.m. when the market closes there. Am I correct in saying that right now? Let me real quickly look that up. How about this? London time. Oh, it's 9.25 now. It's five hours.

So at 9 p.m. 425, yeah. It's six hours in Paris. Yeah, I think it's six hours in Paris. Yeah, so it changes a little bit. Anyway, so we'll be doing that. So let's talk, May 27th. From May 27th, that close.

Now, understand this. The 10-year yield, these are 10-year yield. You can invest in them and get a yield. If you hold for the 10 years, you get your yield, you get your money out. It was paying 2.7%. by yesterday, 11 trading days, yields closed yesterday at 3.483 from 2.7. That may sound like, oh, it's a gargantuan move. And that move scared the crap out of Jay Powell, and that's why he went three quarters of a point.

Whoa, what's going on here? What's the market telling us? So last week we went on TV before anyone else and said, oh, we're getting three quarters a point. Not because of anything I knew. It's because of the market, the real world. And Jay Powell over the week, excuse me, on Monday, sent a memo to his friends in the media, three quarters a point to be prepared. And of course, that move crushed the market. The stock market, of course it's going to.

So we got to almost 3.5% before today, Jay. PayPal was sitting at three quarters of a percent. And in case you don't know, let me explain. At a minimum, a central bank needs to be in line, but really higher, than the 10-year yield. That is the reason why markets have been getting crushed. That's the reason why the bond market's being crushed. Because no credibility. We don't trust this ass clown. Nothing. personal. So we went three quarters of a point. Only one problem. He's at one and a half percent. He's supposed to be an inflation fighter. The one year yield is almost three percent that came down a little today. He's still way behind and has to be in prayer mode.

because he is now dependent on because he's not printing anymore and buying up yields to come down. That yields come down by themselves. And the good news is it did today. The yield on the 10 year came down today and I believe finished at 3291. It's a huge drop from 3, 4,995. But the reason why yields drop today is because they went vertical over 11 days. So that's on the normal side to pull back. Remember what we tell you about bull markets, ebb and flow.

Go up two, come down one. Go up, two, come down one. You know what, though? Bond yields went up like 10. So maybe they come down five, but remain in bull mode. And of course, since the Dow dropped 3,000 points in four and a half days, that's going to bounce if yields come down. And that's what stocks did today, though quite the disappointment at the close. And I'll explain in the minute, not knowing what tomorrow brings.

We now have six weeks until the next Fed meeting. So we're going to conclude this part of the show with me stating to you the most important part of the equation. First and foremost, don't listen to anybody else. The misinformation out there today was nightmarish. For the next six weeks, these central bankers are not going to shut their mouths. Unfortunately, they're going to be yapping because they're a bunch of egomaniacs. I don't want you to pay any attention to them. All I want you to pay attention to is the yield curve.

That is, go Google every day, the one year, the two year, the five year, the ten year, and the 30 year. If they keep coming down, it takes the pressure off. If they keep going up, it adds pressure on. it would be normal now just because to pull back a little more it would be normal to pull back more yields

I will let you know if I think they've really topped but right now it's just a normal pullback and I worry that people will take that for oh better when it's still a bull market in yields. So watch them. If yields pull back, but only moderately, and then start

rising again and head towards 4% on the 10 year, forget about it. Let me repeat. Pay no attention to what they say. You got six weeks before they make a move unless by chance they do an emergency move in between, which does not happen very often. Just watch the yields. It will dictate a lot of policy. Right now it remains in a Super Bowl market yields, bond market and a bear market. And we'll be watching closely. Now, of course, with that move down in yields and of course, with the 3,000 point drop in the Dow to yesterday's lows, in four and a half days, you You will get a counter-trend move. So the market wrap is brought to you by Investment-Dashmodels.com.

That's Jim Rohrabak, one of the great market timers. No gray areas with the man you're either in or out of the market with his proprietary indicators. Go check it out. Investment-mottles.com. The Dow was up 303 points today, but was up about 660, even though yields kept going down. That weirds me out a little bit. which takes me to a little segue, if the market starts thinking,

well, we're going into a good recession, all bets are off. The S&P finished up 54 today, but was up, wow, 102, cut in half. Yeah, about right. The NASDAQ finished up 270 today,

but the NASDAQ did hit up 415. So it was a good day, but man, could have been a lot better. The Sox, the semiconductor index, was up 47, but was up 90 at one time. And all of it was into the close, basically, on the comeback. I can tell you, at 335 we hit the high for the day. Tomorrow's another day. Up next, we think we explained that pretty well. We'll have more.

This is the one only investors' edge. Struggling to see up close, make it visible with Viz. Viz is a once daily prescription eye drop to treat blurry near vision for up to 10 hours. The most common side effects that may be experienced while using Viz include eye irritation, temporary dimmer, dark vision, headaches and eye redness. Talk to an eye doctor to learn if Viz is right for you. Learn more at Viz.com. If you've been following the news, you know the world is dealing with a level of uncertainty that isn't going away anytime soon. inflation pressures, global tensions, and the highest U.S. debt levels on record continue to influence

markets day after day, and the result is familiar to anyone checking their retirement balances or savings accounts. Volatility has become the norm. In times like these, people often look for ways to strengthen their financial foundation. Physical gold and silver have served that purpose throughout history. They're real assets that exist outside the digital and financial systems that tend to fluctuate during economic stress. They're not a guarantee and they're not a shortcut to wealth, They can offer diversification when things feel unpredictable. Preserve gold is committed to helping Americans understand their options with simple educational information, including how precious metals can be held in an IRA.

For your free wealth protection guide, text IHeart to 50505. And with a qualified purchase, you could receive up to $15,000 in free gold or silver. Don't wait. Text IHeart to 50505. With the power and endurance of Toyota trucks, you can go to the most incredible places. Valley where the echo does different voices. Hello. Hello.

Hello. We know what we're made of. Toyota trucks. You're listening to. What are we waiting for? Well, what are you waiting for? One, two, ready, go. Action!

In The Hester's Edge. With Gary Kaltba. So, imagine if you brought me your car that had engine problems. Gary, can you fix my car? Well, let me explain. I don't know what the hell is under the hood of any car. I know nothing about car engines. About the only thing I can tell you is what a battery looks like,

the little dipstick with the oil, I can pull out, maybe a couple of other things, I would have no clue what to do. Jay Powell today, let me quote him, market seems to be okay with what we have communicated. The market's okay, he said, with what they have communicated. I am pretty damn sure the man does not smoke weed. I am pretty damn sure he doesn't do ecstasy.

I don't think he's an alcoholic. I think maybe he has a couple of glasses of red wine on the weekend, but I do believe he's mostly lucid. He said that the market seems to be okay with what we have communicated. This scares the living crap out of me, that he has no idea what's been going on. I just told you yields on the tenure went from 2.7 to almost 3.5 in 11 days. That's a sick move to the upside into the Fed raid hike.

What do you think that is? That's a vote of no confidence. I saw an economist say, oh, it's a vote of confidence that, oh, market went up today and yields went down. No, it isn't. The only reason that happened today is because, for 11 days, it went the other way into today. Does Jay Powell not know that all the bubbles have been busted? Crushed?

He's got to know that all the coins have crashed. Does he not know that 50% of the NASDAQ is down over 50%? 22% of the NASDAQ is down 75%, nearing 10% of the NASDAQ down 90%. Does he not know any of this? I don't think he's lying. Can he be that much of a head buried in the sand? Does he not know Netflix? A mainstay of every mutual fund portfolio is down 70-some-odd percent,

Facebook down 50 percent? Does he not know some of the top financial stocks? The Grand Puba's? are down in the mid-30s, if not more? And he says today, market seems to be okay. I remain worried just on that statement. He's still the most powerful person on this earth.

He is. Most powerful person on this earth. The European Central Bank, well, I should take that back. European Central Bank is five times as sane as Jay Powell. That's Christine Lagarde. Go look her up. They have still negative rates as of today. I have no clue what happens tomorrow.

Bulls should be disappointed with today's close considering the big drop in yields today. Maybe the market knows that all today was was a relief rally from an unbelievable move of the last. 11, 12 days, both in stock markets and bond markets. Again, I have no clue about tomorrow and don't even want to profess to know. Bond market remains in a bare market, stock market remains in a bare market, the yields remain in a bull market.

Oil, down another two and a half bucks today. Good. Think oil prices have dropped from like 122 to 113 and change. if it stays down should help at the pump. We'll take any of that. Remember, nothing bad happens if oil prices keep coming down for you. The other good news you savers out there, you're finally getting some coin. Yell at your lenders or banks if they are not paying you on your money.

You got that? And guess what they're going to have to start doing? Competing for your money. They haven't had to for a very long while, which really pissed me off, brought to you by Jay Powell. You're going to start to see advertisements again on CDs. We'll beat the next guy. Money markets. We're better than the next guy. So look around. You people holding cash instead of making zero on 100 grand, you're 1,500 per year or approximately. Remember I told you the nuts bought Austrian bonds at 8 tenths of a percent that were 100 years?

And I told you it was a magnificent disaster waiting to happen. They're down 70%. But don't worry, in 100 years you'll get back your money. On that note, you have a great evening drive carefully. Tomorrow I'll be on with Stuart Varney at 9 a.m. Fox business, check it out. And when you get home, do like we do. Simple procedure.

make sure you hug your family, hug your children. They will feel better, you will feel better. I promise. Until tomorrow, same time. Thanks for joining. Peace out. This has been Investor's Edge with Gary Cult Bomb on BizTalk. To listen to past episodes or to get in contact with Gary, go to GaryK.com.

That's GaryK.com. With the power and endurance of Toyota trucks, you can go to the most incredible places, like this valley, where the Echo does this. different voices. Hello! Hello! We know what we're made of. Toyota trucks.

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