1 00:00:00,000 --> 00:00:01,520 Speaker 1: If you're just tuning in, you're listening to the Mark 2 00:00:01,600 --> 00:00:03,600 Speaker 1: Mass Show. We always talk about the way the world 3 00:00:03,640 --> 00:00:05,200 Speaker 1: is changing as we look at it through the lens 4 00:00:05,200 --> 00:00:09,119 Speaker 1: of politics, finance, and technology, and today we are going 5 00:00:09,160 --> 00:00:12,319 Speaker 1: to look at where the economic world is moving into. 6 00:00:12,680 --> 00:00:16,160 Speaker 1: This continues to further discussions that we've had showing what 7 00:00:16,200 --> 00:00:19,800 Speaker 1: the natural constraints of the central bankers and politicians are. 8 00:00:19,920 --> 00:00:23,080 Speaker 1: So we know what moves are coming and so we're 9 00:00:23,120 --> 00:00:25,160 Speaker 1: going to break that down. So, like I said, most 10 00:00:25,239 --> 00:00:28,560 Speaker 1: people have been watching the doom, the doom and the gloom, 11 00:00:28,800 --> 00:00:32,320 Speaker 1: the doom scrolling if you will, across YouTube and Twitter 12 00:00:32,400 --> 00:00:35,880 Speaker 1: and Instagram, et cetera, and unfortunately the doom and gloom cells, 13 00:00:36,080 --> 00:00:39,400 Speaker 1: which is why people continue to do it. I have 14 00:00:39,600 --> 00:00:41,960 Speaker 1: found myself in this trap all though for the last 15 00:00:42,040 --> 00:00:44,400 Speaker 1: year so I've been trying to be much more optimistic. 16 00:00:44,440 --> 00:00:47,160 Speaker 1: I always was, but I was still using some doom 17 00:00:47,240 --> 00:00:49,200 Speaker 1: to sort of bring people in. However, I've been trying 18 00:00:49,200 --> 00:00:53,800 Speaker 1: to change that and a lot of people aren't. And 19 00:00:53,880 --> 00:00:57,120 Speaker 1: we're seeing that. The reason why is we kind of 20 00:00:57,160 --> 00:01:00,400 Speaker 1: know this. We see social media post things for engage. 21 00:01:00,680 --> 00:01:04,480 Speaker 1: Rage gets more engagement, rage fear those to get more engagement, 22 00:01:04,480 --> 00:01:07,120 Speaker 1: it starts to divide us. Mainstream media they show us 23 00:01:07,120 --> 00:01:09,600 Speaker 1: all the doom and gloom, and unfortunately, like I said, 24 00:01:09,680 --> 00:01:14,039 Speaker 1: that's what sells. And while most people are so worried 25 00:01:14,080 --> 00:01:17,240 Speaker 1: about their watching every video on, you know, the debt 26 00:01:17,280 --> 00:01:19,680 Speaker 1: of the United States and the bond market's going to 27 00:01:19,720 --> 00:01:22,320 Speaker 1: implode and the yield curve is going to reinvert, and 28 00:01:22,360 --> 00:01:26,520 Speaker 1: it's going to mean recession. Recession, recession, recession. What does 29 00:01:26,560 --> 00:01:31,279 Speaker 1: that mean? Everyone's afraid of a recession. But why well, 30 00:01:31,440 --> 00:01:35,120 Speaker 1: I mean technically, a recession would be that growth is slowing, 31 00:01:35,319 --> 00:01:37,480 Speaker 1: so that means businesses aren't doing as good, You're not 32 00:01:37,560 --> 00:01:40,200 Speaker 1: making as much money, and ultimately your quality of life 33 00:01:40,240 --> 00:01:43,880 Speaker 1: would go down. Okay, that that sounds pretty bad and 34 00:01:43,920 --> 00:01:47,800 Speaker 1: it is. However, we also then the other side of 35 00:01:47,840 --> 00:01:50,320 Speaker 1: a recession. We have what's called the markets. So we 36 00:01:50,360 --> 00:01:53,559 Speaker 1: have the economy and we have the markets. Now, those 37 00:01:53,560 --> 00:01:55,960 Speaker 1: things used to be the same. You see in the 38 00:01:56,040 --> 00:01:59,080 Speaker 1: economy when businesses when when you and I the people 39 00:01:59,120 --> 00:02:01,680 Speaker 1: did good, then the business is good. When the businesses 40 00:02:02,120 --> 00:02:04,440 Speaker 1: did good, then the markets did good because we would 41 00:02:04,440 --> 00:02:08,079 Speaker 1: buy those businesses through publicly traded stocks and equities. And 42 00:02:08,120 --> 00:02:11,200 Speaker 1: when those businesses did good, meaning their revenues went up, 43 00:02:11,240 --> 00:02:14,359 Speaker 1: their profits went up, then their stock would go up, 44 00:02:14,639 --> 00:02:18,000 Speaker 1: and so then we were all in this together. We 45 00:02:18,040 --> 00:02:20,399 Speaker 1: made more money, which means we spent more money, which 46 00:02:20,440 --> 00:02:22,880 Speaker 1: means the business did better. So the economy did better, 47 00:02:22,880 --> 00:02:27,120 Speaker 1: which then meant the markets did better. But that's no 48 00:02:27,240 --> 00:02:30,560 Speaker 1: longer the case. As a matter of fact, I've been 49 00:02:31,680 --> 00:02:37,679 Speaker 1: most economists talk about sort of pre COVID era. I don't. 50 00:02:37,800 --> 00:02:41,640 Speaker 1: I don't. Maybe maybe we can call it BC before COVID. 51 00:02:42,400 --> 00:02:45,040 Speaker 1: And really the world changed in two thousand and eight, 52 00:02:45,040 --> 00:02:47,480 Speaker 1: and specifically the markets and the economy changed. Specifically, the 53 00:02:47,520 --> 00:02:50,680 Speaker 1: way that the governments and central banks work in the 54 00:02:50,720 --> 00:02:55,200 Speaker 1: markets changed. This is something I've talked about quite extensively. Really, 55 00:02:55,840 --> 00:02:58,960 Speaker 1: the way central banks and the governments changed the way 56 00:02:58,960 --> 00:03:01,000 Speaker 1: they interacted the markets happened in two thousand and eight, 57 00:03:01,800 --> 00:03:04,880 Speaker 1: and since then it's only continued to accelerate and get 58 00:03:04,919 --> 00:03:07,320 Speaker 1: bigger and bigger and bigger and bigger. We've seen it. 59 00:03:07,400 --> 00:03:08,880 Speaker 1: You know, I'm not going to go through the whole 60 00:03:08,880 --> 00:03:11,440 Speaker 1: timeline and history of this, but twenty twenty, I mean, 61 00:03:11,480 --> 00:03:13,760 Speaker 1: it was just put into steroids, was put into overdrive. 62 00:03:14,360 --> 00:03:16,040 Speaker 1: And so now we sort of have to when we 63 00:03:16,120 --> 00:03:18,079 Speaker 1: look at economic data financial data, we have to sort 64 00:03:18,080 --> 00:03:21,200 Speaker 1: of look at like pre COVID era, and so we'll 65 00:03:21,200 --> 00:03:22,679 Speaker 1: talk about a little bit of that. We also to 66 00:03:22,720 --> 00:03:24,400 Speaker 1: look at like two thousand and eight era. But what 67 00:03:24,480 --> 00:03:26,720 Speaker 1: I was going to say is in the twenty twenty era, 68 00:03:26,840 --> 00:03:29,639 Speaker 1: what we saw maybe for the first time, or really 69 00:03:29,840 --> 00:03:32,440 Speaker 1: became obvious to everybody for the first time, was that 70 00:03:32,520 --> 00:03:36,280 Speaker 1: the economy in the market split. They were no longer 71 00:03:36,400 --> 00:03:38,720 Speaker 1: equal to each other anymore like they did in the past. 72 00:03:38,880 --> 00:03:43,760 Speaker 1: So what we saw is that literally literally all, you know, 73 00:03:43,840 --> 00:03:46,960 Speaker 1: not all, but a majority of businesses, the economy was 74 00:03:47,040 --> 00:03:49,600 Speaker 1: shut down like a light switch, turn the lights off, 75 00:03:49,640 --> 00:03:52,000 Speaker 1: turned the economy off, not just in the United States, 76 00:03:52,200 --> 00:03:54,200 Speaker 1: but most of the world, pretty much the whole world 77 00:03:54,280 --> 00:03:57,200 Speaker 1: at the same time. So the economy was shut down. 78 00:03:57,320 --> 00:04:01,440 Speaker 1: We saw countless people lose their jobs. We saw countless 79 00:04:02,040 --> 00:04:05,400 Speaker 1: millions of businesses literally shut down. Businesses that have been 80 00:04:05,440 --> 00:04:09,880 Speaker 1: around for multiple decades, multiple generations, were shut down permanently 81 00:04:09,920 --> 00:04:12,120 Speaker 1: for good. A lot of them never made it. You know, 82 00:04:12,240 --> 00:04:14,800 Speaker 1: here in southern California, up in like Hollywood, you have 83 00:04:14,840 --> 00:04:17,720 Speaker 1: all these iconic restaurants that have been around for decades. 84 00:04:18,080 --> 00:04:22,360 Speaker 1: You know, served, served, famous, serve famous, famous athletes from 85 00:04:22,839 --> 00:04:26,080 Speaker 1: way way way back, and they're just gone. Now. Landmarks 86 00:04:26,160 --> 00:04:28,360 Speaker 1: are gone. Right, And so we saw literally the economy 87 00:04:28,720 --> 00:04:32,760 Speaker 1: shut off, but then the markets, meaning the stock markets 88 00:04:32,760 --> 00:04:35,960 Speaker 1: and things like that made crazy all new all time high. 89 00:04:36,040 --> 00:04:38,200 Speaker 1: So how does that work? How can we have a 90 00:04:38,279 --> 00:04:40,880 Speaker 1: recession and yet we have a boom in the markets 91 00:04:40,880 --> 00:04:42,800 Speaker 1: at the same time. Well, that's the world that we 92 00:04:42,839 --> 00:04:44,960 Speaker 1: live in, and so it's important to understand that. So 93 00:04:45,000 --> 00:04:47,040 Speaker 1: when everyone's afraid of a recession, we have to understand 94 00:04:47,080 --> 00:04:48,920 Speaker 1: what are we afraid of? You See, this is a 95 00:04:49,000 --> 00:04:51,200 Speaker 1: question that I get asked a lot mark. What are 96 00:04:51,200 --> 00:04:54,240 Speaker 1: we going to do to protect ourselves from inflation, or 97 00:04:54,279 --> 00:04:57,960 Speaker 1: from a recession, or from central bank digital currencies, or 98 00:04:58,000 --> 00:05:00,040 Speaker 1: from attacks on our privacy things like that, if what 99 00:05:00,040 --> 00:05:02,279 Speaker 1: if the electricity goes out? All these different things. And 100 00:05:02,320 --> 00:05:06,599 Speaker 1: what I always typically, always, typically, typically always reply back 101 00:05:06,600 --> 00:05:10,400 Speaker 1: with is what is the attack vector you're trying to 102 00:05:10,400 --> 00:05:15,280 Speaker 1: protect against? So, for example, if I think that if 103 00:05:15,320 --> 00:05:18,000 Speaker 1: I'm worried about a recession, okay, then what is it 104 00:05:18,040 --> 00:05:20,719 Speaker 1: that I'm afraid of the recession for while I'm afraid 105 00:05:20,760 --> 00:05:24,920 Speaker 1: that my job might get taken out? Okay? Well, if 106 00:05:24,960 --> 00:05:27,360 Speaker 1: you're in a if you're in a job you work 107 00:05:27,440 --> 00:05:31,279 Speaker 1: for a business that's highly dependent on the let's say 108 00:05:31,560 --> 00:05:33,960 Speaker 1: on economy, that would be highly influenced by a recession, 109 00:05:34,000 --> 00:05:35,880 Speaker 1: that could be a problem. But I could have a 110 00:05:35,920 --> 00:05:40,160 Speaker 1: job that's not recession. I guess that that is recession proof. 111 00:05:40,200 --> 00:05:42,440 Speaker 1: So let me give you an example. If I was 112 00:05:42,480 --> 00:05:47,800 Speaker 1: in a business that was only catered to tourists, for example, 113 00:05:47,839 --> 00:05:50,600 Speaker 1: it was all tourism based. Well, in a bad recession, 114 00:05:50,720 --> 00:05:54,200 Speaker 1: tourism might slow down, and so my business might be 115 00:05:54,279 --> 00:05:56,240 Speaker 1: impacted by that. I might lose my job, or if 116 00:05:56,279 --> 00:05:59,279 Speaker 1: I have a business in that sector, I might suffer. However, 117 00:05:59,839 --> 00:06:01,880 Speaker 1: I have a buddy who has a business where he 118 00:06:01,920 --> 00:06:06,000 Speaker 1: does like flood and fire restoration. So if your house 119 00:06:06,040 --> 00:06:09,520 Speaker 1: floods or your house gets a fire, he works for 120 00:06:09,600 --> 00:06:11,880 Speaker 1: the insurance companies and he will go fix your house. 121 00:06:13,240 --> 00:06:16,599 Speaker 1: That business is recession proof. It doesn't matter where the 122 00:06:16,640 --> 00:06:18,960 Speaker 1: recession's at. If you have a fire or flood at 123 00:06:18,960 --> 00:06:21,159 Speaker 1: your house, insurance going to pay for it. And so 124 00:06:21,360 --> 00:06:22,760 Speaker 1: you have to kind of think about what am I 125 00:06:22,800 --> 00:06:25,840 Speaker 1: trying to protect against. Some people think, well, a recession 126 00:06:25,880 --> 00:06:28,120 Speaker 1: is just bad for the market. So like if we 127 00:06:28,160 --> 00:06:30,840 Speaker 1: have a recession, then my retirement accounts are going to 128 00:06:30,880 --> 00:06:32,920 Speaker 1: get cut in half, my value of my home is 129 00:06:32,960 --> 00:06:35,440 Speaker 1: going to get cut in half. And that's where we 130 00:06:35,440 --> 00:06:38,839 Speaker 1: want to talk about today because is that necessarily the case. 131 00:06:39,680 --> 00:06:41,040 Speaker 1: Let's just take a look at some of the data. 132 00:06:41,080 --> 00:06:46,080 Speaker 1: So what we saw this week officially Japan, the Japanese 133 00:06:46,120 --> 00:06:50,800 Speaker 1: economy officially shrinks unexpectedly. In the final quarter of twenty 134 00:06:50,839 --> 00:06:54,719 Speaker 1: twenty three, the gross domestic product or GDP was down 135 00:06:55,320 --> 00:06:58,880 Speaker 1: zero point one percent. Very dramatic. I know, I know, 136 00:06:59,000 --> 00:07:01,919 Speaker 1: very dramatic, but it's down and it's technical, right we 137 00:07:02,160 --> 00:07:04,800 Speaker 1: want it. We ow to understand this. Japan dropped a 138 00:07:04,920 --> 00:07:08,120 Speaker 1: rank in the global standings and went to become the 139 00:07:08,160 --> 00:07:11,720 Speaker 1: fourth largest economy now after the weekend of twenty twenty three, 140 00:07:12,200 --> 00:07:15,160 Speaker 1: and it was weaker than what most economists had projected it. 141 00:07:15,200 --> 00:07:17,040 Speaker 1: So these economist always trying to project where things are 142 00:07:17,040 --> 00:07:19,800 Speaker 1: going because markets are forward looking. And so what we 143 00:07:19,840 --> 00:07:24,400 Speaker 1: see is that the economists had forecasted zero point two growth, 144 00:07:25,080 --> 00:07:29,160 Speaker 1: but then the economy actually contracted, so is much worse 145 00:07:29,200 --> 00:07:32,400 Speaker 1: than what they had thought. Now zero point one doesn't 146 00:07:32,400 --> 00:07:36,520 Speaker 1: sound like a lot, but technically, now the Japanese economy 147 00:07:36,680 --> 00:07:40,320 Speaker 1: is in a recession, and because it's now contracted for 148 00:07:40,480 --> 00:07:44,200 Speaker 1: two consecutive quarters. Now, if you remember, the Biden administration 149 00:07:44,400 --> 00:07:47,640 Speaker 1: changed the definition of that, So technically two quarters and 150 00:07:48,160 --> 00:07:52,080 Speaker 1: to contracting quarters consecutive quarters don't mean a recession in 151 00:07:52,080 --> 00:07:54,720 Speaker 1: the United States anymore. But in this case, they're declaring 152 00:07:55,120 --> 00:07:58,000 Speaker 1: Japan to technically be in a recession. Now, the data 153 00:07:58,040 --> 00:08:02,520 Speaker 1: is preliminary, is small enough I mean, zero point one, 154 00:08:02,560 --> 00:08:04,640 Speaker 1: and small enough to leave room for doubt. So what 155 00:08:04,640 --> 00:08:06,640 Speaker 1: does that mean. I mean this preliminary, It means they're 156 00:08:06,720 --> 00:08:12,400 Speaker 1: still gonna retally the numbers and the margin is so 157 00:08:12,480 --> 00:08:14,600 Speaker 1: small we might be able to just find a little 158 00:08:14,640 --> 00:08:17,400 Speaker 1: bit of extra you know, economic activity over here in 159 00:08:17,440 --> 00:08:19,880 Speaker 1: the corner and bring it in and then when we 160 00:08:19,960 --> 00:08:23,080 Speaker 1: revise the estimates that are going to come in next month, 161 00:08:23,600 --> 00:08:25,720 Speaker 1: I mean, maybe it could paint a different picture. So 162 00:08:26,480 --> 00:08:28,920 Speaker 1: that's where we're at. Okay, So technically, as of today 163 00:08:29,160 --> 00:08:31,520 Speaker 1: we've slipped. It could be revised and will be out. 164 00:08:31,520 --> 00:08:35,400 Speaker 1: But does it really matter whether Japan is in a 165 00:08:35,520 --> 00:08:38,439 Speaker 1: recession right now? Could be debatable? Right, Like I said that, 166 00:08:38,520 --> 00:08:43,040 Speaker 1: the information is still gonna get revised. And what's interesting 167 00:08:43,080 --> 00:08:46,560 Speaker 1: about this is though, even though the GDP contracted for 168 00:08:46,640 --> 00:08:50,199 Speaker 1: a second straight quarter. When we look at other data, 169 00:08:50,280 --> 00:08:53,080 Speaker 1: such as business surveys, it tells us a completely different story. 170 00:08:53,280 --> 00:08:55,120 Speaker 1: And this is why you can't rely on any one indicator. 171 00:08:55,160 --> 00:08:56,319 Speaker 1: You have to look at lots of different things. So 172 00:08:56,320 --> 00:08:58,080 Speaker 1: when we look at some of the business data, some 173 00:08:58,120 --> 00:09:01,320 Speaker 1: of the business surveys, and we look at the labor market, 174 00:09:01,360 --> 00:09:03,880 Speaker 1: it looks like something different. So, for example, if you 175 00:09:03,880 --> 00:09:06,440 Speaker 1: look at Japan's unemployment, and don't worry, it's not all 176 00:09:06,480 --> 00:09:08,640 Speaker 1: about Japan. We're going to talk about EU. We're gonna 177 00:09:08,640 --> 00:09:12,160 Speaker 1: talk about the We're gonna talk about the the EU, 178 00:09:12,200 --> 00:09:14,240 Speaker 1: we're talking about England, and we're gonna talk about the 179 00:09:14,280 --> 00:09:15,760 Speaker 1: United States. We're gonna get through all these but we're 180 00:09:15,760 --> 00:09:18,200 Speaker 1: talking about Japan for a second here. But I gotta 181 00:09:18,200 --> 00:09:19,959 Speaker 1: take a very quick break. If you're just tuning in 182 00:09:20,000 --> 00:09:22,680 Speaker 1: your listening to the Mark Moas Show, we're talking about 183 00:09:23,200 --> 00:09:26,280 Speaker 1: recession and markets and booms and busts and so much more. 184 00:09:26,280 --> 00:09:27,719 Speaker 1: You don't want to miss what's coming up next. Don't 185 00:09:27,760 --> 00:09:30,120 Speaker 1: go away, I'll be right back, all right, Welcome back. 186 00:09:30,120 --> 00:09:31,520 Speaker 1: If you just tune in your listening to the Mark 187 00:09:31,600 --> 00:09:35,280 Speaker 1: Moas Show, we're talking about how the United States and 188 00:09:35,520 --> 00:09:38,640 Speaker 1: other major nations that major economies around the world are 189 00:09:38,840 --> 00:09:42,520 Speaker 1: technically falling into recession, but is it as bad as 190 00:09:42,520 --> 00:09:44,319 Speaker 1: what people think it is? And so we're looking at that, 191 00:09:44,320 --> 00:09:46,679 Speaker 1: we're talking about Japan right now. We'll get to the EU, 192 00:09:46,800 --> 00:09:49,400 Speaker 1: we'll get to Britain, we'll get into the US, but 193 00:09:49,480 --> 00:09:50,920 Speaker 1: right now we're just talking about Japan. And so what 194 00:09:50,960 --> 00:09:54,559 Speaker 1: I was saying is technically we're in a recession, very 195 00:09:54,640 --> 00:09:58,559 Speaker 1: very small zero point one percent of contraction in that. However, 196 00:09:58,640 --> 00:10:00,240 Speaker 1: the data is still going to be revised and be 197 00:10:00,360 --> 00:10:03,080 Speaker 1: released next month, and so it could change. But the 198 00:10:03,120 --> 00:10:04,840 Speaker 1: point that I was making is though even though that 199 00:10:04,880 --> 00:10:08,080 Speaker 1: never came out, some of the other data is contradictory 200 00:10:08,080 --> 00:10:10,320 Speaker 1: of that. And so, for example, business surveys of the 201 00:10:10,360 --> 00:10:12,400 Speaker 1: labor market are telling a different story. We can see 202 00:10:12,440 --> 00:10:15,840 Speaker 1: in the unemployment which fell to an eleven month low 203 00:10:15,960 --> 00:10:19,439 Speaker 1: in December, which is pretty interesting. So typically you think 204 00:10:19,440 --> 00:10:21,959 Speaker 1: of a recession like, oh my gosh, gross slows down, 205 00:10:22,000 --> 00:10:24,240 Speaker 1: I'm probably going to lose my job, But in this case, 206 00:10:24,320 --> 00:10:27,880 Speaker 1: unemployment actually has continues to fall lower and lower and lower, 207 00:10:28,040 --> 00:10:31,440 Speaker 1: which showed that business conditions across all industries and firm 208 00:10:31,480 --> 00:10:35,959 Speaker 1: sizes were the strongest they've been since twenty eighteen. It's 209 00:10:35,960 --> 00:10:39,640 Speaker 1: pretty interesting. So GDP's slowing down, although the job markets 210 00:10:39,640 --> 00:10:41,960 Speaker 1: the strongest it's been since twenty eighteen. Now we're going 211 00:10:42,040 --> 00:10:44,320 Speaker 1: to talk about why that is in a minute. Let's 212 00:10:44,360 --> 00:10:48,200 Speaker 1: just keep going. We can see that many economists expect 213 00:10:48,280 --> 00:10:51,679 Speaker 1: makeup Japan to now end its policy of negative short 214 00:10:51,760 --> 00:10:54,120 Speaker 1: term interest rates. They had wanted them to the Japan 215 00:10:54,920 --> 00:10:57,920 Speaker 1: the boj bankup Japan kept saying they were going to. 216 00:10:58,720 --> 00:11:01,679 Speaker 1: But how can they now? And we'll talk about why 217 00:11:01,720 --> 00:11:06,920 Speaker 1: this is important, But how can with these GDP numbers 218 00:11:06,960 --> 00:11:11,160 Speaker 1: of contracting growth, how could the boj think about ending 219 00:11:11,640 --> 00:11:14,640 Speaker 1: negative vent rates or going to a tightening cycle. And 220 00:11:14,720 --> 00:11:17,640 Speaker 1: the answer is they probably can't. So this leads into 221 00:11:17,760 --> 00:11:19,800 Speaker 1: where we're going. But let me just hit on a 222 00:11:19,840 --> 00:11:22,200 Speaker 1: couple more points here about Japan. Like I said, it 223 00:11:22,240 --> 00:11:24,960 Speaker 1: lost its spot from the third biggest economy to go 224 00:11:24,960 --> 00:11:29,120 Speaker 1: into the fourth and now is in this technical recession. 225 00:11:30,400 --> 00:11:33,040 Speaker 1: And so what comes next and again understanding of some 226 00:11:33,080 --> 00:11:34,840 Speaker 1: of the constraints, we'll talk about that, but let's jump 227 00:11:34,920 --> 00:11:37,520 Speaker 1: over to the European continent for a minute, and what 228 00:11:37,559 --> 00:11:39,079 Speaker 1: we can see over in Europe is sort of the 229 00:11:39,120 --> 00:11:42,400 Speaker 1: same thing the whole Euro Area. For the most part, 230 00:11:42,440 --> 00:11:46,080 Speaker 1: the EU shows that the economy is now losing momentum 231 00:11:46,360 --> 00:11:49,120 Speaker 1: and they're starting to downgrade or slash their outlooks. So 232 00:11:49,160 --> 00:11:51,720 Speaker 1: we saw in the EU, we saw the GDP gross 233 00:11:51,760 --> 00:11:59,480 Speaker 1: domestic product was expanded expanded the zero point eight percent, 234 00:11:59,760 --> 00:12:04,200 Speaker 1: that's the outlook, but they had projected one point two 235 00:12:04,400 --> 00:12:07,959 Speaker 1: percent in a prior prediction. And again when you look 236 00:12:08,000 --> 00:12:11,280 Speaker 1: at public financials, when you look at governments, they try 237 00:12:11,280 --> 00:12:14,160 Speaker 1: to project out what the growth of our revenue profits 238 00:12:14,200 --> 00:12:18,040 Speaker 1: will be. The problem is when businesses, companies and governments 239 00:12:18,679 --> 00:12:22,520 Speaker 1: miss those projections and so downgrading that is pretty bad. 240 00:12:22,559 --> 00:12:26,000 Speaker 1: And going from one point two, which is bad growth 241 00:12:26,240 --> 00:12:29,040 Speaker 1: to zero point eight is like almost no growth, So 242 00:12:29,040 --> 00:12:31,680 Speaker 1: it's a pretty pretty big deal. Now, on the bright side, 243 00:12:31,760 --> 00:12:34,319 Speaker 1: they say that inflation has slowed down to two point 244 00:12:34,360 --> 00:12:38,640 Speaker 1: seven percent this year, which is basically matching the European 245 00:12:38,720 --> 00:12:41,679 Speaker 1: Central Bank's estimate, So that's good. So apparently they're getting 246 00:12:41,720 --> 00:12:45,200 Speaker 1: it under control. What we can see is that this 247 00:12:45,320 --> 00:12:48,079 Speaker 1: is through the EU, but in the UK they are 248 00:12:48,120 --> 00:12:50,959 Speaker 1: also suffering from the same thing. As a matter of fact, 249 00:12:51,440 --> 00:12:54,000 Speaker 1: they're dealing with the recession now as well, we can 250 00:12:54,040 --> 00:12:57,520 Speaker 1: see the UK recession deals a fresh blow to Sunak's 251 00:12:57,600 --> 00:13:01,439 Speaker 1: economic promises. And so what is that means? So again 252 00:13:01,600 --> 00:13:05,520 Speaker 1: we talked about the intersection of politics, finance and technology, 253 00:13:06,160 --> 00:13:09,959 Speaker 1: and finance should not be technical. I'm sorry, finance should 254 00:13:09,960 --> 00:13:12,559 Speaker 1: not be political, but yet it is. And so that's 255 00:13:12,600 --> 00:13:14,480 Speaker 1: what we're talking about here. We can see that GDP 256 00:13:14,600 --> 00:13:17,240 Speaker 1: fell zero point three percent in the fourth quarter of 257 00:13:17,320 --> 00:13:21,920 Speaker 1: last year. Again, they had projected a zero point one 258 00:13:22,000 --> 00:13:25,719 Speaker 1: percent drop, so again it was worse than they had expected. 259 00:13:26,720 --> 00:13:28,959 Speaker 1: Now we can see that this is affecting their Prime 260 00:13:29,000 --> 00:13:32,640 Speaker 1: Minister Rishi Sunac, who so far has failed to meet 261 00:13:32,720 --> 00:13:35,679 Speaker 1: his pledge to grow the economy. And so this is 262 00:13:35,720 --> 00:13:39,480 Speaker 1: the big key. In order for politicians to stay in power, 263 00:13:39,640 --> 00:13:43,160 Speaker 1: one they have to promise more things. So each politician 264 00:13:43,280 --> 00:13:47,480 Speaker 1: is incentivized to offer you more free things. That's why 265 00:13:47,520 --> 00:13:49,920 Speaker 1: Biden is trying to slash student debt. Right. We have 266 00:13:49,960 --> 00:13:51,560 Speaker 1: to continue to give more and more stuff with to 267 00:13:51,559 --> 00:13:53,880 Speaker 1: buy the votes, if you will. And so Prime Minister 268 00:13:53,960 --> 00:13:56,320 Speaker 1: Rishi came in with a whole bunch of promises. I'm 269 00:13:56,320 --> 00:13:58,280 Speaker 1: going to list them here in a second, one of 270 00:13:58,320 --> 00:14:00,920 Speaker 1: which was to grow the economy and in the United States, 271 00:14:00,960 --> 00:14:02,760 Speaker 1: it's also as important. We'll come to the US, but 272 00:14:03,320 --> 00:14:06,960 Speaker 1: no income and president or maybe only one meaning a 273 00:14:07,000 --> 00:14:10,360 Speaker 1: returning president, has won. In a time of recession, the 274 00:14:10,440 --> 00:14:14,360 Speaker 1: economy has to be growing. Rishi Sunik pledged that he 275 00:14:14,400 --> 00:14:18,040 Speaker 1: would grow the economy, but yet grossmc product is falling, 276 00:14:19,240 --> 00:14:22,560 Speaker 1: and it's falling faster than what the economists had predicted. 277 00:14:24,000 --> 00:14:26,280 Speaker 1: It says. While the economy still grews zero point one 278 00:14:26,320 --> 00:14:29,840 Speaker 1: percent across the entire year as a whole, it's the 279 00:14:29,960 --> 00:14:33,960 Speaker 1: slowest annual expansion the UK has seen since two thousand 280 00:14:34,000 --> 00:14:38,040 Speaker 1: and nine. So that's pretty bad now. If you think 281 00:14:38,040 --> 00:14:40,240 Speaker 1: about that. That's two thousand and eight. Two thousande was 282 00:14:40,240 --> 00:14:43,840 Speaker 1: the Great financial Crash, so after the worst crash in history, 283 00:14:43,880 --> 00:14:46,600 Speaker 1: we had a rebound that typically happens. But since then 284 00:14:46,680 --> 00:14:48,800 Speaker 1: we've been in this up trend for the last decade, 285 00:14:48,840 --> 00:14:52,320 Speaker 1: twelve years, fourteen years, and it's the worst that it's 286 00:14:52,360 --> 00:14:55,920 Speaker 1: been since that time. It's pretty bad now. We can 287 00:14:55,920 --> 00:14:59,480 Speaker 1: see that this is a like I said, it was 288 00:14:59,520 --> 00:15:05,080 Speaker 1: anticipate paid, but it's giving the Bank of England the 289 00:15:05,160 --> 00:15:07,960 Speaker 1: same problem that the Bank of Japan is having, which 290 00:15:08,000 --> 00:15:11,480 Speaker 1: is actually the same problem that the US central banks, 291 00:15:11,480 --> 00:15:15,120 Speaker 1: the Federal Reserve is having as well, which is what 292 00:15:15,960 --> 00:15:19,400 Speaker 1: can they do to fight inflation when at the same 293 00:15:19,440 --> 00:15:24,160 Speaker 1: time they're fighting recession. You see, the recession needs stimulation. 294 00:15:24,400 --> 00:15:27,960 Speaker 1: The recession needs easy monetary policy to try to get 295 00:15:28,000 --> 00:15:31,080 Speaker 1: the economy out of the recession. If we can make 296 00:15:31,160 --> 00:15:33,680 Speaker 1: money cheaper, then people will buy more of it, will 297 00:15:33,720 --> 00:15:36,840 Speaker 1: take on more house, car, boat loans, We'll expand our businesses, 298 00:15:37,000 --> 00:15:39,520 Speaker 1: We'll go remodel our house, fix our yard up. We'll 299 00:15:39,520 --> 00:15:42,680 Speaker 1: spend more money, and that stimulation in the market will 300 00:15:42,800 --> 00:15:44,960 Speaker 1: bring us out, hopefully. The goal is to bring us 301 00:15:44,960 --> 00:15:48,360 Speaker 1: out of recession. The problem is is that it restokes inflation, 302 00:15:48,960 --> 00:15:51,840 Speaker 1: and so on one hand they're fighting the inflation, but 303 00:15:52,040 --> 00:15:56,920 Speaker 1: they're overtightening, which is then causing the recession. It's the 304 00:15:57,000 --> 00:15:58,680 Speaker 1: rock and the hard place. We've been talking about this 305 00:15:58,680 --> 00:16:02,360 Speaker 1: for a long time. Now made again, like I said, 306 00:16:02,400 --> 00:16:06,000 Speaker 1: made growing the economy one of five key pledges after 307 00:16:06,040 --> 00:16:08,560 Speaker 1: he took office back in October of twenty twenty two. 308 00:16:09,040 --> 00:16:13,960 Speaker 1: The other ones were cutting the debt, having inflation, reducing 309 00:16:14,040 --> 00:16:18,680 Speaker 1: health services, waiting lists, and stopping boat migration across the 310 00:16:18,720 --> 00:16:23,359 Speaker 1: English Channel. So far, out of all those pledges, those promises. 311 00:16:23,360 --> 00:16:27,240 Speaker 1: Elect me, and I'll get these things done. Out of 312 00:16:27,280 --> 00:16:28,840 Speaker 1: all of those, the only thing he's been able to 313 00:16:28,880 --> 00:16:30,840 Speaker 1: do is been able to slow down price growth. Now 314 00:16:30,920 --> 00:16:33,560 Speaker 1: I say he's been able to do, he's certainly not 315 00:16:33,600 --> 00:16:37,320 Speaker 1: responsible for that. A lot of it is returning to 316 00:16:37,360 --> 00:16:40,160 Speaker 1: the mean. So again, we had this COVID era, this 317 00:16:40,520 --> 00:16:42,120 Speaker 1: massive I call it like a sugar rush, all this 318 00:16:42,120 --> 00:16:44,240 Speaker 1: money dumped in the economy that created all these distortions, 319 00:16:44,240 --> 00:16:45,920 Speaker 1: and a lot of it's coming back to normal. So 320 00:16:45,960 --> 00:16:47,560 Speaker 1: I'm certainly not going to give him credit for that, 321 00:16:47,800 --> 00:16:51,240 Speaker 1: but to his credit, he'll certainly claim it. The one 322 00:16:51,360 --> 00:16:53,520 Speaker 1: thing out of all of those things is inflation has 323 00:16:53,520 --> 00:16:56,240 Speaker 1: started to come back down. But migrants that's not better, 324 00:16:57,440 --> 00:17:00,560 Speaker 1: health services waiting less, that hasn't gotten better. The debt 325 00:17:00,680 --> 00:17:04,840 Speaker 1: certainly hasn't gotten any less. That's laughable. And so none 326 00:17:04,880 --> 00:17:09,080 Speaker 1: of these things have worked. So what do they do well? 327 00:17:10,320 --> 00:17:12,240 Speaker 1: We need to kind of dig in a little bit 328 00:17:12,280 --> 00:17:14,920 Speaker 1: because there's a lot of nuance here. Like I said, one, 329 00:17:14,960 --> 00:17:16,879 Speaker 1: we want to understand what are the constraints. So we 330 00:17:16,960 --> 00:17:20,520 Speaker 1: know that this puts a lot of pressure on the 331 00:17:20,520 --> 00:17:23,960 Speaker 1: central bank. The bank now has to start cutting rates 332 00:17:24,000 --> 00:17:27,480 Speaker 1: faster and deeper than they had wanted to do, because 333 00:17:27,480 --> 00:17:30,560 Speaker 1: again they're trying to keep inflation at bay. And just 334 00:17:30,640 --> 00:17:33,920 Speaker 1: like all central banks Japan wanted to start tightening, they 335 00:17:33,920 --> 00:17:36,159 Speaker 1: can't do that now. The fed's trying to FED in 336 00:17:36,160 --> 00:17:38,720 Speaker 1: the US is trying to delay their pivot, but they're 337 00:17:38,840 --> 00:17:41,760 Speaker 1: being forced into it sooner. In the UK, same thing, 338 00:17:41,840 --> 00:17:45,359 Speaker 1: they're being forced into faster rate cuts at a faster rate, 339 00:17:45,440 --> 00:17:48,119 Speaker 1: psyching highicle than they had wanted to. Now, this is 340 00:17:48,840 --> 00:17:51,760 Speaker 1: the Europe, Europeans the EU, this is the UK, this 341 00:17:51,840 --> 00:17:55,560 Speaker 1: is Japan. And now we'll talk about the United States, 342 00:17:55,560 --> 00:17:58,199 Speaker 1: because retail sales are plunging in January, the worst year 343 00:17:58,240 --> 00:18:01,119 Speaker 1: over your growth since the COVID lockdown. But this is 344 00:18:01,160 --> 00:18:03,760 Speaker 1: only about the economy. What about the markets. I'll cover 345 00:18:03,800 --> 00:18:04,959 Speaker 1: that in a minute when I come back. If you're 346 00:18:05,000 --> 00:18:06,880 Speaker 1: just tuning in, youth in too, the Mark Mass Show, 347 00:18:07,920 --> 00:18:11,320 Speaker 1: talking about recession and markets, don't go away. We'll be 348 00:18:11,359 --> 00:18:14,479 Speaker 1: back with more a minute. Beer back, all right, welcome back. 349 00:18:14,520 --> 00:18:15,880 Speaker 1: If you're just tune in you Lily too, the Mark 350 00:18:15,920 --> 00:18:18,600 Speaker 1: Mass Show. We're talking about the whole world and going 351 00:18:18,600 --> 00:18:22,040 Speaker 1: into a recession right now, and does it matter and 352 00:18:22,080 --> 00:18:23,840 Speaker 1: if so, what should we do about it. So we're 353 00:18:23,840 --> 00:18:26,440 Speaker 1: talking about we talked about Japan going into recession technically 354 00:18:26,840 --> 00:18:29,359 Speaker 1: potentially could be revised out what technically it is, the 355 00:18:29,400 --> 00:18:32,800 Speaker 1: EU and then the UK, and now we'll talk about 356 00:18:32,800 --> 00:18:36,600 Speaker 1: the US. But the story is the same. All governments 357 00:18:36,960 --> 00:18:41,679 Speaker 1: and central banks have been fighting inflation, which inflation was 358 00:18:41,720 --> 00:18:44,920 Speaker 1: caused by printing too much money, creating too much money 359 00:18:44,920 --> 00:18:48,960 Speaker 1: through increasing the monitary base and credit expansion. The problem 360 00:18:49,040 --> 00:18:51,960 Speaker 1: is they created too much inflation by expanding that, and 361 00:18:52,000 --> 00:18:54,560 Speaker 1: they're trying to bring inflation back under control because people 362 00:18:54,560 --> 00:18:57,919 Speaker 1: get restless when you can't afford to feed your family 363 00:18:57,920 --> 00:18:59,399 Speaker 1: and you can't afford the same quality of life that 364 00:18:59,440 --> 00:19:03,280 Speaker 1: you've been living, and you're unhappy. And when people become unhappy, 365 00:19:03,320 --> 00:19:05,600 Speaker 1: then governments don't last very long. So they want to 366 00:19:05,600 --> 00:19:09,440 Speaker 1: bring inflation back down. But at the same time, by 367 00:19:09,600 --> 00:19:11,560 Speaker 1: trying to bring inflation back down, they have to do 368 00:19:11,560 --> 00:19:14,080 Speaker 1: the opposite. They have to contract the money supply them. 369 00:19:14,240 --> 00:19:16,600 Speaker 1: But when they contract the money supply, then the entire 370 00:19:16,640 --> 00:19:20,480 Speaker 1: economy starts to contract. Growth slows down or goes negative 371 00:19:20,560 --> 00:19:23,760 Speaker 1: is exactly what we're seeing. And then if people lose 372 00:19:23,800 --> 00:19:27,639 Speaker 1: their jobs, then they're even more unhappy. So what do 373 00:19:27,680 --> 00:19:29,600 Speaker 1: we do Damn. If we do dan, if we don't write, 374 00:19:29,680 --> 00:19:31,480 Speaker 1: we either continue to print the money that we need 375 00:19:31,520 --> 00:19:34,680 Speaker 1: for all of our endless programs that we want to 376 00:19:34,680 --> 00:19:38,520 Speaker 1: continue to fund and stimulate the economy and face inflation, 377 00:19:38,800 --> 00:19:41,399 Speaker 1: or we try to bring things back under control and 378 00:19:41,440 --> 00:19:47,240 Speaker 1: then we crash the economy. Those are the two choices. Now, 379 00:19:47,240 --> 00:19:48,879 Speaker 1: what we can see in the United States is retail 380 00:19:48,880 --> 00:19:51,000 Speaker 1: sales plunged in January. Like I said, worst year over 381 00:19:51,080 --> 00:19:54,840 Speaker 1: year growth since the COVID lockdown, which is pretty bad. 382 00:19:55,640 --> 00:19:59,360 Speaker 1: We saw that they unexpectedly surged in November and December, 383 00:20:00,160 --> 00:20:01,800 Speaker 1: now driven in a large pot by a jump in 384 00:20:01,840 --> 00:20:05,520 Speaker 1: the food services headline. Retail sales in January expected to 385 00:20:05,560 --> 00:20:10,000 Speaker 1: decline by just zero point two percent, but it was worse, 386 00:20:10,160 --> 00:20:15,080 Speaker 1: and it had been zero point six percent, so again 387 00:20:15,720 --> 00:20:19,720 Speaker 1: worse than expectations. This is the worst monthly decline since 388 00:20:19,840 --> 00:20:22,840 Speaker 1: March of twenty twenty three, and the worst year over 389 00:20:22,920 --> 00:20:27,320 Speaker 1: year rise since May of twenty twenty so that's a 390 00:20:27,320 --> 00:20:29,480 Speaker 1: big problem. We have the same issues going on in 391 00:20:29,520 --> 00:20:32,840 Speaker 1: the United States. The retail cells are plunging. Now we're 392 00:20:32,840 --> 00:20:35,480 Speaker 1: not technically in a recession like we have over in 393 00:20:35,560 --> 00:20:36,879 Speaker 1: Japan and we have in the EU and we have 394 00:20:36,920 --> 00:20:40,160 Speaker 1: in the UK. Technically the US is not, but it's slowing. 395 00:20:41,000 --> 00:20:43,000 Speaker 1: It's slowing now technically to be in a recession, to 396 00:20:43,000 --> 00:20:45,639 Speaker 1: be two negative quarters, we're not at that point yet. 397 00:20:46,080 --> 00:20:48,200 Speaker 1: But it's the trend, it's the direction that we're trying 398 00:20:48,200 --> 00:20:51,359 Speaker 1: to pay attention to. We can see that motor vehicles 399 00:20:51,680 --> 00:20:54,680 Speaker 1: and parts and building materials saw the largest decline month 400 00:20:54,720 --> 00:20:58,920 Speaker 1: over month on a year over year basis. Gas stations 401 00:20:58,920 --> 00:21:01,960 Speaker 1: building materials were the big drag, while online retailers and 402 00:21:02,000 --> 00:21:05,760 Speaker 1: food services were the biggest upside drivers of this. We 403 00:21:05,800 --> 00:21:10,080 Speaker 1: also saw core retail sales declined zero point five percent 404 00:21:10,119 --> 00:21:12,200 Speaker 1: month over month, which dragged the year overyear levels down 405 00:21:12,200 --> 00:21:15,720 Speaker 1: to the lowest level since the COVID lockdowns. Again, so 406 00:21:15,760 --> 00:21:17,600 Speaker 1: we can see that this is starting to be a 407 00:21:17,600 --> 00:21:20,680 Speaker 1: big problem. Basically, if we sum this up, Americans just 408 00:21:20,720 --> 00:21:23,000 Speaker 1: aren't buying as much stuff as they used to. That's 409 00:21:23,040 --> 00:21:25,440 Speaker 1: basically what this means. And so are we get into 410 00:21:25,440 --> 00:21:27,480 Speaker 1: that recession? Will we get to a recession? We don't 411 00:21:27,520 --> 00:21:30,439 Speaker 1: know how do we fight that, but we already know 412 00:21:30,480 --> 00:21:33,000 Speaker 1: the constraints that we're in. I believe, and I say 413 00:21:33,000 --> 00:21:34,920 Speaker 1: this all the time, I believe that when push comes 414 00:21:34,960 --> 00:21:37,600 Speaker 1: to shove, when you're forced to choose, when the central banks, 415 00:21:37,880 --> 00:21:41,840 Speaker 1: the BOJ, the ECB, the FED, when they're forced to 416 00:21:41,920 --> 00:21:45,000 Speaker 1: choose between one of two choices. And this is what 417 00:21:45,000 --> 00:21:48,480 Speaker 1: people don't understand. They have to choose one or the other. 418 00:21:48,520 --> 00:21:51,360 Speaker 1: They're trying to go right down the middle, but unfortunately 419 00:21:51,400 --> 00:21:53,679 Speaker 1: one or the other prevails. And the two choices, as 420 00:21:53,680 --> 00:21:57,320 Speaker 1: I already laid them out, are one we continue easing 421 00:21:57,359 --> 00:22:00,520 Speaker 1: the monetary cycle so we don't crash the entire economy. 422 00:22:00,560 --> 00:22:03,120 Speaker 1: People don't lose their jobs, business don't go under, and 423 00:22:03,200 --> 00:22:05,760 Speaker 1: we can continue to fund all these wars and all 424 00:22:05,800 --> 00:22:09,359 Speaker 1: these social programs and all these other programs. So we ease. 425 00:22:09,840 --> 00:22:12,240 Speaker 1: The problem if we do that is we have high inflation. 426 00:22:13,560 --> 00:22:15,880 Speaker 1: On the other side is we want to bring inflation 427 00:22:16,040 --> 00:22:18,040 Speaker 1: down because people get unhappy when they can't afford the 428 00:22:18,119 --> 00:22:21,480 Speaker 1: quality of life. But the problem is that then we 429 00:22:21,600 --> 00:22:24,760 Speaker 1: crash the economy. And I believe when flaced between those 430 00:22:24,800 --> 00:22:27,439 Speaker 1: two choices, they will choose inflation every time. And the 431 00:22:27,440 --> 00:22:32,639 Speaker 1: reason why is I think inflation is more incremental. I 432 00:22:32,680 --> 00:22:35,920 Speaker 1: would rather see my assets going higher. I would rather 433 00:22:35,920 --> 00:22:38,200 Speaker 1: see my bitcoin going up, which, by the way, it's 434 00:22:38,280 --> 00:22:40,240 Speaker 1: shooting to the moon right now. I love it. I'd 435 00:22:40,359 --> 00:22:42,320 Speaker 1: rather see my value of my homegowup. I'd rather see 436 00:22:42,320 --> 00:22:44,880 Speaker 1: the value of my stocks, my retirement account going up. 437 00:22:45,480 --> 00:22:48,600 Speaker 1: And if the prices of all my assets were going 438 00:22:48,720 --> 00:22:51,600 Speaker 1: up and my pay is going up, I can stomach 439 00:22:51,760 --> 00:22:53,600 Speaker 1: the higher prices I have to pay at the gas 440 00:22:53,640 --> 00:22:55,560 Speaker 1: pump and the airline tickets and my food and all 441 00:22:55,560 --> 00:22:59,920 Speaker 1: those things. However, if I lose my job, I lose 442 00:23:00,119 --> 00:23:04,720 Speaker 1: my business, and I lose all my income, I'm very unhappy. 443 00:23:04,800 --> 00:23:08,159 Speaker 1: So I think most people would be okay paying a 444 00:23:08,200 --> 00:23:10,199 Speaker 1: little bit higher prices, but seeing the value of all 445 00:23:10,200 --> 00:23:12,679 Speaker 1: the things go up, then to lose everything, lose their 446 00:23:12,680 --> 00:23:14,680 Speaker 1: business and lose their job, and so I think, and 447 00:23:15,000 --> 00:23:18,320 Speaker 1: then that's the government's trying to keep us, as we 448 00:23:18,440 --> 00:23:21,320 Speaker 1: the people happy, complacent. But if you think about it 449 00:23:21,320 --> 00:23:24,760 Speaker 1: from a government perspective as well, if they have a 450 00:23:25,040 --> 00:23:28,080 Speaker 1: recession and then we go into some sort of deflation, 451 00:23:28,680 --> 00:23:31,080 Speaker 1: that could be the end of the governments as we 452 00:23:31,119 --> 00:23:33,639 Speaker 1: know it, right because all the debt is collateralized, and 453 00:23:33,680 --> 00:23:36,400 Speaker 1: so then it starts to unwind this debt bubble. I'm 454 00:23:36,400 --> 00:23:37,520 Speaker 1: not going to go through all that right now, I've 455 00:23:37,520 --> 00:23:41,080 Speaker 1: talked about it extensively. But if they're forced to choose 456 00:23:41,480 --> 00:23:43,800 Speaker 1: between the people, do we want to give them inflation 457 00:23:43,840 --> 00:23:46,200 Speaker 1: to deflation? But if they're forced to choose for themselves, 458 00:23:46,640 --> 00:23:48,800 Speaker 1: do we allow deflation and everything just to fall apart 459 00:23:48,800 --> 00:23:50,680 Speaker 1: and we go bankrupt? Or do we continue to print 460 00:23:50,720 --> 00:23:52,399 Speaker 1: money to pay our debts? Of course, they're going to 461 00:23:52,400 --> 00:23:56,360 Speaker 1: continue to print money every single time. All right, Now, 462 00:23:56,440 --> 00:23:59,040 Speaker 1: here's what I want to talk about though. So we're 463 00:23:59,040 --> 00:24:03,400 Speaker 1: going into recessions. So what so what? Well, I've already said, 464 00:24:03,400 --> 00:24:05,520 Speaker 1: so what maybe your job? So think about your job 465 00:24:05,600 --> 00:24:07,720 Speaker 1: or your business. Are you like in a recession proof 466 00:24:07,760 --> 00:24:11,119 Speaker 1: business or job or are you more at risk from that? 467 00:24:11,200 --> 00:24:12,679 Speaker 1: So that's one way you need to think about that. 468 00:24:12,960 --> 00:24:17,280 Speaker 1: But now let's talk about our money, our assets. So, 469 00:24:17,440 --> 00:24:19,600 Speaker 1: as I said, in twenty twenty, things really changed. We 470 00:24:19,680 --> 00:24:23,480 Speaker 1: saw first and foremost that no longer do the economy, 471 00:24:24,080 --> 00:24:26,960 Speaker 1: no longer does the economy equal to markets. As I said, 472 00:24:26,960 --> 00:24:29,720 Speaker 1: we saw the entire economies of the world literally shut 473 00:24:29,760 --> 00:24:31,720 Speaker 1: off with a light switch, and yet markets went to 474 00:24:31,760 --> 00:24:34,760 Speaker 1: new all time highs Now, was that an anomaly in 475 00:24:34,800 --> 00:24:38,280 Speaker 1: the COVID era or is that the way things are 476 00:24:38,440 --> 00:24:41,280 Speaker 1: now today? And is that the way things are going well, 477 00:24:41,359 --> 00:24:43,159 Speaker 1: maybe some of both. As a matter of fact, what 478 00:24:43,240 --> 00:24:47,399 Speaker 1: we can see is that the UK and Japan show 479 00:24:47,520 --> 00:24:52,480 Speaker 1: that markets are going up, not down after technical recessions. 480 00:24:52,560 --> 00:24:56,879 Speaker 1: Very interesting. So we have the UK and Japan are 481 00:24:56,880 --> 00:25:01,280 Speaker 1: slipping into technical recessions with their GDP releases. It's an 482 00:25:01,320 --> 00:25:05,240 Speaker 1: opportune moment to underscore that while such developments may generate 483 00:25:05,240 --> 00:25:09,000 Speaker 1: a lot of headlines, they have no forward looking information 484 00:25:09,240 --> 00:25:12,520 Speaker 1: content for investors. That's a key piece. They have no 485 00:25:12,800 --> 00:25:16,640 Speaker 1: forward looking information. You see, markets are what we call 486 00:25:17,840 --> 00:25:21,440 Speaker 1: future discounting. We're basically trying to buy something cheaper today 487 00:25:21,480 --> 00:25:24,159 Speaker 1: than it's worth in the future. So we're not buying 488 00:25:24,200 --> 00:25:26,240 Speaker 1: something for how much it's worth today. We're buying for 489 00:25:26,320 --> 00:25:28,320 Speaker 1: something for how much we think it will be worth 490 00:25:28,400 --> 00:25:30,760 Speaker 1: in the future. So we have to be forward looking. 491 00:25:31,320 --> 00:25:34,040 Speaker 1: And what happens is some of these data we have 492 00:25:34,160 --> 00:25:37,000 Speaker 1: lagging indicators, we have leading indicators. So GDP is a 493 00:25:37,080 --> 00:25:40,800 Speaker 1: lagging indicator. GDP tells us what happened in the past, 494 00:25:40,920 --> 00:25:43,439 Speaker 1: but we're trying to guess on where things will be 495 00:25:43,600 --> 00:25:46,399 Speaker 1: in the future. And so what they're saying here is 496 00:25:46,440 --> 00:25:51,480 Speaker 1: these GDP releases they have no forward looking information. For US, 497 00:25:52,840 --> 00:25:59,480 Speaker 1: technical recessions typically precede rising asset returns. It's pretty weird. 498 00:26:00,440 --> 00:26:04,480 Speaker 1: It's the opposite of what most people think. But as 499 00:26:04,520 --> 00:26:06,680 Speaker 1: we can see both of these countries going into recessions, 500 00:26:06,920 --> 00:26:09,240 Speaker 1: we can see this playing out in real time. Why 501 00:26:09,320 --> 00:26:12,320 Speaker 1: is this the case, Well, there's two main problems with 502 00:26:12,320 --> 00:26:15,120 Speaker 1: this categorization. One, when we look at just the recession 503 00:26:15,119 --> 00:26:19,560 Speaker 1: and the GDP, it's overly simplistic. Okay, when we look 504 00:26:19,560 --> 00:26:21,080 Speaker 1: at like Japan, like I said, it was like zero 505 00:26:21,080 --> 00:26:23,560 Speaker 1: point one percent two percent, there's little to no difference 506 00:26:23,600 --> 00:26:27,400 Speaker 1: between an economy that contracts it zero percent zero point 507 00:26:27,440 --> 00:26:31,200 Speaker 1: two percent one quarter and is flat the next, which 508 00:26:31,200 --> 00:26:34,680 Speaker 1: would be no recession, or one that sees growth fall 509 00:26:34,800 --> 00:26:37,560 Speaker 1: by zero point one percent for two quarters in a row, 510 00:26:37,600 --> 00:26:40,200 Speaker 1: which would be a recession. You see what I'm saying, 511 00:26:40,280 --> 00:26:43,320 Speaker 1: So technically a technical recession, what's the difference if I 512 00:26:43,320 --> 00:26:45,520 Speaker 1: get zero point two percent one year and one quarter 513 00:26:45,520 --> 00:26:48,719 Speaker 1: in the next quarter, it's flat or zero point one 514 00:26:48,760 --> 00:26:52,200 Speaker 1: percent both, Right, So that's what I'm talking about, overly simplistic. 515 00:26:52,200 --> 00:26:53,880 Speaker 1: Second of all, which is why probably why the Biden 516 00:26:53,880 --> 00:26:56,560 Speaker 1: administration said that's not technically the recession. We need to 517 00:26:56,560 --> 00:26:58,720 Speaker 1: look at more data than them. Second is because like 518 00:26:58,720 --> 00:27:02,560 Speaker 1: I said, GDP's a lagging indicator, is telling us where 519 00:27:02,560 --> 00:27:05,760 Speaker 1: the economy was, not where the economy is going. But 520 00:27:05,800 --> 00:27:09,800 Speaker 1: the markets are trying to predict the future. They're forward looking, 521 00:27:10,359 --> 00:27:12,679 Speaker 1: and so us as investors, we need to focus our 522 00:27:12,720 --> 00:27:16,000 Speaker 1: energies on leading indicators of the economy rather than GDP, 523 00:27:16,280 --> 00:27:19,639 Speaker 1: which is again a lagging indicator. Some information content can 524 00:27:19,680 --> 00:27:22,639 Speaker 1: be gained by gap by looking at by trying to 525 00:27:22,640 --> 00:27:25,600 Speaker 1: discern by gauging the composition of the growth, but there's 526 00:27:25,640 --> 00:27:27,880 Speaker 1: nothing in a GDP report that will give us any 527 00:27:27,880 --> 00:27:32,200 Speaker 1: indication of an approaching turning point when markets typically see 528 00:27:32,240 --> 00:27:35,800 Speaker 1: the biggest moves When it comes to the UK, leading 529 00:27:35,880 --> 00:27:39,359 Speaker 1: indicators are rising, So what are those. I'm going to 530 00:27:39,400 --> 00:27:40,560 Speaker 1: come back with those in a minute. If you're just 531 00:27:40,560 --> 00:27:42,760 Speaker 1: tune in your listening to the markmas Show, I'm going 532 00:27:42,800 --> 00:27:44,200 Speaker 1: to take a very quick break. When we come back, 533 00:27:44,200 --> 00:27:47,680 Speaker 1: we'll talk about the leading indicators that show it's rising. 534 00:27:47,840 --> 00:27:50,639 Speaker 1: Don't go away, I'll be right back, all right, Welcome back. 535 00:27:50,680 --> 00:27:52,080 Speaker 1: If you just tune in your listening to the Mark 536 00:27:52,160 --> 00:27:55,679 Speaker 1: Maas Show, We're talking about how the major economies of 537 00:27:55,720 --> 00:27:59,440 Speaker 1: the world are all slipping into recession. But yet surprise, surprise, 538 00:27:59,480 --> 00:28:03,440 Speaker 1: surprise is the markets are making highs, which is pretty interesting. 539 00:28:03,680 --> 00:28:07,159 Speaker 1: So we're talking about why looking at the GDP and 540 00:28:07,200 --> 00:28:09,520 Speaker 1: stuff are lagging indicators and it doesn't tell us what's 541 00:28:09,520 --> 00:28:11,840 Speaker 1: happened in the future. And so that's one of the 542 00:28:11,880 --> 00:28:14,719 Speaker 1: reasons why we see that it's going down but markets 543 00:28:14,720 --> 00:28:18,200 Speaker 1: are going up because it told us what already happened. 544 00:28:18,240 --> 00:28:20,879 Speaker 1: But the markets are telling us what is going to happen. 545 00:28:22,080 --> 00:28:25,440 Speaker 1: So better understand that we're trying to look forward leading indicators, 546 00:28:25,440 --> 00:28:27,600 Speaker 1: not lagging indicators, and when it comes to the UK, 547 00:28:28,000 --> 00:28:32,000 Speaker 1: leading indicators are rising, suggesting the worst could have already 548 00:28:32,240 --> 00:28:35,239 Speaker 1: passed for the economy. That's what people are saying. I mean, 549 00:28:35,240 --> 00:28:37,760 Speaker 1: that's what the market's telling us. Anyway, they're saying it's 550 00:28:37,760 --> 00:28:40,480 Speaker 1: already happened. It's similar same thing in Japan. The yen 551 00:28:40,720 --> 00:28:45,960 Speaker 1: and the JGB yields fall in the shorter term. Then 552 00:28:46,080 --> 00:28:48,160 Speaker 1: when that happens, the Nikki, which is their index, their 553 00:28:48,160 --> 00:28:50,840 Speaker 1: stock index, treads water in the short term after the 554 00:28:50,880 --> 00:28:54,440 Speaker 1: technical recession, but after twelve months it returns an average 555 00:28:54,440 --> 00:29:00,360 Speaker 1: of ten point seven percent. That's what we've seen. Good 556 00:29:00,560 --> 00:29:03,160 Speaker 1: now again back in the US, the US is nowhere 557 00:29:03,200 --> 00:29:07,240 Speaker 1: near a technical recession at the moment, but same we're 558 00:29:07,320 --> 00:29:11,680 Speaker 1: also the average mean positive returns after we can see 559 00:29:11,680 --> 00:29:16,920 Speaker 1: that after recession, we see that we see big returns 560 00:29:16,960 --> 00:29:20,520 Speaker 1: over the next three to twelve months historically, So what 561 00:29:20,560 --> 00:29:23,600 Speaker 1: we see is technical recessions generate a lot of heat, 562 00:29:23,840 --> 00:29:28,280 Speaker 1: but not much light. There are sometimes oftentimes most times 563 00:29:28,320 --> 00:29:30,680 Speaker 1: just a distraction for us and as investors. So we 564 00:29:30,680 --> 00:29:33,520 Speaker 1: can see again back to the United States, we had 565 00:29:33,600 --> 00:29:37,000 Speaker 1: a technical recession, then the Bide administration told us it wasn't. 566 00:29:37,120 --> 00:29:39,440 Speaker 1: But then market's rallied in one of the best years 567 00:29:39,440 --> 00:29:43,040 Speaker 1: that we've had in decades. And that's exactly what we're seeing. 568 00:29:43,080 --> 00:29:45,960 Speaker 1: And so the recession in the UK, the EU and 569 00:29:46,040 --> 00:29:49,840 Speaker 1: Japan could already be over because it's lagging. Indicators in 570 00:29:49,880 --> 00:29:54,640 Speaker 1: the markets are giving us those forward looking indicators. Now, 571 00:29:54,880 --> 00:29:56,360 Speaker 1: some of the things that we can pick up from 572 00:29:56,440 --> 00:30:00,480 Speaker 1: Japan is, like I said, because it's forward looking, it 573 00:30:00,600 --> 00:30:02,520 Speaker 1: sort of tells us what's going to happen. And so 574 00:30:03,800 --> 00:30:06,880 Speaker 1: Japan had been wanting to and the ECB and the 575 00:30:06,920 --> 00:30:10,600 Speaker 1: FED as well been wanting to again fighting inflation, wanted 576 00:30:10,640 --> 00:30:13,200 Speaker 1: to raise rates. Japan specifically wanted to get out of 577 00:30:13,240 --> 00:30:17,720 Speaker 1: this negative interest rate policies they've had. But going into 578 00:30:17,720 --> 00:30:22,040 Speaker 1: the recession right now, EU, UK, JGB, potentially the US 579 00:30:23,040 --> 00:30:25,800 Speaker 1: going to that recession shows us that there's no way 580 00:30:25,840 --> 00:30:28,560 Speaker 1: they can tighten that market back up, and most of 581 00:30:28,560 --> 00:30:30,760 Speaker 1: these countries ecb US, etcetera are going to have to 582 00:30:30,760 --> 00:30:33,719 Speaker 1: start easing, and that's what the markets are picking up on. 583 00:30:33,760 --> 00:30:35,920 Speaker 1: You See, you have to understand the causal, the cause 584 00:30:35,960 --> 00:30:39,360 Speaker 1: and effect mechanism here. If we go into recession, then 585 00:30:39,480 --> 00:30:42,400 Speaker 1: the Feds will ease, and so what the markets are saying, well, okay, 586 00:30:42,440 --> 00:30:45,040 Speaker 1: we get the recession, but that's what happened last quarter. 587 00:30:46,080 --> 00:30:48,800 Speaker 1: Now we understand because of that the central banks will 588 00:30:48,800 --> 00:30:51,760 Speaker 1: have to ease, and so we now expect an expansion. 589 00:30:51,840 --> 00:30:55,040 Speaker 1: So we're going to bid the stocks up, right, That's 590 00:30:55,080 --> 00:30:57,200 Speaker 1: what we're talking about. So, like back to Japan, the 591 00:30:57,280 --> 00:31:01,520 Speaker 1: Nikkei Index more than doubled from the COVID lows and 592 00:31:01,560 --> 00:31:04,760 Speaker 1: it's about to breach its all time bubble highs that 593 00:31:04,880 --> 00:31:09,080 Speaker 1: were set in the back in nineteen eighty nine. So 594 00:31:09,160 --> 00:31:11,320 Speaker 1: the Nikki index is making a new high that hasn't 595 00:31:11,360 --> 00:31:16,280 Speaker 1: been set for multiple decades, and it's right after Japan 596 00:31:16,440 --> 00:31:20,480 Speaker 1: technically entered a recession. You see what we're talking about here. 597 00:31:21,040 --> 00:31:24,200 Speaker 1: So the recession happened, but what's happening next? The markets 598 00:31:24,240 --> 00:31:26,000 Speaker 1: are trying to tell us, at least what they think. 599 00:31:26,160 --> 00:31:29,000 Speaker 1: Now it's anybody's guests. None of us have a crystal ball. 600 00:31:29,400 --> 00:31:31,320 Speaker 1: But people are putting their money where their mouth is, 601 00:31:31,320 --> 00:31:33,480 Speaker 1: so to speak. And that's exactly what the markets are saying. 602 00:31:34,840 --> 00:31:38,400 Speaker 1: And so it's confirming that only central banks matter in 603 00:31:38,480 --> 00:31:43,680 Speaker 1: a world where the economy clearly does not. Back to 604 00:31:43,720 --> 00:31:47,360 Speaker 1: twenty twenty, the entire economy was turned off like a 605 00:31:47,440 --> 00:31:52,040 Speaker 1: light switch all across the globe simultaneously. At the same time, 606 00:31:53,480 --> 00:31:57,360 Speaker 1: the economy, the jobs, the businesses, but yet the markets 607 00:31:57,680 --> 00:32:00,080 Speaker 1: screamed to all new time highs. And so what that 608 00:32:00,160 --> 00:32:05,600 Speaker 1: means is that the money printers override real businesses. Now, 609 00:32:05,640 --> 00:32:09,000 Speaker 1: this is fake, it's artificial, it's non sustainable, and it 610 00:32:09,040 --> 00:32:13,360 Speaker 1: only leads to paying death and destruction eventually. But for now, 611 00:32:13,400 --> 00:32:15,080 Speaker 1: in the short term, this is what matters, which is 612 00:32:15,080 --> 00:32:18,920 Speaker 1: why we focus on the central bank policy. We focus 613 00:32:19,000 --> 00:32:21,560 Speaker 1: on are their policies going to be tight, are they 614 00:32:21,560 --> 00:32:23,320 Speaker 1: going to be loose? What will they do? And we 615 00:32:23,360 --> 00:32:26,640 Speaker 1: try to understand the leading indicators that show us what 616 00:32:26,800 --> 00:32:30,920 Speaker 1: they'll have to do. So, for example, this is exactly 617 00:32:30,960 --> 00:32:33,560 Speaker 1: what we're talking about. The central banks say they want 618 00:32:33,560 --> 00:32:36,120 Speaker 1: to tighten, but given the fact that economies are going 619 00:32:36,120 --> 00:32:39,000 Speaker 1: into recession, they can't, and so we can start to 620 00:32:39,080 --> 00:32:41,120 Speaker 1: front run them. We can start to guess where they're 621 00:32:41,120 --> 00:32:43,560 Speaker 1: going to go based off of understanding these natural constraints, 622 00:32:43,760 --> 00:32:46,160 Speaker 1: and rather than trying to spend all our time focusing 623 00:32:46,240 --> 00:32:50,080 Speaker 1: on what the economy is doing, really what we're understanding 624 00:32:50,160 --> 00:32:53,400 Speaker 1: is it's the central banks that matter the most. That 625 00:32:53,440 --> 00:32:58,000 Speaker 1: makes sense. It's why I talked about probably the greatest 626 00:32:58,040 --> 00:33:00,600 Speaker 1: investor in I don't want to say he's the greatest, 627 00:33:01,200 --> 00:33:03,680 Speaker 1: he's one of the greatest investors in history. I don't know, 628 00:33:03,720 --> 00:33:06,440 Speaker 1: I don't I don't know totally. But he went forty 629 00:33:06,560 --> 00:33:10,480 Speaker 1: years without a loss in a twenty billion dollar portfolio, 630 00:33:10,640 --> 00:33:13,240 Speaker 1: forty years without a loss and averaged a thirty percent return. 631 00:33:14,240 --> 00:33:17,040 Speaker 1: Arguably one of the greatest ever. Talking about Stanley drucken Miller, 632 00:33:18,120 --> 00:33:21,000 Speaker 1: he worked under George Soros, and I mean, he's just 633 00:33:21,040 --> 00:33:24,800 Speaker 1: a legend. But what we saw is that there there 634 00:33:24,840 --> 00:33:27,760 Speaker 1: was a book written New Money Wizards, New Market Wizards, 635 00:33:28,240 --> 00:33:30,760 Speaker 1: and he talked about how when he first started his career, 636 00:33:31,560 --> 00:33:35,560 Speaker 1: he win did all this research into these stocks and 637 00:33:35,600 --> 00:33:38,600 Speaker 1: these companies and looked at all the fundamental analysis and 638 00:33:38,720 --> 00:33:41,440 Speaker 1: looked at, you know, the earnings and the profits and 639 00:33:41,440 --> 00:33:42,840 Speaker 1: all these things, and he took it to the fund 640 00:33:42,880 --> 00:33:44,880 Speaker 1: manager and they said, this is this is all garbage's 641 00:33:44,880 --> 00:33:48,320 Speaker 1: none of this matters to us. And he's like, what 642 00:33:48,320 --> 00:33:49,840 Speaker 1: what do you mean None of this matters? He said, 643 00:33:49,960 --> 00:33:53,000 Speaker 1: go find out the real thing that drives prices up 644 00:33:53,040 --> 00:33:55,880 Speaker 1: and down. And Stanley Druckon Miller was kind of confused. 645 00:33:55,920 --> 00:33:58,160 Speaker 1: He said, what do you mean, go find out the 646 00:33:58,200 --> 00:34:00,920 Speaker 1: real thing? I thought I did, So he went back 647 00:34:00,960 --> 00:34:03,640 Speaker 1: to the drawing board and what he concluded was that 648 00:34:03,760 --> 00:34:09,040 Speaker 1: none of those fundamentals matter. What really matters is the liquidity. 649 00:34:09,880 --> 00:34:13,760 Speaker 1: That's what matters. And liquidity is supplied by the central banks. 650 00:34:13,880 --> 00:34:17,040 Speaker 1: They're the ones that change the price of money, they're 651 00:34:17,080 --> 00:34:20,279 Speaker 1: the ones that add money whatever. And so it's basically 652 00:34:20,600 --> 00:34:23,120 Speaker 1: what led to his success for thirty or forty years. 653 00:34:23,440 --> 00:34:25,359 Speaker 1: And it's the same playbook that we can and we're 654 00:34:25,400 --> 00:34:29,160 Speaker 1: seeing it front and foremost right here Japan, EU, UK 655 00:34:29,600 --> 00:34:33,840 Speaker 1: and now potentially the US slipping into recession. Wall markets 656 00:34:33,840 --> 00:34:36,960 Speaker 1: are screaming to new all time highs. It's pretty incredible. 657 00:34:38,080 --> 00:34:39,920 Speaker 1: And again we're seeing it in the US as well. 658 00:34:39,960 --> 00:34:42,560 Speaker 1: Now the US is not technically in a recession, but 659 00:34:42,680 --> 00:34:45,440 Speaker 1: growth has slowed way down, and everyone's afraid that we're 660 00:34:45,440 --> 00:34:48,040 Speaker 1: going to go into recession any moment. But we can 661 00:34:48,080 --> 00:34:51,120 Speaker 1: see that Wall Street is at its highest level ever, 662 00:34:51,200 --> 00:34:55,360 Speaker 1: the S and P five hundreds breaking new levels. We 663 00:34:55,440 --> 00:34:59,640 Speaker 1: see that we have higher retail sales and markets are 664 00:34:59,640 --> 00:35:02,640 Speaker 1: going up. US stocks closed higher on Thursday as retail 665 00:35:02,640 --> 00:35:06,520 Speaker 1: sales data declined more than expected. So the sales data 666 00:35:06,600 --> 00:35:09,560 Speaker 1: went down, meaning the economy is not doing good, meaning 667 00:35:09,560 --> 00:35:15,200 Speaker 1: we could be slipping into recession, but stocks went up. Huh, 668 00:35:15,280 --> 00:35:18,359 Speaker 1: how does that work? Wait, so sales the business went down, 669 00:35:18,400 --> 00:35:21,800 Speaker 1: but the stocks went up. Are you starting to understand? 670 00:35:22,160 --> 00:35:25,400 Speaker 1: Are you starting to understand why? Well, because then we 671 00:35:25,520 --> 00:35:28,200 Speaker 1: understand what comes next. If retail sales go down, that 672 00:35:28,239 --> 00:35:30,760 Speaker 1: means the economy is slowing down. That means the recession 673 00:35:30,800 --> 00:35:34,239 Speaker 1: is coming. If that happens, then what you have to 674 00:35:34,239 --> 00:35:37,160 Speaker 1: ask yourself, second, third, fourth, fifth order? Then what well? 675 00:35:37,200 --> 00:35:40,799 Speaker 1: Then the Federal Reserve will start cutting interest rates in 676 00:35:40,880 --> 00:35:44,160 Speaker 1: coming months. You see, and this is what stocks are 677 00:35:44,160 --> 00:35:47,120 Speaker 1: starting to price for a Commerce Department report showed US 678 00:35:47,120 --> 00:35:51,560 Speaker 1: retail sales dropped zero point eight percent in January, so 679 00:35:52,040 --> 00:35:55,680 Speaker 1: you know things are slowing down pretty bad. Investors are 680 00:35:55,760 --> 00:35:58,160 Speaker 1: cheering the fact that we got a weaker than anticipated 681 00:35:58,280 --> 00:36:02,560 Speaker 1: retail report. When our investors cheering that, why do they 682 00:36:02,600 --> 00:36:05,239 Speaker 1: want a weaker than anticipated retail report? Well, because if 683 00:36:05,280 --> 00:36:08,279 Speaker 1: the retail port was stronger than anticipated, then the FED 684 00:36:08,320 --> 00:36:12,520 Speaker 1: would push off the pivot, they'd push off the rate decreases. 685 00:36:12,719 --> 00:36:15,600 Speaker 1: But because it was weaker than expected, the investors are 686 00:36:15,640 --> 00:36:19,200 Speaker 1: cheering it because they want that to come. It says, 687 00:36:19,400 --> 00:36:22,160 Speaker 1: it shows that maybe the economy might be a little weak, 688 00:36:22,400 --> 00:36:25,480 Speaker 1: and so that's sort of bad news. That's potentially good news, 689 00:36:26,440 --> 00:36:29,240 Speaker 1: good news, bad news. It's good it's it's bad news 690 00:36:29,239 --> 00:36:31,120 Speaker 1: that the economy is getting weak, but it's good news 691 00:36:31,160 --> 00:36:34,200 Speaker 1: because it means the FED is more likely to cut rates, 692 00:36:34,360 --> 00:36:38,640 Speaker 1: said Thomas Martin, senior portfolio manager at Globalt. So this 693 00:36:38,840 --> 00:36:41,200 Speaker 1: is this is where we're at. You have to understand 694 00:36:41,280 --> 00:36:43,759 Speaker 1: what is the problem I'm afraid of? What am I 695 00:36:43,800 --> 00:36:47,680 Speaker 1: trying to protect myself from in a recession? Is my job? 696 00:36:47,880 --> 00:36:49,759 Speaker 1: Is my business at risk? What can I do to 697 00:36:49,760 --> 00:36:52,200 Speaker 1: shore that up, and then what should I expect with 698 00:36:52,239 --> 00:36:55,040 Speaker 1: my investments? To understand those are two separate things that 699 00:36:55,120 --> 00:36:59,640 Speaker 1: have to be addressed and managed separately. I know this 700 00:36:59,760 --> 00:37:01,799 Speaker 1: is we I know this is a new world. But 701 00:37:01,880 --> 00:37:05,200 Speaker 1: as Einstein said, the answers have changed. The way the 702 00:37:05,239 --> 00:37:08,520 Speaker 1: central banks and the politicians and the governments interact in 703 00:37:08,520 --> 00:37:11,160 Speaker 1: the markets changed in two thousand and eight, it changed 704 00:37:11,160 --> 00:37:13,600 Speaker 1: again in twenty twenty, and we are a new paradigm. 705 00:37:13,840 --> 00:37:15,200 Speaker 1: If you're just tuning in your listening to the Mark 706 00:37:15,239 --> 00:37:17,640 Speaker 1: Maus Show, talking about the way the world is changing 707 00:37:17,680 --> 00:37:20,399 Speaker 1: as we look at through lens of politics, finance, and technology. 708 00:37:20,840 --> 00:37:22,600 Speaker 1: And that's what I got for today. That's a wrap. 709 00:37:22,600 --> 00:37:23,560 Speaker 1: Thanks so much for listening.