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Speaker 1: Let's get to our guests. Fenn Hendrick is with us.

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Speaker 1: He as founder at Northman Trader. He joins from London,

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Speaker 1: where it's got to be late in the evening approaching. Well,

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Speaker 1: I think it's already Friday morning, right midnight, Spen, thanks

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Speaker 1: for being with us. We're looking at the GDP number

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Speaker 1: now much worse than forecast in the US, and so

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Speaker 1: as a result of this print, the markets are really

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Speaker 1: forced to dial back expectations for FED rate hikes. Is

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Speaker 1: that the right move now, because there's not any evidence

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Speaker 1: yet that the labor market has softened. Hi, good evening,

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Speaker 1: got to be with you. Look, it's yeah, it's it's

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Speaker 1: actually the cure ultimately for inflation is to have a recession.

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Speaker 1: It's not something that obviously the FIT or anyone else

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Speaker 1: wants to publicly push. But that was the examples that

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Speaker 1: we saw in two and we didn't have very high inflation,

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Speaker 1: then a recession came about, and guess what, the FIT

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Speaker 1: cut rates inside the recession while inflation was still high.

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Speaker 1: So yes, is certainly with the drastic slowdown that we've

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Speaker 1: seen in recent months, that is the concern obviously that

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Speaker 1: we can slip into a recession. And the today's GDP

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Speaker 1: numbers certainly raised that specter as slow growth has dramatically

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Speaker 1: slowed down. How should just add one point? Ironically, if

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Speaker 1: you look at past the last fifty seventy years, every

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Speaker 1: time US GDP has printed two consecutive negative growth periods,

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Speaker 1: it ended up being classified as a recession. So this

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Speaker 1: here would be very much an exception. If that was

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Speaker 1: not the case, well, we did have equities rising again

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Speaker 1: in the US. Do you buy into this good news

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Speaker 1: as bad news narrative? Though it doesn't seem terribly likely

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Speaker 1: the fid's going to blink on the basis of two

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Speaker 1: quarters of contraction. Now they shouldn't blink at this point.

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Speaker 1: But I think J. Powe made it clear yesterday that

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Speaker 1: forward guidance suddenly is suspended, and he said that you know,

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Speaker 1: who knows where rates are going to be six months

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Speaker 1: from now, which is a good counter to the fit's

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Speaker 1: own FED fund forecast for next year, which is three

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Speaker 1: point eight percent. So that was an interesting pivot, and

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Speaker 1: obviously markets reacted strongly off of that. The issue is

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Speaker 1: simply is can inflation be really contained here in the

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Speaker 1: next few months. I mean, obviously we're all looking for

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Speaker 1: some sort of relief on that front, and there's a

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Speaker 1: number of data points that may point to that. The promise,

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Speaker 1: the areas of inflation that the FIT does not control

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Speaker 1: cannot control, and the food, energy and what have you.

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Speaker 1: To the extent there, there's still more persistent than any

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Speaker 1: early pivot of the FIT may end up being a

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Speaker 1: polymus policy mistake down the road. That's the danger here.

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Speaker 1: And of course equities are pivoting of what's been happening

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Speaker 1: with yales, which have been dropping dramatically since the June

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Speaker 1: peak of three and a half percent, and also in

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Speaker 1: the reversal in the dollar group. Remember in June we

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Speaker 1: were extremely oversold and technically disconnected. So for now we

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Speaker 1: can view all this maybe in context of a larger

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Speaker 1: bear market rally, and we've seen those in your two thousand,

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Speaker 1: two thousand and eight and they ultimately ended up turning

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Speaker 1: after everybody gets very optimistic again. And Spain, I just

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Speaker 1: want to talk about a couple of the big earnings

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Speaker 1: announcements we had today. Let's talk about Apple. It was

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Speaker 1: a narrow beat really, but we're seeing a personal consumption

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Speaker 1: in the US easing as as consumers tighten belts. Supply

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Speaker 1: and chain issues continue to buy. What are your expectations

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Speaker 1: around Apple? Is it a buy at the moment? Well, actually, Apple,

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Speaker 1: just before close today was getting very close to its

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Speaker 1: two hundred day moving average, which is significantly better than

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Speaker 1: what we've seen obviously with the overall market. So I'm

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Speaker 1: gonna watch this closely tomorrow if this actually sustains a

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Speaker 1: move above the two hundred day moving average, because once

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Speaker 1: you break these big moving averages, they tend to be

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Speaker 1: resistance on the way up. So from my perspective, I

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Speaker 1: want to see if that actually can't sustain. If it

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Speaker 1: can sustain above and back tested and hold it, then

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Speaker 1: I think this will be still bullish for Apple for

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Speaker 1: a while. But if it cannot, and I think we

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Speaker 1: should expect wholly a sizeable reach ray still. So I

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Speaker 1: was reading something where Tim Cook, the CEO of Apple,

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Speaker 1: was saying the company will continue to hire employees, but

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Speaker 1: in a very deliberate way. There had been reports earlier

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Speaker 1: that Apple had planning to slow down the pace of hiring.

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Speaker 1: And that's kind of a segue into a point that

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Speaker 1: I want to do address, which was the employment cost

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Speaker 1: index data that we'll get tomorrow in the US. Are

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Speaker 1: you thinking that we are going to get a lot

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Speaker 1: of inflationary pressure when it comes to kind of the

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Speaker 1: labor market, whether it's wages or other costs associated with

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Speaker 1: hiring employees. Well, from my perspective, a lot of these

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Speaker 1: indicators are still lagging in terms of what we're actually

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Speaker 1: seeing vius of you to slow down in the economy.

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Speaker 1: Uh that that's going to be a tough one to

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Speaker 1: to negotiate through over the next few months. The market

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Speaker 1: needs to see a definite sort of points of evidence

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Speaker 1: that inflation is still slowing down so that it actually

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Speaker 1: can sustain the expectation that the Fed is going to

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Speaker 1: radically slow down the rates. And on that point, I

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Speaker 1: just want to highlight this. We have in a period

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Speaker 1: now that the set has raised rates to the same

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Speaker 1: level it got two in two thousand and eighteen and

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Speaker 1: was lights out then, and since then we've added nine

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Speaker 1: trillion dollars in debt. So the notion that the economy

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Speaker 1: itself and markets can sustain higher rates of this level

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Speaker 1: for an extended period of time, in my view, is

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Speaker 1: incompatible with the notion that there's not going to be

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Speaker 1: a recession. So this this still has to negotiate itself

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Speaker 1: out and to the extent that the economy does not

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Speaker 1: pick up here very short soon, then you know, the

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Speaker 1: risk is that these pauses in employment announcements are basically

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Speaker 1: rolling over and will result them in actually sizeable layoffs

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Speaker 1: to come and into next year. We've seen the bloom

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Speaker 1: Big Dollar spot index just grinding lower over the past

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Speaker 1: couple of weeks. Do you do you think we've hit

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Speaker 1: peaked dollar now? Well, interesting enough. Lambunist dollar obviously is

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Speaker 1: the fundamental component to do it, but there's also the

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Speaker 1: technical and the chart on the monthly dollar has been

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Speaker 1: incredibly clean from a technical perspective. There's an upper trend

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Speaker 1: line and it hit it perfectly in July and then reverse.

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Speaker 1: And part of what helped the reversal was the fact

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Speaker 1: that there's maybe part of the fundamental aspect here of it,

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Speaker 1: because there's all a large game of relativity between central banks.

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Speaker 1: The ECB in Europe was even more horrifically late to

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Speaker 1: the party of actually raising rates. They just raised the

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Speaker 1: rates for the first time in eleven years and it's

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Speaker 1: still at zero, and so that they finally got off

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Speaker 1: that train that helped reverse the dollar a little bit

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Speaker 1: as well. So to the extent that the ECB continues

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Speaker 1: to become at least more aggressive in the short term,

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Speaker 1: that can help the dollar or relieve the more pressure

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Speaker 1: on the dollar, And we had this inverse correlation between

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Speaker 1: the dollar and the SUP So for equities to continue

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Speaker 1: to rally, we need to continue to see the dollar reverse. Technically,

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Speaker 1: my view is that it has potential to reverse some more.

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Speaker 1: But I guess this is a chart that everybody needs

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Speaker 1: to watch very closely. So Spen, we've laid out a

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Speaker 1: pretty tricky landscape. Here, give me thirty seconds on how

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Speaker 1: you want to approach putting money to work in this environment. Well, frankly,

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Speaker 1: you know we've laid out of a bear market rally

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Speaker 1: case in June that goes along with two thousand, two

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Speaker 1: thousand and eight, where you can get a major technical

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Speaker 1: reconnect on that basis what we're seeing right now with

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Speaker 1: breakouts and equities. Uh, in terms of the down trends,

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Speaker 1: you have room to the upside still, but you've gotta

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Speaker 1: be also, from our perspective, got to be very aware

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Speaker 1: of the signals as we are approaching resistance. So I

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Speaker 1: don't think there's anything that a straight line is in

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Speaker 1: my view, now we're getting to the point, now into

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Speaker 1: forty one, Van Henrick were out of times. Van Henrick

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Speaker 1: is founder at Northman Trader. This is blam back