We are IN Recession NOW | Sell Before it's Too Late.

Another day, another hedge fund manager

telling you to raise cash that we're at

the top of the market bubble and it is a

time to be prepared for a guaranteed

recession. Now, this individual, Ed

Dodd, interviewed on the Julia LRO show,

which I'm pretty sure she's a CNBC

analyst like Sarah Eisen, which it seems

like CNBC is starting to really promote

the whole podcast scene. Uh, but they

don't really brand it CNBC. Kind of kind

of interesting how they do this and I'd

love to find out details on that. But

anyway, uh, what's going on here is

you've got somebody tossing some bear

poop and I think we should listen to it

to see if he has a point. So, I've gone

ahead and cut the most critical

components in my opinion and we'll react

to it. Let's listen in. First, we'll

talk where we'll start where he talks

about how we're in the stock market

mania right now. Let's get into it. You

know, it's being driven by seven stocks

that are 40% of the S&P market cap right

now. It's the AI stocks and we are at a

feeding frenzy of AI circular. They call

it the cir the circle jerk of financing.

There's no there there's no money to

fund all this. This is the problem. They

there they want trillions of dollars,

but their revenues aren't there. The ROI

is not there. And the markets are

starting to figure this out. And that's

why they're doing all these circular

deals to keep their uh their you know I

guess the momentum of hype going. And

then yesterday or the day before Sam

Alman and and and Jensen at the same

time said two things. They wanted uh

Jensen said China's going to win and

Alman said we need a government back

stop basically and then he denied it.

Then it came out that two weeks ago in a

memo they asked for a government back

stop. Okay, both of these people, just

to add clarity here, denied uh the their

their original comments. So, you had

Jensen who walked back the China is

going to win comments after it sounded

like the Trump administration got

pissed. Mind you, we have Nvidia

earnings this week, so it should be

quite entertaining. Uh those along with

jobs data for September and the new uh

ADP weekly report. Uh we'll get the EDP

weekly report today and then uh sorry

tomorrow and then of course later this

week we'll go ahead and get the other

data. But Jensen walked this back after

I believe the Trump administration was

pretty disappointed in Jeden. Uh and

then Jensen said don't worry you know

the United States we are still

substantially ahead but he was really

planting the seed for dude stop like we

need to we need to go all in here on

supporting the chip industry which was

interesting. Uh I think part of it is

because Jensen really wants chip sales

to China. The problem is you just had

companies like uh Amazon blocking or

supporting the blocking of Nvidia chip

sales to China mostly because there was

also reporting that Alibaba is

potentially utilizing artificial

intelligence to help the Chinese

military potentially against uh the

United States. And you know that that'll

piss the United States and White House

off. But yeah, take a look at this.

Amazon and Microsoft back effort to curb

Nvidia exports to China. Uh so you could

this tension has been very real and this

is one of the reasons why Jensen's like,

"Hey, if we sell China our chips, then

they're relying on us. Come on, let us

sell chips." Jensen wants the revenue.

He's about to tell us that they're

expecting a tr, you know, half a

trillion dollars of revenue uh in this

next earnings call. It should be a

phenomenal earnings call. Of course, how

the market reacts is a totally different

story. And then of course, yes, Sam

Alman essentially did ask for a

government back stop, then came out and

denied it. The CFO asked during an

interview. Then they denied it. Sam

Alman walked back her comments. No, no,

no, no. We, you know, we're just saying

like, hey, things would go faster if if

the whole industry was supported. Uh,

and then of course a White House memo

comes out which says, "No, yeah, we

basically have been exactly asking for a

government back stop because it would

make financing cheaper." which making

financing cheaper is exactly what people

are worried about today because you even

had Jeffrey Gunlock just this morning

come out and say raise 20% cash because

the private credit bubble is a ticking

time bomb and there's a reason credit

default swaps are going up because

credit risk is starting to be realized

as being very very dangerous.

Well, here we are. [laughter] Uh, now

you've got Nvidia asking for help from

the government and open AAI. And in

other words, Ed here is saying

>> they want

>> that's a bad sign. Well, we'll see.

>> They want government guarantees. So,

that signals to the market a couple

things. What does that signal? That

signals that the financing of this uh

this bubble is coming to an end. We're

starting to see it in CDS spreads,

credit default swaps. Coreweave is

exploding up. Oracle is exploding up.

And so the financing is getting tight

because the mark the credit markets are

starting to tighten.

>> Keep in mind some of that increase in

CDS's, those spreads could be hedging,

you know, and it's sort of it's I mean

that's what CDS's are, right? It's

taking out an insurance policy. So some

people are like, you know, a lot of

people are still very long these names.

Maybe it's just hedging. Who knows? Or

it's the start of something

>> in in general because there's economic

woes. We saw some uh subprime auto

companies go bust. So the credit markets

are tightening and so the finance

>> that wasricolor first brand

>> thing for this whole this whole um you

know I guess momentum AI hype is coming

to an end and Jensen and Altman told you

that because they want a government

bailout at all-time highs on Nvidia

stock. I wouldn't go as far as calling

it a bailout, but I do think that Jensen

wants the government license to go sell

more to kind of keep the cycle going.

And I do think that Sam Alban absolutely

believes that if the government backs

stopped the underlying chip values, then

you could finance into infinity. But now

you completely remove the market

weighing any kind of risk and you

actually create guaranteed excess. We

probably already have excess, you know,

we probably already way too euphoric,

but that just guarantees it because you

basically license excess. It's always

the rich that get bailed out by the

government, isn't it?

>> So, this this is this is a signal that

demand is rolling over and financing is

getting difficult. So, the end days are

near. I suspect the Trump administration

>> the end days are here. My gosh.

>> Will, you know, take equity stakes or do

something. Uh, today it came out.

They're trying to figure out they denied

it yesterday. David Sachs denied it. Uh

but then today we're seeing PY uh

talking about using Fanny and Freddy to

take stakes in in in these companies.

This is madness. They're buying at the

top and once they do this, I suspect

those stocks will have one more pump and

then it's over. So,

>> hey, that sounds bullish. One more pump.

[laughter] The euphoric end to the Nike

smoosh. I don't know. Some would say we

already hit the euphoric end. We're just

waiting for the the the uh the S&P 500

and the rest of the global indices to

roll over. They all have similar

characteristics. They're very narrow

markets and uh the stock market is kind

of hiding what's going on on the street

and what's going on in the street is a

disaster. And this is, you know, we

tried to tell the Trump administration

they should have us sit down with the

American people and say, "Look, there's

going to be a hangover from our policies

to get us to the golden age." They're

now declaring the golden age is here.

That's wrong. affordability is not

inflation is coming down, but it's not

coming down as fast.

>> Keep in mind, this guy voted for Trump.

And what he's really asking is for

Donald Trump to sit down to the American

people and go, "Look, we've got a

hangover here from all this crazy

illegal immigration that happened. We're

going to slow this down. We're going to

have some tariffs to try to

re-industrialize America. It's going to

put us through a recession, but it's

fixing what we needed to do." He makes

this argument. I'm summarizing that part

so we don't have to spend an hour

through it all, but and you could watch

it obviously yourself, but it's an

interesting argument that he makes. He's

like, "Hey, the president should be

honest with us." What do you think he

forgets is the psychology of that? The

president comes out and says that,

you'll immediately cause a dash for cash

and you'll literally induce the very

recession that ideally you would try to

avoid. You would remove any chance of

avoiding a recession if you did this. as

people would like. There's still health

care costs rising because of the co

debacle. Uh so we are we are at the

precipice of um this becoming apparent

to the masses. But you know if you look

at what the institution

>> aka stock market down is what he means

when he says apparent to the masses

>> are doing they're starting to slowly

reallocate to treasuries which is the

safety trade and there's we're in the

distribution phase of the stock market

meaning the insiders are selling to the

uh retail investors and if you look at

insider sales they're unprecedented

record so we're we're close we're I I

believe when we look back on this we

will see that we're already in a

technical recession right now. Uh the

third quarter numbers are coming out.

People are talking about 4% but you know

that's that's mostly uh da uh AI

databases but

>> probably because a lot of that data that

goes into the GDP calculation was held

up. So we didn't actually get all of the

data right

>> about half of the GDP is that that's all

we got going on right now is database

building. every other part of the

economy is rolling over and people are

feeling it. And you know, look, I I I

call balls and strikes. I voted for

Trump. Uh but you know, they came out

yesterday and they basically gas lit

everyone. Said the economy is great,

jobs are coming back and uh

affordability is is fabulous.

>> It's unfortunate nature of a politician.

You kind of have to fake it till you

make it.

>> And it's that's just gaslighting. The

economy is not great. We're hurdling

towards a recession and and if you look

at Bitcoin, Bitcoin is usually an early

harbinger. Bitcoin is now year-to date

underperform US treasuries or perform

slightly worse than US treasuries.

>> What he means here is that Bitcoin is a

leading indicator of what risk assets

are doing. And it's not just Bitcoin. I

mean, really, if you look at the alt

market, alt season, I mean, people have

been waiting for alt season for a very

long time. And the alts are just

absolutely getting reamed. Uh I mean not

just on on uh you know the 7-day but if

you go out for just the last 6 months on

on some of the alts the vast majority of

these are red. I mean, yeah, I mean, if

you look at various different ones, some

of them are going to have a little bit

of green and life, but boy, a lot of the

alts, I mean, this is a sea of red here,

and this is on the 7-day. Uh, and and

this this is true when we go out towards

uh some of the uh uh the 30 days or even

the six-month numbers as well. Uh, and

it has frustrated a lot of people in the

cryptocurrency market because the

thought has been, hey, like, you know,

the stock market is at record all-time

highs. Why are we not seeing more

movement uh in the alts? Uh you know,

here now all the way on the far right, I

added the 30-day column. And you could

just see, yeah, you've got some here,

Monero, and uh what do we got over here?

UniS swap up 30% on 30 days. But it's

it's mixed into mostly a sea of red over

here. Pretty wild. Uh and so this could

be an early indicator of risk asset

saying, you know what, we've got too

much exposure to debt. it's time to

diversify from some of this debt, which

I'm a big advocate of. A big big big

advocate of saying, "Hey, you don't want

debt right now." I I worry that one day

you're going to wake up and like your

stocks are going to be down like 20 or

30%. And as soon as the market opens,

you get an instant margin call. Terrible

time to be in margin, my take.

>> So, Bitcoin is probably going a lot

lower. That's an early warning indicator

of liquidity drying up. Uh, you know,

nothing against the Bitcoin people, but

it's not a store of value. It's a

speculative instrument that's 95%

correlated to the NASDAQ. period and

inflation is coming down and we'll get a

deflationary scare soon enough once hous

>> uh interesting to say that Bitcoin is

95% correlated he said to the NASDAQ

that would be to tech stocks somewhat

true you tend to see that relationship I

don't know that Bitcoin leads as much as

it follows uh it used to back in 2021 it

was a really good tool for that but

lately it's certainly been leading uh it

just hasn't done that a lot this year so

it is it is quite interesting there's

been a little bit of a divergence uh but

anyway uh as far as things are going a

lot lower. He's not the biggest fan of

um uh you know pumping it up right now,

is he?

>> Collapses cuz housing is 36% of the CPI

and that's coming.

>> Ah, right. Okay. And then he makes the

argument that because illegal

immigration has slowed down so much in

areas that were big beneficiary areas of

not just overbuilding but also surges of

immigration. you could see rents come

down and that ends up driving inflation

down substantially more. We know that

owner's equivalent rent, yes, housing,

like you mentioned 36% of CPI, it's only

about 25% of PCE. But he is right. If we

do continue to get flatlining rents like

we're seeing on apartment buildings

right now, especially or or even falling

rents in in some parts of the Southeast,

yeah, I mean, you you're you're going to

keep pushing inflation down. You know,

there's this study that was circulating

from the Federal Reserve that, oh,

tariffs don't cause inflation over the

long run. They just lower GDP, right? I

mean, but this is what people have been

saying that tariffs would lead to a

one-time increase in inflation because

that the tariffs were applied over a

larger period of time, you know, over

let's say 6 months. We might see that

bump over 6 months, year over year, but

after that, you sort of build in the

prices and then you don't have actually

long-term inflation. What you have is a

long-term compression of the economy

which actually then when you compress

the economy what a surprise leads to

disinflation potentially even as he just

mentioned a deflationary scare if you go

through a recessionary period that's

when you get the Federal Reserve to

print print the question is will the

Federal Reserve print early enough or

will they follow history absent what

they did during COVID and actually be

too late to print

>> so they're going to be behind the A-paul

and that's

>> well there's your the Fed will be behind

the eightball

>> when things really get going and uh we

see the credit markets blow out, there's

some uh bank issues, bank stocks start

collapsing and and the general indices

start going down quite a bit, we'll see

the Fed panic and cut 50 to 100.

>> That that by the way would be a form of

a shock, which we are shock primed for

that now with where we sit with yield

spreads.

>> I don't know when that's going to it

could happen. It could happen before the

end of the year or sometime in the

beginning of the year, but the Fed will

panic. at some point because they're so

behind the curve.

>> It's it's and it takes

>> Julia is like speechless here.

>> It takes 18 months for interest rate

cuts to actually affect the real

economy. So these cuts, you know, won't

save the stock market. They won't save

risk assets.

>> That is a big belief right now is that

oh well, you know, if we just if the Fed

just starts cutting, you know, oh, we'll

we'll be rescued. Everything will be

fine. They're not going to cut enough

until it's too late and and the amount

of pain

>> there. There'll be a you know a risk

asset rally, but not not anytime soon.

What happened and and why if he doesn't

do it soon, it doesn't matter what I say

or you say and we can say it's Biden's

fault. The American people won't, you

know, the opportunity to communicate

this and lay blame where it is is is

passing quickly because you're

gaslighting. It's not a good move.

>> What this this, by the way, I cut that

in from the interview. This was him

where he makes the argument that Donald

Trump should take the opportunity now to

basically say, "Look, we're going to go

through a recession and blame Biden uh

for that now rather than gaslighting and

say everything is fine." That's where

that is.

>> I said in January, February, there needs

to be fireside chats. We're going to cut

government spending, the illegal

immigration, juice the economy for two

years. I'm stopping it. Uh we're going

to have a recession and I'm going to do

trade deals and I'm going to bring

manufacturing back. We're going to have

some

>> again like if you did that, you would

literally just engineer a recession. We

know he's not the biggest fan of what

happened with immigration. We got that

loud and clear. But there there is a

little bit of a problem here with with

messaging potentially creating reality.

As much as we would like that teacher or

that doctor that says, "Listen, this is

going to be hell, but we're going to get

through it."

There's a reason why politicians usually

prefer to gaslight us. And people people

are scrambling for dollars right now

because things are getting tight and the

dollar uh dollars are valuable because

the the best uh

>> remember the fund manager survey at Bank

of America. It says hedge funds have or

fund managers have the lowest available

cash right now that we've seen in quite

a long time. And it has triggered the

Bank of America sell indicator. So when

cash allocation falls under 4% uh and

even worse if it falls under uh 3.8%

they say time to start thinking about

selling uh and so cash is becoming

scarce not just amongst fund managers

but also amongst retail. I mean really

the way we're seeing extra inflows in

the market right now is just more debt.

We saw with the Robin Hood numbers that

debt has increased on a month-

over-month basis in the highest most

extreme manner that we've seen for the

duration of the chart they gave us. So,

it's not great.

>> Uh, collateral to shore up margin

accounts and other things. So, that's

why the dollar liquidity issue is going

on. And, you know, I I I think one of

one of the benefits of this recession

that's coming is we'll be able to term

out our short-term Treasury bills into

longer term notes. So, we're going to be

able to do that. But,

>> okay. Basically, what are the benefits

of the recession coming? First of all,

that line is like so like it's

guaranteed happening. I mean, I'm on the

50/50 teeter totter. This guy is like,

"No, man. Foregone conclusion. We are

going into recession." He's like, "Oh,

we'll be able to do what Janet Yellen

wanted to do, which is uh, you know,

lengthen our our duration at lower

interest rates for debt." But, you know,

it'll also give us an opportunity to buy

things cheaper, I suppose. Okay.

>> It won't it won't be be because of uh

you know economic growth. It'll be

because of a recession. So our Treasury

Secretary Besson

>> that's the argument about inflation

coming down and yields coming down. He's

making the argument no yields are not

going to come down because of growth

like Besson says or Lutnik or Slutnik or

um whatever his name is. Uh but but

instead it'll be because of a recession.

uh we'll have an opportunity to take

Yelen frontloaded our our debt with the

Treasury bill issuance. He'll be able to

term it out at much lower rate.

>> Term it out is is strength is

lengthening it. Janet Yellen talked

about doing that but never actually did

it. That was his frustration here. Just

to clarify that because Yen Janet Yellen

did talk about that.

>> I'm not suggesting you take out a

helock. Do not do that in this

environment. But

>> oh, this is his suggestion. I love it by

the way. Don't take out debt.

>> Uh the bottom line is if you own if you

own your single family home

>> and you only have one property, you sh

shouldn't care about whether it goes up

or down as long as you keep your job and

you can pay your mortgage.

>> Basically, as long as you're not going

to go bankrupt on your mortgage, doesn't

matter if there's any kind of

fluctuation in real estate values. What

about stons, homie?

>> We are h hurtling toward a recession, as

you put in the conversation.

>> I think we're already in one. I was

going to ask you are we in I was like

are we in a recession now?

>> We're in one. We'll find out you know a

year or two from now when the official

when they do the official stats.

>> Okay. From what you can share like how

are you thinking about this environment

and how you want to be allocated?

>> I I've said you know for I I I was early

like Warren Buffett and I've said you

want to be uh and again this is up to

you personally where you are in your

life. If you're young, you know, don't

freak. If you have a 401k and you're 30,

you know, raise some cash so you can,

you know, buy at lower prices. If you're

near retirement, raise more cash and

then once the the storm we're in the in

the thick of the storm, you go you go

back in. You just want to have

flexibility and opportunities to uh take

advantage of what's coming so you can

sleep well at night.

>> Take advantage of what's coming and

sleep well at night. I actually love

this. And I'm not suggesting everybody

rush for cash, but I have been a fan of

raising cash. You know, the alpha report

we've been sending out, I've been

sending alerts on here's what I'm

selling, here's what I'm buying. And

it's not just the tickers or my top 10

stocks to buy for the next 10 years,

even if we go through a diply doodle,

but it's the ratio of selling to buying

that I'm doing. So, I kind of agree with

his race cash idea. And and it is not

just about trying to like time the

market, but it's also for that peace of

mind, that psychology that hey, if if

poop hits the fan, I'm I'm already

prepared. I've already put together a

war chest to go shopping. You know, you

can get the alpha report over at me.com.

Uh but let's uh listen to him finish

this out.

>> Um I never tell people what to do, but

it's called dry powder. And I've done

some consulting on the side with people

and

you know a lot of people who who call me

are already wellprepared. I guess it's

more it's more of a psychology

handholding uh situation to make them

feel good. So you know recessions are

painful and bad but there's also on the

bright spot you come out the other side

asset prices are lower. Millennials can

participate and get you know buy homes

and that generates a lot of economic

activity. And oh by the way, um you

know, if millennials and young people

have a stake in the country through

asset ownership, maybe they won't elect

communist mayors in New York.

[laughter] We'll leave it on that. Look

at Julia's face there. Well, I I I guess

you could tell their opinion on uh on

Mr. Mamani in uh in New York, but wow.

Okay. So, I mean, he has a point. If

asset prices come down, it gives you an

opportunity, gives Gen Z and millennials

an opportunity at the the prime of their

working career to over time build

exposure to assets. I'm a big fan of

that. I do worry that people are going

to get hosed and what'll actually happen

is the opposite is that people who are

now swiping up on stocks and swiping up

on leverage end up getting so freaking

hosed that they end up taking a decade

off and they're like, "Oh, hell no. I'm

not touching stocks again in my life.

And it takes them 10 years until we get

to the next bull run for them to buy

again and they're buying at the top

again. Like something to think like put

like a sticky note on your desk or

something. If we have a recession, fitty

fitty chance in my opinion if it

happens.

Please spend the 10 years from the

bottom up. From the bottom up slowly

acquiring, acquire ownership. That's all

you want over the next decade. Work

hard. Put the blinders on and acquire.

Acquire. Acquire.

What do they say? Be greedy when people

are fearful. Bro, we're like 4% off all

alltime highs and if you look on

Twitter, it seems like people are

fearful on X. We're not even close to

fear yet.

>> Why not advertise these things that you

told us here? I feel like nobody else

knows about this.

>> We'll we'll try a little advertising and

see how it goes.

>> Congratulations, man. You have [music]

done so much. People love you. People

look up to you.

>> Kevin Pra there, financial analyst and

YouTuber. Meet [music] Kevin. Always

great to get your