Transcription
What's up outliers? Welcome back to the Outlier podcast. We have a familiar face, Mr. David Hunter. And we are, by the way, happy anniversary. Our first episode released on 6th December 2021. And in that episode, >> in that I know, I know. When I was first prepping, I was just like, "Oh, we've been talking for, you know, like maybe two years, three years, maybe something like that." And then I I was looking at I was like, "Oh shit." Like it's been a while. Does apply when you're having fun, >> I guess. And I tell you what, the markets have provided no shortage of entertainment. So, I actually thought it would be really, really cool to start first with your current analysis of the environment broad. And then there's some stuff that I want to ask about like the evolution from when we first started communicating to where we are now to see just how the landscape has moved in your mind and things like that. But figure the easiest spot to begin would be to level set and just get a sense of what you think about where we're at now. What markets stick out to you, commodities, anything really, anything that is top of mind for you. I'd love to start there to understand the landscape.
>> Okay. I know we talked a few months ago. I can't remember exactly when it was. So, um, my fourth my fourth quarter letter came out in early October.
>> We spoke right around 23 October. Sorry to cut you off. Just pulled it up right now so that I could give it to you.
>> Yeah. So, you you already know this, I think, because I my letter had been out, but I raised forecast back raised targets back there >> for the S&P and the NASDAQ, the Dow and the the Russell. Um, so my my uh current targets are the same. They were 9,500 for the S&P, um 65,000 for the Dow, um 32,000 for the NASDAQ, and the Russell I raised to 3,800 back then. So, you know, basically 40 to 50% upside from here. Um little less than that for the Dow and the S&P, but um and uh I'm fully on board with that forecast. Very comfortable with that forecast. Think we're going to see a lot of it in the first quarter and probably spill over into the second quarter. I think it is a first half event as as has been my nature. I'm always extending things because the market decides when it's going to top out, but at least right now that looks like a pretty good forecast. Um I think in the very short term you could see three, four, 5% pullback in the market. You know, it's rolled over the last couple days. There's any number of things out there, including Iran, uh that could trigger a a quick selloff. So, um I just see when I look at the charts and things, some potential. It doesn't have to do it, but some potential. So, you might um yeah, you might take um the S&P down to um I'm just looking at numbers I looked at this morning, maybe down towards 6,700. Um, and I'm not sure, you know, NASDAQ might be a little more percentage-wise, but but basically, uh, be just a pause, it refreshes, a quick reaction to some, you know, some things. You got tariff things if the courts rule on that that could cause a could trigger a selloff. Um, you know, or we're in the middle of earning season, just beginning earning season. So, something there could do it. It's it's not any kind of a reversal. It just a quick kind of um you know it's gotten a little overbought and it wouldn't surprise me if we this little rollover we've seen the last two days extends for another few days. Um but I'm hugely bullish. I think um the bull market will be driven by lower rates. I keep saying the bond bond market I think is poised for a big move in 2026. Um I am also obviously can't ignore what's going on in the metals. I mean we we are seeing moves there particularly in silver like uh we never have seen before. I did in my October letter I raised my silver target from 75 to 100. Uh in my most recent letter that came out last week first quarter letter I raised it again to 125. So, I'm looking for, you know, still a lot more upside here. And as I said in my letter, because we're in a parabolic, that 125 could just easily be 135 or 45. Um, you know, it's when you get into that vertical, there's no magic to what point it stops. It's just it's going to burn out quickly at some point. But, um, I think there's still plenty of upside ahead. The institutions still aren't on board with the silver. Um or gold really. Gold more than silver, but silver um I think probably has the more upside here. I raised my target on gold to 5,500 from um 40 I guess it was 5,000. Yeah, I was I had raised in October to 5,000 and just raised it again to 5,500. So, and the other one, copper, which I have maintained the $7 number since early last year. Um, when they announced tariffs in April or soon thereafter, some tariffs on on refined copper, it dropped down. It had touched $6, dropped down to like four or four and a quarter and it's back up over six. I just raised my target on copper to $8. Um so you know metals of all kinds I think are rolling here. Um the you know the um materials ETF is breaking out and looks like it's got lots of upside ahead. Uh and you know there's I we're seeing a broadening in the market right now. The you know the MAG7 is taking a rest right now. The semis at least in the last couple days are taking a bit of a breather. Um but ultimately I think it's going to be uh all you know everything moves. It's going to be across the board. Most most of the markets going to be the small caps, the large caps. Um we we should have a a pretty good next three to six months.
>> I have what is this? Nine follow-up questions from that.
>> You went through a lot.
>> Yep. I have nine. But before the nine, I want to walk you through some of our prior videos. I'm just looking at my YouTube channel and I'm looking at some of like the general titles that I use to kind of figure out like what's going on in there. And in '22, we had talked about the potential for a bust. In '22 and March, similar. And then in July, we started talking a little bit more about the meltup. Then on 24 October of '22, we talked about the market bottoming and starting to move up towards eyes/meltup scenario. And then specifically, I noticed I'm skipping a couple, but when I got to one December of '23, we had talked about the meltup effectively being underway. And then on 17 April of '24, we were saying that the meltup is effectively going on. And then I see the same on 18 October of '24. And as I just listened to what you were talking about here, it sounds still supremely bullish, very, very upside-oriented. One of the things I was curious about is when we look at the timeline, you had obviously anticipated upside. I'm curious how the upside has e has like rolled out against your expectations because I know that you had spoken a lot about velocity but based on our conversations to me it seems like it's been like this pretty steady, pretty aggressive move up that's continued for some time and I'm wondering how that factors into like what you expected to see.
Well, certainly I never expected it to last to take this long or last this long. Um I attribute a lot of that two things. One, um keep in mind when when we look at uh the Fed balance sheet in 2008, it was 875 billion. That was and that was the largest ever been from 1913. Um, you know, fast forward through the 2008, '09 uh downturn and the response to that and QE1 and two and three and you were up to 3.7, I think 3.7 trillion um and then the pandemic hit and we went from 3.7 to 9 trillion. So we we have never seen and that that happened over the course of, you know, 12 to 18 months where they panicked, they closed the um entire world economy down for a quarter and they said we got to do something to offset that. So they panicked and printed money like crazy. So you had five trillion go into the market or into the system and that's just Fed money. Obviously other central banks did similar. Um, so we've never had 5 trillion. We we never had 5 trillion as a balance sheet, never mind 5 trillion in, you know, put into the system in a year and a half. Um, and so you never know. I mean, it's unprecedented. It's nothing we can go back and look at past history. You you never know how much of that money how long it's going to take for that money to kind of flow through the system and be used up. We're still going. I mean that five trillion is still part of why we're still going. So from that side, I would argue we're just in, you know, uncharted territory in terms of um Fed liquidity and liquidity in general that's kept this thing afloat. From a technical perspective, what we've had, which is amazing to see, is that and I'll I'll really start from '22 from the from the bottom in October '22. Um, keep in mind people were expecting at that time the market bottomed at 3,500 or thereabouts and the call the majority of calls at that time were saying we're you know almost decidedly heading for 3200, maybe maybe below 3,000 and they, you know, they were bearish. We we moved up that when they saw the thing come out of the 3500 and move up, the most of the street was, yeah, okay, you can get a a bounce. It was oversold. It can go a few hundred points, but it's going to roll over and all the way up from 3,400, 3,500 to 3,800, 4,4200. That's all you heard was this a bare market rally. Yeah, it's extended more than I expect, but it's rolling over. And so they stayed skeptical. When it got above and I can't remember exactly, but I think above 4,300, certainly above 4500, uh, people started getting more on the bandwagon saying, well, this has a little more legs, uh, but 4,800's the high that we came off of back in at the end of '21, so we're not going above that, it's a double top and then when it blew through that, all of a sudden they had to acknowledge that, hey, this this is no longer a bare market rally, this is something more than that. But even then, all the way up through to today, every little selloff, people, as I keep saying, uh, institutions particularly have one foot out the door. You know, they're kind of halfway there saying, "I got to stay invested." But every little selloff, they get bearish. And then we get a little more than a little sell-off like last April. And you had sentiment go back almost to the 2020 lows, you know. So, so what that all is is that you're you you've had a wall of worry. It comes down as you rally, but it gets rebuilt very easily with a three, four, 5% selloff. And if you get something bigger than that, 10 or 15%, it really gets free built. That allows this thing to have continual fuel. So from both a monetary standpoint and from a technical standpoint, this thing has just been I think you uniquely positioned to keep extending. And what I what I have done um and because I as you well know I get u beat up on not so much lately but beat up on on X um for calling for a bust and having called for a bust for years. I go, but if you look at my what I've said all along, never once have you seen me um even in '22 when we were selling off, but never once have you seen me say the top is in uh or that we're near the top. What I've said consistently is a g a global bust will follow the top. And I've continually raised targets and extended the bull market uh without any hesitation or without any lessened conviction. Um, what's misunderstood is that there's no timing to that. I get myself in trouble certainly when people ask me um when do you think the bus is going to hit or when do you think the top's coming? And you know, many times in the past I've said, well, maybe, you know, we might have another six months to go and and then when we get there, next thing you know, it's another year past that and it's another year past that. So, if if I were a timer, I'd get Fs. You know, if this were based on timing, but if you listen to my my calls is not based on timing is is based on when do we reach my targets.
It's funny you frame it that way because when I was looking through the videos that's it's kind of what I picked up is that like if somebody were to ask me like how is the timing played out on your calls I definitely would say it it hasn't lined up objectively but in terms of milestones as I look at this it's kind of crazy to be honest like how some of this stuff lines up because when I was looking at our 24 October '22 video you were literally you the title of that video is market bottomed and headed for top. Now the rest of that is in 6 months. So obviously the 6 months didn't come to fruition. But if we think of what you're talking about in general 6,000 cross that then I look at one December '23 and you had a target I think at that point or in the thumbnail I have 7,000. So that obviously was on the the plan. So it's it's really interesting to see like the major muscle movements as you're thinking of them and then experiencing how complex of a system markets are. When you think about the way that you forecast and the way that people should interpret your forecasts, there's kind of two pieces to it as I typically see from our conversations. The first piece, well, I guess three pieces. There's typically a target, some sort of velocity measure, right? In terms of what the shape might look like, and then there typically is a timeline associated with it. So when somebody is like listening to what you're talking about and when somebody is digesting across those three vectors, unless there's more that I'm missing from your lens, but across those three vectors that I see in terms of target, velocity, time frame, how do you think they should like prioritize those pieces as they're listening to you and digesting the information?
>> Yeah. So the timing typically is is to give a best guesstimate at that point in time of how this might play out, you know. So, and people laugh at me because I probably use the term three to six months as a you know, constant rollover, but um it's it's really not as I say, I'm not providing a trading call, which trading call obviously you're a trader, you know, really does have to have a time element to it, right? Specific.
>> But as a strategist, I'm I'm calling a cycle. The cycle is going to be determined by the market, not me. I mean, that may sound like a copout, but that's really true. It's I don't control the market when it's, you know, but I do control what I see ahead of me. And so, as long as I'm continually seeing more upside, um, you know, I'm not so worried about when does this come to an end. If if I said, you know, I think we're 100 points away from the top and you're not going to be able to time it quickly. Get out or you're not going to be able to get it perfectly, get out. Then I'd be guilty of making a bad call. But if I'm typically when I'm raising targets, I'm raising them when everybody else is going the other way. For example, last April when the market dropped 20%. And people said the top is in and you know, they started lowering their targets. I raised mine. I was at 8,000 and raised 8,700 right at near, you know, within 50 points of the bottom um in April and and um and then raised it again in se October to 9500. So um I'm raising way in advance. It's I'm not playing a good till reached game. I'm not saying, okay, you know, momentum has taken me almost to my target. I got to raise it or else, you know, I'm I'm going to have to turn bearish. It's not that. I'm usually going by sentiment. If sentiment's getting more, you know, more favorable, meaning more bearish and giving me more fuel for the upside, I may see that there's more room. And and I'm looking, obviously, I'm looking at things from a, you know, I may be looking at 20-year charts or 10-year charts or five-year charts. Um and and so there's a much broader perspective of what's the upside. What I can't tell in using that broader perspective sometimes is how fast it'll happen. My the the reason I've constantly said it could happen pretty quick is that at some point here, and I think we're getting close to that point, but I thought that before months,
>> we're we're going Yeah. We're going um parabolic. And once you go parabolic, I mean, just take a look at silver if you if you want to understand my thought process going all the way back to the teens back before 2020, uh, where I saw that ultimately it would it would we're in a a final um, you know, last several years of a secular bull market that started 1982. It would steepen until it ultimately at the end went vertical. Just look at silver in the last few months and you'll have your description of parabolic. I mean, and that's that's what I'm saying. You know, silver went from I don't know exactly when this was, but from 30 to, you know, now 90 uh triple in a year in a year's time, you know, or less. So, so it may sound crazy to say we're going to cover 40 or 50% of the market in 3 to 6 months time, but that's what a parabolic takes you uh can can give you. And so that was always why I said, well, it could come as soon as 6 months from now. I never said it's six months from now. I said it could come as soon as. But what gets interpreted is they hear the six months, so they say, "Well, you said it was going to top out in six months." No, I said if all things fell into place, it could be as soon as that. And and that's the that's the reason I would use that is because of that parabolic final part of it. And that I thought we were getting closer to that,
>> which funny enough, if anybody when you have time, pull up a chart of S&P and just go back to, you know, like 1990 to present and throw like a standard deviation channel on it for context. And you'll see right now to the upside, we're like four standard deviations to the upside. So depending on, you know, the the nature of parabolic and, you know, the the duration and time frame of it, one I think could easily argue that we're starting that or at least in it because effectively from what I see on the lows in, you know, '22, '23, kind of that after that that bare market, it has been an absolutely profound move up. We did have that pullback in April recently that immediately got undone.
>> So,
>> Yep.
>> Yeah, I
>> it's it's amazing that uh, you know, we had that whatever it was 50% move um maybe more than that. Let's see. S&P was down around 48.40 40 I think and moved up to um well now we're seven but but in October we were probably 66 700 um so yeah it was basically a 50% move happened in six months time and I have people pushing back at me when I'm saying meltup and saying this is, you know, this is meltup means an unusually strong market and they're trying to argue that it's a very normal market. And I go, it's not, you know, if you go back and look at this last five years, this is not a normal market. And you know, yes, you had some big volatility in early 2020 and some volatility in 2022 and a little in '23 and again in April, but those are just um corrections in the bull market. But if you look at the amount of ground we've covered, you know, I think I think the NASDAQ was 10,100 in October of 2022. You know, we're more than doubled there in a few years. I mean, the S&P was 3500. We're double that. Um, and and yet you have people complaining that it's just a normal, you know, you're talking about a meltup. This doesn't look like a meltup. And I go, yes, it is. Stretch out your like you did. Stretch out that chart and you'll see a much what my whole thesis is that every every leg is going to be steeper than the last one as we move into the top.
Which is really, really interesting because one of the early questions I had for you that I definitely admittedly still struggle with understanding is trying to understand like the continued fuel, right? When I look at the recent few years, I'm already seeing from what is this 20 from the recovery of 2020 towards the beginning like 2021 S&P was like 3,400. So from that point to now we've doubled. And I I sit there and I say like well there's a lot of new technology that came out over this time frame. there's a lot of stimulation to the economies and whatnot. So like I can see specific things that can fuel this. But then to like picture something that goes even more parabolic in my mind, I think like what are the additional catalysts that could drive that kind of move given what we've seen so far and what that's led to when you think about when things might go like really parabolic in a short-term time frame. What's the fuel for that?
I think a big part of the fuel is going to be we've been in a two-year basing process for the bond market. Everybody wants to be bearish bonds or at least, you know, long bond. They're talking about going up, you know, rates going up, not down. And people are discouraged because 10-year, you know, is stuck in this trading range between 4 and 4.20. Um I think we are poised for a move down to 3% and below in the next six months. So by mid-year um probably 3% and maybe below 3%. Um that's a big move to go from 4.15 or wherever we are today down to 3%. So one is rates down and I don't care what the Fed does. Everybody wants focus on the Fed. The bond market's I think ready to rally either way. Um, the dollar I, as you know, I have a target of 82 on that. I think it's very close to the end of a six-month consolidation. Uh, maybe it's longer than that even. Um, and we'll roll over and head for 90 and then probably consolidate again before it heads for 82. Big drop in the dollar will help, you know, I think help. Um, I also think you have an underestimation of just how much is going on in the Trump, not you, but you know, the street, just how much is going on in the Trump uh agenda. You know, you've got deregulation, you've got um the big beautiful bill. There's a lot of things that don't kick in until now. Um so I think there's a lot of things like that that will be received by certainly the institutions uh as they see it starting to happen um they're going to become more bullish on that. I think the I think the narrative that you will get over the course of the next six months is going to be moving more and more towards um either a soft landing or not even a soft landing that this thing is gaining some legs that um the Fed's just beginning a you know new easing cycle not so much from a rate standpoint but from a a monetary standpoint, you know, they they pulled the balance sheet down from 9 trillion to 6.5 trillion and they're now having to pump money in again because the banking systems needing it. So, you're starting to pump money again. Uh I think you're going to see as we move towards the second quarter, the rhetoric is going to be the narrative is going to be this thing has legs. The Fed's just beginning. This thing can carry for a couple more years. Um, you know, interest rates coming down so the multiples can expand even further. Uh earnings, which have been remarkably good through all of this, um may accelerate or at least stay just as good. Um so I think and then you've got deregulation, which deregulation is going to help energy. Not that that's one of my favorite areas. It's not, but deregulation is going to I think help push um oil down, oil prices down, and that means lower inflation. Um I think um the deregulation's definitely going to help banking. You know, not the stocks not withstanding the last two days, but I do think you're going to have more and more of those things that people can latch on to, particularly if you have a positive tape. Um institutions are finally, I think, going to be all in. And they have, as I said before, they have fought this thing all the way up. Even now, we're talking about their financials.
What do you make of the 10% cap that Trump was talking about placing on credit cards, obviously near-term financials pulling back a bit. What do you think of the longer term impact there?
Yeah, I I have a hard time seeing that we're going to get that. I mean, I I I think it's typical Trump starting with some extreme position and then working back towards something more amendable to everybody. Um so I you know I I do think and I know the bank analysts will push back and say you know they need those rates because the lower end of the income scale, you know, there a lot of defaults and if you if you want uh lower income people to be able to have credit cards they've got to accept that, you know, there's more write-offs there for the banks, they've got to be able to write this profitably, etc. I I think rates are userious once you get up, may certainly over 25%, maybe over 20%. So I could see it going back more towards the high teens or 20. And keep in mind he's only saying for a year. Um, so that's basically what is that? That's an election year promise, you know, or an election year delivery. So I could see maybe we get something like that and I think the banks can operate in that environment. Um, I I think it's amazing. I think the analysts carry water for the banks or, you know, and and talk about how, you know, it's it's devastating if you cut their rates, your credit card rates, but I mean, come on. Um, and so I I I do think at the high end they're too high. I think 10 10%'s not realistic. This is an unsecured credit. Um, so they have to be able to, you know, write it at a a reasonable rate, but I think somewhere between 18 and 20% I think could be a an area. I don't know if they're going to ever get there. What whether that, but I I don't even think, you know, again, that's how Trump starts his negotiations is at some extreme place. Um, and he and he's pretty convincing that he that's what he thinks it needs to be. But, you know, I don't I he's got he's got, in my opinion, probably the best Treasury Secretary we've ever had working with him. And I don't think Scott Besson uh thinks that's, you know, reasonable at 10%. I I would guess that, you know, this thing will get negotiated higher, but but we could see it, you know, see some some kind of a a cap.
>> It's funny you say that that honestly I I was talking with my community about that not that long ago, and in the first thing that I said is Trump negotiation tactic. That's the first thing I thought too. Um, next one. This one I find is funny. By the way, we just got through my first follow-up, so we're crushing it. This is going to be a long video.
>> My next followup, tariffs are announced, market loses its mind and craters. Craters, right? We'll put it in context. Not really that bad, but does go down. We're talking about potentially the court saying you can't do tariffs. And now we're talking about the market going down on the reversal of the news that it went down to before,
>> right?
>> Why? Why is that the case?
>> Yeah. Well, first of all, everything you hear is that even if the courts rule against the administration, they have um plan B, plan C, plan D. And so I think I think any reaction to the tariffs will be days, not weeks. Could be, you know, could be the reason for a 5% sell off. Uh, I don't think it's anything more than that. And it may not even be that. And I and I get your question, which is how can it be bad to introduce tariffs and then be bad to rule them out? You know, I you know, the street wants to worry about everything, I guess. Um, so and and funny the I don't know whether it's a clue or not, but the the fact that they keep pushing back their decision, I don't know whether the Supreme Court is nervous about it or um what's going on there. But um frankly, I I trust Trump has some good people in in that area. Jameson's um you know good guy and um I think his economic people are pretty strong and his legal people too. I I just don't think you're going to see tariffs just wiped off the map here um no matter what the Supreme Court rules.
>> Yeah. Yeah. With respect to crude oil, we have had obviously the party in Venezuela, which I have to be honest from a military lens, that was awesome. From every other lens, you're free to have your opinion. The fact that that went down the way it did though from a militaristic perspective, super impressive. But now we also have the conversation with Iran entering the picture. We might get Greenland somehow someway. I Shane Gillis, I don't know, he's a comedian. I'm not sure if you're familiar with him, but he has a hilarious joke about that. He says he really hopes that there could be the potential that the trick from Leaf Ericson a thousand years ago about Greenland being green and Iceland being ice, but it's really switched. His joke is that he wonders if that's actually playing out here. Uh, obviously it's a little bit more than that, but funny joke nonetheless. But there's a lot going on in different kinds of commodity based sphere and I want to focus on oil for just a second. What's your perception of oil and what the future whatever time frame you think of looks like for oil because there's kind of a a few competing factors going on right now.
>> Yeah, for sure. I mean, obviously it's it's bumped up from the mid-50s um to 62 today, I think. Um and I had I put out recently um that when people asked me, "What do you think oil's going to do u before the bust and I said I still don't think it's one of the lead sectors? I think it'll stay in a trading range probably low to mid-50s to low to mid-60s." And I said the low to mid-60s is probably if you see any kind of um geopolitical stuff, you know, rear their ugly head. That's why you would get up there. And that's what we're seeing today in the last couple days is you know the the Iran news is I think this certainly sounds like something could be imminent in terms of Iran. So um, you know, people get nervous about it there. Could it could it run to 70 real quick and something like that? It could. I mean I, you know, geopolitical moves who knows, you know, in the very short term, but I think ultimately it would settle back down. Supply and demand forces would tell you that it's um unless it's a drawn out thing and I don't expect that at all. Supply and demand uh would tell you that it belongs in the 50s. Um and then I think in a bust with um an economy tanking around the world, you know, it belongs in the 30s and maybe below that. Um, so that's that's kind of my outlook. Um, and uh, what I will say and with respect to Venezuela, you know, you hear a lot of people want to poo poo the 300 um, billion barrels of oil or is it billion or trillion, I don't know what it is there that Venezuela controls, you know, their reserve the under their control. Um, and people say, well, it will be, you know, that's a 20-year plus type program. It's not going to influence anything. My forecast, as you know, is $500 oil by the early 2030s. If you, and that means we come out of the bust with oil down in the, you know, at 30 or below, and we start building up from there in the first year or two out of the bust, you might be, you know, 50, 60, 70. And then by the time you get to the end of the decade, you might be 200 or 150. By the time you get into say 2032, '33, you're at $500 a barrel. If you get oil moving like that, and you're getting it because of the massive money that will be printed to get us out of the bust. If you get if you get oil at those levels, you're going to see all kinds of development. And having Venezuela available to develop rather than be um under a regime that was basically taking the oil the other way. Um, you know, meaning meaning um Maduro. Um, if you get if you have a free market system down there, if you have a democratic Venezuela, that country number one is going to be like the Middle East was for so many years rolling in money. You know, their their citizens are going to say, "Wow, thank you, Donald Trump." But number two, from a world perspective, that really is a huge thing to have. You know, if you remember back 25, 30 years ago, peak oil, I think it was 20 years ago, whenever it was, peak oil meaning we're running out of oil in the world. You know, you there's nowhere we're going to be able to develop oil to meet the demand. Um, obviously that's not true. If you've got, you know, Venezuela is one place to tap. So, I don't buy into all the negativity saying, you know, what's Trump doing then oil is not going to be developed for decades anyway. You know, he he talks like that's some something that's really going to help the world economy and help the US. I I do think it will look like a master stroke when they look back at it. Um, so and it does feed into my view that, you know, oil will be one of the lead groups to own post bust. You I don't want to own it now, but post bust energy is going to be right at the top of the pack, I think.
And for those that don't remember, Venezuela when they first started discovering their oil, Venezuela was insanely profitable as a country. They were insanely profitable. And
>> yeah, it obviously started turning to the other direction. I think they have like 500 billion barrels of recoverable. I think their current reserves are like 300 300 billion or something like that. 3003 or something close there.
>> Yep. And and they've you know been producing less than a million barrels a day I think where they had been producing three million before they
>> you know kind of got wrecked.
>> Y two more follow-ups. The first one, the we talked about it a little bit earlier, but it's absolutely fascinating the move in gold. Who who is buying gold right now? And what's the play?
>> Well, certainly the central banks are buying it. Certainly China's buying it. Certainly the BRICS are buying it. Um I think other other countries are. I think uh maybe some of the Eastern Europe have begun accumulating gold. Um and and certainly institutions have to be starting to accumulate gold. I mean the the gold story has been around for a couple years now. Silver's later, but certainly gold I think has been a few years here. And so the institutions have had time to kind of move away from the idea that well gold, you know, the Warren Buffett idea that gold doesn't um doesn't pay you anything. You know, there's no dividend, there's no earnings or anything. So, you know, he he was never a fan of gold, but gold is a monetary asset. Um, and certainly, um, there's a lot of reasons why it's moving up, but right now, demand far outstrips supply and prices are going to continue to go up.
And do you think that the folks that are accumulating gold, is this some sort of like decadel long play? Is this a shorter term play that they just want to add it to the balance sheet? like what's the what's the driver for gold now and what do you think the game plan is for the position?
>> Yeah, certainly for the central banks and certainly for the uh the BRICS, they think if they can um accumulate gold and move to some sort of a goldback currency um that they can compete with the dollar and I think that's their long-term plan. And that's kind of it's that plus the fact that I think for all central banks in all um countries, you know, everybody kind of could step back and say, you know, the world we live in today is uncertain. The fiat currency environment is uncertain. Um, we want some uh gold as a hedge or a protection against what it looks like, which is to get out of this massive debt of 330 trillion around the world. There's only one way you're going to get out of that, and that's that's to print more money, right? And you're not going to get out of it, but the only hope you have is to print more money. So it seems naturally that you would want something that moves up with inflation, moves up with, you know, liquidity. And I think that's a lot of what's behind gold kind of from afar. You know, near-term, it's more the central banks are buying it and there's not enough gold around. Got it. Last question. Pivoting to sentiment. You've referenced it earlier that that's like a primary driver of how you conduct your analysis. When you think about the bust, what are some of your preferred sentiment gauges and what do you think they might look like? Maybe not like at the bottom of the bust, but leading into the bust. The the implicit concept here is to try and give listeners some sort of idea on what they can look at to monitor for like the topping function as you see it before we start rolling over.
>> Yeah, I I never use the the um sentiment indicators in any kind of scientific way where I have numbers that I'm, you know, but it's pretty easy to see. I mean, you can use use as simple as one as the, you know, the CNN greed fear greed index, you know, because you can see the, you know, it's got the the dial and obviously you want to get it way over to the fear side, uh, to be bullish and way over, you know, when you see it way over on the greed side, you're, you know, you want to be nervous about the markets or be, you know, cautious. Um but, you know, AI is one obviously you can look at the CNN uh fear greed index whatever they call it. Um, the um one one that I like is the Bank of America has a uh a survey of portfolio managers uh or fund managers and it's kind of gives you what they're where they are in terms of accumulating cash or allocating to equities etc. And that usually tells me where the institutions are at to some extent. Um, there's a um investor's intelligence which is a measure of um some of the guys like me, you know, letter writers out there. Um, and that again that gives you a sell kind of a sellside um perspective on what the strategists think. Um, so you can get, you know, you can get perspective from money managers from um strategists or, you know, people that have opinion on the market um from in from individuals um and, you know, just put it all together and I I just it's pretty easy to read sentiment as long as you're looking at it from extremes. You know, when you're in the middle, you you know, you kind of have to have a feel for it, but when you're at those extremes, it it tells you something, you know, and I I think we will see at the top, there will be an all-in type sentiment. Uh like I said, people think this thing has legs and can run for a couple years and when you're at the bottom, nobody's going to want anything to do with it. And, you know, we saw that in 2020, March 2020. And and the thing I use sentiment more um like I said I don't it's not so much a numbers thing but there's some feel from from the um when when everybody's talking very negative when when you hear that there's, you know, you don't have any use for that whether it be a stock or, you know, whether it be a metal, whether it be, you know, well silver, silver a few years ago, people had no use for over and I was getting, as you well know, I was getting beat up for being a bull on silver. People were sure it was not going to get out of its own way because every time it lifted its head, it went the other way or it sell off again. And when you see that kind of sentiment, that's that should uh warm the cockles of your heart. You should start thinking, hey, this thing might be attractive.
Last question. Looking out to the year ahead, what is most interesting to you? Like what do you have your eye on going through maybe not even the full year, that's kind of a long time, but let's say like the next quarter?
>> Yeah. Well, I I think we it's it's a very interesting exercise here with silver. Silver, you know, should be front and center for everybody. Um because it's it's moved, you know, it's moved so quickly from 50 to 90. Um and you've got people, you know, I'm I I had 75 as a target for several years and I was way above almost anybody. You know, there were people that thought we might double top at 48, but then there were lots of people that thought it couldn't get above 35. Um, and when it blew through 48 and 50, it was at 75 very quickly and then kept going, you know, pause for a little while and next thing you know, you're at 80 and 90. There's there's one guy anyway and maybe a couple guys out there talking 200 and 300. Now, I don't know if they really think you can get there in in my time horizon because I have a $500 target on silver. It's just not now. It's, you know, early 2030s. Um, but I think this guy and one in particular is talking about more this year. And like I said, if you go into a parabolic, there's no I I can't argue that that can't happen, that we can go to 200. I would have a hard time thinking that's what we'll do. But um it's not impossible. Uh and that's that's a big statement to say that a, you know, an industrial metal, an important metal, a metal that's, you know, certainly watched by a lot of people could go from being $30 less than a year ago to something, you know, seven times that number. That seems pretty incredible. So, I'm you I'm going to be watching that like anybody else. I have 125 as a number. That's pretty exciting. Um, but, you know, I don't know what, you know, I don't know what the next few months brings. It could just blow through that. Um, and then um
>> sorry, just a a super quick note on silver for for folks just to give them a little bit of context. I'm measuring it right now and when it started its breakout on the 28th of November of last year, so 32 trading days ago till the close right now it's up 73.8%. 32 trading days. So just to give context to what you're talking about.
>> Yep. Um and and you keep hearing that there's a shortage of physical that the, you know, the paper dwarfs and that there's a lot of short, you know, shorts on the paper particularly in the European banks. So who knows what happens there. I mean, so I'm watching that almost more out of um fascination to see what really does come of that. You know, I'm comfortable with my forecast but I also know it, you know, it could blow right through that. Um, and um and then I I just think, you know, the equity market, we're in this is history. I mean, I really do believe we're at the end of a 43-year secular bull market, whether it tops, you know, in April or tops in June or again, I have to extend. I have, you know, I don't think so, but it could. Um, any way you slice it, I think we're very close to a top relative to the fact that it started in 1982. And again, there's another thing. The Dow, you know, Dow is what, 49,000. Um, and uh, that started this move back in 1982 because I, you know, I followed the Dow more than the S&P back then. So I, it's etched in my mind. I think it was 780 at the bottom in 1982. So it's gone from 780 to 50,000. I mean, this is one hell of a bull market. You know, again, it's a secular bull market. There have been cyclical bears within that. But um, so just the fact that this thing could go parabolic, you know, that the equity market could go parabolic. I think that's going to be really interesting to watch in the next, you know, three to six months, too.
Well, I cannot wait. And as always, it's absolutely awesome catching up, David. Thanks for taking the time to hang out. I know folks can find you on X. They can reach out to you for your newsletter there. I will have the correct links to all those so that they can find the correct person there. But as always, really, really cool just poking around, understanding how you're viewing things, and I appreciate you taking the time to to share with us, and I'm looking forward to catching up in a few months, and we'll see how it all lays out as per usual.
>> Yeah, thanks for having me on. I will say these three months that we have between go awfully fast these days. It feels like we just talked.
>> Yeah, it's it's always good to catch up, David. Thanks for hanging out.
>> Okay. Thanks, sir.
>> All right.