Final BLOW-OFF TOP: Stocks & Crypto Rally Before the Crash | Henrik Zeberg
Summary
Market Outlook: The guest sees a final wave equity melt-up toward an S&P 500 peak near 8,100, driven by sentiment and psychology before a sharp reversal.
Consumer Weakness: He argues the real economy is fragile, citing record low savings, high paycheck-to-paycheck living, and deteriorating confidence as the core risk that could trigger a crisis.
Bonds and Yields: As growth slows, he expects yields to fall and bonds to rally, favoring long-duration Treasuries in the next phase.
US Dollar Path: Near term he anticipates dollar weakness (supporting risk-on), followed by powerful dollar strength during a downturn that pressures global markets and liquidity.
Precious Metals: Gold and silver may enjoy a short-term bounce on a weaker dollar, but he remains cautious until a later policy response phase when he turns strongly bullish on precious metals and gold miners.
Crypto: He expects a risk-on bounce with Bitcoin and especially Ethereum outperforming in the near term, noting potential for notable upside before liquidity tightens.
Commodities: Oil supply shocks are seen as deflationary given weak consumers; a stronger dollar later would weigh on commodities, but he expects commodities to shine after central bank intervention.
Transcript
at some point there's something that's going to break. So when people are saying, "Oh, that was a black swan event." I say, "Why was there a black swan event?" I don't I don't think that all of the We also see the private credit started to to wobble. We don't know how big that is. I mean, I was in an interview yesterday and say, "Oh, it's not so big." And we don't know. It's in a dark room. I It's a you know, back in 2007 and 8, we kind of had an idea of it how big it was because we had a uh we had it all on the balance sheet of the banks. Today, we don't have that. Renewed news of a peace deal in the Middle East have sent stock the stock market, commodities flying higher. The S&P 500 has been trading at record levels for over a week now. And uh is this just the the final phase in the melt in in the in the meltup? Is this the blowoff top we've been expecting to see? What does it really mean? Like what phase are we in right now? Let's let's take a look at the economic data. Let's take a look at commodities. Let's take a look at crypto. We'll throw a Bitcoin question into the conversation here today as well. My guest today is Henrik Zeberg. I'm really excited to have him back. Uh I really enjoy our conversations and controversial thinking sometimes, but it is refreshing and I enjoy it. So really looking forward to having this conversation with Henrik today. But before I switch over to my guest, hit that like and subscribe button. It helps us out tremendously and we really really appreciate it. Now Henrik, thank you so much for joining us again. It's great to have you back on. Thanks so much. Thank you for having me on again today. Kai, >> yeah, really looking forward to the conversation, Henrik, and uh can't wait to dissect what is happening in the markets with you because I'm I'm getting so many mixed signals. Um, personally, I always thought we were we'd be closer to a crash than ever before, but the markets are telling a very different story, especially looking at maybe the main indices. Uh, everything seems to be honky dory. Let's let's start high level. Henrik, what's your initial assessment here? Well, I mean, four or five weeks ago, I was uh very l you know, lonely in the in the bulls camp. I think there were obviously there is always others, but uh but on Twitter or in X, I was saying that this is not the thing. This is not yet. We're not there. And uh even though I am this is where you're, you know, insanely bullish, but also insanely bearish at the same time. It's uh where people sometimes might not understand but understanding that in a certain time frame when we have a let's say the next uh I don't know a few months here uh you would see that uh the stock market could do really well and uh this is not because the economy is strong this is because that is what happens into the final phase of a uh of a bull market first of all and of also what happens into the into a topping uh business uh cycle. So everything is actually playing out quite nicely here. I I for me I mean if you were expecting the drop here in that this was be would be the top. You would be surprised now and then people say oh we don't understand what's going on. If you were expected that also last year in April and saying oh this is the top and you know I was there out out there again and saying no that's this is not it. Um then of course you would start to be what's going on. But it's not so difficult actually what you need to look to is the real economy and the real economy is slowing. It's not to the point yet where we where we should be worried about an imminent recession, but you'd say it's definitely getting closer and there is structural setup where you look to the as again as I say the real economy and this is not about earnings and this is not about AI and this is definitely not about Iran but the real economy the consumers the boring stuff of the economy that is they the consumers probably at the worst place we have ever seen them in the US and also elsewhere in the world and this is not what what is the headlines of the on the news and in the media uh probably because it's boring and I don't know what it's much more you know interesting to talk about Nvidia's earnings or something. >> No absolutely no lots going on but uh maybe just to to maybe put a frame framework around it like what phase in the meltup are we in right now? Is this more the end? Is this the beginning? Like I'm just curious like what what what is your data telling you? >> Oh, we are in the I call it the wave five. This is the final move. This is the this is the move into the top. And that's why I also a few weeks ago and to our clients also I said this is going to be a straightup thing. You're going to see like in 2000 when we had the biggest tech bubble at any point until that point you saw from the January of 2000 until the top in March uh six weeks six weeks you saw a 45% move. That is what I was calling for just some weeks ago and I said this is that the setup we have right now is uh wave four bottom we're going to see in a bigger setup. It's, you know, difficult to try to see here sit here and trying to tell how what the market looks like. But that was the bottom we saw there in on March 30th and then we saw the explosion higher which is always a very very powerful move. It goes straight up then there is a correction and everybody will become bearish again. You know, mark my words, we will have a pullback and it'll be severe and strong within the next few weeks here and then people will say oh this is it. The bears will come out again and say we are doomed now. And then it will turn one more time and go up even stronger into that final top. And that will be the one that top will be the one where everybody then has been turning bearish bullish bearish bullish and that to the point where they're simply just you know cap capitulate and and and say okay the market is just too strong and we're going to go higher. That is why sentiment and psychology in the markets is so difficult. But study that and you'll see that this is exactly what we need for people to be on the wrong side. So first up down up we're there. You and David Hunter have a very similar thesis on in in that regard, I believe. So, he he's calling for 8,100, I believe, in the S&P 500 if I'm not mistaken. Hope I'm not misquoting. So, I think it sounds like we're on track to to hit that number, right? Um >> I didn't I honestly I know that the he's talking about that I steal his stuff. I don't follow the guy, but I understand that the 8100s. That's interesting because I have the same number. So, that's quite interesting. >> Yeah, I I think it was 8100. Don't exactly quote my I interviewed him late last week and I I should look it up. I should know better. But uh um Henry before we move on like actually interesting question like you you just mentioned it as well psychology like why is it that in a final phase of a market there is that blowoff rally like where does the excitement come from? help us understand the psychology or the psychology behind that final blowoff move. Like as you as you said, the real economy might already be crumbling, but the market is still rallying. Like where does the market get the excitement from and help us understand maybe from a psych psychological point of view what that means? Before we continue, let's talk about a company that is challenging the status quo in a very controversial but a very calculated way. Enhanced, currently trading under NASDAQ APA and set to become ENHA, is building what they call the next generation of global sport. But this is just not another competition. Enhanced Games is positioning itself as a modern era alternative to traditional events like the Olympics, except with record level athlete compensation, full transparency, and top tier medical oversight. They're asking a simple but uncomfortable question. What if performance enhancement already exists in elite sport? And instead of pretending it doesn't, you bring it into the open, regulate it, measure it, and supervise it scientifically. Their model puts doctors, data, and athlete health at the center. The chairman recently called it a paradigm shift, focusing on recovery, long-term well-being, and protecting careers rather than stigmatizing enhancement. Now, here's where it gets interesting from a business standpoint. The games themselves are just the front end. The real opportunity may be the broader consumer platform. enhanced plans to launch teleaalth and scienceback performance and recovery products in Q126, bringing elite level oversight to everyday athletes, longevity enthusiasts, and people who simply want to optimize their health. This is a convergence of sport, biotech, longevity, and consumer health. And yes, it's controversial, but disruption usually is. If you want to learn more about Enhance, go check out their website, enhance.com, and do your own due diligence. By the way, the company starts trading tomorrow, May 8th, on the New York Stock Exchange under the ticker ENHA. >> But it's always like that. I mean, the the people who believes that the market is telling us the direction of the economy. I mean, you need to do two seconds of investigation for to to understand that that's wrong. I mean, if you look to as I just said before, the top in the NASDAQ in 2000, it was not at a point where the economy was strong. the you know everything tops at a point where where you know when when people believe that things are great in the uh economy because the NASDAQ is is strong or the talk stock market and then you'll find out oh that was actually not a good time for the economy like the stock market also in 2007 into the October top. So when people saying look to the stock market, look how strong it is. Well, actually look to it and understand that the kind of sentiment that you have right now where people are talking about that AI is going to change the world. It's going to and of course it will. And uh you're going to see now that we have potentially the the peace deal in Iran that's going to change everything. It's because they don't understand what where to look. Where they need to look is to the consumer side. And the consumer is 70% of the GDP. And if you look to everything else, it's all nice and fine, but it's all, you know, the the dessert only. This is the main course. The main course is the what is happening to the consumer. And and if you look to that, then there is not a lot to be to be happy about. I mean, you can just say that if you look to few few data points here, roughly twothirds of the household expects that, you know, there will be higher employ unemployment over the next year. And this is actually the worst reading we have had since the 1978. And we have seen the consumer confidence on the Michigan survey is is below what we saw in the great financial crisis. We have a new survey coming out here not which was on I think it was zero hedge also 55% of Americans say that their finances are getting worse and this is an all-time record high of that. The savings rates are now down to the 2005208 levels which are record lows and we say that you know around twothirds of household they describe themselves as living paycheck to paycheck this which is the worst we have ever seen and if you look to some other numbers also a 6,000 now dollar unexpected expense is at this point here sufficient to push the median family over the edge and you can go on with this there are so many data point telling us that things are not great with the consumer And yet you have the financial world sitting there in their ivory towers ivory towers and looking at the you know at the AI stuff and the earnings and everything else everything they've been looking for for years and being wrong about and then saying okay there's everything is great and now things are going to be changed. I mean it's just honestly I don't know what why this is so difficult because if you as I've said uh also uh a few times on another interview um you know if when you had a the disaster the challenger disaster in 200 1986 right and you had the Colombia disaster and you had the you know 911 when you have disasters like that you actually investigate and you sit you have you know people sitting down and trying to understand what went wrong why did we what we had this terrible disaster Nobody in the financial industry sits down and understand what went wrong. Why didn't we see the largest financial crisis we have seen and the largest recession we have seen in years in 2007. Nobody investigates that apparently and and when they do they jump back to this. Oh, but now we look at the same kind of metrics we did into the 2007 and where we missed everything and by the way we also used in 22 when everybody was so bearish on the economy. So I think the uh I don't know why it's it's like that in the financial industry that they don't do their stuff you know thoroughly but it's so clear it is so clear to see that this is not going to end well >> and very short-term memory as well. So very short investigate and very short-term memory, right? Um what what you just described keeps reminding me and bringing me back to that wonderful buzz word is the K-shaped economy, right? The poor are getting poorer and the richer are getting richer. There's that nice I don't know. Let's move it to the side there. Nice pattern. Um it it reminds me a bit of a what's that whipsawer thing that called you have you have on the playgrounds. Um but the question is like where's the tipping point? Right. Right now it seems to be in in balance, right? It sounds a bit unfair to the ones at the bottom, but it seems to be right for the ones at the top here. But when does that when when do we reach that tipping point, Henrik? Like when do we see okay, consumer confidence is already in the gutter. Um, but when is that tipping point reached? >> I pro it's probably difficult to see it on that particular chart. And what I what we need to see is that uh that at some point there's something that's going to break. So when people are saying, "Oh, that was a black swan event." I say, "Why was there a black swan event?" So when you look to the Bear Sterns for instance, which was in March of 2008, it was a black swan or the Lehman Brothers or whatever it's going to be. It's never a black swan because you it always happens. All black swans had they happened within a uh within a recession or within when when things are, you know, turning bad. So what you can ask yourself is when will the black swan come out? A counter example of of that actually when the black swan did not you know create a recession was in 2016 when we had the uh the UK referendum and they you know left the EU at least you know on the referendum that would have been enough in a in a weakening economy to push the economy over the edge but it's not in the strong economy that's not enough that cannot do it. So it's when is the another way to put this up in a kind of metaphor is when will the avalanche start to you know you know run down the hill there. What is the trig trigger? Is it is it the um is it the big bang or something like that? Is the the skier you know skiing down or what is it? Or will it be a snowflake just you know hitting the the surface and then will start to slide. It is about how fragile the the structure is beneath. And if we look at it right now with the economy, the economy is extremely fragile because the structure down beneath is the consumer. I don't know why people don't understand that that you know you cannot have an economy without having the consumer. And right now the as I just said with all the data point that I mentioned here and I got you know 20 more. This this is the worst economy for the consumer ever. So when will it happen? What will the black swan which we can expect at some point be at this time? Will it be some kind of institution starting to have problems with their customers? What will it be? And what will the domino be? We cannot we cannot tell. But there will be something because at some point the structure will be so fragile that it's going to run down the you know the the the the mountain there. So um I can't tell you I can tell you where I can see that there is a stock market potential top there. 8100 is one uh 34,000 on the NASDAQ could be uh what I could see as well. we could see a straight up kind of move here but the whole structure beneath is is not sound. Uh and I also know where to look at in terms of in the in the bond market. I know that we need to look at the yields coming down. We need to look to credit spreads going up and so on so forth. All these things they are not happening right now. But if you go from that point from that you know again standing there on the on the mountain and say okay you know there's there haven't been an avalanche here for weeks or for months there's no risk of an avalanche just go probably that's not what you want to do but that's what the way people think when it comes to the financial market they look back and say hey we haven't had it for weeks now and people have said it that the avalanche there is going to slide down a mountain at some point but it never did so I'll just start to move down the mountain you don't do that because you know that there is a risk that he could actually do. So that is the the the point we're at right now. So if we look to to when that will happen, well, you know, very few people will be able to actually call out the top in the stock market and it doesn't need to be the top in the stock market that defines when we're going to see the top when we're going to see that the avalanch is running. Remember again in 2008 when we had the market top, it was in October of 2007, but really people didn't feel it before September of 2008 when we had the Lehman Brothers situation. That's also the situation. It can go on for some time and the situation can become increasingly worse uh for some time before we actually see that happening in the stock market. But I can tell you for the the really consumer it will be about do I have a job right now. They're not being laid off in big quantities here. The moment that starts to happen and you can just look to the weekly claims um they're low. There can be reasons for that. I mean, if you are a, let's say, an immigrant have been living 20 years in the US, maybe not with the right kind of papers and all that, you're probably not going to go down and say, "Hey, you know, I'm I'm reporting in as a uh as an unemployed at this point. You're probably staying a little low uh low profile here, I would guess." So, when you look at that, they we we need to be careful about what we see in the initial claims, but the initial claims would normally be one of the things we could see, and they are really low at this point. So I'm I'm not sitting here and claiming that this is something that is going to play out right now right here. I say that this is something that can play out over the next uh you know the next few months here and uh and then at some point it's going to be very very clear that there is an avalanche and there is a lot of weakness in the structure. >> You know worried being labeled captain and obvious here but you're you're most concerned about the consumer. Is that uh maybe a fair fair statement? It's not really private credit. It's not the banks. It's not maybe the real estate market. It it is the consumer for you that has you most worried. Just to summarize. >> Yeah. But the consumer is also all of that. So by the end of the day, private credit is dependent on whatever facilities they have been setting off of consumers being able to pay off on their loans. And if you look to the, you know, delrances rates now going on of everything. I don't I don't think that all of the we also see the private credit started to to wobble. We don't know how big that is. I mean, I was in an interview yesterday and say, "Oh, it's not so big." And we don't know. It's in a dark room. I It's a, you know, back in 2007 and 8, we kind of had an idea of it how big it was because we had a uh we had it all on the balance sheet of the banks. Today, we don't have that. We don't know where this money has been shifting or going around the regulated areas. So, I think it's a much bigger problem. But by the end of the day, the the one who pays the buck, you know, is the consumer buying stuff. If they start to do less of that, it will impact businesses. It will impact, you know, the way they are capable of paying back their loans and so on. And the thing is, it's not just about one consumer or five. It's about that all of a sudden this is a, you know, big pack of consumers starting not being able to pay their off their loans and the mortgages or whatever. And it's going to impact a certain lender. That lender then will then, you know, trigger the next thing. And it might be a small one. and it will be the dominoes from the small domino to the bigger to the you know the really big ones and that is the the kind of we we cannot see that uh causality right now it's impossible we probably had a better ability to do that back in 2007 and 8 today with the structure the opaque structure we have on whole private credit it's almost impossible and I think that's also why it's going to be a more difficult crisis this time around but the consumer is every time the one thing that is going to be the problem and is going to be the one driving us into a crisis if they can't pay. >> Allow me one last question on the consumer. I find it fascinating because it is such a big factor of course um is the geopolitical uncertainty. Let's assume we have peace in the Middle East tomorrow. We have a signed treaty. It's somewhat airtight. Um we can figure out if it's fragile or not. But uh the how much of that geopolitical uncertainty is is in the consumer sentiment right now? Like gas prices are are going higher. you probably put off buying a boat, a jet ski or something, whatever it is, uh, to a later point, right? You you're not buying anything big right now because you're waiting for it to play out. How much of a factor is that? Let's assume oil price drops to back to $60, $40 perhaps, even in an overexaggeration. And the consumer says, "Okay, let's go out spending. It's the summer. I need a boat. I want to do this and that." Like, how much distortion is is in that based on the geopolitical events that we've seen? Of course, the geopolitical events are the things the developments there are are important. They I mean they they they cause the oil to spike and um unfortunately it seems like people are getting this wrong because then they're saying oh that's going to create inflation. Inflation comes out when the economy is strong when the consumer is strong because then they will start to spend. So in 22 when we had inflation going up uh it was because we had we were all you know everybody had a saving or a check in their hands because of what we saw after COVID and we were spending like crazy and everybody had good business uh based on that. Today the situation as I just said with the consumer is quite is quite in different position. So when we see an oil spike like this, a supply driven spike, it's not inflationary, it's deflationary. And that's where you have that this can actually impact the consumer because the consumer has to buy a certain amount of uh you know petrol or you know whatever whatever it's going to be for for their car um gasoline for their car you know every week, every month and uh to go to work or whatever they do. They of course can cut back on this but they've also cut back on other things. So when things are getting more expensive there is this income effect for us all that there are certain necessities we have to buy every month and if it becomes more expensive it will be harder for us to buy other stuff that's you know simple budget I mean it's it's easy for us to understand this is the kind of you know grand my my my grandmother if she was alive she would understand but it's not um apparently not what the financial world understands so when the when the economy sees a supply ch supply shock like this on on oil it go prices goes up this is not inflation It's deflationary. It pushes down things. Yes, it will push out the things that we'll buy, but I'm not so worried about the people who will not buy the jet skis. I'm worried the ones who says, "Well, you know, this will probably mean that we'll have to then push the payment of uh whatever kind of bill to the next month." And remember that is the 70% of the US economy. It's not the consumer takes out 70%. and the amount of people who where the next as I just said before twothirds of the US consumer are saying themselves that they live paycheck to paycheck. So if they all of a sudden have to, you know, spend extra $100 a month or whatever it is on gasoline because they have to go to work, they have to do whatever it is, then that's a big deal. And a $6,000, as I said, extra, you know, a car bill or whatever can the car breaks down will push them over the edge. That is not a strong economy. And that's why I am not worried about the jet ski guys because they are in the top 10. >> That was a poor example. That jet ski was a poor example. >> No, no, no, no, no. But but it's No, no. It's actually but Kai actually I think is a great example because I think sometimes it's it's what we think oh well we'll just you know we not go on that vacation or we'll not do that that's not the real world the real world will become of the will be the people where this is you know the difference between uh actually making uh or just actually you're surviving almost right >> yeah no exactly it's whether you can buy or afford that the car that gets you to work right as as you pointed out >> exactly exactly yeah >> um no fantastic I think we we understand your macro thesis let's cycle through the asset classes a little it. So I your your S&P 500 target is about 8,100. Okay. So we we we we can check that one off. But you mentioned bonds as well, the bond market. Like do you have any uh targets for for the 10-year yield in the US? Like what what are you expecting here? >> Um I don't have any levels there, but I I do have that when when the economy slows, you will see the bonds start to rally at some point. And I think you're going to see at the the short end will start to kick off first and they'll start to decline. Not again what we hear. we hear we hear about these doomsday kind of thinking that because yields are p have been pushing higher then it's going to be now everything is bad is with like the yields like with the stock market is that at some point there will be a top and you'll see it they come down quite strongly and especially if you have a a slowdown of the economy so I don't have levels uh with that I don't I mean that's not so important for me it's the direction of things and the direction is here that we are getting closer and closer to the where we should see a very strong decline in in in in in the yields. I mean there could be a little bike higher uh short term on the on the short end and the long end will follow what the short end does um also when we start to see the decline. So I expect all this weakness in the economy to start flowing into to start showing in the um in the bond markets as well and you would see that the bonds would start to to do well. We're not right there yet but I think we are getting close. >> Okay. No, fair enough. And let's continue cycling through because I do want to get to gold and silver here in a second as well. I'm I'm dangling the carrot a little bit for our audience. But before we do that, let's talk US dollar as well. Um people have been talking about the death of the dollar, of course, for for years. Um where do we stand? Where's the dollar? Is it still the the cleanest shirt in the hamper? >> 100%. 100%. And I I I say that we and this mark my words the next few weeks, months here, you're going to hear people talk about the death of the dollar once more and you're going to hear why that's going to drive uh the debasement and the uh whatever people are going to call it. And uh because Dixie is probably going to go a little lower here and I think we would see 92ish on the dollar on the Dixie and uh if we do that that will be supportive of that risk on rally that we we uh currently in and for as long as we see that I think all good is we all good and fine. It'll be interesting to see when when we hit that bottom uh what happens then. Um everything that you know thrives in a poor in a weak dollar world which is you know a lot of things but especially crypto and gold and silver and so on will probably have a you know a good time here for for that that kind of duration. Um but I still say that the development you're going to see into a uh a crisis like what I'm suggesting we could be heading into is not that you should be expecting the dollar to decline. you should be expecting quite the opposite which is a very very strong dollar and a dollar that's going to surpass anything that people will will expect at this point here. It's going to be the wrecking ball of the world at at that point but for now shortterm few more months we're going to see a weakening dollar and you're going to hear the dollar is dying kind of sentiment as I see it. >> Okay. Yeah. No, interesting. And I kind of follow that logic because if if the world really like hits the the recession, I don't know, glo if we do hit a recession globally, then the dollar will be seen as probably one of the cleanest or most liquid and maybe as a safe haven um assets here in in in general. Um Henry, you already >> also also the fact that simply that a lot of the defaults and so on and as as a majority of the world is kind of short the dollar or has you know the the loans in in in dollars denominated in dollars, you'll see that there is a need for that. So even in a negative world where we don't like the dollar so much and not a safe haven all that you need it to simply just you know get these uh loans out the world for the whatever kind of you know um solution you're going to find for whether it's bankruptcy or whatever it's going to be. >> Yeah. Well we've seen that at the beginning of of March here uh when the the war broke out in the Middle East that people ran towards the dollar. We we we've seen that. So that's exactly that thesis playing out. Um you you touched on it and I want to go there now next is really gold and silver. the precious metals another asset class assumed a safe haven investment of course as well. What what do you make of the precious metals right now especially given the backdrop of the last maybe 48 hours as well and then of course projecting forward. >> I think the weak dollar setup is going to uh make um make the case for that we can have at least a bounce in uh in in uh in in precious metals here. And uh I'll be a little more hesitant whether we're going to see a new alltime high. I think that there on the especially when you look to silver on the technical side you can see that there are uh a lot of technical evidence that we have only seen a beginning of a larger decline. Um but I will air to the cautious side here and say well it's for now I think it's we're going to see a bounce and the bounce can be quite strong like what I expect also with Bitcoin which I also think is only in a in a bounce and uh people will still start to throg into it and say yeah this is the this is the new rally and now we're going higher. That's the sentiment again we need in order for things to uh to unfold. Now with gold and silver, I didn't see the spike like what we've seen here. So I have to air to the cautious side and uh see that things can go even higher. But again, technically it doesn't look good for for silver. And I would find it hard to see that gold would just push on if silver had a larger uh correction. And it would make sense that we see a bounce into this kind of phase here where we then also have that risk on rally and uh which we didn't really have to the same degree at least in in crypto which I think we can head into it now as well. Uh the the riskon rally can head into it at this point. So I think the gold and silver situation will be that a bounce shortterm but I would be very careful if I if I get the dollar direction correctly it will be there will be a very strong pullback. What what are gold and silver correlating right now too? Like we used to say okay US dollar down, gold up. That was a very simple like that that used to work really really well. Is that correlation still true though? Like I'm guessing it might be but there are other factors at play now for gold and silver I would assume um that could pull it in either direction and I'm curious like are those those correlations that we used in in the past still valid though? >> Yeah but correlation are there for a reason. It's not like it's just a mathematical thing that there is correlation if and then then it's not there. There can be weaker and stronger correlation for certain periods. But you can ask yourself in a situation where the dollar starts to head up because we had a recession and we see the dollar going from let's say 92 if I we get it down there and we can hit as hard and high as um 120 which I think is a possibility on the on the dollar. uh not in immediate too long but it will take a it take a while to get there but in in a year year and a half two years maybe uh you could see that kind of level um what will people do then what will happen in the world being if the dollar rise rises rises like that you're going to see that there will be a lot of downward pressure on the economy this is not something emerging markets are going to like this is not something that a lot of things is going to like I mean a lot of institutions and so on this is this will be a you know push uh downward pressure on the on the markets. The dollar always acts like that and they will you will probably only see that kind of move in a in a liquidity kind of crunch uh which would also be a normal effect of a bubble bursting where we we have a bubble in the stock market. There's no doubt about that. So um I just think you know if that happens and you need cash why is it then that gold will do fantastic in that period? I you know gold and silver I I just you know fail to see why that will be the case. So I would say the the the correlation is there. It's sometimes weaker and sometimes stronger. But I would think that in a in a recessionary situation uh where we have a bubble bursting, it's going to be one of the stronger ones. But it'll be more because not because that particular correlation between gold and gold and the dollar, but more in general because it will be about getting cash. It'll be about being liquid and it'll be about being able to pay off your debt or whatever it is. And you don't hold, you know, you don't do that with gold. You do that with by selling gold to get dollars and then you sell your your euro. So let's see. Let's see what happens. I mean, people are so emotional when it comes to this. And the same goes with Bitcoin and they can see it declining and um I think we haven't seen a very very strong dollar for some time. And that's that's the thing. I mean, when we see strong dollar, everybody can agree. And you know, well, okay, this is this is bad. But uh but when you have the dollars declining from I don't know what 110 down to 92, it's obviously a good time for for gold and silver and for for for crypto also and uh and I think we're going to see a little more of that. But the strong dollar is not going to be nice to uh commodities. >> No, fantastic. Henrik, maybe allow me last final question, maybe summarize the conversation a little bit. Is if you were to find a million dollars underneath your couch cushion, how would you allocate that capital right now? And just assume it's not investment advice for anybody. Everybody's different, right? So, full disclaimer here, but I'm curious how you would allocate that capital today. >> Well, I I you know, it depends again on the on the time frame here, but if you >> you said it, it's it's your money. >> The time the time Yeah, the time frame, you know, matters obviously here. And uh you would say I would say that it's uh I would be very risk as I as I said earlier also and I am and I am very position like in for also for a crypto rally, for Ethereum rally. I think the we're going to see now a situation where gold is starting to be outperformed as we've seen actually by by Bitcoin uh for some time now. I think it's going to intensify. I think the same thing will be Ethereum and Ethereum actually will uh in a little short time more here then we'll see Ethereum actually outperforming Bitcoin. And if that's the case uh and uh well with the targets I have for Ethereum which is about 10,000 on Ethereum well then you're going to see a lot of these DAT companies that have been accumulating Ethereum uh which would be a great great place to be and that's where that's what I'm holding right now. So I probably would be putting more into that and the reason is simply that there will always be this kind of euphoric rally that we are now starting to see the the the the first phase off in the in the NASDAQ and the S&P that will rotate into other places as well and then you're going to see um yeah these these potentially companies doing well but that would only be a play for let's say a couple of months or you know after that I will be liquid. I would be in something that you know that would probably be if I had to then buy some TLTs and the likes because you know I think the the the yields could coming down quite strongly and uh and we could see that um the the dollar strengthening as well also. So so that would be the case and then later on when we see the Fed coming in I would be and I'll be glad you know to talk to you at that point and that will be all about precious metals it will be all about the gold miners and the likes and it will be all about commodities. No, fantastic. We we'll definitely have you back on when that happens. So, which could be any day. We never know. We'll see what Kevin Walsh does. They're already um you know printing money more or less. They ejected $600 billion into the economy already indirectly and directly. So, another topic for another day. Henrik, tremendously appreciate you joining us again. Always a pleasure. Um where can our audience follow more of your work? >> Well, first of all, I'm on on uh on X at Henrik Seberg. I'm also on Substack at Henrik Zeber and also if we want if you're an institutional um you know uh client you can also go to our SEM services which is where I you know every week I update our clients on on the direction of the markets and on the economy and uh yeah so so these pretty much the places to find me. >> Fantastic. Awesome. Henrik, thank you so much for joining us again. A pleasure to chat. Can't wait to do this again hopefully like when uh you know positive gold and silver environment. Always enjoy that. Of course, uh that's that's our our bread and butter business here, of course. So, really appreciate it, Henry. Thanks so much for coming on and everybody else, thanks so much for tuning in. Really appreciate you watching Sore Financially if you haven't done so. Hit that like and subscribe button and of course, let us know how are you positioned right now. Are you risk like Henrik is or are you risk off? Like, meaning are you maybe more conservative? Are you more concerned about the economy and the markets potentially uh going sideways on you? I'm really curious what what you think. Put that down below. Thanks so much for tuning in. And don't forget, don't let your emotions run your investments for you. Take care.
Final BLOW-OFF TOP: Stocks & Crypto Rally Before the Crash | Henrik Zeberg
Summary
Transcript
at some point there's something that's going to break. So when people are saying, "Oh, that was a black swan event." I say, "Why was there a black swan event?" I don't I don't think that all of the We also see the private credit started to to wobble. We don't know how big that is. I mean, I was in an interview yesterday and say, "Oh, it's not so big." And we don't know. It's in a dark room. I It's a you know, back in 2007 and 8, we kind of had an idea of it how big it was because we had a uh we had it all on the balance sheet of the banks. Today, we don't have that. Renewed news of a peace deal in the Middle East have sent stock the stock market, commodities flying higher. The S&P 500 has been trading at record levels for over a week now. And uh is this just the the final phase in the melt in in the in the meltup? Is this the blowoff top we've been expecting to see? What does it really mean? Like what phase are we in right now? Let's let's take a look at the economic data. Let's take a look at commodities. Let's take a look at crypto. We'll throw a Bitcoin question into the conversation here today as well. My guest today is Henrik Zeberg. I'm really excited to have him back. Uh I really enjoy our conversations and controversial thinking sometimes, but it is refreshing and I enjoy it. So really looking forward to having this conversation with Henrik today. But before I switch over to my guest, hit that like and subscribe button. It helps us out tremendously and we really really appreciate it. Now Henrik, thank you so much for joining us again. It's great to have you back on. Thanks so much. Thank you for having me on again today. Kai, >> yeah, really looking forward to the conversation, Henrik, and uh can't wait to dissect what is happening in the markets with you because I'm I'm getting so many mixed signals. Um, personally, I always thought we were we'd be closer to a crash than ever before, but the markets are telling a very different story, especially looking at maybe the main indices. Uh, everything seems to be honky dory. Let's let's start high level. Henrik, what's your initial assessment here? Well, I mean, four or five weeks ago, I was uh very l you know, lonely in the in the bulls camp. I think there were obviously there is always others, but uh but on Twitter or in X, I was saying that this is not the thing. This is not yet. We're not there. And uh even though I am this is where you're, you know, insanely bullish, but also insanely bearish at the same time. It's uh where people sometimes might not understand but understanding that in a certain time frame when we have a let's say the next uh I don't know a few months here uh you would see that uh the stock market could do really well and uh this is not because the economy is strong this is because that is what happens into the final phase of a uh of a bull market first of all and of also what happens into the into a topping uh business uh cycle. So everything is actually playing out quite nicely here. I I for me I mean if you were expecting the drop here in that this was be would be the top. You would be surprised now and then people say oh we don't understand what's going on. If you were expected that also last year in April and saying oh this is the top and you know I was there out out there again and saying no that's this is not it. Um then of course you would start to be what's going on. But it's not so difficult actually what you need to look to is the real economy and the real economy is slowing. It's not to the point yet where we where we should be worried about an imminent recession, but you'd say it's definitely getting closer and there is structural setup where you look to the as again as I say the real economy and this is not about earnings and this is not about AI and this is definitely not about Iran but the real economy the consumers the boring stuff of the economy that is they the consumers probably at the worst place we have ever seen them in the US and also elsewhere in the world and this is not what what is the headlines of the on the news and in the media uh probably because it's boring and I don't know what it's much more you know interesting to talk about Nvidia's earnings or something. >> No absolutely no lots going on but uh maybe just to to maybe put a frame framework around it like what phase in the meltup are we in right now? Is this more the end? Is this the beginning? Like I'm just curious like what what what is your data telling you? >> Oh, we are in the I call it the wave five. This is the final move. This is the this is the move into the top. And that's why I also a few weeks ago and to our clients also I said this is going to be a straightup thing. You're going to see like in 2000 when we had the biggest tech bubble at any point until that point you saw from the January of 2000 until the top in March uh six weeks six weeks you saw a 45% move. That is what I was calling for just some weeks ago and I said this is that the setup we have right now is uh wave four bottom we're going to see in a bigger setup. It's, you know, difficult to try to see here sit here and trying to tell how what the market looks like. But that was the bottom we saw there in on March 30th and then we saw the explosion higher which is always a very very powerful move. It goes straight up then there is a correction and everybody will become bearish again. You know, mark my words, we will have a pullback and it'll be severe and strong within the next few weeks here and then people will say oh this is it. The bears will come out again and say we are doomed now. And then it will turn one more time and go up even stronger into that final top. And that will be the one that top will be the one where everybody then has been turning bearish bullish bearish bullish and that to the point where they're simply just you know cap capitulate and and and say okay the market is just too strong and we're going to go higher. That is why sentiment and psychology in the markets is so difficult. But study that and you'll see that this is exactly what we need for people to be on the wrong side. So first up down up we're there. You and David Hunter have a very similar thesis on in in that regard, I believe. So, he he's calling for 8,100, I believe, in the S&P 500 if I'm not mistaken. Hope I'm not misquoting. So, I think it sounds like we're on track to to hit that number, right? Um >> I didn't I honestly I know that the he's talking about that I steal his stuff. I don't follow the guy, but I understand that the 8100s. That's interesting because I have the same number. So, that's quite interesting. >> Yeah, I I think it was 8100. Don't exactly quote my I interviewed him late last week and I I should look it up. I should know better. But uh um Henry before we move on like actually interesting question like you you just mentioned it as well psychology like why is it that in a final phase of a market there is that blowoff rally like where does the excitement come from? help us understand the psychology or the psychology behind that final blowoff move. Like as you as you said, the real economy might already be crumbling, but the market is still rallying. Like where does the market get the excitement from and help us understand maybe from a psych psychological point of view what that means? Before we continue, let's talk about a company that is challenging the status quo in a very controversial but a very calculated way. Enhanced, currently trading under NASDAQ APA and set to become ENHA, is building what they call the next generation of global sport. But this is just not another competition. Enhanced Games is positioning itself as a modern era alternative to traditional events like the Olympics, except with record level athlete compensation, full transparency, and top tier medical oversight. They're asking a simple but uncomfortable question. What if performance enhancement already exists in elite sport? And instead of pretending it doesn't, you bring it into the open, regulate it, measure it, and supervise it scientifically. Their model puts doctors, data, and athlete health at the center. The chairman recently called it a paradigm shift, focusing on recovery, long-term well-being, and protecting careers rather than stigmatizing enhancement. Now, here's where it gets interesting from a business standpoint. The games themselves are just the front end. The real opportunity may be the broader consumer platform. enhanced plans to launch teleaalth and scienceback performance and recovery products in Q126, bringing elite level oversight to everyday athletes, longevity enthusiasts, and people who simply want to optimize their health. This is a convergence of sport, biotech, longevity, and consumer health. And yes, it's controversial, but disruption usually is. If you want to learn more about Enhance, go check out their website, enhance.com, and do your own due diligence. By the way, the company starts trading tomorrow, May 8th, on the New York Stock Exchange under the ticker ENHA. >> But it's always like that. I mean, the the people who believes that the market is telling us the direction of the economy. I mean, you need to do two seconds of investigation for to to understand that that's wrong. I mean, if you look to as I just said before, the top in the NASDAQ in 2000, it was not at a point where the economy was strong. the you know everything tops at a point where where you know when when people believe that things are great in the uh economy because the NASDAQ is is strong or the talk stock market and then you'll find out oh that was actually not a good time for the economy like the stock market also in 2007 into the October top. So when people saying look to the stock market, look how strong it is. Well, actually look to it and understand that the kind of sentiment that you have right now where people are talking about that AI is going to change the world. It's going to and of course it will. And uh you're going to see now that we have potentially the the peace deal in Iran that's going to change everything. It's because they don't understand what where to look. Where they need to look is to the consumer side. And the consumer is 70% of the GDP. And if you look to everything else, it's all nice and fine, but it's all, you know, the the dessert only. This is the main course. The main course is the what is happening to the consumer. And and if you look to that, then there is not a lot to be to be happy about. I mean, you can just say that if you look to few few data points here, roughly twothirds of the household expects that, you know, there will be higher employ unemployment over the next year. And this is actually the worst reading we have had since the 1978. And we have seen the consumer confidence on the Michigan survey is is below what we saw in the great financial crisis. We have a new survey coming out here not which was on I think it was zero hedge also 55% of Americans say that their finances are getting worse and this is an all-time record high of that. The savings rates are now down to the 2005208 levels which are record lows and we say that you know around twothirds of household they describe themselves as living paycheck to paycheck this which is the worst we have ever seen and if you look to some other numbers also a 6,000 now dollar unexpected expense is at this point here sufficient to push the median family over the edge and you can go on with this there are so many data point telling us that things are not great with the consumer And yet you have the financial world sitting there in their ivory towers ivory towers and looking at the you know at the AI stuff and the earnings and everything else everything they've been looking for for years and being wrong about and then saying okay there's everything is great and now things are going to be changed. I mean it's just honestly I don't know what why this is so difficult because if you as I've said uh also uh a few times on another interview um you know if when you had a the disaster the challenger disaster in 200 1986 right and you had the Colombia disaster and you had the you know 911 when you have disasters like that you actually investigate and you sit you have you know people sitting down and trying to understand what went wrong why did we what we had this terrible disaster Nobody in the financial industry sits down and understand what went wrong. Why didn't we see the largest financial crisis we have seen and the largest recession we have seen in years in 2007. Nobody investigates that apparently and and when they do they jump back to this. Oh, but now we look at the same kind of metrics we did into the 2007 and where we missed everything and by the way we also used in 22 when everybody was so bearish on the economy. So I think the uh I don't know why it's it's like that in the financial industry that they don't do their stuff you know thoroughly but it's so clear it is so clear to see that this is not going to end well >> and very short-term memory as well. So very short investigate and very short-term memory, right? Um what what you just described keeps reminding me and bringing me back to that wonderful buzz word is the K-shaped economy, right? The poor are getting poorer and the richer are getting richer. There's that nice I don't know. Let's move it to the side there. Nice pattern. Um it it reminds me a bit of a what's that whipsawer thing that called you have you have on the playgrounds. Um but the question is like where's the tipping point? Right. Right now it seems to be in in balance, right? It sounds a bit unfair to the ones at the bottom, but it seems to be right for the ones at the top here. But when does that when when do we reach that tipping point, Henrik? Like when do we see okay, consumer confidence is already in the gutter. Um, but when is that tipping point reached? >> I pro it's probably difficult to see it on that particular chart. And what I what we need to see is that uh that at some point there's something that's going to break. So when people are saying, "Oh, that was a black swan event." I say, "Why was there a black swan event?" So when you look to the Bear Sterns for instance, which was in March of 2008, it was a black swan or the Lehman Brothers or whatever it's going to be. It's never a black swan because you it always happens. All black swans had they happened within a uh within a recession or within when when things are, you know, turning bad. So what you can ask yourself is when will the black swan come out? A counter example of of that actually when the black swan did not you know create a recession was in 2016 when we had the uh the UK referendum and they you know left the EU at least you know on the referendum that would have been enough in a in a weakening economy to push the economy over the edge but it's not in the strong economy that's not enough that cannot do it. So it's when is the another way to put this up in a kind of metaphor is when will the avalanche start to you know you know run down the hill there. What is the trig trigger? Is it is it the um is it the big bang or something like that? Is the the skier you know skiing down or what is it? Or will it be a snowflake just you know hitting the the surface and then will start to slide. It is about how fragile the the structure is beneath. And if we look at it right now with the economy, the economy is extremely fragile because the structure down beneath is the consumer. I don't know why people don't understand that that you know you cannot have an economy without having the consumer. And right now the as I just said with all the data point that I mentioned here and I got you know 20 more. This this is the worst economy for the consumer ever. So when will it happen? What will the black swan which we can expect at some point be at this time? Will it be some kind of institution starting to have problems with their customers? What will it be? And what will the domino be? We cannot we cannot tell. But there will be something because at some point the structure will be so fragile that it's going to run down the you know the the the the mountain there. So um I can't tell you I can tell you where I can see that there is a stock market potential top there. 8100 is one uh 34,000 on the NASDAQ could be uh what I could see as well. we could see a straight up kind of move here but the whole structure beneath is is not sound. Uh and I also know where to look at in terms of in the in the bond market. I know that we need to look at the yields coming down. We need to look to credit spreads going up and so on so forth. All these things they are not happening right now. But if you go from that point from that you know again standing there on the on the mountain and say okay you know there's there haven't been an avalanche here for weeks or for months there's no risk of an avalanche just go probably that's not what you want to do but that's what the way people think when it comes to the financial market they look back and say hey we haven't had it for weeks now and people have said it that the avalanche there is going to slide down a mountain at some point but it never did so I'll just start to move down the mountain you don't do that because you know that there is a risk that he could actually do. So that is the the the point we're at right now. So if we look to to when that will happen, well, you know, very few people will be able to actually call out the top in the stock market and it doesn't need to be the top in the stock market that defines when we're going to see the top when we're going to see that the avalanch is running. Remember again in 2008 when we had the market top, it was in October of 2007, but really people didn't feel it before September of 2008 when we had the Lehman Brothers situation. That's also the situation. It can go on for some time and the situation can become increasingly worse uh for some time before we actually see that happening in the stock market. But I can tell you for the the really consumer it will be about do I have a job right now. They're not being laid off in big quantities here. The moment that starts to happen and you can just look to the weekly claims um they're low. There can be reasons for that. I mean, if you are a, let's say, an immigrant have been living 20 years in the US, maybe not with the right kind of papers and all that, you're probably not going to go down and say, "Hey, you know, I'm I'm reporting in as a uh as an unemployed at this point. You're probably staying a little low uh low profile here, I would guess." So, when you look at that, they we we need to be careful about what we see in the initial claims, but the initial claims would normally be one of the things we could see, and they are really low at this point. So I'm I'm not sitting here and claiming that this is something that is going to play out right now right here. I say that this is something that can play out over the next uh you know the next few months here and uh and then at some point it's going to be very very clear that there is an avalanche and there is a lot of weakness in the structure. >> You know worried being labeled captain and obvious here but you're you're most concerned about the consumer. Is that uh maybe a fair fair statement? It's not really private credit. It's not the banks. It's not maybe the real estate market. It it is the consumer for you that has you most worried. Just to summarize. >> Yeah. But the consumer is also all of that. So by the end of the day, private credit is dependent on whatever facilities they have been setting off of consumers being able to pay off on their loans. And if you look to the, you know, delrances rates now going on of everything. I don't I don't think that all of the we also see the private credit started to to wobble. We don't know how big that is. I mean, I was in an interview yesterday and say, "Oh, it's not so big." And we don't know. It's in a dark room. I It's a, you know, back in 2007 and 8, we kind of had an idea of it how big it was because we had a uh we had it all on the balance sheet of the banks. Today, we don't have that. We don't know where this money has been shifting or going around the regulated areas. So, I think it's a much bigger problem. But by the end of the day, the the one who pays the buck, you know, is the consumer buying stuff. If they start to do less of that, it will impact businesses. It will impact, you know, the way they are capable of paying back their loans and so on. And the thing is, it's not just about one consumer or five. It's about that all of a sudden this is a, you know, big pack of consumers starting not being able to pay their off their loans and the mortgages or whatever. And it's going to impact a certain lender. That lender then will then, you know, trigger the next thing. And it might be a small one. and it will be the dominoes from the small domino to the bigger to the you know the really big ones and that is the the kind of we we cannot see that uh causality right now it's impossible we probably had a better ability to do that back in 2007 and 8 today with the structure the opaque structure we have on whole private credit it's almost impossible and I think that's also why it's going to be a more difficult crisis this time around but the consumer is every time the one thing that is going to be the problem and is going to be the one driving us into a crisis if they can't pay. >> Allow me one last question on the consumer. I find it fascinating because it is such a big factor of course um is the geopolitical uncertainty. Let's assume we have peace in the Middle East tomorrow. We have a signed treaty. It's somewhat airtight. Um we can figure out if it's fragile or not. But uh the how much of that geopolitical uncertainty is is in the consumer sentiment right now? Like gas prices are are going higher. you probably put off buying a boat, a jet ski or something, whatever it is, uh, to a later point, right? You you're not buying anything big right now because you're waiting for it to play out. How much of a factor is that? Let's assume oil price drops to back to $60, $40 perhaps, even in an overexaggeration. And the consumer says, "Okay, let's go out spending. It's the summer. I need a boat. I want to do this and that." Like, how much distortion is is in that based on the geopolitical events that we've seen? Of course, the geopolitical events are the things the developments there are are important. They I mean they they they cause the oil to spike and um unfortunately it seems like people are getting this wrong because then they're saying oh that's going to create inflation. Inflation comes out when the economy is strong when the consumer is strong because then they will start to spend. So in 22 when we had inflation going up uh it was because we had we were all you know everybody had a saving or a check in their hands because of what we saw after COVID and we were spending like crazy and everybody had good business uh based on that. Today the situation as I just said with the consumer is quite is quite in different position. So when we see an oil spike like this, a supply driven spike, it's not inflationary, it's deflationary. And that's where you have that this can actually impact the consumer because the consumer has to buy a certain amount of uh you know petrol or you know whatever whatever it's going to be for for their car um gasoline for their car you know every week, every month and uh to go to work or whatever they do. They of course can cut back on this but they've also cut back on other things. So when things are getting more expensive there is this income effect for us all that there are certain necessities we have to buy every month and if it becomes more expensive it will be harder for us to buy other stuff that's you know simple budget I mean it's it's easy for us to understand this is the kind of you know grand my my my grandmother if she was alive she would understand but it's not um apparently not what the financial world understands so when the when the economy sees a supply ch supply shock like this on on oil it go prices goes up this is not inflation It's deflationary. It pushes down things. Yes, it will push out the things that we'll buy, but I'm not so worried about the people who will not buy the jet skis. I'm worried the ones who says, "Well, you know, this will probably mean that we'll have to then push the payment of uh whatever kind of bill to the next month." And remember that is the 70% of the US economy. It's not the consumer takes out 70%. and the amount of people who where the next as I just said before twothirds of the US consumer are saying themselves that they live paycheck to paycheck. So if they all of a sudden have to, you know, spend extra $100 a month or whatever it is on gasoline because they have to go to work, they have to do whatever it is, then that's a big deal. And a $6,000, as I said, extra, you know, a car bill or whatever can the car breaks down will push them over the edge. That is not a strong economy. And that's why I am not worried about the jet ski guys because they are in the top 10. >> That was a poor example. That jet ski was a poor example. >> No, no, no, no, no. But but it's No, no. It's actually but Kai actually I think is a great example because I think sometimes it's it's what we think oh well we'll just you know we not go on that vacation or we'll not do that that's not the real world the real world will become of the will be the people where this is you know the difference between uh actually making uh or just actually you're surviving almost right >> yeah no exactly it's whether you can buy or afford that the car that gets you to work right as as you pointed out >> exactly exactly yeah >> um no fantastic I think we we understand your macro thesis let's cycle through the asset classes a little it. So I your your S&P 500 target is about 8,100. Okay. So we we we we can check that one off. But you mentioned bonds as well, the bond market. Like do you have any uh targets for for the 10-year yield in the US? Like what what are you expecting here? >> Um I don't have any levels there, but I I do have that when when the economy slows, you will see the bonds start to rally at some point. And I think you're going to see at the the short end will start to kick off first and they'll start to decline. Not again what we hear. we hear we hear about these doomsday kind of thinking that because yields are p have been pushing higher then it's going to be now everything is bad is with like the yields like with the stock market is that at some point there will be a top and you'll see it they come down quite strongly and especially if you have a a slowdown of the economy so I don't have levels uh with that I don't I mean that's not so important for me it's the direction of things and the direction is here that we are getting closer and closer to the where we should see a very strong decline in in in in in the yields. I mean there could be a little bike higher uh short term on the on the short end and the long end will follow what the short end does um also when we start to see the decline. So I expect all this weakness in the economy to start flowing into to start showing in the um in the bond markets as well and you would see that the bonds would start to to do well. We're not right there yet but I think we are getting close. >> Okay. No, fair enough. And let's continue cycling through because I do want to get to gold and silver here in a second as well. I'm I'm dangling the carrot a little bit for our audience. But before we do that, let's talk US dollar as well. Um people have been talking about the death of the dollar, of course, for for years. Um where do we stand? Where's the dollar? Is it still the the cleanest shirt in the hamper? >> 100%. 100%. And I I I say that we and this mark my words the next few weeks, months here, you're going to hear people talk about the death of the dollar once more and you're going to hear why that's going to drive uh the debasement and the uh whatever people are going to call it. And uh because Dixie is probably going to go a little lower here and I think we would see 92ish on the dollar on the Dixie and uh if we do that that will be supportive of that risk on rally that we we uh currently in and for as long as we see that I think all good is we all good and fine. It'll be interesting to see when when we hit that bottom uh what happens then. Um everything that you know thrives in a poor in a weak dollar world which is you know a lot of things but especially crypto and gold and silver and so on will probably have a you know a good time here for for that that kind of duration. Um but I still say that the development you're going to see into a uh a crisis like what I'm suggesting we could be heading into is not that you should be expecting the dollar to decline. you should be expecting quite the opposite which is a very very strong dollar and a dollar that's going to surpass anything that people will will expect at this point here. It's going to be the wrecking ball of the world at at that point but for now shortterm few more months we're going to see a weakening dollar and you're going to hear the dollar is dying kind of sentiment as I see it. >> Okay. Yeah. No, interesting. And I kind of follow that logic because if if the world really like hits the the recession, I don't know, glo if we do hit a recession globally, then the dollar will be seen as probably one of the cleanest or most liquid and maybe as a safe haven um assets here in in in general. Um Henry, you already >> also also the fact that simply that a lot of the defaults and so on and as as a majority of the world is kind of short the dollar or has you know the the loans in in in dollars denominated in dollars, you'll see that there is a need for that. So even in a negative world where we don't like the dollar so much and not a safe haven all that you need it to simply just you know get these uh loans out the world for the whatever kind of you know um solution you're going to find for whether it's bankruptcy or whatever it's going to be. >> Yeah. Well we've seen that at the beginning of of March here uh when the the war broke out in the Middle East that people ran towards the dollar. We we we've seen that. So that's exactly that thesis playing out. Um you you touched on it and I want to go there now next is really gold and silver. the precious metals another asset class assumed a safe haven investment of course as well. What what do you make of the precious metals right now especially given the backdrop of the last maybe 48 hours as well and then of course projecting forward. >> I think the weak dollar setup is going to uh make um make the case for that we can have at least a bounce in uh in in uh in in precious metals here. And uh I'll be a little more hesitant whether we're going to see a new alltime high. I think that there on the especially when you look to silver on the technical side you can see that there are uh a lot of technical evidence that we have only seen a beginning of a larger decline. Um but I will air to the cautious side here and say well it's for now I think it's we're going to see a bounce and the bounce can be quite strong like what I expect also with Bitcoin which I also think is only in a in a bounce and uh people will still start to throg into it and say yeah this is the this is the new rally and now we're going higher. That's the sentiment again we need in order for things to uh to unfold. Now with gold and silver, I didn't see the spike like what we've seen here. So I have to air to the cautious side and uh see that things can go even higher. But again, technically it doesn't look good for for silver. And I would find it hard to see that gold would just push on if silver had a larger uh correction. And it would make sense that we see a bounce into this kind of phase here where we then also have that risk on rally and uh which we didn't really have to the same degree at least in in crypto which I think we can head into it now as well. Uh the the riskon rally can head into it at this point. So I think the gold and silver situation will be that a bounce shortterm but I would be very careful if I if I get the dollar direction correctly it will be there will be a very strong pullback. What what are gold and silver correlating right now too? Like we used to say okay US dollar down, gold up. That was a very simple like that that used to work really really well. Is that correlation still true though? Like I'm guessing it might be but there are other factors at play now for gold and silver I would assume um that could pull it in either direction and I'm curious like are those those correlations that we used in in the past still valid though? >> Yeah but correlation are there for a reason. It's not like it's just a mathematical thing that there is correlation if and then then it's not there. There can be weaker and stronger correlation for certain periods. But you can ask yourself in a situation where the dollar starts to head up because we had a recession and we see the dollar going from let's say 92 if I we get it down there and we can hit as hard and high as um 120 which I think is a possibility on the on the dollar. uh not in immediate too long but it will take a it take a while to get there but in in a year year and a half two years maybe uh you could see that kind of level um what will people do then what will happen in the world being if the dollar rise rises rises like that you're going to see that there will be a lot of downward pressure on the economy this is not something emerging markets are going to like this is not something that a lot of things is going to like I mean a lot of institutions and so on this is this will be a you know push uh downward pressure on the on the markets. The dollar always acts like that and they will you will probably only see that kind of move in a in a liquidity kind of crunch uh which would also be a normal effect of a bubble bursting where we we have a bubble in the stock market. There's no doubt about that. So um I just think you know if that happens and you need cash why is it then that gold will do fantastic in that period? I you know gold and silver I I just you know fail to see why that will be the case. So I would say the the the correlation is there. It's sometimes weaker and sometimes stronger. But I would think that in a in a recessionary situation uh where we have a bubble bursting, it's going to be one of the stronger ones. But it'll be more because not because that particular correlation between gold and gold and the dollar, but more in general because it will be about getting cash. It'll be about being liquid and it'll be about being able to pay off your debt or whatever it is. And you don't hold, you know, you don't do that with gold. You do that with by selling gold to get dollars and then you sell your your euro. So let's see. Let's see what happens. I mean, people are so emotional when it comes to this. And the same goes with Bitcoin and they can see it declining and um I think we haven't seen a very very strong dollar for some time. And that's that's the thing. I mean, when we see strong dollar, everybody can agree. And you know, well, okay, this is this is bad. But uh but when you have the dollars declining from I don't know what 110 down to 92, it's obviously a good time for for gold and silver and for for for crypto also and uh and I think we're going to see a little more of that. But the strong dollar is not going to be nice to uh commodities. >> No, fantastic. Henrik, maybe allow me last final question, maybe summarize the conversation a little bit. Is if you were to find a million dollars underneath your couch cushion, how would you allocate that capital right now? And just assume it's not investment advice for anybody. Everybody's different, right? So, full disclaimer here, but I'm curious how you would allocate that capital today. >> Well, I I you know, it depends again on the on the time frame here, but if you >> you said it, it's it's your money. >> The time the time Yeah, the time frame, you know, matters obviously here. And uh you would say I would say that it's uh I would be very risk as I as I said earlier also and I am and I am very position like in for also for a crypto rally, for Ethereum rally. I think the we're going to see now a situation where gold is starting to be outperformed as we've seen actually by by Bitcoin uh for some time now. I think it's going to intensify. I think the same thing will be Ethereum and Ethereum actually will uh in a little short time more here then we'll see Ethereum actually outperforming Bitcoin. And if that's the case uh and uh well with the targets I have for Ethereum which is about 10,000 on Ethereum well then you're going to see a lot of these DAT companies that have been accumulating Ethereum uh which would be a great great place to be and that's where that's what I'm holding right now. So I probably would be putting more into that and the reason is simply that there will always be this kind of euphoric rally that we are now starting to see the the the the first phase off in the in the NASDAQ and the S&P that will rotate into other places as well and then you're going to see um yeah these these potentially companies doing well but that would only be a play for let's say a couple of months or you know after that I will be liquid. I would be in something that you know that would probably be if I had to then buy some TLTs and the likes because you know I think the the the yields could coming down quite strongly and uh and we could see that um the the dollar strengthening as well also. So so that would be the case and then later on when we see the Fed coming in I would be and I'll be glad you know to talk to you at that point and that will be all about precious metals it will be all about the gold miners and the likes and it will be all about commodities. No, fantastic. We we'll definitely have you back on when that happens. So, which could be any day. We never know. We'll see what Kevin Walsh does. They're already um you know printing money more or less. They ejected $600 billion into the economy already indirectly and directly. So, another topic for another day. Henrik, tremendously appreciate you joining us again. Always a pleasure. Um where can our audience follow more of your work? >> Well, first of all, I'm on on uh on X at Henrik Seberg. I'm also on Substack at Henrik Zeber and also if we want if you're an institutional um you know uh client you can also go to our SEM services which is where I you know every week I update our clients on on the direction of the markets and on the economy and uh yeah so so these pretty much the places to find me. >> Fantastic. Awesome. Henrik, thank you so much for joining us again. A pleasure to chat. Can't wait to do this again hopefully like when uh you know positive gold and silver environment. Always enjoy that. Of course, uh that's that's our our bread and butter business here, of course. So, really appreciate it, Henry. Thanks so much for coming on and everybody else, thanks so much for tuning in. Really appreciate you watching Sore Financially if you haven't done so. Hit that like and subscribe button and of course, let us know how are you positioned right now. Are you risk like Henrik is or are you risk off? Like, meaning are you maybe more conservative? Are you more concerned about the economy and the markets potentially uh going sideways on you? I'm really curious what what you think. Put that down below. Thanks so much for tuning in. And don't forget, don't let your emotions run your investments for you. Take care.