S3 E9: Debunking the Macro-Economic Myth that the U.S. Consumer & Labor Market are Strong

The current macro-economic “narrative” is as follows:

1.      The Consumer remains "strong", with a "healthy" Balance Sheet

2.      The Labor Market remains "solid." 

In today's podcast I use FACTS, data and simple mathematics to COMPLETELY blow up that narrative and debunk the greatest macro-economic myth out there right now, that the Consumer remains in a "strong" position, with a "healthy" balance sheet, and that the Labor market remains "solid". 

The macro-economic data is SOLID, in suggesting the complete OPPOSITE is true, that the Consumer is CHOKING, their Balance Sheet imploding, and a Consumer Cocoon and Credit Crunch is now well underway, more so as the Labor market gets a whiff of outright DEFLATION in the June Employment Situation Report for June. Throw in the New York Federal Reserve Bank's June Consumer Survey, revealing that Consumers fully expect that "real" (inflation-adjusted) Wage-Earnings-Income will DEFLATE by anywhere from (-) 0.7% to as much as (-) 2.1%, depending on Income Level, with those Earning $50,000 per year or less getting CRUSHED!!! 

As for the Labor market, if not for a +329,000 increase in the Number of People NOT in the Labor Force (AKA dropouts) the Unemployment Rate would have RISEN, as 8 of 19 industries tracked by the BLS posted OUTRIGHT JOB LOSSES, the most in four years ... while Average Weekly Earnings DEFLATED in June, as 14 of 19 industries reported LESS Hours Worked, with the Aggregate Hours Index, used by economists as a proxy for GDP, posted a (-) 3.6% annualized contraction!!!

And, Revolving Credit has been DEFLATING on a monthly, and year-year basis, something seen only two other times in US History, in 2008-09 global financial crisis, and the 2020 global health crisis ... thanks in part to a RARE DECLINE in PCE Personal Income, which fell (-) $125 billion in June, leading to an across-the-board decline in Spending!!!

Strong??? Yeah, NOT

Healthy??? Yeah, NOT 

Weak??? Hell Yes!!!

ILL??? Hell Yes!!! 

So, what to do, investment wise??
I answer that by asking YOU, Got Metals??  Got Crypto??

If not, get some NOW!!! 

Transcript

Consumer Strength Myth Debunked

Speaker 1 0:00

Hi, I'm your host, greg Weldon, and this is Money Markets and New Age Investing. We're season three, episode nine. Been a while since I've done an episode, back to May 24th I believe, and, within that context, only because we almost had World War III breakout in June, so it was pretty much pinned to the screen 24-7 for news and quotes and, as you could probably tell, it was a pretty hectic month for sure. But the bottom line hasn't changed the narratives that are important for 2025 remain the same narratives that have been important for 2025 since the year began, and that number one is the consumer and this narrative around how the consumer is strong, the balance sheet is healthy, the labor market's strong, and it's funny because you get commentators on fox who would suggest well, if you take this payroll number and try and say it was soft, you're basically rooting against donald trump, rooting against the economy and somehow unpatriotic, when those same people are having interviews where the guests are basically insulting Chairman Jay Powell with you know he's an idiot, he's unpatriotic, and so on and so forth. And if you really just dug down and understood the dynamic behind all this, you know, you would really see that the labor market is key to this in terms of making a case for Powell to cut rates, all right, as opposed to being upset because you were suggesting the labor market is weakening. Guess what the labor market is weakening? Get over yourself. And let's not say, okay, because the headline unemployment rate fell from 4.2 to 4.1, and the headline payroll gain was above 100,000, that the labor market remains aka solid, aka strong. It doesn't.

Speaker 1 1:59

And I can blow it all away with one simple point of order, one simple data point that the largest change of any number in this entire BLS employment situation report for June was the number not in the labor force, which rose by 329,000. That is why the unemployment rate fell, because 329,000 people fell out of the equation. The employment number was up 93. The unemployment number was down 222, which is good, but it also reflects the fact that some of those people, over half of those that are no longer unemployed are no longer unemployed because they dropped out of the equation. The participation rate fell too. Did anyone bother to notice that? Did anyone bother to notice that the number not in the labor force has now reached 2.88 million over the last 12 months? The rolling 12-month net change is 2.88 million. The only other times only three times in history that it's been higher, understanding the math, that you have a buyer-hire base because there's more people employed, so on and so forth. It still means what it means $208.8 million. It's not chump change. It matters when the only other times it's been this high was 2009, 2013, and 2020, two of which were major crisis periods, at least to lean into.

Speaker 1 3:31

Now, out of the employment, only 74,000 was private. The rest was government jobs, which you know are falling, so throw that one out the window, though. And of the 74,000 two two of the 19 industries for which we get a breakdown from the bls, only two of 19 posted job growth. That accounted for the entire gain health soldier services number one. Leisure and hospitality number two, the second one being the second lowest paying jobs of all. The second lowest paying jobs of all. Strong, that's not strong. Especially not strong when eight of 19 industries posted job losses that we haven't seen more than two in any given month for many, many, many months, and now we got eight out of 19, almost half reporting job losses. Strong.

Speaker 1 4:27

The number of people receiving unemployment benefits a different weekly report, 1.974, jumped much more than was expected a three-year high. It's up 130,000 in the last nine weeks alone and it's the highest since the pandemic. And it's the number of people receiving unemployment benefits this morning I mean you know that's 60,000 a month. It gets worse because weekly earnings were down. Deflation was here. Eight out of 19 industries reported job loss. That's deflation, all right.

Speaker 1 5:02

The fact that people dropped out and that's why the unemployment rate fell is deflation. Weekly earnings fell for the month. That's deflation, all right. And part of that is because there were less hours worked. So this is this myopic focus on average hourly earnings. It's meaningless. It's how much you take home at the end of the week, based on how many hours you work and when. Hours worked fall in 14 of those 19 industries. The other five were unchanged. Not a single industry out of the 19 industries for which WLS gives us detailed data had an increase in hours worked. 14 out of 19 were down. Overall, the index of aggregate hours, often used by economists as a proxy for GDP growth, fell by 0.3, which is an annualized GDP proxy of minus 3.6%. That's recession numbers Strong.

Speaker 1 6:01

Where's the strength here? I don't see anywhere where there's strength outside of health care hiring. To be honest with you, social services. Let's talk about wages broken down by the industries, 11 of 19 industries reported lower earnings. So 60% of industries. Lower earnings Not unchanged, not subpar growth lower 58% of industries.

Labor Market Weakness & Inflation

Speaker 1 6:31

The average earnings on a weekly basis year over year in the last two months 4.13 in April, 3.81 in May, 3.41 in June. It's down 72 basis points in two months. That's three Fed interest rate cuts. Decline in labor market average weekly earnings in just two months. Real earnings even worse. I mean it's less than 1%. It's 0.7. 0.7. 3.41 versus 2.7 core CPE. Year-over-year it's 0.71, down from 143, 1.43. The real earnings just cut in half in the last two months and they were already subpar at 1.4 year-over-year. Strong man, come on, look at the numbers. That report was not strong. Neither was the New York Fed's household survey of consumers Really interesting stuff.

Speaker 1 7:30

All right. The one-year inflation expectation has fallen. It's 6.6, down to 3.2. 6.6 out of tie, Now 3.2. It's cut by more than half. Still 3.2. Now 3.2. It's cut by more than half, still 3.2. And the median prediction point same number, different measurement is 4.3. 4.3. Not only that, but still the largest percentage of consumers in any category still put inflation above 4 in the next year 42% Overall.

Speaker 1 8:06

Those expecting inflation below the Fed's target within a year. 34% Expecting inflation above the Fed's target. 66% Still heavily weighted towards higher expectations for higher inflation. 3.2% and 4.3% these are high numbers relative to a 2% target and especially when you compare it even to the 2.7 PCE core rate. All right, that is what gets really interesting.

Speaker 1 8:31

And to those who say any of these numbers are strong, doesn't go all the way, digging deep enough to see where the reality lies. And the reality lies If you take that inflation expectation and compare it to the one year ahead labor portion of the survey, income expectation, earnings again, income wages all right in the last two months has fallen from expecting 3% year over year or in the next 12 months down to 2.5%. Down to 2.5%. It's the lowest in four years. It's the lowest in four years and on a real basis compared to the one-year inflation expectation of 3.2,. Consumers just told the Fed we expect our one-year-ahead real income to fall by 0.7, almost 1% decline. And I earn less than $50,000 a year income level. If you break it down by income distribution, the expectation for nominal earnings growth 1.1, which, against that 3.2 inflation, is minus 2%. The lowest income levels just told the Fed they expect their real income to fall by over 2% in the next 12 months.

Speaker 1 9:51

Strong Consumer, healthy? I don't think so. Not according to the facts, not according to the numbers, not according to the data. Let's turn to PCE, and before I get there, I'm going to jump ahead and then roll back real quick that, in fact, while the year-over-year 12-month total increase in public borrowing remains huge public debt, public borrowing for the first quarter of 2025, it was down from the fourth quarter by $2 billion nominal. I mean, it's almost nothing. It's pennies on trillions of dollars in debt, but it was down quarter over quarter. We've only seen that once in the last 10 years and that was in 2015.

Speaker 1 10:35

But that also has an impact on consumers and income, as per government transfer payments, which make up a large part of personal consumption expenditures, income, wages and salaries. To start off, before we even get to the government handouts, wages and salaries rose only 49 billion. That's the second lowest in the year and I'm telling you, below 50 is low, all right. And against that, proprietors' income dropped 49.4 billion. That's a huge and very rare decline. So, all wages and salaries for all the workers offset by proprietors' income which fell Net, net zero. Income growth Zero, wages and salary growth Zero. Now obviously more people get wages and salaries, so that's an overstatement. But you understand my point.

Speaker 1 11:27

And the point goes even deeper because personal income, excluding government transfer payments and that means handouts, social services and entitlements, ex-transfer payments personal income was down $110.4 billion. $110 billion, I mean on a monthly basis, down 0.4. All right, that's the first decline in four years and it was expected to rise 0.3. Big miss by Wall Street on that one. Overall disposable income down $125 billion. Savings dropped $97.5 billion.

Speaker 1 12:11

And you know what else fell. All this other time you've been using savings or credit cards to boost that spending, but since they're not doing that anymore, as we're going to look at revolving credit in a contraction a rarity since July of last year spending fell. Spending fell by $45.4 billion in June, all right. On services, it fell and that's been really relatively immune to some degree Down $2.8 billion. Durable goods down $39 billion. Non-durable is down $10 billion. And yet prices went up.

Speaker 1 12:49

Pce headline from 2.2 up to 2.3. For core rate 2.6 up to 2.7. Wonder why the consumer's choking? Well, now he's either unwilling or unable to continue to borrow money on their credit cards. Consumer credit Fed numbers delayed a month, but consumer credit rose $5 billion in May Was expected to rise $12.9. It rose by less than half. And let me tell you, five out of the last seven months are below $10 billion a month and $10 billion a month.

Consumer Credit Contraction Reality

Speaker 1 13:20

Below is the warning sign. That's the yellow line. Above that you're green. Below that you're in the warning zone, rare, that you get into the red zone where you're actually negative. It's only about warning zone, rare, that you get into the red zone where you're actually negative. It's only about warning zone.

Speaker 1 13:31

But here's the facts July of 2024, consumer credit was 5.05 trillion. 11 months forward to now, 5.05 trillion, it's exactly the same. It hasn't moved. The year-over-year rate is 0.4 off the Feb low of minus 1.1, which, by the way, was lower than the pandemic low of minus 1% in spending. So the decline in spending into February was worse than during the pandemic. And yet people say the consumer is strong. You know April's consumer credit growth at the high of April.

Speaker 1 14:07

In April 2022, when the Fed decided to finally pump the brakes, consumer credit was growing at 10.1% year over year. It's now 0.4% and it's actually unchanged for the last 11 months. So that's kind of a real problem. It gets even worse Revolving credit, and I don't take any pleasure in the gloom of doom, I don't. I mean spiritually, energy-wise, life-wise, all positive. It's just the reality of the consumer and the economy and where this is all going is unfortunately not uplifting, but it's the reality that people have to deal with. And if you'd rather be an ostrich, stick your head in the sand and ignore it and do nothing, you will pay the price.

Speaker 1 14:51

Revolving credit Revolving credit, which is mostly credit cards, the Fed's number for consumer credit. They break it down into revolving and no unrevolving but revolving credit Minus 3.2% annualized for the month. Minus 3.2%. That's a deep contraction. That's really bad. It was up 3.1% in the first quarter, up 3.2% in the fourth quarter last year, up 3.2% in the third quarter last year. In the last nine months it's gone from 3.1, 3.2 steady to minus 3.2.

Speaker 1 15:28

The flow rolling 12-month change down 42 billion dollars. A month ago it was up 89. It's the first decline since 2020. And only the third in history 2008, 2020, and now the only three times revolving credit has been negative On a year-over-year basis. Come on 2008, global financial crisis, 2020, global health pandemic. And now what is now? It's a consumer cocoon and a consumer credit contraction. It's deflation. All right. Now let's talk about public debt, all right. So when you kind of talk about this, you have public debt is down for the month, so this is a big negative. So this thing with PCE and transfer payments, this is going to intensify.

Speaker 1 16:29

Having said that, there is a bailout here, all right, and it comes from the fact that when you combine commercial bank balance sheets for loans and leases and the Fed's balance sheet, combine those two totals in terms of the rolling 12-month change, okay, there's only one time in history where it was upside down, where, in other words, the total between the two was net negative, and that was October of 2009 through March of 2010,. The only other time and now and now since December let me check that when is my reference on this one it was 2023, whichever month it was. So from that perspective, it's really kind of interesting to see this upside down. The Fed's balance sheet minus 568,. But bank balance sheets are big, positive, and here's the positive in it. Okay, you're up 516.

Speaker 1 17:32

This is one of the highest non-pandemic changes in commercial bank loans and leases since 2016. You're talking the period of 2014 to 2016 and 2005 to 2008. Think about those periods and what they led to. We are at levels above a half a trillion dollars in a rolling 12-month basis in commercial bank loans outstanding. All right, is also the highest since March of 2019. So that's really positive.

Fed Policy & Powell's Paradigm

Speaker 1 17:58

But it goes against the Fed's balance sheet, which is still QT. It's still negative $568 billion. And here it is. It's been upside down. In other words, these two things combined Fed balance sheet minus $568, bank balance sheet plus $516 means a negative net number. It's been negative since July 26th. These are weekly numbers of 2023. Almost two years this has been negative. Think about when this flips into positive. That's a big liquidity positive to whatever extent, and riding the fact that at least companies are still borrowing and banks are still lending. It's just not the consumer. It makes up the bulk of the economy.

Speaker 1 18:40

The other thing that's positive here and we talk about positive in terms of you know the attitude towards the Fed and how that's impacting the markets, particularly metals right now, with the big runs we've seen in the last week is money supply M2 at $21.9 trillion, back to a record high. All right, it's up 83% in the last 10 years by 9.9 trillion, but it is running kind of in hyperdrive with a $941 billion rolling 12-month change. That's only the fourth highest ever, excluding a pandemic October 2016, april 2012, january 2009. The only other times when the 12-month running change in M2 money supply was almost a trillion dollars right now. So these are positives. They're in a backdrop and it comes down to the Fed, because when the Fed goes back to at least unwinds QT, they're no longer doing QE to QT and they will be doing QE. They're going to have to because they're behind the curve again. You got people going on Fox calling Powell an idiot and unpatriotic.

Speaker 1 19:46

No, how about we take Jerome Powell's own change to the entire Fed approach? The new policy paradigm under Jerome Powell introduced in 2018 through 11 different white papers over 300 pages. I read every single word. They laid out how they were going to lift inflation, get it above average, above target, and then bring it back down. And they did exactly what they were going to say Inflation above target. And they had all kinds of formulas and academics and equations and everything Deciding on whether to use what moving average, how long Use a weighted one, how to weight it, do you use tolerance bands or not? In other words, will that inflation get above target, but if it gets to six, we'll start to move? No, no tolerance bands, meaning complete tolerance for any rate that it gets to, and then use the quote-unquote Volcker playbook to bring it back down. And this is all because, of course, powell is a Volcker disciple. All right, the dynamic around these two.

Speaker 1 20:47

I did a piece last year comparing 1978 Paul Volcker's first Humphrey Hawkins testimony to last year's Jerome Powell Humphrey Hawkins testimony. And the verbiage, the syntax, the words was almost the same. The biggest differential was glaring. Volcker, with almost no debt back in 78, was careful to say we don't want a credit contraction for the consumer. Both Powell and Yellen have said that wouldn't be the worst thing. And guess what? That's? The genie you don't want to let out of the bottle is the debt deflation genie Because of credit contraction. When you are now relying on credit to grow the economy, to service the debt, you're in that death spiral, you're in that black hole. You can't do that. All right, you will choose to reflate every time, all right. So Fed's behind the curve for the third time in the Powell Fed.

Speaker 1 21:40

I like Jerome Powell and I don't think you have to criticize him. All you got to do is use his own new policy paradigm as the evidence as to why rates should be lower already. All right. Four and a quarter is the low end of the range. The effective Fed funds rate right now is 433. Four and a half basis points below the midpoint, which tells you something. The pressure is on. There's kind of ample liquidity, so to speak. When you look at the inflation rate the PC core rate at 2.7, you want to say you're waiting for tariffs. That's all well and good. We don't know the impact of tariffs and copper just showed us what it could be. Platinum's up 40% in like three weeks. But when you talk about where the real Fed funds rate is right now, it is 164.

Speaker 1 22:24

All right, in 11 white papers, 300-plus pages, I read every word of the new policy paradigm. They defined R-star, the natural rate of a neutral policy For all different countries. Fascinating research 50 basis points above inflation is US R-star. Let's say we double it because of the pandemic and we get interested here in playing fair. Let's say it's doubled since R-star and let's say because this was 2018. Let's say and you're coming off zero and negative rates in Europe. So let's say the reality is that the pandemic has jacked rates enough and you do have the 40-year trend violation of interest rates and inflation to the downside and the new uptrend. So let's just double our star and make it 100 basis points. That would still imply that you should have cut rates twice more already, that rates should at a minimum be 375. And if you use the 50 basis point R star rate should be three and a quarter. This is Powell's own policy paradigm. Then you should be neutral, meaning you should be at a worst at 375, at worst, two cuts. Cut 50 immediately, and I'm not saying they're going to do that, I'm not saying they should do that. I'm saying, if you want that to be the outcome, here's the tools, all the consumer data I just gave you. Still, you know, 70% of the economy, and you need to be at least neutral. You don't need to be restrictive here. Not with a consumer cocoon, not with a credit crunch, not with a housing market depression for all intents and purposes, even though prices are not reflecting that, which is even worse, and the labor market is now experiencing whiffs of deflation.

Speaker 1 24:06

Pals behind the curve for the third time, both up and down Transitory. You remember that phrase and how much we bashed that. It was like waiting for Godot. They're going to have to play catch-up to other central banks that have already moved. You know, the ECB way ahead of the curve Bank of Canada, dough. They're going to have to play catch-up to other central banks that have already moved the ECB way ahead of the curve Bank of Canada. You have RBA and BOE a little bit in between the Fed and those other central banks, and the BOJ and PBOC are actually in the easy mode.

Speaker 1 24:32

It all comes down to the dollar. It's all about the dollar. That's what's changed in the metals. That's why silver all of a sudden has gained a lot back on its ratio spread against gold that everyone's complaining about. How can it be 100? How can it be 100? How can it be 100? It can be 100 when central banks buy hundreds of tons of gold and no silver over a two-year period. That's how, all right. And I said, and I said repeatedly on the podcast to my clients in person wait till the dollar breaks. It will break and when it does, silver will go too. And that's where we're at now.

Speaker 1 25:05

This entire dollar thing goes all the way back to the Carter administration defeating inflation. Paul Volcker, 1979, 1981. All right, the Volcker rate peak in the dollar right was very strong. The Volcker rate peak in the dollar right was very strong Into 1985, where the group of seven got together and came out the Plaza Court in New York City. I remember getting on the train that day to go down to the Commodities Exchange, where I was working at the time in the gold and silver pits, and I heard on the Quotrix. You know, there was no technology back then no email, no computers, no quotes at home, just the Quotrix, the Plaza court of inside. It'll help real close Big dollar down, all right dollar all the way down until the double bottom set in 2008, 2011.

Dollar Decline & Precious Metals Surge

Speaker 1 25:48

Double crisis period, don't forget 2011,. First, us debt ceiling crisis. Stupidest phrase ever Debt ceiling. That's an oxymoron if ever, ever, ever there's no ceiling on the debt. We know that All right, never has been. But 2011 was also the EU sovereign debt crisis, which was a big deal. That was a double bottom in the dollar and the dollar has rallied for 11 years since then ABC, perfect pattern, fibonacci to the nth degree, 38, then 50% into the 2022 high. The entire 26-year bear market was corrected in 11 years. All the ratios are just laid out so perfectly.

Speaker 1 26:23

Now the dollar is. You know you're pushing people away from the dollar. On trade, brics unit is going to be a reality at some point in time. You know all these things are for real Foreigners selling central bank assets. I mean, you know I mean selling rather US securities. I mean, the dynamic is the public owns most of the debt. The rest of it's owned by commercial banks and the Fed. So you know we're the ones that are going to pay the price, and that's in a lower dollar. All right.

Speaker 1 26:48

The dollar violates the 2023 low, which was important, and then the swing back to the upside this January was a perfect 61% of that move and all of a sudden, sudden, you're below the five-year moving average and you're down 12.5% from the 2023 peak. You were running almost 9% on a rolling 12-month basis at one point just two weeks ago. So this is why silver has exploded and, frankly, if you look at silver on a monthly close-only basis, it is set right now where it is now, assuming it holds through July, which is a big assumption these days and I'm not willing to assume anything anymore. But that would be the third highest monthly close-only ever, behind only August of 2011 and April of 2011. Even higher than the January of 1980 high which, on a monthly close basis, was $35.75. Not only that, to get the gold silver ratio back to kind of where it was, on average, say, for the last 10 years. You're looking at $47 silver and what is the high set in April of 2011? 2011? 47, 85. That's where you go, I mean, just straight up, and you know this move has still got a lot of legs and, frankly, if you then want to, you know again, that just reassesses you compared to gold, at a minimum, at a minimum.

Speaker 1 28:11

How about platinum? I mean, we recommend a platinum. The pplt was the et, the ETF. It's at this highest level since July of 2014. It's up 47% since we first talked about it. You're talking about the third year of supply deficit heading into a fourth year where by the end of next year, supplies could be less than three months of consumption of above-ground supplies of platinum.

Speaker 1 28:34

Palladium finally followed. I said it would. It was 990. We said it was going to follow platinum. It's 1263 now up 36%. You can still get involved. Silver is still early. I think SLV is the silver ETF. I prefer some of the equities now the PPLT, the platinum ETF, pall.

Speaker 1 28:53

I also mentioned Sabanier Stillwater. It said below $5 it was valued. It's now pushing $9. All right, the S-I-L. You know, still very valid. $94 was the 2011 high. It's last at $50. So it's got a lot of potential upside. But a less expensive way would be the S-I-L-J which I personally own $15.81, broke out at $15 1518. It's not that far from the breakout and 2012 high. It didn't exist in 2011. It was almost $22.

Speaker 1 29:23

All right, I like First Majestic. I've talked to everybody before I own it. All right, it broke out at 750. It's now nine and a quarter. Mag, which was my favorite, taken over by Pan American and it's trading above the offer price. So, favorite, taken over by Pan American and it's trading above the offer price. So I don't know what's going to happen there. It could be interesting.

Speaker 1 29:40

You know we liked Heckler last year. I don't like it here. It's too hugely owned. It's underperforming. It's a little too volatile on an interweek basis. I much prefer now SVM Silvercorp in Canada. 2020 high was $11. It's still only $7. In 2011, it was almost $16. And really right now. If I had to choose one to buy now versus First Majestic, would have been maybe a month or two ago. It's Endeavor, also in Canada, breaks out at $5.66, but it's still only $5.84 with a $13 high in 2011. So that's just some picks. You know we do this every day, so there's always a lot more going on in all the other sectors too. We cover all the sectors, every industry, every country.

Speaker 1 30:27

Copper is the other one to note 568 last. That's a record high. It's up 41% just from where it was in April, where it was only $4. Now this is because you've seen a huge decline in inventories, for two reasons. Number one US manufacturers imported a lot of copper when tariffs were first talked about. So the tariffs are bad and 50% is bad and it does threaten longer-term dynamics, but in the short term it's not going to affect the US as much as it will. Actually China, because Chinese inventories of copper have fallen by 66% since September of last year. Check that that's LME, I'm sorry, lme 66%. China's stock's down 20% since March, down to 130,000 tons in Shanghai, 108,000 tons in the LME. That's about 400 in total. You can see half of it's held in the US now, but overall inventories are down over 25% just since the fourth quarter. So that's big for copper.

Metal Investment Recommendations & Outlook

Speaker 1 31:29

I also like crypto and I did a special piece on this and we actually talked about Bitcoin in the last episode of Money Markets and New Age Investing Bitcoin. The breakout targets, on a measured move alone, a minimum upside of $169,500. We bought Ethereum for the money management clients at $28.91 when it took that level out. You're now looking at $41.40 and then $4900. Bitcoin against the S&P is up 9.6% over the last 12 months and that's just bouncing off a low. So that's low. So you're buying it at a very cheap level compared to the stock market, relative to past outperformances we've seen from Bitcoin against the S&P 500.

Speaker 1 32:14

Interesting way to look at it Ripple I bought it at 238 myself, actually this past week. 265 was the breakout. This entire decline from the 2025 high has been a perfect fifth ABC 50 and then 61% retracement. You violated the downtrend line. It's up 16% since I bought it, like in two days from earlier in the week. Uh, and I could, you know, maybe 329 339 probably has four dollars in it and the other one I'll mention at the risk of, you know, I'm not I'm not, uh an expert on AI.

Speaker 1 32:48

Having said that, you know I remember reading the Bitcoin paper way back like literally probably 2011. When I finally read it it was already two years old, but many people had not read it by then. Reading the paper from Bittensor and TAO T-A-O. Tao is the crypto. It's an AI protocol, much like Bitcoin wanted to be a kind of decentralized currency quote unquote protocol. So it's kind of interesting how this plays in. And I read the white paper. It's very interesting and again, while I don't know a lot about AI, having done this since the time before there was cell phones and email and computers and all of this when it was paper strewn all over the place I've seen all these changes and I think that when I see kind of where I think AI is going and I read the paper from Bittensor, it makes sense to me.

Speaker 1 33:43

It's really that simple Tau breaks out above 402.65. It's been crappy, it's been bad performance. You have a two-year downtrend, but that's where the downtrend line is the 200-day moving average and the breakout really to a new high would be 488. But it's been like 750. So we'll see. Just keep an eye on it. I think it's an interesting thing to watch, for fun, as it were, and for disclosure's sake.

Speaker 1 34:07

Yes, I do own First Majestic Ripple New Gold, by the way, silj and SIL, all right, in my fund. We own silver, gold, platinum, copper, palladium, gasoline, soybean oil and Bitcoin and Ripple Bitcoin excuse me, bitcoin and Ethereum. So, just for disclosure's sake, now you can follow me at Weldon Live on Twitter. You can follow the podcast on Twitter at money underscore podcast. Follow me on YouTube at a user underscore Gregory T Weldon on YouTube and you know again. You know from the perspective of owning a lot of the metals and having, you know, really done well over the first half of the year.

Speaker 1 34:50

This is something that we set our money management account and money management program up specifically. I'm a math and science geek. I wrote algorithms way back in the 1980s. We've licensed them out to institutions. We could be an ETF. I could have created many ETFs off of that. But in the context of the discretionary trading which now 40 years of experience has really honed me to where I really feel, I see the risk-reward better than I've ever seen it. It's been nothing short of outstanding. So if you want any information about that, accredited investors only. I won't talk too publicly about the performance, but let me tell you it's outperforming performance. You can email me at greg W-E-L-D-O-N at weldinaligncom. And thanks, hey, thanks a lot for listening. I appreciate you all out there.