SERIOUS WARNING for All Silver Stackers! You Don't Know What's REALLY COMING - David Hunter

Hinzugefügt: 2026-05-05

[00:00:00]Uh we had that a couple years ago as you know when we had the Mag 7 dominating everything >> but I said consistently since then that the market would broaden out and we've seen that in the Russell. The Russell's at new all-time highs and nobody thought they'd see that. Um so and I and my forecast in terms of the Russell is that we're going to 3,800. You do the math on that and that outperforms the NASDAQ. It outperforms the S&P from here.

[00:00:26]Outperforms the Dow. So, um, yeah, it's kind of a a little different setup than if people are basing their forecasts on president. I don't think they'd get here, you know, many months into it.

[00:00:40]Initially, they'll be doing pieces of things, you know, well, they might print a trillion here or a trillion there, but ultimately when they see that this thing is just I mean, 2020 was a good example.

[00:00:52]when things are really starting to unwind quickly, [music] you can't go to Congress and say, "Can you come up with a solution? Can you figure out fiscally what we can, you know, it'll take months for them to figure out what to do, even if they move fast, the only thing that you can do that that is quick, is money.

[00:01:10]Yeah. If you look at that, there's a lot of people that see that as a um, you know, uh, a kind of a base built for higher rates. I see it as a big top, basically a two and a half to threeyear top in in rates and I think we exit out of this on the downside, not the upside. So, >> we're kind of we're kind of in the trading range as you say between kind of low fours and and the mid fours. Um, in terms of the 10ear, I think we're going to see very shortly um it move down under four. Once we get under four, I think we're we're heading for 3%, maybe even two and a half% this year.

[00:01:55]>> Under 3%.

[00:01:57]>> Yeah. I what I you know, right now the kind of narrative out there or the the consensus forecast out there, I think for the economy is that it's you know, it's moving along. It's not it's not robust, but it's not recession either.

[00:02:13]and inflation's heading higher uh is what people I think the consensus is. I think as we move along here we're going to see the economy slower than we expect whether [music] it's in recession or not. It's pretty you know it's moving in that direction. Uh and I think inflation on if oil rolls over here I think the inflation will move back into a we're trending down not trending up type of situation. So, um, both of those things, a slower economy and and better news on inflation, I think are going to help the bond market. Um, and and I think as we move into the fourth quarter this year, I think the economy will be clearly slowing and maybe slowing quite a bit.

[00:02:54]>> Current consensus suggests steady growth with lingering inflation pressures.

[00:02:58]However, emerging signals point toward a different trajectory.

[00:03:02]Economic momentum appears to be weakening and inflation could ease if energy prices stabilize or decline. As demand softens, price pressures often follow. This combination, slower growth and moderating inflation, creates a favorable backdrop for bonds. It also challenges prevailing narratives that rates must remain elevated. Instead, markets may be transitioning into a phase where capital seeks safety and stability, reinforcing downward pressure on yields while reshaping expectations for monetary policy in the months ahead.

[00:03:33]>> Yeah, definitely bullish bonds and stocks and I think surprisingly bullish on both of those. I mean, far outside expectations [music] of the consensus, uh, even the bulls, um, and bullish metals. So, you're going to have all three major markets, I think, moving together. Uh, it does happen. And it doesn't happen all that often, but it does happen.

[00:03:53]>> Interesting. When did it ever happen before?

[00:03:56]>> Um it usually when you usually see that is early in a coming out of a recession, you know, usually like coming out of ' 82 or coming out of um um 20089, you had metals moving up, you had bonds moving up, and you had, you know, stocks moving up. So, it's it's funny because we're, in my opinion, we're at the end of a cycle. So this is rare to see um all of those moving. And what else is rare is I think we're going to see in this final rally in the stock market a broadening in the market um where you know both small cap and large cap play um tech plays but also um financials play and industrial play etc. So it's unusual again as you move towards a major top normally you're you're seeing narrowing of a market. Uh we had that a couple years ago as you know when we had the mag seven dominating everything >> but I said consistently since then that the market would [music] broaden out and we've seen that in the Russell. The Russell's at new all-time highs and nobody thought they'd see that. Um so and I and my forecast in terms of the Russell is that we're going to 3,800.

[00:05:06]You do the math on that and that outperforms the NASDAQ. It outperforms the S&P from here. Outperforms the Dow.

[00:05:13]So, um, yeah, it's kind of a a little different setup than if people are basing their forecast on president. I don't think they'd get here. Uh, not.

[00:05:24]Yeah, I'm I'm pretty I've been pretty consistent saying I don't my forecast, this bullish forecast was not based on expectations of big QE. In fact, I've said part of the reason we'll have a bust is because they'll be slow to introduce [music] QE again or slow to get to a right-sized policy because of what they did in 20089 and and 2020. And you know, Paul's been consistently saying we aren't going back there. I think Kevin Worsh has been consistent in saying he wants to shrink the balance sheet, not grow it. Um, so that may be their, you know, their intention or their desire, but ultimately when the bust hits, there's only one thing they can do, and that is print money like there's no tomorrow. So it will come, but it'll come late. And that's why you'll have a bust is because almost because of what happened before, they're fighting the last war, they're they're reacting to what they realize was a mistake last time and saying, "We don't want to make that same mistake."

[00:06:26]And this time around, they're going to need to.

[00:06:28]>> In a rare alignment, stocks, bonds, and precious metals may advance simultaneously.

[00:06:33]The S&P 500 continues its upward momentum, while bonds gain strength from falling yields and metals benefit from renewed investor interest. Historically, such synchronized movement occurs during early recovery phases following recessions.

[00:06:48]What makes this scenario unusual is its timing, appearing late in an economic cycle. This suggests a unique environment where liquidity, sentiment shifts, and positioning drive multiple asset classes higher. It reflects a transitional period where markets anticipate both opportunity and risk at the same time. No, it's why I talk about a wall of worry. You you've got a lot of um you know, really since 2000 since 2022, since the bottom in 2022, institutional investors have fought this market all the way up. So, they've been defensively positioning. It doesn't mean they have a lot of cash because a lot of them can't carry cash. But, you know, they're going to get more aggressive. I think they almost, if you go back to when we we were at 7,000 before the [music] war, they were just beginning to come around to um you know, for the first time in, you know, 3 years, they were beginning to believe we were in a bull market. For a long time they were saying, "Yeah, it's going up, but it's it's a chance to sell. You know, this market, they were skeptical of how far it had to go because the valuations were high." When we went over 7,000 first time was the first time you really saw institutions talking more bullish, raising targets and then the war hit and they went right back into their bearish mode. Um, so I think that wall of worry, uh, even though it's bounced here, you know, the the sentiment has gone up, there's still a wall of worry out there in terms of real underlying skepticism towards this. And it's it's that move from that skepticism towards, wow, this thing has legs and it can go on for a couple years that's going to be that final move into the top, I think.

[00:08:35]Um, and so there's there's cash. People seem to think, you know, markets move up when the Fed eases and that they don't move. You know, I' I've been in this business going back to 73, 1973.

[00:08:49]Back then, it wasn't markets didn't depend on the Fed. Nobody was saying, "Oh, the Fed, if the Fed's not easing, I'm uh you know, market's going down."

[00:08:59]that that kind of u mindset I think got built in particularly [music] since 2008 because that's what really drove us out of you know the 2000 bottom 2009 bottom and then you had QE1 QE2 QE3 so people started thinking that equating that's what you need to have an up market now a lot of times it's you know it's it's basically organic it's coming out of the institutions getting more aggressive and retail but retail's already Recent gains are no longer concentrated in a handful of large technology companies. Instead, the rally is expanding across sectors, including industrials, financials, and smaller companies. The Russell 2000 has begun to outperform, indicating broader participation.

[00:09:44]This shift is significant because narrow rallies often signal fragility, while broad-based advances suggest stronger underlying momentum.

[00:09:54]Investors who previously remained cautious are gradually increasing exposure.

[00:10:00]This transition from skepticism to participation can fuel the final stages of a bull market, pushing indices higher as capital flows into a wider range of opportunities.

[00:10:10]>> I mean, it's if you I've been guilty of having to extend it. The cycle just keeps getting extended. So, it could again, but um my best guess right now is that it could start before the end of this year. You know, again, you bust comes recession comes first you know you don't go right into a bust I think initially it'll be a slowing economy into a recession but you could if if things start happening if something triggers it it's a possibility it could start before the end of this year probably late this year um may not maybe next year and then I think most of 2027 is is a global bust uh or all of 2027 so whether it starts fourth quarter quarter or first quarter next year. I think that's kind of the time time horizon for [music] when it comes. It's it's possible it gets delayed further, but I like I said, the oil thing maybe creates more fragility. Um there's certainly a lot of problems. Our, you know, our housing is probably going to get a bounce if rates come down here, but housing's already really rolling over.

[00:11:20]uh certainly in in Florida, Georgia, um you know, Dallas area. So, so I think um you know, we're already seeing the signs of a rolling over economy and then you add to that the massive leverage in the system and you can go from things seemingly okay to disaster pretty fast when when things start rolling over. Contrary to popular belief, market rallies do not always depend on aggressive central bank intervention. While figures like Kevin Worsh advocate for tighter monetary discipline and reduced balance sheets, markets can still rise through organic flows.

[00:12:01]Institutional investors previously defensive are beginning to reallocate capital toward risk assets. This shift creates liquidity without direct stimulus. However, this dynamic may not last indefinitely. If economic conditions deteriorate significantly, central banks could eventually reintroduce large-scale support, but likely later than many expect, increasing the risk of volatility during the transition.

[00:12:24]>> Yeah. Interestingly, I I mean, I saw a little bit of the hearing and for sure um you [music] know, he's getting hit from the left, you know, from the Democrats. Uh um and we knew that was going to happen. That's typically what happens in the confirmation hearing anyway. So, but he's as qualified a um candidate for this position as we've ever had. You know, as you say, he's been a former Fed governor. He's he's steeped in monetary economics. Um more so than I think almost any Fed chairman going back all the way. Um and so I I mean I I think he's a great pick. Uh I interestingly um because everybody thinks Trump wants lower rates and and you know interestingly somebody understands monetary economics like I understand it which is you know you don't lower rates by um you know it's not the Fed that cutting rates that lowers rates. It's controlling inflation and inflation is a monetary thing. He's basically a freedmanite. you know, uh inflation ultimately is um comes about because of overly um printing money or expanding the money supply. So, he's he's talked about wanting to shrink the balance sheet back that we, you know, went from, as I say often, in October 2008, the Fed balance sheet was 875 billion going into the crisis.

[00:13:55]uh it expanded from there to over three trillion and then uh up 3.7 trillion I think going into the 2020 crisis and then went from 37 up to 9 trillion [music] in response to the 2020 crisis.

[00:14:12]So we've gone from 875 billion back in 2008 to 9 trillion and now we've you brought we brought back down to I think 6 12 trillion. Um he's somebody that looks at that and says we're way out of bounds. You know, it needs to get brought back down. Uh I would argue I agree with that ultimately in a long-term theoretical from a long-term theoretical standpoint. The problem is if we're heading for a global bust, no matter what he thinks, and even if it were Powell in there, whoever is in that seat isn't going to have a choice. Like I said, they're going to be slow to and it probably wouldn't have been much different whether it was Powell or Worsh. They're going to be slow to want to print money. They're going to be slow to react to a an economy that's demanding more liquidity. You know, they'll do do it in fits and starts. I'm not saying they won't um expand money supply by at all. But what I think it's going to take, if I'm right about a global bust, and this is global, it's not just the US.

[00:15:17]I think you could see 20 trillion expansion in the Fed. So if the Fed got up to 9 trillion, you might see it get up to 30 trillion in terms of their balance sheet. If you told him that today, he'd say, "That's impossible.

[00:15:30]We'll never do that. I would never allow that." That's easy to say until you have a free falling financial system. And that's what I think the global bust will be more so from, you know, probably Europe. I think European banks are [music] uh more in more trouble than we are. Uh Canadian banks are more leveraged than we are now. They they were in great shape in 2008. They're now in in much worse shape than we are. you know, we were forced, our banks were forced to get religion, to delever, to, you know, build capital. So, our banks in 2008 were a disaster. They're not today. However, banks around the globe, Europe, Asia, uh Japan, uh Canada, you know, if they if they start running into big trouble, if we see, you know, financial failures overseas, our banking system is not going to skate through that. We'll be in trouble, too.

[00:16:27]So, you know, it's just there. It's a small world. So if that happens, you're going to see every policy maker around the world, every Fed, every central banker around the world at some point finally recognize we only have one solution that can move fast enough to save the system. And that's when you'll see all that money. But that will come well into the downturn, you know, many months into it. Initially they'll be doing pieces of things you know well they might print a trillion here or a trillion there but ultimately when they see that this thing is just I mean 2020 was a good example when things are really starting to unwind quickly you can't go to Congress and say can you come up with a solution can you figure out fiscally what we can you know it'll take months for them to figure out what to do even if they move fast the only thing that you can do that that is quick is money and it will take all kinds of liquidity poured into the system to stabilize the system and begin to move it the other way. So that's frankly um as much as I think Wars is the best person for the job um ultimately I think the macro trumps no pun intended but the macro trumps any policy. It it it doesn't matter who it is, they're going to be forced into this both here and in the central banks abroad.

[00:17:53]>> Despite current optimism, structural risks remain beneath the surface. A global downturn could begin as early as late this year or extend into the next, eventually evolving into a broader financial crisis. Early warning signs include weakening housing markets, rising debt levels, and vulnerabilities in international banking systems.

[00:18:13]Regions such as Europe and parts of Asia may face greater strain, potentially triggering global contagion.

[00:18:20]While markets may continue climbing in the short term, history suggests that rapid gains often precede sharp declines. For investors, understanding market psychology and maintaining discipline will be critical as this cycle approaches its turning point.

[00:18:33]Yeah, just because of where we're we are in the cycle, I just want to kind of make a little bit of comment about, you know, if if I'm right, and again, that's still an if. Um, but if I'm right that this is a blowoff top that we're going to see, you know, potentially 35 or 40% move here in a very [music] short period of time, four or five months. Um, I would just caution people to understand who you are as an investor, as a trader, whatever you are, understand how psychology works and just be aware that as we get closer to that top, if we see that kind of a move in a short time, the way psychology works is you're going to be more bullish, not more bearish, most people at the top. And there's going to be a compelling reason. You know, you don't go to a top with everybody thinking negatively. You're going to be at that time hearing all kinds of narratives that will convince a lot of people that this thing has legs, it can go on for a year or two or three more, that the Fed's behind us, you know, the winds at our back. Um that, you know, the situation in the Middle East is resolved. We have peace breaking out around the world. There's going to be a bullish narrative out there. I can guarantee that. And what you have to guard against is getting caught up in that. And people need to understand how sentiment works and how markets work. So that at the very top of a market, um the it's it's hard to sell. It's hard.

[00:20:07]You're you're looking and you're saying, "Well, what if what if they're right?

[00:20:11]Look what I could miss." And I would just caution people, don't be greedy. If you're in and you've and you've written it um you know understand it as as it's saying and it doesn't mean the minute you hear bullish sign is up like we saw on that chart. It over time you'll people keep asking me how will I know when the top is in and I say I I obviously won't be able to call the exact top. Hopefully I can get close but I may not. Um but my signal will be when everybody else is all in. you know, when when you're hearing everybody tell you that this thing has legs and that, you know, they're in with both feet, that's a signal to say, "Hey, I may not be capturing the top, but I think I've captured a good part of it." So just uh I would just tell people as a as a contrarian um you know it's important to understand how markets work and how sentiment works with those markets.