Speaker 1: 0:00

Felix here and we appear to be live from a rather new location. I hope you can hear and see me clearly. We are, of course, outside in the glory that is the south of France. So what I want to walk you through here, just as I just landed here, because some stuff just happened that is incredibly important and if you don't understand this, you're going to make some rather silly moves today. First of all, china has cut interest rates. Secondly, what about the Fed? The Fed is deciding today US interest rates. Are they going to follow suit? I'll tell you that. And what? This huge shift that we have seen in Fed policy the last two days? It isn't announced, but it's in the data. It's a little secret, but nobody really understands what it actually means, even the people who have noticed it on social media or the occasional loon in mainstream media. They don't understand what it means. I'll explain to you, so you'll be the best and probably the best out there. Does that sound good? That sounds good. Put a one in the chat and I know you're listening. Plus, we have more good news and even more good news.

Speaker 1: 1:13

But I'm still worried about the market, and I'll explain to you why, just so that it really, really, really lands for you and really makes full sense for you, because that's really the goal here. You can hear okay, brilliant, absolutely fantastic. It's a touch bright here, so I'm going to struggle a little bit to seeing the screen, but I'll share my screen with you regardless. At least you can see what I can see or maybe can't see. I'm going to have to do something about the brightness out here. I'm seeing lots of ones. Brilliant, love that guys. Thanks very much. Always a bit of a wobble when you set up your kit somewhere in a different location. You might have seen me here before, by the way, if you've been watching for a little while. We're usually here in the summer, so let me share my screen with you. Pre-market you can see it's looking all right.

Speaker 1: 1:59

Now, as I say, china's cut interest rates. What about the US Fed? What about this huge shift? What does it mean for you and what does nobody understand? And then we have lots of good news. But I'm still a little cautious here and I want to make sure you understand the reasons for my caution. I'm not a doomer and gloomer. I'm not a pessimist quite the opposite.

Speaker 1: 2:19

So let me first of all explain what China's just done. So China has just done a bunch of things. Essentially, they're stimulating the economy by making money more available. That's essentially it. So they're essentially cutting interest rates in the slightly funky way that the Chinese do that. And why are they doing that? Well, maybe it's got something to do with that meeting in Switzerland. So the Chinese are meeting the Americans to talk trade for the first time since you know, 1986 or something no, not seriously, but since the sort of 2019 stuff and the market's saying that's good news.

Speaker 1: 2:56

Now, if you saw me yesterday on Twitter or on XRubber, I was saying by the announcement, sell the meeting, and I'll explain exactly what that means in just a second, because I think that's very, very important. But, to start with, you just need to understand that they're cutting interest rates. So what about the Fed? Well, the Fed is going to say to you and I'll explain what's on the screen in just a second, but it's going to save you a lot of time today Don't watch the Fed press conference, don't bother with any of it Jerome Powell is going to say we're data dependent. He's going to say there is uncertainty because of tariffs, we are uncertain what inflation is going to do, and we will move with data as it moves, when it moves, and that essentially moves. You need lots of unemployment in the US for them to cut rates. We haven't got that, so, basically, they're going to do nothing. It's a complete waste of time the whole thing. Don't bother watching it, don't bother listening to it, don't bother reading much about it. There'll be very, very little unchanged, and if that isn't true, then well, I don't know. I'll eat my hat.

Speaker 1: 4:01

Now, what the Fed is doing, though and this is sneaky, really, really sneaky business. They bought $14.8 billion worth of bonds yesterday, and you might be thinking why do I care? Do you know how they print money? They print money by buying US government bonds. That's how they print money, because they don't need to have the money. They can just buy stuff and create the money. That's how they print money, because they don't need to have the money. They can just buy stuff and create the money. That's how they do it. That's how they've been printing all that money during COVID and yesterday, so the day before. They bought 20 billion of bonds the day before, so that's almost 35 billion in two days. That's a little unusual.

Speaker 1: 4:42

Now, before you go all nuts and start buying all the stocks you wanted to buy because the Fed's printing money and all that sort of stuff. Bear with me for just a second. So there is no printer. By the way, there's no physical printer. No, no, they don't. It'd be silly to print all the money. They can just do it digitally. They can just say we're buying 34 billion of bonds.

Speaker 1: 5:04

Where does the money come from? Well, I just created it, I just type it into my spreadsheet. Now it exists. That's literally how it operates. It's bizarre, but that's how it operates. So you're, of course, going to run out and buy loads of money, loads of stocks now, but here is where that. That's the report from yesterday. That's where that 14.8 billion comes from, and they put these out every single day.

Speaker 1: 5:25

If you want to subscribe to something exciting, subscribe to the Department of Treasury's Treasury News. It doesn't get any better than that. It also cures insomnia. But what it does mean and I'll try to make this chart as bigly for you as possible on a laptop screen Can you see on the chart here a green line, a bright green line? If you can see a green line, write green in the chat and I know you can see it. What do you see? Okay, so it went up pretty much in a straight line for a really really, really, really, really long period of time and now there's just the general amount of. I'm explaining whether they're printing and how they're printing and doing that. Okay, george, appreciate the green there. Thanks you're. First, george wins the green prize. That was normal, right.

Speaker 1: 6:12

And then here a little hiccup happened. That was called COVID. And then Jerome Powell lost his mind. He was like a gambler. He was just drunk on money and he thought I'm going to print money. I'm going to print a little bit. Actually, why don't I print a bit more? This is so fun, let's keep freaking going.

Speaker 1: 6:31

And he printed some extraordinary amount of money. How much did he print? Can I still see that? Yeah, so he printed. He took us from about 16 to about 22 billion. So he added about $6 trillion to the US money supply. We were at $16 trillion. He added $6 trillion. So from the very beginning of the US dollar history, when somebody invented the US dollar, up to COVID, they created $16 trillion. Jerome, the magnificent money printer Powell, added $6 trillion on top of that in just a couple of months Completely lunatic, if you ask me. Now, whoops, something just fell across the camera. But we're still good, right? Yeah, we're still good.

Speaker 1: 7:16

And then they said they're going to start shredding money. Now you can't really shred away $6 trillion worth of money, because all the rich people would get a lot less rich. And rich people don't like it. They don't like it. Ask my kids around here. They would not enjoy it. So they shredded a little bit, just a teeny, tiny bit, sort of a token effort.

Speaker 1: 7:35

And what are you seeing now? Well, they're printed, and they're printing a little bit faster off late, right, and that's important. Why is that important? Why should you care about some weird technicality the Fed does? I should have probably told you that at the beginning. Does that make sense? By the way, if that makes some sense to you, put an S in the chat, and I know that it makes some sense to you.

Speaker 1: 7:55

But let me show you the chart of all charts and I'll try to zoom in on this as big as possible. So what have we got on here? We've got in green, big as possible. So what have we got on here? We've got in green. Money Seems appropriate, doesn't it? So let me get a. Where's my pen? Can we write here? Yeah, green is money, so the dollar, and then in that sort of red purplish color, what have you got? We've got the Thanks for all the S's there.

Speaker 1: 8:20

Guys, I'm glad that this is landing for you. That's always the intention. We've got the NASDAQ. Now, can you see? Can you see clearly, now the rain is gone, can you? I landed here this morning. Everyone's complaining about the weather and it's like hallelujah. It's sort of glorious. If you can't see it, it is absolutely glorious. Can you see the blue sky? If? Can you see the blue sky? If you can see the blue sky, let me know, it's absolutely freaking glorious. The sea looks glorious as well, but you're not here for that. You're here for learning how to make your money work better for you. So can you see that the NASDAQ and the money moves in line.

Speaker 1: 9:04

So all of us who thought we were smart investors we're not really are we. We're just basically following along. We're just on the right, really, and the Fed prints all the money and we all get richer. And then they started shredding money and the market went oh, don't do that. We need this stuff, we need the source. And then they stopped here and as they stopped, the markets recovered. Come down a little bit, but the more they print, the more this will go up right Clear as day. They're about to kiss indeed. So this is good news, goodly news, right, glorious news, marvelous news, absolutely fantastic news. And I'm excited because I'm in Europe, which actually I kind of, if you in Europe, which actually I kind of never felt like that. Actually, I'll tell you in a sec.

Speaker 1: 9:48

Okay, before you guys now run out and buy stocks because you think you understand it all, let me ask you one question who here has, or actually who here does not have a piece of paper on his desk with written rules of when he buys and when he sells? Who doesn't have that? If you don't have that write and put an R in the chat for rules, right, and let's be honest about it. There are what? How many of you are online here? It's a little hard to see on my very bright screen here. There are 2,700 or so of you live here. How many of you? I'm going to see a lot of R's here how many of you don't have written rules on your desk? Just be honest about it. So there's no shame in it. We'll shame you afterwards, by the way. Okay, there's lots of R's here. Now let's shame them, shall we? There is Nicholas, there is Doug, there is Nicholas, there is Dirk, there is Just kidding.

Speaker 1: 10:43

No, I love you guys for admitting that, because that makes you normal, it makes you human. It means you probably have friends, you probably have a social life, you get invited to things and you go to parties and people are happy to talk to you. Right, it makes you a normal human being. Now, the problem with that is that the only successful investors I've ever met and I've met a lot of them, guys who've managed hundreds of millions, billions of dollars for big funds they've run their own hedge funds, retired, living the life, glorious stuff and continue to massively outperform the market. What do they all have?

Speaker 1: 11:16

I know you thought I was going to say that, didn't you? They've all got rules. Why do they have rules? Because if you don't have rules, you don't know whether you're doing it right or wrong.

Speaker 1: 11:24

If you don't have rules, you just go in with the flow and you're hoping and praying and wishing. You're basically like Jerome Powell, the guy drunk on money, and it means you have good times when the market goes up and it means you have bad times when the market wobbles, and right now it's probably an okay time after a bad time, right. Wobbles, and right now it's probably an okay time after a bad time, right. It's entirely avoidable. We can make money in all markets. We can protect our money. We never, ever, need to have large losses. It is absolutely fricking avoidable.

Speaker 1: 11:53

But you need to do one thing you need to have rules on your desk. If you don't have rules on your desk, you need to get some. Where do you get them? These are the rules that the most successful investors I've ever come across, on both Wall Street and Chicago exchanges, have used for about 50 years. I did not invent them. Yes, I've put them together and I've simplified them somewhat so they're easier to understand, and I might have updated them a little to fit this current market, which is a lot quicker than it was 50 years ago, but ultimately there is the same rule for when do we buy, what do we buy and when do we sell. And once you know those crikey, life gets a lot better and you can sit here in the south of France and enjoy the glorious sunshine, which is what I'm doing.

Speaker 1: 12:38

So who's going to go and get themselves some rules? Well, probably only those of you who actually want to get to retirement early, want to live a nice life, want to be financially free and actually get free. So for those of you, you have 15 minutes, you can go to felixfriendsorggetfree, you can learn them, and anybody who's going to do that, put a G in the chat and all of you guys who've already seen it ask let me ask you, this was it useful? Tell me whether it was useful in the chat and we'll encourage a few thousand others to do the same and get out of this randomness of I'm up, I'm down, I'm up, I'm down, right, it's funny if you're Homer Simpson, less funny if it's your life savings, right. So felixfriendsorg slash get free is where you get. That Link is also down below in the description, my friend, and also read what the guys are writing in the chat here regarding usefulness. That's really the best way to get that across.

Speaker 1: 13:30

Now, what the Fed is doing here okay, loving you guys for writing all that in the chat there Amazing. Let me explain what the Fed's really doing here and this is what nobody really understands. If you understand this, you're like top of the pile, top 1%. They're not printing money in the traditional sense. So QE is quantitative easing. It's money printing. The $35 billion actually comes out of an existing Fed brokerage account. Who's the broker of the Fed? The Fed. Who's the banker of the Fed? The Fed. Who's the banker of the Fed? The Fed. Who's the accountant? The Fed? Who's the auditor? The Fed. It's a great system if you can just generate money.

Speaker 1: 14:13

So it's essentially a reinvestment, but it matters still because what they've been doing is that they've been letting these investments as they expire, because these are bonds that they buy. Bonds expire, they have a finish date. Right, they're letting them expire and that's been reducing the amount of money out there. But for the last two days, they've been taking that money and they're reinvesting it Like you taking, selling, you know Tesla and buying AMD with it or whatever. Please don't, I'll talk about that in a moment but this is important because it provides liquidity, which is hugely positive for the market, especially the stock market. So this is the Fed, quietly, without headline grabbing, stepping in and supporting. The big problem we've been having under the surface that nobody really understands has been liquidity. They're solving that, they're fixing that and I'm absolutely loving that they're doing it because it'll make us wealthier fast. So now you understand what nobody understands. So it's not real money printing, but they're not shredding the money. Instead, they're keeping that money around, and that's very, very, very good news, so we're happy about that.

Speaker 1: 15:33

Now I told you there'd be a few other things that I'm very happy about, and it isn't just the glorious sunshine here really is. There is something about this part of the world. It's called the kutazur for you know, coast of blue, because it's so, so blue, and the sea is blue, the sky is blue, the colors are amazing. There's something about that. If you ever want to have never been around here, do come especially. I'd say may and september are really the golden times when it's not overrun with. You know, I was going to say the Huns, but that'd be funny because I'm German.

Speaker 1: 16:14

Now, what is else is good news? Buybacks. We've just had the biggest buyback ever and the announcements are bigger than ever, and it's just getting bigger and bigger and bigger, and this is supportive for the market. So buybacks are just big companies buying their own stocks, like, say, palantir is buying their own stocks, paypal is buying crazy amounts of their own stock, and a lot of these companies Apple spend what $100 billion or something on buying their own stocks. So this is what we're talking about here. So this is supportive. These are buyers, is what we're talking about here, so this is supportive. These are bias.

Speaker 1: 16:44

And then this is also supportive, why? Because too many Brits there, yeah, so that is a bit of a problem. You shake a stick and there is an Englishman around the corner. It's not better than the Germans, though, isn't it? Let's face it, much better than the French. Oh God, I'm going to get some really good service here around here the next two days, aren't I? So I'm showing you what. I'm showing you consumer confidence.

Speaker 1: 17:08

Now, when consumers that's the black squiggly line is consumer confidence. I mean, consumer confidence is terrible like it is right now. It is down here. That is it. So it's pretty bad, right? Sort of historically speaking, we're kind of at like 1980 periods or 2008 global financial crisis type stuff, right? Pompous, red-faced wine guzzler yes, exactly, brits. So why is this good? Is it not bad if the US consumer is really really depressed and miserable? No, it's actually a good thing, because when they're really depressed and miserable, they can't get that much more depressed and miserable. First of all, you have a lot of prescription drugs, let's face it. That's one thing that keeps you a little happier. And secondly, you can't go much lower than the present level of depressedness.

Speaker 1: 18:07

And that means is it more likely to go up or down? This is a game we play, right? Is it more likely to go up or is it more likely to go down? I think I've sort of given it away, but put it in the chat up or down, what's more likely? Put a U or a D in the chat so I can see that you're paying attention. This actually makes sense for you.

Speaker 1: 18:34

George is the quickest. He's really quick. Off the mark, that guy. I'm loving it Up. Okay, matt seems to say up, at least the chart seems to say it, although it's a red line. It's a bit confusing, isn't it? Up, up, up, up, up, and lots of u's there. Okay, most of you think it's up, duh, indeed, up in a way. Yes, okay, so I agree with you. So, because the consumer confidence is so miserable, it's very likely to go up and zoom in a little.

Speaker 1: 19:01

And what you can also see and I'm going to see if I can get myself another pen color here what you can also see is that every time we've been this depressed, like in November 2008, over the next 12 months, the market went up 22% In 2011,. The next 12 months the market went up 22% In 2011,. The next 12 months, the market went up 15%. In 2022, it went up 17.6%. You get the idea. May 1980, it's around about the time I was born. Actually it was up 20%. Apparently it must have been the good news that I was around In 1975, up 22% and so on. You get the idea. So when we're really, really depressed, the market tends to rise afterwards.

Speaker 1: 19:39

So be a little bit of a contrarian and absorb that, and feel free to take a screenshot if you wish. I'm going to take this chart away now. So there is that right. Any other charts? Well, yes, go and learn the rules. My friends, none of this macro stuff is going to make you money unless you have rules, unless you have automations.

Speaker 1: 20:05

I've been buying a load of stocks this week and last week and you guys in my community, you see it all. I've been rather active and we're making quite a lot of money and it's brilliant. And they're not the stocks that you talk about all that much. They're not your Nvidia, it's not AMD, it's not even Palantir. All that's starting to look a bit more attractive. It's things like gold and defense stocks and boring things that are making us money.

Speaker 1: 20:30

So why did I start this off by saying that I am worried? I'm a little bit teeny, teeny, teeny bit worried. Okay, a couple of things. The VIX, the fear index, is presently at 24.8. It's up just a teeny, tiny bit, but it's enough to not make me feel all that wonderful about it. Why? Because we like it below 20. So there is still an elevated level of fear on the market.

Speaker 1: 21:00

Now the Trump meeting with the Chinese. I think it's great. I think people should talk. It's much, much better than not talking. But if you think about where they are at right, trump is sort of over here, the Chinese are sort of over there. For them to meet somewhere in the middle seems highly unlikely anytime soon.

Speaker 1: 21:23

The US government has said they're hoping to have trade deals in place with 80 or 90% of their key trading partners. We're talking Mexico, canada, the apparatchiks in Europe, the Indians, the Koreans, the Japanese, you know allies by the end of the year. That's the ambitious time frame that they're hoping for, which is probably a little ambitious. Most trade deals take a decade to negotiate and maybe another decade to implement. So I'm not saying it isn't possible to do this with countries that really want to do business with the US, like India, for example. They stand a lot to gain, but given the relations at present with the Middle Kingdom, it seems a little unlikely that we're going to do anything this year or maybe even next year.

Speaker 1: 22:15

That's the way I look at it, seriously. So, yeah, there may be little teeny, tiny bits where they really really need something, like when China has just exempted airplane parts, which they obviously need, and the US has lowered some things because they really need certain things. But other than that, I still think this standoff, this freeze, is going to last a while, because who's going to blink first. So the market getting excited about that is not positive, because it's going to get unexcited about that when nothing happens. That's my view. Maybe it's a little bit depressing, but that's one view.

Speaker 1: 22:51

Now, secondly, we're still looking at gold, for example. Up and up and up and up and up. Right, okay, touchdown today. But look at that chart. Why does gold go up like that? Because people are worried about inflation and the world and everything else, so people go into. Gold Seems like a safe haven. So when the safe havens go up, the market rarely goes up at the same time, at the same time, and we're seeing some of our favorites well, even the Palantirs struggling to break through the recent highs. Right, that one up there and, by the way, I did warn you about that in advance. Right, I said I think the risk is to the downside. By the way, I'm liking it. I like that it's pulling down because I think it's going to give us a nice entry opportunity. Himss is another one that's actually doing very, very well. It could make you feel a little bit bullish on it, but even stocks like, say, amd, everyone's like, oh, amd. Finally, finally, I'm sorry, really, you're looking at that and you're going this is a breakout. Well, that was a breakout too, wasn't it? And this one and that one, and this one, and that one and this one. So this is a breakout.

Speaker 1: 23:57

What is our criteria? Who has watched our masterclass? I actually can't see 50-day moving average line on the screen because it's too dark my screen. It's too bright here, rather. Oh, there, it is Okay. So we've peaked our head above it. I see, I see, I see, okay, let me zoom in a little bit. Honestly, it's a little too bright to be doing this outside here, but it's nice to be outside at the same time. Can we zoom in a bit? Yeah, so we've got the 50-day moving average line there, but the 150 is somewhere up here and we want to be above that. That's what I would say. So I still think.

Speaker 1: 24:31

Semiconductors I'm not touching it. I've been saying it for weeks. What are the semiconductor sector doing? Can you see what it's doing? Do you see the yellow line, my friends? And if you don't know what the yellow line is, go watch the masterclass, because that'll help you tremendously, so you understand what that means. You see that bounce off here, right, that is not bullish, denise, appreciate you. Thank you very much.

Speaker 1: 25:06

Yeah, this is just not a bullish sector. There are plenty of bullish sectors out there, but this is not one of them. So what I'm begging you to do is get your mind off. I can only make money with tech hardware, because that's been what's making us money for the last 10 years. The market is cyclical. Software I'm a fan of again, yes, absolutely. That changed last week. So US software I'm a big fan of, but semiconductors do not make that list. It's too early. It's just too early, and you might be thinking, yeah, but it's cheap. Yeah, people said that when AMD was $100 higher, people said that when Meta was at $300 and fell to like $80. Same story for PayPal and many other stocks. There are millions of stocks that went from $100 to like $0.90. I'm not saying AMD is going to do that or any of these, but the risk is there.

Speaker 1: 25:55

So you want to be in stocks. Well, maybe you don't. Maybe you don't want to make money, maybe you just think this is some sort of weird way of spending your time. But if you think this is really about getting to retirement early, looking after your family, being calm and collected and enjoying life so you can be wherever you want to be, provided you have a phone or a laptop with you or something which is sort of my setup then you need to make decisions that are based on actual rules that the most successful people in the world use, because otherwise, how will you ever be tremendously successful at it? You'll have lucky patches yeah, everybody does but if you don't know the rules, you just don't know which direction to run right. Basically, so please, please, please, learn the rules and it'll prevent you. If nothing else and the link's down here, by the way, felixfrenzorg slash, get free It'll prevent you from ever having a big loss again. Just think about how much better you'd sleep if you knew that your portfolio would never generate a large loss, that you would then nurse for years and try to hide from people around you. Does that ring a bell with anybody? Perhaps, as the mosquitoes are coming out, let me see. It's a little tough for me to see your questions because it's a little bright out here.

Speaker 1: 27:15

What about shorting AMD? I would ordinarily say yes, but the problem is that we have so much geopolitical noise and we have so much Trump noise that another Trump tweet will take everything up, irrespective of where it's at right now. So I'm very cautious with shorting and I would be very cautious with shorting. And really, if that's your mindset, you just have to ask yourself someone call an ambulance? Why do you care to make money with AMD? Why not pick another stock that's actually going up? In long run, the good stocks go up. So it's a little easier to pick the good stocks and watch them go up than to find the half-baked ones and watch them go down because it's going against the trend. So I would I would not start with a shorting thing. I think it's a. It's a little misguided. At least that's my, my humble opinion. You, that's my humble opinion. All these stocks, japanese stocks, even English stocks, anything really, even French stocks, it'll still work.

Speaker 1: 28:46

I use stop losses, my friend. Yes, you mean stop loss limit orders. No, when I want to get out, I want to get out, so I want to get out For buys. You might want to set a stop buy limit order, something like that. Yes, because you don't want to overpay. So say you want to buy it when it goes from 9.50 to 10. Maybe you want to buy at 10., but if it shoots to 15, you probably don't want to buy it at 15. You want to buy it at 10 or 15. So it can be useful to do it there. How do you get stop orders to work outside trading hours? You don't, and it's one of those funny things that people are always obsessive, and you know how often I get that question and it's a great question. I love it because everybody's always asking it.

Speaker 1: 29:27

People obsess so much about the random outlier, the one in a thousand event where the one stock that you have in your portfolio drops massively after hours, which it usually does on earnings. But you could circumvent because you know when the earnings are and that random one in a whatever thousand or 500 event then prevents them from applying all risk management bloody splinter to all their stocks because they're worried about the one outlier. So the market is not about I will make money with every investment or every trade. It doesn't work like that. The market's about making big gains and small losses, and if you allow the small losses to become big losses, you'll have no money left to make gains with. That's what it's actually all about.

Speaker 1: 30:20

So it's completely fine to lose money on individual investments. I do it all the time, like every week, a bunch of them I don't know something closed. Yesterday one or two of them stopped, got stopped out. Really don't care, it's completely fine with me because the gains will easily pay for those small losses. But if I let those losses run up from a couple of percent to 10%, 20%, 30%, 50%, 70%, that's what would ruin my performance. So don't worry about the outlier, still set the stops and it just means yeah, you close it, you sell a little lower than you wanted to. Very simple, it doesn't matter.

Speaker 1: 30:55

So trying to get emotionally attached to individual stocks, we don't care what we make money with and we accept that we will lose money on certain investments. It'll always happen. It's just the law of nature. You do not make money with the. There has never been an investor who made money on every investment. Look at Buffett. Look at One of his last big buy that he keeps buying is Oxy. He's been buying Oxy since around about here. So I think around about here that was sort of his level of buying. And look what's trading right now. So he's losing money on that and he's okay with that because he's made a lot of investments and Sam made him a lot of money and Sam will lose him some money.