Oh, in this video, we're going to talk about retail capitulation. We'll have a note about Bentley and what it says about a Tesla. We'll also talk about what retail buyers are thinking about Tesla talk a little bit about inflation protection and of course what Barons just told me about one of my favorite stock sectors. But first, I have to address this random comment: I Got yesterday somebody's like Kevin do you do you have an obsession with always showing us that you're holding coffee is is do you have a problem and I'm like yes I I don't understand common sometimes but honestly I love the collection of coffee mugs that I have.

This is a super restore potion and I only have like seven cups of coffee a day so it's totally normal and not a problem demand coming from China Remember that the Chinese consumers the higher end consumers I should say really like nice cars and there's a potential that if we're starting to see a drop off in luxury cars over at Bentley which is historically something unique, then that could potentially also explain the drop-off in demand that we're seeing in China for Tesla which would isolate the demand drop off for Tesla to China rather than to the rest of the world now. I Did a pretty deep analysis on well on my thoughts. Okay, I I don't want to make it seem like it went ridiculously deep here, but I went pretty deep on some of my thoughts on both trade desk and Tesla in a course member live stream two days ago. and I want to know from you should I Was thinking about as just sort of a free sample posting that entire analysis.

It comes with my price targets for Tesla as well. If you want to see that, just leave a comment down below and go post the Pp live stream in honor of the coupon code expiring Friday which gets you lifetime access to anytime. I Go Live in the Course member livestream. Okay, so this is interesting to me because China's clearly having economic issues at the same time as now the pull-up Bureau and the government the Chinese Communist Party are essentially suggesting hey, you know what? We're going to go ahead and pull back some more of the covid curbs once again now finally allowing individuals to quarantine at home rather than a quarantine hotels if they're otherwise as safe and not a threat to other individuals.

This is a big shift. We've always seen these coveted curbs kind of trend down where. Okay, instead of spending 10 days in a coveted hotel, now, it's five days. now.

it's potentially zero. It's a pretty big shift, and it's a continuation of the likely gradual and Rocky exit we're going to see China go through from Covid Zero. Keep in mind, the Economist says there's really no win-win solution here, because if they reopen too quickly, they have not actually prepared the Chinese people enough to be ready for a full-on Covid storm that is the Economist injecting potentially as many as eight hundred thousand people could die and there could be five times the demand for ICU beds as ICU beds are actually available in China with a full covid uh elimination or or coveted restriction elimination, right? So in other words, all of Cove at Zero just being turned on its head and just a full-on reopening could lead to a complete disaster. Now on the other hand, as we talked about a couple days ago, the slower China escapes from sort of these uh, coveted zero restrictions.

potentially the longer they will continue to be an anchor for Global inflation, which is actually somewhat a good thing for the rest of the world, not just potentially for fewer deaths happening in China but also potentially for helping inflation stay low because if China just goes right back to booming, gonna help push up some more inflation. One of the reasons Oil, by the way is falling right now, which is nice. I mean we just went under 80 a barrel and I mean this stuff fluctuates on the daily basis, but Brent Brent's right at 80 right now. Uh, the Western WTI sitting at about 75 bucks we're negative for the year on oil.

It's actually pretty shocking. But uh, we've got to talk about retail here Right after I mentioned that yet another Equity Fund has a limited withdrawals. Can you believe this? First Blackstone's non-traded Reit limits withdrawals sorry, can't get your money out then Star Wars Non-traded Reit limits withdrawals Now Blackstone's private Equity Fund The largest business development company in existence with over 22 billion in assets under management has hit their cap of five percent withdrawals. In other words, everybody's trying to get their money out of everything to increase cash.

Cashola cash is King in a recession of course somebody that I'm gonna bring up here another YouTuber apparently does not think so, but I am a little bit confused by their tweet. We'll handle that in a moment. But first, we need to address some charts: Retail flows are starting to fall before data releases. Now this could be normal.

Uh, personally. I Actually think this is the smart thing for retail to do. I'm gonna move myself here. I Think that when you go into reports like a CPI reporter fomc report, generally you would expect to see the lowest inflows because why would you buy right before reports? Right now you could potentially, uh, you know, buy the dip right before reports.

But anytime you have a critical report like the CPI inflation report coming out on Tuesday which is in six days, why why would you throw money into the market when if we get a bad CPI report, we can see all indices down five percent before you even have a chance to sell. uh I mean and remember, the CPI report comes out before the Market opens. So even if you're like oh, I'll set stop losses, those probably won't trigger until the Market opens. Okay, Okay, so so you know it.

kind of kind of sense people like, you know what? Let's just wait and see. Anyway, this chart here. the purple line is what Uh represents retail inflows according to Vanda track and it's plummeting. Uh, you know we are almost at the lowest levels that we've seen for retail inflows all year long, right here.

uh, with only really after drone Powell's Jackson Hole us having a lower time uh, similar to what we briefly had there around the bottom of the market in July although we did hit a further bottom after that, which you could actually see exemplified here. Uh, and here. So I Guess this was a little bit right after the bottom of the market. but anyway, you get the idea.

Okay, so uh, what else do we have? Well, look at this particular chart. This is retail purchasers of purchases of individual stocks on a rolling 21 day basis and what you can see is that AMD has been relatively stable. You can see that Amazon has kind of dropped off after a little bit of a rally. over here.

you've had Netflix drop off Microsoft Drop off Facebook Drop off Uh, and Apple drop off pretty much every single stock retail heavy. Uh, which. these are really the large cap stocks, the ones that kind of everybody has in their portfolio. Almost almost all of these have fallen off in the last month-ish here for retail purchasing with the exception of one baby.

And that one is the gift that keeps on giving Tesla And it's the gift that keeps on giving because as you can see here, the more the black line goes down which represents Tesla's price, the more retail does the apish thing it says Ah buying this, give me some more Q when the P goes down I increase my Q look uh, that's me too. Okay, like this: this chart is me: I I I I like it I like it I like price go down I buy Tesla Okay, I like but I Also, I Also realize that even though we expect Tesla to go to the moon at some point in the next five years, if I had any need for my Capital within at least the next two years, I probably would not be doing this and I certainly wouldn't Advocate this Look, you all know this. You know I'm a licensed financial advisor, You know I run an ETF You know I'm a real estate broker. You know I've got educational courses coupon code PP expiring Friday Okay, uh, with new content coming out this month.

This is not to give you personal financial advice, but I'd like to be very, very clear here. Buying the dip in a recession is a wonderful, wonderful strategy if you're not interested in trying to play the timing the market game and you have that long-term belief that what we are seeing is actually value. and in my opinion, I actually think we see value at Tesla now I'll uh, if if y'all want you, leave those comments and I'll release my longer thesis on Tesla and my commentary on price targets. just leave leave a comment down below I'll do that later today, but you've got to think about it this way: If you actually think that Tesla's going to grow at at least 45 percent in earnings per share, the recession protection story is actually still present I Know that sounds insane I I Know some people are going to go how the thing's down 50 this year I Get it? A lot of things go down a lot and this is no exception.

But you've got Twitter Overhang. You've got China Overhang, right? You've got. You've got a lot of issues going on. I got Elon selling overhang If Tesla grows at 45 uh, at a 45 percent basis on its earnings per share during the 2023 recession every quarter, just 45 45, 45 45 or more or more right? Could be 50, but I'm just gonna go with 45 percent and their forward P E ratio right now is sitting at somewhere around 40.

That puts their PEG ratio at under one. That is a really good deal for growth. And it's not just not just Tesla that's starting to look like a really good deal for growth. it's actually also companies like this right here.

Barons did a great piece on this and I Believe in this AMD video some of the other chip manufacturers. These are high pricing power companies. These are high margin companies. and maybe just maybe most of the pain has already been priced in no guarantees, no guarantees.

Things can go absolutely crazy. But anyway. uh, in addition to seeing individual stock purchases plummet, another thing that you're actually seeing is you're seeing investments into energy finally start to roll over with retail investors. Now this is an interesting one because a lot of people were really following uh Wall Street into oil companies.

But now that oil has gone negative uh, year for the year. Which basically just means it's a lower price now than what it pre what it was at the beginning of the year, you're actually seeing retail purchases of oil stocks plummet. Look at that plummet? I mean we're we're almost at, uh, some of the lows that we've seen this year. but uh, we're definitely on that massive downward trajectory here.

Another thing you see is that the uh, this right here is the S P 500 this top dark blue line. This right here represents your call put premium which is just basically a ratio of if you divide calls by puts how expensive are calls and you can see that calls right now are actually at probably the least expensive level that we've seen since before the pandemic, that's pretty remarkable. Pretty remarkable. In addition to that, we are seeing retail net purchases of individual stocks overall plummet at the same time as retail purchases of ETFs are declining.

This actually implies that people aren't doing the typical seasonal tax loss harvesting see Usually what we see is we see a plummet like over here you see a plummet in stock purchases and you see an increase in ETF purchases plummet and stock purchases increase in ETF purchases. The reason people do that is is to tax loss Harvest while still having exposure for so for example, you sell Tesla and then you buy a stock that has you know I don't know a 20 exposure to Tesla uh or an ETF that has a 20 exposure to Tesla At least you still have some upside while being able to avoid potentially the the wash loss. Uh, The wash rules which if you're not familiar with tax loss harvesting, talk to a CPA do some Googling on tax house harvesting you sell you have to wait at least 30 days. You can't buy a derivative which is like an option.

You can't buy something substantially similar, right? So usually people end up taking an ETF but you're not actually seeing that right now. which is interesting. You're just seeing a decline in both. You're seeing outflows in both which I personally think is a sign of people raising cash which I think is a smart thing to do I've been saying since January that the best asset class this year is likely to be cash I wish I believed in myself more.

Well, it wasn't that I didn't believe in myself more I just saw really good deals in the stock market I started spending my cash. Uh, but I wish I held more cash this year. It's the one thing I wish I did more of this year and I talked about how cash was going to be the best hedge against inflation in 2022 and people got so mad at me they're like, how stupid are you How stupid are you to say that when inflation is eight percent, your best hedge against inflation is Cash like your cash is just losing eight percent in value. Well, there are two ways you could look at this one.

You could say yeah, maybe my cash lost eight percent value, but my stocks lost fifty percent in value or 20 of value. Whatever you were investing in, right? That's one way people people might look at that. So like cash is not as bad, but that's actually not the way I look at it even though it's a pretty simplistic way to look at it. I Think the The way that takes a little bit more logic to think about is this way: if your cash is being used to buy food or gas or rent, then yes, your cash has lost money.

But if your cash was actually being used and you waited patiently to buy stocks or bonds basically assets that ended up declining in value, your cash. PP Your cash purchasing power actually increased. It didn't go down. it increased.

and this is what I said in January said cash is not trash. When assets go down, your cash becomes more valuable if that's what you're buying. So you're actually having deflation right. Assets are deflating, making your cash more valuable, not less.

And this is where I'm like dude Graham Freaking Stefan What the f, What are you doing? Somebody here. you know this person goes well. well. Graham goes what's the best investment you've made this year? Somebody goes not investing I mean they're actually not wrong.

That's that's a very smart statement. like yeah, looking back it's like damn the money I didn't invest was good and then the reply here is it's not like cash was a better option with high inflation. Like what? Yes, it was guys I wanted to shake you like yes it was Cash was the best trade in 2022. Any fund that had a large cash position killed it in 2022..

what are you saying? Ah sorry I had to get that out of my system Anyway, 10-day net retail purchases with leverage and without have overall declined leveraged purchases and non-leveraged purchases. Well, I'm sorry this is leveraged ETFs With leverage or without, this would be like a triple QQQ or a short QQQ right so or or like a one and a half X Tesla Whatever purchases of Leveraged ETFs have just overall been declining whether they've been with leverage uh or without which basically means are using margin to buy a leveraged ETF It's it's this is this chart is telling you: risk off Okay, retail's shutting down and I think that's really what's happening here is you. You just have retail shutting down. Sky was like, you know what? Mic Drop Peace I'm gonna take my time I'll come back I'll come back when things are different I Do think that a little bit of of what's Happening Here Short U.S Equity ETF Purchases I mean here this shows the inverse: ETFs Sqq You see a little bit of rotation down here though.

This is a pretty noisy chart. I Do like this chart a lot because it just shows you where the retail purchases are really going. in the last five days. Over here, it's mostly Tesla followed by uh Apple Amazon video that's a great one AMD Great one I Think these guys are knocking on the door bottom I Think Meta is a massive mistake I Personally would not bet on the Chinese consumer although the stock has gotten pretty darn inexpensive.

uh I for me I think Meta is is a dumpster fire I think Mark Zuckerberg's got to go with his his metaverse idea uh I think Facebook should should should get really good at ads and and stop trying to play the 20-year bet. Uh, at least not with the amount of money that they're spending into it in a recession. I I Don't know. that's my take Uh Lucid I think this is a bankruptcy risk right? here you look at my video.

uh, you just YouTube uh Lucid Rivian Bankruptcy Meet Kevin you'll see it Taiwan I Like this uh Apple's huge partnership coming up oxy I think actually is a good Market Hedge not opposed to this Uh I do not like the valuation of Activision Blizzard I think it's really been propped up on the idea of the merger with Microsoft and uh yeah. I'm not gonna go down the rest of this list here. You can kind of pause it and look. I I I've been personally I Have to say I've been tempted by a firm but boy the risk is high.

the risk is very high I've been tempted by it. but I haven't been in a firm for a very very very very very very long time I'm actually surprised I don't see oh there's end phase I was looking for it. it's way down over here by Delta uh anyway, so uh, let me know. comment down below: PP Course member live stream or something to that effect and uh, and and if we get enough likes and comments on on that idea I Will uh reveal this this like hour-long live stream uh sample on trade desk and Tesla I actually think it's It's very informative.

It's roughly what we try to do on a daily basis. Gives you a good sample and it provides some more insight into Tesla which I think a lot of people are asking for right now. Anyway, thank you so much for watching! Cheers my friends! Good luck on your trading day! I am flying to New York baby! let's go.