In today's episode, Kip discusses the recent shift to bear market trading strategies, highlighting the challenges and opportunities that come with it. The focus will now be on strategic moves and countertrend trades using the VRA system to navigate this market downturn. Lastly, Kip covers potential scenarios around political influences and economic policies affecting the market. Tune into today's podcast to learn more.

Good Friday afternoon everyone. Kip Herriage here with the Daily VRA Investing podcast. Hope you had a good day today. Well, let’s get right to it. I’ll tell you first of all, for all of our VRA members here, we’re going to have some information to you over the weekend, either a members podcast or just an outline of what our trading strategy is going to be for a bear market because that is what we’ve transitioned to now into a bear market trading strategy. Walk you through our game plan is there, which will be more active trading, not day trading. There may be some day trades in fact, given the opportunity, but that’s not what our goal is here ever.

But if it happens, we’re not going to say no to it, but it’s going to be kind of a hit and run strategy that’s been in markets like this that I’ve experienced. Whether it’s the pandemic or whether it’s the 2007, 2008, 2009 financial crisis or other short term situations like this. We do think it’s going to be fairly short term. It’s, it’s a shorter term trading approach at extremes, using the VRA system to play counter trend moves and then to, to as the rallies start to fail, then we go in the other direction. So we will be investing in both directions. Again, we’re going to walk you through it step by step as, as we always try to do. Every trade we put on, we’re going to explain why we’re doing it and then what the objective is. Okay.

[00:01:22]:
We took a lot of, we sold a lot. I mean, it turns out it was a pretty good day. Now if you’ve been with us for a while, it turned, you know, say for a year or so. Yep. You did very well. Right. We’ve made a lot of money in Bitcoin, made other profits in other positions as well in our, in our mining stocks, made money in our Chinese tech stocks. Of course, we didn’t do well in the leveraged ETFs, those other leveraged ETFs we held.

But net, net, it was a good day yesterday. If you’ve been with us a while, if you’re newer, yesterday probably sucked. Okay. And all I can tell you is this came quick. You know, we’re talking about five weeks of demand destruction, five weeks of unbelievable selling pressures because again, we started saying what I’m about to say now over a month ago. Incoherent terrorist strategy, reckless tariff strategy by the President and the financial equivalent of Operation Warp Speed, that’s what we’ve seen here. So we’re going to lay this out for you this weekend. What our game plan is.

We’ve kept our core holdings, our VRA10 baggers, obviously kept keeping physical gold and silver. We did sell bitcoin and I’ll probably get that, as I said yesterday. But the reason we sold it is I think we could see a liquidity of it here before this is over. And with the last two days we’ve had, you know, again, we’re with Monday. Monday’s open, could be tough. Okay. And so we want to be positioned for that capitulation on Monday. But anyway, that’s the, that’s the gameplay we’re going to have going forward.

[00:03:02]:
We’ll look to buy bitcoin back. It’s. We traded in and out of it now twice. We’ve made gains of just over 2,200% since 2021. And so we’ve done very well in bitcoin. When we get back in it again, it’ll be for the final trade, you know, or as I said, final cycle trade to our target of 350,000 for, for this cycle. And then ultimately, you know, we’ll be in bitcoin when it hits a million and then, and then past a million. So this is only, our moves were only designed to protect ourselves from a kind of a worst case scenario.

Because if this is get Trump as, as we’ve been explaining to you, look, Trump didn’t build list. I, this is not beat up on Trump day. Okay? But it also needs to be said. I don’t hear enough people saying this. You know, the Trump, the MAGA crowd is all in on Trump. And believe me, I get that. I just don’t operate that way. Right.

We had problems with Trump during the pandemic, certainly had problems with operation warp speed and the creation of the jabs, which are still being given. Trump’s been president now for what, almost three months. These jabs are still being given. They’re still on the children’s immunization schedule. That was criminal to begin with. Why is it happening with Trump as president? So, yeah, we’re going to call things out as we see it. That’s criminal. And especially now with RFK Jr.

[00:04:22]:
Running HHS. There is absolutely no excuse for these things being on the children’s immunization schedule. I think I saw 10 to 12 million kids a year are taking these because the parents don’t know better. They’re on the immunization schedule. And so parents just go hey, whatever you’re supposed to give them, give them. Okay? Again, Trump’s been in office long enough to get those things off it, so I have a problem with that. But what he’s done here, again, it’s been reckless, okay? But the problem is he hasn’t built a coalition. If you notice, he’s got a tight circle of people around him that, you know, financial, financial types that are very bright, but there’s no coalition beyond that.

There’s no coalition with the Federal Reserve and unfortunately that’s, they, they run this shit. You know, you have to have a game plan and a relationship and a coalition with the Federal Reserve or you’re, you’re on an island and you’re by yourself because they run everything, right? The most powerful cartel in the world is the banking cartel. So you can’t just say to hell with you, right? Because when you need them, like you need to have a coalition for now for a very complicated, complex tariff agenda which is, you know, getting revolutionize the American economy, it looks like almost entirely you have to have that coalition. There’s no real global coalition because Trump is also targeting our allies. So there’s no reason for them to want to help. So when you’re, when you’re, when you’re a man on the island by yourself, a lot of bad things can happen there. And that’s why we’ve made the moves we’ve made and it’s why we will be looking to go short this market after we play. Well, I think we’re going to get a sharply lower open on Monday because again, you’ll get a lot of selling over the weekend from people opening up the 401k statements.

You get a lot of people going online say, okay, just get me out, right? We’re in a bear market down 20%. A lot of my stocks are down 30, 40%. Can’t take us anymore. Get me out. So those sell orders will go in Monday at the open and that’s why you get these Monday morning capitulations. And so that’s what we’ll be looking to do, is look. We’ll look for the vix. The VIX that they spiked up to, believe it or not, 45 today.

[00:06:41]:
Vix is up 51% today. Okay? That’s one of the things that needed to happen for us to get to a capitulation event. We needed the VIX to spike. It’s done that now. The only time that VIX has been higher has been the plan Demic where it hit 85. Okay? We’re halfway there, you know, and this isn’t the plan D. We’re not sure exactly what this is yet. But we don’t think it’s a pandemic.

We, and we don’t think it’s a financial crisis either. Okay. So I think that we can rule those two things that’s more like the pandemic than the financial crisis in that it’ll be shorter in term and it won’t have the destruction that came with the financial crisis because of course housing is now so strong. 40% of homeowners own their home without a mortgage. Net equity homes at all time high. It’s almost impossible and frankly I think it is impossible. Okay. Unless a real worst case scenario to have a housing crisis when, when 40% of the of of homeowners own their home with no mortgage on it.

That’s something else that makes this economy very vibrant, makes it very strong. The ability to lever up is unprecedented here. That’s going to protect, protect us a lot to the on the downside as well. So again that’s the key point. We needed to fix the spike. It’s doing that now. It did that today. You don’t see a lot of 50% day spikes in the VIX without a, a market bottom coming in the very near term at least for a significant counter trend trade was now again remember the primary trend now is lower.

[00:08:12]:
So we have to start looking at this backwards now. The primary trend is lower every the 200 day moving app. We’re below all of them. They’ll now begin to roll over. That means the bears had. This is. This is. I don’t like saying this.

The bears have control of the market now. This could be a short look. The pandemic bear market lasted what a month. This could be short lived. Right, but we need some constructive things to happen before we can even point to that. Today the semis were down 8%. Okay. How many times have you heard us say this? The semis lead market follows.

They led in the way lower. We ignored it to the as much as possible. We started pointing it out when they’re below the 200 day it’s a problem. It’s a problem. It’s a problem. Did not take any action on it. That’s, that’s, that’s on me. But again we know what to look for now.

[00:09:01]:
We need the VIX to capitulate to have it spike. That’s happening. We need the poke call ratio to, to really get extreme fear. Well today that happened as well. The pick call Ratio opened today to 1.6. Okay. Anything as Tyler’s explained to you many times, anything over a point like 71 I think is elevated bearishness. Okay.

1.6 is highly, highly bearish. As the contrarian, that should have been a bottom and it wasn’t. Okay. Now the good news is though, the book call ratio did stay elevated the entire day. Every, every, every 30 minute updates and it was above a one all day. The client final trade was 1.21. Again, the peak, 1.6. So we’re seeing the put call ratio spike, we’re seeing the VIX spike, we’re seeing the semis getting decimated, which tells us there’s got to be a bottom here sometime 8% down today.

But we know what to look for. We want the semis to lead, right. And we want to see the internals improve. Today they were horrible. Advanced decline for NYC was 10 to 1 negative. Again, these are the things you start to see. You go, okay, a bottom is near, at least for the near term. 91.4% down volume day for NYSE.

[00:10:20]:
Again, that’s a, that’s a breath thrust. Okay. To the downside, if we were to get another one of these, you’d be talking about a bottom that might last for a decade. All right. Those are significant looking things that don’t happen very often. Again, unless all bets are off here, unless this is fully get Trump and he has opened that door for himself. You know, as we said, they couldn’t get him with a rigged election, they couldn’t get him with impeaching him, they couldn’t get him by trying to assassinate him. They couldn’t get him as lawfare.

Well, he opened the door for this one with tariff policy that built no coalition in place and was reckless and poorly explained messaging. Horrible, right? I don’t even think that’s something you can argue at this point. Okay. The execution has been, I mean on 1 to 10, it’s a negative one. That’s how badly this has been executed so far. Maybe they’ve got a game plan. I know a lot of people believe, believe he’s got a 40 test game plan. I hope and pray that he does and they come out with both barrels.

We did see some signs of that with Vietnam announced. Hey, we’re coming to the table. Other countries announced, yes, sir, Mr. President, we’re going to negotiate. We want our tariffs to be to zero. Right. El Salvador said it today as well, I think Salvador, Argentina, but. So those are all positive signs.

[00:11:44]:
Okay. And now we need a Capitulation. We’d like to see Trump build a coalition, but the problem again is he’s doing this by executive order. Now, I’m a lifelong independent, okay? I don’t like Democrat presidents when it’s ruled by executive order. And I don’t like Republican presidents either. You can’t build a coalition in Congress to pass laws or don’t use executive orders because number one, they don’t last. Again, another administration and at this rate, we will have a Democrat president in four years. All right, this is that, this is what they could be doing here to destroy Trump and to destroy the Republican Party that’s backed him fully on all this.

If they crash this thing to get Trump, and again, the Federal Reserve controls the markets, it would not be hard to do, especially because Trump has not built a coalition. You can see how simple it would be to crash the market, the global financial system, if that’s what they want to do. I don’t believe that’s what they want to do. Right. Remember, the wealthiest investors on the planet own the most equity. Right? There’s equities, the most stocks, most bonds, the most real estate, the most housing. Okay? They, they don’t want to see the same crash either because they’ll be destroyed and they still own these things. So, no, I don’t think that’s going to happen.

They, they would not destroy their own self interest, okay? So I think that’s a key point to understand. But they can hit it hard enough that would make it very difficult for Republicans to win the midterms. And if we do go into a hard recession with a, you know, a multi year bear market, I mean that under, People understand, this is what we’re talk about as a possibility here unless Trump gets it together. Because this is how they could do what they weren’t able to do to Trump and all these other attempts to really damage him or take him out. This is, this is what they now control. And if you listen to Jay Powell today in his speech this morning, you know he’s not coming to the rescue. This isn’t going to be the pandemic with the Fed coming to the rescue with a bunch of trillions of dollars in bailout money, the Congress isn’t going to do it either. There’ll be no stimulus here.

[00:13:43]:
Right. This is on Trump. Powell basically indicated today he almost is more apt to raise rates because he’s so concerned that inflation is going to skyrocket because of tariff policy. He said, we’re very happy to stay where we are. As Tyler said earlier he looked very pleased with himself today, Jay Powell, very content, very satisfied. Like the cat that ate the canary. Because they may have Trump where they want him. I understand this, folks.

I don’t believe that’s the case. But I think more people in the magic community should be having this conversation because unless there’s significant pressure brought to bear on the president and unless he really has a game plan here, you know, this, this, this could get bad. And so I think that’s why we sold this is why we’re going to a bear market trading strategy, because that is the risk that this pretends. But again, we’re also very close to capitulation for everybody here. I know I’m rambling here, but I want to cover all the bases and I don’t want to do it for 20 minutes. So I’m about to wrap here. What we’re going to be doing this weekend is laying out for you our strategy, looking for a capitulation on a lower Monday open. That might wind up being the low.

So again, April 9th is the deadline. If enough pressure is brought to bear, Trump’s going to come to the table, he’s going to strike deals and we could be out of this thing in a week. Okay. Again, before the eighth month deadline. If that’s what his strategy was to end this thing, then that could still work. But now we’ve had a lot of technical damage done. The bears are in control. So either way, we’re going to have to deal with the bear market strategy.

[00:15:17]:
Just know that. But that’s from a trading point of view, a long term investment point of view. We’re holding out core positions because, you know, they’re our 10 baggers or we like them for other reasons. Okay. And so that, that, that strategy doesn’t change. But our biggest risk is this is get Trump. That’s our biggest risk, folks just know that. And I hope that enough people in Trump’s orbit are talking to him because the feedback we’ve yet to hear from a single person.

We have a lot of big Trump supporters here. We’ve yet to hear from a single person. And maybe this comment will bring some of those in today that has said that they back his approach with these tariffs. Now the long term, we all do. I think everybody wants to see the United States manufacturing base get well again. Right. And the second America get whole again because we’re now, we’re creating more jobs and manufacturing and you know, we’re not, we’re not, we’re not, we’re not holding up every other country on the planet. Okay, that had to change.

I think everybody I know, most everybody I know supports that. Again, it’s the execution that’s been so horrible. And I don’t know anyone that I know, no one that’s arguing about that. So I think because that is now the majority feel big time, this has to be getting back to Trump. Trump reads the room as well or better than anyone, not just politician, anyone I’ve ever seen. And he’ll change course when he needs to. So I think it’s important to apply that pressure. But if we just sit here in silence, that ain’t going to help anybody.

[00:16:43]:
So speak up. Yeah, you’re going to get blasted by hardcore Trumpers. But you know what? Hey, at the end of the day, man, that’s worth it. Who cares, right? We got to try to make sure we get through to them because this strategy is not working and the markets look very ugly. Okay? And again, if it gets Trump, then we’re all in trouble. So, you know, we’ll get to, we’ll get our comments tea out this weekend on what we’re planning to do with Monday’s trading. That applies both to a VRA letter, VRA portfolio and to our parabolic options portfolio. Because I think some great trades are coming here, folks, for that counter trend trade in the other direction.

And again, there are good things happening here. You know, one of Trump, three of Trump’s big goals when he took office was to see oils fall, rates fall and US Dollar to fall. Check the charts of all of these. Did you see this today? Oil down to $62 a barrel, right? So, Jay Powell, explain your inflation story to me. You know, you say you don’t like to speculate and that’s all you’re doing is speculating about inflation. You have no evidence that inflation is going to result, that that tariff policy is going to result in sharply higher. He’s such a phony, right? Jay Powell is such a phony, worsted chair of our times. And again, he’s in, no, he’s in no, no, no mood to help Trump at all.

He basically is going to let him hang himself if that’s what he wants to do. And you’re not going to get, you’re not going to get rate cuts, okay? This isn’t the Democrat President. Trump should not depend. He’s demanding rate cuts again today. That is not going to happen. But again, oil today down to 62 bucks a barrel. This is what Trump wanted to see. You check the chart of the dollar it’s down 9% this year for USD it’s 9%.

[00:18:30]:
You know, it’s a versus a basket of mostly European and Asian securities. But that’s what Trump wanted to see, a lower dollar while maintaining our reserve status. Right, Global reserve status. That’s of course vitally important. And then again rates again. Trump’s got that right. You know, the 10 year now down below 4% right now to 3.98%. The Fed should absolutely be cutting here.

If it were Democrat president, you know that they would. But again, Trump is not going to be helped because he doesn’t have a coalition with global partners. That is a problem, folks. That’s a real problem when you’re all on an island by yourself with a few of your friends. This is when they can dictate policy and will force you to bend your knee to them ultimately or watch everything go down the toilet. It’s a real risk here folks. That’s, that’s why we, again, that’s why we took profits and sold positions Losses as well, of course, because we wanted to raise cash in case we get a liquidity, we get a series of liquidity events. Don’t think it’s going to happen.

Remember as I said earlier, credit markets unbelievably strong. Corporate balance sheets never better, never better for corporate balance sheets. Consumer balance sheets extremely good for the first America, not so much as second America. Although animal spirits have done a U turn. Animal spirits. Now we’re seeing a negative wealth effect. Understand this, understand that when negative spirits go bearish as they have now, consumer confidence at almost all time lows, folks, that you get a negative wealth effect. That means you get job, you get firings happening.

[00:20:09]:
A lot of, a lot of, a lot of, a lot of people getting fired and you start going to a kind of a doom loop right where you just can’t get out of it. That’s the stagflation people are talking about. So understand this is a possibility. We still see low risk of a recession, but that’s only if this gets resolved fairly quickly. So we don’t have a worst case scenario. Housing market, again, very strong recession risks are low. This is more like the pandemic than it is the financial crisis. But the risk are there that things could get worse.

So speak up if you have an issue with what he’s doing because I believe more people should. So we really get the message to him. Let it, hey, let us know what your game plan is. You know, let us know, just tell us, communicate that to us because they still haven’t done that yet. No one’s really sure exactly how this is supposed to work. Again, these are all problems. Okay? All right, folks, we’re back with you over the weekend for Get a game plan. Some great trades coming up.

Again, we’re going to be trading both sides of the market here. Now, you want to stay with us? We’ll lay it out for you. Exactly. We’re going to have stops in place or our losses are limited. We have a. I’ve done this, okay, multiple times. I think some of my best runs, okay, had been in this kind of a market. You can make a lot of money in a short period of time.

[00:21:28]:
Just stay locked in what we’re teaching you, okay? What we’re trying to tell you here, because we know that game plan. We have that playbook in our arsenal, all right? We really do. And we’re looking forward to using it and getting back on the right side of the market. And then when this thing bottoms and we’ll have a bunch of cash, we’ll be buying Nvidia, right? We’ll go back into the semis. We’ll be adding to Tesla aggressively. I think Tesla, that’s going to do really well. It’s down 10 today, but I actually bought more Tesla today. I pretty much buy it every week, if I’m being honest here.

Okay, we love Tesla in the VRA portfolio because we know what’s going to do in the long term. But we’ll be getting back into Bitcoin again. We have a lot of cash to work with. And these trades that we’re going to put on, add to that cash, a balance sheet. Stick with us, folks. Again, I hope you had a good week. I know this is really tough. You have to understand what you’re feeling.

I will have to tell you, in all modesty or whatever, it’s a hundred times worse here, folks, because I’m getting your emails, I’m talking to you, getting your phone calls, your direct messages. And again, I think one of the reasons that we’ve beaten the market 18 to 21 years and the reason that we’ve done well is because we actually care, okay? I cared on Wall street about my clients. One of the reasons I couldn’t wait to leave because of the pressure of dealing with, you know, $100 million and just not being able to watch people lose money in a tough market. Got to be over 15 years. I think one of the reasons we’ve done well in the vra, I think this is the key reason, is that we care. We care because we’re doing exactly that. Money, what we tell you to do with yours. So we’re all on the same side of this, right? There’s no conflicts with that.

[00:23:09]:
Okay. We’re not a brokerage firm. We don’t get paid commissions on you or anything. We charge you a flat fee. Here’s what you charge it. Pay you a year. And so that’s what we do. Right.

There are none of those scummy conflicts of interest. But I think that’s why we’ve done well, because we actually care. I hope you understand that. We’re right here with you. We’re going to get out of this together. I think this is going to be fairly short lived, but we want to make sure we’re positioned either way so we don’t have a lot of exposure. That’s what our game plan is. It’s a balancing act.

Okay? Just know that that’s how we’re viewing this and we’re going to come out of this stronger than ever. I can almost promise you that. Okay. All right, folks, listen, have. Have a good weekend. Treat yourself a little bit. Go have, go, go blow some steam. Go do.

[00:23:50]:
Take your significant other out and have a great meal and take some deep breaths and this is all going to work out just fine. Okay? All right, folks, appreciate you very much. We’ll see you back here over the weekend with our game plan. Kind of a step by step, if you will. All right, bye.