In today's episode, Kip discusses the volatility affecting US markets and the impact of President Trump's latest tariff policies. We'll explore how these policies are impacting not just the markets, but also the very supporters who helped elect him. Plus, Kip covers the record highs in gold and the bullish outlook for gold miners and junior miners. Tune into today's podcast to learn more.

Don’t look back to the market is closed. Good Thursday afternoon, everyone. Kip Herriage here with the daily VRA Investing podcast. Hope you had a good day today. Tough day in the markets again today. As we close out Thursday, we are down 4.3 to 4.8% in each of our major indexes for the week. We are at new lows and everything except NASDAQ and Russ 2000 now is down 19% from high. So we’re very near to a bear market here and small caps.

I’m going to talk a little bit today about tariff policy and about the president and his team’s approach to what’s happened so far early in his administration. I just have to make the obvious point here. Tyler and I just had our pre podcast meeting and you know, we know from hearing from you is this is really from everyone that we speak with. I hear it online, social media, Twitter. This is a very consistent message we’re hearing from everybody is what is he doing? Because think about it this way. This scattershot approach is not, there’s really, there’s nothing systematized about this. It’s like someone playing blindfolded darts. Okay, why would you want to do that? It’s not required.

[00:01:06]:
This morning, Trump puts out via Truth Social, not even an official, you know, message or report puts out via Truth Social that he’s going to implement 200% tariffs on European alcohol makers. You know, it’s, it’s just kind of getting this random approach that’s making it very hard for people to make sense of what’s going on here. Confusion is what the markets like least. Okay? So that’s what we’re seeing in the broad markets here. There’s just no doubt about it. It’s making the Bears job very easy. It’s making the shorts job very easy. So I’ve got two thoughts on that.

Number one, the people being hurt. Think about this is how strange and off this is. The people being hurt the most right now are Trump supporters, the ones that fought to get him reelected, the ones that lost friends and family over this, over politics. How messed up is that to begin with, right? But people that have really put themselves out there to support Trump and again, maga, Make America great again, are the very ones being hurt the most. Because think about it this way, the liberals, they didn’t trust Trump anyway. They didn’t believe in Trump’s tariff policy anyway. So they’re out of the market or they’re short. We know what Wall Street’s doing.

They’re aggressively short. These are not Trump voters. Okay. Talking about the, you know, the, the ivory tower guys, the hedge fund guys. Right. The professional money, if you will. They, they’re short. They didn’t vote for Trump and they’re winning.

[00:02:43]:
The people being hurt the most. And that’s how wrong this is, in my opinion. I talked to a lot of people trying to get a message to Trump, and the feedback is, it’s not going to matter. He’s going to do what he wants to do. That is, you know, that’s what Trump’s always done. But, you know, it is, it is. It seems demented, really, that we’re the ones being hurt the most because we, we believe in Trump, we believe in his economy, and we believe in his terror policy. I believe in all of that.

And I think this is all, I still continue to believe Tyler does as well. This is all going to work out just fine. Well, you know, we’re now down 14% in NASDAQ again. Russ 2000 down 19% today. SB 500 closed down over 10%. Being in official correction territory, I don’t even have a problem with that. Shakeouts and corrections are part and parcel of every bull market of my career. Done this 40 years.

That’s, that’s not what concerns me. What concerns me is this doesn’t have to be happening. It doesn’t have to be this way. Scott Besson today. This, this also, markets dropped on this. Okay. Scott Besson was asking about, is he concerned about the markets falling? Is. No, I’m not concerned about a little bit of volatility in stocks.

[00:03:59]:
Do you feel like there’s been a little bit of volatility? Because I don’t, I don’t. So I don’t understand this approach. I think it is completely backwards. As I’ve said before many times, I believe the smart approach would have been to get the economy rocking and rolling as it wanted to do after the election. The markets were going parabolic, right? They would have continued to go parabolic had Trump focused on the economy, on tax cuts, on deregulation, doing his thing like he did in the first term. That’s what everyone was expecting and hoping for. Instead, almost right out of the gate, what does he start talking about? Tariff policy. And again, there’s no, look, I’m a Trump supporter.

There is no rhyme or reason to his tariff policy. It just not. Has not been. And I’m a, again, I’m a huge supporter. And what he’s doing, tariff wise, as long as it systematized, as long as, okay, you can look at and make sense of it. Very hard to make sense of this because every day it seems to change. So that’s the point that I’m making here. I don’t think anybody on the.

Honestly, I know, I know you guys pretty well. I don’t think there’s anybody on this that would disagree with me. Right. Especially the fact that we’re the ones getting hurt the worst. That just seems very backwards and wrong to me. I guess it does to you as well. But we had some bright spots today as well. Gold today, $3,000 an ounce, all time high.

[00:05:21]:
We’ll talk about that a little bit. And I do think that while we’re talking about Trump specifically, I do think, look, if this is 40 chess, when we’ve seen him play it before, I do think I see an angle here that could really work. It might even start next week. Okay, let me lay out for you. All right. And I think this is what’s going to happen or I wouldn’t be saying it. One of the things that has not happened during Trump’s second term is he has not been out there aggressively targeting Jay Powell. Yes, he said rates should be lower, but there have not been these ongoing regular, regular attacks against Jay Powell that’s different from his first term.

So my thinking is, my hope is that Scott Besant, who should be the guy communicating with Jay Powell and the Fed has been doing that. And because this would be the time again, the Fed meets next week. Okay, Fed meets next week, Tuesday and Wednesday. This would be the time because look at all the inflation indicators, the cpi, ppi, both were beats this week. We know that inflation is a past tense story. The tariff thing is tariffs are 13% of the U.S. economy, GDP. Right.

The tariffs are not going to result in higher inflation because everywhere else we look, inflation is really falling off sharply. So again, lagging indicator anyway. So it wouldn’t take much for the Federal Reserve to come out and say this week, look, we’re seeing that the economy is weakening. We see it airline price, all the transportation, airline prices we’re seeing across the board see it in the stock market again as a leading indicator. Okay. We’re seeing all these things point to a lagging, a slowing economy with it makes common sense with the Doge cuts, et cetera. Right. So, yeah, economy is slowing.

[00:07:11]:
There is no doubt about that. The economy is slowing. So this would be a perfect time for J. PAL to come out and start messaging, as I believe you will, about resumption of their, of their rate cutting policy. Again, they Meet Tuesday and Wednesday. On Wednesday we get the, at 2pm Eastern we’ll get the statement from the FOM see. And then of course 30 minutes later J. Pal’s presser.

If, if Besant has been working with, with J Pal, a coordinated message here would not, you would see a short squeeze of order of magnitude because that’s how this market is set of extreme oversold. Seasonality is flipped to bullish again. We’ve got all of our sentiment indicators at extreme fear and yet the shorts now coming in aggressively. So it wouldn’t take much to get a short squeeze and put a bottom in this market. And then you know, you gotta have to hope at that point that Trump actually develops a, a game plan for tariff policy because right now it is just scattershot. I don’t, I think that’s probably the right, right word for it. Sloppy is another word because again this isn’t necessary. And by the way, when we talk about stocks being down, down 10, 12, 14%, those are the indexes.

Most stocks are down much more than that. So that’s what people are really feeling because a lot of people on individual stocks and they’re being hit hard. Okay, So I think here’s the thing. It doesn’t take much for this kind of thing to snowball. I mean NASDAQ’s only 6% away from bear market. We’re talking about another week like this one. So all of a sudden you get a bear market in stocks and now the recession possibility starts becoming much more likely. Even we would flip from saying it’s laughable as we’ve been saying, laughable right now to think there’s going to be recession.

[00:09:04]:
But once you get into bear market territory, people start liquidating the 401s. It’s like a self fulfilling prophecy. We talk ourselves into a recession. That’s how they happen. It’s the wealth effect in reverse. If that happens because bear markets and recessions are not short term. You know, unlike the, you know the, the what we had with the pandemic, you know. Yeah, we had a recession, right.

But it happened all at once. Next thing you knew they’re putting money like crazy. The markets were closing the same year in 2020 back at all time highs. Right. So but that’s not the normal bear market and not the normal recession. The normal recession of bear market are saying these take time quarters to get out of. So you see where I’m going with this. It won’t be long until we’re at to the midterms.

It won’t be long till Republicans are getting swamped in the polls, because who needs this? Who needs this, right? We didn’t vote for this. And again, I’m a huge Trump supporter outside of the pandemic. I’ve been across the board a supporter of Trump, but this is sloppy. And the American people are down 15, 20, 25% in their portfolios in three weeks by supporting their guy. So this is a problem. I think the message that everyone should speak on social media, wherever you have a voice to get a message to Trump and to Scott Bessant, speak up, let your voice be heard. Because this policy is unless they have a game plan of 4D CHS this week, with the Fed meeting, et cetera, it’s time to show us what your, what your, what your game plan is. Because right now it’s, it’s, it’s.

[00:10:42]:
We don’t care. And we’re not paying attention to the stock market. That, that’s not, that’s not what we want our government officials to say ever. Okay? Ever. Because we, we certainly. And I, look, we know Trump cares. Trump, Trump follows the markets more closely than any president ever. We know this well from first term.

He follows the markets. They absolutely matter to him. And of course, Scott Bessant, too, who’s a Wall street hedge fund guy. So obviously, you know, they’re following the markets very closely. To say you don’t is. It’s offensive. It is offensive. One second.

All right, let’s take a look at a couple of things. Again, I’m a supporter of Trump’s terror policy. I think it was. We had a great example of it yesterday. Trump had the Ireland prime minister and you know, they’re in the White House and they had a presser. And of course, Trump fills most of the questions, but, you know, he had a chance to lay out the difference in trade in the reason we have a trade imbalance. For example, with Ireland, which is $91 billion a year, that’s the fourth largest trade imbalance that we have. China’s the largest at near $300 billion a year.

[00:11:57]:
Mexico is second at 180 billion. Vietnam is third at 115 billion. And in Ireland at, again, 91, 92 billion. And he said, look, here’s what happened. And this is starting in 2013, Obama backed and approved countries having the ability to leave the US and go offshore, in this case, Ireland. Ireland approved an incentive and attack corporate tax rate of just 12.5%. And it attracted companies, moved their headquarters. These companies did Apple, Google, Microsoft, Pfizer, Johnson and Johnson, Medtronic and Intel, that’s just a few.

So they moved to either their headquarters or major distribution and manufacturing to Ireland to take advantage of that. Trump’s quote at this was perfect. And again, the Ireland prime minister just sit there and just shook his head because everything Trump’s saying is true. Trump said, I don’t fault Ireland or American companies from taking advantage of these low tax rates and incentives. They were smart, our leaders were dumb. But I’ve been president, here’s what I’ve done. I said, hey, you want to go ahead and move to Ireland, go for it. But when you try and sell your products back in the US you’ll pay a 200% tariff on all of them.

That’s what we’re doing now to rebuild our American economy. Again, makes perfect sense. This should never happen in the first place. Horrible. US Leadership allowed it to happen. Of course, no doubt this is how these politicians become worth 100, $200 billion shortly after leaving office. Okay? It’s by exactly these backdoor deals that do that hurt the American worker, hurt the American economy and to just simply to line their pockets. So Trump’s saying the quiet part out loud and again, I think we all agree with this, but again, it’s got to be much more focused and the messaging of his terror policy needs to be much better.

[00:13:55]:
It must be much better because this is not working for anyone. What else here? All right, let’s move on today to the internals. I want to talk about a little bit about gold today because again, $3,000 now. So the first time the miners are doing real well. Check this out though. The miners, the miners haven’t even got back to their gdx, the gold miner etf. The miners still haven’t gotten back to their site, to their, to their one year high. Okay, they’re still not even there.

And guess what? You have to go back to 2011 to find GDX at its all time high. Okay, so here’s gold marching ahead. And the miners. Now there are some other reasons for this. It’s part of the, the construction of the etf. So, you know, again, it’s some dilution, if you will. They print these shares and management fees take value as well. So it’s not a, it’s not a, it’s not a true dollar for dollar comparison.

But still it definitely holds up because we see it in all the other public companies in the mining space. GDX has to jump from here, 32% to get back to its all time high. In 2011. That gives you an idea of how cheap the mining stocks are. They were up today 3.3% for GDX, 3.3% again gold today at closing over trading of right now trading over $3,000 an ounce for the first time ever. But let’s take a look under the hood today. Eternals again. This has kind of been the consistent message of the week.

[00:15:29]:
The internals were not bad today. I mean they weren’t good. But you know with these kind of losses we’ve seen, especially with them starting to pile up into snowball, the internals just haven’t gotten horrible. 2 to 1 advanced decline for NYSE again that’s par for the course frankly on just an average down day. NASDAQ a little bit worse down 3 to 1 advanced decline. Volume today, down volume 70% for both NYSE and NASDAQ again I would kind of expect that these days we’re leading to 85, 87% even 90% down volume days. We’ve just not had that yet. I think that tells you that either we need a flush or this is going to turn around here very quickly.

What is starting to pile up are the new 52 week lows. Today we had 564 stocks in a 52 week low. Again that’s NYSE and NASDAQ combined to just 52 heading into 52 week high. Those are all miners by the way. Those are all mining stocks and material companies hitting a new 52 week high today in our sector watch. Again this is not good. Every sector at one finished lower and frankly it should have been across the board. And I just lost my sector screen here.

Just stopped updating. I don’t see the returns today. My bad. But I got nothing. I just know that all but one sector in those utilities were lower on the day today. In our commodity watch today again a fantastic day here we got one second. These, these screens all update at 5:00pm Central. So I’ve got it saved on a different screen.

[00:17:13]:
Here we go. Gold today at $54 now since up 1.85% on the day last trade. $3,001 an ounce. Silver up but even bigger 2.2% today it’s up 75 cents an ounce at 3,449 an ounce. Copper today up 1.4%. Almost back to $5 a pound now $4.91 a pound. Crude oil today down 92 cents a barrel at 66.76 a barrel. Before I move on, I got to just talk a little bit about gold.

You know, for 20 years actually since 2001, we, we’ve recommended that investors save in gold, your liquid savings in gold rather than in fiat currency. Now obviously you can’t put every penny your savings into gold. But you know, and again, in a long term savings account, instead of using money markets or CDs, we’ve recommended that investors save in gold. Okay? That’s what we’ve done. And we like to practice, we like to preach what we practice. Uh, here’s, here’s the bottom line that. Since 2003. Since 2003, $100,000 invested in, in, in fiat currency, a money market account, okay.

In a fiat currency, just a money market account earning 3% is today is worth 70 less than $70,000 from $2,300,000 worth less after inflation. Worth less than $70,000. Inflation is the savings killer. That same 100,000 invested in gold today is worth more than $700,000. So again, gold’s at three thousand and one now. No, it’s not near a type A top. The manufacturer is trading like it’s ready to go. Truly parabolic.

[00:18:51]:
Remember, our one year price target remains $4,000 an ounce. And if we like gold, the leverage is in the miners and especially the junior miners which haven’t had a bull market for years. They’re now starting to go. We think this move is matter of fact, we’re very confident saying this move is just beginning. They had another strong day again today. The junior miners GDXJ up 3.9% today, outperforming the, this, the gold, the senior miners if you will, which are again up 3.4% today. Outperformance is finally starting to happen in the junior miners. We believe that’s going to continue.

Finally the day bitcoin, again bitcoin is not even technically a cryptocurrency. Okay. It is bitcoin is bitcoin. But again it’s been hit with the entire space today down 3.3%. 80,852 again it’s a, it’s, it’s a risk off market. But what’s interesting about this is that gold is moving higher in the face of this. It tells us something important. Based on past declines.

This tells us what’s happening in the US market is very US centric based. In other words, it’s not happening overseas. Their markets continue to surge. Right. It’s only in the US that tells us is directly tied to Trump’s tariff policies or shorts. Trying to get him is to get Trump right Which I think is absolutely part of this. And right now the shorts are winning the other upper hand. And matter of fact, the president invested essentially had been partners with the shorts, okay, because of their very lazy language and around.

[00:20:24]:
They just don’t care. You know, that’s, that’s the message of shorts to speed up your shorting. So again, hopefully they’re going to trap these shorts and cause a massive short squeeze. But what we’re not seeing, we’re not seeing gold declines. This is key, gold and silver. Because in so many of these market sell offs, gold and silver go lower too. And most people look at it go, wait a minute, I thought gold and silver was supposed to be a store value, at least gold. Why isn’t gold going up that the market’s going down? Well, this time it’s happening.

This time it is happening. And that tells us this is short term. This is very specific to US stocks, very specific to administration policy and to very targeted short selling of US securities because it’s not happening in gold. There are no liquidity events, in other words, right? There are no liquidity events. This is simply a risk off environment for US equities targeted one person and one person’s policies and that is Trump and Besson and their entire economic team messaging has been pathetic. It must be better. The people being hurt the most are us, right? The people that risk a lot to help get the guy elected. So speak up, raise your voice at some point you think you’d listen to us.

Unless they want to lose the midterms and to watch a tough recession and bear market, which I still do not expect. But again, this lazy, sloppy policy is feeding right into the shorts hands. That’s got to change, that’s got to get better. I believe it will next week with the Federal Reserve when they announced they’re going back to rate cuts. What they have to do now, right? The economy is slowing, inflation is clearly declining. They must get back to rate cutting cycle. That will be positive news. That’ll give a floor in the stocks and then we can come back with a more targeted, more smart minded economic policy around tariffs.

[00:22:11]:
At least that’s what I hope the game plan is. All right folks. Hey, always appreciate you listening. Hope you had a great day, maybe a better night. We’ll see you back here again tomorrow after the close.