Today we have a loaded episode covering economic and market insights that you won't hear in the mainstream media. Kip takes a deep dive into the strong reasons to be bullish about the economy and the stock market, much credited to Trump's economic policies that are still in place and the ongoing "innovation revolution." Tune into today's podcast to learn more.

Don’t look back because the market is closed. Good Wednesday afternoon, everyone. Kip Herriage here with the VRA investing podcast. Hope you had a good day today. Got some big topic ideas to talk about today. Nvidia just announced earnings. This, of course, is one of our, kind of one of our big events that were being front ran, if you remember, we were talking about those. The first, of course, was Jay Powell’s address at Jackson Hole that took place last Friday.

And now we have a clear rate cutting cycle in front of us. The second was today, Nvidia’s earnings. I’ll get it that more in just a moment. And then next up we’ve got Friday’s PCe core PCe data. I don’t think that’s a big event. We see disinflation have been such a powerful, really overwhelming theme for the market. We think that continues. But the next step, then we start looking forward to the actual first Fed rate cut.

And I remind everyone, and I don’t hear, really don’t hear anyone talking about this right now, but it’s one of the most powerful investment themes of my career, of anyone’s investment career, frankly. Don’t fight the tape, don’t fight the Fed. Right. With the Dow Jones just hitting all time highs yesterday, backed off a little bit today, multiple sectors hitting all time highs. What S 500, just slightly below an all time high? Nasdaq. I just wrote this up this morning. Nasdaq is roughly 5% from all time high. So fighting the tape has been a fool’s errand.

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Now we’re going to be talking about fighting the Fed. Do you really want to fight a Fed that’s cutting rates with a market that is beginning to price that in aggressively? So I think that, here’s what I think. I think we’re in a period now where the market continues to back and fill. You know, we had a really heavy duty shakeout. Like it may have not felt that heavy because SV 500 only fell about 7%, but Nasdaq fell 13%. The semis fell 28% in a bear market in three weeks. So yeah, the mid July to August of what I guess really a three week timeframe was a pretty brutal shakeout for the markets and it took a lot of short term money out of the market. So I’m actually going to write this up tomorrow.

Talon just talked about this. We on this rally higher and we have covered a lot of ground in a short period of time. The market’s been, had, really had a parabolic move higher from this August lows, but we never hit extreme overbought on our VRA investing system. And what that means to us is that this move is nowhere near being over and that we think these dips will be very short lived going forward, including the one we’re getting right now in the after hours from Nvidia. Before we get to that, let’s talk about the market first. Dow Jones Today, again, we had a very strong rally into the close today. Dow Jones finishing down only 159 points. That’s down 14th.

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1% have been down more than double that, Russ. 2000 a day down 16% to 1%. SPF 100 also down 16th, 1%. And our loser on the day was Nasdaq. They closed down 198 points. That’s down 1.1%. But it had been down much bigger than that. Again, pretty, pretty good smart money hour.

And of course, the semis, which are tell there is no more important sector than semiconductors. And today down 3.8%. Now, some of that came in the after hours with Nvidia’s earnings. So let’s talk about, about that. Now. Nvidia today reported, and again, expectations were so incredibly high, they actually beat estimates, but they didn’t beat the whisper number. The stock right now, as I speak, is down 7.8% on the day. That is off the lows by about $3 a share.

It’s down dollar ten a share right now. Again down 7.8% of the day. What an incredible story this is. Now, remember Nvidia from the all time highs, which are only in July. Nvidia is still down 15% from its all time highs. So we have had a pretty good shakeout. It has had a nice move higher going into today’s earnings report. But here are how the numbers came in.

Estimates for revenue for the second quarter were 28.8 billion and BDA did 30.2 billion. So solid, beat their gross margins came in at 75%, 75% gross margins. How’d you like to have a company that gross margins of 75%? Estimates for the third quarter for revenue are at 32 point. This is a company’s estimate of 32.5 billion. They’ll handily beat that without almost any doubt. And they also announced today, and this is big, a $50 billion share repurchase program. Putting all that cash they have back into, back into their own stock tells you what they think about their share price. They believe it is undervalued.

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And, of course, I think they’re right. They also announced today, this is the way this story has evolved over the years. For Nvidia is really one for the record books. This used to be a gaming company. Their chips were for games. Now in this realization quarter announced today, 26 of the $30 billion they had in revenue came from their data center revenue, and only 3 billion came from gaming. So 87% of the revenue is now coming from data center. And now, of course, the talk of the street is their new chip called Blackwell.

The current chip is called Hopper, and that’s being phased out slowly. Blackwell there’s been a little bit of a delay in shipping against supply issues, but that expected to ship this quarter, beginning this quarter and third quarter, and then really ramp up in the fourth quarter. So video had a solid quarter, but again, it missed the whisper numbers. Somebody had a whisper number of revenues of 30. I think I heard 38 billion. They did 30 billion. They expected to do 28.8. Somebody, some analysts had a whisper number of 36 or 38 billion.

Just big, big number. And of course, they got nowhere near that. I think, you know, you have those kind of big whisper numbers, and it’s pretty common to see a stock, even though it beats estimates, have a, have a weak after hours trade. But I’m gonna remind everybody, and by the way, this is a, this is a very common occurrence with this company. And by the way, I think it’s a very, I’ve seen this happen in the world of tech over and over and over again. The way the stock trades in the first minutes and really the first couple of hours after earnings reports is almost, is almost always completely reversed the next day. Happens all the time. Not a prediction.

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We don’t own Nvidia outright. We do own ETF that have, it has a, about a 20% position in Nvidia. But I would, I would expect that Nvidia is going to rally tomorrow, and I think I would be surprised to see these losses reversed. The $50 billion here buyback program, it’ll be a little while before they start putting that in place. That’s going to provide, of course, a lot of support. And you get a lot of people, again, we have $6 trillion sitting in money market accounts, another $2 trillion sitting in brokerage firm money market accounts, $8 trillion total in money market accounts between banks and brokerage firms. A lot of people have not been in this market because there’s just been this, again, we talk about a lot, there’s been this fear factor. It’s been a sigh up, a negativity that’s out there, and you’ve got so many investors that are just scared to death of owning stocks aggressively.

So again, that’s going to provide a lot of support for this market as we move forward. And we did write this up this morning, and this is not a big downshift for us, but the VR investing system has fallen from eleven out of twelve screens bullish, which is a record for us. We sat there about six months, now it’s ten out of twelve screens bullish. That’s just a slight downtick, really nothing to be concerned about. It’s just a acknowledgement of what we’re seeing in the market. The reasons are threefold for the downtick. Market leadership has degraded slightly. Again, the semis intact begin leading the way lower in mid July.

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That’s our tell. So we have to account for that in the Bureau investing system. Number two, when again, we think that’s short term. Number two, seasonality. Is this probably our biggest concern? Seasonality is turning a bit negative here. September is not a great month in election year cycle. But I also make this comment, something Tyler has pointed out multiple times, that seasonality trade is a crowded trade. Everyone is talking about how negative September is.

We even had people saying that at the beginning of August, August will probably wind up being a month of gains, but certainly not a negative month. So it’s a crowded trade, meaning that so many people are expecting it that usually when that’s the case, they don’t happen. And the third reason that we downgraded the Vrainvest system just again, just slightly, is that the markets, again, have come a long way in a short period of time, hitting, and they are hitting, going into today’s trade heavily overbought on our VRA investing system. What’s interesting here is they never hit extreme overbought. The markets have yet to hit extreme overbought on this move. That tells me this is backing and filling action. I do not expect, I do not expect us to have a bad September. I just don’t, I think, don’t fight the tape, don’t fight the Fed.

All the bullish catalysts that we have so much cash sitting on sidelines. And I’ll throw something else out there, too. Again, this is, this is Kip putting on a little bit of a conspiracy hat. But I, as I’ve said often over the years, yeah, I am a pretty proud conspiracy theorist because I like being right. I like being right. And, you know, if you’re a conspiracy theorist, just give your point of view about six months and you’ll be proven right. This has happened over and over and over again, really, since 911. Conspiracy theorists have been the only ones that have been consistently right.

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So with that in mind, there are another couple of bullish reasons, I think, to be long. This market here, again, a lot of negativity in the market. A lot of people worried about what’s going to happen in the election. Hey, we are, too. They just tried to assassinate President Trump. So, yeah, those risks are real, no doubt about that. And it does make sense to have some insurance. We did put some insurance on in the portfolio just for a worst case scenario.

That’s all it is. It’s insurance. We are aggressively long. And so I think it’s smart to have some insurance just as a hedge in the portfolio. That’s not a prediction of something bad happening. It’s just, I think it’s a smart money investment. But the two reasons to be bullish headed into the election, both have to do with the election. And they are the state, the uniparty, the deep state, whatever, the intelligence community, which, they’re the ones that run everything.

Now, you know, there is no Democrat party, understand? It’s not democratic party. Every time I hear someone say this, I want to throw up. It’s not the Democratic Party. It’s the Democrat party. And yes, words do matter. We have the republican party. They’re called Republicans. And we have the Democrat Party.

They’re called Democrats. Now, why would they want to be called the Democratic Party? Oh, I can’t imagine why would they want to be, why would they want to be called the Democratic Party when we live in a democracy? Right? So again, they play these word games to psyop people. They are not the democratic party. Let’s start a movement, people. Let’s start a movement here in the VRA. There are others besides me that have this as I have a problem with this, if you will. And I’ve pointed that over the years so many times. Stop calling it the democratic party.

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It is the Democrat party. But again, there is really is no, there is no Democrat party even. They’re not winning these elections legitimately. We know this. It may not be popular anymore to say the election was rigged, but the election was rigged in 2020. The only question I have is how long have they been rigged? How far do we have to go back? Like, for example, when Mitt Romney lost to Obama after, after Obama launched Obamacare. We know the big lie. The big lie that was told, you can keep your plan, you can keep your doctor.

He said it 13 times on video. We have it on video. He said it 13 times heading into the approval of Obamacare. But he was so unpopular, rightfully so. I believe Mitt Romney won that election. And so that’s the first time I really started questioning elections. I didn’t question Obama beating McCain. I mean, I voted for Obama over McCain.

That’s how much I just like John McCain forever. Okay. Again, I’m a lifelong independent and I have voted for Democrats in the past. Just can’t do it now. It’s a party of insanity, right? It’s a party of anti american policy. And that’s why you see so many people, you know, like an RFK junior. And what’s the hawaiian congresswoman? Oh, my goodness. I got a lot on the brain today.

So Gabbard, Tulsi Gabbard, thank you. Thank you, Kip, for catching that. But again, they’re now endorsing Trump. I think there’ll be a whole lot. There already had been a lot. There’ll be even more of these. But they’re not winning elections legitimately right there. And they don’t even rule.

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They don’t have any power. We know this from watching Biden. I don’t believe he made any decisions. I think they’ve all been made for him. And as the state running things, and I’ve heard this, by the way, I’ve heard this more and more recently, that maybe that’s how it should be. Maybe that’s, maybe, maybe we should have a shadow government making the decisions for the country instead of a president that we change every four years potentially. Maybe it should be, you know, almost like an AI based system that helps us make the right decisions. It’s hard to turn this country, we’re so big, it’s harder to turn the country on a dime.

It’s a big old super tanker. And maybe it makes more sense. I don’t buy into this, but, but I think that’s one of the reasons that people vote for Democrats and the Democrat party is they feel that there, that makes more sense for the, for the country to be run by a, I don’t know, a deep state cabal, a shadow government, things like that. But anyway, the point being is this. The state, clearly, the uniparty, the power, the shadow government clearly wants their team to win. That would be team Kamala now. Right? How are they going to do that? Well, how about the Fed aggressively cutting rates? How about the Fed now plowing money, easy money policies that only the Fed can do, basically getting rid of quantitative tightening? I think that’s going to happen as well, flooding the market with liquidity, driving stocks higher again with the Fed reversing role here, policy conditions here. I think that’s going to be a bullish impetus for the markets.

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And the other is just as bullish if Trump wins. Because if Trump wins, I think we all know what’s going to happen in the stock market. We know it’s going to happen in the economy. It’s going to be a massive shot of steroids. The animal spirits will return immediately and so we’ll see that happen as well. I think the election actually has two bullish catalysts, and you can’t always say that, but I think that is the case now. So again, we are not, you know, we didn’t even toy with the idea of taking profits here. We did buy after the, the shakeout, we bought tech, we bought semis, we added to our Tesla position and some others.

But we had the conversation, should we take some off the table? You know what, why would we? And that’s the problem. And trust me, folks, I’ve played this game a long time. I was a day trader for a long time, short term trader, options trader, right? Glued to the markets, tied into it. My returns were never, were never what they are now. Right from the time that I became more of a position builder using the Bre investing system as a trend follower, my returns have gone much better than they were before. And one of the big reasons for that is emotion, then leaves your investment decision making process. You’re not driven by emotion anymore because I can’t tell you the number of times where I’ll let emotion. There would be bad news and then the market takes a big nosedive.

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Then you think, okay, this is going to be the beginning of something big. And no, that was the bottom. But based on emotional trading and emotional investing, I would be out of the market. And then here came the big recovery move that would no doubt always follow. And I think that’s where we are now. We wrote this up this morning. I’m going to cover this quickly because I think it’s that important. And we have a lot of new listeners and new subscribers of your eight all the time.

There’s just too many reasons to be bullish and these aren’t being talked about. Again. From the time we wrote the big bribe, which has now been a couple of years ago, the smartest smart money strategy has been buying the dip because we are in the roaring two thousand twenty s. And that’s what surprised how, I mean, we were, we were like, we’re doing our research for the big bribe starting in late 2021. And we kept coming across information, like, how is this? Is this maybe the strongest economy we’ve ever seen? And I know people will be like, well, how can you say that, Kip? Look who’s presidente. You know, we get a lot of pushback on that. The fact of the matter is the Trump economic miracle, a lot of what’s happening now is from Trump’s time in office because his policies are still in place. And I’m always surprised that Trump doesn’t talk about this more.

I think I’ve talked about it more than Trump has, frankly. You know, again, his tax cuts still in place. Biden didn’t touch those. His china tariffs. Biden’s only added to those. Of course, he liked to bash Trump for his tariffs, saying they don’t work. And then all he’s done is had to. Again, of course, Biden didn’t do any of this.

Right. The shadow government did this. And then third, was that Trump’s deregulation, Biden’s added more regulations, but 90% of Trump’s deregulation policies put in place are still in place. So that’s one of the big reasons the market keeps going higher, is that we have a structurally strong economy, which makes it a structural market, the most powerful kind. And so this is what we started finding a couple of years ago. And everything I’m going to tell you now has only gotten stronger. Keep that in mind. Here are the facts.

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Again, you’re not going to hear this in the media. You’re not going to hear this in the media because of the slap of negativity. But facts are facts. We have all time highs in stocks, all time highs in credit scores, all time highs. Home prices, all time highs in net equity, in home all time highs. Consumer net worth. One third of Americans own their home with no mortgage on it. Again, these are all, all time highs.

And, you know, if you follow us along at all, you know that without question, the most important, most important part of your investing system and the most important economic driver is housing. There is no, there is no close second. It’s housing. And so most of the things I just, I just rattled off there had to do with housing. Of course, we just found out home prices just hit another all time high. That’s only going to continue. So that’s driving everything super bullish. Also, again, these are big structural drivers of this bull market.

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Over the last 15 years, we’ve talked about this a lot because it’s so important. In 2008, Americans really got the shaft, didn’t we? How many people lost their homes? How many people almost lost their homes. How many people lost their businesses because the banks used the financial crisis to take over the economy? But we learned and consumers said, you know what, I’m not going to allow myself to put in that position again. So we cleaned up our act, we cleaned up our personal balance sheets. I know the media doesn’t report this, but folks, these are facts. Over the last 15 years, consumers have cut their debt by 25%. That’s to disposable income. American companies have cut their debt also by 25% to their market cap.

And this, this freight, from a corporate point of view, this is probably the biggest reason to be bullish of all, because it gives us, we have so much ability to lever up corporate debt to market cap is at 50 year lows. Corporations do not have debt on the balance sheet. I’m sorry, but you don’t have bull market tops when these things are in place. These are not bearish signs. These are, these are, these are only reasons to be supremely bullish. I can’t state that more unequivocally. These are reasons to be all in on this market as long as you have a medium to long term horizon. Because the short term, who knows what’s going to happen? But when it comes to the debt picture, it’s important to understand these are really powerful tailwinds for the us economy.

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We haven’t even added debt. Neither the consumer or american companies have not added to their debt totals. Again, to disposable income, okay. When it’s all about not total of debt, but to disposable income, this means the ability to lever up is significant. It’s more significant now than it’s ever been. Again, I believe this is the strongest economy we’ve ever seen, that we’ve ever seen for both companies and for the individual. These are in fact the conditions we see at the beginning of economic expansions, not the end. Now, have you heard any of this in the mainstream media? No, you haven’t.

Very rarely do you have it because you get shouted down. You know, the bears always sound so smart, right? The perma bears sound so smart because they can pick and choose the data they use. You know, the media is already as negative as could be. So, you know, when you come out and you say something that’s contrarian, like I’m telling you here, it sounds like it’s blasphemy. And we hear this all, not as much now. Okay. When we first started reporting this a couple years ago, we wrote the big bribe. We had person after person saying, what are you smoking? What are you talking about? What do you mean? The economy is strong? Are you not watching the news? Do you not see what they’re reporting? I’m like, you know what? They may be reporting it.

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Don’t you know that they lie? If you get your news from the mainstream media, I’m sorry, but you’re a sucker. You are a sucker. All they do is lie to you. And so you have to ask, why would they have a sip of negativity? We’ve covered that in the past. The biggest reason, frankly, and there are reasons the elite want to do that so they can buy assets on the cheap. That’s certainly a part of it. But the biggest reason is, you know, that we do have a communist takeover attempt at this country. I don’t think there’s any question about that.

And one of their most popular strategies, and one of the most powerful strategies is to demoralize the people. How do you demoralize the people? Make them lose faith in everything that they used to be able to trust. Right? You just give up on trusting things. And I’ve been there a long time, but right now, you know, most of the people are demoralized. You know, we know our elections are rigged. We know the media lies to us. You know, that’s. That’s.

That’s a. That’s a common communist takeover option when they’re trying to take over a democracy. And so, again, I think there are reasons for this off of negativity. We just don’t buy into it. We think, instead, what is now clearly developing here is what we’ve called the innovation revolution. Some people call it AI, we call it innovation revolution. We’re just in the early ends of this. Again, the drivers is not just AI.

It’s a financial engineering. It’s corporate earnings expansion, which is dramatic against the housing boom. That’s long term. Millennials are as bigger drivers as anything. Millennials have been. Have given. Been given a terrible reputation over the years, not deserved at all. Again, these are lies have been told.

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Millennials, largest segment of the population, 72 million people in the process of inheriting more than $70 trillion. Right now, it’s already started. And the balance sheets are pristine. They are pristine. And, of course, we know what else millennials love. They’re born entrepreneurs. Uh, they’re born into a technology. They just get it.

And, um, they are. They love housing, and they love cryptocurrencies, love bitcoin, and they love equities. So that, again, these are the big drivers. Uh, in case you’re like, how’s this market keep going up there? There are the reasons, and because of it all, animal spirits are returning. Um, and I think, again, if Trump wins, then it’ll be, Katie, bar the door. It’ll just be. But here we go. It’ll be like 2016 again, where the stock market goes up 40% from the election over the next year.

I expect that’s going to happen. And then GDP soars. That’s going to happen anyway, again, because the innovation revolution. But what a great combination this is going to be. We see this as the best investment opportunity. But for the stock market point of view, since the 1995 to 2000 melt up, this will be longer lived, much broader in scope, and also the beginning of what we see as a broad based economic boom time in America. And, yeah, we are. We are in the big minority that sees it this way.

And frankly, that’s exactly. That’s where we like being. Especially. We have the facts on our side, and we do. So we see this. This is the bull market that takes the Dow Jones past 100,000. We’re 41,000 now, and it takes Nasdaq past 40,000. We’re at 17,500 now.

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We have forever to go. It’ll go past 2030 and dips will be the only buying. Dips will continue to be the smartest of smart money strategies. Take this all to the bank, folks. This is. I’m telling you, this is. We’ve been right for two years. Why would we change our two now? Right? This is.

That’s why. That’s why any dips going forward, especially, I believe, into the election, will be a buying opportunity. Let’s take a look under the hood today. Internals, you know, not a. Not a pretty market today. The terms really weren’t that bad. We had the volume. Volume wasn’t great.

69% down volume, NYSE, Nasdaq, 70% down volume. But advanced decline was much better. 1.7 to one negative NYSE. And right at two to one for Nasdaq. And also today, kind of a surprise, we had more stocks than a new 50 week high hit a new 52 week low, 285 stocks, 50 week high to just 133, hitting a new 52 week low. Sector watch today, not as good here. We had eight sectors finished lower, three finished higher. Nothing really big, though.

Again, technology down 1.3%, consumer discretionary down 1%. Not much in between. The only two sectors high were financials and healthcare, as Tyler’s reminded me, I believe both these sectors hit a new all time high today. Financials I know for sure did it had to be healthcare. Nothing else is up, right, those two sectors then Tyler follows that a lot more closely than I do. And a commodity watch today. Gold has had a solid move again. Like the markets, it never hit extreme or bought.

Neither did the miners, but it did hit heavily overbought levels. This is again backing and filling. Here we are, buyers of precious metals and miners on this dip. Gold today right now down dollar 14 an ounce at 25.38 an ounce. Silver. Silver. Guy hits silver. Always gets it more, doesn’t it? Down $0.87 an ounce today.

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That’s down 2.8% to 29.56. Copper today down 2% at 421 a pound. Has had enough. Nice rally. Crude oil today down $1.14 a barrel at 74.39. And finally, the day bitcoin. Bitcoin’s really been taken to the woodshed of late. All of the love that it got from RFK Junior’s announcement he was joining a team Trump that resulted in like a $4,000 move in bitcoin.

That’s all been given back now, essentially bitcoin now 59,400. If I could explain it, I would. I do have a theory about it that I’ve espoused here on this podcast, that there is short selling happening in bitcoin for a very specific reason. Because these large, the buyers, the buyers that will buy this short sell, they’ll be across. This is my theory. I’ve heard it nowhere else. But it makes more sense than anything else I’ve seen, that there are major buyers entering the bitcoin space that do not want to announce that they are the buyer. Because if a big sovereign wealth fund, right, starts announcing they’re buying, sovereign wealth fund would probably be the biggest buyer, be it Norway sovereign wealth funds, Saudi Arabia’s.

[00:29:27]:
I think those are the top two options. But if they were to come out and announce, and they would have to, in the quarterly filings, if they were to come out and announce that they were buying bitcoin, what do you think would happen in the price of bitcoin? Right. It’s skyrocket. It would defeat their purpose of trying to buy it cheap. So I believe the short selling now is taking in place for the likes of potentially the norwegian sovereign wealth fund or Saudi Arabia and maybe many others. So what they’re going to do is just when they have their position filled based on short sales, it’ll do across, they’ll just do a cross. All of a sudden now the shorts will be closed out. They’ll have the long position now they’ll be forced to announce it, and now they’ll be fine when it goes past 100,000.

I think that’s the most likely explanation. I think that is what’s going on. Because to me, nothing else makes sense. Again, futures trading, they say, is the reason for this, because, I mean, they’ve already mined, what, 94% of all bitcoin that would be mined. So the reasons, supply and demand reasons don’t. Bitcoin have never been better and will continue to only improve. All right, folks, that’s it for today. Hope you had a great day and you a better night.

We’ll see you back here again tomorrow after the close. Bye.