Playbook For The Coming Storm:

Ladies and gentlemen, welcome to the Capital Flows live stream. [clears throat]

stream. [clears throat] Think we are up and running. I'm just

going to make sure the live stream is going for everyone.

All right, awesome. And then if a couple of you guys could throw a comment in the chat section, that would be awesome. So

that Oh, it shouldn't be like that. Let

me see.

Trying to make sure that the comment section is turned on so you guys can interact and ask questions and whatever else it might be. So, give me one

second. Let me find this really fast.

second. Let me find this really fast.

Okay, the chat should be working. You

might need to refresh your page and then if you guys can throw something in there so that I'm aware you guys are here.

Awesome. Okay.

Uh, thanks for bearing with me. I'm just

trying to figure out all the the YouTube technicalities. So, thanks for joining

technicalities. So, thanks for joining the Capital Flows live stream. The stuff

that we're going to cover today is I'm just really excited about. There are

there's so many different things that I've pulled together for this and then um a lot of different new models, new things for all of you guys. So, I

appreciate all of you guys joining and you know the the the mindset and reason behind this. Awesome

guys. Thanks for the thanks for throwing in the chat. The mindset and reason for all of this is that I obviously write a lot of research on the Substack. I lay

out a lot of my macro views, a lot of the trades, a lot of the mindset. And I

think one of the things that people really resonate with, you know, as I interact with everyone and talk to different um, you know, traders or family offices or even just individuals

that are on their learning journey on the Substack and through, you know, Twitter and things like that, you know, a lot of people, especially the ones who have more experience, you know, they have their riskmanagement framework,

they have the different ideas that they implement in their playbooks, but the thing that's always incredibly helpful is understanding the underlying drivers

of the change that could take place because you know if you say okay I think there's going to be some type of you know pullback in markets or meltup in markets or something like that right

that's not incredibly helpful in itself right you always have on the media or the news or you know Twitter or whatever it might be people that are perma bears

or perma bulls right and I think the reason why a lot of the research that I put out people have found so helpful is because it's really just based off of my

own models that I've built and the research that I do and able to run so that I can run trades in markets. And I

think that's why it's been helpful for people. And what I want to do is really

people. And what I want to do is really begin to take all of you guys into that process for understanding the drivers, understanding the models and things like

that. And um I'll save it for the end.

that. And um I'll save it for the end.

I'd encourage people to stay to the end because I'm going to have kind of a special gift for everyone that is going to break down the model side even more.

So if you're you've kind of hit a hit hit some walls in terms of building models, thinking about things, or maybe you have less technical expertise in Python or Trading View or whatever else I might be, stay till the end. I'll have

something for you and we'll kind of cover a lot more things together. But

what we're going to cover today is an expansion and more indepth playbook that really gets into the macro views that

I've been laying out. So if you have read the recent report that I wrote, this playbook, this webinar, this presentation is really building on that.

And I would encourage you guys ask questions in the chat. Please, you know, provide feedback. You know, the best way

provide feedback. You know, the best way that I can help you and tailor the research and make it better and better is if I know the exact question you guys are asking. So, I just encourage you

are asking. So, I just encourage you guys to keep asking questions because that helps me because then I can know, then I can go off and a lot of times subscribers ask me questions and it puts, you know, it helps me go down a

rabbit hole where I learn something new.

But the report that I just wrote covered this main idea that we are likely to see an increase in macro volatility over the next 12 months that I believe will dwarf 2022, COVID, and

potentially 2008. But the source of

potentially 2008. But the source of volatility will be from an orchestrated devaluation of the dollar against major currencies. Now what I will say is at

currencies. Now what I will say is at the forefront I don't really pull this from any other macro view [clears throat] of someone else out there. I think there's a lot of views on

there. I think there's a lot of views on dollar devaluation or like the petro dollar system or like people dividing the S&P 500 by gold and stuff like that.

I don't believe in any of that really.

Um not really how I've approached markets or how I view you know predictability in markets. You know, I always approach things of how can I have a tool and a playbook that helps me

manage risk, that helps me predict price action and actually move the needle in my P&L, which I think actually is important. You have to actually

important. You have to actually understand the causal mechanics of the system. And so, you know, this risk that

system. And so, you know, this risk that I see in markets right now, I want to cover how to think about that risk and then how to maneuver through it if it

materializes. You know, this isn't a

materializes. You know, this isn't a presentation and a playbook that is about being perma bearish or anything like that. My whole goal is I want to

like that. My whole goal is I want to know the risks on the horizon so I can manage them correctly. And you know what I see is that you can see the blind spot when you ask people about this idea of

the dollar and they say, "Oh, dollar weakness." and they insist that it was

weakness." and they insist that it was always bullish for risk assets or that okay maybe the dollar sometimes rallies but the dollar doesn't really you know

when equities are falling the dollar basically always rises and so they always believe that the Fed would intervene if anything serious occurred

and you know what I what I see is that over the last let's say five to 10 years especially since the GFC you have this entire idea of Fed intervention and Fed

it and people say the only consequence is that sometimes it can create inflation or it just creates you know this this creative destru or it limits creative destruction in the system you know you have people out there like Talib that will talk about how it's

creating the system that's in highly more fragile and stuff like that but they never really get to the source of like okay well if the Fed intervenes in some manner where is that reflected

besides the price of gold because sure the price of gold is great and I trade gold I run tons of trades in gold every single And that's, you know, something I hold.

I think it's going to be a great beneficiary over the next couple years.

But, you know, gold is not the currency that goods and services in the economy are denominated in, right? Like that's a key distinction to know when you're beginning to think through these

different signals, right? There's a

reason why, you know, gold is a very small market cap compared to the overall float of assets, goods, services, and GDP in the world, right? It's very

important but it's not the entire picture which is why understanding how these nominal and real risks are changing is absolutely critical. So the

mindset that well the Fed is going to intervene and backs stop the system if anything happens right we've already seen that we saw that in the SVB crisis where they even backs stop duration

right and that mindset is precisely why a deliberate engineer devaluation of the dollar would likely drive risk assets lower than higher now this is not

predicting some you know multi-deade bare market or some type of like setup like with the nick where it you know is in a bare market for a decade or something like that. That's not what

this is about, right? The entire

structure of the global system is set up where you can have significant positioning changes and you just want to be on the right side of those. And so

that's what I want to cover in this section. And so the implication about

section. And so the implication about the thesis that I've laid out is that there is different signals, different correlations, different reaction functions of the Fed and the government

and different risks to manage a portfolio. And you know those are really

portfolio. And you know those are really key because when those things happen in real time, even if you don't know the timing, let's say we don't even have an idea about the timing of those, which I'm going to cover the timing in a

little bit, but let's say we don't even have an idea about the timing. If you

are not aware of the potential and having a mental model in your head for how those risks can materialize, then whenever it does happen, you will for sure be just caught in off caught off

sides. And so I want to cover the

sides. And so I want to cover the different signals that could begin to materialize and different correlations, especially as it relates to portfolios.

If you believe what I've been laid out over the last week in these reports, then the entire question is what do I do with my portfolio? And the capital flows community is built for that, right? To

make those capital allocation decisions for yourself or others. Obviously,

nothing is investment advice, but you know, the people that are in the capital flows community include all of the following. You know, portfolio manager,

following. You know, portfolio manager, CIOS, a lot of proprietary macro traders, um, especially either at prop firms or also at family offices. Um, a

lot of the conversations I've been having, um, over the last year and a half especially have been with family offices, uh, from the Substack and, you know, especially the models that, you

know, I'm building on the back end with the team and beginning to formulate a lot of the ideas around these risks are going to be really key over the next

couple years. And so that is who Capital

couple years. And so that is who Capital Flows is for. And so by the end of this, the goal is you will have a written decision tree and a checklist for what

you'll be able to do before, during, and after the type of stress and risk that we see kind of materializing with this whole thesis that I've laid out. Okay.

So from the macro views I've laid out, we are now shifting from, okay, we have this macro view, we understand the mechanics of the system. Again, you

know, I'm trying to build on the research piece that I wrote last week, which in this section um on the substack, you can go back and read that report. The main idea is that there's an

report. The main idea is that there's an imbalance building where stocks can sell off and the dollar selloff, which actually amplify each other and the draw down that happened earlier this year, is

kind of like a playbook for what that looks like. And we're kind of back in

looks like. And we're kind of back in this section where we're beginning to see a lot more risks begin to build. And

you know when I say risks beginning to build that's all about okay how are we understanding the drivers of equities of FX and rates now how are we connecting

those all together and that's what I'm going to cover in this session and so what I would say is that rather than betting the farm on a single macro view right because it is very possible that

the macro view I have and the one that I'm laying out doesn't materialize I mean I don't expect it to materialize exactly how I think right the the future never plays out exactly how we think it

will, right? The goal is to build a

will, right? The goal is to build a playbook that lets you lets you navigate the entire window of risk with intention. So, how to size sequence

intention. So, how to size sequence allocation changes and how to build redundancy into your system. So, across

assets, liquidity, income streams and things like that. So, how to operate from a risk first and probabilistic mindset instead of a deterministic one.

So in the session, I already laid this out on the report of the live stream and what I'm going to be covering in it, but we're going to cover the allocation decisions, how to think about that through this period of time. How to map

it with path dependency into a simple decision tree instead of, you know, some view that just says I just need to short the market right now and just start buying puts no matter what. How to build a redundancy and risk buffers and then

how to install a riskmanagement framework. Okay. So, the first place

framework. Okay. So, the first place that I want to start are the signals around this view that I've been laid out. And the key thing is that

out. And the key thing is that everything breaks down into four signals. These four signals are what

signals. These four signals are what would represent this specific risk materializing. Now, here's the thing

materializing. Now, here's the thing about these four signals is that they are specifically tailored to the specific risk that I'm covering right now. It is very possible

let's say if we have another COVID event that causes massive deflation and kind of this massive collapse or something like that that if that's a different risk then there would be different signals around that right I want to

cover this specific risk right here where we have crossber liquidity that could pull capital out of markets potentially and what that would look like in terms of the signals that we're

setting out for. So the first one is the correlation of dollar pairs turning positive where you have stocks down and the dollar down against major FX pairs.

So that's number one and I'll go through some some charts on each of these so that you can you know be able to understand what each of these look like.

But correlation of the dollar basically falling against every major pair and stocks down at the same time. So that is a key correlation. The second one is cross-sectional momentum showing

equities falling against currency pairs and gold. So that means and don't worry

and gold. So that means and don't worry for all of these things if if these are a little bit complicated to understand.

I'll make it super simple for you with templates that are set up so that you can have all of them and go through them all on your own as well. I'm just going to work through the flow and the ideas

behind this and I'll set you up with all the templates for all of this as we kind of get into the end of the presentation.

But cross-sectional momentum that just means relative momentum. If you go through any academic literature on cross-sectional momentum, it is one of the most important things that you can

monitor at at momentum turning points in markets because typically speaking, let's say you want to get long or short stocks and you think that there's going to be a bare market. Typically stocks

begin to fall against other products.

Let's say currencies, bonds, or you know, other things in the inflationary complex. they begin to fall against

complex. they begin to fall against those before they begin to turn negative on an outright momentum basis. And so a lot of people if you look at any type of funds that are what are called um you

know multivariant uh trend following funds right they'll go across every single product and look at the outright momentum and then they'll look at the cross-sectional

momentum. That's a very well doumented

momentum. That's a very well doumented kind of like academic idea in quant finance if you go into that. So any

quant model typically, well it kind of depends these days, but a lot of you every quant is aware of that and typically has some type of model around that. And so basically that means Euro

that. And so basically that means Euro USD returns minus S&P 500 returns and you would begin to see EuroUSD fall more than other returns. I'll show you a

chart of that in a moment. And then you would see V rising specifically put skew in equities, call skew in EuroUSD and call skew in gold. And then you would

also see expectations shifting from the whole Trump thesis that I've been laid out and the forward guidance. And you're

saying that sounds a little complicated.

No worries. Let's shift into some charts. Okay. So, let's go over the

charts. Okay. So, let's go over the cross-sectional momentum one. Here is a chart with just the S&P 500. And then

you have in the bottom here each currency pair against the S&P 500. So

basically you have let's say you go long the S&P 500 and short EuroUSD. That's

what the blue is right here. Basically

what you see is that even before we begin to move into a negative momentum regime before in this year where we had the draw down due to tariffs where we had stock selling off and the dollar

selling off against major currency pairs right here we began to see the S&P 500.

If you got long the S&P 500 and short EuroUSD, that trade began to underperform right here, even before we're turning negative, right? And we

began to turn negative on an outright basis even before we move into that draw down. And

so the key thing that you notice during this time is that is if you say, okay, I want to get long euro or long the S&P 500 and short all of these currency pairs.

uh short euro USD, short the yen against the dollar, short the pound against the dollar. And you can kind of see a

dollar. And you can kind of see a breakdown of all of these right here, which is just this bottom panel here is the cross-sectional momentum. It shows

long the S&P and short that currency pair. And so what you see is the S&P

pair. And so what you see is the S&P beginning to underperform EuroUSD as a trade and the yen uh against the dollar

as a trade. At the same time a positive correlation begins to take place. So

this is really what the risk materializing begins to look like if we have crossber liquidity begin to build and foreigners begin to sell. And that

is one of the main ideas where we need to see cross-sectional momentum confirm where we see the S&P 500. If you just think about it like this is the S&P 500

is going to start losing momentum. If

this risk begins to materialize, it'll start losing momentum and not make a higher high like it did earlier this year as we moved into the draw down. And

then at the same time, you'll see EuroUSD rally. So you have two dynamics

EuroUSD rally. So you have two dynamics taking place at the same time. EuroUSD

moving up and the S&P 500 beginning to move down. That is why you have a

move down. That is why you have a positive correlation right here with the dollar pairs, right? And you can kind of see these sections on the right hand

side where you have the dollar against every major currency and then you have that correlated to the S&P 500. This

entire template I will be giving to you guys in uh we'll go through it at the end of this section, but you'll be able to have all these signals for yourself.

And so the key thing is that over the last couple of weeks, we've begun to see that relationship begin to move because

you've seen the dollar begin to fall against major currency pairs just marginally.

And at the same time, the momentum shift in the S&P 500 in a very similar way.

Now, we are still the the key divergence, which is why I'm not shorting equities right now, is that we are not seeing a very strong positive correlation right here. So, you'll

notice that sure the momentum of the relative momentum of these products, if you got long the S&P and short EuroUSD and short these other pairs, the momentum has turned to the

downside. So, that trade is kind of

downside. So, that trade is kind of working, but we are not in a positive correlation regime yet right here. And

so what I would say on a macro basis is you always want to think about what correlation regime that you're in because that sends you a signal, right?

The everyone knows about this kind of idea of the stock bond correlation and how if stocks and bonds have a positive correlation or a negative correlation that sends you a signal about the type

of regime that we're in. If stocks and bonds have a positive correlation, then we are either in, you know, a goldilocks regime where stocks and bonds are ringing at the same time or stocks and

bonds are selling off at the same time in an inflationary regime. Only one of the true can be true or one of the two can be true, right? And so the relative relationships in markets send you a

signal about what regime that we're in.

And if you can understand these correlations that take place in markets, they begin to send you an incremental signal of how the macro risks are

developing.

And so what I do is I'm mapping all of those correlations and beginning to do the research on the underlying attribution of those relationships and the drivers of them and saying why are

these taking place? how are they likely to continue or you know persist to a certain degree. So we say okay what are

certain degree. So we say okay what are the relationships that's what correlation shows and then within those correlations within those relationships we say okay well how is the momentum

relative to those relationships within those relationships basically shifting.

And so these types of relationships and models, we're looking at the correlation, the cross-sectional momentum, those are all things that tell us the greater the the shift in

correlations that begin to take place through a regime, the more strength that regime is likely to have, right? It's

the same thing where you have, you know, just think about correlations as they're they're functioning the same as equity breadth, right? the you know equity

breadth, right? the you know equity breadth if you think about market breadth and S&P 500 breadth you know the number of stocks above or below a moving average that's functionally just correlation right where you're just

saying oh stocks are all moving up at the same time stocks are all moving down at the same time or if there's weaker breadth then there's more dispersion and things are less correlated that's all

that saying so that breadth shows you how much strength there is in a macro impulse and it's the same thing with correlations and so let's bring this

back to the thesis that I laid out. You

know, we are at a period of time where you're having some of these risks build in my view, especially in in equities, right? I'm not outright bearish

right? I'm not outright bearish equities. Even if you look at the trade

equities. Even if you look at the trade tracker that I've been running, I still have some long equity, long gold, long silver exposure, long uh I think it's Meta, and then there's uh some other, you know, trades in there. So I still

have some small equity exposure that I'm still playing because I think you still need to pick your spots but I want to lay out this playbook because these shifts that we are seeing take place.

I'm always trying to map them in these ways. So going back if we kind of you

ways. So going back if we kind of you know uh come back to the the bigger picture we want to look at the correlation of the dollar against major pairs. All right we got that. We want to

pairs. All right we got that. We want to look at the cross-sectional momentum and then moving from there, we want to look at the implied vault. So just think about this period of time where we had

the draw down earlier this year where the dollar sold off and equity sold off as a little bit of a mental model for what could take place again, right? Or

that type of risk that can materialize.

The next thing that you would want to begin to think about is that you see these cross-sectional momentum things shifting, these cross-sectional momentum signals shifting, a correlation

beginning to turn positive against the dollar where the dollar sells off and equities begin to sell off at the same time. But the key thing is that as those

time. But the key thing is that as those are taking place, you want to see implied ball begin to rise. That would

be a key signal. You'll notice that over the last month we had a little bit of a pullback and actually you actually saw some selling pressure from foreigners

and a little bit of shift in crossber liquidity which is why we are having a little bit of risks built just a little bit right this is not something where it's outright or a crazy amount but it's

something to be aware of we don't know how persistent those are because we're still not seeing V blow out and show persistence you know we've seen the VIX move all the way back down and mean

revert almost the entire move. And then,

you know, we're still seeing some elevated level of VA in some currency pairs like the yen and then obviously in gold and silver, but not across the other FX pairs and things like that. So,

we're seeing a little bit of signal, but not confirmation across everything. And

so, the key thing is okay, we need to look at V and I want to look at V and it's confirmation of the trends that we are seeing. The next thing is when we

are seeing. The next thing is when we are looking at vault, I specifically want to look at skew. So the reason why

I look at skew is because if you have the S&P 500 moving to the downside, then I want to know how call skew or put skew are functioning in other products.

For example, you know, right here you have in the bottom you have uh in orange put skew or just you this is just skew which is the 25 delta call minus the 25

delta put. So we're just looking at the

delta put. So we're just looking at the spread of implied vault. And don't worry I'll give you you know we'll go through some resources so that you can track all of that on your own if you don't have a Bloomberg. I'll cover all of that for

Bloomberg. I'll cover all of that for you.

the the 25 delta put versus 25 delta call is looking at the strikes on whatever V that is on whatever product that is the ones that are more out of

the money. So the 25 delta and it's

the money. So the 25 delta and it's saying how much of a premium is the put versus the call paying. So right here in orange when you have this orange line move down that's put skew blowing out in

the S&P 500 where people are betting more on puts. puts are more expensive than calls. Now, you'll notice, and I

than calls. Now, you'll notice, and I know this chart is a little bit busy, but I put all the FX SKs up here. And

you'll notice that during this time in blue right here, you had call skew rising in EuroUSD. So, you have this in blue right here, and you have call skew

rising. And we've actually had call skew

rising. And we've actually had call skew remain elevated in a lot of these currency pairs specifically in EuroUSD and then also in things like Aussie USD

and then also uh the dollar you know dollar versus the yen has been on the opposite side. So

when you look at these relationships, especially on a correlation cross-sectionally, I'm always watching how is outright vault functioning and how is skew functioning because if skew blows out,

for example, to the upside right here, if skew blows out to the downside in the S&P 500, then I know that there is a reasonable level of capitulation happening and I probably don't want to

short the low unless I have some pretty clearformational edge about what's taking place. And then I'm also watching

taking place. And then I'm also watching if I want to watch put skew. If I know that the driver in the selling pressure of the S&P 500 is foreigners and crossber flows and the dollar is selling

off at the same time, then I want to watch call skew in eurousd. Why? Because

when you have the the players in markets selling the S&P 500, those same players are going to be running trades and managing exposure in the currency

market, right? Especially if you have

market, right? Especially if you have crossber flows as the primary catalyst or one of the primary drivers of an unwinding equities. And so that's why,

unwinding equities. And so that's why, you know, a lot of people didn't talk about this during the drawdown of, you know, earlier this year, but watching

skew in Eurusd was really key to begin to draw a little bit of a change. And,

you know, kind of going back a little bit when I was looking to buy the low in the April May period, there were a couple things that I was watching. One

of them was the fact that call skew and euro USD was slowing and not making such large moves to the upside and you also had a shift in the yield curve where you

began to see some bare steepening in 1030s. At the same time, put skew is

1030s. At the same time, put skew is blown out in the S&P. And so all of those things together begin to tell me, okay, on the bond side, on the FX side, on the volatility side, we have all of

these different edges stacking with each other and beginning to indicate some type of exhaustion. And so that is

really key on the V side. And for

managing and monitoring volatility, the best place I would encourage people to go is the SEVAL tool on the CME website.

So if you just go to Google and you type in SEVAL tool, CME, Chicago Merkantile Exchange, it'll bring up this page. Uh I

think you can create a free account.

It's all free. And I would encourage you to use that as a signal if you don't have a Bloomberg. And then also use the quickstrike tool that they have on there

because it's an amazing product. Um, if

I didn't have a Bloomberg today or if you know someone on my team didn't have a Bloomberg, then I would just say, "Hey, you need to have the quick strike tool and the sea tool and trading view up non-stop and you should be glued to

those screens 247, right?" Like that's that's what I would say if you didn't have a Bloomberg. So, you can go through all these ball metrics on all the FX pairs on the website. You can see same

dynamic right here. If you go to EuroUSD volatility, put it to the one-year metric, click on the skew ratio specifically. You know, I would go

specifically. You know, I would go through all the metrics, but click on the skew ratio, and you can see it's the same thing because it's the same data.

So, you can go through and see call skew blowing out in Euro USD, the underlying product in blue, and you can monitor it there. They have a I think there's a

there. They have a I think there's a 15inute delay, but you can monitor on an intraday basis and uh it'll I think be fine if you're not um especially if you're kind of monitoring these things

on a daily basis. All right, the final thing is we have these different changes around this risk of crossber flow selling and the final thing that I would

say is that you want to see expectations shifting in trade from Trump. You want

to see a new forward guidance regime from the Fed and a confirmation from the different curves on a nominal real and inflation swap basis. I'll cover all

those, don't worry. So, this is a chart of the tariff news that we saw earlier this year and then also in blue the 2-year interest rate. And the reason why

I have this as one of the signals that you want to be watching is because the entire setup that we have is one where

if you want to have a shift in crossber flows, you need to see the current administration begin to push back on the structural imbalances that are resulting

from the US's reserve currency status and the fact that China is conducting an economic warfare on the US and like I said as we move into midterms and we

move out of midterms and those get confirmed more then you are going to have Trump in my view be a lot more aggressive because he basically has his

final run of you know glory in a sense where if he wants to make any plays he better make him fast and especially if they find out that you know they're not

going to the midterms is not going to be as close as they think or if you have more of a divergence in the Republican party so that it's going to be tough to get, you know, a certain amount of seats

that could begin to escalate their decision-m process to begin to push back on some of these trade things. You know,

in my view, a lot of the structural imbalances that are taking place. Um,

you know, you can go through, you know, people, you know, like Brad Cesser has a lot of great reports on this. Michael

Pettis has a great book on it if you want to actually you know I would say that a lot of the models that I built um you know were kind of inspired I don't see I gonna say the ideas but some of

the models were inspired by some of the Michael Pettis books and I thought those were very helpful um you would have to actually know a lot of the accounting mechanisms and how to do research in

balance of payments already because Michael Pettis covers some of the accounting mechanisms but not uh the actual connection to financial markets.

Um, and I think everyone kind of like bags on him because he's kind of a little I don't know if he's a bear, but he talks about the imbalances a lot.

Sometimes doesn't connect to markets as much, but I just think his his insights have been incredibly helpful for me because he always has he actually just did a podcast with Jack Farley and he

always has these like nuggets of wisdom that I'll always like figure out and build a model around like almost every single time. um just because he he has

single time. um just because he he has such a good grasp on how balance of payment flows net out and how those mechanisms for the flows of capital

work, right? And it's it's much more of

work, right? And it's it's much more of the flows of capital framework that I use as opposed to kind of this idea of like when is the sentiment getting too hot on the AI trade. Like I don't that's

not how I approach things.

So coming back to this chart on the trade side, you know, my view is that you're going to have to have a shift in the trade dynamics or an escalation in geopolitical risk where Trump has to

push back on China a bit more. If he

doesn't, then all of these, you know, dynamics with inequality and, you know, these corporate interests and everything like that, those are going to amplify even more, right? And it would be possible that we see even more of a

meltup. And so I think that Trump is

meltup. And so I think that Trump is probably going to push back in some element on trade and he's going to try to have the Fed be a little bit more dovish and put push the dollar down. It

is very possible that in the interim equities continue to rally where you could have if the Fed begins to push the dollar down as we have this new Fed

share and you have um you know uh uh the new Governor Myron in there and he's put trying to you know pull down the dot plot a little bit more as well and they're going to have a little bit of

this tension where some of the you know uh Fed governors are hawkish but then you have this other side where you're trying to push push back on these structural imbalances before Trump gets

out of office. And so the entire question is how do those all kind of flow together?

And the the idea is that there is a tail event that is very probable if Trump tries to push back on these trade dynamics at the same time that the Fed

turns more dovish to try to push the dollar down so they can have a more competitive stance on trade. So there is kind of this window of risk which is why I'm covering this so that you can kind

of begin to understand it. So I would be looking for a lower shortand rate and then also a shift where you have some

type of deal being cut and on the uh political side in trade or some type of escalation geopolitically and so I would be watching these types of things at the

same time for that. Okay. Uh the other thing that I would be watching in terms of the these different changes and I'll I'll cover these a little bit more uh

later is the shifts in the yield curve.

You'll notice that right here we have the real yield curve. So twos 10's real in white. You know we're already

in white. You know we're already steepening almost to new highs as you know twos 10 and I think it's you know twos fives in orange and blue. you know,

they're still chopping in a range, but now we're steepening a little bit as the long end pulls back a bit, right? And

so, one of the things that I would be watching is, you know, into these types of events, you're likely to see the curve steepen a little bit and especially short end rates price more cuts, right? I think we're going to

cuts, right? I think we're going to price some more cuts into next year a little bit. But the entire question is

little bit. But the entire question is how did those curves and the impulses in them begin to connect with what I laid out previously? Because if I go back to

out previously? Because if I go back to this chart right here, this period of time where you had the dollar sell off and then also equity sell off and you saw these relationships in in

correlations, cross-sectional momentum during that entire time. You saw the forward curve bull steepen and price a ton of cuts, but then that basically

reversed almost immediately. And so

that's the key is like I would be watching twos, fives specifically.

Here's in earlier this year. Let me just make sure I'm looking at the right date. uh right

here where we had the you know April May period of time twos fives right priced a ton of cuts and then we re mean reverted the entire section whereas twos 10's

remained a little bit more elevated because you know twos fives has more sensitivity to that shortend side right that's why you know watching twos fives

it has more sensitivity to these equity drawdowns or these shifts quick shifts in forward guidance that take place that can be more short-term in nature if

nominal GDP is is elevated which is why 10's 30s would be elevated. So um those are some of the mechanics that you would want to think about on that side. So

moving to this bigger picture interest rate regime and kind of where we're at.

I think that one of the changes that we have seen over the last couple of I would say year now is that 10-year real

interest rates still remain elevated. So

this is why I'm not a big fan of betting on a recession and I haven't been for a while. I think that if equity markets

while. I think that if equity markets have a draw down, then that could pull credit spreads higher and that could push pressure on the labor market, but that would be the catalyst as opposed to there's a lot of underlying weakness

that's going to, you know, be the initiator. Like if you have internal

initiator. Like if you have internal delinquencies like you did in the GFC, those were the catalyst to pull equity markets down a little bit more. That

transmission mechanism can work both ways. But for example, every single move

ways. But for example, every single move down that you have in 2-year real interest rates in orange right here. So

this is just 10 year and two-year real interest rates. Every move down that you

interest rates. Every move down that you have, 10ear real interest rates basically keep shaking it off and showing that it's not really as you know

significant of a risk in nominal GDP. So

when you have 10ear real interest rates being resilient like this, it's showing you that growth is actually all right and not collapsing. And the very similar

dynamic is happening on the nominal side where you have nominal rates, 10-year nominal rates and two-year nominal rates. You know, you've had the Fed pull

rates. You know, you've had the Fed pull down rates and cut rates over the last couple years, but you'll notice that we're basically in the same range for 10-year interest rates, right? That's an

indication about the underlying resilience in the US economy on a structural basis, right? And I'm not saying we can't dip into a recession on a short-term basis or something like that, but I think what people have to

realize is that where is all the debt in the US economy right now? It's primarily

on the public balance sheet, which means that when you have all the debt on the public balance sheet, that means consumers are less sensitive to these higher interest rates. And on the government side, the government's not

going to stop issuing debt because interest rates are higher. They're just

going to keep doing it because they own the currency, right? And so that's the idea. So, we have a lot of these

idea. So, we have a lot of these different ideas for the signals that are likely to take place as we move into this period of time. I'd encourage

everyone, you know, put questions in the chat. I'm going to cover a lot of them

chat. I'm going to cover a lot of them during the session and then also at the end, but these are the main ideas for the signals. So, if I summarize just a

the signals. So, if I summarize just a little bit, we have on the currency side, we need to see a correlation of the dollar against major pairs turning

positive. So meaning the dollar against

positive. So meaning the dollar against you know the dollar against the euro or you could say eurousd rallying as stocks fall. So basically

the stocks down and the dollars down against major FX pairs. You need to see that correlation turning positive. Then

you want to see cross-sectional momentum showing equities falling against major currency pairs. So for example if you

currency pairs. So for example if you take the returns of eurousd subtract them minus the returns of the S&P 500 and you want to v adjust those. If Euro

USUSC returns are higher than the S&P 500, that begins to equal a risk, right?

Especially when this correlation is positive. So, you want to see these four

positive. So, you want to see these four signals. positive correlation

signals. positive correlation cross-sectional momentum shifting implied volatility beginning to rise especially put skew on equities call skew in euro USD call skew in gold and

expectations shifting in the trade relationship for Trump new forward guidance from the Fed and you want to see a confirmation in nominals and real and inflation curve swaps similar to

what we saw earlier this year and those are all laid out in these charts and I will we'll cover these charts even more depth at the very end so that you have all of these charts Um, and this entire slide deck will be

available to everyone. I'm going to send it out to everyone after uh the live stream is over. So, don't worry about that as well. All right. Put skew as I covered. You want to go to the seab tool

covered. You want to go to the seab tool and cover everything on there. you have

uh just a basic relationship with watching the news um and the that information flow come out especially on trade wars and tariffs and then also watching the curves understanding the

relationship with higher you know US interest rates that we're in right now and then how do we connect this to the playbook for allocation decisions. So

here is the basic breakdown and and feel free to ask any questions as I walk you through this and begin to explain how I'm thinking about this. So when

[snorts] we begin to see confirmation via the signals I noted above, the entire play is being short or underweight the dollar versus other

currency pairs. So that means that you

currency pairs. So that means that you want to be able to be short the dollar against the euro, the pound, Aussie dollar, maybe the yuan. Um, and we'll see how that kind of plays out against

some other risk on currencies like the Mexican pesos or the Brazilian real. the

if those signals begin to shift, you want to be underweight equities, especially US equities, especially MAG7 because if those things take place, you

know, foreigners when they are investing in US equities, you have a concentration in the top mag seven stocks. None of

this is even accounting for the fact that the fact that passive flows could sell and disproportionately sell the largest names in the index as well.

And then you know everyone is saying okay well if capital is flowing somewhere it has to go somewhere it can't just disappear. Yes I think capital will go into T bills and cash

and that will shift you know if foreigners are shifting their money they're going to shift it into their currencies right especially on the short end. Some of that might impact the long

end. Some of that might impact the long end but I don't want to be aggressively long bonds. um I'm okay if I'm actively

long bonds. um I'm okay if I'm actively trading that into that, but my view is that because of this bigger regime that we're in of higher nominal GDP and resilient growth that it would be very

similar to earlier this year where bonds bid as equities sell off, but then they just reverse the entire move almost immediately. So my goal would be um

immediately. So my goal would be um actually looking for a short in bonds if bonds bid into a event like that similar to earlier this year. So the the bigger

play is if we begin to see these signals materialize is a higher allocation to T bills and cash. Just because the dollar is falling against the euro doesn't mean

you don't want to be in cash, right? It

doesn't mean that your dollars are getting devalued on an outright basis, right? you know the just think about

right? you know the just think about again I think the fact that we had an entire playbook and thing play out is

earlier this year that was just this perfect kind of dress rehearsal of what could take place I don't think it's going to be exactly the same but I think you know

the the market showed how weak its positioning is when the dollar sells off and equity sell off at the same time and so think about high allocation to tea

bills and cash during that period of time, a moderate allocation to gold and silver with the expectation for buying if it has a short-term liquidation similar to the 2025 tariff draw down.

So, if you remember in earlier this year, you had gold and silver rally into the equity selloff and then they eventually sold off when we were at the lows because people were just selling

whatever they could to be able to meet margin calls. In my view, that's the

margin calls. In my view, that's the situation where you want to really have some exposure going in and then hitting the bid on those. In my view, that's what I'm going to be doing when that

begins to take place. When you see an unwind, because once you begin to see that positioning pressure stop, gold and silver in a very similar way are likely

to lead the way out in my view. And then

this other point I have here is long ZT in expectation of more cuts getting priced, but do not expect a persistent bid or realization of those cuts. That's

kind of similar to the idea that I laid out with bonds. You know, I think of that we have a an equity selloff. I

don't think inflation risk is high enough for us to have stocks and bonds sell off at the same time similar to 2022. So if we have an equity selloff, I

2022. So if we have an equity selloff, I would want to be long ZT into that or begin to run longs in ZT if I begin to see confirmations of those signals. And

then for bonds, I would be neutral longduration bonds in the US and also G10. I don't know. It's possible. I

G10. I don't know. It's possible. I

don't have a strong view on it that G10 bonds or you know for example you know long duration bonds in Germany or France or Italy or um any of these other major or JGBs

I don't have a view yet if they'll be rallying what I would say is for long duration bonds a lot of this depends on how much the Fed is going to play into all these things that are taking place

and I'm going to cover the redundancy plan for them in the in the next couple slides. So income uh final thing income

slides. So income uh final thing income flowing assets um and how to think about things like real estate or you know if you have you know dividend stocks or things like that that are producing

income flowing um assets. Here's what I would say. My belief is that there's an

would say. My belief is that there's an underlying resilience in nominal GDP for the US economy and it's likely to stay that way. You know, I think it's

that way. You know, I think it's possible that over the next couple years, we have some negative real GDP prints and maybe they, you know, c those happen as a result of it, right? And you

have a little bit of a contraction in real growth or maybe a minor recession or something like that. But it's not something I want to bet on really aggressively right now. uh you know my

view is that you have this period of time where you have a lot of underlying investment and yes we're normalizing in the job data and the Fed has to be a

little bit more proactive but just remember that if the Fed is too pro is you know brings cuts even more aggressively down and you have some type of investment with that or if the Fed

starts to do QE again to try to push the dollar down you could see an entire you know uptick in US growth and US inflation, right? So, just remember

inflation, right? So, just remember that. I don't think that's off the table

that. I don't think that's off the table right now. Um, but I don't think that

right now. Um, but I don't think that would be imminent until we begin to see inflation swaps rise a little bit more.

So, my view is that I don't see some type of structural bare market in real estate or cash flowing assets. And I'm

actually going to do an entire playbook and presentation on real estate, especially in the US. Um, I have a lot of models on real estate and I talk with a lot of people in the industry, especially in the whole REIT space and

private real estate and acquisition space, uh, pretty consistently every single week. And, um, I might bring some

single week. And, um, I might bring some people on to kind of cover that because I just think the analysis covering real estate these days is just in insanely

bearish. Uh, so I want to be able to

bearish. Uh, so I want to be able to cover that. So, I'll be doing likely a a

cover that. So, I'll be doing likely a a playbook on that, an entire live stream breakdown as well for paid subscribers.

So, keep an eye out for that. So, with

that being said, let's talk about the path dependency scenario analysis, redundancy planning, risk management for these. And appreciate the questions in

these. And appreciate the questions in the chat, guys. I think these are right on point. Let me cover these as soon as I get through the next couple

slides, and we'll keep keep jamming. All

right. So here's what I think about for path dependency scenario analysis and these other ideas. So this here there are three major things that I'm thinking

about for this type of setup that we have. Number one, we know that we have

have. Number one, we know that we have global imbalances and a cross order, excuse me, border dependence for US valuations and US assets, right? And so

that is reliant on dollar liquidity. I

think that the fact that you have US equities at all-time highs for valuations right now, the primary or one of the primary reasons for that is the setup that we have with trade right now.

That's just one of the main reasons in my view. uh I think you have some other

my view. uh I think you have some other reasons for you know investment and AI and stuff like that but the the entire question is on the liquidity side right because we're talking about the

valuations not the earnings of those companies right and so my view is that that is one of the largest structural imbalances it's the same thing that took place in the run-up to the great

financial crisis except the money went into mortgage back securities instead of um like mag seven equities and things like that um again you can go on report

that I just wrote and where wherever you clicked on this link in the substack that report is linked there and I did an entire video on that report explaining that. So number one is you want to think

that. So number one is you want to think about the structural setup. We know that imbalance exists. The kind of the uh pin

imbalance exists. The kind of the uh pin that pops the balloon for that imbalance is Trump's stance and the Federal

Reserve stance. And so Trump's stance

Reserve stance. And so Trump's stance overall is a weaker dollar bias, right?

That's one of the, you know, ever since Trump took office, the dollar has only gone down, right? And why is that? It's

a combination of the Federal Reserve and real interest rates. And then it's also a combination in my view of all of these trade things. And if you just think

trade things. And if you just think about who Trump is surrounding himself with, it's Scott Bessant and then also um Steven Myron at the Federal Reserve

who has a paper on this exact thing that I'm talking about right now. And so I think that's very interesting in terms of what is actually beginning to build in the system and the people that Trump is surrounding himself with because

they're guys that know this entire thing very intricately. I mean, just think

very intricately. I mean, just think about Scott Bessant is the guy that did the analysis on the entire, you know, George Soros trade for, you

know, breaking the back of uh the pound and everything. And, you know, they're

and everything. And, you know, they're they're the he is the one that did the analysis on it. So, of all people, he understands how trade, dollar devaluation or anything like that works

because he's actively traded in markets for what is it over 20 years now. So,

you know, I believe that Trump recognizes he needs a trade reconfiguration, industrial policy, and he needs to use FX as a a management tool for that. You know, Trump realizes

that there's no way he's going to get Congress to get on board with everything he's doing because it's basically a nightmare to get any bill through Congress these days. So, he's just trying to use the tools that he has in

his tool chest as blunt objects to be able to leverage even if that means the equity market going down. Um, even if it means to leverage those things. And

again, when we were going into 2025, everyone said, "No, Trump never crashes the stock market. That's impossible.

That's not going to happen." Right? And

then we began to see him actively do things that pushed it down. So, the

final thing is the Federal Reserve stance, the Trump aligned dovish bias.

In my view, you're going to have a little bit of a shift because I think whoever is going to get in there is probably going to be pushing on the more dovish side and you just had inflation

swaps fall which gives them a lot more room to cut. And so you are having this setup that allows them to cut interest rates a little bit more as we get CPI data over the next month after the

government shutdown and we have that begin to come out. You know, my view is that the my view is that you're going to have

a shift in that sense. Um, where you have part of the Federal Reserve is going to be hawkish in their stance, but the other half is going to be dovish because they're going to be more Trump aligned and it's going to be kind of

like a push back and forth and whoever is the chair is probably going to have a very doubbish forward guidance stance.

Probably going to see a lot more bull markets, especially in rate markets. So

those are the kind of three things that you want to be thinking about and how they're interacting because in my view if we don't have a draw down in equities

these three factors are going to be the differentiating factors for trading any chop and mean reversion range or continued meltup because if we don't have any type of trade shift and the

Federal Reserve comes out dovish and the dollar begins to move down and crossber flows are not selling right and it's not a large enough divergence to cause that

constraint, then you could definitely have another leg, you know, meltup in US equities, right? But it's understanding

equities, right? But it's understanding each of these and how they're interacting. So, here's a breakdown of

interacting. So, here's a breakdown of the scenario analysis for how I would think about each of those factors. So,

if you have just think about stable system, Trump policy, and the Fed stance, those are the kind of the three variables, right? And in terms of the

variables, right? And in terms of the system, just think about the structural setup. So these three points right here

setup. So these three points right here are connected to the different three setups in the table right here. So in

the top hand side you have a stable system. So crossber flows are you know

system. So crossber flows are you know not collapsing or anything like that you have a moderate Trump doubbish Fed that could put the dollar down and equities up right when those three things are

taking place. So that scenario is a

taking place. So that scenario is a meltup and a risk on extension because the system is still stable. Trump is not being too aggressive and the Fed is being dovish a little bit which is

injecting liquidity in the system. When

you have crossber flows beginning to sell and those signals I noted and then you have Trump pushing the dollar weaker and a dovish Fed that also is pushing the dollar down, right? And you have all

those three things matched that can push the dollar down and equities down similar to what I laid out earlier this year and or similar to what we saw earlier this year. This is the scenario that you want to be careful of because

this is the tail event, right? Even

though it is one of, you know, one of the four scenarios that I have on here, this is the one that you want to, you know, be aware of the most because it can have the largest impact. But

understanding these signals where equities go up and the dollar goes down, that would be because you have a dovish Fed, moderate, Trump, and then the crossber relationships that I noted

above are not beginning to materialize.

And then you have a fragile or stressed system but Trump is moderate and the Fed is defensive, you could actually have so if you have crossber flows selling a little bit but then not a ton and Trump

is not coming out as super aggressive on trade and then the Fed is actually hawkish that could push the dollar up and equities down in that scenario. So

that's the other scenario that could take place. That would be the opposite

take place. That would be the opposite of the view that I'm laying out, right?

And in that scenario, that could if you have a stronger dollar and then you also have these equities down given where the labor market is right now that could cause or push things into a minor

recession. But again, I think I don't

recession. But again, I think I don't think the Fed is going to be super defensive moving into next year. Just

not really something that I think is is likely unless we have inflation swaps really move higher. All right. And then

the final scenario right here, stable system in terms of crossber flows. Trump

pushes the USD weaker and then the Fed is somehow hawkish. That would put the dollar more neutral and equities neutral. What I would say is about all

neutral. What I would say is about all of these scenarios, you want to connect these scenarios to the forward curve and to the changes

that we are seeing in the in the setup for where we're pricing cuts in the the sofa contracts and the Fed funds contracts and I will lay that

out for you. So with that being said, you want to connect these signals that I noted earlier, the correlations, the cross-sectional momentum, the skew, and

the expectations with this scenario analysis tab. Because to be clear, the

analysis tab. Because to be clear, the view that I'm laying out where I believe that sometime in the next 12 months, these risks will materialize where you can have the dollar down and equities down, that view could be 100% wrong. And

I'm probably going to update that viewer or refine it as it gets confirmed or falsified, right? But the entire point

falsified, right? But the entire point is saying, okay, I want to know the signals for where exactly I'm right and where exactly I'm wrong so that I know how to size my positions and manage my

risk accordingly. That's the whole idea,

risk accordingly. That's the whole idea, right? And so using these signals that I

right? And so using these signals that I lay out and again I'll I'll cover these even more um and and get you all kind of these templates for trading view and things like that. And this entire slide deck

like that. And this entire slide deck I'll be sending out later today to paid subscribers so that you guys can get all of this. You want to use this slide deck

of this. You want to use this slide deck specifically for the type of scenario that we're in right now. And then in terms of the volatility regime and where

we're at with V, I'm going to have a couple more templates on some of the ways that I'll quantify the volatility regime. Um, a very easy way in Trading

regime. Um, a very easy way in Trading View without, you know, really over complicating stuff and without getting into all the secret ways that people calculate volatility is just looking at

the normalized ATR, right? And then

looking at high ball and low volume regimes. So in yellow you have highall

regimes. So in yellow you have highall regimes. In blue you have low volatility

regimes. In blue you have low volatility regimes which just means that in these regimes when you have a view on one of these signals on you have a view on one

of these in connection with the signals you want to size your risk according to the volatility regime. So if I have a higher ball regime that I'm in and I'm going to bet against equities I want to

use wider stops and smaller position size because I'm expecting more variance. And so again, this setup right

variance. And so again, this setup right here, I'll also get that to you as well in the section afterward and I'll walk you through that further. Um, and we'll go over that at the end here. So that's

something really key to think about. So

in terms of, you know, these different macro views, I want to answer questions that you guys have because I know those are um, you know, kind of top of mind as we're covering these different different

ideas. me. And so let me go through

ideas. me. And so let me go through these questions and I'll start kind of talking about how how those function and then I'll cover the different um

frameworks that I use especially as it relates to interest rates and the tools I'm using for interest rates and then we'll go over how you can get these models and things like that. So all

right let me go through first questions.

Can you cover the stock bond correlation again if it's positive and negative regime? Yep totally. So just go through,

regime? Yep totally. So just go through, you can do this on trading view and back test all the times you have a positive or a negative stock bond correlation and

put those into regimes. So you have positive or negative stock bond correlation if you know your growth and inflation and liquidity models.

Basically, you can have growth rising, inflation rising, growth falling, inflation falling, or you can have growth rising, inflation falling, and then inflation rising, growth falling,

and sagflation. Those connect to your

and sagflation. Those connect to your stock bond correlations of stocks and bonds going in the same direction or the opposite directions, up or down. Um, so,

uh, basically if you just ask CHACHBT to map growth and inflation regimes, the four grow growth and inflation regimes with the four stock bond correlation regimes, it'll show you that and it'll

kind of break that down for you. All

right. Um,

let's go. Next question. New member

here. Not sure if it's your approach, but I'm interested in your view on the probability of the storm. can see the kind of muddle through scenario is a bit more likely and

i.e. The dollar weakens slowly but US

i.e. The dollar weakens slowly but US corporate earnings driven by AI grow fast enough to offset currency losses for foreigners. The market remains

for foreigners. The market remains volatile but not does not crash 100%.

This is totally a possible scenario which is why understanding these scenarios right here is key. Even if

let's say let's say the a draw down in equities doesn't take place but you have the dollar weaken and it puts some selling pressure but then the buying pressure comes from the AI capex side or

earning side. That's a a very valid

earning side. That's a a very valid possible scenario. In that scenario, the

possible scenario. In that scenario, the most important thing that you could know are these signals because these signals right here would determine when the downside and equities at the bottom end

of the range of the let's say there's a choppy range for two months or something like that. These signals would still

like that. These signals would still determine the bottom end of that range.

And then the earning side of the AI plays would determine the upside, which is why you want to follow factor flows on the website that I noted with Jared

Cuban. and I'm going to be doing a

Cuban. and I'm going to be doing a podcast with him tomorrow and I'll record that and that'll be just sent to paid subscribers laying out a lot of

these different views and it'll go over okay how should I be thinking about AI outperforming these other names in connection with this kind of idea. So

you would want to watch factor flows in direct connection with this idea that you're putting forward which I think is a very like valid idea that you want to be watching in connection with factor

flows. All right. What S&P 500 level

flows. All right. What S&P 500 level would completely change your bearish outlook? So, here's the thing. I don't

outlook? So, here's the thing. I don't

think inherently about S&P 500 levels.

Um, I think a little bit about them because I think they're important to to understand conceptually, but for example, if we move up another 10% in

the S&P 500, then I I better have a higher level for when we're going to move into a bare market or something like that because the shifts that are taking place, you know, I think this is this is what happens a lot of times is

people just as soon as they get on sides, they basically like don't care about where we're going in the S&P 500 as long as we're above their cost basis.

It's the same thing kind of with Bitcoin maxis that you say, "Oh, as long as we're higher, I don't really care about what everyone else is doing." And that's fair. It just doesn't really provide any

fair. It just doesn't really provide any value for future trades. Right? And so I think the reason why I like this question and it's important is because when I think about levels,

it's more about how are the momentum and the momentum changes as they connect with these underlying correlations and drivers. How are those functioning as it

drivers. How are those functioning as it relates to volatility in the S&P 500?

Because what I would want to see specifically is a higher volatility regime in the S&P 500. So for example

uh right here earlier uh this go a month ago now and you know this look back uh or this chart doesn't go back to the draw down earlier this year but if we went to the draw down earlier this year

due to the tariffs you would see V beginning to rise and a higher V regime overlapping with those signals. So when

volatility begins to expand, that's a signal in itself because you're having wider variance in the price and when you have correlations converge in that higher volatility period of time, that

sends an higher signal to noise ratio.

So that's how I would think about that.

I would think about it like that because if the there there's not an outright level where if we just hit the 6,600 level and we close below there, you know, right now if we did that because

we're close there. But if we go to, you know, 7,500 in the S&P, then my levels, you know, where I would begin to shift neutral has moved up a lot higher as well because I don't want to take a draw

down to 6,600. That's how I think about that. All right. Um, let's go to these

that. All right. Um, let's go to these other ones. How do you incorporate call

other ones. How do you incorporate call put skew dynamics into allocation into gold and silver allocation versus traditional currency if I remember

oh my gosh this is not uh it's not showing the whole comment oh a blowoff in in implied volcan right now when call skew like blows out

and then I also watch its correlation with gold and equities and and also bonds When these skew relationships blow out, then you need to

be able to one of two things. One, take

off some uh take off a winner because if you were log into that or two, what was the variance for that call skew? So if

you calculate how much your implied V versus your premium is functioning in the range for that then and you don't want to sell then you need to say okay, how much variance can I take? So V is

pricing a 20% range over the next, you know, 20 or 30 days. Can I take that type of range if I'm already 100% on size or something like that? Right?

That's how I would think about that. But

yeah, I for if you go to the sea tool and look at call skew in gold and silver right now, pretty important signal I would say. Um but you know, Col can keep

would say. Um but you know, Col can keep blowing out especially for gold and silver that that's the interesting thing about gold and silver right now is that when a central bank is buying gold and silver um they don't really care about

coke skew, right? That's kind of more of a positioning function. So you have to look at well how much are central banks buying versus the other players how much of Col is just positioning and things like that. So that's what I would say.

like that. So that's what I would say.

Um all right for those subscribers who are not professional investors will capital flows be keeping us up to date on all

these data points in on a near realtime basis 100%. So, as all of these things

basis 100%. So, as all of these things take place in real time, I'll continue to lay out my views and how those views are shifting. Right now, we are not

are shifting. Right now, we are not seeing those views materialize. In

simple terms, you know, I'm not super bearish equities right now, right? I

might take off some positioning or something like that here or there, but we're just not there yet. And so, you know, my view is I'm still waiting to be able to have some type of really

aggressive view and for V to expand a bit more before I'd want to do that because I think if you have this scenario played out, it could cause a 20%, you know, 15 20% draw down in US

equities or something around that.

That's that's kind of the idea for the type of risk that exists.

But I'm not bearish equities yet. I

think we need to trade through as these things take place in real time. We need

to move through the December FOMC. We

need to see how it trades through the next CPI print and see how inflation swaps move through that period of time.

And we need to see the correlations that I noted. All right, but yeah, great

I noted. All right, but yeah, great question. I'll be laying out all of that

question. I'll be laying out all of that on the Substack in real time. For US

real trader in need of an allocation plan for both after and pre-tax accounts and unable to consistently dedicate more than one to two hours a week trading.

Um, how would you recommend turning your research into a Prometheus like allocation strategy? If that's not

allocation strategy? If that's not really possible, what resources would you recommend? So, if you guys don't

you recommend? So, if you guys don't follow Prometheus Research, um, you know, Aan and I are really good friends.

I like all of his stuff. uh we've had tons of chats um offline. He's been

super helpful um and we've gone back and forth on a lot of things that have been really cool. For an allocation strategy

really cool. For an allocation strategy that's either like Prometheus or something else, one I would use I mean I think if you only want to dedicate one to two hours a week, Prometheus is a

great option for that. Um I think the other side is looking at tactical asset allocation portfolios and thinking about

how those can function. Um there are um a decent amount of either active I think um what's his name

um the return stacking guy he has like a lot of good research around that type of stuff and Corey Hoffstein I think it is

and then on actually building tactical asset allocation portfolios that is something I'm going to have um in the future hopefully next year that'll be launched so that you can kind of like

see everything and you can kind of like build a portfolio or things like that.

But I think it's I think [snorts] for a lot of these real time risks, right?

Like there's a reason why you get paid to actively manage a portfolio versus not. And I know it kind of is is

not. And I know it kind of is is challenging because a lot of people have very important things that they're doing. But what I would say is that if

doing. But what I would say is that if you were trying to think about pre and after tax and all that stuff for consistently managing, again, I'm not a financial adviser. I don't give advice

financial adviser. I don't give advice or anything like that. I think a lot of that is going to come down to thinking about exposure in stocks, bonds, gold, silver, and these different

things as you move through and just moderating that exposure incrementally.

I think that's what's going to be more about if you don't have the time on a pre- or abstract basis. I am uh eventually probably going to share some models on how you use margin to avoid

tax liabilities and things like that, but um because I've been doing that with um some people, but uh I haven't been able to like publish it um for everyone

yet. So hopefully next beginning of next

yet. So hopefully next beginning of next year as well.

All right, let's see.

Okay, let's go back to the different matrix and I'm going to keep covering these questions then we'll keep going through the rest of the different educational stuff I have. So

for the question is from the interaction matrix what probability do you give today to scenario one Fed Trump aligned on a weak dollar versus scenario two Fed

defends credibility at all costs. So

where, let me make sure I get this, where the Fed is defensive, I believe. I think

that's kind of uh what you were saying.

Um where the Fed is more defensive and they kind of are trying to have their credibility.

I think that post Jackson Hole, the Fed is a little less concerned about credibility ever since the NFP print NFP

prints came down over the last 3 months.

So the three-month rate of change in NFP has slowed pretty significantly. And so

my view is that, you know, you're having a bit of a shift there, right? So you

have you have a little bit more room and now you have a little less inflation risk. So the Fed doesn't really have the

risk. So the Fed doesn't really have the credibility side uh credibility side where they need to push back on that a little bit more right now. So I

think the higher probability is the weakening dollar. The thing is though, and I think that's going to be driven by real rates, but the the the

dynamic that's at play is it just depends on when is Trump as a in terms of the strength that he's going to get from whether it's Hasset or whoever else it is that gets to be the Fed chair.

What leverage is that going to give him?

And then how does he need to leverage this rhetoric for trade and the trade deals he cuts prior to midterm so he doesn't mess up anything for the Republican side um to be able to gain

seats in um the House, right? So that's

kind of what you want to those are the the things that I'm weighing. Um so I'd actually be watching um you know Kalashi and Poly Market and things like that for kind of where we're at for the different

houses um as we're moving into midterms. All right, let's see.

Is the carry trade a significant factor to consider? Saw some charts depicting

to consider? Saw some charts depicting the yen carry trade has been uh winding down over the years. If true, yen rally during market panics is just knee-jerk.

So this is a very interesting one. What

let let me go over two points here on the carry trades and yen. So

carry trades are not just about the yen, right? And I I know you're trying to

right? And I I know you're trying to focus on the yen here and I'll I'll cover that because I know you're not saying this, but overall, you know, countries are always conducting carry trades between each other, right? And

there's positive and negative carries for those depending on how you're, you know, trying to function. So the

question is how much is overlapped on a crossber basis and how much of carry trades are rising or falling depending on those factors. Um, I'll cover some of the FX stuff in a little bit, um, as we

go through the educational stuff after I get through these questions. But I think that on the yen side, we are not seeing the yen carry trade unwind yet. I think

that the other day with the BOJ kind of pushing on the yen a little bit and saying, hey, you know, we're trying to we're seeing that the weaker yen is causing some inflation, which is pushing JGB yield higher. you had the [snorts] yen rally a little bit and they're

trying to basically jawbone that a little bit instead of intervene in currency markets, right? That's a little bit of the tension.

But the key especially on the yen side is and I'm going to actually get probably do a whole webinar on this and whole whole live stream to kind of break this down for you. You want to see the nic underperforming the US equities. You

want to say GGB's rallying and the yen rallying and you want to see call skew blowing out on the yen where you have you know call skew betting on up more upside very similar dynamic once those

are taking place together that's usually when the yen carry trade is un uh is unwinding uh JGB yields in Japan have been moving up for like years now and so that's when all of these charts are

going around Twitter about oh JGB yields are about to blow up the US economy um they're just not true. I just I mean they're just not true. Um I'm gonna try to do a whole breakdown on them because

I I realize that it's actually a pretty important thing for people to understand and um I want to help people to kind of get a better idea of that. So I'll

definitely be doing a a breakdown on that a little bit further. All right.

When you're using correlations rather than causation for forward-looking predictions, how do you define what acceptable color skew or other variables that aren't too late to act on? So this

kind of goes back to the fundamental principles of modeling time series and the relationships with them, right? So

for example, um so correlation versus causation, super important. What I would say is um we're going to do we're doing a lot of live streams and webinars now,

but we're going to do a whole kind of like breakdown of that because what I would say is that my goal is through identifying the underlying drivers and having a deductive thesis about the

attribution of them based on the causal mechanics of the system. That helps me understand the causality. And then what I want to do is take the correlations that maybe don't imply causation, but

take the correlations that I believe reflect the causal deductive hypothesis I have and use those in real time to

confirm the execution that I have for the momentum changes to take place. So

for example, you know, at the end of the day, you you know, we're talking about, oh, when these things begin to materialize, here's how you want to act.

When you look at these time series or these signals or correlations or whatever you might want to do, you always want to look at them on multiple time frames on a intraday basis, on an

hourly, weekly, and you know, monthly basis and begin to scale your actions incrementally instead of saying, oh, when when they go all the way here, I

need to begin to like get short, right?

You always want to scale actions on a multi-time frame incrementally across these different relationships. That's

really how you want to trade actively through them as opposed to trying to find this single moment in time where you put on this massive amount of risk

and you are you know betting on it like a single thing on a single time frame right you always want to scale that exposure on those time frames in connection with wall so that's kind of

how I think about that and um not to keep pushing things off but I'll I'll cover that a little bit more at the end uh when I go through the next kind of thing that we're going to be doing. So,

how uh let's see. Do you have a model to forecast or do you just map the current regime? Um yes. So, there's a couple

regime? Um yes. So, there's a couple different things for this.

I think about current regime and if you get a really good view of the current regime, that sets the foundation for your scenario analysis and your quote unquote

forecast. If you're going to use some

forecast. If you're going to use some type of you know prediction or whatever it might be where you say what's going to I'm going to predict ahead one day returns two day returns three day

returns five day returns that works or that's a helpful tool what's going to happen is if you have done any type of you know quantitative finance work or

you talk to any quant every single one of them is going to tell you you can't predict over like let's say a month or two months like you just can't right and why is that it's because that

statistical relationship and predictability begins to break down as you approach higher and higher time frames, right? And that's why most

frames, right? And that's why most quants don't really care about macro flows because it deals with some of the causal mechanics for these empirical

relationships and um you know macro kind of gets a bad rap because it's just used to be bearish a lot. Um and that's kind of not how I you know view the macro world. So yes, I think that's super

world. So yes, I think that's super important and I think you want to map all those and I'll actually cover a chart in that a little bit. Um, all

right. What factors do you consider when choosing entry points? Heard you discuss that with FarmD on a session and would love to hear more. Um,

the factors that I use is you basically want to align each time frame and the VA and price changes of those as it connects to these relationships. So

that's kind of where I would start and just say where's my, you know, daily, weekly variance and things like that.

How can I have a view of some of these correlations, cross-sectional momentum, and things like that? Um, as as you move and show intraday mean reversion through

these larger pictures, the way I would think about it is over a month you have a trend. Let's just say you have a trend

a trend. Let's just say you have a trend in equities. That trend is going to be

in equities. That trend is going to be made up of a lot of smaller parts on a weekly, daily, intraday, and down to the tick, right? And so all you want is a

tick, right? And so all you want is a signal to noise ratio for each of those time frames so that you can kind of act incrementally. That's how I would think

incrementally. That's how I would think about it. All right.

about it. All right.

Do you think it makes more sense to extract the expected Fed funds cut from option implied pricing on three month sober futures rather than um you know

the the entire question I guess it you know I mean there's a difference obviously between Fed funds and sofa right there's going to be a basis between that what I would say I guess it depends on what you're trying

to accomplish really so if you shoot me a message and tell me what you're trying to do um or like why you're trying to pull the data or something like that. Um

I'm be happy to help whatever whatever you're doing. But um it depends on what

you're doing. But um it depends on what you're trying to do exactly. I usually

look at you know sofa or fed funds or you know most of the time sofur um because those are more liquid than fed funds.

All right.

Will you ever help us build uh or give us some indicator or live dashboard using IBKR API? I'm building a personal option dashboard. Would love you uh

option dashboard. Would love you uh would be love your help. Be great. If

you shoot me a message, I'd be happy to help. Uh depends on some of the timing

help. Uh depends on some of the timing because I'm a little stretched on time right now, but I will be going over. Um, I'm not going

to do anything on interactive brokers because I don't want to do things with people connected to the API of a broker.

Um, but I will be doing sharing more stuff on Trading View this week. That's

um what I'll say. All right. Um, how can you watch the exporter flows leverage in the system?

That is going to go back to how much It's actually a good question. How do

you watch the crossber flows in the system or or how much leverage there is?

So, it's difficult to correctly tri correctly and precisely say how much leverage is in the system.

The thing that I would say is that you can you can triangulate it and have a decent idea. So what you want to do is

decent idea. So what you want to do is look at how much of the changes take place that can be attributed to changes in the currency and why that currency is

moving. And if you can know why that

moving. And if you can know why that currency is moving and how much it is driving or has a you know principal component analysis or you know correlation or whatever you want to call

it to the change in the S&P 500 or whatever else it is you can have a reasonable idea about that. That's what

I would say. All right. Could

could Bitcoin rally if global equity expands while the dollar and equities crash for Trump? In my view, no. I could

be wrong, but I would be shorting Bitcoin if that begins to happen. That's

my view. All right.

Can you go into the Mexican Brazilian relationship? Okay. So, here's what I

relationship? Okay. So, here's what I think. I think that buying US or excuse

think. I think that buying US or excuse me, Mexican and Brazilian equities is a great play and I would want to continue If if for some reason on a riskoff

scenario the Mexican peso and the Brazilian realale sold off against the dollar and didn't rally, I would probably be buying those. That's how I

would think about that. If they didn't, I would if they didn't and Mexican and Brazilian equities sold off as the S&P sold off, I would buy those. That's how

I think about it. So, I think there's a play either in the currency or the equities in either one of those scenarios if they go down because I like Brazil and Mexico given the trade relationships in the world that we're

heading into. Um, all right,

heading into. Um, all right, let's go through the final section of this. And here's the other thing that I

this. And here's the other thing that I wanted to cover is the interest rate and FX strategy guide. And so I, you know, mentioned that I wanted to go over the entire playbook of the,

you know, kind of this idea about the dollar, about equities, about how those changes are beginning to take place. But

[snorts] what I want to do now is go over some of the frameworks I use to read the curve, to go over policy pass, how front end worked versus the back end and things like that, and then go through some historical case studies and

things along those lines. The reason for this is that you can get a better idea about how to think about

the changes in FX and also rates as they relate to this scenario from a first principles basis. So to start I am

principles basis. So to start I am always looking at nominal curves, real rate curves, inflation swap curves as they relate to credit spreads and factor

moves in the S&P 500. So, the way that I would do that, nominal curves, uh, you can go and pull up the indicator and I

will link that below in the the report that I send out later today of all of this stuff. But, nominal curves, that

this stuff. But, nominal curves, that curve regime is super important, whether a bull or bear steepening or whatever that might be. Real rate curves as well.

real rates. You can pull up that logic on the Fred website and you can just put in real interest rates. You can pull that data. You can build a curve regime.

that data. You can build a curve regime.

You can have CHP build it for you. It's

super easy. Inflation swaps, uh, you know, someone's asking, hey, can you recommend a way for retail to use inflation swaps or track them? Just go

to, uh, Trading View or the Fred database and put in US break evens or US 10-year break evens. that will give you a view of the inflation expectation

component that's not inflation swaps, but it's going to be break even. It's

going to be pretty close. And then I'd also you can also go to the RINF um RINF ETF that um basically is like a traded product that goes off of those.

It's okay. It's not amazing, but it's it's a helpful kind of real-time thing.

What I always try to look at is how are these curves directly connected to credit spreads and factor moves in the S&P or the Russell or whatever that might be because those are always telling me about the things that take

place as it relates to the yield curves policy path and how the front end versus the back end move. What I want to do is I when I break down all of macro, I

always start with what is short-end rates and what's the terminal rate and then I map spreads and crossboard analysis. I'll show you what I mean by

analysis. I'll show you what I mean by that. Here's a chart and I'll go over

that. Here's a chart and I'll go over um this at a future date. Let me see if this works. Um okay, I think you guys

this works. Um okay, I think you guys can still hear me. But the just so you guys can see this side, what you'll notice is this is the rolling terminal

rate and the spread against Fed funds in blue right here. And all you know we do is if you think about what the terminal

rate is there is it's going to be where is the deepest part or the highest part of the sofur contracts right and so the

terminal rate is always moving so for example if we go to where is the deepest part and where is the term ter terminal rate right now right now we're pricing you know 14 bips for the the December

meeting where is the deepest part of the cuts being priced right now. Right now

it is in the H7 contract. So we're

pricing 89 bips, 89 12 bips for the H7 contract. This is the deepest part of

contract. This is the deepest part of the forward curve that's being priced.

Notice that after that, before that we're pricing a little bit less and after that we're pricing a little bit um a little bit less, right? Or a little

bit more, a little bit less. So you'll

notice that after this H7 contract, the market is pricing cuts. So basically

market's pricing cuts all the way to H7 and then hikes all the way after that, right? And the entire thing is you want

right? And the entire thing is you want to know the shape of this because the shape tells you how aggressive it is.

Now, here's the thing. Is the deepest part of the curve in the H7 contract, in the reds, in the greens, in the whites?

Like where is the deepest part? And so

this is why I'll always look where is the terminal rate, what contract is it in. And you'll notice that here right

in. And you'll notice that here right now, you know, previously the terminal rate contract was in the, you know, 14th sofur contract. Now it's in the eighth

sofur contract. Now it's in the eighth sofur contract and it's moved. And so

I'll always map how do those different terminal rates shift across these different contracts and how do you think about that? The other thing is obviously

about that? The other thing is obviously looking at all of them and understanding the relationship between reds, greens, blues, yellows and how those are functioning across the curve and then

I'll look at crossber spreads. So for

example for this eurousd thing or you know crossber flows and things like that I want to look at okay where is the terminal rate for sofur right it's between I have a spread here between

this z5 and h7 contract. So, if I think there's going to be a cut and that's kind of baked in for the the short end, the cuts for the US have been moving

down and expanding in the Z5H7 spread for this period of time right here. And

so if that begins to move down again without these other spreads moving which is you know here's your IBORE um and then the other you know like Corora and all these other kind of like contracts

for the short-term interest rates in the Euro zone uh the UK and things like that. So if you know especially you know

that. So if you know especially you know watching eur like cuts in in the forward curve for the euro zone is really key because you can see that we've moved down a little bit where we're still pretty elevated in terms of amount of

cuts the ECB is expecting to cut and the market's expecting but then the US has you know priced a lot more cuts and now the dollar is functioning as the marginal change between these spreads.

So that's one of the drivers for them if you're thinking about FX flows. So

always looking at the spreads and then also what I'll do is I'll back test and this kind of goes to saying okay how do these different relationships function for bare flattening bull steepening bull

flattening steepener twists and things like that what is the S&P returns and one of the things that I would say is here's the twos fives when we are bull

steepening uh or bare steepening and you can kind of see how the over the last year we have functioned when we are bare steepening in the curve in twos five

specifically. And so what I'll do is

specifically. And so what I'll do is I'll map how we're changing in the curve against asset prices and their expected returns. One of the things that you'll

returns. One of the things that you'll notice is that over the last let me see if I can pull up this chart here. Yeah.

Um if you you can pull up this script.

I'll again link it below. It's in the main educational primer section. One of

the things that you want to see is when we bull steepen in these like blue regimes right here.

If you bull steepen and then the market just shakes that off and you know the market sells off as we bull and then we pull back. That's the market showing

pull back. That's the market showing that it's way more resilient than any kind of short-term positioning shocks from the, you know, rate expectation side that are pulling liquidity out of

the market. Right? That's one of the

the market. Right? That's one of the things that I look at. But on the rate side for these FX mapping of flows, if you trade FX a lot, you always want to look at inflation swap differentials,

real rate differentials, nominal rate differentials, and curve regime differentials. If you are just using

differentials. If you are just using Trading View, watching nominal rate differentials, and curve differentials is key. So here's just a chart of Euro

is key. So here's just a chart of Euro USD. You have the different kind of

USD. You have the different kind of changes in inflation swaps right here.

You can see inflation swaps in the US have fallen significantly more than the Euro zone right here. And then you can kind of see here in the real rate side

you have them you know pretty you know in lock step and then also in nominals right there or excuse me this is real this is nominals. So I'm always watching those. I have some models that map those

those. I have some models that map those relationships and how much they're impacting Euro USD or other currency pairs. And then for the curve regimes

pairs. And then for the curve regimes here's all the curve regimes for the US and then here's all the curve regimes for Germany. and I'll watch those

for Germany. and I'll watch those especially on an intraday and and weekly basis to see how much of those regime changes are accounting for changes in

the FX. Um all right,

the FX. Um all right, final thing is I want to go over you know here's where we're at with the dollar and then we have curve

differentials. The very interesting

differentials. The very interesting thing is how are interest rates changing as we move into this period of time with the dollar. And you know my view is that

the dollar. And you know my view is that if the Fed begins to bring rates down relative to these other countries and you don't have inflation immediately

result that can begin to cause the weaker dollar. And so you'll notice here you

dollar. And so you'll notice here you have one year and then two and then you know longer end you know rate differentials in these different countries and you've had a little bit more of a spread because the dollars

come down a lot more um because of actually some real rate differentials.

And so the entire question is when we make a you know if if we move down in the dollar again right the dollar against the euro if that begins to take place is that driven by the long end or the short end

and how sustainable is that right that's kind of one of the things that I look at all right if a lot of that was a bit complicated I'm sure there was some stuff that might have went over your

head or something like that totally fine let's bring it back down to just this simple idea of the regime that we're in right now where we have these signals for the

playbook that I covered and we have these different changes for the scenario analysis and we want to think about those changes as they take place and as

we move through time and so I think that's the main point you really want to take away all of these other interest rate guides and the strategy and stuff like that I'm going to have more primers around that more models around that in

the future to interpret that and understand what's taking place so that you can understand why and how to map those different things. But here's what I would say. Everything we did today was

for one thing to make sure that if we have this volatility and this storm hit, you don't have to guess about the relationships. You can leave with a

relationships. You can leave with a well-written playbook and a process for the changes that we have in the cycle.

And here's what I would say. I always

think about this for myself because I fast forward 12 or 18 months and you know there's two versions of myself that I think about right and that I would

encourage you to think about in how you're approaching macro. Person A did what we did today, wrote a decision tree, set some limits, thought about, okay, let me check this on a weekly

basis. Let me stay plugged in. Let me

basis. Let me stay plugged in. Let me

just follow the real time research on the substack and how the signals are changing in real time. And person B, they're going to read the same

headlines, but they are looking at, well, I'll just see how it feels when things actually move, right? And they're

not doing any preparation. When

volatility hits, person A can take predefined actions, maybe look dumb for a week or something like that, but if they're managing the risk, they have cash and they survive, right? Person B,

right, that version of myself hesitates or sells late or buys late or whatever might be and prematurely transfers whatever that amount of compounding might be to someone else who is

prepared. And so the thing that I always

prepared. And so the thing that I always think about is, you know, there's two versions of myself in the future. And I

guess technically there could be more but for a you know specific thing and which one am I going to be depending on the preparation that I do now. And so

how am I going to use the things that I have today to prepare my future self in a better way for that. And so one of the things that I would say is, you know,

you can take 60 seconds and I would even do this right now and write down, you know, two or three things that you feel like would be the things that you would

need most help with as you are thinking about approaching that period of time.

You can put one in the chat. You can

also message me or kind of talk through some of the things that you're thinking about and you can shoot me a DM. But if

you throw them in the chat, those are super helpful not only to just think about and verbalize. And every single person, no matter whether you're a quant or you're discretionary trader, a portfolio manager, or a financial

adviser, you're all thinking and all of us are thinking about, okay, how am I going to manage these risks? Because,

you know, no one in the fog of war ever acts as well as they think they will.

That's just the baseline. And all of us want to think that when the pressure comes, we're going to act better than we, you know, do in normal training or preparation. And so I always think about

preparation. And so I always think about how can I remain incredibly prepared through all of that and how can I begin to continue to have that preparation so

the future self, my future self is happy about the work that my past self was prepared for. And so the thing that I

prepared for. And so the thing that I would say is that, you know, you can't control the storm. You can't control what's going to happen in the market, right? But you can control whether

right? But you can control whether you're the one that forced to liquidate to someone with a plan. And like I always say, you can't know the future with certainty, but you can always know

what exactly to do in the present. And

so moving forward, there are several things that you want to know. One, you

know, what we did today is just the snapshot. All the models that I'm

snapshot. All the models that I'm running are going to continue to update you in real time. And going forward, there's going to be a consistent cadence of webinars. And I'm going to be

of webinars. And I'm going to be translating that into the interest rate research, FX research, and everything like that. And if you want to be able to

like that. And if you want to be able to continue to operate from kind of this expectation of, okay, let's map the drivers, let's have this process, and

let's just kind of keep this simple learning process going. Stay plugged

into the community, follow all the updates, keep refining the playbook that you have, and I'm going to keep doing the models on my side and all the research so you can have all the

information that you need.

On Thursday of this week, and this is kind of the special thing that I have for everyone that actually stayed till the end, so I appreciate it. On Thursday

of this week, I am going to be doing another webinar and another live stream where I'm actually going to go through

every single Trading View model that you would want. I went over two of them

would want. I went over two of them today. So, the models I have for the

today. So, the models I have for the correlations and cross-sectional momentum and a couple others. I'm going

to be going over all of those for you and and it's just going to be event for paid subscribers. And then I'm going to

paid subscribers. And then I'm going to have uh the quant that I have who's on my team who does all the coding for me in Trading View and then also in Python.

He's going to come on the live stream as well and we're going to walk through how to think about these different indicators that you can build on Trading View. And then at the end of that,

View. And then at the end of that, there's going to be an entire breakdown of all of those indicators. And if

you're a paid subscriber, you will get all of those for free or included in the the to be able to be a paid subscriber.

So those are going to be 100% yours. And

as well on top of that, if you're on the webinar on Thursday and you come on with some notes, we will code up in real time any ideas that you have. So, if you want

to join the live stream and say, "Hey, I have this idea about the dollar and you know, I don't have the ability to code this thing or this thing or this thing

over here in Trading View." And

basically, whoever has a specific idea or whatever that might be, if you shoot me a message and you want to come on the webinar and you actually have a real idea that you want to work with us on to

code in real time, we'll code that up in front of everyone so everyone can see the process in real time. And then that indicator on Trading View, we'll give to everyone so that everyone can have it

and be able to benefit from the different ideas that people have. So on

Thursday, I'll send out an email about this. there will be a live stream and in

this. there will be a live stream and in that live stream I'll walk you through all the trading view indicators, all the ones that I laid out today and then even more and all of those trading view indicators will be yours and I'll get

you access to them so that you can have all of the signals set up for all of the research that I'm laying out. And then

on top of that, I'll do a couple other live streams and breakdowns explaining these changes, especially in Japan and these other countries with real estate and everything else. And so I'm going to

continue to do all that. As a reminder for anyone who's new, all of the educational primers and there's already a couple Trading View indicators right here um that are free for everyone. This

is the yield curve regime indicator and then the Bitcoin indicator and then all the books, right? I would go through all of these playbooks because these are all the educational primers and all of these are on the website. All right. So, if

you go to the website and click on this main page right here, this main article that says educational primers on every aspect of macro markets, scroll down and go to all of these. You'll have all of

the educational primers here. They're

all they're all for everyone. So,

um those are the main ideas. Again,

Thursday there'll be a entire breakdown.

You'll be able to walk away with every major Trading View indicator that you would want to kind of map all these macro flows. And it'll be set up

macro flows. And it'll be set up perfectly for you on a dashboard. And

then if you have ideas or you want to come on the live stream, all you have to do is message me on Substack um and we'll have you on and we'll code up whatever you want in real time and we'll break it down and I'll provide some

thoughts and we'll go over things so that you can have exactly what you need and then the you know quant that I have who is coding up all that and has all

the experience not only in you know trading view but then also on Python and machine learning and a lot of other stuff you can ask him any questions that you want and we can go over any of the

stuff from that side so that he's a resource to you. So those are the main things. I know there's a couple extra

things. I know there's a couple extra questions so let me go over those questions and we will wrap up.

[snorts] Can you take us a walk through everything using just the tools and models available on trading view? you go

information. It' be nice to to see a continuous flow. Yep. I'll go through

continuous flow. Yep. I'll go through that exact thing on Thursday for everyone.

And then yes, good question. Can you clarify what you mean when Trump when Trump pushes back against these trade imbalances? The

main thing would be going back to this regime right here. Trump previously

pushed back against the trade imbalances with the uh tariffs, right?

any push back on trade imbalances. What

that means is that Trump would implement some type of regulation or geopolitical leverage that would cause a change in

the balance of payments of imports and exports which would have a commensurate impact on the capital account for the United States. So if you go through the

United States. So if you go through the balance of payments and you look at what are the balance of payments, how do imports and exports function and the current account relative to the capital account and again you can ask chat if

you see all of this. If Trump puts in any regulation again tariff is a type of regulation any other regulation or has some type of deal between different

different countries specifically China or the countries China is trying to export through right now by proxy.

If he makes any changes on that side, those can begin to suck out dollar liquidity from the balance of payments and that source of dollar liquidity that provides liquidity to the US system.

That is what I mean by Trump putting uh push back on trade imbalances.

All right, let's see. Any other questions?

let's see. Any other questions?

All right, I think I missed this one.

Seems at the moment the correlation is high and the event is obviously not early. May maybe if I'm understanding

early. May maybe if I'm understanding the question correctly, what I'm doing right now is laying out the framework because we're not seeing these correlations converge yet. But it's my view that some of the imbalances as we

move through these catalysts might become unsustainable. And so that's why

become unsustainable. And so that's why I'm laying it out now. Is this taking place right now? No, not yet. But we are seeing some marginal changes that have

increased the probability a little bit in my view. All right. The

Okay, sorry I missed this one. Do you

think if the Fed cuts in December, the BOJ won't hike? Um, I think right now the BOJ is going to I don't think I don't think it matters a ton for the Fed right now or I

don't think the Fed decision matters a ton for the BOJ at the moment. Um, I

think it's going to be about how much are long end yields moving up and how much is their currency moving and how is the BOJ going to really try to strengthen their currency because I think we're getting to a point where

they're going to try to push the yen up.

Um, how much that impacts equities, it's still unclear, but I'm watching that very closely in the Asia session. All

right, those are all of the questions. I

appreciate you guys joining. I

appreciate you guys going over everything. I know that was a lot to

everything. I know that was a lot to take in. I'll continue to break down

take in. I'll continue to break down all these things. This webinar is available. It'll be recorded. You can

available. It'll be recorded. You can

watch it at any time and you can go through everything. And then I'll be

through everything. And then I'll be sending out an email later today with all of these different slide decks with everything and you can go through all of them. Go through all the models, go

them. Go through all the models, go through all of the different resources and begin to think about things a lot more. And appreciate all the questions.

more. And appreciate all the questions.

If you have any uh additional questions, just shoot them to me in DMs and uh I'll or in the chat and I'll respond to them there. So with that, I will catch you

there. So with that, I will catch you guys later and thanks for joining the live stream.