Stansberry Research, Released on 4/7/23

“Regional bank stocks are breaking down to new cycle lows,” asserts Keith McCullough, founder and CEO of Hedgeye Risk Management. “This started with a liquidity crisis at the banks and it’s going to end with a lack of liquidity,” he tells Daniela Cambone. “The market cycle and economic cycle peaked back in 2021, and from that point on it’s been a market crash and a bear market, which we are in phase 3 of,” McCullough argues. “[Hedgeye] shorted gold throughout 2021, and then went full-blown gold bull in November of last year… I’m in no hurry to get off this gold run,” he says. “The supply side of gold and production side has arguably not been this good since 2001. You have a very good supply picture and fundamentally I believe it will become a scarce asset,” McCullough states. “To me, if gold is ever going to work, it should work big-time now,” he continues. “We view bitcoin as a commodity, but for now we are bearish on crypto dating back to Q4 of 2021, it’s important to contextualize why crypto crashed and why you should’nt chase it at the top end of the range here,” he says. “The biggest problem with bitcoin is that it has uninvestable volatility. The level of volatility even at this price is nauseating,” McCullough states. “The way that bulls are behaving right now epitomizes the ‘mother of all bubble’ behavior. I think this ends in tears in the next three to six months… not enough people learned their lesson from the bear market in 2022,” he concludes.

00:00 Janet Yellen’s comments on the banking crisis
2:02 Quad 4 recession
5:11 Outlook on the broader market
6:47 What will the Fed do next?
8:25 How will we know we’re in a recession?
10:26 Market sectors that Keith likes
12:10 Keith’s thoughts on gold
15:39 Keith’s thoughts on bitcoin
18:35 How should investors navigate?
21:08 Debt ceiling situation
24:33 The de-dollarization move

Mr. Keith R. McCullough is the Founder and CEO of Hedgeye Risk Management LLC. He covers the strategy sector at the firm. Prior to founding the firm, Mr. McCullough was a Partner, Portfolio Manager, and Managing Director at the Carlyle-Bluewave Partners hedge fund. Prior to that, he was a Portfolio Manager at Magnetar Capital; a Founder, Managing Partner and Co-Portfolio Manager at Falconhenge Partners, LLC; and Partner, Executive Vice President and Portfolio Manager at Dawson Herman Capital Management. Mr. McCullough got his start as an Institutional Equity Sales Analyst at Credit Suisse First Boston. He is currently co-chair of the NYC Bipartisan Policy Center; he writes regularly for Fortune and Forbes and is the author of the popular book, Diary of a Hedge Fund Manager.

  gold, Keith McCullough