2008 on Steroids: Global Financial Reset, Millions of Retirements at Risk

Hi everyone, if you're starting to question the system and want to protect what you have earned, you will want to download our free gold and silver protection guide. It's a clear, easy to follow resource that explains why gold and silver have stood the test of time and how they can help you build real financial security even as the dollar weakens. You'll learn about which metals to consider and the plan that best suits your needs, not Wall Street's. So click the link or scan the QR code to get started today. You're not going to regret it. Chris Vermeulen, the founder and chief market strategist over at the Technical Traders has issued a stark warning about the current state of the global financial system. He has laid out a very compelling case for an impending market downturn and gold will act as a critical indicator. We're going to find out more from him today. He's also brought along some great charts to look at. But Chris, so good to be back with you. Thank you for joining us. Always a pleasure, Danielle. Yeah, sure. Be good. Yeah. Well, look, before we, you know, narrow in on the thoughts here, just big picture here, because I've seen your past interviews where you've really laid out a stark outlook, really, for the economy. I mean, what direction do you do you see us heading in here? Yeah, I mean, I do. I do see things looking pretty bleak. I feel like from a technical standpoint, I'm a technical analyst. So that's my number one gauge of understanding the economy and equity prices and commodity pricing. But even when you look at businesses and some economic data, to me, everything is slowing. Everything is turning around. And to me, it looks like a stage four, which is a financial reset, kind of like the tech bubble, the 2008 financial crisis. I think we're going to see a big unwinding and there's going to be a reset among pretty much all asset classes. And we don't see these obviously very often. A lot of new investors have never even been through something like a 2008, a big crash. So it's going to be pretty eye opening. And that's what I'm trying to do is help protect as many investors as possible, because I think what's coming up is going to destroy millions, tens of millions of retirees, retirements if they are not careful with what's going on. Wow. OK, well, that is a very bleak warning. Obviously, I have a lot of questions here, because first and foremost, I think it's interesting that before, if you spoke about financial reset like five years ago, people thought you were a conspiracy theorist. And all of a sudden, it just seems that talk of a reset is not no longer fanciful. It's actually becoming, you know, a reality here. What does that look like for you? How do you know or what are you seeing that makes you so convinced like, yeah, there's no way out but a reset? Yeah, I think from a technical standpoint, when we look at, you know, the financial markets are all linked in in some way. So if one asset class is generally coming down, that money is coming out of an asset. It's moving into a different asset class. So, for example, in the last week or so, we've seen kind of money rolling out of gold, and it's been going into the equities market. So usually, money is sloshing around between the various assets. Gold is a massive, to me, is one of the key barometers, global barometers, that we're going to have a financial reset, not just in the United States or in Canada, but it's going to be global. And we're starting to see this. And obviously, the tariffs have definitely kind of created the first shock that sent a shot across the bow to go, whoa, these markets can drop very quickly when something goes. But gold is telling us there's global fear. People are worried about another financial crisis. And gold is that way to protect your capital in terms of even if you were to sell your assets and put them in a bank, that bank could be gone with all of your money. You could do the right thing and move to cash and protect yourself, but still lose all your money. So that's why we're seeing, I think, a big movement into gold is because you're getting out of the financial system. You're holding physical assets. And more or less, it's kind of like an insurance plan. If things are going to go bad, you still have physical gold that you have. It's not a fiat currency. It's the real deal. And so I think gold is going to be definitely a defensive play. And it has been right now. We're definitely seeing money move into that. Are you talking something worse than an 08 crisis? I think it's going to be very similar percentage wise. I think the S&P 500 could fall roughly 47% to 55%. We saw that. We've seen this happen in 2000, the tech bubble with the S&P 500. We've seen it in 2008. We've seen it in previous crashes even before that many, many decades ago. So it's not out of the norm. Like, heck, during COVID, the stock indice fell 34% like that. It doesn't take much. If you look at 2008 in pretty much a three-week window or four-week window, the S&P 500 fell like 35%, just like what we saw in COVID. So things can happen very quickly. I think it's going to be another financial reset for a different reason. This time, they're always different than the other. But I do believe it's going to be similar 2008, where it's going to start to roll over. And there's going to be a very precipitous, sharp collapse in pricing. And it's probably not going to drag out too long. But if you're late on the trigger to protect your capital, move to an asset that's safe, you're going to get in trouble, right? Yeah. I just feel horribly, if that pans out, for people who are retired or just enjoying life in the S&P and could risk losing everything. What you're saying echoes, I saw this headline, JP Morgan, Jamie Dimon saying markets are too complacent on tariffs, and he expects the S&P 500 earnings growth to collapse. That's basically what you're saying. Yeah. Everything is lining up for that. The housing market is looking terrible. The bottom is about to follow the housing market too. And the housing market, to me, is actually going to trigger, I think, a lot more panic and make people panic in their equities more. Because what happens is most people have a large equities portfolio, but generally most people's wealth is in their real estate. And so when they see both portfolios, their real estate, their home prices falling plus their portfolios, they really start to panic. And it's easier to sell your stocks than it is your house. So people naturally, they panic out of their stocks and they sell off. And the problem is most retirees or people near retirement, they all buy into the old financial story, which is the buy and hold is good, which it's not. It's a ticking time bomb. When the market's correct, your portfolio gets wiped out 30, 40, 50%. Dividend reinvesting. People think dividend stocks, I did a big analysis on this the other day. Dividend stocks are what all the retirees move into because they're going to squeeze out an extra 2%, 3%, 4% yield, but they don't realize they're more volatile than the stock market. Dividend stocks are down something like 8% or 9% this year. The S&P 500 is down only about 2% from the highs. And during COVID crash, the dividend space, if you're an investor who held all the dividend, big blue chip, strong companies that they're told to buy, they fell 47%. And the S&P 500 only fell 34. So they don't realize that they're holding more volatile stocks. They actually have a lot more downside than the stock indices themselves. And they're doing it all because they're told that they're defensive, strong companies, but they fall. And the problem is the majority of people in the financial markets are 50-plus, and they all are close to retirement, and they all panic at the same time because they're in the same boat. They don't want to give up their lifestyle. They don't want to lose their net wealth and all of that. Yeah. I mean, you know, along the, just that Jamie Dimon article, he's also talking about the odds of stagflation. And we're roughly double what the market thinks where we are with it. And stagflation is basically recession with inflation. So he sees that's what we're headed for. And I guess my question to you is, I mean, what do you advise those clients of yours, Chris? Yeah, I mean, it's a tough scenario. I think what Jamie Dimon is saying, if that happens, I think you definitely do not want to be holding bonds. I mean, bonds have been a sinking ship since the spike in COVID. If inflation is here to stay or to rise, rates probably aren't going to fall. So bonds are pretty much a dead investment. You know, as a long-term investor, more or less cash is a safe play. Gold is still in a strong uptrend. So you don't, you know, you could own gold. I own a lot of physical gold. We recently just got out of a gold trade, a small trade. It was just a quick kind of in and out, but cash is one of the safest things right now. The stock market is trying to figure out if it is going to start a new rally, a new leg higher and have some blow off phase, one last kind of hurrah before it peaks out or it's about to roll over in a big way. And I was, we're right on the cusp and you're better to protect your capital right now and get in when there's a new strong trend in place, a new bull market starting, or to at least avoid the market crash if it happens. So as a long-term investor, cash is the position that we're in waiting for a clear direction. We can profit from falling markets. That's not a problem, but we need it. We need the market to pick a direction. This is a dead cat bounce or a bear market rally at this point in my mind. Yeah. Just before we get to gold charts, I had a question about housing when the market collapsing. I mean, what about markets that are just strongholds like Toronto, New York city? What do you, what do you see happening there? They're actually not that strong anymore. The condo prices are dropping like crazy. People can't sell them. Um, there's all kinds of buildings and subdivisions around where I am, which is around the Toronto area that aren't even finishing. They can't sell anything. Um, there was a recent article talking about this couple, they spent 2.5 million on a condo. They were just about to take possession. It just finished getting built. They went to the bank to get a mortgage and the bank only appraised it at 1.7. And so then they had to bridge the other, you know, six, seven, 700,000, which is a high rate. And they're like, wow, we just bought a house and we're already down huge. The bank sees no value in it. Uh, so there's, I don't think there are the strongholds if they're holding up, they're going to collapse. They're going to, they're going to have a sharp drop. And, um, there's going to be a feeding frenzy for real estate. I love real estate. I think a year or three from now is going to be Epic. I like multifamily buildings, but, uh, you have to hold off and not get too excited. The people are saying real estate's a good deal right now, but it's not yet. Okay. So for first time home buyers, right. You'd say just wait it out a year, two years, a year. Yeah. Yeah. Wait until there's so many homes to pick from. And you, you've got all kinds that you'd like. Um, and prices will probably be down. Like, I think we're gonna see real estate fall another 15 to 25%, uh, from where we are that that's in general, not some, some cities might hold up a bit better, but I think there's a lot of potential of just wait it out, figure out what you're looking for and keep looking. I mean, you gotta be an active investor looking for property. Um, but you've got lots of time. Um, let's pull up those gold charts. If you don't mind, uh, Chris, like you said, you're a charts guy, you know, what's coming. I'd love to see what the charts are telling you here on the gold front. So if we take a look here, this is a monthly chart of gold. So there's a few layers. I want to start on the big picture of gold and then kind of zoom into the shorter term. So this is when the, the, uh, super cycle started back in early two thousands, we had the big run up all the way up into 2011. And then we've gone into this, this new correction and we started a second or another super cycle in 2019. Now what's really interesting here, Danielle's Fibonacci theory is one of my favorite tools. Fibonacci is in everything in the universe. And I use it very often for price action to identify where something is going to move to. And if we take this first massive bull market, the super cycle rally down to this low, and we just carry it over to the right-hand side, it's going to show us where the upside target for gold is. Now, this is something we were able to project over here in 2019. He said, Hey, listen, now that we've started a new super cycle, the maximum target we should see is about 27 to 2,800. And you can see, we hit that price. Now what's also interesting is the newer super cycle that started in 2015 and it hit this level. And then it pulled back here. If we carry it over, both of these cycles are pointing to roughly the same price. And so those are rock solid levels. Now, what is really interesting here is each time we've hit one of these Fibonacci measured moves, there was another Fibonacci measured move over here. There was another one over here, another one, uh, right over here and another one over here. And so you draw these levels as the charts are unfolding. And each time we've hit one of these levels, we've seen gold have this giant push up in this big rally. And each rally, believe it or not, has been 22 to about 24% to the upside. And that's exactly what we have just seen right now. So we're in this stage where gold tends to perform exceptionally strong and take off. It's hit our target. Anything after this really to me is like icing on the cake. We're like, okay, now everybody's piling in. People are really bullish on gold. So they don't want to sell, which means that people want to get in. They got to pay top dollar for it because the investors are saying, I'm not giving it to you until you give me a much higher price. And so I believe we're going to come into a larger financial correction that will pull gold back. Very similar to the 2008 pullback where gold, you know, had a pullback of about 34%. So I think that's where we are. I believe we're like right here. We're on this little blow off phase for gold. The economy's rolling over. And I remember the world, everything seemed to be slowing and coming to an end. I actually sold one of my businesses, you know, just before the market collapsed because it, you know, things were slowing. I could see it coming. I'm like, you know what, let's just exit this business. Let's sell it. And we can, we can get into something different after a financial reset. And it's exactly what I did. So that's kind of where I believe we are right now is this, this scenario in gold and gold has put in these, these kind of tweezer bars, these, these little wicks that run way up and then the price gets slammed back down. It's happened twice. They generally signal a reversal type of pattern in, in the charts. Not always, sometimes it will just indicate a pause, but once we've hit a hundred percent measured move and we've gotten into this blow off phase and we're seeing the stock market really struggle, the economic data is starting to struggle. Gold is shining. Actually one of the really interesting charts is check this out. So this is a very interesting comparison with gold, right? So if we were to take a look at what gold did in 2008, so the stock market, which is the candles chart pattern here, put in more or less a double top. It had a big 20% correction. And interesting enough, we put in a, whoops, a double top here with gold or sorry, with the S and P 500. And we have seen gold shoot higher just like it did in 2008. So stocks are topping and money's moving into gold is that defensive play. I told you, people are nervous about the financial system. They want to get away from, from the banks and all of that stuff. And, uh, and then the stock market, as you'll see, eventually sold off and it crashed. Um, the stock market fell 57% from the highs. And when we go into a bear market, it tends to pull gold down temporarily with panic selling. And then we tend to see gold shoots to the roof. So we have the exact same scenario unfolding right now. And the one thing I, the caveat here, or the one thing I should mention is everybody's going to be like, you know, this is nothing like 2008. And I get that, um, every bear market and every scenario is never really like the past when the tech bubble was this very similar situation. Um, a bear market is a when you rip out the economic data and the news of what people think are causing the movements. And you just look at the price charts price does, you know, three things. It moves up, it goes sideways or it goes down and is pure driven on fear. And so we're just at a point, doesn't matter what the reasons are, but people globally are getting nervous. They've been flocking to gold. The stock market's had its first 20% correction in this big bounce, just like it had to bounce over here before rolled over and sold off. And this is a complacency type of move, um, in the market. This is, this is what I call a complacency move. And I believe we're going to see something similar here where the stock market trade sideways for a while. And people think we're starting a new bull market, but, um, it's a very interesting scenario that the same setup, uh, is, is happening in price charts like they did in 2008. Okay. So if you think we could see a correction or a pullback of 34% in gold, then what it shoots back up like it did in 08. Yeah, exactly. So I believe if we were to use a Fibonacci retracement, which tells us where gold could pull back to based on, on the analysis in this peak, it's telling us that gold, we can just go to the peak here. And if you look at 34%, it's roughly a 38% correction from the original, uh, bear, uh, the first super cycle of gold. So that's bringing us down to about 2,200, which is obviously a pretty precipitous drop, but that is normal, um, for what gold has done in the past. And then after that, I believe it's going to be similar to 2008, where it has a sharp recovery and then builds a launch pad. And then it screams higher where you're going to five, seven, eight, $12,000. And so this is ideally what I'm waiting for. Now gold doesn't mean gold's going to pull back here, but what we're looking for in general, what I'm looking for as an investor, um, is for gold to pull back and consolidate. And I just want the stock market and the economy to like cleanse itself, have that financial crash, which will probably pull gold down with it. And then as soon as we start to see gold firming up, then it's, you know, then it's off to the races. That's when you get into gold, silver. And so you kind of load the boat up these, these, cause this'll be like the next major wave up. It'll be something like this or something like this. It ties into your theory of how after the reset, you see gold as being a cornerstone, right? Like what role does it play after this reset? For sure. So if we were to just look at this, um, financial reset, and this is 2008, the stock market started to sell off when people panic, they start to sell everything. Even the good investments like gold. And there's also margin calls, which forced liquidation and gold's a pretty small market. So it gets pulled down with the selling pressure, but you'll notice gold bottoms out months and months or a year before the stock market will, it'll, it'll bottom out. And then of course it'll be off to the races and want to shoot up, uh, dramatically higher. And gold is going to be that safe Haven play. People are going to start to say, okay, um, everything is falling. Get me out. I want to move into gold. Uh, get me, you know, it's the natural tendency of, you know, what people go to. They're like, nothing's good. Gold's holding, going to be holding up percentage wise, probably better than everything else. And so that's where people are going to want to move into. And especially when it starts to run, then it's just going to be that play that everybody's like, I don't trust the, I don't trust the stock market anymore. There's still a lot of people out there that hate the stock market because of their experience of 2008 and it's moved people permanently over to gold. So gold is that, that it'll always be worth something generally be worth more. Um, and the perfect example, Danielle is we had the power go out in Canada or the internet once, pretty much all of Canada was out for a day. And I went into town and I sat at this cafe, which had a different type of internet connection. We've got like three or four major internet providers and the main one went down and I'm sitting there trying to do my morning report and analysis. And this, this guy says, Hey Chris, how's it going? And he's like, can I sit down and talk? And he was a fund manager. And he goes, you won't believe what I just did. He goes, I went to the gas station and he had two silver rounds on him. And he says, I filled my car up with two silver rounds. You couldn't pay with credit card. Their systems were down. And when push comes to shove, gold is the ultimate currency. When you don't have any power or internet, you can still pull out a little brick or a, you know, a piece of gold or a round of silver and you can buy stuff. And I just did a whole segment on that. I just, it's crazy. You mentioned the story, please. Yeah. Yeah. No, it's, it blew my mind and I keep, I keep, I've got gold and silver all around me in my room. Cause it's the same thing. If something happens, uh, it's just like us having a generator with, with fuel, you've got to have like a backup, but gold and thing. And my big concern is if we ever do go into some type of war war to me now is like cut off the internet and we're screwed. Like crypto is worthless when there's no internet, right. But gold and silver are the ultimate. And I just, yeah, I just had a professor on talking about what happened in Spain and Portugal. Right. And he was telling me stories of how, you know, people were only able to use gold or silver, but you think this is never going to happen. And you think, well, what am I preparing for until it does? And I remember that blackout in Canada. And I was also in Montreal when I couldn't access my ATMs, like I had no access to cash. Yeah. Um, so it, it, it, yeah, we're not, we're definitely not prepared until it does happen. And you realize like, you know, crap, what am I going to do when the, when the power goes out, it only takes, well, it's like 12 days for the world to fall apart. And for people to go nuts, violence and stealing. I mean, the only assets you have is like gold and silver, a gun, bullets and fuel. Like that, that is, that is your protection. That is your, your lifeline, right? It's, you need something to barter and you need protection and it doesn't take much. And everybody moving to digital everything. I'm like, what happens when the power goes out? We can't do anything. We're totally screwed. Uh, well, thank you for bringing your charts. Thank you for walking us through that. I think my only question, I think it's interesting. You feel the retail investor is there for gold right now. Whereas my perception is, I'm not sure if they're there yet because they actually see these levels as wow, gold's expensive. And I say, well, you're not going to find it expensive in a year from now. Um, so I don't know if you have any more insights there, but do you really feel the retail investors really there yet for gold? No, I, I, I totally agree with you. I don't think the retail investors are there at all. I think the only reason gold's really taking off is because people who hold gold and like gold, they don't want to sell it. Um, so, and, and there's just people moving into gold. Not a lot. It's not like a flood of retail investors. Gold and silver is like a fraction of a percent of most portfolios. Advisors don't give a crap about it. Like nobody's really sucking it up. There is no real demand here. Um, it's just, there's not a lot of supply. People don't want to sell it because they know it's in an uptrend and they like it and it's shiny and it's going up in value. So it only takes a few buyers to drive it up. I think after a financial reset, we'll probably see the move movement of people back into gold and it'll become a big percentage of a portfolio, like one and a half, 3% of portfolios on average, which would be huge considering right now we're like a quarter or a fraction of a percent of normal portfolios. So no, we're nowhere near the retail. It's just people who aren't in it and see it every day. They have pure so much FOMO because it just keeps pushing up and uh, it just lures and sucks them in. And they're like, you know what? I have so much FOMO. I have to buy at this price. Hence the Costco bars, right? Yeah. I talked to somebody yesterday. They buy their gold at Costco. It's interesting. Chris Vermeulen, that's real talk right there, guys. Um, I appreciate your thoughts, Chris, keeping it real for us. Um, please come back soon. Sounds great. We'll do anytime. Chris Vermeulen of the Technical Traders. Great, great insights. And thank you all for watching the Daniela Kamboni show. Don't forget to get your free gold and silver reports at dannyreport.com. And of course, subscribe to our YouTube channel. Just helps keep us going, folks. That's it for me. We'll see you soon.