tv Boom Bust RT February 7, 2020 12:30pm-1:01pm EST
strategist todd horwitz chief strategist at bubba trading now bubba let's start with the state of oil opec plus has been doing everything in their power to sustain prices or with what's going on with the quota virus and the loss of demand however it appears they're still at a standstill right now and where do we go from an answer real quick oil's gone lower for now and i'll put a presentiment of the oil is going to lower right now it's in a bear market and it looks to go back into the mid forty's see knew exactly what he's going to say ok michael because the dow the s. and p. and the nasdaq probably get situated there they are set for record highs china says that is going to cut tariffs on again these $700.00 products we don't know exactly what the value of that is it's somewhere within that $75000000000.00 in u.s. goods with all the news regarding the coronavirus to seem like the markets here were set to fall we know that the p.b.s. he's been kind of propping things up in the meantime is this a move to help stabilize the china markets. of course it is just like when china
decided to print the people's bank of china decided to print $250000000000.00 on monday and tuesday of this week to try to push up the stock market i mean it's absolutely crazy look the way i look at things as this is the most over valued stock market in history if you look at the metric of total market cap to g.d.p. we are a full 2 and a half times more overvalued today that we were in october of 1987 before the nasdaq began to fall about 80 percent ok so this is the most overvalued stock market in history and 6 that sits in the context of the fact that there has been virtually no earnings growth throughout 200-1000 so wall street is hoping for this massive rebound in earnings a big boost in judy g.d.p. and what we can be absolutely sure of is that the coronavirus will prevent any significant rebound in both earnings and g.d.p.
i'll tell you what the market is going to have to look forward to is the fact that the federal reserve from is under jay powell to start to attenuate the asset purchase program known as q e 4. in april may and june of this year so they're going to diminish the asset purchase program and and the repo facility that's what he said he was going to do in the 2nd quarter that's what the market has to look forward to and it's probably not going to be very good news. and no michael i want to stick with the state of markets related to the coronavirus obviously as you mentioned i mean everything's got artificially propped up right now but we are seeing the world's one of the world's largest automakers toyota warning that it may take a hit on china's sales due to what's going on with the virus now and intend the cable company also made a similar claim to the laser manufacturer of their switch console but what i want to know is like should market watchers actually be concerned. when you see these 2 japanese companies now they're saying there is
a concern here so what do you see in there as well as such as the japanese i mean we saw a nike yum brands an apple computer you know those little tiny companies nobody cares about their role because it is these passive d.t.'s you know those companies are all warning hey we've got a problem here you know the prime minister of australia mr morrison said there are going to be significant hit to g.d.p. in australia the asian economies are warning all by the way what is the biggest customer for china is europe they are warning of this virus and its impact on g.d.p. so i mean i don't see how earnings and g.d.p. growth can be unscathed by this virus i don't know when it's going to end but they shut down major major cities in china they're still shutting shuttering their borders today so i don't think you want is going to be very upbeat for the market and i as a portfolio managers manager had to take steps to protect my clients by bringing
down the net long exposure in the portfolio i did so about a week and a half ago and i'm still in that condition today and i think there's no question the world is too dependent in entirety on china as a manufacturer into the budget let's see if we can bring him back in here because i want to move outside of virus fears if we can you u.s. treasury secretary steven newton he doubled down on the claim the boeing 737 max prices would hurt the u.s. g.d.p. he's now telling fox news that growth could be below 3 percent this year specifically due to boeing is he putting too much emphasis on the impact of boeing on the economy we know but we know it means a major player here and certainly they've lost an enormous amount of market share to air bus but is it that big. boy years shoot but again of course i mean they're coronavirus is going to hurt i mean you know again when you've got you've got no planes flying there right you've got a lot of stuff down which is another reason for the lower. prices and oil so this is going to cause
a growth problem and i think they're preparing everybody that there's no way they're going to make 3 percent i would say based on what i am now you'd be likely to get to want to have i mean this could be a fairly bad year depending on how long it takes to solve the coronavirus and of course how long it takes boeing to get that plane back in the air so there's a lot of factors here and those are just the 2 major ones that has nothing to do with what else is going on in markets that could create some problems as well michael i know you're kind of fired up this afternoon so i can i want to propose a 3rd question what do you make of this whole boeing situation. well i mean it's going as our largest manufacturer and stephanie going to help us with our trade balance when we get the planes back in the air but i mean i i'm i wouldn't certainly blame boeing for the reason for anemic global growth i would rather blame the chew hunger in $55.00 trillion dollars worth of debt that's outstanding now it's up 50 percent since 2008330 percent of g.d.p.
that is the. core issue which is troubling global growth today a massive overhang of debt that has to be loved around and by the way the only way that debt is made solvent is by placing interest rates at 0 percent forever and ever amen that's the charge that has been given to central banks i don't know why the heck they're going down this route they will eventually give us inflation and stagflation and eventually blow up the entire market especially the world of fixed income but in the meantime i guess we could just sail along creating massive volatiles in real estate and in equities and in bonds michael posner president and founder at portfolios strategies and horowitz chief strategist at bubba trading thank you so much for joining us today excellent insight.
well wall way has filed a lawsuit against u.s. carrier varieties of claiming that the cellular company pay fees for the use of dozens of patents in its networks while he claims that horizon has been using its patents without a license and even though the 2 sides have met apparently numerous times in the u.s. over this issue including just a couple of months ago they cannot resolve it joining us now with details on it for months is the. chinese companies let's face it they're typically the ones especially as of late accused of patent infringement and intellectual property theft while we as one of those companies and yet now they're suing bryson same viruses the one who's infringing on the patents what we know well it's interesting you know that now we're looking at the other side right while way this is a 3rd it's important to note there are 3rd lawsuits right now going on in the united states but they are suing for eyes and for using 12 patents one doesn't patents and they're looking for some money here now these reports came out originally about a year ago where they were allegedly asking for one $1000000000.00 they've been
meeting behind closed doors for the last year and unfortunately were not able to find a resolution so now walk away is taking legal action i want to read you the the why we statement where they say verizon's products and services have benefited from patented technology that while we've developed over many years of research and development while we is one of the world's largest companies with the largest budget for research and development that we know they have a full campus just dedicated to research and development so this is something that's been hurting them and it's not going to go anywhere we'll see how where this goes but we also do know that now while way does pay or has received more than $1400000000.00 in patent license fees while also paying $6000000000.00 of patented technology and they also own $80000.00 patents clovelly $11000.00 of those are here in the united. state and it's interesting we were actually talking about this earlier the thing that we have to also look at is verizon who is a large mobile carrier especially here in the united states they also license out
their technology to many other people so while ways looking at here is they're saying not only are you taking it but then your life is get out to other broods and that's also important right here because horizon is the one being targeted they have released a response obviously they said lawsuit filed overnight in the very early morning is nothing more than a p.r. stunt this lawsuit is a sneak attack on our company and our nation and the action lacks merit and we look forward to vigorously defending our company and our nation so that's they've come on there a sneak attack on our company and our nation while ways doing a sneak attack on the nation how much of that statement how much of rice's posturing right now plays into this wall way is the big bad boogeyman to spying on everyone and into those fears if they're filing a lawsuit against you even if it's a frivolous lawsuit that's not an attack on the country and you know that's how it's being framed it's really being framed as us versus china right right i mean that's essentially what it is and what we're looking at here especially because
verizon or wall way i'm sorry has said time and time again that they are widely known within the industry that they are far more ahead of 5 g. they have also said they own a lot of these patents and not to mention that a lot of this 5 g. technology is built globally so it doesn't just come necessarily from one person right now while we have determined they have evidence to support that there are a dozen patents that risin is using last year they were looking at possibly $200.00 over $200.00 that they were going to sue for and we heard a c.e.o. of way last year a year ago saying that he was concentrating on business grow sure he wasn't going to go through with the last 2 until he had more time and here we are now seeing legal action and probably also dealing with this thing called fighting off the u.s. government ceremonies as they are correspondent thanks so much thank you time now for a quick break but hang in there because when we come back to venezuela is back in the. headlines as the u.s. is once again talking about overthrowing nicolas maduro but there is an untold story about what is happening inside been his late wife as the nation's economy is
pretty good. now you want to 1st correct that. no. ball 5 being cut. coming. out and finding another one and i used the mcdonald's way you don't think the food. bank itself mukti it on. plus in this way got to dog it so hard not to think of the mother disappeared this woman the work of the day i was and i don't mean to start then if. this is the only
thing that we do is music because everybody fights his way. to. the floor you can feel the fee on this bill frist woody allen and if you have a whole movie about a box of the death penalty on the. books what i think is this is the fans that is a constant. cool. welcome back argentina's senate passed
a bill on wednesday that would allow the government to restructure debt issued in foreign currency argentina has been dealing with nearly $100000000000.00 in sovereign debt including a 57000000000 dollars package from the international monetary fund now president and as who assumed office in december after running on a platform critical of that giant i.m.f. loan so the country will face issues paying down debt until they are able to actually stabilize and grow their struggling economy fernandez is currently on a diplomatic european trip and found an ally in french president amanda mccrone who said france will stand by you and mobilize with the international monetary fund and other partners to help argentina get back on the path of growth of sustainable debt now meanwhile wednesday arjen time economy minister martin guzman and i.m.f. managing director krista lena. discussed the issue in vatican city at a meeting hosted by pope francis guzman reiterated that argentina could not continue to service this lote pope francis who is arjen time did not directly
comment on the specific situation facing the country's debt venezuela hasn't really made very many headlines lately and certainly talk of overthrowing the country's president nicolas maduro has been relatively quiet that is until this week when the u.s. backed legitimate i'm doing air quotes you can see the president of venezuela one why though he suddenly popped up at the state of the union on tuesday then spent the day with president trump on wednesday at the white house in fact why those presence at the state of the union was really one of the only bipartisan moments of the entire night. at the. all americans are united with the venezuelan people in their right yours struggle for freedom thank you very much. so it seems that the effort to remove material from power is back up but over the past few months something fascinating has been taking place in venezuela instead of continuing to push forward with policies as usual the madero regime has reportedly shifted to opening the country up to outside
investment and more of a capitalist system according to the new york times quote shopping malls that were deserted just 6 months ago are bustling and imported s.u.v.s course through the streets new restaurants and bars are popping up weekly in the wealthier parts of town there are tables packed with foreign businessmen fashionable locals and government insiders in his speeches madeira is still promoting a vision of venezuela in which all of its resources are shared by all but according to venezuelan economist remember the gap between rhetoric and reality is greater than ever the fight for survival has forced the government to become more pragmatic quote only the narrative is still socialist again according to the times the government has slashed red tape and turned a blind eye to taxation fuelling a boom in private exports of everything from oil to chocolate enriching the politically connected and traditional business elites joining us now to discuss the host of the news with rick sanchez rick sanchez and producer dr rick rivera who has
a ph d. in latin american history with a focus on political economies and venezuela welcome to you both thank you and we can actually start with you here because this report. is coming out of the new york times so we already have to preface it with that but it's talking about the fact that in rural areas we're certainly still seeing a lot of poverty lack of water basic resources but in the city of caracas specifically there is this kind of surge that's happening here is there a gap reforming between super wealthy kind of capitalist people in the cities and the poor people who are the socialists in the rural. communities what's true and what's not well as you said this is the new york times and so there's a great deal of misinformation going around regarding been a swell and the economy is no different just real quick i mean as far as the water is concerned i mean that problem really surfaced last march when the business well as electrical grid was hacked and soon afterward why go ahead declared himself
president and that's where you had that water crisis but thankfully that has been largely resolved. as far as your question i mean. people were given the impression that business well is kind of like soviet russia before the reforms of the eighty's heavily communist as opposed to completely government run can a me know china in the 7 before the seventy's etc but the reality is that private enterprise and capital investments have played a huge important and critical role in the history of been a swell under charges and under my little and so the reforms that are being implemented by my little are yes pragmatic but but they're not that huge as the new york times is reporting i think the real story here is that business while us economy is slowly getting back on track there's the impression from investors that the worst of this economic depression really is over and that business well is back
in business as it was 5 years ago and i think there's a i think that as well the stands guys as a test case for us are germany and i really believe as strong as this country of ours is in its ability to convince the world you got to go our way or the highway sure that somehow this particular administration has created even as much as we've seen before where countries look at the united states and say you know that's not kosher that doesn't seem fair so. when a guy like madeira goes to the e.u. or goes around the world obviously russia and china are on the side of the duro and puts his hand out and says i'm a poor victim look at the united states is doing to me he's more apt to be able to get more cash flow actually even some subsidies that are helping his economy whereas he would of if the united states were beating him up so this this
intervention on the part of the united states i believe is backfiring just as it did in cuba for 40 years and rick i want to go to kind of a media perspective on this i mean you've been doing this for i don't want to insult you or 2 years ago i had to you know we see everybody you know double. partisan group of lawmakers making this kind of same push for quiet oh versus madore see the most of the mainstream media i mean as ben mentioned this is a new york times story don't take away from it but is that narrative to do exactly what enrique said to keep it as a socialist communist bad everybody you know capitalist society good so you know that's an interesting theory what you're basically saying is that deep down the united states doesn't want the problem to go away because the problem in and of itself helps them get elected something bill clinton found out when he was one of the last democrats who was able to get votes in south florida and he actually won miami dade county but ever since reagan. the vote in florida has gone
republican part of it was because of the reagan mystique but then along came a little boy named elliot gonzalez and that changed everything that was in clinton years and since then florida votes republican and that's continue to vote republican and this is smart politically speaking on the part of the trumpet ministration to have why don't there to tell the people in south florida look we're looking out for you do they really care about changing minutes well probably not but having why don't their gets them votes and gets republicans elected but there is a failure that's taking place here right because if the u.s. . has this system set up where they say saying sions are the answer we're going to choke out and the only way to really get rid of them without sending troops on the ground which don't put it past him to do that i was on a call earlier this week with reporters in the white house and they were having this very discussion about venezuela was hoping for a chance to ask a question because the question was our troops going to be on the ground there and instead the questions were all about you know you know how are the same should work
all the sanctions are working but right now it seems like distinctions are not working if it is true that material has adjusted some of his positioning to say well we're going to bring in outside investment it seems like he is within the last few months has been a pretty good job of adapting to what the u.s. was thrown out of the same way we did a report just yesterday that russia has done the same thing the 24 team of crimea that russia has adapted their economy to work with sanctions if they can't make the people starve enough to push out the government if they can't get the military angry enough to overthrow the government is the u.s. ultimately have a failing policy of sanctions that used to work but doesn't work anymore well the sanctions are certainly affecting business well i mean it really is strengthening the economy it's a blockade really and it's similar to what's going on that's been going on against cuba for 60 years i mean the business well as is dependent on oil and their major source for exports is the united states and that market is largely cut off so
this is having a huge effect on the economy. it is certainly not just just they certainly have adjusted in the sense that sanctions are new to this country and they frankly just didn't know how to cope with them but with help from from allies they are figuring out how to get away from them and oil production is increasing for the 1st time in years and it's capitalist is capitalist economy beginning to grow in some of these cities and i know that's a weird word because number but it means a lot of things but here is where the. new york times and the establishment media has always kind of got venezuela wrong but as well it never went communist ok in venezuela you see things that you would tribute to a communist regime like freedom of the press they still do this day and throughout the chavez years and throughout the years literally had people on the air criticizing you know the government and they still do and they still do so to sit
there and say oh it's a horrible communist regime kind of never it isn't and it never really was that's kind of the propaganda that i think we're fed that's not to say it's a great system but it's definitely a different system to try to say as you said the soviet union china oh and in israel and they're all the same is an ignorant view of it correct it is ignore it it would probably the right word choice rick sanchez the host of the news with aptly named thank you for being here to serve as their doctor and making rivera appreciate you both thinking about it and much become and that's it for this time you can catch boom bust on demand on the brand new portable t.v. app available on smartphones through google play and the apple app store by searching portable t.v. or stream us to your t.v. by downloading the portable t.v. app on apple t.v. and online portable t.v. with t.v.'s coming soon to more devices and as always you can hit us up at youtube dot com slash boom bust r t nothing ignorant about that see you next time. in
this community there are people who believe that it's ok to sell for x. it's really hard there are no jobs and you see that i've got kids and ask and as a parent. i can come up with logical arguments there's a lot of conflict and again. between the close of the conflict i would say. close one on the children's each other is good business the state of california alone makes $6000000000.00 a year of prison complex just to get some point in your life where. you don't care . join me
every thursday on the alex sullivan show and i'll be speaking to guest of the world of politics sports business i'm show business i'll see you then. thinking of getting a new phone the ones we got in here shows no problem was he didn't know until he was trapped in this tiny little wired how much we're going to need a crate with him he will just. freaking out and she will want to spray him anywhere near. breeding dogs or caged in the in human conditions on puppy farm i mean 67 years you know they've been locked up in a cage outside you see no protection from the weather the heat you know the courtier the rain the snow the funder they have no protection. to let you. know it's ok. across the u.s.
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a very warm welcome to you you're watching us and see. danger in the skies of syria how passenger plane narrowly avoids being hit by a fence is reportedly fired in response to an israeli missile attack. meanwhile damascus defends its military campaign against terrorist groups and emergency session of the un security council the western powers accuse it and more scope of endorsing destruction. the sheer scale of destruction both endorsed and facilitated by russia shows that neither they nor the assad regime can be trusted to deliver a ceasefire it is astonishing the desire of some western countries to cross to terrorist groups and it is the moderate opposition. terminations to stop tariff and