Intro

New York Times’ bestselling author Larry McDonald, founder of The Bear Traps Report, returns to The Julia La Roche Show to explain why he believes the market’s surface strength hides serious stress underneath. He points to cracks in AI data center financing: canceled data center IPOs, collapsing CoreWeave bond prices, and a surge in convertible bond issuance from neoclouds, which he calls the “last saloon” warning sign last seen in 1999 and 2021. With consumers hit by higher rates, soaring diesel and jet fuel costs, and iconic brands like Nike, Home Depot and McDonald’s down sharply, McDonald argues the Fed is “faking” its hiking cycle and that smart money now expects three rate cuts before three hikes. He describes an internal market crash masked by passive flows into mega-cap tech, explains the year-end “convergence trade,” and makes his case for why gold could run from $4,000 to $6,500 and why silver may be one of the best trades of the next 12 months

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Links:

How To Listen When Markets Speak: https://www.amazon.com/Listen-When-Markets-Speak-Opportunities-ebook/dp/B0C4DFVFNR

Colossal Failure of Common Sense: https://www.amazon.com/Colossal-Failure-Common-Sense-Collapse/dp/B002IFLWMK

Twitter/X: https://twitter.com/Convertbond

Bear Traps Report: https://www.thebeartrapsreport.com/

Timestamps:

0:00 Preview: the Fed is “faking” its hiking cycle

0:19 Welcome Larry McDonald

1:20 Learning from mentors and “cage matches”

2:06 Why AI data center financing is breaking down

4:53 Convertible bonds: the “last saloon”

8:31 The ConvertBond.com story

9:09 Credit warnings: canceled IPOs, CCCs and leveraged loans

11:15 The million-dollar bet: three hikes or three cuts?

11:49 The consumer takes four or five left hooks

15:13 Why the Fed is faking its hiking cycle

16:28 Record highs, but an internal market crash

21:02 Passive investing and the convergence trade

23:19 What could trigger the convergence: AI capex and the midterms

24:43 The case for gold and silver

27:28 Silver, solar and the rotation out of tech

The content of this podcast is provided for informational, educational, and entertainment purposes only and does not constitute financial, investment, tax, or legal advice. Nothing discussed should be interpreted as a recommendation or solicitation to buy, sell, or hold any security. Guests' views are their own. Always do your own research and consult a qualified financial professional before making investment decisions.