We welcome Guy Cohen back to the podcast. Guy is an author, trader, technician, and market analyst who brings great insight into the current conditions across the markets.

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Video Transcription

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Tim

And welcome back everybody. I’m very excited to data to welcome a friend of the podcast, a trader and investor, a great mind. Somebody I’ve respected for a very long time. Guy Cohen is back to join us. Guy. How are you doing today?

Guy

Doing good. Uh, we’re very fortunate that this lockdown we, we can work through the lockdown. In fact, it’s a, it’s a good time for us in a way, but obviously we’re highly aware of the fact that it’s not great for a lot of people. So I’m here to help.

Tim

It’s one thing about being an investor, a trader, and an entrepreneur who can work from home with computers. I see your set up there., you’re broadcasting from London, which is where you’re based. I mean, that’s where you’ve, uh, been, running your company for a long time. Uh, you’re from there originally as well, right?

Guy

That’s right. So I’m, well, I’m nearby London, so just outside suburbs and, uh, you know, it’s a look. It’s, we’ve got it the same as other people. Obviously the US and UK are probably the worst affected countries. We’ve, we’re very fortunate in an area that doesn’t have there much of it. Um, if you look at the map, there’s not been that much around us that might change. Um, but we’ve got the added complication of we’re about to have another baby in the next two or three weeks. So, and it has been a reason, uh, eventful, uh, pregnancy as well. So we have a few things going on, but you know, by and large, we were so lucky. And, um, you know, as I say, we’ve been able to, you know, trade as normal, if not better. Um, can continue with the research that I have. I have a full-time research quantum team and programming team and we’ve launched, we’ve launched a fund in this time in the last two months, um, and within the US that is to, uh, for us, RIA is, um, and it’s full steam ahead. So my team is busy, I’m really, really busy and we’re very grateful to have this as our chosen field. You know,

Tim

and I’m not even sure I can do it justice to give you an intro here guide. But for anybody out there who’s listening, who does not know who guy Cohen is, a guy is a, an author, he’s an entrepreneur. He’s built trading systems. He’s been featured on Reuters and the New York stock exchange and Bloomberg and all kinds of stuff. Guy. How many books have you had published by the way?

Guy

 Well, let’s not count the self-published ones because they don’t count 1000 self-published ones. No, it’s for by real proper financial times, uh, at the Prince hall and also Wiley and all out of New York. All my stuff is American. You have the best markets, the most liquid markets, the richest markets, the best markets for stocks, and for options. I only do stocks and options and um, the software I developed was licensed to NYC Euronext, um, and life exchanges, obviously, NYC inhaled both those exchanges. Um, and they licensed my software, my options software for over nine years. I did some analytical work, the international securities exchange as well for that options data. Seeing if the, you know, whether there was an edge in that data. And so, uh, and obviously I’ve worked with alongside brokers and now we’re actually, uh, my algorithms are running investment funds for registered investment advisors in the US so, um, we’re busy and I once to get to talk to great people like you who add a lot of value to people and really love to do that. And I love doing that too. So, um, this morning I had a one-to-one, I have a very few one to ones. I had an event two weeks ago in Miami except for, it wasn’t in Miami, I was broadcasting it from here, but it was our two-day event in Miami. You guys have got to come over next year because it’s wild fun that we do it in, in Miami beach. We have a lot of fun., I have a very strange relationship with my members. Um, we had an 80% return rate as in re-attend rate for this event that it’s, it’s pretty much what we normally do. So, um, that was pretty cool with, well, there’s quite a lot of new people coming. It’s amazing. But we normally hold these particular options, one in Miami in April, two days. Obviously we had to change it to being all online. We’re pretty well equipped for online as you as you are.

Tim

Yeah, we do everything online. I mean, thank God for zoom and online, right?

Guy

 I mean I’m doing a sort of live stream from our physical events for seven years anyway and it works really well because three-quarters of people go to do the online one. They see me on the camera and, and they, they feel they’re part of the event because they’re getting alive at it either with my screen or with me or the crowd. And so we’re used to doing that. But this one had to be all done from home. But it was a record attendance. But the funny thing is, is that I have a weird relationship with my members in that we become friends, you know, we get to meet, we’re, we’re, they’re real people. I’m a real person. I’m very, uh, I’m very approachable. I make myself approachable as far as I can. And we, you know, I’ll take them for dinners and they’ll take me for dinners. They give me, presents, my babies and my dog. And it’s a very interesting relationship. Now part of that is fueled by the fact that I’ve made them a lot of money. So we have this kind of thing that of course, we’re going to be friends if they’re very happy with me. Um, but it’s a really lovely thing. And um,

Tim

I think it’s more than that. My friend, I know a lot of educators, I can tell you this, it’s your passion as well, which is what I’ve always picked up in your books. And one of the reasons why I follow you and really love having you on the podcast. I think it’s more than just the financial return. I, you know, people build relationships and uh, and whatnot, especially if you’re providing value in a time of uncertainty. I mean that, and that’s the world we live in right now. There’s so much uncertainty. I wanted to get your perspective on several things here guy. Cause I think it’s a fascinating market. Number one, we’re recording this early. May a five, four 2020. There’s an old adage in the market sell in May and go away. We’re 65% reported through the earning season, which by the way has barely been being depressed expectations. But this is a crazy world. We live in guy early March. Like you were talking, we were talking as well through February and March about this Colvin 19 situation. The potential for disruptions in the market. You actually put a tweet out there, I think on March 4th or fifth, uh, looking at a pivot where you were thinking it was going to go to the downside number one. So yeah. So how did you get in front of it? So early number one, it was a classic.

Guy

 Yeah, it’s very easy actually. I don’t know whether I can share my screen, but I can just show it to you. It’s one of the classic patterns that we, that we look for. Obviously it’s not going to happen that much. But one of the key things, I mean, so what I do is I look at what options traders are doing. And it’s not just based on volume. Volume does not give you enough for start volume doesn’t give you, which is the buy-side, which is the sell-side. So that’s a problem. You don’t know whether people are doing covered calls, which isn’t necessarily a bearish thing is it? But you, if they’re selling calls, Oh, it’s bearish. But it might not be barest. It might not also be bullish. It might just be one of those noise things that doesn’t really matter. So the quality of the data that we’re looking for and how we analyze what is going on with options activity, whether it’s open interest or volume or implied volatility. And the cake that we make around that is really important. So it’s not just quantitative data is qualitative data as well.  So what we look for is a feel of whether it is positioned building activity we’re seeing or whether it is, um, noise, which we’re not interested in or, or whether it’s hedging, which we’re also not interested in. Because the most powerful of those three is position building. People are laying down risk, you know, heavy risk, uh, with leverage in order to build a position. And we want to tack onto those guys because on balance they are likely to be, I was just looking at my dog though, uh, see if he was coming in, but it’s likely to be the bigger players. Obviously we can see that in the volume and open interest and likely if they are bigger players to be the more sophisticated operators who have access to better research. And they’ve certainly spent a lot more on research than anyone else. So I want to ride on those guys’ coattails. Now let’s go back to where we were. This was, so the tweet I put and you know what it’s like guys, you know, when you put your neck on the line, you know, you’re out there to be, to be crucified sometimes for should be beaten up. Yeah, for sure. But it’s really worth it sometimes. So this is what I felt very, very confident about. So it was really a win-win situation for me. Um, there were a few things that were going on. One, my indicator, my options indicator, we call it the option’s volatility indicator. OVI for short was just flashing red everywhere. So I knew, and this was, this was reminded me of another sort of crashes we’ve been on to, and I knew we’d already had one leg down. This was just lining up for another one because we were retracing, so I call it, uh, I’ve got a set up called the pullback retracement. So the pull, the pullback reversal, and it was just perfectly positioned because a lot of these pullback reversals we’re seeing on key stocks we’re doing. So having crossed down through a 200-day moving average and then bumping their head back on that 200-day moving average, it’s classic even without that 200-day moving average. But with a, with a persistent negative OVI as well. You just rub your hands for the entry point. And so it was on second of, well your time would be the 2nd of March my time. It was. I mean if I look at the actual timestamp of the tweet, because it’s kind of interesting to see, it was at 12:17 AM so early hours of March the third, so for you easily March the second after the close of course, and if you look at that, I don’t know whether I can show you a chart of that.

Tim

This is mostly going to be broadcast audio so we don’t have the visual. 

Guy

 We’ll just go and look at yourself. A nice charter, whether it’s the S and P or the IWM or whatever it is and the IWM is very instructive on this one. Been really, really well correlated and loads of key stocks. Well at that point, yes, it still went up for another couple of days, but that’s not our entry point anyway. We’re just waiting for this thing to happen and then literally we have a launch then happened. 

Tim

You talk a little bit about big money and how you’re following those guys around. You know, famously, even bill Ackman came out and said, you know, we were going short, early in March, things like that. Big hedge funds were doing that. And I remember on three to early March during that period, I was teaching a live class in New Jersey, uh, about stock markets and, and technical patterns. I remember that day very specifically, markets were flashing barrier signals and you kind of got in front of it. Uh, and we even know this now from banker and ex guy, you know, after the banks came out and reported earnings the last quarter, they said even though we had losses in other areas like credit services, stuff like that, they made money trading, didn’t they, you know, with the volatility. So once you saw the signal, how did you play it down? I mean,

Guy

 There were a few, well, there’s lots of, there were different issues, um, as in lots of different securities. One could play in that. So there was one setup that we played, uh, which was called, which is called the railroad track. So as the retreat, the steep retracement was, was captaining and bumping its head on key levels, um, that was forming what you call a railroad tracks. So a railroad track. In this particular case, the retracement was going up. So bar one bar was hollow green as in open low, closed high, and then the next bar the next day did exactly the opposite and just ate up all those gains opened high, closed low. That’s a setup entry point. If the next Bob then breaks below the low of those two bars, that was one set up. And the other one was just a straightforward kind of flag set up either crossing downwards through the, sort of the diagonal parallel of that little bear flag, um, or hit or passing through the low of that bear flag. So there were several instances, whether it was indices or individual stocks that were doing exactly that and lining up for us. And, and of course, my filters find them in a second. So that was what we did and I just wanted to give everyone a heads up. I also, I also wanted to show off a little bit because I thought, I know I felt so confident and I thought I just can’t lose here. So, that was really the, Oh, there’s a little bit of point. The scoreboard right when you hit. Oh yeah, come on.

Tim

 I mean, I think naturally we all do that.

Guy

 There’s no one was so low risk, you know, cause people to go, someone of my, you know, people, they gotta go, God, can you do more, do more of that. I go, listen, I’ll do it when I know I’m going to be right. You know  I’m in tennis. Like if you’re old school, you know, think of the difference between John McEnroe and Ivan Lendl. Well, it may not be that sexy, but I’m an, I’m a, I’m an Ivan Lendl I preferred Mack cause he’s exciting. He had the feeling of the touch. But I teach people how to be Ivan Lendl now. Ivan Lendl actually went and won more majors than John McEnroe because he had a system.

Tim

 John, I got to look him up now. Is he, I mean, I don’t know what the, I mean, I’d have to find a different sporting analogy, but, but you know, no, You’re good with it. Is he British?

Guy

 No. Even Lendl was check and John MACRA is obviously from New York, but John McEnroe, you must know him. Oh yeah. Fiery. Yeah. Yeah. But yelling at referees, 100% talent. I mean the, I mean, in terms of raw talent, that guy could flick his wrist and do, making possible angles that PE Fagaras hadn’t even thought of. Whereas even Lendl was rather than dull, rather metronomic he had a system. But guess what his, I mean, of course, you’ve watched John McEnroe every day, but not everyone can be a John McEnroe. Right. You just got born with that. And that’s the same with trading. 99.99% of home-based traders cannot be macro when they’re trading, but they can be if they learn the system is Blendle and they’ll make out really well.

Tim

Sure. Which is where rules and systems and, and that’s true for trading as well as investing in my opinion. We’re going to move this forward to kind of where we are now because I do find it really fascinating that you did kind of nail that in early March. Uh, but then, you know, obviously that’s now history. We had the market crashing one of the worst months in the history of the markets during March, found a bottom there. It’s now in somewhat of a V shape recovery. I don’t believe in the, in the rally here personally Guy. Just anybody who listens to me knows I’ve been on the fundamental side of the bear side of this. So where do you see the market today? I mean, we’re sitting here on a pullback and uh, after a huge V-shape recovery.

Guy

That’s right. So, so this is the next thing I did. Okay. Okay. So guys, are we going to be brave again here or there? So, so I had that whole chit chat with me, with my, but I go look, look at this chart. There are two things they’re going to happen. Once we were, we’d hit the bottom. We were obviously slow traversing and sort of like mid-March. There are two things I think could happen at that point and I was open with it and they’re all my videos and my weekly reviews. The first thing had happened is look at the chart of the 2015 flash crash. Okay. That can happen so we could bump along for a while and then we’ll see because we were only in the first phase of that, that new bounce when I was talking about this, the second thing it can happen.  I didn’t think it was going to happen, but it did and that’s where opinion has to be removed from the equation. But the second thing that could happen, I said was that we could drift up to pretty much near the 200 day moving average. Now, if that happens, obviously we only do our favorite stock. By the way. Can I just tell you what my favorite stock is? Sure. Okay. Write this down. Everyone. Write it down. Okay, I got the ticket. Here’s the ticker you got. This is the one you should trade every. This is the one that you’ve got to trade by your life. It’s called M, T, w, Y, S. And if you look up that ticker, look it up. What you’ll find is there is no such ticker. Yeah. What it is, is trade what you see now, what does trade, what you see mean trade, what you see. And all my members just tell me that mantra back and back. What it means is that whatever the system is that you are trading, and I went, Oh well that’s it’s Obi. We’re looking at options, trading activity in a specific way that no one else looks at. But we’re looking at specific setups with you have a specific combination of setups if you like. And that’s what we see and we’re only going to go when that system says we should go. So trade what you see. Um, so here’s where we’re at now. We didn’t get 2015, uh, sort of, uh, flash crash and then sideways move. And then recovery. What we actually had was a V shape, but this Bishop kept on going on and on until many issues were either at their 200 days or near enough, even the S and P was within a little notch, you know, within a few of it. And that then now you start to use a bit of logic to go, can the markets really be higher today than they were for the beginning of January? And it’s a question we’re still going to trade what we see, but can that really be the case when we know that it’s not just a, a blip that’s happening? It is businesses coming grinding to a halt. Sectors grindings will hold industries grinding to whole consumer behavior and the entire fabric of society having issues. So let’s just take Miami where I held my event, we hold it at the national hotel, great fun that’s closed down. All its suppliers will have closed down all the people who then create the coffee and the lesson of that, they’re all closed down. This is unprecedented. And to think that we can just emerge from this in what, six seventh week of lockdown in the UK? Uh, I don’t know what it is for you guys over there, but it’s obviously different from state to state. Um, we’re kind of like your 51st

Tim

I’ve been locked down for almost eight weeks probably personally. I think the U S went into lockdown about March 13th or something like that, so probably seven weeks now. I would guess the impact of that. What is the impact of every

Guy

fresh week of lockdown or effective lockdown? How long does it take them to recover? Look at airlines. We’re going to end up with potentially worldwide, less than half the flights that were available before. And then what happens is a knock-on effect to the resorts that we were going to before completely blahzay about. So the economic impact in my mind, like you must be profound. The market has seemingly, and again, I guess I talk in kind of vagaries, but kind of like to my opinion, which I want to take out the equation could, we could trade what you see, but it’s like, it’s diluted and I don’t know what’s going on in that way, but when I get clear bearish signals at this point, and by the way, I have written this up to a large extent, but when I get clear signals that I can safely go short again or by yeah. Deepen the money puts, then we’ll be on it. Um, because of this, it feels like it’s the right thing. But again, TWIs we will trade what we see in terms of the system that I, that I do. And, and so pretty much I’m with you.

Tim

Yeah. I mean, fundamentally I don’t think there’s really even a debate, quite frankly. It just depends on how much of this stimulus is going to actually come through and help people. Uh, you know, obviously there in the UK, I think about consumer behavior guy. I read a report today out of London that 65% of people when pulled an asset out, we’re not going out and living our life the way we did. Now that I’m just, I’m saying, I’m saying that kind of wrapping it up in a whole survey, but they ask them questions where you go to restaurants, where you go to crowded gatherings, where you go to this and that and many people say whether you lock me down or not, my behavior will not be the same as it was before. Right? I think before pre-vaccine that’s going to be guys off they go to the vaccine.

Guy

I think that, how rude can I get on this or is it you can say, are you good, God-fearing folk or can I say something nor say whatever the hell you want. Right? Here’s the, here’s the thing that I want to look for is I want to know which drug companies are making all the, all the medicines and treatments for STDs because once it’s locked arms over all that single community of all age groups are going to go crazy. And if you don’t believe that, you better believe it. They going to imagine that you were single right now. You’d be going nuts. And when this happens and you’ve got the tender going, they’re swiping and who knows what you’re talking about on the phone that’s going to go bananas. But, but one thing I will say is I did call a low, um, during that time, actually in, in the sort of early may time I said that the, what was a meaningful low for the markets was the Trump election levels of 2000 of November 2016. Now, uh, I called it, uh, in the two 21 hundred, 2100 odd for the S and P. Now it didn’t quite get to 2100. It was very close. I got into the 21 hundred, obviously, but the Dow did meet the low or the level of the Trump election. So, and I see that as a very significant level and uh because it’s a psychological level and especially now you’re in election year again. So it’s going to be really interesting to see that in the next down cycle as I think there’s inevitable, um, how far to that we get again and potentially whether we actually take it out. 

Tim

You know, it’s interesting that the STD call I find fascinating in economics, they call that pent up demand a guy.

Guy

But you’ve been thinking about it, right? It’s like, come on, let’s be, let’s look at it.

Tim

 Let’s go and make this all, get out there and live their life.

Guy

 I go, well, look, we’re expecting our second baby, I told my wife, look, I’m out of that whole thing now. So, you know, don’t, don’t look to me for that. I, I’m done with all that shit. I’m 49, so you know, I’m done with that 

Tim

The second baby’s exciting though. Congrats on that. 

Guy

And they all call me when I go to school with my first who was three and a half. Um, obviously we’ve been locked down, but they always tell me my grandson’s doing really well, so that’s good. I want to get your take on a couple of other areas across the market, crude oil obviously when negative pricing here recently I’ve seen the contango starting to tighten up in that market.

Tim

You probably track both brand and light sweet out of the U S uh, what’s your read on crude in far as how it might impact global economics, what it can tell us and what you’re, you’re thinking about moving forward.

Guy

 I’m not looking, I’m not an oil expert. Um, but, but obviously you know, there’s going to be a point if I look at it all the OIH for, for example, I see that you know, a bottom looks like it’s in and I would, you know, with enough enthusiasm with enough. Um, and again I’m very myopic with what I see in terms of I’m very, very narrow-minded with, I see, I look and see what the options guys are doing. I see if they’re potentially giving me a heads up, I look to see if the chart is giving me a safe entry point where I can construct a very conservative trading plan round and see if I can pinch a bit there at an hour and even write it for now. Um, there is no point, but there’s obviously a chance. If you look at my charts, OIH, and others, you know, whether it’s slumber J or those kinds of people, it’s a different landscape today to what it was say, you know, a month ago in terms of at least the leverage going into it. But it’s not safe yet to enter. 

Tim

So the holders, those are companies, right? I mean, so you’re more likely to play the oil companies than the, uh, you know, the commodity itself is that,

Guy

 well, no, I’m, I’m more likely to pay where a play wherever I get a very, uh, very clear signal. So that’s the bottom line for me is the clarity of signal that I’m, I’m getting, if I don’t get a clear signal, then forget it. I’m not interested because it’s, to me, it’s all about following what options traders are doing other than big options traders are doing. and whether that activity looks like it’s more like position building than, than, than hedging. And I think to be fair, um, there are better plays to make at the moment. So, you know, unless I see something very clear and obviously you can see in the last couple of days it’s back down again. Um, unless I see a very clear signal that yeah, we’re on for something, then then there’ll be other better things to do. 

Tim

Sure. what about gold? 

Guy

I mean, is gold something you target something you’ve been focused on pro? Yeah. Well, this is very interesting. We say about gold because you know, you’ve obviously got the golden and the got the gold miners and it’s, it’s jumpy and volatile. I mean, it’s extraordinary for such a well-treated, um, sort of issue where the, you know, the ETFs, it’s been very, very jumpy. So I made a bit on nugget, uh, before it went for two to one rather than three to one. Um, Newmont mining was interesting. So, and I, and I’ll tell you why it was interesting. So Newmont mining in sort of late March, early April, again it crossed the 201 way, then the other event consolidated and then the options traders started going in and then it breached, you know, just over 50. That was one of my setups. So that was great. But again, uh, you know, I’m going to be so boring. I look for my setups and if I get my set up then that’s great. And if I don’t get my set up, I’ll look, I’ll look another way. So Newmont mining, have a look at that chart and you’ll see early April what happened.

Tim

 Oh no, those miners, even the GDX and some of them about that time period, they were high basing and you got that nice signal, beautiful candle on Newmont. And the miners are an interesting part of it. I still liked GLD by the way. I liked that product, you know, especially as an investor. I know trading and investing a little bit different mindset, but I do like the ETF. GLD is a way to get exposure to gold. 

Guy

Well, it, well it’s got the GLD as far as I remember, is actually backed by real assets, isn’t it? Yep, sure. Yeah. So, so now nugget is a real tough one because nuggets, you can get the direction right and still lose money. So yeah, and I’ve been on both sides of that coin with a nugget. So, um, I remember doing one train, I got, this is great cause Gold’s going like a train. I’m good but screw that. I’m going to go three times leverage and I’m going to go the options three times. I lost, I think. How can this possibly be? So the algorithm that with the three times, you gotta be a little bit careful with it sometimes. And so, you know, from camp, those leveraged ETFs are only for traders. I 

Tim

mean, if a beginner’s out there, I usually try to steer them away. Keep us, isn’t it? Isn’t it easier to make a simple trade? You know, find a simple chart. You don’t necessarily need the leverage when you’re a new trader.

Guy

 That’s true. But, but Tim, let’s be honest. Um, you know, even you have that little devil inside you that does something a bit naughty once in a while, right? Yeah. Guys, we’re all human beings, right? I think I’ve got you in one of those moods. Like you’re ready to take some risks. There’s no, well, no, no, I’m, look, I’m really, so it’s a bit, but part of the system that I have created for my it, which was really creative for myself, acknowledges my own weaknesses. And I think that there are systems out there that have merit, but they forget that you’re a human being. Sure. And that is a major weakness of those systems. They say, you know, when you see people go trade robotically trade like a robot trade, like a machine, we’re not built that way. We are built to break the rules. And so what one has to do is build rules that one can take with relative ease, um, in a way that acknowledges our human frailties. And you know, when you know, I, I would, like I said, I did this one to one this morning. I’m only doing two this year, so that’s great. For me. But um, whereas my, my team are doing the other ones, but you know we were having a chit chat and the guy obviously he has the biggest problem that he has is in securing, don’t have to take it, but securing that first conservative easy profit level and because he always thinks there’s a little bit more you can get and that’s the biggest mistake that traders make.

Tim

I find having a, having taught mentored students and you know all over the world and one-on-one for, for the better part of 15 years now I find people are in two radical camps on that. You either got to grab them by the collar and hold them back because they want to take too much risks. They’re just so ready to go in there all the time. You know, push all the money in over leverage or sometimes you gotta push them in the back end and just make them go for the swim. You know, get them into the market.

Guy

Yeah. Oh yeah. Cause they get the inertia they got, they got the fair, they got the inertia and it works. And I suspect that you have experienced both as, as a trader because if you’ve been in the game for any time, there are times where you’ll get whacked cause you broke rules or didn’t have rules or whatever. And then, and there’s that little bit of nervousness and it takes quite a lot to get back on the horse. Um, so I, I’ve known that I’ve known pretty much every experience there is the having trading. And that’s the system that I’ve developed, not only acknowledges the fact that there is an empirical basis that must be there because otherwise, you’re just whistling in the wind. But there also has to be a plan that, that can cope with the fact that we are emotional and human beings and we’re, and we attempted where we’re easily led astray. So if you have a plan for, you know, a discretionary plan for a home-based trader, if it doesn’t somehow, um, take care of that human, that human component, then it will be doomed to fail. Cause we’re not robots, we’re not, we’re not machines.

Tim

Just two more questions for me. Number one, over the weekend we saw our president, President Trump, uh, re, uh, you know, kind of banging the drums of the rhetoric of nationalism and talking a little bit about China and tariffs again, uh, and even Pompei but on pale out of his administration saying, Hey, listen, we want to do more American made goods and uh, change the supply lines and things. Do you think, uh, and on the China issue, number one, do you think this is here to stay? You think it’s going to happen more and more. And then over in the UK, are you also starting to see some of this as well?

Guy

 Let’s a good question now I take it that you and Matt on different sides of the Trump camp. Is that right? 

Tim

No, no, I don’t think we are. Yeah. I am, uh, a left-leaning hippy, uh, you know, dancing in the, in the mountains around naked, around the totem pole.

Guy

 I like it. I’d like to see that. Um, the, you wouldn’t think well, only for amusement. I mean I need to learn something new. Like I, I’m always wanting to learn things. Um, the, okay. So, okay, so Britain, okay. If that’s the way you are going and we can be a little bit polarizing here, then obviously my intellectual side and my side of reasoning just see him as a bit of a buffoon. Um, as we all pretty much do in the UK. Um, in that, you know, he just comes and says nonsense a lot of the time and, and then lies about what he said the day before. And this is why I have slight issues about what might’ve happened 2000 years ago because we can’t even agree on a video clip that we can all see and what someone said. So how on earth can we agree on what someone reputedly said with no records other than word of mouth two, three, 4,000 years ago? So I have some, you know, some, uh, issues with all those things. It’s, um, my biggest beef with China is really one of the ways they treat animals. I love animals. I’m an animal lover. I am revolted by what they do and how they treat their lead. Like in some medieval, uh

Tim

we’ve tried to close those wet markets, don’t we? I mean the internet is, it is something about that international scandal,

Guy

but they are allowed to happen. They are a rich country now China, they have every means available to them to stop that nonsense. Um, now where it comes from, whether it’s from a lab, I mean no one’s suggesting they did it on purpose. I think that’s what’s interesting about what’s come out of Pompeo and Trump. This nonce compare actually did say he didn’t think it was done on purpose, but clearly they have a culture and um, a sort of way of treating animals. That is to my utterly barbaric and then someone has to do something about it. Now, does that mean that you’re going to close the supply lines? I think the pragmatism will not allow that because there’s the big I word that will inevitably happen if you take too much of all that back in the house and that is inflation and inflation will be ruined us to the US and the UK and most of the EU, all highly leveraged economies. So what on the one hand, yes you can say, Oh, but they’ll inflate their way out of the debt, but in order to inflate their way out of the debt, then they might raise interest rates, would be catastrophic for the vast majority of the middle class who are highly leveraged in their properties. Because don’t forget in the last 11 years you’ve had an asset inflationary bubble. Yeah. You’ve had an asset back level rather than, and so people have to pay more for their homes and this and that. So that is to my mind probably going to be more in the realms of rhetoric because to shut that supply line down.

Tim

 Do you think they’re just huffing and puffing right now?

Guy

 For whatever reason, you don’t think that there is because I think that bringing everything in house will be ruined us. Um, it would be literally people, you know.

Tim

So you’re, you’re, I mean you are a very, uh, you think through this stuff logically, obviously critical reasoning and all that kind of stuff. I think emotionally about what you just said a minute ago though, don’t you think we have the risk of emotions running hot and high right now and people even on both sides on any side of this issue, China, the U S uh, Europe. I even read some rhetoric out of Germany where Angela Merkel was talking about China as well, that you might see tariffs, you might see an international action. And what does that, do you think that could derail stock volatility and throw us into another tailspin?

Guy

It could. Well, do I mean it could, well do I think that at the end of the day, some sort of pragmatism will end up winning the day because I think that the central banks and the reserve, the federal reserve stuff do have an awful lot of say and they will tell the politicians, look, do you realize if this happens, you’re screwed and you won’t get elected. So there’s a very tricky balance in this year where Trump and the Republicans are desperate to be reelected. They do have a free hit cause they don’t have a particularly brilliant, uh, opponent. I think if they had an Obama type of opponent, I think they get beaten. Uh, but with Biden, it’s very difficult to predict because he’s a very likable guy. Um, but there is enough doubt about him, in several ways. Uh, there has an age, his mental state, his past, while I think, I think the past where the sexual whatever, well, you know, Trump’s got plenty of that too. So maybe let’s take that out of the equation. But there’s enough doubt being sewn. It’s a bit like John Kerry years ago, he was somehow the Republicans managed to make him out to be the coward. And yet he was the one who got, who was brave in Vietnam. So I, how they spun that I really just couldn’t understand. And the reason I’m interested in us politics, by the way, um, isn’t it for two reasons? Well, one, my first wife was American, so I’ve always, and my cousins in New York, Americans, I’ve got a lot of American influence with me and I’m a family there and next family and this and that. Secondly, um, obviously I trade the US market. So obviously I’m deeply ingrained in, in all things you S apart from your sports, but that’s another conversation. Um, and then, uh, and then thirdly, because there’s always been this high possibility that I would move over there because my business is over there.

Tim

 you’re published in New York, right?

Guy

 Yeah, of course. All that. Well, I only deal with our markets. I don’t, everyone says, yeah if anyone asks me about UK markets, I have no clue. I don’t know. There’s not the options market to do that. So, so the um, I’m very, I’m so interested in the U S I admire the US so much because here’s the thing, you are an incredible economy and one of the reasons is that to really succeed in America, everyone does have that opportunity, but you have to hustle. And that’s the difference between that and a lot of different economies in that there’s not as much opportunity regardless of your background to hustle and really make it to a massive degree. Now, one of the reasons why you don’t have that in the UK is because we just don’t have the population you have. You’ve got, you know, what, you got like six, seven, eight times the population that we have. So one can be fairly remote in Oklahoma and yet still be a multimillionaire because you have captured that niche in that, in that, in that state or in that little bit of, in that County if you like. And we just don’t have enough people over here to be able to compete with that. And that’s the same in many countries. You are a very big country, but you’ve just got this ability to innovate, especially on West coast and East coast, financially and technologically and in all kinds of other ways that regardless of what happens from here, the U S will still be a leader because you have the entrepreneurial spirit ingrained in you. Um, and if you’re looking to make money in the markets, you don’t need to go look around. The US will always provide those opportunities. So, yes, this is going to be a tough time. But you know, longterm would I bet against the U S absolutely not. Um, I would bet right, right with you because you’ll find a way you always have done. You always will do. Um, unless you really get an Idiocracy, but we’re a few generations that might become. Well, well you’ve got your on the way, but we’re a few generations from maturity or Chrissy because you do have some incredible minds over there. Um, and, and innovation and tech and all those kinds of things. Of course,

Tim

 by the way, this is exactly what Warren Buffet said is here shareholding meeting over the weekend longterm. Uh, the U S spirit is going to try out. There’s no doubt about it. But he also has not bought into any new here in the last,a little bit of this rally cause he doesn’t trust it either. So the short term and the intermediate-term, we don’t know. Here’s my last question is, by the way, you bring up our politics. One of my favorite things about lockdown and quarantine is I haven’t had to talk presidential politics. Nobody cares. So you just like ruined my day now. Now I got to think about the election.

Guy

 Now you gotta think about the companies doing the STD medicines, right?

Tim

 That’s right. We got, I’m going to go do some research. Don’t do that TD watch list. Exactly. Make me the new thing.

Guy

 Like you know, which comes with like a, what do you call it? It’s somewhat, someone actually called it on a, on a group I’m on in Facebook. They go, Oh yeah, which ones do the stingy pee stuff, you know? Oh, make you laugh. I D 

Tim

I’m going to make you make a call here. Uh, you know, the S and P right now, 2,800. We hit a low at two 2200. Do you think this market in the next 12 months or whatever window tests that low again,

Guy

it was just below 2200, which made my call of 2100 almost right, by the way. Um, just being pedantic. Um, I think there’s a high chance of that. Yes. Yeah. I really, I, I logic dictates that the thing that would sort of scupper that is because so much of the index is weighted towards such high-quality companies. Apple, Google, Microsoft, Facebook, which, which are equipped to weather the storm better than any others. That’s the only thing that could sort of slightly scupper it, but then go down to the IWM and stuff like that. It’s very difficult to see, you know, once the market, here’s the big question, here’s the big word that you’ve got to really pay attention to. And that’s liquidity because we’re going to find in late summer, by late summer, maybe it’s the July, August earning season or into the end of the fall. Is that just, where’s the liquidity gonna come from? Where are the customers? And it all feels so right now we’re in this kind of like tub-thumping. We’re going to get through this American spirit, English spirit, everyone’s a good spirit. But there is a reality dawning that there are industries that hurt that are literally on life support and the customers are not going to come back immediately. That’s the problem. Eventually, we’ll get there. But right now, this year, you know, every week we have in lockdown or virtual lockdown has a longer consequence than just the week it’s down and we haven’t read it. And the markets have been um, uh, delusional about that

Tim

at lower levels. Would you be interested in longer-term holdings, you know, buying into these deeper pullbacks? Yes, absolutely. Really.

Guy

I mean, you know, I’m always interested in, in certain situations for longer-term, but if I get, but I could get stopped out at the same time. So you know, I am more um, you know, let’s just say you’ve got a world-class company like an Apple, Microsoft, Microsoft, so well equipped this kind of situation. So long term, if you get a big dip with Microsoft as you did at, but you want to hold it for longterm, boy, it’s a great company. It’s, it’s a world leader. It’s going to continue to be weld data cause it’s, well Chris, it’s basically based in the cloud now. They’ve totally since they got rid of, well since Steve bomber left that company changed course and boy, it’s difficult. Yeah. Just incredible. 

Tim

I love your office set up there. Guy. I really enjoyed the interview. I’ve taken enough of your time here today, but as always, my friend entertains me, entertaining, insightful, and enjoyable all the way, uh, people can find you on Twitter I believe your handle is at a GuyCohen

Guy

correct. GuyCohen and we’ll maybe we’ll do something, you know, we can figure out something together and then, uh, do whatever. Um, but yes, it’d be nice to see you guys I think in the past and we’ve had a few bits of correspondence from your people. So it’s always, you know, we always do our best for you. 

Tim

Yeah, no, we uh, you’re always welcome here at training justice in our community guy. We get a lot of positive feedback from the last episode you were on and you know, we appreciate you, man. You’re doing great. Great things out there. Keep up the good work. Okay. 

Guy

We didn’t talk about stinky pee last time. I was, let’s just see what the feedback is. 

Tim

Fair enough. All right guys, we are out. We’ll be right back with our special presentation after this break. P J podcast.

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