A Comment -- General Comments From an Expert (A Commentary)

Copper has held up in this sell-off, though it's down 7.5% YTD. Chinese demand was hit last year during the trade war, but supplies have been adjusting. We won't see oversupply even if there's a drop in demand. Today's 0.5% rate cut from the U.S.: markets are down only 4% from their peak, and gold does well in a low rate environment. All the signs are there for an up move in gold, which should break through $1,700. WTI has shown more sensitivity than any commodity in this downturn. People aren't traveling, so gas usage is down. Though flights and cruises are cheap, but he wouldn't take a cruise now himself.

How are you processing recent trading sessions? Lots of excitement. Market was straight up for a while, and health news caused some concern. Market was looking for an excuse to sell off.

Today's Fed rate cut and subsequent market selloff. Just another data point. From a technical perspective, the selloff is concerning. Each piece of information is added to your analysis. The virus is having an impact, and the Fed is being proactive in case it causes a recession. It was the responsible thing to do and will help the economy. The next quarter or two could be a bit weak. By summer, we should have a better grip of what's going on and we should move forward again.

More people are staying home, but will the US and Canadian consumers continue to spend? Consumer confidence is important, and the Fed cut will help down the road. The bigger question is where will we be at 4 months from now. You have to focus on the value of a stock and where will it be in 12 months, not on what's the stock doing today. That way, you can find some great bargains. A stock is not a bargain if it's down 20% from being up 400% on no earnings.

Today's Fed rate cut a mistake? They're in a difficult position. They have to do what they think is right for the US economy. He's not going to second-guess that decision.

Effect of cryptocurrencies on small businesses? They're way over-hyped. Huge speculative binge. Used by the black market. Blockchain technology behind it is, however, very interesting.

What will it take to stop the bleeding? So many things driving the market. Tech drove the US market more than Canada last year. This is the danger of momentum money. What's been working for the last 5 years could stop working if the quant machines start working against stocks. There are some great opportunities out there with hidden value, but you can't just look at a stock chart.

Market. Market volatility is here for a while. No amount of central bank easing is going to stop this. Wall street is used to the wall street cushion they call the 'Fed Put'. The big deal is how to deal with the economic shock from Corona Virus. To him, this is an end of cycle and the recession will play out. He thinks the path to Bernie Sanders being president is way more likely than the market is pricing in.

ETF for Global Market Giants. There is not exactly that but there is similar. TXF is probably not currency hedged but covers 25 of the TECH giants in the world, with a covered call overlay. You want to participate in large cap tech on a diversified basis. You could by QQQ-T to track the NASDAQ.

Educational Segment. The US Election – Bernie. Trump and Sanders are the same candidate to Larry. Trump went after the idea that it was the immigrants' fault and foreign trade. Sanders is saying that it's Wall Street's fault and corporate greed. They are both asking for the same vote.

Markets. [Brian Cook and Joe Mazumdar guests] They are seeing a lot more money coming into the mining sector but it is very selective. The juniors need a higher gold price. Less people are interested in the juniors right now. They are now seeing solid projects that are oversubscribed. ABX-T is promoting their working with juniors. Larger mining companies recognize that their own production profile is dropping off.

Silver. Silver is a gold bug on meth. Some companies with a high exposure to silver sometimes see a premium. 50% of the demand is industrial, rather than speculative.

Gold's sell-off Friday, why? Some players with margin debt were speculating in gold, or had gold among other assets in leveraged portfolios. When margins calls hit, the sell decision is often made by the credit officer or margin clerk, not the investor. Also, gold is EXTREMELY liquid. Together, this encourages selling. He expects gold to do well if volatility is high--people buy gold out of fear. Also, gold reacts to people's faith in the purchasing power of the US dollar as expressed in the US 10-year treasury which already returns less than inflation.

Market Outlook The market was getting frothy heading into the Coronavirus outbreak. At that time any negative news made the market ripe for correction as it was priced for perfection. As the virus continues to spread, it is creating an outlook the global economy may be shut down for 3-6 months. He can't see now how anyone would have a positive opinion on earnings this year, so this is not unexpected. The Fed Reserve eased three time last year and now a 50 point basis cut is expected by the market over the next couple of quarters. As painful as this feels this week, they have been preparing for pullback and now they are taking advantage of the oversold nature of the market and are back in buying. Gold is expected to pullback to $1580 and if it holds at this Fibonacci level, he thinks that will be bullish for the commodity. This is a great buying opportunity for gold right now.

Market in long term correction? This market move is very different in that a Tweet is not going to solve this. What gets hurt in the market first are the very expensive shares -- trading at high multiples. Going to bonds is not a great strategy right now as inflation outstrips the yields on long term bonds -- you would be guaranteed to lose money. Fixed income is now screaming at capitulation (more risk of falling than continuing to rise).