Lynette Zang: Big reset coming Buy gold and silver now? Time to buy bitcoin? Will your cash and stocks be worth anything? Be prepared! david moadel welcome to looking at the markets with David Modell today's special guest is Miss Linnet Zang a popular financial youtuber as well as the chief market analyst at ITM trading covering a wide range of topics including price action bonds yield curve precious metals and hedging Thank You mrs

Zhang for joining me today on looking at the markets it's my pleasure to be here David it's a lot of fun doing this well I really appreciate it and you just came off an intense Greg hunter interview so I think this may be a little more relaxing for you I hope yeah I know he's great so let's start at the beginning if that's okay how did you first get involved in finance and specifically in the commodities markets oh that was an interesting question actually I started when I was 10 because my uncle was a major dealer back east and he dealt in high-end antiques and in gold so he was my favorite uncle I spent a lot of time with him he would give me books as I was growing up for my birthday and he really taught me what it looks like in the physical market and plus what really made an impression on me and it's so interesting because you never really realized this until you have some hindsight I remember going over to his house with my parents and he had these safes in this back room and he'd opened them up and you couldn't even fit one more gold coin in there and that was 1964 when it was illegal to hold more than five ounces of gold and he told my parents if anything should happen to me and birdie is well taken care of for the rest of her life because of this gold so that made I wish it actually made a bigger impression on me and I really understood it more but I was 10 at the time so that's actually what started that and then my father was it was a small town I was raised in Kingston New York and he was kind of a bigger fish in a little town and he was a developer so I actually started in commercial banking when I was fifteen study business finance went to stayed in commercial banking till 86 then went over and became a stockbroker with Shearson in in 86 and in that capacity I would say that I've I know people refer to gold and silver as commodities and they're certainly a part of their intrinsic value that are commodities but my studies really are around money and I started that in 87 is when I started studying currencies and money that's when I discovered they have a life cycle and here we are you know I came here in 2002 built all the databases to track everything but I was always attracted to understanding this so yeah what a foundation to have and some people some interesting characters and you're in your backstory there sure sure now let's get into precious metals how could we not I've heard you reference a reset to eighty nine hundred dollars an ounce for gold and six hundred dollars an ounce for silver how do the concepts of nominal confusion and perception management impact the way we value these precious metals I am so glad you asked me that question because you know understand that the primary function of money to begin with they needed a tool to hold your wealth and your your work your labor even overtime so for example if I'm a farmer which I am these days and I grow this huge field of corn and I spend a lot of time and energy there well if I if my family and I consume all that we can there's nothing we need from a neighbor then I needed a way if I had more crops in the field – I didn't want it just to go to waste so I needed a way to hold it until down the road when I needed it so many many things have been tried over the years but only gold actually meets every criteria to be a good money and it is labor base so it takes labour to pull gold out of the ground and it was a very fair way to value labour for labour but for the government they wanted to tax and spend more so holding your wealthy even was really not on their agenda so in this case in 1913 they legalized the Federal Reserve and we began the transition from a good money savings based labour based standard to a fiat now Fiat actually means by decree so this is legalized government money and its most important function is inflation which guarantees that you can't buy the same amount of goods for the same amount of money in the future now since that's the the primary premise there were two areas two entities that really benefited by it for the government they allowed an inflation tax on your work and your wealth and even if nominally and I'll come to that in a second but even if nominally your salary went up then they get to tax you more on that inflation and you cooperate because you don't understand inflation that's the nominal confusion part so for governments it was great they got to tax you more and you cooperated for corporations they actually wanted you to work for less but they knew if you were willing if you were used to getting 10 bucks an hour you weren't going to work for five however if they could still give you that 10 bucks but it only spent like fun then they've accomplished that goal so today we have this huge shift in income inequality because everybody knows that salaries never keep pace the average salaries anyway never keep pace with inflation so why don't we realize this okay because nominally if you had a $20 bill 20 years ago and you have it today nominally they're exactly the same they're both $20 but the underlying value and what you can buy with it as you can see is vastly different and we've all experienced it and that's nominal confusion so the stock market going up as the dollar value declines is nominal confusion those stocks and your holdings must rise faster than the real decline in purchasing power or you're behind the 8-ball yeah I mean sure sure I love a prepared guest that is wonderful and those charts really put it into perspective just like you do in your YouTube videos you've got plenty of visuals there and that really an educator myself that really drives the point home we saw the three baskets there you know that used to be full of groceries and now now you're feeling a little hungry in 2007 I mean who doesn't know that yeah right we all know that we live it every day yeah and yet it continues and yet we continue to put up with it for various reasons yeah all right at some point there's nothing left and that's why I said that we are near the end of the cycle yeah because officially this is from the Federal Reserve it's one of my favorite websites Fred anybody can go in and use it but officially there's four cents worth of purchasing power left in the dollar so even assuming that that's accurate and they haven't fudged those numbers the problem that they're having is going below zero right the negative traits that's why they don't like cash that's why you see this global war on cash because there's simply not much purchasing power left in any of the currencies I'm not saying they can't continue to inflate it as long as people have confidence sure they can make that basket of groceries you know go up and up and up and up and up and then say look at how well our GBP is doing but there's a problem if your if your income is not keeping pace with that which it's designed not to yeah so wanted to talk about some ETFs you know I am so tempted today with SLV the silver ETF very popular very liquid plenty of volume and it's heading toward 15 which was a buy price that I was looking at me maybe sell some 15 strike puts I don't know GLD another popular ETF this one represents gold is heading toward 116 per share somehow I get the feeling that you might not be as trusting of these ETFs as I am what's your take on that well I think I'm older than you so anybody that's I'm 62 so anybody that's been around for a while has probably experienced without realizing it that dematerialization of all of the markets and certainly gold and silver are no different so looking at SLV this is a trust if you own where you choose well you never really own anything if it's held in an account anyway but if you think you own SLV all you really own are shares of a trust that is designed to mimic the managed manipulated spot price what people don't see is this now what this is is a relative performance chart spot silver against SLV and you can see that these lines are overlapping and then that's purtz to shift can you see that and now there's a gap right so what that actually is showing you is they sell off their holdings to pay those feeds so you think you're buying silver number one you're buying a sharing trust and number trip – it's a diminishing asset because there are constantly selling off their holdings to pay those fees right and it's the same thing is true with GLD they avoid those fees in the beginning and it's in there it's all in the prospectus so you can read it for yourself so you can see how it overlaps but look at this over time that all it's doing is mimicking that price it is losing value if you don't hold it you don't own it if it's held inside of a brokerage account it's held in street name and you are simply the beneficial owner but they've taught us that paper is good look at how liquid it is because they make a market until they don't make a mark yeah okay that's why you think it looks liquid because at the moment they happen to be supporting that market so if it's a short-term trade that you're looking for if that's kind of your mentality then it is a cheaper way to do that trade for a short period of time because it will mimic spot but if you think that you actually own something that's going to protect you forget about it it's all manipulated and it's just about the fees and the guys that can actually convert those shares into real gold and silver that they presumably and I'm sure they do hold in the vaults is not you it's JP Morgan or Morgan Stanley or any of the Big Kahuna's it's not you and that's what people really need to understand in this environment so we can predict or project in the future that these ETFs will do a poorer and poorer job of tracking the actual spot price of the precious metal yeah and as we can see in the chart right it can it can continue to attract the manipulated spot price is just over time you're paying more for less and less value yeah yeah efficient it's just a trust so it'll probably continue to mimic it because that's what they need you to do so that you feel like you actually own something right but don't ya huh something to think about something for me to think about for sure I wanted to talk about ITM trading dot-com excuse me people should check out ITM trading com the link will be in the description of this YouTube video what services are currently being offered at I TM trading well we're a full-service physical precious metals brokerage house so anything that you do with us we will deliver out to you we are not going to store it and while that might temporarily for some people they go oh my god I have to deal with this physical metal well I Got News for You I would much rather have the physical metal in my possession that I can then choose to protect in any way that I'm comfortable with then give it to the foxes that are already guarding this end house so everything we do here is physical but really what makes us different is our team and our knowledgebase since I've studied currencies since 87 then I I do consider myself an artist and what I see are patterns so over the years I've developed a strategy first for myself based upon those repeatable patterns in both movement and valuation and we talked about the fundamental value we'll talk a little bit more about that in a second but our approach is very consultative so we want to know who you are what you're trying to accomplish all of your goals all of your circumstance what your fixed rate that is property everything we want to really understand you so that the portfolio that we built for you actually supports what you're trying to accomplish and I don't know I'm not saying nobody else does that I just don't no of anybody else that takes that approach and and then beyond that once you are a client of ours we actually have a personal booklet based upon your goals your circumstance and what you've chosen to do so that if god forbid this is not what the intention is but who knows what's going to happen with the grid or what have you you will actually have your own personal booklet so that if you can't get a hold of us you know how to walk through but you've seen the webinars on our YouTube channel you know with its ongoing education it's it's constantly keeping you abreast of where we are in this trend cycle and when you see this what does it really mean for what's happening underneath yeah so that's all of that is how we function keen on education we love educating clients and we help you execute that strategy I can see that I'm looking looking at the website right now I see you can get a free gold kit just for entering your basic information there that's free you've got webinars these are free you serve people with IRAs I see there and you've got some beautiful pictures of gold bullion and silver coins you know all kinds of cool stuff your featured products specials it's it's fantastic so what about what better way is there to get the physical stuff so you don't have to worry about tracking errors and everything we're learning about today yeah yeah and and you know the beauty part too you know I've been here since 2002 and pretty much everybody has been here for a really a long time and we're a really cohesive team and everybody pays attention so you may be sitting here and listening to me but my bet is is if you call up and you talk to one of our team members you're gonna hear a very similar voice and that's you know that's something else because you know this is not a regulated industry other than money laundering part so the person that you're dealing with could have been selling shoes yesterday hmmm interesting perspectives in a couple of recent interviews with Cliff hi and Daniel Amadori I've been told in no uncertain terms that the US dollar will be worthless within our lifetime do you agree with this what do you think so the problem is is that in the current monetary system the money is created from debt but we hit peak debt in 97 and you can see that and what that means is like if let's say you just get out of college and you're living with your parents so you have no debt and you have no responsibilities but you get your first job so you decide that you want to go buy a car but you don't want to save up all the money for it just the down payment so you go and you take on debt you're promising to pay it back tomorrow but you're spending those dollars today so yes taking on debt would be stimulative to your economy okay and so you can see on this graph that it was stimulative I mean here's 1970 when we started this path and you can and these vertical gray bars are official recessions so you can see that in 97 we hit peak debt where the debt would stimulate the economy we've certainly grown a whole lot more debt since then but it hasn't done it now this to me is the most important chart because when we see it like this was cash for clunkers that little blip up when we see this going up in a pervasive way more than just a little blip then that is most likely to be telling you that hyperinflation is here yeah okay because people don't hold on to dollars right now they're holding on to it they're not spending this is worse than it was during the depression in 33 according to the Federal Reserve and you could see does that look like it's stimulated right but how much debt have we grown you know a tremendous amount trillions and trillions and all the leverage so this is when they really started levering out the system so you know that that's why yeah in our lifetime Oh probably with him within five years I think we'll see them reset I could be wrong that's not something I have control of but you know how long can they keep doing this as long as there's confidence yeah yeah kind of scary but this is a wake-up call that I think we need as far as Womble people who are considering getting into equities now well let me phrase it this way if I may hypothetically speaking if your elderly grandparents told you that they were going to invest 60% of their life savings into the S&P 500 maybe SP why the ETF and the other 40% in TLT the bond etf a very popular strategy recommended by lots of investment advisors what would you say to them you know I I have a funny story because uh my mom passed like five years well Wow 2010 so more than five years ago but obviously as a stockbroker and then I managed her portfolio but she had her head up until the day that she died so you were not telling Lillian Zhuang anything that you know she didn't want to do in July of 2009 the dollar against the weighted basket of currencies fell to its lowest level ever now look I didn't know how this was going to unfold but whenever you see a shift in the pattern it means something and seeing the dollar falls with lowest level frankly freaked me out so I recommended to my mom that she shift a lot of what she had in the Mart in fact I told her to get out well she wouldn't listen to me and that's okay that was in July in February she said when would you please look at my statement because some it's gotta be wrong with it and she lost like 20,000 bucks between July and February and of course when I looked at it well what happened after 2007 the whole system started visibly falling apart in March with Bear Stearns going out and then by the following September well that's when Lehman went down we had the Lehman moment and everything crashed so even between July and and February the shift will the shift that wasn't the first shift but that was a significant shift so if anybody wanted to invest in the second most expensive stock market in history or hold their wealth there where the most expensive bond market in history then I'd say you must really like the banks because you're going to give it to her you're not going to have it the lesson I just gained from that is we need to listen to miss Lynette Zang the first time she tells you something well you know I can't control anything but truthfully you you anytime there is a shift in normal behavior even going back take any one of these graphs right normal behavior when they put debt in was that it would be stimulative to the economy well guess what do you see is that what you see happening here and what about here and they keep telling you there's a recovery right so it isn't really me saying it you just need to learn how to pay attention a little bit differently that's what I try and teach you in all of my you know our youtube channel with all the charts on the graph well can you see the pattern can you see the shift yeah cuz if I can help you fish right verses fish for you now you can make independent educated choices regardless of what if anybody especially financial advisors remember I plus one I know yeah I know what they write people need to if they haven't already I don't know who hasn't already but they need to check out your YouTube channel just go to youtube and let sang and see all of the videos that you put out a lot of content and it's consistently high in quality we have not sacrificed quality for quantity or vice versa so that's I think that's great I work all the time I can tell I can tell all the time yeah yeah it's for the benefit of your clients and as well as your your viewers and listeners now I wanted to get onto a hot topic if I'm a crypto currencies I I get emails about that on a daily basis I'll bet you do too probably right about now that seems to happen whenever something goes up a thousand percent five thousand percent suddenly there's a spike in interest imagine that Bitcoin etherium so on and so forth are you bullish on these what's your take well okay here's my take on it first of all I am a hundred percent convinced that that's the direction of the new money standard because once it's in the system then they have you completely they can dictate everything so I am a few feelings around this but one thing that I'd like to bring out is that typically for a central bank when they make a policy decision there's a lag time of whether they or not they know it was effective at 18 months if everything is in crypto then they can push a button and have immediate impact so if they want you to visibly see that your principal is going down and they say this in their cashless society piece that they did I did a webinar on that but they say that once once we get rid of cash there are no limits to how low we can push interest in other words since they have you know once they've used up all the principal now they got or rather the purchasing power now they need to attack principal which is what those negative rates are about so the government's have taken the CFTC and globally have taken a hands-off approach to the development of this article of this area because as you so rightly pointed out when something moves up a thousand percent or a thousand dollars or whatever people notice and since we have been trained to feel comfortable with intangibles inside of the system that is not controlled by us the higher they go the more people try to participate and do participate but at the end of the day you know central banks are not going to give up their money monopoly easily I'm sure in my opinion and according to everything that I've read and so while it seems decentralized at the moment because that's the way they want you to think about it perception management okay and also the nominal confusion because people marry the legal money of the state there will come a point in here when they have that technology and those smart contracts all dialed in where there will be a major crisis and people won't look to be saved and so that's when they have you and Mike that is and I could certainly be wrong about this not within my control but the the cryptocurrency that's named the SDR coin which is controlled by the IMF will not be decentralized and neither will all of your information will be in one central location and they push a button immediate impact how interesting yeah it's given me a lot to think about right now and finally given the anemic GDP growth but nonetheless we have an equities market that refuses to pull back more than a handful of percentage points can we reasonably expect a large drawdown in the near future or is Vic's below 13 the new normal what do you think well all of these markets are absolutely and totally control the beer you go all of the Central Bank global central bank money printing so this is why you see the markets of that nosebleed levels now the reason why you do not see them having the ability to pull back so they've got to keep injecting cash to keep them supported are all of the derivative bets that are underneath that it's not real I know the stock market in nominal terms and bond market have gone up in nominal terms which means you know it just looks like they've gone up with the real growth in these markets since 97 since 96 that's been the growth of derivatives all of that leverage that's the real that's where the real roses come from and their price action is based upon the price action of the underlying whatever it's attached to so it could be stocks or bonds or real estate or other derivatives so if that crypto is that technology the blockchain technology with a smart contract once that is fully functional at the speed and the way that they needed to be that's when they'll need a big crisis and according to the IMF Deutsche Bank is systemically the most dangerous bank on the planet completely globally interconnected well their leverage is like 29 to one according to the financial statement so they can't afford a 4% drop where they are officially insolvent all the derivatives make them them solve it anyway but officially they're insolvent so that's why you see that extraordinarily tight range it would be a Black Swan event maybe North Korea maybe you know something we're not anticipating that would take it out of their control but as long as it's in their control I don't think they're wanting the derivative part it's one plug so it'll stay in a narrow range yeah so I'm not asking you to be a top caller but is there a time frame in which we might anticipate again the reason it's called a black swan or a catalyst is because we don't know it's coming but you know out of all the people have interviewed there there it is there it is there for so many reasons yeah this the volatility on the 10-year Treasury which is the base of every market right oh you know here you go this is when it was only marginally managed because the Federal Reserve is actually been buying Treasuries since 2002 so but we already started going down then but you could see the dashes it was not a volatile market right once 2008 hit we went on life support the system actually died and every single tool that the central bankers had up until that moment all scrapped everything is new and experimental and I even did a web webinar on all of their new experiments paying interest doing all sort of rates you know all of that stuff so this is 2013 which is when they really started manipulating the price well they actually started 2011 in here to manipulate the price of gold hard hard because it almost broke through 2000 so the question is how long can they can you live that this is an EKG how long can this blonde I will be surprised although I've been surprised honestly if they can hold it together through the end of the year it's just there's no given these markets just period it seems like nothing surprises me anymore but you know what we have to be careful in today's environment in today's manipulated environment and today's unstable and richly evaluated to put it charitably equities markets and so we have to look elsewhere and of all the people have interviewed I knew that you'd have not only an answer for me but a chart I I you know I think people everybody learns a little bit differently yeah I've heard that from from a teacher or one of my daughter's when she was in sixth grade and you know that way if I do it visibly and verbally it just makes a whole lot more sense it's easier to grasp because these things are made intentionally I mean they say this if we make it really complicated nobody questions us oh you know I mean these guys are so smart I can't understand that yes you can everybody can yeah so that's my mission ITM trainingcom solid as gold i TM Better Business Bureau accredited 20 years old at least and still going strong lease full service precious metals firm specializing in gold and silver products ranging from bullion to rare gold coins plenty of free resources on the website as well and also get your free gold kit on there why why isn't everybody doing this right now eight eight eight six nine six four six five three or ITM trading com miss Lynette Zang how can people contact you either on social media or elsewhere well if you bear with me I'm not really tweeting yet but I I know that's on my agenda I just have to you know take the time to prioritize it but you can always contact us at that phone number I mean we're all here we're all working together you can you can call me but where you where you hear the hesitancy is I haven't yet figured out how to make a 48 hour day so but when there's a bunch of us here there's 25 of us here and we're all really smart and we all take the time and we all pay attention so you know if you really need me I'm here for you I'll keep doing my work but there's lots of great people here yeah yeah of experience that person our fantastic miss Lynette Zhang thank you so much for joining me today I look looking at the markets you're welcome back anytime thank you so much yeah there's a lot of fun thank you so much you did a great job thank you for watching please like comment and subscribe and I'll see you next time