Trader Called Tech Crash--Now Predicts ‘Black Christmas’ For Stocks | Todd Horwitz

Alphabet

Across the shows: 53 speakers in other episodes, 41 bullish and 33 bearish calls, past 30 days

• Todd "Bubba" Horwitz · BubbaTrading.comBearish

  Google isn't done falling; expects more downside despite last week's big drop.

  Todd says Google's selloff last week is a sign of the broader correction and that Google is not yet done going down. He points to Google's drop as an example of the 40-60% haircut he expects across the market. He still holds Google and says he will not sell it. He hedges the position and does not plan to add to it near-term. Over ten years, he expects it to be worth much more than it is today.

  “I think you saw it with Google last week. I don't think Google is yet done going down.”at 8:35

NVIDIA

Across the shows: 53 speakers in other episodes, 47 bullish and 17 bearish calls, past 30 days

• Todd "Bubba" Horwitz · BubbaTrading.comBullish

  Holding Nvidia through the selloff and buying more; expects it worth much more in ten years.

  Todd says a good company does not justify panic selling, even when its stock falls. He says he will not panic out of Google or Nvidia. He is looking to buy more and hedge the position. His reasoning is that he expects ten years from now to be worth a lot more than today. He admits the market could still fall 30-40% over the next four or five months before that, so he is treating the near-term drop and the long-term view separately.

  “If the company is a good company, even if it's selling off... am I gonna panic out of my Google or my NVIDIA? No. I'm not. I'm looking to buy more and hedge it because I've expected ten years from now to be worth a lot more than this today.”at 18:27

US stock market outlook

• Todd "Bubba" Horwitz · BubbaTrading.com

  Expects a bear-market rally to be sold, then the Nasdaq to fall another 5-8% before year-end.

  Todd sees the market as oversold but expects one large, sellable rally over the next three or four weeks, followed by renewed pressure into year-end. He calls it a possible 'Black Christmas' like 2018. He says the market is in bubble territory, that the cheaper AI stocks are already down 70-80%, and that the market's path of least resistance is now lower after four years of gains. He has resting orders to sell the S&P at 7,620 and is short the market as a trader. He expects the market to fall 30-40% over the next four or five months, while still expecting it to be higher in ten years. He notes last week's selloff had no panic, so there is more room to fall until a capitulation bottom. He hedges his holdings rather than selling them.

  “And I, like I said, I expect a bear market rally, and I expect the market then to continue to selling. And I certainly expect the Nasdaq to lose another five to 8% before the year is over.”at 14:14

• Todd "Bubba" Horwitz · BubbaTrading.com

  Risk-on/risk-off sector rotation is a hoax pushed by advisers; hedging beats rotating.

  Todd argues that the risk-on, risk-off rotation trade is the biggest hoax in history. He says if you can hedge your own holdings, there is no need to rotate between sectors. He says rotation is how financial advisers keep clients invested so they keep earning commissions. He says no one can time the market, and that people who try to rotate end up making less than those who stay put. He says he does not rotate and only observes what is happening.

  “I think the risk on risk off trade rotation is the biggest hoax there is in history.”at 21:13

• Todd "Bubba" Horwitz · BubbaTrading.com

  The US market rally has no basis in forward P/E history and must eventually fall.

  Horwitz argues the stock market rally is being artificially maintained and has no justification given forward P/E ratios relative to history. He cites the Shiller index being at its highest level ever and says the market's P/E is at a level that cannot be sustained. In his view a correction is inevitable: the fall will hurt some people, but a smart investor can treat it as an opportunity. He says he is always net long in his long-term portfolio, so his bearishness is about the broad market rather than a trading position. No timeframe is given.

  “Trying to artificially continue to maintain a stock market rally, which has no business based on forward PE ratios going back in history.”at 35:59

US growth & recession risk

• Todd "Bubba" Horwitz · BubbaTrading.com

  Government economic statistics are unreliable; ISM surveys are the only trustworthy numbers.

  Todd says government numbers are not truthful and the reported 3.4% growth figure is not credible. He says inflation is much higher than the reported rate. He says the jobs numbers are BS and always get revised in later months. He trusts only the private ISM manufacturing and services surveys, which he argues have no government influence and so reflect reality. He says people worrying about the official figures are worried for no reason, though some may panic.

  “The government numbers are all manure... Whatever the government reports is ridiculous. There's no way that we're only at a 3.4% inflation rate.”at 17:08

• Todd "Bubba" Horwitz · BubbaTrading.com

  US is already in recession; warning signs will play out sooner rather than later.

  Todd says the US is still in a recession despite the official growth figures. He argues the upper end of the K-shaped economy is doing fine. The bottom end is struggling with unemployment and high debt. He ties this to rising credit-card, auto and mortgage defaults. He says these warning signs played out in 1987, 2001 and 2008, and will play out again in '26 or '27. He does not want to name an exact date, but says it will happen sooner rather than later because the economic problems cannot be sustained.

  “Yeah. Look. In my opinion, we're still in a recession. ...these warning signs will play out... They're going to play out sooner rather than later.”at 19:21

US rates & the Fed

• Todd "Bubba" Horwitz · BubbaTrading.com

  Fed may be forced to cut if real economic trouble emerges despite its hike talk.

  Todd says the Fed keeps talking about hiking, but it may be forced to stop hiking and even cut if there is a real problem in the economy. He thinks that possibility is real. The Fed's decision to stand pat already suggests it is concerned despite high inflation. He also argues that the Fed should keep raising rates until inflation is controlled, because free-market forces require higher rates, and that its cartel-style policies caused the problem. His two views point in different directions depending on the scenario.

  “...the Fed, although is mentioned and continues to say they're going to hike. They may be forced to not hike anymore. In fact, they could be forced to cut if there's truly a real problem to the overall economy”at 23:26

• Todd "Bubba" Horwitz · BubbaTrading.com

  Low interest rates are artificial, inflate markets, and enrich the wealthy while hurting ordinary people.

  Horwitz describes current interest rates as phony and says they are being used to prop up the stock market. In his view the rates do not benefit the average person and only make wealthier people richer. He links this to inequality, warning that a population without broad success can drift toward socialism, which he sees in the current election debate. The argument is mainly about distributional effects, and he gives no specific rate level or timeline.

  “trying to maneuver your way through a phony interest rate that doesn't benefit the little guy that only makes the wealthier wealthy”at 36:27

US elections & politics

• Todd "Bubba" Horwitz · BubbaTrading.com

  Midterm result won't have lasting market impact; expects a knee-jerk move then a sellable rally.

  Todd argues the election outcome will not change the stock market much. He cites 2016, when the market fell limit-down after Trump won and then rallied straight up. He notes midterm seasonality, with markets typically rallying after the cycle ends, and that who holds office historically does not matter much. He expects any election-driven move to be an overreaction, followed by a rally he would sell into. He says positioning by large firms, based on prediction markets or their own information, can move markets around news, and he does not trade the election itself.

  “I don't think that the election's going to have any real effect on the stock market itself. I think history proves that fact that the... That who's in office really does not necessarily matter.”at 4:12

AI & jobs

• Todd "Bubba" Horwitz · BubbaTrading.com

  AI-driven layoffs threaten the workers who fund 401(k)s and the stock market, creating a big problem.

  Todd argues that when companies put people out of work, those workers stop being investors. Microsoft buying out 60,000 employees is only the start, in his view. He says people's earnings drive markets through their 401(k) contributions, so if workers have no jobs, the money to keep the market rising will not come from them. He calls this a big problem for the market.

  “when all these companies put all these people out of work, who are going to be the investors into these companies? ...That is just the start of it. ...People's earnings are a big part of what makes the markets drive.”at 8:56

AI infrastructure & data centers

• Todd "Bubba" Horwitz · BubbaTrading.com

  Hyperscaler buildout runs on government money and loans, with debt outpacing profits.

  Responding to the claim that data centers drove most of Q3 GDP growth, Todd says many hyperscalers are running on government money and loans. He argues that companies are creating debt they cannot cover with profits, which is a sign of trouble. He sees this as where the rubber meets the road. He ties it to his broader view that too much debt is involved and that the buildout cannot be sustained on current earnings.

  “a lot of them are running on government money and loans and and things like that... You've got companies that aren't making enough money to cover the debt that they're creating.”at 13:05

Banks

• Todd "Bubba" Horwitz · BubbaTrading.com

  Banks are over-leveraged and lending against securities again, a warning sign for the economy.

  Todd says the banks are over-leveraged and that the banks are starting to lend money against securities again, which he sees as a warning sign. He ties this to broader debt problems and the risk that destroying workers will also destroy the banks. He treats it as one of many changes pointing to deeper problems in the economy.

  “I think the banks are over leveraged based on the action that you're seeing because now the banks are starting to lend money on securities once again.”at 13:35

Sports, betting & prediction markets

• Todd "Bubba" Horwitz · BubbaTrading.com

  Prediction markets and options signals are unreliable; market makers and arbitrage distort them.

  Todd argues that prediction-market odds should not be read as a clean signal of what the market thinks. He points out that market makers are involved, and that traders can arbitrage between prediction markets and futures. He says he can make a prediction market lower while buying futures on the other side. He warns that people who look at high options volume or prediction markets for a signal miss what is on the other side of the trade.

  “remember, there's market makers involved there... what we don't know is what's on the other side of the trade because there's always something on the other side of that trade.”at 14:55

Earnings & corporate profits

• Todd "Bubba" Horwitz · BubbaTrading.com

  Companies aren't making enough money; earnings okay but not meeting expectations.

  Todd argues that companies' earnings have been okay but not great, and that they are not meeting expectations. He says companies are not making enough money. He returns to this point repeatedly, calling it the core test of whether a company is worth owning. He says the answer for the AI companies is not yet, and that Warren Buffett made the same point about companies that do not make money during the internet bubble.

  “Although earnings have been okay, they haven't been great. I don't think they're meeting expectations. I think companies aren't making enough money.”at 15:53

US consumer

• Todd "Bubba" Horwitz · BubbaTrading.com

  Lower-income US consumers are struggling with rising delinquencies, a sign of coming trouble.

  Todd argues the upper end of the K-shaped economy is having the time of its life, but the bottom end is not working and cannot pay its bills. He cites a claim that 25% of the population is 90 days past due on credit cards. He also cites about 10% defaulting on auto loans and 8% on mortgages. He says mortgage companies are offering 0% down and housing keeps falling, and he treats these as warning signs that are being ignored.

  “The upper end of the K? No recession... But the people on the bottom end of the K are struggling. They're not working. They're not being able to pay their bills.”at 19:21

US Treasuries & yields

• Todd "Bubba" Horwitz · BubbaTrading.com

  Still selling 10-year futures, expecting higher yields; falling yields would signal deeper economic trouble.

  Todd is short 10-year Treasury futures because he thinks interest rates are still going higher. He sees a possible deeper economic problem if yields stay down. He says the Fed keeps saying it will hike, so rates are likely to stay high. He notes the current peak in yields may be a dead-cat bounce in futures, or may signal problems in the economy that have not yet hit the market. His view is that the market is headed lower either way while the yield curve stays as it is.

  “I'm selling ten year futures, okay, which means I think interest rates are still going higher. But if they stay down here, that would indicate to me that there's a lot bigger problem to the economy.”at 22:55

Oil & fuels

• Todd "Bubba" Horwitz · BubbaTrading.com

  Oil heading much lower; short oil and sell rallies; crude about $77 a barrel in a year.

  Todd says oil will keep falling because of an oil glut in the US and the world. He says demand is down, which signals recession, and that China is buying oil at a discount. He says the people are overloaded and trying to sell. Iran headlines do not matter much, and the rallies have been lower highs each time. He is short oil and would sell more at $100. He would not buy today after the $10 drop, but would sell into any rally. He bases the year-ahead target on the futures curve, which is in backwardation. Crude a year from now is priced around $78.78, and he expects it to trade near $77.

  “So look, I think oil is going much lower... I have no problem being short oil... And, again, if I look out, a year from now, it's trading at $77 a barrel.”at 25:44

US inflation

• Todd "Bubba" Horwitz · BubbaTrading.com

  US inflation is going higher, driven by debt-fuelled government spending, oil and beef prices.

  Todd argues inflation is not coming down because oil and beef prices are too high and too many costs are too expensive to reverse. He calls this inflation government-driven and debt-driven rather than demand-driven. He blames government spending too much money and says the economy is now in a hole. He says the official numbers understate inflation, which is much higher than reported. He wants inflation brought under control, and says higher interest rates are the free-market answer to it.

  “Inflation is going higher. They can't get it down, especially with oil at the price where it's at, especially with beef with the price where it's at.”at 29:24

Gold & precious metals

• Todd "Bubba" Horwitz · BubbaTrading.com

  Buying gold below $4,000 for the long term; expects new highs toward $5,500 eventually.

  Todd says he is buying gold and physical metals at $3,900 and storing them. He thinks gold may hold here, though $3,600 is possible. He attributes part of the recent drop to investors selling gold and gold stocks to meet margin calls on equity losses. He says gold will go back to $5,500 and make new highs, though not necessarily soon. He would scale in, buying $2,500 at a time at lower or higher prices, because he is playing it for the long term. He says silver is down almost 70% from its highs and is also a great buy. He warns that investors should only buy with money they can afford to hold, not borrowed funds.

  “I wouldn't mind scaling in to the gold market because, again, I'm not playing it for today. I'm playing this for the long, excuse me, for the long term, which I expect fully that gold will go back to 5,500.”at 32:11