2026-09-10 - The Long Hill Report - Guest Mike Carnevale

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1:11Good afternoon ladies and gentlemen.

1:14Welcome to the lungful report conversations with I am here with Mike Carnival

1:23and I am Richard Morco and we are glad you are here and if you enjoy today's broadcast

1:32uh please um like and subscribe on YouTube if you can.

1:38Uh it's once again been another interesting month. Not as crazy as some

1:44others, but crazy. Uh we do we are looking at yield surge. Gas is going up.

1:53It's over five. Um in some spots, not just right here. Do you Does Mike think the Fed is going to raise the rate?

2:04I bet you they're going to. it it looks like they really really don't have much

2:10choice. Now we are seeing we we as a people are being bribed or the president

2:19of the United States is talking about bribing us when he's going to give us all 5,000 what were the parameters?

2:28$5,000 for every US citizen. every US citizen if the if the Republicans keep the House and Senate.

2:37Um, so bribery is in season, but then again, hasn't it always they always

2:45promise us this? Now, President Trump has been known to make a few promises.

2:53Uh, Mike, you want to go over a list of the ones he's kept? I just finished.

3:01There you go, ladies and gentlemen.

3:04I'm still waiting for my Doge check and my tariff rebate check I was supposed to be coming.

3:10This is a patient man. He's a patient man.

3:14Maybe they're going to lump all three together in just one big check.

3:18Why not? Yeah, I think that's reasonable.

3:21And um he's p Mike is patient and he's trusting. [laughter] What?

3:30Little different.

3:31Well, I wouldn't believe anything I heard now.

3:35Yeah, I was a trusting soul.

3:40So, um, anything else big in the news other than the great financial stuff?

3:47Well, I think it's, you know, it's been more of the same, right? You got the stock market continues to do well.

3:56uh oil prices and food prices continue to go up.

4:02Uh we continue to get stuff from the administration that I think we're surprised at what we hear. So in a sense really no nothing's really changed.

4:12One thing I'm going to bring up because we made a career for a couple of years here and you might probably did it

4:20before that with um Dick of talking about unbelievably brutal

4:29um increases in rates from the Turkish um central bank.

4:37It's turned around. I Yeah, the Turkey is the big guy.

4:42Yeah, they're they're they're moving out sharply.

4:45Uh at at the NATO um summit held in Turkey in in Ankara, they uh they were basic leaders of the pack.

4:57Mhm. Now Turkey, big important country, unbelievable

5:05defense um sector is an enemy is our ally, but they're an

5:13enemy of another ally, Israel.

5:19So, um that is, you know, we have we have two allies and they're enemies of each other. How does that make sense?

5:28It doesn't. But a lot of stuff doesn't make sense.

5:32So, um, anyway, enough fun in the international uh world.

5:38Well, I can't I can't before you end that. I I do have to say, you know, things change, right? You know, wait a minute, let me write that.

5:48Yes. Things T H I N G. Don't forget the S. Okay.

5:52Change. C H A C H A N G H E Okay, got it. Thanks.

6:00You know, everybody didn't Nobody liked turkey. Uh now they like turkey, but they don't like chicken.

6:09So things change.

6:12It's the temperature in here, by the way, that we have no AC. Uh you hurt yourself.

6:16I know. I feel it. Hopefully I'll recover. Although this time I'm not so sure. [laughter]

6:24So, um, the doctors will be by for Mike any minute now. They're bringing the nest.

6:31Yes. Yeah. Yeah. [laughter] Uh, but no, I mean, the market continues to do surprisingly well.

6:41And I beat you up with this all the time, right? What do I always say?

6:45Uh, it's inflation. That's No. Do I say that?

6:49You do. And I've my answer is well it's half that.

6:54You know it's half inflation and half actual growth. But we're starting to see and we didn't see it in the numbers

7:03through the end of August. But now that we're into September, we're starting to see some signs, right?

7:10Oil has really gone up quite a bit. Uh the latest inflation numbers which came out today

7:17are up which leads to thinking that the Fed's going to raise rates when they meet the middle of September.

7:25So things are starting to change now I think really.

7:30And September historically is the worst month of the 12 for for stocks. So we're

7:36kind of in a tough spot. Well, I don't know too much about Mr. Walsh.

7:44What I what little I've heard is he's not detached from reality, right?

7:50But he was appointed by somebody

7:52[snorts]

7:54who there is speculation might be detached from reality. Mhm.

8:01So one would reasonably expect in the current situation

8:09if you believe in C that central banking is a worthwhile institution and you wanted to not disgrace it completely

8:18have a a rate who might not prefer a rate increase.

8:24I would I would probably say the president.

8:26Do you think he has enough juice with Mr. Wash to put a put the kaibos on there.

8:32I don't think so because if it was just Kevin Walsh making the decision. Okay, maybe. But

8:40there's 11 other people who are going to be voting and he certainly doesn't have he doesn't have that much.

8:47He doesn't have the sway with at least three of them.

8:50You know, Powell obviously um the guy from the Federal Reserve Bank of Minneapolis, he doesn't have him. And um who's the the one in San Francisco?

9:02So, you know, you figure you got three voting for hikes, you only need three more.

9:13So, it'll be interesting to see if they do raise interest rates and the futures market is saying they are going to raise

9:21rates in the middle of this month, middle of September. It'll be interesting to see what the reaction will be, you know. Well, if they don't

9:29if they if they say they lowered them or if they just if they stay the same, they might get away with something, I think.

9:38But if they actually lowered them, the screaming and yelling in the nashing of teeth uh would be uh brutal.

9:47Yeah, there's no chance that they'll cut rates. Uh the odds right now are around 70% that they will raise them.

9:55Um and you you know you probably have to right because inflation is going starting to the rate is starting to

10:02increase again. Oil today is well over $100. So you have to do something to

10:09well the the oil I think it's kind of a little bit an independent thing in that um a lot of that some of that is determined on another continent.

10:21Right. Yeah. So, uh, um, that I think that's going to go up no matter what. If if if they raise the rates, if they

10:29brought inflation to zero, supply and demand is a different thing there.

10:36Yeah. I mean, um, and supposedly all the positive stuff

10:44that has happened has not translated to bringing down any of those numbers. So, whoa, whoa, what positive?

10:55Well, I think the Venezuela situation is positive.

10:58Oh, you know, I I have to think about that for, you know, it was piracy. Oh, yeah.

11:06It was criminal. Yeah. Yes.

11:08Um and it was actually a blow against China just as much as it was a lot of it.

11:15Uh so but yeah, you you know um you could steal something and say, "Hey,

11:22that was good." And maybe technically it may turn out that way, but I don't feel good about it.

11:30No, no, no. But I mean it's um And did it and has it ated. No, nothing.

11:36So, so there it is. It's a good thing, but it hasn't really worked.

11:40Well, will it work? It's a good headline.

11:43And I think, you know, some uh uh analysts who follow the the oil industry

11:50say uh yeah, basically the V Venezuelan uh production side is it's worth

11:57nothing. It all has to be remade because they've done nothing in 10 years. So most well a lot of analysts

12:05have said it could be five years before we know whether this is going to work in our favor or not.

12:14Okay. So that maybe it wasn't headline sounds good but it's not going to have most a lot of analysts say it's

12:21not going to have an immediate effect on the price of of oil.

12:27And you know there's been a lot of stuff like that right going on. And it's sort of like

12:37each time it's sort of like each time you try to do somebody tries to do something that

12:44doesn't work, they then have they follow that up with something even more bizarre to try to make that work. I think that's

12:52what we're in. Feels like we're in that area now. In other words, uh you know, the Venezuela thing didn't work out. uh

13:00we don't have Cuba, we don't have Greenland, Canada doesn't seem to be cooperating with us. So now I'm going to give everybody $5,000. It's sort of like

13:09it's more and more desperate things and you know, geez, you hope he doesn't, you know, you hope the ultimate desperate

13:17thing doesn't happen where he launches a new, right?

13:21Well, you know, I believe you're going to say, hey, these are Republicans are back mega Republican. I blame the Democrats.

13:30Oh. Oh, abs. Oh, they're both to blame. Both sides.

13:32Well, why I blame the Democrats is uh it's like um the crazy uncle comes down to dinner, throws up all the over the

13:42kitchen table to and uh some people just pretend it doesn't happen, right?

13:48Well, they're not pretending that it that Trump is bad. They'll say Trump is bad. What they should be saying is

13:56impeachment. They impeached him twice for something Mueller basically came out and said no nothing here and they impeached him twice and now

14:04me mouthed um but uh we're in Massachusetts here.

14:11Yes, I watched um I don't watch too much TV, but I saw a uh commercial for Ed Maki. Okay.

14:22Who's a dim bulb of all dim bulbs? And there's all the Democrats saying Ed Marky is a god.

14:32He's a fighter.

14:33Ed Marky makes God look like a Yeah.

14:36That's basically the way they were talking. Yeah.

14:39You know, so there there's Liza down in Washington. There's uh Oenclaus. There's who are the other Well, you have Neil in the western part of the state.

14:49you have uh I will say McGovern has put out some

14:54good YouTube videos. Uh it's u you know he's he's on the Senate. He's on the

15:02House floor. There's probably nobody in the room when he's doing this, but I they've been kind of entertaining.

15:08Um say the impeachment word. Yeah. Say um hey cabinet 25th amendment.

15:17Yeah. Come on. The guys on interplanetary travel without leaving the ground.

15:22Unfortunately, the cabinet is as screwy as the uh Yeah, that that's true. But at least at least you're shame. You know what

15:30they say, the nuns used to say, you must go tell the truth and shame the devil. Yeah. Yeah.

15:36Telling the truth is not a Congress a Congress. No. thing to do.

15:43No. No.

15:45And you know, you know, we got a couple of months to to see whether this is going to stop or it's going to

15:53be much worse. I'm not convinced, you know.

15:57Well, what do you Let's get some odds here. Let's call what is it? Poly market or one of those betting things. Well, I think I think it'll be a

16:07a big loss for the administration, but I'm not willing to bet any of my own money on it.

16:14You know, if it were just my neighbor and I say, "Well, I'll take uh I'll take the Democrats uh the Republicans

16:22winning. I'd take the Democrats winning, but I would never go to one of those markets, you know." Right.

16:28Right. Um, so it's it's it's but it's getting it's getting worse and

16:37worse as you say. It's like the the person you know who's he's kind of losing it, huh? Oh jeez, I didn't notice. And then you see three months

16:45later she's and you say, you know, you're right. He's really bad. You're seeing it in real time in real time every day and nobody's saying anything.

16:56I mean, it's and now they've got the Republican midterm convention

17:05and you know, um, you know, we have cameras here, right?

17:11With cameras, you can aim them certain ways that show a monster crowd or that can show there's nobody there. And it's basically nobody there, right?

17:23Oh, who would model, right? I mean, you know, free tickets, come on. Um,

17:30and you know, it's sort of like he spoke, the president spoke last night for an hour and 45 minutes. That's

17:38something you see in Russia or did you listen to that?

17:41No, but I did uh, you know, at work today we we have CNBC coming through, so they were playing bits and pieces of it.

17:50You know, it's sort of like, you know, more of the same, right? You know, I was the smartest this one. You know, you

17:58know, the doctor said, "Sir, sir, we've never seen a person more healthier than you." You know, it's all this nonsense.

18:05I haven't seen him saying they're almost ready to canonize me because I'm so humble.

18:11No, that one I've never seen.

18:13Well, I there will be a statue erected, I'm sure.

18:17You know, there hasn't been one already. Uh, not that we know of, but he's too busy with the ark and and the ballroom.

18:25I mean, it's really, you know, he chopped down all the weeping willow trees in front of the uh Kennedy Center

18:33because he because why? Because they didn't allow him to keep his name there.

18:36It's this is really it's beneath I don't care, you know, if you're a Democrat, Republican, independent, it's beneath

18:44the position to be doing stuff like this really. But that's kind of where it's kind of scary. That's where we are right

18:52now. Meanwhile, oh, by the way, yeah, the stock market went up in August.

18:58So, I'm I'm not going to say as I usually do. Wasn't that mostly inflation? Half.

19:04And you're not going to say, as you usually do, half of it. That's correct. That's correct.

19:09Okay. August ranked 10th of 12 for performance. Usually not a good month. Last two have been positive.

19:17Yeah. make it three in a row as two 2026 was up 1.3%. Yeah. For the months. Mike is celebrating.

19:26Yeah. All right.

19:28But it's but it's starting to lose some steam because August had three alltime Yes. August had three all-time highs in

19:36the down, but they all happened in the first week of August. So, I think we're starting to lose some Okay. some of the steam, but it did get over 50 54,000 for the first time.

19:484,000 devalued dollars. Yeah, why not?

19:52We have a little bit of a I hear you. I hear you.

19:55Bonds, rates fell. The 30-year fell a little bit. Uh 13-week kind of stayed about

20:03where it is and the yield curve fell a bit. Um, but that doesn't really matter now because those numbers have all

20:10changed, you know, in the last uh couple of weeks. But as I said earlier, we're entering in September, which historically is the worst month of the year.

20:19I I can see that it's my birth month. So, yeah, I did my best.

20:25You tried to make that hard. Uh, but the last two have been positive.

20:30So, uh, as we start September now, we have a way to go because we're down, you know, about a thousand points from the

20:38end of the month. So, a little more than a thousand.

20:41What do you think will happen if we do have the rates go up?

20:45Well, it's interesting. You know, the market has really dropped has dropped since uh the end of August. Uh, I think

20:53there's some fear that the Fed won't do anything about

21:00inflation. So, if they do raise interest rates, I wouldn't be surprised if the market goes up.

21:07I think if they if they don't raise rates, I think it's going to be more of what we've seen recently, a slow decline.

21:15Okay. Um there's no doubt that inflation speed is picking up again and a lot of that is

21:23energy. Now you got diesel of course and now we're into the home heating oil season. So this all is not,

21:31you know, not not going to be a great picture if if you can't, you know, bring down the rate of inflation.

21:43From a personal standpoint, I wish him the best. I wish them the best of luck. I do too. Reality is that which does not go away.

21:51Correct. All right, technicals. Go get them.

21:55They got a little weaker even though the market did increase, but again, we we could be fooled by August. It was

22:05the first week in August and then we slowly lost, but we didn't lose enough to turn the month negative. So the technical indicators did weaken a bit.

22:15Uh short-term moving average stayed about the same. Volatility, the fear index continues to be really

22:22low. That's a negative. Um the stochcastic oscillator is high. That's a negative. And the fear and greed index

22:31is kind of right in the middle. So there there's a lot more room for these numbers to

22:39deteriorate rather than get better. And again, it's all happening within the worst month, you know, of the year.

22:48Uh some countries, central banks are starting to raise interest rates in August. Um South Korea raised their rate

22:58recently. Um to to today the European Central Bank raised their interest rates. Next week

23:06we got the Fed likely to raise odds say in um the Bank of England meets next week. So we might now are looking toward

23:15now central banks around the world cutting rates um excuse me raising rates

23:23that can you know can cut both ways. I for us I think it'll be a good thing because it would

23:31show that they're serious about trying to slow down inflation.

23:36Why wouldn't you think it would be a good thing elsewhere? I mean if if they're suffering inflation too.

23:43Well, some of those aren't their inflation is not as persistent as ours. Okay.

23:50So I think uh you know Europe Europe is kind of behind us as far as growth and

23:57whatnot. So an increase in rates there might not be as positive as they would be for us.

24:05The big thing is the debt. Oh, we don't have any debt. Uh 40 trillion.

24:14And you say, well, what does that really mean?

24:17More than double what it was 10 years ago.

24:21Um I think we should do what uh by Germany and Zimbabwe did. That'll cure everything.

24:31Yeah. Yeah. And the reaction from the administration on that number was, well, we should have the lowest interest rates

24:40in the world. It It's sort of like and and not to pick on on on the guy,

24:47but for somebody who is the smartest person in the room because he's told us he is.

24:56Not in this room, of course. Uh no, not in this room, but in his room. Uh you

25:03know, it's the padded one. Um it's sort of like basic economics.

25:11He doesn't understand if you've got a lot of debt, the last thing you want to do is encourage more debt. And you

25:18encourage more debt by having cheap money, by having low interest rates, right? So you need to do the exact opposite.

25:28to a certain extent. I mean, you go to too far and then you, you know, shut the economy off. But to say we should have

25:35the lowest interest rates in the world, that's like saying they've cut egg prices by 600%.

25:43It doesn't make any sense. And for somebody who says he was the smartest student at Wharton,

25:52that's hard to believe. I think we have to give out of charity.

26:01I think we have to ignore his claims on anything where he's superlative. Just just ignore him. I

26:09mean it's not you know I understand it is whacko but

26:15you know okay Liz everybody impeach the guy or at least bring it up at least you

26:23know go go into the house where it starts and say we want to impeach the man

26:31just so you get on the record that you think this has got to be done. Yeah.

26:35Stop talking about it. you know, we know he's a nut by now.

26:39Yeah, but it's not going to happen.

26:43No, it's not going to happen. Um Oh, I I think the uh the Democrats, let's

26:51salivate now over the midterms, right? And that's dishonest.

26:56Yeah. But and you know, like I I I hear people saying things like and I say, "Yeah, no, that's a plan." Uh, but what's your plan

27:05if it that doesn't happen? In other words, they figure, oh, we're going to sweep the midterms and then we'll Yeah,

27:14that's a strategy. But what's your plan if that doesn't happen? You stay silent for two more years or you just disappear as an opposition.

27:24Well, as as we mentioned earlier, I wouldn't go to poly market, right? But I I I [clears throat]

27:32cannot imagine this administration winning the house. It's something at

27:40least at least one house and quite possibly both. I would agree, but it wouldn't shock me.

27:49That that would it shouldn't shock me.

27:52I'll say it shouldn't shock me, but I would have to say there's no sanity in this country.

27:59No, no, no.

28:00Um, the people who were MAGA and he's betrayed all their promises, including no wars and everything, right?

28:08If they actually go to the polls, you know, that's a test for insanity.

28:14U indeed.

28:20Uh, oil doesn't really matter. It started the month at 85. It ended the month at 83. But, you know, two weeks into September, we're over 100. So, it

28:28doesn't um Yeah. September's a new world. Right. Right. Inflation we know rose.

28:36Uh leading economic indicators were actually positive in July. Um but the two big ones uh consumer expectations

28:45and the um the um um work week both were negative. And

28:54those are the two components that have the most waiting in the index of 10 of 10 components. And why? Because they

29:03make up the bulk of our economy. you know, people working and how do they feel about themselves and the economy in

29:10the way of spending. Both of those keep being negative. So that's uh you know the headline number looks good. Oh

29:18leaning economic positive only the you know and getting better but not the components you want to see get better.

29:28Jobless claims really at record lows. I mean it's hard to explain but that is hard to explain.

29:36It is.

29:37I was hope that's why we invited you here. Yeah.

29:40I guess we I mean it is it has been hovering around the 200,000 mark for weeks now. Um

29:48and today's number came Thursday. They come out on Thursday. Today's number was 206,000. I mean you need at least

29:55historically you needed 250,000 layoffs a week to hurt the economy. I don't know maybe that number doesn't isn't isn't um

30:04isn't as high anymore because it certainly hasn't helped.

30:09The another reason why there's some talk about higher interest rates is the employment report came out uh for the month of July and um

30:18a lot more 162,000 new non-farm payroll jobs were created.

30:24Historically, you need 150,000 to grow the economy. Unemployment fell.

30:31So, um, that would lead you to believe that, well, the economy isn't in that bad a

30:38shape, so you're going to have to, how do you slow it down? One of the ways is to raise interest rates. But the interesting thing on that employment

30:46report is that of the 162,000 jobs that we created, I believe it was 95% were women.

30:57So, what are they doing? I don't know what that means. Okay.

31:02But it was the vast majority of new jobs that were

31:07created in um in um July were uh women in the workforce. I don't know what that means.

31:17Uh well, it's probably it's not lumberjacks, right?

31:22And it's probably not minors or manufacturing.

31:26some lot of there's a lot of light manufacturing that existed in this country that was mostly women. Okay.

31:35Um, one of the sectors that lost jobs was education. So, you would think the education field is probably

31:42Well, I saw I saw a a little show, YouTube or something. This guy goes to a

31:51beach and he's asking people questions like, um, who was the first president of the United States? And they're all

32:00getting wrong. Uh, what's 100 divided by 20? Nobody can answer it. Now, it's often, you know, uh I haven't been to

32:09the beach all summer, so I know that guy didn't come up to me, but um it's also possible that he

32:15selected his um uh his audience and well, he edited out the people who got it right.

32:25But watching that, I'm saying shut down the schools. Yeah. It's a waste of money.

32:31Yeah. No, it's it's shocking in a lot of ways.

32:41That's what we've become.

32:44Well, I I think I told you that I I don't know if I was telling you I was listening to the Chinese fellow. Yes.

32:51And another Chinese fellow, an American.

32:54None of them said, you know, things such as I was like, you know, perfect English,

33:01right? brilliantly perfect English. Uh, eloquence. And now we know what we're up against.

33:10No ums and a um um um they didn't watch this. [laughter] Okay.

33:19It was just fluent. Yeah. Fluency.

33:22Um and uh we don't see that as we like don't see that as like much anymore.

33:30Um, I understand.

33:33Ladies and gentlemen, again, we ask you to if you if you were not completely offended today, please hit like and subscribe.

33:42Don't forget to hype.

33:44That's the new one. I guess I say um and please like and subscribe and um

33:53we should Michael Carnival and Richard Morco, we should be back again next month. is an economy. If we think if

34:02nothing [music] if not if it hasn't gone completely away [music] and there is an economy, we hope to be back.

34:10I think we'll be able to stay ahead of AI at least for another month.

34:13It's going to [music] be tough. It's going to be hard. It's going to be race. Don't fall.

34:19Thank you, Michael. Thank you, ladies and gentlemen.

34:22[music]