Here's How We'll Approach Negative Momentum in the Republic

Postcards from the florida republic

An independent and profitable state of mind.

Lansdowne Pub is 1.9 miles from my house.

It’s a local Irish pub with a lot of Boston Red Sox and New England Patriots flair. I proudly wear my Orioles hat or “World’s No. 1 Dad” Buffalo Bills shirt when I go.

They know what’s coming as I swing the door open.

Now that my wife and daughter are gone all day with the car, I’m rocking the golf cart.

So, I crossed the railroad tracks of the Florida Republic, peeled across Old 41, and parked beside the bartender’s classic pickup truck. I will soon buy a car…

It’s not gonna be expensive. I’m thinking an early 1990s Chrysler Sebring with a soft canvas roof and a Jimmy Buffett “Songs You Know By Heart” in the tape deck. $7K at best.

I just need to get to the river to go kayaking…

That’s life in the Florida Republic when momentum goes negative.

Our switch went negative on Thursday of last week.

I’m not worried about the markets until it’s going green.

I’m having fun. Tonight, my daughter and I will have a foam sword fight because… I don’t have any exposure to this uncertainty.

That’s what the Florida Republic is about. When global liquidity (the pursuit of credit) and momentum (the summation of equity flows) goes negative… we… are… out… of… the… way.

I just spent 90 minutes – on air – with members of Flashpoint Elite – explaining the future of financial publishing.

I explained my rules for the future.

Rules of the Republic

1. Put yourself first. Individualism is good. Your wealth-building is good. You cannot save anyone else if you are struggling. This is why you always put your oxygen mask on first on a plane.
2. Embrace Self-Discovery: Discovering your passions and strengths allows you to pursue a fulfilling life on your own terms. When momentum turns negative, I want you to hedge or sell, take profits, and buy into something you always wished you’d done. I want to learn the piano. What would you want to do?
3. Embrace Financial Independence: Empower yourself with financial literacy and responsibility to gain control over your wealth and secure a stable future. This isn’t complicated when you understand how the world has changed over the last 15 years.
4. Master the present… Stop worrying about things you can’t control. Stop. The people in charge are idiots. They are in it for themselves. We are going to do the same thing. We will enjoy our lives and play the markets on the new rules. When momentum is negative, you take the day off. You go do the thing YOU want to do today.
5. Choose you… I decided to repeat Rule No. 1 because it is that important. It’s like the 10 Commandments, where there are two rules about coveting your neighbor’s wife… and then… ass?. It bears repetition. Control your health, your wealth, and yourself. No one else will do that for you.
6. Opt Out: Stop listening to the press. Follow momentum and liquidity with me. Don’t do anything else. Your stress levels around finance will sink like a stone.\
7. Know this: None of this bullshit is your fault. If you’re blaming yourself for the problems thrown at you over the last five years, it’s not your fault. You didn’t fail. The people who are in charge did. Let’s now reverse that trend.
8. Challenge Comfort Zones: Whatever you thought you knew about finance is wrong. Interest rates don’t matter anymore. Borrowing capacity does. M2 doesn’t matter… it has little to do with Repo and commercial paper. We live in antiquated times with a media that doesn’t understand reality. These ideas made me discard a lot of my academic training. Whatever you think you know… challenge it.
9. Live with Purpose - Find meaning - money can help you. Maybe you donate it… maybe you climb a mountain. But money… the exchange of value… needs to be in your favor so that you can achieve the things you dream about. I know this sounds VERY Buddhist. But… I’m a double-belonger of Catholicism and Buddhism.
10. Be resilient: Learn to say no… set rules in place.

A Reminder

I have been out of the market since last week.

Headlines are screaming that there is a Chinese property crisis.

They’re screaming that we must get out of long-duration bonds.

Do you know what I did?

I ate a pulled pork sandwich at 11:30 am, talked to a local construction worker, and had an Iced Tea.

And then, when I was asked if I was drinking Iced Tea or Strongbow… I proceeded to order the latter and buy the construction worker a drink.

Do you know what I didn’t do while momentum went negative?

Panic. Freak out. Worry about my nest egg. Wonder if I’ll have enough money in two years. Last week, I sold calls on my long-term positions, closed short-term trades, and moved to cash.

I don’t have the time or energy to worry about China.

I never know WHY momentum is going negative. I tend to find out about a week or so later – which is evidence that the markets are rigged.

Last June 8, momentum went negative. I sold. It was the largest hedge fund selloff in 15 years after that happened. I found this out by looking at CFTC data two weeks later.

On March 7, 2023, momentum went negative. No one was writing about a regional banking crisis. I sold. I sat in my pool and read the book The Rum Diary the following afternoon.

Today, I read a little bit more of Capital Wars, I had a sandwich (and a Strongbow), threw the ball for the dogs (they just watch me throw it and then lay down), and rode around in the golf cart (which still needs a nickname by the way.)

I had a great day.

Meanwhile, over at CNBC… this happened.

I wish all those people luck. You knew this a week ago… before it happened.

That’s what being a member of the Florida Republic offers.

We don’t short. We don’t bet against the economy. We don’t bet against American workers. We don’t bet against our own.

We wait for the people in charge to cover their tracks. So, when momentum turns positive, you’ll be the first to know.

Stay positive,

Garrett Baldwin

Secretary of Finance