We’re here in Las Vegas for this 71st episode of Stansberry Investor Hour, and in a week where Porter and a handful of other Stansberry gurus are meeting with subscribers head-on, Porter teases the Stansberry Research Report Card, where we cut to the chase on how helpful our advice and recommendations actually were for making our readers some money. As Porter tells it, “Even if you have an average return of 25%, but 605 of your recs lost money – I don’t think that’s a great performance. And so – I give a grade that goes beyond the numbers, and looks at the quality of the advice given.” “I don’t have to tell someone that their job is at risk. They know it.” Then – minutes before Senator Susan Collins casts her decisive vote either for or against Justice Kavanaugh – and for or against a conservative majority on the Court for at least the next generation – Buck explains the stakes of this vote, and why this is, truly, the ugliest political fight we’ve seen in our lifetimes – including presidential elections.
Buck Sexton is host of the nationally syndicated radio program, "The Buck Sexton Show," heard on over 100 stations across the country.
Announcer: Broadcasting from Baltimore, Maryland and New York City, you're listening to the Stansberry Investor Hour. Tune in each Thursday on iTunes for the latest episode of the Stansberry Investor Hour. Sign up for the free show archive at InvestorHour.com. Here are the hosts of your show, Buck Sexton and Porter Stansberry.
Buck Sexton: Hey, everybody. We are here in Las Vegas this week for the Stansberry Investor Hour. We've got the Stansberry Research Conference going on. We figured it would be worthwhile to share with you my presentation, Porter's presentation – give you a sense of what went on here. Get ready for it. I'm talking to you about politics – and a crazy week it was – and Porter is going to talk to you about trailing stops and some other financial insights. We've got that and more coming up on the Investor Hour.
Porter Stansberry: You guys might be familiar with our annual report cards. It's the bane of my staff and I think it's the joy of subscribers. I believe that you guys – it's not that you don't care if we're right or we're wrong – it's that you can accept that inevitably we will be wrong. What you can't accept is that we have any incentive to be wrong or that we lie about being wrong. And the report card was a very big innovation. Today still, I don't think anybody outside of our affiliates ever does anything like it. We don't just tell you what the track record was and give you the numbers. I give each analyst a grade because if oil doubles and every oil stock goes up 40%, that's not really setting the world on fire. You did good, but it's not an "A." It's just a "B." And even if you have a market-beating return on average, let's say your average return is 25%, but 60% of your recommendations lost money. I don't think that's a great performance and so I give a grade that goes beyond the numbers and looks at the quality of the advice that was given.
We also don't just do 12-month measurement periods, because that just doesn't make any sense. Very few investments mature in 12 months. We study longer periods – 18 months, 36 months. You guys have seen the way we do this, and the reason why we do it is that I firmly believe that good intentions should be measured. If I believe that a product or an analyst or a strategy is going to work, the very least I should be willing to do is make sure that it does and alert you to the strategies that are working and the strategies that aren't. It also of course helps me manage the company. Everybody knows they're going to get a grade. Everyone's got to work their hardest and everybody knows what happens if they fail. That communication takes care of itself. I don't have to tell someone that their job is at risk... They know it.
In the same light, in the same spirit of that, I'd like to share with you some data that Richard Smith helped us accumulate that documents the last almost 20 years of our newsletter's history. And the question that I asked Richard to help me answer with data is, are trailing stops a good idea? Do trailing stops actually help our subscribers produce better results, or do they just get us off the hook for truly terrible advice? Anybody interested in the answer to that question? The answer is it depends. It largely depends on how volatile the recommendation is. Let me give you some data. At my newsletter, Stansberry's Investment Advisory, we took a sample of 204 recommendations.
Now these recommendations unfortunately have some amount of bias because we needed recommendations that we could easily track. We didn't want to include short sales and of course there's complicated things that happen in the track record, like corporate buyouts and things like that. We're not able to study every single recommendation, but this is 97% of the recommendations on the long side that I made in the newsletter. Now here's the bad news. Out of those recommendations, there are about 160 positions that did stop out at some point after I recommended them. That's a very high percentage of stocks we eventually exit because of stops. What happened one year later? How many stocks out of that 160 went up and how many went down? And the answer is 81 went down and 85 went up, and statistically that's just a dead heat. In my newsletter, it's not clear at all that using stops helped you because half the time it was the right decision and half the time it was the wrong decision.
But if you look further into the data and you study the difference in performance, I think you're going to agree that stops were a good idea. Here's why: of the stocks that went down, the average loss after we stopped out one year later was -50%. That's a debacle. That stock, when it started going down, kept going down and went down big. The stocks that rebounded and went back up were up 65%. Now I don't know about you, but I don't – on a 50:50 odds, I don't want to risk losing 50% in an effort to make 65%. That just doesn't seem like good odds to me.
On the other hand, the stocks that were very low risk that I recommended, of those, six of them went up after the stop and only two went down. And the two that went down only fell an additional 25%. The six that went up rose 38%. I would argue those numbers, although it's a small sample size, are indicative of the idea that I've been developing. That in very low-risk – that is low VQ recommendations for those of you who are TradeStops users, trailing stops probably aren't worth it. I say "probably aren't worth it" because there is certainly an emotional benefit to always limiting your risk strictly, but in low-risk situations, I think you're going to be better off limiting your position sizes and not limiting your trailing stops. Does everybody follow that idea? And I want to be really clear... The data was much more conclusive in terms of low risk. On the overall average basis, I think the trailing stops are a good idea in my newsletter.
Let's get to True Wealth. In True Wealth, we did the same kind of study. We had 217 examples. Of these examples, 49 of them went into decline. They declined another 33% and 99 of them went back up, and they went up 47%. With True Wealth, you were better off not using a stop about two times to one. I would argue that in True Wealth, you're probably better off not using a stop at all. And if you look out even further, if you look five years further out, 31 of the stocks kept declining for a loss of 36%, 76% of the stocks went up for an average of 115%. You were three times more likely to make money and you made a significant amount of money if you didn't use a stop in True Wealth. Now I just can't wait to see what Steve says about all this because he swears by stops and I think it's important to recognize that if you're not using proper position sizing, this advice I'm giving you could be easily catastrophic.
Let me give you the average numbers so that you can see the relevance of what I'm talking about. On average, so all of the stocks that we stopped out of, in Steve's newsletter, on average, those picks were up 20% a year later. You're giving up a 20% annual gain by using those stops. Five years later, they are up 71%, which I think is significant. On my portfolio, on average, the stopped-out stocks were only up 9%, and over five years, they are only up 51%. And again, I think that shows you the significance that how using stops in my newsletter was – had a lower cost, a future upside, than using stops in True Wealth. And what explains the difference? Is Steve just a vastly better stock picker? Yes.
That's mostly the case, but when you really dig into the numbers, the thing that I found that was so interesting – and you're going to hear more about this kind of correlation from Richard later today – is that there was a clear correlation in the effectiveness of trailing stops as it related to volatility. Steve's newsletter has an average VQ of 24. You guys know what VQ is? It's a measure of volatility. Twenty four is about twice as volatile as the S&P 500. My newsletter has a big difference in volatility over the years. The average volatility in my newsletter's recommendations before 2009 was 44. That is my picks were almost four times more volatile than the market on average. After 2009, I changed. My volatility now is only – let's see, where's that number? Give me one second. I've got too many notes. Steve's is 24 and mine is around 30. Yeah, average VQ 30. It went from 44 to 30.
The reason why Steve's newsletter costs you more to use stops is because he is picking more conservative investments. The reason why stops work on my portfolio better is because I'm picking riskier investments. And so I would ask you to look at your portfolio in that way. If you're talking about VQs that are around the market level of volatility, so around a 10 or a 12, you probably don't have to use stops. If you're talking about VQs that are over 20 and under 30, you – it's probably going to cost you to use stops, but you probably want to because you don't want to take on that kind of volatility. But if you're talking about an investment with a VQ over 40, you have to use stops and I think that's what the data is telling us and I'll give you an example. We then broke down my recommendations into three categories of VQ: low VQ, medium VQ, and high VQ. And the stocks that we stopped out of that had a medium VQ, one year later the average gain on those stocks was only 3%. In terms of the efficiency of using stops, the medium VQ – the tax, if you will – was very low. On the high VQ stocks, even five years later, the high VQ stocks were only up 9%.
Sorry, I've got it backwards. My own handwriting is too sloppy. Let me start over. The medium VQ were up 3%. The high VQ was up 12% and the low VQ was up 9%. What's interesting about that is you would expect more volatile stocks to be up more one year later, but they weren't. The medium VQ one year later was actually less than the low VQ, 9% to 3%. And I think that's very indicative of the power of stops when it comes to investments that have high VQ or high volatility. To summarize for you – because I know that was a lot of data and I botched the last part of it – to summarize for you, if you're using trailing stops, you're probably paying a tax if you're using them on stocks that have a VQ of 20 and less. And if you're using them on stocks that have a VQ of 20 or higher, you're probably making the right choice, but definitely on stocks that have VQ of 40 and over, it's mandatory. And so I hope that helps you understand trailing stops better.
I want to give you just a couple of tips about today's meeting. My friend, Jim Grant, is going to give a presentation. I think that Jim Grant is the most eloquent writer and speaker on financial affairs today. I would implore you not to miss that presentation. I'd also like to know just by show of hands how many people in the room have used the pure alpha system on TradeStops so far. Not many people have used this yet. This piece of technology that Richard has developed will totally change your investment life and make your investments way better, and I can't wait for him to show you what that is and I want you to make sure you understand how to use it before you leave here.
And then one more person... I don't know how many of you have ever heard the name Eric Fry, but he's giving a talk today and I want to implore you not to miss it. Eric Fry has served as a guru to the gurus in the newsletter business for about 20 years. He was always behind the scenes helping people like me develop products and develop investment ideas, and he recently began writing his own products, but very few people have given me, in private, as many great investment ideas as Eric Fry has. I'm really proud and pleased to introduce him to you. I've got about eight minutes left and usually taking questions from the audience is highly risky, but I'm going to using a trailing stop. If you ask me a dumb question, I'm just going to skip it. I'll just say the question back. You can just tell me.
He asked a question about have we analyzed what happens if we can get back in after we stopped out, and the answer is we have not done all that homework yet. That's a lot more analysis to do. What I was trying to figure out is just base case, does using trailing stops make sense? And the data was pretty clear. It makes a lot of sense in volatile stocks. It makes less and less sense as the stocks become less and less volatile. And if you think about it, that's what we already knew from our own experiences. A great example of that is I recommended Hershey in December of 2007. That was one month after the previous all-time peak in stocks. Stocks went on to fall more than 50% on average over the next 12 months and we never got stopped out of Hershey because it pays a good dividend and it's a really low-volatility stock. And so using a trailing stop on that is just not going to help you. If you reach a trailing stop point on a stock like that, it's probably time to buy it and not time to sell it. Are there any other questions? Yes, ma'am?
The question is, she wanted to know is – if the lower volatility stocks are good to use with TradeStops. And what I've been saying is that my belief is looking at the data that you don't need to use trailing stops on low volatility stocks. To summarize again, if a stock has a VQ of 20 or less, you probably don't need to use a stop. You still can, but you're probably better off using just position size to minimize your risk. On stocks that have VQs between 20 and 40, I think it's a draw. And on stocks that have VQs over 40, it's no doubt as a necessity. It really works very well. In general, the more volatile the stock, the more important it is that you're using a trailing stop loss. I'll take one more question. In the middle of the room in the hat.
There are a couple of different ways of minimizing risk. And the question is, if you're not using trailing stops, then you're using a buy-and-hold philosophy. Just to be clear, we also exit stocks because we want take a profit or because we think there's a better opportunity for the capital somewhere else. The numbers don't add up. We studied 204 recommendations, but only 160 were stops, so we use other kinds of exit strategies. You'll see this all the time. We're going to buy something because it's being bought out. After it gets bought out, we're going to exit the position like we did with Monsanto. I wouldn't say that Stansberry Research is advocating a strictly buy-and-hold philosophy. I think there are certain stocks where I do advocate that. The stocks that – like Disney and Starbucks and AmEx and Hershey, these companies I do believe can outperform the market over a very long period of time and are very capital-efficient. But no, I don't think that the – there's – I wouldn't say that deciding not to use a trailing stop on a low volatility position with a VQ under 20 is the same thing as being a buy and hold investor.
There are times we advocate being buy-and-hold investor, but that's not the same thing that I'm talking about here, and I want to be really clear and say it one more time. I'm not arguing that trailing stops don't work. I'm arguing that anytime you decide to limit volatility in your portfolio, financial theory says pretty quickly you're going to pay a price for it. If you want to have outstanding, exceptional performance, you have to be willing to tolerate some volatility. That's a factor. That's just a fact of the financial markets, but I don't think that volatility is the same thing as risk. And so what we're trying to understand is, what are the situations where you want to be able to accept more volatility so you can earn higher returns? And there's no question that using trailing stops is a tax on performance and what you pay in that tax will reduce your total returns. The question is, where can you safely accept more volatility and earn higher returns? And what the data we have from our own actual recommendations over the last 20 years almost tells us that in low VQ situations, using trailing stops is expensive. It's not that it doesn't work. It's just that it's going to reduce the efficiency of your portfolio.
And so you may decide, "You know what? I'm not going to use a stop on this because Hershey has a VQ of 8 and I don't want to get stopped out at a 10-year low in this stock. What I'm going to do instead is I'm only going to put a 2% position in or something that I know I can handle that risk." But listen, I'm a little afraid of telling you guys about this because if you don't know the difference between a semiconductor with a VQ of 45 and Hershey with a VQ of 8, and all you heard me say was that trailing stops will reduce your returns so I'm not going to use them, you're going to wake up one morning and see that your portfolio is down 30% because of a single investment. And that's the thing of course we want you to avoid most of all. Please don't mix up this message. Use trailing stops for your risky investments absolutely and think carefully about whether or not you want to use a trailing stop on something that you should be able to safely hold through a cycle. Thank you very much.
Buck Sexton: Some great insights there from the one and only Mr. Porter Stansberry. We've had great presentations from the whole crew here during the Stansberry Research conference in Las Vegas. I saw Sean Parnell give his talk about the first time he had major enemy contact in Afghanistan. It was fascinating stuff. Also really enjoyed Trish Regan's rundown of the economy and what's going on in the era of Trump, trade, tariffs, all that good stuff. And Dennis Gartman, that guy is a beast. He can cover anything. He can talk to you one moment about crypto, the next moment about energy and oil. The guy is a phenomenon. With that, now it's my turn. Here's what I told the folks gathered at the Stansberry Vegas conference.
Great to be here, everybody. Thank you so much. I know I got a chance to say hi earlier on in the morning. Let's get right to it, shall we? I'm reminded of two bits of very important advice. One is what I give to people whenever they're going to make a toast at a wedding. I say, "nobody ever says 'man, I wish that was a lot longer.'" And the other one is what a headmaster used to tell me when I was in catholic school in New York, and he used to always say that whenever you're going to present or give a talk, think of it like a bikini. It should be enough to cover the subject, but short enough to still keep it interesting. I'm going to try very hard to achieve that and here's a quick story that I think really gets to all of it in America right now. In classic Washington, D.C. journalist fashion, let me tell you about this really fascinating political discussion.
Again, politics is my area of expertise. Political discussion I had with my cab driver. I'm in this cab and my driver, he's from the Mideast somewhere. He peeks back at me a couple of times in a row in the rearview mirror. And I say, "I know what this is." His eyes light up a little bit. I go, "All right, this isn't the first time." Doesn't happen to me often, happens every once in a while and I don't want to make a big deal of it, but sure, it's a nice thing. It's a nice thing. Been doing this for a while. He says, "Are you the man from the Fox News?" And I said, "Well, I would like to think I'm better known for radio and podcasting, the Buck Sexton Show on Apple podcast by the way. I used to fill in for Rush. I fill in for Sean Hannity on occasion, but yeah, yeah, sure, I do some Fox News from time to time." "I knew it," he says. "You support our President Trump. You are so smart when you support Trump."
"Well, thank you," I said. "I think Trump's doing a pretty good job, too, actually." Then he got really energized. "Trump is the best. I like the way he talks about America. I like that he likes that we came here legally, but why are there so many lies about Trump? The reporters tell many lies." "Yes, my friend, you are quite correct," I told him, and I am a reporter. Unfortunately, my conversation got cut a little short. I arrived at my destination and it was time for me to go. "Pleasure talking to you, my friend," I said to the driver. "Same, same. You keep supporting Trump and you are so good on the Fox News," he told me. "Tonight I will go home and tell my wife I am so excited. I am so happy that I finally got to meet Tucker Carlson."
I said, "Great to meet you too, buddy. Come by my Fox News studio any time you want."
Obviously that doesn't really tell you much of anything about politics right now, but it did seem like a good way to introduce myself to you. Now at least maybe some of you go home and think I liked that talk by the guy who reminds cab drivers of Tucker Carlson. Who has better hair, I'll leave that up to you.
But now to the business at hand. I had initially planned to come in and talk to you a bit about the midterms and as you know, while I'm not by any means a finance expert, nor do I pretend to be. In fact, what I do on the Investor Hour is what I am, which is learn from Porter and Steve and Doc Eifrig and all these guys. They've actually turned me into an investor. Before I started working with Stansberry, I didn't own anything other than a 401(k), checking account, savings account. Now I'm sitting here checking. What's the latest? How am I doing? What's going on? They've turned me into an investor and I thank them very much for that, and it's been fun for me as somebody who usually shares expertise to be drawing off the expertise of other and actually in a process of learning all the time. And that's really what we do on the Investor Hour podcast, which I hope some of you will give a chance to, and plus it's just a lot of fun to talk to Porter obviously and Country Club Guy, who's around here. Some of you know him as Jamison, but I wanted to get to my role of expertise here for a moment.
I was going to talk to you, when we planned this many months ago, about the midterms. And whether you care that much about politics or not, you know that politics affects all the other things that you care about. I'm talking about trade, talking about tariffs, China, Canada, all the things that are going on right now. If you have a better sense of what's going on in D.C. or "the swamp," as I call it, you have a better a sense of how many of these other things will play out. I was initially thinking that I would get to talk to you mostly about that and play the role of analyst instead of student here up on this stage. I'm an intelligence officer by background. I actually served in Iraq and Afghanistan as an intelligence officer, learned the spy craft trade at the CIA, and now I'm a Washington, D.C.-based political analyst and pundit. I work five minutes from the White House. I live five minutes from the White House, maybe about 10 minutes from Capitol Hill. I'm covering this stuff all day long.
In fact, recently I had the opportunity to spend 45 minutes with the president of the United States in an interview at length on everything. And if any of you have any questions about that, I might address some of it in my conversation, but this is what I'm doing day in and day out now. I meet with senators during the day. I have drinks with their staffers at night. All the political analyst, journalist stuff that you would expect and so I would like to think that I have an outsider's perspective with insider access. And so with that, I want to offer you a where we are right now in this political cycle and it's different than I had expected.
I thought we would sit here and talk about what are the battleground states, what are the places that you have to pay attention to, will there be a big infrastructure bill, can there be a moment of bipartisanship if the Democrats actually take the house. These are the things that I had assumed that we would talk about here, but we have a topic that actually overshadows all the rest of them right now. Because what we are in the midst of this week as I'm speaking to you, today, right now in real time, is an all out political war, the likes of which I've actually never seen before, including even the Trump election. And it is the fight over the Supreme Court nomination of Justice – of Judge Brett Kavanaugh. I honestly think we've never seen an uglier political fight in my entire career. I think it would be safe to say that the partisan political debate has not been this nasty in my lifetime. That's right.
Donald Trump is president. Bernie Sanders thinks that socialism is going to save America and I'm telling you the craziest thing to happen all year in national politics is what should've been the straightforward senate confirmation of an eminently qualified D.C. circuit court judge, Brett Kavanaugh. Instead, what now hangs in the balance is – and I do not exaggerate, this is true – the rule of law as we know it in this country. This will be a different place. America will be a different country going forward depending on what happens in the next few days. I'm not making a six-month projection. I'm not telling you that we'll see what happens in 2020 with Trump. There are massive implications that affect politics and that will also affect the day-to-day lives of people in this room, and I'll get into that in just a moment. Make no mistake about it, the radical left – and I'm sure there are some Democrats in this room. Girlfriend's a Democrat. I do a show every day with a Democrat on hill.tv.
I'm speaking about the radical left and its media allies right now. They are energized in a way that is hard to overstate. They are no longer the party of unions, fair wages, and the civil rights movement, if that was ever really the case. The left and the Democratic Party that it largely controls now is the party of antifa, de-platforming, and trigger warnings. It's the party of socialism, collective guilt, and identity politics, radical feminism, and intersectionality, and 37 genders, 35 of which do not exist. It is the party of – it's true, 37 when you apply to Harvard now. Those are your options. It is the party of women shrieking at senators they've cornered in elevators, a party where maniacs clad in pink hats march in the streets. All of this cheered on by idiot celebrities who profess to care about the downtrodden when we all know they only care about themselves.
And of course spreading all of this filth, lies, and fake news, a mainstream media that is so pathetically biased they no longer hide their disdain for the other side. They're cowardly partisans now posing as honest brokers of the truth. The left said it is "woke." That's actually part of the new terminology. Some of you may have heard that and in a sense, it's true because there's a bestial nature to the outrage that we are seeing right now. It's like a great angry creature has been disturbed in American politics. They've always been emotional. Now they're hysterical. It's not enough for them to shout. It's not enough for them to yell at people on social media. Now they mob us at restaurants and chase us into the street. They are not looking for converts. They're hunting for heretics.
Judge Brett Kavanaugh is just one such heretic. They deride him with cheap, petty, sophomoric digs. "Keg Party Kavanaugh," they call him, a drunk, an angry white male. To them, he is the embodiment of what they call "white privilege." You see Kavanaugh is the left wing's favorite successful Anglo-Saxon bogeyman personified in this moment. "Did you know that he belonged to a country club," journalists sneer. "Do you realize his father was a lobbyist and his mother was a judge?" "I bet he went to school wearing a top hat and a monocle, spitting on poor people as he stepped over them." That's the sense you get from the media right now. He has earned nothing in their eyes. They look at his entire life, decades of success and contributions to society, and they sneer at him, "You didn't build that." They work themselves up into a frothy rage over this. He never checked his white privilege, you see. He has been mansplaining his whole life. They don't need any evidence because he played football and belonged to an elite fraternity.
To the rage-filled left wing, his entitlement is the only evidence they need. The sordid spectacle of Kavanaugh's nomination is hard to parody at this point. Millions of Americans last week were shown how a number of senators desperate to get that one viral clip, including "I am Spartacus," Cory Booker, were yelling on national T.V. about what is "boofing." In response, Kavanaugh had to say under oath in front of the most impressive and hallowed deliberative chamber on the planet that "boofing refers to flatulence and we were 16 years old." The FBI should investigate. That was a piece yesterday being published in places no less than the New York Times, the Washington Post. The FBI needs to look into whether there was a lie about boofing. What does "FFF" mean in somebody's yearbook when they were 16 years old? These allegations are 36 years old, as you know, at least the first set. The second and the third are falling apart very rapidly before your eyes. There is, as of yet, zero evidence and yet this has been the single biggest news story of the past week. It's not just the media here, my friends. The Democrat politicians as well have lost their minds on this one. The seriousness with which Cory Booker and others picked apart that high school yearbook was a disgrace. "What does FFF mean? What is the "devil's triangle?" they asked, which is odd because I thought the devil's triangle was what you called Bill Clinton and two interns left in the same room.
I like that one, too. We watched as the senate was turned into a beer tribunal. "Did you enjoy beer? Did you drink underage?" A huge percentage of America watching this was shaking their heads saying, "Yeah, I did that, too."
What am I missing here? Yesterday the New York Times had a breathless story about how Kavanaugh "may," and I use that word because they can't prove it, may have thrown ice at someone in a bar fight circa 1983. I am not making this up. Any of you can Google it. That was the biggest story they had to offer you yesterday. "He threw ice," they say. The rest of us say, "you need help." Now to be sure, this affects a lot more than Brett Kavanaugh.
The collateral damage of course does not matter at all to the left. In fact, like all true tyrants, you get the sense that the higher the body count, the stronger the message. If you want to send a strong warning to your political enemies, you can destroy those who oppose you, sure. But if you want your political enemies to cower in fear, to give up, or even worse to abandon all that they hold dear and that they care about, then you have to make sure that you destroy those around them, too, not just those who oppose you. You destroy their families, their friends, their institutions, those who support them, those who align with them, those who believe in them. You don't burn down a house. You burn down the whole village.
With Kavanaugh, the left has gone politically thermonuclear and it's not just him they'll take out if they can. They're already ruining the lives of his wives and – I mean his wife, rather, and children on national TV. Actually Kavanaugh's wife is the target of death threats. So are her children. Do you think that'll stop, by the way, if her husband is confirmed? Do you think it will stop even if her husband's nomination is defeated? Every friend and colleague of Kavanaugh's who comes forward risks the same fate. Anyone, myself included, you too in this audience. Any of you who speak out too loudly in public to defend honor, decency, and the rule of law here can be a target. This is not the usual partisanship. The climate is worse. It is more vicious. It is more out in the open. This is different. I'm telling you it is different.
Leftists declare that their zealots should physically follow conservatives. They say this out in the open now. Harass them in the streets. Get up into their faces. They want Kavanaugh, Republican senators, and anyone with the temerity to speak out not to just be silent, but to live in fear, to have to look over their shoulders. A spate of recent news stories tells the tale. At Fiola, a high-end restaurant – Italian restaurant in Washington, D.C., just last week, an angry mob formed around Ted Cruz as he was trying to have dinner with his wife. They called him ugly. They said they would find him at his home. They mocked and ridiculed him. He was trying to have dinner. The restaurant, staying true to its calling in hospitality and to the surprise of some, made sure that the senator and his wife were invited back to finish their meal. They were horrified at what happened and I have told everybody the next fancy meal I go out for in D.C. will be at Fiola. You know what happened to the restaurant after they brought Ted Cruz and his wife back in, Senator Ted Cruz? They now have been the target of the most vicious threats imaginable. They've had to hire security guards for all the hours that they are open. The owner has received death threats, including threats specifically citing his wife and his children because he owns a restaurant in Washington, D.C. and wants a prominent Republican senator to be able to eat there in peace.
I know there's a tendency to say this is just a heated moment. Again, now, today, this week. That both sides are at fault and that this will pass, but I'm sorry, that's just not true. Chasing anyone associated with the White House or the GOP out of restaurants is not an isolated incident. As you know, the White House press secretary, Sarah Sanders, had a similar incident in Virginia just a few weeks back. My friends, we are in a period of mass delusion now. Trump has psychologically broken much of the political left, and they are lashing out. They're flash mobbing political appointees, menacing them in public, and humiliating them in front of their spouses. And this is an endorsed tactic and the media cheers it on. This is all happening also in a town that I now have to call home or the swamp. There is a very real tension in the air. It is ominous. This should never be normal, but it's becoming the status quo.
Make no mistake, they are as committed to this as they are delusional. These progressives, the ones who are storming the halls of the Senate, the ones who are dressing up in Handmaid's Tale costumes, they refer to themselves as the "resistance," explicitly to associate themselves with the French anti-Nazi resistance of World War II. They call themselves "antifa" for "anti-fascists" and speak of the need to oppose Nazis, which they often loosely define as anyone too closely aligned with the GOP or Donald Trump. They believe and celebrate what they call "Nazi punching," but then they will attack well known conservative scholars. AIE author and scholar Charles Murray was about a year ago attacked on Middlebury campus. He was swarmed and assaulted. The female professor who was bringing him to this invite where he had been invited, she was also physically attacked, pushed, and threatened. This at a supposedly elite liberal arts college with a price tag of $50,000 a year. This kind of insane rhetoric that they're spewing all the time can have very serious consequences.
These actions can snowball. It can get worse. I need not remind you, but I guess that I will. That a little over a year ago, a few miles from where I live in Washington, D.C., a left-wing zealot, one whose politics would be in line with your average MSNBC watcher, attempted a mass assassination of conservative members of Congress. And here I am speaking to a room full of highly educated, successful, worldly, talented people. And how many of you, without resorting to Google, can name the man who almost took Congressman Steve Scalise's life with a bullet that shattered his pelvis and almost bled him out right there on the baseball diamond in Alexandria, Virginia? How many of you can name the man who was seconds away from eliminating Senator Rand Paul? Not from politics, but from the face of the earth. I'm guessing it's very few. James Hodgkinson was his name. Why don't we know that name? That was a moment that you would think the media would recall and remember, but if you don't remember that, I'm not at all surprised. The media covered it in sterile fashion. They quickly moved on. It didn't suit their agenda, you see. They don't refer back to it. It's not something that they need to talk about anymore. Their panels don't bring it up.
The rest of the sanctimonious left meanwhile still preaches about the need for Trump to show more respect and deference. This is all really serious and it affects you. The contagion of this is everywhere. It's worse than it's ever been and let me just say this: if they can do it to Kavanaugh, my friends, they can do it to absolutely anyone. If the presumption of innocence is something we will abandon now because one political party views it as politically expedient, this will set a precedent that will not go away. The weaponization of rumors and the Stalinist tactics of character assassination based on innuendo and a prove your innocence standard will erode all political discussions, and anyone can be targets.
Those of you sitting here saying, "I'm not politically active. I don't care that much about politics." Guess what? They can come for you, too. They have. Think of what they did just to the CEO of Mozilla some years ago for supporting traditional marriage in the state of California. In the same year, by the way, that President Barack Obama was running for office as a proponent of traditional marriage. Five years later, they decided he was unacceptable and he was forced out of his company. Not a public person, not somebody who was writing all kinds of things on Facebook and social media. If they want to come after you, they can. If they want to make an example of you, they will. All you have now is due process and some hope of getting the truth to clear your name.
That's what I wanted to tell you about what's happening. In terms of the predictions for the midterms, because I don't want to trespass on the times of the next speakers, I'll just say this: if Kavanaugh fails to get through, I think you might see a red wave. If Kavanaugh is blocked, that is my likely prediction, but the truth is nobody really knows because this was not expected by anyone. And I would just say this in closing: this is a total war, scorched-earth, anything-for-power, anything-to-win approach to politics. Brett Kavanaugh could be you. He could be any husband, father, son, or friend in your life. We cannot allow him to be destroyed based on unproved, uncorroborated allegations. It's no exaggeration to say the soul of this country will be tarnished if the hit on Kavanaugh is successful. We will get through this, I believe. Eventually I hope the good guys will win, but we are, this week, entering what will be a long, tough fight. And Election Day 2018 is just the beginning. Thank you so much for your time and for your attention, and that's what I've got for you.
So there you have it, the latest political insights I can offer about what's been an insane time in American discourse with all the stuff about Kavanaugh and the Supreme Court hearings, and it's been wild. Hope you enjoyed that. We also had a kind of unexpected guest speaker show up at the conference. Who would have thought that right in the middle of things, we'd get a phone call from Arianna Huffington?
Porter Stansberry: Oh, excuse me. It must be the Ferrari dealer. Hello, this is Porter Stansberry.
Porter Stansberry: Oh, my gosh. What a shock, it's Arianna Huffington.
Impersonator: Darling, you need me there. Have you made the healthy lifestyle changes I told you to? Of course not. Porter, I can smell the red meat and cigars on you all the way across the country.
Porter Stansberry: Yeah, I know, Arianna. I could drop a few pounds.
Impersonator: Now Porter, I'm very, very upset with you. You promised me this year I would come to Vegas. No, I'm watching on the live stream and now I see why I didn't get an invite. Porter, come on. Your audience has so many white men, it's like I'm at a Kenny G. concert. Seriously Porter, I've seen more diversity at the Mike Pence rally.
Porter Stansberry: Arianna, Kenny G. is a great artist and we've been very busy. We have lots of qualified speakers, but I'll try. I'll try to get you on the platform for next year, okay?
Impersonator: Porter, this is crazy. First of all, you don't have a single lifestyle expert. Who will tell your audience to take naps? Who is there to make sure everybody is doing the yoga? Instead of feeding your subscribers prime rib and scotch, you need to try tofu and wheatgrass. That always gets the party started Arianna style.
Porter Stansberry: I haven't had much wheatgrass, Arianna, but I'd love to try it.
Impersonator: It's very delicious. Before you hang up on me, Porter, I know you have your big, fancy conference and continue all your mansplaining. I have some financial wisdom for you.
Porter Okay, Arianna, we're interested in your advice. You've been very successful at conning investors at least – I mean, in business.
Impersonator: Why is sex like a bank account?
Porter Stansberry: I'm not sure you're a good expert at sex.
Impersonator: Porter, sex is like a bank account because when you withdraw, you lose all interest. Thank you, everybody. Be sure to stretch, nap, and tip your waiter.
Porter Stansberry: Thank you, Arianna.
Buck Sexton: All right, everybody, we'll be back next week with mailbag and all the rest of it on the Investor Hour. We really hope you've enjoyed this edition of our special from Las Vegas Investor Hour episode. As Porter says, love us or hate us, just don't ignore us. Give us your feedback, investorhour.com is the place you want to go. See you next time.