Transcription
is pissed holy smokers the market is
pissed which is weird because drone
power literally just declared quote it's
pretty clear we've avoided a recession
you'd think the market would rally on
that but instead this is what the market
did the NASDAQ decided to start tanking
by 2% Bitcoin decided to sell off by
about 2,000 Tesla decided to sell off by
about
62% what the H double hockey sticks is
going on JP basically just declared
Victory he literally said we've avoided
a recession now In fairness he did say
the fed's not allowed to own Bitcoin and
we're not looking to change that law to
have a strategic Bitcoin Reserve but
that frankly came out of nowhere
anywhere we did hear Drome Powell tell
us that inflation is just a technical
issue that we're really in a good place
and that he quote feels good and he
expects another good year so I'm kind of
curious is the market pulling an inverse
Kramer on Powell j po goes no recession
I expect another good year things are
great Ding and the market just tanks
what's happening because pow certainly
doesn't seem concerned about inflation
even though his committee members seem
pretty concerned about inflation to
where they're only projecting 50 basis
points of cuts in 25 and another 50
basis points of cuts in 2026 which
basically is a whole chunk slower than
what we were previously expecting we
thought we'd get four Cuts next year
we're down to two that's it it's a lot
slower and a lot of folks were actually
thinking we'd get even more Cuts in 2025
as the economy slows so what gives you
got japal saying inflation's just a
technical issue you've got rate Cuts
getting slowed down is there some kind
of warning that Powell gave us here
that's starting to freak markets out
well I think the answer to this is yes
now I'm going to preface this because I
uh saved this particular spot uh but I
want to preface this by saying that jpow
was not overly concerned at this point
that the labor market is having major
issues but he did say some things that
made some people sort of scratch their
heads a little bit and I think it's
worth playing that clip as long as I can
keep this clip and not screw it up let's
see if I could do this correctly listen
to this clip here he does later suggest
that this isn't a big deal but just
listen to the hints in this portion
hopefully again I was able to save this
live at the right time this is why
markets really started selling off so I
hate to kind of leave you hanging on
that uh but this is what he said he said
the downside risks to the labor market
appear to have diminished but it's
cooling further in a gradual and orderly
way we don't think we need any further
cooling it's softer the labor market is
softer than before the pandemic job
that's not good right job creation is
well below the level that would keep the
unemployment rate constant in other
words things are worse in the labor
market than they were in 2019 and the
unemployment rate will probably keep
trending up a little bit surveys are
showing a much much cooler labor market
now than they were showing in
2019 now he does say that things are
still gradually Cooling and later he
clarifies that maybe this isn't that big
of a deal because after all you're only
in a position of seeing about maybe a
tenth or so of uh the unemployment rate
going up every other month so we kind of
cast aside the concerns about the labor
market but this commentary is really
when the market started freaking out a
little bit about the labor market it was
really when he was responding to the
question from uh Mrs SMC over at the New
York Times that's when Markets started
getting a little bit nervous why
officials think it's appropriate to cut
rates at all in 2025 if inflation is
expected to remain firm throughout the
year and what would you expect at this
point the timing might look like what a
January cut potentially be possible or
does a pause next month seem more likely
listen to his labor market talk here so
let me start by saying why we why we cut
today and then and then move to 2025 so
I would say today was a was a closer
call um but we decided it was the right
call because we thought it was uh the
best decision to Foster uh achievement
of both of our goals maximum employment
and price stability we see the risks as
two-sided moving too slowly and
needlessly undermine economic in the
labor market or move too quickly and
needlessly undermine our progress on
inflation so we're trying to steer
between those two risks and on balance
we decided to go ahead with a further
cut and I'll give you some details on
why downside risks to the labor market
do appear to have diminished but the
labor market is now looser than pre-
pandemic and it's clearly still cooling
further so far in in a gradual and
orderly way uh we don't think we need
further Cooling in the labor market to
get inflation down to 2% job creation is
now well below the level or certainly
below the level that would hold
unemployment constant the job finding
rate is low and declining and other
measures such as surveys of workers and
businesses quits things like that
broadly show a a much cooler labor
market than there was that we had in
2019 it's still quite gradually cooling
uh so we we keep an eye on that
inflation we see that story as still
broadly on track and and I'll tell you
okay so broadly on track with inflation
but there were some concerns recently
regarding inflation blah blah blah blah
blah I'm obviously not going to replay
you the whole press conference but think
about that for a moment he basically
just told you for right now yeah things
are definitely softer than they've used
to be but maybe this could still be
Gucci there is a lot of uncertainty
there but what's interesting is the Fed
didn't want to show you that
uncertainty in fact let me show you this
this is the summary of economic
projections on it you will find the
Trump launch sale coupon code for the
Trump anomic course okay you already
know that's at me kevin.com no really
what you're going to find here is
they're showing you in my opinion a
possible blind spot I'm calling it right
here and right here the Federal Reserve
is showing you that they actually don't
expect the unemployment rate to go
anything High higher than
4.6% which is weird because Jerome
Powell just gave you this big warning
where he's like dude things are worse
now than they were in 2019 and we kind
of just hope they stop getting worse but
that's what he told us in August
remember in August when he said we seek
no further Cooling and then what did we
get we got more further cooling why then
are they not telling us the truth that
this unemployment rate could go up more
well it's possible because R Powell is
trying to convince us that the recession
has been avoided he literally said we
have we can we can say we have avoided
the recession he literally said that
maybe because they have to self- fulfill
that to actually prevent the recession
because if they wrote on this summary of
economic projections that there was one
dude or doofus as some would like to say
that said oh no I think the unemployment
rates going to go up to 6.5 or 7% That's
going to price in recession stock market
would crash
and then you'd actually have your
recession because the stock market would
crash while interest rates are
skyrocketing which is like literally the
stupidest thing ever if you look at
what's happening with treasury yields
right now after this fed meeting it's a
complete sh9t show like this is like a
stagflationary disaster of a market
response you have the 10-year treasury
up 11.3 basis points the 2-year treasur
is up 11.6 basis points I mean look at
it on screen here it's a complete
disaster uh you have the yield curve
still about 14 basis points inverted uh
or or sorry uh uninverted uh but what
happens is if this kind of pain happens
where the stock market goes down at the
same time as yields keep Rising all
you're doing is tightening Financial
conditions on top of frothy Financial
conditions when Jerome Powell is hinting
to you that uhoh labor market conditions
could get worse in a jiffy and we'll be
prepared to respond to those now this
was really confusing because multiple
times throughout the press conference he
told told us hey things are better with
inflation like things are going good
with inflation but then he told us that
committee members voted uh to uh you
know write in lower rate cuts for next
year because maybe inflation starting to
move sideways and that inflation was a
major reason why we penciled in fewer
rate cuts for
2025 so which one is it poell but then I
got really confused because listen to
this and you can go play this yourself
listen to this JP says forecasts for
inflation are higher than they were in
September uh you had higher months of
inflation in September and October and
then you got November back on track but
this was really confusing because then I
went to go look at the November
inflation data because he's basically
saying ah we had a couple months of
higher inflation in September and
October and then we got back on track in
November so I looked at the November
inflationary readings and I'm like what
the f are you smoking bro CPI month over
month and core month over Monon was both
both of them were sitting at 3% so
Powell what charts are you reading on
one hand you're saying the labor market
is fine it's worse than it was in 2019
but don't worry it's fine just as long
as it doesn't cool any further and then
you're telling me that inflation's fine
it's really just a technical rounding
era he said those words he's like oh
it's just inflation is just a technical
issue at this point he literally said
that about inflation talking about owner
equivalent rents and housing inflation
taking a little longer to get there and
in you know uh Insurance inflation which
we've talked about that we already know
all that's all old news right but what
are you smoking when you say inflation's
back on track in November and then I
look at the numbers in November and I'm
like bro this is not back on track 3% on
core and month over Monon non-core
annualize out the 3.6% that's not back
on track bro so like I I'm I'm just
blatantly confused by Powell here now uh
J Powell then goes into talking about
you know how we missed our end of thee
projection for inflation and that's why
we're writing in lower uh uh cuts for
next year that was the quote single
biggest factor I wrote that down he said
that was the single biggest factor for
writing in fewer rate cuts for next year
uh but then uh even though that was the
single biggest Factor he also then talks
about how now they're starting to work
inflation from tariffs into their
forecast which pre viously they say they
wouldn't do dude the last two fed
meetings they're like you know we're not
going to consider tariffs uh until the
policy actually hits because uh the
policy could do anything we don't know
what the policy is going to be we'll
wait for the policy to hit then we'll
see what impact it has and then we'll
make a decision on inflation that's what
he said the last two meetings what did
this flip-flopper say today well Mr sick
today comes out and tells
us
um uh show uh the committee is
discussing how tariffs could affect
inflation and this puts us in a position
to make a more careful assessment about
rate Cuts going
forward what so now we're letting
politics affect our our forecast like
what is this what is going on like
everything they tell us just is is just
like Topsy Turvy it just changes every
freaking time no wonder the Market's
pissed off because you're giving us
hints about the labor market potentially
being on the verge of collapsing
and then you're telling US inflation was
the biggest reason why you priced in
fewer cuts for next year but then you
tell us that inflation is just a
freaking technical error and that you're
actually still on
track but you're going to start working
tariffs into your inflation project what
the is going on like this is absolutely
I'm going to say it full
anyway uh then he says oh you
know the economy is still doing well
though everything's fine which I get it
yes you know the Atlanta fed real GDP
infl you know GDP indicators at 3.2%
it's fantastic GDP is holding up people
are spending money like crazy but
everybody knows that's the same thing
that happened in 2007 in 2007 the
everybody was spending money like they
they're drunk Sailors because people had
a lot of money because markets were at
highs the market always hits a high
right before a freaking recession so no
dub people are spending and GDP is high
and then all of a sudden you go into a
recession what happens they revise all
the figures down and everybody's like
how come they revised us into a
recession man I don't understand this is
this is just very very very very very
weird but anyway then he tells us you
know then he sort of backtracks on the
warning that he gives us on the labor
market and he says well it's you know
the labor market right now is not
cooling in a way that causes any kind of
real concerns and you know it's pretty
clear that we've avoided a recession so
you know you could actually keep seeing
a softening in the labor market uh but
uh you know um the softening of the
labor market is actually why we cut
today and I'm like bro I literally wrote
down a quote of you saying you cut for
the the opposite reason just moments ago
and now
it's never mind never mind I'm I'm I'm
getting too confused because there's no
consistency in his messaging today I'm
very very frustrated by it so anyway
what you have let's try to summarize
this all together because there's a lot
here to put together let's try to
summarize this all Jerome Powell today
declared Victory he told us there's no
recession he told us that next year is
going to be great and the economy is
totally fine even though the labor
market is going to crap uh at least
worse than what we saw in 2019 and
before the pandemic and it seems like
it's still slowing and we're kind of
hopeful it'll stop uh then he tells us
hey you know inflation is just a
technical issue and that's why we cut
rates today and then he tells us no
actually we cut rates today because the
labor market is weakening but it's not
so bad because the economy is still
totally fine GDP is Great American
exceptionalism everything is fine don't
panic don't mind the fact that treasury
yields absolutely crush the cost to
borrow New Capital Equipment new
Machinery cars houses credit card rates
don't mind the fact that a lot of our
economy is based on high interest rates
or or longer term interest rates which
are all skyrocketing on this conference
while at the same time you're telling us
the labor market is weakening and all of
the surveys you're looking at are
telling you things are getting worse so
honestly I I've I've gone kind of from
this point where like I I like this guy
to where I'm just like so thoroughly
confused at this point just feel like
I'm being lied to and and I just feel
disgusted about it I I don't know how to
parse it anymore I'm confused this is
very frustrating and all I know is I
need to go pee really badly I have a
course for sale over at meetkevin.com
you already know about it I filmed it
all this month it's amazing uh stock
trade alerts wealth building strategies
course member live streams Tax
Strategies some of them you want to
start taking advantage of this month
before you go into 2025 to prepare for
you know uh um trumponomics and the
other thing I recognize is the NASDAQ is
down holy crap the nasdaq's down 3.5%
Tesla's down 99.2% paler is down 4% the
Spy down 2.5% edas is down 6% Bitcoin is
almost going to break 100,000 over here
everything is breaking Nvidia goes from
positive to down SLE Q's are the only
thing that's going euphoric right now
apples going down Man Mark is just as
confused as I am man I'm going to I'm
going to go I love you all listen no
matter what the hell happens you know
I'm always going to be here for
you I just wish you all the best I love
you all cheers okay I got my uh I mean
at this point this Tesla cup is like
worth more than what happened in the
Tesla okay never mind I got to go bye I
love you all we'll see you soon bye can
not advertise these things that you told
us here I feel like nobody else knows
about this well we'll try a little
advertising and see how it Go
congratulations man you have done so
much people love you people look up to
you Kevin P there financial analyst and
YouTuber meet Kevin always great to get
your take