The Fed U-Turn | The Great Fed Reset.

the FED just gave us some insight and

it's leaving the stock market to

actually turn green today but is it

justified in doing so make sure to stay

to the end to see my commentary is the

Federal Reserve charting the next U-turn

and does that matter well yes and yes in

this video we're going to talk about

both look if you've been watching me for

at least well nine months now you

remember my videos back in January and

February and March where I made it

crystal clear that the bottom of the

market tends to align with the Federal

Reserve u-turning that's what I said

since the beginning of the year that

doesn't mean I've perfectly listened to

my own advice but it has historically

been very true in 1987 markets bottomed

when the Federal Reserve u-turned and

set the precedent for bailing out

markets in 2003 the Federal Reserve

ended the.com bubble by u-turning in

March and February of 2009 the Federal

Reserve ended the Great Recession by

u-turning Congress you turned six months

before that didn't do anything until the

fed you turned

in December of 2018

markets bottomed when the Fed u-turned

in March of 2020 markets bottomed when

the Federal Reserve u-turned if you've

been watching this channel this should

just be a reminder for you that the

bottom tends to be associated with the

Federal Reserve U-turn now I've had a

belief that this time which remember

folks the most dangerous words in

investing are this time is different but

I've had a belief that this time around

markets would be educated that's a bad

thing to assume but that markets might

believe that the Federal Reserve will

u-turn at some point and will price in

that U-turn earlier the problem with

that is pricing in the FED U-turn has

been a fools errand so far consider the

rallies that we had in March or August

of this year all of which have been

crushed and led us to new lower lows

because the FED didn't actually U-turn

if anything they were just getting

started and so this is the danger of

pricing in a Fed Reserve U-turn to Earl

really now we have Charles Evans from

the Federal Reserve who's provided us

some more perspective on when the

Federal Reserve actually expects to

U-turn barring any outsized shocks which

is fascinating that now they're

suggesting barring any outside shocks

and you can't blame them for that

because the first time around inflation

was transitory until we got Delta and

then it was transitory until we got

Omicron and then it's like dang it we've

had more shocks okay never mind it's not

transitory anymore but but it's still

decent it's it's not so terrible oh wait

now war with Russia and Ukraine yeah

this is bad right so other things can

make the federal reserve's policy path

much more restrictive and those things

can be out of their control but that is

not to excuse them for being so late I

mean after all when you have people like

Jeremy Siegel implying that they are or

I should say bluntly saying that they're

afraid because the pendulum has swung

too far to to the other side well then

it makes you really want to pay

attention to what Charles Evans just

said first Jeremy Siegel here I'm not

easy as I've told you and many others do

2020 2021 and now oh my God you know

we're gonna be real tough guys until we

crush the economy

I mean

that that is just to me absolutely

um

poor monetary policy would be an

understatement now you can't blame

Jeremy okay he's one of the guys who was

screaming that the FED wasn't doing

enough last year and is now doing too

much listen to this and then after you

hear this I want you to hear comments

from Charles Evans which just came out

this morning which in my opinion are

leading the market to Rally but first a

little Jeremy you know Scott I find it

very amusing a year ago at that

September meeting when we had booming

commodity prices housing prices rising

at the fastest rate in post-war history

uh when we had all Commodities going up

at rapid rates uh fed uh chairman Powell

and the FED said we don't see any

inflation we see no need to raise

interest rates in 2022. now when all

those very same Commodities and asset

prices are going down

he sees uh you know stubborn inflation

that requires the FED to stay tied all

the way through 2023 makes absolutely no

sense to me whatsoever way too tight we

do not have to get anywhere near that

level to stop inflation because all the

inflation is basically stock

is basically stop I mean you had a

headline just came across three minutes

ago oil back to January levels that's

before Russia invaded Ukraine you can

see what's happening to Commodities

we're going to get the case sure uh

index next week it's going to show no

increase or a decrease for the first

time in years and that's a lagged

indicator on the ground

hamadi all the prices are going down the

only thing that's not going down is

wages and by the way wages are in

catch-up mode don't don't argue they're

pushing inflation they're lagging

inflation

I mean the workers are trying to get

what a little bit back of uh of what the

inflation happens to be I think the FED

is just way too tight they they're gonna

they're making exactly the same mistake

on the other side that they made a year

ago he's not wrong the FED has been

pretty dang slow at reacting and

unfortunately the stock market that we

look at today is the result of the

federal reserve's poor decisions I don't

want to say they were failed because

they're going in the right direction

they're just probably three to six

months too late both on the front end

and the back end remember they were

still printing money in March of this

year when war broke up that's just like

stupid it should have been like an

emergency off switch anyway let's take a

listen to Charles Evans right after

message from our sponsor now if you're

in New Jersey this next one is for you

today's sponsor is a Mojo a sports stock

market that lets you invest in the

careers of athletes now remember when it

comes to betting you don't want to bet

everything okay this is supposed to be

entertainment something that you do on

the side kind of like when you go to

Vegas and you have a great time and

hopefully win some money but folks this

is pretty incredible love or hate a

player you can now go long or short

instantly and build a portfolio in

minutes of players you want to go long

or short on like it's the holy grail for

sports fans and the chance to cash in on

your position and finally invest in what

you know and truly love here's how it

works the app currently offers the NFL

with over 300 skilled players across

quarterbacks running backs wide

receivers and tight ends each athlete

stalk on Mojo has a share price that

rises and falls in real time based on

on-field performance news and anything

else that might affect expectations for

future performance prices move all year

long so there is no off season check out

for example Daniel Jones or Zach Wilson

now Mojo's guaranteed payout formula is

based on objective stats so you always

know exactly what the stock is worth at

any given time think an underrated

rookie is a rising star go along you can

even short a stock and profit as the

price Falls and you can buy and sell

instantly and hold a stock for as long

as you want a play a game a season or

even entire career now remember right

now this is for those of you in New

Jersey it's available on iOS you can

download the app Mojo right now and get

your first stock totally for free worth

up to ten thousand dollars click the

link in the description down below for

your first stock worth up to ten

thousand dollars what is Charles Evans

the president of the Chicago Federal

Reserve believe it is going to be time

for the Federal Reserve to actually

U-turn well first let's set the stage in

terms of How High we actually expect the

FED to go right now the FED funds rate

is sitting at about 3.25 and Charles

Evans tells us where they expect to be

by the end of the year and if we're

going to hike rates next year then we'll

talk about when the U-turn could happen

you for the end of this year is that the

federal funds rate will be in the four

and a quarter to four and a half percent

so there's still a ways to go this year

it's been a very challenging time prices

have gone up relative prices gone up

cars uh durable goods in the U.S many

segments but now it's broader and that's

I think the concern sort of globally

this is a global inflationary

environment with high energy prices and

the concern that it spreads more broadly

throughout you know every economy is one

that Central Bankers are going to have

their eye on and so you know think this

type of brain environment is here for a

while so heading another one full

percentage Point higher towards the end

of this year and a beginning of next

potentially having another increase

taking us to either four and a quarter

percent or four and a half percent with

the median sep summary of economic

projections bringing us to 4.6 got it so

higher for long but when is the U-turn

that's what we care about when is the

U-turn in the mind of Charles Evans here

we go oh yes I'm Charles Evans here to

just remind you about September 30th the

deadline for sending your wire for house

hack and remember you can also join the

programs on building your wealth and

live streams with Kevin doing

fundamental analysis every day the

market is open I'll link down below now

to the real Charles Evans by the spring

of next year we're going to get to a

funds rate that we can sort of sit watch

how things are behaving and if inflation

starts to come down things will be more

restrictive and we would want to adjust

downward the so March or April

spring-ish of next year is when we're

thinking maybe maybe the Federal Reserve

might consider adjusting downward now

unfortunately this is a narrative that

has been relatively consistent at the

Federal Reserve that once we get to a

specific level we're going to adjust

downward and this has a lot of markets

pricing in the belief that okay great

once we get to the spring we'll adjust

downward but I don't actually believe

that is really going to happen I believe

or at this point more likely to hit that

four and a half four point six percent

fed funds rate then the fed's U-turn is

going to take the shape of a pause but

not a decline I would not be surprised

that the Federal Reserve actually Waits

until the end of the year with by the

way markets presently pricing in a

November U-turn in actually dropping

prices that in my opinion makes Charles

Evans slightly dovish however because

this commentary just came out this

morning it is giving the market some

hope it is just my belief that we want

to approach this with some cautious

optimism which is kind of what Evans has

as well optimism the median forecaster

to get to the peak funds rate assuming

you know by March assuming there are no

further adverse shocks and if things get

better you know then we could perhaps do

less but I but I think we're headed for

you know that that Peak funds raid and

that offers a path for employment you

know

um

you know stabilizing at something that

still is not a recession but there could

be shocks there could be other

difficulties goodness knows every time

I've sort of thought the supply chains

were going to improve that we're going

to get Auto production and up and used

car prices down and housing and all of

that something has happened so um

cautiously optimistic now I don't think

this video would be complete without

giving you a little bit

more from Jay about why the Federal

Reserve is screwing up so badly he goes

into talking about how Commodities are

plummeting and many forward indicators

of inflation or plummeting and he's not

wrong Lumber's down over 70 percent

housing indicators are turning but they

substantially lag in inflation readings

by six to sometimes up to 12 months just

let's close this one out not only with a

reminder on the deadline on September

30th for house hack and the course

member streams and lectures but also

let's close it out with Jeremy's rant

was the record declined in the money

supply me I mean what is what is the

collapse and commodity prices mean what

is the lag construction of of the of

these housing indicators that are 40 of

the core inflation what is he actually

looking at and he's looking at three

month annualized core inflation that is

a lag

while we all look at Market I mean look

at what does the stock market do it

looks at Market oriented

data and that's what the FED should be

looking at