CRAP | Major Economic Warning.

Well, we're back in no man's land when

it comes to data because everybody's

waiting for actual data the market might

respond to. But what we're really

responding to is Myron freaking out now

calling for even more rapid cuts. Waller

confirming the October cut while at the

same time we've got business surveys

that are saying we've got issues and

Citadel the glorious suits are having a

party. Now, why do you think Citadel's

having a party? Well, folks, it has

everything to do with a little bit of

basic fundamental analysis at Robin

Hood. If you ever do any kind of

fundamental analysis at Robin Hood,

you'll find that the most profitable

portion of the Vlad business is options

trading. It's where they make so much

money off of you that they love your

options trading. And who provides the

rebates? none other than your homies

over at Citadel, your favorite Ken

Griffin suits who love GameStop. Oh,

wait. I read that backwards. But anyway,

Friday, October 10th, listen to some of

these stats. Friday, October 10th,

marked the largest options trading day

in market history. Never before, nobody

knows options trading quite like

Citadel. And never before has the market

seen 108 million option contracts traded

in one day on October 10th. That was

when we had the Binance scam rug pull. I

mean that's just an opinion. Don't sue

me, bro. Uh the um the the crypto

shocker that nobody could have seen

coming. There was there was absolutely

nobody nobody could have seen the crypto

scam coming because after all we have

the Security and Exchange Commission

that watches what's happening, right?

Oh, wait. SEC October 1st announces that

until further notice, the agency will

have very limited number of staff

available.

Huh. And then in, you know, just the 9

days thereafter, we get a $19 billion

rug pull. Would be crazy if some whales

happened to time some insider trades

just, you know, minutes before such

announcement that would end up minting

those whales hundreds of millions of

dollars. That that'd be crazy. But

anyway, so largest amount of options

ever traded in market history. This is

uh the second time ever that we've

crossed 100 million option contracts.

The first time being on liberation

day, which is wild. Uh where we first

topped 100 million option contracts

traded. Optionwide flows are currently

exceptionally high with Friday's surge

epitomizing the buy the dip me

mentality. So institutions are hedging,

but retail is going absolutely ape

for options and stocks. Retail is like,

"Bro, I'm all in. Shove it up the butt

even more. Go deeper, baby. I want more.

More margin, more contracts, more ETF,

more everything. ETF flows have, by the

way, been positive for, I want to say,

205 out of the last 207 days. Uh, and

even though you get institutions that

are degrossing, retail is not. Retail is

legit all in on this. And I wrote over

here that the value of equities held by

the final 50% of households increased

by, you know, 542% since 2020. I wrote

this little red mark here. I said if the

stock market crashes, we screwed. So, we

really cannot afford a stock market

crash at this point. Now, you know, are

we going to get like a really bearish

scenario four where we get some kind of,

you know, long and highly aggressive

fight against China? Probably not. I

don't think that Trump or Besson are

going to go for this. I think we're more

likely to be in like a scenario three or

two, which is where you get these little

tit fortat retaliations and the trade

war just goes on for like years. This is

exactly what happened in 2018. And it

led to a lot of uncertainty in 2018. It

actually led to a bond market crisis at

the end of 2018 that led to the Fed

bailing out markets by promising not to

raise rates anymore. You know, we went

all the way up to a to a rich 2 and a

half% on yields or rates rather, the

FOMC rate. Which then begs the question

of like, well, what did the Fed tell us

this morning cuz, you know, it kind of

matters what the Fed and Myin and some

of these knuckleheads are saying. As

much as we don't really want to have to

pay attention to it, it matters. So

Myron this morning said that 25 basis

point cuts are too slow to save the

economy which isn't great. So Myerin is

here advocating that we should really

like as soon as possible be cutting

cutting cutting cutting more. Uh this

makes me nervous now. I mean you already

know that I've like we actually made a

little chart here uh on uh if you go to

this isn't a pitch me.com/data.

So, if you go here below the pitch, you

see this little chart, uh, I put bearer

bull scale, right? I still want to

adjust this a little bit to actually

make this slightly more to the left

here, but I put myself at 43 out of 10.

And people are like, man, Kevin, you

know, why are you not more bullish?

Like, the Fed cutting the Fed cutting,

you know, even Paul Tudtor Jones this

morning, he's like, yeah, I mean, like

corporations don't have massive debt yet

and the Fed's cutting, rates are going

to be lower, so you know, stocks are

going to be higher. And it's like, yeah,

that is like the most basic analysis

that you could possibly do on the market

right now. Oh, the Fed's cutting. It

must be a good thing, right? Not

necessarily. See, typically the Federal

Reserve cuts going into recessions.

The Federal Reserve panics when they

realize the cuts don't do anything. And

it's when they turn the money printer

back on and they actually like, we just

turned off the vacuum cleaner. Okay, we

were just vacuuming up money. We just

turned Well, we we're just announcing

that we're getting ready to turn off the

vacuum cleaner. Technically, a vacuum

cleaner is actually still running. So,

we're just barely getting ready to turn

off the vacuum cleaner. Okay, the

markets don't bottom until the Federal

Reserve panic so much that they're

printing like crazy. So, this idea that

people are like, "Oh, the market's going

to go up because the Fed's cutting,"

it's just not historically how it works,

especially since there long and variable

lags between when, you know, cuts happen

and when the markets actually see that.

But anyway, it's one of the reasons I've

been kind of stuck in this this midpoint

because I actually I think Myron's on to

something. And the fact that today he's

like, "Dude, you know, 25's too slow,

man." Waller did tell us this morning

that we are going to get uh well, in his

opinion, the 25 basis point cut in

October, which is basically a foregone

conclusion anyway. The market's pricing

in like a 98% chance that we're going to

get a cut in October and like a 97%

chance we're going to get a cut in

December. We're going to get our two

extra cuts, right? So, this is fair. We

see this. So, while Waller can't confirm

it, it's pretty dang likely we're going

to get that extra 25. Myron's pushing

for 50. We're not going to get that. Why

is he pushing for 50? Because, frankly,

even Waller reiterated what Myron's

worried about, which is

jobs are going to get cut because of

artificial intelligence. We know that.

The problem is the lag between when

people lose their jobs and when people

get jobs because of new opportunities

that come out of AI.

Nobody knows. Waller thinks it'll be

over two years. So, in other words,

Waller thinks we're going to go from job

losses now to maybe in two years we'll

actually see jobs come back. Nestle's

cutting off 15%

or they're cutting 15% of their staff,

like 16,000 people or whatever.

Actually, I think that's closer to 17%

or 7% of their staff. Sorry, I think I

screwed that off. I think it's they're

laying off about 15 to 16,000 people and

it works out to about 7% of their staff

because they've got over 200,000

employees. So, that makes more sense.

But anyway, they're cutting a bunch of

their staff and the CEO is literally

saying the world is changing. In other

words, it's just a euphemism for AI is

taking your routine, boring office job.

I mean, I see that like I've mentioned

it before. We see it at Houseack, too.

You know, at House Hack, we're like,

"Bro,

we could do so much more uh with fewer

people now." It's it's amazing. But

anyway, uh Amazon 15% of HR staff just

announced that they're getting laid off.

That's big. Waller sees rates 100 to 125

basis points lower. He's trying to

confirm the October cut. Obviously, he

doesn't have the power to confirm it,

but he's trying to. And I wrote this all

on the October business manufacturing

survey that came out this morning, which

suggests that current activity fell

significantly

and turned negative, more than

offsetting last month's increase. This

is the Philly Fed uh index. And while

the new orders index rose, we did see

employment tick down. So, not a great

read from the Philadelphia Fed,

definitely came in below expectations.

Another one that came in below

expectations was the New York Fed survey

where they say that business activity

declined substantially in the region in

October. Now, we have to be careful like

these surveys can be volatile but on a

month- over-month basis, but it's worth

reading this. The survey the surveys

headline business index fell to a

multi-year

low. Business climate remained worse

than normal. So, like this is why I

think the Fed is starting to wake up and

go, "Crap, man. We need to stop being

neutral. We need to prepare." That's

what keeps me nervous about debt. And

and this is like I don't want to sound

redundant. Like I I really want to hit

like the news and stuff here, but I I

don't want to sound redundant, but there

is a real opportunity to look at your

situation and say, "Are you ready to pay

your tax bill that's coming up this

year?" here, whether you pay your taxes

quarterly, April 15th is coming up or in

April, you know, are you ready to pay

off those buy now pay later debts? Are

you going to survive a larger downturn,

like you don't want to get caught with

your pants down or, you know, with no

pants on? Uh, anyway, so so keep that in

mind, you know, by I I put I send out

little notes like this totally for free,

by the way, in the um uh in the Meek

Kevin app. If you download the Meek

Heaven app and you get the uh you go to

the daily wealth tab, I send little

productivity and happiness and and like

daily wealth hacks. I send them every

single day. So, if you want that for

free, you can download the Meet Kevin

app. You get my data and all that sort

of stuff and then you can get the daily

wealth as well, which I think is cool.

But anyway, right now you're seeing the

market slip. And so, a lot of people are

like, "Have it, you know, why is the

market slipping?" Well, it's probably

because we just had another continuing

resolution fail. Uh Donald Trump is

talking to Putin because Putin's trying

to walk Donald Trump off the cliff of

sending tomahawks to Ukraine. I don't

think that is like necessarily leading

to the market selloff regarding Putin

though or sort of a relaxation here. I

think people just realize like look

earnings for Q3 are good. Taiwan Semi

just reported great earnings but people

are starting to use that as an

opportunity to profit take. Taiwan Semi

literally told us, "Hey bros, we thought

we were going to have uh 30% growth in

sales next year." Uh, we were wrong.

Sales growth is actually going to be

more like 35%.

So, we're kicking butt. So, ASML's

kicking butt. Taiwan Semi's kicking

butt. Like, they're all kicking butt.

They're doing really well, which is

fantastic. So, then why are companies

selling? Well, part of it is seasonal.

October sucks. In fact, Citadel goes as

far as saying that October is seasonally

bad, but it usually leads to an

endofthe-year rally. So, if you get a

sell-off in October, it can lead to an

endofthe-year Santa Claus rally. I don't

know about you, but I personally have

heard about Santa Claus rallies. I feel

like every year for the last 5 years,

and every time it feels like around

Christmas, the market's actually red.

Maybe that's just a feeling that I have.

Wells Fargo thinks consumers are going

to continue to spend. They see for they

they forecast holiday sales rising 3 and

a half to 4% uh you know year-over-year.

I also though I can't help but be

skeptical that not only do I think

companies are starting to like go into

profit taking mood where like you could

see no news and you could see a stock

down substantially. Like you know

yesterday I thought this was really

interesting and this is just another

example of you know some of the things

that we're trying to add to the Meet

Kevin app which I think is really fun.

But yesterday, somebody posted uh they

they wrote, "Hey, there's a dip on

Axon." And this is this is what the Me

Kevin app looks like. And so I posted

some screenies. I'm like, "No news. Kind

of weird." And I also said, "Oh, wow.

Axon launched a mini for healthcare,

which is kind of cool. They launched a

body camera for health care, the

healthcare industry." I'm like, I don't

know what that's going to mean for

privacy, but um people are really

excited about a potential healthcare

vertical at Axon. It's a great company,

by the way. Do I still have my taser

here? I know. Oh, no. I gave my taser to

Lauren. Darn. I love taking that thing

out and showing it off on uh uh on

videos. But anyway, then I posted that.

This was crazy. This was a crazy

headline. I posted that. This is in the

community tab, by the way. Course

members get the community tab. We're

just now building it out. It's like in

alpha alpha. But anyway, just keep

trying to add more value. But listen to

this. China is adding 14 foreign

entities to some of its unreliable

entity lists. And that includes Done by

Axon. So this is actually kind of scary

in my opinion. Uh oh, and then by the

way, we looked at volume because, you

know, we're we're I was working to align

insider sales on Axon with and you could

see that on the 24th over here. Uh and

then here recently yesterday. But

anyway, those are just some of the

things I was posting. Done is a company

that Axon bought and it was designed to

fight enemy drones, whether those are um

military drones, whether those are just

like, you know, consumer drones and you

know, some losers doing things they

shouldn't be doing with the drone or

whatever. And they want to sell these D-

drone products to countries like you

know, whether it's the United States or

Germany or whatever to take down these

drones. And I think it's very

interesting that China is like, "Oh no,

we don't like this. We are a massive

drone manufacturer. we are now going to

add the company that wants to take down

drones to our list of unreliable

entities. To me, that's like that's a

little bit of a war threat. You know, I

didn't like seeing that. I'm like, man.

Yeah. I mean, think think about like the

by line you could run with that. I

actually wrote it here. China bans

American company fighting hostile drones

while China is a massive manufacturer of

potentially hostile drones, right? I

mean, they they manufacture Well, so

does Iran. Iran manufactures hostile

drones as well, but we know DJI is a

massive manufacturer of drones. They're

actually really good, too, which in part

is also scary. But anyway, I think

broadly what's going on is you you don't

have this foregone conclusion that the

Federal Reserve freaking out with rate

cuts definitely means market up. Uh I

know I think that is like a belief by

retail, but it's just I as somebody who

studies the Fed on almost a daily basis,

I just want to remind you and this is

not to be bearish. I I feel like I'm

more in like the neutral camp. I'm like

we can teeter either way here. But as

somebody who studies the Fed, I just

want to remind you the Fed cutting

especially when they start getting

nervous is a warning sign. I will

explain that briefly. Uh but I also want

to mention MP material. Shout out to the

alpha report because yesterday in the me

alpha report I shouted out that MP

material was likely to reject 100 again

and sell down from there especially as

the sort of recent momentum starts

fading. Dude, we went to pre-market 104.

That's it. Once we rejected 100 three

times, over triple rejection down. So,

if you want these sort of insights, make

sure you're part of the me Kevin Alpha

report. I think it's really good and and

it also keeps us level-headed. Like we

were talking about, hey, like there's

some profit taking coming even this

morning. But anyway, uh and we did

fundamental analysis this morning as

well. But understand that the Fed cycle

which we could really analyze by just

look at FOMC St. Louis Fred rates. Okay,

let's look at the uh FOMC effective Fed

Fed funds rate. Okay, so when you look

at the effective Fed funds rate uh and

we we look at the business cycle. So

let's just zoom in over here. We'll go

to uh the 60s for a moment. You can see

that you have to know that recessions

are painted in the past. So most people

probably didn't know in the '60s that we

were in a recession until like August or

September of 1960, right? Because these

lines get painted in the past, the big

gray recession lines. So the Fed was

cutting into recession. That's very very

common that the Fed cuts into recession,

right? Uh and so let's look a little

more granular into some of the recent

numbers over here. So we know COVID

obviously. Let's look at 2008. Okay, the

Fed started cutting in July of 2007.

Okay, we didn't realize we were in a

recession until September of 2008 with

Lehman Brothers. The Fed had already

been in a cutting cycle. The market

didn't bottom from cuts. The market

bottom because we turned the money

printer on.

Every time we run the money printer,

that's the bottom. It's not the cuts.

Oh, that happened again. That's

interesting. I think when I bang on my

computer, my on my keyboard

that happens. Uh, let me lock that so

that stops happening. That's funny. Uh,

but you know, let's do another one. I

think it's it's a worthwhile experiment.

Let's do another one. Let's look at 2000

and the early '9s. Look at this early

90s. You cut in '89 going into the '90s

crash. you cut going into the.com

recession, right? Uh let's do it again.

Let's go let's go to the 80s and 70s. So

80s and 70s, you're cutting going in.

You're cutting. Now this was actually

interesting because of all the inflation

in ' 74. This was the Arthur Burns era.

This is where the Fed lost a lot of

credibility. We actually hiked during

the recession. Uh Fed was all over the

place in the 70s. So this is probably

not the best example. Uh and then of

course we had the Paul Vulkar double

double recession over here. Uh but this

was also to fight the inflation disaster

of the 70s. So this is a little harder

to utilize. But I would say before the

1970s disaster where they removed price

controls, you know, price inflation went

went crazy. Uh the Fed had to, you know,

fix the Arthur Burns mistakes by pull

Vulkering and actually putting the pants

on at the Fed.

Typically, you see rate cuts as an intro

to a recessionary environment. And

that's not to say we don't want to be

bullish. Trust me, I want nothing more

to be bullish. I was literally literally

sitting yesterday uh saying, "Hey, I I

don't want a recession to happen because

I think the AI that we're going to

launch is going to be freaking awesome."

And I think we could sell a lot more of

it, you know, if there's no recession.

Although I think honestly we probably do

really well during a recession anyway

because well we have no debt. Uh no so

no bank debt and um you know people

there going to be a lot of deals to go

pick up in real estate. So you know I

guess who knows maybe maybe we'll be

fine either way. But uh you know it's

just bad for a lot of people. If

household wealth gets crushed man

because of profit taking or whatever or

some kind of down cycle that's going to

suck. But look at the consumer stocks.

Briefly touched on this earlier. Look at

Dave Busters for example. David Buster

is just sort of your classic consumer

stock. We're we're knocking on the door

of Liberation Day lows. And if you zoom

out even more, we're at almost COVID

lows on Dave and Busters. I mean, not

quite. I mean, CO we got really low.

It's like CO post CO shock stabilization

lows, you know, and then you've got

restaurants that they're not doing the

best either. I mean, you could see

Cheesecake at a nice little rally here,

but we're starting to see this slowdown

in consumer place. And it sort of makes

some people wonder like, hey, is this is

this a red flag that, you know, the

consumer while they're hopeful once

these layoffs hit, which now we're

starting to see, we're getting these

announcements again of thousands of

layoffs. That's actually something

that's making people nervous too is you

look at you go like lately what a lot of

the companies have done like Salesforce

is they've actually just said, "Hey, um,

everybody's got to come back to the

office." And when you fundamentally

analyze Salesforce, you see that

Salesforce is growing, uh, its operating

leverage, which basically means their

revenues are growing at one pace, uh,

but their operating expenses aren't

growing as much, which means they're

making more money, their margins are

going up. One of the ways they're doing

that is they're requiring everybody to

go back to the office. But requiring

people to go back to the office is

basically a way of sort of encouraging

layoffs through attrition. So then

people leave and they quit their job

because they don't want to go back to

the office, whatever, and they don't

rehire. But the fact that Amazon is now

bluntly going, "Ah, we're laying off 15%

of HR." And Nestle's like, "Ah, we're

laying off 16,000." When we get those

larger waves of layoffs that we've kind

of been insulated from since 2022,

we had a lot of layoffs in 2022. uh if

we start seeing those large waves

continue, just know the bev the

beaverage curve, beverage curve, however

you want to say, will normalize very

quickly and that will shoot the

unemployment rate up and and then the

Fed will have to continue to frantically

cut. So, you know, it's

is somebody was asking me yesterday,

they're like, "But Kevin, you know, the

Fed's cutting. They're they're shifting

dovish. You said that's what they should

be doing. That's bullish, right?"

They're like, "Yes, that is what the Fed

should be doing, but is it bullish

because they're doing what they should

be doing,

or is it bearish because they're

realizing they're too late?"

So, it's like, yes, they should be

cutting, but are they cutting because

they're too late? Are they cutting

because they want to get ahead of it?

All right. I mean, look at this. United

Airlines was t talking up their premium

revenues yesterday, right? the they they

were literally talking up all of their

premium revenues and how great they're

doing and and how much money they're

making. Uh and and mind you, when you

actually look at their earnings, their

capacity was up. So that was one of the

reasons their earnings actually went up.

Their pricing power actually went down

for normal seats. Pricing power went up

for for you know expensive seats like

premium class tickets. But lower class

tickets or normal class tickets actually

fell. Like their pricing power is

non-existent. The only reason revenue

popped is because they added more planes

basically. But they actually had decent

earnings. You know, people were cheering

this company's earnings yesterday. In

fact, if you look at the post market,

you could see post market they initially

ran. You know, United Airlines, yay, the

stocks. Look at it now. It's tanking. Uh

and and part of it is is probably this

fear that wait a minute, are we do we

need to take profits now? Are they only

going up because they're adding volumes?

Are consumers really under pressure

here? Uh you've got uh United Airlines

also, by the way, announcing that

they're going to shrink headcount by 4%

in 2026.

United says many competitors lost money

during the summer. And United expects to

hire pilots and flight attendants in

2026. This is kind of interesting

because they're kind of like, hey, we're

going to hire operations staff, but

they're probably talking more layoffs in

like the human resources side because of

AI or otherwise. Uh but uh but again, I

mean, they had revenue per passenger

mile that beat

expectations and their earnings forecast

beat expectations, but the stock's down

9% now. That's huge. Even though they

beat uh and so who knows again, maybe

it's just that seasonal time of the

market, you know, where people are like,

"All right, time to take some tendies."

Uh and I get it. Like I I totally get

it. Again, I say this just to be like a

a reasonable person. I don't want to

just, you know, shill one argument, but

I don't think if you have like if you've

made good money this year, remember,

you're going to have to pay taxes. If

you're a trader, you've made good money

this year. If you're running a business,

you made good money this year. Dude, I

got a massive tax bill coming up. Thank

you in part to so many of you joining

the Me Kevin Alpha Report. Honestly, I

think we're hitting it out of the park

with the Alpha Report. Like people were

emailing me going, "Dude, like Kevin's

on a like in this groove we haven't seen

in years." And I thought it was really

nice. Well, partly I was like, "Oh, you

saying I've been out of my groove a few

years ago. Maybe I was." Uh, but now

they're like, "No, now it's on it with

the community updates, the videos, the

live streams, the alpha report,

whatever." So, I I really appreciated

that. I thought that was nice. But I

have taxes to pay. And so, like, you

know, I'm at that that place where I'm

just like, I'd rather not gamble my tax

money at on some of these valuations

because this is a common thing that we

do as investors. Like, we know we have a

tax bill coming due next year, but then

we're like, ah, but just just leave it

in the market a little bit longer. Just

just a little bit more, man. Just a

little bit more. And and you have to

remind yourself that is the definition

of greed.

uh you know and that's like a biblical

sin.

So, you know, part of me is like h you

know, you you don't want to sell

anything cuz you want to keep going on

the ride, but then on the other hand,

it's like h well, what do you want? You

want to be safe, you know? So, I I I

don't know. It's it's a balance. I think

that's the way to put it. It's a

balance. Like, nothing says you sell

out, but drisk. Nobody should fault you

for nobody should clown you for

d-risking, right? Uh that's kind of

interesting, you know, and then

obviously gold like it the fact that it

keeps rocketing is is a warning sign

because it could also be indicative of

you know the economy just I mean part of

it is just momentum because when when it

goes up it just keeps going up. Uh this

like 2% again today dude for gold gold

2% in a day. I mean we're now at 4,300

basically on gold. it it is becoming

less of a good investment and more of a

red flag because it's exactly what

happens leading into recessionary

environments. What'll probably end up

happening, not yet, but eventually

what'll probably end up happening is I

do think the government shutdown will

end before the end of the year. My

rationale for that is uh you're going to

end up having Democrats that are like,

"Bro, you guys said we would be able to

negotiate healthcare subsidies before

the end of the year. Now we're at the

end of the year and then they'll have

some kind of deal around healthcare

subsidies and the end of the year, you

know, reopening of the government or

whatever. Then you're going to get like

two or three jobs reports all piled into

like one day and people are going to be

like, "Oh my god, we're in a recession."

That's a real risk factor, right?

Hopefully we confirm a soft landing, but

people are going to go, "Oh my god."

Typically gold sells off once you

acknowledge like, "Oh my gosh, we're in

a recession." And bonds skyrocket. like

people go from gold,

the horde just like stampedes over to

gold or sorry to bonds and bond deals

tank. Uh and the side where you tend to

make the most money in that sort of

scenario is the longer end. So the 10,

20, 30-year end of the curve, the

shorter end of the curve moves larger,

but the actual underlying price movement

is is very little. Uh so cuz there's no

duration but anyway you know the 10 year

is about to break under four that's a

big moment because once we get under

probably 396

that's when you could get sort of that

escape velocity to the downside upside

on on bond prices right uh so we'll see

we'll see but uh it's we are in a wild

time of uncertainty uh and it it's sort

of those times where I'm like it does it

pays to be just a little bit safer. And

remember if you want to see what I'm

doing like where I'm putting money or

where I'm trimming money, join me in the

meal alpha board. You see it all the

time. So uh you get just like 20 minutes

ago I sent out a trade alert and you

know and it's not designed to be copied.

It's not personalized financial advice.

I can't guarantee I'm perfect.

Definitely not. But uh yeah, that's my

take on what's going on in the market.

>> Why not advertise these things that you

told us here? I feel like nobody else

knows about this.

>> We'll we'll try a little advertising and

see how it goes.

>> Congratulations, man. You have done so

much. People love you. People look up to

you.

>> Kevin Praath there, financial analyst

and YouTuber. Meet Kevin. Always great

to get your take.