Fed to cut Rates to ZERO! PREPARE

oh boy oh boy oh boy the Federal Reserve

might have to cut rates all the way to

zero or negative especially based on

what Goldman Sachs just posted this is

wild now just a heads up Lauren's

driving right now so I'm in the

passenger seat and we're going to cover

this but this is wild so this topic

right now has to do with temporary labor

being a leading indicator for what's

coming and this is a really interesting

one because if right now you think yay

the yield curve uninverted don't be so

excited when the yield curve steepens

that is when the number goes bigger and

more positive we're usually in a more

painful environment look at what the

yield curve did all the way back in last

summer when we had three months of pain

you know July August September three

month of pain we had three month of

yield curve going up well now it's

breaking through positive and that's

kind of like what you saw in 07 and

leading into other recessions where when

you spike up from where we are now

positive like six bases points up to 50

it starts hurting really fast now we'll

talk about how to prepare for this but

this is a very interesting piece from

Goldman Sachs so Goldman Sachs here

suggests that temporary employment

historically serves as a leading

indicator for broader labor market

performance with the lead time a little

bit elongated this cycle potentially due

to labor hoarding however the data

they're collecting suggests that nonfarm

employment will worsen over the next

several quarters usually temporary

employment Skyrocket well I shouldn't

say Skyrocket temporary employment

employment plummets to a negative

year-over-year growth rate only in

recession that happened in 1991 and we

only went positive again after the

recession ended it happened in 2001 and

temporary employment year-over-year

plummeted negative and we only went

positive again after the recession was

over it happened in 2008 and it only

went positive again after the recession

was over and we have now been negative

since the end of

2022 which suggests that maybe because

of the AI Euphoria and that investment

that capex investment we may have

delayed the inevitable here but usually

we don't go positive again with

temporary employment till we come out of

a recession in fact you can pop over if

you want you could pull it up yourself

to the St Louis Federal Reserve uh the

Fred we like to say uh and you could

take a peek wow Tesla stock was down

8.45 today that's wild Q's down 3%

that's wild but anyway uh you could take

a peak uh at specifically this chart or

one of the charts if you want to see

them uh it it's uh I can't seem to pull

it up on my iPad right now but that's

okay uh but I was going to tell you

exactly what phrase to look for oh here

it is all employees temporary Help

Services all employees temporary Help

Services look at that chart and you can

see it only goes negative uh in

recessions and uh it's been trending

down quite a little bit here since the

end of 22 but it is usually a leading

indicator by about three to four four

quarters per Goldman Sachs of a

recession coming now why could this

potentially mean that rates have to go

down to zero or this crazy talk negative

well because Goldman a goes on to say

it's not just negative operating

leverage declining revenues declining

earnings revisions that are all leading

to additional macro uncertainty right

now and potentially hiring freezes and

then just labor hoarding your longer

term employees while getting rid of your

temporary employees to sort of try to

boost earnings and increase cash flow

but consider this generative AI is

increasingly being considered a

potential medium to longer term threat

to Staffing volumes both temporary and

permanent and this is a really

interesting thought because now you want

to think about this what happens if we

don't get a second wave of inflation and

the Federal Reserve task is not worrying

about inflation but it's rather only

worrying about jobs this could happen

because Supply chains became so darn

loose it's entirely possible that we

don't have inflation even if we go back

to quantitative easing which sounds

crazy I know but it's possible but we'll

skip the inflation argument here for a

moment and let's just focus on labor for

a moment what happens if we go through a

labor recession over the next year here

maybe even two years probably next year

you know maybe q1 Q3 somewhere in that

range of next year you go through a

labor driven

recession even coming out of that

recession you may never hire back as

many employees as youf seen hired in the

postco economy which means there are

going to be a a lot of people for a very

long time who were permanently out of

work uh and of course some of those

discouraged workers or long-term

unemployed don't uh show up in the

unemployment readings but in the near

term we could see the unemployment rate

Skyrocket and that will drive the

Federal Reserve to drive frankly rates

down to zero or potentially even

negative now you might wonder wait wait

wa wait negative that's stupid that

hasn't been done before well it actually

has been done before it's been done in

Germany and it happened in 2019 right

before the pandemic in fact if you go

back on my channel I warned about the

potential for coming negative rates in

the long-term future assuming obviously

I mean back then nobody was thinking

there was going to be a big pandemic but

absent the pandemic we were trending

towards negative rates which is crazy

because it started happening in Europe

think about what negative rates mean for

a moment they mean that hey now when you

have money sitting in a money market or

in a savings account and you're not

either investing it or deploying it you

are getting back less money after a year

than you put in so you put 1,000 bucks

in and then you end up with

$995 that's crazy that's like the

opposite of what happens when you buy

the courses on building your wealth like

the one that's expiring tonight oh

actually all the courses have a coupon

code expiring tonight those go up in

value over time which means you have to

pay more over time so consider joining

since you had lifetime access may as

well join sooner rather than later

anyway email us at staff at

meetkevin.com if you have questions but

that's over at meetkevin.com

we do have an expiring coupon tonight uh

we did have an option that doubled this

morning which was freaking sick so uh

good trading day uh but uh thank you

treasuries anyway that was great you can

watch my prior video to see more about

that one but anyway think about this for

a moment you put a th000 bucks into a

money market what if you get $995 back

oopsies that's not great after a year

you're expecting to get ,05 back you

know your principal back and $5 more

back well not if you have negative

yields and now why would that happen

well that would happen in an environment

where potentially well first things

first you'd cut all the way down to zero

then you turn on the money printer and

you try to stimulate demand uh for

people hiring but if people don't hire

because they could do more with workers

using AI or they can do more with

workers who are uh uh you know basically

just fully replaced by artificial

intelligence well then you're an

environment where oopsy doopsy you might

just never end up at the same levels of

employment as where you are now and that

sucks so the Federal Reserve might not

react to that though the Federal Reserve

might end up in a position where they

say uh no uh people are going to hire

people again of course let's just keep

rolling the money printer yes there's

always the risk that that ends up

driving inflation but I think the odds

of driving a second wave of inflation

are relatively low because of how loose

Supply chains have gotten and actually

this is a crazy thing usually one of the

big drivers of inflation is labor when

labor gets really tight it causes

inflation wages go up and then

businesses try to pass through those

wages so beyond just expanding service

capabilities through AI or not or

manufacturing capabilities or lower

freight costs or whatever beyond that

you actually think from wait a minute if

labor is less necessary then labor cost

don't go up anymore every year you end

up getting labor deflation labor

deflation means disinflation or

deflation across the board and then what

do you end up with well then you end up

with a poopy doopy situation where you

might end up with negative yields and so

this is a big warning here from Goldman

Sachs suggesting that temporary staff

indust industry Trends have historically

served as a leading indicator for

broader term labor market performance uh

with the current lead time a little bit

elongated because of the labor hoarding

we've seen But when that labor hoarding

goes away it's over it's a poopy

doopy anyway hey do you want to go to

Westlake so you can charge since this

Tesla Supercharger station is full dude

this is crazy this place is Never full

this place is Never full and even though

this place is Never full for the

superchargers was absolutely crazy is

there's not even a single Ford or rivan

or other car here it's all t Tes so what

happens when they start opening this

crap up to other companies forget

getting the charge damn it Tesla you

know I was having a debate with somebody

on uh on X somebody on X is like uh oh

you know uh the future of FSD uh is

going to be all Tesla every car in the

future will use Tesla just like Windows

inside and I'm like Windows Vista I

tried putting that the only thing

Windows Vista would load into was a sh

that's the only thing my Windows Vista

disc would load into it sucked so uh but

anyway uh no no companies realize the

way to make profit is to White Label the

software you end up using an Nvidia

Drive uh like the Orin or Thor platform

and you end up using your own wh labeled

service hey h hold on to say hey how you

doing they're all overheating like crazy

they're overheating that's like the

third one I've tried

that's crazy yeah let's go to the West

like one thank you for the heads up it

might

maybe uh oh your your car is

overheating the charger the

Chargers that's crazy okay well let's

try here that we'll try a little bit we

we're down at like 10% so

oh it's taking like three times as long

with the

heat oh it's cycling

yeah yeah makes

sense everybody's complaining about

sorry thank you for that heads

up thank you appreciate it uh everybody

in Tesla Community they're so nice

everybody's so nice but that's not good

can you back into that spot and then go

ahead and plug Us in uh and then after

you plug Us in let's see if it happens

to us but yeah I'll just make a quick

Tesla note here you know soft where is

look you know a lot of people white

label wine right what they do is they

they go to a winery and they're like hey

your wine tastes great that that's how

they can W write off their wine tasting

visits as well yeah yeah your wine

tastes great I want to put my label on

it so you make like a meat Kevin wine

and it's actually you know I don't know

some Charles River wine or whatever

right and you just slapped your label on

it they don't care because they're

selling more you know barrels of wine

and for you you get at your label on

wine you're like yes I have my own wine

brand I'm a wine

connoisseur it's it's the same thing you

just go out there and push the little

triangle button on it and it'll pop open

uh I it's um it's the same thing with

Tesla in my opinion because what's going

to end up happening is you're going to

have companies that say wh why why do I

want to use Tesla first of all Tesla

can't even get this crap working in a

cyber Tru so why am I going to use Tesla

if I could just use use the Nvidia

platform put my own labels on it

Mercedes Neo or whatever it doesn't even

have to be Nvidia it could be uh mobile

ey or whomever right uh and and they put

their own branding on it then they don't

have to pay anyone else for it uh and

boom they got their own software stack

that they can profit off of you know

even on a prior earnings call at Tesla

they said hey it's going to be even if

even if we signed an agreement today for

licensing FSD it would take three years

to show up in the cars too late man that

takes way too freaking long so uh no no

no I think uh I think there's a lot of

uh looniness uh in hopium on FSD

personally I think Tesla is a great

vehicle what they really ought to do is

not license all these freaking Chargers

to third parties what they ought to

freaking

do is sell more cars so include the FSD

for free sell more freaking Vehicles

Mass produce let's get to 10 million

vehicles of production let's expand

rather than then trying to squeeze every

penny out of the

existing and uh and let's get the

network effects of Tesla going before we

have a car accident here my goodness

this lot's turning into a crazy

craziness over here anyway don't forget

to plug your charger or plug your car in

at night we were getting our car washed

last night so I didn't plug it in like a

little dummy the rare time I got a drive

oh well I get to enjoy the supercharger

experience man I wish I could just stop

at a gas station and get myself a

monster and be

gone Lauren doesn't want to be on camera

but she's so coo today oh you know what

her face says her face right now it's

saying there's an expiring coupon code

linked down below make sure to take

advantage of it before the price goes up

it's going up at 11:59 tonight we

finally got the software working to

where it actually expires at 11:59 p.m.

California time on the dot baby they pay

once you're in forever anyway if you

like my perspective don't just come for

trade don't just come for Real Estate

analysis or macro analysis uh but come

to talk come to chill and we'd love to

see you there meetkevin.com thank you so

much uh if you want a mastermind go to

meetkevin.com Mastermind we got I think

still I think we got like one seat left

we're down to one seat uh I I saw

another sale go through so I think we

got one seat left at The Mastermind in

October uh and then uh inperson small

group entrepreneurs it's great uh and

then if you are looking for personalized

Financial advice Consulting

see what you're doing right what you're

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building Journey you could be in vo

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act.com we start the service October 1st

we'd love to see you there thanks so

much meet kevin.com for the courses bye