The Fed'S Disaster is WORSE Than Feared | CRITICAL WARNING

you are not going to want to miss the

information we're talking about in this

video because this is a total Game

Changer and it's not what you're

expecting probably at least see the

market has rallied 8 days in a row had

we closed green today we would have had

nine straight green days in a row

something that has not happened since a

market rally in 2004 coming out of the

do bub collapse well today the rally

failed its ninth day and the questions

we have now well come down to a lot of

problems one what's this Bureau of Labor

Statistics labor revision everyone's

talking about are we going into a

recession or are we in a recession

where's Kevin on the bare bull scale I

mean the Market's been going up the last

eight days so surely he's going to

flip-flop to Bull right well we're going

to talk about that in this video is the

market pricing in any quantitative

easing or a stimulative Fed at all and

will the Federal Reserve go with a 50 BP

cut or frankly has the FED already gone

too far we're going to talk about all of

that and much more in this video and boy

there's some big big things you want to

take notes on on this one but first I

have to get it out of the way like this

stain on the jacket over here it'll wash

away I've got this million dooll trade

that I've built up and if you want to

know exactly why I built it up and what

it is actually two trades one part and

another part both of them are equally

worth over a million dollars and their

trades for the second half of this year

they consider them both Hedges and

frankly a long-term investment they're

not puts don't worry uh but anyway if

you want to learn more about those and

my strategies around those why I'm

looking at these make sure you're part

of the courses on building your wealth

we've got a coupon code expiring this

Friday for Jackson Hole so it's a

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probably a couple weeks here one to two

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so just wanted to mention There's an

opportunity coming up for Jackson Hole

and that's it for the mention for now

let's hop on to the content the research

institute mizuo is nervous about

employment they see slowing hiring soft

household employment data softening

payroll employment and Rising

unemployment and their question now is

how much is inflation going to weak and

how much is the jobs Market going to

weaken and their answer a lot and a lot

and their critical takeaway in their

article was that the Federal Reserve is

priced right now for a quote decent

easing cycle that would only take the

Federal Reserve to the top of the

neutral end of where the Federal Reserve

rates might actually end up in the long

term and this they say is actually

somewhat problematic I want you to to

see this I'm going to throw this up on

screen right here this is a screenshot

of what they're saying and I wrote on

the left basically no stimulus priced in

and I'm not talking about stimulus

stimulus checks I'm talking about the

fact that the FED is restrictive right

now and the market is only pricing in

the FED going to neutral well if the FED

needs to go stimulative rates can fall a

lot further than currently priced and

and this in their opinion suggests that

investors should continue to buy backups

in Market rates now what the heck are

those well backups and Market rates are

basically a way of saying hey maybe you

want to buy treasury bonds or something

that's going to lock you into higher

yields because if the FED needs to go to

well frankly just neutral cool that's

priced in but if they need to price in

any amount of easing that hasn't been

done yet and so on top of this fear

about the employment cycle rolling over

we've got big employment data tomorrow

big employment data tomorrow that quite

frankly is probably going to show the

economy is a lot weaker than we had

originally thought on Benchmark

revisions this is what they're called

Bureau of Labor Statistics Benchmark

revisions they come out at 10:00 a.m. on

uh the morning of what do we got here

Wednesday the

21st Mizu suggests we already have most

of the information it's not going to be

a huge surprise that the revision is

going to be massively to the downside in

other words we created way fewer jobs

than we actually were told we created

under the Biden Administration in the

last year not a surprise and it's not

designed to get political it's just the

way it works except these revisions are

probably going to be in the magnitude of

1991 or

2009 both recessionary periods Goldman

Sachs thinks the number is going to come

in around 600,000 to a million Mizu

thinks the number will come in as high

as 1.1 million in terms of a negative

jobs revision so in other words you take

the total bundle of all the jobs we

created over the last year and now take

out up to 1.1 million or nearly a

100,000 fewer jobs per month that would

be in line with the weaker household

survey it's why we keep seeing that

spread between the payroll survey which

asks bosses how many employees they have

and the household survey which asks

household how like do they have a job or

not and and those surveys have kind of

been widening suggesting there's

something wrong with the data well these

revisions might finally kill the charade

at least for now now a lot of people

think the gig is up or The Jig Is up and

we're going to see some really bad

potentially recession fear inducing

numbers at 7:00 a.m. California time

tomorrow or 10 a.m. it's interesting it

gives you 30 minutes of trading right

before that or 10 a.m. uh Eastern Time

Goldman though doesn't actually think

it'll be that bad bad because Goldman

thinks the downward revision will be

overstated mostly because it might not

count all of the work authorized illegal

immigrants now adding to jobs though I

think most Americans are going to listen

to what Goldman said and they're going

to say bro if we're now relying on

illegals with work authorization to prop

up our economy then our economy truly is

effed but anyway mizuo says that this

report tomorrow is likely to contribute

to a downside yield and curve steepening

risk now I can't give any guarantees I

have no idea what's going to happen past

performance doesn't guarantee future

results but I've got a big trade going

on this and that's uh my million dooll

trade so we'll see which way it goes if

you want to see what it is make sure you

join uh before tomorrow when that

release comes out could just go to

meetkevin.com if you need a bundle

coupon email us at uh staff

meetkevin.com this isn't like a YOLO

trade either where it's like oh yeah

it's like a Friday call option or some

YOLO that's going to go to zero this is

like this is my opinion a real trade but

anyway since there is one more

employment report for before Jackson

Hole on Friday mizuo thinks that the

Federal Reserve is actually going to

leave the door open to aggressive easing

from the fed this kind of aligns with

what ever core isi suggests which is

that we might see a Fed suggest a 50

basis point cut in the September meeting

especially since the September meeting

is also a signaling meeting where we get

the summary of economic projections

where they could give us a 25 or 50 and

potentially talk doish about the market

to really Drive yields down quickly and

aggressively it's a big trade in that

you should be seeing it loud and clearly

but anyway something to watch though is

the layoff rate okay the layoff rate is

right now still under one now don't

worry I know that doesn't really mean

anything to you right now so I'm going

to give you history historically the

layoff rate sits around 1

.2 with full employment that's your

layoff rate if hiring keeps falling

though and then all of a sudden you get

a normalization of the layoff rate in

other words hiring Falls and the layoff

rate Rises just back to normal Mizu

thinks you could see the unemployment

rate move sharply higher which would

move you into a recession notice

everything even though we've had a good

week here with lagging data unemployment

claims you know University of Michigan

sentiment PPI CPI export prices who

cares right all of this lagging data the

leading

indicators like job openings we're going

to talk about and some of the other

things you'll see in this video they're

actually weakening they make me more

bearish and there's a reason I haven't

made an economic video in four or five

days because I've been reading and

studying this every single day to put

this video together to just give you a

calm put together perspective that's

hopefully balanced I I know some of this

sounds negative initially to start with

but we're going to balance it because

this I'll show you why this could be

wrong as well but anyway Mizu says that

if the labor market weakens it would be

reasonable to assume that the Federal

Reserve is going to need to add stimulus

that is they're going to take rates

below 3% we're not going to be neutral

we're going to go way below that and the

Market's not currently pricing that in

especially since when you have the

basically jobs added level sitting

around 990,000 you're kind of looking at

periods historically that align with

either recessions or really soft labor

markets it's also worth noting that the

job openings rate that a lot of people

talk about which I will show you a

picture of right here because I keep

seeing it on X people keep posting these

job openings rates and they say oh the

last two recessions started with 8 and6

job Seekers per jobs per per Seeker

basically in other words you had way

fewer openings than you had workers well

right now we're sitting at like 1.2 so

people are like see we're not in a

recession yet but there's a problem with

this chart Publications like I can't

remember which one it was it was either

Robo bank or TS Lombard they've

suggested that the job openings rate may

be artificially High because companies

just forget to take down their old and

stale listings and the web portals

actually incentivize people not to take

down the listings because the longer

those listings are forgotten the more

profit those companies get and the job

listing websites are already getting

smoked because we have such a soft labor

market right now so they're like no no

no please don't cancel your listing we

need the money so in other words this

line could already be in a recessionary

level and and we just don't know or see

it yet because you know a we don't want

to and and B well frankly we use the

internet ironically to find jobs a lot

more today than we did yes again

ironically then in the dot bubble and in

08 everybody's got an app now to find a

job we didn't even have an app store uh

in I mean in 2008 the app store for

Apple came out in 2009 I remember it was

in the summer of 2009 is is hanging out

at Lauren's

house anyway uh this this really

suggests a downside bias to this chart

on top of that you've got BCA research

that currently thinks we could be

pricing in a yearend recession listen to

this ahead of recessions firms usually

reduce the pace of hiring

before they start firing the jol's

hiring rate is now well below

pre-pandemic levels see that's a leading

indicator hires tabulated by these

various different firms were down 43% in

the first 7 months of the year relative

to the same period a year ago folks a

43% decline from a year ago on top of

that the job opening rate today is flat

from its post-pandemic peak of 7.4 to

4.9% our Global investment strategy team

highlights the current pace of decline

in the job openings level at this

current Pace rather the economy will

reach the I'm just going to translate

this to English the bad point in the

beaver curve and at that point Rising

unemployment will trigger a negative

feedback loop self-fulfilling

culminating in a recession now just like

in super plain English here when people

start firing they start firing fast and

it's no surprise that Muhammad Allan is

now suggesting that expectations of

losing one's job is currently at record

high levels according to the New York

fed survey going back to

2014 Now it only goes back to 2014 so I

don't actually think that one's like

super super useful but something else

that is super super useful my opinion is

considering that well wait a minute what

could actually be contributing to

layoffs that has started occurring over

the last year oh what's this

Dennis on X brutal company's marketing

team begins using AI company realizes it

doesn't need the entire marketing team

75% of team gets laid

off these I call them AI enabled layoffs

where basically what you have are

companies that start saying okay we're

not really growing revenues as fast so

but we need to show our investors growth

so let's grow EPS in order to grow EPS

what are we going to do let's just just

lay people off because then our earnings

will look higher from our existing book

of business now we'll talk about

revenues flattening in just a moment

that part's still coming but it shows

you that uhoh yeah if you get a

self-fulfilling loop it's likely that

the productivity enhancements we've

gotten from AI could actually make

companies more interested in laying off

other people more rapidly it's not good

all right so then Mizu on inflation now

this is a really really interesting one

so this is a special little chart they

put together here and I want you to see

this red arrow right here this red arrow

points at the green line the red arrow

suggests that Trend inflation actually

started declining around the end of

2021 now this is actually crazy because

it suggests that if Trend inflation was

going down then it basically means we

had these weird little Transit

hits as to why inflation went up in 2021

and

2022 rather than sort of a long-term

Trend this is critical because a lot of

people believe we're just going to have

a second wave of inflation we're

basically screwed but the reality is if

we end up having lower Trend inflation

and all this stuff was truly transitory

then people are probably really

misposition positioning themselves and

they should be positioning themselves

for uh a recession and for deflation not

for a second wave of

inflation anyway take a look at this

demand inflation is right here where the

Green Arrow is and you can see that

demand inflation sits at just under 1%

uh the left bar left side is is just

under the 1% there uh but usually we sit

slightly under the 0% line this means

that when that blue line continues to

normalize we might actually see pce

inflation closer to 1% than 2% this is

according to Mizu I'm not making this up

this means the Federal Reserve might

actually have already overdone it

inflation might end up closer to 1% and

we'll be right back at flexible average

inflation targeting where the fed's

trying to get inflation back up again

and then we get to 0% interest rates QE

and we're right back to the bubble cycle

except a bunch of people lost all their

money in the stock market crashed on the

way down to that cut to

zero I gu I I don't want to be a bear

because I I feel like I'm like talking

down people's portfolios or whatever and

people are like oh no it's bad it's like

well as long as you don't stick your

head in the sand you know have an

opinion on it it's important uh but you

know all of this is also consistent with

what TS Lombard is seeing with European

inflation as well suggesting that

shipping rates appear to have peaked

insurance rates appear to have peaked

disinflation in core Goods has probably

reached a bottom but it's probably going

to stay around there the services uh

inflation has probably peaked out we

weaker commodity costs all these things

basically leading to fading inflationary

concerns on top of that what you're

seeing is well quite frankly earnings

estimates for S&P 500 companies

plummeting yeah not good look at the

white line the white line is the stock

price chart of the S&P

500 the Orange Line are earnings per

share projections which are plummeting

so why is the stock market still going

up as projections are plummeting fomo

well I mean that's just a theory I I I

don't know with certainty but that's

what some are thinking uh anyway uh you

know these these issues in total are

problematic already everything we've

talked about but I'm just going to add a

few more things in here startup failures

have surged by more than 60% in the past

year on top of that we have the highest

level of bankruptcies since Q2 2017 and

the highest quantity of chapter 11

filings since 2011 in the last 13 years

that's not good either oops wrong button

over there that's not good either

so if only people were potentially

starting to prepare I mean In fairness

we did get good news good news on Israel

Israel and Iran seem to have cooled

their Jets quite literally a deal with

Hamas maybe more imminent in strikes uh

we do have uh very low hedging happening

right now that could be explaining why

the market Skyrocket over the last eight

days put call ratios are at the lowest

we've seen since July of 2021 suggesting

that a lot of what we've recently seen

has been a bit of a short squeeze and

central banks are starting to stockpile

gold which might be why gold is over

$2500 which also kind of makes sense

because frankly if rates are going to

get

cut people think that the value of the

dollar which I think will fall about 10%

very soon or more uh will you know

currencies will lose value and gold

might preserve its value or if there's a

recession actually go up substantially

in value these these are all bad right I

hate to say this so now on top of all of

this we did have a foreshadowing of this

a August 5th crash and I hate saying

that because it's kind of like oh my

gosh like there was a warning sign tell

me what that warning sign is so we can

watch for new flareups Yeah we actually

covered it here on YouTube it was the

spike in the sofa rate that's the

standard overnight uh rate so for

funding rate and uh it spiked in earlier

in July and uh and it sort of you I

remember making a YouTube video on this

and I was like hm this signals liquidity

stress and potentially something bad

that's about to happen and then we had

August 5th so now I mean I didn't know

exactly what was going to happen then

obviously uh but now it's like hm okay

now you got my attention to the sofa

raate I'm going to pay attention to this

a little bit more now something else

that's also not great is the US dollar

now equals roughly as many Japanese Yen

as it did on August 5th and hedge funds

seem to be more interested in going

bullish the Yen which means as we get

rate cuts the dollar goes down the Yen

gets bought by hedge funds which I kid

you not that's literally what's

happening right now see look hedge funds

have finally turned net bullish on the

Japanese Yen so the Yen gets bought so

Yen goes up dollar gets sold dollar goes

down what gets

worse the potential carry

trade yeah so you you could potentially

be setting up yet another carry trade

disaster I I it's just H all of this in

net is just not good now I'm going to do

a quick summary of this uh and then I'm

going to leave you with some closing

thoughts here because this is a lot of

information to take in I understand that

and uh my goal is just to simplify this

as much as possible uh I do want to

quickly say that you do have Goldman

Sachs that gives you a little bit of an

alternative view I'm sorry it was

Deutsche Bank not Goldman Sachs Deutsche

Bank says companies are waiting and

seeing that yes their customers are

delaying orders or pushing out or

deferring orders they're not abandoning

or canceling those orders and Deutsche

Bank doesn't see signs of a recession

yet so this kind of your flip side

argument that things are just

normalizing that this is all just part

of the the noise and part for the course

and and you would expect all of this

noise and a

normalization that's fine and it's

entirely possible that this could just

be normalization but let's just say to

me things feel a lot worse than

normalization so what are some of my

bottom lines on all of this well first

of all maybe check out that stocks and

sight course and even though I can't

guarantee you you're going to make money

on every single trade or idea at least

you know where my head is so when you

hear or see data like this you could

look around and say okay well how is

Kevin positioning how are other people

positioning and then decide for yourself

do I want to do the opposite of Kevin do

I want to do something similar to that

or something different but take some

inspiration from it's none of this

personalized Financial advice it's just

designed to give perspective so bottom

line I'm a 2.9 on the bare bull scale

and honestly it kind of starting to lean

down not up I know it sucks to be a bear

when markets are going up

but and I mean last week's data was nice

but the anchor here is still heavily in

recessionary water mostly thanks to

declining leading indicators on jobs

declining growth Revenue expectations

we've seen those turn flat AI enabled

job firings to boost DPS and plummeting

job openings and higher rates when the

joblessness hits it'll hit fast first

slowly and then all at once the faster

the Federal Reserve can react great but

remember when the FED hit us with

interest rate increases there was a lag

what do you think there's going to be on

the way down another lag good luck I

love you all and I wish you the best

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 it Go congratulations man you have

done so much people love you people look

up to you Kevin PA there financial

analyst and YouTuber meet Kevin always

great to get your

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