Jerome Powell FLIPPING | Forced Recession!!

hey everyone me kevin here so there are

two things that jerome powell just said

that in my opinion are at least slightly

cause for concern and they don't have to

do with this really cool looking blue

bar like that's what i want in my house

look at that reflection of the blue on

the ceiling there yeah that metallic

ceiling kind of cool anyway so a couple

things that are not elon that jerome

powell just said not good okay

so first thing who remembers paul

volcker right paul volcker was the guy

that when inflation was so unanchored

and so out of control in the late 70s

and early 80s that paul volcker came and

said that's it we're just going to jack

interest rates to be higher than the

rate of inflation so for example if

inflation was 14 they moved interest

rates to 15

that would be like moving

interest rates at the fed now from you

know 0.5 or 0.75 percent so under 1

up to like 9

that would be really bad we would go

into like a depression right that'd be

pretty devastating but it would also

stop inflation like instantly that's the

fed rug poll that i was worried about in

january that was going to come

well over the last three to four months

jerome powell has told us no that's not

coming well now he's saying the

following quote we're firmly committed

to bringing inflation down mind you this

was in an interview with marketplace

npr's marketplace kai rizdal

then we know that what paul volcker did

was right in his situation worth

remembering his situation was one of

unanchored inflation expectations right

now the bond market uh five-year

break-even rate has fallen 19 from its

peak in march implying that we're not

worried about runaway inflation that

inflation expectations are actually

coming down not going up and of course

they vacillate

then you have the consumer expectations

of inflation which are at you know

flat basically year over year and uh in

a three to five year horizon

so

you know these the expectations don't

align today with what happened under

paul volgar's uh administration but they

could change to that right so anyway

here's what we hear quote we know that

what paul volcker did was right in his

situation and it's something that might

turn out to be right here

oh

yeah that is like a big f like when i

heard that i'm like what

like last time jerome powell talked he

talked about how he admired paul volcker

now he's saying oh yeah paul volkering

the economy might turn out to be right

here like if you thought we were gonna

get paul volcker

you should sell everything like you just

literally short everything like the only

survival that you will have is in cash

that's it everything else just

crashes it's so bad uh but and then he

goes on to say but i don't think we know

that i think we have a lot to learn

about what the path looks like ahead

all right so that's just exactly what

markets hate right more uncertainty but

listen to this one okay this is the

second piece that was like

damn it damn it powell you're ruining us

all right so the second piece was the

following

jerome powell used to say our goal is to

get

inflation down to two percent without

causing a recession or significant

unemployment now he's revised that what

does he say now he's the following quote

our goal of course is to get inflation

back down to two percent without having

the economy go into recession or or

to put it this way the labor market

remaining fairly strong

okay we never used to have that ore

that's opening the door to well i mean

if we have a recession as long as the

labor market's good we're okay

that this is the first time that i've

seen j-pal say that

obviously right now they're on a path of

50 bp hikes but this is literally the

first time i've heard him say oh yeah

okay as as you know things can be quite

challenging right now including

orchestrating a soft landing

they say that well you know the

unemployment rate is quite high the

labor market's extremely tight inflation

is very high so it'll be challenging it

won't be easy

no one here thinks that it'll be easy

nevertheless there are pathways but

as long as we can do it without ruining

the unemployment rate worst case if we

cause a recession oh well right like i'm

imputing obviously this last couple

sentences here but

when you when you used to say without

causing a recession or high employment

or that is and high employment right and

now we're going to

or

that is let's not

cause either

you start getting a little bit concerned

that wait a minute jerome powell is now

starting to talk about his admiration

for paul volcker and saying paul volcker

in the economy might be what we have to

do here and now he's clearly or more

clearly i should say distinguishing that

well i mean basically if we end up

having a recession then as long as we

don't

you know create 10 unemployment and we

get inflation down then maybe so be it

which i mean honestly makes sense right

this is why i think we're in a recession

right now which i've been saying for for

many months now

it's that

it doesn't take much to slow the economy

down to the point where we spend just a

little bit less than we did last year

wholesale inventories uh the trade

deficit

personal consumption

all these things if just together in net

they go down

point one percent a tenth of one percent

two quarters in a row boom you're in our

session i think we're gonna be in a

recession all year long and then tucker

carlson's gonna freak out and everybody

else is gonna freak out as well it's

just my theory i don't know i could be

wrong but something i pay attention to

and these are two subtle u-turns here

from j-pal

that i don't like but what i do like

is that amazing coupon code linked down

below on everything that is on sale

right now coaching calls property

management real estate investing you

name it of course prices will be going

up

tonight well late tonight like first

thing tomorrow morning anyway thanks so

much for watching we'll see in the next

one bye