The Fed's Great Reset JUST got EVEN Worse | The Coming Depression.

Larry Summers says the risks facing our

economy are like those that faced Us in

the summer of 2007 calling for increased

anxiety being justified as we

potentially walk into a 2008 and we

thought the worst was already behind us

can it go lower

yes is it going lower yes 90 percent of

s p 500 stocks today are declining the

NASDAQ just fell under its 200-day

moving average and in this video we're

going to discuss exactly why what's

going on what's causing the Carnage in

the markets and am I selling am I

leaving am I flip-flopping

or am I just here to remind you that if

you want a free Bank of America stock

you can get a free Bank of America stock

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Friday

all right folks let's get into what's

happening first we're going to talk

about the economy then we're going to

talk about the fed and we're going to

talk about how to save this potential

disaster because everything relates to

the fed and its great reset that is

worsening but I want to start by

touching on the actual economy because

this morning in my course member live

stream I asked course members do you

remember it I want to ask the same of

you do you remember when back in January

in February I was called Mr Fudd for

bringing up every earnings call that I

could showing how every single company

was complaining well maybe not

complaining I should say bragging about

having a really big PP that is a really

big amount of purchasing power do you

remember that do you remember me saying

look at all these companies talking

about how they can raise prices to

offset inflation because they have very

large purchasing power they've got large

PP

well these peepees are now shrinking and

instead are turning into a new form of

pp called pricing pressure instead of

pricing power we're starting to see

pricing pressure consider this wind

Resorts has seen a collapse of Chinese

gambling Revenue to the tune of 90 and

we're expected to stay at 90 percent

declines or so basically 10 to 11

percent of gambling revenue for Macau

for the rest of the year we're starting

to see an earnings recession China is

just way ahead of us but this isn't even

a video about China so I figured rather

than just considering China what can we

do to look at some recent data that just

came out at the start of earnings season

you know the afternoon of September 27th

and see how every day America is

actually starting to see the waning of

pricing pressure

while I did nothing other than going

directly to the earnings report for

Cracker Barrel yes I kid you not I went

to the Cracker Barrel earnings report

and we went through it with chorus

members this morning to understand

what's happening to folks and there are

a few reasons for that first of all

Boomers and matures own a lot of real

estate in fact they own real estate at

twice the rate of Millennials and

Boomers and matures they use that word

okay it's really weird I highlighted

yellow there okay that's theirs Boomers

and matures apparently are holding back

visits to even Cracker Barrel they're

spending less money and when boomers are

spending less money at Cracker Barrel

you know we're starting to have the

start to a bad earnings season here but

it's not just that it's the shrinking of

PP due to softer consumer demand higher

costs and now instead of talking about

how much pricing power we could pass on

we have companies saying hey we're

evaluating our cost recovery against the

potential impact on the value perception

and guest visitation okay this is the

kind of stuff that we talk about in the

course of live streams when we go deep

it's not just Cracker Barrel okay but

when we go deep into companies and we

actually see uh oh we're starting to see

a transition and that's what we're

starting to see in earnings reports and

earnings call a transition in the

economy to one where we're worried about

inflation for longer where companies are

telling us we don't actually see job

inflation going down if anything we see

wage inflation continuing to go up and

we still don't have certainty as to when

inflation is going to go down but we're

starting to see demand go down it's a

trifecta of Hell okay higher wages

higher prices lower earnings so in case

you're wondering why stocks are going

down you need to look no further than

Cracker Barrel but the good news is you

can now get beer and wine at Cracker

Barrel and they say they are now all in

on culinary Innovation and no this is

not sponsored by Cracker Barrel

uh okay but seriously

this is bad and this is just the

beginning of earnings season

don't believe me look at what happened

with CarMax today CarMax is down 23 on

what Bloomberg is calling a horrendous

Miss

wiping out over 2.3 billion dollars in

market cap like that could you imagine

losing 2.3 billion dollars like that Q2

missed so bad

a lot of it is because of a

substantially low Automotive commute

consumer confidence uh right now and in

fact I made a video just the other day

about Tesla and I talked about how we're

suffering from potentially or we're

going to suffer from a potentially

dangerous recession in autos

I showed charts I show data about the

recession that we're facing at autos and

how this sort of pain is likely and sure

enough Here Comes CarMax this morning

warning about low consumer confidence

their EPS came in at nearly half of the

consensus at just 79 cents versus an

expectation of 1.4 dollars with comp

sales down 6.3 percent year over year

it's bad

the earnings season is starting bad and

the stock market is preparing but it's

not just that it's that at the same time

as we're getting this bad news you're

getting folks over at the FED laughing

in our face I kid you not they're

laughing at our face you have people

like Bullard Mr James Bullard of the FED

saying things like markets are finally

making the right interpretation they're

implying they like the pain they're

seeing they're implying this is what

needs to happen notice how every time we

get a little bit of a bull rally they

come out more aggressive

they Crush every single bull market

recovery that we have in 2022. every

single time things start going up they

come out and start pooping on it to send

things right back down because they're

trying to destroy our wealth when they

destroy our wealth we'll spend less

money when we spend less money inflation

will go down and then our economic

Financial well our financial structures

won't collapse

kind of like what we're already starting

to worry about in the fifth largest

economy in the world the United Kingdom

watch my video this morning that I made

where I break down how near collapse the

United Kingdom actually was

just crazy absolutely crazy we're not

even talking about China here yet which

is the second largest economy in the

world they're already in collapse all

right that's complete disaster but

Bullard this morning says that markets

are finally appreciating the fair amount

of additional moves and interest rate

hikes that we have to provide and

yesterday Neil kashikari from the FED

came out and said it would be a mistake

to reduce too early delaying prospects

of a Fed u-turn

markets this summer were pricing in this

cherry-picked idea that we were going to

have a U-turn in September I covered it

on the channel I'm like oh Market's sick

we're gonna have a U-turn in September I

don't know let's see hopefully we get

inflation to come down otherwise we're

screwed inflation didn't come down

inflation got worse

not only did inflation get worse and all

essentially measures of inflation

broadened but now we're just getting

truly hellish data out of countries like

Germany Germany expected 10.2 inflation

this morning and they got

10.9 almost 11 inflation which is really

bad for what the forecast is for the ECB

the forecast is 9.7 that'll probably

come in at double digits too at the same

time Chancellor Olaf Schultz set out a

new 200 billion dollar stimulus package

to help reduce the impacts of inflation

on Energy prices this is the third or

fourth package now I've lost count

they're calling this the defensive

Shield they are instituting a gas price

break by cutting sales tax on fuel from

19 to 7 percent

they plan to run these cuts through 2024

with expanded electricity subsidies and

funding for nuclear plants the problem

here is you have to think about this

Europe has to rebuild their electrical

infrastructure and their natural gas

infrastructure because of Russia so it's

not just oh no we have an interruption

prices are going up it's the fact that

we have to spend money on infrastructure

which is stimulative remember when we

stimulate or want to stimulate what do

we do we spend money on stuff we give

people jobs we build Bridges and

highways nuclear power plants whatever

look at what China's doing they're

trying to stimulate what do they do they

start at 53

000 infrastructure projects in 2022 here

this year alone year today

that's supposed to be stimulative but

the problem is when you have inflation

at 11 and you're stimulating all you're

going to do even if you need to do it

because you need energy Independence you

can't rely on Russia anymore all you're

going to do is make inflation worse for

longer

so to me

this 200 billion Euro stimulus package

and an energy package in Europe on top

of basically 11 inflation following a 65

billion Euro package and following two

more packages before that to me sounds a

lot like Nancy Pelosi going we need a

three trillion dollar infrastructure and

stimulus plan because package one two

three three and a half and four weren't

enough

it's crazy and it's very stimulative and

unfortunately that just means more

inflation for longer

and that means our economy at the same

time continues to suffer

GDP this morning came in at an

annualized decline of negative

0.6 that was the expectation we thought

it was going to decline at negative

point six percent and it did

so anybody who says we're not in a

recession at this point apparently isn't

paying attention to the technical

definition of a recession which means q1

negative Q2 negative unless we revise

those higher Q3 is probably going to be

negative as well we're potentially going

to walk into a depression when we have a

recession in excess of four to six

quarters in a row we're on three

and so even though you have folks over

at the FED going no no we don't think

we're in a recession yet sure the odds

of a recession have heightened but we

don't think there's a recession yet I

think they're smoking crack and they're

using this idea of oh there's no

recession yet as an excuse to be more

aggressive and fight inflation except

now they've changed the definition via

their great reset again they don't care

even anymore about just inflation they

still don't even know how they met want

to measure inflation but they don't even

care so much about inflation right now

what they care about right now is

crushing jobs they want to see

unemployment go up and they want to see

job openings go down because that in

their opinion is going to actually be

the conduit to get inflation down and

that's because there are other methods

of getting inflation down haven't worked

yet the problem with that is what

happened this morning well we got

another terrible jobs report and when I

mean terrible jobs report it was

actually a really good jobs report

instead of the expectation of 215 000

people losing their jobs 193 000 people

lost their jobs

that's a lot less than expected it's 22

000 fewer jobs lost than expected or

claims than expected

now the FED looks at that and says oh

Labor's still strong let's hike more in

fact James bullard's quotes this morning

were literally

unemployment claims came in super low

that was his quote and says that the job

market is extremely strong look they

right now do not want anything to be

super good or extremely strong they're

gonna Crush jobs that's their goal right

now and they're going to crush jobs at

the same time as having crushing

interest rates and at the same times

conducting quantitative tightening the

effects of quantitative tightening by

the way we have not even yet seen

quantitative tightening just began in

May

and quantitative tightening is terrible

because really what quantitative

tightening does is it means the Federal

Reserve is going to purchase fewer bonds

they're going to let Bonds mature when

Bonds mature and they don't re-buy them

what ends up happening is we have less

demand for bonds which pushes down

prices for bonds and drives up yields

that process is just beginning

this is the opposite of what we used to

have

where we were just buying as many bonds

as possible and keeping yields low and

really the problem with this is we have

a lot of debt as a country so the more

debt we have and the higher interest

rates go and the higher we have to sort

of re uh re-amortize some of this debt

that we're not rolling off because we're

not going to let everything roll off the

more expensive it is for us to actually

operate which means the less revenues

the United States or other countries end

up having to do other things

which ultimately means a weaker economy

again so all of these things are

converging in a terrible way high

interest rates High bond yields less

revenue for the government an earnings

recession because sentiment is down and

fear is down while at the same time you

have countries who can't get their act

together like the United Kingdom who are

like are we stimulating or not oh well

we're on the edge of margin calls and

Pension funds going bankrupt turn the

money printers on and oh no no we're

only going to do that for two weeks

because that's bad we don't want to

cause more inflation when the Eurozone

is basically at 10 plus inflation

this is exhausting and it's really scary

and so a lot of folks are wondering like

Kevin like like what what do you do like

what do you do in in this kind of

environment because we know that real

estate is going to get crushed that's

why I'm creating my startup house hack

not to go buy real estate right now but

to go bottom feed so we're gonna raise

money for the next few months here uh

where we'll have deadlines at the end of

each month for people who want to invest

and we're going to try to bring on

non-accredited investors as well

probably a minimum investment of

somewhere around fifteen thousand

dollars but we'll try to open that up to

non-accredited investors who have 15K to

invest and uh uh and our goal will be to

bottom feed in real estate but there is

no rush we are probably going to be in

this these doldrums for years

and so that does beg the question of

does it make sense to sit in the market

well let me give you the only piece of

good news the only piece of good news

that we have right now I hate to say it

but this is it there's no other good

news

the earnings season is going to suck I

mean sure you can get life insurance in

as little as five minutes by going back

kevin.com life you can get a free Bank

of America stock by going to the link

down below you know you you can take

advantage of the coupon code before it

expires tomorrow

but there's only one piece of good news

that's it and in my opinion this is the

only reason you would want to huddle

your stocks

and it's not Financial advice even

though I passed my test to be a

financial advisor and I'm becoming a

registered financial advisor and I'm

opening an investment advisory firm uh

for for you know some products that

we're launching which are going to be

pretty awesome it's three ETFs

um

I can't give you Financial advice

I can't solicit you to invest in house

Sac the PPM has to do that at

househack.com

I can't give you any guarantees but this

is what's giving me the only semblance

of Hope to stay in the market you ready

for this

this is it

this is it

this is it this is a chart of the

five-year Break Even index of what we

expect inflation will do

unfortunately

this lags it lags by about

four months there's a four month lag for

this

I hate to say it

but it's going to be painful until we

actually start seeing the five-year

Break Even expectations for inflation

manifest in actual inflation

we're going to keep having pain we need

to see inflation meaningfully come down

because I don't believe the FED is

actually going to be capable of getting

jobs down I don't actually think they're

going to get the unemployment rate to

rise that much because the economy

underlying even though it's going to

look like a recession because we're

going to grow less than we did in Prior

years which makes sense because we're

coming off a freaking bubble

I don't know that we're going to get the

unemployment goals the FED wants and so

that means we're going to keep having

pain until the inflation rate actually

comes down and the inflation

expectations are presently and this is

good news at literally the lowest level

we have seen in more than a year it

doesn't get any lower than this it does

not get any lower than this over the

last year

which is good

it's good that inflation expectations

are going straight down

but unfortunately guess what the FED

told us during the last fed meeting what

did Jerome Powell tell us in my opinion

nobody studies the Federal Reserve more

than I do but then again you know I'm

not trying to like Pat myself on the

back here I just I just dream about the

fed you know Jay pal and me we go back

okay he's my daddy

[Music]

Jerome Powell told us in the last

meeting

that inflation expectations are actually

good

they're a check mark

but what's more important right now is

jobs

so he's throwing cold water on this

chart because he says they got to see

job openings come down which sucks

but if this chart comes true

they'll flip flop back if we actually

get inflation to plummet over the next

six months they will flip-flop they will

talk hard right now until the numbers

come down but they will flip-flop when

inflation comes down

problem is

how long is that going to take it's

gonna be six months is it gonna be a

year is inflation gonna plummet to five

percent and then sit there for two years

that would be bad too right these

inflation expectations could imply that

inflation is going to plummet to five

percent really quickly but what if it

sits there and flat lines for a year

well then we have to deal with an

aggressive fed for a very long period of

time

which again

at the moment is terrible for stocks

but will also Crush real estate

the high 10-year treasury with mortgage

rates now averaging over 6.7 percent and

mortgage rates if you Google mortgage

rates coming in for a credit score of

740 of

7.55 per Google Now even though the

average is 6.7 the leading indicators

are suggesting 7.5 is what we would

expect for mortgage rates

real estate markets can get crushed

you're gonna Crush our wealth they will

crush our wealth through stocks and real

estate and hopefully inflation comes

down that'll create opportunities to buy

real estate and if you can't do it at

scale

I'll do it with yet how sec

but we have to go through a lot of pain

and it sucks

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and good luck out there