We ARE too LATE [Fed]

Well, the Trump show Myin had a great

interview with Sarah Eisen this morning.

I loved it. We watched almost every

single minute of it and wow, I got to

give you a breakdown of exactly what he

just said, as well as provide a little

bit of a risk for gold. Uh there are

some bearish murmurings around the

direction of gold. Spoiler alert, it's

on screen right here. We'll talk about

gold in just a moment. But let's talk

about Myin. So, Myron says that the left

tail is getting fatter. Now, this guy

speaks in tongue. He speaks in a really

complicated manner. It's really honestly

not meant to be understood by anyone. I

think there's a word for that, like

arcane or just like annoying. But

anyway, as much as when he first came on

the scene, I just called him a Trump

shill. I have to say he's he's turned

out to be pretty damn good, and I kind

of like him, and I kind of hope he

doesn't leave the Fed. I actually think

he'd be a really good J. how

replacement, but he ain't in the running

for that. Uh, you got to get more of a

wet blanket in there so they can do what

Trump wants. This guy's good. So, he

says the downside risks are now growing

because of the trade war that we have

with China, but we can fix it. We can

fix it by lowering rates a lot. He's

basically telling us that the main thing

he's paying attention to is what's going

on with rental inflation because it

makes up 25% of

personal consumption expenditures, which

is the Fed's preferred inflation gauge,

and 33% 34% of CPI. And he tells us that

if you look at where market rents are,

they've been relatively stable. And when

the lagging owner's equivalent rent data

catches up to this, we should have

virtually zero shelter inflation. He

also says we don't see any signs of

rents skyrocketing anywhere. And mind

you, I completely agree with him. No

signs of rents skyrocketing anywhere,

which is really exciting and a really

good thing. So, I'm jumping up and down

about that and exciting about that

because it means lower inflation, which

you might think, "Oh, but Kevin, you

know, you guys should be liking rents

going up." No, no, no, no. I'm I'm all

for making sure this economy doesn't go

into a recession. Lower rates via lower

rental inflation is a great way to do it

because it'll drive rents and or it'll

drive yields down on 10-year Treasury or

mortgage rates. It'll actually increase

housing affordability, which is actually

great for the housing market. Now, think

about what else Myron just said. Myron

said that usually

in a low population growth environment,

the neutral rate should be substantially

lower. Basically, we should cut faster

because the neutral rate should be even

lower because population growth is

potentially turning negative. Now he

says the reason we might be stuck in a

more restrictive position is because we

just came out of the craziest like weird

like up and down in population. We had

population spike like crazy postcoid and

open border policies and now population

growth is going negative under closed

border policies and deportations. So you

have this complete flip-flop that

usually would happen over decades that

happened in less than five years. And so

his view is that high population growth

is artificially leaving some members of

the Fed keeping rates higher and that we

really need to get rates lower, even

lower than people forecast. He says if

we get rates lower fast, then we can

actually see the unemployment rate go

down, which is fantastic. That's exactly

what we want. And that's really exciting

because if we can get the unemployment

rate to go down, then even if we do see

a little bit of an increase in layoffs,

it could be absorbed essentially.

Consider for a moment what's going on at

a lot of companies. A lot of companies.

Like look at what Amazon just announced.

Amazon just announced that, hey, we're

going to lay off 15% of our human

resources staff. Now, why do you think

they're doing that? Come on. It's AI.

So, we know people are getting kicked

out. We know people are getting a kick

in the butt and they're going to have to

go out in the labor market. We know

layoffs are quietly ramping up. And if

they all hit at the same time, it's

going to be a big poop or duper. This is

why it's so important the Fed go dovish.

And I think my might be one of the

reasons why we got Powell to flip. Now,

we did get a heads up on what the Beige

Book is going to say, which is really

exciting. the beige book and and what

happened with Powell yesterday is why we

made a couple calls this morning in the

alpha report. One of the calls we made

was Tesla up. The second call we made

was MP material down. Remember, you can

get the alpha report and the me Kevin

membership every single day by going to

mekevin.com.

But MP material clear as day rejection

yet again at 100. So keep an eye on that

one. Free point out. But the Beige Book

comes out at 11 this morning. the Beige

Book. JPAL already told us what the

Beige Book is going to tell us. And it

creates a little bit of maybe good,

maybe bad, and some updates regarding

gold, which we're going to talk about

both of those. But first, I want to just

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channel. Uh so now that said, let's talk

about this gold warning because there's

a big gold warning right now. And uh

this is where you've got a lot of people

saying, "Hey, Powell tells us that

things are good, but gold is saying

things are not good." That's something

to remember is gold is skyrocketing at

at, you know, levels that we just

generally don't see. Look at this. This

right here was in the uh in the turn of

the 70s to the early 80s we got this

vertical deploy development in gold

prices. Uh and they as soon as we went

vertical that was the top the vertical

aspect the slope of the line going

vertical that was the top and so you can

see the slope of the line here is is

approaching vertical.

Uh and then of course we had a top. Now,

this top right here in the '8s took 30

years to recover from. 30 years to

recover from. So, you if you bought at

the peak, it took 30 years for you to

break even. Then we had this happen

again in 2011. We went vertical after

the financial crisis, which is weird

because here you went vertical before

the double dip uh Vulkar recessions.

Here you went vertical after the great

financial crisis. You know, gold had a

spike going into the recession and then

fell during the recession. But it was

actually in the uncertainty after the

recession that gold went vertical and

then it took, if you bought at the top,

it took 10 more years to break even.

Now, you look at gold and it's got the

same vertical pattern. Now, it's

unclear. Is this vertical pattern

happening because we're about to go into

a recession just like the early 80s or

is the vertical pattern happening

because we're coming out of a

recessionary era and you know, we're

about to soft land, but there's still so

much uncertainty. Who knows? But what we

do know is that gold falls as

uncertainty fades. So, I would make the

argument that if you think the economy

is going to go into a recession, maybe

gold's still got some room to go. If you

think the economy is going to soft land,

you might be knocking on the door of

tops that we might not see again for

decades in gold. Now, that's not to be

super bearish. It's just to basically

say like you kind of got to pick your

side. Like what side are you on? The

uncertainty side or no uncertainty side?

Now, keeping in mind this, remember what

Powell told us yesterday about the Beige

Book? Powell already told us about the

Beige book. because Powell already told

us about the beige book. I when I when I

turned on my live stream this morning,

I'm like, "Hey, you know, I'm actually

bullish on on what Powell told us is

coming today." Uh, and therefore, I'm

excited about, you know, the broader

market. I mean, look at the cues from

pre-market. We're well up from

pre-market. Tesla's up. MP materials

down. These are the things we talked

about in the alpha report this morning.

But one of the reasons is Powell already

told us that the beige book is at least

as strong as the data that we saw in

September and the economy today again is

either at least as strong or stronger

than what we saw then. Now that doesn't

mean we are going to have a

normalization of the beverage curve uh

which is bad for layoffs and the

unemployment rate but remember what my

says. Myin actually says, "Listen, if we

start acting and we start cutting, we

are going to remove the shock risks from

the economy and we could actually

softland." So that means you've got

Byron in there really drilling for lower

rates. Like get rates down, get rates

down, get rates down. I don't know. I

want to be very clear about this. Okay?

I have no idea if we're going to soft

land or go into a recession. I'm telling

you, I'm like I'm like right here on

this line and it's like which way is the

wind gonna blow? Are we gonna go h

recession? It's like an arm wrestle's

happening, you know, or soft landing. I

don't know.

But we are at a shockprone position.

Myin tells us we are shockprone because

of high rates. There are two other

reasons we are shockrone. Number one,

the 102 yield curve being over 50 and

then obviously the potential for a

private credit bubble and a BNPL bubble.

not great. Those are things that could

contribute to a real shock. We saw

leverage get flushed out of the system

on Friday. Although that Binance

situation was a little excessive, it was

probably fraudulent. But then again, you

many of you already know my opinions on

Binance. I've been on Binance

since before it was popular to dump on

Binance.

Uh but anyway, you know, the 102 yield

curve is another issue that makes a

shock prone. And then obviously the

private credit and buy now pay later

bubble in my opinion that's brewing.

It's it's just a matter of time. I'm not

even mentioning AI in this. But these

are real shockprone issues. So I think

my is right on when he suggests we got

to get rates lower. This is bullish by

the way for rate plays. This is bullish

for interest rates down over the next

two years. I think you have to be

cautious going, "Oh, I'm going to, you

know, go crazy into uh some kind of like

options betting that in the short term

rates are going to plummet." I think

patience is more important here. Uh and

I've made that mistake in the past where

I've been too impatient, but I think the

trend is very very clear. And I think

that's why we're start I mean we're

already starting to see a surge in

refinance applications or purchase

applications in real estate. It's just a

matter of time before as rates actually

come down. I mean, here you go. Here's

the Goldman Sachs piece on this.

Mortgage purchase applications rise 14%

year-over-year. Uh, refinance

applications rise 18% year-over-year.

Look at the blue line right here. Let me

try to point this out because it's

honestly it's so tiny. It's a little

hard to see. Uh, okay. Stupid document.

Kind of hate it when they do that to me.

This like, oh, the PDF is locked. You

need to duplicate it. Shut up.

there. Okay. So, right here you could

see purchase applications. You could see

that uptick. It's like barely starting

to uptick, right? Imagine you get back

to this era over here. I mean, one in

five mortgages right now sits over 6%.

That's insane. That's very expensive.

So, the refinancing boom is going to

come eventually. We're just now starting

that trend up. So, that's just a matter

of time. And Myin's a perfect shill to

keep pushing for lower rates. But, I

think he's right. You know, I think he's

right about that. And then over here,

you've got those purchase applications

popping up, which if you look

historically where we sit on purchase

mortgage applications, look at the line.

Let's make this a little thinner right

here. Let's draw this line. Oh, come on,

buddy. Let's get a little bit of a

thinner line here. There we go. Yeah,

look at look at where we sit right now.

We're like at the bottom of purchase

applications volumes over here. You

know, it almost it's like does it make

sense at this point to say, "Hey, take

your money out of gold and throw it into

mortgage plays, you know, interest rate

sensitives." I mean, look at how

historically low we sit on both purchase

and oh, this one's a p a refinance over

here. Whatever. This one's refinance.

This one's purchase. But anyway, look,

like that's insanely low where where we

sit. And so, I think Goldman has a very

very uh valid chart here to pay

attention to. But I take a little

screenshot of that, steal that. It's

fantastic. So, shout out to Goldman

there. But uh yeah, I mean the these are

the this is all a big deal. And so good

on Myin. I mean fantastic interview. And

he really makes it clear that Powell,

you need to get off your ass and start

stimulating. I got to stop saying bad

words. You got to get off your poopy

dupy. The the thing is uh I think Myin

showing up at the Fed actually somewhat

helped Powell turn dovish here. You

know, Powell didn't say much in the Q&A

yesterday, but in his prepared remarks,

him going, "Listen, you know, we're

going to turn off the vacuum cleaner

because it's time to, you know, start

supporting the economy again.

Hopefully, it's not too late, but it's

bullish." And remember, gold down as

uncertainty goes down. Uh anyway, so

again, shout out to uh investing.com

and their investing pro sale. So check

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I'll go throw that QR code uh up on

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remember you know we we can utilize the

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uh with what we do in the Meet Kevin

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There's one I wanted to add to this

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dude, it's up 50% since we started

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Anyway, you get all the courses, you get

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>> 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.