Critical Economic Data | Jerome Powell & Recession.

economic data that we've got to talk

about. Jobs data that came out this last

week, something unique inside of the

data and the impact of student loan

debt. It is a Saturday. There is

extremely little news outside of this.

from a Tesla robo taxi tire apparently

touching a car door and people calling

it the first robo taxi accident which

seems like a ridiculous joke to the

front pages of bloomberg.com talking

about butter prices going up because

well that's now affecting kitchens and

croissant prices and Fox News is

covering sharks in the water because

there's so little going on today. So

we'll just talk about some economic

data. So uh first on jobs uh ING so a

they predict that we might actually end

up getting to a place where we only need

50 to 60,000 jobs per month to keep the

unemployment rate stable. Now why is

this interesting and why is it unique?

Uh well, what's interesting and unique

about this is usually when we get under

about 70,000 in the jobs report, we

worry that those are actually

recessionary numbers because when we get

revisions that come in, we'll end up

revising to the negative side. Uh

Barons, which I got mad because there

was so little going on uh with news that

I threw it. So, I don't think I can find

it. Didn't I? Oh, I think I ripped the

piece. Oh, I threw it away. The Baron's

article where they were started touching

on this. I they had a really interesting

start. It's from this Baron's weekend

edition. You know, I always try to grab

the paper before I leave. I'm about to

go fly to do some house hack business,

but I'm also towing the kids along

because we're going to go play airsoft.

Uh but uh he starts off with there are

lies, damned lies, and then there are

government statistics. Apparently,

that's a Mark Twain quote. And I'm like

spot on. Uh but anyway, uh this 50 to 60

number is really interesting because if

that means that's all we need to keep

the unemployment rate stable, then we're

actually going to be in this really

weird place in the second half of the

year where the unemployment rate is

stable, but the job numbers are

collapsing. Now, in the Barons piece,

one of the reasons they say that the

jobs report could actually fall or or

like these numbers could actually fall

is because we're seeing a slip in

aggregate hours worked, which is not

ideal. uh you're seeing not only

aggregate hours but weekly hours

declining to levels below where we were

in 2019. Not great for GDP, not great

sort of for an expanding economy.

Clearly evidence of a slowing economy

but not crashing economy. Uh and uh the

Baron's author, he argues that we're

seeing uh teachers that stayed at work

longer this year, which could have hit

this jobs report to the delta of about

120,000 level, which which is a lot. You

know, if even half of those teachers

stayed at work, that'd be 140,000 jobs

over count versus an 80,000 jobs report,

which would have been a lot more nervous

for markets. I have to say though, when

we look at delinquencies, credit card

delinquencies are actually peaking,

which is crazy because everybody's been

talking about these rising delinquency

levels, but we're actually peaking out

in 2025 on some of these seriously

delinquent levels, which is you got

either a flattening or a peaking out,

which is actually a good sign of a

strengthening economy, right? Uh right

here you have uh that's credit cards.

Here you have auto loans transitioning

to serious delinquencies. Yes, you have

this 40 to 49 age group right here still

rising as well as this 30 to 39 group

aging. But over here the older

demographics and the younger

demographics are actually seeing their

numbers sort of peter out and flatten.

So you're not like seeing this

skyrocketing of a collapsing economy.

And it's probably because the labor

market is so strong. Now keep in mind, I

mean we all know this, but the labor

market is like the last thing to turn

dirty. You know, even in the I uh ING

piece, they they mention like be careful

looking for the labor market. In fact,

there's another ING piece here where

they talk about, hey, issues we have

coming for the economy are tariffs

obviously, but does it really matter

because, you know, tariffs take so long

to show up? Uh and they talk about how

last time it took 3 months for tariff

data to actually show up in our

inflationary reports. They actually

think that we are going to see more

inflation in the second half. I totally

disagree with them, but whatever. Uh,

however, they say, hey, it might take

more than 3 months this time because so

many companies saw these tariffs coming

and everybody stocked up so much

inventory, so it might take more than 3

months. But they do make a very, you

know, important uh reiteration here that

jobs reports don't point to a falling

out of the labor market, but remember,

usually the last place economic damage

shows up is in the labor market. So,

they actually think markets are being a

little bit too complacent and more pain

is coming in the second half of the

year. But again, like what data can we

point to to say that we're actually

really caring about these tariffs? They

say, "Oh, well, it's the, you know, July

9th deadline." Really, that's already

been delayed to August 1st. Donald

Trump's actually kind of playing this

perfectly for markets by just buttering

this out. Delay, delay, delay. uh then

oh we'll have a 90-day and then we'll

send letters but now we're sending

letters that say we won't actually

implement the tariffs until August 1st.

You just kind of keep kicking the can

down the road. So it's like actually

great for the economy because in a weird

way what you've done is you've motivated

more purchasing. I know people who've

been driving the same car for 7 to 10

years and they went and bought a new car

because they were afraid of tariffs. So,

in a weird way, like Trump's kind of

like tariff drama has just motivated the

economy. Uh, now we'll see what happens

with Q3 estimates, but so far Q2 GDP

estimates from the Atlanta Fed are just

kicking butt. You know, 2.6%. This is

fantastic. Well offset some of the

negatives that we had in Q1. And on top

of this, we got to talk about that uh

student loan impact. I'll just give you

kind of the quick bottom line on this

because uh the the Apollo piece was like

80 pages long, maybe not that long. It's

like 40 pages long on this. Some

interesting things, student loan

delinquencies are very high in the

south. You could see that in this red

territory. This is where you have the

highest student loan delinquencies and

then green the lowest which would be

like center north, northeast, west, and

then Florida as well as your Carolinas.

Uh household debt, this was huge. Like

in my opinion, this was a fantastically

bullish chart for the US economy.

Household debt levels are back to 1999

levels, which is uh evidenced roughly by

this red line right here. I didn't want

to cover up that, so I did put it

slightly below. And household debt

levels are plummeting as a percentage of

disposable income, lower than we were in

in 2019, which is also bullish for the

economy. Remember, these notes are also

in the Meet Kevin app. If you want to

see them, download the Meet Kevin app uh

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useful. But anyway, getting to the

student loan stuff here. You can see the

demographic differences. Lowest uh

percentage of delinquencies or people

behind on student loan payments amongst

Asian and white. Asians like like twice

as many white delinquent compared to

Asian and then the highest delinquency

rates amongst black and Hispanic. Uh and

if we look at which part of that could

be due to the concentration of poverty.

If you want to know my opinion on like

poverty and race because I'm not going

to do that in this video. You could

literally just type into YouTube, meet

Kevin, black versus white, and I'm just

really blunt about the differences uh in

in you know, income and the

concentration of poverty and and issues

that that you know we face socio

socioeconomically. You could learn about

that if you care about it. Anyway, here

as a share of total consumer spending by

income, you could see that uh obviously

the highest quintile spends the most

money in our economy. But I wrote some

notes over here just to kind of come up

with some quick math because Apollo

didn't do it. So it is my math. But

about 7% of the workforce has to deal

with student loans. Our consumer economy

is about $18 trillion which means about

1 to two point one to$1.2 trillion of

the workforce economy is affected by

student loans. But obviously their

spending is not going to drop to zero.

So if their spending declines 10% due to

student loans, you'd have an impact of

about hundred billion. If their spending

declines 20%, you'd have an impact of

about $200 billion. But the point is,

the big beautiful bill probably grows

the economy way more than this anyway.

So, the big beautiful bill likely more

than offsets any of the damage of

consumers having to go back and spend.

So, you know, too soon to say that

consumer spending is like in the fall

off a cliff or or, you know, because of

student loan payments resuming or

whatever. uh which we found was sort of

an interesting number along with this

sort of 50 to 60 to keep the

unemployment rate stable. Part of this

is because of so many people leaving the

workforce including migrant workers. In

fact, boomers have left the workforce.

We're at a 19-year low in boomer

participation and our foreign labor

force is down uh 1.14

million since March, which is pretty

remarkable. Uh, so anyway, I got to go

uh do some house hack work and we'll do

some more open housing tomorrow for

house hack as well. Maybe you can follow

me on Instagram and I'll actually post

some stories. Uh, and uh I guess if you

want like a freebie, I'll show you uh a

quick little stall video if you want.

Uh, which I think is kind of fun. Uh, I

I wanted to make this its own video, but

I figure as a freebie, as like a free

bonus for you making it to the end of

the this little segment here, this is

just what it looks like when somebody

holds an iPhone and watches me stall my

plane. Stalling a jet is, you know,

actually surprisingly similar to

stalling a propeller plane.

Stall. Stall.

Stall. Stall.

Stall. Stall. There it is.

Power. Stall. Stall.

So, that's just an example for you.

That's uh facing the uh uh what's it

called? We were facing the water over

there. And then I'm pretty sure I pull

off another one uh in a little bit. Is

it over here? Yeah. Here's here's

another one if you want to see it. But

basically, we just pitch up and the

hydraulic pusher pushes the plane down.

You can see my speed plummeting over

here. So, we try to maintain altitude.

You pull the power out and just pitch

up, baby. Pitch up. This, I'm pretty

sure, is our clean stall. Stall. Stall.

No. Gears down on this. Gear down. Flaps

down on this.

Stall. Stall.

Stall. Stall.

Come on, baby. It doesn't want to stall.

Stall. No, it's resetting. It's so hard

to stall it. I got to pull it back more.

Stall. Stall. Push. Baby.

floating at 85 knots. There we go.

Stall. Stall.

[Music]

Anyway, uh, and obviously I'm still

alive.

Anyway, free little bonus there. So, uh,

happy Saturday. But if any of that makes

you nervous and it makes you feel like

you want to get life insurance,

remember, you could always get life

insurance at metaven.com/life.

It's a paid partner of the channel. met

kevvin.com/life. That's me. Yeah,

there's an e missing. Mete cuz we met

now, right? mattke.com/life.

You can sign up in as little as 5

minutes. It's what Lauren and I have. Uh

it's great. You can Apple pay, Android

pay for it, and we'll see you on the

next one. 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.