WARNING: PREPARE FOR THURSDAY! *CRITICAL*

oh boy we're going to want to buckle up

for Thursday yeah it's another report

that could really be problematic for the

stock

market let's talk about it 5:30 a.m. on

Thursday we're going to get some really

important numbers heads up we're going

on a mommy Moon trip for like the next

30 hours here to celebrate the twins

we've got coming just waiting for a

little bit of fog to clear not here but

where we're going and we're taking off

but anyway I want to talk about this

Thursday number that comes up it's the

quarterly report for GDP annualized and

the expectation right now the survey is

that it's going to come in at 4.2% this

is double the 2.1% of the prior Q2

annualized number this is a massive

number and if it come it's already

expected to come in so high if it comes

in even slightly

higher I think markets are going to send

those yields right back up we know Bill

amman's you know covered his treasury

short and all of a sudden the 10 years

down a bit you know back down to 4.85 or

whatever but we have to remember 4.85 is

still like 40 basis points higher 40 to

actually probably more like 50 50 yeah

what were you we were like 4.2 there for

a while so you're like 60 basis points

higher than where you were for a while

60 65 basis points so even after Bill

Amman says hey I'm done shorting

treasuries and we see the tenure go from

5% down to 4.85 this GDP number on

Thursday if it comes in hot and it's

already expected to come in high right

like if the expectation is 4.2 even if

it comes in at 4 it's still hot it's

like what the hell the Federal Reserve

drum pal just reiterated this last week

they said we want to see the economy

grow at below Trend to help prove or

ensure that inflation stays low now

obviously it's entirely possible we know

this we're researching this on a daily

basis at our course member live streams

or whatever uh you know what like what

we were researching this morning with

Sherwin Williams or

otherwise we know the leading indicators

of inflation are soft we know there has

been a lot of inflation but the leading

indicators are soft so what is that

potentially mean what Drome Paul says

well we want to grow at below Trend

growth well trend is 2% so that means we

need GDP to come in at you know 1 and 1

12% growth or something lower that

would hopefully give the fed the

impression that they've done enough to

slow the economy when GDP is growing at

1 and a half% some people believe that a

slower economy means less inflation I

personally believe that it's entirely

possible to have a growing economy and

low inflation as you actually encourage

Innovation and Investments some of the

things that we're seeing a lot of the

companies do right now that we're

studying is they're not cutting

investment spending yet that's how you

get a really dirty dark recession that's

how you get 2008 over again when

companies get to a level of so much fear

that they start cutting and preserving

rather than investing unfortunately

that's what Elon did right Elon pulled

the you know we're we're going to slow

walk a little bit on the permits for

Giga Mexico I think that's a massive

mistake I and we have made that clear

already but I personally think Elon

should say something like on an earning

call with like some kind of prepared

script or whatever which I don't have a

script for this but something

like since we agreed to start building

Giga Mexico economic conditions have

worsened interest rates have risen 1 and

12% or whatever it

is as a result we are approaching the

Mexican Government we're saying look in

order for us to continue building this

which we want to we want to bring these

jobs to your area we're going to need

additional support because the calculus

we used then doesn't make sense anymore

today and I think that would send a

signal to investors that look it's not

Elon who's flip-flopping on the decision

to build Giga Mexico it's economic

conditions which are harder and we are

now using that as a tool to negotiate

for the benefit of investors at Tesla

for employees of Tesla and the company

of

Tesla that's what you should be getting

from a CEO as opposed to yeah we're just

kind of going to flip-flop and slow walk

this sorry Mexican government right

right that's where you should be getting

but anyway when companies exhibit that

kind of fear the true fear that like

okay we need to cut R&D we need to cut

Investments and they go Inward and

that's the kind of GDP compression that

you get in my opinion you actually

longterm delay the slowing of inflation

you long-term delay more disinflation

what does that mean over the last 40

years we have had a deflating economy

the only reason we've had any inflation

at all is because we print money it's

all the game of Fiat okay that

encourages people taking on debt and

spending and it's good for politicians

it's all rig okay we we get

that so the problem though with these

GDP numbers is GDP numbers are already

expected to come in hot even if they

miss the downside they're still going to

come in hot it's going to send a signal

the shell shock through I think the Bond

Market and the economy of people who

aren't paying attention to these GDP

numbers that are expected to come on

Thursday and people are going to go oh

crap if GDP is annualized 4 you know2 %

or even if 4% on a miss or 4 and a half%

on a beat that means the FED has to do

more and If the Fed has to do more that

means higher rates and I think that the

numbers on Thursday could be what

actually shoot yields over 5% and it

could be painful for risk assets but

this is where it's kind of like well

what do you want I mean like on one hand

I actually think a GDP print that's

strong is good because it means you're

further away from recession look at

American Express who reported on Friday

that uh consumer consumer sales are

still like us consumer purchases are

still up 9% year-over-year well in you

know 2022 we were able to go okay sure

you're sales are up 9% but inflation is

9% well now it's like well inflation was

you know what 4 and half% so you

actually still have net growth in the

amount of money people are spending this

is weird we're supposed to be in a

recession we're supposed to be where

everybody's tightening but people still

have enough net worth to where they're

still spending on stuff so either the

recession is just delayed because of the

amount of extra money we have or we

prove to the FED that inflation is gone

with a stronger economy and it's okay to

lower rates because inflation isn't a

problem well that would be ideal the

problem is you're not going to prove to

to the FED that inflation is gone until

inflation's gone uh well at some point

they'll pull out flexible average

inflation targeting you really need the

3 month and six month and 12 month all

of those moving averages really rolling

over which I think as we get our housing

disinflation over the next 6 months

remember what the FED said said the FED

said in July most of the housing

disinflation is still ahead of us that

disinflation that's going to be great uh

and uh you know look we can talk housing

market obviously we have a deadline

November 1st for house hack and

investing in house hack uh but we'll

talk housing and just a moment let's

finish this thought so what does this

mean well I think you have a risk for

Thursday potentially sending guils High

stocks down we want to pay attention to

it I'll cover it live Thursday morning

5:30 so mark your calendar for that see

what goes on I actually prefer

personally higher GDP numbers because I

don't think inflation is going to prove

to be a long-term

problem and I would rather be further

away from recession because when people

hear oh we're officially in a recession

sometimes you can self- fulfill a worse

recession because again that's when

companies say you know we're not

investing we're not innovating anymore

for the future that's when you really

get that mindset shift that we have not

seen yet in the cycle

that's bad that's that's when things get

bad bad bad not great okay so that's

Thursday now briefly on

housing every day we're studying housing

markets in different areas and what

we're consistently finding is that price

cuts are increasing substantially for

October we have not yet seen more than

about a 5% rollover from Summer comps

like for example you look at Fort

Lauderdale which is an area I grew up in

I grew up in Broward County you look at

Broward County

uh sales prices are actually nicely up

year-over-year Florida's gotten really

good inflow of prices the question is

does that sustain well this winter will

tell us because what we're finding is

prices are already new pending sales are

already 4 to 5% lower than some of the

Peaks that we had uh this summer so is

that potentially a sign that housing is

just volatile in reaction rates of

course it is and housing is actually

going to be well not so much existing

home sales but you do get hello uh you

do get a housing uh new build

contribution to um GDP so we'll we'll

see some housing numbers in there but

that's not so useful for actual sales

prices for properties uh what's more

important though

is

realistically there they're a few paths

ahead something major breaks economy

goes into Quick recession fed Cuts rates

hopefully they can uh assuming inflation

is relatively gone that I see as mostly

unlikely then there's the possibility

that inflation rolls over very very

quickly over the next few months as

housing rental you know owners

equivalent rents come in low and you can

cut rates more quickly this leads to a

risk rally it's great for crypto it's

great for stocks with probably more

realistic is the patient approach which

is the fed's going to keep doing this I

don't know is inflation really good and

at the same time the data is like the

economy still got life in it you haven't

fully crushed it below Trend right uh

and and so you get this nervousness I

actually think this nervousness is a

fantastic time uh to build uh and so

personally what I'm doing is most of

what I'm spending money on right now is

building businesses uh whether that's

you know expanding uh what we can do

with house hack or uh hiring like for

example we're we're uh still working on

building a software Dev team if you want

to apply send an email to jobs at meet

kevin.com include a resume include a

little video we're looking for a full

stack developer uh you know you know

team could do everything basically uh

jobs atme kevin.com and and we're still

investing right we're investing not just

in in these businesses but other

businesses and I think as long as

business owners keep investing we're

good we're we're avoiding a recession

downside is you get business owners like

this pizza owner yesterday we went to a

pizza shop beautiful location downtown

they opened up in 2019 right before the

pandemic crazy uh and uh I asked him hey

you know we were talking about their

tenant improvements and their deals with

their landlord and that and I asked him

hey how how have sales been and uh he's

like straight down and so very

pessimistic and and small businesses are

getting hit the worst by interest rates

right now and so we have to empathize

with small businesses who don't have

access to a lot of capital so they can

grow their businesses this is where

individuals themselves should be

investing in their education and and

building you know if you just shut down

and don't do anything right now you're

wasting time and you're wasting

opportunity not as great but in my

opinion you really want to do is is

build right now but there are a lot of

small businesses who are like that's

great Kevin but we can't you know we

can't take out more debt our sales are

down our revenues are down this sucks uh

and so at some point I think the Federal

Reserve wakes up and goes okay like if

inflation is indeed gone we can we can

lower the question is when and that's

the problem it just takes longer

Lauren's point of view on the pizza shop

was well they should bake better pizza

and I'm like

Savage uh anyway so Thursday I'll see

you at 8:30 in the morning let's go uh

take off and go to the mommy Moon see

you soon bye