The Stock Market is About to Collapse.

okay look we're wearing the don't suei

bro vest right now because a lot of

people are wondering why the heck is

Kevin flip floing again and turning into

flipflop hoppy hop Mr bear and when is

it going to end and what new data did

Kevin find out

today that might change everything well

in this video I'm going to share exactly

that catalysts fed talk and much more so

buckle up and get ready to take some

notes and the first thing we're going to

take notes on is the following see that

right there that's the NASDAQ 100 it

bottomed this morning at exactly

1014 it was within the 10:14 Candlestick

right there is where we had our bottom

and we Revisited after recovering after

the NASDAQ ran up to a positive 80 plus

basis points we gave it all back into

the close which is very important it

indicates fund selling funds A lot of

them issue what are called Market on

close orders uh where within the last 10

minutes you're getting a lot of this

reshuffling and rebalancing and boy look

at the inbalance we had there at the

close plus the surge in volume that we

had there wasn't a single green

Candlestick right there uh we still

didn't end up lower than where we were

at that moment over here uh but the

reason I specifically bring up that 105

moment the very minute after that bottom

uh is specifically because I had three

different short options that I closed at

10:15 here it is on screen I had a Tesla

put closed profitably SLE Q's put Clos

profitably 1015 and another one 1015 on

socks so thanks for the 65k on the day

if you want alerts like that the second

I see Trend change like that should be

part of the stocks and psychology of

money group remember you pay once

there's no monthly fee you get lifetime

access all the course member live

streams my ideas trade alerts you name

it can't guarantee we'll make money but

we're going to do our best now let's get

into the topic okay first of

all a lot of people think that the

Federal Reserve is going to announce a

rate cut on July 31st not for July 31st

but that they are going to lay the hints

for the rate cut on July

31st I cover the FED a lot I don't think

the FED is going to do that and I'm

going to be clear with why it would make

sense that if the FED is going to cut in

the third week of September which is

what's priced into markets right now

that the Federal Reserve would give us

hints at the very meeting before

that but that would be wrong because

what happens in August that you probably

don't have on your

calendar third week of August Jackson

Hole the Jackson Hall economic Symposium

which means we could have a July 31st

with no cut from the fed and no hint

that they are prepared to cut instead

they could wait for the Catalyst of the

jobs report coming out the first Friday

of August which is next Friday 2 days

after the FED meeting and also two days

after the experation of that coupon code

me kevin.com uh and they could get CPI

data which comes out I believe it's

August 14th which is about 8 days before

the Jackson hle Symposium so in other

words they could collect all of this

data CPI PPI jobs data and then they

could lay their groundwork for hints for

the September meeting about a month

prior in the third week of August so

unfortunately I'm throwing cold water on

the belief that the FED is going to

somehow

roll over next Wednesday could be wrong

but that's my take another thing that

seems to be wrong in markets and this is

a really big deal something else that's

wrong in markets is people have this

impression that there's so much cash on

the sidelines waiting to get invested

into the stock

market well according to BCA research

via zeroedge this is wrong most of that

money is probably my guess at Mega caps

in Money Market funds or at financial

institutions that are parking cash in

money markets because they have

to but some of that money it could be

even the reverse repo facility which

could invest into the overnight uh uh

you know funding Market but anyway

what's Wild is I want you to see this

particular chart you ready for this it's

a little mind-blowing here it is on

screen right now cash on the sidelines

for us retail invest vors and investment

firms households this chart by the way

goes way back to like 1980 households

are lower than at any period we have

ever seen in terms of aggregate quote

investable funds as a percentage of

equity market cap okay now In fairness

that percentage does go down as the

market goes up so the Richer the market

gets the investable capital looks

smaller but let's just compare to

previous periods where those numbers

have been really high the time to buy oh

look at that the 2008 financial crisis

investable assets are at record highs oh

look during covid record highs oh look

during the dotc bubble during the

crashes during the crash periods record

highs we're actually at the pre uh uh

Doom bubble record lows we're below that

now so investable cash by retail is like

gone it's not going to take a lot of

selling off for people to start going F

this I'm out and that's the problem you

know people have been fat and happy

through this Nike Swoosh that we've been

calling since November of uh 2022 which

is when I launched my fund this is not

an advertisement for my fund I want to

be clear don't sue me bro but let's be

clear I launched my fund at that timing

because I'm like I think we're at the

bottom of the market I'm going to go

heavy chips and and and you know Tesla

or whatever and uh uh and and it was

great so is the perfect time to launch a

fund now investment

organizations also sit at the low we

hadn't seen since right before the

pandemic and right before the dotcom

bubble that's not great it's not great

at all so that makes me a little bit

nervous because it doesn't take a lot of

a spike in the vix to trigger volatility

based selling there are a lot of instit

tions ctas or or well groups of

investors groups of investors would be

ctas but there are also a lot of

Institutions who assess their

allocations to the stock

market based on what volatility is so

when volatility is low they just keep

buying stocks when volatility spikes

like it did yesterday and the vix one

over 18 what all of a sudden happens is

you get forced selling because companies

ctas Pension funds you name it have

rules they go as soon as we get the vix

over a certain threshold dump and it's

basically just a way for them to avoid a

a you know massive massive blowoff in

the vix but then that's when you really

start everybody selling and usually you

know retail is always like buy the dip

buy the dip buy the dip and then all of

a sudden like they're the last out and

they're the ones holding the bag and

then they sell at the

bottom so I I think I'm still or

actually quite early on this I think

we're very very early on this I really

started getting nervous and you could

have seen this in you could still go

back there it's still there course

member live stream on July 11th and July

12th we're like uhoh this could be the

start of something and we really started

getting laser focused on what is going

on listen to this the S&P

500 went

356 days without a single negative 2%

day that means you basically had a year

without the S&P 500 selling off more

than 2% that folks ended yesterday guess

when the last time was that that

occurred at that sort of magnitude or a

magnitude greater than this oh

2007

okay well but Kevin GDP is

good folks this is a ridiculous argument

first of all who cares about Q2 GDP it's

backward-looking data and additionally

try to align the GDP bottoming out with

the bottom of the

market bottom of the market in 2009 you

still had a GDP decline to go bottom of

the market was 3.2% right but look how

quickly you got there q1 2009 you had

1.3 3 2.3% GDP Q3

2007 and so when you look at markets

let's go back let's go to

Q3 2007 and I'll give you a little

thesis over here as well so the third

quarter of 2007 would be

July so take a look at this this and

let's zoom in a little bit since

obviously today's numbers are pretty

wildly different so J Q3 2007 was right

here it was roughly the top uh Q4 would

be October November December so

September August July this was Q3 right

here this is when GDP was basically in

2007 where it is today so sure you had

another from the peak over here you had

another maybe 10% upside on the qes but

the downside you then had from that Q3

period of time uh was about a half the

market

haved so like my view is that you have

as uh roaring Kitty would put it an

asymmetric bet here maybe there's a

little bit of upside left but the

downside pretty fat right now I mean

just think about some of the generics

right uh you've got an election selloff

which is typical you've got typical

selling in uh uh in Q3 this is like

seasonally one of the worst times you've

heard it before selling may go away so

election selloff is typical especially a

presidential election massive

uncertainty going in through September

and October seasonally Q3 sucks no cut

in July is coming they're not going to

hint of a cut uh on July 31st for

September in my opinion valuations are

like high and sentiment is starting to

roll over you know people start looking

at their portfolios and go oh my God I'm

I'm down a lot of

money oh no and and and then they and

then they're like no no no I'll just buy

the dip a little more and then it just

keeps going and it's it's usually when

retail capitulates that you know that's

that's when you know the bottom is keep

in

mind right now when I post a bearish

comment on on uh Twitter at real me

Kevin or Instagram or wherever uh people

are still yelling at me people are like

you're crazy you know whatever they're

freaking out they're like this isn't the

bottom you know I'm making jokes about

Tom Lee uh and and basically I'll talk

about small caps in a moment but the

point is I'm getting a lot of people are

like what are you talking about

everything's going to keep going to the

moon

man now I know we're not close uh

speaking of uh oh yeah I want to cover

that in a moment but speaking of

Instagram quickly want to mention if you

want to see uh the little videos that I

post uh of these uh of these little coot

babies uh make sure you're uh following

me on

Instagram that's uh that's our little

Ella you can follow me at real meet

Kevin you also get to see summer she was

taking a bath and then we've got IID

over here as well uh so oh yeah thumbs

up well look at that AI getting to work

oh

yeah uh oh that's making my my stuff lag

a little bit what we got going on over

here this is craziness it's too it's too

much cuteness is what it is cuteness

overload is causing some lag all right

anyway so uh what else well there are

actually a few additional things that

we've really got to pay attention to

here actually quite man I was okay we're

we're not even close to ready yet you

ready for this CTA selling okay first of

all when you hear CTA usually people are

like oh that's just Commodities right no

CTA stands for Commodities trading

advisor and they own a percentage of

their allocation uh in stocks us

equities there's actually a chart of

that uh in fact I'll just go ahead and

throw that up on screen right now ctas

are close to a Tipping Point where

further downside moves will mean

outflows this green level is basically

where we sit now and you're kind of

peaked out the upside is maybe there's

another like what is that 5% room in

there to go up otherwise we're either

going down a chunk or we're going down a

lot with CTA allocation in fact I think

zeroedge put it well they said CTA

selling could soar unless an aggressive

dip buyer

emerges this in my opinion suggests that

the upside is limited the downside is

massive

especially since this sort of suggests

we're at essentially a near Peak which

is not great either now then you have

folks saying hey but you know what about

inflation inflation is going down this

is true Chipotle for example says people

are stepping back on restaurants uh

spending in general we've seen a step

down in the industry yesterday they blew

out earn great earnings excellent

earnings they were up 133% in the post

Market they gave it all away and ended

up negative

today they said they see a step back in

spending vers as menu prices uh have

have gone up not because of inflation

but because they had to keep up with

like a 1 to 2% increase because of the

impact of like California wages and that

and they basically say they gave all of

that to the vendors in other words if

they raise prices a dollar they had to

give the whole dollar they took a dollar

from here gave the whole dollar away so

like they're not benefiting at all from

price increases right now and they think

it's going to get worse they think

margins going to be margins are going to

be under even more pressure going

forward

look at American Airlines I mean

American Airlines is the definition of

quite frankly little PP yeah it like

there's no pricing power in an airline

this completely ridiculous Ryan ER

thinks fairs are going to drop 5% in the

third quarter which is like 20%

annualized Which is a huge freaking

number uh inflation or disinflation is

quite frankly just going to destroy the

airline business I think you'll have

bankruptcies at the airlines it's crazy

Southwest just rolled on their frenzy of

seed assignment you know system and now

they're going to start doing assigned

seats that was by the way the most

moronic thing ever I flew one time with

Lauren we got like the B section or

whatever the second one is I don't know

I I don't fly Southwest uh and uh got

like the B section we go in there we're

like oh oh hey you want do you want to

sit here some guy shoves a briefcase

between us to snag the window seat and

shove his way through us and we're and

then we ended up being separated the

whole flight and so after that Lauren

and are like never again are we going on

Southwest and we never did and then we

bought a plane instead see it's right

here see people like Kevin did you sell

your jet no it's right

here no I didn't sell my plane I didn't

sell my plane my plane makes a money all

right so at the same time as companies

are screaming we're losing our pricing

power the Federal Reserve is looking at

lagging data which is completely

worthless you have Jim bolard who

doesn't work at the FED any anymore but

he's like it doesn't seem like a

recession is any more likely now they

are so behind they're so behind it's

it's very

scary uh okay uh beyond that it is worth

noting that we haven't seen the panic

yet like I I do want to say I think this

is very early my my warnings here going

into the election they could be very

earning early I don't actually think

we're going to see like a drop off the

cliff this isn't like covid where

everything dumped in a matter of two

weeks and the market was straight down

for two weeks I personally think you're

probably looking at something that could

be more like a three-month process just

it just everything's topped out and then

just slowly keeps leing down a little

bit of up leing down leing down leing

down reason for that is you know the

election

uncertainty that's a huge one you're

going to like you have to ask yourself

who is going to buy energy stocks in

September and October before the

election if they don't know who the

president's going to be who's going to

buy uh a Tesla who's going to buy

certain stocks that either benefit or

get hurt from uh you know whomever the

president is per the perception right

it's not necessarily always true uh

until they have that certainty I mean I

will I'm going to go shopping at the end

of October I'm like please sell off baby

I'm going go short and keep buying but

I'm not going short so fast I mean

yesterday when I was talking about the

market selling off uh likely I I had

zero options positions uh I had zero

shorts outside of um a 23 and me short

but I had no shorts outside of that

sorry it's a 23 me call so I guess that

means uh I had no shorts so I had no

shorts I thought it was a put for a

second it's a call um no shorts I was

wearing shorts but I was not short

yesterday when I made that video now

this morning when the market opened I

shorted it right away I sent an alert

and then as soon as the market bottomed

uh and I'm like that's a good enough

profit I took my

tendies and now we move

on uh I did uh open another short

position for today though uh roughly I

mean the NASDAQ at some point was green

and uh I opened a

short it's a small position it is

positive I think it's actually up like

11% right now I'll I'll look at it

really quickly it is um it's it's the

qes I'm just I'm shorting The Q's

uh it's it's a $40,000 short on the cu's

uh and it's up

11.4% I mean we had a nice sell off into

the

close uh and that wasn't a day trade

that was a swing trade I'm holding that

I don't have any other trades really

going right now just the short on the

cues and then 23 and me but uh I want to

build that short Q's position I'm a

little nervous that you could have like

one stock really rally in the

semiconductor short ETF and that just

sort of screws up that bet but I think

the whole qes will move down now another

thing we got to talk about is so it'll

take time and there's time to DCA

there's still time to take cash off the

table not personalized advice blah blah

blah you know all the drill but what

about small caps okay so this is a

really interesting one because a lot of

people are like oh we're going to get

into small caps so don't take it for me

but I think getting into small caps

right now is like mentally deranged I'm

bleeding getting into small caps right

now is like look if we don't go into a

recession fine great

but if you go into a

recession small caps are like the worst

thing to be holding on to it's literally

a stick of dynamite that you're holding

on to it's stupid now I know that people

are like oh but but Kevin you know rates

are going down bro I mean you're going

to see that in just a moment how and I

want you to think about this what

percentage of small cap debt do you

think is variable in other words what

percent of small cap debt do you think

small caps are going to see a benefit

from when rates come down 25 bips every

so

often a lot like most people are like I

mean may may maybe maybe a lot of it or

or they'll be able to refinance right

yeah good luck refinancing when when

Banks start tightening their credit

standards so you know you would think

okay if small caps are really going to

benefit from lower interest rates then a

lot of their debts probably variable

like variable credit lines or whatever

right well let's look at the facts

according to Wisdom Tree small caps have

about 30% of their debt that's variable

large caps sit at about 8% which means

this whole idea that oh they're going to

benefit so much off of uh uh you know um

lower rates you know that's that's a

good thing you know they're they're

going to be great and uh therefore

they're going to go to the Moon well

consider this the Russell 2000 today

trades at 15.5 times earnings what's the

long time average long-term average

15.2 which means you're You're basically

trading at the long-term average

valuation for the Russell 2000 now you

are selling for a 25% discount to large

caps or a 17% discount if you exclude

the mag 7 so you do have a discount

compared to the overvalued NASDAQ this

is why I wouldn't go short Russell I'd

go short NASDAQ but I'm not going to go

long Russell assuming that we're going

to have enough Euphoria in the Russell

while the qes are selling off to push

the Russell to new highs now In fairness

if I go to like an

iwm you know my crystal ball for the iwm

does suggest there is some more

potential upside uh just based on this

retrace I think you could probably knock

on the door of

236 236 is what I would argue and that

would be justified from a technical

point of view for that Breakout uh I

don't know if we'll actually get it you

can see we're starting to get a little

bit of No Man's Land resistance over

here this is basically a consolidation

that you've had and so the question now

is do you go back to the line or are you

going to try to go for 236 if we got to

236 that might be a time to take profits

or just now anyway not personalized

advice okay I'm just a dude on YouTube

but anyway going back over here look at

this the

11.5% jump in the index the first five

sessions after the CPI release was only

exceeded by spikes witnessed amid the

crisis of 1998 which was a certain hedge

fund collapse the do bubble the global

financial crisis and the 2011 US debt

downgrade and the

pandemic are you freaking kidding me the

only times ever the Russell 2000 has

mooned 11.5% in a 5-day period was

during periods of

substantial uh or or leading into

periods of substantial distress and and

so now that makes me wonder like some

people might look at that and go okay so

but was that by the dip time well it

depends on exactly where it was within

that they didn't specifically tell us

that I guess we could go looking for it

uh I mean hey you know what let's go do

it let's go to Global financial crisis

iwm

go right here let's go to the week chart

and we would be looking for a big stick

up Global financial

crisis I think I see it you see it on

the week chart right there look at that

on the week chart that that's probably

it right there uh that would be

September 19th 2018 it was it ran up to

$71 intraday crashed to

$28 oh my God within 6 months I don't

know if that was the point but if we go

down to the day chart it's going to take

a minute get down to the day chart we'll

be able to see it so that would have

been

2008 right there in about September

let's get all the way down to 70 what

we're looking for is 5 days in a row

basically I'm on the day chart this was

just a crazy intraday move on the iwm so

it doesn't look like it was this period

here it could have been a low over here

from 53 to 59 that would be about 10% it

could have been this move from 39 to 45

but it could have also been this bottom

move they're referring to the problem is

this bottom move right here in March of

2009 was when the Federal Reserve came

out and basically bailed out the markets

we know that's not happening right now

so it's unlikely this Spike right here

where the FED unlimited bailed out the

markets look it up it was March uh March

or February of 2009 actually I think it

was February of 2009 which was uh looks

like maybe there was another week of

pain after that but anyway right around

this area within a six- week period of

this happening the Federal Reserve in

2009 went all into bailout markets and

we know that's not happening right now I

mean unless they do it on July 31st but

certainly not coming after that because

it already happened and the reason for

this is probably because the iwm index

usually moves slower that's why those

sort of moves are not that sustainable

now it's also you know a lot of folks

are wondering okay is it just like so

it's it's not valuation because value

ation is historically average is it

short selling yes possibly it could have

been that there was a lot of short

covering that was a factor uh other

people are wondering well maybe earnings

are going up for small caps it's not

that either consensus S&P 600 small caps

2024 EPS estimates are down 1% month to

date via Bank of

America so it ain't

that so now you're in this place where

cash positioning is terrible the small

cap trade I think is a ticking time

bombb it's going to implode I think

Tesla's best quarter is now behind it us

they literally gave us the kitchen sink

of good news and the stock fell 12% yes

we co recovered you know 2% or whatever

today pck deal but we fell

12% after the best news imagine what

happens when we get reality in Q3

Q4 trimming down

Tesla uh the other thing is Google

actually had a pretty good quarter yet

Google's down

8% ouch uh over like the last 5day

period you had a little bit of selling

uh going into earnings so today it looks

like uh let's see where we sit right now

Google's at 168 today you were down 3%

today that was today's move yeah you're

down about 8% over the last week it

started trending down it got rejected

off the 193 line alltime High uh and

it's been straight down since then you

could see that a little bit more clearly

right here earnings just gave you two

more red candles basically that's on the

average so Chipotle gave up all of its

after hours so basically you had good

news for like for Chipotle to go

positive 13 and the negative that's a

14% swing it's kind of like the NASDAQ

which almost had a 2% swing in day today

which is crazy with that selling into

the close you're starting to see signs

that people are drisking they're getting

nervous and they're moving away from

stocks it makes sense it just makes

logical sense because listen if you take

money off the table and the market goes

up the only thing that

happens is you have a little fomo a

little fear missing

out now if the mark Market dumps 30% and

you lose you know 30% or more

potentially of your nest egg you're like

now I want to die that's really bad you

know I'll have to pitch you life

insurance at metkevin.com

lifee okay sorry that's insensitive um

we do have life insurance through them

that is a paid promotion I haven't

really pitched them much consider

pitching them more okay what else

inverted yield curves about 19 basis

points uh my my thesis could be wrong I

do want to be clear about that I'm at

about a 4 and a half on the bear scale

right now so I'm a bear think I'm going

to be a bear for about the next 100

days uh it could fail what would make my

B my thesis fail if Drome Powell starts

hinting at cuts on July 31st I I don't

think he will I think he'll wait for

jhole but he could uh and then of course

maybe next week earnings just kill it so

I don't want to go ridiculously heavy

into those earnings with shorts I'll

have some and then my plan is to sort of

DCA into them uh unless there's some

reason something from one of these

company suggests we're going to have a

moon Microsoft AMD Amazon meta arm

Qualcomm Intel Apple all next week huge

set of earnings next week

so what more can I say check out the

programs on building your wealth be part

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Adia Martin Tony P Harry Dave Todd y'all

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thank you so much really appreciate yall

joining

uh and uh and then you get those trade

alerts and the stocks and site group a

lot of people are bundling that up by

the way with the gold course or zero to

millionaire real estate course I do

think in certain markets it's buy time

right now and so we're buying for house

hack we've got hopefully soon some

really big announcements coming for

house a so really really excited so stay

tuned and um we'll talk more thank you

have a good one everyone goodbye and

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congratulations man you have done so

much people love you people look up to

you Kevin P there financial analyst and

YouTuber meet Kevin always great to get

your

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