my god, it’s worsening - why stocks are falling

hey the numbers that just came out are

even worse than they were just a few

days ago now in this video I want to

take the emotion out of this and just be

very matter OFA with what the data is I

I will give you my opinion towards the

end because I do think at least some of

you value my opinion uh that's said if

you don't that's okay you can cut out

after that part or after we go through

some of the data but let's start with

the data because uh this morning we got

S&P uh Global manufacturing numbers we

got ISM Manufacturing numbers prices

paid new orders employment numbers and

then as a result of that the GDP now

data updated so the GDP now data

actually you know a week ago it was at

positive uh 2.3% for GDP and uh this

Friday we did a video where it fell down

to one negative 1.5% right you saw that

right here negative 1.5% we went from

this sort of stable 2 and a half to 3%

range uh then we fell to 1 1.2% well

just updated again and now for today

we're sitting at a real GDP estimate of

Nega 2.8% now uh I'm going to give the

same disclaimer about this before I go

through some of the more granular data

that we have here it's really important

to remember that this Atlanta fed GDP

data set is very volatile because

they're just taking the most recent data

sets and they're going to weigh those

the highest so the most weight is on

your most recent data in fact in my last

recent in my last video I said hey you

know we we can get one good report and

it'll go from down to just straight up

again but because we got another

negative one it actually went deeper

down that's a Delta flight holy crap

it's

actually it's right side up all right

sorry bad jokes everybody's okay every's

okay I maybe too soon anyway sorry um uh

so it's very sensitive and the fact that

this next data set came out is uh and

it's as negative as it is is why now we

a 2.8 on the Atlanta fed real GDP now

forecast now remember it's taking that

latest data basically from February and

applying it to the entire quarter so

that's why you get these extreme moves

cuz GDP we know it doesn't move that

quickly uh quick note also you might be

wondering why I'm here I am am really

happy to share this but this is about to

be I'm about to take off in this except

I'm going to be flying it for the first

time ever I got this for Christmas two

years ago really cool uh still giddy

about it but I'm actually going to be at

the controls today which is kind of

crazy uh and so I'm pretty stoked about

that uh you know a lot of studying the

flight manuals and emergency procedures

and stuff but that means

today

uh I'll be sitting right here uh left

seat and I'll be flying my own

peeee it's kind of crazy yeah clean up

these touch screens what is this that's

the first thing I thought when I got in

here I go come on bro I know they're

touch screens but damn but anyway

honestly I can't wait to do this

oh that's kind of sick anyway uh okay I

guess I just did it no but I want to I

want to feel the horsepower uh at

takeoff so at elevation you're looking

at about probably about 2400 horsepower

uh each you know the engines combin uh

and at Cruise you're probably closer to

like 9,600 horsepower it's a little

different than cars and that these

turbine engines are calculated with

thrust and so velocity matters so you're

obviously slower when you're on the

ground than when you're up there anyway

let's get into the data so uh S&P Global

manufacturing this morning came in a

little bit better than expected at 52.7

this was one of the contributors to the

status set the survey was for 51.6 so

hot in Florida too dang on the west

coast of Florida it is beautiful out

here but I need to be wearing Beach

weather Beach attire out where are my

short shorts here uh anyway uh

bro try to make a movie over

here I don't know if you can hear that

but it's annoying to me so the

manufacturing PMI actually came in

better than I expected this morning

which you think okay well that should be

good right the problem was uh the S&P

manufacturing report this morning said

hey look you know manufacturing expanded

uh things accelerated this was great

however they basically asteris it they

said there's some evidence that sector

expansion was partly driven by Advanced

purchases ahead of likely price

increases and possible Supply

disruptions related to Future tariffs in

positions in the coming month uh new

work Rose to the greatest degree in a

year with firms pointing to a stronger

market for demand for their goods in

February but growth was primarily driven

by client restocking with customers

reportedly ke to get ahead of higher

prices and possible Supply challenges

International demand remained a

noticeable drag however on the overall

order books with new export sales

dropping in February for a 9th month in

month in a row and to the greatest

degree since last November now that's

really interesting because you've got to

kind of piece this together for a moment

the last GDP decline that we got was in

part because of a lack of exports to

other countries so that continues in

this S&P report so that continues to be

a drag that we're exporting less to

other countries that could be again that

punishment or that boycotting that we're

seeing Canada Mexico and otherwise right

but in addition to that the only good

news the reason we're beating is simply

because companies are trying to pull

forward or get in front of tariffs so

tariff uncertainty is creating some some

real oopsy doopsy now this wasn't really

the bad stuff the the next status set

was even worse but before we hit that

next status set I want you to see for a

moment this is the economist I'm going

to be clear here and remember we're

we're starting with just the the data

and the facts okay The Economist does

not like Donald Trump that doesn't make

them bad but they don't like Donald

Trump uh America is at risk of a

trumpian economic slowdown and as you

read it

beyond the noise a few themes stand out

this I I scrolled past most of this for

you I just want to give you the bottom

line stuff again beyond the noise a few

themes stood out a stand out and they

mostly hint at an intensification of

worries in the coming months even if

Trump again delays imposing tariffs on

Canada and Mexico which are due to take

effect tomorrow just like he

didc just like he did a month ago he

seems determined to raise tariffs on

friends and foes alike a more aggressive

Lurch towards protectionism than during

his first term as higher prices weigh on

consumption and Manufacturing his

tariffs could Lop off a percentage point

from America's growth rate according to

Analyst at Morgan Stanley measures of

uncertainty about trade policy have

spiked higher meaning businesses May

restrain from making Investments this is

what we talked about in the last video

that when people start pulling back on

wanting to make investments they stop

spending as much money on there you go

they stopped spending as much money on

uh on some of those durable goods new

cars new fridges kitchen remodels and

honestly this we're going to go back to

some data here because we got a lot of

data that came out this morning I'm just

trying to break it up and i' like to be

very clear when it's my opinion okay so

this next part here is my opinion and

then right back to the

data this morning course members asked

me oh Kevin you know should we get a

home equity line of credit should we

invest that into stocks or whatever I

said look I'm not anyone's personal

financial adviser my take is that at

this point in where we are in the

economy I I don't feel comfortable

saying anybody should have debt in the

stock market I'm not saying go run and

hide and sell everything just why would

you take on extra debt now if you wanted

to take on debt to have optionality when

the market crashes that if it does we

don't know that it will maybe that could

be cool you know I remember during Co

mind you like I want to be Mr by the dip

I feel like I was the definition of by

the dip I mean at the YouTube song Right

meet Kevin by the dip like I feel like I

was the definition of by the dip and

this is why people like oh Kevin's a

flip-flopper well no it's just because I

honestly have concerns right now and and

I I just feel wrong saying yeah yeah you

know take on debt and go buy the de dip

I've got a lot of people in retail right

now uh who hit me up oh reverse rusters

nice a lot of people in retail right now

they're like oh but you know Kevin I

want to get leaps I want to get Tesla

leaps you know 12 24 months out I want

to get you know Palante your leaps or

whatever and then I say okay you know

how how how's your valuation looking on

them and they're

like what do you mean it it you know it

was read for three days in a row I just

want to buy leaks and I'm like all

right that makes me nervous you know

when when everybody's still at the

mindset of like yeah man we got to get

some leaps I'm like oh no no

no so that's my opinion okay we're going

to go back to data in just a second but

my take is don't don't take on debt

right now avoid just don't go buy that

Sprinter van don't go do the kitchen

remodel okay uh like minimize your

expenses right now uh like you know I

just became a pilot I'm instrument rated

uh I'm multi-engine rated and I'm

getting type certified so I can fly

this I'm like I'm becoming aware of

things I just was never aware of before

as a pilot but I'm looking I'm like what

y'all charged me $700 to update the damn

databases you know how easy that

is I'll do it myself and it's not

because like oh I I'm desperate for the

$700 but it's because I'm like what am I

paying you to do you know to take out

Garmin pilot on the iPad and hit update

when when I can do that why am I paying

you $700 to do that uh that's insane you

know that's two times a month that's

$350 a time that's insane and my my

belief is that a lot of people

are going to start doing that a lot of

people are going to start you know

looking at their bank statements and

going the why you been paid for

this cancel that cut that cut that cut

that it's the economic cycle very rarely

goes from uh expansion to hyper

expansion to

slowdown to hyper expansion right you

you kind of have to continue the circle

you have to go through a downturn before

you can get back to expansion so I'm not

saying that's definitely going to happen

I'm just saying I'd rather be prepared

for any externality right with house

hack my real estate startup I would

rather be in a place where it's like hey

if if the market crashes and we can go

bottom feed fix uppers and help people

with affordable rentals we'll do

that if the economy keeps going cool we

got strategies for that too but we're

not going to go bankrupt you know uh so

anyway uh look at the data that came out

this morning uh so that was the 645 data

then at 7 we got uh construction

spending survey was Nega .1% we got Nega

.2% not a big deal ISM Manufacturing

same thing with the pull forward we got

50.3 it was actually a Miss versus the

50.7 here we go prices paid

62.4 versus the survey of 56 so

stagflationary right not good ISM new

orders okay so people are trying to get

all their existing orders in but then

what's happening with new orders which

is more forward looking

survey says 54.6 the last read 55.1 this

read

48.6 yeah that was a pooper and so when

you actually look at it here you go

February 2025 manufacturing what do we

have manufacturing activity okay the new

orders

index dropped back into contraction uh

after expanding for 3 months so in other

words it expanded you know after people

were getting excited about Donald Trump

right now it's back into contraction

just like crap that's not good uh I

don't I don't want to be in a

contractionary market right like I'm

telling you I want to be the bull uh but

anyway uh the February production index

is 1.8 percentage points lower than

January's figure uh the new orders index

was 6.5 percentage points lower uh than

what was recorded in January prices

index surged further into the expanding

territory of 7.5 percentage points from

where it was in January suppliers index

indicated further slowing of deliveries

however and indications that demand

weakened including included that new

orders drop back into contraction new

export orders uh expanded at a slower

rate so in other words there's that

export hit again the new orders are

slowing down backlog of new orders was

still in contraction uh so in other

words people are like all right give me

what I ordered and then I'm done and

then you get this talk here although

tariffs did not go into Force don't go

into Force until mid-march spot

commodity prices have already risen

about 20% okay now now we have some more

data so this explains why we're seeing

some of the poopy doopy now what do we

do with this information are we

definitely screwed no absolutely not

we're definitely not definitely

screwed we're may be screwed but we're

definitely not definitely screwed does

any of that makes sense I don't know

anyway so what does this actually mean

for us well what this actually means

means

is Wall Street is going to become hyper

Vigilant and responsive to data now and

I think basically when you get these

data sets if you're not paying attention

not to what the fed's saying but to

every single one of these data sets

you're going to get blindsided on your

trades because you're going to go oh man

the alos are are ruining my trades again

well no du because they're programmed to

this data so the second the data comes

out expect volatility and if you're not

expecting volatility after the data

comes out it's an oopsy doopsy now all

of this could turn

around like Donald Trump could by the

way you know why they put the stop sign

so low y'all know I'm really good with

stop signs so is that guy anyway you

know why the he was coming from the

other direction anyway you know why the

stop signs are so low so you can fly

over

them uh while you're taxi but

anyway what this means is we it's not

the FED talking that matters it's paying

attention to the continuity of this STA

and if Donald Trump flips and says you

know what forget it cancel all the

tariffs like he did the last time yes we

could go back into expansion but here's

what you really need to go back into

expansion look at this we got hay or

it's actually grass and a taxi light

what you really need to go back into

expansion is kill these damn tariffs

okay tariffs are a dead weight loss

they're a Bad Thing economically I don't

like it I don't like tariffs okay I get

it I get while they're doing it we had a

little bit of a debate in the comment

section the other day I understand okay

the whole idea of oh trade deficits are

bad is that it hurts American

manufacturers yes it does but it

actually benefits American consumers

because when we can order better stuff

cheaper from other countries that is

deflation for American consumers which

is what we want okay am I going to pay

three grand for a German MAA dishwasher

that's really hard to get service for or

am I going to get uh 4 $99 dishwasher

made by GE comes with a warranty and

it's made in Mexico it does the same

damn thing it makes your dishes clean

okay that's a form of deflation now of

course Donald Trump's going to say but

that's bad for American

manufacturers okay then go figure out

how to get the unions to pay wages that

are even competitive to what you could

pay for in Mexico Oh wa you can't

because people in Mexico are earning

$3.50 an hour at these manufacturing

facilities and union workers in America

are making $35 an hour so it's a $10

it's a 10x difference so it's like oh

well you know Americans should support

American that's fine then pay higher

prices you could also pay German if you

wanted to and pay ripoff prices like

that that's the the free

market will send manufacturing where it

is cheapest to do so it's it's it's a

very simple easy game so this idea that

you know a trade deficit is bad is is

yes it's bad bad for union workers and

manufacturers but it's great for people

who are

consuming uh maybe I'm just bitter

because these turbines right here I'm

not really bitter about this I just

think it's funny uh it's a reference see

these turbines right here you know where

those suckers are

from Canada I don't want tariffs on this

you know how much the tariffs are going

to cost me on

that whatever it I always say listen

tell me what the rules are and I'll

follow the rules but

I would make the

argument that just blatantly if we

really want to go back to growth stop

the

tariffs stop the count I mean the

tariffs after you stop the tariffs then

you need something that actually

supports the economy you need some

throttle right even the economists said

it here because the first thing that you

had was uh for tariffs hurt right but

the thing that was supporting the

economy after Donald Trump won was hope

but right now I made this analogy my

remember live stream this morning I made

this argument that we're it's sort of

like we're on a plank okay so imagine

I'm on a boat and and there's like a a

plank coming out of this but it's like a

rickety Dicky Plank and you're standing

on it and it's like wobbly and

underneath you are a bunch of stag bites

or sharks I don't know whatever floats

your boat I guess uh like we're on a

shaky platform and tariffs hurt it's

like somebody threw a bag of like coal

at you and you're holding it and now

you're on the plank with all this extra

weight like come on man I still have

faith in you bro but it's getting a

little hard to stay up over here really

what you need is Trump to go let's take

the coal off okay and then let's walk

you back to like good land and let's

give you some tax breaks okay that's now

all of a sudden you could get back to

growth because that's what people have

been anticipating but if you're out

there holding coal he's like nah man

we're going all in with the Terrace

things are going to get worse before

they get better sorry bro you're like I

don't know how much longer I can keep

this what about the tax breaks next year

bro dude I can't I can't handle this for

a year you fall into recession okay so

what the underlying economy has already

not been that good you know I was just

reading I think it was was it it wasn't

credit agrial it was somebody this

morning finally cuz the institutions

they've been so everything's fine and

I'm like man y'all just are you not

looking at the underlying data and then

I finally saw a piece oh it was Academy

security

uh this

morning they wrote uh the economy is not

as good as current data suggests and

they talk again about uh the Bureau of

Labor Statistics and how you know broken

some of their measures are uh we're

waiting for headlines from the zalinski

War uh you know the Russia zalinsky

issue uh we're waiting for tariffs we

don't know what to make of this art of

the deal thing we don't know what to

make of jobs data that's coming out this

Friday the jobs data this Friday is

supposed to be good like 100 60,000 jobs

or whatever but what if we get a bad

report you know these are just things

that that people are going to be nervous

about so where is the economy headed

Nobody Knows the economy will be more

difficult with uh what is this let's see

finally what we've seen on Equity away

from the Russell 2000 so away from small

caps no dub has been more

about oh okay all right yeah yeah yeah

no problem okay sorry uh stupid thing

just died but I read it all earlier they

basically like more away uh people are

moving in stocks away from some of the

risk right the smaller caps deem to be a

little bit more risk going a little bit

more into credit quality personally and

this is my personal not I'm still a TLT

bull I know that i' I've been bullish on

TLT since July I know it it it had done

very poorly because of uh Donald Trump's

uh Victory and then the FED cutting

rates uh 100 basis points leading TLT to

go up or I'm sorry bond yals to go up a

th 100 basis points because that makes a

lot of sense but anyway um you

know I think it we're getting closer to

where it makes sense where it's like

yeah if we get any kind of shock TLT

could be going straight to the moon so

those those TLT January 2026 and January

2027 options are still looking pretty

Juiced in my opinion uh but you know

that's my opinion so I want to be clear

data versus opinion here so what's the

bottom line of all this

the bottom line out of all of this

frankly is we don't know but times are

uncertain that's obvious uh and I think

it calls for being cautious now I

understand some people are going to look

at me and go oh but Kevin you know if

everybody who listens to you Cuts then

we're going to self- fulfill a recession

I mean I don't think everybody's going

to listen to me uh and that's fine but I

told my course members this morning I

want to be in a place where everybody

you know who who watched my content and

said you know what I'm going to make the

right decision get get out of Deb or

minimize my debt minimize my downside

exposure this is hard to do with one

hand um they they survived the recession

or or even just

tumult it's hard to do with one H

whatever it is they survived that's

that's what I want because I don't I

don't want to see people get uh I

understand there are hopes for like oh

but if we YOLO in now you know we could

make big dollar hollas or

whatever okay but you know look at

Warren Buffett I know it's it's hard to

when things are booming but the thing

about Warren Buffett is he protected

that

downside and I think we'd all be wise to

actually look at some of this data and

say look can it all rock it back up yeah

and remember the conditions for

it reducing this trade War minimizing

some of the G political tension though

that's not as big of a deal minimizing

the trade War would help and then

actually getting some of these tax cuts

going so far even as The Economist said

things are a little chaotic we don't oh

that's a serious taking off we don't

know where we are with Great Planes by

the way people call them the Rolls-Royce

of uh single prop planes or just prop or

you know smaller planes in general but

anyway we don't know where we're going

with terrorists we don't know where

we're going with geopolitics again

Terrace is much more of an issue because

of that pull forward of demand you're

getting that up in demand uh now you're

getting this sort of realization of down

people are taking their orders and

they're done people are complaining

about who's going to pay for the tarff

blah blah blah blah uh and then where do

we go from there well then it turns into

okay are people ready to spend like

they're super optimistic now it's time

for people to put their money where

their mouth is and so far we just

haven't been in a place where people are

willing to put their money where their

mouth is because everybody's waiting uh

anyway so I hope that helps you we'll

see you on the next one goodbye good

luck everyone uh really appreciate you

all supporting the channel consider

subscribing see you soon bye