Supreme Court to FLIP the Economy | ENDING TARIFFS

not great for the president. Uh there

was at least the suggestion that the

court was prepared to strike down both

Donald Trump's uh reciprocal tariffs,

the ones that are dealing with the the

trade deficit and some more targeted

ones that are designed to counter

fentanyl trafficking out of out of a few

fentanyl trafficking out of a few

countries including China. Um it's it's

possible we would see a split decision

and some tariffs will be upheld, others

struck down, but the overall tone of the

argument suggested that Trump was going

to lose on at least some things.

>> The US Supreme Court is about to rule on

Donald Trump's tariffs, and they come at

a critical time for the US economy. This

could be the difference between a

recession or a soft and smooth landing

and a recovery from where we are right

now because we are at a critical

junction point with the labor market and

the Supreme Court's ruling on tariffs

could change absolutely everything.

Obviously, what's at stake here and what

we're going to talk about are very

clearly the AIPA tariffs. Those are the

Emergency

Economic Powers Act tariffs. These allow

Donald Trump to issue reciprocal

tariffs. Now, of course, we know there

are other opportunities to issue tariffs

such as section 232 tariffs or section

301 or even 338 tariffs. However, 338

tariffs haven't been used in almost 100

years. 301 and 232 tariffs can be used,

but they're harder to apply broadly.

See, with AIPA tariffs, Donald Trump can

issue an executive order and go, "We're

doing tariffs." Yo. But lawsuits,

specifically the two main lawsuits,

along with now as many as a thousand

more lawsuits against the United States,

the two main lawsuits being Learning

Resources versus Trump, not to be

confused with Learing, uh, and of

course, VOS Selections v. Trump. Both of

those cases are in front of the Supreme

Court. And we've got to talk about the

impact that those cases could have. And

then of course, why are there upwards of

a thousand other cases going on against

Donald Trump's now regarding these

tariff lawsuits? Spoiler alert,

everybody's kind of expecting Donald

Trump's tariffs to uh get kicked out.

And uh after they get kicked out, they

want to stand to collect money or

refunds. Hence why Bloomberg says more

than a thousand companies are suing

Trump over his tariffs. But first,

before we go through what's likely to

happen with the Supreme Court and the

Supreme Court calendar and how the

Supreme Court is likely to rule and why,

I personally think it's really important

to analyze where we stand with the

economy today based on data that we've

gotten within the last 3 days. And there

is a lot of it. Look, here's the bottom

line. When we look at our Jolts report,

it tells us that while the labor market

is weak and job openings came in lower

than expected, we're still not seeing

big layoffs or big discharges, at least

not yet through November. Now, yes,

companies are laying off. But when we

look at the challenger jobs reports, we

can actually see that we're at the

lowest level of job cuts since July of

2024. and companies actually have the

best hiring intentions since 2022.

Now, this is a really great report and

combined with Jolts, it's actually not

that bad. Yes, some people are losing

jobs to automation. This is why Symbotic

stock has been a killer. We've been

promoting and pitching that stock for

quite a while. Not talking my own book

here, just saying it's been one that

we've been analyzing since like $18 in

the course member livereams, which you

can be a member of all the time over at

mekevin.com. But job cuts falling to the

lowest level in 17 months. This is good.

We're seeing fewer job cuts and this is

overall bullish with closing out the

year at the lowest level of announced

layoff plans. Now, that doesn't mean

everything is great. We have an average

employment level sitting around 20,000

jobs per month right now on the ADP

report level and about 30 to 40,000 on

the BLS jobs report level. Jerome Powell

of the Federal Reserve says we should

minus about 60,000 from those numbers.

And that's why we should be cutting.

Myin over the Federal Reserve suggests

we should be cutting as much as 150

basis points this year. That would be

essentially well if I take 150 divided

by 25 that would be six rate cuts.

Markets are really only pricing in about

two rate cuts. Waller who's applying for

the Fed chair job as well is now saying

he's open to as many as four rate cuts.

But still the rate cut for January 28th

with these CBO numbers on GDP at 2.2% 2%

for 2026 and these recent numbers on

jobs not good enough to justify rate

cuts. So the odds of getting a rate cut

on my birthday, January 28th, are only

about 15%. Now, a lot has to do with the

jobs report that's still coming out

tomorrow, but that's still going to be

looking into the past a little bit.

Tomorrow's jobs report, which comes out

at 5:30 a.m. on January 9th at 5:30 a.m.

I'll be covering it. That's California

time. We expect 70,000 jobs. Now, 70,000

jobs is decent, but if you minus out 60,

you're still below break even, which is

probably somewhere around 20, where the

unemployment rate doesn't rise or fall.

And we're going to have to pay attention

to that unemployment or rather I should

say the labor force participation rate

because the participation rate can

actually say that oh look we created

70,000 jobs but if the participation

rate goes up the unemployment rate could

skyrocket and that leads algorithms in

the stock market to get a little bit

nervous which is I think why we're

seeing some nervousness before this jobs

report when we look at broader indices

like the Q's. The Q's have really been

on this downward wedge pattern. Now this

is the NASDAQ 100. if you're not

familiar with it. And I personally don't

encourage people to invest in QQQ

directly. If you're going to do that,

get QQQM. It'll save you some money. But

we can see this consolidating wedge

here. And honestly, this wedge is

suggesting that people are relatively

fully allocated. And on a technical

basis, things don't look good on a

technicals basis right now. In fact,

this technical wedge suggests that we

could get choked all the way back down

to 577 in a little bit of a correction.

the jobs report tomorrow and the ruling

by the Supreme Court should help us

determine is it a buy the dip

opportunity should we get that dip now

I'm buying dips and actually some stocks

are just like surging in this my top 10

stocks to buy list which is crazy one of

the stocks that we've been we talked

more about this morning in the course

member live stream is up like 28% in the

last week and I'm like bro I want to buy

more but it keeps going up too fast but

anyway really enthused by this one but

anyway what's important here is

understanding the economy is at a

precipice. We have some data that says

things are good. We have Jerome Powell

downplaying that data and then we have

survey data that isn't that great on a

leading basis. Take a look at the survey

data. If you look at the SNP survey

data, we actually say that resilience of

the US economy showing signs of

cracking. New business placed at service

providers showed the smallest rise in 20

months. and that surveys are signaling

the weakest economic expansion since

April. And at least based on this

survey, which is a little bit more of a

leading tell into the beginning of

January, the number of companies cutting

headcounts has now started to exceed

those reporting higher employment. So

Jolts, Challenger, and BLS jobs data,

they're either all looking backwards or

they're rigged where the survey data is

a little bit more cautious. They're

like, "Hey, on services, [snorts] you

know, we've we actually have some

serious problems that may not be so

great." But it's not just services. If

you go over to manufacturing, you could

see some issues in manufacturing as

well. When we look at the SNP and the

ISM reads for manufacturing, we see that

both of them tell us a very similar

story. Both of them are telling us we

are seeing cracks in the market because

new orders are falling. In fact, if you

look closely at the ISM manufacturing

data, they go as far as saying the

recent activity that we've seen in the

economy is actually just a short-term

bubble of improvement. That in December,

US manufacturing activity contracted at

a faster rate with pullbacks in

production and inventories leading the

index down. It's not just ISM though. It

was also S&P suggesting the same exact

thing. When we look at the S&P

manufacturing data, you can see it right

here. You see that we're bullish jobs,

but we actually might be in a wy coyote

scenario where we think everything is

good and we are a cartoon character

continuing to run despite the fact that

we've now chased the Roadrunner off a

cliff. That factories are producing

goods with the jobs that they've

created. But we're now seeing a drop in

orders, the widest drop since the height

of 2008 and 2009.

And as time goes on, payroll numbers

will be adversely impacted unless we can

recover from this manufacturing dump

that we're in right now. Remember, it

wasn't just manufacturing, it was also

services. So obviously the stakes at the

of the economy are very high. We're at a

turning point. Take a look at this. the

probability of finding a job in the next

three months according to the New York

Fed. The lowest odds that people are

giving in Fed surveys since well

basically ever on this chart because I

drew this little red line across. We've

never been this low in terms of people's

optimism for their ability to find a job

and instead people are pessimistic about

their debts, debt delinquency

expectations, the probability of not

being able to make your minimum payment

over the next 3 months. highest levels

that we've seen since 2020 and 2013. We

know that the economy is at a turning

point in my opinion. This is my personal

opinion, then we'll hit the facts again.

eliminating the AIPA tariffs and

destroying the president's ability to

unilaterally impose inflationary tariffs

on American consumers and American

companies obviously in addition to

foreign countries will not only lower

inflation but increase growth, increase

hiring and lower long-term rates. That's

my opinion. That's why I think these are

critical to solve the hiring or lack of

hiring and lack of new orders that we're

seeing in the economy now. Now, you

might not agree with my opinion, so

let's go into the facts on the court.

Here's the scoop. Right now, the Supreme

Court is reviewing the AIPA tariffs.

These are the International Emergency

Economic Powers Act tariffs. These are

really unique tariffs that the

International Court of Trade has already

or the Court of International Trade,

it's called CIT, has already decided

that both trafficking and reciprocal

tariffs, i.e. AIPA terrace exceed the

president's power. They already ruled

that on May 28th. The federal circuit or

the court of appeals upheld the CIT

ruling on August 29th. But on a 7 to4

decision, they benched their decision.

Basically saying, don't worry, you can

keep doing your tariffs until the

Supreme Court gets involved. The Supreme

Court on November 5th heard arguments,

but the Supreme Court does not make a

decision right after hearing arguments.

The Supreme Court's calendar starts in

the third quarter and it goes all the

way until June 30th. Usually the Supreme

Court in October, November, December

hears arguments and then they sit,

deliberate, and think about their

rulings. Those rulings typically don't

come out until May, June, or sometimes

you see them a little bit earlier,

especially if they have been filed under

an emergency appeal to the Supreme

Court. These lawsuits against Donald

Trump to decide the fate of the AIPARS

have been filed under an emergency

process. The Supreme Court has also just

set an opinion date for Friday, uh,

January 9th at 7:00 a.m. California time

to announce some form of a decision.

Now, it's not unusual for the Supreme

Court to do this. The Supreme Court

historically, like long time ago, has

generally made rulings on Mondays and

then they would release rulings

sometimes on uh, you'll see it on

Tuesdays and Wednesdays. they sort of

trickled them out. That has changed over

the last few years. Over the last few

years, we've seen a little bit more of a

shift where sometimes these rulings are

coming out on Thursdays and Fridays, and

you're really seeing a lot more of a

category result for when you're actually

getting these rulings. So, seeing a

Friday ruling isn't necessarily a big

surprise. It's pretty consistent with

what we've seen over the last couple

years. But this pre-announced Friday 7

a.m. deadline has a lot of people

thinking, "Huh, I think the Supreme

Court's about to overthrow Donald

Trump's AIPA tariffs, which is leading a

lot of traders, at least over the last 5

days here, to rush into stocks like

Restoration Hardware because they

believe that these stocks will be

massive beneficiaries of the repeal of

AIPA tariffs or basically the

invalidation of Donald Trump's

opportunity to use these." basically

saying that if the president wants to

use extraordinary action uh via

declaring a national emergency, he could

do a lot of things, but he won't be able

to issue tariffs. Instead, the president

will have to go to Congress to do that.

And that's exactly where the debate lies

on these AIPA tariffs. See, AIPA tariffs

are so useful for Donald Trump because

you can instantaneously apply them with

a simple executive order. I'm declaring

an emergency and I'm declaring the

tariffs. However, the big problem with

this and this is why the AIPA tariffs

are likely to be struck down, which then

raises the question of what happens

next. But why I expect the AIPA tariffs

to actually be struck down has first to

do with the major questions doctrine. on

major questions of vast economic or

political significance, Congress

specifically and clearly must provide

the power to do something to the

president. That has been done through

section 232 tariffs, those we've seen

through the Trade Expansion Act of 1962.

Those are like your steel and aluminum

tariffs or commodity tariffs. You can

make the argument for the 301 tariffs on

chips or, you know, Chinese phones or

consumer goods or whatever. You can make

arguments for those, but these

reciprocal or universal tariffs are not

clearly designated in the AIPA law. And

when something is not clearly designated

by Congress, the power rests with

Congress, not the presidency. And this

is where it is very important to start

looking at, well, what are Supreme Court

justices starting to say? What have they

said during hearings? So far what we've

seen is John Roberts, Gorsuch, Jackson,

Kagan, Sodtomayor, and Barrett all seem

skeptical that the do that Donald Trump

is able to use these tariffs. This

suggests that you might have a 63

decision given that those are six people

skeptical that Donald Trump is, you

know, not over that he may be

overstepping his bounce here. And that's

exactly what the Supreme Court is

deathly afraid of. They don't want to

allow what they consider a one-way

ratchet. Like, think about having a box

and, you know, you put the strap on it,

you ratchet it down, you know, you check

the tension on it. Once you ratchet,

click, okay, we're going to allow the

president to impose AIPA tariffs, you're

never going to loosen that box. In fact,

that is exactly what the Supreme Court

said. On balance, the court overall

appeared skeptical about the broad scope

of the government's claim to regulate

importation via IEPa. There are

mechanisms such as 232 and 338 that do

have restrictions and constraints, which

again is why Donald Trump doesn't like

those sections as much as the AIPAS.

Gorsuch himself says that we have a

one-way ratchet here that would transfer

taxing power to the president that

Congress cannot practically get back.

This to me sounds pretty bad for Trump

expecting a win on these tariffs. I

don't actually think people are

expecting a win on these tariffs and

that's why a thousand different lawsuits

have been filed to go collect their

money back which is expected to be

somewhere around $160 billion.

But markets broadly aren't going to so

much worry about these $ 160 billion in

my opinion. These are the lawsuits that

have been filed. Liberation Day tariffs

announced court of an international

trade was over here. Appeals court

tosses the tariffs over here. This is

the uh uh the federal appeals court

circuit supreme court. Here's the

arguments. And again now we stand these

are all the lawsuits that have been

filed. Notice that after the arguments

all the lawsuits started getting fired

filed because companies are like oh my

gosh the Supreme Court's going to rule

against Donald Trump. Which is actually

really rare. In fact, I have that

written down over here. I saved this

little piece. I'm going to grab it

because it's so rare that the Supreme

Court rules against the president uh in

terms of the people whom he's placed.

Look at this sheet of paper. I saved

this because I think it's so useful.

Alto Gorsuch, Kavanaaugh, they almost

all vote for Donald Trump's policies all

of the time. Trump's second term, Alto

95%, Gorsuch 95%, Kavanaaugh 89%, Thomas

89%, Barrett 79%, Robert 74%. Obviously,

Kagan, so Jackson barely vote for his

policies because they were appointed by

Democrats.

But the point is, this might actually be

one of those times where even the

Republican justices say, "Yeah, bro.

Nine or nine out of 10 times we vote for

you, we can't do it this time." And I

think that's why like this is almost

like a betting market of are the IPA

tariffs going to get kicked out? How

many lawsuits are being filed is showing

you that this is how many companies are

actually spending the money to file a

legal complaint because they actually

think the IPA tariffs are going to get

thrown out. So I broadly expect that as

well. I expect a ruling as soon as

tomorrow at 7 a.m. though it may take

longer. Ultimately, Donald Trump will

try to use other policies and that will

create some uncertainty for markets. A

lot of people are worried that we could

actually get a lot of uncertainty

because these other methods of utilizing

tariffs may not be as cut and dry in

terms of what their impact is going to

be. And I understand that. In fact, if

we go back to the very first chart we

showed, which shows a 100red-year policy

right here that has not been used

before, 338 or hasn't been used since

1930, you're really looking at more 301

or 232 tariffs. The problem with these

is 232 tariffs require the commerce

department, not only do they require the

commerce department to conduct a

feasibility study, which could take up

to 270 days, so basically 9 months, but

they actually invite more APA lawsuits.

Those are administrative procedures acts

basically saying, "Hey, commerce

department, you're like being unfair to

our company or whatever, right? AIPA

tariffs under emergency powers don't

invite as many lawsuits, which I know

sounds ironic to say because now

everybody's piling in, but they're only

piling in because it sounds like the

Supreme Court is about to ban them and

people want their money back. So,

they're kind of betting on the team

that's already winning, right? But

typically, if you lose this,

this is a lot easier to win a lawsuit

in. Uh, and it certainly is a lot

slower. So, Donald Trump's going to get

slowed down a lot. Now, a lot of people

see this as actually creating more

uncertainty for the markets. Oh my gosh,

are we going to get a liberation day

2.0? And of course, this is where people

also argue, well, you know, these

tariffs are regulatory. They're not

revenue raising. I mean, it's fair, too.

And I don't want to sort of labor the

points of revenue raising. uh this this

going to be a debate, but frankly the

justices have already ruled that sure

you might just call them licenses as

opposed to being revenue raising or

taxes, which is what Congress does. But

let's be clear about that. Nowhere in

our documentation for AIPA tariffs are

license fees authorized. In fact, they

specifically say IPA

authorizes licenses but not license

fees, which is really interesting. But

it's worth noting that the arguments for

these AIPA tariffs are really, really

weak. And I think that's why the Supreme

Court, not only because of major

questions or the fact that you're not

going to be able to pull this ratchet

back from Congress or or from the

president if you give it to the

president, the license fees argument and

what we're seeing statistically with the

lawsuits. To me, this is a betting

market saying these AIA tariffs are

dead. And yes, people are going to be

concerned. Oh my gosh, what alternatives

is Trump going to go for? I personally

hope in a bullish scenario as an opinion

that the Supreme Court will just slam

the door shut on other alternatives

like, "Hey, they really narrowly define

what the president can and can't do."

They probably won't do that, though.

That's mostly because we've seen Justice

Kavanaaugh say things like, "Well, if we

have lawsuits under other sections, then

we'll deal with those at that time."

Which means the Supreme Court is more

likely to just kick the can down the

road on answering all of the questions

in total. Now, what does all this mean?

Even if the Supreme Court bans the AIPA

tariffs and then there's some

uncertainty in markets, what does it

mean for our economy? Yes, there is a

risk of a liberation day 2.0, but it's

an election year. And so, I actually

think that will be less likely. I

actually think the overthrowing of the

AIPA tariffs could be one of the most

>> bullish catalyst,

>> bullish catalysts of the entire year

because it means all of that extra

margin compression baggage that

companies have been holding on to

evaporates. Maybe not all of it because

we still have se other sections, but a

substantial majority of those tariffs

evaporate. That is immediately

deflationary. Not only is removing all

this crap immediately deflationary, but

new tariffs are going to take a lot more

time. Trump can't just use an executive

order for the other tariffs, and it will

be very unpopular during midterms.

Donald Trump will be much better off

saying, "Well, I tried. We collected so

much money, but the Supreme Court take

that took that money away from you, but

I'm such a nice guy. I'm still going to

try to get us stimulus checks. Let me

see what I can do. vote for me in

midterms. It's going to delay him

though. It's going to delay him until

after midterms. You're going to have to

vote for both the House and the Senate

in order to get your STEMI check.

Otherwise, I don't think we can do it.

You know, the Supreme Court, they

delayed it. It's their fault. Uh they

made a mistake. And uh and and you

should be upset with them, not with me.

Whatever. Like, Donald Trump will play

his song the way he always plays his

song. It's never going to be Donald

Trump's fault. But folks, this is

gamecher for our economy because it

gives the Federal Reserve the license to

cut cut cut. As the Federal Reserve cut

cuts, we can hopefully rejigger this

soft landing. We can hopefully get that

yield curve to compress. We can

hopefully get rates down, which is going

to be great for mortgage companies and

refinancing. It's going to be great for

the soft landing. And ultimately, it's

bullish for margins at corporations. So

this AIPA tariff decision could change

everything because it would be too

unpopular to go for liberation 2.0 in a

midterms year. Therefore, I could not be

more excited about the likelihood of

these AIPA tariffs getting crushed. Now,

what if we don't get a decision

tomorrow?

That's possible. We might not get a

decision tomorrow. I hope we do. But if

we don't, we might have to wait.

Hopefully, we get a decision in January

or February, given that this was filed

under an expedited process, but as with

everything, there is no guarantee. So,

in the meantime, if you want to see my

top 10 stocks to buy over the next 10

years, use my birthday coupon code

available at meetke.com. Join the Meet

Kevin membership. [music] It is part of

my thesis of the stocks that will do

great over the next 10 years, not

necessarily the next year or two. I

think there's time to buy them. But

stocks, well, some of them are already

taking off, which is a problem. But I

think these are the stocks that you

don't have to worry about a chip

recession in because I'm set up for the

next 10 years. Take a look at them over

at meetke.com. No guarantees, obviously.

I don't know your personal financial

situation. I wish you the best out

there. Good luck and God speed.

>> 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

[music] 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.