Trump's Bessent FREAKS OUT at Fed

It is really entertaining how they

pulled that off. But let's listen to

that Bessin clip here because this is

the Bessant clip apparently where he

gets pissed about Powell and I'm pissed

too.

>> He said that he also said the stock

market was high. I don't know why he

said that and why he would wade into

that territory. But what is your thought

about the macro story right now? I want

to get your take on where we are with

regard to economic growth and what's

ahead. Uh well, clearly the Fed Federal

Reserve has been uh too high for too

long and we're going into an easing

cycle here and I I'm not sure why Chair

Powell has backed up a bit here because

you know as we can see uh we inherited a

mess and it you know it's unclear now

we've had almost 2 million 2 million

downward revisions in the jobs number.

you know, there there was almost no

private job creation in the Biden

administration. And, you know, with

these revisions, we know that something

was wrong beneath the hood. And now we

could see in terms of the housing market

that affects consumers, working

Americans, rates are too restrictive.

They need to come down. And I I think we

will go into a cycle. And, you know, I

I'm a bit surprised that the the chair

hasn't signaled

>> Wait, wait. I think we will go into a

cycle. Also, shout out to Crypto Lifer

on the chat. Just just donated a $100,

dude. Thank you. Y'all are y'all are

just nice people, you know. Thank you

for that. Uh but uh yeah, I I mean, this

is interesting. Besson saying, "Hey, I

think we're going into cycle." You know,

this is it's something I talked about to

course members this morning is the thing

is I I one of the things I talked about

is don't go shortterm calls right now.

There's too much uncertainty between now

and at least the middle of October. Why?

Because government shutdown Monday and

and the Democrats are probably going to

lead to a shutdown, which is fine. I get

it. This is their version of negotiating

and it's what Republicans would do as

well if the rules were reversed. It

happens all the freaking time. On its

own, a government shutdown doesn't

freaking matter. But that comes at the

same time as uh actually the government

shutdown technically would be scheduled

for Wednesday because it would be

October 1st. Uh you have ADP coming out

on Wednesday as well the jobs report

which is is actually expecting decent

numbers right now. You know somewhere

around 54,000 which would be great

because you know we had a 50 actually I

think it's 52,000 is the estimate now

and 54,000 was the prior which is great

for ADP. Then you've got the jobs report

on Friday. This is a really intense week

of catalyst. And usually what the market

does is we'll look at like really bad

job numbers like 22,000 for August and

we'll be like, "Oh my gosh, these

numbers are absolutely terrible.

Let's keep going up in stocks and then

we, you know, the markets just sort of

buy the dip, whatever dip there is." I

mean, the S&P 500 has not had a minus 2%

day for 107 days in a row. That's rare.

That's, you know, clearly a very bullish

cycle. So, uh, you know, you've got to

get through this poopy dupy here. But

the the point is the market has had this

tendency of taking these bad job numbers

and just going, "Ah, whatever, bro. It

ain't that big of a deal." And so, what

ends up happening is you have this bad

job number read, market panics for a

moment, and then goes back up. It's what

happened with the August job numbers.

Then we get these massive 900,000

negative revisions which Besson is

saying over a year is about two million

which is correct and then market's like

whatever it doesn't matter. Well it all

just quote unquote doesn't matter until

it does matter. But in the short term

that's the way the market is playing

this. You get frantic about the data

going into it. The data comes out people

have a heart attack and then people just

go back to partying because you know you

get great earnings at Alibaba who's

increasing their capex. Micron who's

increasing their capex. We did a great

analysis on Micron this morning by the

way going through their 10K 10Q and

earnings call and we broke that all down

in the Meet Kevin app for course members

which is great because now you can

literally search by ticker symbol and

see my latest analysis uh if if you're

part of the Meet Kevin membership which

is kind of like a cool new feature we

added which basically just added it. Uh

but but Besson is right that like why is

Powell walking back

uh on on this you know three rate cut

SCP and not really highlighting uh that

we need rate cuts when we are going into

a quote unquote cycle of painful

employment numbers. Remember all you

have to do is look at the 27 weeks

unemployed number to see that this is

not like the mid9s. People keep

referring to the mid9s and uh the mid9s

didn't have this trend in 27 weeks

unemployed. Now maybe this time is

different, but look at 27 weeks

unemployed. You barely had a move here

in 1995. The downtrend was very very

clear. Any any 5-year-old could tell you

that the trend in the '9s on 20

long-term unemployed was down. What do

you have right now? Up. What do you have

every single time you have a recession

in uh 27 weeks unemployed? Trend up,

skyrocket, trend up, skyrocket, trend

up, skyrocket, trend up, skyrocket,

trend up, skyrocket, trend up,

skyrocket, trend up, skyrocket, trend

up, skyrocket. You get the idea. Okay.

So, like, as much as I think politicians

are all scum shills for for their

parties, I will always first of all try

to piss you off because I I don't want

anybody to like me. And second of all, I

want you to know that I'm gonna call

these people out all the time. But damn

it, this time Besson's right. What the

hell, Powell? That you we

have a destination before the end of the

year of at least at least 100 150 basis

points. And I I will add, you know,

President Trump's pick for the Federal

Reserve Board, Steven Meyer, Stephen has

said more in a week, more in a week than

the Biden administration appointees have

said during their entire tenure.

>> Yeah.

>> Uh, in fairness,

he's also kind of right about this. Myin

loves this economic data. I'm blown away

with how analytical this knucklehead is.

This guy is majorly analytical. I mean,

he's talking about the elasticity of 50

basis point cut

>> and I actually think it's brilliant. I

mean, just to give you a really quick

primer on that, Myron basically says,

"Hey guys, here's the thing. Uh,

you know, the company or the country

that benefits from tariffs is usually

the one that has more demand elasticity

where you have choice. Like for example,

if you need a life-saving medicine like

or maybe not life-saving, maybe it's

like the only thing that works for your

skin is dupixent. Let's say nothing else

works. You're you're very inelastic. You

have no other choices. So you must buy

that medicine. So as price changes, your

demand, your quantity demand, it stays

the same. That's very inelastic. So

you're you're like a stiff rubber band

and you're like, uh, I don't care what

the price is, man. I just need it. Uh

whereas like when we're buying stuff

from stuff from China, a lot of it yeah

we we can get in other places. He's the

first person from the Fed to make that

argument that as a result manufacturers

are more likely to pick up the impact of

tariffs. Now I don't know that I 100%

agree, but it's a clever argument that

nobody's made before and I'm actually

supportiveness.

So like trust me, my first impression

was Myron was gonna be the biggest Trump

shill ever. He's kind of he's still a

shill, but he's impressed me. You know,

I gotta give him credit here.

>> You know, uh Jay Pal cut 25 basis

points. Steven Min wanted 50.

>> Well, these meetings are supposed to be

a discussion. You're supposed to have go

in to them with an open mind. And you

know, I I think not not unlike the the

UN, we we've seen a lot of mistakes, a

lot of rigidities, and uh you know, it's

good to get some new blood in there. Who

who would be your best pick for uh

chairman of the Fed at this point?

>> Uh Marie Maria, I'm interviewing 11

candidates. Uh we've got a couple who

have surprised me in in the strength of

their candidacy during the interviews.

Okay.

>> And I

>> Who surprised you?

>> I'm sorry. I'm not going to talk

specifics.

>> So, you don't want to break that news

right now?

>> Uh Maria, if I could, I would cuz you're

you're you're my favorite. But of

course, of course, she's the favorite

because it's Fox News. And remember,

there's a revolving door of people who

work in the Trump administration who

then go work for Fox or people who work

at Fox and then who go to Trump. And

this is why Trump wants the Murdoch

uh to be involved in the Tik Tok

investment so they could tune the

algorithm to Trump.

That is dangerous, mind you. That is not

good for free speech.

It is the same thing that yes, the Dems

did in 22. I'm saying it's both bad. I'm

going to be interviewing more candidates

this week. We respected the Fed's quiet

period and we didn't interview any

sitting Federal Reserve board members or

presidents. So, there's going to be a

lot of interviews next week. I think the

first round will be done f first week of

October. then we'll we'll start another

round and I I look forward to being able

to discuss it with President Trump

present him with three four very strong

candidates.

>> Do you think given what we've seen in

the labor market for the last three

months? You know, we've seen this

weakening in the last three months. I

don't know if you believe the numbers or

not at this point, but do you think that

tiptoes into recession at some point?

>> I I am less concerned about a recession.

I'm I'm concerned about the

distributional aspects that we've got

going here. You know, I'm concerned that

work working working Americans are

getting hit harder just because of the

high rates. I'm concerned that a lot of

the housing affordability crisis uh is

on the mortgage side. So, uh you know, I

I am very concerned and I I believe that

we we do need rate relief. We need to

get at least back to neutral.

>> Isn't it odd that when you talk about

lower rates,

>> he's basically saying like, hey, it's

uneven, right? like you've got this big

AI boom that's preventing a recession

essentially. Uh but you're hurting so

many Americans because these higher

rates are, you know, crushing, as we

always say, like the bottom 50%.

>> It said the Fed expected to cut another

time at least at least once more that

rates go up. I mean, do you think it's a

certainty that as the Fed lowers rates

that you're actually going to see a real

impact on, for example, mortgage rates?

Uh I I I do believe that we are are

seeing uh we'll see a substantial drop

in in inflation. I think that the the

housing numbers are done through imputed

rent that we're going to see they run on

about a six-month lag. Everything that

President Trump is doing in terms of

deregulation, which I think is the

underrated the third leg of his economic

policies, you know, that's all

disinflationary. And you know, we'll see

what happens with this AI boom. You

know, back back when when the railroads

came in, we had this wonderful

inflationary growth. The at the end of

the century, we had the same thing in

the 1990s. And everyone asked me, "What

am I looking for when I interview

potential Federal Reserve chairs?" And

it's just someone with an open mind.

someone with an open mind who's not

looking in the rearview mirror, who's

looking forward, who thinks maybe this

could be like the 90s where we saw the

office electronics came in, we saw the

internet boom, so could the AI boom be

like that? Could we have a

disinflationary period? Uh, you know,

could is our star, if it exists, going

to move up or down? Uh, you know, what's

NEU? So, I I want somebody who's looking

forward, not backwards. I mean it's it's

such a it's such an interesting scenario

to look at AI because on the one hand

you know that AI is going to replace

some jobs right I mean obviously um but

on the other hand we didn't know we

needed coders 20 years ago we didn't

need we didn't know we needed all these

engineers so other jobs even in energy

will be created but do you have a plan

for those jobs that will go away as a

result of artificial intelligence

>> uh Maria we we don't we're working on it

now we actually have what I call an

AISAR at Treasury and she is de

developing a plan, a roadmap that can

help us with the US economy. I'll be

talking about that in speeches uh this

fall and we we don't know which way it's

going to go and again I think we got to

have an open mind. But one of the

things, as you know better than anyone,

President Trump's trying to bring back

precision manufacturing jobs to the US,

this bluecollar boom that we're going to

see and those jobs aren't going to be

taken by AI.

>> Yeah, I I love what President Trump is

doing with the supply chains. It is so

important and I understand this is

national security. We're all wondering

if there's sort of an outward outlier

out there that is going to turn things

around and I want to get your take on

Argentina because Mr. Secretary,

Argentina's peso sliding.

>> Yeah. So, we'll talk about Argentina

separately, but I mean, think about what

he's basically saying here is like, hey,

we don't have a plan for how to

basically help that lower uh income

American or the person who's going to

lose their job to AI.

The only plan is cut rates. That's the

plan. The plan is pressure the Fed to

cut rates because there's nothing we can

do.

That's kind of also a little bit scary,

right? Because now we look and we say,

"Okay, great. So, our government

isn't going to invest in trade schools.

They're not going to invest in better

education." they're going to cross their

fingers and go, "Well, hopefully we

don't go into a recession, but we don't

know what to do about all the people

that are going to lose their jobs."

Hopefully, we'll be like the mid9s

where, you know, people uh had a uh

what's it called? Um uh you know, people

were able to find new jobs and and we

didn't end up going into recession. We

got a soft landing.

understand that's the mission of the

Trump administration is hope that the

policies that they've instituted such as

the big beautiful bill uh and tariffs

and uh you know these these and some

form of deregulation. Those three things

combined lead to hopefully

uh lower debt for the United States. I

wouldn't bet on that at all. They'll

spend that all away right away. Uh it's

like, "Yay, we're collecting three to

$400 billion in tariffs. Cool. But we

also just spent $3 trillion on the big

beautiful bill." So, well, there goes

nearly 10 years of that tariff revenue.

So, don't expect the debt to get paid

down. But instead, be hopeful that tax

benefits, infrastructure spending lead

to hiring. We need a resumption of

hiring. This is what a lot of people say

is that there will be a tailwind in uh

the business cycle because companies

will go from wow things are so uncertain

right now because of all these like

tariffs and the taco and tariffs and

taco that people will really like oh

let's just wait let's not hire and

there's this hope and that's all it is a

hope it's not the best strategy but

there's this hope that businesses will

say all right we get it we know what

terasaur. Now we're going to start

investing in hiring again. Okay, that'd

be great. Businesses can start doing

that. Start creating new jobs.

Fantastic. We soft land. We're good.

27we unemployed levels can start coming

down. And Bessant sees the only way

forward as a Powell who's going to be

supportive of rates coming down to

enable maybe small businesses even to

create those jobs. I mean, think about

it. Small businesses, they would be the

biggest recipients of lower interest

rates and they would be able to hire

more. So, I could see why this is their

only strategy. It's like they it's

almost like what Powell said. Yeah. The

only tool on our tool belt right now is

really rates. Okay. So, why not more

guidance on what you're going to do? You

went from a SE that said three cuts to

not mentioning next the next periods of

cuts at all which led the market to go

bearish you know after the the Powell

meeting which is what I said in the

alpha report to course members I'm like

look you need a you need a dovish Powell

to go green or to stay green or go more

green and we didn't get a dovish Powell

we got a neutral pow it's the worst

evolution of Powell the neutral Powell

we don't want neutral we want we want

bullish so I get

I get where Besson is coming from and

that's why Jamie Diamond says hope that

they pick a good Fed chair for next

year. Honestly, I wouldn't be surprised

if they pick somebody like Myron. Myron

potentially has more

uh sway like he I feel like he's a very

convincing debater. You look at somebody

like Waller, a little more old school, a

little more like I feel like he's a

little more like Texas, like well, you

know, we we ought to cut rates 150 basis

points to get back to neutral. Oh, okay.

Well, why do you think that? Well, you

know, the disinflationary process is

continuing.

And that would sort of be like his

argumentation. Whereas, you know, you'll

get somebody like Myron who will just

like I mean, even Sarah Eisen shuts down

when Myron's talking because he's

throwing so much economic data in

theory. And it's great because at least

he has like something that he stands

behind. Uh but uh you know, when Sarah

Isaac glazes away, we're like, "Oh man,

this is too much. We're not talking

about that elasticity of demand.

I I I I don't think I can unsee that

face that she had. That's how you know

you've got somebody who's so convinced

in their data. They're like nerding out

over this data. Uh you know, he could

end up being a better chair picked and

technically he could get picked for the

chair. It might be Myron. I feel like

this is a dress rehearsal. And if you

get Myron, man, he's going to push for

Ray Cuts. It'd actually be the most

bullish scenario. You don't want Hasset,

who's a wet blanket. You don't want

Kevin Walsh, who is, you know, an

anti-Quey when you need it person. Uh,

Waller is good, but Myin might be great.

My take 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 Papra there, financial analyst and

YouTuber. Meet Kevin. Always great to

get your take.