Did Trump JUST Cancel the Recession

has the stock market bottomed or are we

in for more pain in this video I'm going

to tell you two reasons why markets

might be really excited about some great

news coming and here now but we'll also

talk about some lingering issues first

yes the government is not going to shut

down at least between now and September

30th 2025 which is great news because it

means we got another 6 and A2 months not

to worry about this government shutdown

crap if there was ever going to be a

government shut down honestly I thought

it would have been now but hey we got

Chuck Schumer and enough Democrats to

say you know what this is not the fight

that's worth having so we're not shut

down markets have been expecting this

now for about the last 24 hours and some

say the market rallied because of that

expectation but others say it may have

been because of the posts and threads of

Charles gasparino which could suggest

that Donald Trump might end up getting

either pushed or convinced or otherwise

up with the idea himself to come up with

an FDR style solution to the Tariff

trade Warfare that essentially Donald

Trump created uh similarly to how FDR

solved tariff Warfare in 1933 and 1934

during the Great Depression now in case

you don't remember that era because you

know it just doesn't feel like yesterday

anymore don't worry remember that in

early in the early 1920s when the

economy was booming we issued tariffs

and then we issued more and in the early

1930s we issued the smooth Harley

tariffs but then we were already leaking

into a depression and once we were in it

we're like you know what maybe tariffs

aren't the best of ideas so what ended

up happening well if you take a look on

screen now you'll find that there was a

new deal era trade policy Now new the

New Deal itself was related to domestic

policies and government spending to try

to get people uh you know work the

work's progress administration blah blah

blah blah but what we also got out of

this era was a new deal era trade policy

and this is where FDR in

1933 tried working with a group of 66

different countries in London to try to

figure out how to get out of this Global

depression reduce trade barriers and

ultimately stabilize exchange rates

since people were still fighting about

whether or not to leave the gold

standard Great Britain did you know the

United Kingdom did but the United States

didn't for another 40 years and all this

but anyway FDR ended up asking Congress

for authority to negotiate trade

agreements based on reciprocal tariff

reductions boy doesn't history just

rhyme sometimes reciprocal tariffs yeah

anyway but in this case rather than an

increase in tariffs reciprocal

reductions you reduce 2% I'll reduce 2%

kind of interesting and that Authority

was signed into law in

1934 shifting us trade policy forever

allowing the United States to reduce

their trade tariffs previously

authorized by Congress in negotiations

with other countries this is a big deal

it's the opposite of what Trump is doing

now but Charles gasparino suggests that

maybe Donald Trump could end up being

part of some kind of grand scheme or

plan to resolve tariff disputes with

Mexico Canada and Europe and others

especially before the April 2nd deadline

where we expect to see a lot more

tariffs especially on every sort of

automaker whether they're South Korean

whether they are Japanese Chinese being

manufactured in part in Canada and

Europe doesn't matter and so Charles

suggested that after the market losses

that we've seen this week there may be

pressure on Trump advisors by corporates

the words corporate leaders to encourage

some kind of solution or deal that every

body could be happy with and maybe we

could actually end up with a better

situation in the future much like FDR

however a person close to Donald Trump

said unfortunately this is not being

discussed at this time but that's okay

we know how rapidly things change with

Donald Trump and markets seem to be

suggesting that as long as there's

enough seed planting maybe Donald Trump

will wake up one day with this magic

idea of reciprocal tariff reductions

nobody will have given him that idea of

course it will be entirely his idea idea

and then we can actually get out of this

insane uncertainty this of course

coupled with enthusiasm over potentially

a Ukrainian ceasefire has created some

real optimism for the economy at least

in markets today now does that

necessarily mean the broader economy is

optimistic not necessarily in fact we do

have some leftover problems that we have

to talk about and I think it's worth

addressing them one at a time First Bank

of America noticed that usually yields

and the NASDAQ going down together as

opposed to going up together or one up

one down doesn't put us into a very

common place in fact this has really

only happened these times over here

these four times you do have a couple

Edge scenarios here but you'll find with

the label dates we're actually more

similar to where we sat in 2000 2002 and

2008 then where we sat in the mid 80s or

the mid90s where people saw soft Landing

or enthusiasm in markets the recovery of

24 of 2009 of 99 leading up to the dotom

bubble of the mid 70s of 2022 where we

had bottom we didn't actually H relate

to any of or we don't currently relate

to any of those in fact we relate more

to the pain of the.com and great

financial crisis which isn't fantastic

it's also not Finance fantastic that

consumer sentiment absolutely plummeted

today to to a level that we just haven't

seen before I mean this morning with

course members when the consumer

sentiment numbers came out we were

joking we're like oh man are we ready to

see Ricks you know start going off about

how bad these numbers are oh this is the

worst since July 2022 and sure enough

that's exactly what he said it was

comedy it was great comedy this morning

but they were really shocking numbers in

fact the numbers were so shocking that

we haven't actually seen numbers this

bad on consumer optimism on the labor

market since basically any prior

recession so look at this what are the

numbers similar to well they're similar

to

coish co co was a little unique because

it's so rapid right you don't really

forward look expectations so you don't

actually really have that Brown Line

which is the brown line is the

University of Michigan uh and then the

gray is actual payrolls so you actually

let me correct that not since Co the

last time you've actually seen

expectations sour this much was in the

great financial crisis in 2001 in 1991 1

in 1982 and in 1980 which I hate to say

it for what do 1980 1982 1991 and 2008

all have in common which is the same fat

warning sign we're getting right

freaking

now

recession now this is just one chart so

you have to take it with a grain of salt

take a deep breath people's expectations

can change we know this now a lot of

people also look at this University of

Michigan sentiment survey and they S

Suggest oh well you know that's a bias

survey it's over amplifying the opinions

of Democrats but that's okay we actually

have a number for specifically that as

you can see here Democrats are the light

blue line and Republicans are the dark

blue line here uh and what you'll find

is in each of the categories you

actually had a substantial downturn in

consumer Outlook in fact commentar

suggest that consumer sentiment slid 11%

this month with declines consistent

across age education income wealth

political affiliations and geographic

regions current economic conditions were

considered leg little changed but for

future the future deteriorated across

multiple facets of the economy whether

it was related to personal finances

labor markets inflation business

conditions the stock market everything

and it didn't matter whether they were

Republican or Democratic these were the

highest inflation expectations in 32

years now you know me I don't actually

think we're going to see a major second

wave of inflation mostly because I think

if we dunk into a recession we'll have

the opposite we'll have depression and

deflation Larry Summers today came out

and suggested he sees a 50% chance of

recession and that risk grows over time

he not only tweeted this but also went

onto a CNN interview I'll spare you of

the interview but he says that CEOs

consumers and markets are looking for a

stagflation scenario but you might have

a lot worse than the Stag you might end

up getting uh you know an actual

recession here but Larry Summers

believes that recession risk while they

might be a coin toss today the longer we

have as he says somebody crazy driving

the car in a crazy Manor you know he

could stop and start driving normally

but the longer that happens the more

recession odds go up every single day so

Larry summer is not exactly the most

optimistic also if you look at corporate

mentions of soft Landing they've

plummeted we used to say the word soft

Landing a lot in fact almost throughout

all of 22 2023 and 2024 corporations

mention soft Landing a lot in their

earnings calls those mentions have

absolutely evaporated in January and

February and US policy uncertainty is at

levels we have not seen in quite a long

time in other words uncertainty is very

high there are also little early warning

signs such as people spending less money

when they go get gas on snacks or

miscellaneous Goods at the gas station

Walmart is complaining about people

spending less money on larger purchases

at the end of the month suggesting

budget

tightness tiny bottles of liquor seeing

their sales way up versus larger bottles

last minute bookings for flights are

down labor market stress is easing and

frankly keep this in mind while

everybody likes to talk about

unemployment claims they lag like crazy

especially since it takes time for

people's Severance to wear off and for

you to even become eligible if you ever

will be for unemployment

insurance on top of that it is worth

remembering that you are seeing a

cautious mood from corporates at JP

Morgan's annual conference companies

said that people are stretching out

their timelines including like 3M and

other manufacturer saying that people

are taking longer to accept delivery for

their products they're asking for delays

and a lot more I personally don't really

love the whole Dow Theory but there is a

dow theory that the Dow Industrial

Average can basically you know be

confirmed to be trending towards a

recession when you look at the leading

indicator of the DOW Industrials falling

or sorry the Dow transport index

falling both of them have been falling

the Dow transport index is down about

177% since November and the Dow JNS

Industrials down about 7% since November

both of these falling together the

transports falling more suggests that

there could be more pain ahead however I

don't think this is a a very reliable

indicator and today I don't really think

of it as super useful anymore just

because we have so much of our Economy

based on Services spending today Clara

filed for IPO and what was interesting

about Clara is if you look at their

earnings it's actually kind of funny if

you look at their 2023 earnings they had

69 cents of earnings and they're like

nah let's not IPO now if you look at

their 2024 earnings they had one penny

of earnings per share so in other words

they went from negative 769 cents per

share good one to positive 1 cent as

soon as they got to positive 1 Penny

what happened all right boys and girls

it's time to IBO I mean good for them

but here's the document for the year

ended 2023 or 2024 you could see that

EPS right here loss of 69 gain of 1 cent

ding ding ding time to go

public

brilliant I think it's funny uh anyway

uh our yield curve spreads though we're

still only at 29 and a half suggesting

we're nowhere close to shock or credit

stress some people are talking about

some level of stress increasing I'm not

really seeing it just yet it could get

worse it always can so we're not seeing

the signs of true recession panic yet

and this is why I keep saying you know a

lot of this this decline we're seeing in

the stock market in my opinion is not

based on a recession being priced in but

rather it is based on the uh the true

worry about tariff uncertainty again not

recession so that's my take anyway I

really appreciate you all watching I

hope you have a fantastic weekend love

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we'll see you in the next one goodbye

and good luck why not advertise these

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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 PA there financial analyst

and YouTuber meet Kevin always great to

get your take