GLORY!!!! **Excellent** NEWS!

holy smokes thank the lord oh my gosh

this morning's labor report was so good

because of what was deep inside of it

not because of the headline numbers but

what it means for the fed rug poll folks

we gotta talk about this unemployment or

employment report and why the market is

still going to poopy dupes

we're gonna talk about that right now in

this video and if you need

any solution for your stresses remember

just go to medkkevin.com life to make

sure you sign up for life insurance you

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despite the fact that we're still in

pandemic and there's a war going on

medkevin.com life okay folks this

employment report was amazing

and it again was not just because we had

about 250 000 more jobs than expected

the bloomberg survey had us at about 423

000 jobs uh the unemployment rate

falling to about 3.9 percent we ended up

getting about 678 000 jobs unemployment

rate falling to 3.8 great fine whatever

uh and most

sectors gaining i mean almost i i don't

think there was actually a negative

sector here leisure hospitality gained

the most 179 000 food and drinking

places within that umbrella 124k

professional business services 95k 64k

healthcare construction 60k i mean the

economy is still hiring like absolute

bonkers now i'll tell you

this data was collected in a particular

week within february and you're going to

want to know what that week is but i'll

tell you that right after i tell you

this

now to really understand what the heck

happened in

february which is the report we just got

we've got to understand what happened in

january and why it was such a disaster

in terms of what it could have signaled

to us so in january earnings went up 23

cents this was that blue section right

here 21 cents or 23 cents rather

all the way up to 3163 31.63

so these are the average hourly earnings

now in order to understand how much this

actually went up the correct thing to do

is actually minus 23 cents here so you

end up with the old number

now you can do a little bit of division

and it's quite simple you just divide

the current number by the old number and

then you're going to get a number that

starts with 1. so i'm going to divide

this 31.63 divided by 31.4 and i get

1.00732

1.007

now what we're going to do is we're

going to subtract 1 from this so we get

rid of uh so we just have the difference

left and then we're going to multiply

the rest

by 12. so we're going to subtract off

one and then really what we're just

multiplying by 12 is this here right so

we're going to multiply

0.00732

times 12 and then we get this number

that looks like this 0.088

i'm rounding a little bit here which is

basically an annualized wage increase of

move the decimal eight point eight

percent that's insane okay that is

really really high especially because

last month inflation was seven and a

half percent this means the start of a

wage price spiral which is very very bad

for that to continue because that

basically means workers have more power

to demand more wages more so than prices

are actually going up and it could start

a self-sustaining cycle of inflation the

director of the university of michigan

consumer sentiment survey said that we

are seeing evidence of a start of a con

a wage price spiral that is decoupling

from supply chains which means even as

supply chains get better and prices go

down wages could just keep everything

getting worse and worse and worse that's

like

literally crisis mode worst case

scenario the federal reserve will force

a recession pure fud pure disaster

everything goes to heck very very bad

well folks guess what happened here

average hourly earnings

of all employees

were 31.58

little changed after large increases so

they stayed flat but wait a second wait

a second this says 31.58

but wait the last report we had

said wages went up to

31.63 and going up to 31.63

was equal to an 8.8 percent increase

that's why we were freaking out about a

potential wage price spiral but wait a

minute now they just went back and said

no no no wages actually last month were

uh 31.57

we went back and revised it and changed

it

and now they went up one cent to

31.58

like wait a minute wait a minute wait a

minute that's actually doubly good news

so what you're saying is wages did not

go up

to signify a wage price spiral in

february and this is not to say we don't

want people to make more money right

it's just to say like in terms of an

inflation aspect this is good like

they're up but they're stable

but you actually revised them down so

last month we actually only had wage

growth of about 6.6

which is actually less than the

inflation rate which is not a signal of

the wage price spiral so not only do we

have no wage growth now but last month

you took away the wage price spiral that

you said there was

so you said you were wrong last month

and now you're revising the data saying

no no never mind last month wasn't even

that bad okay like wait a minute this is

actually really good news this is really

really good news because

the biggest fear the federal reserve has

in my opinion is the potential start of

a wage price spiral where they have to

force a recession and then we have to

start fighting the fears of potential

stagflation what does this now mean that

the federal reserve could potentially do

well they they have two options here

they could potentially be more hawkish

maybe they could raise rates more right

because the labor market's doing so well

but i don't think they're going to do

that because

we're actually seeing wages flat and now

we're already seeing people's purchasing

power go down because we're going to get

you know look we had 7.75 inflation last

month right

six point six percent was the actual

weight annualized wage growth for last

month which means a reduction in

purchasing power this month wages or

last month you know feb uh compared to

january anyway feb wages stayed flat

which means again a reduction in

purchasing power

so why would the fed decide oh this

report is going to make us go more

hawkish it likely won't the fed's likely

going to stick with their 25 basis point

hike hike hike this report reiterates

great we've got a stable labor market

but not one that's running away to where

we have to be aggressive

and try to dampen how much wages are

going up nope that is not a problem

anymore which is really good news

because it substantially reduces the

chance of the federal reserve's rug pull

on top of that

you

probably if anything are going to keep

the fed in a little bit more of a dovish

direction to try to support the labor

market as much as possible

while trying to control overall headline

inflation and so in my opinion that is

that course of 25 basis point hikes

consistently so to me this is actually a

great news this is a very good report

i'm very very happy about this but not

everything is good because unfortunately

buried in this report we find out when

this survey was actually taken and

unfortunately this survey

not that necessarily it's going to make

a difference but this survey was taken

around the 12th day of the month which

was about 12 days before the russian

incursion i'm not sure how much the

russian incursion is actually going to

affect hiring but this report does not

give us any indication either or like we

certainly don't have any russia drama i

should say priced in to this report so

that is uh that is worth noting that

next month is when we'll actually see

what impact russia is potentially having

on our jobs market so that is an

asterisk and an unknown however the

stock market

cared momentarily in fact if we look at

the pre-market here we could see this is

the nasdaq technology here

we had a nice little bump on the jobs

report

not much but we definitely saw a bump

here unfortunately this all got sold off

because of fears uh that russia has

taken control of a nuclear power plant

this is not like a nuclear weapons plant

it's a power plant

in a specific region in ukraine

unfortunately this is also that city

where we saw thousands of individuals

line up trucks and sandbags and tires

and stand there to defend the glory of

ukraine well unfortunately that facility

has been taken over by russians

and this is leading to

increased fear that potentially

this this war is going to drag on much

longer that putin has no interest in

negotiating a ceasefire as we've seen in

negotiations over the last day and

unfortunately that this could continue

dragging on and out which is terrible uh

it's it is exactly why we are seeing

wheat

our index here for wheat skyrocketing

let's go to the day chart here look at

this you're probably up about 50 to 70

percent here which makes sense because

wheat prices are up about 70

year-to-date which is wild and most of

that has happened within the last 30

days specifically because of the

incursion in ukraine because of a

substantial amount of wheat exports that

come from ukraine now the wheat harvest

is not actually until august

so

if this crisis is over within the next

month or two and uh too many wheat

fields were hopefully not destroyed well

let me make sure i said that correctly

let's hope many wheat fields weren't

destroyed then i would expect wheat

prices to plummet very very very quickly

so if you're short-term speculating on

this great but just know when this turns

it's going to turn fast

so just just bear that in mind

now it's it's also worth noting that uh

some riskier plays are selling down

right now uh upstart open door qqq look

at how you've even got dave and buster's

coming down five percent sofi kills it

on earnings and just plummets here a

firm falling right so there's a lot of

pain in these more profitless riskier

sections uh and and that is normal uh

that is normal this is the kind of

market where i do think it's a mistake

to get into the riskier uh a profit uh

companies uh and it's a mistake that

i've made as well i i try my best to

limit the mistakes that i made and

recognize them when i when i do make the

mistakes but what i'll do is i'll do a

portfolio update for everyone

yeah in a different video and we'll take

it from there so anyway happy to share

this good news thanks so much for

watching and folks we'll see in the next

one