WARNING: Businesses are Collapsing | Depression Confirmed.

businesses are collapsing but rather

than give you hyperbole I want to show

you actual facts and statements made by

companies over just the last few weeks

so you could see what's actually

happening at all small medium and large

businesses and here's why this is

important a few weeks ago course members

and I reviewed what was likely going on

at casinos in Macau and sure enough when

we started noticing that VIP customers

were attending Macau Casino

substantially less Casino stocks

subsequently fell now this is the kind

of information these are the kind of

heads up that we want to know there's

some folks some people in the courses

who started shorting some Casino stocks

and they made some good money off doing

that now best wishes for them and this

video isn't to give you Financial advice

it's to talk about some of the red flags

that we're seeing at businesses because

not only do they affect businesses but

they affect the broader economy now

maybe they'll affect the broader economy

in a good way because if businesses slow

down as long as they don't go bankrupt

then maybe be the FED can stop beating

us over the face with ultra high

interest rates but let's go into some of

the actual data first let's start with a

company called bill.com now they serve a

lot of small to medium businesses what's

interesting about bill.com and we'll

just to give you a quick preview we'll

also be talking about things like

Shopify Intuit Nike and and plenty of

other companies okay but just briefly on

bill.com they are a SAS business that

basically help individuals and

businesses pay their bills you know

input your little Bill you hit pay and

they mail the check for you they make it

really easy and then they can sync up

with your books and stuff like that

great fine but their company has been

projecting a 30 growth estimate now

they're down about 45 year to date and

they're projecting that they're going to

grow by 30 percent starting July 1 but

that could be a little optimistic

because we're starting to see an

inflection point in people's desire to

actually download the app for bill.com

now this ends up becoming a red flag

that we're going to see consistent only

at other businesses as well so let's go

ahead and start here this is the

build.com monthly downloads for their

app and you can see we're in about month

10 right now remember it's October

that's month 10. and look at this

plummet right here that we're getting in

downloads that's a substantial plummet

when we're expecting to see potentially

30 percent growth like look at the

growth we had in 2021 right here this

white line we're not actually seeing

that anymore according to estimates per

Bloomberg we might actually be seeing a

decline and that's not that great when

we start seeing a decline like that at

bill.com we wonder okay well how are

other small businesses doing oh uh

here's the so this is the bill.com

business payments app here's the invoice

to go app also showing a substantial

decline but it's not just companies like

bill.com it's even payroll providers

here's an example of ADP Mobile

Solutions now how many people actually

have to download the app for this one is

kind of questionable because they're a

payroll service most people are going to

do this through a computer right but I

mean we had to let somebody go yesterday

now we're looking to hire somebody else

but the more people you let go the the

more or the less you need Payroll

Services right so if businesses are

starting to let people go then maybe

they have less of a need to use the ADP

payroll businesses or Services

especially if they're going from you

know maybe a single founder and one

employee to no employees you see that a

lot during recessions right businesses

become a lot leaner they cut every bit

of fat that they can so uh now for my

personal business we're actually hiring

a replacement just the person wasn't the

right fit but that's okay that's what

you need to do if somebody doesn't fit

or they're not productive then you have

to replace them with somebody who's

actually willing to award anyway so

here's a company that typically grows at

about six percent however the app

downloads are now down 33 year over year

and 26 quarter over quarter again you're

seeing that inflection point that's

really started in September which is

quite interesting so you're really

seeing this decline here's another one

credit karma now I thought this was

interesting because we can kind of get a

little bit of data into Intuit so Credit

Karma I actually think is a pretty

decent app for checking what your credit

score is and seeing if you can improve

your credit score honestly I only use it

for checking what my credit score is uh

although I even rarely do that but look

at this decline uh in in usage that

you're getting at Credit Karma now you

do tend to have every single year the

different lines here are different years

for some reason it seems like people are

more motivated to check their credit at

the beginning of the year compared to

the rest of the year but you're actually

seeing these declines that take you back

almost lower

than 2020 Trends so it makes you wonder

are consumers like all right I'm just

done trying to build my credit like

maybe I've already maxed out my credit

cards I don't know it's kind of

interesting we're definitely seeing some

inflection points and it's not just some

of these businesses and some of the

earnings calls we're going to look at as

well in just a moment here's QuickBooks

QuickBooks Accounting Service also lower

than any prior year uh in terms of

monthly downloads here's MailChimp this

I thought was like a crazy one because

one of the first things that small and

mid-sized businesses do in my opinion is

they cut discretionary spend for

advertising during a recession so for

example if you're paying MailChimp two

or three thousand dollars a month which

I know that sounds like a lot but for a

business that's actually pretty common

with you know mailing lists of say 30 50

100 000 emails that's not a common

and uh and we use mailing lists as well

not only for accredited investors who

are looking to join house hack and

helping provide them updates but but

also other individuals for other

businesses and this is a substantial

decline in the number of downloads here

for MailChimp I mean really huge

estimated Decline and these are just

estimates right so we're trying to look

at forward-looking data well I mean I

guess we're looking at a data snapshot

of what's happened over the last 30 days

but the numbers haven't officially come

out yet so to some extent they're kind

of forward-looking here's customer

hotspot CRM I mean this one's a little

harder to read because like they're

doing so much better in 2022 as a

customer resource manager as in other

years and there does seem to be a sort

of a decline towards the end of the year

so I'm not so terribly worried about

this one here

but you do see that in general small and

medium businesses are seeing their

stocks substantially decline more so

than even like the the larger cap

companies in the NASDAQ 100. now let's

look at some actual earnings calls here

so let's look at Shopify for a moment

some of the things that I noticed in

Shopify is that they're talking about

here a rapid rapidly escalating prices

for essential goods and energies uh and

energy and consumers have been favoring

discount retailers and reducing their

spend on other Goods categories so we're

seeing less discretionary spend and more

necessitated spend and Shopify is

talking about this as a risk factor

right at the same time the New York

Times is reporting that Shopify as of

October 4th is hiring is conducting

hiring freeze for all positions for

store positions physical online retail

and Logistics FedEx froze hiring so what

does this tell you about the consumer uh

you're you're seeing a real slow down

here and Shopify now talking about this

idea of uh getting more rigorous reviews

of our Workforce done through the

organization with the aim of more fully

maximizing our team's performance so

what you're saying is like the company

got fat and lazy right so when you

actually look at some of these numbers

this is a little messy so I'm just going

to kind of give you the bottom lines

here but their revenue grew 15 in the

last three months it grew 18 in the last

six months so you actually have a

decline in the rate of Revenue growth at

Shopify but not only do you have a

decline in the rate of Revenue growth

but you have like the worst combination

to go with that your operating expenses

were growing at 71 which that already is

insane like your operating expenses grew

71 your Revenue only grew 18 that's

terrible that's in the six month ending

period but you go to three months to the

more recent period your op-ed your Opex

actually went up 75 while your Revenue

only went up 15 like it's getting worse

that's not good right here's Shopify as

well

uh originally they thought the level of

orders that they were going to have were

going to be higher than in 2019 but the

rate is actually lower than what they

had planned for so in other words you're

seeing this sort of as they say a

recalibration not necessarily two online

like they thought everybody was just

going to go online all the time people

are shopping in stores again and

e-commerce is trending back to a normal

growth curve is what they say here a

normalized growth curve not a curve

that's actually higher than where it

used to be now maybe that's because of

the recessionary dynamic there are some

arguments that more people are going to

stores because they think they can get

better deals at stores because when

you're in a store the theory is that

you're a more captive customer than when

you're online and like if a store is

going to close you that's the time to

close you right and when I say close

it's like hey like if if you're getting

ready to buy a home like what can I do

to get you to sign that contract you

know maybe like I lean over and I just

happen to drop the pencil or pen next to

you and then when you pick it up it's

like

just sign you know uh like closing right

sales uh anyway so but uh some people

think that that's easier to be done in

in person than uh than inside uh or

online right

uh so so as a result sometimes people

think you get a better deal in person

and maybe that's why we're seeing some

of that move now uh there's some let's

see here this one is uh talking about

some headwinds here oh yeah so this is

Cracker Barrel now I know this sounds

crazy because they appeal to a lower

income demographic I by the way didn't

know they served beer and wine I thought

that was kind of interesting but they

were talking about softer consumer

demand higher costs and this was a bad

one uncertainty about when these will

Abate so it's kind of like businesses

are uncertain about when the inflation

is going to go away at the same time

you're getting less demand I had a

course member this morning in the course

member livestream they're talking to me

about their small business and they're

like Kevin

we have seen no reduction in inflation

like people keep talking about this idea

that commodity prices are coming down

that's it Peak inflation is behind us

but like our costs are still Rising so

like please give us some of the

deflation but we're not seeing it yet uh

and so I you know I always love

dialoguing obviously with all y'all in

the course member live streams and

remember to join those before Friday at

11 59 PM we are getting rid of the

lifetime access uh for people who join

after a Friday specifically with the

path to wealth course but if you join

any of the courses uh before 11 59 PM

you'll have lifetime access to all the

content in the courses with the new

content or whatever and the live streams

but anyway going back to this over here

you know when you have Cracker Barrel

Cracker Barrel okay like there's they're

known for being cheap they're known for

being like your rest stop food that

might be offensive to rest stops

uh anyway they're talking about value

perception

like what here you go Carnival Cruise

Lines okay Carnival Cruise Lines I wrote

this down in 2019 they had three billion

dollars of net income now now okay here

in 2022 they're literally spending 1.7

billion dollars on interest

they had 200 million dollars of interest

expense back then that means they're

spending eight and a half times what

they used to on interest they're

literally spending somewhere around 4.7

million dollars a day in interest

because they're getting reamed by high

loan costs even Nike's freaking out

talking about doing more accelerated

liquidation and uh tightening our

inventory Buys in other words we don't

need to buy anymore because we got

enough

now at the same time as inventory piled

up demand plummeted and now they're

accelerating clearance activity like

then you got AMD and obviously the PC

market got destroyed but look at this

when when AMD tells you that there is a

significant inventory correction across

the PC market and uh shipments for

processors uh you know down due to a

weaker than expected PC market and

significant inventory correction that's

bad so that's ah it's just like

let's try to understand this all of the

things that I'm putting together here

are actually like in a really like

perverse way somewhat good news because

in a perverse way uh businesses

suffering and panicking actually is like

music to the ears of the Federal Reserve

you know they're probably looking at

this video because I know they watch

every single one of my videos because I

who wouldn't you should subscribe by the

way I'm just kidding uh anyway uh

so you know I'm sure they're looking at

these earnings reports one way or

another and they're like good like this

is the point this is what we're trying

to accomplish we are trying to make

businesses feel lean so they stop hiring

as many people and they stop hiring as

many people then wages go down wage

growth goes down right

this is a sign of pain that we're seeing

and so it's actually good news for macro

purposes of you know the fed's policies

are finally working it's just bad news

in the meantime for some of these

companies earnings now you know I know

over the past few weeks it hasn't done

well uh but that's probably because of

the Twitter overhang but it's this is

one of the reasons

I'm actually a big fan of seeing Tesla

as maybe to some extent like an American

Express uh or even a Lululemon because

they they don't have some of these red

flags yet but uh to some extent Tesla is

so fascinating because we know that no

matter how many vehicles they they

produce we expect them to sell them I

guess I can't say we know but Goldman

Sachs for example conducted a report

themselves and they're like hey we think

Tesla's going to get to 1.9 million

Vehicles by the end of the year of 2023

and they're going to sell all of them

uh and I believe that now you know

that's a slightly slower growth rate

that's no that's off the 50 growth rate

that sounds like 30 35 growth rate uh so

you know that that could compress the

stock a little bit but the point is

there are a lot of companies that are on

the earlier phases of their growth curve

where they're not going to see that EPS

decline unless you have like temporary

like foreign exchange impairments like

with Tesla I think you could see a

billion dollar foreign exchange

impairment uh but uh but otherwise their

EPS should grow substantially while a

lot of these other companies like Nike

they're going to be in an earnings

recession you're going to look at their

earnings per share thinking they were a

value company and then they turn into a

value trap because it's like oh no EPS

is declining or you look at Shopify

which you know it's a company that that

sells for at least a somewhat Rich

multiple and uh and all of a sudden you

look and you go oh wait a minute you

guys are actually losing a substantial

amount of money and you're spending a

lot more but your growth just isn't what

it used to be

at the same time and I tweeted this I

don't know if anybody actually cares

about this but I'll say it anyway I

tweeted that uh you know Shopify uh it

seems like they're cutting back on their

customer service and I wonder if that's

because they they feel a little bloated

but yeah look at their loss here this is

a loss in uh hundreds of US dollars

and uh here we had a loss of about a

billion point two dollars that's insane

1.2 billion dollars in the last six

months they lost about 2.6 billion

dollars and why is that happening well

it's happening because they're gross

profit in the last three months with 655

million but uh their Opex was 845

million so you get this massive uh you

know like operating expense here to

where you're actually negative from

operations

and uh then on top of that you take off

uh you know you're taking off a million

dollars for an other expense this is

like right down in in uh ownership of of

uh I think it's a firm stock they got a

lot of a firm stock so they took a

massive write down over here but even if

you forget

this uh this sort of other massive loss

that they're taking over here they're

still losing money on an income from

operations point of view this year which

last year they were making money on an

income from operations point of view uh

so so you've you know now you have

infinite multiples and you're kind of

hitting this turn for the worse again

good for macro but bad for some of these

individual businesses keep in mind if

you want to you know take advantage of

this sort of analysis that I do on a

daily basis like today we did Generac in

detail and we kind of chat about it

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watching we'll see you soon thanks bye