this is bad

folks the saying be careful what you

wish for has a reason because even

though we wished for a 75 basis point

hike take a look at what the last year

of the S P 500 looks like visualized and

boy oh boy I'll tell you that looks like

a pretty damn bloody and thumbnail

because it's just so

ugly oh but it's not just looking ugly

it's look at some of these underlyings

here this particular chart right here

shows Market breadth and I don't mean

meat breath I mean Market breath and

what this is is a measure of the number

of companies trading above their 50-day

moving average and if you guessed that

there's probably no company trading

above their 50-day moving average you're

pretty much right because take a look at

this blue line right here this is where

we get the percent of members trading

above their 50-day moving average now

I'm going to take this beautiful little

green circle here what we're going to do

is point out the end of 2018 right here

we hit the zero line basically uh you

can see that well actually it's a teeny

tiny little bit above the zero line like

there's zero and there's the yellow line

right uh and then over here you get the

pandemic and then of course you have

right now hiding back here and what's

fascinating is every time we hit that

yellow line look at what the S P 500 did

we hit bottom bottom and the question

mark because the question mark is

obviously where we are now now I don't

want to be the person to say that oh but

hey look there's a QQQ is green to start

the day off we're up 1.1 percent oh my

gosh maybe if we go up two percent we'll

get back remotely close no we won't to

280 yeah exactly we won't because take a

look at this you go to the day chart and

it's just a disaster I mean the

fibonaccis got absolutely reamed here

are fibonaccis from the top to zero

percent we quadruple bounced the

Fibonacci zero then we're like yeah no

thanks let's go to another low and now

we bypass even that low it is absolutely

ridiculous what's happening in the

market and it's no surprise that when we

just straight up measure declining

stocks versus gaining stocks we get a

chart that looks a lot like this this is

called The Tick chart and the crazy

thing about this is this chart goes all

the way back to the late uh well

basically late 80s uh and early 90s and

as you can see here this is your zero

line right here so red days are

generally below that depending on the

market cap of these companies but anyway

more losers would be below the line

right and take a look at the harshest

days ever look at that there you go we

have now just hit one of the harshest

days ever and there have only been two

of such in the last 30 years yeah it's a

pretty painful Market by some accounts

the market is collapsing three times as

fast as it did in the.com bubble which

of course when I tweeted that out follow

me there at realmeetke Kevin on Twitter

many of you are like hmm that means

maybe it'll recover three times as fast

which I can't blame you for thinking

that because after all we've got some

good news I'm back from my vacation

we've still got a week left before the

prices on the courses on building your

wealth and stocks and real estate go up

again use that 50 off coupon code before

the prices move again link down below

now uh the thing that we got to know is

a Powell's yapping in the Senate today

we've got Bullard yapin today and 75

basis points are going to hit earnings

but they're doing this to try to prove

credibility now these generally lead to

words that we don't want to hear the

last fed chairperson to feel that they

had to prove credibility was Paul

volcker who raised interest rates nearly

to 20 percent to outpace where inflation

had entrenched itself for a period of

six years fortunately we're just facing

about one year of inflation now but Paul

volcker said this morning sorry you can

see where my head is Mr Bullard said

this morning that volcker had to earn

his credibility and then he sort of

implied that today we're somewhat

credible maybe we have some credibility

left now Powell is in the Senate today

reiterating his commitment to two

percent inflation and we know that

Vladimir Putin had a speech this morning

which is probably their afternoon where

he said that the war in Ukraine will

only end once Putin accomplishes his

mission which is protecting the donbos

region defending it and completing all

of the objectives of his special

military operation now Putin when asked

about the West suggesting that he is

causing inflation essentially laughed

and kind of said a yeah right a y'all

just straight up print money after your

pandemic and then you go out and shop

now you're blaming me for inflation

you can't kind of blame him for uh for

the slap back there but anyway

E500 now implies an 85 chance of

recession that is a recession being a

price stand could potentially be a good

thing but doesn't necessarily align

quite yet with history because if we

look at this historical chart here what

do we know we know that if we go back to

1929 and we overlay median recessions we

know that if we end up having a

recession we still have two bottoms

ahead of us which is not great because

we're at a pretty painful place right

now honestly it feels a whole lot like

we're on the Titanic and some of us are

still hodling on while the Titanic

Titanic is flipping up which is by the

way a video that I'll link down below

which I made back in January and I got a

lot of hate for suggesting that maybe

things would collapse which one of the

things that I can't help myself before

bringing up is in that video I suggested

the collapse of stable coins and guess

what so far we had the massive Terra

Luna collapse and now people looking at

other stable coins going oh man what's

next anyway

Now by some regards people especially

retail have still not yet capitulated in

fact if you take a look at this chart

right here what do we see we see the

triple QQQ or the triple NASDAQ now even

though the triple NASDAQ has been going

down this line is going up it's going up

because there are more shares

outstanding which means more people keep

throwing money into the triple NASDAQ

despite the fact that it's been losing

money like crazy this right here is a

sign that retail generally retail

continues to be bullish on America that

retail is not capitulating and that

there's still a massive appetite for

speculative Investments not to mention

the fact that if you hop in over here

what do you have here you have the fund

flows for RK and they have been positive

all freaking year long above the green

line pause below the green line negative

Kathy Wood is somehow still

substantially attracting money which is

suggesting that full retail capitulation

is not even close yet people even say

the bond market has not had its full

capitulation yet though I will tell you

the bond markets moves yesterday were

kind of scary yesterday the 10-year

treasury yield which dramatically

affects mortgage rates and is one of the

things that I'm really paying attention

to because I think it's going to be a

huge leading indicator for how bad that

real estate kind of Correction or crash

could end up being how many

opportunities I'm going to be able to

buy in real estate really looking

forward to being able to buy in real

estate especially since I sold about 22

properties at the beginning of the year

closing a couple of the remaining ones

now but the 10-year treasury yesterday

which is almost directly correlated with

a 30-year mortgage shot all the way up

to 3.45 which would have easily pushed

mortgage rates up to about 6.3 to 6.5

percent now that 10-year treasury in

after hours plummeted it back down to

where it is now 3.24 so why did we have

a 20 basis point move there well

potentially because some investors are

now saying that Tina is dead remember

Tina is there is no alternative to

stocks and if Tina is dead that means no

no wrong if I could get 3.2 percent on a

10-year treasury yield I'll take that

3.2 percent annually for 10 years over

bothering with what could be a gloomy or

dare I say Frugal decade in stocks in

fact that's why markets are so

frustrated right now and because we

continually expect that earnings

forecasts are going to get revision

revised down and that we're potentially

going to see an earnings recession that

lasts years and that means years of bad

earnings or declining earnings that we

ended up having a stimulus precipice and

then it's down from there it'll take a

while to actually hit bottom and come

back out

Philly fed not too happy either current

conditions contracted and expectations

for the next six months are consistent

with

previous recessions Ray dalio's shorting

European stocks with a 5.7 Billion

Dollar Bet and folks maybe some good

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have other good news as well and that is

the likes of JP Morgan JP Morgan

released their May delinquency rates for

credit cards and found that they're down

to 0.67 percent from point seven percent

in April and down from 0.69 in May of

2021 that means year over year we've

improved and month over month we've

actually improved in delinquency rates

now JPMorgan did see an increase in the

rate of charge offs sitting at about

1.725 percent which is a slight Tech

higher it's actually about 50 basis

points higher than where we were in

April uh but it's about roughly in line

of with where we were last year and it's

a good amount about another 50 basis

points lower than where we were in

February of 2022 right before the

pandemic so in other words the

inflection here to notice is we really

haven't actually seen an increase in

delinquency rates yet we're pretty damn

consistent and even though we're seeing

substantial distress in the bond market

and we've seen Bond distress ratios go

from 2.4 percent to nearly double to 4.3

percent which potentially success

suggests we could see more defaults like

what happened with revlon's bankruptcy

filing which finally came out but if we

look at the last five years the average

distress ratio in the bond market was

actually eight percent we're only at 4.3

percent now and that's well below the

thirty percent distress ratio we usually

see going into recessions and many

credit firms you know like the Standard

and Poors and Finch and and the credit

rating agencies these agencies are still

upgrading companies something that they

generally don't do right before a

recession

on top of that we're potentially

starting to see demand destruction which

Kathy Wood has always alluded to in the

amount of gas and oil that we use take a

look at gas product supplied and uh and

then in other words used in other words

how much gasoline is the United States

actually demanding and using we're

sitting nearly six percent below the gas

usage we used to have we were here we

are now here now again it makes sense

prices are more expensive but it's an

indicator that we are starting to see

demand destruction why if we go back to

years like 2018 and 19 we're actually

using less gas well again yes price but

when price goes up demand should go down

that's the point that's demand

destruction it just is a good sign

though in some sense that we are

actually seeing a turn down in gas

demand because it does end up putting

less pressure on gas prices to continue

going up if we were still using the same

amount of gas gas prices could be even

higher seems crazy but anyway take a

look at some other things that are at

least some signs of Hope here's a chart

of Air Freight pricing and you can see

Air Freight pricing really peaked around

the end of the year and we've really

come down since then which is great this

is a chart of fertilizer pricing which

we saw some real drama after the Delta

variant and obviously some serious drama

when the war in Ukraine began but take a

look at where we sit now we really sit

at roughly the beginning of both of

these crises which is not bad that kind

of looks like a sad face

take a look at a lumber here we'll

switch to a little red line to draw on

lumber prices previous to the pandemic

have generally sat somewhere around four

hundred dollars and take a look at the

chart that we have now right now the

chart sits roughly above the 500 level

but it is substantially below the peak

that we had also during the Delta era

and during this latest commodity boom

following the war in Ukraine take a look

at this this here is the menu used

vehicle index where we have has seen a

nice downtrend here in used vehicle

prices though unfortunately and we saw

this in the last CPI report we did get a

little bit of an uptick here as well

we've been doing pretty well in at least

getting it to push down although we have

played this song before so hopefully we

can just get this to consistently Trend

down rather than just give us these

little fake outs here so we do have at

least some signs of good news but there

are some big things that we should be

thinking about going forward and yes I

mean big things in addition to you

finally joining the amazing programs on

building your wealth we're gonna have an

amazing live stream today and we've got

such an amazing tool coming out for

course members in the next two weeks for

a ton of new lectures it's going to be

really really awesome with a new style

of a studio so we're super excited about

that but what do we want to think about

going forward well number one in my

opinion and I want to just rehash old

things I mean you know the obvious ones

but number one I would personally at

this point limit my exposure to stable

coins I personally don't believe that a

seven to ten percent yield is worth the

risk of a Terra Luna style collapse in a

recession or in extended depression or

era of crypto liquidity and liquidations

volatility I would not want to be

exposed to an asset like stable coins

now if I'm locked in in all right well I

guess I'm locked in but if I could

withdraw it'd probably be something I

would highly consider because I think my

cash actually has more value than that

potential seven to ten percent that I'm

gonna get it over the next year just by

sitting waiting for a new opportunity

remember if asset values go down your

cash actually experiences deflation not

inflation you really only experience

inflation on the cash that cash that you

use to buy food and Energy Products like

gas now number two I'm just recommending

be careful with very high volatility

Place buying puts and buying calls are

very very difficult in this kind of

Market because volatility is so high and

you can get squeezed to crap no matter

if you're right on direction or not now

this does make for an interesting

opportunity to sell calls or sell puts

obviously number three the obligatory

get out of debt as fast as you can and

eliminate the potential for a rug pull

takes a lot of stress away also I do

want to caution number four green days

in my opinion are unlikely to last in

this kind of market so you really have

to ask yourself how much cash do you

want well that's up to you do you want

to be 50 cash 50 in the market do you

want to be more like me where I'm

roughly 90 in the market maybe 10 cash

maybe maybe that's somewhere between 80

20 somewhere around there depending on

how the real estate opportunities close

but for me I see some beautiful

opportunities and I like taking

advantage of those and every time I make

a different move which we're going to be

doing a whole lot of moves over the next

six months once our Market sort of

evolves and even on these dip days you

can see every single one of my buy or

sell alerts based on what I'm doing with

my portfolio which is not necessarily a

suggestion for you or it's not at all

it's just what my portfolio is doing and

then you can interpret whatever you want

to do yourself you can get that in my

stocks and psychology of money program

linked down below but folks you've

really got to ask yourself right now how

patient can you be do you feel

comfortable getting into for example

Commodities or even company companies

like Occidental Petroleum which what's

interesting here is over the last month

they're down 16.33 percent if anything

some folks are growing quite tempted to

potentially even short oil companies

because we don't expect oil to stay this

expensive for this long or much longer

but what if it does who knows all I know

is everyone's getting hurt out there and

if you're not patient and have some real

potential issues some folks are even

suggesting real estate uh or shorting

real estate in the stock market but you

have to be careful because the stock

market has already moved a lot of these

real estate companies down 20 to 30

percent what if the stock market

rebounds lifting these companies before

a real estate market even slows down

it's tough to know with certainty but

there's one thing that I know and it's

patience is everything so I hope to see

you in the programs on building your

wealth link down below you get lifetime

access to them you get access to me in

our course member live streams and folks

we'll see you soon thanks so much bye