VERY BAD: What Powell **JUST SAID** & FORECAST | Fed Disaster

The Federal Reserve gave us one hell of

a meeting today and there is so much to

parse out of this. Are we going into a

recession or not? How bad is what's

actually happening? And what's Powell

doing about it? Is he going to be too

late? I'm going to tell you everything

in this video. Spoiler alert, he's going

to be too late and it's creating a

little bit of a problem in markets.

Let's talk about this quick note. I want

to show you from the alpha report this

morning. Mind you, I also sent out a buy

alert during the dip of the Fed meeting.

Everybody who's a course member of the

Meet Kevin Alpha Report got an alert

through our app. It's really great. But

look at what we wrote this morning. This

is a sneak peek into how I do with my

alpha reports. So, it's not like some

fancy document. It's I'm typing it with

y'all, right? But it's it's it's real.

It's my opinion. And so, this morning,

this is exactly what we said. This is

what we predicted. Powell 65% chance he

comes in on neutral. I said, "We don't

really think a 25 move does anything to

bonds. Expect flat and slightly up on

yields as Powell talks about the balance

of risks, data dependent, and being

meeting by meeting." Mind you, he did

all of that. Uh, we will also unpric

this six cuts by March idea, especially

on the back of retail sales, Atlanta Fed

GDP. In my take, we're going to see

yields up after Powell today, maybe to

4.15 on the 10-year. That could give hit

real estate stocks a little bit and give

us a bit of a dip by today. Something

that we wrote this morning and boy,

here's what we got from the Federal

Reserve. So, I'm going to give you what

happened. All right, so if you want

that, you just go to meet me Kevin.com

membership. So, here's what happened. We

got a 25 basis point cut. We only had

one descent. We were expecting Bowman

and Waller to join in descents. Nope.

Everybody ostracized but I have

to give credit. He didn't go dirty

on the summary of economic projections.

He could have gone dirty on the summary

of economic projections and really tried

to sandbag the SEP, but he didn't. He

didn't screw up the ranges of the SEP.

He stayed broadly in line with

everybody. And this Fed is unified that

unemployment is going to stay in the

mid4s. Now they gave us a forecast that

we are going to get three rate cuts this

year with 25 basis points of cuts next

year and 25 points thereafter. This

means yields are going up a little bit

because markets have to unpric this idea

that oh maybe we'll get a 50 or maybe

we'll get six cuts by March. Some banks

are calling for six cuts by March.

Crazy. But anyway, I want you to see

this. We only added 2.25%

uh or we only had 2.2 25 cuts priced in.

So initially when we saw three cuts

getting priced bringing that rate down

to 36 at the end of the year that brings

us down from four then to 375 then to 35

which is a range of 35 to 375. That's

why it says 36. It's technically like

365 but anyway that's why we initially

had this oh my gosh this is a dovish

summary of economic projections. We

thought okay we've got a little bit of a

revision up in growth. We were expecting

a revision up in growth. They went to

16. I was thinking 17. I thought they

would have shown more of a revision up

in the unemployment rate. They don't

actually think the unemployment rate is

going to move up that much. The Fed is

very unified here. You don't have many

crazy outliers. And even though you've

got in here, the dots show a lot

of unity with I mean that's probably

over here, but again, everybody's

just going to look at him as the

Trumpian chill and it doesn't really

matter. What matters more than all of

this, mind you, is what Powell said.

Because initially this sounded dovish,

right? We get this summary of economic

projections and markets are like, "Oh,

this is great. We're going to get more

rate cuts." But wait a minute. Then

Powell gave us a dose of reality. Then

Powell told us, "Wait, guys. We've got

serious problems and the labor market is

getting worse than we thought." Now, I'm

going to explain all of that, but I want

you to know that his reaction to the

labor market is getting worse was,

"But we're going to stick with 25 basis

point cuts and we're just not really

going to do anything about it." That

does create a little bit of nervousness,

but it puts you in that neutral

direction. That's why I said neutral

power, which to me is bullish for our

indices and we're probably going to get

to 600 on the cues by the end of the

month. That's also one of our alpha

report price targets for the end of the

month. I shouldn't give away all the

alpha, but that's our take. It aligns

with the neutral point of view in the

report that we issued this morning. Now,

what we have to know are the details of

what Powell gave us. This is in my

opinion the crazy part. To understand

these details, you have to know there

are two things that you could pay

attention to to know if what Powell is

saying about labor actually gets a lot

worse. And you could get this in the

Meet Kevin app, by the way, if you

wanted. All this is listed out in the

Meet Kevin app. You could change the

colors. You don't have to use this green

color. But anyway, I'm going to read it

off right here. So, what changes the

labor market if labor force

participation normalizes? Because it's

been shrinking lately. It's been

falling. It's been a little pee

shrinkage. Nobody wants that shrinkage.

If labor for force participation rises

again, the unemployment rate will

skyrocket to 5% very rapidly and every

single member of the Federal Reserve

will be wrong and they will have to cut

substantially faster and Jerome Powell

will earn his name too late. Okay,

scenario number one, labor force

participation increases. None of the Fed

members are talking about it. None of

them. That's a red flag. Okay.

Then if layoffs increase, this is the

second obviously the unemployment rate

via the beaver cur the beverage curve

will skyrocket to 5% and beyond very

rapidly again indicating that the

Federal Reserve will be too late. So we

got 25. Is that enough to help the

market? No. Even well not not the stock

market. Is that enough to help the jobs

market? No. It's not going to make any

lick of a difference to the jobs market.

Now, why does that matter? It matters

because of what Jerome Powell just said

about the jobs market. I'm going to

break that down. Now, you know what the

risks are. Now, you know why, you know,

the the yields market is moving the way

it is. You also know why we bought the

dip. We also know we bought the Fed dip,

right? We also know why the stocks, you

know, stocks are moving up right now.

But there's an underlying serious issue

here. And Jerome Powell gave us multiple

warnings. We're going to talk about

that. I do want to quickly shout

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great. Okay, now we need to talk about

those Powell risks. Okay, this is a big

deal. So, the Powell race

Powell said things that I did not like

at all. Okay, so here are the bad ones.

First, Powell told us that the QCEW

revisions, oh, we expected that. The big

900,000 in job revisions, oh, we

expected that. That is a sign that

Powell is being more neutral. His

neutrality isn't good here. It's his

neutrality, in my opinion, will end up

leading him to be too late. He's not

scared enough. Now, why do we think he's

not scared enough? Well, we don't think

he's scared enough because what he ends

up saying, he says that even though

right now the labor market is weakening

and we're removing the word solid from

the labor market is solid and we are

below break even, we are only getting a

25 basis point cut. That's why bond

yields are up because we're only getting

25 which is the bond market telling you

the Fed is going too slow. The bond

market is screaming Fed, you're making a

mistake. That's what the bond market is

telling you. I want you to understand

those those phrases are huge. He says

the downside risk to unemployment have

risen. Disinflation continues in

services which is good on inflation. It

appears we are under the break even rate

with hiring softening. Labor demand is

less dynamic and softer. All bad.

Tariffs are showing up, but the the the

full effects remain to be seen. And we

hope that they're going to be one-time

and shortlived effects. Weird way he

says that. The problem with that is he's

basically telling you, "Hey guys, we're

good on inflation. we're going to mostly

have transitory inflation over time. Of

course, he's not using that word, but

we're going to mostly have transitory

inflation over time. So, he's not

worried about inflation. Then, he's

telling you that we're under the break

even rate of employment at 29,000 jobs

over the last 3 months. And then he's

only giving us 25.

He actually goes as far as saying that

even though Moran voted for a 50 basis

point cut, he says this is a

riskmanagement cut. There was not

widespread support for a 50 basis point

cut. Now what's different, the reason we

went for 25 and why we're going for

three 25s this year is because last

meeting we were at 150,000 jobs per

month. Now we're at 29,000 jobs per

month. This suggests the labor market is

quote really cooling and it's time to

take that into account.

Damn it, Powell. If it's time to take

into account that the labor market is

really cooling and that we're below the

break even rate of the labor market,

then wake your ass up and give us bigger

cuts. This ain't enough and you're going

to end up being too late. That's why

we're seeing those bond deals tick up a

bit, which was part of our neutral

expectation. I expected this morning

when I wrote this in the alpha report. I

expected this morning I I told course

members I'm like look he's just going to

go meeting by meeting data dependent

balance of risks he said all three of

those things why well because why is he

going to make a big forecast now you

know Atlanta Fed GDP is at 3.6% 6%.

You've got retail spending, which is

great. Although he mentioned that you

got to be careful with retail spending

because it's really just the higher

income consumers, right? They're the

ones who keep spending. The rich get

richer. Everybody else who's trying to

work for a living is suffering. You got

people like Elon Musk bragging about how

hard he's working to earn his trillion

dollar pay package. Oh, poor Elon Musk

has to take a redeye at 11:30 at night

from San Francisco or San Jose all the

way to Austin, Texas, and it's a red

eye. He makes it seem like he's sitting

in a Spirit Airlines plane like this.

You know, that's what he's making it

seem like. I have short shorts on, so

suck it. You get short shorts today.

This is what, guys? I had to take a red

eye. I'm working so hard for my trillion

dollars, bro. He's in the back of a

Gulfream jet sipping on champagne and in

a bed. He's got a bedroom in the back of

his jet and he's trying to make you feel

like he's working hard. Well, you should

be doing this if you want a trillion

dollars. I don't know how I got into

that rant, but the point is that there

is real pain in this damn economy. And

Jerome Powell is telling you, "Yeah,

shit's kind of hitting the fan, boys and

girls. We're below break even. Labor is

weakening. You know, it's no longer a

solid labor market. And there's

meaningful downside risk. That's these

are quotes. I wrote these down as

quotes. There is meaningful downside

risk, which is quote now a reality.

Yet, we only get 25. Again, we expected

in the alpha report this morning that we

were only going to get 25. We expected

that yields were going to go. That's

fine. That was my 65% base case. I did

have a neutral scenario which I called

alternate number one but this didn't

happen you know right here I said very

concern like the dovish scenario would

have been you know we're cutting more

we're going to you know maybe we're even

doing some QE we want to get back to a

stimulus pow that's what would be great

for TLT we want this Powell because it

minimizes the risk of a jobs recession

we want this but we did not get that we

we also didn't expect we were going to

get that and we didn't think we were

going to get a hike either again 65%

chance neutral we

So, you've got a Powell who's basically

like, "Yeah, you know, we know the labor

market's going to shit." But, you know,

we uh we expected that. He literally

said those words. Hey, man. Like, these

revisions uh they're so large. These

QCWs, yeah, you know, they were actually

spot on our expectations. We expected

that. I like Powell. Bigger cut then.

Damn it. Uh then he gets asked about

black unemployment, minority

unemployment, which fact check here,

black unemployment has shot up 1 and

a.5% to 7.5%.

You know what Bloomberg calls that? They

call that quote unquote. That's rare

outside of recessions. It is a leading

indicator of a recession. This is why

Powell needs to wake up. But, you know,

he's like, "Oh, you know, but households

are still in good shape. Uh, you know,

we we could always uh basically what

he's implying is, hey, like if things

really hit the fan, we could always cut

faster, but we don't need to do that

right now." So, yes, Powell is doing a

really good job right now of earning his

keep as being Mr. Too late. This is this

is not a surprise. We have the 10-year

Treasury yield up modestly, 3.4 basis

points to 4.06 broadly expected. Okay,

we have markets that are recovering and

I think we can get this slow schllogger

up because we don't really have negative

catalysts until when you should know

this October 1st and October 3rd. So

with all that said, thank you for

watching the Fed summary video. Make

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>> And that's all I got for you.

>> Kevin is much more interested than most

people, by the way, in the balance

sheet. Kevin is very talented, but I

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he's a very talented guy.

>> Kevin's somebody we consider you. Kevin

is fantastic, too.

>> Welcome. Nice to have you. You want to

talk about love making, right?

>> I love that one. I'm sorry. Sarah Isaac

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>> We'll we'll try a little advertising and

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You have done so much. People love you.

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>> Kevin Pra there, financial analyst and

YouTuber. Meet Kevin. Always great to

get your take.