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see you soon I I think the the most

important thing that we want to look at

here is let's just talk about tomorrow

so most important now obviously we've

got green going into the market here on

the eve of inflation we've got Bitcoin

over 30 000. in my opinion the absolute

most important thing coming up is the

inflation report tomorrow so let's just

talk about my expectations around this

inflation report specifically what I'm

looking for and I'll put together all of

all of sort of the research that we've

been doing to to put my thinking hat on

and make a prediction hear about

inflation so I want to be very crystal

clear here I think that inflation will

end up proving to be longer term

transitory there's one thing everybody

learned around this cycle and it's

patience everything took a lot longer

than people thought the fed's hiking

cycle came later than folks thought it

took longer than folks thought things

started breaking but quite frankly the

banking crisis things started breaking

really in my opinion aren't red flag

that the FED has over tightened or has

created a recessionary environment I

think that the fringes suffer when

there's a tightening cycle the companies

that are zombie companies with poor risk

management procedures the companies that

have poor cash flow the companies with

exposure to risky assets like uh Silicon

Valley Bank startup sector uh Signature

Bank the crypto sector and uh and and

Credit Suisse has been

plagued with scandals and poor auditing

and risk management procedures for

decades all of these companies

collapsing really serves as no surprise

and in my opinion not a sign of a

greater financial crisis but rather of a

normal weeding out cycle that you would

get in a crisis uh that is normal

companies that should not exist should

die at some point and that is what

Cycles do the bear markets take out the

bad the junk and it's like a hurricane

that comes through and weeds all the

trees you know after a hurricane

everything looks super clean around uh

with the exception of all the debris on

the floor but you look around it's like

wow Everything feels like it's just got

a big bath everything just got blown

around I grew up in South Florida so

it's relatable to me but anyway point

being this this recessionary environment

could very much be like an economic

hurricane where just the week got

cleared out and the excess labor got

cleared out and they were encouraged to

go be productive somewhere else and we

could end up coming out of this

recessionary style environment with a

substantially larger or or more

productive economy with higher GDP

growth which lowers the burden of our

national debt anyway and we could come

out of this much more productive than

when we went into this in other words

all of this insane expansion of the

money supply from the stimulus era could

actually end up

helping create this bubble environment

where everybody got showered with money

to go innovate and build and build and

build then you run through and you

basically destroy everything that

couldn't figure out how to make it with

unlimited amounts of money so try making

it with restricted money and now

hopefully going forward you have the

most efficient businesses left over that

got stimulated massively and are still

getting stimulated whether it's chips

artificial intelligence electric

vehicles

energy you name it so regarding CPI

tomorrow and these by the way all my

favorite pricing power stocks my

favorite stocks you can see them my

actively managed ETF the courses on

building your wealth everything just go

to meet kevin.com we've got a coupon

code expiring tomorrow the price will be

going up after April 12th so CPI per

Bloomberg we know is expected to come in

at 0.2 percent uh on the month over

month level and the year over level uh

year over year level is expected to come

in at 5.1 percent which is fantastic uh

these are these are big moves to the

downside from six percent to 5.1 percent

uh from the prior read year over year

that's great we don't get as much of a

movement in core or when we exclude food

and energy so a lot of this being driven

by a fall in food and energy prices but

if we look at the non-core what we're

really looking for is just starting

signs of disinflation in Services that's

exactly what Jerome pound told us to pay

attention to he said listen

Goods deflation is here that needs to

hold so we need to keep seeing weakness

in used autos new Autos durables any

kind of goods outside of foods and

energy let's continue to see weakening

there

then at some point we're going to get

the rollover of housing data that is we

will start getting weaker housing data

for rents and that will help lower

owners equivalent rents that's part two

but part three that has doesn't have the

forecast yet that isn't expected just

yet to rule over like housing or Goods

part three is that core Services

disinflation your attorneys your

financial advisors your haircut your

medical supply uh or your medical

services rather all of these sectors are

where we're looking for weakness and

drum pal expects to see the process of

in his words disinflation to begin there

soon my hope is we start seeing the

beginning of disinflation there now I do

do I think that inflation is going to

just remarkably plummet and come in

substantially low and it'll all be over

tomorrow in other words all the

inflation will be gone tomorrow and the

FED can finally start cutting interest

rates more much like the bond market

anticipates no I do think much like we

saw last year that the bond market is a

little bit ambitious in their Fed rate

cut cycle remember last year what

happened we were expecting at the end of

last year that the Federal Reserve was

going to cut uh somewhere between a 1.5

to 2 percentage points by the end of

2023. those expectations vanished very

quickly the reason those expectations

vanished work very quickly is because we

had hot January numbers and all of a

sudden we went from pricing and rate

cuts to pricing in no rate cuts but what

interestingly happened is the stock

market actually rallied substantially in

the first three months of the year so is

it possible that that same thing could

happen again my thesis is yes we could

start seeing disinflation on the

services side we're clearly on the path

towards disinflation however we're not

in as bad of a recessionary environment

thanks to the banking crisis as people

expect as a result what happens we have

to start pricing in

higher interest rates for longer but the

last time we did that between December

and about February stocks actually

rallied now it's possible that they

rallied because of tax loss harvesting

and rebuying uh in January but take a

look at this particular chart this shows

us the current implied overnight rates

of uh and rate cuts and what we're

seeing is this plummeting in other words

we'll get to a terminal of about 5.25

with about a 65 percent chance by June

14th and then we'll expect to see this

plummeting in rates uh where we could

potentially be cutting rates as much as

2.75 percent as soon as uh January 2024

and the December cycle in or December

meeting in 2023. that's entirely

possible but I think personally it's

unlikely we're going to see cuts that

dramatic unless of course the economy is

absolutely going into a recession

based on the Atlanta GDP now forecast

GDP today could still be around 2.1

percent

and if that holds even above a half a

percent through this summer this scary

Q2 Q3 era that people are really worried

about then it's entirely possible that

we could see inflation continue to Trend

down while stocks continue to Trend up

and we probably stand higher for longer

now that is what many people call a

Goldilocks scenario and I think they use

that because they're trying to say it's

unrealistic it's not going to happen

it's very unlikely but let's think about

this graphically for a moment how this

could look and it will also combine real

estate so let's look at this graphically

for a moment so what do we have we're

over here in uh December of 2022 and we

think that rates are going to be lower

so we price in lower rates right what

happens come about January and February

well we start pricing at higher rates

then we get the banking crisis and what

do we get with the banking crisis over

in March well we start pricing in lower

rates for that December era of uh 2023

so let's go ahead and write December

over here March the banking crisis

happens so we get higher for longer up

here this will be our rates for green

here and now we're pricing in lower

again right this is going to be what is

being priced in rates or let's write in

uh we'll say rates

uh now for 4 11. but let's do a rates

likely trajectory and this is going to

be sort of more of what I believe in

terms of the trajectory so we'll go

ahead and follow the light green over

here we'll we'll get our our five and a

quarter but we potentially stay there at

a pause for longer this is that higher

for longer argument right and the reason

I think this that maybe we don't

actually end up getting any kind of cut

until let's say September and we sit at

this pause level for longer is because

we know the Federal Reserve does not

want to make the same mistake that they

made in none other than the 1970s in the

1970s the FED took this approach of

start stop start stop with rates and

that ended up being a big mistake

because it broke inflation expectations

because inflation expectations have been

so incredibly anchored over this entire

cycle I personally think it's highly

likely that we're going to have a pause

for much longer than markets are

anticipating uh now what does that mean

potentially for the stock market well I

think a pause for longer is actually a

good thing you still get your sort of

the FED suggesting hey we're conquering

inflation we're going to pause so you

get the benefit what does this do it

creates the we'll put benefits it

creates the benefit of we didn't break

everything uh so didn't over tighten

right benefits of pause for longer

that's what I'm calling it the benefits

of a pause for longer we didn't break

everything we didn't over tighten which

Jay pal says hey there's no evidence

that we've over tightened which I would

argue differently that there are some

evidences that we've over tightened but

anyway benefits of pause for longer we

didn't break everything uh we don't

repeat the mistakes of the 70s that

created hyperinflation

but in addition to that benefit we can

support

a Nike Swoosh stock market now why is

that well first of all it is what has

been happening as interest rates were

actually projected to go up what

happened well the stock market actually

also went up and even though we've been

somewhat volatile over here we've been

somewhat stable uh and so the Nike

Swoosh thesis if we kind of uh draw the

Nike Swoosh as sort of a big down and

then a big Trend Channel up with a lot

of volatility in it we could see our

Nike Swoosh this Nike Swoosh expecting

to take potentially 10 years as we start

our next Bull Run now what does that

potentially mean for real estate well

real estate is probably the biggest

outlier right now we really don't know

uh and that's because even though

treasury yields have come down spreads

on mortgages have gone up so mortgages

are still pretty expensive and right now

because there's such a lack of inventory

you're actually seeing prices in many

markets start Rising uh year over year

again and they're escaping that

potential year-over-year negativity that

we would have expected for next month

may had prices even just state level

we're actually starting to see those

move up you know that could

uh turn upside down in other words real

estate could get hit substantially

harder in the event inventory skyrockets

as uh reads start liquidating or

professional institutional investors

start liquidating I think it's unlikely

that any kind of liquidations are going

to come from regular households via

short sales or foreclosures or whatever

uh so instead I think it's likely that

the stock market continues it sort of

Nike Swoosh on Trend up we have this

higher for longer regime in the stock

market right and this is Kevin's Crystal

Ball but I do think that this this takes

a lot longer to rotate down I think the

FED is going to be okay with slightly

higher inflation for longer

slightly higher inflation for longer via

no wage price spiral that we we already

know the conditions of that are not

present we know that very clearly

looking at almost any earnings call from

the last three to six months of

companies who who employ uh or higher

labor uh but also the principle of

flexible average inflation targeting

which would suggest that the FED is okay

with higher inflation rate for longer

because as long as it averages two

percent over the long term they're okay

with that and they can take

opportunistic inflation to get there

rather than Breaking markets so what you

have here is this combination of I think

the Bond Market is a little enthusiastic

assuming that we're going into this deep

dark recession I I think that upper end

consumers still have plenty of money to

spend and probably will for another year

uh but by that time we should be

convinced that inflation is actually

lower which might loosen banking

standards again as uh as rates slowly

start coming down so I think the the

loosening of banking standards comes

when inflation is convincingly down

right and then that's actually where we

cut when the FED cuts

it's a huge indicator this cycle that

they've won on inflation the FED winning

on inflation is everything here folks

this is not the FED cutting because they

care about recession or not they will

gladly Force us into a recession if they

need to

what the FED cares about is concrete

inflation and that's I think why we end

up with a pause for a lot longer before

we start getting Cuts I think the Bond

Market is being a little excited

anticipating as many Cuts now what I do

think if I were to draw in real estate

here this is going to be a little bit

trickier but but let's try to make a

projection here with real estate so I

think that real estate prices

uh State stayed higher for longer I

think we had our adjustment down in real

estate you know about 10 20 in some

areas you're starting to see this right

now where you're trending up in Florida

for example you're actually positive so

you're starting to see a trend up the

only way you could really push that down

is if you get substantial inventory

increases which so far we're not seeing

but people right now seem to be

comfortable with these higher rates and

it's leading to more of a soft

appreciating market now if we then as

interest rates potentially start coming

down the traditional argument is that

okay well rates are starting to come

down as the FED cuts the traditional

argument is oh great well that means

raise prices are going to go up again

right not necessarily what is actually

entirely possible with real estate is

that as rates come down more people

decide to sell

uh people who've been locked in and they

didn't want to take a high seven percent

loan or whatever and you actually keep

this pressure down on real estate

whereas you're increasing inventory and

as rates are coming down you're actually

just staying stable and I actually think

this is going to create a wonderful

window of opportunity to buy I don't

think you necessarily have to try to

time here or if we end up getting any

kind of like little bit of a dip again

over here I don't think you have to be

perfect on that I think as an investor

you want to look at this future over

here and there are two main Investments

that you want to be making right now uh

well maybe not necessarily immediately

right now for real estate but soon you

want to be getting into real estate

obviously I have a course on teaching

you exactly how to go from zero to

millionaire uh through real estate

investing and I think this flat period

of time we might face or even a slight

dip again we don't know it's going to be

one of those I think although it's also

possible that you know real estate just

goes to the moon again as the money

printer is turned on though I think

that's less likely I think first we go

through some form of inventory shock

which either drives prices down more or

it just levels them out right uh and

that that will create a beautiful window

of opportunity which we'll have more

insight on by the third quarter that's

when I expect to start buying for my

real estate startup so I think by the

third quarter we start having some nice

opportunities to really start buying in

sort of this flatter market for longer

at the same time and in the meantime

hopping on to this Nike Swoosh recovery

of the stock market trending up as

inflation proves to go away so this is a

a pretty detailed in my opinion thesis

going forward now what are what are the

risk factors here uh the risk factors

that would encourage you to get life

insurance in as little as five minutes

by going by kevin.com live all right

risk factors remember none of this is

financial advice it's non-personal

Financial advice I am a license

financial advisor but I don't know you

so I can't give you personal financial

advice so when I say I think it makes

sense to go long stocks which I've been

saying for a while now and soon it's

going to make sense to really go long

real estate and then acquire as much

assets as you can over this next decade

that's not personalized Financial advice

I just think it's good Financial advice

uh broad generic Financial advice right

I think everybody should be doing that

so what are the risk factors here well

obviously the risk factor is that if uh

if if we have we have sticky inflation

which we'll see more about tomorrow if

we have sticky inflation on services

then expectations on inflation could on

anchor and we end up getting Paul

volckerd right and then what you have is

the worst case scenario worst

case uh there we go so that's the worst

case scenario is we get Paul Walker

that's deep dark dirty recession right

this would be very bad it's entirely

possible that this could happen I would

put about a five percent risk on this I

think you're you're five percent looking

at Paul volcker and I think you're

probably more like a 20 uh

recession for longer so I would call it

like a shallow shallow low growth

recession for longer ironically a low

growth recession actually leads to a

flight towards growth

stocks like big Tech safe safe growth

stocks save ones so I think that's why

you're not seeing as much of a sell-off

on uh some of the the mega cap names uh

we know that yesterday Apple had a had a

pretty big hit in terms of uh their

numbers for PC shipments Mac shipments

but the darn things down like one and a

half to two percent so not that big of a

deal uh the stock market is rotating

down at the time of recording this video

and I think a lot of that will be in

anticipation of CPI tomorrow so I

wouldn't judge the content in this video

by stock market performance today I

would go into CPI data tomorrow and see

does this make sense is it possible that

we could actually end up with the

benefits of pause for longer and

disinflation leading to great

opportunities for us to buy in the Nike

Swoosh and in the real estate flatness

while at the same time recognizing that

yes there are risks of Paul volcker but

they seem far-fetched in other words I I

think it's also worth noting that any

kind of d dollarization d dollarization

if you've watched any of my videos on

the dollar of the past three weeks here

I think this is also a far-fetched uh

idea I think war with Taiwan is

far-fetched uh so I I think these are

these are risks that that are less

likely in my opinion they do have some

Merit though uh so so we'll see uh this

is uh this is in my opinion something

that is uh is sort of an investing

Outlook and now within this scope we

could explore Pro or companies within

that scope so that's my thesis on what's

going on in markets so hopefully uh that

is helpful to you make sure to check out

those programs and build your wealth

link down below hopping over to the

course member live stream now appreciate

y'all being here another me Kevin reward

and we'll see in the next one and now

for my CPI production I believe that a

CPI month over month headline will

actually come in low at 0.1 percent

which would be fantastic I also believe

that core will come in and instead of

0.4 it will come in at point three so

just nominally a little smidgen Below on

both of the month over month figures

again the expectation is 0.2 and 0.4 I'm

at point one and point three that's my

take I think the banking crisis would

have to have kind of basically moved

these estimates a whole Notch lower by

about point one percent I think there

was a lot of oh in March and that's part

of my basis in addition to the research

that we're doing I don't think that

we're going to get a missed to the

upside I think that's substantially less

likely than just a match so I'm going to

go probably 65 chance 0.1 and uh 0.3 for

the core the uh base case would be uh I

guess I wouldn't call it the base case

because my base case is coming in low

but the market Space Case is 0.2 and 0.4

I would put that maybe a 30 chance and

then maybe a five percent chance we get

something hot so I don't see hot after

that banking crisis I could be wrong

though and I will experience being wrong

with you tomorrow if I'm wrong and if

I'm right I'm right so I'm optimistic

we'll put it that way see you soon

and now my CPI prediction my CPI

prediction is based on the shock of well

the banking crisis in March and I

actually think we hit a little bit of

more of a wall than economists are

actually projecting economists are

projecting 0.2 month over month and core

0.4 I think each of these will come in

Low by 0.1 percent I think we'll be

coming in at a CPI month of a month of

0.1 I only align with about four out of

about 63 economists surveyed by

Bloomberg on this so I'm super super on

the left edge of this now when it comes

to the the right Edge in other words

it's coming in hot I think that's very

unlikely I think there's probably a 60

chance we come in low point one percent

CPI month over month 60 chance we come

in at point three uh on the CPI core

month over month uh I think it's more of

like a 35 30 35 likelihood that we come

in at uh expectations which would be

point two percent month over month point

four percent month over month core and

then only like a five percent chance

that we come in above that's my take it

could end up being wrong if I'm wrong

we'll be wrong together but that's my

belief and I'm sticking to it I think

the Nike Swoosh is holding I think we

are going to start seeing at least some

early indicators of uh Services

disinflation no signs that inflation is

rebounding that's what we're looking for

so hopefully fingers crossed we'll see

you tomorrow morning at 5 30 a.m Pacific

Time 8 30 a.m standard eastern time uh

eastern time not Central I think I could

say Eastern Standard Time hey whatever

eastern time we'll see you then there

bye