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이번 주 연준 FOMC·CPI·PPI·소매판매 등 주요 지표를 앞두고 긴축 지속(higher for longer) 또는 경기침체 시나리오를 검토. 임금 상승률 둔화가 서비스 인플레이션 둔화로 이어질 것으로 보며, 시장 상승 기조에 대해 신중한 낙관 입장. 기술·반도체 선호, 대형 소매(홈디포 등) 약세 전망. 본인 보유 종목 언급.
다듬은 글
hey everyone me Kevin here coming to you from a lake in Canada and I'll tell you it is awesome to just sit in the middle of the lake and think and of course what do I think about nothing other than the Federal Reserves see the Federal Reserve has a very big weekend coming up a lot of the Bears are telling us that this is going to be the week that we finally get rug pulled and a lot of the Bulls are saying this is the week that we finally go to the moon so which is it and what expectation should we have going into this week especially since I'm going to go through numbers in terms of not only the Federal Reserve but listen to these data sets we've got coming out CPI this week PPI this week and retail sales all this week along with the FED potential hike and the ECB potential hike that's a lot coming out this week so let's discuss the first thing that we have to keep in mind is that the Federal Reserve has to this week really Telegraph to the entire world what strategy are we undertaking no matter whether you are a bull or a bear this week will be that moment where the Federal Reserve finally has to decide what is more important to us maintaining the economy in such a way that we don't have mass unemployment and we fight inflation with everything that we have or do we fight patiently that is we patiently allow disinflation to occur we patiently allow the markets to resume their activity and we essentially slowly Nike Swoosh recovery back to where we were and potentially Beyond that's the question and the reason this week is so pivotal for that is because obviously it is widely expected that the Federal Reserve is going to pause in pausing the Federal Reserve will likely give us a hawkish pause that is they'll talk to us dirty they'll talk to us about how they're going to in the future be open to hiking again but not only are they going to do that they're going to give us a summary of economic projections and SCP and they're going to use that yeah Jack um that there's a I don't know what it's called this a person getting yeah there's there's somebody uh what are they called uh like a um what yeah what are they called water skiing yeah there are water skis over there are people having fun out here all right Jack I got to keep talking about fun things like the summary of economic projections okay you want to say hi really quick yes all right so back to the summary of economic projections this will be another tool for the Federal Reserve to Telegraph how seriously they want to take inflation and there are two ways to really go here you can go in the direction that the Bears expect which is okay the stock market is going up real estate is starting to go up uh again since January it's been trending up we still haven't seen that surge of inventory it is what it is markets we just have to absorb What markets are doing and play the best we can right so markets recovery and the FED might look at that and say wait a minute in 2022 we were actually hoping markets would go down weekly real estate market because that via the wealth effect contributes to people feeling less rich and therefore spending less money that puts less pressure on Supply chains which puts less pressure on prices right jack would you mind sitting down you're distracting me dancing around like so anyway that puts less pressure on inflation so the idea was okay let's ruin people's wealth basically wait for a reset so to speak as drone Powell suggested and uh then inflation will go away because there'll be less availability of capital for people to make investments to hire people uh to buy goods and services and that'll reduce inflation uh Mr Schiller Robert Schiller uh famous for the case Shiller index for Real Estate home prices is a famous economist He suggests that real estate home values have more of an impact on the wealth effect that is people's propensity to spend money then the stock market but personally I as an anecdote I somewhat disagree with that somebody who's more heavily exposed to stocks I personally believe will feel a little bit more like yeah we could go on that vacation if stocks are up versus when stocks are going down and you're like I don't know man and we're gonna hit a margin call like logically it seems to me that both of those wealth effects would matter but who knows so a lot of the Bears right now and I've been I've been reading a lot of what the Bears have been saying so that way I can have a really good understanding of what's going on uh at least what the bear argument is the Bears are reiterating that look you can't have the stock market going into a bull run territory when the fed's in a tightening cycle you need to crush the stock market rally and therefore this is the week that stocks are finally going to get their reality check so load up the shorts and quite frankly loading up the shorts could have contributed to the rally that we've seen over the last two weeks when people are buying short position put options for the 16th I think I previously I said the 17th it's the 16th it's the Friday then uh thanks to Delta hedging and basically the way my these these um uh market makers work is they start buying the counter position a couple weeks early and so you have this really weird phenomenon where potentially in front of a lot of shorting you get this run-up of box which we've kind of seen so that's somewhat consistent with this leveling up of shorts or Hedges going into this particular week here so you've got the FED set up for telling us what's more important slowly fighting inflation or quickly fighting inflation you have the opposite of the wealth effect coming right now no matter what you believe about the wealth effect the reality is things are up right now so if the FED cares about the wealth effect they got to drive markets down this week if uh and that'll prove short sellers correct however that thesis is based on the Federal Reserve needing to cause more unemployment and see this is the interesting part about the FED what if we get a Fed which we may that says hey we don't actually need to destroy the economy we have enough disinflationary pressures that if we just stay on the course we are now in other words stay at five percent and inflation the next inflation reports continue to come in as they are currently we expect we will return to two percent inflation by say the first quarter of 2026 which their summary of economic projections may show well in that cas have to hike again they just need to stay at this level for higher four longer right five being the higher level and then for longer now the problem with that is it also assumes uh that the best thing to do is just stay in stocks but wait a minute markets at least 60 of Bloomberg economists are still projecting a recession this year that's because if you look at the bond market it's still insanely inverted but that actually suggests that the FED has maybe gone too far that they've already over tightened that inflation isn't actually the boogeyman the real boogeyman is the earnings recession and that we're really going into a harsh recession and because we're going into a horse recession and then that's when the job loss Will Truly Come when that earnings recession occurs that's when we'll see the mass unemployment at the same time as stocks potentially hit new lows that's sort of the argument well then the Federal Reserve actually has to balance that as well and ironically that's a scenario that would suggest Fed rate cuts so really what I've just set up or three scenarios that we're trying to evaluate and that's what makes this so blurry you're trying to evaluate hey hey is inflation sticky you need to hike more the second scenarios no no we're good inflation expectations are anchored just be patient and let this slowly roll off just like we've done historically opportunistic disinflation slowly roll inflation off and the third scenario is you've already gone too far we're going into recession we're screwed in scenario number one where they hike rates even more and more and more we go to a six percent terminal or whatever you don't want to be you know you're going to have some downside to stocks in scenario number three where we go into recession you potentially have some downside to stocks but then again you look at Germany you know they're in a recession and there's stock market is at all-time highs and then you have this Middle Ground which is often associated with a soft Landing which is maybe no recession and wow inflation just slowly Trends away very slowly it's everyone's guess obviously as to what's going to happen the bond market says the third scenario is going to happen the Bears say the first scenario is going to happen that is we need to raise rates more to make sure we get rid of inflation but then we're going to cause that dirty recession so you'll end up with the third scenario anyway and then the Bulls are in the middle going I think actually everything's going to be okay and I think this is where it's worth me imparting my opinion so I wanted to catch you up with fact uh and then we're going to go through data as well we've got some data to go through as well uh see like here's one of the Hawks going uh this next fed meeting is going to usher in the next phase of the Central Bank hiking cycle and they use the Bank of Canada to suggest that that's it here it comes here comes the next hiking cycle they've they've gone from pausing in January to starting to hike again in June uh we're going to have a shallower monetary easing path Beyond 2023 that's going to be something the markets have to price in and all it's going to take is a hot CPI report here to knock the fat Off Their Rockers and let's go through some inflationary projections as well here but let's first give you my opinion and then I want to hit data okay so so far I've caught you up with the FED now we're going to go into my opinion uh also I'd like to announce uh that we're going to be uh slowly slowly slowly remaking a lot of the lectures in the stocks and psychology of money course and the real estate investing course uh that's going to be completely for free for existing members and uh once that process is complete we'll have another quite large price increase because the Quant the I think the quality is going to go from amazing already to amazing times too uh so feel free to use the coupon code down below uh we're calling it AI more this time because we're going to be incorporating AI to every lecture as we go through and remake the courses uh which will be really incredible so really remaking everything thanks to AI now which I'm very excited about so stay tuned for that but use that coupon code down below so what is my opinion uh and Jack I've got maybe about three or four more minutes all right so my opinion is that we are right now looking at a wage disinflationary process happening if you look at wage growth is basically a chart that peaked in January of about 2 2022 and CPI peaked about six months later okay what's interesting about that is the rate of wage disinflation has fallen the most in the last month compared to the last six months therefore they're after there before so in other words we've started seeing wage disinflation really come down and in this last month it's come down even more in other words the next six months we're going to slowly start seeing that wage disinflation priced into CPI well where do wages generally show up in CPI they show up in services is the last argument the Bears have that Services inflation is sticky and because Services inflation is sticky we are going to have to hike more but I think the Federal Reserve will take a path of patience and say you know what let's let's give it let's wait for the data to see will that wage disinflation translate into Services disinflation if it does we could stay here and eventually talk about cutting if it doesn't if for some reason Services inflation takes off again well then obviously we have a problem and we're going to have to hike more and we're going to keep that optionality open so if I were the Federal Reserve right now I would be very transparent and say look at this point with the data we have and inflation expectations where they are we think inflation will roll down to two percent by the beginning of 2026 and we are okay waiting that long however we realize markets are up housing prices have started to rebound again and because of this there is a risk that people spend more money and if Supply chains were not available to absorb that additional demand because remember that as well a lot of people like well people go back to spending that inflation will happen no because Supply chains could have potentially been prepared for a new surge of spending again this is why I actually don't think you're going to see a chip shortage again because you had Supply chains build up massively and even though now everybody wants chips for AI we're ready and available to manufacture more although there's a limit to that okay because even Elon Musk is complaining that he's starting to see some trip shortages again so there's a limit obviously to everything but the point is that in most areas we've really built up these Supply chains again so anyway um so the FED should be very transparent and saying look if Supply chains are available to handle the extra demand and as a result we don't actually see a a pricing pressure then we are okay patiently waiting until the beginning of 2026 for inflation to return to 22 uh in in such a case as long as we don't get hot CPI PPI data between now and then we don't necessarily need to keep hiking we are at sufficiently restrictive levels and we will stay here until we are convinced that we are not going to unanchor inflation expectations which they are anchored very low right now and we are not going to return to any kind of larger inflation uh it reports that's what I would say if I were the FED but then again the FED can't necessarily say that because there is a risk of the FED saying that leading to people going all right take out every loan we can get oh there's a b take out every loan we can get and uh and and spend money uh and then that actually ends up creating too much of us spending oh it's right behind me I mean I don't really mind if it's just sitting next to me sometimes it's not coming after me but anyway uh that is going to create uh this potential risk of people coming out and borrowing money and spending money like crazy again so that is a big risk uh so um the fed's going to have to figure out how to massage that message uh and there's going to be a lot of reading between the lines to determine okay is the Federal Reserve uh going to uh going to be as transparent as this probably not because that level of transparency risks uh basically inducing too much buying and too much recklessness although we're already starting to see fomo trades come back like crazy right the exception of old coins and crypto but that's really a topic for a different video and that has a lot to do with regulation not so much uh the Fed so let's get to the data and wrap this video up so here's the data first of all uh we have uh some researchers uh credit agriculture credit Agricola believes that they think headline CPA is only going to rise by 0.1 percent month over month slowing from the point four percent we got last month uh and then year over year we're going to see CPI go down to four percent down from the 4.9 last month uh now what we'll also expect Jack what's going on I'm just amazing okay because they're like kick in your leg it makes me think you have to like go to the bathroom or something really badly all right can you just sit down and chill all right so uh regarding um month over month core they expect core to rise 0.35 and the year over year slowing to 5.2 uh now they also believe that this is going to lead to a gradual core slowdown to 3.5 this is credit agricola's expectation this gradual slowdown of core is going to really trigger the fed's patience is the Fed willing to be patient and that's what we're hoping to get as a signal this week hopefully is the answer but anyway when we look at uh the Bloomberg Economist projections for CPI CPI survey for month over month is actually 0.2 as opposed to credit agriculture is 0.1 and then core they're looking for 0.4 which actually if we look into the detail it's actually 0.37 so we'll see when we actually get the numbers but probably a 0.2.4 anything less than that would be good news for the stock market and the FED because really if we get a bad CPI release Here the FED will give us a 25 basis point hike the markets will price it in right away they'll send a text message to Nick T going we have to switch to hiking he'll publish a Wall Street Journal article and then every mainstream news organizational published an article going fed might have to transition to hikes and then they'll they'll hike again but it would really require a miss that none of the leading indicators are really suggesting we're going to get so I wouldn't be betting on a Miss but then again if most people don't bet on a Miss maybe the most profitable bet isn't betting on a miss right that's the irony like if everybody knows the stock is going to fall everybody shorts it and then nobody makes money shorting it it's this crazy irony especially when you're playing options anyway uh okay so then we have PPI the very next day we actually think PPI headline month over month will go negative point one PPI core will be 0.2 uh point two is actually fantastic because that brings you to about a 2.4 year over year uh when you annualize him uh then of course we have the rate expectations we're expecting to hold but then we also uh so let me be clear here on CPI we're going to get CPI Tuesday the 13th at 5 30 a.m I will be live streaming even though I'm in Canada so stay tuned for that uh then we are going to get CPI or PPI Wednesday at 5 30 a.m I will be live streaming that even though I am in Canada then we will be covering the fomc meeting on Wednesday at 11 A.M California time I will be live streaming that even though I'm in Canada retail sales Thursday morning at 5 30 a.m I'll be live streaming that we're expecting a month over month advance of negative point one percent uh that's going to be after the fed's meeting so we're really not terribly expecting that to really affect uh the federal reserve's decision making because the only Central Bank making decision that day is actually the ECB and they're actually expected to hike by 25 basis points so we'll see so most economists right now expecting this to be a hawkish pause uh and then we're looking for data on what's going to happen with these next uh with these three scenarios these three scenarios playing out I would argue that if we're latively shallow and in a recession in that lower scenario you would expect Fed rate cuts and honestly even though you'll have volatility in stocks and you'll have some kind of earnings recession much like what I've been calling for in the Staples sector you know the targets the Costco whatever I really think the the lows is the Home Depots I think these guys are going to get hit a lot more than than the tech that's why I've been positioned in Tech and growth uh certainly since November of 2 2022 basically been all in but it did get get in pretty early before that as well uh which you know still led me to ride down a little bit but oh well it can't be perfect with the timing but anyway uh I still believe in in Tech and chips uh some of them are getting a little frothy though so we have to be a little careful I think probably the weakest sector right now and the most undesirable sector is actually retail it's gonna be like your your non-staples retail more of your discretionary retail so like uh your your Etsy right uh just as an example so I'm watching that maybe like even your Dave and Busters although that's done well after earnings so I'm watching those I haven't made any moves on those yet so uh then after that and of course when I do I'll send an alert to everybody in the stocks and site group uh then uh after that as far as the the middle case scenario I want to be in stocks so recessionary scenario I want to be in stocks middle case scenario I want to be in stocks and oh fighter jets right there Jack yeah and then in the uppercase scenario which is the Fed hiking more honestly I'm not terribly and let's see if you guys can see the Jets Jack can you point at them point at the Jets yeah I don't think we can see him unless we come back over this way I don't know if they will um anyway uh so the top scenario which is okay well the FED might have to hike more honestly I don't really care because in my opinion the Federal Reserve oh they might be turning this way in my opinion the markets were pricing in Paul volcker last year and in pricing and Paul they are coming this way they're putting on a show for us what a treat they're trying to remind everyone oh my gosh they're gonna come right over us look at that where are they there they are oh that's so cool oh wow Jack we gotta fly by dude that was so cool they're like hey it's me Kevin making a video trying to pitch his coupon code let's silence them oh that's awesome uh oh okay wow that was awesome so uh last scenario is is fed hiking I don't care that's why I want to be in stocks because even if they hike more I don't think we're pricing in a Paul volcker so quite frankly even if raids go up to six percent I don't think we get back to New lows to Paul volcker levels uh so basically in every scenario I I lean bullish am I suggesting things are going to go straight up and it's all in in video or mean stocks right now no of course not you know so so I think there's a cautious optimism that I have I don't think that's associated with Perma bullish because you know obviously the beginning of last year we were extremely bearish but going into this year we've been extremely bullish In fairness because it was the right move I mean I remember November December January March people like Kevin we should be going all in on crypto I'm like why these stocks have such great fundamentals they're so cheap right now now a lot of things I will say Have Become uncheap again right Tesla's pegs back over two and I'm like dang it you know end phase is still someone cheap uh and the housing market is actually trending up which should be good for sales again but it's expensive to borrow for solar panels right now so TBD but anyway I'm looking for more deals I suppose I would I would pay attention to I'm not convinced 100 yet but I'd be looking at things like uh and phase Etsy uh and um and you know honestly I'm looking for more suggestions so if you give me some more suggestions they can go oh ubiquity ubiquities Dirt Cheap right now uh that's another one that's ticker symbol UI so anyway uh check out those I do own all three of those so I want to be transparent about that I've exposed to all three of those uh so it's not that I'm just trying to pump my book it's it's that quite frankly I I I'm looking for where the other deals are and I'm like dang things that were cheap aren't cheap anymore so anyway hopefully that's insightful to you uh let me know what you think leave a comment down below and uh we'll see you in the next one remember we are doing a complete course refresh Jack you're welcome to turn the engine on and we're doing a complete course refresh for stock since I can zero to millionaire real estate investing oh Jack you have to put it in neutral pull the stick all the way to neutral there you go okay now you should be able to turn on and um we'll see you soon thanks bye
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