저자: Kevin · 외국인
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트럼프 관세가 무역 파괴 수준이라 경기침체 위험이 크고, 금융기관·연준이 대응 준비가 안 됐다고 주장. 관세수입 과장, 컨테이너 출항 취소(주 80편) 등을 근거로 제시. 파월은 인플레 우선이라 연준 풋(시장 구조 대응)은 멀다고 봄. 리테일 항복(투매)이 아직 없어 바닥이 아니며 현금 비중 확대(contrarian)를 권함. 중국은 무역전쟁에서 카드가 있고 부채 여력도 있다고 평가. 7월부터 약세 전환, 현재 헤지 중이라고 밝힘.
다듬은 글
Folks, we have just been warned that we are not prepared for what is about to happen in the economy. This could be worse than the global great reset that everybody's been talking about for years. It might finally be upon us. In this video, I'm going to go through all of the news of the last 36 hours here.
And there is a lot not only having to do with Powell, but Trump, Iran, China approval ratings, disapproval ratings, trade. There's a lot. Let's get started. Today, by the way, is April 17th. The stock market will be closed tomorrow in honor of Good Friday, which means we have a 3-day weekend. Uh, in honor of this 3-day weekend, and to help with some logistics, we've also very briefly extended the sale on the Meet Kevin membership.
that price will be going up very soon. So, by the time a new video is out, the price will have been changed higher. So, go to meet Kevin.com to see that. You can learn more about that. We don't need to pitch this all over again. Let's just get into the video. So, first things first, we need to understand that when Donald Trump tells us we are making $2 billion per day on tariffs, it's just as good as Donald Trump telling us that we can bend time and space, which is an actual quote from the Trump administration.
And they're not even wearing a Don't Sue me brochure. No, we can't bend time and space and we're not making $2 billion per day. Best case scenario, we have made maybe $250 million per day in uninterrupted revenues per the customs officials who actually collect tariff revenue. This means that so far tariffs are collecting maybe 12% of what Donald Trump is suggesting we are actually collecting.
Now, why is this a problem? It's a problem because Donald Trump feels that we're making a lot of money while we're waiting for China to call us. But the reality is different. China doesn't need to call us because over the last four to six years they've been increasing their trade surplus with their trading partners that they now call their Asian family to minimize the impact that a trade war now happening would have on China.
In other words, China actually prepared for this war potentially happening at some point, whereas guess what? We did not. As usual, and once again, America sticks its nose into a problem or creates a problem. We don't actually have a backup plan ready. This is not good, especially when our president is misleading himself on how much money we're actually making from tariff revenue.
And this is where we're starting to see damage. Yes, actual damage and actual warnings. The World Trade Organization sees exports down 12.6% across USMCA regions along with a 7% decline in global gross domestic product over the long run due to trade fragmentation. This potential that we may just not trade with China anymore, which is crazy because so much of what's in our lives is made in China.
From walkietalkie baby monitors to go-karts to tires to power cables to batteries to car parts to plane parts. You name it. Our laptops, our iPads, our phones. So much of our economy, our service-based economy is dependent on the manufacturing that we have in China. And this is why a lot of folks are now really concerned about this potential decoupling.
leading Bloomberg's editorial board to tell us something that I haven't expected. But let's just say they just issued their warning. And like I like to say with the Warlave, you were not prepared for it. Take a look at this very closely. And I think it's important to watch closely. Ideally, quote, financial companies should have ample resources to absorb losses and prevent contagion.
They don't. In one of the world's most important markets, US treasuries, hedge funds are so leveraged that spikes in volatility can quickly send them to bankruptcy. Systemically important banks lack the equity capital needed to survive worstc case scenarios on their own. In other words, they all end up relying on the government.
And the government is in a place where we are cutting one in five employees in the regulatory environment that might be able to give us an early warning about cracks in our actual financial system. But no, we're cutting those jobs probably when we need them the most. Now, look, don't get me wrong. I think you, me, and the fence post, we're we're all a fan of saving money at the government and shrinking the size of government.
But the problem is we're potentially going into a shock that we are not prepared for to the point where now the editorial board of Bloomberg is saying we are walking into a manmade disaster and we are not ready for it. Our banks aren't ready for it. Our Fed isn't ready for it. Our hedge funds aren't ready for it.
Our businesses aren't ready for it. Our debtor companies aren't ready for it. In other words, the seeds are here for a real financial crisis and the editorial board is telling you to buckle up and get ready. And that is a warning you very, very rarely hear from Bloomberg. Maybe it has to do not only with the World Trade Organization information that we got on longerrun GDP, but the fact that we just saw 80 sailings cancelled out of China in the span of just one week.
Now, you might think, "Ah, 80 sailings, what? 80 80 cargo deliveries? Who cares?" But mind you, every single cargo ship could contain 8,000 to 10,000 containers. 80 sailings. That works out to 640,000 to 800,000 containers that do not show up in America. Who unloads those 640 to 800,000 containers? Robots?
No. Humans, truckers, trains, warehouses, storage yards, labor, logistics, all of these businesses get the downstream effects of a lack of trade. And it's really bad. And it's probably why this sharp deterioration we're seeing in trade is leading to such excessive warnings now from the editorial board of Bloomberg issuing a warning that we are not prepared to absorb the losses that are about to happen.
This is bad. like things are getting so weird with how these uh you know companies are putting out warnings that I'm starting to wonder, man, this is the time for me to start turning bullish because everybody's starting to get pretty bearish out there. But no, I have a rule. I wait for JPA to pivot, which don't even get me started on what happened with JPOW yesterday.
We'll talk about that in just a moment. It's worth noting the editorial board of the Fed also thinks that or of Bloomberg also thinks that the Fed should start bailing out hedge funds because there's so little liquidity in our treasuries market. No wonder our treasuries are selling off. But we also have a lack of liquidity in the stock market, which isn't great and doesn't bode well for potential future returns for the rest of the year.
But what's happening so far is while the stock market has stabilized, Donald Trump's approval ratings, at least compared to his first term, are not. According to his first term, we as usual, right after inauguration, you get a little bit of enthusiastic bump. We got a little bit of that over here as well, not as much.
But we are doing significantly worse on Trump 2.0 compared to Trump 1.0. likely because a lot of the voters who voted for Trump 2.0 were a different cohort. Over 70% of voters who voted for Trump 1.0 were elderly and white. The Trump 2.0 voter, you only had about 40% of voters that were elderly and only about half to about 60% of voters that were white.
In other words, you had a much more diverse and younger voter for Trump. And a lot of experts think those are the people that might be flip-flopping against Trump because they're getting pissed with what's going on. Now, is that to say that, oh, now all of a sudden all of those people have Trump derangement syndrome?
No. I think people are just responding to the fact that we are now in a place where continuing claims are rising yet again. 1885 versus the 1870 expected this morning. Empire Fed manufacturing wasn't great yesterday, although employment still somewhat stable. Christine Lagod was yapping this morning about how you have to basically be crazy not to see some of the damage that's being caused in markets or environments right now, which is scary because then when you jump over to the Philadelphia Fed read, what do you get?
You get some of the worst future and current activity that we have seen since the pandemic. These aren't good reads. Now, obviously, there has to be some bit of a bright spot, right? And yeah, there is. For example, rich people are still spending money on their American Express cards. Artificial intelligence spend is still booming per TSMC, at least with the rich companies that are able to afford the chips, which is good.
So far, still not seeing that wall hitting AI spending yet. No changes yet, even because of tariffs. So, this is good news from TSMC. But what did we get from the Federal Reserve yesterday? Well, my opinion, I mean, we had an emergency course member meet Kevin membership live stream on on exactly this where afterwards I'm like we all went into this knowing what Powell was going to say.
Like it was no surprise. So why did the market sell off? Well, the markets probably sold off because you actually have people who are buying the dip misunderstanding that Jerome Powell refuses to repeat the mistakes of the 1970s. You have to look at the Federal Reserve in very simple terms. If we are on a scale of one to 10 when it comes to inflation and jobs, five and five is balanced.
When inflation is at a five and jobs sits at a five, the Fed is happy. Jobs right now are balanced at a five. But inflation's high at a seven. So what's the Fed going to do? They're going to fight inflation. Well, what if infl, you know, the jobs market goes down to like a four and a half and inflation's still at seven?
Well, Jerome Powell yesterday told us they're going to focus on inflation and they need to make sure that inflation does not become entrenched. So, they will continue to fight inflation, inflation, inflation. you would actually have to see the jobs market get so much worse and inflation get a little bit better before the Federal Reserve actually flips and starts bailing out markets.
In other words, the Fed put is probably a lot further out than people were estimating. Now, people who have been following me and are part of the Meet Kevin membership, you're not surprised by this because we know the Federal Reserve is not going to U-turn anytime soon. In fact, they're probably because of this tariff drama going to U-turn too late.
Now, to some extent, you could argue that's their fault. But on the flip side, it's entirely possible that these trade destroying tariffs are not transitory. 2018 tariffs, let's be real, they were transitory. Okay? You got a bump in prices. Washing machines and dryers went up. We had a onetime price increase.
That was transitory inflation. The problem is with the tariffs that we now have on China, we are way beyond transitory tariffs where we actually sit or at trade destroying levels of tariffs, cancelling 80 sailings in a week overweek report is horrible. Trade is down 50% in a week-overweek report. CNBC just had this on their front page.
This is actually trade destroying. And trade destroying is like a supply chain shock we saw during COVID where you actually get real inflation because you have to rebuild supply chains. Rebuilding supply chains is very hard. You can't do it overnight. We have an economy that's built on people taking service jobs and spending money on cheap goods and services.
We don't have an economy that has the infrastructure for all of us to go work in factories. We don't have the skills. We don't have the infrastructure for it. We don't have the factories for it. We don't have corporations that have the willingness to pay our wages. And so this is why people say like, "Oh, but Kevin, you know, you're always usually Mr.
Buy the Dip. Why are you not buying the dip?" Well, because I like to be a contrarian. That's what we do with House Hack as well. It's one of the reasons why I think we have just raised over $4.5 million in less than three weeks because people look and go, "Okay, I want to diversify to a contrarian bet.
That's why I like listening to Kevin. He's a contrarian and he's going to invest in real estate like a contrarian." When everybody's investing in the bubble markets, he's investing where they're not. And then he can swoop into the bubble markets when everybody's panicking at the bottom. It's exactly what we're doing with House Hack.
Okay. But where do we sit with levels of capitulation for retail by the dipping? Well, take a look at this right here. We've got a chart for you. Look at this. This is from Bank of America. It's the global equity risk love sheet. Basically, what you want to do is I drew this red line here. You want to look at this red line.
When the blue line hits the red line, you've hit capitulation. Okay? Is the most simple way to understand this chart. You could see you hit capitulation in ' 08 09 the end of 2011 almost here in 201516 you hit capitulation in 2020 and then you almost hit capitulation again in 2022 towards the end of the year.
Okay, where do we sit right now? Well, right now we sit at like 2019 2018 levels. In other words, just a regular dip. Like this is a run-of-the-mill dip. This is not a level of capitulation where people are actually panicking. Nobody's panicking. People keep buying shares. In fact, when you look at Goldman Sachs reports on this, retail continues to be a positive net inflow into the markets.
Markets don't bottom until retail capitulates. And retail usually capitulates right before the Federal Reserve panics and bails everybody out. And then you have your true bottom formed. So, we're not at that retail capitulation yet, which means a contrarian says, "All right, I'll hold my cash until retail finally gets shaken out." Retail has not gotten shaken out yet.
Now, one of the reasons retail probably hasn't gotten shaken out yet is because everybody's been trained, oh, by the dip, the stock market always goes up. And this has been true for the last 17 years, but we've been under a QE regime. We are going into this potential risk recession without QE and without a stimulative Congress.
There's no quantitative easing. There are not even low interest rates. We have high rates, quantitative tightening, and a government that wants to cut spending. This is the opposite of a buy the dip moment. That's my take. Okay. But I'm using the data to analyze this and I'm finding it well very undesirable to invest at some of these levels.
Now, of course, Donald Trump, I have this written down over here. Donald Trump is now complaining about Jerome Powell, saying the ECB, which they did cut today for the seventh time. They brought rates down to 2.25. And then he nicknames Powell too late Jerome Powell. Too late Powell of the Fed, who was always too late and wrong.
yesterday issued a report which was another typical complete mess. Oil prices is down, groceries, even eggs are down and US is getting richer on tariffs. No, we're not getting richer on tariffs. And congratulations, wow, supply and demand. When you stop killing birds because of a bird flu culling, wow, egg prices come down again.
Oh, and oil prices are down because of tariffs. No, because the oil market is responding as commodities are to the very real reality that we might be going into a pretty dang dirty recession, which isn't good. And that's what oil does. It goes down going into a recession. Uh, and so then Donald Trump says Pal's termination can't come fast enough, which now a lot of people are speculating, oh my gosh, is he gonna try to take any semblance of certainty we have in the market away by firing Jerome Powell?
Like I'm stressed out over all this stuff because it's so bad and and I've I you know I've been yelling that the conditions have been set for a recession for about 10 months now. I turned bearish in July. Ah it's been like nine months. I turned bearish in July, started hedging and now we're in a place where Donald Trump is lighting the fire.
It's not good. Now a lot of people were worried, oh my gosh, is Powell going to get fired? No, I don't think he's going to fire Powell. Powell's term is up in a year and one month. Okay, Trump will wait through that. But what will happen is if there's a recession, Donald Trump will use Powell as a scapegoat and Musk.
Elon Musk's Doge. Oh, it was so efficient. It was so good. We caused a recession. Oops. But we could have avoided a recession if it weren't for that darn Powell who was just too late to cut rates. Well, how was he supposed to cut rates when you were creating supply chain level destruction that we saw during COVID to our markets?
It's impossible to cut in the face of that because you're going to entrench inflation and then you'll risk repeating the 1970s where you create such a disaster that you end up having to get a Paul Vulkar who doesn't raise rates to 5% or 5.5% but they end up raising rates to 17 18 20% to finally break the back of inflation.
That's worse than Powell waiting and being late going to 18% rates. Could you imagine that? Be insane. At the same time, China is combating Donald Trump's tariffs with the idea of the Asian family. This is basically where uh Xiinping travels. Starting on Monday, he went to Vietnam. Now he's been in Malaysia.
He allegedly signed 45 deals in Vietnam. Now he's signing deals in Malaysia. He's traveling to all these other different countries in the Asian regions. And what he's doing is he's saying, quote, "Together, we must stand against hedgemenism, power politics, and we should resolutely oppose any attempts by external forces to interfere with our internal affairs." He's also doing this in Europe.
Basically, all of our allies, Xiinping is going to signing deals with them. Now, this could all be propaganda, but to me, it's starting to sound like Xiinping is signing deals and we're getting concepts of deals. At the same time, there's talk about China building this military city south of Beijing.
And there are aerial photos now leaking about this massive military compound that China is building as they potentially prepare for war to take over Taiwan. Because again, what does the democratic peace theory tell us? The more interconnected we are with trade, the less likely we are to go to war. Well, who just destroyed the connections that we have to prevent war?
All right, you see where we're going? So, in other words, the odds of war with Taiwan have substantially increased. At the same time, China is trying to rapidly build its nuclear arsenal. You know, US is number one. Then you've got Russia, although most of their nukes probably suck and are broken. Uh, and at least we hope.
Uh, and and China actually doesn't have that many. You know, maybe 300, whereas we have like 6,000. Okay. Well, they're going to ramp that up and they'll have more than us. So, China's a big power. It's a big stick and it's not great because it seems like every single day we get more and more slams on China which just drives more and more of a wedge between China and us.
China retaliates with more tariffs against us. Then we sanction the Iranian oil that China buys. Then China comes back and says, "Okay, we're going to limit, you know, certain critical mineral exports or movies or, you know, whatever, whatever." You know, we start getting limitations on potentially corporations that do business in China.
TBD, China's trying to be businessfriendly and accommodate free trade in China, which is so weird to think that the Communist Party of China is the one that's trying to accommodate freer trade, but that's just the environment that we're in right now. So, um, you know, I think it's important, mind you, to be very vocal about our frustration with tariffs because from an economic point of view, there's there's no logic to what we're doing.
We have so much building to do first. We have to fix our schools. We have to fix our infrastructure. We have to have, you know, a functional supply chain in America. We have to have factories in America. We have to have the energy infrastructure in America. We don't have any of that. and we're starting a trade war to where all of a sudden we're not going to be able to order power cords anymore, you know, in in probably as little as 30 or 60 days because we can't get them from China anymore.
So, we'll have to get them from somewhere else, which will also be tariff. So, prices will go up and then yes, we'll have inflation and gold actually does well during those inflationary times, but the problem is people won't be able to pay these higher prices and that's when you go into a negative growth environment, which is aka a recession.
Then you have a recession and prices actually plummet. Usually gold plummets too at least until uh you know the Federal Reserve U-turns and starts turning on the money printer again. So then people get worried about inflation again. Uh so Zero Hedge had this idea that you know China only has three options.
They're like China could concede, they could devalue their yuan or they could unleash fisc fiscal stimulus. Okay, which will push their debt off the chart. Uh no it won't. So, there are a few things you have to know here about China. First of all, those are not the only three options China has. A fourth option China has is just partner with other countries for more trade and offset the trade that they do with the United States, about 15% of their GDP.
They've already been growing their trade surplus with all of the other countries that they trade with in preparation for this. So, they could probably outlast us on this. We need their product more than they need us. So, I don't think we have the cards. I think China has the cards, which isn't good.
China can devalue their currency. They can unleash stimulus and they can partner with other countries. And they do not need to concede concede to Donald Trump. They can do all of those things. Now, the problem with all of this is that people think, "Oh, but then their debt to GDP is going to go up." Okay.
Well, what's the US debt to GDP compared to China's? Well, US debt to GDP is 123%. UK is 101%. Italy is 134%. Japan is 249%. China 84. In other words, it has a lot of room. It has a lot of room to expand their debt to GDP. Now, I'm not saying that they should, but they certainly can because, you know, let's take uh Chinese GDP and let's multiply it by about 84%.
That would give them about $2.5 trillion of space to get to just 100%. And they still have 23% of a lower debt to GDP ratio than we do. So, China is actually in, oddly enough, in a better position to stimulate than we are, and they already are. Meanwhile, their economy is also growing. Now, I don't trust all of the Chinese numbers.
I, you know, I don't I don't know how much they're really growing. I'm skeptical of it, but I definitely don't think going to war with China in a trade war when we're not prepared to take over this sort of manufacturing is a great idea. I think it's a terrible idea. And you know, I actually think that one of the reasons there was sort of this rise of like weird acceptances of bizarre social wokeisms like this whole like pronoun thing or whatever.
I think one of the reasons we saw this uh was driven by a a lack of people fighting uh those issues or those ideas. sort of the passiveness and I think it's really important that we fight these bad tariffs because recessions are bad for everyone. So I don't think anybody should be praying for a recession.
I think fortunately myself and house hack we're in great positions uh to where it doesn't matter recession or not but I think about the millions of people that are going to be suffering in a recession and it makes me really concerned and so this is why I think like why why would you buy equities right now like the last thing I like I want to make the most contrarian bet I possibly can hence why we're building the cash horde at house hack and I think why so many people are investing uh in it and this is why so many people are joining the meet Kevin membership that are like all right let's get the perspective that we really need to hear let's actually do the fundamental research and understand what's going on mind you it's not like this is just me you've got to look at companies not only companies like Google that are quietly laying off workers but you've got to look at the research institutions like TS Lombard who are telling us that we are not pricing in a recession the problem with underpricing a recession is that It means we have a lot more room to fall when and if the stock market goes poopy dupies.
See, we think it will be short-lived and recommend selling into rallies and staying away from buying the dip. In other words, this recovery that we've seen in the stock market, they think will be short-lived and they recommend selling into rallies and staying away from buying the dip. And that's because the market is not accurately pricing the perspective hit to growth emanating from Trump's policies.
US consensus growth forecast for this year are too rich at 1.8% on a fullear basis, which is inconsistent with a downturn taking shape. Weak jolts hiring, softer corporate profit margins, more aggressive tariffs, all collectively factors that could be powerful enough to push the US economy into a recession, especially as rapid cooling of real personal income growth leaves little room for error, all while equity allocations are at all-time highs.
And this doesn't even factor in the effects of investment spending and hiring intentions emanating from the pervasive uncertainty that is stalking US firms in freaking English. A lot of things are getting a little poopy dupy and institutions are finally waking up to it. I was early as usual. I come early on these things.
Sorry, just adjust for that. But I will always give you my honest opinion, even if it's not the most popular thing to say at the time. I know there are going to be a lot of people that are like, "Oh, Kevin, it just sounds like you caught TDS." No, I I I I didn't catch Trump derangement syndrome. I have always had tariff derangement syndrome because it is full stupidity what we are doing.
I'm all for national security in America, better education in America. I'm all for government efficiency. Nobody is anti- those things, but what we're doing right now, destroying trade, destroying it. We are not prepared for this recess.
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