저자: Kevin · 외국인
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미국채 10년물 금리가 장중 5.13%로 2007년 이후 최고, 일일 15bp 급등. 시장이 연준 금리인상 4~5회를 반영 중이며 이란 핵합의 여부가 관건. 5년 기대인플레는 큰 변화 없음. 금리 상승으로 고PER주(애플, 엔비디아) 밸류 압박, 고성장주(테슬라, 팔란티어)는 상대적 영향 적다고 주장. 단기 변동성은 예상하나 이란 합의 시 매수 기회라는 입장.
다듬은 글
Well, holy [ __ ], today was just an incredible day for a painful deal to be struck, and now markets are pricing in a total of five interest rate hikes. It's gotten even worse in the last few hours . Now I have to drink from my mug of pennies, because, holy god, I'm a little shaky about this yield. OK.
Oh, boy. Let's talk about this, but wait. I have to take off my green watch. Okay, let's begin. Hooray. Obviously, uh, these Russian yields have been crazy, and the markets are really pricing in five rate hikes. I'm going to show you the data and statistics in a moment. We will also look at inflation breakeven points.
We're going to try to figure out what this really means, because this is obviously bad news for Scott Bessant, who was trying to control the long end of the Treasury curve, and the exact opposite is happening. Of course, things are not going well for Mr. Warren Buffett, who just yesterday, well, Berkshire Hathaway, well, announced the acquisition of approximately 11% of Lennar stock, indicating their potential bet that perhaps we are reaching the end of these high- rate cycles.
Probably not yet. Apparently, there are still some difficulties left. Well, the good news in the short term, for whatever it's worth, is that when we were at 714 and 700 in the queues, that's when we bought on the dip. It's all here, in this range. This was our buy zone on the downside right here. We are still way above that.
We're at 741 on the Nasdaq 100. We're so close to all-time highs that we just set 741.75 divided by 748.40 puts us within 0.9 %. So we're literally within 1% of the all-time highs of the Nasdaq 100. So I disagree with this idea that buying on the dip right now was a bad idea. I think it's not just a matter of patience, but also a fundamental economic shift that suggests there may be some more challenges ahead.
So let's be completely frank about this. About 2-3 months ago, in the summer, with the polls regarding Leo, we also bought during this nonsense. Basically, while the big, nasty decline was going on, we thought, “Okay. This is a dip buy. The market will recover. Okay. It has recovered .” Today we have to accept that we probably won't lift interest rate hikes until the war with Iran is over.
Well, that's a bit problematic. Well, some pushback was understandable. So some volatility here over the next few days is not a surprise. And I'm not trying to impose it. I'm just trying to remember it. Even this morning on the Alpha Report, this morning on the Alpha Report, I was just being transparent about it.
We have been optimistic the last few days. We really got through the bullish predictions in this market. But this morning we said, " Hey, today might be the day to sell AMD calls." Today could be a day to be very cautious because the markets don't like the fact that we do n't have a deal yet. It's been 12 hours.
"Where is the deal?" Yes, it will take some patience, and that's okay. So I expect volatility over the next few days until we actually make a deal with Iran. And if we don't make a deal with Iran, that's problematic. And that's why we're going to touch on that here. Let's talk about yield and what it means for the long-term thesis.
First of all, this morning, obviously, we had an impressively bright PMI reading for September. This has taken over the interest rate market right now, and I took a screenshot to show you it in its raw form right here. Because, you know, some people just like it raw, okay? So, this is not good. This morning we have an increase or maximum percentage increase of 3.66.
So exactly how many raises are we expecting. Let's clarify. An increase of 3.66. It was right here, September 15, 2027 . We have now moved the maximum for this hike cycle all the way to December 2027. But now we have fully factored in four interest rate hikes. That means as of this morning we have factored in over four interest rate hikes over the entire cycle, starting in September, right?
We already have one promotion . We now have a total of 5,093 rate increases accounted for this cycle. This is the trade in pain. Pain trading , which involves sacred chickens. If the economy, and you'll notice that all of this was against the backdrop of today's blistering PMI numbers that we looked at this morning.
We are not going to retell them. Pay attention. It was so important. I even sent a little love letter to Sarah Eisen, because you may remember that this morning I complained that Sarah Eisen was ignoring the data that was prompting the Federal Reserve to hike. And maybe someone should let her know about it.
So I published a little letter, and I said an open letter to Sarah Eisen about the economy. You can read it on X at Real Me Kevin. But the point is that the markets are really pricing in further increases now. And unfortunately, if we don't reach an agreement soon, which I still insist on , we will.
I just want to be crystal clear and consistent about this. Okay, sometimes people say, "Oh, but the headlines make it seem like you're changing your mind." People who watch know that I have been extremely consistent. I bought on the decline. I will say that it makes me buy on the decline a little slower.
That doesn't mean I'm not interested in buying on the dip. That doesn't mean I think we're heading into a recession. That doesn't mean, you know, I think the market is going to crash. This means that between now and the announcement of the Iran deal, markets will be accustomed to four to five rate hikes during this cycle.
Not what I said. I said they count four. I think we'll get two. After today's GDP data and just looking at some of the other financial data that came out, we're probably going to be closer to four unless we get this deal with Iran, which is still my base case, so I want to buy. But if we don't get a deal with Iran, my friend, it's going to be a painful deal .
That's why we're seeing US Treasury yields rise sharply. You can see it right here. Uh, uh, the 10-year Treasury yield literally looks like a meme chart. Today we reached a session high of 5.13. This is the highest figure since July 2007. And the fact that we grew by 15 basis points during the session is just incredible.
This is the biggest one-day jump in 10 years since the week of the release. Yes, that's how bad today's shock was. Today's shock was as bad in the Treasury bond market as the one we saw when we were fired. And no one liked being fired when that happened. It was madness. It took us a few weeks to think, "Wait, wait , wait, wait.
This could actually be a buying opportunity." It took everyone a few weeks. And we just experienced the same shock. It doesn't feel like it because we're so close to all-time highs, but we've literally experienced so much shock in one day, it's just crazy. And then, you know, just for context, in October 2023, the 10- year bond yield touched 5% intraday.
And then we grew up and immediately moved away from it. We literally just went from 4.95 to 5.11. It's like a store advertisement. In one session. This is just madness. In two years, the highest figure since mid- 2000, five-year bonds surpassed the 5% mark for the first time since 2007, 30-year bonds are at 5.4%.
If you want to invest your money risk-free in Treasury bonds now, you can earn a 5.4% risk-free return every year for 30 years. This is mortgage time. Holy God. Well, that's pretty impressive. So, this has also pushed up global markets, for example, UK bonds are now at 5.31. This is the highest level we have seen since 2011.
The dollar is actually back to 101 now, the first time we've seen such a high since July 30th. So, it's clear that this was caused by hot PMIs. This is not a stagflationary concern, unless of course, and this is where we just need to be clear about what's going on. Could there be concerns about stagflation?
Yes. If this war goes on forever and Donald Trump imposes tariffs on China after Xi Jinping leaves, then we will have problems. Because there is talk of Donald Trump imposing tariffs on India and China to force them to pressure Iran to stop the war. If they withstand the pressure and we don't renew tariffs with China, and at the same time the war drags on, then we'll be back to 1970s-style inflationary [ __ ].
It's time to move down. I'm not saying this is my opinion. I say it's a risk factor. Now, the five-year, the five-year, which I always find so difficult to explain, the name of this is a little lame, but basically, what the markets think inflation will be in five years, which is 2031, and then another five years.
This graph. Basically, no movement. Okay, we did absolutely nothing. We're sitting right here and at the right mid-range . Sure, you could draw a few lines here and continue with a net upward trend, but it's not like we're breaking through or anything weird is happening. So, inflation expectations at the long-term end are not of particular concern.
If I move to a 5-year perspective, we are already far from the peak we were at when the war started. And we're actually close to where we were in 2025, where we were for most of 2023, maybe a little higher. So, the market is not screaming that there is a stagflation problem or that the Fed is lagging behind here.
The market is screaming that GDP is higher, the war is still going on, and the Fed is going to raise rates because the labor market is improving and they need to make sure those inflation expectations stay anchored. Which, I mean, we talked about this this morning. So I don't want to seem ridiculously redundant.
I'll just briefly remind you of that. This ADP, Warsh change happened right here when we were going down. It was then that he took the initiative. We needed to find the bottom. We found the bottom. We have reached rock bottom. And now we are rapidly emerging from the bottom of the labor market, according to a private report from ADP.
This does not mean that everyone can easily find a job. It simply means that overall the economy seems to be thriving. And if you compare that to the flash PMI readings we got this morning, wow, it looks like we might deserve a whole percentage point increase in interest rates. That would be four raises, which is unthinkable.
Of course, there is always a chance that we actually get a nuclear deal with Iran, but I will say that the betting markets do not indicate that those chances are even remotely close. Holy God. I'll show you them in a moment. Quick note: Kalshi is currently a paid sponsor of Reinvest, my startup. So, it's a win for our startup, it's a win for investors, and it's a win for people looking for a little extra income to sign up for Kalshi and join the betting markets.
You can use the “Meet Kevin” feature during signup and get a free $25 after signing up and making your first transaction. You can scan this QR code here or simply go to kalshi.com/r/meetkevin. It's kind of like Reddit, the way they did it with the slash r. But anyway, take a look at Kalshi here. Nuclear deal with Iran.
So you can see that the chances of a nuclear deal with Iran have increased on the right side of this graph. But what's really depressing about this graph is that the blue and green lines are the Iran nuclear deal until March 1, 2027, and in... The Iran nuclear deal . Oh, sorry. This is the orange line.
The orange line is the one at the very bottom. It's just an 11% chance that has n't really changed. The blue and green lines show a probability of 35 to 39%. So, in reality, the cumulative chance is 35 and 39 out of 74% that we will get a nuclear deal with Iran by January 2029. Namely, the inauguration will take place on January 20, which is very interesting, because do you remember the whole hostage crisis in Iran?
It ended literally on the day of the inauguration of the next president. They did not want to give the incumbent president a victory at all. They intentionally held the hostages longer to make sure the deal wouldn't be done until a new president took office, so the new president could declare victory and they could try to start a relationship with that president, not the one they had problems with.
So, this is a bearish trend, okay? Bearish, bearish, bearish. Regarding this, I'm curious to know one thing : I'm a big fan of watching these posts to keep track of the odds on the deals, what the odds are for the Federal Reserve, and I'll probably play around with the Fed bets a little bit. This came about because 2 weeks ago, before going to Halloween Horror Nights, another YouTuber approached me and asked, “ Kevin, what do you think the chances are that the Fed will raise rates?” "And I said, 'Oh, 11 by 12.'" This is the payoff I'm expecting.
I think in 11 out of 12 scenarios they will raise the rate, which is about 8% or whatever it is. And they say, “Well, the increase is only considered at the 75% level, which is one in four, uh, that it won’t happen . In other words, your expected value is, uh , over 17% on this delta. And I am like that, damn it .
When I'm really that confident, and I, you know, I even put Grant Cardon on a high level. When I'm so sure, maybe I should put a few dollars in the betting market. I love things like this, simply because I feel like the Fed is actually signaling very well. And sometimes I think people just take the opposite bet as the opposite, or they say stupid things like Grant Cardon, but that's unnecessary.
Uh, look at this. The Fed's decision in October, I keep emphasizing that there is a chance that they will actually cut rates. This will not happen. But the Fed's decision, this year, the Fed's decision in October, has a 66% chance of a 25 basis point hike. It's ...uh, actually up 50% in just the last 12 hours.
But there is now a 2% chance of a hike of more than 25 basis points , which actually starts to factor in multiple rate hikes in October. What, I understand. But this is not the peak of fear for the stock market. This is turning into a peak of fear for the Treasury and bond market. This is strange. Part of that is because Brent is back up to 103.
WTI is at 92. We were doing so well. Everything was going so great. And then of course you get hits on some ships in the sea lanes when we're hoping for a deal and we have n't heard anything about a deal yet, and it's kind of like, "Oh, that's annoying." "Oh, well. At this point, we are in a situation where all of Scott Bessent's bond buyback operations have effectively failed.
On August 19, the Treasury Department said it would double the volume of long-term bond purchases from $2 billion to $4 billion per transaction. And yields were indeed pushed down that day because they were trying to push down the 10- year yield so that mortgage rates would be lower and affordability would increase ed.
The market literally showed Besson two middle fingers. This is pretty bad. On September 1st, the 30- year bond went back to 5.27, which essentially wiped out all those gains, and now we're at 5.4, which is just crazy. Uh, you know , then on September 9th they tried to increase financial aid again. It didn't work.
Then on September 10th they came out and actually bought 5.19 billion, and people thought they would buy a lot more, closer to 8-10 billion." And then the profitability actually increased after their financial assistance. 10-year bonds rose to around 4.95 after the bailout. So they got involved. They have no control over this market.
And I think they realize that. So much so that even Donald Trump has changed his tune at this point from, "Oh, well, Fed Chairman Jerome Powell just wants to raise rates because he's a politician, and so he doesn't want to lower rates because he doesn't like me." “Now you literally have a person appointed by Donald Trump, Kevin Warsh, who is raising the stakes, and he will probably raise the stakes.
I mean, if the war doesn't end, we'll get four raises, three or four. This is terrible. This will be...We'll talk a little more about how this will impact profits and companies in a moment. Uh, if the war ends, we can calm down very quickly, we can turn around very quickly and buy the dip, which will really be rewarded.
I still think it's possible within the next week. "Uh, nevertheless, you know, now the Trump administration has changed its position, and they are arguing." Oh, well, you know, Vorsh just has a very hostile board of directors. It's everyone else on the board of directors who are just hostile . And that's why they had to raise the stakes.
Dude, this guy is so good at marketing that he doesn't even realize when he's just lying. OK? And you know me, I'm Mr. Apolitical. I'm going to put my Kevin on the ballot. I vote for myself. It's because I ran for governor and lost. This makes me a loser, but maybe I'm a loser who denies everything and keeps voting for myself.
Although I'm not even running for president and I don't have the right to run . This means that in my ...How old do you have to be to run for president? Like ...and me, you know, I was born in Germany anyway, so I'm at a disadvantage in that regard. But how is it not 35 to be president? I think it's 35 or 36.
35. Wow, I'm going to be 35 next...I'm going to be 35 in January. Uh, but anyway , you know, you're sitting in a situation where there's really no control here, and that's exactly what the Federal Reserve wants. They don't want to appear political. This is how they maintain stability in inflation expectations.
This is how we avoid turning all this stupid Iranian nonsense into a real stagflationary disaster, which it would be if we did n't actually have a Federal Reserve in our pants. If we had a Federal Reserve that indulged Donald Trump's every whim, we would have an Arthur Burns scenario where we would have to take Paul Volcker and then essentially trigger a double-dip recession.
I'm not predicting this. I'm not worried about it at all right now , but obviously I'm monitoring the data every day. No signs that we are heading for a recession. However, there is a problem for the market right now , and it is called " trading pain." You get over 5% risk-free return. In other words, you can just put your money even in five-year Treasury bonds and with zero risk earn, you know, over 5%, you start competing for that basic rate of return that pension funds or insurers need, where they take some of their allocated capital or free bonds, insurance free bonds, say, you know what, what the hell, I'm just going to go buy Treasury bonds at 5%, because we're just going to hold them for five years until maturity .
Of course, it's a small bet that inflation will come down, which we think is true, that it will eventually happen, but it certainly can't happen when, you know, the war is escalating. The war needs to improve. We already know that. We already did our update on Iran, so I don't want to repeat all of that.
But here you need to think about an empirical rule. Every 100 basis points on the 10- year bond roughly halves the price/earnings ratio. In other words, if we previously had 4% on the 10-year bond, and now we have 10%, how do we multiply that? Let's just give an example, okay? So why don't we take Apple stock as an example, okay?
I'm a bit of a bullish on Apple stock. Sorry. I'm also a Meta brat. Eh, big fan. I also made a video about both stocks, especially Meta before its launch, and even, um, even Apple. You know, 15...No, actually more like 20 points ago. I mean, I recently made a video where I say, buy Apple, and the stock went up 20 points.
But anyway, let's quickly analyze how this might work from the perspective of Apple's multi-faceted revaluation. So, Apple is currently trading at $337. Their projected profit for the end of the year, so this is a forecast for the future. In fact, the end of their fiscal year is in a week. So, the current price- to-earnings ratio is 8.82.
OK? If we divide this, we get 337 divided by 8.82. We're currently trading at... This is an inflated number, but we're currently trading at about 38x. If we subtract a multiple of two from this , we get 36*2...Oops, sorry. 36*em 8.82. Let's go. You're about 317. So, that's about where I made my last video about Apple stock.
This was just my last one. This is what it looks like for stocks. Now, in percentage terms, 317 divided by 337, that's about a 6% drop. Now, if I translate that another way, dividing by 317, it's still 6.3%. So that works out to about a 6% drop for stocks that have a multiple like Apple. You can perform this calculation for any company, but this is just an example.
When you go from 4% in the 10-year market to 5% in the 10-year market, you are potentially losing out on annual price appreciation. You know, typical long-term averages for S&P 500 stocks are somewhere around 7%, plus reinvested dividends get you closer to 9% compounded over the long term. 6% is pretty close to these seven.
So, this shows that it is this push that is squeezing the multipliers down . And so maybe that's why a company like Nvidia is just struggling. We lost 227 again. This is another warning signal for us. We definitely nailed the lines, which I'm grateful for, but you know, let's not get too cocky . Let's be realistic about what's happening .
Let's mark Nvidia in orange , especially since we're running out of space. So 225 is Nvidia stock, and I'm looking at 937. Okay, Nvidia 225/9.37 is trading at about 24x. Okay, if I multiply them by 22, okay , 22 times 9.37, that 's about 206. Okay, so 206/225, which is where we are now. Oh, that's an 8.4% drop.
So the situation is actually getting worse. The impact is amplified as you move to stocks with lower P /E ratios. So you get stocks that are closer to the value chain, which, you know, might be ...Well, I mean, I think Apple is a great example. This likely means that the impact on a company like Tesla or Palantir, which trade at 80-100 times earnings, will actually be less of a problem because they are expected to grow faster.
So you kind of absorb these higher rates. But for a more mature company, perhaps like Nvidia or Apple, that double P/E increase matters. So it matters more for companies that have a lower P/E ratio. So in a yield-boosting mode, stocks with lower P/E ratios, theoretically, underperform stocks with higher P/E ratios, which we usually think about, "Oh, I want to buy them at a lower P/E ratio." It all comes down to growth.
That's why we use price- earnings ratios in this channel. So, for fun, just because I have Nvidia here, if I take Nvidia, um, as a multiple right now of 22, that's, um, well, the current multiple that they have is 24. So if I take 24 and divide it by Nvidia's approximate growth, I think it's going to be about 35%.
That's how you take it. Yes, that's how you get a PEG ratio of about 0.7. Just to make it clear how PEG ratios differ, I don't want to go into that. But that's only part of what, for example, AMD does. That's why this morning in the live broadcast to our course participants I said, "Hey, selling call options could be interesting here at AMD." You know, they're up about 10% today if someone actually sold the call options.
Uh, and you can go 86 days and get about an 11% return plus, you know, whatever the underlying asset just changed. But what's interesting about PEG ratios is that AMD trades at about a PEG of two. And Nvidia shares are trading at 0.7. So , you know, there's a slight difference in assessment here. The fact is that all stocks deal with this burden.
It's just another piece of baggage on the back of the stock. Fortunately, earnings are going very well and hopefully they will continue to perform well . The risk, obviously, is that we will start missing out. And that's where, if you look at the Citigroup bank earnings review index, you've started to fluctuate over the last four to five months.
In fact, in the last three months you've had four crossovers between positive and negative views. So, you had it in July, you had it in early September, you had it in late September. Uh -uh , it fluctuated, which suggests that analysts are starting to raise their discount rates because of the interest rate hikes that are happening here, which means people are thinking, "Oh no, these earnings are going to be less valuable because rates are going up." This is how it all begins.
So those are red flags when, you know, we start to wonder, "[ __ ], are profits going to suffer because of this higher yield?" We don't know. We'll see. But it usually increases the cost of capital. Look, you know, for the borrowing companies, it certainly increases the cost of capital. But even the discount rate that companies assign , and this is mechanically why this happens, you know, if the risk-free rate is higher, you take your discount rate based on the net present value and you raise the discount rate, which lowers what you're willing to pay.
This is just another practical way to look at it. I know these were very similar corporate finance terms, and I apologize for that . The bottom line is that higher rates mean bad things for the nobodies. It's usually pretty simple. Unless there is some hidden economic disadvantage. Uh, you know, like , the economy is turning around or something.
Then there are other factors to consider . But, uh, here's an interesting side note: Coreweave just raised another $1.1 billion, which doesn't surprise me at all, because when we last looked at their balance sheet, they were about a billion dollars short of being able to pay the rest of their bills for the year.
So what a surprise – the placement of $1.1 billion in junk bonds. The 5- year bonds were priced at a discount of 98.5 cents on the dollar and ultimately yielded 9.25. This is 2.7 percentage points higher than the average return for similar cloud services. Although, I will say, it seems to me that this is a little better than the 10% that we saw not so long ago.
So, strangely enough , they are still raising money at a very high rate, but it has actually come down a little from 10%. This is pretty wild. So, strangely enough , people are now a little more confident that Core Weave will be able to pay their bills. Sorry. But all this hurts. This puts pressure on the market.
There is no doubt about that. And so it reinforces the need for us to make a deal on Iran, and I actually think Scott Bessant is going to call Donald Trump and say, " Bro, what the hell have you done ?" " Please make a deal, otherwise not only will we lose the midterm elections, but we will be blown up so much that we will cry." I mean, look what Ro Hanna just tweeted.
I mean, they're already starting their advertising for the next presidential election. Pay attention, Ro Hannah. Oh, Ro Hanna is signed to me. Is this a scam? Ro Hanna is following you. Well, it looks like this is his account. Okay, I think he's signed up for me. Five things Democrats will do in January when we regain control of the House of Representatives.
Oh, look at that confidence. I like these green check marks. Was he watching? He was watching my channel. That's why he's subscribed to me. He stole my green checkmarks. Next thing you know, it's a yellow halo emoji. What a double H E is going for... raise the minimum wage, enact paid family leave, end the war in Iran.
I mean, theoretically, if the Democrats win , they might have the right to stop it, but Donald Trump would just veto it. So, Donald Trump will veto this. And then you would need a sufficient majority to gain the support of Donald Trump. I mean, it's possible. If this nonsense continues where profitability goes, the Democrats may gain a sufficient majority.
They could potentially do this by giving Donny T the middle finger and saying, " Now we have balls." We have a supermajority and we actually rule over your double A. “It is possible. It is highly unlikely that they will get a supermajority. Uh, I want to quickly Google this. Supermajority calculations.
Let's just move on to the video sponsor. Why not? Uh, I wonder if they have No, we just have, which party wins the U.S. Senate, which party is No, no, no, no. This would be an interesting survey. They should honestly consider running for office. Hey, what do you think about the Democrats actually getting a supermajority?
That would be madness. You know, another crazy thing is, remember, everyone was panicking about these ballots being delivered in the Los Angeles mayoral election ? Well, apparently now you're actually predicting that Nithya Raman will win in Los Angeles against Karen Bass. Remember when we saw, you know, this moment of retreat from Los Angeles and things like that , and suddenly a lot of the ballots were for Nita and not for Spencer Pratt, and there was a lot of drama around that.
Well, now all of a sudden we have a 57% chance on Kalsha that Nitya will replace Karen Bass. Dude, Los Angeles is something different. I'm actually joking, but I'm also serious that I'm flying over Los Angeles and I won't invest there. I invest north of Los Angeles, I invest south of Los Angeles, I invest east of Los Angeles, and I do n't really have any land to buy west of Los Angeles, because it's all the Pacific Ocean, all the way to Hawaii, and it has its own problems. But, damn it , if you like .
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