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yet the markets are ripping higher today so I think it's kind of what we talked about three weeks ago like the bottom is kind of in for the short term okay welcome back everybody to altcoin daily my name's Austin billionaire investor chamat Pali apatia on a recent episode of the all in podcast is now officially on record that markets have bottomed he expects a rally in November and it's very interesting the clip I'm going to share with you as to his reasoning to why now the November fed meeting is upon us getting the results on November 2nd and depending on what the Federal Reserve does will they continue to be ultra aggressive raising rates will they lighten up will they pivot that will have the most direct effect on you on where the markets go next so I do want to show you a series of data a series of charts and talk about what you should expect but let's start with the reasoning as to why chamath believes markets have bottomed in this clip he'll be looking at the Blue Chips the big Tech as a percentage of the total s p market cap as a whole and he says that capitulation to him has always been when these Blue Chips the Fang stocks Amazon meta Google Microsoft Apple when these Blue Chips lose significant market share compared to the total SMP market cap that's a sign of a bottom to him can you just throw up the big Tech chart because I think like you guys should see this because I think this is very important for Silicon Valley I mean what's incredible on this chart is that you know when when everybody talks about being along the S P 500 it was always really a proxy for being long Amazon Facebook Google Microsoft and Apple and at the peak you know in May of this year it was still you know 25 cents of every single dollar of the S P 500 were these five companies and you know we always said the market bottom will be when the generals quote unquote get shot you know to borrow Fraser and Gavin Baker and it looks like the generals have been shot yeah and what's incredible is this week every single one of those companies other than Apple really reported pretty crappy earnings they got totally taken to the woodshed the percentage of the of these companies as a percentage of the s p is now you know off by 500 basis points it's down to 20 yet the markets are ripping higher today so I think it's kind of what we talked about three weeks ago like the bottom is kind of in for the short term you know so it's really exciting actually to see I think this is the point where you have to now start to get pretty constructive about where things are going because if this stuff could not bring the market down it's hard to see something other than an exogenous event probably some Russia Ukraine event really having a negative impact so to me I'm kind of like I don't know it seems like pretty bullish for me also GDP was 2.6 the reason these Fang stocks dropped so significantly in this last quarter is because their earnings reports just came out and they were all pretty bad they even had pretty poor expectations going into 2023 just letting their investors know that you know we're not in a bull market anymore chamath is making the argument that unless we see some sort of black swan-like event probably involving the war in Ukraine unless something like that happens the worst is probably behind us does not mean that we'll now go into bull market immediately but he is saying what's going to be worse this was the big earnings call people were scared of people were anticipating and it's happened is there any other big event that can now affect the market let's talk about the fed the meeting what to expect in November I do just want to finish this clip of chamoth being very clear that while he does think that we have bottomed for now it does not mean we couldn't potentially see a lower low in 2023 and he does flat out say this is because of the Federal Reserve and just how aggressive they have been and he doesn't think we've seen those effects yet the effects will be lagging of how aggressive this has been the interest rates lagging until 2023 in this final 60 second clip and I do encourage you to check out the full over two hour long episode I will link the full episode Down Below but in this final clip David sacks makes that point about the fed and then chamoth gives his thoughts now things are a little bit better but I still think the huge recession is to come next year because all the interest rate Inc increases we've seen so the FED is you know pedal to the metal on interest rate increases just like they were pedal to the metal on printing money and so first they you know they were too loose and now they're probably being too tight too fast so I think we're headed for a huge recession next year and I think you're seeing that in in the softness of all these forecasts there's a Fed fund right you know that's a pretty high ramp so you think double dip recession what do you think Freeburg chamoth in terms of what 2023 looks like you're sort of saying a bottom is forming I kind of agree with that I think the stock market is going up then it'll go back down because I think what David said is right but for the short term this thing is going up short term up we've generally been positioned for it to go up and uh and at some point we will reverse and position for it to go back down but it's going up so if you hold cryptocurrency finally we may see some life in this market we may see a rally Bitcoin has been stagnant near all year but again it all comes down to the FED it is speculated that the FED is set to deliver another big rate hike in November and this is nothing new from how aggressive they've been moving all year the FED is moving historically fast to tame inflation this is where we are right now I believe the federal funds rate is around 3.25 percent and look at the speed this year compared to 88 94 9904 2015.
this is pretty much near the most aggressive they have ever been so what you should expect as an investor the talk is they're going to raise another 75 basis points that would be the one two three fourth 75 basis point Ultra aggressive rate hike in a row and then maybe they'll start to turn around in December maybe December maybe they'll hold or maybe it'll only be a 0.5 basis point increase but again that's in the future that's in December for November they're probably increasing 75 basis points and why do I say that well headline inflation isn't really going down while core inflation is actually still increasing despite the ultra aggressive rate hikes so just looking at United States headline inflation we can see that middle of the year we did Peak at 9.1 percent while just looking at these last two months August September 8.3 only then to 8.2 the FED wants to see a much more drastic result which they're not seeing as of yet and then looking at core inflation rate even worse last month we had a yearly high for the whole year and then month over month from August to September we continue to Trend up suggesting that the FED will probably think they need to keep their aggressive stance on top of that the rest of the economy unemployment GDP they're always referencing these in their meetings how the economy can take these rate hikes because it is so strong the U.S GDP did accelerate to the positive last quarter at a 2.6 percent Pace increase so while prior to this we did see two consecutive quarters of negative GDP indicating the economy was constricting the numbers from this most recent quarter should give the FED even more confidence that they can can continue being aggressive as well as United States unemployment numbers which they're always referencing near an all-time low showing strength in the labor market which Jerome Powell always likes to bring up so for tomorrow I would expect another 75 basis point increase because that's what they've hinted at and they've been pretty consistent all year on doing what they're saying if they only do a 0.5 percent increase that would be bullish for the market if they go a full one percent increase that would be bearish for the market and I would expect Bitcoin crypto the stock market to act accordingly we are watching we are waiting the minute I get that information I'll make a video I will tweet it out I will let you know first but like always see you tomorrow
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