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연준 파월 의장 의회 증언 후 금리 인하 기대가 후퇴했다고 해석. 평균물가목표제(FAIT)는 저물가 때문이었다는 점을 지적하며 연준 신뢰를 비판. 뉴욕커뮤니티은행 급락과 상업용 부동산 리스크 언급. GDP 2.5% 상향, ADP 고용 증가로 경기 과열 신호 제시. 연내 금리 인하 횟수는 3회 vs 4회 사이 동전던지기 수준, 3월 FOMC는 인하 가능성 낮음으로 봄.
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well we just had really bad news from the Federal Reserve in three different ways it's not good specifically for a certain Subs sector of the market and it doesn't matter for another Subs sector of the market we're going to talk about all of that in this video but I have to say the things I heard here were not great first I have to start with the greatest disappointment for the last over two years probably closer to three years I've been talking about this subject called fate it was a 2019 proposal that went into effect in 2020 it was the Federal reserve's 4year game plan on how to try to essentially have an average of 2% inflation it's called flexible average inflation targeting well I feel like a knife was thrown through my back today because apparently Fate has nothing to do with actually having flexible average inflation targeting because when Jerome Powell was asked about it in Congress he said well we made that because inflation was low it was a way to Anchor inflation expectations at 2% and keep them from sliding down the pandemic may have changed that in a significant way and we will review this framework at the end of the year and it'll take about a year to review so in other words let me translate to that to English when we said we wanted to Target inflation at 2% with a flexible mindset we only said that because inflation was too low now that inflation is too high we don't care about fate anymore it was just a manipulation it was just a rigging to keep people thinking we cared about 2% inflation well I Feel Like a Knife just went through my freaking back okay I'm a little pissed the FED tells you one thing and then does the opposite you suck you suck and why does it really suck because I thought as we would get to maybe two and a half to 2 and 3/4% inflation the FED would say you know what this is good we had low inflation for the decade before the pandemic we have 2 and a half% afterwards guess what we don't have to changeed the inflation Target to 22% because of Genie out of the bottle fate f fible average inflation targeting it's here to make it all okay and we'll cut rates even though inflation's not at 2% yet because of Fate well by rug pulling us on fake fate fake fate uh and admitting that it was just a lie the Federal Reserve just blatantly told us it is going to take even longer for rates to go down if that's not obvious yet what that means that doesn't necessarily mean we're not going going to get our two or three rate Cuts this year it just means actually getting back to the normalized rates that support interest rate sensitive stocks going to take way longer cuz there's no fate coming to save you maybe that was the Fate all along what an irony the second thing that was a disaster that we heard was drone Powell was asked about stock uh Scott Recker white paper which was previewed in Fortune Magazine calling for quote 500 or more bank failures coming with a doom Loop ahead of us of pain and a quote slow moving train wreck as waves of commercial real estate loans mature over the next few years and an industry that is incapable of solving for that commercial real estate problem this commercial real estate problem is the equivalent of the residential housing problem we saw in the 2008 recession okay drone pow was asked about that drone pow's response was well well we think the commercial real estate sector is manageable everything's manageable here we'll be fine well at the same time as everything is fine what happened with everything is fine New York Community Bank well New York Community Bank decided to come out while I was trading for about $3.14 and decided to say hey we are out of money and our bank is failing so we're going to raise some money on the stock market and the stock market's like oh hell no you are stock down 42% probably honestly halted for the rest of the day at this point so very inconvenient timing for JP's testimony but a reality that we face that we now have two big oopsy dupsies for when it comes to the Federal Reserve number one fate is a lie and number two the banking system is sound and resilient except for some okay number trace okay third one Jerome B uh so uh first one we had here we had fate uh we had New York Community Bank was the next one oh yeah uh and then of course uh throughout most of the testimony here we got a lot of commentary about frankly the the Federal Reserve being asked about basil 3 banking regulation we're not really going to talk much about that because I don't think that matters to normal Americans what matters to normal Americans is what's going to happen with inflation interest rates and quite frankly the reality of the direction of our economy and the Atlanta fed gave us an update this morning rather than GDP continuing to Trend Down Under the weight of interest rates GDP P estimates have once again been revision revised up for q1 2024 we're now sitting at 2.5% up from the 2.1% where we were about a week ago down from the 3% from where we were ahead or for for the prior portions of this quarter and what that signals in conjunction with higher CPI reads for January although those might be one-timers higher job gains from the ADP report this morning for job Changers which is the first time we've seen an increase since August of 2021 the high jobs report that we had in January and the jolts data today coming in roughly at expectations showing really we're not having a layoff recession we're not seeing uh unemployment meaningfully rise we're not seeing unemployment claims meaningfully rise and GDP continues to Boom whether it's because of fiscal spending debt or AI the reality is raid cuts are probably going to get punted now drum Powell did suggest that the December December summary of economic projections looks for three rate Cuts coming in 2024 the problem is he makes it very clear that those projections are old and that they'll be updated on March 20th keep in mind March 20th is the next fed fomc meeting date it's also the date uh that my daughter will have her reattachment surgery which scary uh but anyway we'll be covering the FED live then I'll be going to the hospital so that's on March 20th mark your calendar for that mark your calendar as well for August 8th when the house hack warrants expire June 30th when the house hack fundraise expires learn more at house hack.com 2024 uh and of course June 21st to 23rd for the meet Kevin millionaire Symposium where we're announcing a new speaker this Friday and we've got a whole lot of inspiration for finance real estate and building your wealth over the long run super excited to see you there check it all out at meek kevin.com but what does this actually mean well if we look at the Fed rate monitor and we start adding together what we're actually looking at rate Cuts we know the market is already starting to unpr rate Cuts last year we were sitting at an expectation that markets and the FED uh we going to align with seven rate Cuts in 2024 at this point and time we are sitting at uh let's add that together here quickly we are sitting at a 46 % chance that we are going to get three rate Cuts we are sitting at a four rate cut percentage of let's see here if I add this together four rate Cuts we're sitting at 54% so we're somewhere right there at a coin toss as to whether we're going to get three or four I think unfortunately there's a risk the FED is might the FED might actually Kick the Can down the road a little bit more and why do do I say that well because of the problem number three with the FED yesterday rafhael Bostic suggested there is a chance the Federal Reserve will not start cutting until Q3 and then after they start cutting in Q3 which could be July could be the July 31st meeting right now uh there's a uh 10% chance we have zero cuts by July uh and then there's a 49% chance we have our first cut in July well after the First Rate cut in July we might actually end up pausing at some point within Q3 holding rates higher for longer so these are things that we're really starting to hear loud and clear here from the Federal Reserve and again does that affect interest rate sensitive stocks absolutely it keeps the boot on the back does that affect AI stocks not at all if anything some argue higher interest rates give companies like Microsoft Amazon Apple and Google more cash flow thanks to the amount of cash they have on their balance sheet and and they basically get to buy AI chips with free money from the interest that they're earning on all the cash that they have in other words they're so rich they could just keep spending on on rich people chips crazy anyway uh Jal Powell obviously reiterates his goal of uh uh you know getting to 2% inflation that they'll come out with a plan for bosel 3 whatever basil 3 BOS 3 whatever you want to call it uh he does call uh Housing Services or or suggest that Housing Services might be elevated in inflation because well quite frankly uh we Ed lagging measures of evaluating Housing Services inflation but there's also the risk that you people just don't move and you don't actually realize lower New Market rents which is a downside that could that could potentially keep those Housing Services levels of inflation higher for longer of course the FED is aware of that and I think they try to price that in uh He suggests overall we're on a good path in terms of of the economy that it does not look like we are facing a recession in the short term uh you do have uh Jerome Powell suggesting we need just a bit more evidence so that's bullish right that's somewhat bullish it does say we want some more confidence we want the 12-month data to be good not just the six-month data regarding fed now he says there's been slow adoption and regarding the AI productivity boom he says it's hard to tell what AI is going to do if it's going to replace workers or augment workers but the reality is right now it looks like productivity and the economy are probably trending up which does actually give the Federal Reserve more latitude to not cut as soon so on a bullish side look Dr Powell suggests we just need a bit more to start with rate cuts on a bearish side I kind of think you've got a Fed here that's starting to imply that they might unpr three rate Cuts I think there's a chance they might revise their summary of economic projections for March 20th to show two rate Cuts rather than three now we'll see we have one more data set to go here A big one well we've actually got jobs on Friday and then we've got CPI coming up uh so once these data sets come up I think we'll have a little bit more insight into which way March is going to go but March is going to be a signaling meeting I do not expect rate Cuts in March neither does the market we're looking at just a 4% chance of rate Cuts in March so in other words no rate Cuts in March we would have heard about it today otherwise March 12th is the CPI release day and other than that I have to say uh the economy is doing well so you can't be mad at the economy booming unless of course you're praying for interest rates to fall quickly which ironically would require a recession which would hurt the rest of the economy so that is what we got out of jpow for being live 3 hours and putting together a 10-minute summary feel free to drop a like check out meetkevin.com for not just the courses on building your wealth but also the millionaire Symposium I'm convinced you won't regret it my goal is to make it the best YouTube finance and wealth building event of the year and it'll be in Vegas June 21st to June 23rd
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