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well folks bad news we might officially be in a recession we need to talk about why in this video we need to talk about when markets bottom in this video because there's a lot of information out there and you kind of got to pick which side to follow on this one and we're going to talk about how to prepare yourself in all this first things first you probably already heard about the job numbers this morning I don't want to reiterate the nonsense what matters most is that this jobs report was 2.6 standard deviations off expectation which has now triggered the S rule the S rule being triggered is a recessionary indicator the St Louis Federal Reserve they literally call it the realtime Som rule recession indicator once it crosses over 0.5 boom you might already be in a recession in fact when you go back here and you look 1960s boom you're in a recession when it crossed 0.5 over here boom 70 you're in a recession when it crossed 0.5 over here didn't cross 05 no recession over here cross5 recession over here hit 05 didn't exceed 0.5 no recession over here uh you uh pass5 recession pass5 recession what do you have over here 33 no recession no recession p05 recession get where I'm going with this right every time it goes over 05 recession look at where it is right now now it's not a hard and fast does not mean with certainty that we are in a recession but it is quite likely that we have just entered a recession some people are going to say oh but Kevin it was the hurricane it's the hurricane that's why the job numbers came in low okay then what's now though important to know is that if we are in a recession when does the market bottom that's the big question according to Bloomberg if you average all of these prior recession indicators the market bottoms when the Su rule triggers oh my gosh that means right now buy the dip hold on not so fast I like to look at 2000 and 2008 I take out covid and I wanted to see what happened when the S rule was triggered at these levels because in my opinion they much more associate with not a run-of A- Mill recession but rather an insane bubble of some form the.com bubble the housing bubble and now the AI bubble okay I'm gonna say it do I do I think there's an AI bubble yes I've been complaining about this for a very long time now and what I found when the PSM rule was triggered here was very different from what Bloomberg said and that's my goal on this channel is to always provide you perspective that at least challenges some of the mainstream perspectives out there so you get different perspectives so you can you can ask yourself do I agree with Kevin or do I agree with Bloomberg work I'm going to give you both sides and then you can decide you don't have to pick my side now we did very well in the last I mean frankly today today did very well yesterday I was dumb I had some AMD calls I got burned on that we already talked about getting burned yesterday but I made more than that burnage back today because my shorts made some really nice dollar hollas uh I threw it in an ibkr order the ibkr order doubled my account on ibkr I rarely trade on there my Robin account I doubled this week because I threw puts in there as well I rarely trade in there as well and then my p&l for today is glorious 203 so I mean you could see this this is you know $400 $450,000 in in tendies just in the last 24 hours because I have been bearish since July 11th I didn't play it perfectly over the last three weeks but if you want all my Buy sell alerts just to get my perspective and my discussions in the course member live streams remember we did extend the coupon code to the end of the day today we wanted to get through the jobs Catalyst some people were asking about getting through the jobs Catalyst here it is so meetkevin.com to join you pay once you're in Forever price guaranteed to be the lowest you can ever get otherwise your money back take a look at this folks June 2001 the S rule triggers write that down June 2001 .53 that's where we sit today now write this down April 2008 to May 2008 Som rule triggers write that down why does that matter because it took a little bit longer for the market to actually bottom out in those Cycles it took 15 to 20 months to bottom out after the S rule triggered in 2001 another asset bubble it took 9 to 10 months to bottom out after the uh 20 8 trigger another asset bubble in other words we could be at the beginning of this sell off now does that mean the Market's going to go straight down absolutely not the market will in my opinion absolutely not go straight down in fact it will just slowly bleed every day you're going to get those people who post oh look Kevin today the stock is up see you were wrong I literally had a financial guy a financial a money man manager when I said why would you go long small caps right now that is the worst thing to own in a recession it literally had a a financial adviser and I won't put him I I don't want to put him up on blast and I'll tell you why two reasons uh I won't put him up on blast but on X at real me Kevin he replies me goes oh okay Kevin I think you're going to be wrong the very next day iwm's like up 1 and a half% small caps he's like uh see Kevin was wrong Tom Lee is right again Tomley is always right now look I'm not here to declare Victory right now but if you look right now so to me it looks like investing in iwm was a bad idea is what it looks like right now and I think frankly it's just getting started because if we are triggering a recession warning the stupidest thing to own are small caps because they're the ones that are going to go bankrupt you would be better off buying the dip on Nvidia which I think is a bubble risk You' be better off buying the dip on Amazon as the next Walmart than you would be buying the dip on the Russell where you're going to have a bunch of bks weighing this sucker down no way Jose anyway as a result of this sort of Tiff the reason I don't want to put that person on blast for you know critiquing me that very next day is because he ended up deleting his post so I couldn't find it again uh and I didn't even say anything I'm not like prancing around trying to declare Victory today I didn't even say anything but all of a sudden I'm like I wonder what Tom Lee's saying today I wasn't even going to say anything was not even going to say anything and this is what I get I got a thank you card in the mail from Tom Lee there it is on on screen right there anyway listen the greed and fear index is something that we need to pay very close attention to folks yesterday we were at 40 39 today we're at 26 this is probably going to keep going why because Market momentum probably has to go below the 125 day moving average and stock price strength needs to move out of extreme greed you need all of this to be fear fear fear we're not there yet the vix say skyrocketed uh Safe Haven demand skyrocketed junk bond yields have skyrocketed we're about to reinert on the yield curve Now understand what that usually signals when the difference between the 2-year and the 10-year goes positive again after having been inverted it usually means you have begun a recession we are currently 9.9 basis points inverted we are in nine basis points spread away from once again triggering a recession with now a second indicator not there yet so far it's just the S rule this is not good now I also want you to remember there's a very very key signal that we saw this morning this morning Jim Kramer was asked are we going into a recession and Jim Kramer said no of course not I'm very nervous JP Morgan City Group are all increasing their odds of a Federal Reserve rate cut Nick T also famously considered Nikki leaks believes that a lot of Institutions are now ramping up their interest rate cut projections and I'd like to tell you something I think they're all wrong these numbers are all going to end up being too low over time now do I think there's a likelihood of us getting a 50 BP in September folks if the market continues to correct the way it is correcting now we are going to get a lot more than a 50 basis point cut the Federal Reserve will declare Victory on inflation and in order to preserve the jobs Market the Federal Reserve will cut rates back first to 2% and then to 0% they will do so rapidly they won't do so based on just today's jobs report in fact they're going to try to exercise restraint and they will wait they will wait wait wait wait until unfortunately it's too late and they'll have no choice but to cut rates back to zero that's when you're going to get a lot of folks who argue oh my gosh this is going to set off a second wave of inflation no it's not because everybody's going to be jobless you're going to have manufacturing Supply chains that are so freaking loose that you can't have inflation because nobody can raise prices even in an environment of low interest rates because nobody will be able to finance anything because a they'll either have lost their jobs or their hours have will have gotten cut or their salary will have getting have gotten sliced I talked about this today in my course member live stream listen I'm not always right in my trades I always make that clear I'm not always right in my trades I do not guarantee that you are going to to make money but what I do every single day is I show up I try my best and I give you perspective and I'm going to give you a little spoiler alert of what I talked about to course members today I said listen if we don't go into recession fantastic but if you ask yourself right now is now the time to buy the Cyber truck is now the time to YOLO all your money on on new clothing an expensive vacation a home addition is now the time to put your family's future at risk or is now the time to be cautious my belief is the time is to be cautious my belief is you should cut your expenses my belief is you should pretend you should go through an exercise with your family right now what are we going to do if one of us loses our jobs what are we going to do if my salary gets cut in half what are we going to do if we both lose our jobs what skill set do we have to get another job what are we going to do those are the exercises to start thinking about now worst case scenario you don't lose your job no recession everything goes back to normal fine big deal you cut expenses you were safe but what happens if you don't pre-plan for that and then you get rugged your boss calls you up and says hey you were making 150k 100K a year 80k a year now you're making 100 or 50 don't like it bye I got 20 other people willing to do the same work for that pck this is a time to cut expenses it is very very very scary uh and look there are going to be green days this Market will not fall off a cliff I think frankly you could go into a 10-month bare Market yikes so you know now people are speculating on okay well what's going to do well in a bar Market well potentially nothing but if I had to guess probably gold if we do go into a recession I hate saying it but probably gold McDonald's I actually think Amazon will be a form of McDonald's like I'd way rather be in Amazon than Nvidia I'll take the AI play on Amazon and I'll take that people are going to try to get the cheapest product possible on Amazon they will be the dollar store you want to invest in because if you invest in the dollar stores they could go bankrupt I I I I'm telling you you come here for the perspective that you didn't even consider jpow will probably commit to rate cuts at jhole he kind of already did but he'll probably recommit to Cuts maybe even 50 at jhole so maybe markets will bounce there they will not go down in a straight line so I think you take your tendies when you can and you reopen positions as you'd like but what I'm looking at is when I look at a company like Amazon I think they are going to be a company that will be the dollar store of the future you go take them right now at a 166 that's actually a fib retracement level 166 divided by 557 they're trading for 29.8 times earnings now you look at their forward growth which could get skewed obviously these growth estimates could get skewed especially if you're in a recession but uh you're looking at growth of 19 + 18 + 26 78 + 13 39 you're looking a growth of 77.9 % over the next 4 years I actually think it'll be greater than that you're sitting at roughly a 1.5 Peg for a company that gives you AI exposure but is not purely part of the AI bubble it didn't run up like all the other AI plays and could be the dollar store of the future and Walmart is sitting at crazy excessive valuations I don't know I prefer Amazon ironically on the dip uh and uh McDonald's on the dip remember my 2x two found Foundation model it's inspired by rust the 2x two says you want to buy companies that do not have a bankruptcy risk to me that kills a lot of dollar stores already a lot of them don't have the strongest balance sheets uh you want uh and Amazon and and McDonald's they're not going to go bankrupt in the cycle I want valuation McDonald's and Amazon mostly have that right now Amazon certainly does McDonald's a little bit richer but I'm okay with it uh sentiment and momentum the sentiment on both of these is trash I like buying when sentiment is trash on those companies and pricing power both of these companies both of these brands have absolute pricing power there is not a doubt in my mind about both of those companies now would I hedge uh by being you know maybe short the cu's or short you know some some AI of course and again we will bounce we had a little bit of a bounce this morning we'll probably bounce again next week but the next four month uh three months going into the election I don't want to be Uber bull I don't want to be an Uber Bull in this environment get me through the election and I'll consider it I'll consider it at that point but not earlier not any earlier than that so I really want folks to think about this not from the perspective of fearmongering we could bounce we could rally again that's okay I'm all right uh you know sitting on the sidelines and uh and enjoying but what I want to know uh you know sort of just just watching cash raise cash you know short to hedge your Longs that's the point really hedging right but what I want to know is when's the market really going to bottom I think the market bottoms either when we confirm a soft Landing which would be a very soft bottom it would be a very blurry bottom a very volatile bottom or when the Federal Reserve freaks out in fullon bailouts there were two cases that has happened pre previously in the past one is when they joined the course member live streams themselves and said we're going to the Moon okay that never happened that was really just a Sly pitch probably relatively weak for me to remind you about the expiring kubon code today one was actually February 10th of 2009 when the Federal Reserve released the following statement the Federal Reserve board on Tuesday announced it is prepared to undertake a substantial expansion of the term asset back Securities loan facility the expansion could increase the size of the to as much as $1 trillion and could broaden eligible C collateral to Encompass other types of newly issued AAA rated asset backed Securities such as commercial ma mortgage back Securities private label real estate mortgage back Securities or other asset backed Securities in other words the massive qe1 that was actually authorized in November of 2008 under the section 133 emergency lending program uh this was announced in November of 20 eight this wasn't enough it took the FED really panicking and going for a level of bailout they've never done before and that's what you got in February of 2009 look at when the stock market bought him February of 2009 how about March when the Federal Reserve or uh February to March of 2009 or 2003 when you had your second double dip and the Federal Reserve basically gave the monetary policy and economic Outlook commitment to Congress that they will stop at nothing to protect this economy in the market bottom that's the kind of fed you need they weren't yapping about a dual Mandate of inflation they've talked about one mandate we'll do whatever man we need to bail this crap out it's like when the FED came out in March of 2020 and said we will buy everything infinite bailout we'll even buy stocks that my friends is when the market bottoms that is when you go shopping I'm just going to keep doing my best I'll be here every day you know I know people make fun of me they call me a flip flum or whatever in volatile times it is challenging to be perfect in fact in any time it's challenging to be perfect and I don't I don't confess to being perfect at all I don't even confess to being good I confess to being some dude on the internet who does his best and will share his perspective with you and if you want that persp persective in the form of course member Liv streams mein.com if you want it in the form of these free videos here you go if you want it in the form of uh uh trade alerts no guarantees we can make money obviously today we had a phenomenal day you know up over 450k it's it was a phenomenal day uh and made up for a stupid decision on AMD you know then you can get those so anyway we'll see you there thank you so very much uh for being here bye the way if you are a course member and you want to get free access to the market live chat so you could chat for free and you don't have to be a green chatter uh you can get a wrench when you join just leave a comment on today's course member live stream and say please wrench me bro I always I will always wrench you we'll see you in the next one thanks folks bye
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