25-Day WARNING: This has NOT Happened since The Great Depression.

Name: 25-Day WARNING: This has NOT Happened since The Great Depression.
Uploaded: 2023-04-26T15:20:37.000Z
Duration: 56 min 39 s

The Reality of Economic Catastrophe

In this section, the speaker discusses the fear-mongering tactics used by mainstream media to instill fear in people and how it affects their investment decisions.

Fear-Mongering Tactics

Mainstream media is peddling fear, uncertainty, and doubt to make people move to cash instead of acquiring assets.

An element of fear hasn't happened since the Great Depression, and if the media has its way, people will run to their friends and family to warn them about economic catastrophe.

First Republic Bank's stock fell from approximately $90 per share all the way down to under $13 per share when Jim Cramer tweeted that First Republic is a very good bank.

Critical Data Sets

A critical data set that investors should be prepared for on Thursday and Friday.

The 25-day warning was from the diesel crisis. Prices might go up a little bit, but it's not really a big deal.

First Republic Bank's Troubles

In this section, the speaker talks about First Republic Bank's troubles and how it could lead to bankruptcy.

First Republic Bank's Troubles

First Republic Bank lost about 40% of its deposits and has ten times more debts than deposits.

The company is considering a $100 billion asset sale so they can sell off notes and securities. However, now they have to be marked to market right.

A lot of folks are worried that this company is next to go bankrupt.

The 25-Day Warning

In this section, the speaker talks about the 25-day warning and what it means.

The 25-Day Warning

The 25-day warning was from the diesel crisis. If we run out of diesel fuel, economic catastrophe is what will happen.

As usual, things just weren't as bad as feared. Prices might go up a little bit, but we're not going to run out of diesel.

Diesel Crisis and Freight Recession

In this section, the speaker discusses the fear of a diesel crisis and how it did not come to fruition. Instead, diesel prices have plummeted due to a freight recession caused by factors such as warmer weather, overstocked warehouses, and inaccurate predictions of freight needs.

Fear of Diesel Crisis

The world was worried about running out of diesel for heating and trucking.

However, diesel prices have plummeted instead.

OPEC+ cut crude oil production which usually sends oil and gas prices up but not this time.

Freight Recession

JB Hunt reported a "freight recession" due to factors such as warmer weather.

Warehouses are overstocked from the pandemic.

Companies have been less accurate in predicting their freight needs.

Trucking companies are failing at a rate of one per week.

Impact on Truckers

Truckers are being affected by the failing trucking companies.

Heart goes out to truckers who have a hard job that requires them to be alone often.

Great Depression Fear-Mongering

In this section, the speaker addresses fear-mongering about an impending Great Depression circulating on social media. They urge viewers to be honest about the situation and not fall prey to sensationalism.

Great Depression Fear-Mongering

There is fear-mongering about an impending Great Depression circulating on social media.

Viewers should be honest about the situation and avoid sensationalism.

The Money Supply and Economic Pain

In this section, the speaker discusses the contraction of the money supply during past economic crises and addresses concerns about a potential economic depression due to current trends in the money supply.

Return to Trend

A normalization process where the money supply returns to its previous level.

Currently, we are above a 2000-2019 level of trend, which means that a negative number is expected.

Base Effects

The chart showing the contraction of the money supply is a percent change chart.

When there is a sudden decrease in printing or circulation of money, it will result in negative numbers.

Expansion of Money Supply

The expansion rate during COVID was unprecedented.

Between 2000 and 2019, as long as the expansion rate was relatively normal, inflation did not occur.

Inflation

Driving at 50 mph while running a money printer at an equal speed does not create inflation.

Rapid changes in expansion rates can lead to rapid disinflation or inflation.

Inflation and Money Printing

The speaker discusses the relationship between money printing and inflation, using historical data to support their argument. They explain that a rapid expansion of the money supply at a rate of growth higher than trend outside of a recession leads to massive inflation.

Money Supply Normalization

It takes about 23 months for inflation to peak after the money printing downtrend begins.

Peak inflation is usually matched with a recession.

A rapid expansion of the money supply at a rate of growth higher than trend outside of a recession leads to massive inflation.

Historical Examples

The speaker compares the current situation to 1982 when there was also a recession and high inflation. However, in 1982, there was no rapid expansion of the money supply.

Rapid acceleration in money printing tends to lead to inflation with an average lag time of about 17-18 months.

GDP Numbers and Inflation Expectations

The speaker discusses upcoming economic indicators that will be released soon, including GDP numbers and inflation expectations. They explain how these indicators can impact the stock market and provide insight into whether or not we may be trending towards a recession.

GDP Numbers

Quarterly GDP growth numbers will be multiplied by four to get an annualized GDP number.

If there is a big miss on GDP, it could indicate that we are heading towards a recession, causing concern in the stock market.

Inflation Expectations

High one-year inflation expectations could de-anchor and cause inflation to rise.

University of Michigan one-year inflation expectations will be released on Friday.

Millennials and Paper Handing

The speaker discusses how millennials are the biggest paper handers and provides insight into why this may be the case.

Millennials and Paper Handing

Millennials are the biggest paper handers.

The speaker suggests that this may be due to a lack of financial education or experience.

The Importance of Timing the Market

In this section, the speaker discusses the importance of timing the market and how missing out on certain days can result in significant losses.

Key Points:

Missing the 10 best days in the market results in having half as much money.

Missing the 20 best days results in a loss of $18,000.

Missing the 30 best days results in a loss of $11,000.

The speaker emphasizes that it's not just about timing the market but also getting back into it at the right time to avoid losses.

Investing Strategies for Millennials

In this section, the speaker talks about his personal experience as a millennial investor and shares his optimism about future economic growth.

Key Points:

The speaker identifies himself as a millennial investor and suggests that surveys may be conducted on "flip-floppers."

Despite being heavily invested, he emphasizes patience and avoiding impulsive decisions.

He expresses excitement about future economic growth and believes in an elongated Nike Swoosh-shaped recovery over the next decade.

Kathy Wood's Concern About 3M

In this section, Elon Musk responds to Kathy Wood's concern about 3M's negative growth and its potential impact on the economy.

Key Points:

Kathy Wood is concerned that 3M's negative growth could indicate an impending recession.

Elon Musk questions whether they are looking at old data or ignoring bad data when analyzing 3M's performance.

Kathy Wood responds that they are ignoring the bad data and that 3M's negative growth is a bad omen for the economy.

Nestle as a Leading Indicator

In this section, the speaker discusses Nestle's pricing strategy and its potential impact on the market.

Key Points:

The speaker questions how Nestle works as a leading indicator compared to 3M.

He expresses concern about Nestle's Q1 price growth being below expectations and suggests it could be an indicator of volatile food categories.

Kathy Wood argues that consumers are reducing volume in response to higher prices, which could backfire on companies like Nestle who prioritize margins over volume.

The speaker revisits the data and finds that real internal growth is negative in many categories despite pricing power, indicating potential issues with temporary inflation and disinflation trends.

Google's Earnings Report and the Importance of AI in Search

In this section, Kevin discusses Google's recent earnings report and the importance of Artificial Intelligence (AI) in search. He highlights that 68.6% of Google's revenue comes from simply Google search and Google Network, which is falling by 8%. He also mentions that Microsoft is taking AI seriously and has rallied because they are talking about multi-billions of dollars of opportunity if they get AI right.

The Problem with Google's Revenue

68.6% of Google's revenue comes from Simply Google search and Google Network.

Falling eight percent, while Google search is only rising two percent.

Suggests that Google needs to take AI more seriously as it could disrupt search.

The Importance of AI in Search

Microsoft is taking AI seriously and has rallied because they are talking about multi-billions of dollars of opportunity if they get AI right.

Suggests that if Google doesn't take AI seriously, their 68.6% revenue will be on the line.

Investing in Yourself to Stay Ahead

In this section, Kevin talks about how important it is to invest in yourself to stay ahead. He suggests taking courses to educate yourself, reading books, being a little bit more efficient every single day, packing your bag better when you travel, etc.

Investing in Yourself

As long as you're alive knock on wood you're healthy and you can invest in yourself to make yourself more productive.

Suggests taking courses to educate yourself, reading books, being a little bit more efficient every single day, packing your bag better when you travel, etc.

Changing Your Mind

Kevin changes his mind when there is a better tool or something that provides better value to the customer, team, himself or his family.

Encourages viewers to do the same and promises to do the same thing with the companies he operates.

Conclusion

In this section, Kevin concludes by thanking viewers for watching and encouraging them to stay strong and invest in themselves.

Final Thoughts

Thanks viewers for watching and encourages them to stay strong and invest in themselves.