Folks I Hope you have your bow and arrows out because we have another apocalypse warning. Pow Pow is running his mouth again. Retail stores are facing one of the worst economic environments in history. Bankruptcy court is heating up to a more than decade.

High Sunshine Princess Michael Burry is out with yet another warning and of course Market Killing job destroying zombies are starting to rise from the dead and look for their next victims. We'll talk about all of this and more. Let's get right to work. Let's go ahead and start with the Pow Pow.

Now this one was a doozy. Markets were all over the place trying to figure out how to react to this today. Powell Said Today, the disinflationary process. The process of getting inflation down has begun.

And it's begun in the goods sector. We expect 2023 to be a year of significant declines in inflation. It's actually our job to make sure that's the case. He said.

my guess is it will take certainly into not just this year but next year to get close down to two percent. So Pow Pow gave no real answer as to when hikes will stop. He was vague, he beat around the bush just like he did last week. But he did at the same time acknowledge that inflation is indeed heading down, which Market originally took positively.

When you get headlines like this everywhere saying that the FED is acknowledging the disinflationary process, it's a clear signal to markets that hey, this is a new chapter. This is a new theme. What worked in the inflationary spiral won't work in this one. The analogy I'd make here is imagine someone is reporting on a war and they are like war is breaking out.

War is worsening. More and more soldiers lives lost. And that's the headlines that you're seeing for 12 to 18 months and then all of a sudden the Generals come out and they say we are turning the tide on this war. We are gaining on the enemy.

Things are looking better. Mucho better, More and more ground is being recovered. Now that doesn't mean that war is not going to go back out of our favor or that a new war isn't starting soon, but it gives people a sigh of relief that this particular enemy we've been hearing about is being subdued. Unfortunately, like I just hinted at, we do have a new war coming soon and Powell will likely be the instigator.

Howell Today indicated point blank exactly what is going to make them stop. With the Raid Hikes quote, If the job situation remains very hot, it may well be the case that we have to do more. He said he's saying here: Point Blank If jobs don't start getting lost soon, we are going to force it to happen. We're going to force them to get lost.

And when do jobs get lost? Well when companies start doing horribly. So basically what he's saying right here is code for: if the economy doesn't die soon, we'll kill it ourselves. We'll get our hands dirty and kill that damn economy ourselves. If you are working in this economy, you are a massive, massive threat to the Fed's inflation goals.

You should be ashamed of yourself. And when he said this, Market started trending red again. Of course they later brushed it off. but this is the Catch-22 that we are in markets right now.

Want to rally on a so-called strong economy and less rate hikes? But a strong economy means more rate hikes. Not less and more rate hikes means more selling off. On the flip side, if the economy is doing badly, that does mean less rate hikes, but also less value for companies which again means more selling off. Now the markets of the last six weeks have been rallying thinking that the economy can walk that thin line between having to raise rates higher and having on economic apocalypse.

And today when the FED came out and started talking about the Hot Jobs Report and all of this, well, the market started leaning towards this direction. But I personally believe this. Thin Line narrative where you're going to walk right in between has some more juice in it I Don't believe in it. but I think that wall Street's gonna believe in it for long enough because Wall Street sees how freaking profitable it is to convince the masses that the future is Peachy that the future is just everybody walking on this very very thin line.

But my tip is to acknowledge the Kool-Aid But do Not drink it. Do Not drink from that Kool-Aid because I see this as a trading opportunity, not the reality, but how long could this last? Well, if stocks are rallying on disinflationary Trends which I believe they are, well, this could last weeks or even several more months. You already have some Traders and strategists saying that the US could be heading into a period of transitory disinflation. Here we go, folks, the disinflation now is transitory.

Sadly, this time the word may actually be right. transitory means a shorter period of disinflation. We are fairly sure we are going to have this info inflation for five to six more months, but are not sure what's happening after that. Who a accomplished Trader and hedge fund manager said via phone call to Bloomberg money will come in from the sidelines, which is what we saw in January and assets won't sell off if the market holds the view that there will be a reasonable long-term period of disinflation.

but I see a 70 likelihood that we are going to have more inflation problems down the road, driven in part by higher energy costs out of Europe. So that's the stick here folks. Money is coming in to buy this downtrending inflation line. but if inflation heats up again five or six months from now or even plateaus, you're going to get another massive dump.

Now personally, I'd actually be a lot more worried about the strength of the economy than about inflation. We may indeed land softly, but I think that we're going to be landing into a wasteland. The Berg of Bloom reported this morning that the retail apocalypse is returning and they had Bed Bath and Beyond in the thumbnail, which by the way, they bed, bath and banked on that offering yesterday. didn't they? well to more retailers are likely to be pushed to the brink in the coming months.

The default rate among Long John created U.S Retailers could reach 12 this year compared to a near Rock Bottom low of 0.2 percent at year end according to Fitch ratings. With 67 billion dollars in outstanding bonds across those firms, about 8 billion dollars is on the line. going from default rates at 0.2 percent to 12, that's like a 60x increase, Folks, those are Armageddon Numbers These retailers Financial models didn't make sense anymore. Their debt loads didn't make sense anymore, and they shouldn't have been functional companies anymore said Craig Gans A bankruptcy lawyer with blah blah blah blah.

A whole slew of these retail companies just can't survive and you'll say Charlie Wait a second. Retail stores were always heading for disaster because of the internets and the Amazonians. Well, it's not just the intranets and the Amazonians putting them out of business folks quote. One of the biggest difficulties facing the firms is that consumers just aren't shopping as much as the stimulus driven spending of the pandemic era.

Runs Out U.S Retail sales fell by the most in year in December recent Department of Commerce data showed. So this is an industry-wide trend of retail sales getting completely destroyed. and the funny thing is that when you give people tons of money, they tend to do what with it while they tend to spend it and businesses do very, very well. But when people no longer have that money to spend, they tend to cut down on spending and businesses do bad.

Strange I Know now bankruptcy court is already heating up to a decade plus High We had a lot of bankruptcies in 2008 to 2010 and then mixed and then you had some during the pandemic, but in 2022 during the beginning of the tightening, you saw a huge a huge surge. Now the bad news is that this trend is worsening. The good news though is that the bankruptcy courts are going to need a heck of a lot more clerks and judges, so this could help create a lot of the jobs that Biden can then go and brag about. Speaking of: Biden The state of the Union is tonight and Biden has already started praising himself over the economy.

The White House tweeted over 12 million jobs have been created. Wages or Up Inflation is down. President Biden is growing the economy from the bottom up and the middle, out and out. the rear end.

Now it's not on you usual for politicians left or right to take insane credit for good stats in the economy and then ignore all the bad stats in the economy. That's politics, and that's marketing. That's just the way that the world works fine. But what's fascinating about this economy is the level of gaslighting that is going on.

Even at the top, 12 million jobs have been created. Yes, But from what context? a massive government-induced lockdown that artificially destroyed tons and tons of jobs. It's easier to recover from an economic lockdown than it is to build jobs organically. And it's easier to create low paying jobs than it is to create good jobs something that isn't covered in the statistic.

Secondly, it says wages are up, but is that misleading? Well, according to the Peterson Institute and many other economic hubs and analysts, wages in most U.S Industries are simply not keeping up with inflation again. When you print tons and tons of money and throw it everywhere, it's easy for wages to go up, but it's a lot harder to get them to outpace inflation, right? Thirdly, inflation is down. This is the third claim here, and this one's really a doozy. Sure, it's down, but it's down from 9.1 percent, 9.1 percent forage decade highs.

It's at 6.5 percent right now. When Biden took office, it was at 1.4 percent. This is why I'm saying context is key. You could say inflation is down, but it's also up massively massively on a four decade.

Trend I'm not saying Biden is responsible for all of the inflation I think that certain stimulus packages that he passed in say March of 2021 didn't help, but I'd argue Powell and Global issues were far more to blame all. I'm saying here is that this is a very, very misleading brag when looking at the context. And lastly, the White House is saying Biden is growing the economy from the bottom up and the middle out. Is this true? Well, MarketWatch just published a Washington Post poll that found that 41 of Americans say they are worse off financially under Biden highest percentage for any president in 37 years.

Only 16 percent say they are better off 16. So I don't know folks. survey says this building up of the economy from the bottom up in Middle out is false and look folks, I get it. Some random intern probably posted this, but these are the points that he's likely going to be talking about tonight and I would say don't believe it Sounds pretty disingenuous to me.

Nothing that you should be bragging about next, bro. He comes out this morning and says this time is different and then he shows a chart of the.com bus downtrend back in the 01 and O2 era. The Federal Funds rate index is in White and the S P 500 Index is in yellow. So what is he trying to say here? Well, he's trying to say what he's always trying to say: we're screwed Sally The Fed was raising rates into 1999 and 2000.

you had five 25 basis point hikes and then a final 50 basis point hike in that time span. But then January 3rd 01, you started getting massive massive rate Cuts. Between January 3rd 01 and December 11th on one, you had 8 50 basis point Cuts in three 25 basis point cuts and this is what the market did during that time, it trended down dramatically. Then you have this period of time around the attacks on September 11th where markets had bottomed out and then rallied aggressively for three months.

But after they rallied aggressively, it still had about 42 percent of downside left before it would ever reach its real bottom. And the way that I'm interpreting this tweet from Brewery is that he's saying here that people have a very, very hard time emotionally accepting that stocks can go up for months and months and you could still be very early on in an overall bear. Trend I look at content on Twitter and Reddit and even YouTube And literally after every two week rally that we've gotten since the sell-off from all-time highs while the vast consensus very very quickly switches to oh no, we must be done selling off now. I Guess everything that said that the stock market would continue to drop was just baseless fun.

And it's like uh, wait a second wait. wait just wait a second. Sally Two weeks or two months or even six months of an uptrend mean nothing about the overall trend. What matters is the underlying drivers of the market, right? And that's what I believe he's trying to say here.

My suggestion to you though, how do you handle this well? Be practical enough to know that you don't know for certain what tomorrow is going to bring. You don't know I don't know your neighbor Susan doesn't know and Sally certainly does it now. So your goal should be not too overly focus on predicting the weather five months from now, but focus on adjusting your sales today to deal with the weather that we have today. Yes, a good sailor scouts out weather conditions and is prepared for future challenges, but he also must put his primary focus on the here and now and the challenges and opportunities that the present brings.

There are tons of different challenges and opportunities that we must be focused on now. we prepare for the future, but we focus on the opportunities in the present and that is all. I'm saying I Think that if you're living in a constant place of fear and uncertainty and trying to guess what's happening tomorrow, that's probably not going to do you much good. But if you're here today and you're like, okay, well I'm going to focus on risk management.

but I'm also going to focus on how can I see opportunity? Well, I Think that's how you're going to perform the best over the long term. Anyways, folks that caps off today's video, make sure to hit that ravishing like button and subscribe. and lastly, quick plug. Our first research report will be coming out on Sunday this week.

So if you want to sign up and get the very very very first one, make sure to go ahead and go to that link down below. They are completely free and if you submit your email down there, you'll never miss a report. And if you don't like them, you can always unsubscribe. But I think you're going to be very, very happy with them, especially if you like the content on the channel.

Anyways, that caps off the video. Have a great one folks!.