Folks, I believe that the Us. economy is about to be pushed off a cliff without a parachute. I believe that there are a ton a ton of folks out there in power and elsewhere that want to make you believe that's not the case. I believe they are either aloof or they are actively trying to distract you from the fact that failed policy making over the last couple of years and several decades will result in some of the most insane and painful economic times that we've seen.

I believe that not only you and I will be paying for the failed policies and failed projections and field governance, but that our kids will as well. If you already have kids, their kids will. If they have kids, their kids will. Mark my words, child labor laws will have to be overturned in order to pay the increased costs that we're going to be seeing.

Your grandkids will have no choice but to spend their childhood in Cobalt mines, mining for electric vehicle batteries, simply so that we could pay back the fraudulent Ppp loans that we gave to celebrities who definitely didn't need it. And I'm not somebody that thinks the government wants to hurt people. I think they try to do their best while also trying to stay in power. First and foremost, after seeing lie after lie, an aloofness from the Federal Reserve and the Federal Government, and after seeing the data consistently fail to hide the failures and errors of those in charge, and after seeing the new swarm of layoffs which we covered in yesterday's video along with a lot of other strong symptoms of contraction that we've already started seeing before the Fed has done anything, at least anything meaningful.

Well, with all of this, I have moved from being a panda bear cub to a full-grown grizzly bear. We are sadly on the verge of what I believe will be one of the biggest economic collapses that we've seen in American history. I really hope I'm wrong. I really wish that I had seen this a year ago, But the stacking up of bad policy after bad policy? complete and utter ignorance.

not just from the Federal Government or the Federal Reserve, but also from Wall Street on what is happening to the average everyday consumer that drives the economy. decade after decade of people making decisions from Ivory Towers that have no idea what Main Street looks like, but likes the virtue signal Main Street every chance they get and enact policies that only benefit themselves. Well, we're starting to see exactly what that looks like. And tell me folks, if you think it's pretty, because I don't think it's pretty, this is going to be a very, very painful time.

and it's up to us to stick together, cut through the Bs, and stay informed, because on the other side of this, we can and will come out substantially stronger. Folks, this video is not a coincidence. It comes a day before the next Fed meeting, the next Fomc meeting, and in this video, I'm going to break down why I believe that the Fed is going to have to kick us off the cliff in order to actually solve this issue, and why they may not even know it yet, But the trend is pretty damn obvious. I'm going to present my evidence for this, and if you disagree with me, that's totally fine.

Here, out the data and come to your own conclusion. We don't need any echo chambers. there's enough of those in society. All I ask is that you watch until the end of the video and subscribe if you want to stay informed on these issues as they roll out.

So in the last meeting, the Fed clearly established a trajectory of 50 basis point hikes moving forward in response to stubborn inflationary data at the time. That was the latest uptick from the Fed in terms of aggression. After saying first that inflation was transitory, then that inflation was just taken a bit longer because of supply chains, and then admitting that inflation wasn't transitory and going the 25 basis point high grout, and then admitting that that wasn't enough, and going the 50 basis point hike route, saying that we're going to hikey hike 50 basis points, but that we're going to adjust it back down because we believe that inflation is peaking and when the data backs that up, we're going to go back down. Well, guess what? inflation? It hasn't been peaking.

Unfortunately, it actually looks like we're just starting to hike Mount Everest. In fact, the data suggests that everything is getting worse, not better, worse. the Castration of Purchasers Index or the Cpi has registered more cash trading of purchasing power. The Producer Price Index released this morning showed wholesale prices rose 10.8 percent in May, which is near a record pace.

Some folks said, oh, it doesn't matter for hitting records because some analysts actually thought this would be higher. No folks, this is a disaster. 10.8 price increases 10.8 percent. Unfortunately, based on the current data, it seems that a lot of Americans who are feeling the pain, feeling the pressure in their wallets, and have been waiting for relief not only aren't going to get much relief, but by the time that relief gets here, it's probably going to come in the form of oh, you just lost your job, You just got laid off the inevitable reality of the situation, and it sucks.

and I hate it. But the reality is that the Fed is going to have to take actually decisive action. It's actually going to have to do something in order to bring inflation down. It can't just do these little poofy doofy hikes, this little poofy doofy tightening and expect things to just calm down on their own.

The Fed has basically been responding to inflation by bringing a knife to a nuke fight. We'd have the same inflationary data if Jerome Palace sat on his couch and watched Netflix all day and did absolutely nothing. And hey, God knows Netflix needs. The business and markets know this.

They know that the Fed needs to take actual action, needs to take something that's not poofy doofy, and markets over the last 48 hours have abruptly accepted this, accepted that the Fed has to do something that's not poofy doofy to get inflation down. Based on the new data, The Fed could either give up their fight to tame inflation and watch the Usd stop standing for the U.s dollar and instead stand for U.s disintegration, or they can actually do something about it. So accordingly, market rate hike expectations have moved from 50 basis points to 75 basis points rapidly before this meeting. Whether that's the Fed trying to guide expectations by doing a little leaky leak to the press or market, assuming the inevitable, that's ahead.

The truth is, it doesn't even matter when you're rapidly changing your strategy based on brand new data that just came out a couple days before your damn meeting, you're clearly in reactionary mode. You're simply not prepared. Go ahead and watch Jerome Powell's conference tomorrow and ask yourself, does he sound like he's reacting to the current day data or preparing for worsening data he's going to say. Oh, we looked at the data and it suggests that we have to go more aggressive with the high key high keys.

But here's the problem and I get it. I've been wrong on inflation, too. If you've watched me for a while, there's been many times I've been wrong on inflation, but I'm not running the Federal Reserve. If you're not raising rates until you have no other choice, you're behind the curve, not ahead of it.

You're not preparing to stop inflation to stop increasing inflation. You're saying, oh, well. if inflation comes, we're going to have to raise rates a little bit faster. You could play that game a little bit in the beginning, but at this point it's too late in the process.

You're basically letting inflation dictate what you're doing and not actually trying to get ahead of it. The Fed needs to grab inflation by the neck and say no, I'm your daddy. It's not the other way around. We've seen this happen again and again, time after time.

The Fed has been behind the curve on inflation. again. fine the first couple times, but when you're this late in the process, it's obvious it's obvious that inflation needs to be dealt with in a completely different manner. Now, we're in the situation where the next ring of this is.

Oh, we're gonna get to a 75 basis point hike. That's the next shock factor that would have been great two or three meetings ago That would have really shocked the market. but now that's just what the market's expecting right now. Futures show a 96 probability that the Fed goes with a 75 basis point hike Tomorrow it shows a 88 probability that the Fed goes with a 75 basis point hike in July.

Unfortunately, Now, if they go forward with that, the Fed is once again reacting to inflation not being proactive. Which means the next meeting, you're going to get into another situation where, oh, the inflationary data is even hotter and now we once again have to go and raise rates to a point that the market's expecting and inflation is ready to handle. And we're going to be in the same exact situation. And the Feds once again got to say okay, we're just going to raise it a little bit.

I get why they don't want to raise it a lot. It's going to hurt a lot of people, but eventually this is going to collapse in a massive, massive, massive way and it's going to be so much worse. It's like trying to stop a snowball as it's going downhill and you're like, yeah, let's put a little bit of effort into stopping the snowball as it's really, really small and then it just keeps getting bigger and bigger and you're like, okay, well, now we should probably stop it, but now nothing works. You have to really blow it up in order to stop it.

The policy trajectory that we are currently on, folks is basically the Fed saying, okay, You know what? We secretly still think inflation is transitory and is going to go away on its own. So that's why we're only doing these foofy doofy little rate hikes. We want people to stop yelling at us. We want people to think that we're trying to do something, but we still think our analysis is right.

It's just taking longer to be right. But we're getting to the situation. With these latest reports that the Fed has to has to acknowledge soon that this is a much bigger problem than they had originally thought had thought a month ago, and are probably faking. At tomorrow's meeting, they need to come out and say, okay, this sucks, It's terrible, but we have to do the responsible thing here.

But I don't think the Fed is going to do that. I don't think they have the balls to do that. I think they're going to go and they're going to play with the trend that they've been playing on. Inflation goes up.

They say, oh, inflation, I'll do whatever you want, I'll react to you, but I won't go a little bit too high. I won't go a little too hiki hiki on you. Just enough. just enough to make sure that people know that we're reacting and not being proactive and then it's going to go up again.

They're like oh my God Thank you Inflation! Thank you for giving me another opportunity to hikey hike. But I'm not going to hike enough to really kill you. I'm just going to hike a little bit so that it kills the American consumer, creates a stagflationary environment, kills economic growth, of course, but also makes it so that this whole process has to drag out as long as possible. and then inevitably, we have to do much, much worse because it's just getting better and badder and better.

or I should say more and more bad. My conclusion is that at the end of the day, the Fed is going to have to decide to rug pull us. It's just a question of when when the Fed finally decides that it's time and the longer they wait, the harder it's going to be. The way that our system works is that we allow constant cycles of boom and bust periods.

The boom cycles fuel innovation, risk taking, euphoria, employment growth. The bus cycles clear out the crud, get rid of inefficiencies, and create a darwin survival of the fittest environment, which makes everything more efficient when things go back up. Boom and busts are an unavoidable part of the society that we live in, at least in the current structure, but as human civilizations have developed, they've figured out ways to soften or fake your way out of certain busts and to further fuel booms. We've done that by making the financial system and the way that we transact with one another more and more fictitious, which actually has the inevitable consequence of having symptoms and side effects that don't show up for years in advance, but when they do show up, they're very, very painful.

But they are hard to follow and hard to track what was the root cause of it. For example, our recovery after 2008 was fueled by huge and aggressive stimulus and monetary policy intervention. But when you fix problems with fictitious money and fictitious policies, it doesn't really fix the problem, does it? It just delays the problem or spreads it out. For example, a lot of what we're seeing right now is blamed on policies that were made in the last couple of years and rightfully so.

A lot of it is due to that, and a lot of it's due to supply chains. A lot of it's due to tons of different issues, but it could also be opening pandora's box that leaves us with a lot of the symptoms and side effects from earlier, even earlier monetary policy and fiscal policy intervention stuff that we did back in 2008 to get us through that recovery intervention that we basically got away with because demand was so low in the beginning. Well, all of a sudden when you create a whole nother round of demand, everything just completely falls apart. Perhaps we're not seeing just the impact of the last couple of years of insane intervention, but also maybe decades in the U.s financial system.

everything is fictitious and a huge disaster took the dollar off the gold standard. which means it's basically like a fancy Iou. We've borrowed more money than we can bring in in a currency that we can also at the same time magically create as much of it as we want and charge whatever rate on it that we want, and we've pushed that to the limit expecting no side effects whatsoever. We've also figured out how to control consumer and business behavior by lowering and raising interest rates, and as a result, we've gotten greedy over the last four decades and lowered interest rates consistently decade after decade to lower than what it was the previous.

You've even gone a step further and saying okay, well, not just lower interest rates. We don't just need that for stabilizing the financial system, but we also need to literally buy securities to pump money into the economy and the markets. And of course, we've set people and businesses money to not work. Which I mean to be fair, if you're the government and you're shutting down, people's right to transact in the economy, well, you do got to do something to make up for that.

But still. And I know it's not nice to say, but there are consequences for everything. Every nice program, every nice policy implementation that has a good goal has a cost to it. And if you're not willing to pay the cost, you can't just ignore it and say, oh, it doesn't exist.

You have to either choose not to enact the policy or be willing to pay for it. Otherwise, it's Just going to slap you in the face like a dog. And I'm not talking a golden retriever, but a really, really ugly dog like a bulldog. We've created a financial system which is incredibly fictitious.

All financial systems are, to some extent, right, but we've created one that is incredibly fictitious where you may not even have supply and you're creating insane amounts of demand. And then our leaders ask, why is there inflation I thought printing dollars creates more goods and services. I didn't realize you actually need people making that kind of stuff. Please vote for me.

I'll do better next time. The fact of the matter is that you can fake it until you make it. When it comes down to a fictitious system, one that you could stimulate your way out of pretty much any ailment. But when the ailment is the stimulation itself, you can no longer stimulate yourself out because you're just adding more fuel to the fire.

And what sucks is that a lot of American people are going to be left in the dark. They only have time to focus on making ends meet ends that are going up in price, while their salaries in most cases, aren't going up at the same rate. and by the time that inflation is no longer a problem, they're going to be hit with the inevitable conclusion of oh well, we're going to have to lay you off or oh, we're going to have to cut your hours or we're going to have to call you back When the economy gets a little bit better, with a complicated issue like inflation and the complicated situation that we're in right now, there's a lot of things that you can blame supply chains putin, the Egyptian Pharaohs for bringing up rock costs with those damn pyramids, but never forget who is in charge of the currency and who is in charge of policies to make sure that our currency doesn't turn into literally worthless pieces of garbage. Lots and lots of different things have fueled the flames of inflation, but it is the Federal Government and Federal Reserve who had started the flames, had lit the flames, and are in charge of putting them out when they get too hot, and when they start melting everything and burning the people.

Now, of course, I want to end with something hopeful. or at least as hopeful as I can make it. This is a uniquely bad situation, but it's not a unique situation. We have been dealing with huge, artificially induced boom and bust periods for most of the time that the Federal Reserve has been around.

In fact, all of the time that the Federal Reserve has been around, over the last 100 years, the Fed has acted to start economic boom cycles and then destroy them and then act to restart them again and again. And history shows exactly how this will play out. The Fed will eventually take the right action to nuke the economy just enough. Where inflation starts going down.

The question of how bad the American people are going to be hit by these policies is really an open question, but eventually it's going to be so bad that inflation goes down. At that point, the economy or I should say, what is left of the economy is going to need to be restarted is going to need to be restimulated. So the Fed is going to take its policy trajectory that it's had over the last 50 years 100 plus years actually, and it's going to reverse course and re-stimulate like it's done every single other time that we were in a recession. At that point, a lot of the weakest companies will be gone and we'll be ready for a new rising from the ashes, one where a lot of capital goes into some of the strongest and most exciting companies that are going to be doing the biggest numbers over the next 10 years After that, without a lot of the distraction companies, a lot of the cred companies around the good companies are going to go up a lot more and the people who buy them during the biggest of the fear cycle and are right and didn't just buy companies, they're gonna go bankrupt.

Those people are gonna see huge, huge returns. But of course that boom cycle will also be transitory and then we're gonna be back right here again. Anyways, that gaps off the video folks. If you have any questions, feel free to reach out to us below or join us on or circle.

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