[00:04] Here we go. It is another one of those days. Another one of those days where you get the BLS job numbers coming out in 2 minutes. In 2 minutes, we'll be covering the numbers. Uh so look here. This is a big deal, folks. Uh because
[00:19] this is uh this is not just the uh December jobs report. Uh this is also the revision that we're going to get for October. Uh maybe we'll fill in some of that household data that was missing by making some phone calls and being able
[00:33] to average out data. This is the first 6 week period that the BLS has actually been at work whereas the last jobs report that we had released the uh BLS was only at work for about 2 and 1/2 weeks. So a lot of data was deemed to be
[00:49] weeks. So a lot of data was deemed to be missing. Uh anyway, here we are. We're uh at uh at the first jobs report post shutdown where we have a full set of BLS
[01:01] data. So, we'll not only get revisions for the prior months, which really makes this feel like a three-month jobs report, uh but we'll also get a lot uh We're looking for that labor force participation rate. Is that labor force
[01:15] participation rate. Is that labor force participation rate going to shoot up? Uh if it does, how much is that going to move the unemployment rate? Uh will it trigger the SOM rule? If it weren't for the October shutdown, we would have
[01:29] the October shutdown, we would have triggered the SOM rule in October. Uh and if it weren't for AI, we would have already been in recession. So with all that said, we are about 30 seconds away from the unemployment uh report for
[01:43] December. That's pretty pretty important. Uh expectations right now are for non-farm payrolls to move 70,000 and uh after we get that 70,000 read, we'll um we'll be looking for that unemployment rate. Uh okay, so buckle
[02:01] up, get ready, get your meet Kevin courses over at meet.com, the offer report. And here we go. We're expecting 70,000. Lost [clears throat] my voice a 70,000. Lost [clears throat] my voice a Here we go. And we got 50,000. 50,000
[02:16] and a minus 8,000 revision on the prior the unemployment rate goes down. the unemployment rate goes down. Unemployment rate falls. Uh so we have a Unemployment rate falls. Uh so we have a 4.4% unemployment rate. Uh and uh the
[02:30] 4.4% unemployment rate. Uh and uh the labor force participation rate is stable uh for December. Now remember Jerome Powell likes to take 60,000 uh uh off of these numbers. So when we take 60,000 jobs off of this, we end up
[02:48] [clears throat] oh in that case we'll be [clears throat] oh in that case we'll be at 10 negative 10,000. So um now the unemploy yeah labor force participation is stable as well. Uh so
[03:02] unemployment rate falls though falls to 4.4%. That's down from 4.5%. So that's decent with the labor force the household survey probably had some decent numbers. Uh average hourly
[03:17] earnings month overmonth.3%. I've got let's see here. Yeah, the prior revision minus 8,000. Change in private payrolls minus 8,000. Change in private payrolls were only 37,000 with a -19 revision on
[03:32] the [clears throat] prior. Oh, I hate losing my voice. Anyway, okay. So, let's get into some of the actual details of the BLS report. Let's go see what the market is reacting with. Market is it ticked up a little bit probably because
[03:47] ticked up a little bit probably because you're excited about uh a um a Federal you're excited about uh a um a Federal Reserve rate cut. We've got uh let's get the actual BLS release from the website. And when we get the actual release from
[04:00] the website, I want to see that households report. households make up households report. households make up what data we're going to get out of the um what's it called? The um unemployment rate. So, let's go find out. Okay, here
[04:16] rate. So, let's go find out. Okay, here it is. 50,000. Okay, so 50,000 [clears throat] unemployment rate stayed at 4.4. Little changed in December.
[04:28] BLS, uh let's see here. Unemployment continued to trend up in food services. Our employment continued to trend up in food services, drinking places, healthcare, social assistance, retail trade lost jobs. That's in December.
[04:41] That's surprising. That's the holiday season. Seasonally adjusted household data have been revised. Uh seasonally adjusted estimates were subject to revision in 2021. Unemployment rate, let's see here. Table
[04:55] Unemployment rate, let's see here. Table A. All right, let's go look. funky business here. Uh we got we're going to have revisions uh over here usually as well. Yeah. Here we go. Look at this. October was revised. Oh my
[05:10] at this. October was revised. Oh my gosh. Look at that October revision. gosh. Look at that October revision. 105 to 173. And then November was revised down as well. Everything was kind of worse other
[05:24] than the unemployment rate. So far, everything sort of missed other than the unemployment rate. The unemployment rate coming down was a little bit of a blessing. Participation rate stable. So, that's going to be from the households
[05:37] report. Uh, if we can get their website to load correctly. There we go. [clears throat] Let's see here. Let's see here. Uh, okay. So
[05:54] employed it didn't uh yeah that's a 233 thou or 232,000 move. [clears throat] So move. [clears throat] So oh I hate this. Anyway um 232,000
[06:07] oh I hate this. Anyway um 232,000 move here is huge [clears throat] man. I I get some water or something. I don't know what's going on. It's like my voice is getting worse the more I talk. Hold on. Let's write this down. So,
[06:22] [clears throat] jobs, jobs, jobs, jobs, jobs, jobs, uh, jobs. So, So, okay. Household
[06:38] survey says 232K says 232K from December. So this is boom unemployment rate rate down uh from 4.5% to 4.4%
[06:55] participation stable 50k jobs versus 70k expected stable 50k jobs versus 70k expected non-farm private.
[07:07] non-farm private. [clears throat] Okay, let's go back. Here we go. private added. What was the private read? Let me see here really quick. Private. Private. Private. Why does it
[07:20] do this? Private. Uh, let's see here. It's okay. We'll get it. It's okay. We'll get it. private jobs added were 36K
[07:36] private jobs added were 36K versus I think we were let me see here versus I think we were let me see here 37K versus 70K 75 expected 37K versus 70K 75 expected versus 75K expected minus 19K prior
[07:51] versus 75K expected minus 19K prior and then uh this one right here was and then uh this one right here was minus 8K prior which sucks. Uh, so minus 8K prior which sucks. Uh, so that's all down. And then we did have
[08:06] I mean this should help us push rate cuts honestly, but we did have average hourly earnings stayed stable, which is decent. Average hourly earnings stable at 0.3%. Okay. And then if I look over here, I've
[08:23] got uh let's see, previous month was revised up to 0.2 prior up to 0.2%. prior up to 0.2%. We've got
[08:39] on their bingo board, right? So, I wonder we'll look at the treasuries market in just a second, but the October revision was insane. So, let's write that down as well. Uh, so that's actually pretty big. October revision
[08:56] wild negative 173K from negative 105K. That really affects your three month here. And then November also revised down
[09:11] down uh 8K to 56K. That makes our 3month average. Now, if we chart that out, 3-month average is -173, uh, 56K,
[09:24] uh, 56K, and, uh, then we've got here 50K. So, the 3-month average. Oh, so that's notifative 50. There we go. So, that notifative 50. There we go. So, that October really tanks us though. -1 173
[09:38] October really tanks us though. -1 173 uh, plus 50 + 56 divided by 3. Three-month average here is -22, right? Three-month average at -22K.
[09:50] right? Three-month average at -22K. That aligns three-month average align with Powell's belief with Powell's belief that we're 50K minus 60K
[10:02] that we're 50K minus 60K equals um -10K. So, we're definitely still shrinking here, which isn't great. Uh the drop in the unemployment rate likely shut the door for the Fed rate. Well,
[10:17] via the household survey. Federal Reserve only had like a 14% chance of a rate cut in January. Anyway, it's sitting at 11% now. Okay, let's see sitting at 11% now. Okay, let's see here. Odds of Fed rate cut 13% or sorry,
[10:31] 11.6% now. So, that's fallen.
[10:43] Okay, let's see what else we have. Private payrolls were only 37,000. Manufacturing saw another [clears throat] contraction. Let's go see manufacturing. It's cuz new orders are down so much.
[11:02] Oh, I hate how this glitches out, but whatever. Uh let's see manufacturing. So manufacturing average work week edged down in manufacturing
[11:18] major industries. Uh little change okay establishment data showed establishment data showed let's see here retail trades lost
[11:34] million in 2024. Average monthly gain in 2025 was 49,000. Average monthly gain in 2025 was 49,000. That's interesting. Okay, so let's write That's interesting. Okay, so let's write that down. Average monthly gain in 2025,
[11:48] that down. Average monthly gain in 2025, 49K. We had 584 total, 49K. We had 584 total, down from 2 mil in 2024.
[12:02] in December, 21K. Employment and food services up 27. Social assistance up 17. services up 27. Social assistance up 17. Retail trade down 25K. That's odd to me.
[12:14] Retail trade down 25K. That's odd to me. And warehousing down 19k. That's odd, huh? Yeah. Why Why would you see that in December? Uh December showing
[12:32] uh what do we have? We had 25k down showed uh negative 25k in retail and negative 19k in warehouse others stable. Okay, let's see what else. So
[12:54] three month is still negative. Although that does include October, right? Like if you take out October, you're closer to the average for the year. So I think that's worth noting. Uh if you remove October, you're closer to the
[13:10] annual average of 49K, right? Uh let's see here. Participation rate fell a smidge. Ah, okay. So it's rounded on this page.
[13:23] Oh yeah, the participation rate. Okay, it did come down a tenth. Ah, okay. That could be why participation participation rate
[13:39] to 62.4%. That's a save right there for the unemployment rate. Uh, let's see.
[13:54] December. That's seasonally adjusted, too, right? But the unemployment rate going down was a surprise. Unemployment rate improved suggesting November's jump was down to oneoff Doge
[14:08] deferred registration resignations and data distortions. argument in other words. Okay. So not great for rate cuts. Although Myron's
[14:23] really pushing for rate cuts, you know. Did you see him tweet reply yesterday? people. I really got to get some water. Hold on. [clears throat] Let me show you this. I think this is cool.
[14:53] bookmarked this. I wanted to Oh, no. I replied to him. That's right. I replied to him and that was here. Look at this. This was with yesterday, the real estate update. So, President
[15:06] Trump is launching QE, having Fanny and Freddy buy mortgage bonds. Who needs the shilling for the White House lately. I've noticed. I honestly think she wants I've noticed. I honestly think she wants a job at um at [clears throat] the White
[15:20] a job at um at [clears throat] the White House. Um, so I've I've noticed that like this transition uh with Sarah Eisen, a a lot of Trump shilling. I think she realizes it gets her a lot of likes on X. But anyway, [clears throat]
[15:33] Myin goes, "We're shedding MBS. Unclear what the net effects are. I'm looking forward to seeing some analysis, which is true." It's like, here, hold on a is true." It's like, here, hold on a second. I got to get water,
[15:46] of thing. And the last is of course you know the Fed is accommodating now and they recently added the balance sheet to that uh to the mix in what is essentially QE light. So you know that's a lot of things uh you know pushing
[15:59] economy right now and I um you know I think I think that these forecasts are respect to earnings and all that. I mean, Natasha, new highs in most of the markets. Um, you know, that last GDP print and and the Atlanta Fed where it
[16:13] print and and the Atlanta Fed where it is. Um, should George Clooney be moving? Okay. Sorry. You had to deal with that. Got my little topo chico here. Got my little topo chico here. Like my tool.
[16:30] so much better. I just don't think I'm drinking enough water because I I'm not drinking enough water because I I'm not haven't been drinking coffee.
[16:42] lack of water in the morning. Holy smokes, dude. smokes, dude. Wow. That's terrible. Um, yeah, like I the last few weeks, and I think it's just like catching up to me that I'm not
[16:58] drinking enough water. Great. Anyway, sorry about that. Okay. So, um let's see here. All right. So, let's go look at some of these tables. Part-time.
[17:13] Let's go look at uh the employment status. There are a few that employment status. There are a few that I really want to look at here.
[17:30] unemployed, like the 27 weeks unemployed. Let's see if that updated. Let's see here. Okay. 27 weeks unemployed. Let's take a
[17:45] Okay. 27 weeks unemployed. Let's take a look here. Fred website right now. It's not loading.
[17:57] It's actually kind of funny. There we go. Uh 1910. Okay, that's not like a go. Uh 1910. Okay, that's not like a huge spike. Let me go over here on the huge spike. Let me go over here on the right. It is Oh, wait. Do I even have Do
[18:11] I even have the full data out yet? No, they didn't update December just No, they didn't update December just yet. So, 1910 was the November read. Let's go see if I can get 27 weeks and over.
[18:31] it went up. So that long-term unemployed set of So that long-term unemployed set of people is uh is worsening. So that's worth paying attention to. That's this number right here, which is
[18:46] odd, right? The reason we think this 27-week number is odd, it's like historically it's recessionary, but today everybody's arguing, no man, it's today everybody's arguing, no man, it's it's artificial intelligence, right?
[19:01] it's artificial intelligence, right? So, let's go see here. So, let's go see here. Okay, let's go arrow. Let's go with this.
[19:21] Okay. Uh let's see here. rises here. You know what? Let's lower this size just a smidge on this arrow
[19:36] this size just a smidge on this arrow here. And let's go with Oh, come on. I hate this. I need to go full screen. It's so stupid on these things. So, I can't get my tools. There we go. Ah, that's so much better. Lower
[19:51] this crap to something reasonable. Okay, here we go. So, look at this. The rise in 1970 was towards the end of recession is when you peak out. You peak out at the end of
[20:06] recession, which is really interesting because we're just on that rising phase because we're just on that rising phase right now. The peak out is always always after the recession. So the peak out I'll just point out the
[20:20] peaks right here. The bars are obviously peaks right here. The bars are obviously the recession. there's a single time we didn't have a recession before it, you know, peaked
[20:34] out. And so we're we're not obviously really like it hasn't really gone really like it hasn't really gone vertical yet, but it's just never risen without a recession curing it.
[20:48] without a recession curing it. Only a recession cures this number. So that's interesting to remember. Let's
[21:00] So that's interesting to remember. Let's save that. Okay, then
[21:17] So here now uh up to 1948 December from 1910 November.
[21:30] Not really updated just yet, but that's okay. So that's this chart. And then if I go duration in terms of weeks. Wow.
[21:44] average duration of unemployment is rising. [clears throat] This is the highest we've seen in all of these data sets. It's not great either. Let's write that down.
[22:04] Uh let's go see here. Okay,
[22:19] of unemployment uh as well 11.4 weeks on average. I uh as well 11.4 weeks on average. I think it was 11.4 or 11.1. 11.4. Yeah. and then long-term unemployed
[22:56] two. This is household data. We got the household survey.
[23:08] this just goes a little bit deeper into some of these numbers. Yeah, this is some of these numbers. Yeah, this is where we saw that 232,000 move.
[23:20] revised for the 3-month average. See here, 56K, right? That's what I used for the three-month average. [cough and clears throat]
[23:41] economy, but one that can avoid a recession as long as those are employed recession as long as those are employed keep getting pay raises. suits are saying. Suits are saying the economy is muddling along.
[23:57] economy is muddling along. Yeah. Yeah. Yeah, along. Meanwhile, Meanwhile, hold on.
[24:17] Have you seen this? 5.4% on the ADP or uh the uh Atlanta Fed GDP estimate. Absolutely insane. Absolutely insane. Uh, let's see here.
[24:34] Oh my gosh, what is happening? There we go. So, like it's like from an AI point of view, it's doing more than muddling wrong.
[24:48] Like I don't think anybody looks at that GDP level and says uh
[25:01] obviously obviously the Atlanta Fed uh real GDP level does not seem uh recessionary at all. Uh this is you know obviously uh obviously also heavily AI
[25:16] obviously uh obviously also heavily AI influenced right we know that but none of this none of this is a signal of that cliff that we've been
[25:29] talking about. You know none of this feels like a cliff. Let's see how the feels like a cliff. Let's see how the market's replying or feeling. No cliff market's replying or feeling. No cliff yet. So far so good.
[25:42] yet. So far so good. Let's go see here. Yeah, so the Q's are Let's go see here. Yeah, so the Q's are really happy on this. Loan Depot is up really happy on this. Loan Depot is up 16% on Trump's loan deal.
[25:58] Uh tech is trying to bounce back today a little bit. Interesting. Yeah, Tesla's still kind of near its 433 level. All right. Um, let's go see what else they're saying.
[26:17] [clears throat] let's see here. 50K softer than expected, still 50K softer than expected, still respectable. Household survey solid.
[26:33] negative revision. Goods producing soft at 21K. at 21K. manufacturing 8K. Let's write that down. So [snorts]
[26:45] we'll say um goods producing down uh 21K
[27:00] manufacturing. Oops. We go
[27:15] Okay, mixed bag on macro is what some folks are saying. You've got Mixed bag is right. Five sector shed jobs.
[27:30] Five sector shed jobs. Uh, six grew slightly. Uh, six grew slightly. All right, let's see. Establishment survey details were net negative macro mixed bag.
[27:44] Okay. Data as long as those employed keep getting paid. Yeah, we saw that. So linear rise in the unemployment rate. So for the Fed has to be really focused on the rate, right? That is true.
[27:59] Powell has said they're focused on the rate. Uh Powell has in fairness said they're focused on the rate which just came down.
[28:15] plummeted. Uh so Uh so they are now at 5%. they are now at 5%. So basically not happening.
[28:27] 95% chance of no rate cut. There's only a 28% chance of a rate cut in March. Now, uh 28% chance of rate cut in March. No
[28:40] rate cuts priced in until June 17th, which will be priced in until June 17th, which will be the first meeting of the new Fed chair
[28:54] the first meeting of the new Fed chair expected to be announced this month. expected to be announced this month. Okay.
[29:07] All right. Well, we'll see then. Let's see here. Let's see if Nick Tia said anything. Uh,
[29:30] okay. Three-month average December [clears throat] from initially reported 75 in November.
[29:44] six-month average little changed. This is a good way to picture it. This is a good way to picture it. Just slow down towards zero.
[30:00] today? I think it was just healthcare, right? Let me go see. Do I have B totals? Yeah, le well leisure and hospitality as
[30:12] well though and it was just retail that cut cut because leisure and hospitality gave us 47k. Let's note that.
[30:37] uh healthcare 40k. 40k. Healthcare just keeps banging. Okay. Healthcare just keeps banging. Okay. And
[30:55] suits are quiet. Nick T is not really saying anything else. See if he's
[31:11] narrowly avoided some rule triggering. I mean, by missing October, I mean, by missing October, we're not really close to.5.
[31:23] over here. Yeah, Q's are now 50 basis points. I mean, honestly, I think like points. I mean, honestly, I think like bottom line, it's it's not that bad.
[31:41] "Uh, I was tracking Sarah's comments since mid mid2025. She definitely wants a job at the White House." Oh, yeah. No, she's shilling hard for the White House. I But I mean, like, everybody from Fox News is getting hired, getting big jobs
[31:54] at the White House, so you can't really blame her, you know. market and and see what happened there.
[32:13] richer. The Fed is always protecting the rich. It's amazing. Well, the Fed doesn't know. I mean, that's that's the nature know. I mean, that's that's the nature of our capitalist environment.
[32:26] The Fed doesn't know how to provide money for the poor other than creating a strong economy. Unfortunately, the poor the last benefit in that, right? So, I I'll say that someone else about uh the rich always uh
[32:41] or the Fed always protects the rich. Uh that's just a function of capitalism. Uh, so [clears throat] the Fed cares about a
[32:53] strong economy to create it's sort of like creating conducive soil for jobs. like creating conducive soil for jobs. That's the idea, right? The Fed idea is That's the idea, right? The Fed idea is create a conducive
[33:08] create a conducive uh conducive economy, good soil for jobs to grow in. uh you know poor people don't create jobs um unfortunately uh or you know
[33:24] contribute heavily to GDP. So you have to so you have to uh trickle down from to so you have to uh trickle down from the top to encourage spending [clears throat] and hiring to broaden out economic
[33:40] success. the the opposite strategy the the opposite strategy uh the opposite strategy is uh more of a uh the opposite strategy is uh more of a welfare state which creates the risk of
[33:54] taxing out uh innovation uh or hiring right so it's sort of like you know the Fed obviously can't tax so it's it's tough for the Fed to
[34:08] directly benefit the bottom so by by the virtue of what the Fed does. Yes, they always bail out the rich first, right? So, so yes, the Fed basically always
[34:21] So, so yes, the Fed basically always bails the rich out first. Like it's it's like it's like the first class on the Titanic class on the Titanic uh on the Titanic. It's all rigged
[34:33] against poor people, you know, that that's why it's important you know, that that's why it's important to as as soon as possible. owns some of the means of productions. You must become an owner of the means of
[34:48] production which that's not to be like impractical [clears throat] here. It's impractical [clears throat] here. It's to say that you can be by you know starting a you know high quality trade company right
[35:02] company right uh electrician plumber uh HVAC you know grow the business uh hire people buy real estate real estate uh now you benefit right that's that's
[35:16] the theory see because now you're one of the people hiring right that's That's how our Ponzi works, if you will. You kind of just have to know that. You have to know the rules of the game because if you just complain about the rules of the
[35:30] game and you don't know the rules of the game, then what's the point? You're just somebody actually tells you, "Here's how the game is played," then maybe you can Anyway, let's go look at the Treasury market.
[35:51] No movement. Spread hasn't moved. Actually, spread did move. Good. Back to 67. Good.
[36:07] So, that's good. Uh, let's go see what else we have. I I'll summarize this and just do like a little, you know, 8 minute breakdown in
[36:20] just a moment. I just want to see if there's anything else I can really see here. And so far, the answer to that is no.
[36:35] Uh, let's see here. It's This is This is honestly kind of Goldilocks. yesterday? Yesterday.
[36:48] [clears throat] Ah, okay. Yeah. So,
[37:01] yesterday in the alpha report, I wrote I'll show you the following. I wrote I'll show you the following. Uh, let's see. Alpha alpha alpha. Uh, let's see. Alpha alpha alpha. Uh I will paste that in right here.
[37:16] In yesterday's alpha report I alpha report I uh I wrote.
[37:29] So [cough and clears throat] I I yesterday I wrote that uh yesterday's expectation was 60K. It got revised up
[37:41] to 70. I wrote that anything over 40 is probably good given the 3-month average is 40K. It's 49ish for the year. For the year is 49K. So anything better than 40K
[37:53] is economically good. over 90k expect like substantially reduced rate cuts for the year. We already knew January was out, right? Uh and then under zero is economically bad. So like if if I just say, you know, and
[38:08] is the first one giving you color blah blah blah. So if I put this together, uh this kind of gives you a guide that that this is actually economically good and and that roughly aligns with my expectation right now, which is
[38:24] obviously, you know, all right, you know, obviously um good for stons. Um you know, it's like it's this it's what I like to call this Goldilocks middle I like to call this Goldilocks middle ground. Uh so we'll say that Goldilocks
[38:40] ground. Uh so we'll say that Goldilocks uh middle ground uh it's not great but not terrible, right? Which is kind of a line from that HBO nuclear Chernobyl series. Not great, not terrible. I think that's really a great way to put it.
[38:54] that's really a great way to put it. It's it's good enough to see stocks go up. um [clears throat] um [clears throat] bad enough to suggest two rate cuts this
[39:07] bad enough to suggest two rate cuts this year but not uh now Fed will wait right if it were not for healthcare aka pharma jobs would be um
[39:25] what did we just get we got 50 healthc care was I think healthcare was healthcare was 40. So no it'd have to be worse than Let me see let me double check what healthcare was really quickly
[39:42] healthcare was really quickly and then we'll do a summary.
[39:58] So, where are they getting that from? Let me go see if there's a BLS stat on that. It should be health.
[40:16] healthcare was only 21K. So, you need education and health. Yeah. So, that's wrong. I I don't know. Maybe they maybe that you either misquoted they maybe that you either misquoted that or they're wrong.
[40:31] It was more broad-based than that because of leisure and hospitality. What's the 27 weeks unemployed number? Yeah, we wrote that down. Uh,
[40:44] it was 1948, I think. Yeah, 1948.
[40:59] keep getting more elevated valuations." Okay, I guess I'm not buying outside of quick swings or scalps. Yeah, I mean, [clears throat] [clears throat] you know, I I think
[41:12] there are few there there are a few places that it makes sense to buy, but places that it makes sense to buy, but not many. Okay, let's get this ready for a summary.
[41:29] numbers. Fed's going to get rugged. Yeah. I mean, in fairness, in other data, uh, like surveys and that, we're we're not seeing the layoff cliff yet. People are still holding on to jobs, right?
[41:46] Uh, and that's that's the thing here. So, So, let's break this down. let's break this down. Let me uh save this.
[42:00] Oh, man. [clears throat] Okay. [clears throat] Okay. Yeah.
[42:15] about nuts yesterday and I'm paying the price for it. People got me too triggered. [laughter] Oh man. It's all right. All right, let's uh let's go through this. I I'll really
[42:29] [clears throat] Get my nuts again. Ah, I saved them. Get my nuts again. Ah, I saved them. All right.
[42:43] are out and I have lost my voice because yesterday I was screaming so much about [clears throat] and debating people about the Mediterranean diet on the live stream. I basically went downhill from there. But
[42:56] what didn't go downhill was the jobs data. The jobs data was actually somewhat decent. Now, I know that immediately pisses off a lot of people who are like, "Kevin, how could the jobs data be decent? It's all plummeting."
[43:10] Yeah, look, it's way lower than what we had last year. Uh last year we generated had last year. Uh last year we generated over 2 million jobs in the entire year. This year we didn't come close to that number. Uh this year we were uh at
[43:26] 584,000 jobs. Uh which means we averaged about 49,000 jobs per month. And again that is down from the over 2 million in 2024.
[43:38] this, and I'm I'm going to kind of keep it a little short because my voice is killing me, but keeping it a little bit short. This obviously kills rate cut expectations for January, but honestly, it probably also kills rate cut
[43:52] it probably also kills rate cut expectations for March. In fact, the market right now is pricing in a 5% chance of a rate cut in January and a chance of a rate cut in January and a 28% chance of a rate cut in March. Now,
[44:06] why do I say this is Goldilocks if we're not actually pricing in a full rate cut until June 17th, which is when we have the new Fed chair, which could be this schmuck. Uh, this guy's a wet blanket. He's better than the Kevin Walsh guy. I
[44:20] I wish they would pick Myron or Waller rather than this schmuck, but this rather than this schmuck, but this schmuck would be better than Worsh. That's just my opinion. Anyway, so the reason I say this is Goldilocks is
[44:34] yesterday in my course member live stream and the alpha report, which you can get at mekevin.com, I talked about how uh the estimate was 60K yesterday and that got revised up to 70K, mind you. So this morning we were expecting
[44:48] you. So this morning we were expecting 70k jobs. We got 50. So it was a miss, right? But I wrote anything [clears throat] over 40 is probably good given Powell thinks the 3-month average is 40 uh minus 60. Okay, fine. So that's
[45:03] stable. We really don't want to fall off a cliff. Anything under zero would be really bad because then we're going to revise down from there. We also had downward revisions, right? So when we look at the data, the last two jobs
[45:16] reports were revised down even more. The October revision was insane. We revised October revision was insane. We revised October from -15 down to 173,000 jobs gone. We also revised
[45:33] November down 8,000 to 56,000. So we lost on both of those. Now where we gained is the labor force participation rate actually came down a little bit which helped the unemployment rate that headline number fall from 45
[45:49] to 44 which is interesting because the Fed says that unemployment rate matters most to them they're watching that headline number which is not great now because it's what I call not great not terrible it seems like you're seeing
[46:05] some anxiety come out of the market and see the bond market, the 10-year is staying elevated a little bit. The the 2-year is rising a bit. So, you're unpricing some of that spread between [clears throat] where the Fed's rate is
[46:19] and where the 2-year market thinks the rate should be. So, as the 2-year comes up again, you're actually compressing the steepener, which we don't want this to go up to 1.25 because that would mean we're likely in a recession. Now,
[46:34] something else that obviously continues to slowly tell us there are recessionary concerns is this. Look at this chart. You should remember this. Excuse me. So, this is the when I drink water, it gets better. Um, only a
[46:50] recession cures the long-term unemployed number. Only a recession does. Without a recession, you can't get this number to come down. This is the 6 months unemployed level or 27 weeks unemployed level. It is rising, continues to rise.
[47:06] It rose again in December, which is not even charted here. So, it probably be up over hereish somewhere where my mouse is. Uh, that's not charted yet because the data hasn't updated quite yet, but we already know what the number is. You
[47:18] can see it. The only way this comes down is after a recession, but it rises during a recession or before a recession. In this case, it was during. In this case, it was during. In this case, it was during. It started early,
[47:32] right? Started in like 2006. Well, this has been going on for a while. That long-term unemployed. Now, a lot of people are saying, well, this time is different because of artificial intelligence. Maybe that's true. But I
[47:45] would argue that broadly what we've got here is a middle ground. Kind of Goldilocks. Not great, not terrible. This is enough to see stocks go up. It's enough to see a broadening out of stocks. We did see data that you know
[47:59] stocks. We did see data that you know was actually pretty diffuse. You had uh leisure hospitality up 47k, healthcare up 40k. Yeah, manufacturing was down 8K, up 40k. Yeah, manufacturing was down 8K, goods producing down 21K. But none of it
[48:12] is saying only one sector helped us. There were multiple sectors that helped us here. Leisure, hospitality, and healthcare up 87,000 jobs. It's pretty decent. Now, private payrolls only grew about 36,000, which is certainly weaker
[48:28] about 36,000, which is certainly weaker than what we were expecting. payrolls and we were expecting 75,000 and we had a negative 19,000 revision on
[48:40] the prior. So, you know, the numbers themselves weren't great on the establishment, but again, not terrible. Now, the household survey was pretty Now, the household survey was pretty good. that came in at positive232,000.
[48:54] Now, who knows? Some of the numbers can be rigged. It could all be catch up from October, but I think really what this tells us is in the near term with the tells us is in the near term with the Atlanta Fed real GDP level at 5.4% 4%
[49:07] which is insane. Probably shouldn't be expecting rate cuts anytime soon, which is unfortunate because we kind of know that the underlying economy really needs it, but we're probably not going to get them for the time being, at least until
[49:21] inflation concerns come down. I do hope that tariffs end up getting banned by the Supreme Court, at least the AIPA tariffs, and I think that's likely. I don't know if that'll be today, but we'll be watching. Now, [clears throat]
[49:35] something else to know. Somebody asked me, Kevin, why does the Fed always only bail out rich people? Let me answer that because it's a function of capitalism, and it might be the most important message out of all of this.
[49:49] Out of water. It's not good. [snorts] The Fed, the Fed only bails out rich people because they do not have the functions to bail out poor people. the government can bail out poor people with stimulus checks, subsidies, welfare
[50:04] stimulus checks, subsidies, welfare money, uh whatever the problem is. The more the government state provides [clears throat] welfare checks, the more fraud you get. That's why governments have dead weight loss. That's why we say
[50:20] government spending is generally a loser for the economy because of that loss that occurs. The government's really bad at making sure they don't lose money, unlike a business, which is generally better at making sure you don't lose
[50:34] money. Anyway, that's just the nature of the government. The Federal Reserve doesn't have the tools to bail out poor people. The Federal Reserve has the tools to bail out rich people, people with houses, people with businesses,
[50:50] people with debt, and bankers, private equity. Those are the people who get equity. Those are the people who get bailed out. The Ponzi theory is if you bail out the top, they'll create a conducive soil in the economy so good
[51:03] jobs can grow. That's why when you understand the rules of the game, [clears throat] you understand that you have to you have to know the rules of the game of how the Fed works. The Fed will only ever bail out rich people in
[51:17] will only ever bail out rich people in every single economy. And as soon as you know that that in the Titanic the first class people always get on the boat first. The way you level up is you become an owner of the means of
[51:31] production. That could mean owning stocks. That could mean owning real estate. It could also mean you taking advantage of your time by contributing to a business that owns the mean means of production where you're actually like
[51:44] creating real value for a business that owns means of production. Whether it's owns real estate or provides AI services or whatever or you go start your own business owning the means of production like become an electrician, a plumber,
[51:57] HVAC tech or whatever. Grow a business, hire people, buy real estate. Now you benefit. That's how the game is played. That's how the rich keep getting richer. And that's the Federal Reserve's Ponzi for you in a nutshell. So yes, don't
[52:11] expect rate cuts until the next Fed chair with these sort of job numbers. We're not falling off a cliff. This is the same thing we're seeing in the ISM numbers, the S&P numbers, the Jolts data. There's no evidence right
[52:26] now we are falling off a cliff. And if we can rebound here, we can stick a soft landing. So, it's more bullish than it is bearish, but we should be cautious.
[52:38] is bearish, but we should be cautious. Anyway, thanks for