---
title: 'i f**k''d up'
source: 'https://youtube.com/watch?v=Hbec26OM4hA'
video_id: 'Hbec26OM4hA'
date: 2026-06-28
duration_sec: 1397
---

# i f**k'd up

> Source: [i f**k'd up](https://youtube.com/watch?v=Hbec26OM4hA)

## Summary

Financial analyst Kevin admits he was wrong about his recent bullish market outlook, citing a complex confluence of events including Fed policy misreads, yen carry trade dynamics, and tech sector weakness. He analyzes how six bearish factors like Kevin Warsh's hawkish silence, SpaceX's early peak, and Micron's sell-off on good earnings have shifted market leadership from hardware to software. The video aims to provide transparent analysis and identify where the real opportunity lies despite near-term timing errors.

### Key Points

- **Overestimated Warsh's Dovishness** [00:55] — Kevin was too optimistic that Kevin Warsh would be a dove; instead, Warsh chose silence, signaling Fed independence and hawkishness, which markets interpreted as short-term bearish.
- **Yen Carry Trade Unwind** [03:48] — The yen broke through 160, prompting fears of Bank of Japan intervention. Hedge funds sold US tech stocks to repay yen-denominated debt cheaply before intervention, accelerating the sell-off.
- **SpaceX Peak Came Early** [05:26] — SpaceX's meme rally peaked after just three trading days (around June 16), earlier than Kevin's expectation of early July, contributing to tech sector volatility.
- **Micron Sell-off Signals Low Liquidity** [07:05] — Micron's positive earnings were followed by a sell-off, and the post-earnings rebound didn't cover the initial drop, indicating a lack of liquidity in the market.
- **Apple Price Hike** [08:00] — Apple was rumored and then followed through on raising device prices by 16-20%, dragging down Apple stock and adding to bearish sentiment.
- **Palo Alto Networks Financial Warning** [14:40] — Palo Alto Networks shows declining net income (-33% over 9 months) and rising stock compensation (+39%), suggesting pricing power may be weaker than investors assume, though operating cash flow is strong.
- **Cybersecurity Valuations Rich** [20:10] — Kevin believes cybersecurity stocks are expensive because many companies in the space barely make money (low EPS), making their PEG ratios look high despite being AI beneficiaries.

## Transcript

All right, everyone. Me Kevin here.
Look, I was wrong. I made a mistake on
some recent bullish optimism, and I want
to come clean about what was wrong and
where we're going now, because the
market's going into a very interesting
direction. And I think it creates an
opportunity for us. Uh but in order to
actually understand what this
opportunity might be, we should really
just sit down together and have a
conversation about what went wrong uh
what went right and which of the thesis
sort of still remain in play. Uh because
there are a lot of them that actually
remain in play. We just want to make
sure we have the timing right. Uh and
there's a new sector that's getting a
lot of attention right now, but I
actually think there's a warning to be
had around that particular sector. And
so we're going to go through some
analysis. I'm going to give you my full
opinion on all of this. Uh, but first,
I'm I'm just going to be very straight
with you and blunt with you about where
I was wrong. I think the largest mistake
that I made over the last week, week and
a half here is I was too optimistic that
Kevin Worsh was going to be a dove. He
basically chose violence by choosing
silence. He chose silence as a way to
signal Federal Reserve independence and
his commitment to the left side of the
decimal point of inflation, which to me
sounds long-term doubbish, but to
markets sounded short-term hawkish. And
of course, that's why markets reacted
the way uh they did. Uh and this was
also accelerated by some other issues in
the marketplace that we should really
discuss. Uh and I think when we put it
all together, we can really understand
why market leadership is moving. uh from
where it had been really sexy, you know,
Nvidia to some extent, uh AMD, even the
memory chip stocks, which today are
giving back even more of their gains,
which means we're not back to levels we
had before micron earnings, and now
we're even lower uh than uh than than
where we've been over the last, you
know, post earnings rally, if you will.
Uh so, let's understand this. The very
first problem that we had was Kevin
Walsh. There's no question about that. I
want to be very clear. I'm not changing
my opinion on Kevin Walsh. I think he's
a guy that is going to drive interest
rates to zero. The biggest concern I
have with Kevin War is based on his
history, he is not going to be a money
printer kind of guy, which means when
and if we have a uh, you know, dramatic
recession or depression because AI
hardware rolls over and everybody loses
all their money because growth rates
roll over and people are like, "Oh my
gosh, please run the money printer and
bail us out." I actually think he's not
going to run the money printer, which
does create a real risk factor for how
quick of a V-shaped recovery we recovery
we would have, such as that bottom that
we saw uh in uh you know, September to
March of 2002 to 2003, the V-shaped
recovery we saw in February of 2009, the
V-shaped recovery that we saw uh in
really January of 2019 after the
December bond market crisis and the Fed
pivot then. Uh and then of course the
March COVID Fed pivot. You could even
throw in sort of the banking crisis,
massive, you know, rapid bailout if you
will or guarantee of bailout. Uh all of
those things have been associated with
prior Fed generations of we're going to
run the money primer. I do not think
Worsh is going to be that guy, which
makes me concerned. But I also maintain
that I think he's right. We are going
into a disinflationary regime, maybe
even a deflationary regime. Okay, that's
worse. You probably already know that
opinion about me. I just want to make it
crystal clear that even though he came
out hawkish, I still think he is a
deflation dove. I don't think any of
that has changed. The timing was just
complicated. Here's why. Right after
Wars comes out dovish, we end up getting
the Japanese yen breaking through pretty
bad technical levels which send the
signal that intervention might be
coming. when USD trades, you know, when
you get one USD to one JPY that's
sitting above 160 now, sort of rejecting
off of 162, people fear that, oh no, the
Bank of Japan is going to intervene. We
may as well quickly pay off debt. Uh,
you know, US hedge funds may as well
quickly pay off debt. So, what do they
do? They sell high-flying tech names in
the United States because it is now
cheaper to do so before that potential
intervention. I didn't as clearly as I
should have explained that in my video
two days, two or three days ago. Uh
there was this implication that you know
somehow people are uh liquidating their
Japanese yen debt positions because the
yen is getting weaker which actually
makes it cheaper to pay off that
Japanese yen debt. This is true but that
is the perfect opportunity people use to
pay off their Japanese debt before a
potential intervention risk. So I just
wanted to clarify that. Ignoring the
complexity of that for a moment, Kevin
Worsh goes hawkish when Kevin thought
doubbish. I still think long-term
doubbish, but that's obviously bearish
for tech stocks. The Japanese carry
trade getting cheaper to pay off is
bearish for tech stocks. Third thing, we
all knew, and we talked about this ad
nauseium, we knew that SpaceX was going
to meme rally because they were only
putting out 4.2% of the float. We knew
that was going to happen. We knew it
would peak out. The only problem is we
don't know when. People ask me, Kevin,
when should we buy puts on SpaceX? I'm
like, it's really tough to know exactly.
I think the beginning of July. I didn't
buy any shorts or puts or whatever. It's
just not my trading style. And
unfortunately, it didn't peak out at the
beginning of July. It peaked out after
just three full trading days, which
would be around June 16th when Jim
Kramer really hyped it up. Okay, maybe
that was our real warning sign. But
anyway, that peak came a lot quicker
than expected for SpaceX. And you know,
maybe I need to get used to things just
coming quicker than expected around
here. But that is another bearish move
for the tech sector because it
contributed to uh the insiders open over
at OpenAI saying, "Hey, we're going to
delay our IPO till 2027." Three
insiders, anonymous insiders, uh
revealed that volatility because of
SpaceX and tech stocks recently uh
contributed to the decision to uh likely
delay the open AI IPO. That's not
official yet, but that's the
expectation. Then number four, you know,
that obviously number three is bearish
uh uh attack, but number four, you had
the SpaceX bond sale. The SpaceX bond
sale sold with a way higher spread than
it should have. 50 basis point premium
over Intel is not good. That was the
bond market going, you know, we don't we
don't like this. We're gonna have to be
compensated for this. And they were, you
know, obviously bond holders have a
priority over all equity holders, so
they already have that in the event of a
bankruptcy. Not that anybody actually
thinks SpaceX is going to go bankrupt,
but you know, there was a very clear
desire for more protection uh from the
bond market. Uh that was bearish tech.
Then of course we had the premicron
earnings sell-off, the postmicron
rebound which did not cover the sell-off
and now we have even more of a post
micron earnings sell-off even though the
earnings were fantastic.
That is a sign of a lack of liquidity,
right? So in other words, it's like we
know Kevin Wars was going to be doubbish
but he wasn't dovish quick enough.
That caused the yen problems. We knew
SpaceX was going to peak, but it peaked
before the end of the month, earlier
than expected. We knew that Micron was
going to be really sensitive at the time
of earnings, but instead of selling off
on earnings, it sold off right before
earnings and then the day after the day
after earnings, two days after earnings.
Right on top of that, which we also saw
coming because we subscribed to the
Alpha Wire, which is totally free. You
could get on the Meet Kevin app. um
Apple Android app store. We saw that
Apple was rumored to raise prices uh on
their devices by 16 to 20% and they did.
Unfortunately, that dragged Apple down.
So now you've got six bearish items that
occur inside of the tech stack. And
where are people flocking? That's what
we're going to talk about next. But all
of this is a downweight to bullish end
of the month targets for the NASDAQ 100
because technology stocks are basically
getting hammered especially hardware
exposed relative to where expectations
have been and this is unfortunate. It it
it means that in the short term we had
noopsy dupsy and I apologize for that.
Can't be perfect all the time. I know I
know people regularly they say Kevin how
how are are you hitting all these
targets on the alpha report or you know
whatever and it's like well we don't
always uh and this is unfortunately uh I
mean one of the first ones that I could
think of in a while off the top of my
mind here where uh you know we we're
just not going to hit our QQQ price
target for the end of the month. Uh, and
I'm disappointed by that. And I'm not
trying to make excuses because I still
think that I'm correct on Warf. I'm
correct on SpaceX. I still think I'm
correct about that. The Harbor Cycle
still has legs. AVG go, you know,
Broadcom and Micronics are so freaking
good. We've still got legs on that
movement. But unfortunately, when you
combine all these things together, it
means we could be right about the long
term, but wrong about the timing in the
near term. And I think it's worth being
transparent about that. Uh, of course,
then you can add in number seven, that
Kevin is still somehow on vacation. I'll
be back on Sunday, so maybe that's the
true catalyst. That said, let's get into
where markets are actually going right
now, and that is to some extent cyber
security, but also software. Now, I want
to caution some of this. Excuse me
because we have seen this game before.
So I really want to be careful here. Uh
first of all I want to look at what some
software movers have done today. We had
Axon stock up 4 and a.5% great into it
up almost 5%. Palunteer which has been
plummeting close to my $89 price target
or trending in that direction was up 5%
today. Cloudflare up 46. Crowd Strike up
three. Meta up 13. and Microsoft up
almost 6%.
Uh, in my opinion, and that's a $2.7
trillion company. In my opinion, some of
what's going on here is a short squeeze.
I think a lot of stocks like Microsoft
and Meta, uh, into it, Axon have been
shorted and, uh, as a result, we get
these these sort of relief days where
the shorts take profits, they have to
cover, they have to buy the stock. Those
are not necessarily lasting moves. I
can't call a software bottom yet. I
still maintain that a software bottom
will come in the third or fourth
quarter, but I don't know exactly where.
And I do think there are opportunities
to buy software, which even though I
haven't bought Palanteer yet, I am
tempted to because it's getting cheap. I
want to be clear, I'm not tempted to buy
Bitcoin. I don't own Bitcoin. I don't
own Ethereum. I don't own crypto. I
think outside of like a maybe like a,
you know, short week basis of like a
week, a few weeks of a trade, I've never
held crypto. Uh, and so I'm not
advocating for that and I'm not trying
to argue that, oh, crypto's bad, stay
away. I'm just saying that's not what I
think is the next play. I really think
software is the next play. I just don't
know when. So, I'm just being very
transparent about that. You know, some
knucklehead left a comment yesterday
like, Cad, you're complaining about the
market only down 4% off alltime highs.
But the whole point of these videos is
to help you pick up on directional
trends that are occurring so you could
see these things happen before they
happen. You know, for example, when we
turned bullish around April 4th, and I
think this is really worth mentioning,
we turned bullish around April 4th, the
NASDAQ 100 was trading for around $590
a share, you know, via QQQ. Uh, and now
we're at 76.
So yeah, we missed the upside price
target, but we've had so much upside
between then and now. And we've been
right about the direction, but we've had
a lot of doubters. Now people, you know,
those same sort of people, but Kevin,
why didn't you tell us to buy then? I
did. And they're all documented videos,
right? That's the beauty about this
channel is is we're going to be
transparent about the wins. Also, the
L's. So the next phase that I see is not
software right now. Even though IGV is
moving, I'm going to tell you why I
think IGV is moving. IGV is the uh
EyesShares expanded software tech ETF.
Uh it's been doing decently. It actually
went up 4% today. So you look at IGV, it
was up 4% today and the NASDAQ was down
1.38%.
That's a that's a 5% spread between the
two, which suggests that hardware is
being sold and software is being bought.
But that's too simplistic. You know,
Nvidia is down another 1.6% which is a
big deal for a big company like that.
But it's too simplistic to say that. I
think that Microsoft and Meta in it
Axon, I think there was a little bit of
short covering going on in these. And
what's really actually driving IGV up
lately are companies like Palo Alto
Networks, cyber security plays. PanW has
recently exploded in price. You know, I
I uh I wish their growth was a little
bit stronger. Uh, and even though their
growth is good, I wish it was a little
bit stronger. You know, just about a
month ago, they were trading for around
130, 140, 150 bucks. Uh, and their stock
price growth has been phenomenal. But
I'll tell you where I see some of the
skeletons in the closet. Stock price
growth has doubled uh in that time
frame. Cyber security stocks have done
exceptionally well and they started out
expensive and now they're even more
expensive. Okay, so here's the problem.
Let's zoom into a company like Palo
Alto. Now, you're just going to have to
rely on me talking about this verbally.
This will be posted in the stock tab of
the Mean Kevin app for all those of you
who are members. So, you'll be able to
actually see the analysis. You can also
use our uh new stock tools uh and do the
analysis yourself. That's all obviously
included in your membership when you
join over at meetke.com. We do have a
price increase on the 30th, which is on
Monday uh last day of the month. And
that's also when we're coming out with
our valuation reinvest product over at
reinvest.co or houseock.com. That uh
valuation feature is coming out on
schedule. But let's look at PANW for a
moment. So if I go to the cash flow
statement on PANW over the last nine
months, I actually have net income, but
I have declining net income, which I
find very interesting. The company has
seen its net income decline by 33% over
the last 9 months. A little odd. At the
same time, their net income has gone
down by, you know, that 30-ish percent.
We've seen stock compensation rise by
39%. So, my assumption is they're paying
more for AI talent while at the same
time the company's net income is going
down, suggesting their pricing power may
not actually be as big as people think.
Now, in fairness, their operating cash
flow is great. It's up about 18.5% and
they spend very little on capex. That's
very different from a company like
Microsoft or Meta, which are companies
that are blowing money on capex. So is
Google, you know, Alphabet. And as a
result, they are actually able to
repurchase stock. Something that, for
example, Meta and Google have not been
doing recently. Repurchasing stock.
They've repurchased about a billion
dollars of stock in the last nine
months. Uh they have uh you know, in my
opinion, they've recently gone through
this transition of oh AI is a threat to
AI as an opportunity. I think that's
going to happen to software as well. And
then we'll see those same or similar
moves in some software stocks. I don't
really personally like IGV because I
don't like a lot of their holdings. You
know, for example, they hold Adobe and
they hold Service Now. Now, I apologize
to or even Salesforce. Now, I apologize
to people who own those three stocks,
Salesforce, Service Now, and Adobe, but
I think those are three of the most AI
replaceable stocks, whereas companies
that utilize government data like Axon
or business data like in it are some of
the least replaceable stocks. Yes, it is
true that at into it some of their usage
is declining because the free tiers as
some would say the brokies that's not
meant to be offensive that's what some
analysts actually say they are not using
the product because they could use other
free services or AI or whatever but
people with more complicated uh uh you
know businesses are actually spending
more money on the AI enhanced features
at into it and you're seeing a similar
thing over at Axon with more revenue
coming in due to uh their AI enhanced
platform I mean People don't even talk
about Done and how valuable that's going
to be for uh policing. Uh people don't
even talk about how their artificial
intelligence dispatching software, which
is a company they acquired and now
they're integrating even more AI into
it, uh is is a moat that just doesn't
exist anywhere else in my opinion. But
anyway, so so I like Axon and into it
and they do have exposure to it, but I
personally think that Adobe and Service
Now and Salesforce are more replaceable
AI. I also don't like Oracle spending. I
think they spend like drunken sailors.
These are all high holdings. These are
all within the top 20 holdings of IGV.
So, I don't actually like IGV because of
that. I'd rather pick the names that I
like. Like right now, I do like their
second largest holding, Microsoft. I'm
getting close to liking Palanteer, their
third largest holding. I am liking
Apploving, which is about their seventh
largest holding. Uh I also like in it,
which is about their 14th largest
holding, and so on and so forth. Right?
So I don't like the whole IGV ticker. I
like components of it. Now as far as
their biggest holding PaloAlto Network,
it's the cyber security momentum at a
high valuation that I expect will
translate to software survivors over
time. The issue that I have with
PaloAlto Networks though is not their
balance sheet. Balance sheet is great.
I've got about 5.2 billion in cash and
cash receivables. I've got about two
billion in current liabilities. So no
liquidity issues over the next year. And
even if I include the long-term debt, we
really don't have liquidity issues.
Long-term debt is uh sitting at around
1.9 plus 1.2 in convertibles, the
converts are going to convert because
the stock is going up and the long-term
debt is more than offset by the cash
that they have available even after
current liabilities. So, balance sheet
fine. What about the revenue statement?
Well, this is where things actually get
a little interesting. So, their total
revenue went up 31.1%.
But their total gross profit only went
up about 21.4%.
So pricing power is shrinking, which is
odd. Why is their gross profit
declining? Well, I mean, I shouldn't say
declining, but only growing at 21% when
their top line is growing at 31%.
At the same time, their sales and
marketing is up 46%.
So, your top line is up 31%, but your
sales and marketing is up 46%. So, are
you having to spend more on sales and
marketing to get more customers? pricing
power is, you know, also shrinking. So,
that's sort of a hm their SGNA doubled.
In fairness, some of that could be
because of recent acquisitions. Uh they
have recently made a few uh
acquisitions. Uh they acquired
Chronosphere and Cyber Arc. Uh and uh
they had revenue of 388 million and 391
million uh for for for those companies
combined. Um those companies also posted
an operating loss of 523 and 524 million
for the 3 and 9 months ended 20 uh April
30th 2026. That's sort of the combined
uh in revenue and loss of both of those.
So they acquired some money losing
businesses. That could be part of why
their margins are compressing. But it's
also possible that cyber security stocks
are a very competitive bunch. Cloudflare
is losing money and yet their revenues
are exploding and Crowd Strike is barely
making any money which is weird. Like
how do these companies that have been
around for so long barely make money?
And that's the biggest issue I have with
these cyber security plays which makes
their price to earnings growth multiples
look very high because their EPS is very
low. That makes me frustrated by cyber
because I actually agree that cyber is a
great beneficiary of artificial
intelligence. Huge beneficiary, just not
at the price. I like it. I'm very uh
picky. Like I want Palanteer at 89 bucks
and I'm going to wait until I get my
Palanteer at 89 bucks. Now, if this
proves to be a software bottom and
Palanteer skyrockets from here, well, I
guess I missed my opportunity. But I
think this recent software push we've
seen is the same that we've seen about
four weeks ago and a couple weeks even
before that where you get like one or
two updates on stocks like Microsoft and
then they go down even more. This is why
the allocation that we're throwing into
stocks while we're allocating stocks is
relatively low to cash or other assets
because some valuations are, you know,
some stocks are still falling knives and
you're going to be able to get them
cheaper. Other stocks just have
ridiculous valuations.
This is all combined with the fact that
I was still overall and economically
bullish on Train America. So, this is a
lot of information to ingest and I
personally think and maybe I'm wrong
about this. Maybe leave me a comment.
Although I don't think if I'm wrong
about this, the the people who would
tell me I'm wrong about this are
actually watching this. But, you know,
for the 10 of you watching to the end,
first of all, I really appreciate you. I
I my goal is to provide perspective and
and a lot of perspective on what's
actually happening out there. And my
goal is that hopefully you're like, "Ah,
I didn't think about that confluence of
Apple, SpaceX, Bon, SpaceX, the Japanese
yen, Kevin Worsh, and Micron all
happening at the same time, tanking the
cues down, screwing up timing as quickly
as it did." Oh, I didn't think about how
cyber security looks expensive because
they barely make freaking money and they
might be a competitive, really
competitive business because any Joe
Blow can go start a cyber security
startup. I mean, okay, I'm not trying to
be facitious to these companies, but
there are a lot of cyber security
companies out there, okay? Like, you
look up, hey, I need a Pinterest done
for House Hack, let's say. Dude, there
are like 50 companies I can call and and
you know, we've talked to a lot of them.
We're like, man, how do you all even
differentiate yourselves? Geez. Um, kind
of wild. Uh, but anyway, so so putting
all of that together, my goal is to
provide unique insights based on what
we're seeing as business operators, uh,
but also as financial analysts. what I'm
seeing on actual documents. Uh and then
of course just being transparent where
where uh things are going well and
correct and where things are wrong. Uh
and so hopefully that transparency is
useful to you. If you want more of that
sort of analysis or transparency, come
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will see you in the next video. Oh, look
at that. I could zoom in and out. Whoa.
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