FOMC Powell Prep & Stock Market Open: Critical Day!

[00:05] All right, all right, all right. It is Jerome Powell day. Oh man, on the same Jerome Powell day. Oh man, on the same day that PPI comes in nasty. I mean, talk about nasty across the board on PPI. Not not great. Not a lot of

[00:20] exciting things to look at on PPI. See how the market opens today, but I'm not very excited about it. Uh at least until we get some confidence from Powell that they're not yapping about rate hikes. Uh but anyway, let's go get the

[00:33] we've done the bell together. So, we're going to do the bell together. Here we going to do the bell together. Here we go.

[01:15] Often times what happens is we end up getting a getting a uh flip flop on the board where the ends the day more mixed, uh potentially

[01:27] matters a lot today it's I mean, it's really Powell. Uh until then, you know, just wouldn't surprise me at all to see nervousness in markets and some some frustration because uh you know, Powell's going to drive the boat today.

[01:41] I mean, look at the PPI numbers that we got to this morning. So, PPI come had an expectation a prior read of .5 on final demand month over month. The survey for demand month over month. The survey for PPI comes in at .3

[01:56] and uh we ended up getting .7, uh which is not great. So, that's substantially higher than expected. remove food and energy, we were expecting a .3, but we got .5,

[02:11] which is a lot higher than expected. Uh and then if we actually take out trade, we also saw a miss here with a survey of .3 and then a .5 on the month over month

[02:24] ex-food energy trade. Final demand year-over-year up at 3.4, a survey said year-over-year up at 3.4, a survey said three, not great. PPI ex-food energy trade year-over-year 3.5. Survey said 3.4.

[02:37] Uh all of this not good. We do have factory orders and durables, capital good orders all coming out at 7:00 a.m., which is in about 28 minutes uh Pacific time. None of this I think uh you know, is really going to be a needle

[02:49] mover. The needle mover today is going to be all about Powell. Somebody here in the chat says, "Good morning from Barrows." So, what's up? That's awesome. I love doing Barrows. I remember when that came out. I can't remember the

[03:04] year, but I remember as a child playing it. It was either 2006 or 7. You know, right around the time farming Well, it came out before farming. But uh man, I love Barrows. Uh I still got my great axe somewhere. I have a giant 3D

[03:16] printed great axe. I think it's next door. But anyway, So, um yeah. Now, um let's go take a look at this PPI right here. Producer price index. Oh yeah, and then

[03:30] stream, we did a deep dive in out Well, I mean, it wasn't It daily basis, we do nice deep dives on fundamentals. Uber with the earnings calls and the financial statements. Today, I just did

[03:45] a quick skim with course members on you know, Reddit and we set up some strategies for trading the the Powell meeting today. You could obviously still see that strategy if you join over at mekevin.com. But this

[03:57] morning, we did some analysis on Reddit. And uh I you know, I kind of encourage You know, the Reddit financials. They are they're actually pretty pretty impressive. You know, I've I've always got a two-by-two foundation I

[04:10] look for. I look for valuation, pricing power, power, balance sheet, and momentum. And uh you know, Reddit's doing pretty well on all of those. But anyway, producer price

[04:24] Feb. Uh see obviously some risks with Reddit regarding AI, but I think they're also benefiting from AI right now. But final demand price has moved up. Okay, so what what was the reason here? More than half

[04:39] of the demand of the increase was due to final demand services. Okay. So, that's interesting. Index comes for So, that's interesting. Index comes for What services?

[04:57] which is not great. Yeah, SB in the chat here says, "Hey Kev, destruction of oil and gas reserves is really bad now." Yes, it is. You are 100% correct about that. Iran has stated that they will um attack our

[05:15] oil and gas infrastructure or ally oil and gas infrastructure in the region, I should say. Uh if we or Israel attacks theirs, and we just had South Pars theirs, and we just had South Pars attacked, which is you know, an Iranian

[05:29] um set of oil or oil fields and storage, and the Israelis just attacked it. So, not great. Not great. Uh we can see this here. The South Pars North Dome field is a natural gas

[05:45] condensate field located in the Persian Gulf. It's by far the world's largest natural gas field. Uh with ownership shared between Iran and Qatar. Oh, I guess it's more natural gas focused. Okay. Well, either way, it's oil and

[05:57] part of the same. Hence why I think we're seeing oil up. Uh well, oops. Oil up here about 4%, which is quite a quite a You know, quite quite a bit. We're at 108 on Brent now, which is

[06:13] not great. Uh but um Let's see here. Uh this Wow, look at that. According to Wikipedia, which is not really a source you generally want to cite. We can

[06:26] always get to the underlying over here. But uh has an estimated production of about 80% of their government revenues coming out of those Qatari gas fields.

[06:41] Really interesting. Uh and apparently Israel targeted uh their the Iranian Iran says strikes. Uh let's see here. Oil and European pledged to retaliate in response to the

[06:56] country's upstream energy assets. Brent climbed. Iran said the US and Israel attacked the South Pars gas field associated uh facilities. Issued a warning about staying away from a range of similar assets in other

[07:10] Now, So, uh this is you know, this is escalating, right? It's it's not getting better. It's it's getting worse right now. Um Germany Germany just uh okay, we got

[07:24] some I want to read more about PPI here, but I'm getting some headlines coming but I'm getting some headlines coming across. So, let me just pop into uh this. Look at some of these headlines. Uh okay. So, um Merz

[07:39] >> of Germany Oh, can't type today. Okay. Oh, can't type today. Okay. Merz of Germany. What do they have to say? They say uh no convincing

[07:56] democratic change can be brought to Iran. We were not consulted. brought to Iran. We were not consulted. We were not consulted. Daily contact with Macron, uh Meloni, and Starmer.

[08:14] Okay. What else have they got? Let me see here. I told the US president that we and Ukraine will be directly involved in negotiating security guarantees when the time comes. Okay.

[08:27] United States and Europe need to quickly increase the pressure on Russia together. Okay. They need to also increase pressure on Russia. Um These comments probably come after uh

[08:42] These comments probably come after uh Trump softened oil sanctions on Russia. It's not a surprise. Uh You're basically fueling the Iran war is basically making Russia

[08:57] And and giving them more money for And and giving them more money for competing with uh Ukraine.

[09:16] China agreed to postpone Trump visit. I mean, I don't know what real choice they have. White House. Let's see. We'll get dates as soon as we can find

[09:32] said here. White House Trump has full confidence in counter investigator underway into leakers in administration. Counterterrorism official who was who resigned was not involved in Iran negotiations.

[09:45] Uh yeah, this is obviously a big you know, political issue. Counterterrorism a lead resigned suggesting no threat to US from Iran Uh suggested this is to help Israel. Um

[10:05] Uh suggested this is to help Israel. Um We've got White House says he was not involved in Iran. Okay, so they're obviously trying to downplay his impact. IAEA,

[10:19] IAEA, okay. This is also interesting. IAEA do not know the status not know the status of highly enriched uranium. Qatar [snorts]

[10:41] Qatar calls this an escalation. Uh so this was the South Pars. Uh so this was the South Pars. Uh South Pars gas field. Okay, Israel Israel strikes South Pars.

[10:57] Israel strikes South Pars. Qatar is frustrated by this escalation. Qatar is frustrated by this escalation. Uh Iran vows retaliation. Uh Iran vows retaliation. And

[11:20] underground in a nuclear complex. Well, that's not great. More of this crap. More of this crap. Okay.

[11:37] evacuation orders for several energy facilities. Uh great. Uh issued evacuation orders for several energy facilities.

[11:50] This was just all within the last you know, little bit here. Uh across Gulf, which isn't great because across Gulf, which isn't great because that's escalatory for oil.

[12:14] must work to end war ASAP. Yep, we know. Okay. Those were just some of the headlines that just came through.

[12:30] Russia, let's see here. Blah blah blah blah blah. Okay. Got it. So, little bit of a geopolitical update Send that through. Remember you can read these notes in the Meet Kevin app.

[12:44] Okay, it looks like we've got the Qs trying to recover a little bit, staging a bit of a recovery here, which is good. Uh Q Yeah, look at that right off 600. Now 600 is a you know, pretty famous pretty famous spot here where we like

[12:59] bouncing off of. It's way less powerful. As you can see it's just a green line and the purple line is at 607 and 595. Uh it'll be I'll be very curious to see how we move once the summary of economic

[13:15] projections and Powell's actual commentary come out. I think that's about. That's the movement we care about. Usually what we find is this about. Usually what we find is this early morning movement just doesn't last

[13:28] early morning movement just doesn't last uh long. But we'll see. Tom from for the US to dive into recession, I believe it takes longer to come out. Yeah, I mean that's an interesting argument that that essentially you know,

[13:41] argument that that essentially you know, the longer it we forestall a recession, the more we're basically donking with the natural state of the economy and and the more we actually make things worse, which means it takes even longer to come

[13:54] which means it takes even longer to come out of it. Yeah, that that is a scary This you know, if we do have a recession, I'm concerned that it will take very long to come out of it because we do have

[14:07] artificial intelligence that will you know, during this cycle in my opinion have the boot on the neck of employment. And that makes it very hard to actually come out of a recession because usually

[14:20] when you come out of a recession you're relying on job growth. Uh and um Yeah, that's not great. Yeah, that's not great. So, anyway, okay. Let's see here. Isn't

[14:34] that Yeah, there've been a lot of rumors around BB. You know, did BB get killed? You know, so far a lot of it it just seems to be yapping, but you know, there are definitely those rumors circulating. Nearly 3/4 of February's broad basing

[14:48] Chris can be traced to prices for final demand less transportation, warehousing and trade. Okay, so so what's left? If you take out trade transportation, warehousing and trade services Uh-huh. Okay. 20% was due to traveler

[15:03] accommodation services. Alcohol then then you had alcohol uh alcohol wholesaling securities brokering, investment advice and related services

[15:19] and related services also rose. service items that moved.

[15:31] All right, let's try to write that down Uh so Uh so bank Okay. Let me see what the uh Bank of Canada has.

[15:46] Because that could be a little bit of a heads-up on what Powell does, right? Because they all talk together. Bank of Canada says Uh there we go. Bank of Canada too early to

[15:59] there we go. Bank of Canada too early to assess impact of uh Iran conflict. have tightened. Uh high uncertainty

[16:14] high uncertainty and boosting of global inflation in near term. weaker. Recent data suggests Canadian growth

[16:28] Recent data suggests Canadian growth will be weaker. Rates held stable. will be weaker. Rates held stable. Uh rates held at 2.25%. Okay, I don't think this is going to be too different from what we hear from

[16:40] Powell today. But that's the Bank of Canada. That statement was just released about 60 seconds ago. So we got that in the Meet Kevin app there. Remember that's free for you to download over on the Apple or Android app store. And you

[16:54] videos that I post. So if you're like, I only want your Fed videos, Kevin, or I only want you know, your live streams or this that or whatever, you can customize that however you'd like. Somebody says uh Putin is laughing right now. Yeah, no

[17:07] kidding. Uh Donny is pleasing BB. Yep. BB and Jared Kushner sitting in a tree. help us make make Palestine great again? We're going to build all that coastal real estate on the Mediterranean.

[17:23] Uh so gas $5 by Friday? Well, you must not live in California. >> Uh somebody says how I don't see how we are not in a recession already. you know, remember it takes the NBER, the National I think that stands for the

[17:37] National Bureau of Economic Research. Takes them about recession. Uh like you know, by then you're you're usually

[17:49] already knee-deep in it. Like they typically in the official definition of is called quite late. Um but it does you know, our first little warning really big warning sign of that was that

[18:01] negative jobs report for February. That's that's a really big red flag. That one's not great. Uh okay, so let's just throw this under jobs recession just because inflation

[18:15] affects the jobs recession because it you know, prevents the Fed from uh reducing rates. And let's throw in that PPI today. And let's throw in that PPI today. Uh third straight increase

[18:28] Uh third straight increase third straight increase in final demands services. This was uh led to 75% of increase in PPI.

[18:44] We had traveler accommodation services up 20% in Feb. You know, that doesn't sound recessionary, right? Uh that doesn't sound recessionary. Sounds inflationary.

[18:59] Then we've got uh uh alcohol wholesaling, securities alcohol wholesaling, securities uh investment advice

[19:12] What was this? related services, fuels fuels, lubricants um motor carrying

[19:24] and inpatient inpatient care also rose. And then we had what was down? Down was down apparel footwear

[19:40] accessories retailing. Uh some goods. Okay. What else do we have in the report? I think that's pretty well it.

[19:52] energy. That's fine. We know that's going to happen. Okay.

[20:04] Oops. Uh uh oh, double M. Okay. So, PPI then let's just make a note here about how 0.3 expectation, 0.7 reality up from 0.5% last read.

[20:22] And then if we go Uh let me just see here.

[20:36] food energy 0.5 at 0.5. All of them at 0.5. 0.5 X Um 0.3% expectation, 0.5% reality X food

[20:50] and energy. And then uh basically the same thing uh for trade. Food Food energy and trade. All right.

[21:03] So, we got that data. Uh somebody here writes, "The way I Squared. have to look at that. "The way I fantasize this recession, everybody gets

[21:17] fired. The only stuff making money will be those AI winners. So, whether you are in a recession will be a question of whether you have invested." Uh

[21:32] know, let the AI winners run. Well, you typically there's a recession the entire market just corrects and sells off, right? There's really no there's really no hiding in the stock market. You know, you hide in cash. Uh recessions are

[21:46] often deflationary and uh that's to asset prices as well. You know, opportunities to borrow are created. But yeah, I mean, AI winners will will will keep winning. Uh okay, fine. So, when is Rock meeting?

[22:01] You mean Powell? That's at 11:00 a.m. today. So, we still got another 4 hours before Poway Wowie. Brent still holding on to that 108. Not great. Let's go. Yeah, so that early morning kind of enthusiasm already starting to wane a

[22:17] little bit on the cues. This is not uncommon by the way. Lately we've had this sort of retail buy the dipping for the first 15 to sometimes 30 minutes. And it just doesn't last. It just almost always burns off. It's like a marine

[22:32] layer that comes in. It's a it's a marine layer of enthusiasm. And then the kidding. It's going to burn down. So, what do we have here? Israel is hunting down Iranian regime members in their hideouts one by one.

[22:45] their hideouts one by one. Mhm. Trump advisers circle the wagons. Uh uh signs of dissent over Iran emerge. This

[22:57] probably has to do with a resignation. Visual guide the attack on Iran. We might scroll through that. Take a look at that. Powell's Oh, not this guy. The Trevor Milton fraud. Pardoned for fraud.

[23:13] fraud. Pardoned for fraud. We can trust you now, right? Right. Yeah, I I just can't believe you you donate $2 million for Trump to Trump. back at trying to raise money from retail.

[23:28] That's nuts. Uh Powell's second to last meeting previews an increasingly divided Fed. Uh yeah. It's going to be really hard Uh yeah. It's going to be really hard for Wurst to do anything.

[23:45] Yeah, that's interesting. Somebody says K-shaped recession, huh? in a real recession. Uh Uh So

[24:00] recovery from academy. Okay. Uh job. That's right. Yeah. No, yeah, current housing legislation doesn't affect House Hack at all. Um

[24:15] And and that's I I I honestly think it's also going to stall out in the Senate. I don't think the House is picking it up. Uh at least that's you know, the current commentary. Mostly because Trump isn't heavily focused right now on housing

[24:29] policy. Uh you know, he's issued a few executive orders, but he's so focused right now on Iran. Uh and then come midterms, nothing's going to change. You sign another legislation until the SAVE Act gets passed. So, there's there's

[24:41] work to be done on that. And if you want to know about the the real estate one, you really have to watch for this first, the SAVE Act. Which we can take a quick the SAVE Act. Which we can take a quick look at the SAVE Act.

[24:55] President Trump says the legislation is salvation for voter fraud. Uh Chuck Schumer says this is uh an effort of mass voter impri- you know, the suppression. Neither is a reality. Yeah, I agree that neither is is a

[25:10] reality. Uh you know, I I don't mind showing ID. You know, I think everybody should should show ID to vote. But, you know, people have frequently argued, "Oh, that disadvantages poorer people." Then I'm

[25:22] like, "Then give them free IDs." You know? Then then then make an ID free And then all you have to do is go to the DMV or apply online or whatever to get your ID. Like it's not that hard. And just subsidize the cost of getting

[25:35] the ID, right? Anyway. Uh Republicans don't have the votes to clear the Senate filibuster. Right, that's that's the problem right here. So, Donald Trump does not want to sign any legislation, he said. You know, who knows? Maybe

[25:48] maybe he's going to change his opinion. I mean, Donald Trump I kind of I I saw this commentary the I don't know where I saw it. But Donald Trump doesn't have um what seems to be a very cohesive plan uh

[26:04] for what the hell he's doing. Like a lot of it just feels very fly-by-night. Some people say, "Oh, no, it's all part of a master plan." I don't really think so. Uh and so, I'm you know, my thinking

[26:18] more is that you know, he he's probably right when he comes up with this idea until the SAVE Act passes. Okay, well, the SAVE Act they don't have the votes. Uh so, really in order to pass

[26:33] what what is the Senate right now? Let me see what the Senate positioning is. Senate uh United States. All right. So US Senate right now, we are sitting at

[26:48] 53 Republicans. So, you need seven Democrats to get legislation passed. And and Democrats typically aren't going to go for the SAVE Act. So, you know, we might be done with legislation. Uh I mean, let's let's write that down.

[27:03] So, we have a politics section here. Uh >> [clears throat] >> Congress. So, Trump Trump threatens not to pass any bills until the SAVE Act

[27:18] until the SAVE Act is passed. Uh voter ID. uh SAVE can't get through can't get through uh filibuster. Also can't be attached

[27:32] Well, I mean, I guess it could be, but um I mean, arguable. Also unclear if it could be arguable. Also unclear if it could be attached to a reconciliation bill uh

[27:44] only requiring 51 votes. Um finance. So, they'd have to play games there. And and I don't think they're So, uh this suggests

[28:05] pass this year anymore. Uh suggests a lot Uh suggests a lot a lot like SAVE Act and housing plans, a lot like SAVE Act and housing plans, etc. May stall out in Senate.

[28:23] There we go. Try to keep that consistent. Okay, so uh we can cite the filibuster

[28:36] People registering to vote would be asked to show proof of US citizenship such as passport, birth certificate, or naturalization document Many driver's license Oh, driver's license wouldn't qualify. Interesting. I

[28:50] actually thought a driver's license would would qualify. So, I'm going to write that down. Driver's license would not uh would not qualify. Must show not uh would not qualify. Must show birth cert, passport, or naturalization

[29:05] doc to vote. Uh and I think they'd also kill some of the vote by mail, which you know, I don't mind dropping off my ballot in the little box. I generally don't mail mine. I go drop it off and I find that very

[29:17] line. But anyway, uh enhanced driver's license do show citizenship, but that can be used across borders. Uh let's see. Real ID. Let's see. Might not have a problem, but Americans

[29:30] um okay, I'm going to write Real ID might Real ID might. So, to be determined. Uh let's see here. House bill second piece, national voter ID blah blah blah

[29:43] under the GOP blah blah blah blah blah reasonable efforts. Trump wants to reasonable efforts. Trump wants to expand the Save Act. Yeah, okay. But I mean it's essentially stuck right now.

[29:55] And this is just some commentary. Let me see what what the commentary here is. Voter fraud is exceedingly rare. As the issue of non-citizens casting of identifying people who aren't eligible blah blah blah. Time for the

[30:09] elephant in the room that is Donald Trump's extensive attempt to overturn an election that he lost. All right, enough of this nonsense. I political stuff. Uh let's go see what we got here. Yeah, Q's not really going

[30:24] anywhere. It's trying though. Circle's still killing it. Uh this was one of our you know big calls in the um Meet Kevin membership over here in the We were like 68 bucks when we went shopping for this one. So this was this

[30:38] one's been a two-bagger, which is pretty nice. Uh big fan of of Circle. Uh unclear how much of it is momentum versus uh fundamental right strong fundamentals. Tesla is on the move a little bit. Yeah,

[30:52] Very nice. Uh so Sammy he Lee says going to dump in lot of that's going to depend on what Powell says. You know, we have a we have

[31:04] morning, which remember you can still join it over at meetkevin.com and see the game plan. But a lot of it is going to come down to what happens uh with exactly what Powell says. So I you know, wait I think

[31:17] waiting to trade until 11:00 and 11:30-ish is is the time. Uh oh, we do have data coming out right Let me just pull it really quick here. So we have

[31:36] matches the survey ex-transportation 0.4% so a little better outside of transportation. Not great for cars, but good for others. Durable good orders good for others. Durable good orders flat at zero. Ex-transportation 0.4 for

[31:48] durables. Okay, so outside of basically autos that's actually pretty decent. Capital good orders coming in at 0.1% versus the survey of zero, which is good and that is non-defense and excluding aircraft. So you know, those could be

[32:03] like artificial intelligence uh you know, equipment um you know, whether those are turbines or you know, whatever right related to uh CapEx spending. Okay, so uh what is this comment here?

[32:21] Okay, so uh what is this comment here? Uh Okay, Russia is talking about this. So Russia says

[32:33] So Russia says Russia says conflict in Iran has no Russia says conflict in Iran has no justification. You've got conflict in Middle East will set global

[32:48] conflict in Middle East will set global trade and economic system back by years, again says Russia. I've got

[33:06] Russia. Okay. So that's just now Oh, Russia I guess got an an LNG tanker. Russian LNG tanker attacked in

[33:20] Mediterranean. Uh they call it terrorism. Okay. So as more energy products are flowing out of Russia, they're becoming more of a target.

[33:34] Uh 53 Republicans right now. We should make a little note of that. make a little note of that. Uh

[33:48] 53 Republicans in Senate needs 60. Okay. Amazon, what's going on with Scamazon? Scamazon is planning to sharply cut the number of packages they send through USPS.

[34:02] Delivered nearly a big 15% of all packages last year. Yeah, but now Amazon trucks are in your neighborhood every day.

[34:14] neighborhood every day. So they really UPS walked away from negotiations on a partnership.

[34:26] much. All right, let's take a look at this. All right, let's take a look at this. Powell's second last meeting.

[34:42] yapping. Let's see what she says. Uh Tulsi Gabbard.

[35:01] There. There we go. Director of US National Intelligence. Director of US National Intelligence. She says Iranian regime intact

[35:16] She says Iranian regime intact regime intact, but largely degraded regime intact, but largely degraded by US military operation.

[35:28] Um in presentation to Senate. proxies and Iran remain capable of attacking US and allies in Middle East.

[35:51] uh regime survives, it will try to rebuild missiles and drone forces. That's what she's saying.

[36:03] That's what she said. Al-Qaeda and ISIS pose big threats. Al-Qaeda Al-Qaeda and Al-Qaeda

[36:17] pose big threats. Uh let's see what else here. Al-Qaeda. I Al- My typing today isn't great. Okay, then I US has seen no effort

[36:34] Okay, then I US has seen no effort to rebuild enrichment. No effort seen to rebuild enrichment. Uh reiterates enrichment obliterated in

[36:48] July or June strikes. You know, but this is Trump's line, right? That's Trump's line though. They totally didn't strike Pickaxe Mountain. And the IAEA just today said Esfahan is

[37:05] And the IAEA just today said Esfahan is up and running again for enrichment. I Do not know the status of the highly enriched uranium new enrichment facility complex. Uh

[37:22] say unclear if they're enriching, but but but there is a nuclear facility. But but but there is a nuclear facility. But there are nuclear facilities left. there are nuclear facilities left. Nuclear facilities left.

[37:35] giving us the the straight here or if this is just uh Uh Russia, China, North Korea, Pakistan Uh Russia, China, North Korea, Pakistan pose nuclear threats to the US.

[37:49] Russia, China, North Korea uh and Pakistan pose nuclear uh and Pakistan pose nuclear threats to the US.

[38:04] America. North Korea is strengthening partnership. Russia has maintained upper hand in Ukraine war. Russia has maintained upper hand in Ukraine war.

[38:18] Ukraine war. And then we've got You Oh, okay, here we go. US assesses that China does not

[38:41] invade Taiwan in 2027. Presumably not this year either. Iranian news agency citing Iranian oil minister some infrastructure of Pars minister some infrastructure of Pars damaged. No injuries reported. Okay.

[38:57] Symbiotic. Uh what do I think under Let's see here. Well, let me look at Symbiotic quickly just to see what their val is Symbiotic. If I sort by Symbiotic, they're

[39:13] If I sort by Symbiotic, they're currently trading for a 1.36 PEG. Closer to fair values now. It's a manufacturer. So obviously uh at a 1.36

[39:29] PEG, it doesn't have terribly much upside. 169 / 1.36. terribly much upside. 169 / 1.36. It's about a 24% potential upside.

[39:41] It's about a 24% potential upside. Uh price them as a servicer because they're contract manufacturer heavily. They margins aren't that great. And then you have the Walmart concentration risk.

[39:54] concentration risk is a plus side. That's That's from our stock app. I was our stock app, which remember you get access to if you join at mekevin.com. you know, the thing to remember about SIM is they sort of

[40:08] buy a bunch of parts from contract manufacturers and assemble them. And uh their margins are okay, not great. The company itself, you know, 85% of their revenues were coming from uh Walmart.

[40:23] And you know, when it ran over 70, I But um its fair value is probably around where it is now. So, you know, for this to really get like be a juicy screaming

[40:37] sort of buy again, you probably have to you know, get under a one peg. Which is another, you know, 30% or so to the downside. So, they could bring it here at this retracement level of like 36, 45. That might be a little bit more

[40:52] could work. SP Co in the chat says, "I don't think this conflict will be short." I kind of agree with you. I kind of agree with you. Uh let's see here.

[41:07] Well, I think we're going to slowly trend towards 120. Unfortunately. Somebody says, "I converted my 65" This is for a different stock. Uh I converted my $65 calls into shares up 100% on the shares. Thanks, Kevin." Says Sammy Lee.

[41:23] Wow, you're double on your shares. That's awesome. That's awesome. Good for you. get it at mekevin.com. The coupon expires tonight. Coupon code

[41:37] The coupon expires tonight. Coupon code expiring soon. Coupon linked below. Uh again. Um increase cuz we've got some new stuff coming out pretty soon. So, we're pretty

[41:51] excited about that. Uh and I think on a daily basis we continue to add more daily basis we continue to add more value to it. But anyway, so Nvidia over here, you know, has Nvidia has been really holding on to the 180s. And I

[42:03] mean, look at this. It's This is like, you know, boring. All right. Let's go to the uh the info. Oh, we were going to look at this Fed piece. All right. Apple cracks down on vibe

[42:17] All right. Apple cracks down on vibe coding apps. Oh, really? Apple has quietly prevented vibe AI vibe coding apps such as replete and vibe other applications from releasing updates on their mobile apps on the App

[42:29] Store unless they make modifications. Oh, interestingly. So, interesting. They're slowly sort of saying, "Hey, we need the quality up, right?" Uh cracked down on emerging potential threat.

[42:44] Blah blah blah. Some vibe code blah blah blah blah blah blah blah blah. Well, no issue with our app. Our app's nicely listed on the Apple and Android app. You can get it for free. All right. So,

[42:58] here? This is Nick Timiraos. Uh we've got uncertainty fueled by the war in Iran is expected to reinforce a broad agreement among most federal officials to sit

[43:10] well, of course. Uh this will make any dissenting votes Powell is close to the end of his term. Divisions at the Fed have been building.

[43:22] culture of near unanimous votes has given way to more dissent, particularly because of the pressure Trump has placed. Yeah, Even if they don't, a split will be plausible.

[43:37] plausible. Mm. Blah blah blah. This is just a little bit of a history into like certain

[43:51] uh individuals. Honestly, none of this matters. I'm just trying to save you the time. Blah blah blah. This is just a history on dissent. This is ridiculously boring. All right. And we're not going to look

[44:03] All right. And we're not going to look at that. Visual guide at the scale of the war. Wow. Look at the uh Israeli strikes, US strikes. US strikes really concentrated here along the um

[44:16] the Gulf. Probably to try to protect the Persian infrastruct- the Gulf infrastructure. Whereas Israel is just trying to go everywhere. Israel don't Seems like the safest place in Iran right now is close to Afghanistan.

[44:33] Somebody says, "What do you think about actually funny. I I didn't think about Tim Cook retiring, but yesterday I had a thought about Tim Cook. Uh I I think Tim Cook is a you know, a substantially

[44:46] Cook is a you know, a substantially weaker CEO than Steve Jobs was. You of throw the furniture around a little bit every so often. And I don't think Tim Cook does that. Uh I don't know. But

[44:59] we've seen a little little bit of a stagnation in how long it's taken Apple to kind of wake up with, you know, Siri and otherwise. Uh so,

[45:12] like big balls in there who can who can actually run the show a little better. I mean, I still like Apple. Don't get me wrong. I think they're a great company, by, you know, Jobs. And I know it sounds like I'm discrediting

[45:26] Tim Cook a lot, but I just don't know. I I I have my skepticisms that he actually you know, the ability to to throw some furniture around. And it's necessary at stagnate. You know, people get complacent and and the business doesn't

[45:41] grow. Yeah, it's bad. Israel has targeted Iranian leaders. We know that. Here's some of the ones that have already been killed. Uh American forces [clears throat] have flown more than 6,500 combat flights,

[45:55] struck more than 7,000 targets, focusing on Iran's military >> [snorts] >> Wow. Uh let's see here. Pentagon officials have said the US

[46:08] campaign is focused on trying Iran can't continue threats. Naval strikes have damaged or destroyed more than 100 Iranian naval vessels.

[46:28] 50,000 Americans deployed over the region.

[46:40] All right. Got it. This is just a little political here after the Joe Kent. Many didn't expect Kent to resign. Many didn't expect Kent to resign. Decision ricocheted. One-page letter.

[46:59] Trump has grown increasingly frustrated in recent days in conversations with his advisers. He has expressed outrage over media coverage of the operation. He's lamented that allies aren't doing more to help the Strait of Hormuz.

[47:14] Uh Some Trump advisers hope that the war will wind down in the coming weeks. "Never heard him so angry in my life," "Never heard him so angry in my life," says Lindsey Graham.

[47:29] maybe a little less enthusiastic about going to war in Iran. Yeah. It doesn't surprise me. Uh

[47:44] I mean, this we have seen. Let's see here. Let me go over here. Let's see here. Let me go over here. Congress. Let's go here. Uh and just say um you know, reports

[47:57] you know, reports of Trump frustrated over allies not helping with uh Hormuz. Vance uh not inclined to

[48:11] uh launch war in Iran. And uh Trump upset And uh Trump upset over media coverage, which he always is.

[48:27] So, let's now go to the information. So, we talked about Apple. What doesn't belong? Okay. Open AI must focus. Boring. What worries is keeping investors up at night? Why?

[48:42] Beijing. Palantir has what Open AI and Anthropic want. Ooh, let's take a look Anthropic want. Ooh, let's take a look at that. What? Government contracts?

[48:54] Ooh, another one we can look at would be Barron's. So, what are they? Palantir has so-called end-to-end software helping customers link organized data. They store in systems such as Snowflake,

[49:09] They store in systems such as Snowflake, SAP, Salesforce, and develop agents that point of their sort of ontological structures. Organizing the data and then finding links between it using many different

[49:24] products. Let's see. Let's see. Uh Democratic war. Well, okay. Okay. So,

[49:39] What's their valuation now? Palantir. So, Palantir they're at 155 on a share price.

[49:51] But, uh let's actually look at uh what their PEG ratio is right now cuz it's it's historically been quite high.

[50:08] Financials. Palantir 1558 divided by 1.31 for the end of the year. We're trading at 119 PE ratio. But, we have growth of 40.9 46

[50:21] ratio. But, we have growth of 40.9 46 49.4 38.7 divided by 4. 43.8. Oh, wow. It's really actually compressed. 155. Hold on. Let me Let me write this down

[50:34] cuz I can't keep these numbers straight. Um Well, I'll just throw it

[50:47] Palantir. Okay. So, EPS Okay. So, EPS projection on Palantir is a buck 31. And then forecast growth. So, 155

[51:04] 155 divided by a buck 31. That is 118 PE. That's going to be like a three PEG. Wow, the growth forecast have really come up though. Uh forecast growth for come up though. Uh forecast growth for Wall Street next 4 years is

[51:22] 40.9 46.2 38.7 equals

[51:42] If I divide that by four, I get 43.8. Which means they have a PEG ratio of 118 divided by 43.8.

[51:57] 118 divided by 43.8. Wow, 2.69. That's crazy. This is the first time first time I've seen uh Palantir at exactly a fair price uh based on

[52:12] a fair price uh based on um uh a projected doubling of EPS in 2026. Already priced

[52:25] doubling of EPS in 2026. Already priced that in. And uh 43% growth of EPS each year over the next 4 years. year over the next 4 years. That's impressive.

[52:39] Very good. So, somebody says Yahoo has Palantir at you have to be careful when when you look at uh other people's PEG ratios. Some people are going to use the trailing 12 months of EPS forecast. I

[52:55] use the end of the current year as a forecast. Uh so, you know, that's why you're going to get some variation uh in the uh the PEG ratios.

[53:07] But, uh it's actually impressive. Yeah, it's uh it's actually um it's actually really compressed its valuation. I mean, they have come down.

[53:23] Uh let's see here. Let's see. If we go Yeah, I mean, we've come down from that 207 level. We were down at 130 there for a minute. And the Qs are now falling. Yeah, going

[53:36] back to about 600. This is very normal pre-Powell. Uh you know, this is uh this in the uh course member live stream before we went to our market open stream

[53:48] here. Said there's no point. There's no point to trying to trade the upside until Powell. Uh because the market usually sells off after 30 to 40 minutes of people buying the dip. The

[54:02] market goes down. And so, if you really want to play upside you need to wait for certain things to happen at at the Fed at 11:00 or 11:30. Uh and then you're either going to bounce off 600 or 595, right? So, I

[54:17] mean, we'll see. Somebody said partnership with Microsoft. Most mispriced stock ever. Yeah, well, people are worried about like Nvidia and open claw and all this

[54:30] sort of crap. Uh you know, people still value the um value the um uh you know deterministic agentic solutions that UiPath provides. And And that's why you're seeing more spending

[54:43] by big enterprises, companies like Microsoft. Uh and uh and their revenues, you know, have really bottomed out. Uh you know, if you go I mean, go look. Let's go look. Let's look at it together here. If you go to UiPath investor

[54:58] relations. I mean, how hard is it to look up the numbers, right? It's not. So, let's go to an SEC filing. I should I let's go to an SEC filing. I should I have a current report from a week ago.

[55:10] What's in that? Oh, yeah. Okay. I financials here. Oh, yeah. Okay. I financials here. Let's download this puppy. Let's download this puppy. I'm getting the pinwheel.

[55:24] we're going to put this in as uh UiPath 8K earnings 8K earnings 31826. what we got on UiPath's number on the numbers, honey. The numbers, honey.

[55:40] All right. So, uh first on their outlook over here. For the first quarter, they expect revenue to be around 395 to 4. ARR to be

[55:56] revenue to be around 395 to 4. ARR to be around 1.9. Okay. So, Okay. So, if I go look at revs over here for 12

[56:10] months they're forecasting revenue growth up to 1.9. And they're at 1.610 now. You know, And they're at 1.610 now. You know, UiPath

[56:26] you know, by early 2027 thinks they'll be at 18% higher on revenue per forecast. So, they're they're still expecting revenue growth here. And if you look at total revenue, total revenue on the three month

[56:39] year-over-year is up 13.7%. growth accelerating, not declining. You know, so so here's a

[56:56] business, for example, that has a strong balance sheet. I mean, what do we have in liabilities here? I've got uh total liabilities. A lot of this is deferred. Deferred of 600. Deferred non-con 700. I've got maybe 400

[57:14] in bills. 400 mil bills. Outside of deferred, which only matter if you're going bankrupt. I've got cash and marketables of and marketables of uh what is that? 6151471

[57:34] cash, baby. Look at that. They've got a billion dollars of free cash. I've got 13.7% year-over-year revenue growth, but I've got, you know, management thinking they're going to grow at 18%. I've got uh gross profit 407 divided by

[57:52] 359. I've got gross profit up uh or um 13.3% increase in gross profit, which is yeah, I call stable-ish ish on margins here. But, if I look at

[58:06] operating, that's gross. So, if I look at operating expenses, 326.8 divided by 3.25.5 Uh OpEx only up 0.3%.

[58:20] Uh that's that's big peepee, right? Growing revenue without having to spend more on the business. You know, this is uh this is great. So, what's the valuation of this puppy? So, this guy

[58:36] of this puppy? So, this guy if I go look at PATH if I go look at PATH PATH

[58:56] PATH sits at uh 80 cents Jan 27. 80 cent uh EPS. Which the stock's obviously come down. Oh, there go the Qs. Just lost 600. PATH is at 12.14. 600. PATH is at 12.14. So, 12.14 divided by 0.8 equals it's

[59:10] trading for 15 times EPS.

[59:23] EPS growth forecast for this puppy I've got at 11.7 10.8 5.8 got at 11.7 10.8 5.8 21 49.3.

[59:35] 21 49.3. divided by 4 equals 12, 15.175 divided by 12.3 2 2 5 equals I was trading for 123 PEG.

[59:47] So, you know, that's not bad. You know, that's that's pretty good. to 500 million to buy cheap shares. Yeah, and of course they're buying back shares as well because that's I mean, they've got so much cash.

[1:00:01] Uh but let me verify that. Uh I could see that on the cash flow statement here. Cash flow, I've got repurchases of common shares, $329 million. Yeah.

[1:00:15] as well. So, you know, not bad. So, you know, not bad. Cheap valuation and uh expected to grow quite a bit here. The Palantizzle

[1:00:30] in here. here. Palantir.

[1:00:44] So, for Palantir, we just said valuation is actually fair now because EPS is projected to double this year.

[1:01:00] And growth is expected to be 43.8 per Wall Street, which is these estimates or what, but those those are very impressive numbers. are very impressive numbers. And

[1:01:20] Okay, let me see what the prior was on Palantir. Okay. Palantir. So, prior, right. So, prior growth expectation was 52 uh averaged out over the four years. So,

[1:01:36] that's probably actually pretty similar. The it's just this doubling of EPS that's really helping collapse their valuation from like the fours. And still strong growth going forward.

[1:01:50] So, we're going to update that. Share the screen here in just a sec. This is uh I'm going to throw that quickly into Palantir. Yeah, yeah, exactly. So, the calculator is also showing 2.69. So, that's exactly

[1:02:05] what we came up with. And then let's throw in the Reddit notes. We Or so, not Reddit. The we did that this morning. Let's throw in the UiPath numbers really quick as well as just the

[1:02:19] quick comment on this. So, UiPath seems uh well, UiPath is growing year over year

[1:02:36] at 13.7% uh but management uh but management forecasts 18% growth going forward. The um strong balance sheet

[1:02:50] um weak momentum uh growing pricing power uh margins and

[1:03:03] uh low val low valuation. Okay, then we have Okay, then we have OpEx basically flat despite revenue growth suggests uh scaling

[1:03:16] and higher EPS to come. Which is great. All right, let's slap that in. So, we have that in our little tab here as

[1:03:28] well. Here we go. Uh indicated here is a 1.34 PEG. Oh, my math was 123. That's pretty close. Okay, so what else do we have here? Okay, so what else do we have here? Uh then you've got

[1:03:42] Uh then you've got where are the Qs? Qs trying to get back to 600 here. And it looks like Brent right now is at

[1:03:57] about 109. NATO allies are Oh, well, that looks that's an that's an interesting note. Uh there's a note here that NATO allies are discussing how I don't know if that's going to mean

[1:04:11] anything uh to reopen the strait. Uh allies discussing how to reopen the strait.

[1:04:25] Uh un- unclear this actually implies action. it's nice to the Europeans and NATO countries to talk about it.

[1:04:45] Info Let's go to the FT today. take a quick look at gold. Yeah, yeah, yeah, yeah, we're almost at 110. So,

[1:04:57] down on that. Yeah, look at even gold and silver fall Yeah, look at even gold and silver fall here. I mean, we called the top on gold and silver January 30th and uh

[1:05:12] I think I was 2 days 2 days early on it. But uh I mean, we're way down from But uh I mean, we're way down from there. Don't even look at silver from January 30th.

[1:05:28] Silver Well, I think it's high was 117. So, 76 Well, I think it's high was 117. So, 76 / 117. Yeah, 35%. Right in the middle of Well, what are you going to do?

[1:05:42] Microsoft weighs legal action over Amazon OpenAI cloud deal, whatever. Iran wild west. Kirkland defies private equity downturn. $11 million partner pay. Oh, that's

[1:05:56] cute. Okay, what else? blah. AI craze claws in China. Yeah, whatever.

[1:06:11] Boring. Uh come on, FT. Oh, yeah, we should look at this drone company because it's got yapping about that one a little bit yesterday.

[1:06:24] Uh and then of course the Qualtrics deal from JP Morgan, that falling apart was a from JP Morgan, that falling apart was a red flag for private credit.

[1:06:36] some of these. So, first here Here's new. Gold and oil inflation warnings, oil is Gold and oil inflation warnings, oil is almost up 50%.

[1:06:56] Yesterday. indications on Wednesday that wholesale prices had jumped. Oh, this has been updated today. Okay. Larger upside surprise in PPI.

[1:07:11] US economy expanded at 0.7% annualized clip in the final uh clip in the final of 24. Yeah, but a lot of that is probably due to the shutdown. So, you'll probably get a rebound. Let me look if Atlanta Fed's already calculating one.

[1:07:34] This is why it's important to understand the components of formulas, right? Somebody here says Grok puts the PEG of path at like 0.43. Somebody else says Claude has it at a 2.3. It's dependent on what data you're using. So, are you

[1:07:47] using the trailing 12? You know, if you go tell those AI bots that the Wall Street forecast for EPS is 80 cents for January of 2027.

[1:08:00] Uh and then the next 4 years growth forecast are 11.7, 10.8, 5.8, and 21. And then have it calculated and it'll show up exactly the way we have it. Uh but anyway, here's the Atlanta Fed real GDP

[1:08:16] here's the Atlanta Fed real GDP indicator sitting at 2.7 right now Q1. Oh, they got rid of their commentary. Oh, they got rid of their commentary. Yeah, what the hell?

[1:08:31] They used to have a big commentary box here. Well, that's lame. I kind of like the commentary box. Hassett Yeah, Kevin Hassett does it Whatever he says, I don't listen to.

[1:08:46] Whatever he says, I don't listen to. Uh let's see. longer before core PCE falls to its 2% goal.

[1:09:07] say it will take until at least the first half of 2028 crazy. That's not great. aren't really pricing that right now. Where are the Qs right now?

[1:09:23] Qs Oh, yeah, down 6/10. Okay, let's write that down. See, that's interesting. So, go over here to Fed Financial Times uh economists.

[1:09:39] uh economists. So,

[1:09:53] uh economists believe Fed will wait until core PC back to 2% to cut rates. Uh they believe it could take as long as they believe it could take as long as the first half of 2028 for that to

[1:10:08] the first half of 2028 for that to occur. This means markets have to implies markets have to deal with no rate cuts until well, for 2 years. Wow, that'd be depressing.

[1:10:28] Yeah. Very interesting.

[1:10:40] hold. Yeah, we already know that. We know they're going to hold. That's not a surprise. All right, what else do we have here? That's the FT headline page. Nothing here. Okay, what do we got here? Drone

[1:10:53] company. Okay, let's look at Look at this. So, this was a company called Swarmor. And I guess it had a pretty decent IPO. Oh, it's up again today. Yeah, look at that.

[1:11:09] So, yesterday we closed at about 34. It's up again today. So, you're getting some major momentum out of this uh drone play major momentum out of this uh drone play here. This is a $500 million company

[1:11:23] Let's go uh let's go see some financials on this uh this homie. Uh okay, so this is going to be Swarmor Uh okay, so this is going to be Swarmor drone investor relations.

[1:11:44] Swarmor. There we go.

[1:11:57] Yay. We have drones. cares? I mean, anybody can have I mean, there are apps you can have on the iPhone that'll make your drones autonomous and

[1:12:10] you know, the way you want them to. But um where is the investor relations page? Swarmor investor relations.

[1:12:36] Is this it? IPO price? Yeah, I think this is it. All right, here we go. So, let's download this puppy. So, this is Swarmor drone.

[1:12:49] This is probably an S-1. IPO docs. All right. Let's see if they actually make money. Let's see if they actually make money. They probably don't.

[1:13:08] You got to mispronounce it. It makes it more fun. So, here we go. >> [snorts] >> Okay, take a look at this. So,

[1:13:21] is this in This is not even in millions. This is not even in millions. Oh, man. Are you kidding me? Revenue

[1:13:40] thousand dollars. That's it. Not million. Literally six figures. Some of you watching make more than this company in a year. Uh their cost of revenue was about half

[1:13:55] of that, 182. So, their their actual margin is like 41%. 41% gross margin. Oh, man, look at the

[1:14:08] 41% gross margin. Oh, man, look at the op ex. 5 million, 5.2 million op ex. RIP. So, they don't sell anything. So, they don't sell anything. And they're losing money hand over fist.

[1:14:25] They spent $1.7 million dollars to go public.

[1:14:39] R&G R&D R&D 1.4 million on consulting and professional fees. Okay. How many employees do they have? Employees.

[1:14:58] 62 full-time employees and 60 contractors. Look at this. 52 employees are employed by Autonomous

[1:15:12] 52 employees are employed by Autonomous Robotic Systems LLC in Ukraine. They literally have 10 employees stateside. Wow, that's crazy. So,

[1:15:25] So, that's actually really interesting. Uh 10 employees stateside, 52 in Ukraine.

[1:15:38] 10 employees stateside, 52 in Ukraine. Okay. really look at it, but like a balance sheet would be nice, too. And they probably just raised some money by going public.

[1:15:54] But some more financial statements would be nice.

[1:16:08] Uh No balance sheet? No, here we go. 9.2 in cash. Oh, that's all right. So, not too much

[1:16:21] in liabilities. 9.2 mil cash versus 1.2 mil expenses. Not bad. So, they have money and this is before their IPO. before their IPO. Uh will have raised more as well.

[1:16:42] And then cash flows are obviously largely negative. Wow. Wait, where did they raise money here? This is convertible preferred stock and commons.

[1:16:56] dollars worth of uh shares before going public. shares before going public. Interesting. So, yeah, I mean, no uh no real proof of uh concept here what they're selling. Small biz, eh?

[1:17:13] Oh, yeah, when does the lockup end? Yeah, no kidding. Great question. Yeah, no kidding. Great question. Lockup. 1% of the shares immediately after

[1:17:34] Okay. Uh

[1:17:47] people who are not affiliates.

[1:18:01] If I'm skimming this correctly, you're looking at about 90 days. Uh expiration lockup agreements and within

[1:18:13] of our common stock does not exceed the greater of Oh, I see. 1% outstanding. And then average Okay, so some limits on how many I can be sold, but really 90 days.

[1:18:27] And then here affiliates are going to be 6 months. So, lockup 90 days non-affiliates, 180 days affiliates

[1:18:43] uh with some requirements on volume. requirements on volume. Right? So, it's not so overwhelming. Yeah, that's crazy. Yeah, that's why And it you know, I

[1:18:56] it's purely momentum right now. It's certainly not fundamentals with how much interesting. Uh I wonder I mean, they probably put a small float out. But uh yeah, it's definitely moving.

[1:19:10] definitely moving. So, Qs maintain under six here. Okay, what else? Let's see here.

[1:19:45] a surprise. We know that. Oil prices surge. Nvidia has become a boring value stock. I'll have to look at that in a bit.

[1:20:08] 17. It's definitely come down from its 30. Let's see if that even held. Cuz sometimes what happens is they'll

[1:20:23] pop and then they just fall right back down. at that from 107. Down more than 50%.

[1:20:43] Uh, okay. to have to do with the full stack autonomy.

[1:20:59] Herculean spec or a task.

[1:21:11] failed. Ooh. Ooh. Let's take a look at this. A darn paywall. It's all right.

[1:21:26] Here we go. Kevin Warsh likes to tell a story that explains why he would remake the Fed from top to bottom if Trump chooses him, which he did.

[1:21:41] which he did. Uh, this is an old piece. there. Nvidia has become a boring value stock. Let's see. Yeah, I think Nvidia's valuation is pretty low right now.

[1:21:58] valuation is pretty low right now. Let me go look in the Meet Kevin app. Let's see what we got them at. So, Nvidia 1.62

[1:22:21] So, I mean, for their margins, that's pretty cheap. They should be at 16 or 269, so 162 It's

[1:22:33] They should be at 16 or 269, so 162 It's a 66% upside in Nvidia. typically trade at a lower price earnings. Nvidia isn't quite there yet.

[1:22:50] Nvidia is acting more like a value stock.

[1:23:03] If Nvidia can emulate that, shareholders will be rewarded even though it's not quite explosive gains are Okay, whatever. Yeah, I mean, I I don't I don't think Nvidia is a bad company at all. I think

[1:23:15] insane. I mean, they're some of the best in the industry. I mean, really in the stock market, you could say. Uh, Tesla came back down. I mean, everything sort of moved down after the

[1:23:27] morning hype. Yeah, you get people coming in trading in the morning and they're trading too early. They're going in without a strategy. we do the Alpha report every morning like, "Hey, you know, be careful. Don't

[1:23:43] fall into this trap. Look for this." And here's a strategy. You know, it Okay. Good. So, what else?

[1:23:56] Then we've got Let's turn on some tea. Let's go back to the journal for a moment.

[1:24:08] Okay, we saw this. Oh, let's actually go to the time.

[1:24:21] Lebanon. Interesting. Trying to get the Who are we trying to Trying to get the Who are we trying to get out there? Hezbollah?

[1:24:33] campaign against Hezbollah. Yeah.

[1:24:46] start of the war. At least 10 people were killed. At least 10 people were killed. Wow.

[1:24:58] building go. That's crazy. I want to see that again. That was wild. Let's see if it replays it. It's the bombs just dropped all the way through the building, hit the bottom. WOW.

[1:25:34] That's nuts. There it is and then there it isn't.

[1:25:47] Yeah. And And the thing is about these, there are no fundamentals here, but the momentum can probably keep going for a while. I mean, $650 million market cap, you know, I've seen companies like this they they pretty

[1:26:02] easily get to like 1 to 2 billion dollars in market cap, which, you know, dollars in market cap, which, you know, that's still a two or three X from here. So, if you play these, you really have to play You probably have to have like a

[1:26:17] 20% trailing stop on this. Uh, and then you hope that it runs up. you know, that's all this is right now is a low float meme and the problem is

[1:26:30] that when you try to get out, uh, you want to make sure you have, you know, enough available liquidity, so you don't want to go in with such a big position. You know, if uh, you know, somebody with a lot of money to invest went in on

[1:26:42] the stock too much. They'd get really bad price going in. They'd get a really bad price going in. They'd get a really bad price going out. Uh, it looks like a Yeah. Yeah, Ubiquity looks like it's about to,

[1:26:55] uh, pop. I'm Lebanese. They evacuate before we receive 2-hour call from the idea of Oh, interesting. Okay. I mean, that makes sense why only It was still 10 though. It's a

[1:27:07] It's a lot. But, uh, yeah, Ubiquity is an interesting one. It's really, um, there to the fives and it's right back up. This is another big one in our on

[1:27:19] our Meet Kevin Alpha list. for Ubiquity. It's just such an impressive company. Also great great

[1:27:31] pricing power, honestly. Regularly sold out of fantastic products. Just another Okay. So, uh, let's see here. Let's go to Let's

[1:27:45] see if Axios has anything else. Axios Axios What's the AI spending flop?

[1:28:07] What is this? Anthropic is now capturing third 73% of all spending amongst companies buying AI tools for the first time. Wow.

[1:28:22] AI race is shifting from best model to who can monetize it the best.

[1:28:35] big companies to buy your product or your service, really. There's so much money to be made in that. You know, that's really where, uh,

[1:28:47] it's sort of like UiPath. You know, you want those bigger customers that spend more per, uh, you know, contract than a bunch of

[1:29:00] low-end contracts. It's one of the things, you know, we're looking at with our with our valuation AI at House Hack. Part of Part of one of the things I'm thinking about is eventually closing the

[1:29:14] ability for people to buy it at all uh, and then only enabling uh whether you're an agent or a broker as some form of like business-to-business product.

[1:29:28] That's the Reinvest AI, you know, valuation tool. Just because we think when this comes out in Q2, it's going to be so good that we're going to be able to to sell it for a lot to businesses. Uh which makes this pretty exciting uh

[1:29:42] But, I mean, you're seeing that with these big AI companies as well. these big AI companies as well. So, Cody's talking about 25% short float Yeah. Okay, so what else here? Samsung expands

[1:29:59] chip manufacturing. Fine. Okay. Yeah, concentration risk does go up when you have fewer larger customers. That is true. Israeli Air Force struck a natural gas processing facility in southwestern Iran.

[1:30:14] Uh for the first time Israel has struck natural gas facilities which are key to Iran's economy. By how much? much? How much revenue Iran from natural gas?

[1:30:33] Uh let's see here.

[1:30:59] We have Iran's energy overview. Uh electricity, no, this is boring. Gas. Here we go. Natural gas.

[1:31:13] Okay, Iran is the first fourth largest crude producer in OPEC and the third largest natural gas producer in the world. Ah, interesting. Second largest natural gas reserve

[1:31:27] Second largest natural gas reserve holder.

[1:31:43] Natural gas and oil accounted for almost all of their primary energy consumption. all of their primary energy consumption. That makes sense.

[1:31:56] Here we go. Iran holds 16% of the world's world's natural gas reserves.

[1:32:25] So, let's write down some of those notes because they are kind of interesting. economy this represents. But,

[1:32:37] But, it's all right. Let's write that down. Iran

[1:32:57] There we go. Iran is the third Was it the third largest? Yeah, yeah, yeah. Third largest natural gas producer

[1:33:12] in the world. Holds about 16% of the world's natural gas reserves.

[1:33:30] Iran government budget Iran's government budget

[1:33:43] And Iran natural gas revenues Iran natural gas revenues uh let's see. Iran

[1:34:06] There we go. Take a look at this. Latest value. Revenue minus production cost natural gas revenue about 8.1 8.8% Wait, is that of GDP? Or of the government's revenues?

[1:34:20] No. Revenue minus production of natural gas cost percent of GDP. gas cost percent of GDP. Wow. in in size here. Well, that's quite interesting.

[1:34:38] So, natural gas has become more important to Iran. important to Iran. Let's write that down. natty gas natty gas the good old Are you a natty?

[1:34:52] You should be a natty. Natural gas has become Natural gas has become a more important source of revenue for Iran. Add a hyphen. And uh

[1:35:08] now representing 8.8% of GDP. Okay. Very interesting. Well, let's cite that. Cite Cite your sources. Uh

[1:35:23] Uh Okay, that would be here. where was the other one? Where was the energy page?

[1:35:37] Here it is. Got it. That was this. Third largest natural gas producer. Boom. Cite. Okay, good.

[1:35:49] Cite. Okay, good. So, now what did the Times have here? Oh, yeah, that was the Hezbollah strike, which is worth mentioning as well. which is worth mentioning as well. Israel ramping up

[1:36:02] Israel ramping up strikes on uh Hezbollah in Beirut. Okay. That's here.

[1:36:21] Have you seen what happened in Gaza will be the same here. That's not great. concern for people, though. If you're in Lebanon.

[1:36:33] If you're in Lebanon. Okay, AI concentration. What is this? It's everywhere. AI is concentrating stocks, bonds, private credit around a single bet. Yeah. I mean, that's actually a great

[1:36:47] argument by Axios as well. Qs are recovering a little bit back to 600. Let recovering a little bit back to 600. Let me go look at that really quick.

[1:37:00] Yeah. Yeah, there we go. Right back on the 600 line. Not bad.

[1:37:16] on this just got halted again. If you went on this and and put a 20% trailing stop in when it was up 69% uh your trailing stops would trigger at 89%, right? And it's now at 92%

[1:37:31] up. So, technically, you'd be in the money even if those

[1:37:46] halts suck, but it is halted right now. This is This is meming. And I think there's a good shot this keeps meming for a while. It is a keeps meming for a while. It is a fundamentally trash, but it's uh I think

[1:37:59] it's pretty low float. Let me see if I could use uh honestly, like AI here honestly, like AI here to tell me

[1:38:13] Uh how much uh stock is actually outstanding. See uh stock is actually outstanding. See float and confirm. Uh lockups. So, we'll I'll let AI run that really

[1:38:28] Cuz uh and I'll fact-check it with the lockups because we already researched the lockups ourselves. Uh okay, so AI is constant Okay, this is the AI concentration. So, pop this into AI

[1:38:44] news. Put our little categories in here. AI concentration. And somebody says any news. Um you're seeing with Iran and then obviously Powell.

[1:38:59] Uh Let me see here. And I've been watching the headlines uh or or I should say the wire services.

[1:39:11] Different from headlines. Uh so Oh, oil import US oil imports from Venezuela double amid Iran war.

[1:39:25] Um Let me look at that. See what's going on over here and I'll come back to the AI news part. Let's see here. Brent near 110.

[1:39:45] Let's go over here. And let's go. Brent now around 110 a barrel.

[1:40:03] Uh US pulled in more from Latin America, Canada fell, diesel surged further. With futures beginning to brush up against their highs from 2022. against their highs from 2022. Uh diesel futures up against highs of

[1:40:16] Uh diesel futures up against highs of 2022 around 430 2022 around 430 a gallon.

[1:40:49] well that's boring. Nothing juicy there. Rand Paul challenges DHS pick on anger issues. Nice. Bank of Canada at Canada

[1:41:01] issues. Nice. Bank of Canada at Canada holds rates. Yep, we expect that.

[1:41:16] Uh oil and gas prices jump as Iran lists Gulf energy targets. Let me see if they've provided any more color on that. Fierce retaliation is warned. Oil and gas prices surged as Iran

[1:41:31] listed energy assets in the region that it would target in response.

[1:41:44] natural gas, a lot of which goes to Turkey and Iraq per Bloomberg. Tehran is now targeting

[1:42:00] targeting uh targeting response. That's going to piss them off.

[1:42:12] South Pars return Okay, where we began. Revolutionary Guard responded publishing a list of energy sites. We saw that. Uh Oh, we actually have the sites here now. Ross

[1:42:28] Ross Laffin refinery. The Mm Mess Mesaieed Mesaieed Petro complex in Qatar.

[1:42:44] Then we've got Samref refinery and Jubail Petro complex in Saudi Arabia. And then we have the All Hawiyah gas

[1:43:00] asset in UAE per Bloomberg.

[1:43:23] And then we did see Trump ditch the appeal to allies. under this NATO section, I should mention that

[1:43:37] mention that Germany, France, Germany, France, Canada, Greece, and Norway have ruled out being involved in operations with US and Israel.

[1:44:03] the Persian Gulf near Hormuz since the conflict began. miles wide, so it's really tough to

[1:44:18] defend against when a you know, giant ship moves through there. Okay, yeah, that intercepted and destroyed two ballistic missiles launched towards the eastern region. Interesting. So that just literally just came out.

[1:44:33] Uh Saudis just per Reuters argued they intercepted two missiles. Okay, so that's good. Uh hopefully that chills out

[1:44:50] uh oil a little bit. Let me see here. Oil eh still sitting at about 109. Okay, and then let me go to Swarmr. Yeah, it's a low float stock. So

[1:45:10] tab. Add new. Uh Swarmr. What is that the ticker on this puppy anyway? Swarmr's open again, opened at 84%. SWMR uh SWMR

[1:45:30] So Swarmr

[1:45:42] Okay. So we saw with Swarmr Swarmr had Well, let's go grab a screeny of it really quick. These were the lockups.

[1:45:55] Then let's go back to their revenues for a let's go back to their revenues for a moment. What we got right here? These were some of their expenses.

[1:46:11] they spent a lot of money. Here we've got income. The employees portion is here.

[1:46:26] Okay. Let's grab a screeny of this. And then their balance sheet is actually not horrible because they just raised a bunch of

[1:46:41] because they just raised a bunch of money.

[1:46:55] Uh yeah, that's before the IPO. Okay, so let's write that down. What do we got? What do we got? Eight Oh, it's already 8:15.

[1:47:08] Oh, it's already 8:15. two >> [snorts] >> five >> five Okay. So

[1:47:26] uh big momentum stock uh lockups big momentum stock uh lockups ups for non-affiliates should be 90 days post yesterday, which if I just do a quick

[1:47:40] quick uh tab here into 90 days from yesterday. 90 days from yesterday would be June 15th. 15th. June 15th, 2026.

[1:47:53] June 15th, 2026. And then we could say the same thing here for Yeah, throw the hyphen in.

[1:48:07] Lockups for affiliates should be 180 days post yesterday, which would be Sept 13th. Sept 13th. This is uh

[1:48:23] you know, massively money losing. massively money losing. Massively a money uh losing business Massively a money uh losing business with 10 stateside employees, 52 in

[1:48:35] Ukraine, and contractors. This fine, you can have a contractors. There's no problem with that. Um you've got likely low float. Okay, this is where we're going to

[1:48:55] the low float. So what do we have here? Okay, uh immediately following IPO, there will be a total of 12 12 million shares outstanding. Uh only 3 million will be freely tradable. Oh my gosh. Okay. Yeah. Uh so

[1:49:11] only 3 million shares publicly tradeable. That's nothing. Can't spell today. Oh.

[1:49:25] Lockups 180. Yeah, but 180 that's for the affiliates. See, I think he got that wrong. Um 94 94 non-affiliates and 180 for affiliates or

[1:49:39] 180 for all. Verify. All right. Let's just see what it comes up with there. But let me verify my the 3 million shares here. Oh yeah, there I mean it's right at the top. Easy. So, 3 million shares. So, 3

[1:49:54] million shares times at it, it's at 108. Now, this is hilarious. Yeah, this is killing it. hilarious. Yeah, this is killing it. Okay, so 3 million shares

[1:50:08] let's just do this. 3 million times 64. 3 million times 64. About 192 of the market cap is public About 192 of the market cap is public right now. The market cap is at 795 now.

[1:50:24] 192 divided by 795. Only about 24% of the market cap is outstanding. Only about 24% of the market cap

[1:50:36] outstanding. Um I in my opinion Um I in my opinion opinion, the company should rush to sell more shares at a high valuation. Uh

[1:50:50] Uh great momentum opportunity uh to 1 billion to 2 billion in valuation.

[1:51:03] Uh but it will it will almost certainly it will almost certainly crash gloriously. Okay. So, so trailing stops are a must. Uh trailing trailing stops are a must.

[1:51:21] It they make no money, right? 309,000 of revenue and declining. 309,000 of revenue and declining. Uh which is frankly pathetic and highly

[1:51:33] That they're just going to blow their capital, right? Kraken freezes multi-billion-dollar IPO plan. Yeah, probably cuz they saw what happened to Gemini.

[1:51:50] to Gemini? Gemini. Isn't that crazy? I mean, they're down at six bucks from

[1:52:05] 46. Yeah, that's down 87%. Yeah, that's down 87%. Crazy. into the stock tab over here. For all those of you in the Meet Kevin

[1:52:20] For all those of you in the Meet Kevin membership, this is in the stock tab. that's also where, you know, all of our other research is on stocks. Q's right back at 600 pre-Powell. Look at that U-turn right there. You can't

[1:52:35] play the bounce until 11. I set it this morning in the alpha report. Don't touch it. Just don't touch it. Be patient. Wait until 11. Wait till late 11:30. When the data comes out. We should make a canal and avoid the

[1:52:48] Strait of Hormuz. Yeah, maybe Elon could just like bore his way through, right? just like bore his way through, right? That'd be cool. world for ignoring them. That's an interesting comment.

[1:53:03] Uh okay. So, So, swarmer keeps going. 108. 108. So, uh oh, it says all.

[1:53:21] what am I missing then with the lockup? Cuz I want to get the lockup right. Maybe I misread it. I thought it had a 90-day. >> [laughter] >> Uh once we've been subject to the public

[1:53:35] days, a person who is not deemed to have been one of months preceding the sales who has beneficially owned at least 6 months. That's fine. They could have held for a while.

[1:53:50] Subject to the lockup and volume provisions. trust me, aggregated. Is entitled to sell those shares.

[1:54:12] But you maybe I'm too dumb to figure this out. So, [snorts] go to chat.

[1:54:27] Let's open up a temporary chat. Always use temporary chats, friends. Don't put your Don't let OpenAI train on your data. Turn this crap off. Temporary chats, no history. Delete this crap. You get

[1:54:44] better results anyway if you don't have this history. It doesn't get biased. Uh anyway, so um um what's it called? Um

[1:55:04] March 17th, 2026. All right. I'm just going to paste the section and we'll see going to paste the section and we'll see what Chat's also gotten decently fast, I Uh okay. So, this is what I hear the reality. The

[1:55:17] lockup is still 180 for everyone who signed it. Here's the breakdown of why 90's in there. 90 is company itself must be subject to a report 90 days before held for for you've owned the shares for longer?

[1:55:30] Non-affiliates bottom line is last period not withstanding a holders of available securities entered a lockup agreements. Okay. Restricted uh Okay. No, it it it it thinks it's it's

[1:55:44] it's 180 days, which is more traditional anyway. So, let's see if ChatGPT verifies that. But then maybe maybe I was wrong about that. Uh I I was you know, not really good at reading this rule 144 stuff. But um

[1:55:59] this rule 144 stuff. But um um Uh I'm going to say I initially thought lockups for non-affiliates were 90 days, but looks like uh everyone

[1:56:16] is stuck at 180 days. So, I wonder if I could do a strike Yeah, there you go. Okay, cool. What? Key dates. 90 days reporting starts.

[1:56:30] Lockup expiration first trading day Sep 14th. 14th. Uh that's fair. Sep 14th first trading day. Uh and 6 months after IPO Sep 17th, 1

[1:56:43] year. Non-affiliates who have held restricted been affiliates during the past 3 months satisfy when uh But if they signed a lockup, their practical earliest sale date is Sep

[1:56:55] 14th. Bottom line Sep 14th. Okay. All right. All right. So, they corrected me. So, they corrected me. Gemini and and and chat corrected me.

[1:57:08] uh uh at 180 days.

[1:57:20] Put an American flag right there. America. America. >> [laughter] like where I like do I have to like take my pants off or are there like feet pics

[1:57:36] in there or something? Like what's what's a Meet Kevin ultra subscription? >> [laughter] >> Uh I don't I don't want to know. Uh All right. 104. 104, baby. PATH is up

[1:57:50] 3%. The Q sit at 600. >> [snorts] >> Yeah, ain't going anywhere until Pow Wow we comes to give us the owie. Pow Wow he's got to give us the owie.

[1:58:04] He's going to come. All right. Oh yeah, then we were going to go to AI concentration. So, let's talk about AI concentration risks. So, talk about AI concentration risks. So, Axios and

[1:58:17] let's close that. Refresh here. AI concentration. Do a Pokémon pack? Want me to do a Pokémon pack? Fine, I'll do it for you.

[1:58:31] Oh, I got the coolest card. It's not worth anything, but I got the It's not worth anything, but I got the coolest card. You ready for this? Look what it says. Hold on. Just read the name of it.

[1:58:49] >> [laughter] >> Come on, man. PP up ends P. I don't know who N is, but PP up? I saw that and I'm like, Max. Max, please. Please, you have to give me that card.

[1:59:02] >> PP up. That's crazy. All right, we'll go for an ascended hero today. today. Uh ascended hero.

[1:59:18] feeling I'm feeling the leaf. I'm feeling the leaf. What do you think it's the leaf. Let's see what we got. All right, ready? Ready and Oh, dude, psychic. Three times in a row

[1:59:33] now I've opened Pokémon packs and it's ended up being psychic. whatever. Marill Stunfisk Linoone, Oddish. Aw, look at Oddish.

[1:59:48] Linoone, Oddish. Aw, look at Oddish. Look at your cute little Oddish. Oh, and Oddish, this little cute plant is going to give us a reckless charge and do 30 Wow. Slurpuff

[2:00:02] Mightyena Team Rocket's Giovanni, reverse holo, also kind of cool. Little reverse holo here. Wait, is that a Poké Ball reverse No. But that looks pretty cool.

[2:00:16] Got a giant leaf reverse holo. Huh, I don't see why I like that. And Oh, another reverse holo. Oh. Wow, that actually might be a hit. Look at that. Team Rocket's Transceiver.

[2:00:33] That's nice. That actually might be a hit. It's probably worth like $2. You know, your expected value on Pokémon packs is like down 80%, right? Uh you really have to hit big and then you have

[2:00:48] to get them graded to make money. But let's find out. That is the certainly the best uh that I've seen in a while. >> [clears throat] >> certainly on a live stream.

[2:01:05] No matches. How is it how can it not be matched? Ascended heroes is such a new pack that uh right now. I don't know if it's just too blurry.

[2:01:24] good job, team. Preceded by the uh Preceded by the uh PP up. this isn't working. Uh

[2:01:38] yeah, I know. TCGPlayer Team Rocket's Transceiver Ascended Ascended Heroes 263217.

[2:01:59] So but it's it's a hit. You know, and then I wonder what it goes for graded. That's near mint holo. You know, these $5 cards are usually the ones that they could go to like 100

[2:02:13] bucks when uh when they're you know, PSA rated. potential potential of a rating here is.

[2:02:27] the front straight. It's actually even the holo condition looks great. even the holo condition looks great. It's actually in good shape. That one might be worth grading. Especially I mean Ascended just came

[2:02:41] out. So it's going to take a minute for uh it's going to take a minute for uh for the market to price grades for those. Uh all right, so

[2:02:59] a lot of money. Oh, good for you, Samuel. Thanks for donating $5 to me in the meantime. Yeah, I mean hopefully things just chill out from here, right? And you're at 109, so All right, so

[2:03:13] >> uh where were we here? AI concentration risk.

[2:03:26] over 1 trillion of debt for their AI goals this year. Wow. 1 trillion 1 uh 1 trillion of debt expected to be issued this year for AI.

[2:03:43] Hyperscale scalers would be 700 billion of that. Hyperscaler 700 billion of that.

[2:04:01] Private credit credit could fuel 50% of AI raise.

[2:04:25] risk here. Uh generic risk uh what if monetization Uh generic risk uh what if monetization fails, right?

[2:04:37] AI CAPEX drove drove 90% of economic growth first half 2025. 90% of economic growth first half 2025. Wow, that's almost all of it.

[2:04:55] the one who sat out. High risk, high reward. Rule of diversification. Yeah, All right, we get it. Uh that's interesting.

[2:05:08] Okay. >> [clears throat] >> Okay, we saw that. Oil still at 109.

[2:05:25] This is the gas strike. All right.

[2:05:45] most bullish person in the White House on going to war with Iran. He appears more aligned with BB. Okay. Uh let's write that down.

[2:06:00] Probably cuz of Jared Kushner. Axios reports Trump is more aligned with Axios reports Trump is more aligned with uh BB who uh uh BB who uh has maximalistic

[2:06:25] Appear closer than ever. You know, BB probably realizes probably realizes uh probably realizes

[2:06:38] uh he has to take advantage of a supportive US president now. You know, he might not get that chance again.

[2:06:53] Uh Okay. assassinations. Bombs focus.

[2:07:15] yeah, this was last week, right? Last week we heard, "Hey, don't strike oil." Uh last week US chided Israel.

[2:07:27] Uh don't strike oil. Uh infrastructure.

[2:07:40] Infrastructure. Don't strike infrastructure. Structure. Uh but this week they work together to strike South Pars. together to strike South Pars. Isn't that crazy?

[2:07:55] chaos. We want the stability, not so much in Iran. They hate the Iranian government more than we do. Trump and BB have otherwise joined at the hip, 12-day war. Suspicious of his intentions.

[2:08:11] Suspicious of his intentions. Zoom in. Some question. Assassination. Zoom in. Some question. Assassination. BB made it clear that more is coming.

[2:08:24] BB has a punch card of people to assassinate.

[2:08:36] More is coming. Okay. Interesting. All right, let's see what the

[2:08:49] All right, let's see what the Twitter >> [clears throat] >> Okay.

[2:09:03] can provide as much electricity as a 400 W solar panel does annually. W solar panel does annually. Uh-huh.

[2:09:15] Okay, asset classes. Can't blame gold. All asset classes will be down under orange man's stupidity. Wow, special situations aren't very happy.

[2:09:28] Oh, yeah, the sea rams are always entertaining. Closer footage. high rate Yeah, what what are rates doing right now? doing right now? Uh CMBS's.

[2:09:44] So, bond market 22. Okay, so somewhat stable there. Uh huh huh. We saw this. Old.

[2:10:06] Mhm. Forbes says 93% of jobs can be done at least partly by AI. Uh-huh. Oh, wow. That looks cool. Uh Oh, this is the one I got Oh, look at

[2:10:21] that up close shot from the AP here. Wow. Wow. That's intense.

[2:10:33] Oh, no. That was a missile. Cuz it looked like a placed bomb there, but uh let's see if we can actually see the missile. Uh I always try to do that. I'm like, "Oh, can you spot the missile?"

[2:10:51] enough. You know, if this is shooting at 30 FPS, the missile might be in the frame and out of the frame faster. See? That's crazy. So, it just hit next to the building outside or or you know,

[2:11:05] came in maybe from the angle that we can't view. can't view. And that was enough of an explosion to tumble the whole building. Boom.

[2:11:19] Secondary explosion or a secondary strike, we don't know. strike, we don't know. And there it goes. Holy smokes, man.

[2:11:32] Uh Yeah, I don't know about that. Gabbert Well, we saw that. Macy's more than 1,400 stores were set to close. Whatever, I don't really care about Macy's.

[2:11:48] refinance right now? Yeah, wait Wait wait for the Iran war to end. doesn't end, then we go into recession and you'll have a chance to refinance. If the Iran war does end, rates will come down and

[2:12:02] you'll have a better chance to refinance. has. Sup, Tom from MySpace?

[2:12:18] Rates will jump around the Iran war. Yeah. Okay. What else?

[2:12:48] tonight. Yeah, he's got to start his social media now that he quit the Trump administration with fanfare.

[2:13:02] South Pars. Here's South Pars for you. Uh This is uh not that entertaining.

[2:13:20] Wall Street. We did the Wall Street Journal. We did FT. Let's try Doomers.

[2:13:35] Yeah, Gabbert doesn't mention the uranium enrichment. That's right. uranium enrichment. That's right. Totally ignores it.

[2:13:47] People are using Claude to do their taxes, but maybe they shouldn't.

[2:14:11] They can give bad planning advice sometimes informed by outdated rules and tend to make mistakes reading digits off tax documents, especially K-1's.

[2:14:23] Taxes are incredibly nuanced. Yeah, they'll get better over time. Yeah, some of the OCR, you know, the image recognition isn't that great for text. So, you know, AI bots, they see issues

[2:14:37] uh that uh that don't really exist sometimes. billionaire family. Wow. Really?

[2:14:51] Fisher Sand and Gravel embrace the MAGA immigration agenda and has won $8 July. Wow.

[2:15:05] Third generation family business that specializes in sand and gravel. segments of the border wall. Wow.

[2:15:27] Inherited the business from his father, Fisher became a regular pitchman on right-wing networks insisting that his wall would be built faster than the competition. Also, he went on a the pitching spree.

[2:15:44] dollars. Fisher owns the entire company. Well, suck up to Trump, get contracts,

[2:15:59] Well, suck up to Trump, get contracts, make money. Makes sense.

[2:16:27] Let's see how we're doing over here. Q's are still stuck at 600. >> uh Let's do a quick uh summary of some of the Iran stuff. And uh

[2:16:41] also want to Let's [snorts] see here. All right, let's see what we got cooking here.

[2:16:58] and uh then we're going to get into probably some of uh Redfin data center news and maybe we'll look at private credit a little bit look at private credit a little bit more. But let's go do an Iran summary

[2:17:12] more. But let's go do an Iran summary so we can catch up with that. so we can catch up with that. Okay.

[2:17:25] That's good. And then where was South Pars?

[2:17:38] Okay, so let's catch you up to speed in case you're just joining.

[2:17:57] Well, it's another bad day for oil as the South Pars gas field in the Gulf has the South Pars gas field in the Gulf has been struck by US and Israeli forces. Not great because the US did chide Israel about a week ago for striking oil

[2:18:11] permission. And instead of preventing more strikes against infrastructure, the US has now joined in strikes against infrastructure joined in strikes against infrastructure leading Brent to hover around 109 to 110

[2:18:26] dollars per barrel now. We believe that if the war is not over by the end of the month, oil will probably move to about 120 dollars per barrel. Diesel futures are now up against the highs that we've last seen

[2:18:39] in 2022, around $4.30 a gallon, and we've seen a lot of gas prices across the country up between 50 to 100%. Uh a lot of the natural gas that's produced in South Pars goes to Turkey

[2:18:55] and Iraq per Bloomberg. Qatar is obviously frustrated, so are some of the Gulf allies as Iran is now vowing retaliation. And of course, this is I thought Donald Trump said this war was nearly over, yet we're still conducting

[2:19:09] more strikes." And there's now this this discourse going on inside the White House that there's a difference between Vance's opinions and Trump's opinions. a moment because they could signal that this war is actually going to go on for

[2:19:22] a lot longer than expected, which isn't great, especially since producer price numbers came in uh pretty miserably this morning. Uh, all producer price estimates missed. We had expectations of 0.3% uh on the headline, ex-food and

[2:19:37] energy, and ex-food and energy trade. Instead of 0.3% on all three of those, Instead of 0.3% on all three of those, we actually got 0.7, 0.5, and 0.5. A lot of this because of the third straight increase in final demand services.

[2:19:51] Uh, accommodation services, wholesaling, securities, investment advice, fuels, uh motor carrying, inpatient services. Uh, sort of a broad-based increase in

[2:20:03] services in the producer price index. Not great because it keeps the Federal Reserve, unfortunately, from cutting rates. The uh Financial Times believes that the Federal Reserve will not be able to cut until

[2:20:17] the personal consumption expenditures rate gets back down to 2% with it right now estimated to rise to up to somewhere around 2.7% Financial Times think it's going to take until the first half of 2028 to get PCE,

[2:20:35] of which PPI and CPI are components of, back down to 2%, which means it could back down to 2%, which means it could take 2 years to actually get rate cuts again, which isn't great. And again, this Iranian war is not helping. Iran is

[2:20:48] now vowing retaliation. It has issued evacuation orders for several energy facilities across the Gulf targeting the UAE, Qatar, Saudi Arabia. Specifically, we have some refineries like the Ras Laffan refinery. We've got the Mesaieed

[2:21:02] Petro complex in Qatar, the Samref refinery and Jubail Jubail Petro complex in Saudi Arabia. The Saudis also um indicated that they intercepted two

[2:21:17] ballistic missiles. The Al-Hasa gas asset in the UAE per Bloomberg is also being threatened. Keep in mind that Iran is the world's third largest natural gas producer, fourth largest of crude oil producer uh in the

[2:21:32] largest of crude oil producer uh in the world. They hold about 16% uh of the world's total natural gas reserve. And natural gas has been a larger source of revenue for them over the past few years. And when I say few

[2:21:44] years, I mean you could really go back 50 years, 55 years here. And you could see that we've recently had a spike in how much revenue as a percentage of GDP comes from natural gas. It's about 8.8% and this is exactly what was struck in

[2:22:00] Iran, which implies that our current administration is looking to conduct administration is looking to conduct deeper damage to the purse of Iran. what the White House is saying, what they're not saying, and some of the

[2:22:12] dissension that's happening within the White House right after a sip of this tea here. And a reminder that today is coupon code expiration day. So, if you go to meetkevin.com, remember to use coupon code too big to rig. Get all nine

[2:22:25] private live stream, every alpha report. Today's alpha report, we argued that we Federal Reserve. We set up both the short-term plan and a long-term uh suggestion for longer-term investors versus just day traders. But my advice

[2:22:40] today was do not try to play calls or anything until the Fed meeting at 11:00 Uh and sure enough, I mean, this market has really gone nowhere today. So, would have lost money if they tried to make trades over here in this mess. You got

[2:22:56] course, we got a plan for the catalyst as well. So, if you want that plan, you can always get it over at meetkevin.com. But for now, remember, we've got some issues. Russia says the conflict in Iran has no justification,

[2:23:10] will set global trade in the economy back for years. Russia's also pissed attacked in the Mediterranean. They're calling it terrorism. Tulsi [snorts] Gabbard is testifying before the Senate. She is, of course, the director of the

[2:23:24] US national intelligence service. The Iranian regime, she claims, is intact but largely degraded. She says that proxies uh and Iran remain capable of attacking the US and allies in the Middle East.

[2:23:38] If the Iranian regime survives, which of course BB's goal is that they don't, uh she argues that they will try to rebuild missiles, ballistic missiles, and their drone forces. Al-Qaeda and ISIS also pose threats, she

[2:23:51] says. However, she says there's been no effort to rebuild enrichment. Now, this is really interesting because she says that enrichment facilities in Iran have been obliterated by the drone strikes, which is Donald Trump's phrase. We

[2:24:04] obliterated their nuclear facilities. But this totally ignores the fact that we still haven't struck Pickaxe Mountain. We didn't strike them in June. I don't know that we struck them during this these latest attacks in volley soon

[2:24:16] Pickaxe Mountain is expected to be deeper than what our bunker-busting bombs can actually reach. The IAEA also today said that the Esfahan nuclear enrichment facility is up and running. It is a nuclear complex.

[2:24:33] It is unclear if they're currently enriching or where the 460 kilos of 60% highly enriched uranium are, but that the IAEA clearly has a different

[2:24:45] view than Tulsi Gabbard and the Trump administration, which is interesting because it's possible the Trump administration is telling us nukes, but secretly they know that they didn't

[2:24:59] highly enriched uranium. This is why Donald Trump has implied he might send ground troops in special forces to extract the highly enriched uranium. Uh Tulsi Gabbard instead says that Russia, China, North Korea, and Pakistan

[2:25:12] United States. Okay, everybody's posing a threat. And the US does not assess that China is going to invade Taiwan in 2027 or by 2027. The uh Chancellor of Deutschland,

[2:25:27] uh says that uh there is no convincing concept right now on democratic change for Iran. That they are in daily contact with the leaders of France, Italy, and with the leaders of France, Italy, and the UK. And uh they they do not see

[2:25:41] progress on this war. They also see the need to increase pressure on Russia, but sanctions on Russia, which basically makes it Russia richer, which makes it easier to fight in Ukraine for Russia. China's also agreed to postpone Trump's

[2:25:56] visit. And uh there is now a suggestion that inside of the White House, J.D. Vance is not inclined to this sort of like policing of the world, getting involved in this Iran conflict and war, uh sees it as a campaign promise that's

[2:26:09] basically broken. Axios is reporting this. But there are now also reports that Trump is kind of pro the war because he's a big kind of pro the war because he's a big fan of BB over in Israel. And Israel uh

[2:26:23] Israel's BB, not Netanyahu, uh has a punch card of leaders he still wants to There are reports that Donald Trump is frustrated that the allies his allies don't want, you know, to help him with Hormuz. NATO says they're in talks about

[2:26:37] anything to happen there. Uh which means you've got a frustrated Trump who supports BB. And now we're attacking gas fields even though a week attacking infrastructure." Iran is threatening to retaliate leading not

[2:26:52] only rates to go up, but oil prices and natural gas prices to spike. And Tulsi is telling us there are no nuclear operations, but the IAEA is saying there are nuclear operations and there's missing highly enriched uranium.

[2:27:05] So, all of this, while Israel is ramping up strikes on pretty much anyone in the region that is an enemy of theirs, uh including Hezbollah in uh Beirut.

[2:27:18] Well, there was video from the Associated Press this morning of a building in Beirut getting struck by what looked like a missile that comes from uh you know, another direction here. And uh potentially two.

[2:27:34] And it just collapses this potential Hezbollah building. One uh channel member posted that they are actually in Lebanon and they usually receive an IDF evacuation warning about 2 hours before. Uh 10 people were believed to have died

[2:27:49] in this bombing, which implies that not everybody actually heeded the evacuation warning. But that was from today. So, so far, and unfortunately, it appears the issues with uh Israel and Iran

[2:28:04] de-escalating. Uh and Donald Trump is siding more and more with enabling BB. If we do get to the end of the month and this war is still persisting, I do expect that Brent

[2:28:19] uh crude prices will rise to $120 per barrel. Uh remember that call options on the oil market do go up to about $120 per barrel. We see a substantially lower call interest once we get out to uh 130,

[2:28:37] 140, and 150. That's when we start seeing more of a drop-off in um uh Uh, in the anticipation for higher oil prices. That could be a sign though

[2:28:50] that the market is a little complacent that this war will end quickly versus the uh reality that uh that it will end quickly. So, we'll see. Not great at all. Uh but, what is great is you can use

[2:29:05] that coupon code and join the Meet Kevin courses on building your wealth and get that alpha report every single day uh when the market is open. I do want to shout out some folks who've recently joined Julio alpha membership. Welcome

[2:29:17] aboard. We've got uh Tobias Meet Kevin alpha membership. Welcome aboard. Vyron joined Vyron Vyron joins reinvest AI beta. Welcome aboard. Brian Meet Kevin alpha. Jody Meet Kevin alpha. Uh Florian Meet Kevin alpha.

[2:29:32] bunch of Meet Kevin alphas over here. Another reinvest. Uh another reinvest. uh thank you so much for watching the update on Iran and hit the next uh topics. Mhm. All right. So, that's Iran. A little

[2:29:47] summary there on Iran. Let's um let's go see what else is cooking. I want to see how how Swarm are doing. Uh chilling out a little bit. Had a lot of enthusiasm here. We went from about 46%

[2:30:04] up to about 109%. Some of that momentum is stabilizing. cliff uh but certainly stabilizing.

[2:30:16] again, if you play something like this, it's really important to have trailing stops. But uh yeah, I I still advocate around But uh yeah, I I still advocate around to 20% trailing stop usually.

[2:30:28] Uh obviously not personalized financial advice. Everybody has to figure their own stuff out. Uh anyway. Okay, so Powell is 2 hours Well, the SEP is now 2 hours away. And 2 hours away from the SEP, we are

[2:30:46] an hour or 2 hours and 30 minutes away from um the actual press conference.

[2:31:01] Oil towards Yeah, 110 after gas field is struck. I've calculated Well, yeah. That's not great.

[2:31:20] Didn't fail to perceive the Hormuz risk. peace would come quickly. Yeah, well, that was a mistake. Peace

[2:31:32] did not come quickly. Yeah, I think that the Trumpian MO. MO. It to me it seems very

[2:31:49] out. You know, even even what we saw on Liberation Day. It just sort of seems like somebody put together the Liberation Day ideas and then they, you know, revise it every day for the next 3 months after

[2:32:03] Uh and now we're going to pause. Now we're going to change them. Oh, we're actually going to I mean, maybe that's all part of uh That's what some people think. But uh

[2:32:16] if that's what's happening with war, could severely estimate this country of over 80 million people. That's could last a whole lot longer than uh everybody's been thinking, which is not great.

[2:32:29] Sizzle? This elevated volatility environment coming into 26 and I think environment coming into 26 and I think we also anticipated a much more muted you're in it, I said this to you before, when you're in the midst of it, it feels

[2:32:43] far more punitive. You're losing trends. You're really losing trends everywhere. You look today, we're down in the not significantly, but we're down. Okay, where can I hide out? Can I hide out in precious metals? No, they're down 3 and

[2:32:56] 4%. How about the quality factor? Everyone says own quality in an >> No, that's down as well. And then some of the sectors that have been the better performing sectors to hide out, defensively oriented like healthcare,

[2:33:10] like consumer staples, they're down as well. So, really the message here is you're kind of patiently sitting back. You're waiting to kind of get through this environment, which doesn't feel real good. I still am of the opinion you

[2:33:22] don't want to flinch here. I don't think you want to flinch in response to this kind of roller coaster environment. Say, okay, I'm going to go more cash than ownership of risk assets. Yeah, I mean, it's it's trying to accomplish a lot

[2:33:35] through time, isn't it? Uh Brian, I mean, we're 6 months flat. Joe does mention the trends have flattened out. We've maybe done some damage uh at least technically on some of the charts. UBS today, you know, saying expect further

[2:33:47] while because obviously of all the things that we've been stewing over. Uh oil price, credit spreads, wage growth, inflation expectations. Of course, Gen AI. We don't really know where that lands. In terms of the fundamentals, um

[2:34:01] at some point though, kind of we've been living with the concerns long enough that at least you might maybe be able to make a shot that they're somewhat priced in. So, how you making that call? Well, I think what's priced in is that people

[2:34:14] short. That's what's priced in. Which isn't great. for that reporting. Uh that is of course Europe, Aaron Kirchfeld. By the way, more action in Europe and here to

[2:34:29] discuss another deal is Scarlet Fu looking specifically at Unilever. Unilever, Danny, is yet another consumer packaged goods company looking to separate its lower growing food assets from everything else like personal care

[2:34:43] and wellness products products. Over the past decade, Unilever has reduced its exposure to food first by selling off its spreads business including the I Can't Believe It's Not Butter brand and last year by spinning off its ice cream

[2:34:55] division into Magnum ice cream. Unilever still holds a 20% stake in that and years. Now, its remaining food brands include Hellmann's mayo and Colman's condiments. And according to Bloomberg reporting, Unilever could spin off its

[2:35:10] its entire food business, keep some brands while separating the rest or keep days regarding timing. Any change may not happen before 2027. Now, Unilever is not alone. You think about Nestle, it plans to sell its remaining ice cream

[2:35:24] split its condiments and grocery staples business, but the new CEO put that on hold and is investing more money into some brands. And of course, in 2023, Kellogg split into a cereal company and snack company and both of course later

[2:35:37] your point is it's not just Unilever. It's been happening in this sector. Why? companies are seemingly struggling to drive growth?

[2:35:49] Consumer taste and overall shift to wellness. Consumers want more fresh, less processed food. There's reduced demand for packaged food overall. And on loss drugs, which have changed how people eat. They want more protein, less

[2:36:02] if you have nine that was public published yesterday by the Wall Street Journal that if you have nine uh processed foods a day, uh you know, whether that's like a donut or

[2:36:15] you know, processed ham or, you know, to go food or whatever, nine servings a day, you have a 67% increased likelihood of a I'm like, wow. Uh who paid for that study?

[2:36:31] But I mean, it's also kind of like not terribly surprising. You know, most our diet doesn't exactly encourage fruits and vegetables, which I think are so critically important. But whatever.

[2:36:45] Europe today, but in the US, we're still seeing big strategic M&A. We had a merger Monday deal. This, you know, storage behemoth, Public Storage, is buying National Storage. So, that's the first uh the you know, market leader in

[2:36:59] the US buying the fifth uh market leader. And um you know, the stocks are space to watch. We're expecting more consolidation. All eyes are on what CubeSmart does next. We're hearing that it was sort of competitive for National

[2:37:14] Storage. And uh with the home sales and mortgage rates um you know, pretty high, rates, let's pop into this. The top 20% of earners hold nearly 60% of American real estate wealth. The top 1% of earners hold 12%

[2:37:30] of the country's real estate wealth. the country's real estate wealth. And those in the 80th to 99th percentile hold 43%. Together means the top 20% of earners

[2:37:44] hold more than half of the real estate wealth. Yeah, this is not surprising. >> Uh let's see here.

[2:38:06] Oh, Lily, tell us more about real estate. All right. So,

[2:38:18] the evolving situation in the Middle East given the Iran war. Rates continue to march up.

[2:38:30] What about UBS? UBS has uh a little take today. Let's see what we have. Challenge ahead.

[2:38:42] Remains unclear how long the war will go on. Not pricing in the full effect. Let's see here. Financial conditions Financial conditions are not pricing in a full effect of a broader conflict, of

[2:38:54] a full effect of a broader conflict, of course. How fast inventories could fall and how high oil could rise.

[2:39:10] barrel. That's literally what I said, too. to 150 a barrel, which that's what Goldman says is recessionary, right?

[2:39:23] 150 is recessionary uh uh per Goldman.

[2:39:41] Uh okay, if Hormuz remains shut through April, we estimate US headline CPI could April, we estimate US headline CPI could peak near 5%. 5%.

[2:40:01] the second half. This is a problem. Uh potential problem. Uh second half is Uh potential problem. Uh second half is when Fed wants to see tariff inflation

[2:40:14] lap. If uh rate cuts dead in second half. And as FT economist put

[2:40:30] in second half. And as FT economist put it, might be dead until early 2028. That's not good. Okay. So, let's see what else they say here. Net pipeline flows inventory uh market still potentially short 10 10

[2:40:44] million barrels a day. Uh okay. So, this is basically saying uh after inventory release, still down

[2:40:56] 10 mil a day uh barrels. Yeah, they're a fun they're um if you watch the Reinvest course, they're good

[2:41:11] there. Uh so, we just released that course in late December. We released this like December 18th or something like this,

[2:41:23] right before Christmas. Uh and uh this has not only sales and negotiations, tax write-offs, build long-term family wealth, uh psychology, real estate, finance for children, diversification, debt trading, but also

[2:41:38] fundamentals are in there. Uh so, you can check here. Stocks and psyche is a little bit older, but also has really great content. And Trumpanomics has some as well. Uh so, what's You remember, if you join

[2:41:51] the B Kevin membership, you get all of those. So, like you don't have to pick. You unlock all of them in in the one membership. You can use that coupon code too big to ring. Okay, so where were we? Uh oh yeah, UBS.

[2:42:06] So, Strait of Hormuz typically sees 20 million barrels a day of crude flow through it. Iranian flows of 1 million still going through. Right. Okay. Hormuz is still

[2:42:19] closed. We see where we could rise to Yeah, this is not great. We model Let's see here. We model the example of

[2:42:32] 160 per barrel on the chart to show this. To show what? Even higher prices would only be prevented by significant potential reduction in demand. Right. 160.

[2:42:54] inventories of crude. fungibility global models looking at the relationship between asset markets

[2:43:10] potentially yield less accurate results. Okay, fine. '90s. Oh yeah, look at that. After each of the '90s, the US economy went into recession. For the most part, the Fed

[2:43:24] was cutting rates into and after these episodes. It was It only hiked after the '79 Iranian Revolution and 2022 Ukraine uh Russia conflict. So,

[2:43:47] uh so, this let's see here. Gulf War.

[2:44:06] average decline in the S&P 500 was just under 5% through previous oil saw shocks under 5% through previous oil saw shocks with a maximum around 15%.

[2:44:18] previously was 14.3. So, in other words, we are So, in other words, we are 50% more expensive today than prior oil 50% more expensive today than prior oil shocks on the market.

[2:44:40] Uh small caps and globals underperformed US. Uh let's see here. Chinese equities performed worse.

[2:44:56] the weakest performers. Uh this is quite interesting. So, energy is your best performer. That's not a surprise.

[2:45:10] Worst banks, autos, financials banks, autos, financials retail, consumer services, software insurance. You can kind of see it here in the row.

[2:45:24] Uh really, you've got Where's real estate? in here somewhere. Energy utilities. Food, beverage, materials.

[2:45:39] real estate in there. But anyway, energy and utilities. Energy, utilities staples performed best. staples performed best. Now, how's Costco doing these days?

[2:46:02] there. Okay. Okay. A little bit of a rotation like Uh that's them. Fine. Okay.

[2:46:18] Two-year and 10-year rose, two-year more than 10-year previously. What's your opinion on cash-secured puts during this month? Um during this month? Um Well,

[2:46:33] when um when this war ends. Like I'd rather buy on that day. And I'm going to send a trade alert as soon as I do. But I haven't been adding

[2:46:45] soon as I do. But I haven't been adding because the market is pricing in a very short-term war. last forever. But this hope that it's going to be done

[2:46:59] not seeing that so far. It's still getting worse, not better. you know, on top of that, I want to see if Powell rug pulls us today by implying any rate hikes. And then on top of that,

[2:47:12] I've also got to pay attention to the risk of another bad jobs report in March. So, you know, cash-secured puts burn usable cash that that you could use in case there's a larger correction.

[2:47:28] You know, people people got really screwed on cash-secured puts in uh 2022. and uh uh you know, at the end of 2021 at the

[2:47:42] top of the market, and it was it was terrible. You got screwed. Inflation could peak close to 5%. That's not good if we're shut to the

[2:47:57] That's not good if we're shut to the uh end of April. If the strait stays closed until the end of March, oil rises to 120 before

[2:48:11] falling to 80 by the end of 2026, it would increase inflation thereafter. But if we stay shut till the end of April inflation would peak slightly higher.

[2:48:25] All cases, the temporary nature of shock means the impact on core inflation would be muted. Long-term inflation expectations remain well anchored. This is very Powell line right here. It's almost like it's written by Powell.

[2:48:38] almost like it's written by Powell. As if written by Powell. Less concerned about higher inflation causing major dislocation at central ability to compromise consumer spending power. Real disposable income in the US

[2:48:52] has already stalled while saving rates are close to low. Inflation now could impact consumers Right. So basically

[2:49:05] So basically Let's do this. disposable incomes down since 2022

[2:49:23] We kind of sit Uh let's do this. Yeah, 2022 levels. coming out of some of that pain.

[2:49:41] These are growth rates. Oh, so we're about to turn negative. Oh, I see. I see. I see. This is just a growth rate. Um roughly 0%

[2:50:08] since 22. Uh dropping savings. can uh consumer survive the

[2:50:23] oil shock. Okay, let's [clears throat] see here. Uh Vance we will announce a couple Uh Vance we will announce a couple things in the next 24 hours to 48 hours.

[2:50:35] things in the next 24 hours to 48 hours. meeting with oil executives Thursday Two more bridges destroyed in Lebanon. Two loud booms heard in Saudi Arabia.

[2:50:57] Trump Vance to meet oil executives uh Thursday may announce something in uh you know, by Friday. Uh by Friday afternoon on gas prices.

[2:51:12] on gas prices. Okay. aggressively, markets may price in actions more hawkishly as inflation rises. Right. Right, that's a red flag right here.

[2:51:30] may widen. Oil shock could trigger an unwinding of positions. Right. I mean >> [clears throat]

[2:51:42] time oil goes up. Uh very clear correlation between uh oil Uh very clear correlation between uh oil rising and Nasdaq 100 down.

[2:52:10] and and just fired missiles at Saudi Arabia and potentially just hit two targets. Doesn't sound like they're out of weapons. of weapons. Uh

[2:52:27] It's an interesting UBS piece. I mean that the consumer is the problem here. Mm

[2:52:46] blah blah blah dollar giving up. Okay, that's fine. Several econ Okay, we saw this with the inventories.

[2:53:16] consumers in Asia would reach critical levels well before. >> So in other words we'd be okay with inventories longer. inventories longer. To be a risk of panic buying in oil.

[2:53:32] panic buying oil panic buying Stocking up. Got to stock it up. Refined products market is already seeing tightness in crude. Right. And then of course this is this

[2:53:45] is how core ends up getting hit.

[2:53:58] Cuz it's all those other components like plastics, right? inventories. Natural gas production facilities once shut are also much Takes several weeks to cool and then bring the gas to 160° below zero to

[2:54:15] liquefy into LNG. Interesting. Interesting. So that's the danger of shut-ins.

[2:54:29] uh an update on the Supreme Leader has just issued a Supreme Leader has just issued a statement.

[2:54:57] has stated uh of Mojtaba Khamenei. Oh sorry, that's the Supreme Leader.

[2:55:20] Chief Arjani security chief Okay. Uh

[2:55:37] Gabbard This is also interesting.

[2:55:51] Oh my gosh. Uh what am I doing? can't spell today. It's all right, whatever. Uh refuses whatever. Uh refuses to answer on whether there was an

[2:56:06] to answer on whether there was an imminent threat nuclear threat imminent threat nuclear threat posed by Iran in Senate. That's where she's saying this.

[2:56:18] saying this. Uh let's see here.

[2:56:43] Doombugga Let's go to the economist. alternatives. Regime is now less predictable.

[2:57:01] Lar Larajani was marching at the head of a crowd joined protest. >> [snorts] >> His appearance was intended to convey defiance. America had put out $10

[2:57:14] defiance. America had put out $10 million bounty on his head. Israel says it killed him in bombing and raids.

[2:57:45] Israel still seems to have excellent intelligence on where these leaders are. The regime cannot be brought down by strikes but only internal dissent.

[2:58:00] will not take to the streets while bombs are still falling. In the meantime the assassination appeared to be designed to progressively appeared to be designed to progressively disintegrate the state.

[2:58:19] He was the brother and son-in-law of the senior ayatollahs. Fought with the IRGC during the Iran-Iraq War.

[2:58:42] Some saw him as a potential leader of more pro-pragmatic second Islamic Republic or basically like a Venezuela

[2:59:07] to the end. That's the risk factor.

[2:59:22] end the war and more likely to pursue nuclear weapons now.

[2:59:39] This is the militia that they have in Iran. becomes and the greater risk that the state fractures into competing centers

[2:59:51] of power with unpredictable consequences. Yeah.

[3:00:30] escalating. Gulf states could join the conflict.

[3:00:44] Strait has become a focus of the war. Uh, let's see here.

[3:00:58] Closure of the strait, we've seen price okay, fine. Blah, blah, blah. Iran might encourage the Houthis to resume their own campaign against shipping in the Red Sea. That's like if Iran did do any of this

[3:01:18] damaged. Have already warned that damage to their oil facilities would cross a red line. Yeah, well, that's how you start getting into more of like world war, right?

[3:01:32] Yeah, we did actually talk about uh, J.D. Vance talking about an oil or natural gas announcement coming soon. So, you know, it looks like that move So, you know, it looks like that move Brent down about a dollar.

[3:01:47] they're going to release more from the strategic reserve or or you know, what their intention is, but uh, it seems like there's some kind of uh, it seems like there's some kind of desired manipulation going on.

[3:02:00] Try to get to squeeze those prices down a little bit. a little bit. Mhm. Okay.

[3:02:18] One by one, battle for the strait. Okay. What else? What's this? Private credit investors.

[3:02:36] business loans made by companies like Affirm and Block. Oh, buy now, pay later market to come under stress. Oh, here we go. Finally, it's hitting uh, buy now, pay later, huh?

[3:02:50] later, huh? No way. Uh, let's see here. Private credit.

[3:03:13] that J.P. Morgan Qualtrics deal. Cuz they just rug that deal. We'll look at that in just a moment. So, private credit, what do we have here? We've got

[3:03:28] a fund holding loans from Affirm and Block holding loans from Affirm and Block called Stone Ridge Asset Management.

[3:03:44] Uh, management told clients redemption requests were so high that it would only that it would honor only 11%

[3:03:56] of redemption requests. Wow, that's actually very interesting. Because what you really have to think about now is what happens if the BNPLs

[3:04:08] slow down. I wonder if Affirm stock is moving at all on that. here. Um,

[3:04:25] If private credit funds have been buying BNPL loans and those are now starting to dry up.

[3:04:46] Affirm and Klarna etc. might have to soon Uh, this squeezes the consumer even more. That

[3:05:01] squeezes the consumer even more. That kind of along with the UBS lines, right? like this convergence. Convergence of uh, consumer stress, oil,

[3:05:16] Convergence of uh, consumer stress, oil, private credit, war, BNPL, etc. BNPL, etc. That's interesting and not good.

[3:05:45] structure 350 m from the Bushehr nuclear reactor was hit. Bushehr nuclear reactor was hit. Where's that? Uh, Bu- Bushehr nuclear power plant.

[3:06:00] This is in Iran. It looks like

[3:06:23] place. Sort by recent. completely destroyed? Guys, come on, don't bomb this place. Let it stay safe.

[3:06:36] don't bomb this place. Let it stay safe. Permanent closure March of 2026. This place underwent a major renovation by Israel and the United States. No.

[3:06:49] Oh my gosh. Oh, it's ridiculous. Oh, it's ridiculous. >> [laughter]

[3:07:01] So, what do we have here? Recent redemption request Okay, so investors Yeah, private Yeah, private private credit concerns are worsening.

[3:07:21] geopolitical one, too. I yeah. um, site 350 m site 350 m from Bushehr nuclear power plant has

[3:07:36] from Bushehr nuclear power plant has been struck in Iran. me delete a bunch of this stuff. Uh, these are just old thumbnails.

[3:07:51] Here we go. Yeah, I got two things on my desktop now. See, I like that. Nice and clean. All right. All right. Uh, okay. So, private credit private

[3:08:03] Uh, okay. So, private credit private credit private credit. Stone Ridge fund didn't hold loans to software makers. Right, right. No loans to software makers uh, here, just

[3:08:19] consumer credit. Okay. fintech lenders. They buy loans made by fintech lenders.

[3:08:42] Uh interval fund must repurchase on shares on shares. Okay. did not reveal

[3:08:55] did not reveal how high redemption requests were. Okay, that's not good. That's going to lead to more panic.

[3:09:12] Cliffwater Lending Fund, which they have something to do with Atkins, I think. something to do with Atkins, I think. Corporate Lending Fund paying out 50% of redemption requests. Cliffwater's an interesting one. So, Cliffwater Lending

[3:09:28] has something to do with Atkins. >> [laughter] Uh-huh. Trustee who resigned from the board shortly before that became the SEC chair. Right. Had Paul Atkins on board

[3:09:46] Had Paul Atkins on board until he resigned to become SEC chair. Cliffwater is the largest SEC registered private is the largest SEC registered private credit interval fund.

[3:10:01] credit interval fund. Interesting.

[3:10:54] uh very interesting that the of a private credit fund is now SEC chair

[3:11:07] is now SEC chair as Trump tries to get private credit into 401ks. Uh sounds like a coordinated effort to get more exit liquidity for private

[3:11:22] credit. Especially as people are rushing for the exit and coincidentally

[3:11:34] a you know, former board member of the largest private credit member of the largest private credit interval fund ends up at the SEC. Probably probably easier to enable

[3:11:49] probably easier to enable uh you know, what's it called? Uh enable the 401ks to invest in private equity credit.

[3:12:01] They're both. And uh deferred enforcement. Let's see what people say in the Wall Street comments.

[3:12:13] If you invest in private asset without a market price and are told it's very exit your equity position quickly. Well, yeah, that is the whole point. I agree Sounds like Ponzi schemes. They limit withdrawals. Are these type of funds

[3:12:27] that 401ks can invest in now? Yeah, right. That's that's the 401k joke. right. That's that's the 401k joke. Uh

[3:12:49] the private credit boom. Traditional lenders have been losing market share. Western Alliance sued for breach of contract. Alleged Gemini era Jefferies subsidiary didn't pay part back part of

[3:13:02] a loan. Western Alliance alleged Jefferies alleged Jefferies blah blah blah.

[3:13:16] thrown $300 billion into private credit last year. Uh themselves to 300 billion of private credit just last year.

[3:13:39] So this bank index KBW Bank. Let's put that on to the private credit

[3:13:54] one. Did I do Oh, was it already on it? Oh, may have already been on it. Interesting. Yeah, you could see that drop in the bank index.

[3:14:12] though is wild. Okay, let's go to No. Is the article before that? Okay. Cliff

[3:14:28] Cliff Stone Ridge is $31 billion smaller Oh, they're a smaller player. Okay. They have $31 billion in assets. Geez, man. $31 billion assets.

[3:14:42] $31 billion assets. It's huge funds.

[3:15:03] Okay. And then here is the JPM deal. JPM uh bails. So, what is this? well. So, JPM

[3:15:20] bails on Qualtrics deal. I think this started in October.

[3:15:36] customer service software customer service software group.

[3:15:54] on Thursday that debt sales would be halted until further notice. Wow.

[3:16:07] also selling for a discount. No nobody want No No wonder nobody wants it. All So uh no wonder no one wants the debt. Uh old debt is falling off a cliff.

[3:16:22] 14% discount now. Let's throw that in.

[3:16:48] Let me see if there's anything else on private credit. Private credit private credit. Private credit a firm.

[3:17:11] from Affirm. Older announces from Affirm. See. PGIM PGIM I am. PGIM Prudential Financial.

[3:17:24] Uh-huh. Fixed income managers expansion of capital partnership. $3 billion revolving pass-through loan $3 billion revolving pass-through loan facility.

[3:17:38] Prudential asset uh management PGIM has a $3 billion revolving line revolving line with Affirm.

[3:17:56] Now Pay Later Affirm strikes $4 billion deal with Sixth Street. $4 billion deal with Sixth Street.

[3:18:16] fintech and private credit are coming together in a new multi-billion dollar joint venture. Wow. And now they're starting to get whacked. That's how the consumer runs out of money, which ties into the UBS piece.

[3:18:40] Private credit has exploded. Cuz see, this is a December 2024 piece.

[3:18:53] more efficient server. Unlike banks, which rely more on deposits, purchase loans originated by Affirm for purchases. Okay. Traditional banks are

[3:19:06] not completely out of the financing. Uh a whole ecosystem is funding higher capacity for more for short-term loans. Affirm provides credit to customers. 0 to 36% APR. Wow.

[3:19:27] Let's see. Affirm investor relations. There it was 2.8%. Let's see what they sit at now.

[3:19:42] SEC filings. Quarterly. Quarterly. Feb.

[3:19:56] >> [sighs] >> So, >> So, payment deferral.

[3:20:25] And this doesn't align with the CNBC article.

[3:20:40] past due number has gone down. Total amortized cost basis. Total amortized cost basis. 60-90s up a little bit. 30 to 59s up a 60-90s up a little bit. 30 to 59s up a bit. 4 to 29 past due is up a lot.

[3:20:53] See that right here. That was

[3:21:06] Okay. Uh but that's also still down from here. lot. I don't think you're necessarily seeing a big skyrocket or anything there on delinquencies. But, that is interesting.

[3:21:24] So, that's Affirm also getting hit on private credit, which really aligns with private credit, which really aligns with what we saw in the UBS article.

[3:21:39] So, Q's. Yeah, still sitting at 600. Q's. Yeah, still sitting at 600. Waiting for Powell.

[3:21:55] All right. Let's see here.

[3:22:15] Cool. So, yeah. Powell's in about an hour.

[3:22:32] All right. Let's see. Uh okay.

[3:22:46] Okay. So,

[3:23:02] moment. In the back half of last year, it was it was clear it was an improving market, but an improving market. And generally, what you see in the M&A market is volume of M&A follows value. Last year was the year of the mega deal.

[3:23:17] You had a real spike in the ultra-large deals. What we've seen in every kind of recovery of the M&A market is volume follows. So, and we started to see that a bit in the back half of the year. Investment banking business, which is

[3:23:29] largely driven by M&A, was up almost 30% last year. And a lot of it was in the back half of the year because, as you noted, we had liberation day and everybody thought last year was going to be a really bad year for M&A.

[3:23:41] It didn't play out that way. It shook that off and picked up in the back half because the fundamentals are still good, right? It inflation has gotten under control. There's an expectation of lower interest rates. The underlying economic

[3:23:55] with with those with those fundamentals good, with private equity having a backup of deals they'd like to sell, we expected and continue to expect this to be a good and improving M&A market in

[3:24:08] 2026. There is no doubt, though, that in the last several months or last several weeks, um talking about the private >> Injecting some volatility. Rob, I'm apologies. Got to jump in. Just heading

[3:24:20] appreciate your time. This Lincoln International. Then, you're not going to be able to tell me not to buy that car. But, to your point, the data is really compelling about the need. The NFL made

[3:24:33] compelling about the need. The NFL made 23 billion in revenue last year. Uh-huh. JP Morgan losers. Okay. Let's summarize this UBS piece because it's really interesting. And it really goes into what we're seeing with

[3:24:47] really goes into what we're seeing with uh the consumer risk as well. Uh okay. So,

[3:25:02] let's see here. Uh kiddo key.

[3:25:29] worsening of the consumer is now potentially a risk, not just because of the war in Iran, as UBS warns, which we're going to break through exactly what they're warning regarding oil, but also because of private credit. And now

[3:25:45] it's kind of scary because it feels like we're getting this like merger of problems here. I wasn't even thinking about, you know, the potential for buy now, pay later to get hit. But, at least not, you know, now. But, we've been

[3:26:02] talking about private buy now, pay later for a while. I'm saying, "Hey, if people later and for some reason at some point in the future, buy now, pay later doesn't become available anymore or it gets severely restricted, then the

[3:26:15] consumer could get screwed." And so, now you're seeing this potential that you're seeing this potential that private credit funds have invested or private credit funds have invested or enabled a lot of buy now, pay later

[3:26:29] But, the problem is Iran is making not only the consumer sad, thanks to high oil prices, but also potentially raising rates in private

[3:26:43] potentially raising rates in private credit, leading to higher default rates, credit, leading to higher default rates, leading to little softly. Leading to potentially lower funding in buyer buy now, pay

[3:26:58] which then also makes the consumer unhappy because you have less access to buy now, pay later. So, in other words, you've got this now confluence of issues that people haven't even been thinking about private credit

[3:27:12] even been thinking about private credit getting hosed from the point of uh the consumer loans. Most people, when we talk about private credit, have been talk about private credit, have been focused on, "Hey, what's going on with

[3:27:25] uh software stocks?" Like, JP Morgan just bailed on the Qualtrics deal, which was a huge deal. Uh JP Morgan was setting up a 5.3 billion-dollar deal for a customer service software group. And, quote, from the Financial Times, "JP

[3:27:41] Morgan informed investors on Tuesday that debt sales would be halted until further notice." In other words, nobody actually wanted the Qualtrics debt, Qualtrics debt has been falling off a cliff and it's now trading for a 14%

[3:27:57] discount. And so, the new debt sale, JP Morgan's basically like, "Yeah, no. We private credit stuff." Or we're starting to constrain debt to private credit. But, now, unfortunately, the pain is spreading in private credit, which is

[3:28:12] not great because it expands to the consumer at the same time UBS is warning the Iran war. Take a look at this. Private credit investor exodus spreads to consumer loans. And in this Wall Street Journal article, they basically

[3:28:27] say that uh fund holding loans from a firm and even Square called Stone Ridge Asset Management, this company uh right here, they have about $31 billion in assets. They told clients that redemption requests were quote so high

[3:28:43] redemption requests were quote so high that it would only honor 11% of what people wanted back. Now, they didn't actually reveal how high the redemption requests were. But, if private credit funds have been

[3:28:56] buying buy now pay later loans, which now, you know, obviously we know they have been, then you could actually end up seeing a limit to how much capital Affirm and Klarna have to actually provide funding. Now, if you go look at

[3:29:09] Affirm stock, Affirm stock has, well, not only intraday been falling on this news, but over the you know, since about January, so year-to-date we've dropped about 50% in value on Affirm. And if you look at Klarna, it's even worse because

[3:29:25] look at Klarna, it's even worse because Klarna IPO'd in September. Klarna is Klarna IPO'd in September. Klarna is down from its IPO about 75.5%, which is insane. The bank index, because of fears over

[3:29:40] The bank index, because of fears over exposure to private credit, K um KB exposure to private credit, K um KB WB, Invesco's bank ETF, uh has come down about a about 15-16%

[3:29:55] since its highs in February. So, we're kind of seeing that sort of contagion spread, but the concern is that if we start losing access to buy now pay later later loans, the consumer might end up getting

[3:30:08] squeezed from more angles than previously thought. And that's where, you know, some of the UBS commentary is a little problematic as well. See, Affirm has previously bragged about striking deals. Like, here's a CNBC

[3:30:21] article from 2024 where buy now pay later firm Affirm strikes $4 billion loan deal with private credit firm 63. Or here's another one with Prudential, Or here's another one with Prudential, $3 billion revolving line to make loans.

[3:30:34] As people pay them off, they go make more lines. So, like, if private credit is now suffering redemptions and they've been giving lines of credit to Affirm, then if private credit redemptions limit the lines of credit to buy now pay later

[3:30:47] firms, consumers might not have as much access to private buy now pay later in the future. Which is a problem, especially because now we face the risk of a consumer crunch because of rising oil. UBS argues

[3:31:01] that well, they pose the question, what if we do not have a short end to the war in Iran? And what is this going to do to the consumer? So, they argue that if the Strait of Hormuz stays closed until the end of March, oil is going to hit $120

[3:31:15] per barrel and potentially reach $150 per barrel by the end of April if the Strait has not been reopened. We know Donald Trump is upset that his allies are not helping him reopen the Strait of Hormuz. We know

[3:31:28] he's sending amphibious units to the region, but $150 is a recessionary great. That's what they say, if we hit $150 per barrel, that's recessionary. Now, at least if there's any good news out of

[3:31:42] all of this, it's that we have a coupon code expiring tonight after the Federal Reserve meeting for the Meet Kevin membership. You can use coupon code too every trade alert, every private live stream, every alpha report, and you get

[3:31:56] all of the courses, the reinvest course for fundamentals, long-term investing. taxes. Most people write it off on their taxes. Obviously, consult your tax accountant, but uh you get the brand new

[3:32:09] December, all the old lectures and content, all the historical stock analysis and future analysis we do on a daily basis. So, very, very exciting here. Uh but, let's keep going with this

[3:32:22] UBS piece because the UBS piece is really giving us a warning about the consumer. So, take a look at this. If we go down here in the UBS piece, then we'll look at some of these sectors.

[3:32:34] consumer. We are concerned more about the impact of inflation on consumers than rates. So, they basically say that consumer incomes, real inflation-adjusted consumer incomes, are basically flat. So, in other words,

[3:32:48] we're not growing incomes anymore. If we're not growing incomes on an inflation-adjusted basis, we might not actually be spending more. So, maybe that's why we're seeing flat retail spending in some of the recent data.

[3:33:00] uh and that you can see right here, sort of this declining real income level. But over here, you could also see a drop in savings that has recently occurred in we keep dropping. And so, the question here that UBS says

[3:33:15] is they're not so much concerned about central banks and cutting rates or inflation expectations remain well anchored. So, we're less worried about this, and they think that oil correct back to $80 by the end of the year as

[3:33:29] long as the Strait ends up reopening, you know, after either March or after April. They think we're going to go back to $80 a barrel. It'll go back down. in the meantime, the real concern is the consumer. What happens to consumer

[3:33:43] spending and as a result, banks as inflation hits spending now. In other words, could that be recessionary? Obviously, we know that there's a very the Nasdaq 100 moving down. It doesn't help that Brent's sitting at, you know,

[3:33:58] 108 to 109 now. You've got J.D. Vance yapping uh right now that, you know, they're going to try to do something over the next 24 to 48 hours about uh oil and gas prices. You know, maybe they're they're going to be meeting with

[3:34:11] some oil executives Thursday, and there's talk that they're going to, you know, maybe release some more oil from strategic reserves or whatever. But, if the consumer ends up getting sapped because of higher gasoline prices at the

[3:34:23] on top of that, you have less availability because the private credit issues in consumer loans, you can actually squeeze consumers from both sides. Squeeze them on the availability

[3:34:35] sides. Squeeze them on the availability of credit and squeeze them on expenses, which is obviously bearish. Now, during oil shocks, UBS also tells shocks, actually, after each supply shock from

[3:34:53] actually, after each supply shock from the 1970s to early 1990s, the US economy went into recession. So, basically, after every shock from the early '70s to the '90s, every shock we had, we ended up having a recession.

[3:35:05] This is, you know, uh offset by the Russia-Ukraine conflict where, you know, Russia-Ukraine conflict where, you know, we had inflation uh like 9.1% and we though we did have quite a heck of a beating in the stock market. They also

[3:35:19] argue that historically during these oil crises, the S&P 500 ended up dropping a maximum of about 15%, but the S&P 500 is valued about 50%

[3:35:31] higher on a forward price-to-earnings multiple right now going into this shock multiple right now going into this shock today than it was previously at 22.1 times versus typically 14.3 times.

[3:35:43] about what this could do to the consumer, especially since we're, you know, seeing more aggressive responses from Iran and uh natural gas facilities once shut in can take weeks to bring online again. Uh core inflation can also

[3:35:58] get hit by increases in oil, and uh they suspect that we are still, even after inventory releases, down about 10 million barrels per day on oil. So, we're still getting whacked here. And as a result, you know, if this war goes on

[3:36:11] through the end of April, they think we're going to be at recessionary levels part, that the consumer is going to get hit. And when you combine that with private credit, private credit exodus now affecting

[3:36:26] companies that are holding loans to consumers, not just software makers, this. That suggests that investor concerns about private credit are broadening. Unlike private credit funds that experienced a flight of investors

[3:36:40] in recent weeks, Stone Ridge's fund, which lent to Affirm, didn't hold loans in software makers or other corporate uh sectors that investors fear will be displaced by AI. So, in other words, Stone Ridge has nothing to do with

[3:36:55] artificial intelligence, and even they are getting dumped, which it means they'll have less available capital to fund Affirm or Klarna or the others. That's not great. So, you got some problems here, and unfortunately, those

[3:37:10] problems are worsening, uh not getting better, which could be why we're seeing, you know, Affirm even fall more on this news, even intraday. But, um scary for the consumer. But, you know, if you want a uh day trading,

[3:37:26] medium-term trading, and long-term trading strategy, make sure you get your alpha report over at meetkevin.com. Got that coupon code expiring today. already pricing in that they're going to raise rates twice this year. Everybody's

[3:37:41] a bit slow. That said, Jim, I was asking some kind of different analysts about this in in the last few weeks, and they said, well, the ECB was much quicker to rates are pretty low. Um and so, their, you know, I guess

[3:37:56] reaction can afford to be a bit more hawkish than ours. Uh that's true. They can be a bit more hawkish, but I also think that as Steve Liesman was saying, when you look at the inflation numbers and you look at what

[3:38:08] we're probably looking at maybe a 0.7 to 0.9 for March CPI uh coming this month. The Fed is is definitely done cutting rates until something changes. And I do think if the economy rebounds and everything that we

[3:38:23] not alone on that. Beth Hammack at the Cleveland Fed has even brought up the hike word, too. So has Ms. Sam, who is sitting next well, remotely sitting next And and I really took notice of that, Claudia, cuz of course we all follow

[3:38:37] you're always very measured. And in fairness, you are very measured this is really about risk management. They have to the risks of a you know, a worse labor market, but you also acknowledge the risks of a rate hike.

[3:38:51] How high do you think those risks might be right now? And and what's important is they really shifted since the Fed last met in January. The war in Iran and the potential

[3:39:04] inflationary shock really does change the dynamic. It changes the risks that are on the table, the ones that are possible. I think, you know, my base case and I imagine many Fed officials is this going to be a temporary disruption

[3:39:16] while they will wait to see that, they will look through it largely. But there is a risk that this is protracted and you know, inflation really moves high. And this is such a salient price have go through gasoline to have it then maybe

[3:39:30] point the Fed really [clears throat] can't take anything off the table and it is possible the next move will appropriately be a hike, but it's far too soon to say that, right? It's just we've got to put all these these these

[3:39:43] scenarios on the table right now. Steve Whitey, yesterday I was sitting with Steve Grasso who thought it would be a terrible mistake to raise interest rates in response to an oil price shock, which I would generally agree

[3:39:55] actually. I mean, the last thing you want to do is take something that acts like a tax on the consumer and double down by tightening monetary policy. That said, this report shows that we've had pipeline inflationary pressures building

[3:40:08] for a few months time. Can you give us any clarity on why that is? And do you think a rate hike versus a cut? I mean, what what makes sense in this kind of I just want you to just imagine going forward if the economy is in a

[3:40:22] recession, employment is contracting by a couple hundred thousand per month, month after month, the unemployment rate is rising to 5 and the unemployment rate is rising to 5 and 1/2% What is the Fed doing? Regardless

[3:40:34] of what they can do and what they can impact. The Federal Reserve would be significantly. We probably wouldn't hit zero again pretty easily, but the Fed would be cutting hard. And that's the problem

[3:40:48] with just focusing in on the immediate view of the economy. The opportunity to view of the economy. The opportunity to restrain inflation during a stronger period for growth, being a little hawkish when things are going well, that

[3:41:02] was the Fed that we used to know. Now they're not really going to do what they did in 2020, 21. We saw the mistakes that they made being excessively happen to the economy. They wanted to be very accommodative. So I I think we're

[3:41:17] jobs that were lost in the month of February probably not representative of exactly where the labor market is, but this is a weakening labor market trend. You can see this in consumer surveys

[3:41:30] that are telling us there is less demand than there is supply. And okay, the issue that we've just had with energy like the tariffs here, another thing that constrains potential economic growth should mean that the Fed can't do

[3:41:45] we're seeing in the labor market now has roots all the way back in the tightening roots all the way back in the tightening steps of 2022 and 2023. And the Federal Reserve sooner or later is going to react to this labor market ideally when

[3:41:59] So Claudia, I have I have a a bigger is we're in a strong CAPEX cycle right now. We're in a you could argue we were in underinvestment during the 2010s in a

[3:42:12] Now we're scrambling to catch up, especially when you throw AI on top of that. If or as that drives up interest rates, what do you do with a a somewhat weak weak labor market at the same time?

[3:42:27] Well, the fact that we have a good capital expenditure backdrop, that is a plus, right? It falls right in there with we have a consumer that overall has been relatively solid over the past year. So, you know, whenever we want to

[3:42:39] go into a shock like the energy price shock on the best footing possible. I don't think, you know, so I see this more the CAPEX spending, I see that as a this moment, you know, that we want to see those

[3:42:52] expenditures. And I don't think whether you look at on the capital expenditure market, they're I mean, I think there's a Claudia Sam has kind of a point here that, you know, these higher rates of inflation, you know, and the other guy,

[3:43:05] with tariffs, but because of what we're seeing with oil. Like all of these things are just bad, not only for the consumer, but also inflation. So, consumer, but also inflation. So, not happy. You know,

[3:43:23] interesting to see how this plays out. I I because now, you know, both sides are ratcheting up attacks on oil infrastructure. And all of it is just inflationary and you can't expect the Fed

[3:43:37] Fed to cut So anyway, All right, I'll be back for the Fed And

[3:43:51] And we'll see you soon.