Hey everyone kevin here: it is the evening of sunday december 17th and dao and indice futures are turning red. As you can see, dao future's down two thirds of a percent s p 500 future is down point eight. Four percent nasdaq technology is down one percent and small caps down one point: eight, eight percent, with the volatility index to about 24 and a half we've seen, some of these numbers come in even worse. Over the last hour, or so here and folks, we got to talk about why the stock market is likely to be red tomorrow, which is unfortunate, just as we thought we were over catalyst, but we got to talk about what's going on.

A lot of this has to do with the insanity of omicron, so we're gon na be talking about some omicron insanity here and some of the numbers that are creating a whole lot of fear, uncertainty and doubt. We've also got some other political issues that have popped up. Let's get right into it. First, we have good news out of south africa, while deaths, uh and hospitalizations continue to inflict down.

We have been worried about the potential for cases to continue to rise in south africa and potentially eventually lead to omicron cases leading to well more deaths and hospitalizations. But we have started to see an inflection down in cases in south africa which you can see that inflection rotating down right here, uh december 19th, we're getting that rotation down, which is very, very good uh for uh what we're seeing in the omicron spread. So then, why are a markets fearful? Well, markets are fearful because it is believed that in the united kingdom in the united states, omicron could end up being substantially more severe. Now there are a lot of twitter warriors and comment warriors saying.

Ah, don't worry we're going to get to hurt immunity by now, a lot of people have already had uh kovid, so they'll have some form of protection, and this is just unfortunately, highly false, having covid according to imperial college and their study from just the end of Last week, having coveted only offers a and or having had coveted prior illness only offers a 19 protection against omicron. Unfortunately, though, we don't have much better information for the boosters and vaccines via reuters. As of december 12th, boosters give us about 70 to 75 protection against symptomatic disease, but you're still likely to test positive with a breakthrough case uh. Fortunately, though, the uh well, the likelihood of having certainly severe disease is substantially lower and the likelihood of having symptoms at all is substantially lower with vaccines and uh or a booster now uh.

What the fear that's being spread right now, though, the fear, uncertainty and doubt that's being spread, is very simply exponential, extrapolation. The reason for this is, we believe that the omicron variant is spreading somewhere around four to six times as much as delta is, and if you take a doubling raid of omicron of every three days, omicron doubles and a doubling rate of every 14 days at its Peak delta doubles - and this is just to the point of peak because at some point viruses hit a peak, they hit a ceiling and then we rotate down right. And so, if we say both delta and omicron were at the beginning of a race and both of them started with 50 000 cases, and then we let them rage for 45 days. What would that potentially look like on an exponential basis right? Well, if we jump on over here, we can see exactly this.

This is just a simple spreadsheet modeling that if, on day, zero we're at fifty thousand cases for omicron fifty thousand for delta by day three we'd be doubled for omicron, but we won't be doubled. Yet for delta, until roughly day 14.. Now this is where it gets scary. If you extrapolate this for 45 days just 45 days now, what you would be left with is look at this number.

It's insane! Okay! Now i know these numbers are insane, but this is this is what the market is reacting to. I want to bring you facts, and i understand that the things that could appear to be fear, uncertainty and doubt are also potentially factual right. There's a difference between fake news and fud, so people say fud, it's like right, but that doesn't mean it's not true right. Yes, this can be fun, but it could be true.

Fun. Yeah models suggest that we could be over a billion cases of omicron. Now not all of those may end up being diagnosed, but the point is we could quickly get to the point of having the vast majority of the world, maybe not the vast majority, but a substantial portion of the world of seven billion people infected by omicron, the Delta variant in that same 45 days would be at less than 550 000 cases. This shows you how extremely different the spread is now sure omicron is being right now likened to a cold or relatively mild or a flu right.

The difference, though, is if we take the death rate of omicron and it's and assume it's just one-tenth of the death rate of delta, just one-tenth. The death rate look at how different the deaths are in an unmitigated spread. You could potentially get to 1.3 billion deaths in omicron compared to just 3594 and delta. This is unmitigated.

It's just to show you that exponential math is really really bad, and this is, in my opinion, whether this happens or not. This is what markets are going to. Potentially start trying to price in they're going to start pricing in holy moly. If everybody's going to get on me we're going to have a lot of people dying because it spreads way faster than what we see in in basically anything else that we've seen in terms of covet but likely even spreads faster than the flu spreads faster than the Cold, it's just ridiculously transmissible.

We could see our hospital system get overburdened, even though it's one-tenth as uh severe. Now, with that said, the markets are obviously turning red and there are now more fears that potentially it's time to exit the market. To the point where bloomberg has now suggested that korean south korean day traders are now net sellers for the first time since 2019, and this has left our futures red on top of this, we have a senator joe manchin, suggesting that quote. I can't get there quote.

This is a no on the buildback better plan. In other words, joe manchin is now going for a no vote. At the same time as we have this unmitigated spread on omicron, leading to a lot of confusion in markets that were at least to some degree, pricing in the potential that the buildback better plan would get passed, that there would be an extension of the child tax Credit that there would be uh paid leave that there would be an ev credit boost. So we could see this pain uh in the stock market actually exacerbate, because certain industries that we're expecting stimulative uh well essentially more stimulus coming to uh shoppers or consumers.

They're not going to see that stimulus anymore, the child tax credit is one of the biggest stimulus checks you can ask, for i mean it's three thousand dollars per child under eighteen. If you have a child under six, it's thirty six hundred dollars right. So this not passing for another year is is almost like robbing that stimulus, and so this could be another reason why we're seeing markets red but folks, let's look at a little bit more of the science behind what's going on and what what the latest information is. Regarding omicron, first pfizer believes that covet will end up becoming endemic by as soon as 2024.

This means that covid will potentially become as regular as the flu and as regular as essentially as needing to get a potentially bi-annual flu shot or not up to you right, but that we might transition to this endemic state as soon as 2024. Where, basically, we're just always going to be living with covet now, hopefully it is a mild form of covet, like omicron knock on wood. The early research shows that omicron is much more mild, and this is very, very good. This is important and it could usher in the end of the pandemic, as researchers at harvard have already.

Let us know which is good, but again an unmitigated spread of omicron could lead to a lot of fear, uncertainty and doubt in the short term, especially as we're still seeing a surge of delta cases in the north and northeast states in the united states, as well As now coming down the east coast and in other places in the united states, we're still seeing a delta surge now good news, bad news, it's estimated right now that omicron is already becoming dominant in the united states, yet we're not even realizing it yet that there Could be so much omicron already spreading that people are sick but they're not getting tested because they're not severely sick, but they already have omicron. They just are shaking off a cold. Basically, and that's because if you look at wastewater samples collected in south florida, i know that sounds gross, and so like wait. A minute is that an invasion of privacy is that that are you taking samples, my stuff in the toilet? It's weird right, but wastewater sampled.

In orlando county, which is where disney world is show that omicron is already dominant in florida. So this is leading to a lot of fear that we could actually end up having a worse surge in america. Just like what we're seeing in the united kingdom than what south africa is experiencing now, the united kingdom right now is estimating so far that 80 percent of cases as of friday are omicron cases. They are refusing to rule out more restrictions prior to the uh to the to the christmas holiday.

They do have about 85 individuals in the hospital right now with omicron modeling expects that we could reach a peak of about 3 000 hospitalizations per day in england. They did have just over 4 000 hospitalizations per day with delta. Now, right now, experts in the united kingdom are expecting that more than half of the admissions going into united kingdom hospitals are coming in for other reasons, but because every patient ends up getting tested for covet they're. Finding oh you're, coming in for this surgery or you're.

Coming in for a pregnancy and delivery, you're coming in for whatever, but you also have covert boom, now you're a covet statistic right: it's obviously standard for people to get tested when they go to hospital. Now, as of thursday, we are expecting that seven people have died with omicron uh in the united kingdom. Now note this is not necessarily from omicron and we're still trying to figure out the death statistics and it's that uncertainty that is creating uncertainty in the markets. Now the scientific advisory group for emergencies sage believes that it is certain that hundreds of thousands of people are being infected with this variant, but they're just not being picked up in statistics, so omicron may already be much more pervasive than we think it actually is.

Based on statistics, we also had a pretty powerful study come out of hong kong, which we already touched on a couple days ago, but i want to go a little bit more deep into some of this information. The omicron variant modeled in this hong kong study came well. Essentially, the researchers came to the conclusion that omicron not only spreads faster than delta, but it also replicates much faster than delta, and the reason for that is omicron seems to replicate substantially in the lung passages. The bronchus, the air passages that lead to your lungs and at 24 hours after infection, this study indicated that the omicron variant quote replicated around 70 times higher than the delta variant and the original variant.

However, it replicated less efficiently 10 times less efficiently in human lung tissues, which is where the original virus replicated, and this suggests a difference of severity. It's kind of like when you believe you have uh something like dr john campbell put it well. He refers to the potential of this, maybe coming across as a cough as if you have bronchitis versus a cough where you're potentially spitting up blood from having a pneumonia. So it's almost like having a deep chest: cold versus having kind of a surficial cold.

Now that is good because it's it's at least indicative of a more mild form of disease, but because it's now in your air passages, it's also much easier for you to spread omicron now, because after 24 hours, you already see the 70x replication of omicron. It's really fast for you to go from okay, i got exposed to omicron and the next day you wake up and that next afternoon, so you got in the afternoon before you're already spewing on me. Everywhere, it's crazy and that's! What's leading to faster infections, the paper went on to say it's not just about your body and about where this virus replica replicates, though, but it's also on to how your individual body responds. If you end up with a cytokine storm, this is kind of an overactive immune system response.

You could have a severe case of omicron and that's why this study went on to say that omicron is very dangerous, because quote even though the disease and death through the virus may be less pathogenic taken together. The overall threat from omicron is likely to be very significant, and this is again where we can go. Look at that quick math that we threw together on a spreadsheet and whether or not it's fun, it's true or that's false doesn't matter markets are reacting to this. I mean just in the time of filming this i've seen the small caps drop another 0.1 now the small cap index indicating which, which includes a lot of our recovery and travel stocks, indicating a negative two percent open now, what's also worth noting, is that in new South wales, which is uh in australia, we expect or we're finding.

The premier is telling us that 261 individuals are hospitalized, believed to be with omicron. That's expected to be the current statistic in new south wales, but notes that of these only 33 are in the intensive care unit. 26 of those were unvaccinated so another reiteration that you don't necessarily know how your body is going to respond for the vast majority of people. We expect it to be mild, but there are going to be individuals who will potentially end up in the icu and in intensive care because of omicron, even though we're seeing ventilator and oxygen use plummet for the vast majority of people.

It's that smaller percentage that could still get hit hard and now we're going to expect to be exposing a whole lot of more individuals. Now, in the united states we're seeing the uh seven day, rate of hospitalizations start ticking up, and this is where we have to be careful always comparing to south africa. We have different weather right now than we do well in north america than we do in uh. South africa, for example, in a lot of different territories or states - i should say in the united states - we've got snow, very cold climates.

Cold brings people together around war, perfect place to spread disease in south africa. You've got moderate temperatures somewhere between 60 and 70., so uh. It's it's uh worth worth, noting that it's also worth noting that the coldest month in south africa is actually june, which is kind of the opposite of most of the united states and europe right. A different uh, different part of the world, but anyway uh in new york, you've got the mayor of new york, calling on federal help because new york city cases have tripled.

The rate of cases is exploding in the united kingdom as well. We went from a seven-day average of around 55 000 to all of a sudden, 86 000 cases and now, over 124 000 cases in one day. That is the latest case count that we have the easiest way by the way for you to pull up. The uh case counts for the united kingdom.

The earliest is actually, by going to the zoe coped study, so check that out, zoe zoe join zoe.com covet.joinzow.com there. You go uh, zo or zoe. I don't know, there's no, why maybe i'm messing it up? I've been calling it zoe, but it's spelled zoe like joe anyway. Uh sydney is uh.

The sydney airport in australia by the way is reporting - and this we're seeing these same kind of fears in america that international travel has fallen by 86 in the first two weeks of december compared to 2019., that's insane, uh 86 declined, and so these are the kind Of fears that we think might come to america in the american stock market, where you're going to see potentially a big old recovery, sell-off, that is, airlines, restaurants, hotels, selling off substantially, especially, as this case count goes, parabolic, uh and just straight up exponential and at the Same time is the fact that we still have a delta surge in america, which is going to lead hospitalizations and deaths to go up at the same time. So we're going to reach to this future critical point, this critical point, where you're at peak omicron cases at the same time as peak deaths and peak hospitalizations, and not all of those deaths and hospitalizations, will necessarily be omicron. They'll just be left over from delta, but that'll be just sort of like all right now that you're already weak and dealing with all these hospitalizations and deaths. Let's give you a massive surge of army anyway, omicron uh worth noting that uh continuing on this worth, noting that the royal caribbean ship, the symphony of the seas, which honestly, i believe, that's the biggest ship they have, but anyway, this symphony of the shield.

It's certainly one of the largest they have. The symphony of the seas had 6091 passengers on it and they just had a covet outbreak. 48 passengers and crew tested. Positive 98 of the individuals on the cruise ship were vaccinated and individuals are reporting that they either have mild symptoms or are asymptomatic uh that two percent could be children under five.

Remember that uh right now, studies are showing that uh two shots for children under five is not enough, and right now trials are indicating we might have to go as high as three shots for children r5 to actually promote that immune response in children to help them. In the event, parents do want to get their children vaccinated, which i know there are a lot who do and a lot who don't anyway, uh israel is planning a new restrictions. The nba has postponed five games. France is going to pay its healthcare workers a double time, and the national institute's uh institute of health says that we are in for a world of trouble and found.

She says that we do not foresee any kind of lockdowns, but we do foresee a lot of stress coming to our health care system. Furthermore, jp morgan tells us the following about the market, saying that there is a paradox that on average u.s stocks are down 28 from highs, and yet median stocks, uh and median stocks are down uh 21, but at the same time, the market, referring to the russell 3000 is up 22 for the year. Such a divergence is unknown to us as jp morgan and indicates a historically unprecedented overshoot in selling smaller, more volatile, potentially higher shorted securities in the last four weeks, and the narrative for the sell-off has of course, been omicron and the fed. We are seeing a lot of de-risking and short selling, and jp morgan is actually hinting that right now is potentially a time to be bullish, rather than bearish setting up those bets buying into some of this pain.

Especially when you look at how many stocks are heavily heavily shorted, here's just an example of some of the most uh heavily shorted stocks, and this is why you always want to watch the end of the video. So you get the treats which, of course, if you ever want, treats as well check out my programs on building your wealth link down below, where i share my ideas with you early uh, but anyway take a look at some of these uh heavily shortage stocks. Here, a blink charging 35 lemonade over 34 tattooed chef beyond meat over 33 go go: corsair gaming, arcimoto, big five robot shift technologies; fisker i mean bed bath and beyond you name it all these over 20 percent here and more i'll um uh, we'll we'll do a Deeper dive on some of these short stocks, but boy, oh boy, uh, interesting perspective. Here from jpmorgan and personally, i kind of agree with them.

I think hey take advantage of some of the buying, because i think some of the selling is a little bit overblown right. Now, uh over a lot of um fud fear uncertainty in doubt anyway. These are my thoughts on what the heck is happening in our market. Thank you so much for watching check out those programs and use that coupon code.

Before the end of christmas day, we do have a coupon code expiring for the programs on building your wealth thanks. So much and we'll see you next time goodbye everyone.