Okay, CPI 30 seconds from on Deck Here are the expectations: Write them down or remember them. CPI Month over month Point four CPI Core month over month point four CPI year over year six and Corey over year five five Joe Biden Gave us a heads up that this CPI report would be good. He was confident this report would be good. Did Joe Biden get a leak? Does he know something we didn't? Here we go and CPI is 0.4 It's a match on the headline month over month 0.5 A little hot on Core, Not great.

CPI Year over year matches 6.0 and Core year-over-year matches at 5.5 So across the board, it's basically a match. with the exception of Core. Core comes in slightly hot. Not ideal.

Real average hourly earnings year over year Negative: 1.3 percent Real average weekly earnings year over year Negative: 1.9 If you speculated on this one with options, I'm not sure this is going to be enough to really push us in one direction or another. That Core number coming in one tenth hot, though, if anything, is slightly bearish, that tilts slightly bearish. That moves us from a prior release of 0.5 on the month over month down to 0.4 along with expectations. But we go from 0.4 on the prior release on Core with an expectation of 0.4 Unfortunately, up to 0.5 on an annualized basis that is in line with a 6 percent annualized inflation rate now.

unfortunately. Uh, the uh. Well, that is. That's not ideal.

That's not where we want to be. Uh. However, the uh, the other numbers all matching expectations. the fact that we're coming in at six percent year over year five point, five percent core fine, uh, I I would say this is.

this is clearly evidence to me that uh, we're likely to see a a the Federal Reserve stay 25 or potentially even zero. Uh, we'll talk about expectations from different companies in just a moment and a different analysts in just a moment. But to me, this is probably enough data to really say. Look, we don't need to be thinking about a 50 BP hike.

We're like inflation is slowly trending down. It's not plummeting, right? It's clearly not plummeting inflation when we have core increasing point five, uh, in, uh, in January here and then oh sorry. this is uh, this is the last report. Let's go ahead and get the uh.

the new one. That means the BLS hasn't updated their website yet. But anyway, we get point five on the uh, uh, the headline core waiting for Okay, here we go there, we go. There's the new report.

Uh, okay, this is the one release. Yeah, this is released March 14th. Okay, interesting, let's go ahead and grab this in here. Uh, that's the same document.

Okay, all right. whatever. CPI Oh, go ahead and throw this in here, but again, slightly hot here. I Would say this probably reiterates a 25 BP hike, but if the FED is really concerned about the banking system, it is entirely likely that the FED could pause I think it's 25 BP more and done after this report.

Uh, I don't think this is uh, this is a report where we could say okay, yeah, you know the FED should pause or cut. This is probably another 25. BP We've bailed out the banks. everything's good.

Let's keep going one more 25 and we're on the right trajectory. That's the idea here. Uh, so let's see here index. so this does again show Yeah, this is the March 14th report right here: Total for all items less food and energy Rose point Five percent in February after Rising 0.4 uh in in uh in January That's good.

Remember this is the February report released in March Let's look at some of the details that we have over here. So food increased point four percent in Fab at home Rose Point three percent Five of the six major food groups increased over the month. Not ideal, although then again, it's okay if things increase as long as the increase is a slow rate index for non-alcoholic beverages. Uh, increase one percent for February Uh, on the Mormons Back at it again.

Uh Meats Poultry fish, eggs fell point one percent over the month. Okay, cool. So a little bit of a mix over here and food. Fine, you've got Energy Energy Index fell point six percent and Feb Fantastic Natural gas decreased eight percent over the month.

It shows you how volatile this stuff is. Fuel oil Rose Nine Point: two percent over the last 12 months. Uh, okay, whatever. let's get out of the volatile and let's go to the most important one.

So the most important ones in my opinion are the core Services segments. So I'm going to go ahead and pull up the detail chart and at the bottom of the CPI release, you can actually get the detailed expenditure categories chart. And we want to look here because really, what we'll look looking for and we know what Jerome Powell is doing. He's probably already done this because he gets these reports early.

It's not fair man. I Want to get the reports early too? How am I supposed to YOLO My options man. Anyway, over here, what do we have? This is what we want to pay attention to. So just so you know how this chart works.

The far right column is the seasonally adjusted, uh, month over month percent. This is generally what we use. If you want the unadjusted, you could use the second uh percent column over here. But really, we're going to be looking at the far right one.

For the seasonal adjusted, we're going to go straight to Services Over here. See, Look, this is just not ideal. Why? Why is water and trash collection? Uh, and the services for that? Why is that up 0.8 percent? That's too hot. That shows you Services Just too hot.

Domestic operations minus 1.3 percent. That's good. Moving Storage Freight Minus 3.2 percent. Fantastic.

We want to see negates. Good Good Medical good. Negative point Seven good Professional Services Negative Point Three good Physician Services Negative: 0.5 This is good. Dental service is point one.

That's okay. 0.3 A little bit hot. not bad hospital and related. Thank God Comes down to point one from 0.7 That's good.

More of these Services Coming down good. Where are we sticky? Look where we're sticky. Oh thank God This is actually a good. This is good folks.

Uh, rental inflation is sticky. Come on man. Everybody and their mom is expecting rental inflation to come down. So so this is.

this is good. It's just. this is probably one of the biggest lagging indicators you have, right? Is rental inflation point Seven percent on rent of shelter primary residents coming in with a 0.8 that's hot? Uh, 2.3 For lodging away from home? That's not ideal. That's like your Airbnb and your hotel index here.

Uh, lodging away from home? Really expensive here? up 2.6 percent. That's hot Owners equivalent Rent Still hot. Remember, rent of shelter is like over 32 percent of CPI and over 25 percent of CPI. So when you see that this is sticky over here, but you know that this is going to be coming down thanks to Leading indicators, it's a good thing, right? Look at the weights over here.

Rent of Shelter: 34 That's right. They actually increased the weight for rent of Shelter: from 32 to 34 set. so they actually made it even more painful. And the biggest component of that is owner's equivalent rent at 25.

So this rent section staying up is the hottest part here. Actually, Look at this other lodging away from home. That's the part that really ran up is barely one percent. So hotels folks barely one percent of.

CPI Who cares if hotels get more expensive? Just bring owners rents down. That's it. That's all it's going to take for inflation to start plummeting. Because look at all this yellow here.

This yellow is actually good. These are nice negatives and services over here. Health Insurance: Let's go Minus: Uh Point Uh, four. Uh, 4.1 percent.

A little more expensive to take care of elderly and invalids. Dude who still uses that phrase the CPI Is that's racist. Okay, no, that's not racist. But anyway.

Uh, so. Transportation Services: 1.1 percent. To the upside, that's hot. That's not ideal.

That's a little hot. Uh, so. Transportation Services: What's driving that? Well, what's driving? That is motor vehicle maintenance and repair. And that's only a point.

Two percent motor vehicle. Body Work Guys Stop working on the body Point: Nine percent over here. Motor Vehicle Maintenance and Servicing Point: Five percent. Motor Vehicle Insurance Dude Insurance has been skyrocketing.

It's a pisser man. Everything's going up with insurance. Look at home insurance too. Anyway, point nine percent over here.

Parking and Fees: Okay, that's not that big of a deal. Public transportation? Come on man. the government should be able to rig this one. Three Point Four: Two percent for public transportation? Good.

Lord How are we back to airfares going up now? Airfare is only a 0.57 weight, so again, it's It's a drop of the bucket compared to rents. But geez, Lord 6.4 on airfares and you just destroyed the down of the last two months. It's actually interesting Morgan Stanley had a a had a heat uh map of airfares and they're like, we think more planes are flying now maybe that's just my plane I Like people like: Kevin you're not gonna fly enough to justify a plane I Flew 70 hours in the last 30 days. If you annualize that out, that's like flying 840 hours in a month.

That's insane. anyway. uh, inter-city Transportation down. Okay, so in other words, it's uh, probably the outside of of city transportation.

Well, it's really airfares that are driving this Transportation up in public transportation Recreation Services that's still hot. Why is Recreation coming in so hot? That's not ideal Recreation Coming in at one point two percent I mean that's like 12 inflation so that's not great. Cable uh, cable and satellite streaming video disc. Who still buys that Pet services.

Interestingly, we saw leading indicators. even a course member. uh, remember, we got a course member coupon code linked down below. St Patty's Day price will be going up after it.

But anyway, a course member emailed me and said hey, I got a pet shop We're still raising prices the first few months of the year. So what did I do I Went and looked at Petco and the other pet companies earnings calls and they're like, yeah, we still have some leftover price increases coming for the first quarter and first half of 2023. But after the first half of 2023, we're done. We're not going to raise prices anymore.

Now That to me is actually really interesting because it's a leading indicator. Leading indicators matter what we're looking at. right here is a little bit lagging. What are the leading indicators saying the leading indicators are saying? Yes, there's still a little bit of pipeline inflation Yes Walmart I Still had to raise wages? Yes, McDonald's still had to raise wages a little bit.

But what is the leading information? Well, the leading information is, don't worry, inflation is trending down. Yeah, yes, maybe a little bit left in the pipeline, but that's normal. Okay, so I'll also tell you what the suits are saying in just a moment. Education com Services That's nothing.

Point Two percent. Honestly, a lot of these services are coming in pretty soft. Postage and delivery 0.2 Tuition and Schools Point one: This is actually fantastic folks. This is actually a pretty good report.

Other personal services that's pretty hot 1.1 That's not great. That's going to be like your haircuts. that's probably the last place you would expect to see softness. miscellaneous personal services like Legal Services up one percent that's not great laundry apparel Financial Services Man, those Finance people raising their prices all the time.

Dang it. Uh, by the way, have I mentioned that we're raising the prices for the programs and building your wealth. Link down below: Use that same Patty's Day coupon. Get in before we raise the prices.

You get a price guarantee once you're in. so you get the best price for life. But anyway. I Have to say personally.

First, uh, you know, glance at this. This is actually a very good report and what? Okay, all getting cheaper. Oh damn, who wants to go out? It's on me. Uh, alcohol going down 0.3 percent other Goods a little hotness there on Goods 0.7 on other Goods but that's like to back tobacco Sporting Goods Point two: that's fine.

There's the Pets product. We knew that would be a little hot. Uh, and that's sort of the pipeline. We just talked about.

Education calm coming in. Negative Point one: Uh, look at the vehicle segment over here. Used cars and trucks still coming in with a negative 2.8 even though leading indicators are suggesting this should be actually Rising uh I Think the seasonal adjustment is really well, even unseasonably adjusted, it's negative over here. So I Don't know if there's a lag here because we do kind of expect used cars and trucks to start popping again, but so far they're quite negative over here now.

I'm going to jump into what, uh, the suits are saying I Want to get there. Look how the hell is apparel A point point: Eight percent? What is this Are you telling me? Lulu has PP again after I thought they had no PP What is this? garbage? Household cleaning supplies 0.5 tools and hardware. and Outdoor Equipment Stop spending money 2.7 percent? Uh, all items less? Okay, that's fine. What do we got over here? Uh, window floor coverings minus one point Three percent.

Hey, that's good for house hack, living room furniture. That's good for the Airbnb hack. Negative point: eight percent Furniture Betting only two percent. That's fine.

Okay, good. so this Appliance is popping up a little bit. Okay, not ideal, but but all right. I'd say overall, this is actually not a scary report.

Let me see what the suits are saying to me. this is actually suggesting that we have, uh, some, uh, uh, disinflation. Fine, it's lumpy, right? It's lumpy. It's like ah, some of the things that were following last month arising.

now. Yes, it's lumpy. but the biggest thing that's keeping this up. The only thing keeping this up is the Viagra of housing.

That's it. Otherwise, otherwise this thing would be so soft it would be the softest uh CPI report you've seen in years. Anyway, what are the suits saying underlying U.S Consumer Prices Rose in February by the fifth by the most in five months. That's the point.

Five percent an acceleration that leaves the fan into tough place as it seeks to thwart rapid inflation without the turmoil of the banking sector. Yes. Bloomberg Intelligence: Chief says data is just long enough to think it clears the FED for 25 BP That's what I said the first like minute of this video. I Think this nails down 25 BP I Agree I Think we've got one more 25 BP in us and that's probably it.

Uh, core. Services X Inflation while stubbornly high Ticking down, we're down now to an annualized increase of a 6.14 uh, down from 6.2 percent. This is actually good. Uh, so I I Like this so you could see how slow it's moving down.

Look on screen Now please. You can look how slow it's moving down core. Services X Inflation. But you know what the good news is folks.

You know what? This line right here says no Paul Volcker No Paul Volcker No Paul Volcker. That's actually important because remember Kevin Meet Kevin For the longest time has had the opinion that yes, we are going to go through hell, but we are not going to go through a pole Volcker. There is no evidence of a wage price spiral. There is no evidence of a spiraling out of control of core inflation even excluding shelter.

Yes. Is it sticky? Is it coming very slowly? Yes. We don't want it to come very slow. Come down very slowly.

We want it to come quickly, but it's taking longer. But that's okay. higher for longer is not the end of the world. It doesn't mean Paul Volcker, It means Nike Swoosh Recovery baby.

Another report to reiterate Kevin's bias of the Nike Swoosh recovery. It's true, but look, I'll tell you if if things are going anti-mythesis but so far this is. this is right along thesis here. Uh Bank of America says we're in a stress event right now blah blah blah I Want to by the way, tell you what other banks are saying in terms of uh, what? they whether they think we're going to get a cut uh, flat or or hikes I'm going to give that to you in about give me one minute.

I Want to look at a couple more things: Super Core Month over month. moving from 0.36 and Jan to 0.5 in Feb Not ideal. That's that six percent rate. Uh, that's six percent annualized rate.

Again, we'd like to see that coming stuff. but again, no. Paul Volcker. Yes, higher for longer, but no problem.

Uh, okay. we those were all just the data report. Okay, so I've already gone through this one last thing. Core: Goods Inflation cooled.

Cursed course. service. Inflation is marching higher. uh, on an annual basis.

Uh, yeah, but that's annual. Okay, we just looked at Core Services Um, month over month. Which is more important. Yes, annual is still technically lapping numbers and still trending up.

Not a biggie. Okay, now what are the suits or what were the suits saying before this report now I Want you to keep in mind what I'm about to read you is not another coupon code pitch. It is not suggesting that you should go to Metcaven.com life to get life insurance in as little as five minutes or go to Metcaven.com Weeble to get yourself free stonks. It is simply to say that Bank of America expects a 25 BP hike.

uh in March Uh City still expects a 50 BP hike in March due to a hot fed uh or hot jobs report. Uh and this probably reiterates that the CPI report we just got reiterates it. Why? Because guess what? CPI called it or or Citibank called it the Citibank said we actually expect Core CPI to come in hot at point five percent month over month. Guess what? It came in at point five percent.

So Citibank actually thinks the 0.5 that we got yes or that we just got on. CPI reiterates a 50 BP hike I Don't think so I think 25. I think we got one more and done one and done. Wham Bam Thank you All right Barclays expects a pause or a 25 BP hike because of the banking stress.

In my opinion, after the CPI report, it reiterates 25. Goldman expects a pause due to uh, the plummeting basically of of yields. They think the market agrees with them. so Goldman is expecting a pause.

JP Morgan expects a 25 BP hike. Credit Agricultural expects a 25 BP hike Deutsche Bank expects a 25 BB height. Now here's the interesting: Xbox a 25 basis point cut and half uh oh sorry and halting balance balance sheet reduction. Boy, that's a mouthful.

They actually think no more research actually expects a 25 basis point cut. and they think the FED is going to pause quantitative tightening because of the buy the FN fed pivot program. It's not actually what it stands for the Btfb program anyway. Uh, some people are calling it dead.

but anyway, uh, no more research thanks to Btfp program is insufficient to maintain stability in the financial system. As a result, the FED is actually likely to cut by 50 basis points and stop QT Crazy. They're the only ones saying that Jeffries expects 25 BP regardless of whether CPI comes in slightly hot or slightly low. Okay, TD Bank thinks 25 thanks to the Silicon Valley Bank uh, uh, a program, a TD Bank Went into this thinking that Core Services remained strong and that disinflation from Core Goods is fading.

Yes, that's what we saw. Conclusion: Most of all of the analysts on Wall Street are reducing their expectations for a a Fed hike to 25 BP Some of them are going wild. Yeah, analysts gone wild. Oh, that sounds like a fun party anyway.

Uh, they they only no more research thinks we're going to have the potential of seeing a 25 BP cut. Now what is the market saying as of minutes ago? Well, the market is suggesting that we're probably sitting at about a 91.5 chance of a 25 BP hike and only about an 8 chance of a pazola. What is the terminal rate expectation showing? Let's take a look at this. Uh, so let's see here.

terminal rate expectation up now up to Oh my. God What a roller coaster This is stupid. This: This is just stupid. 4.95 Okay, why am I frustrated in saying this is stupid? Because look at the chart.

Look at this nonsense. That's what this is folks. It's nonsense. We literally sat at like 4.9 to 4.95 right? We literally sat right here for what four or five months this is like.

September October November December It started rising in uh and and well really started rising in February So maybe I'm a month off. But anyway, let's say whatever. October November December January Basically for four months we were stuck at 4.9 Then we had these hot January reports and we went to hell. And then we had a banking crisis and we came back from hell and look at where we are now.

This is like the most flip-floppery Market I've seen in my life. Look at this. We're literally where we were sitting forever. What a joke.

What a joke! We're right back to where we were sitting forever. All the drama of February and the last eight weeks is basically like JK Good Lord Okay, what about Goldman Sachs Financial Conditions Goldman Financial And then we I want to look at Inflation Break evens. Let's take a look at how people are reacting over here. so inflation break evens? What are they sure? Goldman Sachs Financial Conditions index sitting at 100.

it's actually good. They're tighter than where they were at the end of January. They're not as tight as what we saw in September or October but they're good enough to where I think Jerome Powell says hey, look uh Financial Conditions are tight. We're good.

We could do a 25 BP and chill. You know it's like Netflix and chill. except you know in Fed world it's 25 BP and chill. Let me show you that chart.

so look over here if you zoom in. Okay, so here's Jan Look how low we got in terms of financial conditions when we got the Hot Jobs report. Guess what Jerome Powell said when we got this: Spike Oh, Hot Jobs report. No, it's it's not a problem, you know Financial Conditions already reacted to that.

That was the reaction he was talking to look at what we ended up getting. Bubba I Mean it is entirely possible that with the financial conditions this tight, the FED could pause I Think it's unlikely. Dude, you know how many people yelled at me on Friday when I said I think this banking crisis makes it more likely for us to have a pause than 50 BP That doesn't mean I think a pause is more likely than 25. I think 25 is most likely, but I said immediately.

25 most likely maybe pause, but no more 50 After the banking crisis, people got so mad at me. now all the analysts are saying it. Anyway, Okay, now we have to look at the five-year break. Even five year break even.

By the way, thanks for being here. I Like hanging out with y'all uh, it's it's really cool. Uh yeah. I know it doesn't seem that way because I'm all alone.

technically. uh, but uh. but really, it's it's like we're at like a Super Bowl together. maybe not a Super Bowl, like a concert 17 000 strong concert and you got literally some dude wearing a Christmas sweater.

Y'all showed up to a concert with some dude who can't sing a Pokemon in RuneScape coffee mug talking about inflation Man who's more weird, you or me, all of us. Okay, what do we have over here? Uh, but we could be weird together. So what do we have over here? We have. uh, what is this? This is the uh.

five year Break Even Okay, all right, that's okay. that's okay. Look at that pretty stable over here. I mean I that's probably the app.

wouldn't have it any other way. That's probably average of what we've seen since. September I Mean let's draw some lines here. I Mean who doesn't like drawing lines on sticks? Uh, okay.

so um, let's see here. So we we did not hit a higher high here. That's good. We did hit a higher high compared to October.

But are we continuing the downtrend? I mean somewhat. You could kind of say we're continuing that downtrend. I Mean if I draw the line here, it's better. It's not as strong as the downtrend that we had, which was probably more like this.

Uh, what if I draw? You know it. It really shows. We're definitely above me. a median here.

see this was this was more of a solid downtrend right here. and we're certainly above that. You know we should be a little. We should be about 10 bips lower right now just based on this trend right here.

Uh, so you know we got this is really consistent with higher for longer, but it's certainly not a Paul Volcker. Paul Volcker would look like this. I Guarantee you if we had inflation that looked like this, uh, or break even expectations that looked like this I guarantee you we'd be at 10 interest and we'd be getting Paul Volcker. We're not we.

This is not. This is not a Paul Volcker. This is a hire for longer. Buy the F and dip.

That's what it's telling you. It's by the day because it's just slowly going to Trend up uh in a Nike Swoosh style recovery I Know people get mad at me also for saying that, but then what? Then again, you know I've gotten to the point where people just get mad at me forever I just I don't care anymore. Uh but anyway yeah so I have to be very clear about this because people hear Nike Swoosh and I think they just see this. uh I think the better way to look at this is probably something like this and then like this but this being very very volatile.

but I Personally think that we're going to look back and say wow that year to two years period of time between mid-2022 and maybe you know the end of 2023 that was a in Time to Invest You were able to invest a pretty reasonable valuations. Good thing I Signed up for meet Kevin's Stocks and Psychology of Money and zero to millionaire real estate course or the Elite Hustlers To learn more how to make money as an entrepreneur or as a as an employed person I learn everything I need to know about Lscs or tax benefits or whatever because yes.