Hey everyone we kevin here, let's talk about what joe biden just said and then we'll look at how the market's reacting to what joe biden just said about russia. So joe biden said that yesterday russia announced it's carving out a chunk of ukraine. This keep in mind was the day after the olympics ended as we suspected, because russia has great relations with china, one of his remaining friends in the world and doesn't want to take too much of their limelight away. Although he's kind of already done that beforehand, joe biden goes on to say that today, vladimir putin is already extending the size of these areas deeper into ukraine, setting the rationale to quote: take more land by force.

Joe biden says this is the beginning of the invasion which they essentially outlined at the un security council last week, with secretary of state blinken now uh, he joe biden did mention that the united states is going to act, starting today with worse sanctions than were imposed On russia in 2014, which was when crimea ended up being annexed, he states that russia has undeniably moved against ukraine here and the sanctions in the first tranche or sort of first basket of sanctions, leaving the door open to other tranches or groups of sanctions. The first trench will include full blocking sanctions for the veb. This by the way, is the largest economic institution largest investment corporation in russia. It's it's essentially a lending institution, i kind of think it uh.

Think of it as like, and and this is not the best analogy but uh, you know how we have fannie mae uh in the united states to give us the 30-year mortgage. Well. Think of it as like the fannie mae for everything, except in russia and their military bank, both of those are being fully blocked, they're also limiting russia's access to investing in sovereign debt or trading sovereign debt. So that means if russia is holding - let's say, u.s treasury bonds, which every country in the world holds u.s treasury bonds, and then they want to sell those bonds to.

When you sell a bond, they have value right now, bonds have nominal value, and then you want to get cash. You might not no longer be able to sell that sovereign debt in normal markets, meaning you'd, have to go. Take a haircut and sell it for a loss somewhere else or or for a discount somewhere else. That's essentially a way of trying to cut off their financing from either euro or eventually europe, depending what we get from the eu and u.s debt instruments uh.

They will also starting tomorrow, sanction the elites and family members of the kremlin. Now these sorts of sanctions are kind of interesting, because the way you have to look at it is the the elites and and wealthy people in in russia. They often travel right. I mean think about it: uh like going to france or going to spain or anywhere they want to travel.

These things are going to become a lot harder, if not impossible, for those individuals - and i think they're doing that, because what do rich people do in america? Rich people in america they start texting their congress folks because they're like yo, i donated to your aws, and now i can't call santro bay, i'm pissed! You get putin on the phone right now and, and you stop this ukraine madness, because you're screwing up my vacation plans and if you don't, i i ain't donating to you anymore, you're, like terrible accents, not even suggested. I don't even know what kind of accident that is, but the point is that's why that matters, because when you piss off rich people, they get pissed at the politician. If you think about it, it actually goes to show you how kind of corrupt things are, because it's like wait really. You have to punish the rich people uh yeah, because they do have leverage over the politicians nothing anyway.

This is not a laughing matter. Okay, invading ukraine is not a laughing matter, especially if we go into like the capital. We actually start getting armed resistance. Oh then, we talk real bloodbath.

Okay, that's terrible men, women, children! Nobody deserves this. All right. Uh putin has received the authorization to uh use russian troops from the duma, their their parliament outside of russia. This is important because you've got to remember using their troops outside of russia basically means in ukraine.

Okay, that's bad! That's that's not good, and the dumas like yup go. Do that peacekeeping, and you know what uh putin said this earlier today and come on. You know what this means: okay, putin's like oh, you know, there's no telling what the military will do when they're there peacekeeping. I don't know what they'll do.

This is essentially what he said, i'm paraphrasing because you have to translate, but but it's another way of him saying like yeah, put them there for peacekeeping if they uh, if they have to kill people. Yo people he's almost kind of like washing his hands of of like i don't know what they'll do whenever i thought that was crazy, that he said that, but anyway, uh joe biden did reiterate the affirmation for defending nato authorizing us forces to estonia, latvia and lithuania. Building up that nato force it honestly, it wouldn't surprise me if there are actually u.s forces in ukraine like secretly training, uh and and helping plan uh with you know you essentially the ukrainian military uh. I i don't know that uh, because biden says we will not have troops in ukraine, but that's usually what they do anyway.

Uh still 150 000 troops surrounding ukraine missile cruisers, subs amphibious assault vehicles, moving around the baltic uh. They did coordinate with germany on canceling. The nordstrom 2 pipeline biden made this promise and it happened uh a good coordination there with germany. This does upset some of the european countries, though, like italy, because they're like come on man, the inflation's already really bad.

Please make it stop uh and it's it's true uh. It kind of sucks, but uh, then uh. If we look at just briefly taking a peek at brent, is at 96 wti at 92, so actually kind of stable, not as high as what we had earlier. When we first heard about the uh pausing of the north stream, two, which was really supposed to bring prices down anyway, uh joe biden says, we've seen a major increase in false flag events of recognizing sovereign territories as independent as a clear violation of international law.

Don't be fooled, there is no justification for this. Okay. Let's now look briefly at what's going on in the market here, so a couple, important things that we have to look at, i'm going to hide myself for a second, so you can see this easier. Thank you.

Bloomberg for this so see this right here, folks, okay, this is the 10-2. The 10-year two-year treasury uh spread. It is now at the lowest point. We have hit right here, this 39.61.

We are now officially lower than where we were last week. This is when the sort of meeting was declared between biden and and putin. Assuming there was no invasion now, there's an invasion. So it's like.

Oh my gosh. Does that mean this is going to get cancelled, uh kind of a little bit of a mess here? This is bad. This gets to zero or even like a hair negative. It usually indicates a recession within the next year, so so not so ideal.

The ten twos are not happy. One of the reasons this is happening is because we're seeing uh inflation expectations actually increase. Uh, because of this, this here is the five-year break-even chart we like to use this for inflation expectations. We had our biggest inflation fears here in october november, which came as a result of all the drama coming out of delta right over here, which we actually had very low inflation expectations over the summer.

It was really this this period of time right here was when people kind of started, somewhat freaking out about inflation, and they were freaking out over here, because we had those big year-over-year prints, but there was an excuse for it. It's like oh well, we're comparing back to march april may of 2020 when we base almost had near deflation right uh. This over here is is again post delta, and then this is now - and you can see this trend line here - is - is pretty clear that uh, if anything, we're ramping up here on these inflation expectations, so not good uh, then what else do we have? Well? We've got the s p 500, which really just likes to play bounce i mean it is hilarious, how much it likes to play bounce on my lines here. So uh you, you know these are the same lines.

I show you every day i tell you when i move them. I haven't moved these at all. It's just ridiculous. I mean look at this.

At the morning we went to 4 30 bounced up got rejected at the 23.6 fibonacci we broke straight through 4 30.. We just did not even care about breaking the 4 30 midday here. We did try to recover, but then that 4 30 became a solid resistance point, at which point we got clearly rejected here. Uh and uh take a look where we're bouncing.

Now we are basically getting ready to bounce off of the 400 uh. Sorry, the 420 resistance uh, i'm sorry fibonacci support line. Now right now we are at this sort of intermediary line that i have drawn, and i've had this one here for a while. It's at 426.49, 420 57.

Is that zero fibonacci? This is the low point that we hit in january. I think that was like january 24th, or something like that anyway, right now we're sort of bobbing between this area here so we'll see what happens we'll see how the day ends. Obviously a volume spike over here when biden spoke, we did actually get a little bit of a run right here, as biden was speaking, we hit our low right before biden. We hit a sort of an you know, 30 minute, high or whatever, when he finished and concluded.

I do think the market was expecting a little bit more in the first tranche of uh uh of of uh. Well, this uh this uh response with sanctions, the uh. It's worth noting that earnings season is almost over and in three weeks we have to deal with the federal reserve and whatever crap they're going to tell us so a lot of crap ahead of us folks but uh. Thank you so much for watching this video.

If any of this stresses, you out make sure to get life insurance in as little as five minutes go to kevin.com life and, of course, if you want to join me on those live streams, you get those daily market open, live streams by the link down below Joining any of those programs thanks so much and we'll see in the next one goodbye.