Greetings and welcome back to a monthly cpi report. We are about to get the cpi numbers for may it is a friday june 10th cpi numbers come out within the next 60 seconds. Here are the expectations we are expecting a month over month, read of 0.7 we're expecting core to actually move uh to 0.5. That would be down one-tenth of a percent.

Month-Over-Month read at 0.7 actually being up from point three last month. Point seven as a read is eight point: four percent, an annualized rate which is pretty fast year over year, we're expecting that top line, sort of drama. Mama number to be eight point: three percent we'll see what happens: we've got expectations for consumer sentiment and consumer inflation uh, hopefully staying stable at 5.3. Those will come out in about 90 minutes, but right now all eyes are inflation on inflation.

I do not personally believe that we're going to have a big move to the downside in terms of inflation, yet i think we're probably going to have to be patient and wait till probably the august cpi anyway. Here we go all right: cpi numbers coming in uh any second. Now it is okay, uh cp! Oh my gosh! It's terrible cpi year over year 8.6 bad miss month over month. One percent - this is that's, not good.

The stock market's gon na go straight down. Oh, my gosh, that's bad uh cpi, excluding food and energy on the month. Also missed 0.6, as opposed to the 0.5. You've got uh.

Let's see here, uh, it's just bad yeah nasdaq just dropped like one percent like instantly uh, i'm gon na go ahead and pull up the actual report to see where we missed. I'm gon na guess. Uh. We're gon na have some kind of bad news coming in.

At uh, probably travel uh airlines somewhere around here, we'll go ahead and figure that out but boy, oh boy, that's uh! That's a pretty pretty gnarly miss uh on across the board, and it just shows you that the the estimates that we get right now from a lot of these uh the economists are are just bad, just getting bad estimates but uh, let's see here, okay, all right! Well, anyway, uh i'm gon na go ahead and pull up the actual dock here or give me one sec, but uh. That's that's a big miss again. If you're just now joining month over month with the expectation was 0.7, it just came in at 1, the excluding food and energy core came in higher as well at 0.6. That's a 7.2 annualized.

Here's the actual dock right here, uh all right over the last 12 months, all items increased 8.6, that's the headline. That means we're going back up right, we're not actually trending down anymore. I think this pretty much seals the deal for a 50 basis. Point hike in september, uh uh, certainly in in july, we're going to get in june and july we're going to get 50 bp hikes we're going to get the federal reserve's dot plot next week.

That's the summary of economic projections, the scp! We don't get those every time the fed talks, but this this one's bad. Let's see, i want to know what increased so the increase was broad-based, see, that's terrible like these are the words we don't want, with increases for shelter, gasoline and food being the largest contributors. So shelter this is something we talked about in my preview video yesterday. That shelter is going to be something that's going to continue to be this tailwind of more inflation for us, because it takes so long for real estate prices to really work their way into cpi.

So where, where did the disaster come from here because i mean all items up: one percent bad food away from home 1.2 percent of the month. It's just it's just a food, i'm sorry food. At home, 1.2 percent food away from home 1.4 energy 0.7 we've got uh new vehicles up, one percent used cars. What the hell look at this used cars were negative, negative, negative and all of a sudden up 1.8.

Like that was supposed to be uh, one of one of the anchors to bring things down look at this apparel was down last month or in april what all of a sudden up, 0.7 percent shelter, also ticked up shelter, has a one-third weight. That's point: six percent for shelter: that's shocking! Yeah! Let's see here, cereal bakery products up one point: five percent in in may: we've got food at home, eleven point: nine percent over the last uh 12 months. Let's go ahead and look at some of the actual tables. Here and what other information we can glean from this, but it's just not good uh, let's go to detailed cats all right here we go! So if you look right here this column, this that's going to be the third number.

That's going to be the month-over-month change and now in a little bit more detail, and i want to see the airfare so airlines airfares - oh, my gosh, 16.1 percent, again public transportation up 11.2 percent. This follows the the craziness that we had last month, which uh was the uh, which would have been the march to april change and just pay specific attention to how these are changing here. On the left side, you have the unadjusted number and then you have a seasonally adjusted number on the far right side, so we can look at kind of both of those uh yeah. I mean even with an adjustment here.

The numbers are just terrible: uh, seasonally, adjusted you're at 12.6 percent on a month-over-month basis for for airlines like we still didn't see any weakness there: public transportation, 8.6, that's adjusted, yeah, that's just wild motor vehicle repair, uh 0.5 seasonally, adjusted car and truck rental 1.7. That's double what we saw uh of as an increase. Last month i mean this is just such a bad. Miss, okay, yeah, brutal okay, so looking at the wall, street suits response to this uh.

The first line i got here is ouch headline and core both exceeded expectation, with top line figure hitting a fresh 8.6 on a year-over-year basis, uh looking for silver linings, but there don't seem to be any uh. The fed is clearly behind the curve. Okay. This is what the suits are saying: gold is hitting a low for the session following the report.

Gold now down, one percent uh, here's the bls description from what happened with core the index for all items. Less food and energy rose point six percent in may the same uh increase as in april. Oh so they adjusted april up as well - oh great, because that was point five percent, but anyway, with all major components increasing over the month with the largest contributors being for shelter, airline fares used cars, trucks and new vehicles. The fact that used cars came back as being another uh, you know, tailwind for for increasing inflation is terrible.

Let's see they're now calling this one step forward. Two steps back. This indicates breadth of inflation, nasdaq, obviously, and s p, spiked, lower uh. This is a new 40-year high for inflation.

Many thought that march was the peak. That's not the case, maybe now's the peak uh bad news for the fed bad news for the white house, bigger than expected, with no deceleration yet uh broad advance again reiterating that the federal reserve is behind the curve. Like stocks bitcoin plunged as consumer prices, surged bitcoin down to 29 at 5, 30 right now, let's uh just look at the chart here for a moment. Yeah, look at that nasdaq down 1.33.

Look at that that instant drop here it looks like we're getting slight little rebound here now sitting at about 293 295 for the qqq is still above the lowest levels. You can see tesla down two percent still above the lowest levels that we've seen. If we go to the day, chart right here, we're going to get dragged all the way down to about here the chart uh the line, obviously isn't isn't present yet because we're just in pre-market here, but we're going to get drive to about where the mouse is Right here, uh still above that 280 level, which is uh, which essentially the lowest level that we've been but uh boy - oh boy, okay, let's uh go back here for a moment. I do want to just shout out that this video is brought to you by stream yard and it's being a live stream by stream yard.

That way, i can throw up comments like uh, like this person who goes, do you even lift bro, and the answer is: do you even go to the moon, and the answer is no, but anyway go to kevin.com streamyard to learn more about streamguard. This is a very terrible uh cpi report, but yeah as i throw up comments or as i'm live streaming and switching around stream yard allows me to do a lot of the work and a lot of the heavy lifting, and i can multi-stream to different platforms as Well, so give them a peek over at mattkevin.com streamyard or in the link down below so uh. Looking at just for a little bit more nuance here again, it's very difficult to see it. I'm looking for just negatives to see any sign of hope here: financial services down 1.7 apparel services other than laundry and dry cleaning.

What the hell is that uh 2.6, like what? What apparel services is there other than dry cleaning and laundry? I mean tailoring okay, fine tail rings down: okay, internet uh. What about computers like that? That's interesting or or information technology commodities right. Can we get a little bit of an update on these? Let's see here, uh, let's see personal computer. Can we get computers, uh computers? 1.4 to the downside for computers and smart home accessories information technology, commodities down 2.2 percent, that's good telephone hardware calculators who buys a calculator anymore down three point: two percent smartphones down five percent uh: keep in mind that taiwan semiconductors - we were talking about this in the Course, member live stream yesterday, cores which i'm doing every day the market is open.

I'm doing uh course member live streams when i'm in the office every day, the market's open we're doing course, member live streams. We're doing these fundamental analyses now on because there's so many companies and and the deals just keep getting better. So fundamental analysis is like fun again, like it's been made great again, but anyway, yeah we're looking at taiwan, semiconductors and uh. One of the things that we're noticing they're saying is yeah.

There is less demand for smartphones, but they're able to shift from smartphones to uh to making more ev chips and kind of keep that demand strong with taiwan semiconductors. So it's kind of an interesting argument: education, communication, commodities down a 1.7 percent point: six percent on toys, games, hobbies and playground equipment; okay, uh. Let's see video audio products televisions there. You go that's sort of like your consumer discretionary over at retail walmart right down.

Three percent again, though, i am blown away that newbie it to me it just it feels like the cpi should be called cp lie because they literally screw it up every month. It's like how. How are the economists so off? I don't know uh but uh whatever new vehicles, one percent after rising 1.1 uh, seasonally, adjusted and and then again with the used vehicles. Look at this folks, we were negative.

This is on seasonally adjusted. We were negative 3.8, then negative, 0.4 and now all of a sudden back up 0.4. This is ridiculous. Just ridiculous uh, the sticky components of the okay.

I mean everything's up core cpi, actually increased yep. We already know uh traders, price three half point hikes over yep june july september. That's exactly what i was thinking is that uh. This is the nail in the coffin for that 50, bp hike in september.

That makes a lot of sense to me because, again, the expectation gosh inflation breakevens just shot up as well. The the expectation is that we're gon na get if we've got the 50 bp hike in may we're going to get it in june. We're going to get in july, we know that. That's that's basically priced in at this point, but the market doesn't really know what to price.

In for the meetings of september november december, we could get 50s in all of them. We could get 25s in all of them, but now after today's report, the market's like yeah, it's probably going to be 50 in september and maybe 25's in the other two, so inflation break evens, just uh jumped uh substantially. At the release of this report, we were sitting at uh 3.1 for inflation break evens the five year break even just shot up to 3.14. It's actually a good move up the la we are now at the highest level since about february 25th.

We're definitely still substantially down from our march and april peaks, but boy, oh boy, this is uh. You know certainly something that's uh, not great. Let's look at how 10-year treasuries are moving after this, so bonds, actually down 10-year treasury down about four basis points to roughly three percent. You've got oil moving up about half of a percent oil and then gold, now down about 1.33 btc sitting at 29, 757, so rebounding a little bit and then of course, uh indice futures, also down with the dow down .89 s p down one nasdaq down.

One point four: two uh: okay, let's see, if there's anything else, the suits have to say for us uh, okay, yeah. Actually i want this chart and i want you to see this chart so one second, this. This is exactly what i was waiting for all right. This gives us sort of a heat map for where the pain is sad day, yeah no kidding.

Now this is uh. I you know it. It was not my expectation personally that we were gon na see any like large deceleration, but was did i expect to see a one percent month over month, no way, no freaking way. I mean that's it's terrible, because a one percent month over month is a 12 annualized rate of inflation means things are getting worse, not better right.

It's just terrible all right. Take a look at this chart right here right. This is uh. This is our heat map for inflationary items and uh.

What we're gon na see here is uh the weight on the left and then the uh annual uh sort of change that we have in in some of these prices as the first column here, and it really shows you where the big pane is with the red. The red is the real pain and we've got boy. I mean we've got a lot of red so anyway, let's and then i'll go to a month-over-month version of these as well. So this is uh okay, so in the way they did this is this is an annualized, so they've already multiplied this by 12..

This is a two-month percent change in cpi components annualized, so they take the two-month average, multiply it by 12.. Okay! So now we know exactly what this is. That means an annualized rate dairy, which has almost a one percent, went out of three quarters of a percent of a weight, 37 percent fruits and vegetables. One point: four percent weight sitting at about only a 1.6 percent move.

Also, fruits and vegetables are getting that much more expensive, but meat 16 food in general, 13 energy 6.8. But if you look at like fuel and oil, uh 161 percent annualized rate, but we don't want to look at an annualized rate for that, because obviously you're going to have spikes apparel still actually on the two months down 0.55 household furnishings and supplies up 3.89. Alcohol is up 5.35 education, communication commodities that one's down nicely 22 on that annualized basis again, two month, average medical care services. 5.92.

I mean you really are seeing just a broad-based amount of pain. There's there's very little sign signs anywhere of of a relaxation. So another thing is: eggs are up five percent in may i don't know what is it with eggs? It probably represents a lot of freight. That's that's built into that as well, like fuel costs and such, but it's quite bad all right.

So again, if you're just now joining, i want to just give you a summary of of the disaster for uh. First of all, the expectation was a 0.7 on the month. Over month we got one percent, which is terrible, uh, really terrible number. We got the highest inflation rate year over year.

In now, 40 years we were going down. We were like oh look, we're actually starting to trend down yeah that u-turned. We went up 8.6 as the headline pretty terrible, uh and then even core beat the estimates. Now.

Uh this is the. This is something that we talked about over the last couple days and it's sort of this projection of, and this is right before the cpi came out. This is a projection here of. Where do we think inflation's going to go and you can see the dotted line is roughly where we are, and so bloomberg economics was actually projecting that the purple line uh, which is your total cpi, would would actually stay below that peak that we had in march.

But wasn't actually going to decelerate until probably the end of the year, and even even this chart was wrong because we now have a new peak uh and that new peak again is pushing spy down one percent, the qqq down one point: three percent wow: okay and Inflation break evens up. So that's pretty bad sorry that i wore the to the moon shirt and brought the green background. It didn't work, it didn't work. We got screwed! Oh well, thanks! So much for being here check out the programs on building your long-term wealth link down below biggest and most popular course.

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