Welcome back to another episode of the Meet Kevin report we are live with episode and number 77 already and it is April 9th Easter happy Easter Everyone to uh those of you who celebrate Easter and if you don't celebrate Easter well then happy Sunday and happy. Whatever it is that you may be celebrating. we've got a note to talk about. As usual, it seems like I say that every day maybe I don't even need to say we have a lot to talk about because there's always a lot to talk about I almost generally run out of time things to talk about but it's so fun because there's always something new going on and I love that.

uh so we'll chat uh about various different things. Today we'll talk a little bit about uh the IRS the uh, we'll talk a little bit about uh what the economist thinks about, uh the stock market. We'll also look at uh, sort of the the decisions the FED is facing. We will.

Let's see here. look at there we go. I will look at what Tesla yeah I think I already mentioned what Tesla's up to what China is doing and how that uh is a little different from what we talked about yesterday or is it. We'll also talk about the document League a little bit about Bitcoin So we've got quite a few things so let's jump.

Uh, let's jump into it. So the first. Oh yeah, and we have to do our CPI preview as well. So I think the first thing we can actually knock out uh would be a catalyst preview for this week.

So uh, let's do the Catalyst preview first. and uh, from there, we'll go ahead and um, fit into the other topics. So should I buy? Let me make sure I have them I have them ready to go. Everything is ready.

Okay, all right folks, this is a big week. We've got April 12th coming up, which is a CPI week. That's potentially more important than Jobs Data Week, which is wild to say, but potentially is more important than Jobs Data Week. In addition to that, we're going to talk about how the Federal Reserve likes to make decisions, how they kind of messed up potentially.

Last time we'll talk about Nick T's latest argument on the Federal Reserve We'll also talk about the economists attack on what's happening with the stock market. so a lot of things again Catalyst event fed. Then we'll talk about uh, the stock market and uh, and potential movements coming up this week. So the first and by far biggest Catalyst of this week is going to be CPI.

But not only are we going to get the consumer prices, we're going to get some earnings reports and a few of them will actually help us. Uh, well, actually really, just one of them will help us potentially right before CPI And in my opinion, that's Carmax Carmax reports at 6 58 am scheduled to at least on the 11th. that's in two days. That's Tuesday morning.

So we're going to be getting at Carmax report and uh, the estimate they're looking for about 22 cents. But why CarMax Well, one of the reasons I like CarMax is because obviously they're a used car dealer. One of the things that we're seeing is we're seeing used car wholesale prices rise, but used car prices aren't necessarily coming up with how much those wholesale prices are rising. So what that means is if input costs are up, but consumer prices are staying limited, margin is getting squeezed right.

so we would expect. if we think inflation is going to come in softer, we would expect that potentially CarMax wouldn't be seeing that much of an average price increase per vehicle and their margin. There is sort of the difference between what they're paying. what they're able to sell cars for might show some shrinking pressure Now whether or not the stock moves up or down has everything to do with the expectations that analysts have set for CarMax which is really beyond the scope of this video.

But more importantly, I think we can look at Carmax as sort of a little CPI preview because used and new cars make up somewhere between five to six percent of CPI and Pce depending on which one you're looking at. Obviously, this week we're going to be looking at CPI that's sort of the most popular one and uh, in my opinion, we're going to want to pay really close attention to CarMax as a leading indicator in terms of what we're going to be seeing on on in that car or on that car side, So that could be a little bit of a trading heads up for us. So I'd definitely be paying attention to CarMax again, that is on the 11th, then on the 12th we'll get CPI followed by more consumer data. Unfortunate.

Fortunately, after the CPI release, for example, on April 13th, we'll be getting Delta Airlines We'll see our Airlines still able to raise prices. That's a big question. There's obviously a lot of demand for travel Hospitality Leisure but the question is, can Airlines continue to raise prices? We know there's still massive supply shortages in the Aerospace sector, so the cost of doing business is rising. We also know that lower wage workers are earning more money, so a lot of the input costs for airlines are going up, but if they can't raise prices anymore, because as United and Southwest have mentioned, they're ready to embark on a price War if they need to.

In other words, they are ready to lower prices to compete with their competitors if they need to, and their goal is to operate more efficiently. Well, we'll see, are they able to raise prices? are they able to operate much more efficiently? and how are those consumers doing with spending? So that'll be on the 13th we'll get our first look at Delta Airlines It's actually probably one of my favorites. uh I don't know. Probably United holds a candle that them, but we'll see.

Uh, Okay, then American Airlines is the most indebted, so something to keep in mind as well. Alaska By the way, least dead, at least indebted I believe out of all of the airlines anyway. Then on Friday on the 14th, we'll be getting JP Morgan City Wells Fargo and BlackRock all in the AM that is going to be a busy am. It's all between about 5 55 a.m and about 6 50 a.m eastern time.

So the banking sector will be huge because we're actually going to get a glimpse at how much our credit standards actually tightening. Everybody keeps talking about how the banking crisis is going to lead credit standards to Titan and maybe some credit standards have already been tightening over the last six months as we sort of walk into a recessionary environment. But NatWest was telling us last week that credit conditions aren't really tightening anymore than the path they were already on during the credit crunch now or or during the last six months. I Should say now there are some indicators.

We looked at these yesterday where we saw borrowing uh, sort of fall during the couple weeks of the credit crisis or the banking crisis and then a big spike right afterwards and now people are wondering. Okay, so is the credit crisis normalizing? Like do we have a quick little pause and then a rebound and is now West right that there really is no additional tightening or was that just people quickly withdrawing their credit lines down and potentially a uh, credit crisis and a credit crunch is still ahead of us? Well, that those banking catalysts will give us a massive amount of insight on Friday but again, that comes after CPI So the favorite data that we want to look for CPI obviously is going to be coming out on the 12th. Now the 12th is a very big day because we have branded a complete coupon code around it. So make sure you check out those links down below for all the programs and perspectives on building your wealth.

Whether it's investing in real estate, whether it's investing in stocks, building your income, As an entrepreneur, an employee, you want to learn about Llc's liability, You want to learn about how to best own real estate, the best deals to get how to build your wealth with real estate. It actually go zero to millionaire everything. Whether it's stocks, businesses making YouTube videos. being an agent, there's a program for you.

check them out linked down below well: I Am a licensed financial advisor. Those videos are non-personalized Financial Advice: They are a pathway that you could take very much inspiration from. uh which I'm very excited to share with everyone. So then CPI So CPI also comes out on the 12th, which is the day of the expiration of the coupon code and prices will be going up.

So CPI Expectations just changed. Now this is actually interesting: I was not expecting CPI numbers to change in terms of The Economist expectations going into the read. So on Wednesday April 12th we have the CPI expectation of instead of 0.3 which was the expectation. The last time we looked at the data, that number has actually moved and on the month over month headline it is moved down to 0.2 two percent month over month now.

I Was a little surprised by that that we we saw a shift down to 0.2 percent. That is going to be great on a headline basis. We'll be shifting down from point four month over month to 0.2 0.2 Annualized works out to about 2.4 percent which is fantastic. Uh, absolutely great.

Uh so I'm very happy that the that the survey is sitting at a median estimate of 0.2 Uh, there are 58 qualified estimates in Uh from Uh from from the Bloomberg analysis or rather 58 a qualified Economist putting together 38 estimates I should say so some of them bundle up. Uh, you've got Uh UBS, TD, Securities and Wells Fargo actually just UBS and TD coming in at point one percent, most of these coming in at point two percent. Oh, if I actually sort them, there are a few more at point One There we go. Okay, it looks like there are one, two, three, Four five estimating point one percent and then there are only four estimating 0.4 percent.

Most of them sit around 0.2 or 0.3 percent and the average estimate is 0.24 If you really want to get to the nitty gritty sometimes in the course member live streams, people ask me they're like oh okay, you can be the exact number. So I'm like yes, uh CPI that's month over month. CPI Core: Month over month is expected to be a little bit hotter. Core: That's going to remove the energy slump and energy price slump that we've seen.

And when you remove that out, you're actually looking at a survey of 0.4 which is 4.8 percent annualized. Keep in mind, after we saw a a oil production cut by OPEC Plus members, we have seen oil prices rise. But what's actually quite surprising is how little oil prices have really risen relative to what you would expect. Look at the chart on screen here which is branded with our beautiful overlay for the coupon code.

There we go, take a look at this. These are the This is the international blend of oil. It is Brent Crude: That's to be not to be confused with WTI which is the Western blend. And when you look at the six month chart here, obviously you could see that during the banking crisis is we had a big slump for oil demand.

But what you've seen is oil prices rise after the OPEC plus price production Cuts But folks, look at this. We can't even break resistance that we had before the banking crisis in mid Feb in late January in late uh December in early December We are not breaking out of that channel. so OPEC Plus is probably punching the air right now wondering why can't we break out? Well, Potentially part of the reason is or Futures markets are pricing in recessionary fears in the oil market. And obviously if we Trend towards a recession, the expectation is that we would have a few or should I say less oil demand.

that would be the expectation. So continuing with CPI here: CPI year over year has also just been reduced CPI year over year. In the prior read, it was six percent. Folks, buckle up uh and maybe get your life Insurance within as little as five minutes by going to bet Kevin.com life where you can Apple pay an Android pay for it CPI year over year has just been revised to 5.1 The Uh High estimate is 5.4 The low is 5.1 The median estimate is 5.1 So you have a really big skew to the left side here, which means you have a high bar chart on the left and then very very few estimates on the right side.

so people really convinced that this is going to come in at 5.1 Remember the prior read here for headline was six percent. We're going to see almost a one percentage point, or an entire one percent 100 basis point plummet inflation. almost 90 basis points. That's incredible And a lot of that.

Again, because of energy prices. Because when you look at the core, you're actually expecting to see core tick up slightly year over year. You're going to move from a prior expectation or a prior rate of 5.5 to about 5.6 So what is that going to? Signal What's going to mean? We're going to have to look at the granular data, how are those core Services doing? And those core services are going to be what we're really going to pay attention to. Now we want to talk about what the Federal Reserve and Nick T are up to as well, and how this could affect the stock market.

But before we do that I quickly, just want to look at and read off some of the core Services we're really going to be paying attention to and I think they'll be critical and remember those. the catalysts from CarMax from Delta and from the banks in terms of what and even what they say in the earnings call are really going to help shape an understanding around this CPI report. So I really think that's going to be uh, important in a basis for what the Federal Reserve is expected to talk about in May. Now remember, the May Fed meeting is going to be based off this CPI report.

That's really important because the next May meeting occurs on May second and third, too early to get another CPI report. So whether we get that 25 BP hike or not, it's going to be dependent on these catalysts likely this week. Keep in mind that right now, the Futures Market is pricing in a 65.5 chance of a 25 basis point hike. In May, we are also pricing in a 64.7 percent chance of a pause in June.

Now we're going to be looking specifically when it comes to CPI and obviously category number one: are we continuing to see Goods disinflation? Very important. Number two: have we started to see any rent deflation yet? That is rent of shelter lodging away from home hotels. rent of your primary residence via owner's equivalent rents Last Read was point seven percent. That's 8.4 percent annualized at the high we want to see that come down.

But the other thing that we'd like to see down are obviously airfares, transportation services. We'd also like to see other service is like haircuts, phone services Legal Services Postage Services Education Services Photography Services Pet Services We'd like to see all of these normalize now. Pet is one of the largest sectors that still seems to have lingering pricing power or that is the lingering ability to raise prices in the face of higher costs. Pets and pet supplies are really still passing on those prices, so that could come up in CPI as well.

Now we expect that to wane as household formations for pets are flat at least according to Petco's earnings call. household formations are flat at the start of the year for uh, for for more people basically having pets and that could be an indication that that pricing power May in for pet stores. But so far, if you're looking at companies like Chewie, it does look like these companies still have pricing power. The question now is how long will that stay in fast? Now the question is, what does this mean potentially for the stock market and the Federal Reserve Well, Nick T put together a pretty detailed uh Rapport on how much Panic there was at the Federal Reserve during the banking crisis.

Usually the Federal Reserve decides how much to raise interest rates weeks before the actual Fed meeting. However, in this last crisis, the Federal Reserve decided just two days before the March 22nd Fed Fomc meeting, whether or not to raise rates, which they did by 25 basis points. And the reason they waited so long is they waited for Swiss authorities to help solve the Credit Suisse disaster. Now if anybody's ever watched the Bourne series which is my favorite series ever I Just watched the first half of it with Jack my seven-year-old yesterday.

we got to the car chase in Paris But anyway, think about how exclusive Swiss banks are and how important Swiss banks are to the banking system. The reason I bring up born identity is because of course, Jason Bourne has to collect his resources from a Swiss bank in Zurich And so this this banking crisis was a huge blow to the the Swiss banking system, but the FED actually heavily leaned on what was going to happen with the UBS bailout basically buyout along with the government bailout, the Swiss National Bank basically guaranteeing the next nine billion dollars. And actually I think UBS was willing to take up to nine billion dollars of losses. and the Swiss National Bank was willing to take the next 15 billion in losses to orchestrate that deal because there's not enough time to underwrite the entire book of business for credit.

So he's anyway, long and short of it. The Fed was looking at that deal to decide whether to pause, and they were seriously considering pausing because of the banking crisis in March. Now that was a risk because even Bullard who generally suggests we need to get to a higher rate as soon as possible, suggested that if we paused, we would have potentially signaled fear and usually the formal statement for the Federal Reserve is actually drafted up to a week before that is. The decision could be made as much as two weeks before the statement is drafted a week before, but Powell didn't want to rewrite the statement so waited until literally the last minute to decide to go with a 25 basis point.

Hike The Economist Had a great piece yesterday talking about how the banking turmoil has potentially been ignored by the stock market. and I think the stock market cares actually more about what we're going to get in numbers this week. And I want to talk to you about good news is bad news versus bad news is bad news because the Economist talks about it as well. The Economist cites that investors have dumped stocks when bankings when banks have failed before.

They go into history and say, look, go back to Continental Illinois that was a bank that failed in 1984. The FED had to rescue it, and the Dow dropped six and a half percent because of Bank. In Illinois failed stocks slid 10 percent when Lehman Brothers crashed in 2008. it's obviously substantially more after that, and in September of 2029 between September of 2029 sorry 1929 and July 1932 during the Great Depression banking failures LED stocks to fall 89 So banking crisis is a massive deal when it comes to the stock market, especially now with deposits fleeing to money market funds.

But what's actually remarkable is our stock market's kind of like, eh, whatever. What did our stock market do? The S P 500 returned four percent during the banking crisis European stocks were up three percent during the banking crisis. the NASDAQ was up seven percent during the banking crisis led by companies like Microsoft and Apple. Retail trading flows have been elevated since 2021, and even though retail plowed money into the market about 17 billion dollars in the first two weeks of February, they actually plowed the lowest amount of money into the market during the two weeks of the banking crisis the lowest amount since late 2020.

Just nine billion dollars of retail inflows during the banking crisis. So retail was actually nervous about the banking crisis. You know, the stock market actually went up during the banking crisis, suggesting that some institutional investors actually saw the banking crisis as an opportunity to finally Buy in. Now that's interesting because after all, just 20 stocks have led 90 of the S P 500 surge year to date, Mada Apple Nvidia Tesla and the likes.

they have led the vast majority of the surge of the S P. And this is something that I've been talking about as well is that this is the kind of Market where you don't want to be exposed to all of the Staples that are going to get sandbagged in an earnings recession. You want to be exposed to PB Pricing Power stocks. That's what you want.

And I encourage you to look up pricing Power stocks I Teach price about Pricing Power stocks. Just go to Meet Kevin.com You can learn about not only my courses on building your wealth, my affiliate links, my uh, actively managed ETF All of the information is at Meet Kevin.com so just go there and learn more. But anyway, the question now is is are people being blind to a potential recession I Mean if historically stocks go down in a banking crisis, why in this banking crisis did they not go down Now That is a question that I'd like to answer right after. I Just shout out Crypto Life or who just donated 50 saying that today is their 40th birth birthday sending you some love That's awesome Crypto Life Or hey man, send us an email Kevin.com Good for email.

All right. So now what? And by the way, thank you to all those of you who emailed me yesterday about the Um. gold-backed uh uh, digital currency. Expect some email replies today.

Okay, so now we've got to ask ourselves: is bad news? good news, right? Initially, when we went into the cycle, we wanted to see weak data weak manufacturing data weak Services data Because it would suggest that inflation is no longer a problem. Well, this inflation report may tell us as a catalyst that inflation is no longer a problem. The real problem is actually recession. And how deep is the recession going to go? Are we going to go negative GDP By Q3 Q4 Or is this all going to be a funny joke and everybody's going to be comparing or waiting for a recession and the recession is never going to come? We don't know.

We have no idea, but the CPI report will be a big Catalyst I Believe to letting us know a is inflation going to prove to be transitory or not. If we end up having any kind of re-ex here are risk factors: A re-acceleration in demand inflation and a re-acceleration in uh, in services or housing inflation would be absolutely devastating. Now Look for example at expectations related to CPI going forward. Now this is a phenomenal.

Well actually these are these are not CPI directly inflation expectations. but I Want to show you this: This is from the Federal Reserve, the St Louis bank and the Federal Reserve that's phenomenal. I Suppose before I show you this. Let me just quickly finish the thought.

So generally bad news has been deemed good news. but if inflation proves to be transitory, is it possible that bad news is actually good news? Or is it possible that bad news is actually just straight up bad news. And the answer is yes, bad news could be straight up bad news. Why could bad news be bad news? Because inflation goes away and then we've proven to have over tightened.

Well then we got big problems because if we've proven to have over tightened now now we've got oopsie doopsies. Because now we go into a deep recession. potentially now again. I Have aligned the expiration of the coupon code with a CPI Wednesdays so the 12th so make sure you get in.

Remember you could use buy now, pay later and you get a price guarantee. Well going forward for Life the price is guaranteed, will never be lower or you get a price adjustment which is a phenomenal opportunity for you. No excuse not to join and you get all those custom course member live streams as well as all the lectures and perspectives on building your wealth. and the research that I do I mean everything.

You learn Everything. You can ask any question you want. So take a look at this. This is an H District businesses report.

Uh which? Basically they they survey eight different districts and they do a report about persistent inflationary pressures here and listen to this. They surveyed uh CFOs uh in in a CFO survey and then they looked at BLS statistics for Consumer prices and producer prices. They looked at forecasts and what actually happened and what I want you to see is where. Like who was basically most wrong.

So in your CFO survey in 2022 CFOs thought prices would rise 4.2 percent. They actually Rose 8.4 in the eyes of CFOs and companies that were interviewed. That's different because it's not a survey of all prices which you get you know via CPI or PPI baskets. So that's why there's a difference here.

But the point is CFOs were wrong about inflation by a factor of two. It's you know, look at this. they were expecting inflation prices to go up 4.2 percent. Prices actually went up an additional 4.6 percent at Eight Six.

That shows you that CFOs were caught flat-footed in the face of inflation. They were not expecting this much inflation from a consumer price point of view via the Bureau of Labor Statistics We were expecting 4.4 We actually got 6.4 in consumer prices PPI We were expecting Five Nine, We got Eight Seven. Now what I like to look at though, is the forecast for 2023 and you can see this softening In 2023, You actually see forecasts of just 4.8 percent. Uh, for the total survey CFOs are now catching up.

Cfo's actually think inflation might actually be more persistent, but consumer and producer prices actually suggest that inflation will be lower. So CFOs have historically been wrong. They've been very wrong by a factor of two over here now. CFOs are projecting higher inflation in 2023, but is it possible that they're wrong again in this time to the to, you know they're overestimating inflation entirely possible.

So I believe to sort of sum this Catalyst segment up. I Believe The big thing that we want to pay attention to here is a combination of everything that happens this week: I Don't think we can narrow this down to one Catalyst this week I Think this week you want to write down on a Post-It note or something. you want to write down a CPI the 12th with coupon code expiring prices going up. Then you want to look at Carmax on the 11th the day before.

sorry that's slightly out of order. Then you want to make sure you pay attention to Delta earnings and what happens with the banks at the end of the week because think about it. All of that together is going to give you a view of is the CPI CPI CPI CPI if CarMax is Raising prices a lot and uh and the airlines are raising prices and credit is fully available right now Duke can be keep in mind and I didn't talk about this one. this one's a little bit less, you know, popular but we are also the very next day on Thursday we're going to get PPI producer price really quick quickly.

I'll go into this one quickly, it's less popular. but the very next day 5 30 a.m we'll get PPI month over month expected to be zero. Uh, the month over month core is expected to be 0.3 as well as month over month Core X trade 0.3 But year over year is expected to plummet. We could see year-over-year headline PPI go from 4.6 percent to three and PPI core go from 4.4 to three and a half and then X trade as well 4.4 to 4.

So a big plummet there in PPI expected. So you've got a very busy week and I think after this week we'll be able to really nail down All right. Are we going to get 25 BPS or not? Remember the expectation right now is that we're looking at a 65 chance of 25 BP in uh in the Uh on the May, 2nd and third meeting of the Federal Reserve that's 65.5 percent to be exact at 65.7 percent of a pause in June with of course rate Cuts being priced in still towards the end of the year, the only way we're really going to get right Cuts towards the end of the year in my opinion is actually if we end up having a blowout low report on the CPI and PPI numbers which we may get and then everything will turn from fighting inflation to because inflation will then have proven to be transitory to fighting over session rates by the way are expected or this is a crazy chart. My gosh, this is a disaster.

So rates are expected to pause in June but if I look The First Cut is already being priced in for July with oh my Lord What? By January 31st, we're now pricing in almost two and a half percent in rate cuts. That is an insane curve. Holy crap. Um oh my.

Lord Okay, let me show you this because it's It's actually almost slightly hard to believe how uh, this just the shape of this curve. This is insane. Now that is a little risky as well because if the market is pricing in this kind of curve, it ends up being wrong. Uh well, that's going to be a little bit of an oopsy-doopsy eh.

And we're gonna have to do a little bit of price adjusting and remember that's how the market somewhat works, too. Is the market uh, can rise based on expectations of rate? Cuts Maybe that's why we saw those, uh, those those, uh in the stock market rise. Because now we're thinking, okay, the Fed's certainly going to cut. But Holy smokes, Look at this particular chart that I'm going to show on screen right here.

Look at those cuts. My goodness. Now the way to read this is basically you look at right. Here is your Peak right? Here is your pause.

Here is your first cut. So this is about five and a quarter percent. Five to five and a quarter percent. right? Here would be the range.

Uh, And then you get your first cut over here. Another cut. Another cut. Many Cuts Look at this huge cuts coming towards the end of the year, followed by some smaller Cuts Over here.

I Mean the cut over here looks like a one and a half percent basis point cut. I Mean let's let's draw that really quick. You're going from about negative one and a quarter here to about negative two and a half. That's a 125 basis point cut that is being priced in for uh December followed by uh, you know, and that's just that bar difference right there.

The cumulative would be somewhere around it two and a half to almost three percent cut. Uh, by uh, you know people like two points two and a half 2.75 two and a half to 2.75 price stamp by uh by the end of January Uh, that'd be uh, around my birthday time. Oh my gosh. Wow.

So if we don't get those cuts I think the market might be a little sad. In fact, that's exactly what TD or TS Lombard mentioned. They said If the Fed does not start cutting. we're going to have a big oopsie goopsy because the Market's going to go.

Oh damn it. In fact, it's over tightening and they're not even realizing it. Holy hell, Please get your life insurance in as little as five minutes. Going to Metcaven.com Live! Yes, you have the debt ceiling crisis looming as well, but that my friend, is for another segment.

Thank you very much for watching this segment. It was very detailed and hopefully very insightful. All right, very well. good job everyone.

that was fun all right now we need to talk about. oh boy that was it was quite detailed. Oh oh, all right, let's do a quick segment on Gaina. All right Standby: China hold on I think I still have some coffee over here you know I wish I visited I Wanna I Don't know if I want to post this video but I might let me know what you think in the comments.

but what I'm thinking is um so what was it uh, two days ago, two days ago I flew from from where we were taking a little spring break with Uh with the kids and and we're skiing which is really cool. We're big fans of Uh and super happy that real estate has uh has brought us to the position where we are where we can do that. uh and that's why I encourage real estate so much for everybody on the channel. but we uh I took Jack and we quickly flew from uh where we're at the resort over to Colorado and we looked at two different cities.

We flew between the two different cities and then flew back and uh, we're exploring Colorado and I'll tell you Colorado is beautiful I mean I've been to Colorado yeah, four or five times now just in the last three months and boy, Colorado just impresses me every time. Uh, with the exception of some parts of downtown. Uh, well, you get a little bit more problematic. Literally, right next to the Governor's mansion, you have a massive homeless problem which is unfortunate and and you know, I wish some of these City uh City officials would actually do something and the governors would do stuff about it.

but it's It's so sad. I Just read a story the other day that uh, a woman who was at a homeless facility uh bought an ax and killed uh, the homeless counselor with an ax and then the judge sentenced the individual who killed her to a mental health evaluation and I'm like, you don't think that would have been a good like phase one for homelessness like maybe working on Mental Health in our country. that was actually one of the big things I campaigned on when I uh ran for governor but it's sad. Uh, but anyway man, Colorado's awesome Here you go deep says it, ban axes what's in Upstate New York like Buffalo area sure is I mean maybe I'll have to come visit I'll be down to visit Upstate New York I've never been to Upstate New York unless Niagara Falls counts I don't think it does Uh, all right, let's talk China All right for China All right here we go.

So yesterday I explained how China founded their statements and the acts of Xi Jinping their Premiere now re-elected and other officials have been basically embracing capitalism in the face of losing their manufacturing clout as companies like Apple start fleeing to Vietnam and India covered zero policies, a real estate bubble and subsequent collapse and saber rattling really left China looking like a hostile place for business. and in recent months the Chinese Communist leadership has made it clear they've tasted capitalism and they want more. in fact apples. Tim Cook Just met with Xi Jinping and Elon Musk just announced a new mega pack facility in Shanghai which expanding in Shanghai and China is actually something that I've been encouraging since about April of 2022.

And the reason I've been encouraging it is because I I know that China has tasted capitalism and they want more of it. like let's go give me more, give me more I gotta have more capitalism so I thought Gosh, that would be a fantastic and easy place for you to build more factories Tesla especially since places like Berlin Germany is substantially more difficult to build or California Now this comes as uh, you know obviously China brags about how successful Tesla is in China with their original Tesla Shanghai facility. Really, Tesla is like an advertisement for how great doing business is in China Well, I thought Cooler Heads would Prevail this time around and much like last, August Nancy Pelosi visited Taiwan in August and then China conducted incredible military drills and uh, and potentially at one point launched missiles over Taiwan and completely encircled Taiwan with Uh with basically military exercises and I thought this time around maybe Cooler Heads would Prevail and and we wouldn't see those sorts of drills again. And so yesterday morning when we were we we spoke about my thoughts on China I said I think you know China is going to be a little bit more chill this time around.

Look, they're not conducting any exercises. Uh, in the face of uh, the President of Taiwan meeting Kevin McCarthy in California Well, I was wrong almost within hours of my video on China Uh, I was able to pitch a 69 off CPI coupon code for the programs I'm building your wealth link down below which you can now use buy now, pay later for Uh. But then also we got this chart here which shows that China is once again encircling Taiwan with military exercises being conducted across the median long line of the Taiwan Strait and you have Uh military fleets surrounding Taiwan Military exercises are scheduled for April 8th to April 10th. These exercises will be conducted Uh over these days and Taiwan has reported that there are 71 people's Liberation Army aircraft, nine warships, all of them crossing the median line and the Taiwan Straits and these units are conducted conducting simulated strikes on designated targets that they're establishing in Uh in the territorial Waters of Taiwan Uh, right outside of Taiwan Now that now they're a little closer or a little further away than those territorial water lines, Uh, uh, you can kind of see that but see that blue outline the territorial Waters The last time China conducted drills, they were much closer to Taiwan and much more.

Dare I say disrespectful uh in terms of where they were launching missiles Now none of this is of course respectful, but the last time was very severe. You got a lot of press attention. However, we have some facts here. according to Bloomberg, the drills this time seem to be different.

They seem to be quote substantially smaller in scale and don't include the imposition of any exclusive zones in airspace. or Waters Now remember China potentially flew missiles over Taiwan in August That is not what we are seeing now. And so while initially I said crap I'm wrong I said China's not conducting drills, this is great. They're enjoying capitalism and they're trying to be a little bit more reasonable.

instead of say we're rattling so round, loudly scaring people away. uh, they're They're going to be more relaxed this time around. Well then initially I thought crap I'm wrong. Here come the drills.

just hours after I posted my video. but now when I look a little bit deeper. maybe I'm actually not wrong and and maybe I'm biased. but I'm willing to be wrong.

But what I think is happening now is largely symbolic. see: I think China And this is my opinion. China has the belief that if you poke China we will punch the air to make sure you know we're awake. Think about that.

It's kind of like China gets poked by this Taiwanese President Visiting Kevin McCarthy The Speaker of the House the third person in line to the presidency China's like right punched in the air and and they're doing yeah, because they want to make the world to know no, don't mess with China Now that's actually very different from the embarrassment of America right now in the Middle East which is not the fault of our troops in the Middle East it's the fault of our Administration and I would say this no matter which Administration it is left or right. You all know that I'm I do my best to be in the middle. Uh, and the reality is right now in America. According to the Wall Street Journal out of 78 times our military has been attacked, we have only responded three times with force.

That is embarrassing. That is an embarrassing ratio. Uh, Violent criminals in the Middle East know that they have less than a five to six percent chance. Actually, less than five percent chance of being responded to by the US military even as they shoot rockets at our Americans and our contractors in the Middle East It's pathetic.

So I believe that China is actually holding drills as a as as potentially the people would expect of China not me. I didn't expect it. So I I will take the L on that. but I actually just revised sort of my thesis and thinking okay, well maybe this is just that's just the way China is.

The fact that these drills are not escalatory though. and the fact that they are actually a very watered-down version of the drills we saw in August shows that capitalistic sign of improvement that we were looking at yesterday. So I maintain that my thesis holds that in the next decade. it is more likely in my opinion that China will partner with Taiwan to grow their economies and their GDP substantially together.

Then it is likely that China actually invades Taiwan That is my belief. This means in my opinion, China is not actually flip-flopping here on their goals of of of of capitalism. they're just staying true to their nature. I actually call what happens in China I I I Came up with a phrase for this: I call what China is doing socialism with opportunistic capitalism.

It's kind of like everything is built on Central planning and socialism. but they throw the salt and pepper of capitalism on top and as a result, they have to maintain their impression in the worldwide uh, sort of in the world theater that hey, don't mess with China How dare you It you know, uh question our uh territorial Integrity uh, China owns Taiwan and Taiwan belongs to us, right? That appears to be what China is trying to say and they have to keep that impression going. But do we really think that they're increasing the odds of going to war? In my opinion, the answer to that is no. And the difference in the drills that we're seeing is highly, uh, exemplary.

Uh or exemplifies exactly this thesis. Now we'll see. obviously. I Expect uh.

over the next few, um, a few days we'll see how these Uh drills end up. I Think they'll end up very benign I Actually think they'll get relatively little press coverage I Actually think China doesn't necessarily want there to be a lot of press coverage around these. Of course they'll be covered. but look at this.

The drills were orchestrated conveniently around the same time as Tesla is announcing a new deal to build a factory with Tesla for Mega packs and I Think that actually reiterates my thesis because look at that. They timed the drill for when they could announce a big capitalistic announcement. Take a look at this when you go to the front page of Bloomberg Not only are you going to see on screen uh, my 69 off coupon code for the program so building your wealth you can now use buy now, pay later for But look at this: What do you have on the front page of Bloomberg The very first article Tesla To build New Shanghai Factory Tesla tripled Austin Workforce A lot of Tesla information here U.S Consumer prices Where do we have China here or China I See no China I See nothing about the China war yet I mean I would expect to see something on the front page. Let's do a find.

China Look at this. Look at this on the front page of: Bloomberg Uh Airbus to build New China jet Factory as Apple pulls back Tesla to build new Factory in China Apple at Heart of U.S Selective decoupling uh reality check How influential is China right now. look at this. There's nothing on the front page of Bloomberg about uh, the the military exercises.

Now in my opinion, that is actually exactly what China wants. You know for anyone paying attention. Uh, they are conducting military exercises. But for everybody else, what do they care about? Not this.

in fact. Look at this. Okay, watch this. This is incredible.

Uh, you can't see anything and there we go. Okay, so watch this. This is the South China Morning Post Look at this. This is a A Chinese propaganda.

Okay, what do they have here Macron trip hailed as success with the um uh, French President right? These are your front page stories. Why the U.S ideological struggle against China must not succeed? Okay, Chinese propaganda. So the most important stories to them are: uh, positive relations with with France uh and and still winning against their enemies though, right? Let's see. Here we go on here.

you have a sort of a byline. China's Pla simulates Taiwan strikes on day two of joint sharp sword drills. Fantastic. I'm actually surprised they're not pitching the Tesla deal as much here.

I Don't know. Maybe have they not woken up yet? See, they actually aren't on their propaganda site. they're not pitching in as much. That's very interesting.

It shows you a little bit of the difference between Chinese propaganda and American propaganda in China. They're like, look, we're meeting with world leaders and we're conducting exercises and the US won't succeed. But then you go to U.S Media and what are we getting today? Nothing about the Kevin McCarthy meeting or the Nancy Pelosi uh drama we had last time. Instead about how much people are actually building like Airbus and Tesla in uh in China It's very interesting.

I Mean let's look at the Airbus piece for a moment. Airbus To build a new China jet Factory As Apple pulls back, Airbus will double its production capacity in China of its top selling jet. In a bold bet on the on future demand and one of the world's largest Aviation markets, the European plane maker will add a second final assembly line for the A320 narrow bodies at an existing Factory in China And so they're adding a second assembly line. Got it? Okay, so they're expanding an existing Factory.

The move is a boost for Chinese manufacturing as other firms like Apple rethink production Now, they've been regularly talking about going to Vietnam or India but who knows Tim Cook just met in China Maybe maybe they'll expand in both places? Who knows. Airbus However, looked set to leave China without a new plane order during Macron's three-day State visit. despite intensive talks over the past weekend with Chinese customers. Bloomberg Recorded reported this week that the company was now targeting a follow-on order that would include A350s and possibly a330s now.

Airbus remained optimistic about winning business in China. All right, very interesting. so it's it's an interesting way to uh to to think about what's going on in China Nobody knows with certainty, right? And that's what I want to be clear about as well. Nobody knows with absolute certainty.

but I believe the fears of an invasion in Taiwan uh by China are relatively over. uh blown. I agree with Ronald here in the chat that China is very calculating I completely agree about that. Uh, Shurish here says China is scared from India India is the great hedge to China unless China flip-flops and becomes buddies with India That's true, but India knows China can't be trusted says I don't think the situation will escalate.

We lost my crown during the Trump presidency Hall Uh, guy Ladouche says Kevin war is inevitable. Yeah, I disagree with that. Well I mean I appreciate the thought, but I but I disagree with it. So anyway, that's my thesis.

It gives you a follow-up on what's going on with China and this potential fear-mongering around an invasion in Taiwan I I Don't think it's going to happen. but uh, we're going to continue to do to study it and I think every day that we continue to study it. Uh, we we could see whether we're getting closer or further away. I Think the de-escalation in military Uh exercises relative to Nancy Pelosi's visit are very clear indication that uh China is not interested in escalating military exercises beyond what they've done in the past.

If anything, they're de-escalating at the same time as de-escalating. What are they doing? Well, they're announcing new Factory plans with Tesla and Airbus. So anyway, my thoughts on China All right, We must talk about the next topic. Um, All right.

The next topic that we're going to touch on? Let's see, we've done that. Um, so. I Briefly Okay. I Briefly want to talk about this topic? This is going to be very, very short.

Uh, okay. I'm sorry. All right. So this is going to be a little bit of a touchy one, but we're going to keep it very brief.

Promise it'll be brief. It'll be like three minutes. Okay, so let's see here and some of these here, right? right? Okay, here we go and there we go. Okay, it's another 10 seconds or so here.

Okay, so this should go pretty quick, but it's a touchy one and so I Need your help in the comments? Help me as soon as possible in the comments, please. Whether you're Blue course member or green. Thank you. All right here we go.

Uh, let's put this here. Let's go folks. I Need help As a parent understanding what to do with a seven-year-old who is now asking me why one of his favorite cast members of the show? Mr Beast on YouTube has now transitioned uh, to uh, identifying as a female. So now one of the individuals Chris it has a transitioned uh.

they're announcing that they are transgender. Uh, this is a two-month difference between the two photos here. Apparently Chris is now on uh, hormone replacement therapy and uh, he writes here in response to this tweet. HRT it's only been two months.

Uh, this is obviously what I mean Mr Beast is one of the most popular channels actually the most popular Channel on YouTube But social media presence is massive. Uh, and the the question that I have is how do you respond to now a seven-year-old who's who's asking about this Uh, and so I'm going to give some of my responses and thoughts on this, but it is something that I'm very curious about what Society thinks and feels. So for example, here's here's another photo of Uh Chris with uh Mr Beast Here, he's just announced that, uh, he is on, uh, hormone replacement and uh, understandably to some extent. uh, social media's um, some social media is confused.

Some social media is very proud. My question: I don't really care what people do or how they identify I just am as a parent trying to figure out how to respond to my seven-year-old son who's now asking me I did not know that I could go to the settings menu and choose to be a girl. So I have a five and seven year old boy I want to be very clear I support people and whatever choices they make I have nothing against how people identify or their sexual preferences I don't really care how people live their lives as long as it's peaceful. I I'm I'm not going to tell people they can't or can do something that's not my place.

so I'm completely respectful of whatever somebody's decision is. It's nothing within me at all. Uh, that that uh is is offended. Uh, I'm just as a parent, uh, trying to struggle through what do you do So I've tried to logic out some of the choices.

so uh. One response that you could make to a seven-year-old is you could say yes, you can choose But then the question is, well, when can I choose And maybe the appropriate response is you could choose when you're 18 and you're an adult. But then now more and more children that are in like first and second grade are being exposed to people changing their genders earlier and I'm like this: They don't even know what sex is at seven years old they take like sex. Ed comes in fifth grade.

What the hell am I supposed to tell a seven-year-old who's now watching Mr Beast and seeing one of his favorite characters turn into a girl I don't know what to do I am totally lost as a parent so so on one hand I think okay, well maybe you could say yes, you can transition at 18, but even if you you take that approach now, how how do you say that like oh, it's an option that unlocks when you're 18. what do you tell a child? How do you explain to a child now your girl And then they respond and go. but wait a minute I Thought you're a boy. if you have a you know a Ding-A-Ling and you're a girl.

If if if you don't and now the question is uh, well no, it's just how you identify. Okay, well, why why then can't I identify sooner right? seven-year-olds are very curious. Well, if if it's if it's not a physical change that needs to be made then and I only need to say I'm like oh, I want to be a girl now I don't know what to tell a 70 year old. Now the other thing that you could say is no, you can't change genders.

Uh, you're biologically what you are, but you can dress up and act however you want You can. You can identify and tell everybody what you are, but biologically you are a boy that that is what it is. Uh, but now show that he's watching daily. Uh has an individual that could potentially have you know a name change obviously a gender change and there'll be some form of Behavioral changes.

And there may even be talk about using Therapeutics like hormone replacement therapy. Which all of this is extremely confusing to a seven-year-old Now, of course there's one train of thought that well then you could just censor. uh Mr Beast But I I You you can't censor children. They're gonna watch whatever they're going to watch anyway.

so you can't censor it. There are going to be people in before he's 18 who transition around him I just wouldn't expect that in first grade. I'd have to start trying to explain, uh, that that people can choose uh, uh, uh, you know, to transition. So so really? I have no problem with that I don't all I guess more of the issue that I see is now we're forcing this discussion to children who don't know anything about really, even their their own sexuality or body parts or what sex is or any of that.

So I have no idea how to explain that to a seven-year-old So the approach that I've taken is that you know, hey, that's that's something you know you can. You can decide uh, generally when when you're 18 and older and uh, and uh, you know that's uh, we kind of left it at that. Uh, but again, I don't know if I'm doing the right thing as a parent because I I'm not going to censor I have nothing I'm not opposed to the decision that the individual made that Chris made. Uh, the question now though is yeah, of course censorship never works.

We know that that's why. like I said, that's that's I would never censor Uh so. but I know that some people are right. That's why I bring it up on social media.

Some people are saying that's it I I Now have to block Mr Beast right? I don't I don't think that's the right answer at all. Uh, the question is how how do we share that with children and and that that's not also necessarily the fault of it's actually not at all. It's not the fault of Mr Beast or Chris because they make a decision I mean they are running a show that is essentially children show. So some people are making the argument that hey, well, if you have a children's show, this is not the place for discussing that there's an argument to be made on that side.

But then there's also the response of like, well, if somebody makes a transition and they happen to be a cast member of the show, are they just not supposed to be a member of the show anymore? Well, no because they should be able to freely identify however they want. But in terms of having that discussion with a child, it's very difficult. It's a struggle. I Personally think the the best response at least one that I will likely follow is is uh, one that will be Look, people can make a choice to identify however they'd like.

they are biology biologically what they are so you will bar you are born what you are. Some people prefer to uh, identify differently, address and behave differently. And in the future there are things that you can do whether those are surgeries or hormones or drugs. but those are all decisions that are made with a doctor.

In my opinion, when you're 18 and older and you're capable of of making that decision, uh, but uh. But but for a seven-year-old that's a I think that's a mind-blowing concept. So I think that is Uh is a discussion that has to just be had transparently with children. And we we treat our children like adults.

You know, we don't baby talk them. We we teach them everything that we can about uh being productive members of society, and uh, and and uh, we're not afraid to talk to them about uh, adult, uh things and and uh, things that happen in the world. Whether it's whether it's uh, People's Choice whether it's uh, how uh, Finance works or corporations work or business works, or how War works, or how crime Works uh or or race relations, we'll teach everything. Uh, this is just a new one that uh I suppose I wasn't expecting uh, really until at least the era of uh of um, more of a sexual Awakening if you will and and becoming aware uh, so it just feels a little early as all.

So anyway, that's a little bit of a of a struggle that uh that I have for uh, for a seven-year-old you know uh Max here writes uh Free Will and understand the consequences, Give people access or uh to educational material and have an informed decision. However, there should be an age limit, right? Uh, that? That's the question is is how do you establish uh, age? you know? And then of course there's also the uh, you know. Then we get into discussions about trans men participating or like biological men participating in women's sports I've already made a video on that. If you want my opinion on that, you could just type into YouTube meet Kevin trans men participating in women's sports and and you'll find that.

So anyway, um, yeah, all right, that's um, those are some of the questions I have moving on next topic. So let's talk Tesla now. so I want to go through the Tesla story on this Factory and then I want to play some numbers. All right here we go.

Oopsies, There we go. Well, Tesla has officially announced that there will be a new battery Factory built in Shanghai This increases a Tesla's exposure to China This is something that I found that Tesla should do for quite a while. I've been promoting this I even went on a Yahoo finance interview and promoted Build More In China I've tweeted at Elon Musk Build More In China and one of the reasons I've been a big promo proponent of Building More in China is because I believe that the Chinese Communist party wants more capitalism and they want to incentivize manufacturing just as Apple and other companies are trying to leave. China I Think China is trying to make up for their coveted lockdowns.

They're saber rattling and some of the extremeness of what we've seen in China. And now they're trying to make good and they're willing to basically shower companies with money if they just agree to increase production in China. And so I think that Tesla is building the new battery Factory in Shanghai is exactly what Tesla should be doing. It will be a lot easier to build than in a place like Germany Berlin's Gigafactory I think it will be.

It will create substantially higher margins for Tesla Tesla will now manufacture its mega pack large-scale energy unit in that new facility. That's great because we're going to talk about margins in just a moment. We're going to do some price uh, stock price uh, projections as well to see how this new announcement potentially affects the stock. So this mega pack uh announcement uh is going to be an add-on to the factory that a Tesla already has for electric vehicles in Shanghai.

Which is nice because that means the utility grids will already be in place. We expect production to begin in the third quarter of this year for Uh, the facility or I should say the development of the facility will begin in the third quarter of this year and production should begin in the second quarter. Uh. So around April of 2024, April to mayish Junish Tesla is Uh is is Uh.

Also, this announcement from Tesla comes right after Airbus announced plans to double its production capacity for its A320 narrow body Jet And this new manufacturing project uh really gives sort of a some clarity over hey, companies are still willing to manufacture in China even after the whole spy balloon disaster and everything Now the mega pack is awesome because it's really a massive battery that helps stabilize grits. Think about this in California when we have uh Peak loads during the summer times when everybody's running their air conditioning. We do not have really sophisticated peaker plants because a lot of the technology is still based in the 70s because California refuses enhancing the efficiency of peaker plants because they're like, if it's not 100 green then politically we refuse to let you make your Peak your plants more efficient. That makes our energy grid somewhat unstable in California and in other states of the country you see this as well.

A mega pack can actually provide enough stored power for 3 600 homes for an hour and they can instantaneously take over some excess loads. and and these are very good for grid stability because the last thing we want are grids that are vulnerable to collapse. There's actually a mega pack facility in Oxnard California which is very close to where I live. The new mega pack facility will initially produce around 10 000 megapacks per year.

Now that's pretty incredible because uh, you know Mega packages are kind of a little bit on the Privacy side. Uh, Mega packs right now have about a two year wait time which is crazy. uh and uh. these Mega packs.

They start at somewhere around 1.5 million dollars for a single mega pack. In some cases, now larger Mega packs have been increased in price to about two and a half million dollars. So I think the easiest thing to do is probably just go with about a two million dollar price per megapack. So think about that for a moment.

Two or ten thousand potential megapacks at two million dollars a unit is potentially 20 billion dollars of Revenue Now we're going to do some numbers on that to see what once that facility is fully ramped, What that could mean for the task? a stock price, But this is incredible I mean this is a massive announcement Here China Uh, keep in mind is is a massive market for Tesla especially since Tesla is growing in its EV uh sales whereas Byd actually shrunk last month in its sales uh of uh of electric vehicles. Now when you combine plug-in hybrids, Byd is still doing pretty well. But when you look at just electric vehicles and you break out the growth of electric vehicles, I'll show you the chart right here. Let's go ahead and throw this up on screen so you can see it.

There you go. take a look at this. This right here is obviously the sponsor for the video. 69 off You can now use Buy Now Pay Later for the programs of building your wealthy Lifetime access.

Best Price guaranteed. Learn everything I Know about fundamental analysis whether it's in real estate business LLCs Liability Insurances Real estate Building Wealth In any way possible, keep that in mind and get that best price by going to Meet Kevin.com At Meet Kevin.com you can also see my affiliate links and my actively managed ETF as well as other information. So what do we have here? We have Byd Electric Vehicle sales declining 19.6 in the fourth quarter of 2022 versus a 4.3 percent growth fourth quarter to first quarter for Tesla This this is uh, brought to you on Twitter here by Berlin Energy and the China Eevee post that is the source for this I Have not uh further verified this information, but it seems consistent with the sales of the companies. now.

what we have to also consider uh is of course how this numbers wise fits in in a spreadsheet. We're going to do that in just a moment. but keep this in mind: Tesla Shanghai produced almost 711 000 Vehicles last year. That is a massive amount of cars.

We expect that to roll up to about 1 million vehicles per year. So China is a very, very important market for Elon Musk Tesla receives about 22 percent of all of its sales from China so do not count out China And just the other day, actually yesterday we posted a video talking about how you can actually get very good exposure to China and the growth of China via stocks. Uh, like Starbucks Nvidia AMD Tesla to a lesser extent now Nvidia and AMD because of the chips bands. some of the advanced chip bands they're still selling chips to China Uh, okay, now, uh, let's go ahead and look at a spreadsheet and try to understand what 20 billion dollars could actually look like.

And first, in order to do that, we have to understand the margins that we're looking at. We're going to have to do a little bit of predicting here because we expect the margins to improve. But if