So this has not been a good day for the stock market. It could have gotten a little bit better. Well, the nasdaq fell three and a half percent today and the s p, you know, got hit pretty hard as well. Now the question is what the hell is going on, why this happened and what's coming next now in this video i'll, explain to you exactly what just transpired and how we're going to move forward from this.

But they said that the current conditions could warrant a faster pace of policy rate normalization. In november i told you, the fed is playing you and when they start admitting that they're playing you you're, going to see a massive pullback in the market, because nobody out of these yahoos with their suits are pricing in the fact that these interest rates that they Told us in november makes no sense uh, you know i've been saying for over a year the fed had to be far more aggressive than the market had expected with the inflation, i think, never temporary and going to get worse, uh, and i think the minutes in December reflect a lot of concern of those fed officials and i think the market is beginning to say yeah. They are going to get serious and i told you once that happens. It's gon na be a massive pullback in the market and then all the opportunities are gon na be right there in front of you, so you don't have to rush into growth stocks before that happens, that was my theory and lo and behold, it started to happen Today so the reason the market crashed today, everything is down everybody's in the red.

It looks like a communist party convention. The reason this happened is because the fed minutes came out. Basically, letting us know that finally they're admitting that they have to raise interest rates higher than what they initially said in november, basically expediting the interest rate hikes beyond the original and not sustainable level. Now i'm not going to sit here and pet myself on the back, but i did tell you exactly what's going to happen in november.

I call this play-by-play before that happened. Nostradamus strikes again. Basically, i told you that what happened with transitory inflation and the fed, basically admitting that inflation is not really transitory, is going to happen with this little fluffy interest rate. They showed you in november i told you they're going to come out q1 and they're gon na tell you hey you remember when we you know when we said that this is like the interest is gon na.

Be enough like a point three percent, then a one percent and then we'll just end up with like a three percent interest: three and a half percent interest and we'll be done, but that's only coming in three or four or five years right. Remember when we we told you that just a few months ago, well yeah, we were wrong and, as always, you know politicians have no accountability. Much like jim cramer, they can say whatever they want, say the opposite thing a few months later, and nobody cares now for jim cramer. I do actually have a surprise, because we have this clip of him recommending didi as a chinese talk check this out.

So if you want to speculate on a chinese ipo, you've got my blessing to bet on deity. I would try to get as many shares as you can d-i-d-i. 2. 000 years later, i can't recommend buying stocks in a communist regime.

That is a totalitarian dictator who's. Not just human rights, but is doing much more than that to be able to solidify his power uh. I think that the pres president xi does not like capitalism. Ladies and gentlemen, news are in from china.

The chinese communist party are not fans of capitalism. Very interesting. Thank you, jim. What the hell i mean, it's like saying that stalin didn't do a great job with you know: human rights, that's an understatement, a little bit there jim, but moving on to the topic at hand.

So basically, the fed just basically released today information starting to massage the public into the awareness that the interest rates they're about to see are much higher than what they told you in november and immediately as i predicted, the market pulled back significantly. I think palantir was down, seven percent nasdaq was down as an index, almost three percent in the single day. You know what it means for an index to move three percent down in a single day. Everything was read, everything was down now.

The question is now that we know what caused it. Did you play this correctly? Did you wait with a lot of money on the sideline, and now you can pick up a lot of shares at a much reasonable price or you shut your load too fast and you missed out. I don't know, however, what i'm about to tell you right now is i don't think that this is the end. I think this is just the beginning.

This is just a taste of what's coming when you're gon na hear and see. Jerome powell on tv basically come out and say: hey in his own voice on tv on national tv, saying: hey we screwed up. These are the updated interest rates, because what they're talking about, because what with it, because what they're saying right now is just a conceptual thing, they're just saying well, interest rates should be higher than what we initially anticipated. It's a completely intangible.

Nobody knows what it is. They don't specify that in a minute, so people tend to be optimistic, especially people on wall street and mainstream media. So for them they might assume that it's about to go from three and a half percent to four percent problem is that with seven percent inflation back in november and then monthly inflation rate of about point, eight percent we're probably staring down the barrel of double digit Inflation quite soon and just to let you know - and you can google this there's a very simple rule that tells you how much interest exactly you need to battle inflation, which is 1.5 x. So if you have 10 inflation, you need 15 increase, which is very close to when paul volcker in the 80s actually did something similar with reagan, and they actually pulled the us out of about 12 13 14 years of inflation, which started in the 70s then became Stagflation then jimmy carter lost a job just kidding and basically reagan came in with volcker, they did a 20 interest and they basically pulled the us out of the hole um.

I don't know if this government and this fed and this chair have the ability or the balls or whatever it takes to do something like that. I know that it's what's necessary, but i don't know if they'll do it, however, even if they do half of that, and that is going to be the real opportunity when the fed actually says real rates and when powell actually says that, then you can get a Much better price now is it worth buying right now through this little dip? I don't know it's your decision, i'm not a financial advisor. This is not advice, just the guy in the internet with their opinion. So i don't know what i will tell you that i'm buying the dip a little bit, i'm just putting my feet in the water a little bit, but i'm not still jumping in with my whole body, i'm buying a little bit.

I'm just tasting the water. I'm still waiting for the big tip to actually jump in when the rates go crazy down when they say hey. Well, it's not three, it's actually eight percent or whatever it is. They say i don't know now.

A lot of you will comment in my comment section. Well, tom, the us is not able to sustain an eight percent interest rate and i totally understand that because it actually makes a lot of sense, because the us has a lot of debt. In fact, it's pretty much like a college. Kid who got 25 credit cards and maxed them all out and doesn't have any way to repay it.

It's pretty much as bad as it sounds, and if you raise interest rates to you, know 10 or 12 or whatever it is it's about 10, 12 or whatever. It is percent more than what they're paying right now, which means that servicing this debt for the us becomes unbearable impossible. Now some people will tell you well that's going to bankrupt the u.s economy or this government. That's not what's going to happen.

Basically, what's going to happen is that the u.s will have to print more money to service this extra debt, but when they print more money, they're, basically bringing us back to point one square, one whatever you want to call it of inflation, because you're raising interest to Reduce inflation but then you're printing, more money to repay your own debt, putting more money into the system. Basically, you know completely stuck in this infinite loop, so what needs to happen is first of all supply chain issues have to be fixed as soon as possible, because you can't solve inflation without solving supply chain issues number two: they have to stop qe quantitative easing immediately. Stop buying assets, stop buying mortgage-backed securities and t-bonds right now they have to raise interest rates and they have to kick-start the economy to increase gdp, so they can actually get tax dollars. So these tax dollars can be used to repay the extra debt service they have to pay with this increased interest rates just be kind of brief about it.

That's pretty much what they did in 1981. Go. Look it up paul, volcker in 1981. He did something similar.

They worked together with the government, the government actually deregulated everything, lower tax rates, volcker, raised up interest rates and then they ended up collecting way more tax, even though they lower tax, it's kind of counter-intuitive. But if you do a drill like that and you lower taxes, you actually increase your collections. That's called the laffer curve. You can check it out as well um.

The road map for me is quite clear, so i know i'm waiting for the next step, which is going to be the bigger dip when they admit they haven't done enough with interest, and they need to increase interest rate hikes on the microeconomic side. Is the u.s completely doomed? I don't think so, because the road map is right there to solve this. My only concern is: i'm not sure that this government has the mandate to do it, because for them to put the market into recession to solve an inflationary problem is pretty much going to be the end of their careers. So the question is: are they willing to sacrifice their careers politically to do the right thing i think eventually they'll have to but we'll see what happens, share your thoughts below you know.

Tell me what you think and i'll see you tomorrow.