Hey everyone kevin here this morning we got our cpi print. The good news is the stock market only seemed to care in the pre-market. We, by the way, did have a private course member viewing of all the cpi data we spent about an hour and a half together and did pre-market open. So if you're interested in that link down below, but let's go ahead and give you a summary of everything that happened and how the market is really shrugging it off right now, but also what the next catalysts are to look forward to.

So first we were expecting a month-over-month increase of inflationary numbers of 0.4 percent, which would have been an annualized rate of 4.8 percent, but we got 0.6, which is 7.2 on the month of our month. So prices went up more than expected. In january we got a 7.5 percent monthly inflation or i'm sorry, year-over-year inflationary read when we were expecting inflation to come in at 7.2 percent on the year-over-year now specifically uh. There are some categories that are doing some interesting things that are kind of unexpected.

So when we actually go into the report here, uh one of the things that i noticed is that food at home on a 12-month basis was up 7.4. But food away from home is at 6.4, and a lot of folks are expecting that food away from home. To really start popping up a little bit, obviously we had energy costs up substantially with gasoline, for example up forty percent year over year, but down point six percent on the month now. This makes me curious because gas prices have really moved up in the last 30 days and not down, so it's possible that these numbers are going to come in a little bit heavier next month.

We also saw used vehicle prices, continue to come in a little bit higher here, but new cars were flat. Take a look at that. This is the first time we've had a zero percent read here. There you go on new prices in a while for uh for vehicles, and these used cars and trucks have the have had the lowest increase that we've seen here since september, which is really before the delta wave, which is kind of good uh.

So we'll take a look at some other highlights here: we've got uh. The only sectors that decreased, more notably like in terms of larger indices, were lodging away from home down 3.9 percent. There are questions about if this has to do with maybe omicron, but the flip side. There is airline sales and ticket revenue was up and we saw an increase in that.

So so we don't know if we can really blame omicron there. For some reason we just saw lodging away from home, declined 3.9 percent uh and and then declines in wireless phone services. We did see another note here on wages that uh urban wage earners and clerical workers had their incomes increased 8.2 over the last 12 months. That is actually in line with increasing purchasing power, not reducing uh or falling purchasing power.

Now we did also see 10-year treasury bonds hit 2 for a very brief moment, but there's a lot of resistance at that 2 level and right now we're sitting at about 1.97 which, if we can hold 1.97 1.98 on the 10-year. It's worth noting that if we can hold that it's a good sign if we break that and stay above 1.971.98 for too long on a technical basis, we might end up gap filling all the way up to 2.15. And if we had that kind of run within a day, it could make markets a little bit more fearful than they are right now, because right now we're seeing kind of a v-shaped recovery in a lot of the indices. The indices really shrugging off this report and we'll talk about which catalyst to here's sort of your spy for you.

This is when the report came out. You see us fall essentially to support right here and now we're climbing right back to where we were, which is about spy 457.5 ish, so we're working on climbing up to that as i'm filming this video now uh, what's really fascinating to know, is, in my opinion, What some of the anecdotes are that we're seeing out there, both good news and bad news i'll start with good news, we'll hit a little bit of bad news, actually there's more bad than good. But then we'll finish this by talking about catalysts and what this means going forward does today really matter or what matters, and why would the market be going up i'll, explain: okay, so first uh, some good news that we're seeing uh seeing uh some more amazon warehousing Space - these are some anecdotes from course, members from this morning, uh amazon, warehousing space and allocations for sellers increasing three times more space. Some folks saying yeah but fulfillment by amazon prices are going up and it's becoming a little bit more expensive, but you're, seeing more warehousing space.

Finally, come online, seeing backlogs start coming down at some chemical manufacturers and and some companies just really indicate that they're not seeing many issues with supply chains anymore, for example, and face did say in their earnings. Call that they're having a great time getting asics, which could be because crypto prices have come down uh but they're, not seeing as many issues as previously thought now. I do want to just give a quick shout out before i talk about some of these other aspects that that we got here some other information that we got in anecdotes that we have. I do want to just give a quick shout out to ftx.

If you want to trade cryptocurrencies - and you want the best opportunity for technical analysis available, make sure you go to medkevin.com, ftx us or use the link in the description down below to sign up for ftx they've got a really special event happening. Super bowl sunday, as well so you're, going to want to sign up for ftx and potentially enter to win free cryptocurrency on super bowl sunday. So sign up get your account ready now, maybe even fund it before the super bowl weekend and get your ta skills up and running. Okay, so some some fascinating anecdotes that came in uh, both from companies and from other individuals, pepsi and coca-cola, while they've been having a difficult time, keeping supply up uh coca-cola just reported that they don't believe they're going to be able to raise prices much more because They're going to start you losing consumers, because they're saying that personal incomes maybe aren't rising as fast as prices are and therefore they think there's a limit to how much they could raise prices, which would be good for the inflation narrative, obviously, sales at and earnings that Companies are killing it.

I i wouldn't be surprised if a firm, absolutely crushes it today, but anyway, pepsi versus coke. One of the things to know here is that, because coal law is somewhat commoditized, i do wonder if coca-cola can't raise their prices, because somebody could just really quickly go over to like the store brand or to pepsi or something like that. It's a thesis so uh, but that's good news. Hearing an executive from from coca-cola say: hey, there's a limit to how much we can raise prices here.

Some other notes. These are all anecdotes. What i'm about to give you and i'm going to get into some conclusions and catalysts so just quickly some anecdotes, some individuals. Two course members mentioned they just got teslas with no wireless chargers because of the trip shortage.

A few food distribution course. Member says that they've been they've doubled their prices year over year. We've seen that food inflation has been like up 50. It's crazy uh in some cases, double it's wild some engineers talking about how they're waiting for valves and actuators for three months rather than uh.

Three weeks that lead times are up, but but again we're gon na talk about how we can apply these sort of things to the actual stock market, because there's something special, the stock market does electricians, are having a hard time coming by pvc piping. A logistics worker says higher lead times for plumbing hvac electrical construction industries, seeing insulation, roofing and fasteners. Take six months out. Uh gun shop owners or gun shops saw a little bit of a slow down at the beginning of january is a little bit of what i'm getting and keep in mind.

Amazon did guide lower for january sales or q1 sales. They still had incredible earnings, so global food company is polling all of their q2 promotions, essentially keeping prices high, and this is something that we saw corroborated at in some of the earnings calls as well. Where companies are talking about hey, we just don't have to do sales anymore, like we can get rid of uh coupon codes because people are buying it. Full price, uh prices for rail travel, increasing uh.

There are a hundred thousand. This was an interesting one. Somebody works for a car maker says, and these are anecdotes, keep that in mind uh, so so they might not be 100 factual, but i just want to make that crystal clear. Somebody mentioned that they work for a global uh vehicle manufacturer and there are a hundred thousand vehicles sitting on lots with missing parts, and this is really interesting.

I think that's happening over at lucid as well, where it's like, hey great yeah. Maybe inventories increased kathy, but you know kathy would but but what? If these inventories are sitting incomplete to where they can't be sold to customers, yet right, fireplace manufacturer, seeing six-week back order of chips, broadcast engineer says: uh. Certain uh companies, like aja a manufacturer of production equipment uh, has just stopped taking payment or orders at all appliances. Seeing increases of anywhere between two to five percent on sort of the monthly basis.

Although remember from the new york fed survey, we saw people have less money to spend on durables uh, like refrigerators and so on and so forth. So some interesting kind of anecdotes from the world that it's kind of like where, where you don't see, pricing powers and maybe some of the commoditized products like cola, but everything else seems to have pricing power and longer lead times. But what does this tell us about? The stock market, why why would stock market not necessarily go straight down on a cpi print like this? Well, because the stock market is really forward-looking. The stock market believes that, at this point, we've just resigned to the fact that j-pal is probably going to raise rates on us by 0.5.

So a half percentage point increase now people on cnbc were yelling and screaming at each other. This morning it was actually really entertaining to watch them freak out and yell at each other, but beyond that the stock market is trying to look past. All of this, okay give us the two-year treasury the or the the two percent 10-year treasury. Okay, give us slightly higher mortgage rates; okay, fine pricing, a half percent increase, but is that really crimping earnings? And the answer to that is no.

So what is actually potentially something that the stock market cares about? It's not the cpi print which did come in a lot hotter than expected. It's j-pal everything's going to be about j-pal. So when do we get our next market catalyst for j-pal, because one thing that i always want you to remember is go back to 2008 for a moment. Let's just go ahead and do it together.

We'll go back jump on over to 2008 and this is where we have lots of dippity-dippity-dippitys and the dip just kept dippy-dippy-dipping. You know, like those memes you see on twitter, but anyway, see here, you get large dip, rebound dip, rebound dip flat, consolidation, tip rebound, yay rally right and you get this sort of excitement and then it's just oh crap right, not not any by any means trying To suggest that we're gon na have 2008 again, but the point is - and i want you to know this - what made this people like? Oh you can't time the market right, i get it. I don't think you can time the market in a very short term, but what made this happen right here, the federal reserve! That's it! The federal reserve u-turn right here - and this is what came afterwards right. So you want to pay attention to fed everything's about the fed.

So what are your next catalyst? Please write these dates down. The next catalyst are february 16th. You are going to get the federal reserve minutes from january. The december ones were trash and terrible worst minutes.

I've ever read - hopefully they chillax a little bit in the january minutes, we'll see, but the next big catalyst after that is actually another cpi report we're going to have another cpi report on march 10th before we actually hear from j-pal so like if you're worried about J-Power, you literally have a month to not worry about j-pal, so everybody's going to be speculating about j-pal for about a month, but you don't really have to worry about them for a month, with the exception of those minutes that come out in about six days, uh. So those are meeting notes right then. The next catalyst is, of course, the fomc meeting, the 15th and the 16th when j-pal comes out and speaks and lays the roadmap for what they actually expect to do. That is the key.

Now remember two things you got ta look at right now, the day chart is not looking that bad yeah. The indices are slightly uh a red we've slightly fallen below this 457 line on the spy. Here we bounced off the support line here at 450, which is actually a very bullish indicator. That's very very good, and you can see very similar patterns by making sure you're trading with ftx use that link down below, and you can also download the ftx app and check out the ftx app the fdx app on on the iphone, at least because i have Iphones beautiful, like really really amazing, so folks, this is bad news.

Uh, the cpi report was terrible, yields fell and we saw the yield curve inflect more to the downside, which is, unfortunately, a greater indicator of recession, more flattening of the yield curve. However, a market overall, at least right now seems to be mostly shrugging off this horrible report, and it's probably because the market is just seeing through this okay. So what we get a half basis point, you know half point increase: what's that actually going to do for inflation? Probably nothing! So what does that mean we're all paying attention to jay pal? What is he going to say and if he comes out over the next 30 days and says, look we see signs that supply chains are getting better and we think inflationary pressures are going to wane and companies are raising prices less then that could be the blessing. The market needs if j-power comes out with the opposite description, that hey supply chains are still bad and even as they're getting better prices are still going up for a lot of things very bad anyway.

We won't know for another month, but we'll get a hint in six days, thanks so much for watching we'll see in the next one.