Now it's time to buckle up for CPI And once again, what? Nick T just said yes Nick T The boy that we call Nikki leaks because somehow he just always knows what the FED is up to and so we listen to him like a hawk. I wonder if the fad has calls on the Wall Street Journal I Don't know, but they always seem to have the answers now. What do we have for CPI projections and then what did Nick T just say Well, number one CPI comes out this week. So I have actually quite a few catalysts this week this weekend.

I Want to read off some of the expectations for you? but uh, on the 13th we are going to get our CPI read. We are looking at a CPI read month over month of 0.6 That's pretty substantial. One of the reasons it's so substantially high is Energy prices have gone up. They've gone up quite a bit.

We're already at about 54 estimates right now. So the numbers that I'm giving you are consolidation of roughly 54 estimates and these are from different banks. This is like your Barclays your Bank of America Uh, it's also from a researchers like Bloomberg Morgan Stanley JP Morgan whatever. uh, visas.

Even in here with a CPI estimate and I always think that's really incredible because Visa like is watching consumer credit card spend and such and so you know they kind of see what's going on. It's like oh, those uh, those apples you know cost a little less last month, right? Uh, anyway, so all these estimates combined, we're looking at CPI core month over month, coming in at just point two percent. Uh, we actually believe that point two percent could be as low as 0.16 to potentially 0.18 a percent. Uh, and uh, we'll see what actually ends up coming out.

But anyway, 0.2 would be the rounded number for core CPI year over year, actually expected to accelerate from 3.2 to 3.6 percent. Again, heavily, the result of energy prices. natural gas making up somewhere around six well natural gas and gasoline come on, making up about 60 percent of the energy component is driven by gas and gas has gone up, so it's problematic. It's problematic to see gas prices up like this, and gas prices and oil prices going up.

Do also do something known as tightening Financial conditions which the whole purpose of raising interest rates is tightening Financial Conditions So Financial conditions are already Rising Because Energy prices are going up. You actually have this potential for the FED saying Look, we definitely need to pause in September That's basically clear, but that they might actually even be done because Energy prices have Financial conditions as tight as uh, we had this sort of little double Peak here recently at the beginning of August as Energy prices were Rising they went up to to roughly about a hundred golden Goldman Sachs Financial Conditions index. It's at roughly 100 Now 99.93 You kind of have this weird little reverse Head and Shoulders pattern recently, but if you go before that, we actually didn't We weren't at these levels since May or right before the banking crisis. So so these are.

these are higher levels of tightness. We were a lot less tight in terms of financial conditions. The end of May June July April Uh, so things are tighter now. Uh, and we expect the Federal Reserve to respond to that.

We'll look at some of this: uh, Nick T talk in a moment about that. CPI Core year over year, expected to come in at 3.6 That's about up from 3.2 in the prior. Uh, so uh, sorry. uh.

that's the uh, non-core number and then core year over year we're looking at again, that 4.3 down from 4.7 So core shrinking. Again, great. Uh, the day after that, on the 14th, we'll be getting retail sales. We're looking for retail sales to pop up just 0.1 percent.

way softer than the 0.7 we had in Prior month. And if you exclude autos on a month over month basis, we expect to be at 0.4 versus the one percent we had previously. again, way softer. Uh, then we're expecting PPI This is your producer price Inflation numbers On the 14th.

the 14th is Uh is PPI uh, uh, you know PBI data release day. It's also the day before the coupon expiration on the 15th. Link down below for the programs on building growth, massive expiration stocks, and psych. Most popular right now.

Zero to millionaire real estate most popular bundle. With this, we're finally bringing back back our Big Box partnership to course members as well. And in order to get into the early part of the House Hack fundraise, maybe the only part of the House Hack fundraise, you got to be a course member. So check out those links down below big Expiration This: Friday Uh, so Ppi is expected to come in at X Food and Energy Point Two versus point Three prior.

PPI Uh, month over month, non-core expected to be 0.4 versus 0.3 Prior, you've got uh X food, Energy Trade expected to be just point two percent. We really want to see those numbers come in to 0.2 percent, especially if the average is below that which it likely will be. The average is likely to be somewhere around 0.16 0.18 Which actually, if you then annualize that figure all you have to do. You don't have to go exponential.

here. you take like, let's take the average of that and go 0.17 For example, we multiply that by 12 and you're essentially at two percent inflation 2.04 It's the same thing as basically being at two percent inflation. That's what the Fed's looking at. Anyway, we know know that that mean inflation Trends Have been trending towards two percent already.

We mostly expect inflation Trends to be moving right towards two percent. The concern is Will These higher energy prices Unanchor some of these core prices core Services Obviously TBD A lot of uncertainty around turns in the business cycle. Uh, then uh, we'll get University of Michigan consumer sentiment estimates expecting that one-year inflation Target to still remain 3.5 uh, and five to ten year to be around three percent. And then, uh, you know, a couple weeks from now, we'll we'll be back at a Fed meeting actually less than that and it'll uh, it'll be on the 20th.

So we're about nine days away from the next Fed meeting. so those are big. Now what does Nick T Tell us? let's go ahead and jump on over here to Nick T's latest Nick T's tweet uh, which isn't loading right now there it is. Fed officials are turning more cautious.

All right, we'll let that load right there Here we go. Fat officials turning more cautious, uh, in the path towards their final rate hike. Uh, and uh, that's gonna be a big deal. We're gonna go through the article on this: generally more cautious about raising rates too high now that inflation is finally showing signs of Rapid declines that they long anticipated.

A rate pause in September will give the FED more time to see if recent progress has continued. Yes, let's go ahead and look at some of these details. Uh, by the way, yesterday was the 10th. It was my Dad's birthday.

Happy Birthday Dad, All right. So take a look at this for more than a year. Fed policy makers were unanimous that they would continue that they would rather raise rates too much than two later. uh, too little and too later.

Listen to this. this is changing. Ooh Some Officials still prefer to err on the side of raising rates too much reasoning that they could cut them later. Now, though other officials which could actually be more or the majority of officials other officials quote see risks as more balanced.

They worry that raising rates and causing a downturn that turns out to be unnecessary or triggering a new bout of financial turmoil or Black Swan basically would be unnecessary. In other words, they have to consider the human cost of their decisions. Why would you lead to people losing their jobs and business bankruptcy if you don't have to? If inflation is indeed transitory, why destroy the market? And that's been. the biggest bear argument for the past year is that the FED is going to overdo it.

That is a risk factor still is. But Nick T is telling us hey, wait a minute. We might have a chance here to um to just be done. The shift towards a more balanced bias on rates is driven by data showing easing inflation and unusually rapid increases or as a result of the unusually rapid increases of rates that we've seen over the last year.

The bigger debate is what would prompt them to raise rates again in November or December In June. Most officials projected that they would need to raise rates by another quarter point this year. Projections to be released at the end of: September This is September 20th. We're going to be getting the Sap again.

It's a big deal. It's going to be a big Fed meeting Sap the summary of economic projections, right? Big deal. But anyway, whether they deliver such an increases Open to question for the past year, officials have placed the burden of evidence of slowing economy to justify pausing rate increases. As inflation cools, the burden has shifted towards evidence of an accelerating economy to justify High rates.

But it's not just an accelerating economy If People really forget this and I really want to remind you of this. Yes, there's a coupon code this Friday You can email us at Staffing.com if you need a bundle. But what I really want to remind you of is remember folks, it is not an accelerating economy. That's the problem.

An accelerating economy is okay. It's an accelerating economy where inflation is de-anchoring As long as inflation doesn't de-anchor continue to to go up or go up again. rather. I Should say as long as that doesn't happen, you can have a strong economy because what does a strong economy do provides more employment for whom? specifically does it provide more employment? Well, historically it provides more employment towards lower income individuals.

This has been a little bit skewed because of Covid, and there have been a lot more blue-collar jobs and service jobs than there have been White Collar jobs. So you've had this sort of weird dynamic now, but usually the Federal Reserve is highly sensitive to offending. uh, the the the growth of basically poor individuals being able to participate in a good economy. It wasn't until about 2018 that drone PALS like we finally see a more broad-based income demographic benefiting from a strong economy and then covet hit and ruined everything.

So this is something they're definitely paying attention to and that human cost matters matters a lot. Let's keep going. For the past year, officials have placed the burden of evidence slowing. Uh.

Inflation? Okay, but inflation has started cooling. Recently described that firmer than expected economic activity could could basically slow, uh, progress on inflation. but he's using the word could instead of wood and this is basically a flip-flop to argue that like, hey, maybe maybe what I just described a strong economy does not necessarily mean all your inflation. One Camp of officials is still anxious about the increase in inflation and wants an insurance policy by raising rates this fall.

which is also kind of interesting because that's one place you're still seeing inflation go up is insurance that doesn't have to do have anything to do with what really Nick T is saying here right now, but insurance prices have been going up a lot. So much so that some homeowners are just not having insurance at all anymore. They're self-insuring, which is very risky, especially in places like Florida just looking at real estate. Florida I grew up in South Florida Anyway, over tightening is a risk, but we've been underestimating inflation.

Allowing inflation to be up for longer does carry a cost for the economy. If it turns out such an increase had more of a negative impact than expected I'd be more willing to cut the rate a little bit faster. I Don't think one more rate hike would necessarily throw the economy into a recession if we did feel that we needed to do one right. So skipping doesn't necessarily imply stopping a higher for longer, blah blah blah blah.

Okay, I Want to be very clear: While they argue they're at the fine tuning stage, There's a psychology to being at the fine-tuning stage. You could literally think at the Fed or done that. We've done enough and you would guess what You would still tell Nick T in the world. Hey, we might do one more.

They're keeping that door open, of course, because as soon as they say we're done, you're gonna see a big fat rally in the stock market. A big fat collapse and treasury yields and that'll instantly loosen credit conditions and financial conditions. What's actually wild right now is that while oil is falling in the pre-market and stocks are actually Green in the pre-market look at that 10 year 10 years up. another 3.4 Bips.

People really think worse. the Fed's not done yet. So Fed is done. That yield comes right down, so it's pretty exciting.

It's exciting times. It's uh, the turn of a turn of the Eco cycle here. and uh, Nick T is, uh, somewhat suggesting that uh, this, uh, this could be it, what could be done, but the FED might be back to considering the human cost of raid hikes. and Nick T after all, is the as we call the FED Whisperer.

As far as inflation, inflation numbers are expected to be benign here. Uh, in two days. it'll be big though, because if the estimates are wrong and it comes in hot, we'll start penciling in that rate hike for Uh for November December, We'll probably still get the pause in September, but November December We'll definitely price that in right now. By the way, it's uh, it's worth looking at some of the uh, recent numbers that we have for uh, terminal rate, and we'll also look at the five-year break even and five year forward.

So right now, the FED term rates expected to be about 5.44 it's been pretty stable. Uh, again, 5.37 implies the Fed's done so. Any number above that, getting closer to 5.625 is Uh is a limit. Five year break evens up at 2.3 percent, a little elevated and a little elevated on the forward break even as well at Uh 2.35 2.3 and 2.35 for these two numbers for five year breaks.

So uh I think CPI will really affect that in two days. So buckle up for CPI And of course, the expiration of the coupon code. this Friday it'll be a big one be the last chance to get into not only those big box retail or uh, discounts with the company as similar to Home Depot uh, which name we didn't mention until you're in the course it's coming out later this week and then of course, being able to invest in House Hack potentially being the last opportunity to invest in House Hack as a course member uh, of course members exclusively only to start with. and if we fully fundraise with course members, then that's it.

Last time we we raised I Want to say it was somewhere around 80 80 plus percent of all of the fundraising that we did from accredited investors course members. What does that tell you about the level of wealth of course members? It's actually pretty impressive. You know people are looking for real perspective, not some of the basic perspective that's out there on the internet, so thank you for entrusting me in that uh, similar thing we're actually seeing with Stack Hack. uh, higher higher net worth of people coming to us with real problems to help us solve uh for financial advice at Sakai all these things are linked over at me Kevin.com You can see them all there.

This little thing at the top, you can click on it, shadowing Statcack and all the other stuff. So anyway, we've obviously covered uh, the complete consensus of forecasts and we'll discuss those in more detail. But most importantly, we want to highlight: Nick T Our Fed Whisperer Mr Nikki Leaks Wall Street Forecasters expect August CPI to show headline Rose 0.6 in July boosting the 12-month rate to 3.6 from 3-2 thanks to Energy prices. Remember gas generating around 60 of that headline movement they see core CPI 0.2 percent lowering the 12-month rate to 4.3 from 4.7 in July And these are some of the breakdowns over here of uh, that core level.

look at those core estimates I mean the highest one over here is 2.5 or well, 0.25 but a lot over here: 0.15 0.18 This is where I lean over here in this lower area 0.14 I Know what? advertise these things that you told us here I Feel like nobody else knows about this? We'll try a little advertising and see how it goes. Congratulations man, you have done so much. People love you people. Look up to you Kevin path right there financial analyst and YouTuber meet Kevin Always great to get your take.