Welcome aboard to another day of stock market hell where? Today we get to review the Jobs Report because there's nothing better than to look at the Jobs Report when you're trying to understand what's happening in the world of wage inflation. And that is what we're going to learn about today. Or will we. After all, the Bureau of Labor Statistics doesn't have the best reputation for accuracy and a politicalness that is.

Some allege that maybe the Bureau of Labor Statistics has a pretty large incentive to be relatively political, So that way politicians can say, hey, don't worry, we still have job gains even though we're walking into a recession Now One of the reasons people say this is because researchers at the Philadelphia Federal Reserve have finally come to realize that maybe job gains just aren't as large as they have seen or have seemed. That's because there's a difference between what we're about to see in the Establishment Survey of the Labor Report and the Household Survey of the Labor Report. The Establishment Survey basically calls up companies and says, yo, how many people you got working for you. All right, more people than you had before.

All right. We'll add that in the Household Survey counts people, hey, yo, you got a job. Yeah, I got two jobs. Okay, sounds like you're employed.

that's one. So if you have multiple jobs, you could actually show up multiple times on the Establishment survey, but only once on the Household Survey. Research and estimates from Wall Street suggest that we're probably only looking at gains of about 12 000 jobs over the past nine months in 2022, whereas The Establishment survey has suggested that maybe we've had great gained by an amount exceeding 2.4 million jobs. That is a huge difference between the two.

and the Philadelphia Fed has said, at least for the second quarter of 2022, because they're like six months behind in their data. Yeah, the data is much more in favor of the household survey, not the establishment survey, so we'll see what happens. But in two minutes, we are going to see the release of the labor Report for December. Now keep in mind, we had the ADP Jobs report which came in a little bit hotter than expected, so there is a chance that this December data from the actual BLS report could come in a little hot.

The private report is deemed to be a nice little fact check the private report actually saw an ad of 235 000 jobs and uh, in in their opinion, uh, they saw a lot of those jobs coming from Leisure and Hospitality and Educational and Health Services which you want to keep in mind those are industries that actually have fewer jobs today than they did in 2019, so you'd still expect to see some gains there as we kind of re-jigger the economy. But we got surprises that Professional Business Services had 52 000 gains and construction had 41 000 job gains. Those were surprises, especially in this sort of recessionary environment. And then of course, we're really paying attention to those gains in Pay.

Although real wage gains have basically been zero, so it's like, yeah, wages are going up, but people aren't actually making more money. If anything, they're making less money compared to 2019 thanks to all the inflation we've had. So what are the numbers we're expecting right now? Well, the prior release of the change in non-form non-farm payrolls was 263 000. In about 30 seconds, we're going to see what the number is.

The survey is expected to be two hundred and three thousand. We are expecting the unemployment rate to sit at 3.7 percent and the average hourly earnings to be point Four point four. that is a month over month. Read: if that number comes in hot, big problems, that's probably the most important number for nobody's really believing the headline number anymore, anyway, so focus on in my opinion, that bottom line: Month over month, wage gains number Dot 223 A little bit hot.

Oh, average hourly earnings point Three: That's good. Good point three on the month over month. Thank goodness. Average hourly earnings year or year 4.6 versus the 5.

Expected good, Thank the Lord that's actually really, really good On uh, again, the payrolls number the Top Line number a little hot. but those wage gains numbers I'll take a point three percent all day long. Again, that point three percent uh represents uh, just 3.6 annualized inflation. That's better than the expectation of four point eight percent uh, or point four percent on the month over month.

uh. However, the unemployment rate did fall from 3.7 to 3.5 percent because we had more gains than expected. uh, on the top line number. But then again, let's go ahead and look at the household survey which Wall Street seems to see as a little bit more accurate right now.

uh than the Uh than the actual establish publishment survey. And so, let's go ahead and look for the household number. Let's see. let's see.

let's see how I'm just going to search for it. House Household Household service? Find it. Find it. Find it.

Seasonal adjustments, Household survey data 3.5 percent. And let's see: Establishment survey data gained by 223 000. Notable job gains in Leisure Hospitality Healthcare Construction Okay, that's understandable. Uh, where is my household number? Upcoming changes? Mm-hmm All right, I'm going to put this into a PDF reader.

Hold on. Okay, here we go. Uh. Household Household December December December December December Oh yeah, Household data changed like zero.

No hold on. Hold on. Wait wait wait wait wait wait wait wait. Employed household.

Oh okay, yeah, there we go. So this is the household data here on the right and between, uh, no, you've got some changes. Hold on a sec, Let me put this in a PDF reader. It's going to be a little bit easier for me to look at I Wish they would just highlight it a little bit easier for us.

but the household number? They don't That's all right. One sec while I pull up the PDF But I'll tell you, everybody's gonna care about that wage number. That wage number is most important. Like I said.

Okay, let's let's just go through this together here and we'll get the numbers we need. So again, 223. This was hotter than expected, right? The expectation was 203. Let me see if we have any prior revisions.

We actually do have a prior revision. Okay, so prior, which is actually the November report. We are sitting at Two Five six. That is down from 263..

So we actually have a downward revision on the establishment survey for last month. That's obviously in my opinion, still way higher than it actually is. 3.5 percent here for the unemployment rate. We saw that move down because I'm actually really surprised though, that construction is gaining the way it is household survey and the establishment survey.

Those are the ones that we want the numbers from. That's fine. Uh, let's see here. Household survey data: Okay, among major worker groups, unemployment by whites fell to three percent.

jobless rate for adult Men: 3.1 Women: 3.2 uh, Blacks: 5.7 Look at that Black still sitting at about twice the unemployment rate of Whites? look at: Asians Oh my gosh, 2.4 unemployment rate Good Lord That's low. Uh, let's see number of long-term unemployed declined by 146. That's good actually. Uh, Employment population increased slightly.

Fine number of persons employed part-time for economic reasons Changed: Little number of persons not in the labor force who want a job fell by 352 000. Oh, that's good. Good. So we're actually filling.

Uh, you know, like the job Seekers are finally finding jobs that's actually pretty good. Uh, this number is a little different from Feb of 2020. Good. Okay, great.

So we're finally lining up a little bit more. Let's see here. Uh, again, there's our 223. notable: Java Games Leisure Hospitality December employment and Leisure Hospitality Rose by 67 000 comparing to the ADP report which was somewhere around 120 000..

Uh, actually, we have it right here. This was on the ADP report. the estimate for leisure Hospitality was 123 000. we've got Amusement gambling Recreation up 25 000 Leisure Hospitality 79 000.

Uh, so that means was. Oh, that's an average. Okay, so the average gain for leisure Hospitality has been 79k. So you're actually seeing a little bit of a below average read right here.

Interesting. Okay, Healthcare employment of 55k Uh, let's see average in 22 was 49 000. that's possibly because you're seeing such boosts and like flu and RSV sicknesses right now. Social Assistance 20K Jobs: Employment and construction: 28k specialty contractors seventeen thousand Uh, okay.

Mining increased 4K Retail trade Little change 9k manufacturing 8K I'm actually surprised we saw a boost in manufacturing and transportation warehousing. Slight boosts here. Government employment essentially unchanged Business Services minus six thousand for business services average hourly earnings. This is where we saw a change of 0.3 percent.

This is really, really good. We want to hear that that 4.6 over 12 months we saw that that was below estimates. Remember, the estimates here were uh, 0.4 and a five percent. So 0.4 is that month over month.

Five percent was that year over year number. So the fact that we came in low on each of those? Really, really critical. Uh, let's see here. Okay, try to get a little bit more dad.

I Want to see what Wall Street is saying here on our U.S Employment report for December Payroll gain is the weakest reading since December of 2020. Further confirmation that the labor market is, uh, slowing. Okay, the Four Point: Six percent you're you're quite a bit lower than expected. Good.

Ah, the November read was taken down as well. That's great. So the November read right here for average hourly earnings November average hourly earnings. Uh, actually were revised down to 4.8 percent year over year versus 5.1 percent.

That's really good. Uh, obviously still far away from two percent, right? But that's actually good. Futures Turning green on this. Uh-huh Again, slightly stronger on the headline the 223 versus the 203.

That's okay. Okay, all right, let's see what else we have. so I like I Always like marking what I write in red just to contrast. So let's do that really quick.

There we go. Okay so I like seeing that average work week for all employees on private non-farm payroll declined by 0.1 hour to 34.3 Dude man. I wish my average hourly work week was 34.3 hours I feel like I worked 34.3 hours in a day in manufacturing. The average hourly work week was little change to 40 hours 40.1 Okay, change in non-form payroll was revised down for October by 21 000.

November was revised down slightly. okay. what else let's see here I can get a little bit more data so employed. Let's see here I'm trying to understand their where where they like to get the household number from.

So far nobody's talking about it which I find very interesting so I will get to the bottom of it. Let me go to one of the other charts I have they would give us a bunch of extra data. uh. In the meantime, we can also take a brief look and see what some of our indices are doing.

uh uh okay NASDAQ up 0.3 Tesla down just a measly eight percent. that's like uh, that's just a walk in the park for Tesla At this point, you know just another typical day may as well try to rival Bed Bath and Beyond down about 12 here in the uh, pre-market Uh, you can see this nice Spike over here on the S P that's uh, it's really driven by this uh, move down here In wage gains still gaining okay household data. Let's see here. So the change.

Their household data uh, shows 136 000 in terms of change. See, that's actually right here. So 136 changed from November to December. Here's the unemployment rate down point one: The expectation was 3.7 So that's moving obviously in the opposite direction.

And that's another one of those issues for the Federal Reserve Because the Federal Reserve is looking at oops, the Fed's looking at. hey, how can we get the unemployment rate up to about four and a half percent? It would take them probably about a year at Job losses to actually get that high, which a little scary. Here's the summary of economic projections for the FED unemployment rate here: 4.6 is actually what they're projecting. So in order to get to 4.6 you would have to start having these reports come in at about negative 90 000 at least based on Wall Street estimates for probably about 12 months.

So it's going to take quite a while for you to actually see that labor market move, uh, into that sort of unemployment rate. And the hope is that inflation softens by then. and the FED doesn't actually have to lead to that kind of joblessness. Uh, you know you don't.

You don't want that kind of joblessness. Uh, you just end up deepening the recession, right? I Mean, think about it. More people. Unemployed means less people buying stuff from the companies that you might be investing in.

unless of course, you're shorting everything. So okay. Looking back at what Wall Street is suggesting. Uh, let's see here.

Okay, so this is just one month, uh, a worth of data, so it'd be hard to claim a significant Victory. But it's consistent with the optimistic view that investors have of potentially avoiding a recession. Yet, the only way you avoid a recession is basically by the Fed U-turning That's the only. The only way you do this is the Fed realizes okay, inflation was in fact transitory.

Let's cut rates back to two percent and the Bull Run comes back right. Uh, but other than that, any kind of sticky side of inflation. He's screwed. You don't want to be exposed.

uh, and in the meantime, you'll get sort of a deflationary, uh price War amongst uh, sellers of products in my opinion, and eventually of services as well. I mean I We I just saw a report of, uh, potentially up to 30 percent of all Realtors leaving the market. Quite quite remarkable. So what effect does the second or third job to do these numbers? Yeah, so it generally when you have a second or third job, you get counted in the establishment survey multiple times because they count payrolls right from from the um, uh, from the employer's point of view.

Now, this is interesting. The December household survey. Okay, this note is just coming in. The December household survey.

came in extremely strong at plus 717 000. Where is that? Uh, that's interesting because that's the survey that everybody's kind of been paying attention to. To suggest that it might be more accurate. Well, if it's more accurate, it's coming in real strong.

That actually doesn't seem to show that unless we go to to count that we would have to go to employ. Oh that would be right. Yeah, that's what I was looking at and I was kind of scratching my head like that number seems like a big gap see look right here. This is the household survey.

I was looking at the number and honestly I was kind of like there's no way So I didn't say it. Uh, because I wanted to corroborate what I was seeing. but I'm like the household survey over here had a nominal gain right? This is from August to September What is that? That's that's like 150 000. Then over here the household survey was actually negative by about 250 000.

that it was negative Again by somewhere around 50 000. But look at this folks. this is a 717 000 job increase in the household survey. Oh, so that's not that great, right? Because a lot of people have been.

And we even started this video off by talking about how the Philly fad is like hey, the BLS numbers are wrong. We should be looking at the household survey instead. So now people are wondering is is the household survey just catching up to the establishment survey? Is the establishment survey right? and the household survey is catching up? Uh, uh or what the hell is going on? Uh, and and I think the reality is, nobody freaking knows what's going on. We just need inflation to go down.

That's it. So this is pretty remarkable actually. the unemployment rate. by the way, sitting at Uh 3.5 percent is the lowest level of unemployment since 19 since the 1960s.

Now, Uh again, this establishment gain is huge. 177k in establishment survey is massive. uh or sorry in household is household playing. Catch up to establishment are both wrong Market might not care Market cares about inflation and that inflation number is where we had.

the only thing to potentially cheer. and that's a downward Revision in November from 5.1 on the year year to 4.8 and again that month over month sitting at just point three right here. which is great I Want to see what's going on and interest rates? uh I Love how no one acknowledges that layoffs are being caused by AI replacing certain jobs. Group chat can't do that.

No, actually Ken you're right. Uh, Treasury yields actually pretty flat. which is really wild because indices are up like point four percent. but uh, treasury yields Being flat is, um, is really interesting because what this means when you have treasure yields flat like this? Uh, again.

I'm looking at the 10-year here. basically a two basis point movement. You're basically saying, hey, things are getting better, but we're going to keep Financial conditions tight. Now this is actually what the FED wants.

The FED in my opinion, doesn't so much care about the stock market. although that does go into Financial conditions so that you know the stock market falling is is a side effect uh, and a somewhat contributor to financial conditions being tighter. The big thing for financial conditions tends to be yields because they affect borrowing. uh, borrowing rates on cars on mortgages.

Things that really affect people's net worth like investing in Tesla Oh wait, uh. but anyway, yields uh, yields sitting stable at about 3.7 percent keeps Financial conditions tight. uh uh, little uh movement down on uh Jobs report. So I am also curious.

Now what is our five-year break even look like uh, five-year break even coming in? Uh, come on. I don't understand why it moves up still sitting at 2.7 Uh, what you really want or spread of 2.7 What you really want is you want this to go under two point or it's 2.27 You want this under 2.2 ideally under two. This This would be nice once this plummets. Uh Kevin thinks the FED is closer to U-turn So like if you're wondering like when is the Fed actually likely going to U-turn it's when that Lumber plummets and it hasn't happened yet in my industry I had to pay substantially higher wages.

Hence, price increases. Isn't that baked into longer term price increases? Yeah, sure. I Mean look, everything has gone up right like we saw in the ADP report. Year over year, people who change jobs saw their wages go up 15.

but that doesn't actually mean they're really making more money if prices have gone up. you know, 15 to 40 percent over the last few years. So yeah, I mean we're We have a lot of price increases that have occurred. Uh, now we just want to see those price increases.

Stop. Like, please stop. Price increase is going up. That's the goal right now.

and there's a little bit of hopium in this report, so that's good. Uh, if you're frustrated that you're not getting notifications from YouTube YouTube limits how many notifications you can get per day. So we actually built an app to solve that problem. Just download the Meet Kevin app in the Google or Android app store and then you'll get notifications if you want them all the time for for new YouTube videos.

So if you're frustrated that you're not getting all the YouTube notifications, just download the Meet Kevin app. Uh, in the Apple or Android App Store People refusing to work in the private sector aggressively replacing them with automation? No way. Yeah. I I I Don't know how much automation is? Yeah, Really really affecting? Uh, these numbers yet? Really? I Mean, if you think about it, all of Silicon Valley could lay off, uh, everyone that's working in Silicon Valley and it would really only represent like three percent of the entire labor force.

Uh, like you know, we hear about these big Tech layoffs, but they they're not actually the biggest part of these labor reports. The big parts of the labor reports are: Leisure Hospitality Restaurants Health Care Education. Those are where we're seeing the big gains right now and again. a lot of these industries still sitting negative uh, from where we were in 2019.

So not a surprise to see some gains there. And that I think is why the market is so focused on. well, let's just pay attention to what's happening with Uh with wage gains, you know the market realizes there are a lot of uh Jobs still to be gained in. uh, even travel, right? Pilot shortages? uh Staffing shortages I mean just look at the Southwest disaster that happened right? A Lot of these things over the holidays were the result of uh, crappy, uh, uh, like Staffing uh, problems, uh, and uh, poor Staffing management.

So you ended up getting stuck with uh, thousands of canceled flights I mean Southwest is going to report a loss for the fourth quarter because of this, uh, this disaster. so we'll see. Uh, okay, so let's just take a brief look to see how the Market's behaving. Uh, okay, so on the negative you have Bed Bath and Beyond which is basically trending towards bankruptcy down 14.

Then you have this uh, small company called Tesla which basically according to Wall Street is also trending towards bankruptcy town about seven percent. That's off of the eight percent that it was just down. Looks like a lot of folks are really excited for Tesla to get under a hundred dollars a share and they might get that today. I Would guess if it were going to happen, it would happen within the first minute or two of the stock market open because that's usually when you get the institutional weenie babies that continue to contribute to the dumping chairs.

But that's okay because retail is also dumping Tesla It seems like everybody is dumping Tesla All right then you've got X bang and Lee Auto also down about 12 to 8 Dave and Busters Dude, you could have put all your Tesla money into Dave and Buster's and probably been flat all year long. Let's look at that year over year Dave and Buster's stock. Oh oh oh oh, you could have put all your Tesla money into Dave and Busters. You would have only lost 1.6 in the last year.

You lose seven times that much holding Tesla today as Dave and Buster's has lost all year over year. like I'm not talking about like the last six days I'm talking about in a year. Yep, uh yeah, that's that's called fundamental. Oh wait, no that's just called suck.

Um, then you've got uh, Sunron actually up 4.3 percent whereas a Solar Edge Solar Edge got a pretty decent valuation right now s Edge sitting at uh of 0.73 in pre-market here 276. house and fees. Are they under 200? yet? no, they're at 240. they certainly come down almost 100 points.

Uh, since their crazy run over the 300s which is remarkable. but uh, this is a phenomenal company. It's just quite overvalued right now. And I I do hope their valuation compresses so we can add a larger valuation or a larger allocation to end phase because it's a phenomenal company.

But anyway, uh yeah. so I would call it good news. Uh uh oh Nikki T Nicky Leaks Nikki Leaks is talking. Hold on.

hold on, we gotta get our boy. Nick T Man, can we get our boy Nick T on the channel? That'd be cool. We need our we need our boy Nick T over here. uh Nikki T Nicky T Make sure to turn on notifications for Nikki T So Nikki T says look at that.

revisions to average hourly earnings paint a marginally less worrisome picture for the FED on wages. He calls it marginally less worrisome. So it's It's like, hey, it's better, but it's only marginally better I could see Jerome Powell texting Nikki t Nick It's good, but our job ain't done yet. It's only marginally better.

Three Reports doesn't make a trend. You know what's going to end up happening is in a year from now I Think you're going to end up having like memes? Can somebody like put like put a little note on their calendar January 6 2024 Okay Kevin says Jerome Powell is a meme and this is the meme. Jerome Powell is is gonna be. It's gonna be him like looking like Haggard and like old and Evil and it's gonna be like this.

Three Reports: No 12 reports of declining inflation don't make a trend. We must continue to hike and then the next day they're gonna be like no, we're gonna cut rates by two percent and and it is like inflation will be gone. The stock market will be back in rally mode and everybody in a year from now is gonna be like damn it I I Wish I bought uh like everything's so much more expensive now I Know that's really hard to imagine because a I could be wrong. uh and B uh uh.

You know when when stocks are so down and you're in like the shitty times of the stock market, you feel like things are never going to recover. and then you start kind of comparing. like how much you lost, how much you're making and you're like oh I just lost 10 years of my work. uh and it makes you feel like hopeless right? This is what the stock market does like.

This is normal. so um you know. I I try to keep your head up no matter uh, how how you're investing or how you're playing the game. but uh I wish you the best out there.

and uh yeah, somebody write that down, let me know if I'm right in a year from now. Uh, in the meantime I encourage you to suck on one of these prayer potions. See you in the next one, By the way. Quick update: I Start flying this.

Uh, tomorrow? actually? Oh that's freaking awesome. We start flying with Baby Jet tomorrow and uh, on the 11th we start inviting. uh, shadowers. So uh, we'll take a few days to edit footage.

uh after we fly. but uh, we'll probably start posting a lot of Vlogs of me flying to explore different towns for Real Estate So I hope you subscribe uh to to see that it'll be kind of like uh I feel like it's going to be like the reality show of hunting real estate in a recession so it's gonna be pretty ridiculous. Uh, in the meantime, suck on your prayer potion and we'll see you soon! Goodbye.