Love your chart reading. But you must remember the chart is the tail and the dog wags the tail. The tail doesn’t wag the dog. Your chart reading helps know what the dog did and will be doing. We are cutting rates to increase supply for goods to reduce inflation because we are decoupling from China and bringing manufacturing to friendly countries. markets are up because they know we will win it unless you do something stupid and slow down the economy to prevent you from building the weapons to defend yourself from countries that are clearly showing their plans to conquer you if you let them.
Historically, the market always crashes after they start cutting rates.... It's not the cuts that cause the crash though. It's the reason that they cut the rates, that causes the crash..... Lagging indicators leading up to rate cuts
I’m not faulting Cory for being wrong here cause nobody can call what they do overnight unless you’re watching it. He kept that move in mind anyway and it happened.
When I got out of college in 1979 rates were at 12%! The entire 1970’s had rates from 7%+! This period is a rinse repeat except the dollar is worth much less. $1,000 in 1979 is worth $4,336.03 today!
@BrokerBarbara119 Finally a boomer that gets it. I'm a millennial and it seems every boomer I run into is blissfully unaware of the fact that the dollar they had 40-50 years ago was worth literally a full 4 times more than our dollar today. Most of them know nothing about how markets or economies work or what the Federal Reserve does, and they don't know who Paul Volcker was or anything like that. Basically they don't even know their own history that they themselves lived through. All they know is that the value of their homes and stocks appear to be going up, but they don't seem to realize that this isn't an increase in asset value, rather it is a devaluation of the currency. Your comment is a breath of fresh air, obviously you're financially educated.
Hey Cory, You're definitely not out of your mind and 100% you're up to something big here. Been following you for 4 years now and have noticed you're consistently right with your predictions and technical analysis. Would love to hear your prediction/opinion as to when you see a recession (mild, moderate or severe) actually happening. Thanks!
I personally think if we run up Monday and Tuesday that we could get a sell off come Wednesday. If we pullback going into fomc then we would get a 1-2 week rally off the news then get a huge sell off. Let’s see how this story plays out
Going from 550bps to 525bps in Sept is still very restrictive. If the Fed literally waited until recession to start cutting, it would become a depression, not a recession. If CPI continues coming down toward 2%, what's the point in NOT cutting rates? The Fed does not want to cause a recession if it is not necessary. As long as the Fed doesn't cut too fast, starting cuts this year is clearly the correct decision IMO. Again, 525bps is still highly restrictive. Even if it is 450bps before the end of this year, 450bps is still quite restrictive as well. Neutral is closer to 300bps.
If inflation stays at 2% and the market is fine, why should FED cut rate? The current rate match with current inflation which is good for the economy. Just don't fix it if it not break! Sign of market breaking is unemployment rate increase! As long as inflation rate stays around 2% and unemployment rate around 4%, market is just fine.
@@lapdo859 Agree, but look at the trend. In just 1 month CPI went from 2.9% to 2.5%. Unemployment has risen from 3.5% to 4.2% in less than 1 year. Clearly if the Fed does not cut, this trend is likely to continue, which could cause CPI to be negative (deflation) with unemployment over 7%. That's a so-called "hard landing." That's why the Fed intends to cut AHEAD of these issues, albeit slowly. It is literally a goldilocks problem: If they cut too fast, we will see a resurgence of inflation. If they cut too slow, we will see a substantial recession. There is a "sweet spot" to these cuts. I think what is likely is that the Fed Funds rate is ~3% by the end of 2025. This is higher than 2018/19 but not nearly as high as today. It is much closer to a "neutral" monetary stance. New Money just came out with a video on this topic, you should check it out. It was a good video.
Agree, but look at the trend. In just 1 month CPI went from 2.9% to 2.5%. Unemployment has risen from 3.5% to 4.2% in less than 1 year. Clearly if the Fed does not cut, this trend is likely to continue, which could cause CPI to be negative (deflation) with unemployment over 7%. That's a so-called "hard landing." That's why the Fed intends to cut AHEAD of these issues, albeit slowly. It is literally a goldilocks problem: If they cut too fast, we will see a resurgence of inflation. If they cut too slow, we will see a substantial recession. There is a "sweet spot" to these cuts. I think what is likely is that the Fed Funds rate is ~3% by the end of 2025. This is higher than 2018/19 but not nearly as high as today. It is much closer to a "neutral" monetary stance. New Money just came out with a video on this topic, you should check it out. It was a good video. [This is for @lapdo859 but YT is censoring the reply comment for God knows why]
@@lapdo859 current rates do NOT match the rate of inflation! Inflation is at 2.5%, rates are at 5.5%. the FED is extremely restrictive currently. Rates should already be closer to 3.5% at least.
Might add the market/rates were never trued after the 08 crisis.. & in the last CPI report, it was housing cost that caused it to come in a little hot and if they cut rates& encourage buyers to step in, & supply to shrink...
I agree with your analysis. And I thank you very much for the timeliness. Often times such valuable advice is given after the fact not speaking of you but in general. Thanks again I listen to you all the time
Good wake up call Cory. My thinking is that since data is always lagging we do not necessarily have to wait to see a recession happen before the rate cut begin. It is possible that the data we get in the next 2mth will show that we are in a mild recession and the cut this week is will help with preventing extreme overreaction. I will definitely be keeping my 1-2mth out Put contracts on SPY
I don’t agree. You need to stay ahead of inflation and also the recession. So prudently cutting rates ahead of a recession will make a more mild recession instead of a much worse one.
I have seen a few videos where people saved Walmart orders from a year ago. The cost of the order was $425 a year ago. They place the same order today and it totaled nearly $800. THAT is the true face of inflation.
People don’t realize that inflation (devaluing of your dollar) is compounding annually. So the avg peasant hears “oh it’s back down to 5% yay”, not realizing 45% of the value was already wipe out over the last 5 years. Fun fact, due to the exponential growth of the money supply, it is actually HARDER to maintain the same annual % inflation, you have to keep infinitely printing extra money just to keep the % the same annually. Maybe this will help others understand how much we print.
By inflation coming down, do you mean deflation? Deflation means absolute prices actually decreasing. Inflation is rate of increase, which is already down. I think you're way off on this. However, your confident tone may sway some people.
If everything is a lagging indicator and we won't know when a recession/depression happens until we get the data showing us coming out of it, then we are already in a recession/depression. It is always the path of least resistance to debase the currency. Cuts are going to be 50, 50, 50, then 25, 25, 25 until about 2.50% to 2% for more wiggle room in the future.
I call it the Tic Tac Toe economy. No won can win. Lower rates equall higher inflation. Decrease rates equall crash the economy. That's stagnation. Like you said my friend, " stuck between a rock and a hard place." Love your show brother
I am just sitting in UVIX its as low as possibly. how much lower ... yet how MUCH higher it can go ... good risk ratio here ... move like water if it turns. Hoping to make $$#$
I think you are mostly right. However wrong about the timing and also momentum and lag of policies. I think Jerome lowering rates won’t impact inflation much in the short term but has a 6 month lag. They are looking at momentum of increasing unemployment and that is his 2nd mandate. He isn’t looking at where it’s at currently but more of where it’s headed and at what acceleration of rate. He doesn’t want to be seen being late on rate cuts. Also typically we’re don’t get a bear market with recession fear rate cuts until usually the 2nd cut. So I believe we get a crazy rally with the rate cuts followed eventually in 4-6 months the beginning of a bear market. I think Jerome’s second mandate will force his hand.
corey, you READING IT WRONG, , as there is inflation, there is deflation, it's like pendulum swing once its starts it can't be stopped until it run it course, like price moving above and below the range , we heading into delfation, which is also bearish, actually it's very bearish. feds will have to cut so fast so many times to prevent deflation, but its already too late. resection is already in the bag, but first blow off top
ISTM your opinion is that past rate-cuts caused deeper recessions. Mine is that the Fed waits too long, then reacts to the inevitable. As for the markets, IMO they won't get healthy until after a global crash, no matter what Fed does... global debt is out of control.
Great video on TA involving the FEDS stupidity. Thanks Corey, and I agree. Lowering rates with the market near all time highs and housing as well is a recipe for disaster.
Ok. Even if yoy inflation comes down to even 1 %, that still does not help the 35% we have already seen and still have to deal with. So yes, a recession might help reverse some if that
You are absolutely right. I hold this view for sometime but you have FOMO retail investors keep throwing dumb money at it to get the market party going. You can either miss the upside or party with them with gambling money!
But this inflation is not caused by over heating. Instead it’s due to supply chain disruption, wars and tariffs. We have wrongly depended on Fed to fight this inflation problem. Hence sooner rates normalize the better as high rates are not addressing the issue instead creating more other issues such as credit stress and employment losses.
I didn't even know what a Roth IRA was back then. All I did was save a little here and there, but nothing serious. Looking back, it was such a missed opportunity
Interesting analysis. How would you explain market going higher 2018-2020 while we went to 0 interest rates and market went higher from 2022-2024 when interest rates went up? And in reality inflation rising throughout this period decreasing the value of our purchasing power?
Oh my - what did you take over the weekend. So dark. Good thing I went all in on TZA on Friday (as per your suggestion), I hope...! Grass fed milk was $6.99, now $8.99 - that is 28% - so I agree. Gas was $1,99 now $2.99 - that is 50%. Grass Fed hamburger was $6.99 now $9.99 up 42%. I think you are right perhaps. Sandwiches at Fresh Food marker were $5.99 now $8.99 - up 50%. It all happened due to WHEAT shoratgages, gas prices, not sure what happened to milk, etc, etc. Sticky inflation
You are not the only person saying an S&P drop to 480 is feasible. Personally don’t think we will see this anytime soon however as a contrarian I have a small position allocated to that scenario. Also taking some profits off the table to increase that position
Sometimes telling the future is not possible ,even when it makes sense . This Fed seems to be doing what he can. They may have info that we don’t understand . I’m sure they want it to work out. Also I don’t think they are just looking at the stock market . They may not have a good choice here.
At the end of the day, how much of an impact will a 25 or 50 bps reduction actually have on things? It’s not magically going to make mortgages crazy affordable or reduce credit card interest payments. It will help banks on their unrealized AFS loss positions, but whooptie doo. Either way it will take some period of time for the Fed to collect data to determine whether any rate cuts lead to a resurgence in inflation.
"Since 2021, we have had up to 35% inflation." Anyone know where this number is coming from? Cause I'm seeing a cumulative inflation rate much closer to half that at about 16%.
Yeah but what is 25bp going to do? If you said nothing you would be correct. At the same time what's going to drive a recession? Oh yeah deflation not inflation. Look at RBOB gasoline that's not good. What happens if products can't be sold for prices that pay the increases in salaries? There you're not just worried about unemployment that's when entire industries collapse.
@indianajones3315 I disagree with that. Cory is anything but stupid. The purpose of my comment wasn't to throw shade at his thesis but in hopes he might give us some more nuance about his own. The one thing Corey does understand is sentiment and I'm sure he knows what QE is going to do to traders.
History will repeat again and like your worries, Cory, I think rate cuts will drive inflation triple to 100% from 35%(your current level) and FED will lift the rate to 25% in a year or two. Humans tend to repeat their trends and this time things will happen in more radical fashion, because the economic environment has become much more radical thanks to QE.
Rates should not be cut. Rates are at a normal level and its time we stop providing cheap money that only spawns more risk taking. Inflation is much greater than what is reported because energy and food not included.
Economy naturally moves in cycles and is like a large aircraft carrier/cargo ship and does not change on a dime. Powell should have been raising rates sooner/more gradually prior to Mar'2022 (when he was saying "inflation is transitory"), and should now be lowering rates gradually. Effects of interest rate changes lag by 2-3 months.
Well Cory, I actually am getting broccoli spears airbrushed on all my new boards for winter and just watched your video at the gym… no shit and I completely agree with your hypothesis here. How can one not? 🤷♂️ this is a perfect example of why markets go up and down daily.
What if there is a melt up scenario taking place? The government has to service its debt off of taxes and taxes are higher on more expensive things. It could be everything is just going to get more and more expensive, including the stock market…
I love your channel and I agree with you on many things, but video I disagree with you a lot. I don't know how long you have been in the stock market but I'm 62 years old and I have been in it longer than you have been alive. In early 2008 the Fed started doing rate cuts while inflation was still high and the national average for unleaded was 4.11 a gallon. The recession didn't occur on paper until 8 months later according to government stats. At this point we are in a debt paradox and the government function at the current rates and will bankrupt the nation. Inflation actually exposes the value of the currency and Venezuela is prime example of this. Venezuela was experiencing a record high stock market during hyperinflation. I still believe even if they lower rates at this point that recession will occur and lower prices to some degree but it won't last. There will always be an expansion of the money supply and there will always be inflation.
Hello Cory. You are one of the best on RUclips. I have a lot of bond ETF’s and also have a lot of rate sensitive stock. My question is if the Fed cuts by .5 I would think both should benefit and if they only cut by .25 than they will sell off with the rest of the market. Most of my rate sensitive stocks include real estate, buy now pay later, and biotech. Any feedback would be appreciated.
Cory. I believe if he does 25 basis points at this meeting and waits. Market will not pull back much and has a better chance of hitting new highs but not by much. Then if the economy does not reinflate and goes into mild recession we will have a correction. I do believe we are in late cycle investing but good market can last another 12 to 18 months. After that bear market for perhaps a few to number of years.
Deflation, which is what you are talking about, is far worse than inflation. Fed won't let prices decline because that causes Depressions. They want perpetual mild inflation and steady growth. That requires lower rates. Federal debt is a separate issue. Might not be solvable in a democracy but won't be an issue in the next 10 years, so nobody cares today except for Ray Dalio. Otherwise, I love your TA and watch every video 😊
A big variable is the election; maybe a reason they might skip the lesser of two evils option. A market crash or mass layoffs (especially in key battleground states) before November could sway the election; so it could be the Fed Reserve best interest to keep the market propped up until the election is over rather than risk hurting the market soon.
The cost of housing is gonna be a problem. But the FED is 1000% gotta cut rates at this point. Also the being entitled part is a bit harsh, housing is at an all time high and has been. That being said, analysis is opinionated, and of course the market is gonna pullback it always does, even in a Bull market we get pull backs. Selling fear may work for the RUclips algorithm doesn’t make it right. And folks aren’t ignoring the trend line, but the probability of it touching is low right now, with the data we have now doesn’t mean it won’t eventually. You guys should stop with this well I’m right you’re wrong that’s not how the market works.
I agree with Cory and am confident the FED will due to wrong thing. I would warn against trying to time the drop. Like the man says… move like water. React don’t predict.
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Love your chart reading. But you must remember the chart is the tail and the dog wags the tail. The tail doesn’t wag the dog. Your chart reading helps know what the dog did and will be doing. We are cutting rates to increase supply for goods to reduce inflation because we are decoupling from China and bringing manufacturing to friendly countries. markets are up because they know we will win it unless you do something stupid and slow down the economy to prevent you from building the weapons to defend yourself from countries that are clearly showing their plans to conquer you if you let them.
Cory, one of your best videos. You demonstrate a more thoughtful approach.
Historically, the market always crashes after they start cutting rates.... It's not the cuts that cause the crash though. It's the reason that they cut the rates, that causes the crash..... Lagging indicators leading up to rate cuts
And specifically, the recession/market downturn typically happens 6 months after the first rate cut on average. The range is 3 months to one year.
Just came back here to say you're a fool 🤡
This is his most important video to date ... thanks!
Oh wow bearish Cory. We’re in for a treat.
My first thoughts from the title.
yep.... spx to 6k this week now easy
he did it again..hahaha
I’m not faulting Cory for being wrong here cause nobody can call what they do overnight unless you’re watching it. He kept that move in mind anyway and it happened.
Excellent video! Your analysis is spot on! Thank you!!!
Very interesting
One of the more intellectually stimulating vids I've seen from you in a while. I enjoyed this broader picture analysis. Wish we'd get more of this.
Thanks Corey, great content. We need to be prepared for all scenarios. My strategy keeping spy but also buy a year long put.
When I got out of college in 1979 rates were at 12%! The entire 1970’s had rates from 7%+! This period is a rinse repeat except the dollar is worth much less. $1,000 in 1979 is worth $4,336.03 today!
@BrokerBarbara119 Finally a boomer that gets it. I'm a millennial and it seems every boomer I run into is blissfully unaware of the fact that the dollar they had 40-50 years ago was worth literally a full 4 times more than our dollar today. Most of them know nothing about how markets or economies work or what the Federal Reserve does, and they don't know who Paul Volcker was or anything like that. Basically they don't even know their own history that they themselves lived through. All they know is that the value of their homes and stocks appear to be going up, but they don't seem to realize that this isn't an increase in asset value, rather it is a devaluation of the currency.
Your comment is a breath of fresh air, obviously you're financially educated.
Hey Cory, You're definitely not out of your mind and 100% you're up to something big here. Been following you for 4 years now and have noticed you're consistently right with your predictions and technical analysis. Would love to hear your prediction/opinion as to when you see a recession (mild, moderate or severe) actually happening. Thanks!
Good job! Thanks for pointing out the history. Could also go sideways. Somehow panic seems to be the prime mover of the market.
Really enjoyed this Cory, not sure if it's worth your time but if is, would love more of these types of analyses from you!
Hmmmm. Nice job. Most sense I’ve ever heard you make. Bravo.
The best video I have seen you produce, well done and well said.
thank you for the history lesson and the analysis that ties it all toegther!
Amazingly instructive and educated video. Commonsense market analysis. Thank you Cory.
Great video! I’m going to hit the gym 🏋️♂️ and eat some broccoli 🥦 🙃
I personally think if we run up Monday and Tuesday that we could get a sell off come Wednesday. If we pullback going into fomc then we would get a 1-2 week rally off the news then get a huge sell off. Let’s see how this story plays out
Going from 550bps to 525bps in Sept is still very restrictive. If the Fed literally waited until recession to start cutting, it would become a depression, not a recession. If CPI continues coming down toward 2%, what's the point in NOT cutting rates? The Fed does not want to cause a recession if it is not necessary. As long as the Fed doesn't cut too fast, starting cuts this year is clearly the correct decision IMO. Again, 525bps is still highly restrictive. Even if it is 450bps before the end of this year, 450bps is still quite restrictive as well. Neutral is closer to 300bps.
If inflation stays at 2% and the market is fine, why should FED cut rate? The current rate match with current inflation which is good for the economy. Just don't fix it if it not break! Sign of market breaking is unemployment rate increase! As long as inflation rate stays around 2% and unemployment rate around 4%, market is just fine.
@@lapdo859 Agree, but look at the trend. In just 1 month CPI went from 2.9% to 2.5%. Unemployment has risen from 3.5% to 4.2% in less than 1 year. Clearly if the Fed does not cut, this trend is likely to continue, which could cause CPI to be negative (deflation) with unemployment over 7%. That's a so-called "hard landing." That's why the Fed intends to cut AHEAD of these issues, albeit slowly. It is literally a goldilocks problem: If they cut too fast, we will see a resurgence of inflation. If they cut too slow, we will see a substantial recession. There is a "sweet spot" to these cuts. I think what is likely is that the Fed Funds rate is ~3% by the end of 2025. This is higher than 2018/19 but not nearly as high as today. It is much closer to a "neutral" monetary stance. New Money just came out with a video on this topic, you should check it out. It was a good video.
Agree, but look at the trend. In just 1 month CPI went from 2.9% to 2.5%. Unemployment has risen from 3.5% to 4.2% in less than 1 year. Clearly if the Fed does not cut, this trend is likely to continue, which could cause CPI to be negative (deflation) with unemployment over 7%. That's a so-called "hard landing." That's why the Fed intends to cut AHEAD of these issues, albeit slowly. It is literally a goldilocks problem: If they cut too fast, we will see a resurgence of inflation. If they cut too slow, we will see a substantial recession. There is a "sweet spot" to these cuts. I think what is likely is that the Fed Funds rate is ~3% by the end of 2025. This is higher than 2018/19 but not nearly as high as today. It is much closer to a "neutral" monetary stance. New Money just came out with a video on this topic, you should check it out. It was a good video.
[This is for @lapdo859 but YT is censoring the reply comment for God knows why]
@@lapdo859 current rates do NOT match the rate of inflation! Inflation is at 2.5%, rates are at 5.5%. the FED is extremely restrictive currently. Rates should already be closer to 3.5% at least.
@@lapdo859these ppl are the kind that think if you go back to 0% and have infinite debt that it’s good for them and the economy lol.
another side of Cory, the economist 😎
Love your channel!! Thanks for the update and advice!!!
Might add the market/rates were never trued after the 08 crisis.. & in the last CPI report, it was housing cost that caused it to come in a little hot and if they cut rates& encourage buyers to step in, & supply to shrink...
You make a great point!!!
Yet another outstanding, objective video. Great work Cory! Thank you
Like and agree with the analysis, but what about 'we just follow the price action". ....
Thanks, Cory. One of your best videos ever. Could not agree more
I agree with your analysis. And I thank you very much for the timeliness. Often times such valuable advice is given after the fact not speaking of you but in general. Thanks again I listen to you all the time
Stocks tanking after rate cuts is a crowded trade at this point. I don’t see it happening until early next year.
You are right on track !!!
Good wake up call Cory. My thinking is that since data is always lagging we do not necessarily have to wait to see a recession happen before the rate cut begin. It is possible that the data we get in the next 2mth will show that we are in a mild recession and the cut this week is will help with preventing extreme overreaction. I will definitely be keeping my 1-2mth out Put contracts on SPY
I don’t agree. You need to stay ahead of inflation and also the recession. So prudently cutting rates ahead of a recession will make a more mild recession instead of a much worse one.
I like your channel for TA
Well done, Corey!
Thanks Cory!
I have seen a few videos where people saved Walmart orders from a year ago. The cost of the order was $425 a year ago. They place the same order today and it totaled nearly $800. THAT is the true face of inflation.
People don’t realize that inflation (devaluing of your dollar) is compounding annually. So the avg peasant hears “oh it’s back down to 5% yay”, not realizing 45% of the value was already wipe out over the last 5 years. Fun fact, due to the exponential growth of the money supply, it is actually HARDER to maintain the same annual % inflation, you have to keep infinitely printing extra money just to keep the % the same annually. Maybe this will help others understand how much we print.
This is laughable cuz you fell for anecdotal data and clickbait. Did they show their bills for home heating, electricity and gasoline? Wonder why not?
By inflation coming down, do you mean deflation? Deflation means absolute prices actually decreasing.
Inflation is rate of increase, which is already down.
I think you're way off on this. However, your confident tone may sway some people.
Excellent video Cory, plethora of very pertinent information, thank you for all the hard work
If everything is a lagging indicator and we won't know when a recession/depression happens until we get the data showing us coming out of it, then we are already in a recession/depression.
It is always the path of least resistance to debase the currency.
Cuts are going to be 50, 50, 50, then 25, 25, 25 until about 2.50% to 2% for more wiggle room in the future.
I call it the Tic Tac Toe economy. No won can win. Lower rates equall higher inflation. Decrease rates equall crash the economy. That's stagnation. Like you said my friend, " stuck between a rock and a hard place." Love your show brother
Correction. Increase rates crash the economy
Correction. Stagflation.
I am just sitting in UVIX its as low as possibly. how much lower ... yet how MUCH higher it can go ... good risk ratio here ... move like water if it turns. Hoping to make $$#$
thanks Cory
bought 10 545 puts on friday at market close exp friday. Well see.
I think you are mostly right. However wrong about the timing and also momentum and lag of policies. I think Jerome lowering rates won’t impact inflation much in the short term but has a 6 month lag. They are looking at momentum of increasing unemployment and that is his 2nd mandate. He isn’t looking at where it’s at currently but more of where it’s headed and at what acceleration of rate. He doesn’t want to be seen being late on rate cuts. Also typically we’re don’t get a bear market with recession fear rate cuts until usually the 2nd cut. So I believe we get a crazy rally with the rate cuts followed eventually in 4-6 months the beginning of a bear market. I think Jerome’s second mandate will force his hand.
corey, you READING IT WRONG, , as there is inflation, there is deflation, it's like pendulum swing once its starts it can't be stopped until it run it course, like price moving above and below the range , we heading into delfation, which is also bearish, actually it's very bearish. feds will have to cut so fast so many times to prevent deflation, but its already too late. resection is already in the bag, but first blow off top
Curved ball would be another pause while everyone is expecting a rate cut.
ISTM your opinion is that past rate-cuts caused deeper recessions. Mine is that the Fed waits too long, then reacts to the inevitable. As for the markets, IMO they won't get healthy until after a global crash, no matter what Fed does... global debt is out of control.
Great video on TA involving the FEDS stupidity. Thanks Corey, and I agree. Lowering rates with the market near all time highs and housing as well is a recipe for disaster.
Sitting on cash until the dust settles. A positive year when rumors of pending storms is not a bad place to be..
Just wondering. Why do you want 35% to decrease? I still don't get. A normal growth of inflation is around 2% yearly, so you want a deflation?
Great video
Ok. Even if yoy inflation comes down to even 1 %, that still does not help the 35% we have already seen and still have to deal with. So yes, a recession might help reverse some if that
YOY inflation is now at 2.9%, i think a rate cut is the correct move
about time boy. the last big dip a month ago was the time to have this talk.
Last month to now we had a nice runup. Plus October is when we tend to see a large drop
I have inflation estimate around 35% as well. Varies where you live. Some areas lower but some are even higher
Excellent vid! We bought Belgian chocolate in 2021, bought the exact same thing today and paid 102% more for the exact same quantity.
You are absolutely right. I hold this view for sometime but you have FOMO retail investors keep throwing dumb money at it to get the market party going. You can either miss the upside or party with them with gambling money!
But this inflation is not caused by over heating. Instead it’s due to supply chain disruption, wars and tariffs. We have wrongly depended on Fed to fight this inflation problem. Hence sooner rates normalize the better as high rates are not addressing the issue instead creating more other issues such as credit stress and employment losses.
the problem is youre right about inflation #'s, but the government has put out much lower #'s to screw with everything
I agree you’re smart man
I didn't even know what a Roth IRA was back then. All I did was save a little here and there, but nothing serious.
Looking back, it was such a missed opportunity
Interesting analysis. How would you explain market going higher 2018-2020 while we went to 0 interest rates and market went higher from 2022-2024 when interest rates went up? And in reality inflation rising throughout this period decreasing the value of our purchasing power?
F it, selling everything…I’ll be back in the 2nd week of October hahaha
Or just wait until April 2025
Oh my - what did you take over the weekend. So dark. Good thing I went all in on TZA on Friday (as per your suggestion), I hope...! Grass fed milk was $6.99, now $8.99 - that is 28% - so I agree. Gas was $1,99 now $2.99 - that is 50%. Grass Fed hamburger was $6.99 now $9.99 up 42%. I think you are right perhaps. Sandwiches at Fresh Food marker were $5.99 now $8.99 - up 50%. It all happened due to WHEAT shoratgages, gas prices, not sure what happened to milk, etc, etc. Sticky inflation
You are not the only person saying an S&P drop to 480 is feasible. Personally don’t think we will see this anytime soon however as a contrarian I have a small position allocated to that scenario. Also taking some profits off the table to increase that position
You are absolutely right
Recession is pretty much bake in with inversion of yield and it has been right since 70s.
I keep hearing of more and more layoffs.
Any coupon for your discord?
Will a stock market pull back be conducive to inflation reduction?
Sometimes telling the future is not possible ,even when it makes sense . This Fed seems to be doing what he can. They may have info that we don’t understand . I’m sure they want it to work out. Also I don’t think they are just looking at the stock market . They may not have a good choice here.
No.. you are spot on.
Just one word - “Agree”
At the end of the day, how much of an impact will a 25 or 50 bps reduction actually have on things? It’s not magically going to make mortgages crazy affordable or reduce credit card interest payments. It will help banks on their unrealized AFS loss positions, but whooptie doo. Either way it will take some period of time for the Fed to collect data to determine whether any rate cuts lead to a resurgence in inflation.
Indont see it coming down no more then 20 percent before it goes higher like it has been since it started
"Since 2021, we have had up to 35% inflation."
Anyone know where this number is coming from? Cause I'm seeing a cumulative inflation rate much closer to half that at about 16%.
Yeah but what is 25bp going to do? If you said nothing you would be correct. At the same time what's going to drive a recession? Oh yeah deflation not inflation. Look at RBOB gasoline that's not good. What happens if products can't be sold for prices that pay the increases in salaries? There you're not just worried about unemployment that's when entire industries collapse.
Cory doesn’t understand this. He’s a pure price action trader, not an economist.
@indianajones3315 I disagree with that. Cory is anything but stupid. The purpose of my comment wasn't to throw shade at his thesis but in hopes he might give us some more nuance about his own.
The one thing Corey does understand is sentiment and I'm sure he knows what QE is going to do to traders.
This market needs to hit the gym and eat some broccoli! 😂
What about small caps? They got destroyed on whispers of rate hikes.... have not recovered and will get clapped again with rate cuts?
History will repeat again and like your worries, Cory, I think rate cuts will drive inflation triple to 100% from 35%(your current level) and FED will lift the rate to 25% in a year or two. Humans tend to repeat their trends and this time things will happen in more radical fashion, because the economic environment has become much more radical thanks to QE.
Rates should not be cut. Rates are at a normal level and its time we stop providing cheap money that only spawns more risk taking. Inflation is much greater than what is reported because energy and food not included.
Economy naturally moves in cycles and is like a large aircraft carrier/cargo ship and does not change on a dime. Powell should have been raising rates sooner/more gradually prior to Mar'2022 (when he was saying "inflation is transitory"), and should now be lowering rates gradually. Effects of interest rate changes lag by 2-3 months.
Well Cory, I actually am getting broccoli spears airbrushed on all my new boards for winter and just watched your video at the gym… no shit and I completely agree with your hypothesis here. How can one not? 🤷♂️ this is a perfect example of why markets go up and down daily.
Well said cory
Cory for President, he's the man who knows!!!!!!!!
Great video!
What if there is a melt up scenario taking place? The government has to service its debt off of taxes and taxes are higher on more expensive things. It could be everything is just going to get more and more expensive, including the stock market…
I love your channel and I agree with you on many things, but video I disagree with you a lot. I don't know how long you have been in the stock market but I'm 62 years old and I have been in it longer than you have been alive. In early 2008 the Fed started doing rate cuts while inflation was still high and the national average for unleaded was 4.11 a gallon. The recession didn't occur on paper until 8 months later according to government stats. At this point we are in a debt paradox and the government function at the current rates and will bankrupt the nation. Inflation actually exposes the value of the currency and Venezuela is prime example of this. Venezuela was experiencing a record high stock market during hyperinflation. I still believe even if they lower rates at this point that recession will occur and lower prices to some degree but it won't last. There will always be an expansion of the money supply and there will always be inflation.
Hello Cory. You are one of the best on RUclips. I have a lot of bond ETF’s and also have a lot of rate sensitive stock. My question is if the Fed cuts by .5 I would think both should benefit and if they only cut by .25 than they will sell off with the rest of the market. Most of my rate sensitive stocks include real estate, buy now pay later, and biotech. Any feedback would be appreciated.
Sorry, this is already priced in, and then some.
I LOVE YOUR PRESENTATION!!! FINALLY , SOMEONE WHO UNDERSTANDS ECONOMICS AND AMERICA'S DENIAL ABOUT DEBT ADDICTION
Cory. I believe if he does 25 basis points at this meeting and waits. Market will not pull back much and has a better chance of hitting new highs but not by much.
Then if the economy does not reinflate and goes into mild recession we will have a correction. I do believe we are in late cycle investing but good market can last another 12 to 18 months. After that bear market for perhaps a few to number of years.
We are firmly in mid-cycle, and growth scares always occur at these points in economic cycles.
Cory, the New Fed Guy…….out with Powell.
Hell fucking no
Deflation, which is what you are talking about, is far worse than inflation. Fed won't let prices decline because that causes Depressions. They want perpetual mild inflation and steady growth. That requires lower rates.
Federal debt is a separate issue. Might not be solvable in a democracy but won't be an issue in the next 10 years, so nobody cares today except for Ray Dalio.
Otherwise, I love your TA and watch every video 😊
A big variable is the election; maybe a reason they might skip the lesser of two evils option. A market crash or mass layoffs (especially in key battleground states) before November could sway the election; so it could be the Fed Reserve best interest to keep the market propped up until the election is over rather than risk hurting the market soon.
Make sense to me!
The cost of housing is gonna be a problem. But the FED is 1000% gotta cut rates at this point. Also the being entitled part is a bit harsh, housing is at an all time high and has been. That being said, analysis is opinionated, and of course the market is gonna pullback it always does, even in a Bull market we get pull backs. Selling fear may work for the RUclips algorithm doesn’t make it right. And folks aren’t ignoring the trend line, but the probability of it touching is low right now, with the data we have now doesn’t mean it won’t eventually. You guys should stop with this well I’m right you’re wrong that’s not how the market works.
He’s cutting 25bp more than that we have a problem
Take it from a former engineer: Smart people aren't that smart. AI is pure hype, and I'm certain this is beginning to reveal itself.
Ai is making our lives easier on a daily basis and these are just the earliest stages, strongly disagree, I use it everyday
@@okchaz6634 It is not AI. It machine learning (smart algorithms with petabytes of pre-processed data) and its been around for a long time.
try Grammarly and tell me ai isn't good.
There's a reason you are a former engineer.
@@bikerunswimjb There isn't much upside from Grammarly..
The last two times fed cut rates SPY dumped 50% history will repeat 🔁. Load up on VIX on Monday
I agree with Cory and am confident the FED will due to wrong thing. I would warn against trying to time the drop. Like the man says… move like water. React don’t predict.