I hope you all are able to buy ourselves a cowboy hat last time that i talked about the broad market, because i'm gon na do a little bit of ta here, for you really quick, it's a pattern that many people are familiar with. It is uh infamous probably the telltale sign of any sort of price action here, i'm just going to draw it up nice and simple, and it is the infamous arrow that is uh. The ta pattern that this spy has followed holy wild west, no joke there guys welcome back to trace trades hope, you're all chilling. It is your boy trey, coming back again for another video i'd like to purposefully stand, modified fire survivors.

What you got ta! Do you already know how it is today the fed talked about the current state of the economy, and it is looking pretty, as you can tell, by the reaction of the market uncertain uh. That's probably the best word for it is uncertain. I listened to the entire fed talk and i've summarized kind of what i think are the key points, so we're gon na start off by going over what is probably jerome powell's primary goal, which is to lower inflation, obviously uh, and then you know dive into some Of the things at stake, as well as what he plans on doing to basically come to some sort of resolution, and if you might think to yourself well, this isn't going to affect my investment. I would challenge you to to look at every other investment that exists out there.

You look at uh the spy at about two o'clock uh eastern today. You can see that it coincides with basically every other stock tanking. I mean you look at plug. You look at fuel cell.

You look at amc, obviously right at that exact same time. Everything plummeted, so the fed who has created this disaster has also created uh any any stock that you're dealing with the same disaster. So the primary goal of jerome powell, who is the chairman of the fed, it's the lower inflation of two percent, as he once said, he believed that inflation was transitory. We all laughed, we all scoffed uh, knowing that that was absolutely and he's finally recognized that it is in fact which has led to what they're going to be doing, which is tightening the economy.

What has happened over the past year or so is that the federal reserve or the fed has basically influxed cash into a lot of different places. They've, given uh money out to banks, they've given money out to institutions, they've they've kept rates very low for a long period of time which allows you to buy houses cheap. It allows more people to put money into the stock market. It allows the economy to flow and now that they basically see a shift, they see that uh inflation is starting to go up which is sort of this.

This divergence in terms of balancing the economy and balancing the market they decided to flip the other way and jerome powell infamously has been very bullish he's for a long time. Basically, uh dovish is a good term for this stating uh. We think that inflation's transitory. It's nothing to be worried about nothing to be worried about then a flip of a dime he's changed.

His stance he's become very hawkish, and now he is bearish on the current state of the economy. He wants to really tighten things down and i think there's a little bit of an obstacle here and to be frank with you, i think, there's two things that i'm focused on the first is that he remains in the same stance. I don't want to see this pussyfooting around with jerome powell of uh. Oh today, i'm gon na be this or today, i'm gon na, be that he bounces around a lot, depending on, in my opinion, who the political, uh or leadership is in his ear right and you can kind of see you know joe biden kind of threatened his Job a little bit, this is uh information that i was first introduced to by meet kevin.

He stated uh that that binance kind of pressured him he said. Look you got to really fix this, we're going to fire you and he's really diving into it. So we'll see my my faith in jerome powell and the fed is not great. I i stand by the outlook of a couple months pull back in the market in a recession, and you shouldn't be too concerned with that uh.

If you've paid attention to the video that i'm gon na link above here, which is how to trade in a bear market, i do think it's very important to be able to hedge against long positions as a bull in a upcoming bearish market. That's the way that you protect your investments uh, while you're waiting to buy the dip or if you are buying the dip on the way down. That's just me, you do what you got to do uh, besides, that there are also some stakes on the line here and that comes down to the economy short term. Now i did tell you guys a while ago that i do think that there's uh a reality of a short-term recession.

There's just too many things that have happened right. You can see inflation uh rampaging. It's just been increasing month over month over a month compared to the year-over-year growth of typical inflation, which is affecting the market, but on the opposite side of that coin, uh you also have jobs and wages according to jerome powell that are actually improving, they're they're at The best levels they've been in a very long time and at stake for me and a question that i think is justifiably asked by the people who are asking him questions at the end of his speech. Uh we're asking.

Are you worried that you're going to over correct and that you're going to affect jobs and wages, and i think that there is a possibility that that does happen? I'm not going to take a stance on whether it will or it won't. But i do think that is a stake at hand. This is not just the stock market right. This affects uh your job.

It affects how much you pay for a gallon of milk. It affects how much you pay for a gallon of gas. It affects whether or not you're able to go to your your christmas parties, or you want to go drive to an amc, theater and watch spider-man no way home for the fifth time. Like me, i mean at the end of the day, these are all things that affect real people's, tangible lives and can't be undermined, and i think justifiably so the market reacted in the way that it did, because it kind of got a nothing burger.

I mean jerome powell really reiterated the same, that we've heard before uh even down to uh. We don't know the exact number of rate hikes that we're going to have. We don't know when they're going to happen. We do know, as of now that they're likely not going to happen until march, which means a couple more months of uncertainty and, as we've talked about before on this channel, uncertainty breeds, fear and fear, breeds bears, which could very easily lead to a short-term recession.

And a short-term bearish market, so with all that being said now that you kind of understand the situation sort of the preface into uh, this fed talk that happened today and perhaps why it affected the market. The way that it did, i mean you can see this huge volume bump across. Basically all stocks iwm, the the russell 2000 all mid cap - sort of companies, growth stocks, uh volume, just quadrupled in the matter of a minute. It was basically right when that speech started and flipped very bearish.

I want to talk about what jerome powell plans on doing to manage inflation and the state of the economy over long haul, and that is very simple. It's to raise rates. He wants to hike rates right, which is pr. It could happen a couple times this year.

Maybe three, maybe four, he didn't specify and that's uncertainty. That's i think, personally, why you got the reaction that you did out of the market where things really pulled back pretty hard. He also wants to asset taper, and you saw this it's kind of a goofy thing. You don't think about it.

I didn't think about it until recently, but the fed purchased a lot of securities within the u.s stock market, which i've talked about before kind of led to this uh. This prolonged year and a half squeeze of of stocks, growth, stocks, value stocks, your blue chips, mid caps, your small caps, everything went through, basically a historic bull run, and a lot of that was due to money that was influxed into the the market by the fed And obviously, there's other things that factor here i mean you have uh all-time highs in terms of reverse repurchase agreements, which is the transactions that happen back and forth between banks and the federal reserve uh, because they have to park money in certain spots. They exchange money for a treasury note, and that happens overnight. They do that over and over and over it's obvious that banks have a lot of money.

Otherwise you wouldn't see all-time highs on those uh. Those reverse repurchase agreements, and that brings me back to the asset. Tapers, so where are they going to start moving their capital well likely not into the us stock market and probably more so back into uh the opposite of what you're seeing happen right now, with the reverse repurchase agreement? They're gon na tighten things you're, probably not gon na see banks having as much money which is gon na raise rates. It's gon na raise interest on how much you pay for a line of credit or for a mortgage or uh.

If you wan na, go to a loan shark and take out a hundred grand to throw into the stock market for a yellow, i mean at the end of the day, it's your money, it's your money, but it's gon na affect all that stuff. It's gon na be more expensive to borrow cash when the fed does an asset taper, as well as a balance sheet decrease. So these are, these are his sort of solutions. This is what jerome powell has talked about, and my take on.

It is very simple. I think if you want to see a recovery out of the stock market, what i'm personally watching for is this political slash, leadership piece, probably the most. I just don't want to see him flip flopping around when jerome powell flip flops around when you you're kind of just chicken in between uh left and right, you're, accomplishing nothing, you're, just wasting people's time and ultimately money and nobody likes that. So i want to see him stay consistent, whether he's hawkish or he's dovish.

He thinks that we need to tighten the economy, he thinks we need to loosen it personally, i think we need to tighten it. I think it's pretty obvious. I think it's obvious that inflation's out of control, i think a lot of people see that as well, but he just has to stick to it. I think to be completely brutally honest: the economy, the u.s stock market, everybody in this country in this nation, uh kind of got.

We all did i mean the the way that covid was handled which ultimately led to this situation. Uh was poor and it affected the economy uh now, finally, in a lagging sort of way, and the ramifications of that are at full effect right now, and i think if you kick the can down the road, all that you're doing is making the correction. That's due. Probably worse, you know, so i think this is something that has to be taken care of and in the short term, that does mean uh likely bearish markets and that will affect everything.

My girl, amy amc, i mean, like you, saw this absolutely profound pullback off of what looks like a really promising balance up to 18. You know uh. It affects everything, especially especially small and mid cap companies. I mean if you look at the spot, which is large cap uh, top 500 stocks in the stock market.

It closed out negative 0.25 percent, but iwm, which is mid caps, growth, stocks, 1.44 percent. It's a whole different, beast whole different beast when you, when you're looking at these bearish markets - and that brings me to my final point and i'll - let you guys go on your way. Please put on your cowboy hat for this beast. It's that you can make money in a bear market right.

I don't think it's a good idea to just close out of uh all of your long positions, and i i want to speak on this briefly. I have no beef with me kevin. I've got no problem with his decisions, ultimately his decisions uh, but i i don't agree with him closing out of all of his assets for a bet right. Ultimately, that's what it is and he acknowledges that and then power to him if he wants to do that, then so be it uh, but i think that's a decision that many people regret that comes out of tommy timing, the market, if you think you can time The market, you think that you can, you can close out of a position and buy it back at the exact bottom, give it a shot, but there's not many people that can do it successfully, you're way better off riding the wave, don't fight the wave and, ultimately, The wave right now, especially after this meeting today, you're really not going to have much of a chance for any sort of uh correction on that uh is likely bearish until march i mean that's when jerome powell is going to come out and speak again and likely Raise rates - and i think that's when you could potentially see some form of a reversal, so uh guys hang in there.

I've said it before i'll say it again. This is not the end of the world, the market, uh and the economy. The u.s economy are due. It really really is, if you think about how much money's been printed, how many stupid decisions that the federal reserve and politicians in the sec have made in terms of the way that money in our country has been handled.

This is long overdue, uh, sadly, as is almost always the case in american history, we as the people as the 99 deal, with the ramifications of what the stupid one percent do, and this is uh. This is a ramification that we likely can't avoid. We have to. We have to find a way to to to ride the wave.

That's probably the best way that i can put this so uh ride the wave. My friends we're all we're all we're all in this goofy ass market together and uh once this is over, we'll be in the next synthetic bull run together. So that's what i've got for this, this freaking video i'll catch y'all, the next one, i'm gon na go get myself uh some popeyes, much love light taps peace.