A oh oh oh brother oh brother oh brother. First of all, I'm not liking how many people think I've slept with negative one woman in my life so uh, not the uh, come on come on guys, guys like it's at least zero you think I somehow went into negative territory. That's how you want to start this show. Seriously, seriously negative one here I Was thinking we were going to have a good day here I was thinking that we're going to have some fun banter, be on each other's side.

but I can tell that you guys are already in a a very combative mood. It sounds like sounds like you're in a very, very combative mve. but whatever by the end of the show I'm going to switch it all around I'm going to be turning that frown upside down because we're going to have a good day and I'm not going to let your negativity drag me down because it's LT LT gray Friday So I hope you're wearing your own LT gay shirt folks. this ain't no normal Friday This ain't no normal Friday October The 6th.

This is unemployment Friday October The 6th and that's why we're starting early. So I do appreciate you probably going to bed at what 6:00 7:00 p.m. so you could be be up in time for today's early early early morning show pretty much here at the crack of dawn. so I very very much do appreciate it.

Welcome back to another episode of the MTC show where we're going to be talking about random thoughts in my head: the economy, the stock market, little bit of politics I have some Tesla update for you I have some trading updates for you I have some option updates for you I have some life updates for you I have a lot of updates for you and it's Friday TG I Hope you guys already have your reservation for whatever your closest Texas Roadhouse is I Don't want to hear any of this baloney of like oh but Matt the closest Texas Roadhouse is a five hour drive I don't care every Friday that's what we do we go to Texas Roadhouse that's how we celebrate the week and obviously the first week of a new month. It is now officially Spooky season. one of my favorite seasons of the Year probably actually my favorite season of the year. so I hope you're enjoying it as well I hope your football team's winning and if your football team is like my fantasy team.

Uh, it's been been a rough start. we have not really had Victory quite yet, but hey, at least maybe we can make it make it make ourselves feel a little bit better by maybe just maybe locking in some degenerate trades within the market. I Hope you're ready for it now before we get into all that. Shout out to today's stream sponsor I'll cover it more and more detail just a little bit later on, but it's Factor 75.

It's a food delivery service I've been eating it for lunch now for the past 3 to 4 months. Easy peasy! Lem Squeezy. The food's good. You can see the calories, the protein.

they have all these different options. But anyway, if you want up to potentially up to $150 off, the link is pinned to the top of chat. it's in the description of the video. Shout out to Factor 75 for being today's stream partner.

Once again, you could get up to $150 off. Click on that link and the affiliate and all that stuff should already be in there. So the code the discount code should be applied. Um, if you're already a Factor 75 customer I Don't know if it works, it might be for first time.

So if you are factor 75 customer already for the food delivery whether for lunch, dinner, whatever, uh, maybe try it out and see if it like applies the discount to you. I'm actually kind of curious I probably should have asked that beforehand, but but hey, this is what they get. So we're starting early because in a mere four minutes Quattro Uno Doo Teso Quattro Uh, we're going to be getting the unemployment rate report and the rate is expected to be at 3.7 Last time around, it was 3.8 we're actually at a not at the low I Think we've bottomed out a couple months ago at 3.3% 3.4% But in general, in the past four or five decades, we're actually had a very, very, low reading, once again suggesting how strong the labor market is. And the only reason I'm bringing this up is because don't forget that the Fed the Federal Reserve the people who are in charge of our funny money.

They're effectively trying to push this up to about 4.5% So in a we weird circumstance and this has been kind of the theme pretty much all year is good economic reports send the market down, while bad economic reports send the market up because a bad economic report suggests that maybe what the Fed's doing is actually working and they're trying to hamper demand. So like That's why we're kind of in the upside down world. But I Just want to let you know. Last time around, it was 3.8% This time, the median analyst estimate is coming in at 3.7 but we're going to find out the answer in a little bit.

And obviously it's good to know when these things are happening because there's always extra volatility and whatnot going on. But if you've been a member of the show for any amount of time, you know we're big fans of our boy Rick Selli. and there's a very, very good chance that our boy Rick will be reporting the numbers, so it's always a good day to see. Rick Um, expectation is 3.7% I Think it's going to either be plus or minus .1 1% On top of that, generally it's not like a wild wild surprise.

Yeah, they could do some funny stuff with how they're reporting numbers and sometimes big corporations. They choose to either add job listings or pull job listings just to mess with it if they want to fight it against the government really. particularly the Federal Reserve So there could be some weird stuff going on. but I I Really? don't think so? Um so I Just want everyone to be a little bit prep for that, but fully expecting some volatility today.

But first of all, stock futures rise slightly as Traders wait Friday Jobs report will be coming out in about 2 minutes. Here's what you need to know about the Big Jobs Report today: Friday Friday's nonfarm payrolls report will provide a major test for Wall Street which has been on the edge all week about a surprisingly resilient labor picture. Economist Surveyed by the Dow Janes Expected number to show 170,000 net gain in nonfarm payrolls 170,000 Keep that in mind. Expectations for Fed rate hike low.

Now it's about 30% 25% in the next Fomc meeting which is Wednesday November 1st is when we get the results. could change with a hot payrolls number which is what some Wall Street Uh, some of Wall Street are expecting September Jobs Report: May The be the last good one before the sharp slowdown. so we're looking at 170 173. That's the number of looking for jobs added uh and obviously percentage of unemployment in the realm of 3.7% Uh, and obviously right now at the market, why is it so pivotal? Well, let me scroll out here.

You kind of get an understanding that we're right in this dangerous breakdown territory. We've had this nice trend line from October to November recently breaking down below it. So now the question is: is this a fake out breakdown? Will the job report be quote unquote? Good enough to push the market at back up and we recover this or is it actually going to send it the other way and we're going to break through 420? Maybe head down to 415? Maybe head down to 410? Uh, big big decisions to be made? Uh, big big action. Definitely coming our way.

Uh, if you look at that, that's the overall. Market If you look at bonds, they're still vomiting like no other. which. I Some people are saying the risk of banks blowing up the medium Regional Banks mediumsized Regional Banks I Don't think the risk ever disappeared because we all know that they yoed into bonds when yields were way way low and now bonds are vomiting and then on the opposite side you have yields that are absolutely ripping and the dollar is even coming back with a bit of engine.

so there's a lot of things going on that I Don't know if the banking risk ever ever really left the system, but anyway, there's going to be a lot of movement today and I want you guys to get ready for it? Uh, sounds like Dan Santis is talking right now. Let's see what he has to say: terms of his electability? Uh, he's a going to be. He would be a lame duck on day one if he could even get elected I Think he'd have major problems with personnel and of course he didn't deliver on his core promises to drain the SW for the B wall or to eliminate just vomited from 424 down to 422. The fact that the Market's going down is telling me that the economic report was probably good as more jobs added than anticipated, lower unemployment rate than expected.

Probably a good report leading the market down. All right, let's get right over to Rick s with those numbers take away: Rick yes jobs numbers for the month of September nonfarm payroll a whopping $300 36,000 much stronger than what was expected in the 165 to, and if you look at the unemployment rate remain said. something in the at 3.8% and if we look at average hourly earnings, they also remained It Up 2 1% Now real quickly up 3.8% happens to be the highest of at that level running and on the wages month over Monon average hourly earnings up 2 P that is the smallest 22 and it Remains the smallest feary 22 With back to back take a year-over-year perspective, average hourly earnings are 4.2% 4.2% That is the lowest level going all the way back to June of 21 4.2% and average, uh, week 34.4 We've had a lot of 34.4 34.3 happens to be the lower realm, but we're very close and 62.8 on the participation rate. Uh, it remains there.

That's back to back, which means best since February of 2020. And finally, what I refer to as you6 is the underemployment rate? That's 7% It was 7.1 7.1 last last month was the highest since February of 22. Now I don't see the revisions I don't see the revisions because we do have a record I want to pay attention to through July every month has been revised lower. First time since recordkeeping in 1979, interest rates have moved higher.

We've moved basically up towards the 479 to 480 level and if you look at pre-opening equities, they have moved lower. Obviously headline number job because one could make a case. much of the rest of the data is actually on the softer side and we want to pay very, very close attention to how ultimately this moves the yield curve. Which by the way, Tu the 10 is now under 30 Minus 30 basis points at minus 29 Becky Back to you and the panel.

Holy cow, Rick that is a lot to digest. Stay with us in the rest Jobs panel for some instant reaction on this We who's the former Counil Economic Advisor chair professor at Harvard Ken Three of these people. Definitely Two of these people. are AI Systems Sorry to make it so it's not live, but there is no way you're telling me this is an actual human.

This is not a homo sapien. This is a very very Advanced system AI System Neuralink got out a little bit too early. This not a real person har Kennedy School of government Tyler uh those? uh longer term unemployed? Um none of you can convince me that that's a real person. You also have maintain this participation rate.

the FED would look at this and say you know what we we we seem to be having the workers and they're not coming at a higher price right? So the 02 on the wage number is going to say you know what we have strong puts printing so hard to it Ernie Good for you man. Cated a lot of extra money to come back to work. Um, we've seen some of the job growth where we saw it before. I think I saw a number in Leisure and Hospitality of up 92,000 Uh, that's a big number.

We did have a 29,000 jump in. uh, state government education. There's been some seasonal adjustment stuff of how many teachers were fired or hired or came back, so we kind of expect it a pop there. But when you put together this blowout number together with the prior two upward revisions, grab some popcorn shrimp and blowout report from earlier.

know what movie? I'm on the down blowout number Bur Also get a big kind of to those Fed officials that have been saying we're seeing softening in the labor market and that's what we want to see. So I don't know that the FED is in a place right now where they're going to be A In order to bring down inflation, you have to soften thep in the 10 and the twoe too two years out 5.14% the 10 years. Those are significant jumps that we've seen since this number hit. Sarah The move in the market is 21% chance now of a rate hike in the November meeting this headline number is Market Continue to digest moving away from a soft Landing to a hotter for longer economy and that's going to be negative for the market.

There are a couple ofs though labor years might be going up to 5% I think put rates are continuing W but we need to nonfarm payrolls here and look at first of all what are revisions going? They have been basically negative and also from the jolts number our professional service is continuing to grow. If that's where the growth is isn't great, those are some demand Siiz Wores noise in this number. So this the markets now have to wait for the next Catalyst which is going to be Q3 earnings and see if companies are saying that the economy is still you working the daily chart on oil dropping from 95 toed for long time, about activities and what this means. At this point it may not be the Fed that's really calling the shots.

Yeah, how is it's just vomiting? Yeah. Look, my first reaction to these numbers was really just being surprised and shocked. Um, my second reaction was feeling decently good about them. Um, we're creating jobs at a clip.

This guy gives me the Vi that he actually was out partying all night like he's just like a hardcore partyer, probably into some weird rate, but we have seen a higher participation rate. so maybe what we're see thisy been on like a Bend I Get the Vi that he made some good trades lately, just the low number, living life right? The last three months they've risen at a 3.4% Just if that continues, that is fully consistent with inflation. um, in the mid to low twos. My biggest worry is that prices had been moderating, but that it wasn't going to be sustainable because you you with rapid nominal wage growth.

With that wage growth coming down, maybe what we're seeing here is labor Supply increasing jobs being strong. There's only one thing I'm like actually good at in this world it's not trading. It's not analysis, it's not streaming. Maybe you could argue a little bit of fashion, but the only thing I like I'm quality at in this world into the jobs market and employers very obviously reading people them back because they need the work.

um you should be teaching to the point that the only thing on my resume exact LEL vior um coming here too. In terms of the FED um the tenure has risen so much that is doing a lot of work for them. um I think at this point frankly they should have a high bar vomited from 42 all the way down to 420. we lost4 and5 in 4 minutes.

Tyler You agree with all that an expert vibrator you say agreement with with Jas I Think the story of the the past few months has been one of supply and lo and behold price is thisy market so we've had wage growth. You can't trick me that I Know it's early in the morning but you're not going to trick me a lot of workers uh, both from unemployment and from out of the labor force. The one thing that has me scratching my head a little bit is I don't this is not a real person evidence of that Supply look even theera must some of digal Labor Force big decrease in those not in the labor force I Think the signs of those estimates are correct for this latest estimate. Uh, but the M look like you J you keep your mouth shut, you keep your mouth shut when you're talking to me is a bit more volatile and prone to revision.

Hey Jason can I go back to you for a second? I'm I'm curious if you could give us sort of your political take on this because I think think you've had a maybe a LoveHate relation I don't know what I don't know where the administ this current Administration thinks of some of your views situation. but as you now start to think about what 12 months looks like from now thinking right ahead of an election, where do you think the economy you know, what is that economy actually look like? Oh and they revised revision number 227 from 187. Good reason Market's too hot but a hot right now all of the die and it comes up one you get. A recession comes up two through six.

Um, you don't I think that's roughly the situation Kennedy Maybe there's some things that make me more nervous than usual like the high long-term rates. but other things like this labor market momentum are you know reass unemployment did tick up a little bit. they expected 3.7 came in at 3.8 but everyone's looking at the numbers come down with more out more action by the fed and if that happens and it gets sustain that would be very good news for the put on him. And M IM shut up shut your mouth.

Illegal immigration in some extents. Maybe the reason that the jobs Market is who we're getting political, not having to pay as much inflationary wages right? I mean a lot of these Asylum Seekers we're seeing on The news are not um, you know, are not the ones who AR aren't working, aren't being allowed to work, but you know, just process accessing visas. All of that, um, and yeah, that both helps demand. Um, it helps Supply and it enables you to sustain higher employment growth without driving up wage growth in the way.

Otherwise is this guy saying that minorities are lazy makes it good Dude, that's crazy man. you shouldn't say that on National Television as well I Don't see what a weird political way to say something super racist is a softer was with him for a second there when I thought he was just a part Rel I Still think they cl to that idea that Phillips curve idea Tylor Do you want to weigh in on this? Is this something you think that forces the FED to perhaps reconsider? Want do another quarter point or even more in the face of this strong? see how much they like pucker up when they're ask like obviously political question theye ask. please don't ask me. There are members of the committe who don't buy that you have to break the labor market in order to break inflation.

But in so far as a very strong labor market does give rise to an uptick in wage inflation down the road that does kind of set a floor below which it's hard for Price inflation to go on a on a sustainable durable basis. I Would add that if you look at the long history of the Federal Reserve they have made a fair number of big errors, public errors over the years and and the late macroeconomist Harvard Macroeconomist Julio Rotenberg wrote a paper on noted that when they make a big error, they tend to enter a period of penitence of repentance for the past sin. and until there's a big narrative change, they tend not to see it to exit that period of of repentance or that period of penitence. Hey, Tyler Um, it's been well documented.

How Americans feel uh about the E even in the face of of things like I'm not I Know you guys, Maybe it's inflation I Don't know. But when you see consistently strong labor growth in an economy that's uh, sort of confounded the Skeptics what do you attribute it to? Can we attribute it? Ask? It's all in the for to just Keian forces. Talk to my therapist about that one. You know, stimulating infrastructure growth and you know, chip development, subsidies for for, uh, green energy? Or is there something that's working organically about? That dude has the face of someone who got paid to on a bipartisan basis.

Is it working? Is any part of Biomics actually working? I Mean if you throw a few a few trillion dollars in subsidies at targeted sectors, you're probably going to get both price and quantity increases in those sectors. The challeng is that in a three and a half% unemployment World in an 8% mortgage rate world, yeah, that is a world that is scarce in capital and labor. And so you're going to be P world that scarce in capital and labor favored sectors into favored sections sectors. and I Would just add that in terms of the disconnect between a very strong economy and the almost recessionary levels of consumer confidence that we see reported I Think the key to that disconnect Is that real wages are well below where they would have been had they continued on prepandemic.

Trend And by some measures, they are still, uh, lower than they were in 2020 in absolute terms. So I think that that decline in real media and household income is a big factor in the disconnect between this, the evidently strong economy and the the the really poor way in which consumers are thinking about this Sa the economy. Jason Would you be on CNN And a point Counterpoint with Tyler right now? or were you nodding and think some of it's partly true I Partly agreed, partly disagreed. Um.

in the short run: I Think this is stimulus. We're seeing a larger deficit that's supporting the economy in the long run. That complicates things. It's higher interest rates and you really do get crowd out.

Um. Congress decided and it was bipartisan that they did want to redirect resources towards certain sectors like chips like infrastructure and then not on a bipartisan basis. Um, to some green energy. Um I Broadly think that's right, but I think on the medium term.

Yeah, that's going to be a reallocation of capital cap, not um, a net addition to Capital The other thing I'd Note: by the way is consumers are reasonably Negative They are much less negative. um, than they were Um, six months ago. I Think they are noticing that inflation is coming down, that they're making up some of the ground they've lost, but they definitely haven't Did you guys catch that right there? Do you guys catch that little graphic? September Unemployment breakdown. And they have disabled which I Don't know about you, but I don't necessarily consider that to be a a race of people, but hey, maybe the new age we're living it in.

It is a race of people. But anyway. Black Hispanic White Asian Asians As many people would expect, it are absolutely crushing it. But remember this graphic, we have Disabled black Hispanic White Asian.

It is the September unemployment breakdown. you fast forward a little bit. Uhoh uhoh, How do I get to the next graphic? No, there was one in between. Nope, Nope.

Nope. Nope. Negative. um than they were um six months ago I Think they are September Unemployment breakdown Jobless rates for women Is it me or is CNBC really Towing some political lines Is this saying that there's no Asian women The last graphic had black Hispanic white and Asian and now that we're talking about it for women, are they? They're either saying all Asian women are employed or they're saying there's no such thing as an Asian woman.

I'm just here I'm here to call out the real facts to you guys. I Know you guys come to me for a little bit of Truth In the world of financial reporting and my Eagle Eye detail oriented content wants to bring this to your attention. Either there's no such thing as an Asian woman or all Asian women are unemployed. just want to throw that out there.

do whatever you want with that. maybe all Asian women are disabled. You guys have a problem noticing the arms on the octopus today. Thank everybody on the job speaking with a top portfolio manager new leading indicator disabled Asylum Seeker Boy has this been emphasized this morning? Stay tuned.

You are watching squawk Fox and this is CNBC you guys took that away we shouldn't have and then I wonder why I get kicked off of YouTube us 10year yields returns to a 16-year high after better than expected Jobs report. It's because all Asian women are employed CNBC Already had the answer early early this morning. For all of us that is. Um, that's that's actually crazy That did they just forget a section that is ridiculous that that had to be a mess up? No no way.

no way. September Jobs report may be last good one before a sharp slowdown. Well, they were expecting 170 173 and what did it officially come in at 336? Unemployment came in a little bit higher than expected, but the payrolls number was a barn burner. Say it with me class, it was a barn burner if we continue to see a cooling labor market and infl.

Speaking of people who you know how to like, they have a good time when they party totally daily. like there is no Fed member out there more than daily that I would expect to be like hardcore part here. Mission Heading back to our Target we can hold interest rate study and let the effects of policy continue to work. Even if we hold rate study exactly where they are today, policy is going to grow increasingly more restrictive as inflation and inflation expectations fall.

That's a pretty fair take. Um, side note: you you guys might be surprised to find this out. I was in fact not invited to speak at the Economic Club of New York I'm not even I know we do a lot of joking I know we do a lot of josing around with each other, but I'm actually being really, really honest right now. Uh, I was in fact not invited to speak at the Economic Club of New York and makes you wonder.

makes you wonder what's going on. Make sure make you wonder what they're seeing that we're not seeing that I did not catch an invite to be the VIP Marquee guest speaker. Um, but I don't know. just spitting some hard truths.

The 5% bond market means pain is heading everyone's way. The impact will be felt in everything from Shoppers Pockets to company balance sheets not so long ago in a universe Far Far Away Families, businesses, and governments were effectively living in a world of free money. The US Federal reserve's Benchmark interest rate was Zero while central banks in Europe and Asia even ran negative rates to stimulate economic growth. after the financial crisis and through the Rona period.

at that point in time, we all had a lot to live for. Life was great. We had money, we didn't have depression. We weren't beholden to the internet algorithms that run my life.

you know. My mom understood my job was a coder. She didn't have to explain that I run a podcast thing to her friends that she plays Hy with and they all give her a weird look of like, doesn't he have a college degree? didn't he go to school to be a coder and he was a coder at a bank and now he does a podcast thing. We didn't have any of those issues.

It was very, very easy for my mother to explain my life and then everything took a turn. Everything thing took a turn in 2022 when Daddy pal Mr Money printer go Burr decided he's no longer the party guy. he's no longer the designated drunk driver. It's time that he's he's sobering up, he's putting his life back on track, and he's going to take care of this little problem we call inflation.

Yes, we can fawn over the yester years, but if you believe in the linear nature of time, we're here and we're here now. And arguably this is the only day we currently have. but that's obviously also just for people who believe in the linear nature of time. So I don't really want to get into that for now I Struggle to see how the recent yield moves don't increase the risk of an accident somewhere in the financial system.

Given the relatively abrupt end over recent quarters of a near decade and a half where the authorities did everything they could to control yields my question to all of you Benchmark Bonds fa new paradigm of higher yields US 10 year rip and faces off German 10 year RI and faceing off and even now, the flight to safety. the Yen trade is even starting to break down cuz the Yen Ted year is even starting to pick up. That's a little bit of like a nerdy Financial trade thing economic thing. but just so you know, this is actually arguably maybe even a bigger deal than the thing we're seeing in the other two.

Uh, I mean the the Yen trade is now maybe a dead trade? Uh, but my question to all of you. Uh, especially as we're here talking about macroeconomic things, Do you think more banks are about to blow up? Serious question, not rhetorical. I Expect everyone to uh, write in their answer. Now by the time the stream delays over I TR What? In the past year, we've had two of the three largest bank blowups known to man: Signature, Silvergate or Silver.

Yeah, Silvergate Watergate Silvergate Silver. Whatever. Um, we have a lot of people they were looking at pack. W A Lot of people were working at the What it Like Western Alliance A lot of people were just looking at the ETF Kre, which tracks the regional banking sector.

actually. Speaking of which, how would this K look K vomited back in March tried to recover Going back South team going back south I Have serious reservations about the regional banking sector. Uh. Ernesto San Martin is continually saying the word fraud.

You know there's a lot of Internet SLU in chat right now and we're really good at extrapolating out and understanding what people are talking about. But you got to give us more than one word. You're just saying the word fraud Like what? What are you saying is a fraud? Are you saying Central Banking Systems fraud? Are Are you saying Regional Banks are frauds? Are you saying I'm a fraud? Are you saying CNBC is a fraud? Are you saying the employment rate related to Asian women is fraudulent? What? what? Give us this conversation is basically the same conversations I used to have with Piper before I realized she was meowing in Spanish I was trying to help her and she was saying stuff I was like what are you saying, are you hungry? are you tired? Do you want your like, do you want little head scratches and then I we have had better lines of communication I realized that she was meowing in Spanish and now obviously uh I would brush up on some of my feline based Spanish and now I could properly communicate with her. So similar to that I'm going to ask you help me help you You're saying the word fraud.

What's maybe I agree with you Maybe I don't agree with you I Do you know what I think's fraud. This whole concept of having to separate your whites from your darks when you're doing laundry actually I did did think that for a while I thought it was like a giant lie perpetrated by the grandma industry. like you got to separate them recently I Bought a new pair of red sport shorts for the gym when I crush it on the stair stepper and I mixed that in and there was some other colored clothes dyed clothes in there and then also some white stuff. uh and now that is all.

has like a pink red Aura to it. So maybe the grandma industry was on to something. Maybe you shouldn't be washing brand new clothes that obviously have die in it. Uh but anyway, is that what you're talking about? Are you talking about big laundry? Now he's gone.

They got him. They already got him. They already got him. This is what happens.

He came Ernesto came in in here trying to speak some truth and this honestly has the exact same Vibe as like the CIA came from them. Well if you ever get internet connection again, let the rest of the community know what you're trying to sound the alarm on because I can already tell you we're on your side. We are 100% On Your Side Uh back to the craziness of the market. How are we actually doing? Ooh we made a fresh we actually snapped 420 at 1 second.

spooky season just got a lot scarier folks. JP Morgan's Marco Kalinov, Kalinov, Kovic, Kovic Dude there's C in times where I think Hooked on Phonics as a child was stupid and it's like a lot to the it. It's a lot of the reason that I have like a ninth grade reading level and then there's other times like that where yeah did it take me a couple tries it did I'll be honest with you, replay the stream but sometimes Ken OIC like I crushed it sometimes I feel like Hooked on Phonics really knew what was up anyway Marco braces for a 20% Market plunge delivers. Recession warning JP Morgan's Marco K Novic on recession watch braces for a 20% Plunge in stocks Now before we give it a listen.

Do you guys agree with this dude? Do you guys agree with this? Dapper Mr Marco Or do you think he's just kind of like pandering and talking book and he's like oh, we have that giant doesn't JP Morgan have a giant collar trade on right now? Is he just trying to like talk his own book and get the collar trade to play out anyway? I Just let's listen to it. We have a lot of time today. Well, the Institute investor Hall of Famer known to move markets is bracing for a Sharp market pullback. Marco Kovic is JP Morgan's Chief strategist and co-head of Global Research It sounds like a depression medicine.

Thank you. Yeah, Beautiful. Perhaps multiple times. In fact, he deserves it.

Um, Marco You like so many people started the year very bearish on stocks, you stuck with it pretty much it's it's been not an easy ride, but at this point in time you do see the pain coming. No. so we had the price Target at 4200. Uh and sort of dude thought this is going to be a more volatile year that we'll see more sort of chop.

Instead, we got that summer rally. Holy Institutional Investor Hall of Famer he's the number one ranked Equity strategist 10 times in a row I've never been anything 10 times in a row. The longest streak that I have is I Don't know if you guys ever had this in your high school, but we had like a Spirit Week where every grade competes against every other grade uh, three years in a row I Won for my grade representing my class, the Pin The Tail On the Donkey competition. That's that's no lie.

I Right hand up to God right hand up to whoever you want me to put my right hand up to uh three times in a row I For my class, I represented my class, my graduating class, the 20122 class P and Pin The Tail On the donkey and I won it. And the reason it's not 4 for four is because one year they took Pin The Tail On The Donkey out of the competition. and then obviously, as you would expect, there was a massive massive Uprising so they had to bring it back for the remaining years. But I mean that's pretty cool too 10 times in a row as the number one.

Equity Strategist: I mean not necessarily A Champion pin the Tail on the donkey player, but whatever primarily drain by Tech you know, which was, sort of, uh, very painful when that market came down sort of to to our price Target and we we remain uh, uh, somewhat negative. still, you know, so not necessarily calling for immediate sharp pullback, but we do think that recession will eventually happen so sort of upside versus downside is stocks is not that great. But this this gets at the conversation we were just having in terms of of timing. You can be an investor who believes that recession will hit, that there will be some sort of a landing, some sort of a recession and that the pullback will come.

but it's hard to position yourself at this point in time because we just I don't know the job, Market's still strong job market is still strong, but you are starting to see I Just want to point out that Melissa Lee is in fact an Asian woman who's employed. Just a little bit of a side note there. Uh, you. inflation is there and and um, um, rates are higher for longer, you know, Like so this uh thing will eventually come right.

and uh. So then we look at sort of upside versus downside, right? and you know, could there be another five six? 7% upside in equities? of course, right? Uh, but if there is a downside, it could be 20% downside, right? And now you compare that to the cash. Uh, 5 half% You know. So now how much? Equity upside above 5 and a half% So maybe 3 4% But then downside, 20% right? Like, So that's that.

like. So timing was very right. and and this year particularly and we didn't get it. Timing.

Uh uh. good. That said, we still stick to that. It's not attractive, it's not exciting.

There is an alternative and recession. I'm not sure how we going to avoid it if we stay at these level of interest rates. Um, so now what do they call it when a video goes viral? A viral Viral viral? Crazy. Well I mentioned that because Rick Santelli was here the other day and his call 13% went viral.

I mean million and a half views? Now you probably saw that. What are your I Don't think you think rates are going there, but what are your thoughts on rates? here? we are at 4.7% Real question it's it's pretty high right? And then when you compare the multiple of call top seven right you know or in general multiple of NASDAQ or S&P it just doesn't add up. You call it when goes viral, doesn't add up with a multiple PE you call Jeff Um, the other thing is, uh, what's going to happen right? So rates could actually go a little bit higher. you know I think uh, the you know the 133% might be.

You know things would probably break a lot sooner than that happen. So I don't think it goes that high you know, but could could go up a little bit a little bit more which is already I Think problematic for a multiple. So Marco there's been two markets. there's the NASDAQ and you know the Magnificent 7 whatever you want to call them.

And then there's the rest which have been flat or down right. Do you think that it is possible to just have a recovery out of those into others? So that's that's a very good point, right? Like So Russell's down 2% for the year, right? The cash is up 5 and a half% right? Like So, Uh, S&P Equal weight down the world according to Mark Magnic. Magnif seven up a lot. right? Like So Two.

Course of course of action. You know if you don't one of these days, I Promise you folks, I'm going to put it out into the universe right now because it's going to happen one day. I'm going to have a show like this and it's going to say the world according to Swaggy. T And obviously I'm going to be swagy.

T CU That's what everyone calls me. Um, it's not going to be Marco anymore and it's going to be better graphics. Really? just like some pictures that pop at you. Uh, but it's going to be the world according to swagy.

I'm telling you it's going to happen one of these days. Believe that there is a recession I Guess bu those right by the ones which are lagging right. You know recession doesn't happen. They will lead right.

You know? Um, but don't buy these magn magnificent right? Like if there is recession I Think Mag magnificent. one catch up or catch down to where where the rest is, you know, Like So so whether you want to take aort of recession um you know there's also you know like So some things got what saying mention sort of Staples utilities and those type of things. um some of the Sacred CS so Marco part of what I think's got you into the Hall of Fame uh in the strategist world is also you. You have a Quant kind of approach and a Quant background and a lot of the I you know I just feel like the market we've had is something to do with positioning.

Something to do where sentiment is and it just seems to me that that's been part of the story and hindsight, that's always easy. Crazy on how many are voting Yes, remember your call in March of of 20 excuse me with Co and you were just like this is crazy this is this is a screaming by um sentiment feels awful when just six weeks ago people were I think over their skis yeah uh no that that That's a very good point. So positioning does matter a lot and and and it did matter this year as well. So we started November December with very low positioning you know Tech pretty much everything.

volatility was still high. uh and then volatility was coming down pretty consistently this year. You know, as volatility comes down, many of these technical investors like Volt targeters CTS they all little by little sort ofre recessions sping 20% plung in the like exposure to cash right now I mean when it's yielding over 55% like a lot of these bonds Bond lading techniques are summer now picking up. you know Vix is not anymore.

123 Now it's like 1819. Um, and uh and so I think Yu-i what Marco has to say uh on this Doug crazy on how many are voting yes for AMC So we have some other Market things to go on about. but I guess for right now we might as well talk about it. uh AMC looks absolutely horrible unfortunately and I'm saying that as a person who still owns AMC Uh, I'm not happy with it.

but I'm particularly not happy with the leadership team because I think they're being intent Ally dubious taking advantage of a very uninformed retail base if you listen to some of these Twitter space calls. If you read some of the very, very supportive tweets or Reddit posts, it's people who are like, clearly caught up in an echo chamber. They're clearly caught up in a cult. Um, they don't know what they're talking about.

They're incredibly uninformed. They just make things up. and that's crazy. And a lot of these people are being duped into voting yes for Adam on one particular proposal which basically absolves him of any legal liability because of his recent decisions.

I am of the opinion that no, why would I give you legal Absolution when you should just be doing things that aren't illegal anyway. Um so I voted and I don't care how you vote if you own AMC you should vote I'm not going to tell you how to vote I'm letting you that I threw in a lot of NOS I don't remember how many proposals there were and which ones I did yes and no on uh, but threw in a lot of NOS So if you have AMC cash a vote, there is a shareholder meeting uh coming up in early November and one of them specifically was about basically saying the officers of the company um, it's granting them extra legal protection which is blowing my mind blowing my mind I don't know who would vote yes if you would vote yes to that U feel free to share your opinion. Uh, maybe you're seeing the situation differently than I do, but if you vote Yes I very very much think that you need to have your head examined. but once again, I'm not right on everything 100% of the time I'm wrong 50% of the time, 50% of the time I'm right 100% of the time.

whatever you want to call it maybe I'm wrong, maybe I'm looking at it inappropriately. Maybe I'm missing some sort of update because I don't really cover it that much I don't really spend much of my life anymore paying attention to it. But from what I know about the situation, granting extra legal protection based on how everything's gone, and once again, again, let me just zoom out. So I can show you how everything's gone.

You need to have your head examined if you think that this needs extra legal protection. No freaking way. Once again, my opinion. Do whatever you want with it, it's your call.

But I I'll I I Just don't get the argument and feel free if you're like, well, hang on I'm looking at it like this, this and this. Okay, send it to me. I'll read it over uh, but blows my mind. uh, little bit of a political update just because we've been covering this whole craziness of the government shutdown leading to Kevin McCarthy's outing of Speaker of the house and then obviously we now have a ticking time until we, uh, default or not default.

Excuse me Shut run out of money, government shut down. Uh I think we're at what? 40 days? maybe? right? in the realm of 40 days mid. November So obviously they're trying to get a new Speaker of the house. Uh, Trump endorses Ohio's Jim Jordan for house Speaker over Scalissi is that? is that how you say it scalesi Hooked on Phonics I'm telling you, we are now hearing that former president Trump may have revealed some nuclear submarine secrets to an Australian businessman.

What's this about? Yeah, this is you know Trump holding meetings at Maral Lago Trying to tell visitors some of the information he has. There's been other examples of Trump doing this in the past. This involves: G Out secret code the New York Times reporting uh, that an Australian um, businessman heard you know. Basically stuff like how many Warheads can a nuclear submarine hold? how close can the submarine get to to Russian Subs Um, things like that video volume depends.

really. this is them. I'm maxing shared how sensitive was maxed out on my system. It's maxed out to you some insight National Security Uh, that remains unclear at this point.

Um, we haven't heard yet from the Australian we're seeking that. but yeah, it's another example. what Trump is being prosecuted for in the US at the moment SC scal scal lame. um I thought that was actually going to be more about Jim Jordan Hang on Donald Trump endorsed representative Jim Jordan as the next speaker of the US House of Representatives giving the nine-term congressman from Ohio the for former president's coveted stamp of approval going into next week's leadership elections.

That seems like a big move because Ohio in many elections ends up becoming a swing state. so I'm sure Donald Trump would love to play nice with him just to increase his chances of getting more votes in Ohio Congressman Jim Jordan has been a star long before making his very successful journey to Washington DC representing Ohio's fourth Cong congressional district. He will be a great all capitalized speaker for the house and has my complete and total endorsement. Uh, obviously Trump is currently the front runner and he's also currently dealing with various legal issues and the whole thing is just I would say at this point in time.

uh, kind of like the normal crazy that our politics has now become. It's almost interesting to think about a time before, let's say even before I don't know Obama I I Feel like what our new normal is is just on a relative basis? Like absolutely ridiculous, But that's where we're at in life, which is now kind of crazy. Uh, anyway, back to the market. things are not looking so hot.

This morning we were at one point above 425. We're currently at 421 2020 Uh, which is basically the low from yesterday. So obviously I'm watching that we have big support here between 420 and 421. This dollar region is very important if it doesn't hold.

My next watch is between 47 17 and 418. I think I have it better marked over here. Um so I guess 419. why did I Mark that out? I don't actually like that I like this 416 level a little bit more.

so if the 420 to 421 region does not hold, my next Target would be 46 in some change on the spies. Let's see how the Q's are doing this morning I'm assuming also taking a hit. Whoa! The Q's went from 360 all the way down to 35378 bouncing up right now to 35 55. That is Brutal Tech sector being hit.

Obviously, we have some important support right here in the range of 354 355 and then once again at the low 353. If this region here at the low 353 doesn't hold I would next be watching I suppose all the way down here at 348. Obviously, 350 is a key technical level, a key psychological level. So yeah, I'd probably be watching that.

But in terms of just the price charts, uh, I'd be looking at 348 to see how the market reacts there. Dude, today's looking a little bit brutal Matt Your scream is always quiet. Well, Chris your stream is always quiet. How about the how about them apples? Chris You want to talk about the volume of my stream? What? Why don't you not throw stones from a glass house? I've tuned into your streams before and there.

You have to have supersonic batlike hearing to hear yours. Is that what you want me to say? Chris Are you happy? Now You're making fun of the volume of my stream. Yours is so quiet that no person over the age of 60 can hear it. You exclusively have an infant age group listening to your stream because they're the only people with good enough hearing to listen to your stream.

is that is, Is that what you want to do today? Chris Chris Are we going to fight about it? Huh? How do you like that the only people listening to Chris I Didn't want to bring this up, but the only people that can possibly listen to Chris's stream are bats and obviously infants. Everyone else. that's that's that's how quiet your stream is. Chris Mr I Have perfect hearing I've never been to a concert in my life I've never had headphones on way too loud before.

Is that where you want to go? Chris I'm an infant? No, but serious I don't know what's going on like all my volume is maxed out I wonder if there's a way I could fix this? Hang on. let me just check my sound panel. Let me just hang on when second. I'll see if I can fix some stuff.

freaking Chris change sound card settings, change sounds system sounds adjust system volume adjust system volume hello Testing Testing Testing testing hello Testing Testing Testing Testing testing Uh where was a video that I could watch? What did we recently close? Is it louder? Did that get louder? Did that I need a a video of something to play Let's just test it out on the same thing. Uh, is this a video live? All right hello. Want to miss the is it louder Bloomberg not your average bird. Is it better I Don't know.

Sounds fine. just show out your computer what we do with all of our life problems. I I My system is maxed out I don't know what else to do? Um, sounds level with you now, but it also could be this: I guess we should I should have found like one of the videos that we listened to that was too quiet to know if I actually successfully fixed everything. Uh, but I'll look into it I hear your complaints and I just don't have the emotional maturity to basically say oh, I recognize you're coming to me with a criticism I'll do my best to improve it in the future I appreciate you trying to elevate not only myself, but the show to the next level I don't have that type of maturity obviously when I hear something that has a negative tinge to it I have to lash out like a child because I'm a content creator I'm an attention I wasn't given enough attention as a child and here I am now I wish Chris I had the emotional maturity to thank you for trying to bring me to the next level.

but I can't do that. Uh, and it's probably because I was peeing the bed until I was 16 or something but whatever. Side note: Five things to know before the Stock Market opens today Friday October 6th Week start Hell yeah brother. Story of my life except I have a week middle and a week finish as well.

All eyes on jobs. Came in a little bit too hot, a little bit too good and now the market is going down. Streaming Slam Dunk! What the future of media could well depend on the NBA Cnbc's Alex Sherman reports the League's rights deals with Disney which owns ESPN and ABC and the home for TNT ends for 2024 2025 season. But potential Media Partners including Google Netflix already starting a position, the SEC musk War continues I Made a quick update video on this, but if you didn't catch it, here's what it's all about.

They're not done yet. In the past, Elon and the SEC have not been the best of buddies. They're not getting invited to each other's parties and it looks like the tumultuous relationship is continuing. The SEC is mythed.

that is the very professional way to say piss the off that Elon Musk ignored a subpoena to testify last month in the agency's probe into potential Securities fraud related to the billionaire Tesla CEO's deal last year to buy Twitter now known as X so the regulator sued him to force his testimony. The SEC must have a long and bitter history. He settled a fraud probe 5 years ago over his tweet about taking Tesla private but has since unsuccessfully tried to Scuttle The settlement on Thursday must responded to the news by calling for a comprehensive overhaul of the SEC and other A agencies. I Don't think anyone disagrees with that, like at all at all at all at all.

I think everyone agrees that the SEC when ever given any opportunity, messes up. It's like we're in. We're just talking about the NBA so we'll use a sports analogy for all you fans who are I guess fans of basket. Hoops Uh, it's like every single time you throw them the ball to do the easiest of a layup, they just punt it into a completely different building.

They just drop the ball and they ye it as full far as they possibly can. That's what the SEC does with anything. anything, anything, anything. Gary Gendler, in my humble opinion, is an absolute disgrace who is putting his own political future ahead of really the regulations meant to protect all of us.

It blows my mind. blows my mind. So I Don't think when must this isn't a hot take I Mean this is just a realistic base take that. everyone's all like, oh dude, we're already.

we're already there with you. We already agree with you on that one. Uh, grinding gears, the UAW GM shares fell. Thursday Yeah, so this strike is still going on.

There is a new strike with the kimer or Kaiser Permanente Permanente the hospital group. They're striking now. Hey, but the SAG writing strike? That's over and it looks like the acting strike might get a little bit closer to being done than not. But anyway, um, so those are apparently the five things you should know about today.

We have about 10 minutes. Uh, we cut this. We did this. Speaking of Elon Musk let's talk about Tesla I Have a pretty important update for you: Tesla Cuts Model 3 and Model Y prices in the US After car deliveries fall so recently, the delivery numbers were not what Wall Street expected I Find that to be a little bit strange because in the most recent earnings call and the most recent earnings report, they said hey, we have a lot of factory maintenance to do so.

expect the next reporting of vehicle production and deliveries to be lower Wall Street Lowered their prod like their expectations but they were still kind of high. and then there were other just individual analysts like just random people like you and me who ran the numbers and were way way more accurate. So I think this is a particular case where once again Wall Street is kind of misunderstanding Tesla But once again, these are my opinions and honestly I would say from a quantitative standpoint, a statistical standpoint, there's a lot of individual people covering Tesla who are much more on the ball. But anyway, after that Tesla took a little bit of a hit and now they've decided to make uh, cuts to the Model 3 and the Model Y.

Tesla cut the price of some Model 3 and Model Y versions in the US after the company reported third quarter deliveries that Miss Market Expectations Once again, it depends on Whose expectations you're referring to. The starting price for the Model 3 is listed at just below 39,000 on Tesla's website, down from 40,000 the latest round of price Cuts comes just days after Tesla Reported third quarter deliveries of 435,000 vehicles missing analyst expectations and marking a decline from the previous quarter. Once again, analysts, they're not the end all. Beall They're as right as they are wrong.

and there were individual people I saw it myself on Twitter SLX that were far far more accurate with their predictions. Tesla Cut the price of some Model 3 and Model Y versions in the US after the company reported third quarter deliveries, that Miss Market Expectations obviously listed just below 39, coming down from 40. the model 3 fell from 47,000 down to just below 46 and the Model 3 Performance fell from just below 51. Uh, well, it's at just below 51 now, but it's coming down from just above 53 and the Model Y performance now starts at 52.5 coming down from 54.5 so slight decreases of across the board.

If you are looking to get in a Tesla hey might be a solid time I'm not a person is like particularly following uh, what's going on exactly in the car market? The used car market Yes. I'll see it in the inflation report. I Know that used vehicles are coming down quite a bit after they inflated it, were inflating quite a bit. Um, so maybe an interesting thing.

The most recent thing that really jumps out in my mind is when you count the current I Guess like going green subsidies and tax credits, you can actually get a brand new Tesla Right now for cheaper than you can get a brand new Camry Kind of interesting. Uh. Tesla Put put the fall down on the two Factory upgrades which caused manufacturing sites to have downtime. Once again, it was not a surprise.

we knew this was coming in entire quarter in advance. Elon Musk CEO of Tesla has made no secrets of the car makers desires to chase higher volumes over bigger margins this year. So far that has paid dividends for the stock which shares up over 100% this year. Tesla is still looking to deliver 1.8 million Vehicles this year.

In my opinion, in the long term, Tesla's going to be a massive winner. It's already been a massive winner over the past two decades, but right now, yes, there's going to be a lot of volatility in it. There's going to be spikes to the upside spikes. To the downside, you could choose to try to play that you could choose to just invest.

You could choose to do a combination of the two. but in the long term I Personally am a big fan of just sitting on Tesla shares. I mean just what's going on the growth in China The growth in their gigafactories are continuing to open more. They're optimizing them.

we have Robo Taxi networks. We have just autonomous development itself I Think there's too much growth potential. Of course, there is always going to be risk potential. There's always risk, but that's the relative comparison.

It's growth versus risk. And when I growth. Well, the potential of both the growth potential versus the risk potential. I Think the growth potential in the long term greatly outweighs the risk potential.

So for me, I'm going to be bullish on Tesla in the long term unless something dramatically changes. But I mean the estimates right now is like Robo taxi Network They think that that might be so great. so Grand that it actually overshadows completely the automaking aspect of Tesla That's how big a robo taxi Network could be. and that's just one of the Avenues that is really a place where Tesla could absolutely crush it.

So those are obviously my thoughts. I Would love to get your thoughts on the whole situation, but yeah, in the short term there's going to be some craziness. there's going to be some volatility, And then that's when you have to ask yourself, are you a Trader or you an investor or you you're going to be a mixture of the two and then just be real with yourself of what you are and then you'll have in my opinion, a better idea of what to apply to the current situation. Little bit on Ken Griffin but I'll cover that later.

but anyway, he's crushing it even though a lot of people aren't. Uh Welcome to Hell This is last week's newsletter. I'm going to be coming out with another newsletter either tomorrow Saturday or the next day Sunday But I give out a Weekly Newsletter it's free Mc. Locals.com uh breakdown of the previous week when I'm looking to the upcoming week, the upcoming week's major macroeconomic reports, all the earnings right now we not in earning season so this is pretty sparse.

and then I give out the upcoming seasonality for every single uh, trading day and surprise surprise right now as the market is getting absolutely crushed. the seasonal bias for today Friday Buying at open selling at close, the Bulls have only won just over a third of the time today. From a seasonality standpoint, it greatly favors the Bears. That's not me saying oh, today has to be a bearish day.

No, that this is the market. It's a game of odds you play. When The deck is stacked in your favor. or even if you're playing when the deck's not stacked in your favor, you want to make sure when you win that it's kind of like an outsized return relative to the times you lose.

There's a various ways you can look at it, but anyway, from a seasonal influence, today does favor the Bears It's not a guarantee. I just want to give you the breakdown. Uh, then I do a review of the options, the zero DTE signal, and then the charts of interest for the upcoming week I covered this in more detail in the Sunday stream. We've been starting a series where I do a stream on Sunday Roughly midday, we just the up like instead of the Daily News it's more of the weekly news of like this is what I'm looking for the upcoming week.

Um, just going over some charts I answer your question so I'll be doing that Sunday and then I just give like other important pieces of information that um I think everyone should be privy to. but anyway, you could get it for free. It's in the description of the video macor locals.com you can sign up I think the newsletter is already up to like just under 7,000 people? Um so I hope they like it and if if you don't I don't know I I guess I'm sorry and I'll I'll do better next time around but I don't know, we'll see uh speaking. Whoa, look at that bounce back.

Uh, speaking of positions and whatnot, Uh, I'm in more of the degenerate zero DTE premium selling strategy I've been learning some things and I want to let everyone know where this is at right now? So obviously this isn't updated. but yesterday I came to the realization that there is a lot of whip risk. There's a lot of tail risk when you're doing zero. DTE So what happened yesterday? can I Actually how do you see your orders? Uh, add widget orders orders filled.

These are the ones from yesterday and as you could see there, I Did a lot of trading beyond the point of uh, hide this column, hide this column, Hide this column. Hide this column, Hide this column, hide this column. Um I did a a lot of trading after the stream and if you look at the time, you're going to notice a lot of them were past 12:00 p.m. ET past 1 p.m.

ET when I was selling Zer DTE Uh, premium. Not generally the smartest thing to do and even though the account this time around with I'm basically I funded this strategy that I'm working on with 30k at one point I was up about 200 bucks and by the time it all ended I didn't realize that we will cut your position um, from you at the end of the day at like 3:30 right here these 328 328 uh, this was forced upon me by Weeble So I'm just better learning the game and I'm not even really complaining because it was a profitable trade. I mean I I got in and I sold the premium and when I had to buy it back when they forced me to buy it back I bought it back for cheaper. So these were winning trades, but I wasn't able to hold it to exactly the point that I wanted to.

So my point being is I like the Zero DT strategy but I think it should only be fired off before 10:30 in the morning. Uh, as in I shouldn't be yoloing into these positions past noon past 1 p.m. there's just too much tail risk. There's too much whip risk.

Um, so lesson learned there. and I think I've found another way to kind of smooth out the equity curve, basically improve the sharp ratio and what I'm going to do with that is when I place the trade. I'm not only going to do it on the Zero DTE but I'm going to do it on the 5 DTE and I think there's going to be a a better risk management of that. So when it happens today in real time, I'll be explaining it to you.

Um, so yesterday when I thought of that 5dt I already engage in that. So right here. uh October 23rd. So I place one for 5 days out already and I'll be able to cover this in