My job is done...last market update for now

Summary

Highlights

• Sensed interesting market dynamics when channel began. 🔮
• Discusses past predictions and their realizations. 📅
• Explains complex impact of tariffs announced by the US. 🌐
• Presents extreme scenarios and their potential market impacts. 🎢
• Encourages cautious optimism and careful market monitoring. 👀

Key Takeaways

• Started channel sensing a market crisis due to geopolitical and political issues. 📉
• Predicted downturns have occurred; tariffs and Fed actions are pivotal. 🏦
• Final update encourages cautious market re-entry. 🚀
• Focus shifts to monitoring geopolitical changes and careful stock selection. 🔍
• Acknowledges market corrections; advises slow buying strategy. 🛒

Overview

Chapters

• 00:00 - 01:00: Introduction and Background The chapter titled 'Introduction and Background' provides an overview of the inception of a YouTube channel focused on financial market analysis. The channel began on November 15th, with content covering causes of market crises and providing market updates in late November and mid-December. The motivation for starting the channel was a perceived upcoming interesting market climate, potentially influenced by geopolitical tensions, high consumer price index (CPI), limited Federal Reserve policy options, and potential political turbulence, particularly with Donald Trump's political activities.
• 01:00 - 02:00: Market Predictions and Videos Recap The chapter titled 'Market Predictions and Videos Recap' provides a historical overview of the author's perspective on market trends, drawing from their previous video content. They predicted a significant market downturn, referencing a specific video titled 'Recession Might Really Be Coming' uploaded on December 12th. On January 15th, the author uploaded another video expressing their incredulity at the market's rise, labeling it the 'dumbest market ever.' This chapter encapsulates the inconsistencies and unexpected movements within the market as perceived by the author over time.
• 02:00 - 04:00: Recent Tariff Changes and Their Impact The chapter titled 'Recent Tariff Changes and Their Impact' seems to focus on market predictions related to potential tariff changes, warnings given in February about the market's future based on actions by Trump and the Federal Reserve, and the importance of cautious behavior in uncertain market conditions. The speaker discusses their actions such as uploading videos to alert viewers about possible market scenarios and providing updates over the past month on these developments.
• 04:00 - 08:00: Extreme Scenarios for Market Outcomes This chapter provides a compilation of market update videos focusing on predicting market downturns. The author has been forecasting a decline in the market since the previous year and offers insights into interpreting macroeconomic data. The chapter serves as a learning tool for analyzing market trends and understanding extreme scenarios that can impact market outcomes.
• 08:00 - 11:00: Mixed Scenario and Current Valuation The chapter discusses the market situation over the past week, noting that not much meaningful data has been released. Attention has been focused on the tariffs announced by Trump, which include a 10% tariff on all U.S. imports and higher tariffs on goods from about 60 countries, including China and Europe.
• 11:00 - 14:00: Investment Strategy Moving Forward In the chapter 'Investment Strategy Moving Forward,' the focus is on the recent changes in international tariff rates and how these changes impact investment decisions. The chapter discusses the baseline tariff of 10% that was uniformly applied, with additional tariffs on countries such as Mexico and Canada. It provides a detailed update on the new tariffs imposed on various countries over the past week, including 31% on Switzerland, 36% on Thailand, 25% on South Korea, 26% on India, 24% on Japan, 46% on Vietnam, and 20% on other nations. The discussion highlights the strategic considerations needed for aligning investment strategies with these evolving trade policies.

My job is done...last market update for now Transcription

• 00:00 - 00:30 i started this YouTube channel on November 15th and started talking about what causes a market crisis and general market updates from late November and mid December part of the reason I started this YouTube channel was because I somewhat sensed another interesting market environment coming whether it's caused by geopolitical issues excessive CPI which gives limited options for the Federal Reserve or just plain political issues which may be incurred given Donald Trump is starting his second not
• 00:30 - 01:00 first second term as the president of the United States now I just want to give you a quick history of how my thoughts on the market evolved by giving you a recap on the videos I uploaded i sense that the market will be experiencing a meaningful downturn as I mentioned in my recession might really be coming video which I uploaded on December 12th and on January 15th I uploaded a video saying this is the dumbest market I've ever seen given the market was rising at the start of the
• 01:00 - 01:30 year not knowing what may come then on February 15th I uploaded a video saying "Watch out this will happen in the market," giving three scenarios which may happen in the market which mainly involves how Trump and the Federal Reserve will set the tone of the market afterwards I uploaded a series of market update videos in the past month saying that we should all be careful with our actions given the market may act against our will by the way I'll upload a long
• 01:30 - 02:00 compilation version of my market update videos for some of you who might want to watch the videos in one go if you watch the videos you'll get a good sense of how I predicted the market to go down since late last year and this will be a very good tool for you to learn how to read the macro data and how to analyze them okay so looking at the market I had to upload another video today because there's just been too much happening in the market and I wanted to just kind of
• 02:00 - 02:30 reassess the views we had on the market and see where we are headed okay over the course of last week not much meaningful data came out and even if they came out no one really cared about them because everyone was so focused on a single word tariff and as I mentioned in my previous market update video on Liberation Day Trump announced a 10% tariff on all imports into the United States and higher tariffs on goods from around 60 countries including China and European
• 02:30 - 03:00 Union the baseline tariff was 10% for all the countries and for Mexico and Canada the 25% tariff also was imposed which went into effect okay so a lot has changed over the last week so let's just recap the tariff rates for the key countries 31% on Switzerland 36% on Thailand 25% on South Korea 26% on India 24% on Japan 46% on Vietnam 20% on
• 03:00 - 03:30 European Union and 104% on China okay for those of you who don't know how the 104% came about it's basically the initial 10% tariff imposed on China over fentinil concerns in February followed by another 10% extra imposed in March plus another 34% imposed around liberation day and another 50% imposed as a retaliatory measure against China's
• 03:30 - 04:00 retaliation against US goods okay so factual stuff are all over the news so I won't go into further details again let's focus on what's important implications and predictions last week I noted that based on research data the Liberation Day tariff announcement could boost PCE prices by 1 to 1.5 percentage point this year which would most likely be realized in the middle of the year so basically from the current inflation of 2.5 to 3%
• 04:00 - 04:30 inflation can even increase more to around 3.5 to 4.5% level which will even be more catastrophic to not only the US but also to the world but over the course of last week with the newly announced tariff measures I'm not even sure whether the impact on inflation can be calculated anymore these nonsense numbers are just making predictions meaningless and because it is meaningless I feel like economists have now given up on making any hard
• 04:30 - 05:00 predictions on what will happen but what happened already happened so let's try to go over the current environment number one inflation is now super vulnerable even if the short-term inflation goes down if the current tariff plans are implemented CPI in the second half will rebound very quickly number two Federal Reserve is getting busy current prediction is skewing towards a rate cut starting from June or even from May some analysts are now
• 05:00 - 05:30 expecting around four rate cuts within the year number three market is down quite a lot within the range of 20 to 25% forward price to earnings ratio of big tech stocks with decent earnings are now in the range of 20 to 25 times versus 30 to 35 times a few months ago okay having that said let's try to see what may happen moving forward first let's try to get a sense of the best case scenario and the worst case scenario this would be the best
• 05:30 - 06:00 case scenario that may happen in the market number one starting with Japan and South Korea multiple countries follow the two countries in settling tariff terms with the US somehow all countries reach an agreement on a tariff rate which effectively adjust their export pricing to the extent it just reaches a similar level as adjusting their FX rate to a few years ago number two China gets isolated and the US has
• 06:00 - 06:30 strengthened its relationships with all other nations and China has no choice but to strike a deal with the US number three while this tariff settlement is ongoing in order to keep the economy afloat during the chaotic times the Federal Reserve starts cutting the interest rate from May and achieves around four rate cuts within the year number four during the chaotic times US consumers significantly reduces their spending to prepare for a recession and CPI data gradually comes down to 2%
• 06:30 - 07:00 level justifying the Federal Reserve rate cut okay under this scenario there are multiple sources which can push the market up and up and up remember that I told you that investors are always focused on forwardlooking and moves a few steps ahead under this base case scenario every time each country reaches a settlement of the tariff market will go up and every time the Fed cuts the rate the market will go up and as the CPI data comes down the market will move
• 07:00 - 07:30 up as a result this base case scenario can trigger a new bull market okay next let's look at the worst case scenario number one China and the US continues to fight over tariff continuing to take retaliatory actions and other countries also follow China's lead fighting against the US which delays any settlement of the tariff number two the US is short of allies to purchase newly issued US Treasury bonds and US's funding capability gets significantly
• 07:30 - 08:00 reduced countries like Japan and South Korea may still purchase US bonds to maintain their relationships but it'll not be enough number three the Federal Reserve will decrease the interest rate significantly to save the economy but it'll only heighten the inflation level across the nation which accelerates the stackflationary situation number four China really goes to the extreme path and starts selling US treasuries in the market this will
• 08:00 - 08:30 effectively cause a collapse of the dollar and the US monetary system which may really evolve into something which may make the US even consider taking some sort of physical actions involving its military okay what do you think please keep in mind that the two scenarios I laid out are really and I mean really extreme scenarios do you now get a sense of how uncertain
• 08:30 - 09:00 the current situation is both are very extreme cases but not impossible scenarios based on what's been going on in recent weeks okay but we do need to take actions accordingly so let's see what would be some smart ways to take actions in accordance with the current environment now if you were to come up with a mix of two scenarios which may be more reasonable one scenario which may happen is this number one some countries which must do trades with the US to protect their GDP it might not be China
• 09:00 - 09:30 and some other nations which continues to retaliate against the US but some countries like South Korea and Japan may negotiate terms with the US number two the US will somehow squeeze its newly issued bonds down the throat of its ally nations which play along with the US by potentially offering better trade terms down the road number three like in both scenarios the Federal Reserve will prioritize saving
• 09:30 - 10:00 the country's GDP by lowering the interest rate starting from the middle of the year number four CPI will be extremely difficult to bring down especially with the interest rate going down but as the overall GDP growth of the US slowing down with the tariff situation consumer confidence also continues to decline keeping the CPI stable at current level okay so this is a random scenario which kind of mixes the best and the worst scenario here and there but however I
• 10:00 - 10:30 try to mix the two I seem to reach a same conclusion basically geopolitical impact on the market in the midterm down the road is most likely neutral to negative especially assuming that the Fed is going to lower the interest rate quite actively now geopolitical and political things aside valuation has come down a lot as I mentioned previously valuation of large global tech companies have come down by around 25 to 30% or for some
• 10:30 - 11:00 even more than that non- tech companies valuation have also come down quite a bit which makes their valuation quite attractive now for those of you who have been listening to me and watching my videos over the past few months I'm sure you have been sitting on the sideline with cash monitoring the market wondering what you should do now my view is that considering the attractive valuation we should carefully monitor the market and always be prepared to enter the market whenever
• 11:00 - 11:30 the geopolitical issues shows any signs of positive development if circumstances allow I think even slowly and I mean very slowly buying into the market in peace meal from now would also be a good strategy to think about at this point obviously you will have to pick the right stocks in order to get a sense of the stocks to pick please refer to my stock investment strategy for everyone video and try to focus on type B and
• 11:30 - 12:00 type C stocks basically the stocks which have decent growth and decent profitability with fair to slightly higher valuation would be good stocks to buy especially if we assume that the rate cuts will take place in the next few months now on the geopolitical and political issues I don't want to make wild assumptions but I will say this generally these types of nonfunddamental noises which impact the market goes away as time goes by after the US announced a 104% tariff on China even myself started
• 12:00 - 12:30 thinking that these numbers don't mean anything anymore what difference does it make 100% 1,000% 10,000% these are all the same just some random arbitrary numbers which sound too remote to stay in the market permanently so while we do need to care about the geopolitical and political noises that are happening in the market it is time for us to focus on the fundamental valuation of companies too okay guys now I know I've been very
• 12:30 - 13:00 negative on the market since I started this YouTube channel and I've been telling you guys all throughout that we need to be careful and extra careful and even more careful so that we do not lose money i'm sure my warnings already paid off a lot for all of you guys watching the reason I gave you those warnings was because I actually thought a crash like we experienced in the past few months may happen and it actually
• 13:00 - 13:30 happened the market now corrected over 25% and I think it's about time we shift the gears a little bit and actually think about when would be an ideal time to buy into the market as I said very slow and please focus on my wording very slowly buying into the market at this point may also not be a bad idea after all which stock to buy and when to buy is your choice but I just want to make one thing clear let's now monitor the
• 13:30 - 14:00 market closely with a less negative bias and be prepared to take actions accordingly now guys with this I plan to refrain from uploading market update videos as frequently as I did in the past months i had too many messages I want to convey to you guys and I believe that my job is done for now i did my best to keep you guys from losing money during the past few months and from now on as I said please try to make your best judgment to play around with the market please refer to my previous
• 14:00 - 14:30 videos on investment strategies and I'm sure everything you need will be there i'll be uploading a fresh market update video when I feel like there are meaningful things to talk about in the meantime I'll upload some other interesting videos to share with you guys thank you guys and I wish you the best