The Job Market Is Crashing And The Fed Must CUT BIG

0:00Hello, everyone. We've got a lot to discuss today. The jobs report this morning was very, very bad. The Fed should have been cutting rates months ago. We're now entering what I call a crazy uncle market. And Elon Musk, he just got a massive pay package at Tesla, and it could make him the world's first trillionaire. We're live today from the desk of Anthony Pompliano.

0:28Before we get into today's episode, you know what it is? Hit that subscribe button. We are currently at 20 ,729 subscribers, and I need your help to make sure that we get to my goal of 1 million. Hit the subscribe button and let's get into today's show. All right, ladies and gentlemen, the jobs report this morning is going to send shockwaves throughout the market. We saw growth slow to an extraordinary low 22 ,000 payroll additions in the month of August. That is very bad. And if that wasn't bad enough, the June jobs revision brought the June jobs number negative. That's right. Heather Long points out that the new data shows the U.S.

1:03economy lost 13 ,000 jobs in June. It's the first negative month since December of 2020, five plus years. She goes on to say that there's barely been any job growth in the past four months. Almost all the jobs added are in healthcare. Without healthcare, job growth would be negative in the past few months. That's not good either. Now, Joey Politano, he writes that U.S. blue-collar job growth has completely stagnated. It's hit the lowest level since the onset of the pandemic. Manufacturing is currently losing jobs at a rapid pace and growth in construction and transportation has slowed to a crawl.

1:36Now, interestingly, white collar jobs within US manufacturing are actually growing. That's not exactly what you would expect given the public narrative right now. Manufacturing has got blue collar jobs, but it's the white collar jobs within that sector that's growing. But manufacturing is not the only place that we're seeing the issues. Heather Long shows that the job slowdown is across the economy. In the last three months, mining has lost 13 ,000 jobs. Construction is down 10 ,000 jobs. Business professionals are down a whopping 51 ,000 jobs. And the federal government has lost 34 ,000 jobs.

2:06Finance, which is largely thought to be immune to most economic policies, has also seen zero job growth over the last 90 days. So what exactly is going on here? Well, this brings us back to what I've been talking about all year. The U.S. economy is getting smacked in the face by a massive deflationary force. The combination of tariffs and artificial intelligence are a powerful cocktail, and it's driving significant changes in the economy. This is why it has been so dangerous for the Federal Reserve to continue keeping interest rates at elevated levels. Their complete refusal to cut rates, even though the data told them to do it, has put them behind the curve once again.

2:42It's a very familiar spot for them. Today's job report essentially guarantees that we will get a rate cut in September. It also drastically increases the odds that we will see multiple rate cuts throughout the end of 2025. The U.S. economy is sprinting, but it's sprinting into a big headwind. We need the stimulus of monetary policy to generate the right kind of economic activity. Without it, the headwind will take its toll and make things much, much harder than they need to be. Now, as you all know, I'm not a big fan of human-led monetary policy, but if we're gonna use it, which we do, then the humans at the Fed should at least implement the monetary policy in a consistent and predictable way.

3:17They haven't been doing that though. Their critics claim it's for political reasons. I don't know. Their supporters claim it's because tariffs were supposed to be inflationary. I don't know about that either. Regardless of the reason, the Fed has made a big mistake and they must do their best to correct the issue. Now, I believe that we should see a large interest rate cut in September, a small 25 basis point cut, that's unlikely to do enough to put a dent in the problem. We should get a 50 basis point cut at a minimum. And there is a serious argument for the cut to be 75 or 100 basis points. Now I get it.

3:47Those are very big numbers. They're scary to some people. The market would have a hard time swallowing such a bold move. But sometimes you have to do unpopular things in order to get the Federal Reserve back on track. And these guys, they're behind the curve. Our central bankers have completely miscalculated the impact of tariffs, and they seem to have misunderstood just how pervasive artificial intelligence would be. So now the Fed should scramble to use their toolbox to get interest rates lower sooner rather than later. So this brings me to asset prices. Most assets are already trading at or near all-time high prices.

4:19S &P, NASDAQ, Dow, all all-time highs. If we get a large interest rate cut in September, asset prices will go much higher. The Fed can't worry about that though. They've got a labor problem on their hands. Truflation, real-time alternative inflation metric, is showing inflation under 2 % right now. That's a 50 % reduction in inflation since the start of the year. The Fed should have already been cutting rates and they can't go back in time now, but they can cut rates aggressively through the end of the year. And investors who are exposed to stocks, Bitcoin and gold are gonna do very well. Now we all have to sit and wait to see what Jerome Powell and his crew decide to do in light of the terrible, no-good jobs report from this morning.

4:59We're entering what I call a crazy uncle market. It's where people who own gold, Bitcoin, guns, and land, they're gonna do very well. Everyone's had the same experience at some point in their life. You sit down at dinner for Thanksgiving, Christmas, maybe it's at a family reunion. One thing leads to another, and the crazy uncle starts explaining his political views. The rant almost always ends with some sort of bold prediction that the US government's demise and a plea for everyone at the table to buy a certain asset to prepare themselves. The assets usually cover what I call the crazy uncle starter pack.

5:29They got gold, Bitcoin, guns, and land. Something to protect themselves economically. Something to protect themselves physically. And something that your uncle promises the government can't take away from them. Now, normally, you can just ignore the crazy uncle. Get a good laugh when he rants. It's pretty funny. And then you just go back to your normal life. All is good in the world. But your crazy uncle is about to look like your genius rich uncle in the coming years, in my opinion. Each of the four chosen assets are poised to do well based on various social and economic factors. We know the government is not going to stop printing money, and they're about to cut rates.

6:00So the dollar debasement will drive gold, Bitcoin, and land much higher. Gold's already up 70 % since the start of 2024. Bitcoin's up more than 300 % in the same time frame. Land? That's been compounding at 6-10 % annually for decades, depending on the geography. So this data tells us the market understands what's happening and it's already positioning itself to benefit from the increased inflation. Remember, markets are forward-looking, just like your crazy uncle is. Now you may think that my inclusion of guns is weird, so let me explain. History tells us calamities that come with moments of uncertainty lead to a repricing of small arms ammunition.

6:36Look at this graph. Ammunition prices pushed higher following the 2008 crisis and the 2020 pandemic. My guess is that the path that we are on is going to only increase the likelihood that guns and ammunition go higher as well. Again, I know it may sound crazy. That's why your uncle sounds crazy all the time. But I truly believe that we're entering a crazy uncle market and those holding gold, Bitcoin, guns, and land, they're gonna be very happy campers in a few years. All right, we gotta talk about Elon Musk's brand new pay package from Tesla. They are offering him an incentive package that is worth up to$1 trillion.

7:14That's trillion with a big capital T. This would make Elon Musk the first trillionaire. Now, before you go freak out, and if you're a critic and you hate on this, it's an incentive package. He has to do insane things with this company in order to earn$1 from it. There's no guarantee. If he doesn't perform, he gets zero. That's true skin in the game. Now, what exactly is in this incentive package? Well, here's a couple of things. He's got to hit$400 billion in adjusted EBITDA, deploy 1 million robo-taxis for commercial use. He's got to ship out 1 million energy storage units, produce and deliver 20 million vehicles, secure 1 million ongoing full self-driving subscriptions, aim for$8.5 trillion of market capitalization, commit to at least 10 years in the CEO role, and the package includes 12 % of company stock divided into 12 different segments if he can hit these incentives.

8:06The additional shares that Musk could receive will push his stake to at least 25%. That'd be a big deal. He finally would have a bigger stake, which is what he's been going after. Now, on top of that, he would not be able to actually sell this stake for a number of years as well. So yes, he's got a massive incentive-driven pay package, but maybe every CEO in America should have the same thing. Rather than them simply just get paid for doing nothing, what if we actually said, you can make a lot of money, but it's only if you deliver for shareholders? because Elon Musk can make Tesla into an$8.5 trillion company.

8:43Do you know how many police officers, firemen, teachers, pension funds, and everyday Americans are going to make a killing alongside him? See, that's the thing is these public companies, American citizens own them. And as these companies grow in value, it is creating wealth for thousands, tens of thousands, sometimes hundreds of thousands of people. And so if you can create trillions of dollars of value, For other people, maybe it's not so crazy that you yourself would get$1 trillion. And that's what this incentive pay package does, is it dangles a carrot in front of Elon Musk. If you think you're the world's greatest entrepreneur, the greatest entrepreneur of our generation, perform for shareholders, and then we'll give you a massive payout.

9:26That's it for today's show. Please remember, we have 20 ,729 subscribers. I obsess over this. I know the number every single day. I need you to subscribe so that we can get to my goal of 1 million. Hit the button right now, and I'll see you guys live from the desk of Anthony Pompliano on Monday.