Today as we watch the stock markets rising more and more and more underlying all of that is a real economy that is deteriorating before our very eyes the first thing I want to look at is the big shock this is important because everyone will be affected by it some positively some negatively the second thing I want to talk about is the wages, wages are up if you can believe it I'll give you more detail on that in just a second and the third is the energy crisis that continues to unfold lots to unpack there and so much more
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TOPICS AND TIMESTAMPS:
Up or Down? 0:00
INFLATION SHOCK 0:37
WAGES UP 7:58
ENERGY CRISIS 11:23
$GPS INSIGHTS
#1 WHILE MANY SUGGESTED INFLATION WOULD BE GONE, IT'S STILL HERE
#2 AVERAGE INDIVIDUALS DON'T HOW TO KEEP UP, LOSING OUT
#3 LOOK AT ITEMS THAT YOU SEE RISING THROUGH A DIFFERENT LENS.
The U.S. consumer is maxed out. They need more stimulus in order to continue this economy. And of course, stocks need their artificial boost as well. The U.S. consumer is maxed out. Consumer sentiment is down heavily. Real estate continues to increase in price right now as we see low interest rates keep this going. There is upward pressure on markets right now globally because of the inflation of the money supply. As a result, we are finding prices of just about everything being higher. Money, cash, debt is coming into the markets at this time finding its way into stocks, bonds, real estate. Social security is running out of money. Pension funds are not keeping up with inflation. Natural gas and crude oil prices are rising as well as all energy and food prices. Commodities are rising higher including oil, crude oil. Some believe there will be inflation while others suggest stagflation, and others suggest deflation. Inflation resulted in food prices rising, electricity, energy prices.
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The Money GPS is the most active, most informative channel in the financial world. Day after day, breaking down the data and making it easy to understand. This channel is not here to help build a portfolio, give stock picks, or financial advice. It's simply data that is generally not found through conventional means.
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Today as we watch the stock markets rising more and more and more underlying all of that is a real economy that is deteriorating before our very eyes the first thing I want to look at is the big shock this is important because everyone will be affected by it some positively some negatively the second thing I want to talk about is the wages, wages are up if you can believe it I'll give you more detail on that in just a second and the third is the energy crisis that continues to unfold lots to unpack there and so much more let's begin your favorite and mine Janet Yellen said that spending bills will be anti-inflationary yes if you can believe it she actually said that this will be anti-inflationary lowering important costs okay this is a video interview you can see for yourself I'll show you in just a second a clip from that but I wanted to cover some of the quotes and some of the important points speaking from Rome she insisted that what this package will do is lower some of the important costs they pay for health care for child care it's anti-inflationary in that sense as well have you seen this ever, ever, any of these things go down has your health care gone down in price over the years look back 10 years ago look back 20 years ago does that make sense to you what about child care has that gone down is it anti-inflationary this is not the only package that they have done over the last several years it's every few years this is just the newest one they're always arguing back and forth the treasury the congress who is it gonna be today okay this is just ridiculous when you look at it if you click on this links will be in the description as always you could see it for yourself okay quote I don't think that these investments will drive up inflation at all how much are they going to spend here how much are they going to push the individual into debt because that's what it is the government is essentially responsible for creating all of this and then they put it onto your back the taxpayer it will boost the economy's potential to grow the economy's supply potential which tends to push inflation down not up for many American families experiencing inflation seeing the price of gas and other things that they buy rise what this package will do is will lower some of those things okay let me know in the comment section below let's have a serious discussion here it's hard to keep a straight face when you're reading this type of news what do you think put it in the comments below if you support my idea that having these programs like this ultimately is inflationary hit that thumbs up button let me know you agree with me and if you don't put it in the comments tell me why let's talk about it okay this is really important this is part of that interview and she said I think the supply chain issues are holding our economy back somewhat it will take a while to boost supply I agree there are problems there are absolute problems today and of course that is just part just part of the situation okay just looking at like that it's not going to tell you the whole story big finance experts Q1 of 2021 there is inflation but it's transitory in Q3 okay inflation isn't transitory but there is no stagflation in the first quarter of 2022 okay there is stagflation but this time it's different and we are definitely not in the 1970s this was a funny one because probably how it's gonna be and now the big shock inflation notches a fresh 30-year high as measured by the fed's favorite gauge when you look at all of these statistics adding up day after day month after month you are seeing what's happening here it is very clear all the actions that they are taking has led us to this point on top of all of that you have these other problems of bottlenecks supply chains the truckers and all of these different things there's always these you know individuals and news outlets and so on that have their bias and they have their way of injecting no this is the only reason that's all it is I like to think of it like many things are happening all at once but underlying all of that is the activities from the fiscal and the monetary stimulus that nobody seems to want to touch and then we have Bill Ackman you remember Bill Ackman he said hell is coming and you must act you remember that and then like two days later the guy's buying anyway I gave a presentation at the New York Fed of all places and looking at last week to share our views on inflation the Fed policy the bottom line is this is his quote we think that the Fed should taper immediately and begin raising rates as soon as possible how does raising rates fix the supply chain issue supply chain issues have never been the cause of long-term inflation that's the reply we'll look at that in just a second here I personally agree with the fact that the Fed should be reacting to what they are seeing but of course they are not and of course raising rates does it fix the supply chain problems not directly not directly that's a fact but if you understand what happens and take a step back zoom out from all of this data and you see it right back from the very beginning 1913, in fact 1907 and you see the structure of this organization the Federal Reserve how it is built look around to the other central banks and you see something very different happening most of the other central banks have acknowledged that they have inflation problems today that need to be stamped out with higher rates of interest and yet the Federal Reserve not only is not doing that yet but they are suggesting it's not the case so something very strange is going on today whatever bill Ackman says to me doesn't really matter but in this case I actually agree with them that they should be taking actions right now to help people by bringing those interest rates down all the way it doesn't help individuals it doesn't help we know that they have created the most ridiculous policy long term that we have ever seen in history the biggest gambles ever in history and it has supported the buybacks really helping out all of those individuals and the insiders of these major establishments they get their payday Tim Cook got his 300 million dollar payday because of those stock buybacks that's the way this works the average retail investor doesn't sell their shares Tim Cook sells 300 million dollars that's the way this works I'm going to get into that more in another video let's talk about this in the Money GPS Insights while many have suggested that inflation would be gone by now in fact by the end of summer it's still here average individuals don't know how to keep up with this and in fact over a period of time they lose out everybody should be looking at these items that are rising in price through a different lens we can make a difference here if we buy at the day's prices instead of waiting until six months or a year from now we can look at different things that are rising and see those as investments not just as liabilities and I could go on and on okay so let's dig in here US wages jumped by the most in records dating back 20 years you could see wages and salaries private versus government workers year over year change the blue line is private and the government workers is the red and you could see that right there and when I look at this you can see specifically that the private workers declined even more government has gone up all right breaking it down a little bit further where is all the money coming from government transfer payments as a percentage of the total income so all of the total if you took all of the total income in the united states right now today it is at approximately 19% of the total income is from the government think about how crazy that is at the peak of the crisis it was I think 33%-34% and now it has come down but you can see the trend okay I think it's pretty clear to me take a look up, up, up, up, eventually the government is the only employer does that sound good to you personal savings rate has declined significantly now over time of course we could see what has happened here all right looking at all through these years after the financial crisis pretty much flatlined you see this spike up during this period 2020 why because the government gave out the money now that has come down what does this mean when you have less savings number one that we have a lot of money that has been put in to the stock market the different investments to their house maybe they got bought a second house maybe they bought a car whatever that might be okay big ticket items also at the same time you've got people who they don't have that stimulus anymore and as a result they are depleting their savings because those checks aren't coming in okay so there's a lot going on here then we look at this this is the PCE. The Core PCE rate is the favorite measure of the Federal Reserve and you're seeing how high this has become okay you're looking at this going back into the levels we haven't seen since the 90s this is a big shock if you have seen anything in your stores at the gas station whatever it might be and you've been shocked before let me know put it down in the comments let's talk about I love the comments I'm learning so much from you oh I'm in Australia and I'm seeing this oh I'm in you know Italy and I'm seeing this I love those comments the the value in the comment section alone on this channel is is just unbelievable okay this is just a personal income month over month you could look at that declining right now and the core PCE has gone up not a good combination right and what about in Europe my friends in Europe I know I have so many viewers in Europe here you can see the core CPI and the headline CPI essentially just different measures of inflation going back to levels we haven't seen since the financial crisis it's crazy to look at how high inflation is of course you have things like this being direct directly responsible for some of that LNG demand to rise 25% to 50% by 2030 fastest growing hydrocarbon we're talking about natural gas here this is being used to heat people's homes it's being used for many different applications and of course the prices are rising considerably okay I have shown you this over the last little while this is coming out of Reuters but just looking at the fact that you have got um you know a sincere demand for this particular commodity and what happens to the price high demand supply you look at the problems they're all adding up India's top gas importer sees LNG price surge spurring long-term contracts that of course would be a good thing but the reason I mentioned this is you as the individual I have seen many comments about this and I hope everybody is aware so I want to talk about this for just one second if you can lock in your price for a period of time the longer they're gonna let you lock in that price you should do it in my opinion why because they don't look like they're stopping anytime soon if you could lock in the price ask get it done this is related to China, the Chinese coal mining companies are of course you know uh you know how do you say the sending back their lunch okay they're giving it back why because of things that have happened over the last little while you're seeing china basically go in and restrict these companies say no, no, you can't charge this much you can only charge this much because the prices had gone too high and look at what happens to these companies these companies directly or and sometimes indirectly are really falling as a result of controls that are put from the top down now we have this japan okay's plan to push clean energy nuclear to cut carbon I don't know if japan is the best place to have a nuclear plant I might have I might be remembering something that happened oh let's say 10 years ago exactly but I don't know can you remember any event I'm not sure San Francisco gas prices reach new all-time high of 475 per gallon this continues absolutely continues to go up all over the place it's not just San Francisco but of course that's one that is quite uh experiencing it to quite a degree what happens with oil prices if Cushing inventories fall to zero Cushing being such an important uh place for oil looking at the stocks that Cushing have halved since April 2020 market route storage at pushing alone has the potential to really rally the market to the moon keep an eye on this I talk about it a lot on the channel specifically with oil but watch what happens and watch the price of oil last but not least I should have put this beforehand but gas stations in many parts of china are running out of diesel after supply constraints posed by the booming demand for coal transportation and factories using diesel to generate electricity each customer can only buy a fixed amount because there isn't enough at the moment this is going on like you heard back in the 1970s and I know many of you were experiencing it at the time what do you think is going on here you know in china in India if you see it going on the UK and so on with the shortages with the price shocks the big shocks that people are seeing today are we seeing 1970s or because of all the money printing the quantitative easing and the zero percent interest rates is it even worse I think it very well could be and that's why I say for you the individual prepare for the worst and hope for the best if you want to support the channel it's pretty easy hit that thumbs up button at the same time by clicking that like button you're more likely to see these videos in the future that will be more likely to come up hit that subscribe and when you hit that little bell make sure you hit the always notify me this is really important okay because it's being more and more difficult to get into people's 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