Signs of Stagflation??

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Signs of stagflation. I handle garbage in our household. I was up bright and early this morning, every Monday, Thursday taking the garbage out. Can’t bring it out the night before. I’d have the kids do it if that was the case. We’ve got raccoons here that you could put a saddle on and ride, okay? I don’t care how many bungee cords, they’ll tear apart that damn thing. Anyway, neither here nor there. Porn.

It was pouring out this morning. Lovely. And again, it was double garbage day because Monday Memorial Day, no garbage collection. So I got soaked and I was thinking about it and thinking about the garbage that the economists and the pundits keep telling us about the economy. It’s getting things that I think about while I’m taking out the garbage. It’s like having, you know, Paul Krugman and Alan Blinder and

Joe Biden sitting under a massive umbrella or a tent while it’s pouring outside, yelling at me saying, Hey, hey, it’s not really raining outside. Everything is just great out there. Chris. No, no, no, that’s not rain. Nope. Nope. It’s sunny out. I follow the various different economic news. We go over jobs numbers here on the program. We try to dive into them and kind of read between the lines.

You want to call it, you know, reading the tea leaves? Not so much. We all can see it. We can all see it. We all know it’s there. We all know what we’re paying. There’s not a day that goes by where it doesn’t seem like you’re getting punched somewhere seeing, I just spent what? How much? And we all done it.

You’re out about it. All of a sudden you look at it, you’re like, what? How did that happen?

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And it’s what we’re dealing with at this point in time. Now that gets to phrase that is brought up from time to time. And oftentimes it brings up, you know, we’re talking about echoes of the 1970s and stagflation, which is what it is a economy that is not growing or going backwards or kind of stalled and also an inflationary environment.

There are signs of a stagflation, stagflation -esque type of environment. Again, I caution people to make comparisons to the 1970s. A different world today than it was in the 1970s, different players, other advanced economies out there that can soften economic downturns. And without a doubt, China wasn’t China.

The China of today wasn’t the China of the 1970s by any stretch. And again, it changes the dynamic. With that being said, what is the Fed going to do? I mean, I take a look at the Federal Reserve’s beige book and what they’re reporting on when it comes to discretionary spending. They have a more pessimistic outlook. The job gains really aren’t that much. Actually, the Dallas Fed Services Survey,

basically the worst we’ve had since the Great Recession. There’s a lot of warning signs out there when it comes to economy, but it’s been this way for a period of time. Again, we’ve had an economy that has been, for the most part, stuck in the mud. Now, people that might disagree and say, well, look at the stock market! Look at the stock market, look at how great the stock market is doing. Hold on.

Okay, hold on. This is again, a misunderstanding when it comes to the stock market as a whole. Let’s take a look at the run up that we’ve seen this past month. Four technology companies added more market value than the rest of the S &P 500 put together.

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Now there was some hope, there was an idea we actually talked about at the beginning of this year that the market breadth was going to improve. Not really, not really. You talk about, what is it, Apple and Microsoft, Nvidia and Alphabet Google. They added $1 .4 trillion in market capitalization this month.

That is more than the other 296 stocks that rose put together. And half of that was just Nvidia. Now I get it. I get it. You know, this is a new technology, a technology supposed to improve productivity. Okay. And there’s a lot to be said about Nvidia. Did a podcast on it this past week, a brief one. But overall,

Overall, you’re seeing many companies issuing cautionary tales moving forward. Many of them are actually gotten hit. And when they don’t make their numbers, they get smacked upside the head. So again, what does this mean overall? Again, we don’t really see it’s an election year. You’re not going to expect any sort of policy change. How in the world is Joe Biden going to change course on this, you know,

Binomics is awesome narrative that he’s been pitching. How do you change that? Agaain, I don’t even think he’s going to address it to some degree. I think it’s going to be more about having him to move on to handouts and giveaways and abortion. And that’s what he’s going to end up running on. Again, we do this to ourselves again and again and again. And it’s because of the fact that the people that we elect, we elect people that are all for bigger government.

Government intervention, government tinkering, tariffs, a myriad of things that doesn’t allow for dynamic growth. We haven’t had a really strong dynamic growth period in this country. You wanna go back to the 1990s. I’m being honest, let’s just take a look. Yeah, we’ve had some starts here and there, but let’s be honest here. When you face downturn, we face a downturn like we had during the Great Recession. We normally…

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We never explode at errors like that. We didn’t. We didn’t. We did it because of Obama’s policies and government intervention. And again, we got more of the same under Joe Biden, you know, Inflation Reduction Act, CHIPS Act, all of these things. It doesn’t allow for, it doesn’t allow for the type of growth that this country was used to for a long period of time. And again, this gives the perception out there and it’s right.

It’s not a perception, it’s reality, okay, that people feel like they’re stuck on a hamster wheel. The economy is not able to lift them up like it had in the past. And this again leads to other things and concerns that we’ve talked about here, especially with younger people, financial nihilism and decisions that people are made because they feel like that they have no way out and they can’t get ahead. Anyway, stagflation, is it here?

Are we heading towards it? I don’t know, but you know, I say there’s, when there’s smoke, there’s fire. Watchdog on wallstreet .com.