Thank you for your indulgence yesterday. I know today’s content is a day later than I would have liked, but sometimes, life happens. Today, I dive headlong into the GDP numbers revealing another quarter of negative growth. That’s two consecutive quarters of economic shrinkage and meets the definition for recession. As Rick Santelli said on his CNBC show, “It’s not good, whatever you want to call it.”
I spend a good amount of time tearing apart the “good” news the White House keeps trying to point to, like more consumer spending and more corporate spending. It’s amazing to me how these “experts” seem to think inflation and recession are mutually exclusive subjects and have no relation with one another. Of course people are spending more because of 41 year high inflation levels! And, similarly, businesses are spending more because wholesale prices are at even higher levels of inflation. It a basic formula to follow and yet this Administration and their dutiful followers in the Legacy media are oblivious to it. If you are spending more, due to inflation, but getting less, due to the cost of good/services, then of course you can have more spending while the GDP shrinks.
And since wholesale inflation is at 11.3% while the consumer price index is at 9.1%, I fully expect inflation to keep climbing for awhile. On top of that, Senator Joe Manchin has decided there is a price where his principles can be purchased. He has gone back on his stance over the Build Back Better bill and is now endorsing it under it’s new name, The Inflation Reduction Act of 2022. Folks, anytime a Democrat introduces a bill, whatever they call it, the bill is meant to achieve the exact opposite. This $700+ billion dollar bill is not only going to flood the market with more currency, causing more inflation, they are also proposing a massive tax increase on corporations. That tax bill is just going to get baked into the cost of goods, making them even more expensive.
It’s simple economics that our simpletons in Washington, D.C. do not understand and do not care to understand. They are always insulated from the carnage they cause and just move to the next disaster without a sense of remorse, shame or guilt. As much as I try to stay positive, I think it’s going to get much worse. If the Axios story on Vox Media already laying people off isn’t the dead canary in the coal mine, I don’t know what else I can tell you to convince you to start saving now and have a plan to weather the storm. It’s coming. I hope I am wrong, but I don’t think I am.
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