Latest / Financial Survival Network / How The Recent PPI Increase Could Skyrocket Inflation And Why You Can't Trust Economic Stats -- Ed Siddell #6026

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How The Recent PPI Increase Could Skyrocket Inflation And Why You Can't Trust Economic Stats -- Ed Siddell #6026 · Financial Survival Network

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  You know, the increase to the PPI. We were saying all along,
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  it's going to be higher because you know, it's the increases not because of
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  actual growth in the economy, but it's just inflationary costs. And you could
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  see that, you know, with the core PPI. I mean, that
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  just kind of solved the riddle. If you will, you're listening to Carrie
• 0:18
  Letz's Financial Survival Network, where you get valuable information you just can't find anywhere
• 0:23
  else to thrive in today's trying times. You need the Financial Survival Network now
• 0:30
  more than ever. Go to Financial Survivalnetwork dot com and get your free newsletter
• 0:35
  and gift. Financial Survival Network now more than ever, And welcome you are
• 0:45
  listening to watching the Financial Survival Network. I'm your host, Carrie Letz.
• 0:50
  Hey, we're almost at mid March here. In fact, we are at
• 0:53
  mid March. You were taken day. We just got exciting news on the
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  PPI increase, and what a shocker. Turns out inflation is not so transitory.
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  What is transitory? Is there sound bites and their explanations as to why
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  inflation is transitory? But ed Sidell is here with us to to explore and
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  understand exactly what's going on here. Ed great to have you back on the
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  show. So no surprise for avam me. Hey, of course, no
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  surprises on this pp I number, is there? No, no, anybody
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  who was acting shocked, just you know, they're not paying attention. You
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  know, the the increase to the PPI, we were saying all along,
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  it's going to be higher because you know it's the the increase is not because
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  of actual growth in the economy, but it's just inflationary costs. And you
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  could see that, you know, with the core PPI. I mean that
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  that just kind of solved the riddle if you will. Oh yeah, hey,
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  so looking at this thing, excuse me, sure, sure, looking
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  at the numbers here and everything else. You know, look, airline pilots,
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  they've gotten forty to sixty percent increases, light attendance forty sixty percent increases.
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  I know they don't theoretically produce anything, but clearly, clearly prices are
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  going up. Yeah, you know, I mean it's it's that old minimum
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  wage argument, right, I mean, we have to continue to raise the
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  minimum wage so people can you know, survive and you know, have increase
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  their standard living. But you know that affects everything all the way across the
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  board, and that holds true. So we're talking about you know, airline,
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  the pilots and flight attendants, you know, as it relates to transportation,
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  and then you know, when we look at the teamsters, you know,
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  all of these things, you know, as wages increase. This is
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  all inflation and this is really what's affecting the PPI. And honestly, Carrie,
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  I'm shocked. I'm shocked when I just heard today that you know,
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  they were within the Fed's target of that two percent, which is arbitrary.
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  But that's topic for another day. But it's just like the jobs numbers,
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  you know, they they inflate them and then they revise them down the words.
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  You know, you've got pal who wants to, you know, have
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  unemployment up. And everyone's relating to what we're seeing right now. Very similar
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  to to two thousand and eight, you know, but there's some major differences
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  when we talk about inflation. You know, number one, unemployment, right
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  it was in I think it was it was in the seventh I would say
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  seven point three. I can't remember exactly what it was in two thousand and
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  eight, and now it's in the threes. But you know, the big
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  difference is the underemployed. You know, if we had in that under employed
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  number, it's you know significant under unemployment is actually significantly higher now than it
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  was in eight. But the big factor is inflation. And so you know,
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  when the Feds are it seems like that old adage, right, there's
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  lies, there's damn lies, and there's statistics. So so everyone's kind of
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  adding in the numbers that they want to be able to prove their point instead
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  of looking at the overall picture. And if you look at the overall picture,
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  the math it just you know, it continues not to work. Yeah,
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  exactly, And who do they think they're kidding? That's what I'd like
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  to know. But obviously they think you're kid. They're kidding you and me,
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  right, yeah, And you know, I I was just sitting the
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  other day that the disparity between the haves and the have nots, or you
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  know, the Main Street and Wall Street, that gap is getting bigger and
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  bigger. I was just looking at a survey they came out. It said
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  that the loans all four one case, they have increased thirty percent and and
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  the meaner for the in the survey, there was the top five things,
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  right, but the top two. The number one reason people have been taking
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  out loans on four to one k's was to prevent foreclosure, right. The
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  number two was to cover medical bills so that they could maintain treatment. And
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  so this goes back to you know the stats that came out last October that
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  said that forty nine percent of Americans at the end of every month there's not
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  enough money, so they're living on credit cards, and you know, we're
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  we hit all time debt highs as far as credit cards, I think now
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  the average credit card rate is over twenty four percent. I think it's like
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  twenty four point six percent now average, right, So some are hires someone
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  a little bit lower, but that's the average. And the average household dead
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  is over one hundred and fifty thousand dollars. So when people talk about,
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  you know, the economy is strong and you know the PPI numbers, you're
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  really have to look at what's really going on in the world around us that
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  say, yeah, you know that's it's not accurate. Definitely not accurate.
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  And we know this for sure. We see that, you know, personal
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  income is lagging debt in the GDP numbers, right, significant yeah, by
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  a long shot. How long can that go on for? Man? I
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  you know what, I think we're pretty close to that breaking point. You
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  know, we talked about this last year. You know, I've been talking
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  about this debt bubble. We're ads we're so close to a point where,
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  you know, at what point is no longer sustainable. I heard today one
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  of the pundits on on one of the financial shows saying that I don't mean
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  to be a permable, but if you look at all the numbers, this
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  bull market is not, you know, going to end any time in the
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  near future. I think people are looking at what's going on in the market
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  as far differently than what's going on or as the same as what's going on
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  in real life. There are so many family struggling there is they're going to
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  hit that wall. And we saw this in seven and o eight going into
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  nine, where when people start hitting the wall, which means they have no
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  money, they know that they're going to file for bankruptcy or whatever it is.
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  They continue to run up, you know, their debt, whether it's
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  a home equity, line of credits or credit guards or or whatever it is.
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  And I think the way that it's going right now, based on the
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  data that I'm seeing, it's very similar to what we saw in eight.
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  And you know, again that narrow window we have, I think it's it's
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  closing rapidly. You know, who knows whether it's the summer or next fall,
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  but it's, uh, it's closing, definitely closing. And like we
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  say, how how how much longer can it really happen? Yeah? And
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  you know, I continue to to look at all of the numbers because you
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  did. There's so much conflicting data, you know, there's so much white
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  noise. You know, when we're talking with clients, you know, educating
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  them and helping them understand that. You know, last year the biggest rise
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  you know, in the indices was based on the Super seven, Magnificent seven,
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  whatever you want to call it. And then it was, you know,
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  the Fabulous four. And when we're looking at it this year, it's
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  it's it's really three companies you've got in video. I think yesterday it hits
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  well into the nines, nine hundred dollars per share, and you've got Meta
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  and Amazon that are really propping everything up. And and so now when you
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  start to see this, you fork feeling, oh my gosh, I'm going
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  to miss out. And you know, hey, if you have any cash
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  shitting on the sidelines, now is the time to get in before you miss
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  out. Uh. You know that's when you start really pulling back. That's
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  when you really start need to be a contrarian saying, you know what,
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  there's something else, bigger afoot. I don't think between now and the election,
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  barring some unforeseen incidents. You know that's quote unquote black swan event,
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  whether it's China, Taiwan, god forbid, a Gazza type incident. Here
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  in the US banking collapse, I mean ranking collapse. You just read my
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  notes, Yes, because we're starting to see those right banking commercial loans.
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  I saw report Monday or Tuesday this week and it said nearly ten of all
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  commercial loans are either past thirty days or have engaged into some special servicing agreement
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  with the lenders. Me think about that, I mean, those are that
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  that's a big number. So you know, you've got all of the these
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  loans that are coming due, and now with as that credit continues to tighten,
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  you know, these borrowers they're not going to be able to qualify like
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  they did and so they're gonna have to pay a higher rate. And now
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  with the majority of these loans where they're my mind just went black, where
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  you know, they they're not on the hook anymore. They could just walk
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  away and be free and clear. I you know, I think we're gonna
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  start seeing more and more of that, and that's gonna the dominoes will continue
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  to fall off. Yeah, and the dominoes are falling now, right,
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  So again, how much longer can it really continue? You know, I
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  don't know. I think it's going to be short lived. A recourse That's
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  what I was talking about. So you know, these recourse and no recourse
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  loans where they don't have to go after them, and and I think as
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  these I mean, we just saw with black Rock, right, black Rock,
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  they had a couple of non recourse loans on the buildings and they walked
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  away. Some of the world's largest reachs, I mean, they're everyone.
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  So these are the top of the food chain and they're walking away from their
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  obligations. So imagine what Main Street is is going to start doing. Yeah,
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  I can't even begin to think here. It's It's scary, isn't it
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  It is? It is, And I don't you know, I try to
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  look at you know, not glass half full or half empty. I'm you
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  know, I'm just always happy to just have a glass, right. And
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  if we look at this the right way, with all the bad news that's
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  coming out, if your positioned properly, you know, when when things kind
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  of flip upside down, as they always do because it's cyclical, you know,
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  there there's an opportunity to do well. But my fear is so many
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  people have been talked into we got to get all the way and let's go
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  all into the market right now. And I think there's going to be a
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  huge shift in wealth, or a continual shift in wealth, I should say.
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  All right, So, hey, when Powell was giving his speech to
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  Congress, you also mentioned that there were going to be more bank failures.
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  Did you catch that I did? I did, Yes, yep. So
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  when on of it, if he's even saying it, then we got a
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  problem uston. Well, absolutely, And you know Jamie Diamond originally said we're
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  fine, there's nothing to worry about, and he came out at the end
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  of last year and said he's concerned and brought it up in January of this
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  year when Pale says it if you there's a couple of rating services that actually
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  rate banks. I mean, you can win. And you look at the
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  number of banks that have a uh C D or E ratings. They don't
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  have an f right, it's C D or E. It is significantly higher
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  than it was a year ago, and it's more than double than it was,
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  you know, even three years ago. So that's telling the dark side
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  of the story where everything is continuing to head in the fact that Pale actually
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  said it on Ryan with t Television there, Yeah, that don't know it's
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  coming down the pipe, right, because he wouldn't even admit to inflation.
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  Everything was transitory until he's like, oh wait a minute, I got to
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  back out of it. So that that kind of tells that's a sign of
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  things to come. And now he's saying you shouldn't be demonizing Trump enthusiasts or
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  Trump supporters too. I mean, it's a little strange, isn't it.
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  Yeah, you know, I didn't. I'm still trying to figure that out.
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  Is he saying that because hey, I need to make sure I want
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  to keep my job and he thinks that, you know, the election is
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  going to go one way versus the other. Because I thought that that was
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  so misplaced. I just thought that that was a very odd comment to me,
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  didn't you. Yeah, he hasn't exactly been a friend of the Republican
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  Party. And we're not talking politics here, I'm just saying, what does
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  it mean? And I guess he sees the handwriting on the wall, doesn't
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  he. Yeah, yeah, I mean, without a doubt. And I
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  think a lot of people are truly getting fed up with the lip service,
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  and you know, because they're feeling the pain every day every time they get
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  their check. It's not enough. And you know, healthcare costs are going
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  up. I mean, look at the cost of insurance. Did you see
• 14:22
  that auto insurance again? Another quarter in a row. Car insurance? Tell
• 14:26
  me about it. I know, I just got my bill, and you
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  know, I have the most expensive car there is to ensure, and I'm
• 14:35
  in the most expensive state for car insurance, Florida. And man, it's
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  like, it's crazy, But what are you supposed to do lower year?
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  Well, you got the doubletals. Yeah, you got the double whammy with
• 14:48
  Hololners insurance going through the roof down there, you know, And this is
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  this is telling us when you start seeing howners insurance and car insurance. You
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  know that property and can the go up as high as it is? You
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  know, there's what that's saying is the cost of materials, you know,
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  to rebuild these homes. You know, everything is is inflationary. So they
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  know what's really going on because it's it's being felt by you know, everyday
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  folks like you and me. Yeah, isn't that the truth? Man?
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  All right? So now the big question ed, and this is why you
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  get the big bucks. What are you supposed to do? Gold? Bitcoin?
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  Uh? You know, Will Rogers, I've said this before, always
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  said invest in inflation. It's the only thing going up, right, That's
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  right, That's right. You know I do love hard assets, you know,
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  gold, gold stocks, gold mining stocks. But the actual physical you
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  know, precious metals I get. I've been a fan of I have heard
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  for thirty plus years. You know, real estate, residential you know,
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  because rents continue to go up. You know, that's that's a very very
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  tough market to buy into right now. So you know, having those assets.
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  I really still don't like commercial markets and won't for a long time as
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  it relates to to real estate. But you know, be smart, position
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  yourself, have a diversified portfolio. And the closer you get to the election,
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  boy, I'll tell you what, man, I would start taking chips
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  off the table and and you know, ride the storm out and when things
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  get a little bit lower, that's that's when you make your money. Is
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  buying back in on I hate to say on the dips because that is going
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  to underestimate it. But you know, I think that's really what's going to
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  happen no matter who's elected in November. Yeah. I could not agree with
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  you more. And what's your take on bitcoin? You believe? All right?
• 16:41
  So full disclosure. I own bitcoins and ethereum, and I've always looked
• 16:48
  at it more as I'm going to catch a lot of flak for this,
• 16:52
  I've always looked at it more as a lottery ticket. Okay, you know,
• 16:56
  being able to get in at an early time, but buying in now
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  it's kind of like Nvidia, right you know, are how close are we
• 17:07
  to the top? I mean when when we go from you know, eleven
• 17:11
  thousand too. I didn't see what it was today, but I know it
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  hit close to seventy three thousand right now. It's estimated that you know it's
• 17:19
  going to hit one hundred thousand, So is there enough enough juice for the
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  squeeze between now and then? Normally I would probably be a believer, except
• 17:30
  for the fact that you've got United States buying into it. You've got you
• 17:36
  know, these major institutions like at JP, Morgan, Wells, far a
• 17:41
  lot of these major banks are buying into bitcoin. So that's telling me that,
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  you know, it's probably going to be a little bit more regulated and
• 17:48
  it could wind up being another fiat currency like the US dollar. Yeah,
• 17:52
  well, it's a little bit different because in theory actually in fact, until
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  they figure out another way, and the quantity of bitcoin in the world is
• 18:03
  fixed, and that is the difference between a dollar and a bitcoin. And
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  you know, do I think it's a little out of hand. Yeah,
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  but it's training at record levels. It's over seventy thousand, down a little
• 18:18
  bit today on the March fourteenth, down two percent, big deal, but
• 18:23
  it made a new high. You know, got to see it break seventy
• 18:29
  five thousand. If I think if it breaks seventy five thousand, I think
• 18:33
  it's a load up, the load up the digital wallet moment. You know
• 18:38
  what, I agree? I think seventy five is if that's the breakthrough.
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  I think we could see another parabolic you know, increase. And you know,
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  I don't think one hundred thousand is out of range by any stretch,
• 18:52
  you know, as far as buys, I'm kind of looking at bitcoin and
• 18:55
  the theorem is the difference wing golden solar, right, you know, e
• 19:00
  theorem is is a little bit financially more palatable for for people to buy into.
• 19:06
  And I think that the theorem is going to go along with it.
• 19:08
  But by without a doubt, Bitcoin is the standard. It really is.
• 19:12
  But I did hear rumors that they, you know, instead of it being
• 19:17
  finite, that they were going to you know, increase the amount of coins.
• 19:21
  So I I I read that too, but it's really not possible to
• 19:26
  do without the consent of all the nodes. Oh that is that? How
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  long? Okay? Yeah, so I really not that with allier if you
• 19:33
  are? Yeah, yeah, interesting, well, interesting times, Eddie.
• 19:37
  Tell us where do we find you? How do we connect with you?
• 19:41
  E g. S I Financial dot com. That is the best place to
• 19:45
  find us. You've got all of our contact information, our podcasts, our
• 19:49
  interviews like like this, they're they're all on our website. And yeah,
• 19:55
  so Thank you very much. Hey, you got a question for Ed or
• 19:57
  myself k L. Carrie lets dot com. Emails are welcome, and while
• 20:03
  you're at our site Financial Survival Network dot com, sign up for your free
• 20:07
  newsletter at appreciate you coming on and we'll talk to you again. So great.
• 20:11
  Thank you very much, I appreciate it. Thanks for listening to Carrie
• 20:15
  Letz's Financial Survival Network, your solution to today's trying times. For the latest,
• 20:22
  go to Financial Survivalnetwork dot com. Financial Survival Network now more than ever,