Latest / Financial Survival Network / A GDP Number Too Good to be True -- Eddie Siddell #5890

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A GDP Number Too Good to be True -- Eddie Siddell #5890 · Financial Survival Network

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  If we look at GDP and the inflation numbers, you know, if we
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  use the same math and formula that we use back in you know, in
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  the eighties under Reagan, you know, I think we'd have different numbers.
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  So it's it's hard to kind of figure out what's real and what's not a
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  little bit and that's the most unnerving thing. While we're looking at all the
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  debt, all the other issues that we're facing. Right now, you're listening
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  to Carrie Letts's Financial Survival Network where you get valuable information you just can't find
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  anywhere else to thrive in today's trying times. You need the Financial Survival Network
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  now more than ever. Go to Financial Survival and Network dot com and get
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  your free newsletter and gift. Financial Survival Network now more than ever. And
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  welcome you are watching listening to the Financial Survival Network. I'm your host,
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  Carrie Letts. Well, we just got a surprise GDP print two point one
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  percent at the days are here again. A will have said to use it
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  as a pretext to raise That remains the question Eddie Sidell has the answers,
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  Eddie, great to have you back on. So Hey, thanks for having
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  me. So what about this number here, I you know, not surprising,
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  you know, like like we were talking about just a couple of minutes
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  ago. I'm not shocked. I think a lot of people are. You
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  know, EA's with the dollar and the math, none of the math is
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  making sense. I mean when you think about with bricks, the US dollar
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  now, you know, increasing in value, you know, from where it
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  did below one hundred two. I looked earlier today it was one oh four.
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  I'm not exactly sure where it is right now. You know, none
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  of the things are making sense except for what Pal said, not so much
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  that it made sense, but he's he's already kind of pigeonholed the FEDS and
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  what the monetary policy is going to be because he said he's going to hold
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  true and fast that two percent mark. And so if he does that,
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  you know that means there's going to be a twenty five basis point raise and
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  maybe one more, even though it's it's lagging. But you know, again,
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  if we look at GDP and the inflation numbers, you know, if
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  we use the same math and formula that we use back in you know,
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  in the eighties under Reagan, you know, I think we'd have different numbers,
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  So it's it's hard to kind of figure out what's real and what's not
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  a little bit and and that's the most unnerving thing when we're looking at all
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  the debt, all the other issues that we're facing right now. Yeah,
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  so do you think that really gives them a basis if you will, to
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  raise rates, because look, the two year is U is well ahead,
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  it's at said funds rate is well ahead of the two year treasury, which
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  they yeah begging. So the two year, you know, the two year
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  treasury is down at like four eighty five. Maybe it's gone higher after after
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  this number came out. I haven't seen it yet, but is that the
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  that is the question here is is that is that going to lead them to
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  raise rates again or do they just leave it for the time being an ope
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  for the best, you know, whether they raise it quarter percent or not.
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  You know, the market's already kind of braced it in a little bit.
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  You know, the market's reacting to the the not as good news for
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  the GDP number. So you know, it looks like we could finish another
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  positive day for the third day in or row for the markets. But you
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  know, again, I would be shocked if the Feds actually pause and don't
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  raise rates. You know, I think if they if they pause, it's
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  going to inflation is going to come roaring back. And it's already here.
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  I mean, look, we're spending over five billion dollars a day. It's
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  actually more than that. If you look, if you go back and you
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  look at when we actually broke thirty two trillion in UH in our in our
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  national debt, it's been you know, roughly seventy five eighty days. And
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  at that rate, you know we're gonna overspend. We're gonna have definite spending
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  in excess of three trillion dollars a year. That in itself is inflationary.
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  I think the other things that power are is looking at. It's wage increase.
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  You know, you've got these large unions that are renegotiating contracts, you
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  know, for increased salaries and wages, and so that's creating a lot more
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  pressure upward pressure on inflation. So I think he's looking at everything as a
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  whole instead of just you know, the Fed funds rate at five and a
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  half versus the two year treasury And you know, I don't think he's going
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  to put a whole lot of stock into the GDP number being two point one
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  perc. You know, I you know, honestly, I think he's going
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  to be looking at everything, and if he doesn't, you know, inflation
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  is going to come back. You know. The big concern for me is
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  how long are we going to keep rates where they're at? And is the
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  election next year going to be a determining factor that says, you know,
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  let's go ahead and lower rates one time? Because you know, James Carvill
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  said the best right, it's about the economy stupid. So they're I think
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  they're looking at this, even though they're trying not to be political. I
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  think they can't help but be so all right, so you think it's going
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  up, then anyway they'll because they've got a free ride to do it because
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  the market has been going back up and so he's just gonna do it.
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  But really, are they really shooting for two percent inflation here? Eddy?
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  I don't know how they're going to do it. You know, it's you
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  know, more than one in a quarter below the hundred year average. I
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  mean, I just don't see how it makes sense. And if they do,
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  and they keep pushing it, they're going to have to reason rates to
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  a point where you know it could wind up breaking the economy. You know,
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  you've got debt at all time record highs across the board. A credit
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  card debt is over a trillion, You've got revolving debt can skip me over
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  one point three trillion. Student loans are coming due October one of this year.
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  People are going to have to start making payments on it. You know,
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  we're getting a lot of jobs that are coming out, but they're mainly
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  in retailing, the service industry. And you know, we've talked about this
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  before. In my opinion, you know, I think those are more you
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  know, second and third jobs. They're definitely not those high paying career jobs
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  that most people are looking for by benefits. So you know, I heard
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  a phrase and I really like it. It's called the silent recession. You
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  know, I think that we're people are feeling it right now. The paint
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  at the pumps, you know, they're they're struggling to pay all their bills
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  at the end of the month. And uh, and I think we're I
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  think we're in for a long haul. I do. Okay, So the
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  silent reset, and maybe it's not as silent as it appears. It appears
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  that it's here. And hey, if you know, if a tree falls
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  in a forest and nobody hears it too, did it fall? Right?
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  That's right, that's right. And you know, and that's the thing,
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  because everyone knows when they go to the grocery store. So I'm a treasurer
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  for a charity local sports club, and the cost of food, you know,
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  when we're feeding the team is a thirty percent higher than it was last
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  year, So it's across the board. And then you have to pay for
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  the gas. You know, there's all these things and when you you extrapolate
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  that out, and then we're talking about the you know, everyday American family,
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  it's a struggle. It's a day to day struggle, day in and
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  day out. And that's why I called the silent recession because it's here,
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  but no one's really talking about it. So what do you do here?
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  As an individual approaching retirement at some point in your life? How do you
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  prepare for this awful series of events here? You know what heads your bets?
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  Excuse me, I you know there's a lot of risk off investments,
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  you know, the the six months one year treasury, You've got a lot
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  of money market CDs there. You know, now it's the time to take
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  advantage of it. I think September is going to be volatile. I do
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  believe that the year is gonna finish up strong. You know, why risk
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  it if you don't have to. I mean, there's enough places to shelter
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  your money. And again we talk about it all the time. I'm a
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  fan of precious metals, you know, golden and ceber, not so much
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  as as an investment, but as a storage of value. You know,
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  the investing part would be the you know, the mining stocks, so and
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  again have that as a small portion of your portfolio. But yeah, that
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  you know, you've got to head your bets right now. So heads your
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  bets and get ready for the inevitable. Huh, I think so? I
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  think so. You know, when I say inevitable, I don't think it's
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  going to be crash landing, but it's it's going to be here to stay.
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  I really believe that for at least in the near term. Okay,
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  So, so what anything else in particular you're doing to personally prepare for what's
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  coming. You know what we just talked about, you know, I there
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  there's I still utilities were hit really really hard as of late, you know,
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  fuel, gas, energy, You know, I think that those are
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  some pretty good plays right now, those sectors healthcare. But again, you
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  know, it's hedging your bets. The majority of all of the portfolios that
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  we have across the board are in those short term investments that are that are
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  risk off type situations where we're generating a good ready to return for not a
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  whole lot of risk. Okay, I like it, and Eddie appreciate you
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  coming on sharing wisdom with us about the latest to GDP print and it's enlightening.
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  Where do we find you? How do we connect with you on the
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  web? Eg SI financial dot com. That is the best place to find
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  us. Okay, and links in the show notes in this interview on Financial
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  Survival Network dot com. Make sure you go and you sign up for a
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  free newsletter. If you got a question or comment, shoot us an email.
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  We'll get you an answer. K l at carry Lutz dot com.
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  Eddie, always a pleasure. Thanks for stopping by, Gerry, I appreciate
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  it. Thanks a good one. Thanks for listening to carry Letts's Financial Survival
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  Network. Your solution to today's trying times. For the latest go to financial
• 10:43
  Survival Network dot com Financial Survival Network now more than ever,