Latest / Financial Survival Network / Europe’s Retroactive Recession - John Rubino #5831

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Europe’s Retroactive Recession - John Rubino #5831 · Financial Survival Network

0:00
Well, China did engineer the biggest real estate bubble and human history, and
0:05
they haven't fixed that or anything. They've just been kind of paypering it over.
0:08
And you know, there's really no way to fix something. I mean,
0:11
in Japan tried to fix THEIRS with government spending plan after government spending plan,
0:17
but since the nineteen nineties they have been hobbled by their real estate bubble,
0:23
and China's kind of got the same thing going, except it doesn't have
0:26
the advantages that Japan had back then to allow it to just keep kicking that
0:31
can down the road, So they're going to have to deal with it pretty
0:33
soon. You're listening to Carrie Let's Financial Survival Network, where you get valuable
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than ever, And welcome. You are watching listening to the Financial Survival Network.
1:06
I'm your host, Kerry Lutz. Well, it's been quite a week.
1:08
The economy just doing fine, even while Europe is slipping into recession.
1:15
John Right yeah, and it kind of happened by the back door because they
1:22
revised past couple of months data, and that's what put Europe in recession.
1:27
The revisions, Yeah, retroactive recession or recession. Yeah, so they're they're
1:33
technically in recession, which you know, gives the ECB a little bit of
1:38
leeway even though inflation is way above DCB's target. If the EU is in
1:48
recession, maybe that that gives them their excuse to at least stop tightening and
1:52
maybe go back to using We'll see, But I think the US is maybe
1:56
our recession or our revisions will put us in recession here right now because we've
2:00
got a lot of weak numbers and some not so weak numbers, so it's
2:04
kind of a mix. But maybe a lot of the strong numbers have to
2:08
be taken away in the next couple of months and then we'll see. Well
2:15
look, I mean, honestly, if you look at the real rate of
2:17
growth over the past two years, it hasn't existed. So therefore all apparent
2:25
growth is generated by inflation deflator by it being incorrect. So when you really
2:32
look at it, Yeah, they could just up the inflation rate for the
2:36
past two years because nobody cares because that's in the past, we would be
2:40
in a recession and then we're ready to get out of it now, I
2:44
guess. Yeah, And when we were talking about recession before, I was
2:47
talking about official recession where they admit it. But yeah, you so many
2:53
of these numbers are so bogus or so open to revision, because that's kind
2:59
of the their strategy now, at least in the US. I'm not sure
3:01
it's done that way in other countries, but maybe, but the US will
3:05
put out a super favorable number and then revise it away over the next couple
3:10
of quarters or months or depending on the interval for the number, but nobody
3:15
sees the revisions. So all anybody sees is the super positive headline number,
3:20
and they're using that as a way to manage perceptions even as things get worse
3:27
and worse. So, you know, I'm sticking with my prediction that we're
3:30
in recession by year end and that six months after that the fet is back
3:35
to actively easy. So we'll see. But you know, I don't think
3:38
it's really hard a hard gat from here. You know, we could easily
3:43
tip over, and yeah, it's just a question of when the feed is
3:49
going to pivot. People say they're not going to and they're just gonna keep
3:53
raising rates. But look, housing is in the gutter, jobless claims are
4:00
up, all of these things that we're supposed to figure out, and then
4:03
if you look at China's exports and their imports, they're down the drain.
4:09
I don't see how you can ever recession in China without the rest of the
4:14
world feeling it. At this point, John, we'll see the way it
4:16
always works. If you go back to, for instance, nineteen nine,
4:19
two thousand or two thousand and six, two thousand and seven, the Fed
4:24
titans, and it continues to tighten until the financial markets break because it has
4:29
no other way of knowing, you know, whether it should still be tightening
4:32
or not. It just watches the financial markets, and when they break,
4:35
then it knows it's time to go back to easing. And so the same
4:40
thing is happening now. The Fed is just raising interest rates and raising interest
4:43
rates, even though they say they're going to stop this month, but they're
4:46
gonna pause this month, they'll go back to raising again pretty soon, and
4:50
they'll do that until something serious breaks. And there's a long list of things
4:56
that can break here going forward, I mean housing and commercial realists and cars.
5:01
And you saw the student loan thing right where they're going to go back
5:04
to making student loans payable now after two years of being free money. And
5:11
you know, a lot of the people who have student loans are the same
5:14
people that are maxing out their credit cards to pay day to day expenses.
5:18
So now dump of three or four hundred dollar bill for student loans on top
5:24
of that life and a lot of people are going to start defaulding on their
5:27
credit cards or their mortgages or their car loans or whatever, and boom,
5:33
we're in recession when that happens. So it could be that we're going to
5:36
look back on the student loan thing as the trigger or the next recession.
5:43
So not that it has to be, because there are lots of other things
5:46
that can go wrong, but that could easily be one because that'll hit consumer
5:49
spending very hard, and it'll hit credit card debt. It will make credit
5:55
card debt go up even further. So it's completely possible that we're already seeing
6:00
the pieces being put into place that will cause the next recession. You know,
6:04
it's amazing that every day I still get credit card offers at the same
6:10
time, while the whole thing's imploding. I guess the number. Not that
6:14
my credits are esteem are perfect, but I have nothing bad on it.
6:18
They're still offering credit consumer credit to quote unquote worthy consumers. Yeah, they
6:26
don't even like us because we don't pay late fees or carry balances. The
6:31
credit card companies make most of their money from balance interest and from late fees,
6:39
and you know the groups of people who pay those things tend to be
6:43
the most disadvantaged. You know, there's the people who are so ignorant they
6:46
don't know how credit cards work, or who are in such tough straits that
6:49
they have no choice but to carry a balance even though it charges from twenty
6:55
three percent a month interest, or generate a bunch of late fees because there
6:59
are some months when they just can't pay anything. So credit card companies are
7:03
you know, they're one step away from loan sharks. They are criminal enterprises.
7:08
Let me just say that out loud. But they don't like us,
7:12
you know, they don't like people who pay, who are boring, who
7:14
pay their balances off every month. Yeah, we don't. We don't make
7:17
anything for them. They're they're actively hoping that they can trick us into high
7:23
enough balances that we pop into that other category of people who have to carry
7:27
the balance and generate LAFE fees and stuff like that. So when when they
7:30
offer you a new credit card, carry, that's what they're trying to do.
7:32
They're trying to take you above your manageable limit. And you know,
7:38
what I'm getting is a bunch of balance transfer offers. So we'll only charge
7:43
three percent if you, you know, and no, thanks, I don't
7:47
want to play. But but yeah, And to the extent that they're they're
7:54
extending more credit to people in those other categories, or they're pushing more people
7:59
in our categories into those other categories. Credit cards are going to be one
8:03
of the big problems in the next recession because you know, there's always already
8:05
a trillion dollars a credit card debt, so that's going to explode pretty soon.
8:11
And you would think the credit card companies wouldn't like that and would actively
8:15
try to get out of it because then default spike. You know, they
8:16
lose a lot of money in a recession because the people they've been feasting on
8:22
just say screw it, I'm not paying these credit cards off, you know,
8:26
and take me to court. What are you going to do? I
8:28
have nothing? Yeah, I already have a rotten credit score. Well yeah,
8:31
you know it's funny because yeah, they just want to get your hooked
8:37
one easy credit and then eventually you'll be paying thirty percent. That's like the
8:41
rate now on carrying a credit card balance. Because of the vagaries of our
8:48
gap generally accepted accounting principles. It's like they reserve for the default up front,
8:56
so they actually get to reduce their profits anyway, so less taxable profits,
9:01
and then when things are bad, they just bump it up a couple
9:05
of points, but they're still making money on it. And you know,
9:11
I was in this world for a long time. Well, in the meantime,
9:15
something's going on in China. They know a gold buying is up there.
9:20
If you watch the videos, and you know, I think that there's
9:24
the equivalent of Radio Free Europe in Radio Free Asia on YouTube. A lot
9:30
of these channels seem to be like ultra nationalist, you know, hate China
9:35
channels, but there's enough truth in them to see that something very bad is
9:39
happening in China now. Massive youth unemployment, massive defaults. They're on a
9:46
mortgage strike four million people. It's like the global economy when it broke.
9:54
It really broke for China because they're just getting you know, unemployment is way
9:58
up. They think they have a thirty percent youth unemployment rate. And these
10:03
people are like living in these hovels so they don't have to pay rent.
10:07
I mean, something is happening there that's really bad, John, that we
10:11
don't even appreciate over here. Well, China did engineer the biggest real estate
10:16
bubble and human history, and they haven't fixed that or anything. They've just
10:20
been kind of pay perm it over and you know, there's really no way
10:24
to fix something. I mean, in Japan tried to fix theirs with you
10:28
know, government spending plan after government spending plan. But since the nineteen nineties
10:33
they have been hobbled by their real estate bubble, and China's kind of got
10:37
the same thing going, except it doesn't have the advantages that Japan had back
10:41
then to allow it to just keep kicking that can down their own. So
10:46
they're going to have to deal with it pretty soon. And you know,
10:48
it's not clear how you deal with something like that, because, like you
10:50
said, there are millions of people who already can't pay their mortgages, millions
10:58
more who are living in human conditions, and that they haven't even had the
11:03
actual crisis yet. There's still a lot of ghost cities out there and empty
11:09
buildings and people who have bought apartments but the apartments aren't even being built anymore.
11:16
So people, somebody gets screwed somehow. They're right, you know,
11:20
somebody has to eat that loss. And it almost doesn't matter who eats the
11:24
loss because it has the same general effect on the economy. It's somebody who
11:28
can't pay their bills. Going forward, the people eat the losses will be
11:31
the ones who are least able to afford it, just like in the United
11:35
States. And maybe we're missing the boat. Maybe we should be setting up
11:39
a resolution trust company in China to buy all these snap up all these defaulted
11:46
mortgages and just wait for it to turn around or is it never going to
11:52
turn around? There that question? We don't want those mortgages. Yeah,
11:56
Now that your dath would be a logistical nightmare to try to make sense out
12:01
of what's coming there. Um, but you know, we got another kind
12:05
of nightmare with commercial real estate here. There are a lot of buildings that
12:11
are semi empty and are going to have to be sold for half of their
12:15
original price, and somebody has to eat those losses. It's not it's not
12:20
clear ahead of time who's going to eat the bulk of those losses, but
12:22
it could be banks, could be hedge funds, pensine funds, insurance companies.
12:28
Yeah, all the bond holders, you know, the real estate bonds,
12:31
the mortgage backed security bonds on the cr bonds. Um. You know,
12:37
it's not clear, um who who has to suffer the bulk of this,
12:41
but it's probable that five or six different categories of big financial entities are
12:46
really going to get smacked by this. And it's coming pretty quickly now,
12:52
you know. It's that whole bust is accelerating. So I think that's a
12:56
second half of the year story that's going to have some hair raising numbers.
13:00
You you should, if you don't already, interview Will Richter because couple weeks
13:05
ago, okay, because San Francisco, like the biggest hotel company there,
13:13
just did some jingle mill and sent the keys to their hotels to their lenders,
13:18
and they say that the office buildings are are trading at a seventy percent
13:26
haircut. I was in Manhattan the past week, and look, there's tons
13:31
of construction, so there's always traffic in Manhattan, but really it's empty like
13:35
used to be. You'd walk out at lunchtime and there'd be like tons and
13:39
tons of people milling about. I don't know if they're scared of getting mugged
13:43
and they just don't go out of their office till they have to leave.
13:46
But I'm telling you that place is you can't call it a ghost town,
13:52
but it's definitely a bit spooky there. So carry you were just in Manhattan,
13:58
right, yeah. And it's smoky when you were there too, So
14:01
it was it like a zombie apocalypse with empty streets and smoke everywhere. And
14:05
you know, I didn't stay up on the news. And I'm on the
14:07
airplane and LaGuardia looking out and it's this white all around, and the person
14:13
says to me, look at that, and said, yeah, so that's
14:16
from the fires up in the Quebec in Canada. Because we got out just
14:22
in time, they closed the airports for a day or two. Next day,
14:24
I think there's Luguardia is still closed. But Kennedy and Newark were supposedly
14:28
open, but it was like some white Yeah, you never saw anything like
14:33
it. I mean it was pretty shocking. Se See, you guys on
14:37
the East Coast, you have your problems, you know, but that's not
14:39
supposed to be one of them. That's supposed to be our problem over on
14:43
the west, on the West coast, because we you know, we lose
14:46
like August every year now because it's just we're blanketed in snow or in smoke.
14:50
But that's as new for you. Yeah, hopefully it's not a regular
14:56
thing. Yeah, well, it happened about fifteen years ago, but not
15:01
this bad. I don't remember it being this bad. But you know,
15:03
I couldn't figure out why my sinuses were like in total rebellion, you know,
15:09
when it was. I came back on Tuesday instead of Wednesday, but
15:13
my sinuses were a mess. I'm like, what's going on. It must
15:16
be some kind of allergy or something as an allergy to smoke. But the
15:20
Tesla has got biodefense mode. So if you're going around in your tesla,
15:26
maybe have to live in your tesla for a week or two, you're going
15:30
to be okay because it's got the Heppa filter and biodefense mode. So even
15:35
if they if they do some biowarfare while they're at it, you'll be okay.
15:41
So you can just go out and sleep in your car. The smoke,
15:43
yeah, goes all the way down the east coast of Florida. Okay,
15:46
yeah, yeah, it's funny. My wife saw that. She's got
15:50
a lot of chemical sensitivities and stuff, so this is this is a real
15:52
thing for her. And she saw that in the Tesla pickup truck and we
15:56
had to have a long talk. I had to actively talk out of not
16:00
going out and buying a Tesla pickock truck because she was envisioning getting into the
16:03
bed and closing that steel door and turning on the fielder. You know.
16:08
Combine combine that with bulletproof windows and I'm just about sold. And bulletproof door
16:15
panels, you know, arden stainless rolled, stainless steel that'll stop forty five
16:22
caliber bullets from entering the cabin. So, hey, did you catch this
16:26
article? Twenty nine percent of young Americans are okay with government surveillance devices in
16:33
the home. Now, this is nineteen eighty four. Remember the screen in
16:37
nineteen eighty four and they monitored everything, and the thought police and everything else.
16:41
I mean, where did these kids go to school? And I mean
16:45
it's it's nuts. Yeah, this is truly terrifying because these guys, well,
16:49
you know, part of it is, like you said, where they
16:52
go to school? Because I think there's not a fundamental understanding of the First
16:56
Amendment and a limited government and what dictatorship truly means. Or you know,
17:03
let's say it's twenty two year old who has no sense of history, couldn't
17:06
couldn't find two different countries on a map, and they think, well,
17:10
you know, what the hell, let's have the government spy on those other
17:14
people's homes to keep them from doing bad things. You know, they don't,
17:17
they don't realize that that that will come back to bite them at some
17:19
point. But you know, one other way looking at this is that every
17:22
generation of kids has to find a way to freak its parents out, in
17:26
other words, too, to make that dividing line between you and my parents.
17:30
It's working. It's working. You know, half of them are trans
17:33
and the other half are fascists. It's uh. And there's a vend diagram
17:37
where some of them are both brands and fascists now, So yeah, it's
17:41
there's absolutely succeeding and freaking their parents out. Oh my goodness. Well,
17:47
I had a great discussion with my son in law where basically, without getting
17:55
too into it, I think you're allowed to say stuff now about baxing and
17:59
COVID and elections. But basically he said that I was right about everything about
18:07
the health issues we had for the past couple of years, and he himself
18:11
had had an ailment for over a year that he couldn't say for sure that
18:18
it was from the vax or whatever, but he felt pretty confident and he
18:22
was grateful that his kids didn't have to get it. So there is hope,
18:26
and don't give up hope on this generation yet because he was really like
18:33
a woke person two three years ago and now all of a sudden he gets
18:37
it. And this guy has got an IQ way higher, at least thirty
18:41
points higher than mine, and he brought into it all but no more.
18:48
Well, IQ was inversely related to attitude on vaccines here, so no surprise
18:55
that you're the smartest kid in your family was the most pro vaccine, but
18:59
too things about the first carry. Congratulations, you have moved into the next
19:03
stage of parenting where your kids come back and say, dude, you were
19:07
right. I'm still I'm still waiting for that. It's amazing how much,
19:11
you know, from the time I was seventeen to the time I was twenty
19:17
five. Was amazing how much my parents learned in eight years. But you
19:23
know, okay, the second thing I want to say about this is that
19:26
you know a lot of kids now they think what they think because they've never
19:30
had to consider survival as the thing they had to actually go out and make
19:36
happen. You know, They've never had to deal with real hardship. And
19:38
in the next few years, hardship is going to be the you know our
19:42
middle names. Things are going to be much much tougher, and you won't
19:48
see nearly as many kids or obsessing about the ideas that they obsess about now,
19:55
because they're going to be obsessing about where's my next meal coming from?
19:59
You know, that's the you know, major financial crises are not something you
20:02
should look forward to, but that is the one upside is that it educates
20:07
ignorant people very quickly about the important things in life. Yeah, it's my
20:11
next meal is coming from my food stamp allocation of course, my EBT card,
20:17
you know, goes on EBT cards. Everyone knows that, so we'd
20:21
be remiss. We're talking about RFK Junior prequel and Tucker Carlson, and the
20:26
two of them kind of have like an alliance almost now. Tucker Carlson storm
20:32
Twitter, and I think that's the death knell of Fox because they're trying to
20:37
say he breached his contract. You know, they've already lost half their audience,
20:41
two thirds of the paying audience twenty five to fifty four. If they
20:45
sue Tucker Carlson. How many people are going to be left watching this station?
20:52
Yeah, so this is a illustration of how big Tucker Carlson is.
20:56
He posts a video on Twitter her okay, which isn't even a place where
21:02
people normally post and minute videos, and it it's what is it now,
21:07
seventy million views or something like that's something that dwarfs. Yeah, MSNBC,
21:14
CNN and Fox did not have one tenth combined. It didn't have one tenth
21:21
of Tucker Carlson's viewership from a Twitter video. Yeah. And you know the
21:27
funniest part of this is you knew, you know who Taylor Lorenz is,
21:33
right, Okay, worse, worse human being on her. But anyhow,
21:36
she posted a thing about how, oh this shows how he's never going to
21:40
make it and he look, he looks so out of place, and that's
21:41
a Chensey video and he's not going to get viewers on Twitter. And she
21:47
posted that kind of quickly. And now now that it's up to seventy million,
21:51
I don't I don't think she's going to be revisiting that subject. Yeah,
21:55
dumbest person in the world. So Tucker's got the media industrial comm spooked.
22:00
And look, I could go into a whole thing about restrictive covenants in
22:04
New York. I sued. I had four cases in my i illustrious legal
22:10
career, and I lost every single one of them, even though it was
22:14
right on the law. I lost every single one. The only time I
22:17
won was when they stole customer lists. There's no way to stop him,
22:22
even though they're saying, well, we're paying you twenty five million not to
22:26
compete with us. Technically under New York law, that will work, except
22:32
that when you go to the court and he says, well, I don't
22:33
want the twenty five million, I just want to talk. That's going to
22:37
be the end of that, they can't win the case. It will just
22:41
damage the brand even worse. But just like Tucker's got the media industrial complex
22:47
on the balls of their heels, RFK has got the Dems spooked and on
22:53
the balls of their you know what. Okay, two things here. One
22:59
is do you think when they were writing Tucker Carlson's contract if he'd said,
23:03
you know, you don't care I post on Twitter once in a while,
23:07
do you they would have said, sure, we don't care. Right,
23:08
So there's no way his contracts can actually cover or forbid Winter posts because that
23:18
that wouldn't have been considered competition or Fox Now all right, so he wins
23:22
that, um, the non compete thing with no trouble. And the other
23:27
thing is, yeah, um, RFK Junior turned out to be a serious
23:30
political stud Um. He and Tucker Carlson must never ride in the same car
23:37
now on the fly, at the same time, the same plane. It's
23:42
deep staying well, just they'll see that as a twofer in tone where we
23:47
only have to blow up one vehicle to kill both of these guys. They'll
23:51
go for it just reflexively, and they don't get many two fers. I'm
23:53
sure not that easy. Look. They don't really look. They only terminate
24:02
with extreme prejudice when they have to. They rely on the media to do
24:07
the character assassination, which in this day and age is generally enough, except
24:11
that everything bad about this guy has already come out. I mean, there's
24:17
like files, and I know some of it personally, having lived in the
24:21
same areas him for a number of years, him and his sister and Antiquoma,
24:29
like forget it, like the guy's bulletproof. I don't think any moral
24:34
or ethical quandary ever enters into why somebody votes for Kennedy. Yeah, well,
24:41
you know, and I think Trump kind of softened us up or stuff
24:47
like that. I mean, you know, anything that somebody's done now you
24:49
immediately go. But didn't Trump do even worse? And he was president?
24:53
And then there that's the end of the discussion there, you know. And
24:56
but you're right, m With a candidate, you know, you get good
25:00
and bad. With the Kennedy you get the name recognition that's that guarantees you
25:04
ten percent right off the bat in any Democrat election, But you also get
25:10
the assumption of horrendous moral deficiency. Right, we just assume Kennedy's there's terrible
25:17
people in real life, so yeah, I'm never disappointed either. They're not
25:22
so far disappointing. And just to read the needle here, they both said
25:33
that a certain three letter agency was responsible for the assassination of rfk's uncle.
25:40
They both said it like definitively like based on you know, experience, fact
25:47
and all that. So right there, it marks the two of them as
25:51
an existential threat to the string really running things. John. The CIA can
25:56
never allow some to become president whose relatives they've killed, right, because then
26:04
the president will dig into their their durty. Oh yeah, yeah, that's
26:07
true. They can never let this happen. Boy JFK is brave or RFK
26:12
is brave you know, uh, GEK more crazy than brave. But then's
26:18
my personal opinion. Hey well military, right, you got to be a
26:22
cepath to want to be president and that all requirement. That's true, that
26:27
that is kind of an assumption that you're at least a narcissist if you're running
26:32
for president, but but self destructive. You got to call it self destructive
26:37
if you you're reasonably sure that the CIA will kill you if you get close
26:41
to the presidency and you try for it anyhow, that's great. Well,
26:45
hey, censors they are. Hey, we're just exercising opinion dot fact and
26:51
all that good stuff. Well, I think we'll leave it at that.
26:53
John, make sure you go over to John's substack Robino dot substack dot com,
27:00
sign up, subscribe to his substack, and questions comments kl atcarry Lutz
27:06
dot com. We'll answer as quick as we can. Write your YouTube comments
27:11
below. John, We'll see you in a week and a half. Thanks
27:14
cars, see you. Thanks for listening to carry Lets's Financial Survival Network,
27:18
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