Latest / Financial Survival Network / Economic Shifts: Inflation, Stagflation, Cryptos and Part Time Jobs - Eddy Gifford #6104

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Economic Shifts: Inflation, Stagflation, Cryptos and Part Time Jobs - Eddy Gifford #6104 · Financial Survival Network

0:00
One place is I going away that I mean, it's it's worked into the
0:04
mandate of the Fed. They want at least you know, they have a
0:08
target of two percent per year, which means they want things to get chea
0:11
percent more expensive every single year. Yeah. So that so like it is
0:17
like built into our system, to our Fiat system, that like there will
0:21
there is inherently ask to be inflation because that that's gonna help ask prices rise.
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That's gonna help Lordal, the state rise, It's going to help you
0:29
know, stocks rise, It's gonna help all those things rise. You're listening
0:33
to Carrie Letz's Financial Survival Network, where you get valuable information you just can't
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find anywhere else to thrive in today's trying times. You need the Financial Survival
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Network now more than ever. Go to Financial Survivalnetwork dot com and get your
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free newsletter and gift. Financial Survival Network now more than ever. And welcome
1:00
you are listening to and watching the Financial Survival Network. I'm your host,
1:03
Gary Lentz. Just got back from a long weekend at Freedom Fest in Vegas.
1:08
Saw a bunch of you out there. It was really a blast.
1:11
And I'll do more on another segment about it right now, we got our
1:15
good friend Eddie Gifford is with us. Eddie, it's great to have you
1:19
back. As always, so soft blanding CPI coming in, you know,
1:26
defies experts. The core PPIZ point four compared to point two. The PPI
1:33
was point two compared to point one. I don't know where they get these
1:36
numbers from. Obviously they haven't visited the Las Vegas strip where I had the
1:42
privilege of paying six dollars and twenty five cents for a small coffee at Dunkin
1:47
Donuts. Not even not even the inflation cafe can beat that. No,
1:52
you're right. It's interesting because you get these two prints at CPI one day
1:57
where we have like the first declinents twenty twenty, and then you've got PPI
2:01
the next data surprises to the upside. And the thing about it is PPI
2:07
is the crux of everything from the standpoint that we live in a world that
2:14
the United States of Erica runs on small business, and so the price of
2:16
things and what gets passed on the consumer matters. And so when we see
2:23
PPI go up like this, even though CPI went down, and it's primarily
2:28
you know, primarily has to deal with like tradely related matters, like the
2:31
cost of labors higher. The cost of things is higher, the cost to
2:35
do things is higher. So even if the cost of goods is lower on
2:38
paper, as you just alluded to, I actually live in Las Vegas,
2:42
so I've seen that compounding effect, and I'm paying at least thirty to forty
2:46
percent more than I was at the grocery store three years ago. So that
2:51
inflation stacks. It's been slowing, it hasn't been going down. Let's keep
2:54
that in mind. Everyone keeps saying inflation is going down. No it's not.
2:59
It's slowing. It's still stacking on top of last year. And so
3:02
we still have this compound interest of costs and it's showing up while in the
3:08
everyday Americans bake account like, we've got massive amounts of debt, consumer debt,
3:15
credit card debt, our loan debt. We're starting to seeing more and
3:19
more for our closures. And because of that, you know, we're seeing
3:24
kind of a destruction of demand, which you know, in a way it's
3:29
by design. That's what the FED wanted to do, was to to basically
3:35
get rid of demand. And if they could do that then they could start
3:38
cutting. But the problem is, like always, you go through the fastest
3:42
rate hike in history, and then you wait too long, and by the
3:45
time that you decide to do something, and you're doing it because you have
3:47
to, not because you want to. And if you're doing it because you
3:51
have to, that mean something broke. And let's not even get into the
3:53
fact that we're in a crazy political landscape right now where volatility is just ready
4:00
to run. We've got some global issues with the Japanese Harry S. Trey,
4:05
We've got issues in China and and and then we've got the you know,
4:11
the everyday American at home, like struggling and ad to to figure out
4:16
do I buy milk or do I buy gas? Like it's you're in that
4:19
spot right now for a lot of people, you know, the people that
4:25
got screwed out of all this stimulus and everything that's happened in the last four
4:28
years has been the middle class. And the numbers are starting to show it.
4:32
Of course, that's why we call them lags. I think that we
4:34
all saw this. I think Kerry, you and I talked about this six
4:38
months ago. Well, you know we saw it, right, But because
4:42
of the lag effect of interest rates and the lag effect of inflation in general.
4:46
Now it's showing up in the numbers, and by the time it starts
4:48
showing up in the numbers usually it's like slow than all at once. And
4:53
so my fear is that, you know, the election happens, and on
4:57
the back end of it, something really bad happens, whether it's a political
5:00
event or or it's just a breakdown. Because you know, you can only
5:05
pop up things so long before the dawn breaks. So the sneak hey,
5:10
you know, like it's the Great Gatsby, How did you go broke the
5:15
you know, slowly at first and then quickly right, yeah, totally.
5:18
I mean, you know when you when you get those those numbers, and
5:23
and it's I definitely don't envi the faeda, right, I mean, the
5:28
Powell has been so strong in his stance against inflation, and now we're in
5:31
this spot where the numbers are doing what they want them to do, except
5:35
for the job markets breaking down at the same time. And now all of
5:39
a sudden, it's like, oh, actually, yeah, these have only
5:41
been part time jobs, not full time jobs that have been being added,
5:44
and they're starting to fess up to that and and so we're just seeing like
5:47
this shift, if you will, and and that shift looks like it could
5:54
become like a true stagflationary environment. And that's where we got inflation, but
5:59
we got another growth. And you know, I think that we were talking
6:01
to me about McDonald's comercial not too long ago where the dad said, hey,
6:06
you know, the kid asks like, what sinflation? And the dad
6:10
says, that's when the cost goes up or my salary doesn't. And that
6:14
is actually a real world, this scenario that we are about to base,
6:17
I think. And if that happens, that just means that, like we're
6:21
due for something bad in the stock work, get you, and typically we
6:26
got those minus forty to fifty percents once every en. It'sh years, spend
6:30
fifteen. We've had zero or six for a long time. I hope it
6:33
doesn't happen, but if it does, it's going to be bad. It's
6:36
going to be bloody, and everyone's going to be like, oh it was
6:40
you could tell. It was so easy to tell. Yeah, but everyone
6:44
was also saying, wow, it was happening. It's different this time,
6:46
right, It's always different this time Eddie, that's yeah, that's Those are
6:50
the words that make you realize it's not different and you need to head for
6:55
the exits. But things are different in certain respects, but they haven't repealed
7:00
the business cycle, and you know, the economy is the economy, right,
7:06
I mean, there's only you know, it's it's kind of absurd to
7:11
think that things are really different, right, Yeah, you can't really think
7:15
that they're different. I mean, the thing is that behaviors, behavior and
7:20
human beings are imperfect, and they're always going to act and react emotionally like
7:25
there's no such thing as they truly one hundred percent objective human being, and
7:29
so as things happen, they react. And we've seen it in behavioral finance,
7:32
to the study of it over and over and over again, where we
7:35
get these you know, manic crazy surges blow off tops, if you will,
7:42
followed by castrophes on the back end. So there's no reason to think
7:45
that it's different this time. That doesn't mean that you run for the hills
7:47
either, though, because it can't not be invested as the market continues to
7:53
go high. We had a crazy weekend and the market's up, you know,
7:57
significantly in the last quarter. But I mean it's up today. You
8:01
wouldn't have expected that. And you know, you look at like cryptocurrencies and
8:05
they're just on it there. Yeah, what can that be? What's what's
8:09
with the crypto here? Huh? Well, I think you know, part
8:13
of it is that, you know, on the back end of the survival
8:18
by Trump, like he's seen as a pro cryptocurrency candidate, and so with
8:22
the odds being kind of more in his favor, now you're seeing money Russian.
8:26
The other thing is just a cycle in general. If you look at
8:31
cryptocurrencies, bitcoin specifically post aving, you usually have some type of consolidation period
8:35
followed by this significant urgent and this could be the beginning of that, or
8:41
maybe this is just an emotional It's like we would want to see it continue,
8:46
not just go for four days. But those are all reasons that they
8:50
couldn't be taking off. Eved I hadn't looked at the price of a bitcoin
8:56
yet. After I woke up this morning, it was around sick. Now
9:01
it's a sixty three and a half thousand. I'd buy some. It's just
9:05
like what you should what you might want to think about doing with gold.
9:09
This works for me and silver, buy a little bit every week buy a
9:13
couple hundred bucks worth of crypto. I mean, I am, like,
9:18
I wouldn't say it's the best performing asset in my portfolio because gold and silver
9:22
really have outperformed it this year so far. But A keeps me interested in
9:28
cryptos and B that uh, you know, it's up. It's up about
9:33
thirty percent since I started. I was swing trading it for a while.
9:39
Then with a move came, I stopped swing trading and I just bought and
9:41
held. And you know, you definitely can swing trade uh crypto profitably,
9:50
but it's not necessarily the thing you want to do because it's so volatile.
9:54
You you got to remember carry that's called work. And when you're in nesting
9:58
obviously, like it's uh for some it's enjoyable, you know, your investment.
10:03
For some people it's it's you know, kind of stressful. And so
10:05
if you're trading, it becomes more it becomes more stressful. Now, obviously,
10:09
when we're doing it, we've got rules and we follow those rules and
10:13
the rules that has worked. So but I couldn't agree with you more.
10:18
I think that gold and silver and cryptocurrency is anything that is basically a owner
10:24
to the fiat system in general is something that is worth having a place in
10:31
your portfolio. You know. The only thing that I was kind of looking
10:35
back and trying to figure out. Okay, Like obviously, like you look
10:37
at it from a volatility standpoint, you say, oh, my goodness,
10:41
like this is a speculative investment when you're looking at cryptocurrency and bitcoin. But
10:45
then when you dig a little bit deeper and you kind of understand what it
10:48
is and what it does and how it does it, it's like, well,
10:50
you know, it's just young. You know, it was a very
10:54
very young asset, but there's a number and it will continue to be a
11:03
counter action to the fiat system. And with everybody mistrusting government in general,
11:11
it's hard to think that stuff like the precious metals gold and silver or something
11:16
like bitcoin isn't going to do really well in that situation. The difference is
11:22
is that you know, with bitcoin there's actually a real live ability to transact
11:26
right now, and so that's basically a huge opportunity. I think, like
11:33
in general, people are coming around to it, but for it not to
11:37
be in your portfolio. Said this about other financial advisors, said this about
11:39
people in general. If it's not in your portfolio and you're making mistake,
11:43
or it should at least have a slot. Now if you would to trade
11:46
it because it's too volatile, that's fine, but it still should be dedicated
11:48
as slots because what you don't want to do is like, oh, I
11:52
got that bicycle, but I really don't want to steal my apple stock now,
11:54
right, And so then you're defeating the purpose. So like you got
11:58
to have like maybe that that depending on your risk callor as that five to
12:03
fifteen percent slot of like this is where the cryptocurrency is going, and whether
12:07
it's being trader or being held. I don't think that matters, but it
12:11
has to be there. It just has to. No, I totally agree
12:18
with you. I've known about it virtually from the beginning. I missed out
12:22
on the major advances. I always know when it peaks. It's really easy
12:28
to know when when bitcoin peaks. I mean I called it in what was
12:35
it two thousand, when it hit nineteen thousand again that yes, twenty twenty,
12:41
and I knew it when it hit sixty seven seven last year. I
12:48
think it was that. You know it's it's not peaking now that I am
12:52
pretty confident of you know. On the other hand, it is the governments
12:58
really wanted to shut it down. It could be shut down virtually instantaneously.
13:03
Even though people tell me I'm crazy, they couldn't be done. I know
13:05
it can be done. And the hey, you just have to look and
13:11
look at what's around and you know you should be seeking some alternatives. And
13:15
I still like real estate because Eddie, when's inflation going to go? Bye
13:20
bye? Well, inflation is like going away that I mean, it's it's
13:24
worked into the mandate of the Fed. They want at least you know,
13:28
they have a target of two percent per year, which means they want things
13:31
to get cheap percent more expensive every single year. Yeah. So that so
13:37
like it is like built into our system, to our Fiat system, that
13:41
like there will there is inherently asked to be inflation because that that's going to
13:46
help ask prices rise. That's going to help lordal, the state rise,
13:50
It's going to help you know, stocks rise, It's going to help all
13:52
those things rise, just you know, having the understanding of when the moves
13:58
sapping more rapidly or the smart places to be. And it's interesting because uh,
14:03
you know, everyone has alreadys had this like flight to safety mentality rush
14:07
to treasure when rates go down. But what we've been seeing more recently,
14:11
like gold does the same thing. Gold and silver does the same thing.
14:13
It usually sniffed it out a little bit earlier, but when you're looking at
14:18
it from another perspective, like look at treasuries and look at the bitcoin.
14:24
Like if you look at you go back to last year twenty twenty three when
14:28
the banks went down, right, and we had like this that you know
14:33
that there was a surgeon raids which should beat up treasuries and cryptocurrencies, and
14:39
then they searched together except for cryptocurrencies, like a ten x version of treasure
14:43
of us. And we saw it again at the most recent of me when
14:48
we when the data came out and it appeared that, oh yeah, we're
14:52
going to actually cunt again. We've seen this run now today is interesting because
14:58
the that the treasuries are down and bitcoin is way out. But that's also
15:03
because bitcoin is a like a fear trade from the standpoint of distrust and mistrust,
15:11
much like golden zilver arm so it kind of gives you it appears to
15:15
be developing into this like one two unched, which you know, could be
15:20
just a really, really good fit for anybody's portfolio. Generally speaking. Hey,
15:24
you know, I've believed in keeping five percent and fifteen percent precious metals.
15:31
I think you can up that a little bit now and not feel too
15:37
worried about it. Obviously, everybody's situation's different. But you know, just
15:43
like I've got probably about twenty flashlights in my house and in the batteries sitting
15:52
in the closet. You don't have too many because they do go bad over
15:56
time, you know, just like you would keep a flash light in your
16:00
house in case the lights go out. I really believe that you need to
16:04
be looking at other assets in the same light. Yeah, and I think
16:10
that the hard thing is that you looked at portfolio for so long, and
16:14
it's always been stocks, bond stocks, bond stocks, bonds, and generally
16:18
speaking, like I can understand the base case behind that, which is that
16:22
they've they've operated with different correlations, like almost inverse correlations at times. What's
16:27
still what the ability to go up over time. The problem is is that
16:32
that doesn't happen when you're inning by in a bond bear market. Bonds tend
16:37
to correlate a lot more socially cheat equities, and so we always we've all
16:42
been programmed to believe stocks and bonds, but really what we should be programmed
16:47
to believe is when matters. And what I mean by that is that we
16:52
want multiple investments to all have the ability to go up over the next five
16:56
to ten years, but we want them to go up at different times.
17:00
We don't want them to have a one to one correlation. We don't want
17:02
them to be inversely correlated, because of are invorsely correlated. They're just balancing
17:06
each other out. And so we want things that go up different times.
17:11
One because it gives us an opportunity to rebalance and buy stuff on sale right.
17:17
And two because like the concept of when things happen basically just like produces
17:25
so much additional return in your portfolio. You can really run a portfolio yourself
17:30
and just pretend that you get a static or a turn of eight percent.
17:34
But every third year one asset goes down by ten and the other fourth year,
17:40
the other asset goes down by ten. And guess what, by having
17:42
those two assets better to just having one, you boosh your return significantly.
17:47
So you've got to make sure that what you have in the portfolio is not
17:51
correlated. We like and we like non correlated, but we also want editors
17:56
return. And unfortunately, when you look at big sed incoming, you look
18:00
at over the last five years, it's like big bat zero. So alternatives
18:06
I, you don't think they'll have a much better place in the portfolio,
18:10
whether it's the precious metals, the cryptocurrencies, or you know, some type
18:15
of systematic managed future strategy that's leaning into commodities and currencies and all of that
18:21
type of stuff. But like that needs to be your offset because bonds just
18:26
aren't it right now, and maybe they'll be cooking again. But like you
18:29
don't want to have a static This is my defense because what happens when that
18:33
doesn't work, like in twenty twenty two and and and that's the conversation that
18:38
you're talking about right now. Keary, short term treasuries, keep your cash
18:44
there. We're not talking we're talking like, you know, longer duration treasuries.
18:49
So don't maybe twice of course, yeah, the long duration stuff,
18:53
like you know that that's traditionally been like the flight to safety, that's been
18:59
the portfolio that saved us, right the bonds saved us during COVID when we
19:03
had that flight to safety and so, but that I stopped working in twenty
19:10
twenty two. I'm not saying that relationship will come back. But to be
19:14
all in and be stocks and bonds, you know, to intermediate to long
19:17
durational the ones, you know, and then as far as like treasuries in
19:21
general. Yeah, like I like short term treasuries for the next one to
19:25
two years, but for two to three years, you need to own any
19:29
of you know. Yeah, well it's it's not really a flight to safety.
19:33
It's a flight it's safe er, right, yeah, exactly exactly.
19:37
And you look out throughout history, Yes, when equities go down, typically
19:41
treasuries go down. Words. I'm like trying to find stuff that might actually
19:45
go up in that situation. Yeah, And there's nothing wrong with that either,
19:51
right right, right. I never had a person complain that their portfolio
19:55
was up when the market was down, but I haven't complained all the time
19:57
if the market's up, then their portfolio down. So yeah, well they're
20:03
always going to find something to complain about, you know, because that's just
20:06
human nature, right Yeah. Well, yeah, realistically, you know,
20:11
you have to you know, you have to look at this from the standpoint
20:15
of historical returns and the uncertainty of the future. You know, like gold
20:22
is always a safe event, except when it's not. Like the past twelve
20:27
years. You know, a lot of the time it hasn't been perceived as
20:32
such, even though you and I perceive it as a as such, right,
20:37
But yeah, tho's it. Two percent interest rates, you know,
20:41
schematic that we had for a long time really changed the games when it came
20:44
to gold, and like small cap stops and like a lot of the stuff
20:47
that you typically look for for additional upside of the cunial or original protection and
20:52
just kind of like stopped working for a little bit. But remember, like,
20:56
yeah, we need to look back one hundred years, not ten and
20:59
then and kind and seeing because things will normalize. They've begun to normalize.
21:03
I mean, five percent rates are actually normal. It's just hard to think
21:08
that they're going to stay that high because of the fact that it's an interest
21:14
payment that we have to make as a country, and it's a the biggest
21:18
line item on our budget. So the crew knows, Carrie, there's so
21:22
many things going on right now, it's crazy. But that's why you got
21:25
to stay flexible, and you got to have true diversification workflow that actually moves
21:30
counters to each other. You do want to have some read on every single
21:36
statement. You know, everybody's like, huh, it's like, no,
21:38
you have Like if you don't have read some read on every single statement,
21:42
you have no protection when the market does something different and in media. So
21:48
it's very very important that that's what diversification is. Owning five hundred stocks is
21:52
not diversification, especially when thirty five percent of that is made up of ten
21:56
stops. Yeah, it's you know, it's like, look at it as
22:03
an insurance policy, like, hey, i haven't had a claim in twenty
22:07
years on my homeowners I'm just gonna stop paying it because I'm just giving that
22:11
money away to the insurance companies. Right, and then the next day,
22:15
I mean, I have a disability policy. I've had it since my thirties,
22:21
all right. They don't write policies like this any longer. They just
22:26
don't, right, And you know, I'm so tempted often to just get
22:33
rid of it. It's expensive and I've never needed it, so I'm just
22:37
giving that money away. And you know, I feel like that maybe I'm
22:42
being superstitious, but the fact that I can't get that insurance ever again,
22:48
I'm too old and they don't write those policies anymore. Hey, until my
22:52
last breath. I'm going until they kick me off. Because it's some age
22:56
that kick you off the policy. I'm not giving it up. Yeah,
23:02
And the thing is is that, you know, I just think it's important
23:04
that you always have like some type of insurance in your portfolio. But that
23:10
doesn't mean that when things are more robust, when the trend is strong,
23:15
it doesn't mean that you can't lean into the trend more. I mean,
23:18
like there's if you're indexes, you can lean into individual stocks. If you
23:22
don't like individual stocks, there's like two X and three X strategies out there
23:26
that you can lean in. I mean for the short term as long as
23:30
they're trying to strong. As soon as they're trying to slows, just move
23:33
back into no leverage and move back into the indexes. Right, so you
23:37
can still lean into that, and you know what, you'll feel, you'll
23:41
feel better about taking that chance. If you have some insurances in your portfolio
23:45
in the first place, you probably won't take that chance. Ever, So
23:48
by having the insurance. I always tell people this, whether we're talking about
23:52
gold or managed futures or cryptocurrencies or annuities, right when that stuff is in
23:57
the portfolio, now, that allows us to be okay with taking more risks
24:02
over here on the other side, and and what can do that that that's
24:06
what really gives you the ability to win in the long run and no risk,
24:12
no reward. I don't mean I've been an athlete my whole life,
24:15
and and you know, I know that like if I didn't take the risk,
24:18
I wasn't going to win the match in wrestling, And when you're when
24:23
you're investing in it's no different. But that you that it doesn't mean you
24:26
take a necessary risk. This it doesn't mean that you don't get calculated risks.
24:32
Yeah, And that it doesn't mean that you don't maintain like some type
24:36
of foundation you know what in sport, it's usually an athletic stance. In
24:40
a portfolio, it's that core of like UH of insurance protection and offset,
24:45
and then that gives us the ability to take those chances and when they pan
24:48
out, all you need is like one out of five and then to pan
24:52
out and you're winning. Yeah, No, no, question about I couldn't
24:55
agree with him, Moore. Eddie, where do we find you these days?
24:56
So? How do we connect with you on the web? Yeah?
24:59
Same, But I mean, obviously you can just google Eddie Giffer. That's
25:02
Eddie with a y g I f f r D. Go to tactive wealk
25:04
dot com, back splash Eddie dash Gifford Again, it's Eddie with a Y
25:08
so e d d y dash g I f f or r d on the
25:12
site. And yeah, we're here to help. We're here to provide an
25:17
additional resource, if you will, of acknowledged and information and perspective and uh,
25:22
you know, we're just we just like to see people meet their goals
25:26
and if we can be there to help them do that, then that's even
25:29
better. All right. Hey, the links are in the show notes to
25:32
this interview on Financial Survival Network dot com. Make sure you go there.
25:36
Sign up for you free newsletter. Click true you'll get right over to Eddie.
25:40
Appreciate you coming on, Eddie. We will talk to you again real
25:41
soon. Be well. Awesome, Thanks Kerry, having a good wed Thanks
25:45
for listening to Carrie Letz's Financial Survival Network. Your solution to today's trying times
25:52
for the latest go to Financial Survivalnetwork dot com. Financial Survival Network now more
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than ever,