Proverbs 12:11 – “He that tilleth his land shall be satisfied with bread: but he that followeth vain persons is void”
A Lot Of People Will Lose All Of Their Money
The global economy has not recovered to its 2018/2019 pre-COVID peak. A lot of people will lose all of their money because of over evaluated assets, Fed rate hikes etc.
Valuations are still very elevated, even though down 20 percent and counting from the start of the year.
Global money supply (liquidity) has been in contraction this year. Thus, we can assume asset prices will come down because of this.
Corporate earnings estimates have come down substantially already in many countries, but not for the US. Just yet..!
Demand destruction from inflation & Fed interest rate hikes are swiftly impacting sales.
Investors were told for years that “cash” was trash! Looks like someone doesn’t know everything huh?
Stocks, bonds, real estate and commodities are getting their butts kicked this year, so there’s been no place to hide — except cash!!!
True cost of living increase is much higher than CPI reflects. They will never tell the public the truth.
Real world food inflation is close to 39%. I know its much higher than what is being told. This is crimping consumer spending.
Conclusion
People are spending less and eating out less. This will ultimately hurt restaurants, grocery stores, small business etc.
Do you want the truth? There is bad news about the current state. Two things will happen.
- If the Fed stops raising interest rates, inflation will resume or 2. keep raising rates that will create great pain for consumers & businesses
We are in this situation because the central banks held interest rates too low for too long.
Capitalism has been seriously compromised.
US became great because its wealth was widely distributed across the nation. This is no longer the case.
In the past, politicians who acted against the interests of the people were often beheaded. There were severe repercussions. Today, there are no repercussions for poor governance.
We need to cut government’s size down, to something like 20% of the economy.
We’re now in a lengthy environment of unattractive returns of assets. Expect more taxes/regulations/meddling from the government.
DISCLAIMER: I am not a financial adviser. This site is for educational purposes only. It is imperative that you do your own research. I am sharing my opinion from personal research and experience with no guarantee of gains or losses on investments, finance etc.
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