Watch Out! They’re LYING To You About Inflation & The Economy!!

Inflation is coming down wages are Rising unemployment is at historic lows The economy is booming savings are at Record highs the markets are rallying This is what the fourth branch of Government aka the media has been saying For months but with each passing day It's becoming harder and harder to Believe and for good reason Today we're going to tell you what's Really been going on with inflation Wages savings the economy unemployment And the markets and why the people in Power appear to be gaslighting us about Them According to most official inflation Measures around the world inflation has Come down from the multi-decade highs it Hit last summer the thing is that this Drop in inflation isn't happening Everywhere declining inflation doesn't Mean declining prices and official Inflation measures aren't always Accurate for context there are Technically two numbers for most Inflation measures the headline number Which you see in the news and the core Number which the news doesn't seem to Talk about much The headline number includes food and Energy whereas the core number excludes Food and energy if you're wondering why The answer is that food and energy are Extremely volatile meaning that their

Prices can change significantly from Month to month This makes for bad Optics when headline Inflation is rising but it makes for Very good Optics when headline inflation Is coming down like it is now Take the US Consumer Price Index or CPI For example headline CPI has been Falling fast and appears to be on the Brink of falling below three percent Which is certainly good news As you can see however the core CPI Seems to be stuck at around five percent Which is obviously not good news if you Watched our recent summary of the Central Banking Summit AT Jackson Hole You'll know that around half of core CPI Comes from non-housing services so think Restaurants hotels mechanics Etc The other half of course CPI is made up Of goods like phones and computers and Housing Services like rent How much each component of core CPI is Affecting you personally ultimately Depends on where you live if you live in A metropolis like New York City then Chances are you have higher rent costs If you live in a rural area then chances Are you have higher Goods inflation due To more expensive Supply chains If you're living in an area that's no Longer experiencing High inflation due To these factors then chances are that The prices of goods services and rents

Haven't come down nearly as much as You'd expect in fact it's possible if Not likely that the costs of all the Above are still increasing albeit much Slower this is simply because lower Inflation does not mean disinflation For the sake of Simplicity you can say That inflation means price is going up And disinflation means price is going Down if you experienced 10 inflation Last year and inflation is back down to Two percent then it means that prices Are still up around 12 percent but of Course this all assumes that the Official inflation measures are accurate And representative of what you spend Your money on each month As a not so fun fact many inflation Measures such as the CPI have been Revised many times over the years if you Use the older measures inflation is much Higher you can learn more about how the CPI is calculated and why it's not Exactly accurate using the link in the Description Now this ties into the second clay being Made by the media and that's that wages Are rising according to trading Economics wages in the US are currently Rising at an average of around five Percent wages in the UK are rising at an Average of around eight percent and Wages in the Eurozone are rising at an Average of around 4.5 percent at first

Glance this is good news because it Means people are making more money upon Closer inspection however you realize That these wage gains are barely keeping Up with inflation not only that but These wage gains are not Universal some Occupations and industries have seen Different gains you'll recall that core Inflation in the US is at around five Percent this means that the actual Average wage increase in the US is Barely keeping up with inflation the Same is true in the UK where core Inflation is around seven percent versus Eight percent wage gains and in the Eurozone where core inflation is over Five percent versus 4.5 wage gains Ouch now you'll remember that most of The core inflation in the US is coming From non-housing Services logically then These are the areas that have likely Seen the largest wage gains the example That comes to mind here is U.S UPS Workers who got wage increases of Between 17 and 55 percent as part of a Recent deal if you're lucky or rather Unlucky enough to work in Investment Banking however then chances are that You've received a significant cut to Your annual bonus For reference annual bonuses make up as Much as 50 percent of the salaries of Investment bankers a bonus cut of 50 Therefore means a pay cut of 25

Yikes now logically changes in wage Gains can and often do lead to changes In inflation as a matter of fact the fed And other central banks were initially Concerned that high wages would lead to More consumption which would result in Rising prices and higher wages Eventually resulting in higher inflation This is called the wage price spiral and The good news is that the fed and other Central banks aren't that concerned About it at least for now if you think About it though the fact that they're Not concerned about a wage price spiral Could be bad news because it means that The opposite could happen Oddly enough there isn't an official Term for this opposite scenario Bloomberg refers to it as a quote Reverse wage price spiral as you might Have guessed this is when wages decline Which results in less consumption which Leads to Falling prices and lower wages And so on and so forth typically this is Associated with recession wherein Millions of people lose their jobs but The media claims that it could be Possible for wages and prices to decline Without causing job losses the thing is That the fed and other central banks are Not so subtly trying to cause job losses To cool inflation This relates to the third claim being Made by the media and that that

Unemployment is at historic lows for Those unfamiliar unemployment measures The percentage of people who are looking For work but are unable to find it this Figure does not include unemployed People who aren't looking for work Similarly to inflation measures Unemployment measures are often broken Down into two buckets General Unemployment and youth unemployment one Of the differences is that unemployment Measures are often revised as additional Data about employment is discovered or Recounted case in point the U.S Bureau Of Labor Statistics recently revised its Unemployment statistics and found that Unemployment was much higher than Initially calculated even so Unemployment in the U.S remains at Multi-decade lows of under four percent Which is the fed's target but that's Just the headline figure The youth unemployment rate in the US Has been rising fast since April and is Rapidly approaching nine percent more Importantly if you zoom out it looks Like the beginning of a reversal of a Long-term downtrend in other words it Looks like youth unemployment in the US Is about to start Rising for a prolonged Period What's interesting is that this reversal In youth unemployment appears to have Occurred because of the banking crisis

Which happened in March now this would Make sense considering that small and Medium-sized businesses are often the Ones which hire young and inexperienced Workers to clarify the banking crisis Has caused Banks particularly small and Medium-sized Banks to be more careful With who they lend to as it so happens Small and medium-sized banks give most Of their loans to small and medium-sized Businesses fewer loans therefore means Higher youth unemployment Now there are many reasons why youth Unemployment is significant for starters It can be an indicator of higher Unemployment in other age groups if Youth unemployment stays too high for Too long it can also result in a decline In long-term productivity due to a lack Of work experience however the biggest Reason why the youth unemployment rate Is significant is because it's Considered to be a precursor to social Unrest and even Civil War it's believed That high levels of youth unemployment Played a key role in the Arab Spring the Russian Civil War and even the French Revolution That's probably why Chinese authorities Recently decided to stop publishing Their youth unemployment statistics Youth unemployment in China is Reportedly over 20 percent and that's According to the official statistics

Like inflation it's possible if not Likely that the actual youth Unemployment rate is much higher but as With inflation it's not the number that Matters but the direction it's going and How fast it's going there as I mentioned A few moments ago youth unemployment Appears to be rising fast it looks like The general unemployment rate is Starting to follow suit but it's too Soon to say if General unemployment does Follow in the footsteps of youth Unemployment then it could soon surpass The aforementioned four percent Target Set by the fed and some other central Banks it's believed that this will force Them to lower interest rates but this Likely depends on how much it impacts The economy this pertains to the fourth Claim being made by the media and that's That the economy is strong and that the Consumer is resilient in case I didn't Make it clear enough economic growth Fundamentally depends on consumption if People consume the economy is strong if They don't the economy is weak That's why the consumer sentiment index Is another measure that economists and Investors watch very closely naturally The more confident consumers are feeling About the economy the more likely they Are to spend money where consumer Confidence is headed depends on what Factors are driving it for example in

The U.S consumer sentiment has been Rising since the start of the year but It saw its biggest drop in two years Last month much more than was forecast The drop was due to a combination of Concerns around Rising inflation a Deteriorating labor market and higher Borrowing costs funnily enough those are The three factors we analyzed earlier in The video now similarly to the youth Unemployment rate the consumer sentiment Index paints a very concerning picture When you zoom out the last time the Index was hovering this low was around The 2008 financial crisis in fact it hit An even lower level last year which Makes sense given what was going on at The time in case you've forgotten last Year inflation was in the double digits In most countries and central banks were Raising interest rates at record speeds To try and fight this inflation this Resulted in a double whammy for Consumers more expensive goods and Services and more expensive debt Payments the Silver Lining was that the Increase in interest rates was Concentrated among shorter term interest Rates FYI short term interest rates are The only ones that Banks can influence What's different this time around is That it's the longer term interest rates That are rising and these are influenced By the markets moreover longer term

Interest rates directly influence the Interest rates on other forms of longer Term debt such as mortgages As some of you may have heard mortgage Rates in the US recently hit their Highest levels in over two decades That's despite the fact that the FED is Probably done raising rates so this begs The question of why longer-term interest Rates are rising and the answer seems to Be because investors believe that Inflation will stay higher for longer as A result they demand that interest rates On longer term debt be higher to Compensate for the inflation kind of Like what's happening with wages Now the silver lining in this case is That most mortgages are fixed and long Term at least in the US this means that A change in mortgage rates will only Impact those who are trying to buy new Homes for countries with shorter term Fixed mortgages like the UK Rising Mortgage rates means people will lose Their homes It's safe to say that losing your home Doesn't Inspire consumer confidence the Index for the UK fell sharply below 2008 Levels a couple of months ago and has Barely recovered the worst part is that Mortgages aren't the only debts that People have credit card debts have been Reaching record highs in many countries Over the last year with U.S consumers

Racking up over one trillion dollars Worth if you own a credit card you'll Know that the interest rates on these Debts are very high and they can go even Higher when interest rates and inflation Rise Double whammy Now the fifth claim being made by the Media follows on from the fourth and That's that savings are at record highs Now this is easily the most Controversial claim being made by the Media which has posited that all the Pandemic stimulus and rate Cuts made it Possible for every person to fill up Their piggy bank As with all the statistics discussed so Far the devil is in the details According to some sources there are Trillions of dollars of excess savings Out there somewhere when you dig deeper Into the data however you realize that These savings are heavily concentrated Among wealthy individuals and Institutions this wealth is becoming Even more concentrated because of higher Interest rates because those with large Cash piles can earn a high yield by Investing in U.S government debt some Economists believe that high interest Rates are paradoxically resulting in Higher inflation because of all this Passive income meanwhile the average Person has in fact depleted their

Savings according to the U.S household Saving rate personal savings are at the Lowest levels they've been since the Early 2000s it's believed that this is a Big part of why credit card balances Have risen so much over the last year Another handy statistic to assess the Actual savings rate is how many people Are living paycheck to paycheck well Just recently it was revealed that Around 61 of Americans are doing just That to put things into perspective this Is an increase of two percent over the Last year as with all the other Statistics discussed so far the Direction and the rate of change are What's important if we extrapolate a two Percent increase for the next two to Three years which seems probable given The circumstances this means that more Than two-thirds of Americans could soon Be living from paycheck to paycheck This happens to be consistent with the Recent excess savings assessment by the San Francisco branch of the FED it found That there are fewer than 200 billion Dollars of excess savings remaining to Put things into perspective it was 500 Billion at the start of the Year this Means excess savings could run out soon And that means that Americans are likely To take on even more debt to try and Keep up with the rising cost of living It goes without saying that this will

Take an immense emotional toll it's a Feeling that many of us are familiar With no matter how hard you work you Just can't seem to get ahead this Hopelessness can and often does increase The propensity to YOLO whatever money is Left into crypto and meme stocks lo and Behold the so-called retail Army has Reportedly been betting record amounts Of money on single stocks 1.5 billion Dollars in a single week back in June While it's not the most prudent thing to Do you can understand their desperation Why spend a few hundred dollars paying Down unpayable debts when you can take a Punt on a meme stock that might come Good and help you pay back all of your Debts For them saving money seems to be a Futile Endeavor with high inflation and High interest rates Now this connects to another claim being Made by the media and that's that the Markets are rallying believe it or not But this claim isn't entirely accurate Either don't get me wrong stocks have Been rallying like crazy since the start Of the year The thing is that it's just been a Handful of companies only around half a Dozen stocks have been rallying since The start of the Year namely tech stocks This has pulled up stock market indices Such as the S P 500 even though the

Other 494 stocks in the index have been Trading sideways like the inflation Dynamics I mentioned earlier a true bull Market also requires bullish catalysts To keep it going Catalysts can be grouped into macro Factors and stock specific factors from Our perspective neither are looking Particularly promising in the short to Medium term On the macro Factor front there are Concerns of inflation Rising interest Rates staying higher for longer Unemployment increasing and consumer Confidence and spending coming down by Now you'll know that these concerns are More than Justified some would say They're in full swing already On the stock specific Factor front Meanwhile there are concerns about Declining earnings which are guaranteed If inflation Rises interest rates stay Higher for longer and consumer Confidence and spending come down note That many retailers like Target reported Their first sales declines in years and Are forecasting further declines but as We've seen the thing that's been driving The markets the most these days is Narrative in stocks The Narrative has Been AI which will bring about huge Productivity gains and increase earnings So long as evidence for this narrative Continues to come in then stocks could

Very well continue to Rally even if the Real fundamentals continue to Deteriorate The catch is that if these narratives Happen to fall apart then the rally will Turn into a crash and the fundamentals Will kick in let's just say that it's Just as easy to make a narrative as it Is to break it so with all that said why Do the people in power appear to be Gaslighting us about all of this Well the short answer is something I Talked about earlier social unrest if The average person realized just how bad It was then the people in power well Would not be in power for much longer The rise in populism we've seen around The world is a consequence of this fact And it's a trend that's likely to Continue so long as times are tough the Scariest part of it is that the people In power are trying to infiltrate this Populism to ensure they stay in control Even when these supposed change occurs If they succeed then this effectively Guarantees that we will see history Repeat there will be a reckoning Everything will seem fixed and then it Will slowly start to fall apart again as The people in power return to their Previous ways some would say that human Corruption will cause this regardless That said however these volatile times Have the potential to offer enormous

Opportunities to those who pay attention Paying attention is admittedly difficult Especially when a lot of what you see in The news is propaganda and a lot of the Independent information you find is Often pretty depressing A bit like this video But make no mistake these next few years Are where the Future Leaders of the Private and public sectors will be Determined where Freedom can actually be Won and where wealth can be truly Accumulated so the first step is to Swallow the black pill of what's really Going on so that you can act Appropriately You'll find that the way you should act Is to do the opposite of what everyone Else is doing if everyone is investing Don't invest if everyone is spending Don't spend if everyone is borrowing Money don't borrow you'll be surprised At how much further ahead you'll get by Just not doing what the others are not Financial advice of course And it's not just what you do either It's what you pay attention to every day If everyone is paying attention to the Latest UFO story or similar ignore it And ask yourself what's really going on In the world Finding that information isn't easy but It can be found and once you find it You'll be on your way to success as

Morgan Creek capital's Mark yusko once Said quote focus is the greatest Superpower it's also a superpower that's Available to every single one of us Focus on the right things and you will Succeed And that's all for today's video folks If you found it informative smash that Like button to let us know if you want To get more informative content Subscribe to the channel and ping that Notification Bell if you want to help Inform others take a second to share This video with them If you happen to be a crypto bro or sis The coin Bureau deals page has deals and Discounts that you can't miss it's got Up to forty thousand dollars of airdrops And bonuses on the best crypto exchanges The biggest discounts on the best Hardware wallets and much more besides Link is in the description as always Thank you for watching and I'll see you Next time this is Guy signing off Thank you