Speaker 1: You know, a statistical air would be like two or
three percent. This is more like missing it by twenty
five percent. In my opinion, I think that that's fraudulent
given the fact that we are in an election year
and we find ourselves having rallied to new all time
highs as a result of you know, these false reads
that we've been consistently getting from the government numbers here,
so the only thing consistent about them is revisions that follow.
Speaker 2: You are listening to Carrie.
Speaker 3: Let'sa's Financial Survival Network where you get valuable information you
just can't find anywhere else to thrive in today's trying times.
You need the Financial Survival Network now more than ever.
Go to Financial Survivalnetwork dot com and get your free
newsletter and gift. Financial Survival Network now more than ever.
Speaker 4: Welcome you are listening to and watching the Financial Survivor Network.
I'm your host, Carrie Lutz. Well, hey, we got some
rate cuts coming because it seems like they made a
little mistake at the Bureau of Labor Statistics and they're
only off by eight hundred and eighteen thousand jobs. You know,
the more cynical among us, David would say that they
were patting the job numbers, and the less cynecal would say,
oh gee, stuff happens, right.
Speaker 1: Yeah, Well, you know, a statistical air would be like
two or three percent. This is more like missing it
by twenty five percent. In my opinion, I think that
that's fraudulent, given the fact that we are in an
election year and we find ourselves having rallied to new
all time highs as a result of you know, these
false reads that we've been consistently getting from the government
numbers here, So the only thing consistent about them is
revisions that.
Speaker 2: Follow Why would they do such a thing.
Speaker 1: Well, of course, you know, we are in a in
a very important year and as you look at elections
and everything else. Uh, they they're obviously trying to keep
things as peaceful as possible.
Speaker 2: Uh.
Speaker 1: And that includes Jerome Pewell not even talking to Congress
about their print and spend issues. So you know, we're
still let Jerry's out on that one, I.
Speaker 4: Guess, And some insider leaked to something or other that
uh that Powell uh hates Trump and wants to wants well,
wanted to see Biden get re elected.
Speaker 5: And then uh, now I guess he's all in for Kamala. Right, Yeah,
I guess that's the uh, that's the that's the narrative
going around right now, you know. And it's such a
challenging thing because of course the FED Commissioner supposed to
be politically neutral, meaning that they're not supposed to be
doing things for those who are getting elect did what
he has misstated though, and I think it's important to
draw this emphasis, is that he's misstated that him not
talking to Congress is being a political Well, actually, you're
supposed to talk to Congress, mister Powell. That is your
job to.
Speaker 1: Let them know that your economics are being messed up
by their economic policies and the print and spend and
everything that's going on. Milton Freeman showed us that it
is literally the cause of inflation is this print and
spend politics. So part of what I want to share
with you here today is that I do not think
inflations under control.
Speaker 2: I think it's going to be going in checked out
of control.
Speaker 1: And this next Fed the rate cut is about to
just spiral things in a big way.
Speaker 4: All right, So how much are they going to cut,
when are they going to cut? And how good is
that for the stock market? Because that's all they care about.
Speaker 1: Nailed it well first addressing when are they going to cut?
How much are they going to cut? The big thing
that the set has been concerned about is rate cuts,
and the reason for that is that in the late
seventies they cut too early and this led to you know,
we saw the recession and then inflation came back, and
then Arthur Burns had to show up and really just
had to stomp that thing down. So I think about
inflation kind of like as a as a fire. Okay,
right now, we've got smoldering ashes. But you know, you
and I could be camping, go to sleep, and then
wake up in the morning, start kicking around some of
those those ashes, and put some new timber on there.
It's going to light right back up again. Inflation is
a smoldering thing. Arthur Burns had to stomp this thing out.
Jerome pal has not stomped this thing out. He has
not gone to extreme levels. And in fact, the data
is even leading us to say that things are getting
a lot weaker right now, which is not really a
great way to actually be cutting.
Speaker 2: So how much will they be cutting?
Speaker 1: I think that the FED has to stay higher for longer,
and so I think that they're not going to be
cutting more than twenty five basis points. I mean, you
might see a fifty here right off the bat or
at a point in time where things where the data
gets work. But a couple things to understand with this,
and that is number one, when they cut, this is
actually going.
Speaker 2: To make the US dollar weaker.
Speaker 1: Okay, and so if we're talking about inflation, that's an
inflationary idea. Why because it's going to take more US
dollars to buy the same amount of goods and services,
et cetera as.
Speaker 2: We did before.
Speaker 1: And so and so this is a really important point
to make because you know, really when when when we
started hiking rate, that made the US dollar twenty five
percent stronger than where it was before. That's actually a
big reason why we went from nine percent inflation down
to the lower places where we are today. It's because
the US dollar got stronger. We're about to do the
exact opposite thing to the dollar. As my first point
here in noting that.
Speaker 4: Yeah, interestingly enough, you know the dollar has been getting weaker.
I haven't looked at it today, but I will look
at it now. It was down to right around one
hundred yesterday. That was up from one eight and you know,
up from the teens last year. Now, according to a
psycho analyst guy who is a regular guest on the show,
and you can take this for what it's worth, he
says that a weaker dollar generally portends a Republican being elected,
and a stronger dollar portends a Democrat being elected.
Speaker 1: What do you think about that, Well, I think politically speaking,
the Republican Party is the party at least right now
that is for sure coming up with ideas about how
to get us out of this, you know. So one
of the things that we need to understand is that
how do we get out of it is going to
be supply side economics. AI is going to be really
low cost supply side economics, but at the cost of
everyone else's job or many jobs anyway, millions at the
same time. So when when you talk about deregulation or
rest less regulation, when you talk about you know, getting
a more balanced type of a system and approach different
stimulative type of policy, you know, those are the key
things here. So the Demots are ultimately looking at raising
taxes and buying boats right now, and that is a
crazy crazy platform to me running on.
Speaker 4: All right, So, speaking of AI, I just said, I'm
going to solve the budget problem. I'm going to have
chat GPT do a line by line analysis of the
twenty twenty five budget and cut out three point two
trillion dollars from the budget. And wow, the first thing
it did was they wanted to raise taxes. It didn't
care about cutting anything. So it sounds like reminiscent of
some of our members of Congress there So then I said,
under no circumstances can you raise taxes. It al must
come from spending. And you know it found three point
two trillion. I mean, listen to this, like defense reductions
eight hundred billion over the next decade, corporate welfare cuts
hundred billion, and you could do a lot more than that, really,
because it's three hundred and fifty billion a year. Healthcare
spending cuts seven hundred billion, And that's not cutting back
on anyone's healthcare somewhat. It's like cutting back on Medicare
advantage over payments. All right, it's one hundred and fifty billion,
Negotiating drug prices two hundred and fifty billion, Medicaid eligibility
reform two hundred billion, and preventive care programs, expanding them
like RFK Junior make America Healthy Again one hundred billion.
Speaker 2: I think it could be far more than that. And
then getting rid of a.
Speaker 4: Ten percent of the federal workforce, which no one would
even notice. One hundred and fifty billion, two hundred billion
agency consolidation. So anyway, we go on and on. They
want to raise the retirement aged seventy. I'm kind of
opposed to that, but I understand it's got to come someplace.
So I said, find at least one hundred agencies that
could be erased put out of business, you know, and
I got to find it now.
Speaker 2: I wanted to get these are fascinating.
Speaker 4: The F thirty five Joint Strike Fighter program. Okay, So
I mean, here's one guy sitting in his in his office,
and I did more to control the deficit with one
query than the Congress has done in the past twenty years.
Speaker 1: Here, David, well, you know, it's it's not rocket science,
but I guess AI can figure it out about thirty
two seconds. Yeah, you know, here as far as at
least some ideas, and then that gets the discussion conversation going.
Speaker 2: Here.
Speaker 1: Yeah, you know, there's a lot of things that we
need to be figuring out. If you look at the
actual expenses for Medicare and Social Security, that's exceeding sixty
percent of the entire federal budget, the amount of money
that's coming in from AX receipts, and so we're just
at the pinnacle year right now. Twenty twenty four is
a year where the most baby boomers reach age sixty
five and enter into retirement. And so why is that important? Well,
the system's already expensive, it's already swelling, and we've got
the biggest group going in right now. It's like fourteen
four hundred a day right now. So you know, there's
definitely going to need to be some changes, and I
think that we need to encourage our political leaders to
have the conversations this is these are the things that
we actually want because our future depends on this. I mean,
I have five young kids that are you know, going
to be growing up, likely in a world very different
than the world that I knew growing up. Just given
the significance of deficit spending that's going on. I think
that we've added about twelve trillion dollars here in the
last four years, so you know, it took us two
hundred and thirty years to get in the first you know,
eleven trillion. We just put on twelve here in the
last four So this is a runaway time that.
Speaker 2: I do not just stop in anytime.
Speaker 4: Soone, all right, so listen to what we can get
rid of the Department of Education, Department of Energy, Department
of Commerce, and so then we won't have to worry
about those job numbers being askew because they're responsible for it.
The Department of Housing and Urban Development. Just give the
money to state governments and let them handle it. National
Endowments for the Arts, the Humanities Corporation for Public Broadcasting,
privatize it, xmbank, which is just corporate welfare. The Appalachian
Regional Commission. Listen to some of these, the Denali Commission,
the FCC, probably get rid of that. The Federal Maritime
Commission officed a thrift supervision, the US International Development Finance Corporate.
I mean it goes on and on here. Some of
these I didn't even know existed, Like yeah, it's just like, hey,
they're saying, get rid of the Bureau of Alcohol, Tobacco
and Firearms consolidated.
Speaker 2: With the FBI.
Speaker 4: I mean you know, it's it's craziness here, the Rural
Utilities Service, and then you know, I just it didn't
give the savings this time. The US Institute for Peace,
they're doing a really rotten job.
Speaker 2: Let's get rid of them.
Speaker 4: The Commission on International Religious Freedom, the US Chemical Safety Board,
the State Justice Institute, you know, all these insane company
agencies here that do absolutely nothing for us.
Speaker 1: And yet you know what's amazing is there's more people
right now that are courting our congress members for you know,
these these these backdoor deals, this port barrel spending, all
these extra little things that are added to every single
bill essentially that's coming through, and we just get this
extremely bloated government. So, you know, I don't think it's
a bad idea for people to be asking questions like this.
In fact, I would say, if there's a silencing voice
that's trying to say, don't even talk about stuff like that,
we might actually think to ourselves, is this a voice
that's trying to control me? Are they actually trying to
consider give me to independently conductor? What's going on right now?
Are they just trying to get me to comply? So
that's a you know good little, good little exercise. It
kind of fun to see all the different things that
are going on there.
Speaker 4: Here's what was zille. You never knew about the Office
of Navajo and Hope, Indian Relocation. They blow through fifteen
million a year. The Office of Federal Contract Compliance Programs
one hundred and five million. You know, Yeah, it just
goes on and on and on and on here. It's
unbelievable that all these agencies that really do absolutely nothing
right well.
Speaker 1: Right, and so to your point, you know, all this
is inflationary. This costs the taxpayer money, right, and so
the taxpayers are here on the hook, and of course
they don't even stick to a normal budget. They blow
their budget easily every single year. No problem. By the way,
that is literally taxing us. It's just the tax of
least resistance because it's inflating our dollars. And we're going
to be finding ourselves in a very challenging time here
with those rate cuts that are going to be coming.
But just to kind of get back to these couple
of points, the second way that inflation happens with these
rate cuts is that, yes, it's going to have a
melt up in the prices of our stocks in our
real estate and so you get lower rates.
Speaker 2: Of course, that's going to be better for tech stocks.
Speaker 1: Through the roof, it's going to be better for real
estates already at all time eyes right now. And you know,
here's the deal, we're also cutting right now while we're
at all time eyes. Statistically, we have had a recession
one hundred percent of the time when we have specifically
done that. But this is going to cause the price
of everything to go high. Of course, that's inflationary. And
if you look at this melt up melt down concept,
Japan actually did this in the in the eighties, and
the Nike their their exchange actually didn't just hit a
high until you know, earlier this year. It was almost
forty years to get back up to a high. So
we might be finding ourselves in a melt up moment
that we may not get back to for potentially decades
of times as this goes on.
Speaker 2: Yeah, you're right.
Speaker 4: Talk about real estate, the housing, the builders, the home
builders have record highs, you know, right, all time record highs.
Speaker 2: What does that tell you? It tells me.
Speaker 1: That they're giving incentives for the new home that the
person that's selling their home that's already existed cannot get
and so you know, these these are timeframes right now
that numbers are not operating the same way as they
used to, and in fact, I think it's going to
continue to progress and get worse, because my point three
is that the Japanese carry trade is actually going to
be getting worse and it's going to be unwinding a
lot of the leverage globally that we've seen. So what
is the Japanese carry trade? Basically seven point thirty one?
Japan raise rates a quarter point. Now, that's nothing, that
was the smallest rays of them just did, but that
it's a deal for a society for twenty years that
hasn't raised really at all. And so what happened is
they had to come to the rescue. It's hundreds of
billions of dollars to stabilize their market. Well, what's going
to take place right now is that as the United
States is cutting rates, that's going to make our dollar weeker,
while Japan's raising rates that makes their dollars stronger, that
makes their carry trade worse, meaning the amount of money
that was borrowed does not go as far in the
thing that's now being leveraged against like US treasury, US stocks,
et cetera. So I expect a lot more volatility as
the year continues to to unfold because of people unwinding
these trades and the reality that this cutting FED is
going to make this far worse for Japan. And I
looked up a statistic this morning. There are four hundred
or sorry, four point five to two trillion dollars invested
by the Japanese people and this is these are not
not the government, and more than half of that is
by the people is in long dated debt, literally intra
sensitive debt that's going to potentially need to be unwound
as this carry trade continues to get worse because the
US dropping rates, I think that Japan could literally unwind
the entire global economy if we're not too careful here,
because we are literally all tethered together climbing this mountain.
If one falls, we got to put our ice pits
in and stop this thing from going backwards.
Speaker 2: It's it's getting close, ay, you.
Speaker 4: Know, the only kick the can down the road so
far until you want run out of road, right.
Speaker 1: Exactly exactly. Speaking of running out of road, my fourth
point is is that you know, the world's now running
from federal treasuries in other words, IOUs on US dollars
to more safe, avent type of ideas right now. So
we're seeing a broadening in the market. We're seeing gold
obviously go above twenty five hundred stay above twenty five hundred.
Silver's made a massive move. I expect silver, by the way,
to continue to ride here and surpassed gold as a
finished year out. But the central Bank has big dilemmas
right now because you're trying to figure out how to
preserve value today with the day's money in order to
buy tomorrow's goods. And so what they're having to do
is buy gold and silver because that's the only thing
that's going to keep up its value relative to commodities
to electrify, etc.
Speaker 4: You got it, and the coppers back over for bucks.
Speaker 2: Yep.
Speaker 1: You.
Speaker 4: Oil has been holding up pretty good, even if the
demand is it's impossible to really gauge demand because global market.
You know, people are driving more here, they're driving less
there as you really don't know, but exceon I think
put out a projection that the amount of petroleum used
is going to stay constant for the next twenty five years.
Speaker 2: Oh yeah, well, what's all the where's all the electrification?
How can this be?
Speaker 1: Can't be electrifications changing, It has to change. I think
more we're going to be seeing more of a hybrid type.
Speaker 2: Of an engine model.
Speaker 1: I think Toyota has a really really good prototype that's
coming out right now. But no question, we are petroleum based.
We're going to continue to be, and that's a good
thing for the United States. And if President Trump gets
back in, drill, baby, drill is what he continues to say.
And you know, the United States does it cleaner and
safer than anyone else in the world, not cheaper, the
cleaner and safer in the United States. We value those
two ideas, and the United States more oil than anybody
else right now. So that is a very deflationary idea
if we can produce more supply and also takes some
of the strength away from Russia and Saudi Arabia, who
are in lockstep as number two and three oil producers
in competition with US here. And so of course Russia
can't wage war unless oil traces remain elevated. So there's
a number of things that we can do in the
United States if we so chose.
Speaker 4: To do them, and don't forget that gas. We have
more that gas than any buts in the world, to
the point where some of it even still to this
day gets flared off on the fields.
Speaker 2: Literally when you see.
Speaker 4: Those giant flames when you're going by a field that's
flaring because it got too much gas and there's no pipelines.
Speaker 2: You can't build pipelines, not gas.
Speaker 4: You'd think they'd be pushing that because everybody should have
that gas. And you've got these crazy states banning gas stoves,
banning natural gas, pipelines, hookups, all this. Yeah, so hey,
we're seeing that happen. We're seeing the central banks buying gold.
You know, how much longer can it go on?
Speaker 2: Good question?
Speaker 1: As I'm looking forward here again, I think that we're
going to have a much choppier end of the year
as we move into twenty five. You know, there's a
number of ways to really juice the market. I think
that we're going to see the statistics start to fall
apart and interventions have to start coming in. And so
there's a gauntlet ahead of us as we head into
this election. I mean, we've got COVID two point zero
that's likely to come we've got, you know, Kamala and
Trump are going to start debating. I mean, Kamala has
now had about three weeks of a facelift to her profile,
and even though she's never won a single primary vote,
she's never even.
Speaker 2: Made it to Iowa.
Speaker 1: She didn't even make it past the first round last primary.
She's the horse that's running here. And so, you know,
I think that this is a gift to the Republican
Party candidly, because as the president goes, that's likely to
be the way that the House goes. I think the
Congress you could actually see a sweep here coming at
the end of the year. And that's, of course, if
elections remain normal, we don't get into World War three,
all these crazy geopolitical events erupt all over the world.
Speaker 4: So it's anyone's guess. But but when we're looking looking
at this, do you think the market's got it baked
in the cake that Trump is going to win.
Speaker 1: I do think that the market is expecting that Trump
is going to win, which is going to be positive,
and I think the sentiment of that is going to
continue as we move forward here into September. You know,
we're looking for leadership change, I think everyone's recognizing that
Kamala was the most unliked vice president that we've ever had,
I think, and at least as far as the pollings
go back. And so I do not believe that she's
going to be able to turn this thing and get it.
So Trump has the lead. He's got the RNC that
looks more united than I guess anytime I've ever seen it.
So looking at the differences and messaging between kind of
the DNC, which was really about hate and against and
against and against that telling us necessarily what they're for
or how they're going to do something. I think that
America is going to look past all that. They're going
to recognize that we've got one way forward right now.
And this is a time when it is not a
moment to be complacent. This is a game on need
to make some things happen. We need somebody in there
that has a business mind and has the ability to
not just try to get votes, which you know, of course,
no one's even running our government right now, they're just
running for politics.
Speaker 2: We need people that are you know, burying the line
and and a standard here.
Speaker 1: So I think that I think the market will price
that in and we will ultimately see that, but it
could be.
Speaker 2: A crazy, crazy uh rest of the year.
Speaker 4: M all right, so uh yeah, it's it's definitely going
to be.
Speaker 5: Uh.
Speaker 4: I mean, like, we don't get into politics here because
it is a family, you know, a show after all. Well,
you know, this is the most insane election that I
have ever seen in a in every way.
Speaker 1: So Jerry, the way I like to say it is,
you know, when political science affects my science with his economics,
I should have an answer. And so we need to
understand how two different ideas can mesh together and how
they affect each other. And they really are one one
right now. There's just you know, so closely aligned because
of how the Fed's being run, because of all the
pressures that are put on all these different things and
where things are going. So the American people need to
get informed.
Speaker 2: They need to.
Speaker 1: Continue to read and not just take a bunch of opinions.
That's the hard part is that you know, depending on
the channels that you look at and watch, you know,
there's so many negative opinions about everything that's going on
out there. And here's my point. I think that this
is really important to understand. But let's figure out the
things that we can do that are going to position
us for the future. Those things that we can do,
we can get the right risk of versification, the right
strategies in place right now that are going to really
benefit us as the economy changes and things turn. And
then also tax diversification is massive because when inflation goes up,
when this debt and deficit continues to rise, they're going
to have to tax us.
Speaker 2: I'm a radical about this.
Speaker 1: More than one third of America's wealth as in baby,
when we're score one case and I raised, they have
not paid a penny in tax.
Speaker 2: Yet many do not have an answer. They don't know.
Speaker 1: And you know, for better or worse, how they plan
their future today is what they're going to get tomorrow.
Speaker 2: Yeah, whether you like it or not, you're going to
get it.
Speaker 4: Yep, that's right, all right, So be prepared like a
good boy, scoff. And that's what you need.
Speaker 1: To do, right, Yeah, absolutely, you know you need to
have a parachute before you before you get on the plane, right. So,
you know, I think it's important for people to be
paying attention right now to to where they are. You know,
it's it's kind of like most of the economic data
careas we've talked about in the past, is looking through.
Speaker 2: The rearview mirror.
Speaker 1: Rearview mirror driving does not work out well. We need
to be windshield present, and so I think it's important
to look at leading economic indicators where we're going manufacturing, unemployment.
We just talked about that trend. These are very important ideas.
People need to be paying attention because these statistics could
fall apart really fast and cause tremendous heartburns for the
market and investors that are entering or near in retirement
right now.
Speaker 4: Hey, one thing I want to cover. It's not financially related,
but to me, the biggest shocker of this election, okay,
of RFK Junior getting into it, make America healthy again.
Speaker 2: You know that.
Speaker 4: It just amazed me to hear that, because it's so
obvious wood supply has turned into poison and and lots
of bad stuff there. And the health of our children.
You say, you have young kids. Uh, this is the
kind of thing you should really be, uh be concerned about.
You know.
Speaker 2: Yeah, my wife was.
Speaker 1: We were just in Europe and my wife has a
little bit of a gluten sensitivity.
Speaker 2: She ate the bread.
Speaker 1: No problem one is whatever she's going home right now
and she's like, I gotta find the right wheat berries
and to be able to make my own bread because
this was soodmo non jamo and so uh No, there's
no question that that that we have a lot of
things right now that I think that we need to assess.
And uh uh so why are we not having those conversations. Well,
I just think that there's a lot of other priorities
that we the people haven't necessarily mandated, uh that that
people be talking about. So uh, let's just pray that
politicians will understand who they represent.
Speaker 2: Uh.
Speaker 1: Let's hope that right now that you know, the people
of the United States can step up and say, you know,
this is this is our nation. After all, this thing
is not going the direction that we're looking for. And
it is very concerning to see all these things like immigration.
I mean, last point, Carrie, you know we were told this.
You know, the government statistics on unemployment were so accurate.
What else are they lying about? Oh, the border's safe
and secure, Oh about it, a soft landings coming anytime soon?
Inflations that I mean, these are huge, huge, huge statements
that I believe next twelve months, we are going to
see completely deteriorate, move backward, and we're going to say,
holy smokes, what do we do now?
Speaker 2: Yeah?
Speaker 4: Well, hey, to me, like making nutrition and health number
one issue, because twenty percent of our GDP goes to
trying to patch people up after they've destroyed their body.
It's true, And eighty percent of all expenditures take place
with her what are called the lifestyle diseases. When it's smoking,
it's obesity, it's uh, you know, high stress. People don't
all these things. And to make that an election issue
and take on big pharma and big ag and and
all of that, you know, he's done something amazing here.
I personally despise the guy for a variety of personal
reasons I won't go into. I knew him from New York,
but while doing this pretty amazing.
Speaker 1: Yeah, I think he's probably going to get a spot
in Trump's cabinet as a result of it. And that
shows Trump's bipartisan nature and wanting to work across the aisle.
And I think R probably represents more along the line
what traditional liberals were. I mean, this is Bobby Flippin' Kennedy.
After all, the guy's got the name, he's got the
D and I guess it would you know, the Independent,
But he had it all and the party has changed
and it has gone a different rest direction. I like
to say this election is balloon no matter who or
red Tell him Dad, those are the two opinions.
Speaker 4: Yeah, well somewhere, But you know, I think things are changing.
The political realignment's taking place where we realize existential issues
trump everything else, no pun intended. And I think that's
what we're going to see. David, just tell us how
do we connect with you? How do we find you
on the web?
Speaker 1: Yeah, hey, Stedbubble dot com is a great way to
get to know me and what's going on. Got some
good information out there, got classes that are coming up
here as the year is ending on Medicare, social Security,
JAX is retirement planning. So that's that's that's kind of
what we got going on right now. And welcome anybody
to get some downloads off our website.
Speaker 4: All right, and you'll find a link in the show
notes to this interview on Financial Survival Network dot com
and just click it take you to David's site. While
you're there, would you please sign up for our free
newsletter got a question for David myself, klatcarrilots dot com.
Speaker 2: Is the email address. Always a pleasure to have you on, David.
We'll talk to you again real soon, Gary Pleasures mind
take Eric talking.
Speaker 3: So thanks for listening to Carrie Letz's Financial Survival Network,
your solution to today's trying times. For the latest, go
to Financial Survivalnetwork dot com. Financial Survival Network now more
than ever,