Speaker 1: Everyone keeps telling us that inflation has gone down. It
has not gone down. Get that out of your head.
It has not gone down. It has slowed down, right,
And so we are still stacking. And it's called compound interest.
So the price of goods is compounding every single year.
And so you can sit here and say, no, inflation
has gone down, No it hasn't. It slowed down. It's
only up by you know, two and a half percent
over last year, but that's still over last year, which
was up like thirty percent over the following two years.
Speaker 2: You were listening to Carrie. Let'sa's Financial Survival Network where
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Speaker 3: Welcome you are listening to and watching the Financial Survival Network.
I'm your host, Carrie Lutts. Well, hey, election right around
the corner. We got great job numbers out. Everything's doing
well unless you live in a state that gets hurricanes,
in which case.
Speaker 4: Not so great.
Speaker 3: And how really these numbers, What is the FED going
to do next?
Speaker 4: All these questions and more.
Speaker 3: Eddie Gifford's with us tactivewealth dot com.
Speaker 4: Eddie, great to have you back on the show.
Speaker 3: If you got a question for Eddie or myself, shoot
me an email kl at Carrie LUTs dot com. So
it looks like we're in the colm before the storm,
both in Florida and the country.
Speaker 1: Yeah, definitely. You know, we're in this situation where it's
funny because you get one job print that's better than
expected and need just forget everything. This happened in the
last six months, right, I mean, like we've we had
a lot of good job prints all year long, and
then we had a dramatic and then all of a sudden,
we have a good job right when the election is
around the corner. Now, I don't know, it just kind
of strange to me that when we get like adjustments upward,
they're like, as there are two thousand, like very very
small like margin, right, But when we get the adjustments
down they're like significant, like like I mean we're talking
when they came forward and said, oh, sorry, you know,
we didn't actually create eight hundred thousand jobs. But it's okay,
because you know, the most recent print was good, so
that everything is good to get. And of course, the
interesting thing about it is that it really has caused
like an about base on the cuts from the standpoint
that there's like nobody expecting a fifty basis point cut
after that, and the treasury market is telling us that
the treasury market, I mean, gosh, the tenure got back
over four percent today even been there in forever. And
so that is concerning terry because you can have every
job right, you can have everything you want. You can
make it like China just did a really big stimulus.
We live in a global economy and a lot of
the things that are happening right now are more inflationary.
Speaker 3: Now.
Speaker 1: No one wants to talk about the fact that inflation
could come back, but it did it in the seventies.
I couldn't do it again, and why couldn't it be
worse than it was in twenty twenty tears? And I
think that's kind of when you actually look at it
and think about what could happen, you can't eliminate that possibility.
Speaker 3: Yeah, well, look, we've talked about it before. Inflation goes
in cycles. It doesn't just go away, and is Milton
Friedman one of the greatest economists of all time? The
question about it said, inflation is first and foremost a
monetary phenomena.
Speaker 4: Right, What did you get wrong Thereed?
Speaker 1: Oh, I mean, you're absolutely right. I think that the Well,
the funny thing about it is that we want inflation too.
You know, the FED is is always you know, targeting.
They're not targeting zero percent, right, they're targeting two percent.
And of course it on includes things like sugar in
the CPI. Why would they do that? It's it's only
every single thing that you can buy in a grocery
store nowadays. And so it's always interesting to see CPI
versus actual because I know the people that I talked
to every day right now, they're they're hurt by the
fact that they're maxed out on the credit card. And
guess what, a fifty basis point cut didn't really do
much for them. And the other thing is is that
like everyone keeps telling us that inflation has gone down,
it has not gone down. Get that out of your head.
It has not gone down. It has slowed down, right,
And so we are still stacking. And it's called compound interest.
So the price of goods is compounding every single year.
And so you can sit here and say, no, inflation
has gone down, No it hasn't. It slowed down. It's
only up by you know, two and a half percent
over last year, but that's still over last year, which
was up like thirty percent over the following two years.
And so we're at this just like breaking point. And
of course it's like on the cusp of the election.
And of course there's these storms happening that are inflationary,
right because now all of a sudden that can mess
with supply change and all of these things. And then oh,
guess what, we got wars and that causes the price
of oil to go up, which is also inflationary. And
so there's a lot of things that we can't control
that are going to have inflationary action. And then we
have the FED, which all they can do is control
that ding gray. And when you think about it, at
this point, with everybody being maxed out on credit cards anyways,
a rate hike might as well be considered inflationary because
it's just increasing the cost for the consumer. And so
like the only thing that fixes it is true demand destruction,
which is where we start talking about recession, talking about
S ANDP, going back to the twenty two letter rage. No,
that can't happen, Yes it can. It's happened. It's happened
two times in the last twenty five years, and so
it's cryptique.
Speaker 3: I'm going to tell you what I think is going
to happen now. The inflation. It's going to run its course,
assuming they don't tank the dollar, which would mean tanking
the entire global financial system, including the bricks they would
go with it, because all of our currency is fiant based.
But I feel we are in a similar position to
where we were in the nineties, and that was before
the advent of the Internet for most of us for
public consumption as being the greatest communication tool, networking tool,
and monetization tool ever created. And really I felt like
that brought the country out from an utter collapse that
was going to occur. I think we could be in
a similar situation with AI. And I don't know how
AI will work, but I think AI is far more
profound than the Internet. It's already affecting so much of
what I do, both for business and pleasure, for show notes,
for plotting out the show I'm working for a company,
I'm doing a marketing plan for them. I'm working in
another company. I have to figure out what went wrong
with a company. It is become a force multiplier for
me because I can dispense with so much of.
Speaker 4: The ordinary thought tools.
Speaker 3: Now, whether it'll replace me or not, I don't know,
but conceivably it could drastically increase productivity throughout the economy,
and then there will be job displacements, just like there
always is.
Speaker 4: In the end.
Speaker 3: Technology the past past is prologue. Technology has always led
to more jobs. It might not be the case here,
but I think that is our one light at the
end of the tunnel.
Speaker 4: It might have this kind of effect.
Speaker 3: Imagine if our productivity went up four or five or
even ten percent, what would happen to the economy?
Speaker 1: Then ed, well, that's the thing, right, Efficiency drives productivity,
and the AI component is more and more and more
adopted because you know, you know how people are like.
They don't like change, nobody likes shit. We don't like
them be differently. Why would we think differently? Even though
that everything tells us to think differently. The human bring
doesn't work that way. We don't like to be rewired.
But the reality is is that the AI is kind
of a rewiring of business of you know, it's a
rewiring of like the way that we think as business
owners or as employees, or is just like everyday people
and so definitely productivity. You know, they always say technology
is deflationary, and so the question is is, like, you know,
to your point, does this AI have the ability to
kind of deflationize the incoming inflationary storm? And I think
that a lot of it just depends on adoption and
trust and and you know, that's the thing that is
steering I think a lot of people away from it too,
is that, you know, can I really trust this? Is
this thing really going to work? And then when you
buy eighty you start using, You're like, oh my gosh,
like I can get ten times more stuff done because
like I only got to do the last ten percent.
I don't go to they to the first ninety percent anymore.
And so you know that unfortunately that does mean a
lot of people lose jobs. But then there's also on
the other side, there's a lot more different types of
jobs that are created, you know, and instead of like
being on the factory line, now you just got to
spot chat things you know, before it gets to that
final decision for that last ten percent, So it could
it could totally do that. You know, I still think
that we're in a situation where like, uh, that's what
like brings us out of things getting really bad. I
don't know if we can avoid what's coming. And you
know that that's my biggest fear right now, is just
an advisor is you know in two thousand and eight,
two thousand and nine really bad, two thousand and two
thousand and two really bad. Why were we able to
recover two thousand and two thousand and two and two
thousand and two thousand and eight. A lot of it
had to do with technology, And I think that the
technology will be the saying that saves us from disappearing, right,
But I don't pick this out a little bit of
pain first, unfortunately.
Speaker 3: Yeah, Yeah, I agree. I mean I think the AI
is already taking over the government. You know, in the
there's a utility. I just happened to buy shares in it.
I'm not saying anybody should called Dominion Energy at their
primary areas like Virginia Northern Virginia, and they just sent
notice to everybody that if you want to open a
data center in the northern Virginia.
Speaker 4: You have to make a reservation.
Speaker 3: If it's like five hundred megawatts are higher, they have
to reserve it because they're out of capacity. And that's
something that's like and that's the reason I bought them.
I said, Hey, to me, electricity is the best play
on the economy because no matter what happens, they might
not have figured out how to make money off of
AI yet, but they're going to. There's no question some
people are already doing it. Who got in early. It's
not just in Nvidia, all of them. Like I said,
I'm not saying anybody should buy. The stock got up
like not that high for me. I've had it for
a few months. It's up like ten percent, which isn't bad,
plus is a dividend. While I'm not saying anybody should buy,
and I'm not a financial advisor, but I just thought
it was a cool play on AI and so electricity
utilities they're going to have to do dramatic expansions here
and it's not going to be enough just to put
in solar cells and batteries. They're going to be building
power plants here right.
Speaker 4: Oh.
Speaker 1: Absolutely, I think that you know, it's interesting that you
talk about that, because you know, we were huge advocates
of utilities this year, like like one from a standpoint
that they were just like so they had underwormed so
much relative to the SEB five hundred. But then also
just because of this demand that you're speaking of, and so, like,
the funny thing about it nowadays is that utilities generally speaking,
are that thing are if you're staying in equities, it's
to flight the safety in equity. And you know, when
things get bad, people money managers, big money rotates right,
becuse they can't sit in cash, they're not allowed to.
They rotate to utilities, they rotate to value stocks, they
rotate to dimon in pairs, right, and that's where they go. Well,
now we've got this thing called AI and you know,
we still have this thing called cryptocurrency, which is very
tech heavy. We still have a lot of miners out there.
We still have a lot of that that it is
driving a lot of demand for electricity. You know, like
a lot of these miners, it's not that they can't
make money or that they don't have the money to
buy the machines to be able to continue to make money.
Even post having they can't get the energy, you know that.
And so you know, obviously supply and demand is always
the king, it doesn't matter what you're talking about. And
if you need more energy, then the cost of energy
is going to go up, right, And so I think
you're absolutely right there. I think that that the as
people figure out and we have you know, more adoption
on the AI side, we have more adoption on the
bigcleaning cryptocurrency side, that's just going to drive like more
demand for energy. And you know, to your point, like, yeah,
I know that Elon wants to just carve out of
you know, a corner of Texas and just put a
solar form, but luck with that, that's probably not going
to happen, and that takes time.
Speaker 3: You know.
Speaker 1: It's the same thing that we've talked about with the
whole like you know, grain energy of this last administration.
It's like that's nice, but like we don't have the
infrastructure to being able to produce what we need to
produce already. So if you start taking stuff away, well,
guess what, that's also going to raise the price of energy.
And and so there's a very very strong supply and
demand story. And again it's typically the the the area
that is most valuable when things get bad. Not that
it doesn't go down, but it doesn't typically go down
as much. And these utility companies, people still pay the
energy bills. They got to keep the lights on. Got
to keep the lights on, and that's why the dividend
keeps coming, you know. So uh, we're it's it's made
it challenging as a money manager this year because sometimes
it's hard to de cipher is the energy play the
utilities play. Is this a risk off factor or is
this a supplying demand factor? And I think that that's
what's caught a lot of tactical money venders off guard,
is that they've leaned into utilities as like a risk
off play, and what's happening is it's becoming more of
a supplying demand play. And so like it's ciphering that
is becoming much more challenging when you look at your
traditional intermarket relation ships and the coming storm. That's why
you got to go back to basics and look at
our our good old favorite, good old gold. Right y
been sending a warning. I mean not saying that you
need to jump on the sidelines, but we do have
a significant warning being set by gold. I mean you
look at today, right, like everything in the market is
down except for bitcoin. That's interesting, right, and some of
it maybe conflict, you know, some of it. A lot
of it could be just distrusted and fiat like you
were speaking about. So it is, it is very it
is very interesting kind of the new supplying demand dynamics
that are coming out as more technology becomes available.
Speaker 3: Yeah, bitcoin is up, you know, going to break that
sixty five thousand mark.
Speaker 1: Because I keep getting the sixty six and then retreating.
So we'll see if you can do it this time.
Get because I think when the high and the seventy
three range, so thinks he probably go to one hundred.
Speaker 4: But sixteen was first.
Speaker 3: Seventy five is a psychological resistance. Yeah, sixty five kind
of it is our current resistance point. But it broke
through sixty again and sixty four, so it's going to
be interesting. It's its market cap now is one point
three trillion, and i'd expect to see in the next
couple of months, especially if there's a lot of election
post election civil unrest, I'd expect to see it go higher.
And so we find you attactivewealth dot com.
Speaker 1: Correct, Yes, tactic slash Eddie Dash Gifford obviously, just go
on to Google. You can also just look up Eddie Gifford.
That's Eddie with A Y, G, A F, f lr
and G. But yeah, Hey, it's about the exciting Jerry ready, never.
Speaker 3: Dull Hey, and I'll do you one better if you
go to the show notes this enterview on Financial Survival
Network dot com. You just click that link and it'll
take your right to Eddie's site. While you're there, please
sign up for your free newsletter.
Speaker 4: We're over.
Speaker 3: I think we're getting close to thirty five or forty
thousand subs right.
Speaker 4: Now as we speak.
Speaker 3: Goal is by the end of the year first quarter
Q one of the twenty five to hit one hundred thousand,
which would be a huge milestone. Ed appreciate you coming on.
We'll talk to you again real soon. Oh, if you
got a question for Eddie or myself, shoot me an
email kl at Carrie LUTs dot com.
Speaker 4: Ed, we'll talk to you again soon. I appreciate it.
Speaker 1: Kerry, thank you, thanks.
Speaker 2: 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
Speaker 1: Now more than ever,