110 - Don’t Trust the Headlines: Inflation & Jobs Are Getting Worse

Forget the fluff—this episode unpacks the real story behind the headlines. We dive into the numbers the media won’t tell you:

• ✅ Inflation’s hiding big jumps in electricity + natural gas, even as energy prices fall.
• 🚧 The labor market looks solid—until you factor in revisions, revised months ago, and the rise in multiple-job workers.
• 📉 Consumer sentiment cratered—down over 30% since January, and Americans are bracing for 7% inflation and rising unemployment.
• 🔎 We examine GDP, trade data, market indices—and the Stagflation Trifecta that the Fed quietly hinted at.

We’ll help you answer: Is the market too upbeat? Too down? Or just right? Plus, we map out a smart strategy to protect your portfolio. This isn’t fear-mongering—it’s financial clarity. Tune in.

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**DISCLAIMER**
Ticker metrics change as markets and companies change, so always do your own research. The content in this podcast is based on personal experience and is for educational purposes, not financial advice. See full disclaimer here.

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Transcript

Welcome to roaming returns a podcast about generating a passive income with dividend stocks so you can secure your finances and liberate your life. 

Think everything’s great because the headlines say so? Think again. Today we’re tearing apart the rosy picture: inflation and unemployment are ticking up, tariffs are screwing with supply chains, and consumer spending is cooling off. Add in tanking sentiment, and we’ve got a market that may be too optimistic. If you’re serious about making informed investment decisions, it's time to peel back the curtain and take a deeper look at the numbers.

Hello. All right. So we're trying this out.
Hopefully, this works out for everybody. What's up? Coming to you from the middle of nowhere. I'm in Nowheresville, America.
Nowheresville, America. America. I mean, I sent I sent Carmela some pictures.
So she shares them with you. You'll see that I'm literally in the middle of nowhere. Yes.
I will try to put them in the background once I figure out how to edit this thing. So this episode is about what, Timothy? Oh, well, last week, we mentioned that we're just going to go over the current data. Yeah.
It's a data dump about the current state of the economy. And we're going to focus on the inflation, which is something that everybody's hyper focused on. We're going to focus on the growth and we're going to focus on the labor market.
Those three things are the three components that the Federal Reserve looks at whenever they determine when to lower or to cut interest rates or raise interest rates. If inflation is too high, they generally will drop the rates. And if labor is too low, they'll raise the rates.
And like we have all this data and it's really conflicting. And you can see, in my opinion, like when we get down to like my analysis of it, you'll see that everything is basically fitting a narrative and it's actually not what the data is reading. So we're going to start with the basic numbers of like in May, the May 2025 CPI, if you're not familiar with the CPI, CPI is the Consumer Price Index, which basically they they focus on urban consumers more than rural.
So it's mainly about the cities. So it's not an all encompassing data point. But still, the May the May CPI inflation rate was 2.4%. And the May 2025 CPI, core inflation report of the core, what what what they do with the core numbers, which is I don't like and I bitch about this a lot in emails, is they will actually strip out energy and food prices because they consider them volatile.
So they take them out. Which I think is that's some bad manipulation of data. So without the food and energy costs associated with the data, the May 2025 CPI core inflation rate was 2.8. And then we have the April because the the major report doesn't come out till 627, which is a few days from now, like a week from now, the April 2025 PCE inflation report, the PCE is the personal consumption expenditures that what they normally focus on is the spending to buy and on behalf of all consumers, not just rural, they actually encompass the world and the rural and everywhere in between.
Okay, so the April 2025 PCA, PCE inflation rate was 2.1%. So much lower than the May CPI. And the April 2025 PCE core inflation rate was 2.5, again, much lower than the core inflation rate of May of the CPI. And what if you looked at those numbers, because you know that Federal Reserve wants to be at or below 2% before they consider inflation tamed.
So if you look at those numbers on on the surface, they look good. But if you actually look, dig in deeper, which I kind of do, because I'm a nerd, you see some some huge cracks that needs to be addressed. One example would be the energy inflation, because they strip out the energy, you don't get a full picture of what the what the energy is actually doing.
The surface number of the energy in the May 20, the May 2025 CPI report was that it's a negative 3.5% year over year inflation rate reading. So that's really good. You think, oh, that's awesome.
That's good. And energy costs have went down to almost 4% from 2024 to 2025. But that is literally due to oil and gas being negative, they're 12% year over year.
So like gas and oil is 12% lower than it was in 2024. So that's why that number's down? Yeah, where I see some like, that's why that number's down. And you'll see why like, it's negative 12% and you're only at negative four.
That's a huge difference between the 12 and the four. But if you actually look at what's important to most people other than gas for their cars, the huge red flags are electricity is up 4.5% year over year and natural gas is up 15.3% year over year. Yeah, that's really bad, like really bad.
If you use electricity, which most people do in the summertime for their air conditioners, you're paying 5%. Oh, go into the air conditioner thing. What about it? About how when you showed up in Luna and you walked into the house, the air conditioner was cranked on and all the windows are open.
Oh, yeah, my family, when I showed up, they had like, they have this little tiny, it's like probably a 12 by, we'll say 12 by 12 to be conservative. That little 12 by 12 unit they had just blaring. And they had that going on like all hours of the day.
That thing was on all the time, but they had every window in the house open. And they had lights on. So they basically were just, they were just running the electric bill up for no reason because you saw that little box unit, that little box unit doesn't heat up shit.
And this is probably a 1800 square foot double wide mobile home in the middle of nowhere. So it's not really... Do you have the data at all for like, how, what's the average temperature that people run their air conditioning at? 72? I don't know these numbers. I think it's 68.
Seriously? Now, don't quote me on that because I did like, I looked it up years ago. I don't have actually like a newer data, but I did look it up years ago, like when we were talking about how to actually save money. If you just bump your air conditioner from 68 up to say 74, you're going to save a butt ton amount of money and you're just going to, you're going to be just as hot as you would be if you were in 68.
But that's not the point we're trying to make. We're just trying to show that like, they're taking out electricity when electricity during the summer for most people, unless you have like something that's run on natural gas. But again, that one's taken out.
Do you have a natural gas one? So the freaking electricity and the natural gas are taken out of those numbers? Yeah. So like, what I think that like, so basically that negative 4% year over year inflation, I don't think it's accurate because generally more people spend more on their utilities than they do in the fuel in their car. And the fact that utilities are up at like electricity is 5% and natural gas is 15% and oil and gas are only down 12%, I'm assuming most people are actually spending more in the energy sector than they were last year.
So I just looked it up. It says that the average is between 72 degrees and 76 degrees. The lower end is 68 and the higher end, like us weirdos is 80 degrees, up to 80 degrees.
And if you dig into the data more, there's a 7% year over year increase in the energy services sector. Energy services being like delivery of things and of that nature. So like, what I want you to see is that the numbers appear to be good, but they're not telling the whole story.
And I think the whole story is important because I see the oil and gas being down 12% as that's probably something that I should invest in because it's down 12%, but that's not what this is about. But like, that's where I went with it as soon as I raced your sales house, I was like, well, I need to invest. What do you mean that's not where this is about? That's the whole lens that we're looking through this.
The whole reason we need to come through this really dry, crappy data is because we need to figure out what that actually means from the investing standpoint to figure out where the hell our portfolio should be allocated properly. So yeah, you do need to drip those throughout here. The next thing that is brought up, like if you've watched, if you watch CNBC or Yahoo Finance or CNN Business or any other publications, the numbers they use a lot are the 2.4 year over year inflation reading that includes food and energy and the 2.8 year over year which strips out food and energy, the top two numbers that I went over.
They literally love to talk about it. Every article that I go through that deals with inflation, they bring up the year over year numbers. But if you look deeper into, if you actually pull up the report because it's a government issued report, you can actually go into the labor website and pull up their reports.
You see that shelter and medical, which are two things that people care about a lot more than new cars or used cars or lumber and shit like that. Shelter is up 4% year over year and medical is up 3% year over year. So again, that 2.4 and that 2.8 don't mean shit whenever you actually start factoring in what you're using.
You're using your air conditioner. Your air conditioner costs 5% more than it did last year. Your house mortgage, I'm guessing it's renting.
Your rent for your house is 4% more than it was in 2024. Your medical bills and things of that nature are up 3% more than they were in 2024. So the stuff that people actually use, and that doesn't even include the food, like where they get the number, they look at food as a weird mixture of service food and grocery store food.
The service food being like when you go out to eat, the food services are actually down like 6% but the actual food is up 3%. So if you go to the grocery store, you're paying 3% more than you did last year. If you go out to eat, you're actually paying like 6% less than you did last year.
So that's how, that's why they say that it's too volatile to be included in the inflation numbers because like if you actually look at it, you're like, well, that doesn't make any sense. It's not volatile. It's just that they're too lazy to pull out the actual nuances, which I think are the important pieces.
Like, yes, the data is dry. I get it. Like I said at the top, the Federal Reserve has stated time and time again that rates will not be cut until inflation is 2%.
And magically, the deeper data is showing that inflation is almost, I think it's closer to 4% than it is to 2%. But that's my opinion. But that's because they skew those data, right? Because it just even showed you, if you pull those pieces out, it looks lower than it actually is.
Yes. If you pull, if you pull out certain pieces, you're going to get the data that you want. And like the current narrative by the policy makers in power is that interest rates need to be cut.
So they're going to actually, they're going to curtail the data to fit that narrative that we want interest rates cut. So inflation's great. So my question is, is the Fed actually looking at the real numbers or are they eating up the BS of the manipulated data or the skewed data to paint the rosy picture they want? What the Fed uses for inflation data is generally the PCE, which we'll get at the end of this week.
That's like their preferred, like what they say is their preferred inflation reading is that PCE. But they do look at the other data as well, but they don't, like they, they're probably just going to take whatever the PCE says and then they'll say, hey, PCE says 2.4, but there's other sectors like, like the electricity that's up a lot, but they look at the labor market and they look at the growth of the economic growth as well before they make an interest rate decision. I mean, I'm sure they have lots of data in their little meetings.
I'm not going to, I'm not going to pretend I know what goes on in their meetings. I wasn't sure if it was so blatant, like you can make a comment, like it's fine if you have no idea. But I know they have all this data at their disposal.
Whether or not they use it, we have no idea. Whether or not they use it, I don't know. I just know that their preferred inflation reading is that PCE.
Okay. That was what I was asking. So that's the inflation component of all the current data and the inflation to me is still super high.
And when we get down to consumer sentiment, I'm not the only one that thinks that. And that's going to be a huge problem, but we'll get to that here in a minute. We're going to go to the labor market next.
The labor market, remember I said at the top, if the labor market unemployment gets too high, they'll actually start raising rates again to counteract the high unemployment. So remember that. The most recent JOLTS report came out for April.
It came out in the end of May. The JOLTS report is the Job Openings and Labor Turnover Survey, which is where they survey companies to see what their openings are and what their wage growth is and things of that nature. The latest one showed a sideways trajectory.
The April hirings did increase by 3% over the March number, although April separations increased 4% over March number. So they had 3% more job hirings, but they had 4% more job quittings or fires, like separation. So that's kind of not good because that means we're actually losing more jobs when the most people, when they lose a job, they fill out unemployment claims and they become one of the unemployment figures.
What the Fed uses with the JOLTS report, they actually also look at the non-farm payroll statistics and they also look at the ADP report. The non-farm payroll statistics increased in May by 139,000, although that number was much lower than April's 147,000 on non-farm payroll jobs. And it should be noted that both March and April's numbers revised down drastically.
They went down between 60 and 90,000. So what they're doing, again, to fit their narrative, they're saying, look at all these job openings we have. But then a month later, they'll actually post the real data and the real data is much, much worse in the labor market.
How the heck can they get away with that? Do people just not go back and look at, when they come out, they only look at them? Again, we had this discussion, basically that falls on the people's media consumption. Most people's media consumption, because everything costs money, they go to where they can find the media for free. If the narrative for that particular media company is that the labor market's good, they're just going to show that the May number of 139,000 jobs, they're not going to show March and April's being revised downward by 20 to 40%.
No, you and I had this conversation. We didn't actually talk about this on the podcast. So what Tim is basically saying is, we've noticed a massive disparity with what is actually available for free for public consumption versus what you have to go behind a paywall or sign up for crazy stuff.
You said most of it's behind paywalls. It's getting really bad with most websites. It's getting really bad.
What raised my eye is that, because I used to go on CNN probably a couple of times a week just to look at the CNN business, and I can no longer do that because CNN wants me to actually give them, make a subscription and pay them money. I was like, well, that's crazy because they're a media company, that shit should be for free. But if you want to see anything worthwhile in Yahoo, you have to pay for it.
They'll give you some stuff free, but the stuff that's really important, like if you're researching stocks, you want the pro data, the pro data you actually have to pay for. Same thing with CNBC, you get the bare minimum for free, and then you have to pay for stuff. So what I'm seeing is you're having to pay for media, and most people pay their money so tight that they're not willing to pay for what news they watch.
So they just, they navigate towards whatever's free, and whatever's free, so those free media companies can control and dictate the narrative however they want it to be. Whether it's that the economy's great or the economy's shit, they can just, they direct the data and the statistics to fit their narrative. And the thing with having an accurate information is being able to see all sides of something and actually fill in the gaps or get an idea of what the picture is actually happening.
So that's one of the reasons we put everything out there for free that we're talking about from the perspective of getting the news out, because this is important information for you to base things off of. We're transparent with absolutely everything. So just imagine for a hot minute that you were flipping through the news, or that you were online just checking out your news, and it said that there was only 40,000 jobs last month, which is what happened in March.
March went down from 129,000 down to 49,000. So just imagine that they actually provided that 40,000 number. People would lose their shit, and then there would be no discussion of interest rate cuts.
And again, like I said in the inflation thing, the current narrative with the policy makers in Washington is they want interest rates to be cut, so they're never going to talk about what the actual state of the labor market is. You actually have to dig and find that. And that information comes out after the update, right? It comes out later? Yeah, so the revisions usually come out with the following month's data.
So they'll say, it'll be like a slight blurb, it'll be like, well, in June, non-form payroll statistics were 126,000. We did actually revise May's number down from 139,000 to, say, 70,000. That'll actually just be like a one sentence in the next month's report.
That nobody touches upon, because they're focused on the new data for that current situation, right? Yeah. But that's how a lot of these numbers are getting mixed and missed. And this is why Tim's data is probably so much different than what most people are seeing out there.
What you're hearing from the media and what you're hearing from me is not going to be the same. And that's why. So we want you to know that that's what the difference is.
And then, OK, so the last of the three employment reports was the ADP report, which focuses solely on the private job market. And that showed only 37,000 jobs added in May. That was a significant slowdown.
April had 60,000 added jobs, and it was the lowest number of jobs in a month since March of 2023. The labor market is cooling. It is tightening.
And there's some other interesting things. Like, I can't even, like, I don't even know how to present this where it's going to make a logical sense to you here, this one. Not the unemployment.
The unemployment rate remained at 4.2 for May, which is good. But again, if you look under the hood, you see cracks in the labor force. Initial unemployment claims held steady at 248,000, which was the same as April, but still at an eight-month high.
And the continuing claims, like, so if you're not familiar with unemployment, if you get laid off, you file a complaint with your state. That will become an initial claim. You're initiating a claim in your state that you're unemployed and you would like to get some unemployment money.
That generally takes two to three weeks. Continuing claims is people that have been approved for unemployment that have continued to draw on their unemployment. You have to reset every week.
Yeah. And the continuing claims are at their highest level since November of 2021. And we all remember what happened in 2020, into 2021, and it's at 2 million.
So continuing claims is at 2 million still. So like, that's crazy. And if you keep adding 250,000 a month, by the end of the summer, we're going to be at like 3 million people with continuing unemployment claims.
But that's not the point that I think is going to be confusing. That seems all pretty cut and dry. I think the data point that gets nowhere near the play that it deserves over our channel, I'm guilty of this as well, or the mainstream media, is that over 5%, 5.2 to be exact, or 8.9 million people of the working population work multiple jobs, according to the May labor data.
Even more striking than that is the 5.2 is historically much lower than the median. The median is like 6-ish percent, but the 8.9 million people is the highest number ever reported. So we're currently going on, like, so of all these jobs that they're reporting that have been filled, or like the Jones report saying that the people have filled positions or the non-farm payroll said we had these many jobs in this month, you have to think 9 million people are working multiple jobs.
They don't differentiate that in these other, like the ADP report, the Jones report, and the non-farm payroll. They don't care that someone could, like, take three jobs. To them, that's not one person working three jobs.
That's three people working three jobs. And that's just the government numbers, which is on the labor department's website. There are private company numbers that put the percentage of people working multiple jobs between 33% and 50%.
So a lot of people are working multiple jobs to make ends meet. So the labor market looks like it's pretty strong, when in actuality it's not. And you can see that with the unemployment data being at the highest it's been since 2021 continuing claims.
And the month, even, like, April was not really that good, even though it looks like it was decent. Like, for all the talking heads, they're like, April was a decent jobs month. April actually wasn't that good.
April generally is the month with the highest numbers for the year. And the fact that the numbers came in as low as they did in April means the labor market has some serious cracks in it that is not being addressed. So the other thing that I'm not seeing here in our notes that I saw in the emails when I was drafting them up for the weekly stuff, you mentioned somewhere that the unemployment numbers are skewed and they look actually better than they are because anybody who's on unemployment is technically employed.
Yes. So you're not like, so the unemployment numbers that unemployment at 4.2, it doesn't mean 4.2% of the working population is not claiming any money. 4.2% of the working population, they have no data on.
So they're like people that aren't on unemployment. Unemployment actually counts as a job. Yeah.
So you mean that? It doesn't count as a job for like the jobs reports, but it doesn't count as unemployment. So if you're collecting unemployment, you're technically not unemployed. So the 4.2 is kind of low.
By the way that they are skewing this data to get the numbers out to make stuff look like it's not as bad as it is. And when I read that in the emails, when Tim, like on our weekly emails, and I saw that, I was like, that right there, that is huge. Because those numbers that we literally just talked about, 2 million people, the claims being 2 million, continuing claims being at 2 million, that's huge.
So that 4, yeah, that 4 point whatever percent of unemployed, 4.2. So I said, so unemployment is probably like 4.6 to 4.7%. Yeah. A lot higher. Maybe not that high, but like, I don't have like the exact data in front of me that I'm just guessing, estimating.
So when you piece it all together, you have a, to me, it's not muddled, but like all the experts say the labor market's muddled. To me, it's not muddled. To me, the labor market is on the precipice of being bad.
But to the experts, the labor market looks like it's being persistent in the face of a bad economy. Do you have the credit situation in this at all? No. So let's comment on that, because I know you've touched on that in a bunch of stuff.
Is credit still continuing to go up, like people's debt levels? The amount of people with credit card debts, the highest it's ever been. Which would correlate if you don't have a job, you're going to start sticking stuff on credit. It's like $2 trillion or so, or $20 trillion, I forget the exact number, but it's a lot.
So there's a lot of people that have like outstanding balance on their credit cards. Even more depressing is there's a higher number of people defaulting on their credit cards because they're not making their minimum monthly payment. That's like the highest it's been since the pandemic, people defaulting on their credit cards.
So we are in a pretty, to me, in my opinion, a dire situation that is being completely overlooked to fit a narrative. And I don't think you have it in here either, but we were just talking about stagflation. The last update that we just had in the email, the three factors that go into creating the ideal scenario of what stagflation actually is, is like we're literally teeing them all up.
Well, yeah, it's high inflation, it's high unemployment, and it's low growth. And we have literally that is what we have. And they're actually starting to discuss stagflation a bit more in the news, which is good to see.
If you're not familiar with stagflation, just quick Google the 1970s. That's when stagflation was really bad. Because it's difficult to get out of it because you have high unemployment.
To get rid of high unemployment, you raise the interest rates, but you have high inflation. To get rid of inflation, you lower the interest rates. When you have low growth, you want to lower the interest rates.
So the Fed's kind of fucked because they can't do both. So it's very difficult to get out of a situation when you have stagflation because of the only two arrows in the sheath, as they say, is to lower rates or raise rates. And if you do one, you're going to hurt half the economy.
If you do the other, you're going to hurt the other half the economy, and you're already in a bad economic situation. The 1970s stagflation was pretty much the entire 70s. And the component that we haven't brought up yet that goes with the stagflation is the economic growth.
If you recall, we did discuss how the economy was at negative 3% GDP in the first quarter. If we have another negative number, we're going to be in a recession. So I'm pretty sure that the politicians are going to do everything in their power to make that not happen.
You mean like actually make that not happen or skew the data so it doesn't look like that's actually happening? They're going to do whatever it takes. Okay. FYI, guys.
The overlord will refuse to be in a recession. That's his fault with stupid economic policy. The Federal Reserve just had its meeting for the month of June come out, and they said they're only projecting the economy to grow by 1.3% to 1.6% for 2025, which is well below where it's been the last few years.
It's been in the 2% to 3% range. And they're projecting 2026, which should be just as bad. But in all actuality, they don't know.
They're just guessing because nobody knows what the tariffs are going to do. I know the biggest problem with all this, right? Yeah. Because it's creating an uncertain economic climate where a lot of the data is skewed because most people front-loaded the tariff.
Whenever the overlord said, we're going to do a 90-day reprieve on the tariffs, everybody just started picking up stuff. The consumer companies, everybody just grabbed whatever they thought they would need for the near future to avoid paying a tariff on it. We actually haven't seen the data come in yet from that because there's still like a supply glut going on because they front-loaded the tariffs so much.
But they're projecting by the end of the summer, we'll start to actually see the full damage of what the tariffs will do. So they don't really know. So my guess would be that the GDP won't be negative for a quarter or two just for that reason that everybody's front-loading the tariffs.
They consumed what they could. Yeah. Which may lure people into a false sense of security.
So then they'll maybe go out and spend. But then I still think if the data then comes in that it is repressed, people are going to panic even more. So unless Trump gets rid of the tariffs or something other drastic happens, because I think he really, really, really wants the interest rates lowered, which I think is why he's doing what he's doing.
The problem is that when you start manipulating factors, but when you start manipulating factors, you get ripple effects of other stuff that aren't good. And that's what's happening. So my projection, if I was the Federal Reserve, I'd say quarter two is going to be pretty good.
Quarter three is going to suck. And quarter four is a toss-up. Have they said that? No, they didn't.
They refused to say that. They don't have the balls to say that. They said they could see that growing 1.3 to 1.6 percent.

So they just reworded it. Well, I could see that all happening like in the second quarter, like they didn't break down the quarter by quarter like projections. I could see quarter two being super high because everybody was spending money to get ahead of the tariffs.
The quarter two could be like two to three percent growth. But then quarter three could be like negative two percent growth because the tariffs are finally taking effect because the supply is gone. Yeah.
So there's a lot of what if could like what could happen, could happen, couldn't happen going on with the actual growth. I just know that historically speaking, tariffs don't lead to economic growth like we've been told in the media and by the overlord. Yeah.
Well, just think about it from a common sense standpoint. Like those two things do not seem like they would go together. They used like there was a time for him, but like when he brings up like the 19 or the 1890s to the 1910s.
Well, back then, America could make stuff. We can't anymore. Things have changed.
He's put tariffs on stuff in hopes of bringing jobs to America, but we don't have the capabilities or the training or anything to make. We're not built for it. To iPhones or to make shoes.
Yeah, nobody wants to work. And there's a lot of people who don't have the capabilities to even do those kinds of jobs. So unless they go back to like trade schools or something, like there's just a major gap in skill set too.
So that's a huge thing that nobody talks about because what happens once there's a supply crunch because nobody can make stuff in America and nobody wants to pay for stuff that's brought in from overseas, shit's going to get really expensive. And that's why everybody thinks that inflation is going to go up because people aren't going to buy an American made iPhone for $6,000 and they can just pay a fucking 40% tariff on a Chinese one for like $3,000. Yeah, exactly.
And that leads us into the consumer sentiment. In my opinion, one of the most overlooked surveys out there is a survey that the University of Michigan publishes each month called the Consumer Sentiment Survey. Here they interviewed the consumers.
They used to use phones, but they did away with that in 2016 where they started doing online stuff. So I don't put a lot of stock like in the sample size and like the makeup of it, but it just gives you like a glimpse into the mind of the consumers that actually fill out the survey. And the consumer spending makes up about 70% of the GDP.
So if you can get like a glimpse into their mind, even if it's not like a completely good survey, it still gives you like some data to use. But if you couple that with literally what we just said with the taxation and the tariffs and all that, if 70% of the people aren't spending, the GDP is obviously going to go down and all that other stuff just kind of trickle behind it. But what we do know from the May survey is that sentiment is down 30% from the January survey.
So like the consumer sour. That May sentiment was the second worst on record and this has been going on since 1971. Holy shit.
The consumer expects inflation to hit over 7% this year and long-term inflation is expected to be 4.5%. What they consider long-term is like two to five years. So like the next five years, they expect almost 5% inflation. That's what the consumer expects.
Why is that important? Well, like if you expect something to be 7% this year, like you're paying 7% more for it this year and then 5% more and it's like five years, you're probably going to wait to pay like 2.5% less unless it's something drastic, like I don't know, like a furnace or something or air conditioning, the HVAC unit. Yeah, like if you can wait, you're going to put it down the road if it's going to cause that much of a hit to your wallet. So that's going to seriously, that's going to hamper growth because people are just going to hold off in hopes that they can get the items they're looking for cheaper in a couple of years time.
But there is going to be a large swath of the population that has that instant gratification thing that they're just going to do it anyway because it's kind of like the whole concept of Grubhub and all that. They'll pay more for the convenience. But like what's like even you brought up Grubhub, but what they're actually seeing with like, this is completely off topic is food service was dominated by Grubhub, but now there's like 18, like not 18, but like eight different companies that do the same thing for cheaper.
So that's like part of the beauty of America is like you get the- The free market, yeah. You get the brains that create stuff like Zoom, that create like something like Grubhub, that create stuff. And then you get the company, like Uber, and then you get the company to say, hey, that's a great idea.
We're going to replicate that and do it our way. So like that's the beauty of America. There's not just one company that runs everything.
That competition though is actually really good because it forces innovation and people to think outside the box to solve these problems and these hangups. So if people can figure out how to do it better, faster, cheaper, like that's actually a good thing. That's still going to take a couple of years to like fully implement all that stuff.
So we're still going to be looking at a couple of years of pretty lean times. But I'm just saying, if people are still willing to pay Grubhub, like you are still going to have the instant gratification people who justify the spending. Now I will also say that some people have the bias when it comes to the actual taxation or like that pain of because of the anchoring bias where people like if they blatantly see an increase in price in something, they'll be like, oh, oh no.
Until like that re-anchoring happens. I know I do that. I'd be like, fuck this.
Well, we're going to discuss that next week. That's something that like I had an epiphany about. We'll get to that at the end here, like what next week is going to be about.
But like we actually do kind of, we're actually going to kind of delve into that, but not in like a fully encompassing thing. It's going to be just about specific things. Back to the survey.
The 73% of respondents were not pleased at all with the tariffs. I couldn't find the makeup of the survey, but like what they're saying in the news is that even that 73% includes a lot of people in the same party as the overlord. So he's pissing off his base, basically.
This is a key point that I want you guys to hear. 17% of respondents expect to spend money as usual. So 83% of people are going to up, like they're going to change their spending habits based on their perception of the economy.
And only 17 are going to keep as per usual. Yeah, that's big. That's a huge number because again, 70% of the GDP is made up of the consumer spending.
So if consumer spending is altered drastically by 83%, that means the GDP is going to shit the bed. Yep, yep. That's exactly what that means.
65% of the respondents in the May survey said they expect unemployment to spike up, which is contrary to what you're hearing from the media and the overlord is employment's going to be fine. Well, two thirds of respondents feel that unemployment's going to be bad in the near future. Respondents indicated that the probability of them losing their job is at the second highest level ever recorded, only behind July, 2020.
We kind of remember what happened in 2020. I think everybody can't forget that. So like the fact that we're at a time where like when they ask people, do you expect to have your job? And we're getting the second highest response ever where people think they're going to lose their job.
That's telling. If you think you're going to lose your job, you're not going to spend like you do if you don't think you're going to lose your job. That might be why that 17% is as low as it is.
Every category inquired about from economic conditions to finance to economic expectations is down and down a lot, between 20 and 50% since the January survey. If you actually go back into November and December, post-election bounce. So like the October consumer sentiment was really good.
The November one was decent. If you go back to the December one though, like these are really bad results. If you go back to November and December, the 20 to 50% that I just mentioned there is actually like 40 to 75%.
The expectations are down that much. Wow. So that's like what that brings to my mind is we're starting to see a huge disconnect between what is being reported by the media and what's told to us by the overlord regime and what average Americans are thinking.
I mean, I'm told like in emails and research, I'm told probably 40 times a day that everything is great and that the policies that are implemented are working wonderfully and they're the best policies that have ever worked in the history of American policies. Yet people feel the exact opposite. I wonder how much brainwashing it's going to actually change people's sentiment or if it actually will.
But I don't see how people like actually having a different experience in reality could be swayed by that. That blows my mind. Well, it's interesting.
If you look at it from a psychology aspect, not like your life depends on it type thing, it's very interesting how you get told by this encompassed circle that everything is great, but then everybody's like, no, nothing's great. And so why do they keep bringing up that everything's great if nobody's like, nobody believes it? It's like the psychology of it's interesting. So like what they have to try, they've been working on their brainwashing hard to get people to believe this crap because nothing that I've heard in the last three months is good for anything.
Well, I almost want to say I'm actually proud of the American citizens that actually are in this, the negative sentiment, because they're actually seeing the facts for what the facts are. And regardless of whatever the sentiment pushing or the narrative pushing is. So like kudos people.
And one aspect that I want to actually focus on is if you go on, and we just had the earnings reports for the last quarter come through. Walmart, Target, Dollar General, Costco, all these companies that kind of like are dependent upon like the middle class and lower class shoppers. They all said it in their earnings call in some shape that consumers are being very selective where they spend money.
That statement made by four huge companies isn't the statement you hear when the economy is humming along, like we're told. If the economy is great, you don't hear companies saying, hey, the consumer is not, they're being selective how they're spending their money. The economy is great.
You hear consumers are spending their money left and right. And our profits have never been better and everything's hunky dory. So you're actually starting to see it in actual earnings call, like earning call.
Like if you're not familiar, you have the earnings report. They just like, they blurb something out in the interweb that says here's what we did this quarter. The earnings calls when the company actually talks about the results and where they feel like where they think things are going and they actually use the data and they make assessments from that.
And they're seeing a drastic change in the consumer. Again, 70% of our growth as a country is from the consumer spending. So like if they're seeing that, like Walmart and Target and Costco are seeing this, I guarantee you most companies are seeing that the consumer's not spending money like they did.
Mm-hmm. So doom and gloom, it is what it is. How do we navigate or like what all does this really mean in like layman's terms with like- The first thing you have to understand is that the overlord really, really, really wants interest rate cuts.
And I think that's, I don't think that's from like they're trying to spend it as it's from the national debt thing. His new bill proves that he could give a shit about the national debt, adding 5 trillion to national debt. It's for his personal finances.
He really wants the interest rate cut. Okay. He could spend like a whole podcast discussing interest rates and why it's super important to the overlord to have them that way.
So the narrative is being constructed to get the overlord what he wants. Regardless of the people in businesses, yes. Yes.
Second thing you have to understand is what the Fed has said in reference to rate cuts. Basically, they're in wait and see mode. They want to see what the tariff damage is going to be before they make any decisions.
And I actually think that's the right thing to do. Like kudos Fed, kudos Fed. Like you said in the last email that the Fed decided to hold it steady and they changed their prediction of just how many rate cuts to what rate cuts, two to one, one to two.
For what we've been hearing for months now is we're going to have at least two rate cuts in 2025. And now we have like 45% of the Fed saying they want zero rate cuts in 2025. And we have about 55% saying they want it one at the least, two at the most.
But they did drop it from two to one, which is why the market's plummeted. If there's a rate cut in 2025, it's going to be one rate cut. Unless something drastically happens where like unemployment shoots up, then the rate cuts out of the picture and it's going to be a rate hike.
But I don't think you would have- They're smart for waiting to see what actually the real numbers are coming in. And if you know what they look for, like that's why we went over this the way we did. They want, they look at inflation, economic growth and labor data.
So they want to avoid an economic slowdown, which is when inflation gets too low and employment gets too low and when economic growth is too low, they don't want that. So we currently have inflation above the 2% target. We have labor data that is showing bad shit.
We have a GDP that is trending lower. And they actually came out and said they cut it from 2.6 to 1.6. They actually cut 1% of the GDP of the forecast for 2025. So you put it all together, there's no reason for rate cuts right now, unless the overlord for the first time ever can admit he made some mistakes and show the real data.
Like, unless we get the real data, there's not going to be rate cuts. With all that being said, you have to invest that way. You have to invest with- Reality.
Reality, yeah. Which means what exactly? Well, the reality right now is the GDP is bad. It's probably going to go up and then it's going to get bad again.
The way the GDP is actually calculated, if it's the nerds out there, is they take the GDP minus the GDP from the previous period divided by the current GDP. So if you take that we had negative 0.2 the previous period, and say we get like 1% this period, so you're going to have 1 minus, you're going to have 0.8 divided by 1. So you're going to have a really, really, really small GDP growth for the quarter too. So you have to just know that going in.
You also have to know that the markets have been the same. At one point, we were at technically in bear markets in all three indices, only for the indices to respond with massive gains. Currently, we are up 2% year-to-date in the S&P.
We are up 1.4% year-to-date in the NASDAQ, and we are down 1.1% in the Dow. So does the data warrant these returns? This is where I actually differ from the majority of experts because I say geopolitical issues combined with interest rates maybe getting cut once this year combined with fallout from ridiculous tariffs not being seen yet suggests that sideways year for the indices is the best case scenario. So if you know that we're not going to have a lot of upward trajectory with the markets, then obviously you have to invest that way.
You want to remain in a semi-conservative mindset and invest in good dividend growing companies. I would say at least 50% of your portfolio should be in dividend growth companies. What the other 50%, I would say 25% can be in riskier investments such as Roundhill or Yieldmax or whatever, and the remaining 25% should be in cash, which means bullet shares or THTA or whatever you do for your cash in your own portfolio.
So that case, if there is a downturn, which I think there will be, you'll have plenty of dry powder to pick up more quality dividend growing. This year's are going to be all about dividend growth stocks. Yeah, and picking up when they go into those lower prices so that you can buy more shares and then actually have more payouts.
And if you missed our two portfolio updates for the second quarter of the year, our dividends increased 10% for the conservative portfolio and 13% for our high-yield portfolio. And that is in just one quarter. That is insane.
And that is even with this volatile roller coaster of a freaking climate. And that's because we're paying attention to the actual valuations of companies and we're waiting and being patient and buying when the actual numbers are right. We're not panic selling.
You still have to stick to your metrics. Yeah, you have to stick to your metrics no matter what. But you're also gonna wanna make sure you have some international exposure since the international indexes are just basically killing it compared to American indexes.
Some of them are up like 20% while we're like at 1%. So the international investments are really killing us. For me, the way I do internationals is I literally just find, I go into a closed-ended fund screener and I find closed-ended funds that hold a lot of good international companies that's trading below its historical.
Now, do those allow you to skip on the foreign tax crap? I imagine they would. No, you still have to pay taxes. No, no, no, no, no.
I don't mean paying taxes, but I think if you buy the foreign companies outright, I think you're obligated to different tax stuff. Well, that all depends where they originate because there's some closed-ended funds that are American. That could be a potential for getting around.
If you have an American closed-ended fund and invest in international stocks, that would be ideal. That's what I'm saying. You may be able to get around the extra tax.
If you find a really good international company that you just... Evaluations are perfect and you're gonna have to deal with the... First, you're gonna have to deal with international taxes and second, you're gonna have to deal with the currency exchange. But if we're going up 20%, it probably comes out in the wash. Again, there's that risk versus reward type deal.
Do you have any of those off the top of your head, ticker-wise? EDF, maybe. I literally just had that in the email. There was a foreign one.
I forget which one it was. As for gold and silver, prices are way too high to warrant putting more than 1% to 2% into that area. I know there's a lot of people that are super diehard gold and silver hoarders.
To me, they could go up, they could go down. But to me, it's like, if you get into gold at 3,600, you're not really gonna see a lot of advancement and I'm sorry, increase in your initial investment because it might go up to say 4,400 or something like that. But that's still only 6% or 7% when you can get that from an undervalued dividend stock plus dividend increases.
AEF is the emerging market that excludes China. AEF is a really good one. It's fairly undervalued and excludes China, which is actually ideal because China, we don't know what the policy is gonna be towards China.
So I would do EDF, which is basically an emerging, it's an emerging countries closing the fund or AEF, which is a Middle East, or I'm sorry, Far East companies, but excluding China. Those are the two I would start with. And those are pretty good from what your thingy says, the yield.
And that actually just came out. Again, if you were on the email for Friday, you would have had that information. And AEF is 20% undervalued right now with an 8.8% dividend.
Yeah, so you're gonna get like probably 30% return in like the next 12 to 18 months in that one. I just remember gold and silver, I wouldn't get into them. Instead of the gold and silver, I put it into crypto, mainly Bitcoin and Ethereum.
They can be picked up when there's a downturn. I know Bitcoin's pretty high, like 105 right now, but Bitcoin's projected to be over a million in the next couple of years. And Ethereum's at like 2,500, and it's projected to be well over 10,000 in the next couple of years.
So I would start, if you don't have that access in your portfolio, you might wanna start actually contributing to that. Now you don't necessarily have to go to like Coinbase or whatever, or Kraken and buy Bitcoin and Ethereum. You can do ETFs that handle it, like IBIT or ETH or YBTC.
If you wanna collect dividends while having exposure to not Bitcoin and Ethereum itself, but knowing that Bitcoin and Ethereum are gonna shoot up, and that's a way to go. That's what I chose to do with, I mean, we do have crypto, but that's what I chose to do in the portfolios that I just got into YBTC. And then I got into the LFGY, which is the weekly payer that is all the crypto companies.
And they're actually doing really, really nice. We actually have both sides of like actual crypto and the other, and they both work out really nice. So for 2025 and 2026, you wanna be semi-conservative.
This is what all that babble and all that basically says. All that boils down to, and getting in the undervalued things. Which means undervalued dividend growers.
They don't necessarily, you don't actually have to get into like dividend risk crafts, but you like, so if you say you wanna get into something that yields like 18%, at least make sure that it has a consistent dividend that hasn't been like cut in like the last say five years. That would exclude ABR. I like really like ABR, but I wouldn't get into ABR currently because it just cut its dividend from 43 down to 30.
But like JEP Hughes has been really good. That's a tech one. Like, so that's a pretty conservative play and you're getting access, you know, getting exposure to tech.
That's up to you. But that covers where the current data says the economy is at. And the economy is kind of in the shitter and it's gonna get worse.
I think before it gets better. That's my opinion. I could be wrong.
I hope I'm wrong. Cause I'd love for my portfolio to go up to like, you know, 150, 160,000. Yeah, it would be nice.
But I think best case scenario, it's just gonna be sideways. Yeah, sideways years are the best though. If you have dividend growing stocks.
But I'm saying like, I said that numerous times. High chance of going down, but best case scenario, we think it's more gonna be sideways, which isn't bad for dividend approach on either side. That's the absolute, in my opinion, is the absolute ideal market for dividend investing is when the market goes sideways.
So just have that dry powder, pay attention to the actual valuations. That's that. Of course.
And next week, we're gonna be doing this again next week cause I'm still gonna be in New Mexico, biking and doing whatever I do. Next week, we are going to actually address the question of why are people willing to overpay for stocks, but they're not willing to overpay for a house? There's like some psychological components that go into it. And it just bothered me because I'm reading stuff.
People are like, I'm not buying a house cause the housing market's too high, but these same people will dump like thousands or millions of dollars into the stock market. Well, historically, the stock market is way more overvalued than the housing market. So why are they willing to do that? So like they should, they're applying the sentiment, not across the board.
It's very conditional and selective. And that's like, what's going on with the psyche with that? Not that we agree with buying a house overvalued. We do not, but it's just a- I don't think you should buy anything overvalued.
Yeah, value. Facts. Everything should be undervalued, but that's not always the case.
So it's like, it's more like next week's gonna be more of a psychological thing. It's not going to really be a lot with- We just did a lot of heavy ticker ones. So we're going to pivot again back to the psychology aspect, which there's always good nuggets, always improvement and growth points in here.
Things to be aware of for yourself. This is something that I see a lot of people that do that, where like they'll like go and they'll buy a car that's expensive, but they won't buy like too polite toilet paper. Like, so what the hell is going on in their brain where they're willing to overpay on something, but they're not on other stuff? It's fascinating.
My one ex-friend's dad, they definitely look like they were rich, but they did have the shittiest toilet paper. And I was just like, I feel like there's something not lining up here. It was really funny.
And we're guilty of this too, because we have nice things, like we have the nice Jackery, we have the nice computers and everything, but like our food's from like grocery outlets. So why are we willing to overpay? If you looked at us, you'd think that we'd actually be more like cheap, but you'd be missing the fact that we actually spend a lot of money on the stuff that matters. I mean, unless you see us specifically walking around on their laptop or something, like you would never assume that we freaking don't have the full shebang.
It's more the overall picture. We don't suffer from the psychological biases and the different perspectives and things like that. We know that like the computer we buy is expensive, but we buy it for a specific reason for X amount of years.
But even then, like we'll buy a nice computer, like we always look to see if the computer is refurbished first. I will buy stuff on discount. I will look if you can upgrade the RAM and the hard drive and stuff on your own, save some money there.
But there is like a lot of psychology goes into that. And then that's next week. The week after that, I might just do like a, like the best closing the funds to buy currently based on the current market conditions, because I think closing the funds should be a very integral part of your portfolio.
I don't think they get the love that they should. We'll see. I think it will depend on if anything happens, which is always subject to change because shit changes every 25 minutes.
It seems this year. Other than that, I'm done. Hopefully this helps you understand where the market is at so that you can invest accordingly.
Because the macro trends have, like when we did this in November or December, I forget when we did like where the macro trends for 2025, well shit changed. A lot. The macro trends are changing with them.
So like, this is just an update on the biggest areas of them. I mean, we didn't go into like specific sectors, but this is like the economy as a whole so that you know that the economy is- Stuff is way worse than they're portraying. It is bad.
So you need to invest with the mentality that shit is bad. Yeah. And you really, really, really need to focus on value.
Like that's one of the biggest takeaways from this whole thing is because things are so bad and sketchy and potential on the edge of falling off a cliff, if not just going sideways, you need to pay attention to the value because you get in something, then it drops 20%, like you're going to be jumping off buildings and we don't want that. And I'll probably have a longer beard next week. I'm growing my New Mexico beard.
Check this out. Yeah. He won't be able to handle it.
He can't handle it. It gets frigging hot and itchy. But I might, what I want to do is I want to leave the old timey stuff, which is remember like they had the sideburns that come all the way down here and then they cut all this off.
So I might be an old timey Tim next week. We'll see. But all right.
Thank you. Thanks for tuning in. Have a good week.
We'll see you guys next week.