Watch Prices

Our President is pushing the notion that everything we buy should be American made. In theory, fine, but here's the snag. Companies will have to pay American workers more, a lot mote, than they pay folks in Malaysia or Guatemala. They, even if they are still seeing obscene profits, will pass that cost onto you. Even of they get that promised huge tax cut, they will pass that increased labor cost onto the consumer. This is not a very moral behavior, but businesses are not known for a deep interest in moral behavior.

So, we will see inflation. When you stop seeing all of those cheap imports from China and India at your local Walmart, you, the consumer, will be aghast. Here's what you need to do.

Inflation tends to spiral. It grows rapidly. The Fed will try to control it by manipulating interest rates. That will work to some degree, but there will be inflation. That raise you just got, if you're lucky, will not seem so big. Neither will your savings, if you have any. Eventually, the cycle will reverse, at least it always has, but no one will know when.

When you see prices rising (do not depend on government statements about interest; they only monitor certain products and services), start buying a few extra items. I am not encouraging hoarding, just stocking up on essentials, non-perishable foods, clothing, etc. Remember, your money will be worth less, so buy while the prices are lower.

Do not resort to credit. Remember, the Fed will be playing games with interest rates. Also, and it pains me to say this, don't worry a lot about saving money until the trend reverses. Remember, a $1000, in a time of inflation, is worth a lot less than it did when you put it in the bank. Also, watch those interest rates. If you lock into an account giving 3% interest and inflation jumps to 5%, you are locked into a losing deal.

For the moment, keep paying down debts and saving a little. Who knows? All of Trump's plans may fall a part and the economy might just keep staggering along as is. But, if you see prices creeping higher, be ready and act.

After the Election - Watch Your Back

I do not use this blog for politics, but today, I am making an exception. The elections will be over soon and no matter who you support, watch your back. No matter who wins, things will not be good. If either candidate gets control of congress and thus gets their way, you will see the deficit, the National debt, go through the roof.

Both are proposing programs that will cost unbelievable amounts of money. On problem, we are broke and deeply in debt. Yet, they are both proposing tax programs that will not come close to even balancing the budget, must less paying down the massive debts.

This makes our standing in the World economy a wee bit shaky and this will effect both the value of the dollar and the willingness of foreign governments to invest by buying our Treasury bills. Add to this the pledge both behave made to raise the minimum wage (which will just be passed on by increased prices) and the shakiness of our economy and you will, I guarantee this, see inflation and job loss. This is called stagflation and it is a nightmare.

In addition, medical costs are rising, in large part due to the incredibly stupid mess of Obamacare. How long gas prices will stay low depends on the whimsy of the Saudis. Increased oil prices drastically effect food costs as well as home heating.

Things will not be good. The solution? First, stay healthy. Even if you are insured, not only are your premiums going up, your deductibles are also rising. For example, in Arizona, you will likely have a $5000 + deductible. So, stay healthy.

If you have a job, keep it. Hold onto it like grim death. If you dislike your job, learn to like it. If you become unemployed, you will be in deep difficulty.

Most of all, pay down your debts as quickly as possible. If that means skipping a ball game or a dinner out, live with it. If that means your kids can't have the latest, most fashionable shoes, they'll get over it. Do not put Christmas on your charge cards. Again, no one likes cutting back, but you really need to get rid of your debts.

Learn to do as much as you can around your home. A lot of repairs are simple. It is easy to cook instead of depending on take out and cooking yourself is cheaper than buying frozen dinners. Do it yourself, within reason, should be your motto.

Eventually, things will perk up again, but you have to be sensible. Watch your back. Watch the backs of friends and family. You have to, because, Uncle Sam is not going to be your buddy for a while.

Stay Away From The Stock Market

We all like making money and the Stock Market seems, to some, to be a good way to do that. Maybe, at times, but not at this time.

I am not an economist or any sort of financial whiz but I come from a long line of gamblers and con men. I know when someone is trying to hustle me. The current rise in the Market to record highs is a scam. Do not get caught in it.

There are no reasons for the Market to keep rising. The economy, as shown by the last GCP report, is sluggish. Unemployment figures are manipulated. For example, if you do not look for a job in 4 weeks, you are dropped from the unemployment roles. If you take a part time job, you are dropped from the rolls. The real unemployment figures are around 20%,  higher if you are black or Latin and sky high for all young people. This is not to mention those who have settled for low paying jobs that don't pay the bills.

Inflation rates are said to be low. That is true in some areas but food medicine and housing, especially rental housing, are through the roof. Senior citizens are getting no cost of living increases.

Add into that the fact that the payments for Obamacare are eating into family budgets and the rates are going up. Top that off with the massive debts young people are coming out of college with. The economy is not good, not at all. Yet, the Market keeps climbing.

There was a big drop right after the Brexit, the the rapid climb began. Now, there was absolutely no reason for that drop except that the Media went into a frenzy of doom saying. The investors saw the prices drop and bought low. Soon, they will sell and reap huge profits. At the same time, prices will drop and, once again, the average investor will be the one hurt, and hurt badly.

Do not gamble your money on Stocks. You may as well take a trip to Florida, head to Gulfstream Racetrack and put it all on the longest shot in the first race.