I know this goes against the feeling in your bones that the dips must be bought. I'm begging please for the love of everything don't buy the dip. The economic signs are looking atrocious.
- The Fed is still fighting half-century high inflation. Last month saw a slight decline in yearly inflation and this decline was largely due to a decrease in energy/oil prices. Even with this decline I must remind the bulls that prices are still increasing at over 8% yearly. The core monthly CPI actually increased 0.3%.
- Russia has severely reduced and outright halted gas flows to many European countries, who are seeing a massive increase in their electricity bills to the point of grid overloads, energy rationing and blackouts. In the UK, it is estimated that individuals see an increase in their bills from around 1300 pounds in 2021 to 4200 pounds in 2022. The energy bill is projected to cost twice an individual's monthly salary in 2023(per Trades Union Congress, UK). And Boris Johnson lacks any incentive or will to do anything about the issue, so this will remain unresolved for the moment. Per Bloomberg, Poland faces a 180% energy spike. Germany power prices have almost tripled this year. Per Enerdata, Italy's prices have closed to doubled. And the list goes on. All this mind you, with just a few months to prepare before winter. ALOT of European money will exit the markets.
- We can look at the jobs numbers. 528,000 jobs were added to the economy. and the unemployment rate edged down to 3.5 percent, a historic low for the past half-century. About 170,000 jobs were added according to the household survey. Interestingly, we actually lost about 71,000 full-time workers and added around 380,000 part-time jobs. The amount of multiple job holders increased by 92,000. Why would people suddenly need to work multiple jobs? Things are looking rough.
I also mentioned we are at a historic low for unemployment. That may sound good, but take a look at the graph below. Every single time unemployment hit historic lows the economy went into a recession. (Recessions are highlighted in grey).
- Consumer Personal Savings is taking and absolute swan dive meaning everyone will be . strapped for cash. The University of Michigan survey expected real income to absolutely . plummet. The amount of credit card debt from May to June has shot up by 60% continuing its . upward trend and increased. And the dollar price is going to the moon so there's less money in . the economy.
Personal Savings Data
University of Michigan Consumer Survey
https://preview.redd.it/yu524fdvdwi91.png?width=143&format=png&auto=webp&s=0580d9b106262d2f2c77ab398e39f589f12307f9
USD Price(Trade-Weighted)
Folks be careful out there. Many have already lost enough from the many we-know-who collapses. Don't take any risk you don't have to.
