In Wednesday’s YouTube video, I talked briefly about the smoke and mirrors that the government is using to mask how bad our inflation numbers truly are in America at the moment. It is not like the 8.3% number that was reported was not bad enough, but things are truly much worse than that, and they are hiding it in the gas and oil line items, as those two lines are very deceiving. I just happened to receive a report this morning that agrees with my thoughts on this, so I thought I would share it with you this morning. This research company states almost verbatim what I was already sharing with you.

Brownstone Research states the following:

“What a disaster. Yesterday was ugly.

We’d have to have been hiding under a rock to have not heard that the consumer price index (CPI) came in much higher than expected – 8.3%. Needless to say, this is not good… but sadly, it’s not surprising.

In the absence of major changes in both economic and monetary policies, we should expect persistent inflation.

While the headline number of 8.3% was all the talk yesterday as the stock markets collapsed, very few were actually looking into the real drivers behind the number – and that’s where things get a lot more interesting.

That’s because almost every category that contributes to the CPI number increased in August. But two line items stood out: gasoline and fuel oil, which both materially declined. The price declines in both categories were so significant, that without those declines, we would have had even higher inflation than we had in June… well above 9%.

Why is that? What is driving down the price of gasoline and fuel oil? 

It’s simple, the U.S. government is emptying its strategic petroleum reserves at a record pace never before seen in history:”

You can read the rest of this story at Brownstone Research’s Strategic Petroleum Reserves.

At some point, likely after the midterms, Biden will no longer be able to pull from these reverses, and Biden is paying $80 per barrel to restore them. Once the siphoning off of the reserves is over, gas prices are going to start rising again. Add to the fact that we are spending $80 per barrel to refill the reserves, and they will only have to print more money, creating even more inflation.

If you want to understand what inflation does, just look to history. The 70s are a great example of what happens when inflation is completely out of hand. The price of everything is going to continue to rise, so the best way to offset this is by owning and holding assets that appreciate. While it won’t help your bottom line as far as the erosion of your paycheck, assets will at least offset some of the damage of inflation, so keep that in mind as we grind through the remainder of the blunders being done by our leaders in Washington.

One has to question why our leaders continue to make horrible policy decisions like the blunders we are seeing almost daily from Biden. The truth probably hurts, but the US is in such deep debt that the only way we can see any light at the end of the tunnel is through inflation. Our government is going to inflate its way out of this debt, and it will come at the cost of the citizens like you and me. Do not let them snooker you with lies and deceit. Do your homework so that you understand what is truly happening behind the scenes and don’t believe anything you read or hear in the media, as they are all in on the fix.

If you want to know what is really happening, you have to spend the time to research and do your own homework. Otherwise, the media will sell you a pack of lies that sounds too good to be true. They will blame the problems on anything and everything other than the real truth, our leaders in Washington. Stay vigilant and prepare for an inflationary economy, and you will at least be somewhat prepared for what is coming down the tunnel directly at us.

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Comments

DavidMcCoy September 15, 2022 at

How do we prepare for inflationary economy? We own our homes and cars, our salaries are flat and costs of necessities rising? The squeeze is on….. I don’t have a money printing machine like the government?
All is well, no panic just asking God for wisdom

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    Mack September 15, 2022 at

    If you can, buy assets as they implode. It’s similar to buying stocks. Buy when everyone else is selling. It’s hard to convince yourself you should be buying in a down market, but that’s when the deals arrive. Don’t try waiting for the very bottom either, as you will miss the boat if you try and time it to the very lows. I missed some great real estate deals during Covid thinking prices would go lower, and then suddenly there was nothing left and prices were skyrocketing. Buy low and sell high, just make sure it is assets that appreciate.

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    Raymond September 15, 2022 at

    If you can learn the technicals of trading and then pass the psychological “test” through trading live with real capital then you can essentially “print” (scalp out what you need from the market daily).. Invest in revenue producing assets and if you are savvy, if and when interest rates hopefully drop, get a fixed rate mortgage on a portion of those properties that are producing profits. Holding a long term fixed rate (below 4%) note on an asset and you are essentially shorting the us dollar.. just be careful and not chase real estate in this crazy market. When the time comes to buy, you’ll want deals in the linear markets not trending areas (nothing on coasts).

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Bob September 15, 2022 at

Pretty good research. What’s the most sad part is that it doesn’t matter what is known or unknown, people are still going to vote for the lifers that promise the most “free” stuff and they will in turn continue to take it from EVERYONE not just the “rich” guy as they think. Most of the time when these people are elected I see it as a path to sell high, and buy low at the end of their term. Owning a recession proof business like pest control I am not as worried. My long term investments have been significantly impacted and will continue in that direction with an alzheimers patient at the helm.

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Raymond September 15, 2022 at

Mack, I appreciate that you are taking this extra step to educate all of us especially the younger aspiring traders here of what is really going on in our economy. We all know you have enough on your plate with just teaching us here on trading this system… A big THANK YOU goes out to you. Hopefully I can have a success story to share with you from my trading journey. Blessings to you and your family!

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garrett September 15, 2022 at

I’m all for getting assets in a down market and not being afraid to make smart moves! But laying inflation at the feet of a President just over halfway into his term seems more about politics than money. Too bad- the forum and this website are usually politics- free :/

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    Mack September 15, 2022 at

    I wrote this about as “politics-free” as possible. Whether you like Biden’s policies are hate them, they are the reason we have low oil/gas supplies right now and supply and demand are what drives the prices. Low supply, high prices. High supply, low prices.

    The low supply his policies have created are why he is pulling from our strategic reserves. He is now trying to increase supply, which in turn has lowered gas prices, albeit temporarily because he can’t draw from the reserves much longer. Change the policies and increase supply or we all suffer higher gas prices in the near future. I’m not arguing if his reasons for his policies are right or wrong, I’m just explaining why we have what we have, and it’s directly related to Biden’s policies on oil production here in the US.

    I would tell you not to believe anything I say either, but instead, do your homework and educate yourself on his fossil fuel policies so that you know for certain. Every economist I watch, and follow, is saying the same things, and some of these people are actually democrats, so you can’t just assume I’m Republican and hate democrats, because I don’t hate anyone. I have close friends and acquaintances that straddle either side of the fence, and I don’t plan to not have friends on both sides.

    If you think his policies are good, that’s fine, as who am I to tell you differently. I think they are bad policies for Americans, but I won’t hold anything against anyone that likes his policies. Pitting Democrats and Republicans against one another is how they will divide us. Just because we don’t always agree, doesn’t mean we have to hate each other and cry foul at every turn. There have been two parties since the beginning, and we have always made it work. Ask yourself why suddenly it isn’t working and why are they are pitting us against one another?

    I would also add that I don’t believe Biden is making these decisions. Someone behind the scenes is calling the shots. If you listen closely, Biden has already told us who is calling the shots, and that is the WEF. He is adopting their policies on fossil fuels and pushing America to adopt all of their polices (the great reset he keeps bringing up), and this is hurting our economy.

    Again, I’m trying to be as neutral as possible in saying all of this. I’m really just the messenger here, and if you feel like my message is incorrect, then that is OK, you can freely say so and I won’t take it personal, nor will I retaliate. I don’t hate, nor do I dislike people that have different ideas and opinions than I do. That is the great thing about America, or at least that is one thing that used to be great here. You could be anyone you wanted, and you can do it freely without persecution. Today, not so much! Tomorrow, maybe even less.

    But no, if this came across as a political message, I apologize, as that was not my intent. I have indeed always tried to keep politics out of things here. I only spoke about policies and their effect on our economy and bank accounts, or at least that was my intent. All are welcome here, liberal or conservative, and everyone in between. I will always treat everyone as equals, because that is the right thing to do.

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    ifod105 September 15, 2022 at

    Then who do we lay it down on? It is what it is. There is no political bias. Whoever is the leader of the country is to blame for the bad and should get credit for the good. That’s how it works. Any administration trying to redefine ‘recession’ is being idiotic, and any politician who voted for the Inflation Reduction Act should be blamed for their lack of common sense. Yes, let’s pour more water in hopes that we can reduce the flood. Gas prices and inflation were up significantly prior to the war. Over 40% of all dollars in circulation were printed in the last three years. Trump/Biden administrations are responsible for this idiocy but only one of them is in the WH.

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garrett September 15, 2022 at

Ok yeah but when are we gonna discuss the elephant in the room? There’s a once in a lifetime pandemic that is still killing 3000 Americans a week. Like 9/11 every week. So, back in 2020 we could choose austerity measures or stimulus. Suffer early or suffer late. We, red presidents and blue, chose stimulus and now we pay for it later. And now the fed steps in, and now we get squeezed. Completely unavoidable. Because it was a once in a lifetime pandemic. We’ve all already forgot when the ICUs were overrun.

Fossil fuels are one part of the picture and whether they were offset by reserves or not, post stimulus economy was still was going to be a bear.

Back when the pandemic destroyed the employment numbers under Trump, liberal media had a big party about it and it was ridiculous. I’m as liberal as they come and I knew it was just ridiculous.

This feels like the same thing, just with a red slant on the run up to the midterms. Like somehow this inflation is in a political bubble- not preceded by a pandemic and fueled by a crazy Putin war.

On the other hand, this forum, this fantastic PATs is totally politics proof. It’s a chance to elevate right above all this BS. that’s why I spoke up. It should stay that way. I’ve been here since fall of 2020 and this is the first time I remember a President named ever.

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garrett September 15, 2022 at

That being said, I know I’m just one member and I don’t post as much as many do. Even if this devolved into a politics heavy site I’d just come back for the success stories, the Vladi stories and the irreplaceable encouragement from Mack. So, so grateful to you and this community Mack.

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    Mack September 16, 2022 at

    Glad to have you here Garrett. I won’t make many posts like this one, but I felt it was important for people to know what we were looking at coming down the pipe. The message is inflation is coming back with a vengeance, and no matter why that is happening, we all need to prepare for it. Those that understand and prepare properly can come out better on the other end, and those that choose to blindly follow our Washington leaders, both Republican and Democrat, will likely get left holding the bag. I am of the belief we need a cleansing in Washington. The days of lifetime politicians needs to end, and we need to get back to government for the people instead of for the bureaucrats. I don’t think any of them, Republican or Democrat, have our best interests in mind. They are all bought and paid for by people and entities that do not have our best interests in mind.

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      garrett September 16, 2022 at

      I am 100% with you on this!

      Reply

    Mack September 16, 2022 at

    All dreamed up and headed by some of the richest men in the world. Go figure!

    Reply

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