Be An Informed Consumer

 

Dr. Emrick's Books, Blogs, and Podcasts

First, let me proclaim that I am not a political pundit. Those who know me will tell you I steer clear of political debates. I have always maintained an open mind when it comes to politics. This means that I want what is good for all of us Americans. I am a truth-seeker who is unbiased and driven by facts. But, as an everyday consumer, I’ve been watching what’s happening with the U.S. economy in the past 24 months, and let me tell you, it’s not looking pretty. Things are pointing toward a big slowdown, hitting us regular people right where it hurts: our wallets, homes, and jobs. First off, the economy’s been running on fumes, propped up by some wild government spending under the Biden administration. We’re talking deficit spending at 8% of GDP; that’s like maxing out your credit card to keep the party going. The last time things got this messy was the 2008-2009 housing crash; we all remember how that felt. Right now, the deficit’s ballooned to $2 trillion. You might be wondering, “What crisis caused this?” Well, some say it was all about keeping Biden in office, pumping money into the system like it’s Monopoly cash. One big piece of this puzzle? Illegal immigration. Reports are estimating 15 to 20 million undocumented folks have crossed the border, and it’s not just a random surge. Economists are starting to think it was a deliberate move, backed by the government and shadowy nonprofits (NGOs), to juice up the economy. The Department of Government Efficiency (DOGE) is digging into this, and what they’re finding is wild. These NGOs were basically funnels for trillions of dollars, paying immigrants to keep the economy humming. The catch? The Treasury had to print more money to make it happen, and that’s driven up inflation, making groceries, gas, and rent way more expensive for us regular Joes. The middle class? We’ve been in our own quiet recession for a while now, even if the headlines didn’t say it.

Speaking of headlines, those rosy job numbers you’ve been hearing? Turns out they were fluffed up, partly by counting jobs from illegal immigrants and government job growth. Real estate folks will tell you the truth: home sales are tanking across the country. I mean, who can afford a house when property taxes are through the roof and prices won’t budge? Add in global trouble, like Europe’s real estate slump and China’s economic wobbles, and it’s a recipe for a worldwide mess. Inflation’s been a double whammy. Between the Fed printing money during COVID-19 and this immigration boom, costs have soared. Back in April 2023, unemployment hit a low of 3.4%, which economists now know was all a ploy to get Biden re-elected, but now it’s creeping up to 4%. Last month’s job report was a dud, only 143,000 new jobs when experts expected 169,000. That’s got me wondering: Are we about to see layoffs piling up? You can see it at the places we all shop and eat. In 2024, big names like McDonald’s, Starbucks, Costco, and Walmart started saying their customers were tapped out. McDonald’s is pushing a $5 meal deal, and Wendy’s has a $3 breakfast bundle. That’s not just a sale; it’s a sign we’re all tightening our belts. Companies are scrambling to get consumers back in their stores.

Enter the Trump administration, which is trying to clean up this mess. When Trump first took office in 2016, federal debt was $19 trillion, and the deficit was 3% of the GDP. Now? Debts at $36 trillion, growing $1 trillion every 100 days, and the deficit’s hovering between 6-7%. They’re aiming to slash that back to 3% by 2028, which could steady the ship. But it won’t be easy. Government spending is like a runaway train, and there’s talk of an “AI bubble” propping up the stock market. If that pops, we could see a 30-50% drop. Yikes. The stock market has been a rollercoaster, with S&P and NASDAQ up 25% over two years, driven by tech giants like Apple (now worth over $3 trillion!). But dig deeper, and it’s all about the AI hype. Companies like Microsoft and Google are pouring billions into AI, but where’s the payoff? It’s starting to feel like the dot-com bubble all over again—tons of spending, not much revenue. So, what does this mean for us? If you’ve got a 401(k), take note: Warren Buffett’s sitting on $350 billion in cash, waiting for the storm. It'll ripple everywhere when companies start cutting jobs, and they might soon. For now, what is my advice as a fellow consumer? Keep an eye on your budget. Those $5 meals might be a lifeline but also a warning. We’re in for a bumpy ride, but if the new policies work, Trump hopes to become stronger by 2028. Hang in there!