Tough Times
Rising inflation, Dropping housing market & Accelerating insider sales
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There is no easy way to put this - the middle class is getting screwed. Recent reports state that 75% of middle-class households say their income is falling behind the cost of living. This is partly due to the rising inflation and partly due to the fact that our unchanged minimum wage when inflation-adjusted is at its lowest value since 1956! This is causing more and more Americans to take up second jobs to make their rent. To add insult to the injury, guess who are they blaming for it?
But in all seriousness, things are looking bad at least for the short term, and given the tough times ahead it’s important to discuss what you should and should not do.
Middle-class Savings and Investment Act
Our generation is spending a lot of money and the Congress now wants to do something about it. So, they created two brand-new proposals.
Middle-class savings and investment act
Inflation relief act
Both are aimed at giving tax credits to those who are willing to stop spending their money. Let’s talk about exactly what these new proposals mean, how they would reward people and if this would be enough to bring down the rate of inflation.
2022 Real Estate Market
I usually don’t make informal videos without a whole bunch of charts, graphs, and fancy research, but something needs to be urgently said about the current state of the housing market. I don’t think we can be truly prepared for what is about to happen. With everything going on from declining home sales, sky-high home prices, and rising interest rates, I wanted to give you my completely unfiltered outlook on the future of the housing market.
Buy Low, Sell High
When retail traders were celebrating the stock market’s best month since Nov ’20, corporate insiders have been selling their stocks at the fastest pace since the start of this year. This might be a leading indicator for a drop as historically insider transactions have predicted the stock market peak in 2008 and the market bottom in 2009.
With the help of some fantastic research from Market Sentiment, let’s have a detailed look into what insiders are selling, what this indicates for the future of the stock market, and whether what we are seeing now is just another bear market rally.
This week, I have a recommendation for you…
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So that’s it for my Sunday round-up. For the new folks here, in this newsletter, I give a quick recap of whatever you may have missed over the week on Sunday, and on Wednesday, I will be doing my deep-dive article on one of these topics.
See you next week with another bunch of exciting videos!
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1. The middle class does not earn minimum wage- as they could not be part of the middle class.
2. Inflation is squeezing the middle class and it to shall pass- and it may take a year or two for the supply chain to clear- caused by the disruptions from the pandemic and the war in the Ukraine.
3. Taking a longer view (50 years) the middle class has shrunk because they have migrated to the upper class (PEW Research).
4. Looking through the long lens of history- these are the best of times (pre-pandemic).