by Michael
I do know that issues aren’t nice proper now, however please attempt to benefit from the subsequent few days, as a result of it seems that financial circumstances may shortly get an entire lot worse after Thanksgiving. I perceive that could be tough for a lot of of you to listen to, as a result of we’re already coping with a lot. The worst inflation disaster in a long time has been eviscerating our lifestyle, main layoffs are being introduced all around the nation, the housing market has began to crash, and the fallout from the collapse of FTX threatens to push over extra monetary dominoes within the weeks forward. Sadly, now we probably have one other main downside so as to add to the record. One of many largest rail unions simply voted down a tentative settlement, and so now a nationwide railroad strike in December is a really actual risk…
The probability of a strike that may paralyze the nation’s rail site visitors grew on Monday when the biggest of the 12 rail unions, which represents principally conductors, rejected administration’s newest providing that included 24% raises and $5,000 in bonuses. With 4 of the 12 unions that signify half of the 115,000 rail employees holding out for a greater deal, it would fall to Congress to impose one to guard the U.S. financial system.
Now that SMART-TD has develop into the fourth union to reject the tentative labor deal that was on the desk, preparations for a crippling nationwide railroad strike that may start early subsequent month will quickly transfer ahead.
Such a strike would cripple 1000’s of provide chains from coast to coast, and even CNN has been pressured to confess that an prolonged strike “may trigger shortages and better costs for items together with gasoline and meals”…
If a strike goes on for an prolonged interval, it may trigger shortages and better costs for items together with gasoline and meals. If the 4 unions that rejected the offers are unable to succeed in new offers earlier than strike deadlines, Congress may order the railroad employees to stay on the job or return to work.
The excellent news is that this labor dispute will finally be resolved a technique or one other.
However even and not using a nationwide railroad strike, most consultants had been already forecasting a dismal month of December.
In keeping with the Wall Road Journal, customers and companies are each “bracing for a humbug vacation season”…
Households, retailers and charities nationwide, feeling the pinch of inflation, are bracing for a humbug vacation season.
U.S. customers and companies have trimmed spending plans for items, charitable contributions and vacation occasions, knowledge present. The penny-pinching threatens to spoil the year-end for a lot of, particularly companies and nonprofits that tally their largest share of gross sales and donations in November and December.
The Federal Reserve has been waging a struggle towards inflation for months, however costs simply hold going up.
Actually, it’s being reported that a mean Thanksgiving dinner will price about 20 p.c extra this 12 months than it did final 12 months…
American households may have an unwelcome visitor on the dinner desk this Thanksgiving: inflation.
A Thanksgiving meal for 10 will price $64.05, a 20 p.c improve from final 12 months’s common of $53.31, the American Farm Bureau studies.
The centerpiece on most Thanksgiving tables – the turkey – is a giant driver of the rise. In keeping with the Farm Bureau,the typical worth per pound is up 21 p.c from final 12 months.
In the meantime, job losses will fully spoil this vacation season for 1000’s upon 1000’s of Individuals.
Sadly, lots of the jobs which are being misplaced are good paying jobs. For instance, Cisco simply introduced that they are going to be firing over 4,000 nicely paid employees…
San Jose-based tech large Cisco plans to put off over 4,000 staff, in line with a report within the Silicon Valley Enterprise Journal and later corroborated by the San Francisco Chronicle.
In a transcript of Cisco’s Q1 2023 Earnings Name printed by Motley Idiot, Cisco Chief Monetary Officer Scott Herren characterised the transfer as a “rebalancing.” Chairman and Chief Government Officer Chuck Robbins mentioned the corporate was “rightsizing sure companies.”
At one level, the typical worker at Cisco was making $109,000 a 12 months.
These which are dropping their jobs gained’t be capable to exchange these incomes simply.
On high of every little thing else, U.S. customers at the moment are seeing their residence values begin to fall because the housing market crashes.
As I mentioned earlier this week, residence gross sales had been 28.4 p.c decrease in October 2022 than they had been in October 2021.
That may be a nightmare determine, and people who work in the actual property enterprise are beginning to really feel the ache.
Actually, Zero Hedge is reporting {that a} whopping 37 p.c of U.S. actual property brokers couldn’t pay workplace hire in October…
Increased borrowing prices triggered a pointy drop in mortgage purposes and residential gross sales within the again half of the 12 months. Deal movement is drying up for a lot of actual property brokers, leading to monetary duress that will worsen into early 2023.
In October, a stunning 37% of actual property brokers struggled to pay workplace hire — a ten% improve from the prior month, in line with Yahoo, citing a brand new report by way of Redfin. The determine may worsen because the housing market quickly cools by way of the Fed-induced demand facet crunch.
That’s greater than a 3rd of all actual property brokers!
Sadly, that is just the start.
Our financial momentum is taking us downhill fairly shortly now, and it isn’t going to take very a lot to show this downturn into an avalanche.
At this level, issues are already so dangerous that best-selling creator James Rickards is warning that “this factor goes to fully crash” and that “we’re in for a worse disaster than 2008″…
Rickards factors out, “Why does Warren Buffett and Brookshire Hathaway have $130 billion in money? Buffett is without doubt one of the biggest buyers of all time. Why isn’t he on the market shopping for shares? Once more, why does he have $130 billion in money? It’s as a result of Buffett sees what I see. Sure, this factor goes to fully crash. It’s a very good thought to have money as a result of you may buy groceries within the wreckage and decide up some bargains. My level is, we don’t must guess. Have a look at the Treasury yield curve. Have a look at the euro/greenback futures yield curve. Have a look at different metrics, and guess what it appears to be like like? It appears to be like like 2007. Every thing I’m describing, however not fairly as excessive by the way in which, was true in 2007. . . . These euro/greenback futures had been behaving then precisely as they’re now. Besides now, the inversion is even worse, which implies we’re in for a worse disaster than 2008. It’s coming. Every thing I mentioned has nothing to do with FTX. Throw FTX on high, and as I mentioned, you’re throwing gasoline on a hearth.”
If Rickards is right, what’s going to our nation seem like a 12 months from now?
You would possibly need to begin excited about that, as a result of the occasions we’re transferring into might be in contrast to something we have now ever seen earlier than.
However most Individuals don’t need to hear this.
Most Individuals simply need to blindly imagine that our leaders in Washington have every little thing underneath management and that they are going to be capable to make things better.
There’s definitely nothing improper with hoping for one of the best, however in the meantime you may additionally need to begin making ready for the worst, as a result of issues are beginning to get actually loopy on the market.
