foundation let it be an arms race is often very dramatic. developments only personally, i'm going to resist. i don't see how that strategy will be successful. very critical time. time to sit down and talk the hi. am i guys are this is the kaiser report? i think it, we go through the record you find out for the past 5 years, we've been the only media outlet in the world to accurately predict that interest rates are going to continue to go down the central banks. we're going to continue to buy a securities and that money printing would continue and that inflation would break out. and this is exactly what's happening and now we've got some updates, stacy?

yes, money printing will continue until morale improves. and basically, this is the message from joe biden, the president united states to jerome, how the head of the u. s. central bank. the federal reserve bank bite in the fed should take whatever actions are required to help the economy recover. so whatever it takes, he's saying to the guy who all he can do is print more money issue more credit, right? it's not like he's going to go out and build the plant manufacturing plant and produce wealth. no, he's just a guy who could issue more credit. yeah, i mean it's, it's fascinating because when the president in states is talking about helping the economy. yeah. get, what does he mean when he says the economy. okay, what is he talking about? and because as you point out, the jobs have been shipped to china, the insurance companies and bankers have been engaged in wholesale gouging and

price gouging, and larceny and fraud on checked. the money printing is the problem. and what joe biden is suggesting that to address the problem, he wants to double down a triple down and do more money printing. right? so what, what lunatic asylum does this man live in that j. j. powell lives in what we're, what wing of the psychotic? no man's land are they, are they residing, this is just called, you know, bubble, you know, they live in a bubble, literally and figuratively, where they're only hearing their own ideas. that academic keynesian sort of economics that is the only answer and the only cure. and if it didn't work the last time, it's because you didn't print enough so they keep on doubling down. and in fact, we're going to look at this fact the fed balance sheet more than doubled since 15 months ago from roughly 40000000 to over 8 trillion. nothing to see. as you can

see, there are doubling down in the past year on their failed policies. and of course, the bond market that we always refer to as like, much bigger than the stock market, though the ordinary citizen will look more at the stock market because they have a $41.00 k, maybe a little tiny one compared to the vastness of the stock market, but the bond market is even 2 or $33.00 times bigger than the stock market. so the bond markets, you know, started this week with a pretty contrary message to all the inflation talk, which is that they said, you know, rates that yield plummeted down to under 1.2 percent on the 10 year. so this was a huge move and shocked the markets, and that's what prompted, i think by them to say the fed to do whatever it takes, right. i think that's why our as journalist up come in really handy for people trying to make sense of all because the,

the purchase of bonds by the central bank to drive the interest rate lower. you know, we've been saying now for 10 years we've had gas and going back all the way to peter chef in 2008, who predicted inflation would break out because of all the money printing. and that was the, the, the consensus now for 10 years and we've had probably 50 experts come on this show and say, bond markets topped interest rates are going higher and they've been wrong 50 times or, and they're wrong again this way because the tenure bond is sitting another new all time low and it's heading to under one percent. it will probably had to under a half a percent. and is that deflationary? well, it's not deflation or inflation. you've got a rogue psychotic central bank printing money to buy bonds, to keep rates low, to appease the crocodiles and the headphone industry, who are buying up huge ways of the economy for their private gain at the expense of public good. and we're turning into

a neil futile household if i may use that expression. and so it's not inflation or deflation. it is however, causing a price shortages and be price inflation. that is, in fact disenfranchising in impoverishing more millions more americans, joe biden. you said price shortages, there is definitely a shortage of accurate price signals, but there are supply shortages. and this is the interesting thing. so 15 months into the doubling of the balance sheet of the fed, the loosening of money, they're sending out of stimulus, right. so trillions of dollars over 6 trillion dollars were sent to american households. and now we're starting. nobody's been working. nobody's. we've been locked down. nobody in the u. k. nobody in lots of parts of europe, australia, lockdown. somebody has to make that stuff for us though, that we're spending dollars. demi checks on. right, well this is interesting stuff from wolf richter because he loves that sort of

supply data. he loves it and it's a good site to go to wall street dot com and check that out, plunge of retail inventories collapse of new and used vehicle inventories turns out when the u. s. government spends 5 trillion dollars and borrowed fiscal stimulus over 16 months, and the fed hands out fortunately, and dollars and monetary stimulus over the same period, causing asset prices to boom. demand for goods is going to wash over the land. and so now me like waves and supply chains snake all over the world, amid finally honed justin time inventory strategies get tangled up as retail sales spiked in her storage. manner. shortages of all kinds have been cropping up, including the semi conduct a shortage that has slammed the auto industry with a vengeance. right? this is so messed up because the money printing 6 trillion. ok. so goes into people's pockets and they go on a mad shopping spray for washers dryers and cars, things like this,

which are manufacturer in china. and so chinese g, d, p is up to 18 percent. the u. s. is flat. so we're printing money and sending it to chinese workers and chinese factors until the moment when they develop shortages from another shortage is a good like microchips, the central's goods, the make, the economy work that shortages from taiwan from china. and so in response, the garbers gonna jo by the selling effect to go print another $6122030.00 trillion dollars do whatever it takes. ok, that means that we're going to spend another 20 trillion dollars at china. we're going to, we're going to cause another pattern, but china is going to say, you know, it, since all that stuff and shortage is we're going to raise prices, right? so china is raising prices. now they're the ones you are dictating prices. so we're creating a monster here. we created a frickin monster. we've got china, economy zooming. they can raise prices at will,

and no matter how high china raise prices for americans to buy their goods. biden's going to print more money to send to china. this is a worse to stop in chinese finger trap that ever been invented by 2 lunatics. but on the other point here, like we talked about the price signals all the time. and this is what has really set off this bermuda triangle of like do we know if it's inflation deflation? what's up, what's down are we, is our g d p increasing or decreasing? is it all, you know, we don't, we, there's no to in order to understand where you are in the context of the economy and, and history of the economy. you need some stable point, but we don't have stable points anymore. so manufacturers and retailers did the, you know, that their actual business people, right? they have to turn a profit, they have to pay their shareholders. when this pandemic hit, they just look at history. what happens when they shut down their shops and

everything? they assume people aren't going to spend that happened in 2008, you know, retail, the consumer stop spending. there was a crash in spending for about 12 to 18 months. his, they didn't count on the trillions of dollars going out. so the supply, the supply of inventory, they didn't order it thinking like, as we've covered with a semiconductor chips, they just assumed that nothing would happen, right? they didn't count on the binding box, the trump dollars, they didn't count on all that stuff. so now it's being drawn down and gobbled up, but people have so much cash. not only because they haven't spent in a year, but they're trying to spend it like they're trying to spend it, get whatever they want. they have pent up demand and you're seeing that in that total inventory at all retailers from auto dealers to supermarkets fell to $598000000000.00 worth and may. seasonally adjusted, which is down 9.8 percent from may of 20. 19 the 3rd month in a row of declines,

but still up from the low end of june of last year. these inventories may and retail sales or may, which had declined from april, produce the 2nd lowest inventory to sales ratio in the history of the data, going back 219-0902 the lowest, having been an april. so here's this chart of the inventory to sales ratio. and i mean, you just know that looks crazy, right? it looks we are seeing otter and otter charts. it doesn't matter what it is, whether it's the price of money, whether it's the price of energy, whether it's our inventory, whether it's whatever we've seen crazy charts over the past few years and this is get another one. hopefully, we could all like in during get through possible delta various locked downs and, and more stimulus jacks, because it looks like the inventory is being depleted. that's what's causing the ability for china to have price, you know, flexibility, rate prices. and so it's also feeding massive corruption because the people who are

closer to the money purchase here in washington, d. c. their price insensitive, no matter how high china raises the prices for any product. the people who washington like nancy pelosi who husband has been trading on inside information now for a few years. and her network went from 40000000 over 100000000. it's fully documented, it's legal for her to do so. it's not legal to try to sign information. she doesn't care of china raising the prices of washing machine or double that she just has her husband write a check and he calls wall street says, what's the hot kit? and then he, they send him a few $1000.00 and then she buys a washing machine, she's immune to you. but the point is like if, if china has to shut down again like that, the amount of st. basically we've been depleting the inventories over the past year and everything seems to be ok. just sense stimulus checked. the people are going to assume that based on the past 12 months, we can just keep on sending stimulus checks and everything will be fine because there's always something in the shit supermarket at the shop,

whatever. there's always something to buy. but at the end of the day, can we tolerate another break to the supply chain globally to globalization, to these ships arriving with goods from china. like what, how we're, we're all counting on them not having to lockdown again while we ponder. whether or not we should locked down again. no, that would be equivalent to a meteor strike. as actually, there would be like a meteor getting planet or if we have another complete breakdown of supply chains as we did during comp it, we had another one. now, it would be equivalent to media or striking planet or that's, that's all what happened to the economy, whatever it takes that's provided by a media or struck planet. earth biden would call the fed and say, we need you to print that $500.00 trillion dollars. right? now because of the media or, and j pow who would be a sender sitting on a box next to a vault with nothing but hamster booth would be available to accommodate him. well, whatever this is what they believe they think we need world war or alien invasion.

this is the case in academic thinking. i was telling you about at the top of the show, this is what, whatever it takes is something like that. so don't give them ideas my so go long hamster poop. i understand. that's the new medical jani. all right, we're going to come back after the break. don't go what the me ah, ah ah, ah, use oh right now there are 2000000000 people who are overweight or

obese. it's profitable to sell food that he's fancy and sugary and healthy and addicted. not at the individual level. it's not individual willpower. and if we go on believing that will never change, that industry has been influence. think very deeply, the medical and scientific establishment ah, what's driving the vehicle, its corporate, me. ah . so what we try to do is really to leverage on the knowledge of this partners from developed countries and they offer free of charge the services them support little was. so we asked, this is sort of a broker 12 teams from developing an emerging countries to get access to speed.

because clearly one of the issues, one of the show stoppers is the cost on the launch in the operation the the, me hi, welcome back to the guys report i mass guys are time now to go to tabi costa. he's a portfolio manager at truscott capital tabby. welcome omx. thanks for having me again. all right, yeah, let's fall you on twitter quite closely and you've got some great insight into these markets. the 10 year treasury yale is plunged under 1.2 percent on monday. you know, what do you make of this move despite the trillions already printed in the past year? what does it tell us? i think we're reaching what i thought we would, which is sort of a stag lation scenario. i think the tenure yields is reflecting some of that,

but also there's a lot of folks looking at the tenure yields and thinking that that represents a lot. what's happening with the lation picture? i think that's really off considering the fact better reserves still buying a $120000000000.00 of tv. now the words, $80000000000.00 of tractors for plus $40000000000.00 mortgage backed securities. i also think it's interesting to see how the copper to gold ratio which follows it senior yield very close it throughout history now diverging, showing perhaps the senior yields should be higher, not lower than where it is today. so i think there's a lot of things going on, but the suppression of interest rates, which my view continues to be, the real mandate of the federal reserve, more than anything else is stability of inflation or maximum employment. i think that continues to be the case. we're seeing that in a huge way, but on top of that, we're seeing now some of that lation married times where it's inflationary. i would

say force are still kind of sticky and gaining momentum in my opinion, while at the same time we're seeing, you know, the economy showing off site that perhaps is we'll see some ration did anything else. so for folks are not up to speed on stagflation. no, we haven't seen it since the 970. what, what's the one minute definition that would be, you know, it's something that it's difficult to see. ra history in a very long period of time. but it's something that happens every now and then. and that is when economy is, is decelerating significantly at the same time, we're not growing at a very fast pace. at the same time, we're seeing evolutionary horses either growing or, or levels that are much higher than, than the levels of growth economic growth. we're talking normal growth at this point. so real growth actually becomes negative, which is kind of the keys right now. we look at the old federal reserve p c. now cass, it's running at much higher level than their old gdp now. population. so that is

one of the signs that receive the beginning of stack pollution. obviously, the economic activities been very hot recently, so that is not necessarily where we are currently, but i think we're leaning towards that direction where the economy with the salary continued the salary a little bit more. at the same time as depletion or forces to stay where they are or, or gain momentum here. so why does that all matter? now if you look back in 1907, we're all looking for an analog or what's happening today. and a lot of folks like to look at the seventy's, but i think we're in even more extreme situation that we saw back back then the government that the gt law was about 30 percent. they would about 128 percent of gdp just on the government side. and so back then when the inflation got up to 5 percent, we saw interest rates and the federal reserve calling its transit or number one.

but they did raise rates from 6 or 5 percent all the way up to 30 percent on this time around. i don't think they can do that now. what are they going to do? shock the world and raise rates to 2 percent. i highly doubt they're even able to do that. so i think we're going to see even more extreme policy. he's reinforcing the inflationary bar me. ah, and why? i believe that at some point we're going to reach this ration area barb. and i think that in your yields is pointing towards that direction. so president biden has said that the fed should take whatever action is necessary to help the economy recover. ok, then this is problematic for a couple of reasons. first of all, corporate earnings are at their highest and history. so what he talking about in terms of the, of that what, what does he think the fed can do? i mean, other than them print what, what's there seems to be a disconnect between jo biden's brain and what the fed can actually do. i agree,

and i think, i think there is an agenda here for inequality. there is an agenda for the green situation of spending on environmental issues in climate change. our problems that you know, especially the political environment, thinks that they should be doing. ah, but on top of it is this dependency on the, on the economy of not having organic growth and there's therefore needing a lot of monetary and fiscal stimulus which continues to deteriorate. the labor shortage issues and some other 3 pillars that i call inflation. that demand all we're seeing is this transfer of wealth from the government to the private sector and mostly the bottom, 50 percent receiving a large percentage of that of that capital. obviously the quality is to a big issue are when i said the stuff about stag lation on corporate profits being at the levels at the are right now. i was just referring to the level or i think

we're going to be in the near future. but i agree with you, the economy is really hot right now. and what is surprising is the difference between wages and salaries and corporate profits, which makes me believe that one of the big reasons why we haven't seen inflation is a steady decline of wages in ralph wages rough. for the last 30 years. i think we're going to see a change in that environment in the fall we years. and that's going to again become another pillar of inflation that it's going to be very. it's going to reinforce s trends on top of the basement of money here that we're seen in a huge way and monetization of that it might be, might be that is in process. and so i don't know necessarily what he means by recovery. if we're already, any person with a brain looking at the only the job numbers in inflation numbers, it's pretty clear we're had to return where he had the recovery. it's going to be difficult to see another 6 months, like we saw the prior 6 months. again,

unless we're going to see a major amount of fiscal and monetary sim was, which is possible. and so i'm very focused on the dilution of money. and what the consequences are that when you have this, this change of this transfer of wealth along with the labor shortage along with the bottle next to the supply issues, along with monetary debasement. and the increase of the globalization. i think all of those pillars are very inflationary, and i think they're very different than what we saw the last decade or so. and so at that, that for me is where the focus is from a capital allocation perspective. and of course, on the 7 days you had wages up, right? so inflation was kind of pulled by wage increase spiral. and of course you had an era of very strong labor labor unions. and actually, if you look back the wages in the 1974, vast majority of americans were relative to all other metrics very high.

since that time, since the 1980s in the deregulation of the markets with the reagan factor era, and financial engineering has been able to neuter wages the labor movement as such. and, and it seems curious what your take is here, joe biden, focusing on social justice, warrior stuff, a lot of arcade esoteric things i can't even get into. he's basically saying that we, we think here at the federal government that you, the american person and population we want you to be able to feel comfortable teaching things in your primary school. but we're not going to allow you to have a job that pays a decent wage. that's the trade off. right? and americans are buying it. they're same, actually,

we don't want jobs. we don't want to survive on income. we. we want to be able to explore all kinds of freaky stuff instead. that's the quid pro quo and they're getting away with it. shockingly, tabby, your thoughts while look, you know, it's incredible to me even when you use as an analog. what happened during the spanish flu? to this, this issue with especially broadcasts from the labor side, one out of 5 workers back in the 1919 was actually engage in a protest for labor at that time. and so i think that's another way of kind of a guiding us to this scenario. i think we're going to see that and we're seeing already some sort of pressure towards that divergence. again, from especially if you look at the ratio of wages and salaries minus the direct payment of the arguments. so you've got to remove that part of the picture and you in you and you divide that by the corporate profits clearly within, in

a steady decline. it almost looks like money, money, velocity chart, meaning it's been a secular decline on that. at what point do corporate profits translate into higher wages and sellers in that comes, in my opinion, from deflation air force is beginning to creep up, increasing the cost of living and the cost of living trees is what creates the need and the demand from workers to actually wanting to, to, to earn more money. and so i think we're at that level today, especially organically. in fact, i think we may be at that level to, with corporate craft for profits at record levels. i think i think there is, there is a chance we may see that that's going to change the whole dynamic, especially from a margie standpoint of companies. there's a lot of companies may be squeeze in a huge way as labor costs increases. and on top of it is what you're talking about is this is this issue with that we didn't seen in 1919,

which is this massive fiscal policy that turned into a labor shortage. where folks are just not willing to go back to the labor force. and so i think that that's, that's just exacerbating a natural issue of a secular decline, of wages and salaries that is about to change as we learn through all history, especially in the merging markets. and i think a lot of millennials and younger crowds of the us has not really experienced really lation, but it, you know, i come from the emerging markets and i know that when you have those types of programs where you give the money to the people, especially in the bottom, 50 percent, or from a helicopter money type of policies that received today. those tend to translate into reflection and that's exactly what we're seeing now. and then on top of it, you have this issue with not the bottom acts in the, in why chains and all that, that's somewhat transitory. but the thing is there has been a came year 15 here. horizon is, you know,

max of other investments in commodity. and so that issue is, is something that will continue to, to replicate into other situations where we don't have exploration of enough commodities to go from the new to the old, to the new economy. we don't have the development of minds to the same level that we saw on the s past decades. so although things are coming along together in a time when we haven't seen inflation in 30 years. and so i think that those policies are going to get even more extreme as we go here. and the dependency of the government continue to provide the income to the population here, especially the 50 percent. they actually continue miles in. so you're looking for are much higher break out of inflation. what's your target on that? and we got about 5 seconds. i think inflation is going to continue to run higher. i don't think it's going to be hybrid inflation, but will continue to be about, you know, hopefully i think it's going to get to

a double digit actually. all right, tabby casa, we're going to continue this part to thanks for bringing on cars report. thank you very much max. that's going to do it for this edition of cars report with me max kaiser and stacy herbert want to thank our guest to abby costa over there across get capital and lifetime by the me. ah, ah, the me the whatever.

ah the eastern half of the united states, we're going to have 1000000000 millions of human beings in their back yard. oh my god. obviously some of the cicadas do not have very high tolerance for alcohol because they are already passing out for long or 6 minutes or 400. i mean that's very

satisfying. in the headlines this saturday flashes between protests and the police in central parish thousands running against the government's plans to make colbert part is mandatory for entering public places. and i would cry in the british parliament as conservative. m. p. 's threatened to boy called that party conference if a vaccine passports are required to attend. the pentagon emits at least 7 people implicated in the murder of haiti's president had been trained in america as his private funeral. under heavy gulf was shaken by mass protest. ah.