Is there anyone who believes in the low inflation numbers being touted by the government? On our recent trip to the Seattle area, we wanted to take in the sights. From Pike’s Market in downtown Seattle to Snoqualmie Falls, 30 minutes east of Seattle, the attractions were packed. My cousin was our tour guide for the Snoqualmie Falls trek. She made a reservation at Salish Lodge to have a late breakfast at Salish Lodge, known for their steel oats. How much could a bowl of oatmeal cost? I found out and the waiter didn’t even apologize. I thought to myself “Does this include a souvenir as well?”.
Real estate prices continue to soar as retail chains continue to downsize. The stores at Pike’s Market were crowded but not that many people appeared to be buyers, most were just lookers. Starbuck’s first store (circa 1971) was packed. Very few people were buying the high-priced fish at the market. Gasoline hovered at $3.90 per gallon. All is not good on the economic front. Shadowstats.com’s inflation rate of 9.7% is much more accurate than the headline inflation rate of 1.9% put out by the government. I’m not sure what planet they report from.
The retail sector continues its decline. They are heavily discounting, attempting to get some traffic. Dollar stores are merging which is not a good sign. More and more dollar menus are cropping up and restaurant chains are heavily marketing “dinner for two” deals. The following graph provides the real story of where the U.S. economy is at:
China’s industrial output has been showing weakness as well. Germany has shown signs of contraction. The cheap money has helped the top 1% but has left the middle class behind. The U.S. economic engine has just about sputtered out. When this happens, the central planners try to put us into another war. All the signs point to chaos ahead. Love is the only answer to the current woes and at some point people will wake up and smell the flowers. In the meantime, deleverage and simplify. Don’t let “stuff” rule your day.