Retail Sales Collapsing
70% of GDP is consumption, with that in mind, seeing such a bad number with a downward trend is very concerning for the future of the economy, revenues, profits, EPS.
Remember that core inflation is still very high at 3.9%. At this pace, we could end up in a stagflationary environment.
While many look at Nominal GDP. They are missing the importance of REAL GDP (inflation-adjusted)
Real GDP has only risen by $1.8 trillion since 2019 while total public debt has risen by $12 trillion during the same period. A horrific ROI! That means for every $1 of borrowing by the US Gov't we only get 15 cents of real economic growth. Wait! It gets worse.
I recently posted this chart, Real GDP to Public Debt since 1971. The trend is alarming. We are adding more and more debt while getting less and less Real economic growth.
At this rate, we will end up in negative territory. Meaning, that the more we print the less and less economic growth there will be. The more we feed the beast with debt the more debt the beast wants!
Gradually then suddenly!! Works great till it doesn't!
A lot of deep macroeconomics in this post I know. For now, let's focus on the near future. Retail sales are concerning at the very least.
Remember that core inflation is still very high at 3.9%. At this pace, we could end up in a stagflationary environment.
While many look at Nominal GDP. They are missing the importance of REAL GDP (inflation-adjusted)
Real GDP has only risen by $1.8 trillion since 2019 while total public debt has risen by $12 trillion during the same period. A horrific ROI! That means for every $1 of borrowing by the US Gov't we only get 15 cents of real economic growth. Wait! It gets worse.
I recently posted this chart, Real GDP to Public Debt since 1971. The trend is alarming. We are adding more and more debt while getting less and less Real economic growth.
At this rate, we will end up in negative territory. Meaning, that the more we print the less and less economic growth there will be. The more we feed the beast with debt the more debt the beast wants!
Gradually then suddenly!! Works great till it doesn't!
A lot of deep macroeconomics in this post I know. For now, let's focus on the near future. Retail sales are concerning at the very least.
Real Macro Economic Investing
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