THE NATION'S OCCASION... INFLATION, SHRINKFLATION, STAGFLATION

Elon Musk has been getting fiesty after Bill Gate's short in Tesla was proven to be a good call. Since, Musk has been seen preaching that the United States of America's future is looking more and more likely to have a recession occur. Jamie Dimon was recently stated that a hurricane was about the market/economy and everyone should prepare. In order to prepare for this recession, he said he will be cutting 10% of his employees. Tesla's stock dropped 8% after the news. This might not just be because of his expectations of the future of the economy (which he said was the reasoning in a recent email sent to employees), but another factor is that he was upset with employees who were not trying to work in the office anymore. He was so serious about the situation that he said if you don't plan of coming back to the office just quit. President Joe Biden was asked about this situation and he said that while tesla was cutting employees, their competitors such as ford were actually ramping up. Best case in my opinion, the economy is going into stagflation, but I would not be surprised if a recession occurs for a little. Inflation is out of control, the federal reserve has still yet to fix their balance sheets and raise interest rates enough, Russia is messing shit up like usual, China, one of the worlds biggest economies is still struggling from COVID because of their fluke vacines, earnings have not been great from many companies, but the one thing hold on my a thread keeping us out of a recession is the unemployment rate. If we can turn things around, I don't see a quick ramp back to November highs, and if that does occur that's just not healthy and I would expect another correction, but with many stocks cut by more than half, the S & P 500 hitting bear market territory (NASDAQ has been getting comfortable there for weeks on weeks on weeks now), a bottom may be near! With Buffet spending over $50 Billion I would say we are starting to see good signs but don't get your hopes up just yet.

Just like during COVID, companies have been adapting in order to survive. Now, they just are adapting in a different way. With the recent rise of inflation and supply chain issues, companies are either taking big hits (like Walmart/Target), rasing prices (Dollar Tree/basically every company but not Dollar General), or skimping you! Shrinkflation in my opinion is the way to go for most of these businesses (it's usually the food companies, chips, ice cream, candy...). Everyone notices when their favorite items price is raised but most people wont realize the amount they are getting if it is shrunken by a small porportion. So next time you are buying your bag of chips and think there's a lot more air and less chips, you are probably right.