Let's talk about something more interesting, like stagflation, fears, intensify in signs of slowing growth, ooh gas prices up. Oh my gosh 135 of some currency for regular unleaded all right. Let's see what we got supply chain disruptions. Sweeping major economies have reawakened an old nemesis for investors.

Stagflation anxiety over rising inflation has been ever present in markets this year, but with oil topping 80 a barrel global food prices a third more expensive than they were a year ago. In other commodities at decade highs investors say a longer than expected. Inflationary surge is coinciding with a slowdown in growth and making it worse hey. You know this is interesting.

I mean they're all right. The u.n uh just put out the report about food prices going up 33 year-over-year. That is a tax on poorer individuals or households that that aren't millionaires, certainly right uh. It's just crazy, uh.

Okay, so uh economists, investors play down comparisons with the aftermath of the 1970s oil shock. You know a lot of comparisons tonight. The 1970s even kathy wood has uh has compared to the 70s and said things like this ain't. The 70s, this time's different investors, say longer than expected.

Inflationary surge is considering with a slowdown coinciding with the slowdown in growth, then, in the 1970s, inflation and interest rates ran into the double digits unemployment sword and the gdp recovered only slowly from repeated setbacks, but with energy bills. Now rocketing, many worry about a growth slowdown at a time when central banks are edging towards lifting rates in a bid to keep a lid on longer-term inflation conversation around inflation has definitely shifted. Well, yeah, no kidding okay, so you got energy prices going up. You got food prices going up, you've got the economy slowing down, because the stimulant is starting to wear off, we'll see what kind of side effects we have of all that money.

Printing signals from the fed and bank of england last week were that they could have begun. They could soon begin lifting rates yeah. Let's see fueled a big bond sell-off, which increases yields, of course, but in contrast to the reflation trade at the start of the year, stocks have been unable to draw comfort from the prospect of tighter monetary policy. That's true recovery stocks started selling off and which were often deemed the deflation or reflation trades and tech has been selling off a bit everything's just selling off a little bit.

All right ample evidence suggests that a supply shock or reverberating around the world, combined with other outbreaks of delta, is tempering growth. I'm not so good, i mean. Is it? How concerned? Is everybody about a delta? I i mean, i think widening i mean there was actually a headline. I don't know if i have it here, but there is a headline in the walsh or financial times about how basically europe yeah yeah yeah.

Here it's right here: okay, eurozoo zone, consumer activity returns to pre-pandemic levels, and i thought this was a really interesting piece. I wasn't really gon na talk about it because i just read this stuff all the time, and i don't talk about everything that's in this stuff, but um. It's literally the front page page news right here. This is today's paper.

It says europeans are shopping, eating out and traveling and visiting cinemas as much as they did before the pandemic in a sign of returning returning consumer confidence across the eurozone. Data on economic activity in september suggests that consumers feel emboldened by high vaccination rates. Despite worrying economic news, including higher energy bills, supply chain disruptions and fears of a slowdown in china, for now, data remained consistent with a decent pace of recovery. Some of the rebound is because schools are reopening and but an increase in leisure activities also suggest consumers are now more confident.

Cinema revenues have already returned to pre-pandemic levels. I am shocked by that because when i go to movie theater there aren't that many people there. Let's see here, oecd weekly, tracker of economic activity, which uses real-time high-frequency data indicators rose above 2019 levels at the beginning of september. I mean that's good.

That's bullish in eurozone uh. Positive momentum might give the ecb confidence. It could scale back emergency stimulus, yeah we've already talked about that back from the brink, but not out of the woods because of supply bottlenecks. So i think the consumers are there.

Yeah. Okay, consumers are interested uh yeah. So, okay, let's go back to the ft over here. Um okay data released pointed to sharp slowdown in chinese manufacturing regulatory pressures.

A lot of the negativity has like a reason. You know, and that's a good thing. It makes me feel more comfortable. It's like okay, people are complaining about congress or complaining about china's regulation and and evergrand, which is really a symptom of chinese.

The chinese communist party changing their regulatory stance towards debt uh. You know so so far. A lot of these things are very explainable and it makes it really hard to consider that. Oh, no stocks are somehow uh, you know destined for a big mega collapse or whatever i mean hey, like you never know, i mean nobody saw the pandemic coming, except when it started happening and people got rich off puts when it started happening, which makes sense.

I mean that's one of the first things people do when the market's crashing. I was just spending my money buying the dip, but anyway selling activity spilled over into equity markets. This week after data showed that u.s consumer confidence had dropped to a six-month low. The uk found itself at a sharp end of stagflationary concerns with a surge in energy prices.

Okay, so it's interesting how confidence! I personally wonder how much consumer confidence in the u.s is based on what the stock market is doing, because, even though we've seen some economic slowing uh, there are a lot of indicators, especially europe, which seems to be a little bit ahead of us in terms of Covet that that people are spending again uh, so it's it's always weird to try to tie this all together because on one hand we've got more cash than we've ever had before. On the other hand, i believe we're going to be in a little bit more of a frugal decade, because i don't think people are going to spend themselves into oblivion like they used to the european union. While we're having some setbacks with energy prices is actually doing very well in regards to consumer activity, but then you have consumer confidence measures in the u.s a little low, maybe because of delta, and all this other congressional nonsense. But i expect that to u-turn so we'll see uh with revised data show activity, while advised data, while revised data show activity bounce back faster than thought over the summer.

The recovery appears to be faulting, at least the bank of england. So you get these mixed signals. Both of these are from the financial times today, on one hand, they're saying europe's doing better. Now, here they're saying the bank, the recovery appears to be faltering according to the bank of england, but it's because of supply bottlenecks.

So these are two different things right. So it's like okay, yeah supply bottlenecks are getting worse, but people want to spend money. This is more important in my opinion than supply bottlenecks. Now, supply bottlenecks are going to have a more immediate term impact on stock prices like supply bottlenecks are going to suck they're going to hurt stock prices, they're going to hurt gdp growth, but consumers apparently have the willingness to spend, and this is good.

Recovery takes hold, leisure, rebounds suggests confidence, but of course you have threats. Energy prices, supply chain shortages, price increases, so it's like people want to go back to normal, but yeah there are some headwinds. This makes sense makes a lot of sense. I mean people want to buy a tesla and they don't want to have to wait until march for one, but they will because they want a tesla consumers.

Overgrowth are one reason: the pound is not benefited from the sharp rise. If it's stagflation, central banks are in a blind, bind, hiking interest rates will reduce demand which will slow growth, but if you're already slowing growth through stagflation, then that's bad. That's if you believe in the deflation era, stagflation narrative, that's probably the biggest argument for a market crash right now is stagflation is that's it the economy's going to slow down its growth and, at the same time, we're going to raise rates and we're going to be Screwed but the only the only reason, in my opinion, the economy is growing slower is because there's this giant anchor behind us and it's an anchor of of many different things. The rent crisis, the uh high amount of unemployment uh as people transition to different jobs, supply chain shortages, shorter term inflation right all of those things are like this giant anchor and consumers are like.

We must move on and keep going uh. You know it'd be nice to cut that anchor, so uh inflation should start to ease in 2022 and the situation was still a long way off anything like the 1970s. We won't see inflation get into the system like we did then says: vicki redwar would would a senior economist or economic advisor at capital economics. Others warn, however, that there is no signs yet of strains on supply chains easing and that the world could be heading for a more sustained period of tepid growth and high inflation.

So that's that's really it it's. Basically, what we're saying here uh if supply chain problems, continue for a further six to 12 months, while consumers still had job security and were willing to pay for goods they wanted. He said the whiff of stag stagflation might be more of a stench wow. That was a complicated way to word that okay got it.

So basically, look consumers are happy, they want to get back to normal. They want to go back to traveling. They want to go to restaurants, they want to spend money. They've got more money than ever, but again, we've got this giant anchor that we're dragging around called inflation, because some prices are going up supply chain shortages.

Making us wait longer. We either have to pay with our time or we have to pay more money. Remember you pay more money for things like shipping costs to get the stuff on time or you pay with your personal time, because flights are getting delayed or hotels are booked up or whatever right. But overall you know, i don't know, i'm not a big proponent of this whole stagflation thesis, but then again i've been very consistent on this channel that i believe inflation is going to inflect down whether that's next month as a start or or in four months.

From now, as a start, we are going to inflect down downwards on inflation, but uh sure supply chain issues are a crisis and, at some point, they'll be up and running again. I just want to ask you this, and this is a great way to to leave off. How do you think with how much more productive our markets have gotten our economies and our businesses have gotten the cheap credit our businesses and our markets have gotten? How do you think our economy would be doing right now if we had zero supply chain shortages and literally, ask yourself that how would the economy be doing right now, with the amount of money people have uh the appetite people have to spend and no supply chain Shortages, would we be at all time highs on the stock market? Would gdp be at the highest place ever and so now picture that moment where businesses are more productive? People have more money and people have more willingness to spend just not now picture it at like the end of 2022 or 2023.. That's what i'm investing for! I'm looking at 2021 as like i'm planting seeds, man, i'm planting c, i'm going around going yup buy that buy that buy.

That buy that. So i think it's hilarious. When people like after a week of me saying i'm gon na buy a you know, i'm gon na do a fundamental play. It's like how come it hasn't gone up.

30 percent, yet it's like! Well, you know there are different ways to invest. It's not all camber! Electric, which i had tried to short, sell this morning or buy a put on, but i couldn't i'm sorry i might do a video on them like a standalone video but anyway think about it. All right folks appreciate you being here. We will see you in the next one just make sure to go to mckevin.com public, to get yourself a free stock worth all the way up to seventy dollars.

Kevin.Com public and we'll see the next one. Thanks again goodbye you.