The Schaftlein Report | ECON 101- If you want more of something (OIL), tax it less
1) Do not raise taxes to if you want more supply. Increasing supply will help reduce prices. Democrats are moving in the opposite direction.
1A) Inflation Reduction Act – Sen. Sinema holds the cards.
Dave details the problems with the bill.
1B) This follows the CHIPS Act which passed the senate with the goal of bringing chip manufacturing back to the U.S.
2) Oil drops as weak Chinese factory data heightens demand concerns and property slumps.
Gasoline prices drop for the last 45 days
2A) 2 Year Notes are prices 30 basis points higher than 10 year notes 3.00% – 2.7%. Is this an indicator of a future recession? Or a current recession?
3) Home prices cooled at a record pace in June as demand falls and supply builds. This is the biggest drop since the 2007-2009 period.
It would take 6 more months of drops to bring the market back to normal conditions
Rising interest rates currently around 5% and Inflation are leading the slide
The Median price is now $416K
4) Americans wages are not keeping up with Inflation costing the average family an extra $460 per month.
76% of Americans are concerned about Inflation and 60% are worried about making rent and mortgage payments.
35% of Americans rent instead of own and the average rent is now $2,000 per month.
72% have not saved enough for retirement
5) How did Government student debt projections go from a profit of $114B to a projected loss of $197B?
Easy answer – If the policy is to defer payments way too long and not accrue interest, you have a blow up.
If Biden forgives $10K per student, it will cost the government $321B.
The total student debt now stands at a whopping $1.7T an average of $30K per borrower.
6) Job openings fell to 10.7M in July from 11.1M in June
7) Federal Reserve to raise Balance Sheet run off to $95B in September. The Balance sheet is currently at $9T.
