Inflation is here, caused by all the free money.

So we are finally getting wage inflation.  Near were i live, fast food jobs are now paying $18/hr, with bonuses around $1000 for accepting a job.  This will finally get the federal reserve to taper and raise interest rates, because although they want price inflation, they don't want you to be EARNING more money.

No one wants to work because unemployment pays $26/hr.  So even at the high rate, it still almost doesn't make sense to work.  Anyone who says the unemployment benefits is not causing a labor shortage is not looking.   Almost everyone is paying bonuses to work.   And still no one can find workers.

And the stock market is still at all time highs.  But in September all that goes away and no one will have an extra $300 a week to buy call options, so we might actually crash in October.  I will keep my money in cash and wait to buy in November.  

But a crash will be a good thing. We won't be able to buy as much crap from china/SE Asia and maybe people will have to start working again and producing things.   We can't keep going deeper and deeper in debt and expect the dollar to keep its value.  

The Beginning of the END?

Bitcoin is down 40%, but it wasn't long ago it was around 10,000 so you could still be up big in a short time.   I hear daily about new cryptos being created and touted as the new thing.  It will fracture the interest in the big cryptos and cause them all to collapse.  The interesting thing is when it collapses 99%, what will happen then.  The myriad of dot.com stocks are all out of business is huge, but out of the collapse came facebook, amazon, the "big boys".  If cryptos are the future, the time will be coming where maybe you might want to throw $1000 dollars into the ones that seem to be surviving/still functioning.  The trash and useless ones will go away, and we will be left with just a few and they might be worth thrown $1000 dollars or so (maybe 1 to 2 percent of your money), just on the off chance that it is really what they are touting (future of money).  I won't invest anymore than that, because I am still not entirely sure that the entire market will not be replaced by something more "official".  

Since the end of all the "free" money is coming to a slow, grinding halt, I am expecting things to start to go down, like stocks, bitcoin, the high-flying stocks like GME, Telsa, ARKK.   Companies that are worth fractions of what they are selling for right now.   I don't know if the cryptos are enough to pull everything down with it or if it will be isolated, but as with the housing bubble, it has the potential to crash.   

What I figure is most likely to occur, is that we have multiple crashes that feed on each other and spread, the cyrptos, housing prices, and the "new tech" all go down together.   I guess the only question is if we see a bounce where Bitcoin gets to back to 50,000 and then it all goes down in flames, or is just goes straight down.  

Dear Cryptocurrency millionaires

 Maybe cryptocurrency will replace current fiat money, but not right now.  The problem i have is that right now cash is cheap to exchange.  It is basically free in a lot of cases to give someone 100 dollars or less.  And it can almost always being instantaneous.   Paying for pizza is easy with dollars.  The bitcoin transaction is neither.  The average bitcoin transaction costs $23 dollars, and/or it takes a couple of days.  How does this work in everyday life?  Also, everyone says it is "easy" to use bitcoin, but you have to have a wallet, remember your keys and password, and you hear stories about people losing one or both of them.  So it isn't as safe or easy as cash.

One of the "pluses" for bitcoin is that it is limited in the amount of bitcoin available.  But I keep reading about different cyptos being launched weekly, sometimes daily.   This is like the dot com bubble where everyone just came up with an idea, somehow made it show up on the internet, and slapped ".com" to their name and made lots of money.  Is bitcoin the amazon or facebook of cyptos, or is it the pets.com or myspace of cryptos.  No one knows.  All that has to happen is for some crypto to come along that "solves" the problems of bitcoin and the rest of the cryptos, and all the current ones become worthless.   Really, this could be "fedCoin" or "USAcoin" or ChinaCoin" or why not "AmazonCoin".  

Everyday you hear about people making millions in cryptos.  I heard the same thing in 1999 and early 2000.   Then all of a sudden, it was about people who "HAD" millions, and no longer had anything.  And the had already spent some of that money, but now it was gone.  If you have big gains, I suggest taking some profits, at least 25% or more, and diversifying.   Buy gold, keep cash, buy stable company stocks.  Pay off your mortgage maybe.  Just don't keep 100% or 99.9% of your wealth in a speculative bubbly asset(?). 

The end is nigh, 2 big costs going up

 I think this craziness is about to end.   In 6 months to a year you can pick up bargains.   There will be good deals to be had, 90-99% off sales.   The best may be down 75-80%, maybe those are the ones to buy.  I will have to think hard about that.   Make a list of strong companies with a bright future.  

Why is it about to end?  There are 2 big costs to the economy that are going up in price.  Interest rates are going up.   And I hear that what's the big deal?  2 percent on the 10 year is still low historically.  But if you borrowed money at 1 percent then you interest doubles, and most of these companies are not making money so they are increasing their debts and there costs will start to go exponential.  Losses that were hidden or pushed out will be dumped into the earnings reports at once.  1 time write-offs will explode. This is what happens at the end. 

The other big cost is oil.   Heck, the price was NEGATIVE for barrels of oil a year ago or so (insane).  Now it is 60.  Again, not horrible but if you can't make money with oil at $20 a barrel, how do you make money when it is 3x that.  

I just don't think the 3-4 trillion infrastructure bill will be in time to rescue us.  Government just can't spend that money fast enough most likely.

Stock Market Insanity

 Craziness.  The stock market is going nuts.  It just keeps getting crazier.  I see the economy (the real economy, GDP - government spending) is tanking, not improving and the stock market just keeps making new highs.   Tesla is now worth more than GM, Ford, Volkswagon etal.  Really?  I don't think in the future Tesla will be more than a niche player.  Once the big boys get serious about electric, Tesla will be toast.

This definitely reminds me of the dot com bubble.   But housing is getting bubbly as well.  And bonds are yielding nothing, meaning they are overpriced as well.   But the end seems to be nearing.  Yields are creeping up and once that happens all this debt will be unpayable and the defaults will start and all the fun and games will end.  

Then the fed will either print our dollar and turn it into something to start fires with or they will be too timid and everything will fail.  

US government is spending money and this is propping up the GDP, but if you could become wealthy by printing money and just borrowing more and spending it, Zimbabwe would be the wealthiest country in the world.   I just read in 2045, it is expected that the interest on the US debt alone will be the single largest expenditure in the US budget.   This is what we will be spending most of our tax dollars on in the future and it will not be fun at all.  Less for military, social security, Medicare, infrastructure, schools, anything you really might want the government to spend money on.

I watch this guy "meet Kevin" on youtube.  He is worth millions but he is buying stocks on margin and buying worthless companies like Tesla, Nio (even nichier EV car company).  When these stock go down they will go down hard.  Could be something like 90% or more for some of these stocks.  

Bitcoin madness is even crazier.  I get that dollars really are worthless, but what is bitcoin?  I think it is time to buy real things and wait this out.  A bitcoin is worth $50,000 dollars because the last person willing to buy it paid that much.  But if you went to another planet where they used TibCoin and/or Zollars as a medium, how could you convince them it was worth anything.  Yes, the same can be said of the green stuff in your wallet or bank account.   Stocks are overvalued, but at least they have value.  They make and produce stuff people want and pay you (dividend) or re-invest in the company and grow to make more money.  

So as the government hands out all this printed money while we produce nothing, dollars will be worth less and yields will rise and the fed will be shown to be frauds once and for all.   I don't know how long it will take but we are closer to the end then most people think.

I wouldn't touch stocks, but if you are invested, my advice is to not use margin.   Invest in companies that make money.  They will go down as well, but maybe only 50% instead of 90% to 99%.  Don't borrow money to buy fancy stuff like cars and boats.   If you can't pay cash, don't buy it.  

Well, good luck all!