Kerry Lutz's--Financial Survival Network (general)

1. Consumer spending roller coaster continues

• Disposable income went up slightly to 0.4% in May 2023, after 4 months of declines 
• Personal consumption expenditures continues to roller coaster, at basically flat at 0.1% in May vs. +0.6% in April and +0.1% in March 

2. Out with the old...legacy categories and consumer loyalty are declining, as consumers become more price sensitive

• "Serial churners" on Netflix (consumers who binge and quit streaming services) grew from 3% of subs in 2019 to +16% of subs in 2022, per a HBR article I co-wrote here. https://hbr.org/2023/07/tackling-the-problem-of-subscribers-who-bingethen-bail
• Thrill data shows the average wait times at Disney world was 33 minutes in July 2023 vs. 41 minutes a year ago. This is the lowest since January 2022. 

3. In with the new...consumers are willing to spend, but on 'new and different' experiences

• COVID to Community: The WSJ notes the "Taylornomics" phenomenon, where Taylor Swift's $1B US tour is creating spending increases everywhere she goes. In Cincinnati, total adjacent spending grew $48MM per their tourism office
• Per the BLS, the monthly average # of US workers taking vacation from Jan to June exceeded 2.5MM, which was the first time since 2017
• Cybertruck pre-orders are at 1.9MM as consumers await this controversial, but compelling different product

4. While interest rates remain high, consumers...especially younger ones...will hold off on bigger ticket purchases in lieu of smaller, immediate and different experiences

• Per Moody Analytics, only 11% of homeowners have an adjustable rate mortgage...
• ...so the vast majority of homeowners have not been impacted by interest rates and have little incentive to move until rates drop
• Per Redfin, the median price of a starter home is 46% higher than in 2019. First time buyers of home will delay buying a home (and possibly having kids), and continue to spend on these smaller, immediate and different experiences

Twitter feed: @eddiewouldgrow

Email: eddie@eddiewouldgrow.com

Eddie's site: https://EddieWouldGrow.com

Our site: https://FinancialSurvivalNetwork.com

Kerry Lutz and Ed Siddell discussed the current state of the economy and the possibility of a recession. They analyzed the strength of the economy and potential risks such as the commercial real estate meltdown and the banking crisis. They also discussed the impact of debt and credit on the market and the changing credit market. The conversation highlighted the uncertainty and complexity of the current economic landscape and the challenges facing investors and businesses.

Kerry Lutz and Taylor Loht discussed the benefits of investing in real estate over stocks and bonds. They highlighted the importance of cash flow and an abundance mindset for success in real estate, as well as the challenges of dealing with misbehavior in the industry. They also emphasized the importance of networking and building relationships to find deals in the commercial real estate space. Taylor shared his successful investment strategy of investing in scarce assets with high demand, such as self-storage properties, and discussed the potential of investing in mobile home parks.

Jim Welsh provided a detailed analysis of the current state of inflation, predicting that it will continue to rise due to the reversal of energy prices and food prices. He also discussed the impact of higher interest rates on unemployment numbers and predicted that a recession is likely in the near future based on historical indicators such as the yield curve inversion and the increase in lending standards. Kerry Lutz and Jim Welsh discussed the shift in market sentiment from anticipating a recession to believing that it is no longer a concern, and how this may actually increase the likelihood of a recession.

Lobo Tiggre joined Kerry Lutz to discuss the state of the economy and inflation, with Lobo providing a nuanced analysis of the factors contributing to the weakness of the US and global economies. They also discussed the strength of the demand for gold despite headwinds like higher rates and Fed tightening. Lobo provided a market analysis of gold and silver, predicting a potential near-term pullback in the gold market and advising caution. They also discussed the potential impact of a liquidity event on the metals market and the unpredictability of market crashes.

We sat down with Prospera Energy’s (🇺🇸GXRFF -- 🇨🇦PEI) CEO Samuel David and VP of Subsurface -- George Magarian for an update. Prospera is one of our largest holdings. Of primary importance is the company’s 18 well drill program, consisting of 8 slanted/vertical wells and 10 horizontal wells. All the pieces are in place to commence its Phase 2 drill program, which will start by August 15 and will commence rapidly.

VP Magarian has put in over 36 years as a petroleum geologist and is an expert in Western Canada geology. He’s worked for many major producers. He has high expectations for the program. The new wells are in existing fields so risk is extremely low. He expects and 80 to 90 percent success rate. In his opinion, these wells will produce at least 60-100 barrels per day. He expects the resulting increased production in Q3. This added to August’s 1250 BOE will substantially increase production and cash flow.

For 2022 the company reported record cash flow of C$5.4 and upon completion of its Phase 2 program 2023 could go much higher. It has upped its working capital and cash position so it can easily finance increased production. The company has also been helped by $75 oil.

Finally, CEO David discussed the company’s anticipated acquisition. It is in active talks to take over an existing field and is negotiating the exact scope of acquired assets and liabilities.

Prospera expects to news flow to increase substantially as its drill program ramps up and results start coming in. We are very optimistic about its future.

Company website: https://ProsperaEnergy.com

John Grace discusses the economic history of Japan and advises investors to be prepared for the good, the bad, and the unforeseen, and to consider diversifying their assets. He also discusses the potential impact of demographic changes on the real estate market and provides advice for investors, including selling excess real estate and looking at investment opportunities in warehouses, medical properties, and infrastructure. Kerry Lutz and John Grace also discuss the benefits and drawbacks of immigration for the US economy, with Grace arguing that immigration is a net gain and Lutz emphasizing the need for controlled and regulated immigration. Finally, they explore investment strategies and opportunities in the face of technological advancements and economic uncertainty, with Grace emphasizing the importance of active management and diversification in investment portfolios.

Visit John at: https://www.westlakefinancialadvisors.com/

Visit us at https://FinancialSurvivalNetwork.com

Kerry Lutz and Carl Gould discussed various topics. They talked about the differences between Threads and Twitter, with Threads being more of a private communication tool, while Twitter is more like a public radio channel. They also discussed Elon Musk's X, which could potentially leapfrog all other players in the market. Additionally, they talked about the trends in the business environment post-COVID, including the reindustrialization of the United States and the move towards design and distribution.

Kerry Lutz and Kris Miller discussed the benefits of investing in index universal life insurance to create tax-free income for life. Miller explained that this strategy is a safe way to ensure that you never outlive your income and that it provides peace of mind. She also emphasized the importance of getting your cash safe and setting up streams of income, and explained that there are creative ways to fund these investments over five to ten years.

During this Financial Survival Network segment, Kerry Lutz interviewed David Wright about the recent CPI report and its implications for the economy. Wright expressed caution and bearishness, citing the sticky inflation rate and the upcoming challenges for small businesses. They also discussed the impact of AI on the economy and the potential for job displacement, with both expressing concerns about the long-term implications of AI.

Chris Vermeulen and Kerry Lutz discussed the recent surge in precious metals and miners, with Technical Trader Ltd. attributing it to a potential bottom and bounce in the market. They also discussed the possibility of a gold-backed currency and its potential impact on investors, with Technical Trader Ltd. suggesting that it could make gold a more serious asset. However, Kerry Lutz expressed reservations about a gold-backed currency and its potential impact on international trade.

We sat down with a new show sponsor, Correlate Energy’s CEO Todd Michaels (OTC: CIPI). He explains that fortunes are made and lost when major energy transitions take place. Today we are in the first inning of a major transition away from centralized electricity generation to decentralized production. As CEO Michaels stated, “Just like the smartphone changed the way we all work and communicate, decentralized energy will have a similar profound effect.”

As the electrification transition rapidly moves forward, traditional carbon-based energy sources alone cannot provide the extra needed giga-watts. However, multi-trillion-dollar government incentives are locked in place and there’s no going back. Solar, wind and increasingly microgrids will lead the way. Correlate is uniquely situated to capitalize upon the resulting opportunities. In it’s case, their seasoned team has decades of experience in the renewable energy marketplace. They provide customers with a one-stop solution including: financing, planning, permitting, construction and operational management.

The company just announced an initial $100 million joint venture with eDGe Renewable Partners which will dramatically increase micro-grid development and construction, nationwide. The strategy appears to be working as the company became cashflow positive in May and expects revenues of $25-35mm in 2023 and $45-60mm in 2024 while achieving 18-25% margins. CEO Michaels states, “You can see the [revenue growth] directionality as our projects are now coming to fulfillment.”

He makes a compelling case as few businesses can resist the ability to lock in and reduce their electric bills for the next 20-30 years. Decentralized Energy has arrived and promises to be the hottest and most profitable energy sector for the next several decades.

Correlate offers a low-cost, low-risk way to profit from this inexorable trend.

Company website: https://Correlate.Energy

Financial expert David Stryzewski discussed the current state of the economy and investment strategies with Kerry Lutz. Stryzewski predicted a slowing economy and advised caution when investing in bonds, instead suggesting growth-oriented fixed index annuities as a protected asset. He also emphasized the importance of tax planning for retirees and pre-retirees, and suggested taking advantage of the tax cuts and jobs act. Stryzewski's approach to financial planning focuses on helping families create tax-optimal income plans for the rest of their lives.

Visit David at: https://myspg.com

Visit us at: https://FinancialSurvivalNetwork.com

Mark Twain once said, It ain't what you don't know that gets you into trouble. It's what you know for sure that
just ain't so." 

This is especially true when it comes to your closely held beliefs. We all have long held false beliefs that have done nothing but sabotage your life. Things like "I'm not good enough, I'm not smart, I can't succeed, People disappoint me, etc." Shelly Lefkoe has worked with thousands of people, helping them to expose of and dispose of their false beliefs and she would love to help you do the same. 

She gives concrete examples and real life cases where her system has changed lives. I recounted my 3rd grade teacher who made me feel inferior and dump. These beliefs stuck with me for many years. It wasn't until I realized that I was a fast learner capable of success that I overcame my personal history. 

Anyone can dispose of their false beliefs using her system.

Go to https://eliminatebeliefs.com and start working with Shelly today.

Visit us at: https://FinancialSurvivalNetwork.com

Kerry Lutz and Paul Otter discussed the Supreme Court's decision to strike down the current administration's plan to forgive student loan debt. They highlighted the potential impact on borrowers and the economy, including missed payments, higher credit card debt, and a decrease in credit scores. The need for Congress to revisit the student loan scheme and hold universities accountable for their role in creating the problem was also discussed.

Blow-out jobs report means interest rates have to rise. 10-year Treasury broke 4% this morning. 

In the past two bubbles interest rates rose along with stocks until the markets broke. We're repeating that pattern. 

The Big Toy indicator is flashing: RV and Rolex sales down. 

Commodities getting whacked. Are we in a bear market? 

France is burning. A sign of the future? 

Quality of life in our major cities is rapidly declining

The Supreme Court is issuing some big rulings. What does that mean? 

-- Affirmative action

-- Web design/bakery "compelled speech"

-- Student debt (separation of powers) goes back to baby boomers, when college was cheap https://www.supremecourt.gov/opinions/22pdf/22-506_nmip.pdf

-- Louisiana court banned gov't social media censorship https://www.politico.com/f/?id=00000189-2209-d8dd-a1ed-7a2de8d80000

(Trump was a hugely consequential president!)

Visit John at: https://rubino.substack.com

Visit FSN at: https://FinancialSurvivalNetwork.com

Alex Sonkin explained the Due Diligence Project, which is a peer review community of mostly CPA firms that helps mitigate the risk and time to complete due diligence on sophisticated tax structures. The Due Diligence Project serves CPA firms who are trying to differentiate themselves and serve clients with tax problems. They have created the largest independent peer review community of CPA firms in the country and conduct summits to bring the community together.

Jamar James shared his insights into cryptocurrency and the potential for digital currency to be a vehicle for wealth.

Kerry Lutz and Dave Shutler discussed the state of student loans and the importance of avoiding them. They recommended picking a major first and then a school to avoid taking on too much debt. They also emphasized the importance of knowing the potential earnings for a chosen career path before taking on student loans.

Kerry Lutz and Anthony Saccaro discussed various topics related to the economy, including consumer confidence, the housing market, inflation, and investment strategies. They examined the factors that contribute to consumer optimism, such as the strength of the labor market and the availability of jobs, and discussed the potential impact of global events on the economy. They also noted the unusual reaction of home sales and prices to rising interest rates and the fear of the Fed that another home sale explosion could cause them to raise rates more aggressively.

The U.S. economy showed much stronger-than-expected growth in the first quarter than previously thought.

GDP increased at a 2% annualized pace for the January-through-March period, up from the previous estimate of 1.3%.

The upward revision helps undercut widespread expectations that the U.S. is heading toward a recession but I am not so sure that is realistic if the Fed’s continue pushing rates higher.

We all know inflation has finally hit 4% according to the CPI but consumer spending, as gauged by personal consumption expenditures, rose 4.2%, the highest quarterly pace since the second quarter of 2021 and Core PCE prices rose 4.9% which will only fuel the Fed’s resolve to continue pushing rates higher to continue contracting the economy.

Interestingly we see that exports rose 7.8% after falling 3.7% in the fourth quarter of 2022 so demand seems to be healthy.

Though I think many investors are wanting to be bullish, now is not the time to embrace the market with both hands. 

Remember that as we begin entering earnings season many of these companies get to set their own bar, therefore it has been easier for them to look good when in reality there is underlying weakness in their earnings.

Be patient, focus on dividends (collect them or spend them) but be ready to buy as there’s likely to be more K-Mart Blue Light Specials coming.

Visit Matthew at https://JohnsonWim.com

Visit FSN at https://FinancialSurvivalNetwork.com

Jim Sheils and Kerry Lutz discussed the current state of the real estate and investment industry, focusing on the Florida market. They talked about the challenges of building affordable housing and the potential for growth in different areas of the state. Sheils provided an overview of her company's in-house financing program and the types of residential properties they focus on.

Markets have been headed sideways for a while now. During Avi's last session on the show, he was of the belief that no market crash was coming in the near future. He was expecting the bounce that we eventually encountered. 

Now he believes that the market is at a turning point, either up or a significant move down. The future is always uncertain, but Avi uses his technical skills to try to get an edge. A few more market moves and he'll have a better idea. 

Let's see how it works out. 

Visit Avi at: https://ElliottWaveTrader.net

Visit FSN at: https://FinancialSurvivalNetwork.com

In a meeting between Rick Rule and Kerry Lutz, they discussed the resource sector and the upcoming  Rick Rule Symposium -- Natural Resource Investing. Rick noted that the market is bifurcating into two junior markets, with one market being populated mostly by the lame and the blind. He also predicted that the conventional energy sector will do well absent a real recession, and that the largest demand for coal was in 2022. They also discussed the global energy crisis and the need for more electricity, particularly in developing countries, and the importance of battery metals, such as lithium, in the transition to cleaner energy.

Kerry and guest Charles Lubar discussed Lubar's journey from working for the IRS to representing celebrities and moving to Kenya to start a business. Lubar shared his fascination with music and his involvement with the 4th and 5th generations of Yo Hung Nepo M kmo. He also talked about his decision to leave the IRS and move to Kenya with his wife and daughter, the challenges they faced in building houses and getting into small-scale manufacturing, and the partner's sudden death that led to the government distributing the assets to miscellaneous African creditors. Despite the difficulties, Lubar believes that taking risks and experiencing new things made his journey exciting and worthwhile.