Live from Music Row Friday morning on The Tennessee Star Report with Michael Patrick Leahy – broadcast on Nashville’s Talk Radio 98.3 and 1510 WLAC weekdays from 5:00 a.m. to 8:00 a.m. – host Leahy welcomed by Fox Business contributor and Wall Street expert Liz Peek on the newsmakers line to discuss Joe Biden’s fiscal stimulus, wage increase disposition, and the consequences of inflation.
Leahy: We welcome to our newsmaker line our good friend Liz Peek, Fox News contributor and expert in finance. Liz, you always deliver common sense.
We’re in a land and an era where common sense seems to be very short in supply. I got one word for you. I’d like to get your reaction to this. Inflation.
Look, this is a serious problem, and I think it has been dismissed a little bit too easily by the Federal Reserve chair and by President Joe Biden.
Jerome Powell is in an awkward position. He wants to be reappointed when his term expires, I’m sure. And he also is on record having called for enormous fiscal stimulus, a lot of government spending to get us out of the slump that we were in because of COVID.
And now that that’s being delivered, probably at a level much more than he expected, it’s very hard for him to turn around and say, no, no, I was only kidding. These are not good ideas.
These $1.9 trillion dollar bills, $2 trillion dollar bills, et cetera. Please hold off on that. Even as I continue to throw billions, trillions of dollars into the economy through monetary policy.
So he’s got a problem. But I think the country is waking up to the fact that these giant spending programs that have been promoted by Democrats are simply pushing too much money into an economy that is chasing too few goods and now showing up in inflation.
Biden actually talked about it the other day (Chuckles) and his explanation was completely muddled. Which I guess we’re not surprised about.
But he’s talking about how the investments he wants to make in, I don’t even know what, green energy, et cetera, and that’s going to help inflation.
No, he’s wrong. That’s not going to help inflation, not in our lifetime, probably. In fact, it’s going to spur it because everything they want to do, for example, in energy is driving up the cost of energy.
Yes, the government is going to be subsidizing it so the consumer may not see it right away. But the truth is if you start piling into our economy, higher-cost energy, it flows everywhere.
So we have a problem. We have a spending problem. We don’t have a tax problem. If you look at long-term trends, the country is simply spending too much money.
I don’t think really many people can argue with that. We’ve never had a budget that called for spending $4 or $5 trillion dollars.
These are unimaginable numbers that we haven’t seen since World War II. And here’s the thing, we’re not at war. We have an economy that went into a ditch.
It’s very quickly revived. Democrats are lying about the fragility of the economy because they want these programs embedded now, such as the child tax credits, such as long-term dependent care, et cetera.
This really is not a good thing for our country. And thankfully, I think the polling shows consumers are very anxious about inflation, and that may help stem some of the more radical spending plans.
Leahy: But Liz, not a joke. This is is just temporary inflation. (Imitates Joe Biden) I’m paraphrasing what the President said.
Peek: And yeah, they can point to some things like lumber prices. We know went up 400, 500, 600 percent year over year, and they have come off those highs.
But one of my favorite economists on Wall Street, Ed Hyman, and has described inflation as lumpy. And he’s right. It comes kind of in batches.
You don’t really know what is going to be the big problem area, but here is one big problem area right now is rent. We’ve seen housing prices go through the roof.
Both new house prices and existing home prices are up substantially even as the Federal Reserve keeps buying up $120 billion dollars every month of bonds, including mortgage bonds.
Explain to me why we are buying mortgage bonds when the housing market is red hot? What that does is make mortgage rates lower.
Okay, that’s great. But it also spurs demand and throws out of whack a normal rebalancing of the housing market. But here’s the other thing.
What I am concerned about, and I’ve been writing about four months now, is this whole wage-price spiral. I’m old enough, I’m embarrassed to say, to remember the trauma of the 1970 inflation surge.
And what happened is you have a raft of price increases. And then the next thing that happens is you have workers going to their bosses and saying boss, the price of everything is up 10 percent. I need a raise.
And the boss says, well, you’re right. You do need to raise, put a raise through. And then he has to raise prices because he can’t afford that raise.
Joe Biden keeps saying to the restaurant workers at the CNN Town Hall: If you just raise your prices, your wages a little bit, you’ll be able to attract workers.
Well, what we’ve seen is workers are sitting on the sidelines because the $1.9 trillion dollar American Rescue Plan and other programs are offering so much in benefits and unemployment that they don’t need to take a job.
So we have a shortage of workers I think, due largely to this extremely large test of the federal government, that shortage of workers is meaning everybody has to be out there raising wages.
And there you have it. Wages are going up. Great for workers in the short run, but not if they’re paying more for everything as a result of that, which is what’s happening.
Leahy: I have a theory about why the Biden administration is so off point on this. I think it’s comprised of a bunch of economic dunderheads who are caught in a John Kenneth Galbraith time warp and have gone back to 1960. What do you think of that theory?
Peek: Well, I think you’re right. Actually, I think you’re wrong. I don’t think they have any kind of philosophical framework (Leahy laughs) or theoretical framework for what they’re doing. This is just a power grab.
Leahy: I think you actually have the right answer.
Peek: Well, forgive me.
Leahy: No, that’s fine. This is why we love having you on. Because you know what you’re talking about.
Peek: Well, it’s just so offensive to me. There’s no accountability for these bills that are being passed. Presumably, no one knows exactly.
But it’s – we’re close to $2 trillion dollars that have been allocated by Congress now and not spent. And yet here are Democrats talking about pushing through a $3.5 trillion dollar plan through reconciliation.
No GOP votes. And everyone out there should be wondering what is in that plan? Why are they so desperate? Because, by the way, the polling on this is pretty terrible.
They know this is a risky thing. They know this could cost them the control of the House and Senate in 2022. So why would they risk everything on this bill?
And the answer is because it is a massive payout to the teachers’ unions, the SEIU, and the other groups that will then come back and put them back in office think, two years later.
It’s building their base of support. And this is not right-wing craziness. This is because they are creating programs that are distinctly beneficial to expanding the membership of those unions.
What do those unions do? Well, for example, if they get their way on the voting rights bill, they’ll go out and ballot harvest. What better group than the tens of millions of members of the teachers’ unions to go out ballot harvest from nursing homes and hospitals and long-term care facilities, etc, than all those teachers?
It is just the most nefarious cycle of payouts and then support building at the expense of the American taxpayer. It’s really extraordinary.
Leahy: It’s a pure power grab.
Peek: It is.
Leahy: I think you nailed it. That’s exactly what this is. It has nothing to do with any kind of underlying economic theory. They don’t care about that. They want power, and that’s what defines them.
Peek: Yeah! The latest excuse in terms of a theory is this so-called modern monetary theory, which argues that you can just spend forever and ever unceasing amounts as a federal government.
As long as your currency remains whole and sound, it’s just basically become a talking point on the left. At some point, your currency doesn’t remain strong and sound.
Leahy: That worked so well for the Weimar Republic in Germany.
Peek: (Chuckles) Exactly. We never learn from history. How would we? We don’t teach or learn history anymore?
Leahy: Last question for you, Liz Peek. When are you moving to state income tax-free Tennessee?
Peek: I want to tell you something. I mean, I have to write about this. Maybe we just got noticed from some organization that follows this stuff that bonuses, and of course, Wall Street is a bonus community.
That’s where they make their money, not on their salaries. The rate of taxation in New York has gone from nine percent, I think, and change to 13 percent in change.
Like a 40 percent increase. I’m not sure people are even focused on this. But to your point, the exodus from New York is only going to swell. And I can guarantee you that that’s happening.
Leahy: And we’ve got some Realtors here that I can put you in touch
Peek: (Laughs) Let me tell you, it’s so tempting. It is so tempting.
Leahy: Okay, we’ll see you soon here, Liz. We’ve got a place here for you.
Listen to the full second hour here:
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Tune in weekdays from 5:00 – 8:00 a.m. to the Tennessee Star Report with Michael Patrick Leahy on Talk Radio 98.3 FM WLAC 1510. Listen online at iHeart Radio.
Photo “Liz Peek” by Liz Peek.
Live from Music Row Thursday morning on The Tennessee Star Report with Michael Patrick Leahy – broadcast on Nashville’s Talk Radio 98.3 and 1510 WLAC weekdays from 5:00 a.m. to 8:00 a.m. – guest host Christina Botteri welcomed Fox Business contributor and Wall Street expert, Liz Peek, on the newsmakers line to discuss the compromising position of Joe Biden and why he will not pushback on China.
Botteri: And on the newsmaker line with us is the one and only Liz Peek. Liz Peek is a Fox News contributor and former partner at the firm Wertheim and Company, and she’s a former columnist for The Fiscal Times, writes for The Hill, and contributes frequently to Fox News, The New York Sun, and other publications.
You can visit her online at lizpeek.com. You can follow her on Twitter, which I highly recommend @lizpeek. And Liz, you’re here to talk with us about Joe Biden’s China problem.
Peek: (Chuckles) Good morning. Well, he has one. And the problem for Joe Biden is that Americans are increasingly questioning where the Wuhan virus came from. And the mounting evidence is that, in fact, it was created in a lab not originally coming from bats or any kind of intermediary animal.
The Chinese have tested tens of thousands of animals and discovered no such virus exists that they can find it. And even some of our own experts with air quotes, like Anthony Fauci appear to think, yes, this is possible that this came from the lab.
So the question is, what is Joe Biden going to do about it? And I think voters are going to want him to stand up to China on this and other issues, by the way, too. And he can’t. He can’t because he needs China’s help in selling our own or I should say Joe Biden’s own very radical climate agenda to American voters.
Joe Biden basically wants to take offline or incredibly efficient low-cost energy structure and replace it with higher-cost renewables. That will mean everyone’s electricity prices go up and further damage our competitiveness with overseas companies.
And the only way he can even possibly argue that this makes sense is if China does the same thing. China has not done the same thing. They’ve made only the vaguest promises. And of course, China’s emissions are twice those of the U.S. growing very rapidly, whereas ours have not been increasing.
It is completely a fool’s mission to undermine one of the core geopolitical strengths of the United States, such as our incredibly abundant fossil fuel reserves without China making some sort of concession.
And Xi Jinping knows this. He knows this is a very fraught issue for a lot of voters in the U.S. Joe Biden needs his help in terms of Xi Jinping also making climate promises, which so far he’s not done. He also needs Xi Jinping to make sure that we can get back in the Iran nuclear deal.
Right now that’s unacceptable because the Iranians refused to make any changes to the original program. And Xi Jinping has sided with the Mullas and saying, no, no, their original deal is good enough.
Biden, really, if this is the cornerstone of his foreign policy, which it appears to be unbelievable, he needs Xi Jinping to work with him and get this done. But the most important thing probably is that the Chinese may have compromising information about the Biden family.
We know that there are a lot of financial transactions that included obviously Hunter Biden, but also possibly his father, which originated during the time he was vice president and the point person for Obama in China.
A Senate committee basically concluded that, in fact, the Biden’s might have extortion vulnerabilities because of what went on in not just China, but also other countries. And the FBI, let us not forget, is investigating Hunter’s activities for possible money laundering.
It’s a criminal investigation, again, involving his transactions in China. So I think the Chinese government is absolutely ruthless. They will not at all hesitate to leak out damaging information about the Biden family unless Joe Biden kind of plays along.
And I think this was true when Joe Biden was elected as true. Today, the media and social media giants covered it up and stood in the way of American voters finding out about these compromising situations in China.
Now, pretty much it’s gotten out there and I think this is potentially a huge problem for Joe Biden but also, let’s face it, for the United States.
Botteri: Yeah. You’re not kidding. That’s quite a lot to take in. I think the question that a lot of people have is, what can Joe Biden do? What can he get? What can he offer? What does he have that China wants? Is it to stand aside and let China just take over Africa in its entirety?
Is it to allow no change in their emissions standards? I guess, to their credit, China hasn’t made any promises that they’re not fulfilling. They’ve basically said, what? The U.S. cut our emissions? No, thanks. (Peek chuckles) No, we’re not doing that. But even if they did, would they?
Peek: I think you ask a good question. What do they want from Biden? What they want from Biden is basically for the United States not to impede their march towards supremacy. They want to be the number one industrial nation in the world.
Obviously, they’ve made enormous progress towards that end. But Trump was a hiccup. He was a speed bump. I think President Trump did our nation a great service by calling out China’s truly criminal activities, stealing billions, hundreds of billions of dollars, according to some government sources, in our intellectual property, cheating the United States on trade, but also the world on trade.
China is a bad actor. It has never gone along with the strictures of belonging to something like the World Health Organization, as we have seen recently, or the World Trade Organization.
They cheat, they lie. They do whatever is necessary to further their own cause. We had a President, briefly who put America first. There’s no question that Xi Jinping puts China first.
Okay, that’s acceptable as long as he behaves within the norms of conventional international behavior. But he does not. And I think the answer to your question is he wants Joe Biden basically to ignore what’s going on in China in specific about the virus.
Joe Biden will orchestrate a pretend investigation. He’s asked our intelligence agencies to double down on their investigation. He will go along with a rebooted WHO investigation. The World Health Organization.
None of those things is going to get anywhere because the Chinese are basically not allowing their scientists to talk to the Western investigators. They’re not allowing those investigators into the lab to look at their research materials for their procedures.
Little by little, though, it is coming out that this is probably the origins of the virus. And I think what they’re going to demand is that basically, the West do nothing about it. You’d be interested to know, maybe, and your listeners might be interested to know that Australia, to their credit, actually did challenge the origin theory a year ago about where this virus came from.
Australia really demanded answers and was very aggressive about it. In response, China has unleashed an unbelievable trade war against Australia, for which about 20 percent of their exports go to China.
China and Australia have very big trading relationships. China has blocked or sanctioned or now prohibited the importing from Australia dozens of goods. That’s how seriously they are on the attack on this and how aggressive they will be.
What we need to do and what Biden may or may not be able to do is really get the entire EU block and the UK organized with us demanding answers from China and putting out their potential penalties.
Whether it’s trade sanctions or whatever that result if, in fact, China does not cooperate. I don’t think Biden will do that. I don’t think he has the forcefulness to do that. And as I say, he has seriously serious vulnerabilities if he does.
Botteri: You mentioned the pretend investigation, and I just can’t help but wonder are there any real investigations in the Biden administration right now having to do with the serious issues? Are any of the investigations real?
And then something else that kind of struck me. I’m not the person who came up with this, but I think it’s a very provoking thought and one that we should all remember. And it is this. In China, globalism is nationalism.
Peek: Yeah, that’s exactly right. And that has served them well. Again, whatever serves China’s interests are acceptable to China is acceptable to China. And certainly globalism and the fact that the United States will enter into agreements, for example, the Paris Climate Accord is an absolute horror for the United States.
And sadly, because we have this climate-industrial complex now in the U.S. and so little real analysis of the costs of the kind of measures that Joe Biden wants to put through. There is nothing that Xi Jinping would like better than to have America try to cut our emissions in half, as Joe Biden has promised.
Look at California. California is a state which has embraced renewables with great enthusiasm, and their electricity costs are nearly twice that of the rest of the country. Their gasoline costs are probably 30 percent.
Botteri: And growing. Liz Peek, thank you so much for joining us today. I hope you come back again soon.
Peek: Thank you.
Botteri: You always a delight. Thank you so much.
Listen to the full second hour here:
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Tune in weekdays from 5:00 – 8:00 a.m. to the Tennessee Star Report with Michael Patrick Leahy on Talk Radio 98.3 FM WLAC 1510. Listen online at iHeart Radio.
Live from Music Row Thursday morning on The Tennessee Star Report with Michael Patrick Leahy – broadcast on Nashville’s Talk Radio 98.3 and 1510 WLAC weekdays from 5:00 a.m. to 8:00 a.m. – host Leahy welcomed by Fox Business contributor and Wall Street expert Liz Peek on the newsmakers line to weigh in on Joe Biden’s Joint Session speech, ridiculous federal spending, and the prospects of inflation on the horizon.
Leahy: We are joined now on our newsmaker line by a great finance expert and Fox News contributor Liz Peek. Good morning, Liz.
Peek: Good morning. Happy to join you.
Leahy: Liz, did you watch President Biden’s speech last night and what does that portend for the economy?
Peek: Well, look, I mean, the speech was nothing. It was just a lot of platitudes that sort of reiterated talking points that he’s really been putting out there since the campaign. Obviously, what’s new is that these grandiose plans are taking shape and the way the bills are actually showing up in Congress and people expected to take them seriously. It is very disheartening to me that trillions of dollars now, trillions of dollars are being spent purposelessly.
There is no need for all this spending because what we know is that the economy was on a very steep ramp up even as Joe Biden took office. Personal income rose 10 percent in this country in January. That is remarkable. And yes, it was helped by the $400 checks that were approved in the December stimulus bill. But honestly, if you look back at job creation and where we are in employment and so forth, we didn’t need the $1.9 trillion rescue plan.
We sure don’t need another $4 trillion to be spent as Joe Biden thinks we should. I think it’s dangerous. We’re already seeing asset inflation, all kinds of, whether it’s stocks or cryptocurrency seas or whatever. All commodities are close to all-time highs and going up very rapidly. And the Fed is sitting there still pumping $130 billion a month into the economy into the money supply.
And there was a very good piece, I’ll shut up in a minute, in the last few days in The Wall Street Journal about the difference between now and back in 2008-9 when people also were concerned about inflation and it never materialized. And the reason is all that money that was pumped in then went into shoring up banks. It basically didn’t get into circulation because the banks needed to restore the reserves. Now, the opposite is true.
All this money is out there sloshing around. We know there are more than $2 trillion in excess savings. Most Americans I know this is hard to imagine, but the truth is, numerically, most Americans were not impacted by COVID. A Pew study or something or survey showed that I think two-thirds basically didn’t have a single person in their household whose income was reduced or whose job was lost by COVID.
The Democrats are using COVID still, even as it goes away as an excuse for these grandiose spending plans that basically just reward who? Big labor, teachers’ unions, and in particular minority groups that helped Joe Biden get elected. And I got to tell you, I think it’s alarming and very disheartening that the media is to sort of championing all this and not knowing any better. It’s really bad.
Leahy: Liz, it seems to me that we really haven’t had inflationary concerns since Ronald Reagan became President.
Peek: That’s correct. And again, there are good reasons for that. The reason now that there’s concern about it again. Again, you have to remember the amount of fiscal money that, in other words, government spending that is now being pushed down the pipe, if you will, is unprecedented since World War II. Do you think our country is in worse shape than it’s been in any time since World War II? No, it’s not. Consumer debt is down.
Consumers are actually fairly well off. And I understand yes, there are 10,000,000 people who need jobs but unfortunately, Congress, in its wisdom, supplied sufficient incremental unemployment insurance money, $300 a week, that now something like 80 percent of the people who lost their low-income jobs during this last several months are making more staying home. So they’re rational people.
They’re not going to go back to work at a minimum wage job if they don’t have to. And right now they don’t have to. And the Democrats extended that unemployment through September and they want to extend it even further. But anyway, yes, (Chuckles) words fail me because it’s all such a lie. This entire Joe Biden administration is founded on a lie. And unfortunately, the lie that we’re in a crisis, that’s the word he keeps using it simply isn’t true.
Leahy: Yeah. And it seems to me what’s going on in the Labor markets, particularly in restaurants now is a great example of the law of unintended consequences from bad legislation passed by Congress.
Peek: Exactly. That’s exactly right. You can’t hire people. I mean, Joe Biden, I don’t think, has ever had a private-sector job in his life. And I think many people in Congress are in the same position. I actually spent last weekend with some Congressmen Republicans and all of them had private sector experience. They had either operated businesses or ranches or whatever, but they kind of knew about supply and demand and incomes, et cetera.
I don’t think most people in Congress do. They don’t get it that if you reward people for not working, guess what? They won’t work. And right now we have 32 percent of the working-age population unemployed. Not because there are jobs out there. That’s the other thing. There is a survey called the Jolt Survey, which is the Job Opening and Labor Turnover Survey, which shows about seven million jobs available and that’s not far off from the number of people looking for jobs.
(Commercial break)
Leahy: You are always clear, concise, and on point. Liz here’s a story from The Financial Times published Wednesday or Tuesday rather. Over the next several months, investors should expect to witness an adjustment in consumer prices in the U.S., which will feel a lot like a lasting shift in inflation. The March U.S. Consumer Price Index report confirms the first step of this expected adjustment with core inflation up zero point three percent month on month. Readings for April and May could be similar. Headline, Inflation is likely to accelerate up to 3.5 percent per year on year by May, the fastest pace in a decade. Liz, is inflation coming and what should consumers do about it?
Peek: Well, actually, the economist group I follow most intently, ISI Evercore number one group on the Street. And I think they’re almost always right. They say inflation is here, it’s not coming. And it’s shown up in all kinds of ways. Oil prices are up, gasoline prices are up at the pump, home prices, consumer price index, the PPI, the number that you all were just talking about, it’s here. What should consumers do about it?
Obviously, if you’re on a fixed income, that is the group of people who are most impacted by inflation. And what can you do? You can invest in equities as opposed to debt. In other words, rely on dividends. And companies that have the pricing power to pass along inflation in their pricing will presumably be able to continue to increase earnings and pass along those increased earnings in the way of rising dividends.
The people who get stuck right now, if you put all your savings and you’re retired and you’re living on a fixed income again, those are the people who get hurt. And this hasn’t happened in decades. And it may not happen now. But the Feds argument is, yes, we’re going to have a few months here where, I love the word adjustment, higher prices is a better way of putting it, but it will be transitory.
It’ll be temporary and a year from now that we won’t see such pressure. I don’t really know why that is such an article of faith. I think what we’ll have to look for and watch for and your listeners should be on the alert for is what happens with wages. In the 70s the cycle that got us into trouble with too much growth in the money supply. And now that’s up to 27.7 percent year over year. So it’s gigantic.
Pushing prices of goods and services higher and then pushing wage demands higher. The thing that may save us, sadly, is again, that 32 percent of people not in the workforce, labor markets may be slack enough that there is not a great push for increased wages. But we’re already seeing interestingly, some companies offering bonuses and higher pay to bring people back because of this unemployment excess or unemployment payments that the federal government is dolling out.
So we may already be seeing some of that. Time will tell. I don’t have a crystal ball. But I got to tell you that this continued insertion of so much money into the money supply, I think, is worrisome because that’s money chasing something. And right now it looks like it’s going to start chasing prices higher.
Leahy: So I’m not an economist, Liz, but when I look at this huge proposed spending plan from Joe Biden and the outrageous increase in the already outrageous federal deficit and the federal debt that will come out of it, I don’t see how you come to any other conclusion other than this will be inflationary.
Peek: Well, I would agree. And actually, there are some elements of this spending program. This spend-a-thon that Joe Biden is on that is definitely inflationary. For example, guaranteed minimum wage, which he’s done by Tick Tock for all federal contractors. That’s a pretty big number. If you think about all the organizations that service the military, for example, all of a sudden you’re pushing through a pretty big wage increase for people working on supplying food to Army basis, things like that.
It sounds like a small item. It’s not. The Department of Defense is still one of the biggest spending items in our budget. So the impact of that is far-reaching. Also, I don’t think that Biden is going to get through a lot of this infrastructure plan. And I hope not, because so much of it is wasteful. But that waste, that pushing money into organizations and industries that are government spending is by definition wasteful, and inflationary because it’s not efficient.
Government contractors are not always attuned to looking for the best price or the best financial outcome or whatever. In fact, sadly, for taxpayers, they rarely are. I think that the debts and deficits are definitely an inflationary pressure. And I just think the way the government is going about spending all this money is also extremely inflationary.
So, again, we don’t know whether this will be a six-month phenomenon or a six-year phenomenon. My own inclination is everyone is so comfortable that that’s probably the mistake. I mean, my guess is that we are too complacent about the inflation that may show up. By the way, it’s also showing up now in China and in Europe.
It’s not just the United States that has seen a tick up in that number. And right now, obviously, all of our economies are somewhat linked. And that pass-through of higher commodity prices seeing, it really affects the entire world.
Leahy: Well, one thing also that we’re seeing here, and it may be localized in Nashville, perhaps in Texas and Florida, is the real estate market here, particularly in Nashville is through the roof.
Peek: You’re completely right. And what does that stir? It means more home building because one of the things that have happened is there’s no inventory of homes. I think after the financial crisis and the housing bust more than a decade ago, there was just a dearth of building. And so we have no supply right now. You’ve probably seen maybe that lumber prices are up like 80 percent.
You can’t buy what you need to build houses, and people can’t buy houses because there’s none being built. It’s really a Catch 22. But that is a sector of the economy, a pretty big sector, by the way, and certainly, it was back in 2008-9 that up until actually this time last year probably was sort of slow. And that is yet another reason to be very confident that this economy is strong. It’s not in crisis mode, as Joe Biden would have you believe.
Leahy: And I think we’re seeing a lot of adjustments in the supply chain. Adjustments that were started with the pandemic when, for instance, a car rental. It’s very expensive to rent a car these days. And apparently, that’s because the car rental companies during the pandemic to keep afloat we’re selling off their inventory. Now, there’s not enough supply of them, apparently.
Peek: Yes. And that shouldn’t surprise anyone. The pandemic created all kinds of really frightened responses on the part of manufacturers and all kinds of businesses. And legitimately, they had no idea what was going to happen next. So if you go shopping, which everyone is doing now, you find that there’s almost no inventory in the stores.
Stores of course were not doing well even before the pandemic, and we’re very reluctant to stock up on inventory. And so they didn’t. And now there’s not much to buy. And ditto. Your case is a very apt one. All kinds of businesses cut back on investing and spending on their own supply. Here’s another place where I think prices are going to soar, is on travel.
Already airlines are jacking up airfares enormously. Someone I know bought a ticket to take her family home to Hawaii in December, and it was exactly twice what it was a year ago. So all these things are going to be going up because they can. People are desperate to live their lives and spend some money.
Listen to the full second hour here:
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Tune in weekdays from 5:00 – 8:00 a.m. to the Tennessee Star Report with Michael Patrick Leahy on Talk Radio 98.3 FM WLAC 1510. Listen online at iHeart Radio.
