Inflation is not goddam transitory!!! Stupid!!! 🌈 🐻
So Jpow has been cranking the printer handle like his own meatstick at a furious pace. 120bn a month and stonks are flying to the moon, hedge funds partying and going all in on 20x leverage like degenerates. Margin loans are through the roof, higher than never ever ever before and Jpow tells us at this point that inflation is transitory.
Lets explore what that means via an easy to follow macdonalds example.
Suppose you work at macdonalds, i know they probaly dont hire people on the spectrum but bear with me.
Lets say you make 12/hr as a human hamberger robot. Prior to pandemic, you barely survive on your salary. But having now lived 1.5 years on gov assistance, getting paid more than your shitty ex job to do absolutely nothing, you are planning to max out this insane period by taking benefits until they kick you off. Meanwhile you look around the shops, everything is more expensive, food, drink, rent, houses, even the cheap Chinese made tshirt is twice the cost as before. Why? The dollar is down and raw materials are more expensive, shipping is higher, oil is higher. Cotton prices are through the roof, bread, fuck me it is up, pork is ridiculously high… In short there is nothing that is not up a huge amount.
What does that add up to? Previously you were just barely surviving with your shitty 12/hr, now, if you go back to work, you will lose your pandemic unemployment assistance, which means a hefty pay cut while all prices have risen massively. You simply cannot afford to start working!!! If you work, you will work yourself into your moms basement because you wont be able to afford rent, will lose the free health care and still barely breakeven. You are below the watermark on being able to survive as a human.
This means only one thing. Macdonalds is gonna have to raise wages and fast if they still need humans pretending to be a robot. Once they do, they will have to raiss big mac prices further to compensate for this and the 100% higher price in every single input cost of the hamburger. And once that starts it means you will need a higher wage again because you cant afford to eat and round and round it goes into an inflationary spiral.
By this process, once the fed gets its wish of unemployment falling, inflation will be in the teens, dollar will crash another 20% and they will need to hike to 15% interest rate again like in 70s.
Tldr. Inflation moves up in spirals. It has already started and cannot be stopped. Jpow has no idea what hes talking about. Full on 🌈 🐻. SPX puts.
Positions: SPX puts, jun, july, aug, sep, dec, in many different strikes.
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May 12, 2021 at 08:30AM