Stagflation, NVDA Earnings, Guitar Practice, And Much More

Here’s the transcript from today’s Live Q&A Chat:

Q. Not to be negative/pessimistic but there are signs of stagflation around the world. Doesn’t it feel inevitable that it’s going to hit here as well? Inflation is being persistent/stubborn and economic output is starting to slow. Is this all the aftermath of the enormous amount of money printing during 2020 and subsequent government spending? If so, the current equity market setup is vulnerable to a major correction.

A. It’s okay to be negative/pessimistic sometimes and it’s always good to ponder both positive/optimistic and the other side to understand both viewpoints. Let’s define stagflation: “persistent high inflation combined with high unemployment and stagnant demand in a country’s economy.” We are a long way from high unemployment and The AI Revolution alone is driving hundreds of billions of dollars of demand. The low-income consumer is struggling for sure. The middle-income consumer is increasingly feeling the heat from inflationary pressures and higher rates and bubbled-up home valuations. The wealthy are feeling wealthy with stock prices, housing, and so many other assets at all-time highs. I think productivity is going to kick into another level as The AI Revolution makes people and companies more productive than ever. The Republican-Democrat Regime has always borrowed as much money as possible and printed as much money as they think they can away with for my entire lifetime and it’s going to come back to roost someday, but I’m not sure it’s coming tomorrow. I do think the markets are stretched valuation-wise and are overbought and there’s too much greed and too little fear out there and a 5-10% correction would be healthy for the broader markets regardless of what the broader economy is doing.