Economic Storm Incoming: Here's PROOF - Rising Prices, Slowing Jobs, Confused Consumers

Welcome, everyone. Thank you so much for joining me today. Have you noticed your grocery bill creeping up again? Or maybe your favorite restaurant is now charging you even more for a meal. If that is the case, you're not alone. You're not imagining things. Inflation in the United States is noticeably ticking up again, unfortunately. And it's not just the gas station or the grocery store anymore feeling the heat. The entire food industry in the United States is now And we know very well that when that happens, things aren't going very well. Eating out is such a big part of culture here in the U.S. And I would like to dive a bit deeper into the rise in food prices because judging by your comments to my recent video on inflation, many of my subscribers have already noticed the strength and are growing very frustrated, very concerned, very worried, and rightfully so. Let's talk about what's really happening with inflation, why it is rising again despite cheaper gas, and how it's changing the way Americans eat, spend, and live ultimately. And we're going back to the latest official data. Core consumer prices, the ones that strip out volatile food and energy, rose by 0.3%. That might not sound like much, but it's actually the biggest monthly increase since the beginning of the year. The biggest monthly increase. So this is bad news. And it is being driven in part by something that we've been hearing about for years now, tariffs. Higher import duties on goods like furniture and recreational items are starting to trickle down to consumers. So this has already started to show in consumer prices. Retailers who initially held off on passing on those costs to us customers are now gradually raising prices. And partially it is due to the fact that their inventories are running low and so they have to purchase more, they have to restock at higher prices. So naturally they're not going to cut into their profit margins. They're going to pass on those additional costs to us, their customers, their consumers. So that means that your new sofa, your kids' summer toys, your kids' Christmas gifts, it is coming up just several months away, and even some everyday items are all inching up in price. Yet overall inflation, what's called the headline CPI, rose just 0.2% thanks in large part to falling gas prices. But that drop at the pump isn't doing much to soothe the bigger issue, the slow steady return of price increases across the board. So it's not going to effectively have that wash effect at the end of the day because we are seeing price increases across the board. We're seeing the very beginning of this process at this point in time. Now here's where it gets complicated for the Federal Reserve. They've kept interest rates steady for most of this year, trying to wait out the storm and see if tariffs would cause long-lasting inflation. So they have been in that wait and see mode. But while prices are creeping up, something else is slipping, and that of course is the job market. And that's really one of the worst things that you can imagine at this point in time as the economy is slowing. Hiring is cooling in the United States, and that's also across the board, across the states, across the industries. And while that sounds like the kind of balance the Federal Reserve would like to see, it is creating real anxiety for everyday Americans. When people start worrying about job security, they change their spending habits. And nowhere is that shift more obvious than in the restaurants across the United States. And that is something that all of us can relate to. And I think this is a great example that shows us how prices are changing. And you don't really have to look far. All you have to do is go out for dinner, go out for lunch, for breakfast with your friends and family, and you are going to notice that too. The most noticeable change in consumer sentiment and spending patterns is now evident in the food industry. Americans are eating out less, a lot less. Eating out is a big part of American culture, so when that shift happens, it should be taken as a quiet, serious signal. It is a sign, and it is definitely a negative one. Between January and March, Americans ate one billion fewer meals at restaurants than they did during the same period last year. One billion meals less. And that's not just a fluke. It is a sign of something much deeper. Consumers are pulling back. That is the conclusion. Consumers in the United States have already started to pull back. They're eating at home more, skipping breakfast runs, cutting back on drinks and appetizers and all of those nice things that we all enjoy. And they are also trading down to cheaper meals. Even the biggest chains are feeling it. Dime Brands, which owns IHOP and Applebee's, which we see in every neighborhood, warned investors this week about slumping sales. Wendy's, Denny's, and even Chipotle. They're all seeing fewer visits, especially from lower income customers. McDonald's CEO recently said it quite plainly. Low-income diners dropped off by quote double digits between April and June. People aren't just spending less, they're visiting less. And that is a big deal when your business relies on routine traffic, when your business relies on sales to survive. This is a big issue for small mom-and-pop shops across the United States that rely on consistent demand. Expect those to cut their operational costs soon by laying off people. They just don't have any other way to decrease their operational expenses to stay in business. It's as simple as that. It's not just fast food either. Even casual dining chains are being forced to offer more what they call value deals to lure back their customers. And these are quite clearly survival tactics. And even with those offers, with those value offers, it is not clear that they're working. As prices at restaurants climb faster than groceries, the appeal of home-cooked meals is of course growing. Inflation for food at home rose 2.4 percent over the past year, but food away from home is up 3.8 percent. The gap is growing, we can see that, and it's pushing people back into their kitchens, which could be a good thing arguably because we get to have more meals with our families and we get to eat probably higher quality food that is homemade. But at the end of the day, we're talking about overall trends that we see in consumer demand. Restaurant chains are a lot hoping at this point that this is just a temporary dip, but if job market anxiety lingers longer and tariffs keep driving up costs, temporary might become the new normal. And arguably it has already become the new normal. And let's not forget, this isn't just about inflation or food, it's about consumer confidence. That's really what we're talking about. We're talking about consumer confidence and we're using food and the food industry in the United States as an example here because it's truly a great one. When consumers feel confident about their jobs, they're more likely to spend, they're more likely to grab that lunch on the go, splurge on dinner with friends, with family, or take the family out on the weekend. But when confidence drops, as it has in the United States, even by a little, spending habits shift dramatically. That's what we're seeing here. This is what we're discussing. That's why restaurant chains are sounding the alarm at this point. They're not just seeing softer sales, they're hearing from customers who are stressed, who are cautious, and who are watching every dollar, every penny. Why are they doing that? Because there is real concern about future job prospects and general anxiety about where the economy is headed. Clearly nowhere good. So where does all of this leave us? Well, inflation is creeping back up, driven by hidden forces like tariffs and lagging price hikes. The Fed is stuck in a holding pattern at this point. It's unsure whether to cut rates or to hold steady. We know that there is a great political pressure on the Federal Reserve to cut rates. Whether it will happen or not, it remains to be seen. The job market is wobbling, and that is something to watch at this point. And consumers are reacting the only way they know how, and that's by pulling back. The last place where Americans were still spending freely was food and beverage, and now even that's slowing down. Will things bounce back by the end of the year? That depends. It depends on jobs, on confidence, on whether inflation cools or keeps rising, and on whether consumers feel like they can finally breathe again. Let me know in the comments what you think about this. Are you seeing the same price increases in your area? Let us know in the comments, and also let us know where you're located so we can get a better sense of what's going on across the United States. Thank you so much for watching. If you found this quick breakdown helpful, hit like, subscribe, and also follow me on Substack and Patreon. I would love to see you there, and I certainly appreciate every single one of you and your continued support. Enjoy the rest of your day, and I will see you back here tomorrow. Take care.