RECESSION 2022? Will The Fed Create or Postpone the Next Recession? FYI Recessions are not all bad

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good morning good afternoon good evening

folks michael’s uber one retail at a

time back with the man the myth the

legend and great friend of the channel

and returning 2022 guest mr greg

dickerson how you doing sir doing great

michael looking forward to another year

of these great conversations yeah i look

forward to starting the week with you

every week so thank you again for doing

it for me to you it’s it’s a great treat

to talk to you every monday morning

so what i want to talk about here is

something i have called for the last

month or so i’m going to share it with

you and then kind of see if 80 you agree

maybe disagree maybe you’ll push it off

uh and then b uh talk about the fact

that you know it’s often a great time to

make some money and that is the fact

that i think the fed

has to induce a recession next year i

think they have to get aggressive

eventually tight monetary policies suck

out all of this liquidity which i think

leads to a recession

and uh so i just wanted to talk about

that first so i think a recession

happens sometime next year maybe q2q3

what do you think about that you know i

don’t know about recession you know that

is a reduction in gdp you know for a

sustained period of time of what was it

i’m looking for the definition of two

quarters in a row

no recession is negative gdp two

quarters in a row yeah two okay just

negative not not a certain percentage

not a percentage just negative growth

two quarters in a row okay you know i

don’t know how that happens i mean we’re

not having you know an issue well you

know it depends on how many people are

back to work and you know the the um you

know pandemic and where we stand there

but let’s just say everything’s you know

we’re over that we’re getting back to

work and everything’s going well i don’t

see you see how you can reduce gdp i

think gdp is going to continue to

increase because we’re still kind of

limping along from a supply chain

standpoint

um

you know a lot of things are

artificially propped up because of

inflation prices have gone up yeah so

that’s also going to increase gdp

absolutely right now it’s revenue right

so one of the easiest ways to increase

top line sales raise your prices yeah

and you’re very you’re dead on because

uh just so people know what he’s talking

about q3 gdp growth memory serves was fi

no 3.1

but inflation was 5.2 so again we if you

actually do the math

like for like we were negative two

percent but that’s not how gdp is

calculated so you’re absolutely right

yeah it’s top line sales and the

president can stand up and say hey we

did gdp eight percent you know five of

its inflation yeah or or yeah ten of its

inflation it actually went backwards oh

so it’s interesting so i don’t i don’t

okay see

recession

because you know more and more people

are going back to work there’s still

demand we’re still producing as fast as

we can

um you know the only thing that’s

restricting production right now or

supply chain you know you can’t get

things from overseas um

you know so i just don’t see

that happening but i do see

like we talked about before

you know deleveraging in assets that

could be perceived as recessionary

environment um but you know in terms of

you know slowing down

actual gdp i just don’t see how that’s

possible there’s too much demand yeah

we’re gonna see i i still think a

recession is coming next year i love the

fact that we disagree the only thing

that could happen is maybe the recession

gets pushed to 2023 kind of for the

reasons you’ve outlined this is what

this is what i see coming and just i’ll

just lay the dominoes out and i’m wrong

all the time so but anyways i see the

fed having to get aggressive as we

talked about in episode number two i

don’t think they start aggressive i

think they get behind the curve

and when they’re behind the curve when

cpi gets reported at 11 in q1 for

example then they’re gonna have to slam

on the brakes they’re gonna have to just

come out and i think they’re i think

they have i think they’re gonna have a i

think we’ll have a fed induced recession

because

they’re not gonna get aggressive this

week they’re gonna be late to the party

once again

and then

bad stuff happens next year i’m

hopefully i’m wrong but

how do i see this interesting you know

we haven’t seen through the pandemic

going back to march 2020 you know on we

haven’t seen significant pullback in

consumer spending we still increase yeah

well that’s kind of like five trillion

dollars just raining down on people so

a little bit of that was part of it but

for the average consumer most people

didn’t didn’t take advantage of that you

know you got maybe a little bit of

stimulus you know those types of things

a lot of jobs were lost a lot of

businesses had to close but people even

you know out of work were still out

spending money they still are now

uh you know it’s really interesting um

you know what’s going on with the amount

of people that have exited the workforce

you know there is a lot of wealth out

there because of assets because of the

stock market exactly

yeah you know crypto i mean it’s the

numbers of people that have quit their

jobs to make a full-time living in

crypto i mean it’s a big number i you

know i read an article about it a few

weeks ago 90 000 people or some yeah

it’s it’s that again folks i’ve lived

through this before there’s people that

were making there i had a so i was a

manager back in the dot-com

run-up and i had a direct employee quit

to become a day trader

it worked for like six or seven months

and then he had to go find a job and

again a lot of people have been able to

do that but that’s been you know over

the last year we’ve had a very

extraordinary environment because of to

your point all of the helicopter money

part you know pumped in the economy now

the government you know with their

stimulus spending that’s going to pump a

lot of you know

liquidity into the economy apart from

the fed with infrastructure spending and

things like that so there’s still you

know a bunch of that yet to come but uh

the interesting thing is how many people

even though we have record you know

levels of people unemployed or not

working exiting the workforce you know

that’s not affecting spending which is

where gdp really comes from you know

well let’s play this out again this is

what i see coming and i don’t i don’t

like what i see but it’s what i see so i

have to share it so i think the great d

leverage as we talked about last week

and again in episode one that would be a

lot of wealth destruction right there

are a lot of people that feel good today

because the last 12 months has been easy

to make money i believe the next 12

months and certainly the next six months

won’t be as easy as the last 12 months

people start losing money losing equity

they sell a loss they raise cash they

get scared they retreat they start

spending because of holidays and lo and

behold they got nothing left march or

april that’s kind of what i tax bill

that’s when your tax bills come in so be

ready be ready yeah don’t forget uncle

sam wants his piece so yeah that’s

that’s kind of where i see right now i

just see kind of a

i see the house of cards crumbling kind

of right in front of me i’d love to be

wrong

yeah it’s interesting you know we’ll

we’ll just have to see how it all shakes

out and you would think that if you know

people are going to pull back and start

building reserves up again it’s going to

happen after the first year because you

do have tax season coming we’ve gotten

through the holidays where everybody’s

happy spending they’re not going to pull

back now

uh you know that type of thing you know

record retail sales we got retail sales

i think wednesday i think it’s going to

be a record because again we’ve got 1.3

trillion dollars in excess savings still

we have every freaking retailer telling

us about delays nothing is on sale

people are going to shop till they drop

and then they’re going to turn around in

january or february and oh my god my

credit card bill i got no money left

it’s

the consumer is predictable and that’s

just what i see coming yeah and i saw a

report a few weeks ago that you know

consumer debt you know credit card debt

is on the rise

um you know obviously holidays has a lot

to do with that people have been

spending ahead of the holidays this year

because of delays and shipping but you

know the interesting thing too is a lot

of people are tapping that equity in

their in their real estate in their

house started yeah i saw that yeah so

that’s that’s leaking its way out um you

know into the economy so yeah it’ll be

interesting to see you know recession

it’s just hard to see that because we

really didn’t even have one

in the pandemic other than just being

shut down yeah we kind of introduced

yeah yeah yeah once we were able to open

back up boom is off to the races so

you know uh i think we still have more

opening to do we still we still have

more you know production that we have

not um you know put back into the system

yet so it’ll be interesting to see yeah

i i love this conversation we just

disagree i think i think um

yeah

that’s why i talk to experts just to

kind of round out my decision i don’t

pretend to be right all the time i just

kind of share what i share and we’ll see

what’s going forward so again the reason

i wanted to talk about a recession

specifically with you as an entrepreneur

is if we have one and again we will have

one is it next year the year after the

business cycle is undefeated recessions

are a great time to make some money if

you’re prepared is that fair to say yeah

absolutely you know you want to have

cash and or resources available to take

advantage of opportunities in

recessionary times just like any any

time you know markets when they’re up

times are good but it’s a lot of times

it’s harder to make money in a bull

market especially in the peaks of it um

it’s much easier when you know you’re

back in those valleys again uh and able

to take advantage of opportunities

looking for the next round and you know

we saw some of that with all the

businesses that you know unfortunately

went out of business a lot of new ones

are reopening when real estate values go

down people jump in

you know when stocks are

you know tapering and deleveraging

people jump in and buy them and then you

can ride it back up you know most of the

people who have made significant money

in crypto have all made it in the last

year that were newer uh when they bought

in you know after the pandemic and wrote

it up and you know it’s a little bit

more difficult now uh and then the ones

that made the real money are the ones

that bought in you know two years ago

and right those things so it’s a little

different now you know and that’s where

your opportunities are going to come in

as we deliver you know as things slow

down you know prices change and it

creates opportunity to go in there and

create value create equity uh and you

know take advantage of those

opportunities very cool it’s a lot of

fun so again if you were going to call a

recession you’re certainly not calling

one next year would you put one out 2023

2024 or just you know see one coming for

a while

i just don’t see it happening

in the sense that we’ve experienced them

before especially

with

fed policy because if things start to go

south they’re just going to jump right

back in yeah that’s and that’s the

bugaboo right i don’t think the that’s

where i that’s where

my opinion hinges on that right i

believe the fed can’t do what it’s done

the last five times which is the fed put

i believe they realize now they’ve got

it they’ve got to suffer short-term pain

a la paul volcker or this thing just

explodes so now if they pull if they

pull the plug and the fed you know just

lets rates go up and they they are not

uh pumping liquidity they’re not buying

bonds assets you know things like that

and they just let it play out then yeah

you could you could potentially see some

recessionary environment then because

prices will rise people will pull back

they stop spending you stop spinning you

stop producing and the whole

trickle-down effect

um

you know but that would that would be

the catalyst and

i’m just not sure and you have an

election year coming then the fed’s

going to pull the foot off the gas yeah

we’ll see it’s going to be

this is this next year is going to be

very interesting 2022 won’t be like 2021

2021 was kind of

again it was it was kind of the leverage

was building i think 2022 is going to be

very interesting for entrepreneurs and

investors so stay tuned

big year coming we’ll be there we’ll be

right there with you to take you know

show you how to take advantage of it and

we’re going to be talking about specific

ways to do that so 2022 is gonna be a

lot of fun yes sir and how can people

follow you

greg dickerson.com that’s where all my

info is youtube podcast go check it out

thank you buddy

 

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