Americans are still living paycheck-to-paycheck due to inflation. Equities futures indicate Wednesday’s trading sessions may see stocks heal after the last two days of significant capitulation. However, the S&P 500 index is showing an ominous death cross ahead, which means the U.S. economy could face a longer-term downtrend.
The US Economy is Feeling the Rage of Inflationary Pressures. 64% Americans live paycheck to paycheck
A number of countries worry about the future of the international economy since the Russia/Ukraine war. On Tuesday, U.S. president Joe Biden announced a ban on all Russian oil imports as he noted that the world’s top exporter of crude and oil products is not welcome on U.S. soil. Biden announced this as the crude oil price soared to $130 per barrel on Tuesday.
Inflation is massive.
Soaring gasoline prices.
Rising energy costs.
Inflation in food pricesWhat are your thoughts on The Great Reset?
— PeterSweden (@PeterSweden7) March 8, 2022
The rising cost of gas and inflation are two major concerns right now. The data shows that 64% Americans are struggling to make ends meet, with only $54 per month. While wages have jumped by 5.1%, it’s still less than the pace of inflation that has surged above 7% in recent times. In fact, last month, the U.S. Labor Department’s Consumer Price Index (CPI) climbed at its fastest rate in 40 years. There’s been a rise in Americans living paycheck to paycheck as the number of citizens operating in this fashion jumped 3% higher than the year prior, according to a Lendingclub report.
Inflation will burst the largest economic bubble ever seen. The US average gasoline price is at an all time high, as well as the food cost. Since the beginning of time, the US stock exchange has been in decline. Each year, more trillions were printed by Fed to sustain it.
— Kim Dotcom (@KimDotcom) March 8, 2022
Speaking with CNBC’s Jessica Dickler, Lendingclub’s financial health officer Anuj Nayar said that the researchers have seen the “cost of everything shooting up.” Nayar further insisted that the rising gas prices and skyrocketing costs stemming from the grocery store are hitting Americans in the wallet the hardest. “You’ve got to eat, you’ve got to commute; these are not discretionary expenses,” the Lendingclub executive added. Recent statistics show that Americans are spending more on almost everything they purchase.
Americans have the option to opt-out of used cars, but they cannot ignore skyrocketing rent and food costs.
New York Times authors Quoctrung Bui, Aatish Behatia and Emily Badger (NYT) quoted many Americans saying that prices for new cars, apartments and steak have become too high.
“A car battery costs almost two times as much,” one individual surveyed said. “Bacon is as expensive as filet mignon used to be,” another person surveyed by the NYT remarked.
“This is not just a used car phenomenon,” the chief economist at Morning Consult, John Leer told the NYT reporters. “When it was used cars, you could have the option essentially of opting out of inflation. You could say ‘I don’t want to buy a used car, so this doesn’t affect me, life goes on,’” Leer added.
S&P 500 Death Cross Could Mark Onset of a Long-Term Bear Market
Stock market participants have been affected by the volatility that equities markets are experiencing. For example, the S&P 500 was down 30.39 points when stock markets closed on Tuesday afternoon, and charts show a death cross is imminent. Basically, a death cross appears when the S&P 500’s chart shows the 50-day moving average (MA) drop below the 200-day MA. As the S&P 500 has dropped, the 50-day MA is now roughly 42 points away from breaching the long-term trendline (200-day MA).
The Death Cross Checklist
Nasdaq: ✔️
Dow Jones✔️
S&P 500: Coming Soon! pic.twitter.com/8imfNAX3c0— Kimchi Premium (@cafetero7878) March 8, 2022
The baleful death cross is not a good signal and many believe it’s a sign of the economy facing a longer-term downtrend. Death crosses have been experienced by the Dow Jones Industrial Average (DJIA), and Nasdaq Composite. The last DJIA death cross event was at the end of March 2020 just after ‘Black Thursday’ (March 11, 2020) and a week later that year, the S&P 500 recorded a death cross. Just before the Russia-Ukraine war, Nasdaq registered a death crossing on February 18, 2022.
Soaring inflation, high prices for commodities and citizens who live paycheck-to-paycheck are all signs that a prolonged bear market is on the way. Each and every day, analysts and economists are discussing the possibility of a looming recession, or even worse predictions of a “greater depression.” The NYT survey respondents’ commentary highlights that Americans are angry about the rising inflation.
“As everything goes up in price, my savings diminish — Everything is going up, but our wages are not,” the report’s survey commentary concludes.
Are there any signs that indicate a recession? How do you feel about rising inflationary pressures. Comment below to let us know your thoughts on this topic.
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