Lets discuss the $30 Trillion Dollar US Debt, why the Federal Reserve is raising rates, and how this could be a problem for the future of the market – Enjoy! Add me on Instagram: GPStephan
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THE DOLLAR MILKSHAKE THEORY:
This is based on the fact that – the US dollar serves as the reserve currency for the entire world.
However, as other countries begin to slow down, relative to the United States, their currencies DECLINE in value, making it more expensive to pay for good and services in US dollars…right at a time where they can least afford it. It’s called a “Milkshake Theory” because – in this scenario – the US would extract more dollars from around the world, resulting in cascading defaults throughout every other large economy.
All of that is to say that – people are borrowing more, to pay for products and services that cost more, and – if the economy enters a sharp, and sudden recession – DURING a time where interest rates are going UP – people may have a MUCH MORE difficult time paying down their debts.
Effectively, borrowing can only be sustained for so long until – eventually – it’s going to result in a time in which people begin to cut back…substantially. In fact, JP Morgan just recently came on record to say that “they’re bracing themselves and we’re going to be very conservative with our balance sheet” – while, at the same time, banks become WAY more careful in terms of who they lend money to.
On the one hand, in terms of our own National Debt – some experts say that – when you look at our debt, in relation to how much we MAKE – it’s actually NOT that bad, and we’re actually quite a lot lower than many other countries. You can see here that, sure, we might OWE the most amount of money…but, we also MAKE quite a lot of money, as well.
HOWEVER…others say that this debt is a a massive issue…because, over the next three decades…it’s projected to increase past 200% of GDP…at the same time when “interest payments” would be the single largest US Expense. At that point, social programs and spending would be severely reduced – and, we’d be forced to go further and further into debt, hurting our entire economy as resources dry up.
That’s why – we’re in a weird spot. On the one hand, The National Debt isn’t an urgent issue – and, it could be easily swept under the rug for another few decades…BUT…we ALSO can’t have an economy with perpetual 8% inflation…so, there’s no other choice but to raise interest rates, shock the market, and then – hope that demand will eventually match supply.
So, in terms of what to PRACTICALLY DO…realistically, it’s best to stay away from ANY AND ALL CONSUMER DEBT, avoid variable interest rate loans, and ALWAYS do your best to save at least 20% of your income. This should put you in a better position to weather any economic uncertainty, and continue investing during a time where prices are lower.
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SLOW DOWN YOUR HANDS
I’m happy to pay double in taxes if it lowers our debt (think about the bigger picture)
I used to be such a big fan of our videos back in the day. The constant aggressive clickbait has eroded the amount of integrity I once viewed you as having. I think it’s time for me to leave.
He’s always been upfront that it’s about the money
You are wrong. The strength of the dollars is the strongest it has been in decades. No one cares about the debt
Buy Gold
Unsubbed
The main takeaway I get from this is that the US is gambling on the future of innovation eclipsing the current GDP. 😅
🤞That Tesla gets their AI robot working for us sooner rather than later. 🥲
Did he do something with his hair?
Great video 👍
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Seriously…
Thanks for sharing, Great video. Regards forma Colombia, South America, where interest rates are even higher (our government just increased to 7.5% Annually, which means banks are significantly higher)
This guy is a master clickbaiter
Wave your hands around more when you talk.
Stop moving your dang hands all over the place!
Unsubscribed for clickbait
Starting to sounds more like Dave…
The FED will continue to act upon their goal of lowering inflation which is needed despite how the market reacts. However, I do feel a lot of the mayhem is self imposed and a self fulfilling prophecy if you will… I think we are really just getting started in terms of the dip… Yield curve only recently inverted so that is about a six month timeline at least to recession… Coming to end of the month is Powell’s 75BP hike… YikEs!
Do you guys think I should keep my short selling positions open ??
Great info as always, Graham. I’ve learned to ignore the titles because they are becoming a bit more sensational, but the content is always there. The economy IS volatile right now. Make sure to follow your own advice. It’s going to get worse before it gets better.
Thanks for the content!
Dude I’m so tired of these clickbait videos with the thumbnail where you have a super concerned face.
No one becomes wealthy with diversification. Wealthy people choose to diversify to protect their wealth.
Bingo, finally someone gets it.
Love your sense of humor and intellect! Brilliant!
Looks like we gonna go to war soon
I like your videos.
Just wish you could narrate a little bit slower.
Not kind of a business it is a business!
Clickbait.
This is the 5th time this month!!!
Doomsdayer
Graham, you’ve seen the comments on your recent videos. Stop with the clickbait; it’s not good for your channel long term. I will not be watching these videos with sensational titles.
Great informative video !!!!
The ruble is going to be the global reserve currency.
You piss me off graham. You are so negative for clicks. Most are down 50% plus already on stocks. Give it a rest
we are already paying a lot more taxes now, because we are paying the same percentage in a a way higher purchase cost
Everyone is already talking about this he’s just milking views. What I’m wondering is why nobody is talking about is the corporate bond debt. $10.1 Trillion dollars of corporate bond debt…..again $10.1 Trillion dollars of corporate bond debt. Why again is nobody talking about this.
Clickbait. Dislike
SPY PUTS IS THE ANSWER
Instead of cutting social programs, stop giving tax subsidies to the massive multinational companies who don’t need them. If they still want a tax break, pay your workers more, buy state of the art equipment, upgrade work facilities to the safest standards, etc.
What do you mean no one is speaking about it? It’s all I’ve been fucking hearing about since Nov 2021 jfc
YouTube masters of click bait. Does all his info do anything for you….not really. Makes him rich tho
Social Security is financially self-sufficient, funded by the payroll tax. Far from being broke, the S.S. retirement trust fund has a $2.8 trillion surplus. And not only hasn’t S.S. added a dime to the deficit, it is forbidden by law from doing so.
That’s false. Read the Social Security Trustee report to Congress.
I need proof you read every coment😁😁😁😂
I love you Graham but stop scaring your viewers nothing has occured yet, atleast this “bubble”
The armchair economist
@change Expert mr graham not xpart
How many times can the bubble actually pop?
Crazy stuff !
$30 trillion with a 9% interest rate is a lot of money we’re going to be paying just in interest rate.
what to do? diversify our investments. in other words you don’t know
Came for the clickbait. Left because got clickbaited.
We need to pop all of financial system bubble to stop all the scam and fraud bubbles 🤬😡
I was afraid of this with people getting thousands in unemployment (while still working BTW).
And the prices could fall. Well we can only hope
The room you do your videos in looks very depressing..
What’s your Opinion on tax liens ?
Close the tax loopholes for the wealthy and tax churches. Lower and middle classes pay enough.
Lmao @ the “half converted garage” piece. I always wondered how you got the car into your office. Totally flew over my head you actually brought the office to the car hahaha wow I feel dumb.
Thank you this video. I liked how you kicked the ass of your friend Kevin. You deserve more. Nice job
I think graham has mixed soap with water and now makes videos on the experience of popping the soap bubbles.
“omg I’m overly invested in stock and housing, I’m just gonna dollar cost average, it will all work out….Won’t it?”
While I believe there are definitely bubbles out there, these clickbait-like videos are getting annoying.
And I’m speaking as a fan.
So true.
better cut the damn welfare and other give away programs we paid in to social security best to start vote them and vote them out
Putting our time and effort in activities and investments that will yield a profitable return in the future is what we should be aiming for. Success depends on the actions or steps you take to achieve it.
AWWWWWWWWWW poor people with access to credit can’t over-extend themselves as far for investment . waaaaaaaaahhhhhhhhhhh
History shows that over the long-term (decades) we are likely to keep printing money. If the recession gets bad enough, the government is more likely to try to infuse more cash than to stay removed from the situation. That will lead to more inflation. The vicious cycle has already started.
I’m betting we’re going to get massive hand outs leading up to midterms. Market up until then and massive crash next year.
Demand is going down because it’s going up for other currencies, you must look at the problem from the broader perspective, yes before other currencies impact was little and didn’t have much of an impact, but maybe just right now it’s starting to go through the cracks of the systems.
Is that a jigsaw puzzle on your table?
This is an important issue but I don’t know anyone who could save 20% of their income and pay all the bills.
According to Graham this is the 30th bubble to pop in 2022.
True.
He’s been saying the same thing since ’19, even a broken clock …
Which bubble is gonna pop next week I wonder
THIS IS GOOD. PEOPLE WILL FINALLY WANT THEIR HEADS.
That’s a “chic” garage
Graham……it may be interesting to discuss the relationship between Oil and the US dollar. Ive always felt that our $ was tied too strongly to petrol and often comtemplate what would happen if our so called allies (Saudi) started taking rubles, yen, euros or gold as payment for oil instead of US dollars.
Every family has that one person who will break the family financial struggles, I hope you become the one 🙏
Yes, I’m also a testimony of Anna s Wilson trading services
I’ve been investing with her for months now and I’ve made a lot of profit from her. Most of those traders who offer to give you %500 of whatever you invest might not be professionals.
@Maxie Charles How much is okay to start?
@Maxie Charles No doubt, she has brought me out of the wrenches and to a better living through her trading service
@Maxie Charles I will recommend her for newbies to trade with her
Graham. Your explanation with chart at 7:50 of per capital is incorrect. Per capital means debt per person and not how much income we make. The $60,528 US number is debt per head (person). Otherwise good video with good information. Commence recession!
Scammer
Clickbait titles or not, I don’t care because Graham is the man!
More bubble popping clickbait from Graham. Someone pop his clickbait bubble, please.
sounds like we’re just in time for “a great reset.”
Ryan Trahan alert
The only immediate solution is reduce spending not increase taxes. Increased taxes increases economic strain.
Looks like a onion bubble
Why should you save money when inflation is 20%+ and savings rate is maybe three percent. It makes no sense to save money. Say thanks to Alan Greenspan, Ben Bernanke, Janet Yellen, Jerome Powell for this mess.
Hows the boxing going?
Fake economy that has more debt than its actual gross domestic production. US economy, is like a inflated ballon.
Somali colorful money was low key offensive. Somalia has a great financial system. You should look into it 😉
Have we ever stopped printing money?
They need to bring back the dislike button counter. Graham doesn’t really care anymore. It’s just about milking the subs he has for clicks. I think he’s been done with YouTube for awhile and will just let it die. He’s got plenty other stuff to do now. It’s just really cringy that all of his videos have top comments saying he’s turned to crap and he just keeps pumping the clickbait crap
👆👆👆👆👆👆
Or just stop spending borrowed money and stop borrowing
It seem to me that demand, in fact, is NOT on the decline. Why it seems like that is because we can’t actually buy the crap we want due to shortages in EVERYTHING!!
📩👆👆….,
Bro just tax the rich. Kinda crazy how times like this, the rich got richer and the poor got poorer. and the gap is getting wider and wider.
Jason with the bad take
Can someone explain this in plain terms?
📩👆👆..👆👆👆👆
Thank you, your advice helped my family grow our local business into multinational drug exporting company
Lmao
I hate how much you move your hands to talk.
👆👆📩👆👆..
😂 p♥r♥o♥m♥o♥s♥m
ACI made its earnings today
8:20-Well,about that….
With the gdp being now 21 trillion $,the debt is almost at 150% ALREADY!
📩👆👆..
Can u do the inflation reduction act