Recorded on February 11, 2020
On this episode of New Business Paradigms, Rinaldo and Kristy discuss worrisome signs of a lagging economy that is ill-prepared to lift itself back up when it inevitably stumbles. The GOP’s so called “Tax Cuts and Jobs Act of 2017” gave away as much as possible to the top 1% and Wall Street corporations to the detriment of many homeowners, main street business owners and others who depend on a weekly paycheck and other social benefits to survive. The US economy and regular people alike are feeling the repercussions of that decision now in the form of a historically high budget (that also cuts social safety nets), a ballooning national debt, and an over-valued stock market that’s getting too expensive for companies to boost their performance further with stock buybacks. Look out for some correction.
The show then turns towards other economic indicators. Due in part to the new coronavirus, now officially named covid-19, global markets are becomingly increasingly volatile, and this is just the beginning. The VIX is up and oil prices are low, and these trends make gold as good an investment as ever. The show ends with a discussion of how industries must adapt to changing times to survive. Rinaldo briefly discusses REITS (Real Estate Investment Trusts) and gives the example of shopping malls reforming to adapt to the new market for delivered meals. There is also a brief discussion of the shrinking trade US trade deficit with China (not such a positive thing after all).