Bannon’s War: Steve Cortes, Putin as Economic Patsy. March 16, 2022.
The Economy: Guest Steve Cortes. March 16, 2022.
Transcripts from Bannon’s War Room on Rumble: Steve Cortes, Putin as an Economic Patsy Published March 16, 2022.
Dr. Peter Navarro:
You got some breaking economic news. Tell us a little bit about retail sales, consumer confidence, and let's get your take on where we stand and what this Ukrainian peace deal might mean for the stagflation woes facing us.
Steve Cortes:
Yes, Dr. Peter saw this news just hit the wires. This is new economic data and by the way, a lot of data rolling in and all of it, frankly, terrible. And the latest terrible news is retail sales, very disappointing, for the month of February. And, by the way, I’ll get more to this point about this not being about Putin. In February things were heating up, but no real action there until the very, very end of the month. Retail sales only up .3 percent for the month.
What we saw within this report not too surprising if you dig into the details. Sales of gasoline absolutely soared because the price soared so much, online sales which tend to be far more discretionary, online sales plunged resulting in a barely positive read. And when you factor in the overall rise in prices, Peter, it's actually a negative read. Meaning real retail sales adjusted for inflation actually fell. What I mean by that the nominal number, the headline number is up point three percent, but consumer prices, according to the CPI Consumer Price Index consumer prices for the month up .8% percent. So, you would expect Peter, at least an increase of .8, that would just be a natural rate of increases with prices. In other words, we had 2.5 percent, net decrease for the month of retail sales. This is very, very disappointing in real terms.
Dr. Peter Navarro:
Yeah. Quick question. Did it miss expectations? I mean what was the expectations coming into that?
Steve Cortes:
Yeah, it did miss expectations versus .4 expected. Look, here's the thing. I think when we look at the economy right now, it's very clear what the Democrats, what Biden, Pelosi Schumer and all of their acolytes and the complicit and bias corporate media, what they're trying to do. They think that in Putin, they have bought a patsy for these economic woes for this absolute economic crisis, which America was already mired in well before things got hot over in the Black Sea.
They believe that they've found a beard to cover for their economic sins for their complete failures. And by the way, let's show a chart here. This is from Paul Krugman. This is chart 2, folks in the control room. Paul Krugman of the New York Times certainly got this memo and he can be depended on to always promote and unfortunately propagandize on behalf of the Democrats. Yeah. “How to avoid a Putin recession”. I mean, this is, you're chuckling and its laughable for everybody who has an understanding of economics, anyone who understands financial markets, but I think it's laughable for anybody in small business.
Dr. Peter Navarro:
By the way, Steve, When Donald Trump got elected and in 2016 Krugman had this big column out about the Trump depression, right, and how’d that work out. Anyway, go ahead.
Steve Cortes:
That's right. Trump depression and he also sell all your stocks and of course the economy and the stock market both did nothing but sore for the following years. So, yeah, he couldn't be more worrying and they give out here. Apparently, they give out Nobel Prizes very easily these days, but the point is, he got the memo. We were not going to be fooled. The audience out there needs to be educated. I think they already know it from their own experience what you have already experienced in terms of the cost in your life soaring, and your income not keeping pace.
That means that's the definition of real wages, wages incomes adjusted for the prices you have to pay for the items you want or need. Real wages have now been falling for 12 straight months. And this brand new retail sales data only confirms what's going on with real wages. When you real wages are falling it's hard to spend aggressively and it also saps confidence and I want to show that chart now please too, chart number one. And this is on consumer confidence from Morning Consult. Morning Consult does this on a daily basis. So, this is one of the indicators I like to go to. They serve 6,000 consumers. It's broad-based and its extensive.
Right now, unfortunately, for those who are watching, if you look at the very right side of that chart, you will see that we have broken to a new low for the trend and most importantly, this is yesterday for the first time as of yesterday on the Ides of March, the consumer confidence survey of Morning Consult broke the spring of 2020 lock down lows. Think about that Peter. Think about all the progress that we have made as a society in terms of dealing with COVID, in terms of being sensible, at least, in most parts of the country. Being sensible about risk mitigation about getting back to work about reopening and yet consumer confidence breaks those lows because of Joe Biden's inflation.
Dr. Peter Navarro:
So, this quick question here, So, this is not the conference board consumer confidence of those days. This is kind of a real time day-to-day kind of more real time, confidence. This incorporates the Ukraine and Russia issue.
Steve Cortes:
This is very real time. Yes, that’s the chart as of yesterday.
Dr. Peter Navarro:
So, we have retail sales missing expectations on the low side. We got consumer confidence at below pandemic lows. What's your forecast for a recession in the U.S. and will it be a consumer led recession or an investment led recession?
Steve Cortes:
Well, it looks like both right now, unfortunately, but really the consumer I would say is unfortunately bearing the brunt of this because of inflation, right. And look my prediction if I can hearken to the Rocky movies, unfortunately Clubber Lang. My prediction pain, more pain. Unfortunately, and I know there's nothing funny about what people are suffering out there, but sometimes if we couldn't laugh, we cry.
But right now, Americans, particularly middle and lower-income Americans are absolutely struggling and the only way Peter that they have so far dealt with this surge in prices, let's face it is through increased credit card borrowing and credit card issuing, something that I've talked about a lot on this show that I've shown in my chalk talks. Credit card origination from subprime borrowers has absolutely sored. So, in other words so far, the only way middle and lower-income folks have been able to deal with the Biden inflation surge is through borrowing but borrowing at an extremely high interest rates, and we know that that game only last so long as inflation continues to accelerate.
Here's what's so dangerous to me Peter, you know this better than anybody has an economist. It's not just the rate of change. It's the rate of change of the rate of change. Meaning, in other words we're going downhill, economically speaking, and we're putting the gas on. Things are bad, and things are getting worse, the acceleration of the acceleration to the downside. That is, what is so troubling right now is that all the trends, all the metrics, all the economic data, tell us that things are bad and that they’re going to get demonstrably worse, and that is irrespective of Ukraine.
Now, listen, I am totally a proponent of an America First foreign policy of realism and restraint. I do not believe there is any vital national interest at all for the United States to insert itself into this very regional struggle in the Black Sea. But that is only worsening an existing crisis. If we take that off the table, which looks possible. Let's be honest right now as you reported properly in the opening.
We're getting good signs from both parties from Ukraine as well from Russia that they're making a lot of progress there, that would be wonderful. Wonderful to achieve peace would be great for the world. But that really would not remotely get the United States out of the economic quagmire that we are in irrespective of what's going on in Ukraine. And an economic crisis, a Biden inflation explosion that totally predated the very recent troubles in Ukraine. We’re not going to allow the Krugmans of the world. We're not going to allow Biden to use with Putin as a patsy for an economic disaster which has been caused, it is created crisis caused by the policies of Joe Biden.
Dr. Peter Navarro:
If we get peace in Ukraine, do you think we go back to the status quo Steve of relying on Russian oil and gas both here in the US and Europe? Or is this a wake-up call where we retool reboot the Trump oil and gas dominance energy dominance and shed that?
Steve Cortes:
Well is should sure better be for the United States, right. And I think it needs to become a foundational part of any candidate who is running in 2022 for election on the GOP side, is that we're going to return to Donald Trump's full spectrum energy dominance not even just independence, but energy dominance. This land is blessed with resources by the good Lord, and we need to fully utilize them. Again, we did four years, we know how to do it. We can get back to it relatively quickly, free up federal lands for drilling, enable pipelines, and allow fracking to again flourish in this country.
The Europeans though, different story there. I'm afraid no, are going to remain totally dependent upon Russian energy. But listen, that's not our choice to make that's theirs. And it's one of the reasons why by the way, if Ukraine is the problem that the left in America, and a lot of establishment Republicans, if it's the problem that they want us to believe it is, I don't buy that but let's just say for a second, it's that problematic. Guess what? It's not our problem, primarily. That is the problem of wealthy advanced nations in Western Europe, like, France, and Germany and Italy which are entirely dependent on Russian energy. That is their problem to figure out, unfortunately, for them, what they have allowed in the recent years is a bratty Swedish teenager to dictate their energy policies and their national security policies. We’ve allowed it a little bit in the United State but not to the degree that the Europeans have.
DONE
(Note to reader: I am not affiliated with Bannon’s War Room. I am merely transcribing so that people could copy and share.)