Billionaire investor Bill Ackman just issued a warning about the future of inflation. But don’t worry, it’s not all bad news, and you will see why during this video. For background, Ackman recently gave a rare, full length, sit down interview. While this interview touched on a wide range of topics, it was Ackman’s comments around inflation that really caught my attention. You are going to want to hear what he had to say. In this video, we are going to cover Ackman’s thoughts on the economy, why inflation is here to stay, and arguably most importantly, how you can protect your money from the devastating impacts of high inflation. Let’s get into it.
In order to prevent the US from slipping into deflation, the US federal reserve established a target annual inflation rate of 2% in the year 2012. For much of the next 8 years, the Fed struggled to get inflation up to that 2% target. As a result, many economists believed that inflation would never again be a problem in the United States. Oh boy how things can change and they definitely changed in a major way in 2020.
To understand why Ackman thinks inflation is here to stay, you have to understand why inflation occurs. In simple terms, inflation happens when the demand for goods or services outstrips supply. While that may sound like a complicated concept, trust me, it’s actually very simple. Here, we have a supply and demand graph. This line here represents the demand for a particular good or service
In this example, let’s say we are talking about used cars. The demand line represents the number of people looking to purchase a used car, and importantly, how much those buyers are willing and able to pay. Here, we have the supply line. This supply line represents the number of used cars available to be purchased at any given time. The point at which our two lines here cross represents the price for that good or service. So in our example, the average price of a used vehicle.
In 2020 and 2021, the US government and Federal reserve took drastic steps to prevent a widespread economic collapse. This involved sending cash directly to households, boosting unemployment benefits, and pausing required payments on certain types of debt. At the same time that all of this cash was getting pumped into the economy, the Federal reserve slashed interest rates to historically low levels. These lower interest rates made it less expensive for people and businesses to borrow money to make purchases.
Going back to our example with used cars, these actions resulted in an increase in demand for used cars. People had more money in their bank accounts to be able to spend to make the purchase. Additionally, the lower rates made it less expensive to purchase a car using a loan. These factors led to an increase in demand, illustrated by our demand line here getting pushed to the right
At the same time, automotive manufacturers were suffering through supply chain issues that limited their ability to produce new cars. Since there were less new cars available, people held on to their current car longer, resulting in less supply of used vehicles available for sale. Less supply means our supply line gets pushed to the left. Notice how now the two lines cross at a much higher price pointy
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I think this video is misleading. Inflation is when the government increases the supply of money or credit. It is purely a government created problem. To infer there is another cause is foolishness. Also, deflation is good because it means you have more money in your pocket to spend. By contrast the Fedral Reserve is telling a lie that 2% inflation is needed. Why would a person want to have the money in your pocket worth less. Let’s be honest, the Fed is trying to reduce the national debt with inflation. A stealth tax.
How dumb is the idea of having a goal of 2% inflation per year ,ten years is 20% every year that’s going to be on everyone’s mind ,oh I have to get a raise to ave. 2% a year ,dumb ,just not a good idea.
If you tax the people that work, and pay the people that don't, you'll have a society of people that don't work.
Social programs don't work.
He's a slave owner that wipes people's memories who served their countries in a fake operation so that they can steal from them. Why is he considered an legendary investor? For years his fledgling hedge fund was producing no returns and most importantly he had no purpose to continue. Rumors were circulating that he had no idea what to do with his life some said the end was near(For his investing career). He managed to hum some guys leg in the Trump administration and got lucky off someone else's work. He's a loser. He's now using the money he stole to donate to other shame organizations. Imagine the HUBRIS of going of TV when you talk about saving people from scams and then end up scamming others. Herbalife has nothing on the level of scamming Ackman does.
Puts on his big boy pants in the morning to talk about investing.
His stocks are not doing so great. Charts for LOW QSR SBUX HHH are recent losers. If there were an easy way to buy Universal Music Group I'd like it. It's on Amsterdam exchange. The rule I try to follow – just don't lose too much on any one stock.
The housing market is inflated and oversaturated with homes being on the market with astronomical price tags just stagnant for months. It is very clear that or generation will be likely one of the most devastating bubble pops in modern history. Seeking best possible ways to grow 250k into $1m+ and get a good house for retirement, I'm 48.
Very good explanation about royalties at the end. Didn't understand how it was beating inflation until you explained it will with RBI example. Thank you
Buy Stocks that are Growing earning FASTER than Inflation… GOLD /SILVER
I received advice to diversify my portfolio among various assets, including stocks and bonds, as a means to protect my inherited $2.5 million portfolio. While I typically prefer buying and holding assets, this strategy doesn't seem suitable for the current market, which feels like a rollercoaster ride. Additionally, I'm concerned about the impact of inflation on my portfolio and my financial security in retirement.
So inflation is not caused by the government printing trillions of new dollar bills and continuing deficit spending?
This is propaganda
Spelling error in the word interest.
So sick of listening to AI voices – not even gonna finish watching this video
SweetGreen
If world trade has so many supply lines and it crashes, then the more connected we are makes us that amount vulnerable for our investments and what we need to live.
In a just in time world, consider the ramifications of disruptions. How can the risk in any of it be measured.
He's a has been and lost big twice . Probably looked up to Ray Dalio
If you are properly prepared and have the necessary knowledge, every crisis/crash/inflation or recession offers equal market opportunities. I've seen people accumulate up to $800,000 during crises and even do so with ease in a terrible economy. No doubt someone has become enormously rich as a result of the crisis.
remember, this guy sucks. he went on news yelling “sky is falling” b4 covid lockdowns, w hidden short positions. netted him almost a billion in a week.
he just spearheaded harvard president resignation (she sucks too) over free speech & plagiarism. yet his wife’s phd thesis also plagiarized.
the 10M he donated to harvard to get such influence. wasn’t 10M. it was shares in a start up he had acquired. he gave it saying “if it drops in 5 yrs i’ll pay 50% cash to make it up. if it grows i get to decide where you spend the money”. he wrote it off immediately on taxes. and they sold it for 10M. come to find out 3 yrs later, company is worth 80M and has an IPO, now worth 100M. “ok i want u to spend the money here” “sorry sir we liquidated our position” now he’s suing them for 100M
Also shows the "MMT" people are BONKERS.
Concur, sniffy Joe Biden is the worst President in US history.
he bought huge JC Penny back at $40 right before it went tits up. Id take what he says with a grain of salt.
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very good video thAnks
With markets tumbling, inflation soaring, the Fed imposing large interest-rate hike, while treasury yields are rising rapidly—which means more red ink for portfolios this quarter. How can I profit from the current volatile market, I'm still at a crossroads deciding if to liquidate my $125k bond/stocck portfolio.
RAILROADS ARE DEFINITELY NOT ASSET LIGHT,WAY WORSE THEN AIRLINES.
Billionare tough guy Ackman threatens school kids
The market has been a turmoil since covid, the brief relief rallied for only a year and now the devastating effects of pumping trillions into the economy is here and will be for a while.
All three indexes have recorded declines in recent weeks, adding to the market's woes during the past month. I've heard of people getting up to 750K within a few months, and I want to know their strategies, so how can one benefit from the current market with an efficient entrance and exit strategy?
how did jcp penny work out idiot
The best way is find ultra wealthy ppl, unalive them, and suddenly you have access to a TON of capital!! 😊😊😊
Ackman is spot on but your analysis when you picked some "resilient" businesses is too shallow. For example, what happens to RBI when franchisees run into problems due to high interest rates and dropping real wages causing customers to tighten up their spending on overpriced fast food in order to pay more essential bills?
My primary concern is how to grow my reserve of $300k which has been sitting duck since forever with zero to no gains, sure I know the risks of short term gains are much greater but if well managed one'd make a killing, am I wrong?.
Sorry I can't handle the way you talk. I tried nothing personally but be more professional please
with the ongoing effects of high inflation, lower forecasted stock market returns, and stagnant wages, achieving a secure early retirement could be more challenging than ever before.
If you want your company run great , hire Howard graduates racist Bill ackman refused to hire
Investors are extremely alarmed by the impending recession and the Fed's rhetoric of raising interest rates. My $600,000 stock portfolio has lost 25% of it’s value. Whats the best way to hedge my portfolio to make profit in this recession.
Impressive video, I've been making passive income monthly from crypto for over a year tho' I prefer trading with the help of a professional broker Nora Hendrix because she saves me time and reduces the risk of losing funds in trading as we all know how volatile the market is.
Inflation has eased from 9% to 3.7% due to the Federal Reserve's interest rate hikes, but it's still well above their 2% target.The Fed recently paused rate hikes for a few months. My $270k portfolio is made up of 35 percent of falling stocks impacted by the uncertain economy. Still chasing after precautions to guard against this, but stuck for what to do?
could you please time stamp your video footage ?
Inflation, bank collapse, severe drought in the agricultural belt, recession, food shortages, diesel fuel and heating oil shortages, baby formula shortages, available automobile shortages and prices, the price of living place. <It's all coming together and it could lead to a real disaster towards the end of this year (or sooner). With inflation currently at about 6%, my primary concern is how to maximize my savings/retirement fund of about $300k which has been sitting duck since forever with zero to no gains.
I used to think every investor lose out during recession, meanwhile some make millions. I also thought everybody went out of business during the Great Depression, but some went into business. Bottom line, there's always depression for some, and profit for others, it all starts from having the right mindset. That said, I've set asides $250k to invest for future, unfortunately I'm a complete noob.
Why does she say "pricing powerrrrrrrrrr"? It sounds so ditzy. She would be better off learning an SRP accent.
The real problem is life after recession. People will never spend the same way. Economy will never be the same
Dam bill Ackman own the whole Us consumer market.
“This very unusual period of low interest rates”. I think he means when Donald Trump was President and the economy wasn’t a trash pit like now. Yeah. That period.
This is silly. Ackmam owns over 80 million shares of stock. There is no "how to get rich…" No. First, you be rich, and then you simply get richer. 80 million shares is physically impossible to achieve for anyone not already rich.