Look out: high food prices on the way


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GLENN: I want to talk to you something about the economy and what is coming, and it amazes me how no one is -- how others are starting to say the same thing now. Have you noticed that? Others are now starting to say exactly the same thing and no one is picking apart any of the facts. In fact, it's one of the things, we were just in a break and we were just having a conversation about the book Broke and Kevin brought a couple of guys in. One of them is a documentary filmmaker. And we were talking about, he said, what are people saying about the book? You know, what are the -- what are your critics saying? I said, I think this is the first book -- Stu, would you agree with this? This is the first book that we have done, you know, since, you know, Real America because nobody paid attention, nobody knew who we were. This is the first book that not one line of criticism or correction has been made. There's -- and there's no book that we have done that's full of more facts than this one.

STU: Yeah, that's true. I mean, I haven't seen anyone really, with any level of success, trying to pick it apart.

GLENN: Yeah, there's -- and I mean, it's 50 pages of fine print footnotes.

STU: Oh, yeah. I actually have it on my iPad.

PAT: IPad.

STU: And I was trying to find something near the end of the book. And I started at the end. I was at the end of the footnotes and I just started flipping. It took me like 20 minutes to get -- I just gave up after a while because you just kept flipping backwards through the --

GLENN: Overwhelming the system. It works again.

PAT: Every time.

GLENN: All of the footnotes toward the end are like, you know, Animaniacs, Episode Number 43.

STU: You are just making stuff up to fill -- make it look longer? Is that the plan?

PAT: Even know what that meant. The documentarian was pretty interesting. Did he say he went to Harvard? Because he said to us, it's like a third or fourth year Harvard textbook. That's how weighty it is.

STU: Again this is not the way to sell a book. You want to make it interesting, right?

GLENN: It is in one, in one regard: These are not --

PAT: It's meaty, weighty stuff.

STU: But it's entertaining, too.

PAT: Yeah.

GLENN: These are not the simple off-the-top of your head kind of answers. If you're looking for real meat, real answers, this is it. If you're looking for what's really going on in the country, this is it. It is the most comprehensive book that we have done and now there's some new stats, and the answers and the prediction of these things are in this book. This just came out from the -- what is the name of this thing? The National Inflation Association. They haven't given a timetable on this but what they're saying is with what the quantitative easing that has happened, what we're looking at now for prices, brace yourself. We went to two or three different experts yesterday and said -- because I was not going to put these on the air. I didn't bring these to you yesterday in the morning because we hadn't talked to the experts. And they kept coming back to me and going, no, it checked out. Go check with somebody else. No, it checked out.

This is what they're saying quantitative easing and the policies that we're doing, these prices will be seen in America. Brace yourself. For a loaf of wheat bread, one loaf of wheat bread, $23.05.

PAT: That's why I recommend white.

GLENN: Of course you do.

PAT: White bread, yep.

GLENN: Of course you do.

PAT: Cheaper.

GLENN: Problem with the brown bread again, don't you? Mr. Whitey

WHITE: Bread.

PAT: There's something about the white bread that's not healthy and it's not good for you. My wife always says, you know what? It just tastes better. It's fresher, it's squishier, it just tastes better on peanut butter and jelly sandwiches.

STU: Definitely squishier. The squishy factor is big.

PAT: It's better.

GLENN: No, you know what the squishy is? Chemicals.

PAT: I don't care. I tell my wife all the time, I don't care.

GLENN: I can't take white bread.

STU: You had to go white bread --

PAT: Seriously?

STU: Or you go seven grain?

PAT: Oh, that's really great.

STU: You've got to go one or the other.

GLENN: Seven grain. Seven grain.

STU: Wheat is in the middle. It's just this mediocre.

PAT: You might as well go out and scoop some sand off the beach and dump it in your gullet. Seven grain?

GLENN: Have we missed the point that any loaf of bread will be $23.05?

PAT: Oh. Was that the point? I thought the point was --

GLENN: For a bag of sugar -- now, I showed all of this in exactly the size. It wasn't a bag of sugar. It was just a little box of Domino sugar. They are saying that a box, regular box of domino sugar is $62.21.

PAT: What?

GLENN: Does anybody have any idea how much a box of sugar cost now at Domino's?

PAT: $2, $2.99, $2.98?

GLENN: Is it really?

PAT: I mean, well, it depends on how big it is.

GLENN: One of those --

PAT: Yeah, that's not very much.

GLENN: That's, what, a pound of sugar?

STU: A pound of sugar?

PAT: Two pounds is probably --

GLENN: Two pounds of sugar.

PAT: $3? I don't know, it can't be that much.

GLENN: $62.21.

PAT: Wow.

GLENN: Okay. You know the --

PAT: Wow.

GLENN: You know the coffee in the can but not the big can of Folgers, not the big can but the smaller can of coffee they're saying will now be $77.71.

PAT: Well, yeah, but that's the richest, most aromatic kind of coffee, you know?

GLENN: Well, yeah, I'm sure it's good to the last drop.

PAT: Well, yes.

PAT: And you better drink the last damn drop.

GLENN: $77.71.

PAT: Wow.

GLENN: These again are coming from the National Inflation Association. A 64-ounce jug of orange juice, $45.71. And this one I found the most amazing. I had to look at this, and I actually had to look at the chocolate bar on the air and off the air because I could not believe this one would be true. For a Hershey's milk chocolate bar, 1.55 ounces, that's one regular chocolate bar, $15.50.

PAT: And when do they predict these prices are going to begin?

GLENN: They don't give --

PAT: There's no timetable?

GLENN: There's no timetable for the prices, but they are making a prediction for these prices to be, quote, around the corner.

STU: I mean, yeah. Obviously at some point -- I mean, right now you can buy a 36-pack of Hershey's milk chocolate bars for 25 bucks on Amazon, 36. I mean, I don't know if that's the lowest price out there but it's a pretty good price. But now they are saying one chocolate bar?

GLENN: One chocolate bar. One 1.55-ounce chocolate bar, Hershey's chocolate, $15.

STU: What, the year 2700?

GLENN: No, no. I will tell you this. We have had our financial advisors, the guys who are stat-related guys, they are not politicians. They are more like the David Walkers of the world, you know, that they're just, all they do is look at stats. All they do is look at stats. And all of them are saying around the corner. All of them are saying starting in January you're going to see real price inflation. One of our experts, and I don't name them because they advise us off the air. They're not, they're just -- you know, quite honestly I think many of them don't want to be associated with me because they don't want all the trouble associated, and these are guys, again, it's not David Walker but it's somebody like David Walker who's just a bean guy, a bean counter. This is what they do for a living. And one of them said by next year a quarter of this nation will not be able to afford food. A quarter of the nation will not be able to afford food. I have to tell you, I'm never, ever right on timing. I have -- I'm not giving you my projection of timing. I'm telling you that there are these experts that say this. Is this true? I have no idea. I will tell you that historically speaking printing money leads to unbelievable inflation and gigantic interest rates. That's what happens. Period. So is it going to happen? At some point, yes. When? I don't know. I just ask you to please prepare.

Now, people have been writing me and saying, Glenn, what do we do? How do we prepare? I don't have any money. I understand. If you're living, if you're living, you know, paycheck to paycheck, I understand that. I'm asking you to get together with your husband or your wife and to look at every dollar you spend. And if you can save money and buy extra food and put it on the shelf, do so. If you can spend the extra money on having some food storage, if you are somebody who, you know, you've got grandkids now and you can't get the kids to listen to you and you have some extra money, buy it and put it on the shelf for them. Be a shelter for others. We could, in a year from now, two years from now, we could all laugh about this. We could say, remember when Glenn Beck said... and we'll laugh. And you'll have my permission. You'll have my permission. In 2012 if these things are not happening, you have my permission.

Experts are now telling me that it's happening next year. I don't know. I just know that prices of commodities have gone through the roof. I know that when I started telling you about gold, it was $700. When they were making fun of me and telling me that I was going to destroy people's lives because they were all going to go broke and you were just a hapless dupe when you were buying it at $1100 an ounce, today it is over $1400 an ounce. Could be worth $300 tomorrow. I don't know. But please look at the direction of --

PAT: I like how you say that, though, for the reverse psychology element. You tell them that so they will go ahead and buy it...

GLENN: Shhh.

PAT: And then when it does drop --

GLENN: Shhh.

PAT: Genius.

GLENN: Don't, don't point it -- nevermind.

PAT: Sorry.

GLENN: I forgot. Media Matters tells me our audience is so stupid, we can talk in front of them and it doesn't matter.

PAT: Oh, yeah. It doesn't matter.


 

Rapper Kendrick Lamar brings white fan onstage to sing with him, but here’s the catch

Matt Winkelmeyer/Getty Images for American Express

Rapper Kendrick Lamar asked a fan to come onstage and sing with him, only to condemn her when she failed to censor all of the song's frequent mentions of the “n-word" while singing along.

RELATED: You'll Never Guess Who Wrote the Racist Message Targeting Black Air Force Cadets

“I am so sorry," she apologized when Lamar pointed out that she needed to “bleep" that word. “I'm used to singing it like you wrote it." She was booed at by the crowd of people, many screaming “f*** you" after her mistake.

On Tuesday's show, Pat and Jeffy watched the clip and talked about some of the Twitter reactions.

“This is ridiculous," Pat said. “The situation with this word has become so ludicrous."

What happened?

MSNBC's Katy Tur didn't bother to hide her pro-gun control bias in an interview with Texas Attorney General Ken Paxton in the wake of the Santa Fe High School killings.

RELATED: Media Are Pushing Inflated '18 School Shootings' Statistic. Here Are the Facts.

What did she ask?

As Pat pointed out while sitting in for Glenn on today's show, Tur tried to “badger" Paxton into vowing that he would push for a magical fix that will make schools “100 percent safe." She found it “just wild" that the Texas attorney general couldn't promise that schools will ever be completely, totally safe.

“Can you promise kids in Texas today that they're safe to go to school?" Tur pressured Paxton.

“I don't think there's any way to say that we're ever 100 percent safe," the attorney general responded.

What solutions did the AG offer?

“We've got a long way to go," Paxton said. He listed potential solutions to improve school safety, including installing security officers and training administrators and teachers to carry a gun.

Pat's take:

“Unbelievable," Pat said on today's show. “Nobody can promise [100 percent safety]."

Every president from George Washington to Donald Trump has issued at least one executive order (with the exception of William Harrison who died just 31 days into his presidency) and yet the U.S. Constitution doesn't even mention executive orders. So how did the use of this legislative loophole become such an accepted part of the job? Well, we can thank Franklin Roosevelt for that.

Back at the chalkboard, Glenn Beck broke down the progression of the executive order over the years and discussed which US Presidents have been the “worst offenders."

RELATED: POWER GRAB: Here's how US presidents use 'moments of crisis' to override Constitutional law

“It's hard to judge our worst presidential overreachers on sheer numbers alone," said Glenn. “However, it's not a shock that FDR issued by far the most of any president."

Our first 15 presidents issued a combined total of 143. By comparison, Franklin D. Roosevelt issued 3721, more than twice the next runner up, Woodrow Wilson, at 1803.

“Next to FDR, no other president in our history attempted to reshape so much of American life by decree, until we get to this guy: President Obama," Glenn explained. “He didn't issue 3000, or even 1800; he did 276 executive orders, but it was the power of those orders. He instituted 560 major regulations classified by the Congressional Budget Office as having 'significant economic or social impacts.' That's 50 percent more regulations than George W. Bush's presidency — and remember, everybody thought he was a fascist."

President Obama blamed an obstructionist Congress for forcing him to bypass the legislative process. By executive order, President Obama decreed the U.S. join the Paris Climate Accord, DACA, the Clean Power Plan and transgender restrooms. He also authorized spying in US citizens through section 702 of FISA, used the IRS to target political opponents and ordered military action in Libya without Congressional permission.

All of these changes were accepted by the very people who now condemn President Trump for his use of executive orders — many of which were issued to annul President Obama's executive orders, just as President Obama annulled President Bush's executive orders when he took office … and therein lies the rub with executive orders.

“That's not the way it's supposed to work, nor would we ever want it to be," said Glenn. “We have to have the Constitution and laws need to originate in Congress."

Watch the video above to find out more.

Six months ago, I alerted readers to the very attractive benefits that the TreasuryDirect program offers to investors who are defensively sitting on cash right now.

Since then, those benefits have continued to improve. Substantially.

Back in November, by holding extremely conservative short-term (i.e., 6-months or less) Treasury bills, TreasuryDirect participants were receiving over 16x more in interest payments vs keeping their cash in a standard bank savings account.

Today, they're now receiving over 30 times more. Without having to worry about the risk of a bank "bail-in" or failure.

So if you're holding cash right now and NOT participating in the TreasuryDirect program, do yourself a favor and read on. If you're going to pass on this opportunity, at least make it an 'eyes-wide-open' decision.

Holding Cash (In Treasurys) Now Beats The Market

There are many prudent reasons to hold cash in today's dangerously overvalued financial markets, as we've frequently touted here at PeakProsperity.com.

Well, there's now one more good reason to add to the list: holding cash in short-term Treasurys is now meeting/beating the dividend returns offered by the stock market:

"Cash Is King" Again - 3-Month Bills Yield More Than Stocks (Zero Hedge)
'Reaching for yield' just got a lot easier...
For the first time since February 2008, three-month Treasury bills now have a yield advantage over the S&P; 500 dividend yield (and dramatically lower risk).
Investors can earn a guaranteed 1.90% by holding the 3-month bills or a risky 1.89% holding the S&P; 500...

The longest period of financial repression in history is coming to an end...

And it would appear TINA is dead as there is now an alternative.

And when you look at the total return (dividends + appreciation) of the market since the start of 2018, stocks have returned only marginally better than 3-month Treasurys. Plus, those scant few extra S&P; points have come with a LOT more risk.

Why take it under such dangerously overvalued conditions?

If You Can't Beat 'Em, Join 'Em

In my June report Less Than Zero: How The Fed Killed Saving, I explained how the Federal Reserve's policy of holding interest rates at record lows has decimated savers. Those who simply want to park money somewhere "safe" can't do so without losing money in real terms.

To drive this point home: back in November, the average interest rate being offered in a US bank savings account was an insutling 0.06%. Six months later, nothing has changed:

(Source

That's virtually the same as getting paid 0%. But it's actually worse than that, because once you take inflation into account, the real return on your savings is markedly negative.

And to really get your blood boiling, note that the Federal Reserve has rasied the federal funds rate it pays banks from 1.16% in November to 1.69% in April. Banks are now making nearly 50% more money on the excess reserves they park at the Fed -- but are they passing any of that free profit along to their depositors? No....

This is why knowing about the TreasuryDirect program is so important. It's a way for individual investors savvy enough to understand the game being played to bend some of its rules to their favor and limit the damage they suffer.

Below is an updated version (using today's rates) of my recap of TreasuryDirect, which enables you to get over 30x more interest on your cash savings than your bank will pay you, with lower risk.

TreasuryDirect

For those not already familiar with it, TreasuryDirect is a service offered by the United States Department of the Treasury that allows individual investors to purchase Treasury securities such as T-Bills, notes and bonds directly from the U.S. government.

You purchase these Treasury securities by linking a TreasuryDirect account to your personal bank account. Once linked, you use your cash savings to purchase T-bills, etc from the US Treasury. When the Treasury securities you've purchased mature or are sold, the proceeds are deposited back into your bank account.

So why buy Treasuries rather than keep your cash savings in a bank? Two main reasons:

  • Much higher return: T-Bills are currently offering an annualized return rate between 1.66-2.04%. Notes and bonds, depending on their duration, are currently offering between 2.6% - 3.1%
  • Extremely low risk: Your bank can change the interest rate on your savings account at any time -- with Treasury bills, your rate of return is locked in at purchase. Funds in a bank are subject to risks such as a bank bail-in or the insolvency of the FDIC depositor protection program -- while at TreasuryDirect, your funds are being held with the US Treasury, the institution with the lowest default risk in the country for reasons I'll explain more in a moment.

Let's look at a quick example. If you parked $100,000 in the average bank savings account for a full year, you would earn $60 in interest. Let's compare this to the current lowest-yielding TreasuryDirect option: continuously rolling that same $100,000 into 4-week T-Bills for a year:

  1. Day 1: Funds are transferred from your bank account to TreasuryDirect to purchase $100,000 face value of 4-week T-Bills at auction yielding 1.68%
  2. Day 28: the T-Bills mature and the Treasury holds the full $100,000 proceeds in your TreasuryDirect account. Since you've set up the auto-reinvestment option, TreasuryDirect then purchases another $100,000 face value of 4-week T-Bills at the next auction.
  3. Days 29-364: the process repeats every 4 weeks
  4. Day 365: assuming the average yield for T-Bills remained at 1.68%, you will have received $1,680 in interest in total throughout the year from the US Treasury.

$1,680 vs $60. That's a 27x difference in return.

And the comparison only improves if you decide to purchase longer duration (13-week or 26-week) bills instead of the 4-week ones:

Repeating the above example for a year using 13-week bills would yield $1,925. Using 26-week bills would yield $2,085. A lot better (34x better!) than $60.

Opportunity Cost & Default Risk

So what are the downsides to using TreasuryDirect? There aren't many.

The biggest one is opportunity cost. While your money is being held in a T-Bill, it's tied up at the US Treasury. If you suddenly need access to those funds, you have to wait until the bill matures.

But T-Bill durations are short. 4 weeks is not a lot of time to have to wait. (If you think the probability is high you may to need to pull money out of savings sooner than that, you shouldn't be considering the TreasuryDirect program.)

Other than that, TreasuryDirect offers an appealing reduction in risk.

If your bank suddenly closes due to a failure, any funds invested in TreasuryDirect are not in your bank account, so are not subject to being confiscated in a bail-in.

Instead, your money is held as a T-Bill, note or bond, which is essentially an obligation of the US Treasury to pay you in full for the face amount. The US Treasury is the single last entity in the country (and quite possibly, the world) that will ever default on its obligations. Why? Because Treasurys are the mechanism by which money is created in the US. Chapter 8 from The Crash Course explains:

As a result, to preserve its ability to print the money it needs to function, the US government will bring its full force and backing to bear in order to ensure confidence in the market for Treasurys.

Meaning: the US government won't squelch on paying you back the money you lent it. If required, it will just print the money it needs to repay you.

So, How To Get Started?

Usage of TreasuryDirect is quite low among investors today. Many are unaware of the program. Others simply haven't tried it out.

And let's be real: it's crazy that we live in a world where a 1.68-2.09% return now qualifies as an exceptionally high yield on savings. A lot of folks just can't get motivated to take action by rates that low. But that doesn't mean that they shouldn't -- money left on the table is money forfeited.

So, if you're interested in learning more about the TreasuryDirect program, start by visiting their website. Like everything operated by the government, it's pretty 'no frills'; but their FAQ page addresses investors' most common questions.

Before you decide whether or not to fund an account there, be sure to discuss the decision with your professional financial advisor to make sure it fits well with your personal financial situation and goals. (If you're having difficulty finding a good one, consider scheduling a free discussion with PeakProsperity.com's endorsed financial advisor -- who has considerable experience managing TreasuryDirect purchases for many of its clients).

In Part 2: A Primer On How To Use TreasuryDirect, we lay out the step-by-step process for opening, funding and transacting within a TreasuryDirect account. We've created it to be a helpful resource for those self-directed individuals potentially interested in increasing their return on their cash savings in this manner.

Yes, we savers are getting completely abused by our government's policies. So there's some poetic justice in using the government's own financing instruments to slightly lessen the sting of the whip.

Click here to read Part 2 of this report (free executive summary, enrollment required for full access)

NOTE: PeakProsperity.com does not have any business relationship with the TreasuryDirect program. Nor is anything in the article above to be taken as an offer of personal financial advice. As mentioned, discuss any decision to participate in TreasuryDirect with your professional financial advisor before taking action.