11-21-25 - 9am - Prices Since COVID

Episode Transcript

Speaker 1 (00:00):
Good morning from the highways of Eastern South Dakota. Well,
at least now we know all we need to know
about Jeffrey Epstein except what kind of doctor he is?
Is he like an obgyn or a brain search?

Speaker 2 (00:12):
And or what?

Speaker 1 (00:14):
Did everyone have a great day?

Speaker 2 (00:16):
I could insert a joke here about how he's an
obgyn doctor, but that might be inappropriate.

Speaker 3 (00:22):
Let's just move on. I got what you got.

Speaker 4 (00:24):
Since he was mentioned from eastern South Dakota. That reminded me.
I got an email earlier this morning, and we've been
talking about the map for quite some time.

Speaker 3 (00:34):
Have you finally ordered one?

Speaker 4 (00:36):
And a wonderful goober while we were still on the
other station, had sent one in afore it's correct, which
is on.

Speaker 3 (00:43):
Your desk right now. It's not exactly what we hoped
for for.

Speaker 4 (00:47):
A map, so Michael was going to order one of
his own, which he finally did. I did also get
just an email today, Hello Dragon, Please check your mail
room for a map sent to Michael and Dragon on KOA.
My regards or my records show it was delivered. I
have checked our normal landings.

Speaker 2 (01:07):
Don't you think that's it?

Speaker 4 (01:09):
This one? I can only assume it's probably a new one.
I'm not sure. There's no name attached to that.

Speaker 2 (01:15):
One, right, there was no name attached to it. And
the reason we can't use it or are not going
to use it is because it was a world map
and we're looking for well, I've ordered a US map
because we're wanting to put pushpins based.

Speaker 5 (01:30):
On the.

Speaker 2 (01:32):
Incredible streaming numbers we have from all across the country,
plus the three hundred and fifty stations that listen to
me on the weekend on the weekend with Michael Brown,
which you can hear from ten to one on Freedom
ninety three seven tomorrow starting at ten am. So we
wanted a map of a compilation of all of our
listeners from all over the country, and we were going
to hang that up either and here or out in

(01:53):
the hallway somewhere. We were going to put it up.
And we really do appreciate the goober that sent in
the one map. It just does not fit our purpose.

Speaker 4 (02:00):
The only reason I mentioned the email because I'm hoping, hoping.
It's probably not the right word, but I I if
it's another map that somebody has sent might to use,
we might be able to use it, but we haven't
found it. Yet if it is another map, just because
the way the mail system will work.

Speaker 2 (02:18):
Now, if you mailed us, here's how we could maybe
maybe confirm it. That as good as you know, say
a investigation into whether or not somebody falsified you know
the value of Marl logo or something, that kind of investigation.
You know, you put one number a new cares is
did you send us to the person that since sent email?

(02:38):
Did you send us a world map or did you
send us a US map?

Speaker 4 (02:42):
We need a little bit more information, Yeah, we need
a little When does it say it was delivered? Because
we did get the one did get one earlier in
the month.

Speaker 2 (02:49):
Right, And I assume that just showed up out there
on the.

Speaker 4 (02:54):
I saw some out here and I was like, oh hey,
I wonder what these are. And sure enough, I think
it had your name on ititor something, and I was like, yeah,
well let's see what.

Speaker 2 (03:03):
I remember the day we opened it on air, and
we were we were so disappointed that it didn't fit
exactly what we needed. So but we appreciate the effort.
The effort is phenomenal. I appreciate it absolutely. We're gonna
swerve into COVID and just COVID. Why are you talking
about COVID. COVID is over and done with real quick. Yes.

Speaker 4 (03:25):
Plus it was earlier in the month or late last
month where I got sick, Yeah, and I just my
voice was terrible.

Speaker 3 (03:31):
I was hacking up. It was terrible. Yeah.

Speaker 4 (03:35):
I go to the doctor and he, you know, tells
me I hits a laryngitis and bronchitis. And I just
I asked, was like COVID. He damn near busts up
laughing and goes, that's not a thing.

Speaker 2 (03:48):
It's not a thing, right, And he didn't even offer
to test for COVID because even if he tested for COVID,
even if it was COVID, does anybody care? Right, No,
We're back to the same spot where if you have
a cold and you're you know, snorting and sneezing and coughing,
do it into your sleeve, you know, do it in

(04:10):
your ill local, do it there, don't do it out
and spray everywhere, you know, And and quite frank, you
don't worry about the damn mask because the mask is
not going to stop a virus. A mask will stop
back teria, but will not stop a virus. I find
it freaking unbelievable. This is twenty twenty five and it's
still a thing. And it's still a thing because I

(04:32):
mentioned casually sometime earlier this week about how COVID and
the shutdown really did screw up things. And we're still
recovering from that. Until they believes me, and I know
you don't believe me, I'm going to prove you wrong. Today,
the Wall Street Journal is out with the story I
think this was I read it last night, but whether

(04:52):
stated yesterday or today, well, well it's been updated this
morning at eight fifty three am this morning, stern time,
and the headline is the middle class is buckling under
almost five years of persistent inflation. The subhead says, workers
growing tired of an economy in which everything seems to
get more expensive? Is that your experience? Is that what

(05:17):
you're dealing with? Three three one zero three keyword micro, Michael.
I really do want to this is I'm being serious now,
We're not just joking around. I really do want to
know from you whether or not you have a feeling
or you've got some you know, evidence, Like I just
went to the grocery store yesterday and I've always bought

(05:39):
x and X always costs you know whatever, and you
know when if you can remember back to COVID days,
tell me what it was you know, prior to COVID
and the shutdown, and what it costs you today, you know,
either post COVID or today and my post COVID, I
mean when we open back up, so say twenty twenty.

Speaker 3 (06:00):
Twenty three, twenty twenty four, whenever.

Speaker 2 (06:03):
I just want to see kind of a trend line
of whatever it is that you think is still stubborningly expensive,
because I think the Wall Street Journal is right about this.
The middle class is weary. They write, after nearly five
years of high prices, many middle class earners thought life
would be more affordable by Now there's that word again

(06:25):
that you just mark my words. This is going to
be a key word between now and the midterm elections,
of affordability. They say the costs for goods and services
are twenty five percent above where they were in twenty
twenty Thus COVID, even though they say the inflation rate

(06:46):
is below its recent twenty twenty two high. Certain essentials.
Now I agree that three two of these three things
are essentials. The first one I don't consider to be
an essential. I even tried to give some to Dragon
yesterday and he wouldn't take it. But they say certain
essentials like coffee, ground beef, and car repairs are up

(07:07):
markedly this year. I love the aroma of coffee, but
I just don't drink it. I've tried it every It's
like beer. I don't drink beer. I don't drink coffee.
Now you give me a really good tequila or a
really good McDonald's diet coke, and now we're talking, baby,
We're talking real stuff now. Holly Frew, who is a
college communications director. Her household income is about one hundred

(07:30):
and thirty five thousand dollars. She lives in Atlanta. She
says life felt more doable a year and a half ago.
I need to know where the light is at the
end of the tunnel. Pew says that they define the
middle class broadly. The middle class, according to Pew Research Center,
is a household income between sixty six thousand and two

(07:51):
hundred thousand, and technically day sixty six thousand, six hundred
and sixty six dollars, but that would be a Satanic household.
So we won't do the six six cent. We'll just
do the sixty six thousand and two hundred thousand dollars,
and of course it's also dependent upon your geographical location.
The Wall Street Journal says perpetual sticker shock is making

(08:13):
many within this group feel worse about their own finances
in future of the country, they're hunting for bargains and
spending more carefully. I can tell you that, while I
feel fortunate that I have, you know, a very good income,
solid investments, everything else, I still find myself, as I'm
sure you do, watching out like, oh my gosh, you

(08:35):
know what, you go out to eat and you look
at something and you look at the menu, and I mean,
I hate. I'm not trying to say that I am
a cheap ass, but I am a cheap ass. You're
telling me you want to charge me x for a
plate of pasta. Yeah, I don't think so. You're not
that good of a restaurant and it's not going to

(08:56):
be that quality of you know, of a bolonnaise or
whatever it might be. And so I you know, I'll
look at something else. Desserts you want to charge me?
Why first licee of g skake Nanny ain't gonna happen.
I think we are all unless you're in that upper strata.
I think everybody, but even the people that I know
they're in the upper strata. The millionaires and millionaires that

(09:19):
I know also watch their p's and q's. So the
frugality of the middle class customer is becoming this recurrent
theme in corporate earnings reports. For example, the Wall Street
Journal gives wing Stop Weing Stop said that in their
earnings report that middle income diners have now joined lower

(09:41):
income diners in diting back purchases. Tarja is reporting slumping sales,
and they say in their earnings report the customers are
spending cautiously on the discretionary items such as home to care,
home to court, or apparel. Walmart posted strong sales as
cannsumers from all income groups flought to the retailer's value.

(10:06):
So now you're at Walmart and you're shopping with the
people who are barely scraping by. You're shopping with middle income,
middle class shoppers, and you're probably shopping along with, you know,
people from the hoity toity neighborhood that are just like
you know, I just refuse to pay those outrageous prices.
So I'm going to go you know I'm gonna go
rub shoulders with the likes of Michael Brown at Walmartoo

(10:31):
University of Michigan and their Consumer Sentiment survey say that
forty four percent of middle income respondents say their financial
situation is worse than it was a year ago, twenty
three percent so that it was better. So I know
I'm piling on here in terms of requests for text messages.
But the other thing I'd like to know is whether
or not you feel that your financial situation is worse

(10:55):
than or better than it was a year ago now.
And I'm not going down I'm not going to go
down the political route yet. But if you're thinking that
I'm going down the political route, you may think that,
oh well, then you're going to blame Donald Trump for
the fact that people are feeling still stretched and that

(11:16):
even though inflation has moderated, it's moderated back to what's
we consider to be a normal inflationary rate somewhere between
two and three percent, yet prices remain stubbornly high. So
that reason of the question, then why are we this point?
What's going on that causes it to be like this?

(11:39):
I think you can make a very compelling case that
the economic disruptions caused by the COVID nineteen shutdowns, the
SARS COVID two shutdowns are still affecting price levels even
as the inflation rates moderate. And I think that's the
conundrum that we're all facing and we can't quite figure
out an I pose it that it's because the COVID

(12:03):
shutdowns were so draconian. It still just it truly just
pisces me off that we so you know, willingly fell
for the fear factor, that oh my gosh, this cyrus
is just let me kill everybody. We got everybody showing up.
You know, nobody had flu that year. You know, for
those almost two years, nobody had the flu, but everybody
had the COVID. Everybody had the COVID. And then we

(12:28):
took sick people. Now I want you to think about this.
We took sick people. Whether you want to call it
COVID or anything else. I don't care call it flu,
call it COVID. That people had a viral infection. And
so we took people who had a viral infection and
we put them in nursing homes like with Andrew Clomo
in New York, or we set up all of these

(12:50):
massive mash hospitals like Jared Police spend, you know, hundreds
of millions of dollars to turn the Colorado Convention Center
into a mash hospital, for which nobody showed up. And
then we did the real stupid things, you know, the
people wearing masks in cars, the people that weren't allowed
to go to you know, Malibu Beach and walk on
the beach with a fresh air, whereas you couldn't go

(13:10):
play in the park, you know, with the fresh air
in the sunlight and getting all the vitamin D. I mean,
it was insane. Oh you can't take the horse horse paste. No,
not the horse paste, the ivermectin tablets. But we were
let we were we were so inundated by the cabal
with fear that many people were and I always found
this ironic. Uh, you got to stay home unless you're

(13:33):
an essential employee. So we're gonna shut down the liquor stores.
So everybody you know, bitched about that. And then we
said we opened the liquor stores up because that was
essential because we needed to keep everybody you know, kind
of drunk and happy. But home Debot can stay open.
But if you own the clothing store or small retail
alley you could not stay open. Have you ever stopped
to think, I mean, now that we have the benefit

(13:54):
of hindsight, have you ever thought just how draconium, how
anti America, and how communist that was the picking of
winners and losers. And now we're still paying for it.
And that's my argument. The unprecedented shutdowns that were irrational,

(14:15):
triggered these deep and lasting economic shocks, and then they
get compounded by the historic government spending like the inflationary
the Inflation Reduction Act, and now both of those things,
the shutdowns and all of the absolute insane government spending
still continues to affect consumers and local businesses through persistent

(14:37):
high prices and what I'm going to call altered economic fundamentals.
We have altered some economic fundamentals and it's going to
take us a long time to recover from that. I
posted on X yesterday and by the way, if you're
not following me on X, you should be. It's at

(14:57):
Michael Brown, USA. And I just as I was thinking
about this story for today, the analogy of progressives, Marxist,
communist status whatever you want to call them, decades ago,
going back to the nineteen twenties and Woodrow Wilson started
a progressive movement which was a car wreck. And the

(15:19):
car wreck, you know, hit the ditch. It started to
flip and roll and roll and roll. But we were
all watching it in slow motion because indeed was happening
in slow motion, because that's how progressivism works. It slowly
starts to change things. And it rolled and it rolled,
and it rolled and accelerated. The rolling kept getting, you know,

(15:41):
so slowing down. It got faster and faster as we
moved through FDR and then Lyndon Baines Johnson and Barack Obama,
the rollover just became faster and faster. And then Trump
comes along and just stops it, and then it just
came to a complete halt.

Speaker 3 (15:57):
But the fundamentals remained.

Speaker 6 (16:00):
I go every time I go to the grocery store,
I muttered to myself, I can't afford to eat anymore.
Everything that I'm accustomed to buying, or was accustomed to
buying to eat now costs way too much for me
to afford because insurance has taken more out of my

(16:24):
social security, so I get less money to spend on food.

Speaker 2 (16:30):
And don't go to McDonald's Now I can't vouch for this.
I liken vouch the fact that Alexis sent us sent
it to us, but I can't vouch for the source
of the mean that she sent me, which has a
picture of Charles Pain from Fox News. But I'm not
really sure whether this is Charles Pain saying this or
this is the poster claiming this. But here's an example.

(16:53):
If this is true. McDonald's price has increased from twenty
nineteen to twenty twenty four. Medium French fries from a
dollar seventy nine to four dollars in nineteen cents. A
McChicken sandwich from a buck twenty nine to three eighty nine,
A Big Mac from three ninety nine to seven forty nine.

(17:19):
I look, I got a McDonald's. Can get a diet coke.
I don't order the sandwiches a big Mac three pieces
of bread, two little flimsy pieces of meat, and some
lettuce and sauce and whatever the magic crap is they
put on it.

Speaker 4 (17:35):
Two all beef patties, special sauce, lettuce, onions, pickles, all
in as sesame seed buns.

Speaker 2 (17:39):
That's it. That's it, how pathetic.

Speaker 4 (17:42):
It really is, because I do not eat it.

Speaker 2 (17:44):
McDonald's have done that is pathetic.

Speaker 4 (17:48):
Yeah, you need counseling. That's how catchy the song was
back then. Now, I mean, when's the last time they've
even done that commercial?

Speaker 2 (17:55):
All decades decades? But seven for that piece of crap,
that's almost eight bucks.

Speaker 4 (18:03):
I'll just go to like five guys or Smacks, And.

Speaker 2 (18:07):
I think that and I think guys, guys, guys buys,
five guys is relatively expensive. Yes, for hamburgers, I think
it's relative. You know, you can go to you know,
a chop house and spend about the same thing you
would spend at a five guy.

Speaker 3 (18:20):
Yeah, but you get a grocery cart worth of fries.

Speaker 2 (18:22):
And that's how they rationalize it, is just fill the
bag full of fries because they're They're cost per serving
is probably the same whether they fill the bag or
don't fill the bag. So what do they care? Seven
seven forty nine fuit okay? McNuggets. I think I lean
feed McNuggets to my dogs from four forty nine to

(18:43):
seven fifty eight. A cheeseburger which used to be a dollar.
Remember they had the dollar I remember the dollar menu.
You know you get certain things for just a dollar, like.

Speaker 3 (18:51):
You get the four nuggets, or you get one hamburger.

Speaker 2 (18:55):
Just the plain simple hamburger. Well, that was a dollar
is now three dollars and fifteen ens for the hamburger
and McDonald's. And we're not even talking about a quarter pounder.
Some of this is over two hundred percent increase in price.
This is not inflation. It's legalized robbery, which gets to
a One of the goobers who sent this is Guber

(19:18):
number eighty seven to seventeen, Mike Will. It is a
new normal. It is known we will pay it because
we need it, So why drop the price if they
can get that money from us? Well, I think some
of these retail places are beginning to realize that they
can get the money from us. When Target's earnings are down,
Walmart's is either stable or increasing, that means that they're

(19:41):
losing some of their markets share to Walmart. And they're
doing it based on pricing. So the whole price point
at which you're willing to buy something from Target versus oh,
I can get it for eighty five cents cheaper, or
a dollar twenty five cheaper, or whatever your price point is,
you can get it cheaper at Walmart. You're gonna shift
your shopping habits over the Walmart. And so now Target's

(20:03):
going to be put in a position because mainly, well
not mainly, but it is a publicly traded company, and
shareholders are going to be pissed off if they're going
to price themselves out of the market and start losing
market share. But I think what's happening is we're ignoring.
While we're all upset about the current prices, we are
ignoring that.

Speaker 3 (20:24):
Why Why?

Speaker 2 (20:27):
And I think it's because the shutdowns altered some economic fundamentals.
Let's think about the long term economic disruption. I think
we're still suffering through that. The COVID shutdowns cause massive
losses to the American economy. Estemate's placed GDP losses somewhere
between three point true two and four point eight trillion dollars,

(20:50):
that somewhere between fourteen and a half percent to over
twenty three percent of our gross domestic product. Just boom
disappears over a two year period, primarily because of mandatory
closures and just partial reopenings. Those interruptions then cause record unemployment.

(21:12):
The supply chain collapses, and a structural mismatch occurs between
the labor supply and the business demand that still to
this day is not fully recovered. And that disruption was
not just to this country. It was a global disruption,
meaning that our economy and our recovery was also challenged
by ongoing international supply chain bottlenecks and all the demand

(21:36):
shifts that took place. And then we had structural price
shifts and pandemic price stickiness, which gets back to that
text message. Food prices remain roughly twenty five to thirty
percent higher than pre pandemic levels, and certain categories like
food away from home that's up nearly thirty two percent

(21:57):
since twenty nineteen. Think of that, that's what the disruption caused.
And to your point to the goober, this says, yeah,
and now that's the new baseline. That's the economic disruption.
And even though many people can what we're doing is

(22:17):
we're putting more people into the category where they can't
afford that. But the people who can't afford it are
able to keep those certain companies in business, and so
they remain in business, operating on thinner margins, but at
some point it will collapse. Overall. Just generally speaking, consumer
prices have risen almost twenty four percent since December of

(22:41):
twenty nineteen, and that outpaces wage growth, and those higher
price levels have now become sticky. They stabilize rather than revert,
even though inflation rates are down. And I think that's
the key disconnect between what we're being told by all

(23:02):
the politicians and what you and I recognize at Tarja
or Walmart or Kingsopers or any other place, is that,
Oh wait a minute. I understand intellectually that the rate
of inflation has come down, but the prices have not.
And I know that the price of gas is coming down,
but that's going to take quite a while for those

(23:23):
price savings, those cost savings to make it way through
the entire supply chain to wherever that good is, that widget,
or that cucumber or whatever that you finally ended up buying,
for that to be reflected in the price of that
final product based on all the energy costs it took
to get that product to the point where you actually
buy it. And I think there's some key reasons for

(23:44):
the price stickiness. One of those key reasons.

Speaker 5 (23:47):
Michael Kennon, Sarasota, Florida, Big Mac four dollars to sixty
nine cents here quarter pound or with cheese four dollars
ninety nine cents, Medium price three dollars nineteen cents, six
chicken McNugget three dollars or forty nine cents, and then
the chicken meal, sandwich, fries, and drink five bucks.

Speaker 3 (24:06):
Nice to be living in Sarasota. Yeah that is for
housing costs.

Speaker 2 (24:09):
Yeah, well okay, right, see there's always a butt. There's
always a butt nearby. Is housing costs. I remind everybody,
if you want me to read your text message, the
text line is three three one zero three. It's not
that other number. I'm not even gonna say that other number.
And I'm sure I know it's five something, but I
don't know if I could say it. But if you
want me to read the other text, if you want
me to read your text messages, you've got to send

(24:31):
it to three three one zero three. It can't be
that difficult on your message app to put in a
new number that you can then save that says something
like you know Michael's text line, or you know for
you that hate me and you want to text dragon
Dragon's text line. But you can just save the number
and then just you know, when you are texting text

(24:55):
to me three three one zero three. You gotta say
Mike or Michael first, not even first, as anywhere in
anywhere in the thing.

Speaker 3 (25:03):
Has to be first. Are you sure about that.

Speaker 2 (25:06):
I think I've seen some with the out there or
maybe they're finally getting my messages about hey, we can
we stop the whole keyword thing. But I haven't got
any official notice of that, So still start with Mike
or Michael. So here's why I think we have to
continued stickiness on the prices. You get increased business operating
costs because of labor shortages and because of the wage

(25:28):
hikes that you know, trying to get workers back. Employers
started offering higher wages. And then we still had the
supply chain fragility and all the disruptions of manufacturing and
agriculture and logistics. Those all still exist too. Then you
had the whole recalibration of consumer behavior and all the
pent up demand that was driving continued high demand for

(25:50):
some goods and services. And we can't leave out the
role of government stimulus and government fiscal policy because the
COVID response brought with it this unprecedented and I can't
emphasize the word unprecedented. Federal spending spree enough trillions of

(26:12):
dollars aimed at direct relief, just money into the pockets
of people, enhanced unemployment, broad economic stabilization that injected in
amazing liquidity into the economy, fueling consumer demand and asset prices,
and that resulting surgeon demand outstripped the recovering supply, leading

(26:34):
to a classic inflation spike. And I quite frankly think
that even though the inflation rate has come down, we're
still recovering from it, and the stickiness of the prices.
Even though inflation rate has come down, the stickiness of
the prices is what we're still suffering from. And now
we get all the deficit driven stimulus, a couple with
the Federal Reserve's low rate and quantitative easing posture that

(26:55):
creates this feedback loop in price and wage expectations which
is going to take years to unwind. So while in
the short term, yes, you can claim that some prices
have stabilized, some prices like energy are starting to decline,
but the overall just general bascular goods that we would
buy for a CPI still remains high. So the economy

(27:19):
is still in a recovery phase. Wage growth, consumer confidence,
price stability are still adjusting to this post COVID baseline
that was shaped by the shutdowns and these stupid policy
responses that we allowed to take place, So price levels
are likely to reset to pre COVID norms are unlikely

(27:40):
to reset to pre COVID norms because of the structural
nature of those disruptions. So the new normal will include
higher baseline prices for a lot of categories, even if
inflation settles to historical averages. I think this evidence supports
the contention that ongoing price pain is no u solely

(28:01):
the result of recent inflation. I think it's a lingering
effect of the sizemy COVID shutdowns and the outsized fiscal
and monetary response or interventions that followed. That we don't
realize that when you just insert trillions of dollars into

(28:22):
people's pockets, that it takes a long time for that
to work its way out of the system. And we
now have a hangover, a hangover from COVID, not from Trump,
but from all of the stuff that Biden did, all
the stuff that the Democrats did, including some Republicans, and

(28:43):
the inflation reduction acts and all of the you know,
all of the response of you know, we're going to
throw money at everything is if somehow money was going
to make the stupid virus go away, it was insane.
And so it is a hangover, and it's more stubborn
than most post recession recoveries. And I think that's because
of the combination of everything I've just described, supply chain disruptions,

(29:07):
the stickiness all of the money that's still floating around
in the system, the money supply, and quite frankly, the
greediness or the fiduciary responsibility to their shareholders. Hey, look,
we're charging this for the mac, for the you know,

(29:28):
for the big mac, and we're still getting it and
people are still buying it. So what's the incidentive to
lower the price? None whatsoever.