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Steve Cortes Blasts the Fed for Decimating the American Middle Class

Steve Cortes Blasts the Fed for Decimating the American Middle Class

Episode #50  |  August 26th, 2021

In This Episode:

On the eve of the Federal Reserve’s digital symposium, one former investor is slamming the Fed for its historically low rates and constant money printing.

In an interview with Trish Regan on the American Consequences podcast, former investment manager turned White House advisor turned television host Steve Cortes blasts the Federal Reserve for what he deems as “irresponsible” policy. 

Americans’ bottom-line reality is deteriorating, and inflation is robbing them of prosperity.

He spells out that what we need from the Fed right now is something resembling institutional bravery. Steve evokes the Paul Volcker-Ronald Reagan model from the early 80s, noting their politically dangerous move of raising interest rates, an initially unpopular but ultimately winning move for the American economy.

The two also discuss Biden’s dwindling poll-approval numbers, the politicization of the Pentagon, and the best macro-investing calls in this precarious moment.

Click here to listen now. 


Steve Cortes

Newsmax Host "Cortes & Pellegrino"
Serving in 2016 as a primary TV surrogate for the Trump presidential campaign and was named to Trump's Hispanic Advisory Council. Post-election, Cortes is a political commentator for CNN and heads Rise Strategies, a media messaging and public affairs company. Steve has worked on Wall Street as a trader and strategist and presently serves as head strategist for BGC Partners, providing risk management strategies to banks and hedge funds. Now, Cortes hosts the Newsmax show “Cortes & Pellegrino" with Jenn Pellegrino. 


Trish Regan:               Big shindig coming up in Jackson Hole. Heading into the weekend, the Feds going to be gathering there to make some pretty big decisions on the future of Federal Reserve policy. We’ll see if they manage to change anything.


                                    Hello everyone, welcome to this week’s edition of American Consequences With Trish Regan, and I am Trish. And you know I’m worried about inflation. I’m worried about inflation because we got the read on producer prices showing 7.8% of an increase in the amount that producers are paying for goods and services.


                                    So you know that’s going to trickle down to consumers by next month. We’ve already seen a 5.4% increase year over year for the last two months and what consumers are paying for goods. This is not sustainable. When you look at wage growth it’s coming around a paltry 1%. How can we, as a society, manage this? How can the middle class manage this, when you’ve got so much inflation and yet wages aren’t keeping up?


                                    Even if they were keeping up we don’t want inflation. That’s never good for an economy. We were talking just the other day – you can go back a couple of episodes, I encourage you to listen to David Eifrig. Doc, as he is known, Dr. David Eifrig and he and I were talking about this. He is a former Goldman Sachs banker. I actually went to Goldman Sachs as well. And a medical doctor… MBA… you name it.


                                    And he remembered talking about this, because how do you as an investor manage this? This is so critical right now. I mean I feel like you need to be in equities. You know, you need to be in equities until this bubble eventually bursts, which look it could happen.


                                    And that’s why this weekend is so important. We’ll watch for signals out of the Federal Reserve in terms of what their policies and what they’re going to do. But I’ve said you want to be in equities. I’ve said you want to be in real estate. Because these are assets that will appreciate. And of course, you want to be in commodities.


                                    And if you’ll listen to Doc, he’ll tell you, you got to be looking at gold as well. He thinks that gold is one of those things that really levels out a portfolio. He’s got a lot of ideas. I do encourage you to listen to all of his ideas, both on the podcast and you can head to Again that’s because he’s got a lot of ideas on how you need to be ready for this.


                                    And I do encourage people to be ready because we haven’t seen anything like this. I mean this is record-breaking, 7.8% of an increase in the prices that producers are paying for goods. That is an all-time record. And it comes on the heels of the PCE – which is another read on inflation – which was at a 30-year high.


                                    I mean, how much more can the American economy take at a time when they’re talking about additional lockdowns? They’re talking about possibly having vaccine passports for interstate travel. I mean, this is not going to be good for the U.S. economy, and it’s going to hurt your middle class.


                                    You’ve heard me talk before about this hourglass economy, right? With a lot on top and a lot on bottom because the Biden administration wants to help everybody on the bottom with free stuff. They just announced in the last couple of weeks the biggest increase to food stamps ever, a 25% increase. I guess they want to keep up with the inflation in food prices, right?


                                    You heard John Catsimatidis. He’s the CEO of Gristedes, which is a big, popular food market in the New York area, specifically New York City. And he has been very outspoken on this because he said you know what? You’re going to be looking at an 11 to 14% increase in grocery store prices for food on the shelves by this time next year.


                                    I mean how much more can the American public take? We’ve kind of reached a new low here in terms of how everybody is feeling. And it’s understandable because their money is not going as far. And when your money doesn’t go as far and you’re working really hard to make ends meet, and you can’t live the life that you lived just a couple of years ago, well that starts to really eat away at people’s confidence.


                                    And so I think some of it… the data that we’re looking at right now is having an effect on people’s feelings about the political situation. Obviously, the images that we’ve seen out of Afghanistan are also having a big effect on people. And so we’ll see. We’ll see whether or not ’22 or ’24 is going to bring a change or a shift, but I think America is kind of crying out for that.


                                    We need better strategy when it comes to our economy, which is what gets us back to the Federal Reserve and this weekend, right? Jerome Powell needs to figure out how to fight this. For some reason, they don’t think it’s important anymore. They think the only thing that matters is employment. You know what? It’s just transitory inflation, like it’ll go away. Heck, I hope it goes away. But I don’t think it’s going away.


                                    I think that once it sets in it’s very hard. It’s very hard to actually get this under control unless you raise rates – unless you want to take a page out of Paul Volcker’s book. And if he takes a page out of Paul Volcker’s book, what is that going to mean for the stock market? Right?


                                    This is why diversification is so important. This is why you need to head to You need to read and watch what Doc is saying about this. Go back and listen to the podcast. All of my podcasts and find what I do encourage you,


                                    Go to the website. Sign up, because I’m there and I’m writing every week for them. I’m the publisher of and we care about this stuff. We care about making sure that you are prepared in the right way for whatever is coming down the pike. And it’s a lot right now. It’s a lot to handle.


                                    I’m so happy to have with me here today my really good friend, the very smart former bond trader, I should point out, former head strategist for BGC Partners, who was in charge of providing risk management strategies for banks and hedge funds. I’ve known for many, many years.


                                    He’s been on many of my programs. On Bloomberg and CNBC and Fox. And he cares a lot about the bottom line here and making sure that America has a prosperous future, a prosperous future for the middle class. I am so thrilled to have with me the new host of Cortes & Pellegrino on Newsmax, every night at 9 p.m. Eastern. Make sure you tune in. None other than Mr. Steve Cortes. Steve, welcome.


Steve Cortes:               Hey Trish, thank you so much for having me.


Trish Regan:               So, OK. We’ve got the big shindig coming up in Jackson Hole, and there is some speculation that maybe, just maybe the Fed might actually pull back on its $120 billion a month bond purchases, which are artificially keeping rates so low on the 10-year Treasury. What do you think is going to happen?


Steve Cortes:               Listen, I think there is a reasonable chance that they do. It’s certainly what they should do Trish, because inflation is out of control in this country right now. You know, your audience certainly knows that from every time they go to the grocery store, every time they go to the gasoline station. They know that prices are rising dramatically.


                                    And the macro numbers certainly show that earlier this month. We got out the Producer Price Index, the PPI, at 7.8% at an annualized rate. That is the highest PPI ever since the index was reconstituted in 2010. And if we do sort of an apples-to-apples comparison, it’s probably the highest producer price increase since the early 1980s.


                                    Similar news on the consumer side – CPI was also off on 5.4% earlier this month of August, and from the July read. And that was the worst number for consumer prices since 2008. So we are setting really unfortunate records, some of which go back many decades.


                                    In many ways, we’re returning the United States to the 1970s. And I mean that Trish, in all the worst ways. I don’t mean disco and cool silk shirts. I mean inflationary terms, in terms of overseas quagmires in America.


Trish Regan:               I might beg to differ with you, by the way, on the style. I really think it was one of the worst decades on every front.


Steve Cortes:               It could be.


Trish Regan:               But Steve, you know, this is very interesting what’s happening. I’ve been looking sort of historically at what the Fed was doing, and if you recall, well it was probably before, well certainly before my time and I think certainly before yours. But nonetheless, back in 1965, the head, William Martin, the head of the Fed at that time, who had been there for five administrations, all of the sudden shifted gears.


                                    And in 1965, he made the calculated decision very similar to what Jerome Powell is doing right now, to care more about employment than he did inflation. And so if you fast forward the ramifications of that, eventually really, they were spelled out, right? In black and white in the 1970s because by the ’70s, you had mass inflation.


                                    And right now, we have a Federal Reserve that is making a choice to not care much about inflation and only care about employment. And I’m like but wait a second, you know, the employment, the unemployment rate is actually pretty low. So isn’t it time to care about things like the record-breaking 7.8% increase in producer prices and 5.4% increase in consumer prices?


Steve Cortes:               Yes Trish, I mean it absolutely is. And then and you’re so right because unfortunately, I think right now, the reality is the Fed has been totally politicized, and I really believe that. And I think then unfortunately, they are more interested I think in there is in two things.


                                    No. 1, just the sort of institutional power of the Fed itself, and they worry that they look like the bad guy, right? They’re the ones who start to pull the punchbowl away from the party because of inflation. But there will be ramifications for them, but for them institutionally politically.


                                    But then also in terms of politics, I really believe they’re trying to protect Joe Biden, and I really believe that is part of what is going on here, unfortunately. But should they be removing that punch bowl? Absolutely, and it was not because we don’t like to have the party, it’s because the party has turned into something onerous for most Americans.


                                    Their wage gains are not 5% or 7.8%. So this is crushing middle- and lower-income people. For, listen for really successful people inflation honestly is just kind of annoying. OK. The New York law partner or the investment banker who makes a lot of money, if the price of filling up his tank of his luxury SUV doubles, it’s annoying, but it doesn’t change his life.


                                    But to the single mom, working mother, waitress who drives far to get to her job, doubling the price of filling up her tank – that is crippling to her lifestyle. And that is what’s going on right now in America.


                                    And, you know, Trish I would also point out that inflation historically… when you throw inflation on top of a society that’s not entirely stable – and I would argue our society is not all that stable right now – when you throw inflation on top, the consequences historically are terrible when you look throughout the world at what inflation does.


                                    So inflation is an incredibly dangerous phenomenon. Something we haven’t dealt with in a generation in this country. We’re seeing it unfortunately just explode right now in the United States, and the Fed so far has been asleep at the wheel. Let’s hope that they change that in these coming days regarding their meetings in Jackson Hole.


Trish Regan:               Well I want to get into the politics of it. By the way, just to let everyone know they should follow you on Twitter. You have a wonderful Twitter account, @cortessteve, C-O-R-T-E-S Steve. You should watch his program. He is the host of his own show, Cortes & Pellegrino, on Newsmax every single weekday night, 9 p.m. Eastern.


                                    And one of the things I love about you Steve, and we’ve known each other a long time, is yes, you have a political viewpoint, but you also have an economic viewpoint. And I know I’ve talked to you during different administrations. Back during the Obama years, you had a lot of concerns about the Federal Reserve then. I know you had a lot of concerns about the Federal Reserve even during Trump.


                                    You’ve been very consistent on that, and now here we are with Jerome Powell, who I’m still perplexed by this because you know what? We actually, we’re coming out the other side of coronavirus, right? So why would you need to continue printing money?


                                    I realize they’re going to use it for all it’s worth, and maybe if you can convince people that they’re got to lock down again, you can get those $300 checks in the mail out for unemployment… or maybe another stimulus round or whatever it is that they’re looking for in terms of spending. I understand the politicization of what they’re doing with coronavirus.


                                    But then when it creeps into the Fed, I mean this is what really bothers me because, to me, the economy shouldn’t be politicized like this, Steve. What’s happened?


Steve Cortes:               Yeah, I know. It’s very unfortunate. And let me give you the other side of the coin. You know, in other words, leaders who did it right, because the last time we really did have inflation in the late 1970s, early into the early 1980s, we had Paul Volcker in charge of the Fed, and I think in many ways he is the antithesis of what we see with Jerome Powell.


                                    What I mean by that is he was a very brave and a very bold Fed chairman. He was also backed up by a president who was brave and bold at that time, Ronald Reagan. And they said we are going to crush inflation. Now it’s not without consequences, right? And by the way, people forget because Reagan was reelected so, practically unanimously in 1984 by such a large margin.


                                    But Ronald Regan was deeply unpopular in 1982 – even into 1983 if you look at his approval polls. And the main reason is because Paul Volcker was raising rates dramatically to fight the inflation that had been unleashed here by his predecessor Martin in the late ’60s that flowed all the way through the 1970s.


                                    And those two leaders, Volcker and Reagan, said we are going to crush inflation. They did so, and they did so at great, you know, near-term political cost. Ultimately, though, it was great not just for the economy but also great politically because, of course, Reagan soared in the reelection, had a magnificent second term for the most part, but particularly economically speaking.


                                    We need that kind of boldness and bravery now. We’re not seeing it, and neither will we see it – neither of the Fed nor certainly from the White House. But I believe that we are in a similar situation economically. And you’re so right… if the economy again shouldn’t be politicized because I don’t view this as a blue-or-red-state phenomenon.


                                    Inflation is affecting everybody. And again, it’s most harmful for middle- and lower-income people. They’re having a really hard time in America right now. I think the Fed needs to realize that.


Trish Regan:               Well look, I mean hey, if you’re invested in this market, you can’t go wrong. Right? Like it’s just been up, up, and away, but you have to think about the inflationary effect really on the market as well. I’ve said to people all along you want to be in equities. You just want to because you don’t fight the Fed.


                                    And at some point, the rug could come out from under. At some point, they make a decision that they need to pull back and Larry Summers has articulated this quite well. The danger is they overreact, right? And then you have the bubble effectively being pricked, which is going to be painful for everyone.


                                    But right now in this environment, you’re so right, it doesn’t matter. If you’ve got the money it’s a little annoying that you’re paying more for everything, but chances are you own your house, right? Or you have a mortgage on your house, so that’s sort of locked in. And the higher price at the gas tank just isn’t going to break the bank. It’s very hurtful for middle-class Americans.


                                    We’re talking with Steve Cortes. He’s the host of Cortes & Pellegrino on Newsmax at 9 p.m. Eastern. You can follow him on Twitter: @cortessteve.


                                    And let me ask you about Janet Yellen because Janet Yellen, I did not realize quite the extent to which Janet Yellen is so political. She is there now as Treasury secretary, but we knew her as head of the Fed. She really resisted, it seemed anyway. We knew she was a dove, but she kind of resisted going full in on all this government spending to prop up the economy, and now she’s all for it.


                                    How much pressure do you think is on Jerome Powell to keep his job with Janet Yellen there at the helm in Treasury?


Steve Cortes:               Oh listen, I think there is enormous pressure. I mean and look, I’m not going to let him off the hook at all, but I mean, I do understand it, right? These are people who all view themselves as part of the same club, right? When you look at the present leaders of the Fed and the alumni of the Fed, they have largely been educated at the same schools. They socialize together. I mean, there is enormous pressure for them to maintain the status quo.


                                    And again, also outside of the personal aspect, I really think that it’s hard to overemphasize how much Jerome Powell and others are interested in protecting sort of the institutional power of the Fed. And they’re worried that they will become very unpopular if they start to do what I believe is the right thing… which is to fight this inflation.


                                    And to your point, too, about people who already are successful, who already have a lot of assets, inflation is not a big deal to them and may even be helpful to them, quite honestly. If the aspirational crowd – and a lot of young people are by definition in that category – they are the ones being punished.


                                    For example, you mention housing. House prices are galloping higher and look, all asset prices are, but house prices in particular as institutional money for the first time in American history really starts to in a serious and systemic way invest in residential single-family housing in America, OK?


                                    Now they see the inflation is unfolding. They believe that’s going to be an asset class and will protect them. They’re making a very rational choice, but who is it really harming? The aspirational first-time homebuyer, who has simply priced out young people in the 20s or 30s, maybe newly married, maybe newly parents.


                                    Those folks are finding it nearly impossible – unless they’re at the very top of the income scale they’re finding it nearly impossible to buy homes, which has always been a critical and, you know, I would say foundational part of the American Dream. Now that American Dream is being pulled away from them, and people like Jerome Powell… people like Janet Yellen and Joe Biden… all of them need to realize those effects.


                                    So a rising stock market is great, sure. Most Americans don’t own a significant portion of stocks. Most Americans’ stocks are in their 401(k), they are for their retirement. They don’t help them day to day, most people. But things like housing prices, things like the gas pump, how much that costs, the grocery store, all of that is, absolutely every single day, kitchen table issues. That’s where inflation is so punishing to our country.


                                    Inflation right now… this is not Steve Cortes’ opinion or Trish Regan’s. The numbers show us inflation is out of control right now. I do not believe as Yellen and Powell want us to believe that it is “transitory”. That has become the most popular phrase in Washington, D.C. economic circles right now.


                                    I don’t think that word means what they think it means, if I can channel on the Princess Bride movie. And I do not believe it’s transitory. I think the numbers show that.


Trish Regan:               I was having this argument with someone the other day. I’m like how often do you really think prices go down? Right? Like when you go to your local restaurant and they go through the trouble of raising prices on the menu, do you think they’re really going to then print new menus to show you the $2 reduction in the entrée price? No.


                                    I mean, maybe they’ll give you a free appetizer, right? To kind of incentivize you to be there and make it more worthwhile. Or maybe at the movie theater, it’s very rare that I’ve never seen it where ticket prices would go down. I mean, maybe they’ll give you a free thing of popcorn.


                                    But Steve, once prices go up, it’s not as nimble as you think. I mean, maybe housing, you know, because housing prices will reflect that if there is some deflation. But in general, like prices go up and they kind of stay up for a lot of things. Again, not gas prices, not housing prices, but a lot of stuff that people need. It’s very rare that the prices come back down.


                                    And so the transitory thing, I mean even AOC, my gosh, I mean I hope you didn’t go to Boston University, because she went to Boston University, and she was an economics major apparently. And so I really just think that school did her a disservice. But she was talking about it as, well, being transitory.


                                    Look, I wish it was transitory. I mean, I’d love to be just blown away by the financial engineering here and think that they’re all just absolutely brilliant and they’ve figured this out more than anybody. But we all know the law of unattended consequences means that this is going to have some kind of spillover effect.


                                    I look right now at Jerome Powell. He seems to be wanting to keep everybody happy. Do you think that Lael Brainard there is waiting in the wings? Is who Yellen would really like to have the slot?


Steve Cortes:               You know, probably, right? I mean, although it’s certain Powell, I think, is basically doing what the Biden administration wants, so he is certainly not problematic, but they’d probably actually prefer Brainard. They’d prefer somebody – gosh, if they have a choice – who actually believes in a lot of monetary theory which is essentially just print money until you can’t print any more.


                                    And when I say “print,” I don’t mean necessarily physically anymore… and then in today’s age, it’s digital printing but that’s the unfortunate rally. But of course, there is a cost, right? There is no free lunch. You’re right, the price increases have a stickiness. I mean, that is an economic reality… that they rarely go down at the retail level.


                                    For most goods – you’re right that gas is an exception. For most goods, let’s face it, they just simply don’t go down. It’s just how much do they go up? How much is the rate of increase accelerate or decelerate in terms of price increases?


                                    And the reality is in the United States right now, though again it’s not my opinion. People know this from economic data, they know it from their personal lives. They know it from every time they check out at a store for goods that they really need. These are not all “want” goods, these are “need” goods. Things like food and energy.


                                    The price increases are out of control, and it’s not because demand is through the roof. Demand is doing well, but demand is not through the roof, and it’s because it’s an economic phenomenon where global capital, quite smartly, realizes we’re in an inflationary environment.


                                    And because that capital is pouring into assets that will be protected in a time of inflation, those assets mean a lot of commodities, for example. Stocks… houses… those are the things that can do well in an inflationary environment. And because of that, the price increases for regular consumers are frankly pretty staggering lately.


                                    This is a bad situation. It’s one that will squeeze particularly middle-class consumers who I believe were already in a pretty sour mood anyway. And by the way, terms of the mood, you know, we see this also in the national surveys. University of Michigan Consumer Sentiment – the preliminary read for August was released earlier this month.


                                    We’ll get the final read once August is done, but earlier this month, the release showed one of the biggest decreases ever to a 10-year low. Gave back all of the pandemic recovery gains. The University of Michigan index had gone from 71 at the lows of the 2020 lockdown, the spring lockdowns, and soared all the way above 80. And then it went all the way back down to 70. So broke that 71-low watermark from the spring lockdowns.


                                    And so, unfortunately we gave back all of the gains in consumer sentiment, and I believe most of that, most of what’s driving that worsening consumer mood – as reflected by the University of Michigan survey – is inflation. People realize, of course, that their bottom-line reality is deteriorating, and inflation is robbing them of prosperity and their wage gains are simply not keeping pace.


Trish Regan:               You know, I’ve seen it. I’ve seen it myself in my daily podcast as well, where people are really responding to this and they’re nervous about this. And it’s one of the biggest sort of discussion that’s going on right now. As much as people get absorbed in the politics of everything.


                                    And certainly what we’ve seen in Afghanistan is so devastating and that affects the mood of everyone. I think you’re right Steve, I really think that this is where it hurts, right? And let’s not forget, certainly, what 2016 was about, was people were hurting. And even back then Steve, it wasn’t necessarily inflation, but it was this sense that the rich were doing better and better under Barack Obama, and the middle class was getting squeezed.


                                    And again, back then, it wasn’t like it was, you know, proving out in the CPI data or the PPI data, but I know you and I had talked about it at length, and you really did feel like the middle class was getting gypped in part because I think wages never went up. Under the Trump administration, pre-coronavirus, they did actually for the first time. Median wages really started to significantly increase.


                                    And I credit the economic team with putting the right policies in place to help stimulate that. But I was looking back through the data and if you go back, Steve, to the early ’70s – actually right around the time we abandoned the gold standard – what you would actually see is that median incomes really started leveling out.


                                    And it used to be that the middle-class worker, especially manufacturing workers, would see their income rise with productivity gains. And in the early ’70s, that all changed. And so that the productivity gains were massive, but middle-class wages didn’t correspondingly move higher.


                                    And so now you couple in the fact that we’ve got inflation. I can’t remember the exact numbers. I think incomes are up about 1% in the latest read, but hey, if consumer prices are up 5.4%, that 1% gain in wages really doesn’t mean much. And so now we’ve got a situation that really feels like it’s spiraling out of control.


                                    And I know that Janet Yellen… she wants to help, theoretically, the middle class, right? Joe Biden has made that his platform, but it feels like their policies – economic policies have done anything but help the middle class. Your thoughts.


Steve Cortes:               Right. And you’re so right about the waking that we did see under Donald Trump before the CCP virus… 2019 was, in most respects, the best year for American workers in all of U.S. history. We had 6.8% median wage growth, the highest on record – even better than that for blue-collar workers… 9% wage growth for blue-collar workers. Above 7% wage growth for minority workers in America without inflation.


                                    It was just, you know, it was very restrained in place, you know, under 1% in the year. So we had an absolutely stellar economy in 2019. It was unfortunately totally unnaturally interrupted by the virus. But the point is we saw that the America First economic nationalist agenda was working, meaning smarter trade deals, tax cuts, incentivizing onshoring rather than off-shoring.


                                    We can get back to that. It’s not going to happen, obviously, with Joe Biden in charge, not going to happen with Pelosi and Schumer in charge of Capitol Hill. But we can get back there, and I think Republicans need to run in 2022, and then certainly in ’24 on that agenda of returning there. The highway through without inflation.


                                    And you’re so right. Right now, unfortunately, we have the inverse. We have very, very high inflation and we have tepid wage growth and I think that is a big part of, you know, and they mention what’s putting Americans in a very bad mood why consumer sentiment is so poor.


                                    I would also point out, by the way, that the consumer sentiment number that I mentioned from University of Michigan that was rallying before the Afghanistan debacle, so that’s not even counting that aspect. That was the first half of August.


                                    I suspect by the time we get to a final August read, given not just the economic problems the Americans are facing, but also the international crisis that we’re facing, particularly as it relates to Afghanistan, I believe that number will probably go head even lower. 


                                    Americans are in a very bad mood, and by the way, it’s reflected in Joe Biden’s poll numbers. You won’t hear this much from corporate media because they just lionize him, but if we look for example at the CNBC poll of approval of Joe Biden it was at 62% approval in February, an incredibly high number historically.


                                    By July, in just six months from Feb to July, it had crashed all the way to 48% – 14% decline in his approval rating per the CNBC poll. That is a massive move to have that quickly. And I suspect because of inflation that number is going to continue to slide.


                                    I think before very long, it’s going to test 40% in a downslide. And think I’ll tell you that he does not have – Joe Biden – that Donald Trump had… he does not have a core base that is incredibly enthusiastic about him. There is just simply, you know, again this is my opinion, but there are not sort of crazy Joe Biden fanatics, right? There is – really, it doesn’t exist, where Donald Trump certainly had that.


                                    And Trump, by the way – and I’ll be the first to say it – somebody who really supported him strenuously, you know, both campaigns, 2016 and 2020, worked for him, I’ll be the first to admit, but he had problematic polling. The one thing he could count on was there was somewhere in the area of 30% of America just rabidly supported him. I mean, just absolute fervid Trump fans.


                                    You don’t have that with Joe Biden, so I don’t know that he has a floor in terms of his polling, and I believe that it is inflation is not transitory, which I don’t believe it is. If it continues to remain sticky and problematic, as inflation numbers continue to be high Biden poll numbers, consumer sentiment numbers I think are going to continue to head lower and lower, if you can picture that. Sort of as a graph, I think it’ll form an X, I really believe.


                                    And then say it’s a problematic situation for our country, No. 1. That’s what I care most about, but it’s also problematic for Joe Biden.


Trish Regan:               You know, it’s so interesting you say that. You’re the second person now on this show in recent days to say that, and I encourage listeners to go back and listen to P.J. O’Rourke, who is the editor in chief of American Consequences and, of course, legendary satirist, journalist, and libertarian.


                                    And he made the exact same point a couple of weeks ago, saying “Look, Trish, he just doesn’t have the base support and that’s going to be problematic for him. And look, I don’t know, I assume he is going to run again in ’24 if he can. We’ll see. I mean I think as long as his eyes are open he will be trying to run as much as he said he hasn’t.


                                    And the Democrats need him because let’s face it, Kamala Harris is not going to be able to be electable. I think that’s quite evident, certainly in her debacle that she has put forward with the whole disaster at the border, etc. And likeability issues with the laughing off anything that is serious.


                                    And she has never been able to actually get any numbers anyway.  Just look at the New Hampshire poll in the New Hampshire primary and how disastrous that was.


                                    So if he were to run again, I actually think it’s sort of wide open, and we will turn a little political here, for the taking by the Republicans because people will want to get back to some – they want to get back to prosperity, right? That whole “Make America Great Again” movement, that’s still there. That’s still there, that base is still there.


                                    And regardless of whether Trump runs or not, somebody can come in and capture that spirit with the right economic agenda. That’ll be the possibility.


Steve Cortes:               No, I think it’s certainly there, and by the way, regarding Kamala Harris, her polling which is interesting is worse than Joe Biden’s. I mean Joe Biden’s has slid tremendously. He was a very popular president when he took office. I’ll be the first to concede that point, but that popularity has waned and it has waned very, very quickly. I mean by historical standards unbelievably quickly.


                                    But typically, vice presidents poll in terms of their approval – they tend to actually poll better than the president, and that kind of makes sense. They’re not as “out front.” They’re not taking the arrows the way that the president is typically. So most vice presidents poll better. She is polling significantly worse right now, Kamala Harris is.


                                    And you’re so right when you mentioned her inability to even get to the New Hampshire primary. Let’s remember her candidacy, although it was sort of ordained by the corporate media that she was the chosen one. She seemed to have the right mix. She was extremely progressive, from California, raised a tremendous amount of money, minority woman. Sort of checked all the boxes.


                                    Guess what? She could not make it to the Iowa caucus, she couldn’t make it to the New Hampshire primary. She was deeply unpopular, and by the way, she was deeply unpopular with Black Americans who are so important in the Democratic primary. They much preferred Joe Biden. They much preferred white guy Joe Biden to Kamala Harris in the primary in 2020.


                                    And I think that shows you just what an unpopular politician she is at a national level. I mean can she get elected in California? You know, obviously, she was a senator from there and my guess is she could win a California primary, but outside of California, I think she’d have an incredibly tough time.


                                    So who knows? It’s a ways off obviously to see who their candidate is, but on the Republican side, whether it’s Donald Trump or somebody else who subscribes to the America First agenda of American economic nationalism. What do I mean by that? Mainly I mean smartness in trade deals and prioritizing through policy, American production or American manufacturing, American onshoring, growing American wages.  


                                    That is going to be an agenda which I believe is not just good for America, but is also a politically winning formula. I mean I’ve been talking it about a lot on my show and writing about it in my editorials, and a lot of 2022 candidates are starting to talk about those issues.


                                    Let’s get back to a country where a family can live comfortably again on one income. That was the reality in this country. You mentioned before the early 1970s when that is when really wages started to not keep pace with economic growth and with productivities.


                                    Up until then, and into at least the early parts of the 1970s, a typical American family, a middle-class family could live on one income. And I’m not saying that just because I believe every mother has to be at home. No, I’m not saying that – or by the way, in some families, it may be the woman who makes the income, and that’s not, you know, for policy to decide.


                                    But the point is, families should have the option. They should have the option if they want, if they have children, to have a parent at home with those children and to be able to live reasonably and comfortably on one income. That is not the case for the vast majority of Americans today.


                                    And that is a change in this country. It’s not the way things used to be. I believe we can go back there, and when I say “go back,” I mean in the best way that we can go back to that reality with the right economic policies. And by the way, polling, we’ve been polling a lot during our conversation.


                                    Polling shows that the overwhelming majority of Americans want to have that option, including the overwhelming majority of women. And even if they choose to work we want it to be a choice for them, not a necessity where they literally can’t pay their bills unless they have two incomes.


                                    So these are the kinds of again, tangible kitchen table issues where I think policy can very much matter in people’s lives. But by the way, we’re certainly not going to get there with this current scheme of runaway inflation. I will tell you that because even two incomes can’t keep pace with the inflationary rates that we are seeing right now in the United States.


                                    And Jerome Powell needs to get serious about this. Janet Yellen does, Joe Biden, everybody who controls economic policy in this country needs to get real because middle-class people are being absolutely squeezed right now by inflation.


Trish Regan:               Got you. You know, you’re so right and it’s really depressing when you think about it. So it feels very ’70s-like, and I was just a little kid, but I remember the gas lines and I remember sort of the grainy television and the really bad styles. But it kind of feels like that because it’s sad. I feel like that American Dream, that prosperity is slipping away and sort of needlessly. Right?


                                    Because if you just were a little bit smarter about things, like if you were a little smarter on the withdrawal from Afghanistan, you know, maybe you wouldn’t have people being flung to their deaths from these airplanes as they’re gripping on.


                                    I would say this, you know that a lot of people are saying, “Well, Donald Trump wanted to get out.” Sure he wanted to get out, Steve, but he wanted to get out in the right way with the right sort of mechanisms in place. I mean we got out of Syria, and you didn’t see the disaster in Syria that you’re now seeing in Afghanistan.


                                    So there is a lot that could and should be done, and I’m sitting here going these people that are now running things think they’re too cool to school. They know how to do everything, and clearly, Steve, they don’t.


Steve Cortes:               No listen, there are institutional failures that are very significant in America. And you mentioned the completely botched withdrawal from Afghanistan. Of course, most of the responsibility has to flow to the commander in chief, to Joe Biden. But a lot of the responsibility also, frankly, has to go the generals of the Pentagon.


                                    And as much as those of us who are conservatives, as much as we respect and revere the military, quite properly so, right? The fighting men and women who risk their lives for our country. I think we also need to acknowledge the Pentagon leadership is inept and is totally politicized.


                                    The chairman of the joint chiefs of staff, General Milley, somebody who is supposed to be the tip of the spear, the top warrior of the top military in the world, we see him seemingly a lot more concerned with things like critical race theory and so-called “white rage” that he is planning with the effective withdrawal from Afghanistan.


                                    Or by the way, even maybe worse than that, as bad as that is, how about prosecuting the two-decadelong war correctly in Afghanistan? And not lying to the American people about our lack of progress. And I know “lying” is a harsh word, but I think it’s correct here.


                                    If we look at the Afghanistan papers, which was a great work of journalism by the Washington Post. It didn’t get very much attention because they came out right before the coronavirus hit the United States, so that story sort of got buried.


                                    But I don’t often praise the Washington Post, but they did enormously important work with the Afghanistan papers, which reveal through primary sources through a Pentagon report that was supposed to be confidential, which they sued to get made public, to get released to the American citizenry.


                                    We know that the Pentagon knew during two decades of war in Afghanistan just how terribly the war was going for the United States, and we know that they purposefully decided to deceive the American people. And it happened primarily over the administrations of George Bush and Barack Obama, and those White Houses participated as well.


                                    So I’m being bipartisan here in my criticism. This was a bipartisan failure, this war, and the ignoble exit from this disastrous war unfortunately and in a strange way and in a cruel way was almost fitting for the entire operation. But it gets to your point Trish, about I think that there is a crisis of credibility in America right now with a lot of institutions. As many of whom these institutions were once revered like the military.


Trish Regan:               Right. Like the Federal Reserve or the military.


Steve Cortes:               Exactly. I would throw the FBI in there as well. I think there are a number of institutions that were once revered, which have now sort of systemic problems in which the American people quite rightly don’t have confidence anymore.


Trish Regan:               Yeah, I feel bad for the country in that the politicians of yesteryear, right? Like I think back to what the Senate used to be, what Congress used to be, what all of these positions in institutions like the Federal Reserve or Department of Defense. It feels like everything has been so politicized in this environment because people so rabidly hated Trump that they didn’t really think through the policies that would be put in place under this administration.


                                    And they just kind of blindly followed the guy who is hiding in his basement the entire time while he was campaigning because he was, you know, they wanted to get away from Donald Trump and from the, you know. And consequently, now we’ve got this.


                                    So look, I think the pendulum always swings, right Steve? And so the pendulum – people are saying, “But wait a second, are we safe? Are we going to be able to take care of our families?” And these are sort of basic things that the government needs to be there to assist with. And if this government can’t, then it’s time to vote them out. Period.


                                    I do want to just give a plug again for your wonderful show, and one of the things I like so much about you, Steve, is you bring a lot of depth to what you’re talking about. I mean not just the political side of things, but the economic side of things and you have been in this field for so long, certainly as a trader and as a head strategist at BGC Partners. So I appreciate your angle on it.


                                    Before I let you go can you tell me what you would recommend investing-wise? I mean I’ve been saying you want to be in things like real estate. I think Jeremy Siegel came out and said that the other day. You want to be in equity markets right now. You probably want some of your portfolio in commodities, including gold.


                                    But do you have any ideas on what people might do to protect themselves?


Steve Cortes:               You know, Trish I think that I agree that real estate is going to continue to do very well. And for people who don’t want to actually tangibly own property, I think, reads real estate investment trust in terms of equities that reflect real estate are probably going to continue to do very well. I think they will benefit from an inflation environment, which unfortunately I don’t think is going away very soon.


                                    In terms of equities, I like equities that are commodity-focused. I do not like equities that are in any way China-focused. I think China is going to have a very, very difficult time in this inflationary environment. So those are my macro calls for now.


Trish Regan:               Not to mention that they could really pull the rug out from under, as we saw with the educational companies, right? Where they suddenly want to make them all nonprofit. I mean I think it’s kind of crazy to be invested in China for sure, because you just really don’t know what you’re getting.  


                                    So all in all, the U.S. is still looking like the best game in town from an investment perspective in your view?


Steve Cortes:               Yes, definitely.


Interviewer                  Well Steve, again I want to remind everybody to check out your show, 9 p.m. Eastern. Steve is the host, Cortes & Pellegrino on Newsmax. You can follow him on Twitter, @cortessteve. My thanks to you, sir. It’s always great talking to you.


Steve Cortes:               Hey, you bet. Thank you, Trish.


Trish Regan:               Steve made some really, really, really good points here, and I can’t emphasize enough what a precarious situation this is. We have not seen inflation numbers like this ever. Right, 7.8%, that was a record on PPI. And I sure hope, like Steve does that it’s transitory, but I have a feeling it’s not at all.


                                    And so you need to think about how you’re positioning yourself and your portfolio in this environment, which is why I want you to go to I want you to sign up there for our e-mail. And I want you to read everything that I am saying right now.


                                    Listen up, everyone. because we are in an environment where our U.S. dollar is effectively under attack here… and if we’re not thoughtful about our future, we’re going to run into major economic problems that will put a lot of Americans increasingly at even more of a disadvantage than we already have.


                                    So do make sure that you are subscribed to this podcast. You can also get my daily podcast, the Trish Regan Show. We’re talking about all of this right there as well every single day for you, and head to You can read about what Doc is saying there. I encourage you to listen to that last podcast and just buckle up, because we’re in for some very precarious times.


                                    I will see you right back here next week. We’ll see what the Fed really does.


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