'Work From Home' Could Soon Be Too Expensive

A first-hand report from Europe... 'Now you understand why the UK is collapsing'... 'Work from home' could soon be too expensive... Inflation thinking is entrenched... It's happening here... Your thoughts on student-loan forgiveness... [Stansberry Research Logo] Delivering World-Class Financial Research Since 1999 [Stansberry Digest] A first-hand report from Europe... 'Now you understand why the UK is collapsing'... 'Work from home' could soon be too expensive... Inflation thinking is entrenched... It's happening here... Your thoughts on student-loan forgiveness... --------------------------------------------------------------- We start today with a first-hand report from Europe... We wrote in Tuesday's Digest about [the growing energy and inflation crisis in Europe](. If you missed it, gas and electricity prices have been skyrocketing (again) on the continent. As we wrote... I still don't think many Americans fully realize the dire state of the energy crisis in Europe just yet. European governments are scrambling to fill storage facilities with natural gas to have enough fuel to keep homes warm... Because winter is coming... The potential knock-on effects of an energy shortage and a devasting recession could be long-lasting. Yesterday, paid-up subscriber Stephen I., who lives in the U.K., wrote in to share his first-hand account of the situation. I (Corey McLaughlin) want to feature the details because they paint a good picture of what everyday folks are already dealing with in Europe... Here our energy prices have already doubled since the start of this year to £150 [$176] per month. On 1st October they will double again to £300 [$353] per month. Then on 1st January they will increase again to £375 [$441] per month. This is because the UK government introduced something called a "price cap" – laughable I know. It amounts to a price control which as we know eliminates competition. Yet unlike a normal "cap" it doesn't keep prices down. This is because the government is too mean to fund a real price cap (it would cost £40bn – about 10% of what they squandered on the "pandemic"). Anyway, £300 is 15% of the average take home pay. Just for energy. Meanwhile the bank rate has gone from 0.10% at the end of last year to 1.7% now, moving mortgage rates from 1.63% to 3.75% (fixed-term rates are not so popular here) thus more than doubling monthly mortgage payments. Meanwhile inflation is still 10% and projected to go to at least 13% (some say 18%)!!! Of course this is all due to the "response" to the Covid "crisis" and compounded by the decision to cut off our biggest energy supplier (Russia) and the worst drought in Europe for 500 years... First, I want to thank Stephen for writing in and taking the time to share his view because, as he put it, "Now you understand why the UK is collapsing." Boots-on-the-ground reports from wherever you are reading, living, or working in the real world are always welcome. They help us all better understand what's really going, as painful as the truth can often be... Plus, by exploring these ideas, you can sometimes pick up on new trends, too (our discussions [on farming]( and [the trouble with railroads]( being two examples this year). And here is another you might not expect... Working from home might not be worth it anymore... A recent survey of 2,000 remote workers by the British price-comparison website MoneySuperMarket found that 14% of them are planning to spend more time working from their employers' offices to reduce their personal energy bills. The number increased to 23% among 18- to-24-year-olds, who presumably make less than older workers on balance... Now, I realize this means 77% of this group still aren't considering going into the office because of their higher energy bills at home. Frankly, it seems like a bit of a stretch that a significant number of people will make this change. For one thing, how many people are really going to do the math to figure the cheapest workspace option by weighing transportation and heating or lighting costs? Plus, for folks whose jobs allow it, working at home is a comfort and convenience for many people for a variety of reasons. But if you are being asked to use 15% less electricity – like folks already have been in countries like Germany and France – going to the office by default, even if you don't have to, might make sense. And U.K. officials have debated making the same request lately... The point is we've really come full circle in the past two years... The pandemic led to more people working from home and plummeting energy costs. (Remember [negative $35-per-barrel oil]( and tankers and storage facilities filled to the brim?) And then massive government stimulus contributed to inflation... Now, inflation – and a major war and an energy shortage – might cause Europeans who've been working in leisurewear to return to the office. Suddenly, plugging your computer and monitor in someone else's outlet for eight hours a day may sound much better, or be required if planned blackouts happen as expected in Europe this winter. Around one in seven working adults in the U.K. work from home, according to government statistics. The predetermined energy bill hikes that are coming in October and January, as Stephen noted, could increase the number of workers that turn the lights out at home... Of course, each person will do what makes sense to them (or their employer), or likely take the path of least resistance. In all, there are too many tradeoffs to consider to add up a potential economic impact of this dynamic in one Digest... The bigger point, though, is inflation is now a part of regular people's everyday thinking... It's definitely the case in Europe. And as inflation thinking is becoming more and more entrenched, we can expect to see increased stress, potential unrest in indirect ways, and a limit to economic growth broadly. These are long-term effects and behaviors that will take years, or decades, to fade from people's minds... even if the "official" inflation numbers tick down over the next several months. Last month, 49% of people surveyed by the University of Michigan's long-running consumer research group blamed inflation for eroding their living standards, matching the survey's all-time high over the past 75 years. One of the biggest things I've learned while working at Stansberry Research is that trends can go on much longer than you might expect... including inflation. The fact that the cost of working from home is even worthy of a discussion is another example. If this doesn't convince you to make sure you have the essentials – like warmth and food – readily available, I'm not sure what will... If you think this can't happen here, it already is... Our NewsWire team published [a fascinating piece of research yesterday]( showing how many people are late paying their energy bills in the U.S... and how much they owe... According to the National Energy Assistance Directors Association, 1 in 6 American households (or over 20 million people) are late paying their rising utility bills... The sharp rise in energy prices since 2020 has resulted in an increase of billions of dollars' worth of overdue utility bills. As of June, total overdue utility balances reached $16 billion. This is double what the figure was at the end of 2019 – just before the start of the pandemic... Since the start of the pandemic, electricity costs – as measured by the consumer price index – have exponentially increased... In July, consumers paid 15% more for electricity than they did a year earlier – the highest amount year over year since 2006. As of the end of 2021, roughly 40% of the electricity in the U.S. is generated by natural gas, according to the U.S. Energy Information Administration. The other 20% comes from coal, another 20% from renewable sources like wind and solar, and most of the remaining 20% is generated by nuclear power. With natural gas prices up 150% over the past year (coal is up about the same), people dealing with higher prices for food and housing costs simply can't keep up with the pass-through effects of the higher costs for utilities to produce electricity. California's PG&E said it has seen a 40% jump in the number of residential customers behind on payments since February 2020. And New Jersey's PSE&G said the number of customers who are at least 90 days late on payments has risen 30% since March. It makes sense... If you need to put rent or food on a credit card, what chance does the electricity bill have? Here's more from our NewsWire report... Normally, natural gas prices start to ease at the end of the summer. Producers are incentivized to store inventory before the high demand season of the colder winter months when houses need natural gas for heat. However, higher domestic exports have suppressed domestic supply. And severe heat-related weather patterns have caused a surge in electricity demand. The result: Prices have remained high this year and are advancing even higher. Did you catch that fine detail – higher domestic exports? We've noted the energy crisis in Europe. Countries are scrambling to fill their natural gas reserves as winter approaches without relying on Russian gas. A deep recession in Europe – and stickier inflation everywhere – will touch all parts of the world, of course... During the first four months of 2022, the U.S. exported 74% of its liquefied natural gas to Europe, compared with 34% the year before. And as of June, the U.S. had sent more gas to Europe than it did in all of 2021. Higher prices have encouraged shipping there... The investing takeaway... As Stansberry Research senior analyst Brett Eversole recently said in [a great analogy]( if the economy (which we're mostly talking about today) is a man, the stock market is a dog. When man and dog go on a walk, they don't often move in tandem. The man can have a steady gait and be headed one direction, and the dog can have its nose in a different direction, sniffing bushes or anything else that catches its sense of smell. They can move at different paces and have different goals, but man and dog are also usually connected by a leash... or by a tight bond developed through training that doesn't require a physical connection in open spaces... From an investing standpoint, the continued presence of real-world inflation reminds us again that shares of great companies with "pricing power" – companies which sell in-demand products that people will always want or need to buy – have a place in any long-term portfolio. The stock prices of these companies – like snack-maker Hershey (HSY) or certain health care leaders (like the kind our Dr. David Eifrig recently recommended) – tend to weather difficult financial conditions much better than trendy names, such as early pandemic darlings Zoom Video Communications (ZM) or Peloton Interactive (PTON). That has been the case lately... Look at the stocks of consumer staples companies. The Consumer Staples Select Sector SPDR Fund (XLP) – of which 50% is composed of shares of Procter & Gamble (PG), Coca-Cola (KO), PepsiCo (PEP), and Costco Wholesale (COST) – is up 6% over the past year... The Utilities Select Sector SPDR Fund (XLU) – which is heavily weighted toward electricity companies – is up 11% over the past year and roughly 14% in the past two months... The Energy Select Sector SPDR Fund (XLE) – which includes ExxonMobil (XOM), Chevron (CVX), and Warren Buffett's new favorite, Occidental Petroleum (OXY) – is up 70% from this time last year as oil prices have risen... The other eight of the 11 S&P 500 sectors are still negative over the past 12 months, with health care down the least at a 3% loss. This is a cherry-picking comparison, of course, but to finish the idea, Zoom's stock is down 75% in the past year and Peloton shares have lost 90% of their value. I remember a family member telling me two years ago, when people started working at home and figuring out how to do video chats, "I wish I'd bought Zoom stock. I'd be rich!" Now it's the opposite. We really have come full circle in the past two years when it comes to the stocks that are in favor. I still wouldn't say things are "back to normal" in general life, though... That ship has sailed. 'Don't Try Too Hard' In the latest episode of the Stansberry Investor Hour, Dan Ferris welcomes Brett Eversole, the lead analyst for Dr. Steve Sjuggerud's suite of publications, to the program for the first time... Among other things, Brett shares advice on how to work smarter – not harder. Plus, he offers a contrarian view on the tailspin in the housing market... and why reality today is far different from what most folks fear... [Click here]( to listen to this episode right now. And to catch all of the videos and podcasts from the Stansberry Research team, be sure to [visit our Stansberry Investor platform]( anytime. --------------------------------------------------------------- Recommended Links: [Huge Recession Loophole (See These Charts)]( Amid today's market turmoil, THIS is one of the biggest and most bullish opportunities today: a red-hot sector with almost unlimited pricing power and a history of outperforming in recessions. It's also the sector where our good friend Dr. David Eifrig spent half of his professional life, meaning he's extremely qualified to spot world-class opportunities today. [Take a look at the evidence here](. --------------------------------------------------------------- [Oil's New Inflection Point (Prepare NOW)]( It's a new turning point for oil that could drastically alter our economy this year. Goldman Sachs says it's the crux of its next 2022 play... and numerous top hedge funds have just changed their oil positions. [Click here for the full story](. --------------------------------------------------------------- New 52-week highs (as of 8/24/22): SPDR Bloomberg 1-3 Month T-Bill Fund (BIL), General Mills (GIS), Huntington Ingalls Industries (HII), Hershey (HSY), Cheniere Energy (LNG), and ShockWave Medical (SWAV). In today's mailbag, your thoughts on student-loan forgiveness and the start of the "debt jubilee" in earnest, which [we wrote about yesterday](... As always, send your comments, questions, praise, or rage to feedback@stansberryresearch.com. "When I was starting out in 1971, prices were going higher as well as gasoline, etc. I worked different jobs based on pay and potential of growth and pay. House prices were soaring and I did not ever think I could or would own a home. The administration in power was not trying to buy votes, like we are seeing today. "Saving as much as possible gave me the opportunity to buy a home – a small one. Then a few years later I could acquire a newer, nicer home. Mortgage rates (30-year) a few years later were 15%! Then we were blessed with children... "Well the millennials are facing the same financial environment as I did. So quit crying and do not be bought off by the government in charge. Work and live smart. It's not cool to spend all your money; look for a better job; and there are plenty of opportunities out there, just look for them (P.S., it won't come overnight). "Those of you that have been there as I have tell the kids!" – Paid-up subscriber Jeff H. "No loan forgiveness program can be enacted by Presidential order unless the existing statutes give the President express authority to do so. We'll soon hear the answer to that. Second, backfilling a $1.7 TRILLION hole with a Bobcat shovel while continuing to dig the hole deeper with a giant backhoe is like trying to bail the tide with a teaspoon. "It's utter insanity to continue this program in its same form. The program must be eliminated, or cut back to put severe limits on the maximum amount to be borrowed, with all borrowed funds to be paid directly to the schools, not to the borrower. "I could get behind a partial debt forgiveness program for borrowers who demonstrate they cannot pay their debt, similar to the IRS offer in compromise program, provided the program is reformed to keep it from getting out of control again. A single borrower making $100,000 or more can certainly afford to pay her debt off over a period of a few years and could not qualify for an IRS offer in compromise settlement... It's just monumental absurdity." – Paid-up subscriber Kelly F. "I can't believe that the government would allow such a 'Jubilee'. My three brothers and I all went through college with Student Loans. We ALL paid them back. I have two sons that went to college and their loans were ALL paid back. My Dad used to say that you don't borrow unless you know you can pay it back. "What is wrong with the world today??? Should all my brothers and sons get a 'rebate' because we were honest and frugal enough to pay back the loans?? Unbelievable!!!" – Stansberry Alliance member Joe G. "Household expenses have just dropped for thousands of debtors with student debt. If they were making ends meet before with student loan payments, where will they invest their extra dollars each month, stocks, options, or cryptocurrency?" – Paid-up subscriber Paul J. Corey McLaughlin comment: This thought crossed my mind too, Paul. My bet is any extra dollars will go to the same or similar places that people speculated with their stimulus checks... including "meme" stocks, options, and certain cryptos tied to nothing of potential long-term value. "I'm wondering if folks are so outraged that they have missed the Big Picture. This debt relief is unlikely to be a one-time thing. If the Congress doesn't challenge it (doubtful), it will happen again and again. Even if a different party comes into power, when the pendulum swings back, they will issue the relief again. "Add in ongoing deferred loan payments, repeat a few times and all of a sudden – it's FREE TUITION! Free College Tuition hidden in plain sight!" – Stansberry Alliance member Steve G. All the best, Corey McLaughlin Baltimore, Maryland August 25, 2022 --------------------------------------------------------------- Stansberry Research Top 10 Open Recommendations Top 10 highest-returning open positions across all Stansberry Research portfolios Stock Buy Date Return Publication Analyst MSFT Microsoft 11/11/10 990.5% Retirement Millionaire Doc ADP Automatic Data 10/09/08 897.0% Extreme Value Ferris MSFT Microsoft 02/10/12 852.1% Stansberry's Investment Advisory Porter ETH/USD Ethereum 02/21/20 583.6% Stansberry Innovations Report Wade HSY Hershey 12/07/07 556.4% Stansberry's Investment Advisory Porter BRK.B Berkshire Hathaway 04/01/09 420.4% Retirement Millionaire Doc AFG American Financial 10/12/12 418.0% Stansberry's Investment Advisory Porter WRB W.R. Berkley 03/16/12 369.4% Stansberry's Investment Advisory Porter NTLA Intellia Therapeutics 12/19/19 303.7% Stansberry Innovations Report Engel FSMEX Fidelity Sel Med 09/03/08 300.0% Retirement Millionaire Doc Please note: Securities appearing in the Top 10 are not necessarily recommended buys at current prices. The list reflects the best-performing positions currently in the model portfolio of any Stansberry Research publication. The buy date reflects when the editor recommended the investment in the listed publication, and the return shows its performance since that date. To learn if a security is still a recommended buy today, you must be a subscriber to that publication and refer to the most recent portfolio. --------------------------------------------------------------- Top 10 Totals 3 Retirement Millionaire Doc 1 Extreme Value Ferris 4 Stansberry's Investment Advisory Porter 2 Stansberry Innovations Report Engel/Wade --------------------------------------------------------------- Top 5 Crypto Capital Open Recommendations Top 5 highest-returning open positions in the Crypto Capital model portfolio Stock Buy Date Return Publication Analyst ETH/USD Ethereum 12/07/18 1,336.1% Crypto Capital Wade ONE-USD Harmony 12/16/19 1,185.9% Crypto Capital Wade POLY/USD Polymath 05/19/20 1,061.3% Crypto Capital Wade MATIC/USD Polygon 02/25/21 840.4% Crypto Capital Wade BTC/USD Bitcoin 11/27/18 468.7% Crypto Capital Wade Please note: Securities appearing in the Top 5 are not necessarily recommended buys at current prices. The list reflects the best-performing positions currently in the Crypto Capital model portfolio. The buy date reflects when the recommendation was made, and the return shows its performance since that date. To learn if it's still a recommended buy today, you must be a subscriber and refer to the most recent portfolio. --------------------------------------------------------------- Stansberry Research Hall of Fame Top 10 all-time, highest-returning closed positions across all Stansberry portfolios Investment Symbol Duration Gain Publication Analyst Nvidia^* NVDA 5.96 years 1,466% Venture Tech. Lashmet Band Protocol crypto 0.32 years 1,169% Crypto Capital Wade Terra crypto 0.41 years 1,164% Crypto Capital Wade Inovio Pharma.^ INO 1.01 years 1,139% Venture Tech. Lashmet Seabridge Gold^ SA 4.20 years 995% Sjug Conf. Sjuggerud Frontier crypto 0.08 years 978% Crypto Capital Wade Binance Coin crypto 1.78 years 963% Crypto Capital Wade Nvidia^* NVDA 4.12 years 777% Venture Tech. Lashmet Intellia Therapeutics NTLA 1.95 years 775% Amer. Moonshots Root Rite Aid 8.5% bond 4.97 years 773% True Income Williams ^ These gains occurred with a partial position in the respective stocks. * The two partial positions in Nvidia were part of a single recommendation. Editor Dave Lashmet closed the first leg of the position in November 2016 for a gain of about 108%. Then, he closed the second leg in July 2020 for a 777% return. And finally, in May 2022, he booked a 1,466% return on the final leg. Subscribers who followed his advice on Nvidia could've recorded a total weighted average gain of more than 600%. You have received this e-mail as part of your subscription to Stansberry Digest. If you no longer want to receive e-mails from Stansberry Digest [click here](. Published by Stansberry Research. You’re receiving this e-mail at {EMAIL}. Stansberry Research welcomes comments or suggestions at feedback@stansberryresearch.com. This address is for feedback only. 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