CPI increased 0.5% month-over-month in January…Following a 0.4% increase in December.

What does it mean – Inflation readings moved in the wrong direction for the Fed’s policy comfort, which will keep the market on edge about the Fed.

Inflation is not transitory…The FOMC minutes suggest the Fed will remain on hold as inflation persists.

What does it mean – The Fed is in no hurry to lower rates due to numbers from January and may even keep the Fed second guessing itself for the foreseeable future. Remember, the printing press is still working overtime.

Eggs…The cost is up nearly 10-fold in three years.

What does it mean – A dozen eggs now cost the average American $8.23 and over $9 in California according to the Epoch Times article. In 2022 the national average for a dozen eggs was $0.89 and in 2014 a dozen eggs cost $0.59. According to Jada Thompson, associate professor of agricultural economics and agribusiness at the University of Arkansas. Yet, according to Thompson, “by the beginning of February, the size of the egg-laying flock had dropped by about 7 percent compared with the number of birds in the field at the end of 2021.” While demand is up, and we lost 7% of the production due to the Bird Flu, we could see the “Fauci effect” take hold on our food supply as the very people in the FDA and NIH who are supposed to protect us rush to get patents on vaccines to vaccinate our food supply.

Yes, don’t worry, BIG PHARMA to the rescue. I will bet we are going to see an epic fight to vaccinate chickens, turkeys, and every other farm animal costing consumer and taxpayer untold trillions if big pharma gets its way. Better speak out. If the FDA and NIH are allowed to continue to be rewarded with fees from patents that they are supposed to oversee and if things don’t change in DC prepare for $20 a dozen. Not to mention, what will vaccinating our food supply really do to it? What will it do to our children and future generations to come? Eventually vaccines will be on the table and there will be nothing organic once those hit the food supply.

Retail sales declined 0.9% month-over-month in January…After an upwardly revised 0.7% increase (from 0.4%) in December retail sales falls.

What does it mean – While there was a notable pullback in spending on goods and services in January, one could chalk it up to the post-holiday hangover. It could just be a tired consumer after the holidays. But one has to ask, will that fatigue persist because of rising food prices due to the bird flu? Will the consumer hit the credit cards as folks start to plan what they will do once they get their tax refund.

Consumer delinquency rates are grinding higher…This is not good. As of the end of January we are getting back to near all-time highs for consumer delinquencies.

What does it mean – While peaking in 2010 and then again in 2021, we have seen 90-day delinquencies up nearly 40% over the last 24 months. Maybe folks should pay off their credit card with their tax refund.

If your government controls it, you can’t afford it…This chart is as clear as day. Everything the government touches drives the costs through the roof at rates far greater than inflation.

What does it mean – We need to downsize government back to the basics.

Per the chart below governments desire and insatiable appetite for power and control has put bureaucrats with little to no real-life experience in control of the rules and regulations that have destroyed major portions of our economy, our culture, our independence, and have dramatically destroyed competition and created oligarchies and in some cases, monopolies. Major industries are now controlled and structured through massive government regulation.

Per the chart above President Obama not only nationalized health care through Obama Care also known as the Affordable Care Act, which you can clearly see is unaffordable. In that same bill, the federal government largely nationalized the student loan industry in 2010 via a piece of legislation related to Obamacare, the “Health Care and Education Reconciliation Act of 2010.”

There is a reason Nacy Pelosi said, “we have to pass the bill so you can find out what’s in it.” You can come to your own conclusions.

This single piece of legislation is wreaking havoc on the health care industry and education system that was once the envy of the world and is now dictating your health care and our children’s future and our countries future through the backdoor as they mandate who gets accepted to universities, not on merit, but on indomitable characteristics like one’s sex or color of their skin.

As we look deeper into the above chart, over the last 50 years the government has instituted itself into the free market through massive regulations in every industry and that affects our economy. Through lending mandates dating back to the late 70’s and 80’s, it has caused housing prices to skyrocket.

The actual cost of money is exploding. One must ask what does it cost when a good borrower is forced to subsidies a bad borrower and the government gets between you and the lender, or in many parts of our economy, that relationship has been removed and makes the tax payer responsible for the bad loans. Not to mention, what happened to local banks? We have allowed the government to circumvent the free market. These policies are causing the real cost of education, healthcare, and housing to explode. Yes, interest rates are low but most of America can not afford the house they currently own today or the healthcare or insurance they are forced to buy.

What does it say about the federal government that changed the rules and nationalized the student loan industry under Obama in 2010 with the help of Congress. As we predicted, it drove up tuition at record levels and now most college graduates are not able to afford their student loan payment. Typical of academia and bureaucrats vying for more power and control. Disgusting.

SEIU admits it…Minimum wage increase in CA raised food prices and cost California over 10,700 jobs.

What does it mean – This study by the Berkley Research Group shows that California’s new $20/hour minimum wage for fast-food workers raised food prices and destroyed jobs.

Here are the key Findings from the Berkeley Research Group study:

• 10,700 Jobs Lost: According to U.S. Bureau of Labor Statistics (BLS) Quarterly Census of Employment and Wages data, California’s limited-service restaurant lost 10,700 jobs (-1.9%) between June 2023 and June 2024—marking the steepest decline this century outside of the Great Recession (2009) and the COVID-19 pandemic (2020).
• 14.5% Increase in Food Prices: Since the legislation mandating the $20 minimum wage for fast food workers was signed in September 2023, food prices at California’s local restaurants have increased by 14.5%—nearly double the national average (8.2%).
• Technology and Automation Replacing Workers to Offset Increased Labor Costs: Restaurants have accelerated the use of ordering kiosks, AI drive-thru systems, and robotic kitchen automation, reducing available entry-level jobs and shrinking employment per location.

Another great example of big government policy destroying business, jobs, and the ability for people to feed their families. It is driving more and more people to be more reliant on government welfare. When will the CA voter get a clue?

What DOGE it Matter?

The economic sirens of Homer’s Odyssey – The lure of the easy money and “free stuff for all”

When will the Republican (RINO’s and elites) in the Senate and Congress get a clue?

Republicans better get on board with their constituents or find themselves answering to voters in less than 2 years.

We are living in a world of temptation and instant satisfaction without any accountability or need for self-control. Watching DOGE at work and the economic impact this will have on our economy and wandering how we even got to this point reminded me of Homers Odyssey. Since our schools stopped reading the classic and rarely assign a book 100 years old, let’s go back and remember a classic from about 800 B.C.

Homer’s Odyssey…In Homers Odyssey, the story of Odysseus, a warrior who is returning home, to the island of Ithaca from the Trojan War depicts the lure of temptation and the importance of self-control.

What does it mean – Portrayed as beautiful women with bird-like features, the sirens are armed with amazing beauty and irresistible songs. They promised knowledge and pleasure without sacrifice. Their prey, fooled by the temptation of pleasure and lust for wealth and power, absent from hard work and moral courage to do what is right, the sirens lured their victims with instant gratification and envy that ultimately lead to destruction for those who hear their songs. Odysseus ordered his men to tie themselves to the boat and stuff their ears with wax to protect themselves from the lure of temptation…the Sirens.

Like Odysseus and his men, or more recently (about 90 years ago) the movie, Mr. Smith Goes to Washington. Like Odysseus and his men, the brave souls who get elected and go off to DC with all the right intentions fall to the Sirens temptation of greed, power, and wealth.

Now DOGE and what was known as RIGO during the Clinton administration, is and was a spotlight on waste, fraud, and abuse. And one word I would add to this to the list of words DOGE and RIGO were and now are commissioned to deal with – incompetence.

Over the last 30 days it is clear that the “Sirens of DC” have continued to wreak havoc on our elected officials and for some, they have fallen to the temptation of wealth and power. How is it that someone working in government all their life making on average $175,000 is worth over $20 million and in many cases far more?

The great news is DOGE and RIGO before it has figured out the game. The difference is that it is not Bill Clinton immediately firing 100,000 federal employees and nearly every judge appointed by his predecessor. Nor did it not stop Obama from talking a big game about the need to reduce government and make it more accountable.

In DC the Sirens lure of the sweet sound of free stuff fogs our vision, tempting the weak and stirring envy and jealousy. Our printing press runs constantly to cover up the blunders of incompetent and unaccountable bureaucrats and elected leaders

Transparency, accountability, competence and the rule of law matter. Like RIGO under Clinton DOGE matters. It is a giant spotlight illuminating the halls of congress and dark crevasses of government so that the people can see what is being done with their treasure and talents.

In the private sector, if a company had waste, fraud, and abuse like we have witnessed, it would be criminal, and people would go to jail. Yet, in government we have this impression that it is ok to squander, waste, lose, forget, and use the people’s money and treasure to benefit ones personal interest or agenda. And that is criminal.

In Davey Crockets biography, written by his friend Edward Ellis in 1884, he tells a story of a widow. One could say this story was the first to point out the hypocrisy of the swamp. In his famous speech on the floor of Congress he challenged both chambers and illuminated their duplicity for all to see. Many in DC still have not learned a thing and the Sirens of temptation continue to fog our elected and unelected leaders’ clarity between what is theirs to give and who it belongs to.

As Ellis tells the story, “The House was considering a bill for the relief of the widow of a distinguished naval officer. There was general agreement that this was a worthy cause, and everyone expected the bill to pass easily. But then Crockett rose and gave what he himself might have called a “sockdolager” of a speech.” Here is Davey Crockets speech.

Mr. Speaker—”I have as much respect for the memory of the deceased, and as much sympathy for the sufferings of the living, if suffering there be, as any man in this House, but we must not permit our respect for the dead or our sympathy for a part of the living to lead us into an act of injustice to the balance of the living. I will not go into an argument to prove that Congress has no power to appropriate this money as an act of charity. Every member upon this floor knows it. We have the right, as individuals, to give away as much of our own money as we please in charity; but as members of Congress we have no right so to appropriate a dollar of the public money. Some eloquent appeals have been made to us upon the ground that it is a debt due the deceased. Mr. Speaker, the deceased lived long after the close of the war; he was in office to the day of his death, and I have never heard that the government was in arrears to him. This government can owe no debts but for services rendered, and at a stipulated price. If it is a debt, how much is it? Has it been audited, and the amount due ascertained? If it is a debt, this is not the place to present it for payment, or to have its merits examined. If it is a debt, we owe more than we can ever hope to pay, for we owe the widow of every soldier who fought in the War of 1812 precisely the same amount. There is a woman in my neighborhood, the widow of as gallant a man as ever shouldered a musket. He fell in battle. She is as good in every respect as this lady, and is as poor. She is earning her daily bread by her daily labor; but if I were to introduce a bill to appropriate five or ten thousand dollars for her benefit, I should be laughed at, and my bill would not get five votes in this House. There are thousands of widows in the country just such as the one I have spoken of, but we never hear of any of these large debts to them. Sir, this is no debt. The government did not owe it to the deceased when he was alive; it could not contract it after he died. I do not wish to be rude, but I must be plain. Every man in this House knows it is not a debt. We cannot, without the grossest corruption, appropriate this money as the payment of a debt. We have not the semblance of authority to appropriate it as a charity. Mr. Speaker, I have said we have the right to give as much of our own money as we please. I am the poorest man on this floor. I cannot vote for this bill, but I will give one week’s pay to the object, and if every member of Congress will do the same, it will amount to more than the bill asks.”

Some things never change…In typical Washington fashion, not a single member gave a single dime to the widow and yet they were far too willing to give the people’s treasure.

Crocket went on to tell his Friend, “There is one thing now to which I will call your attention. You remember that I proposed to give a week’s pay. There are in that House many very wealthy men—men who think nothing of spending a week’s pay, or a dozen of them, for a dinner or a wine party when they have something to accomplish by it. Some of those same men made beautiful speeches upon the great debt of gratitude which the country owed the deceased—a debt which could not be paid by money—and the insignificance and worthlessness of money, particularly so insignificant a sum as $10,000, when weighed against the honor of the nation. Yet not one of them responded to my proposition. Money with them is nothing but trash when it is to come out of the people. But it is the one great thing for which most of them are striving, and many of them sacrifice honor, integrity, and justice to obtain it.”

Our nation has answered the call for Freedom throughout the world and our sacrifice to freedom and liberty is unmatched. Capitalism is the economic bedrock for which our economy runs on. Capitalism has created more wealth and freed more people than any other economic structure known to mankind. For nearly 250 years America has stood as a beacon for entrepreneurism and self-determination. While the Sirens of temptation may lure us all, it is our dedication to a moral and just system that puts the individual in control of their destiny to pursue their happiness protected by their inalienable rights.

John Adams famously reminds us that, “our constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.” “That morality and virtue are the foundation of our republic and necessary for free society.”

In Abraham Lincoln’s Gettysburg Address, he said, “that these dead shall not have died in vain– that this nation, under God, shall have a new birth of freedom and that government of the people, by the people, for the people, shall not perish from the earth” U.S. President Abraham Lincoln, The Gettysburg Address, November 19, 1863

DOGE matters because you matter. Your treasure and talent deserve the very best from yourself and from those we elect. We are the stewards for the next generations to come.

Let’s roll America!!!

Doug De Groote, CFP®, MBA, CTC
Managing Director

De Groote Financial Group, LLC is a federally registered investment adviser that maintains a principal office in the State of California. The information contained in this message is confidential, protected from disclosure and may be legally privileged. If the reader of this message is not the intended recipient or an employee or agent responsible for delivering this message to the intended recipient, you are hereby notified that any disclosure, distribution, copying, or any action taken or action omitted in reliance on it, is strictly prohibited and may be unlawful. If you have received this communication in error, please notify us immediately by replying to this message and destroy the material in its entirety, whether in electronic or hard copy format.