Lumber prices will crash and Gas will get more expensive!

hey everybody economic ninja here we're going to be talking today about why i believe the cost of lumber is going to collapse in price and why i believe the price of gas is going to go soaring uh this summer so um this was brought to you by uh all of the great questions and comments that i get on this channel every day and we've seen a huge influx of people come on once i started covering the inflationary events around our country because they're searching for answers and rightfully so you should be searching for answers because you literally have a federal reserve that for years has been saying we don't have enough inflation we need to figure out interesting ways to ramp up inflation so it brought value to the dollar and we have uh insanely low interest rates which brings zero value to the dollar so we're going to talk about that um a few weeks ago i mentioned that i believe that lumber's going to collapse in price by mid-summer and i explained it why if you haven't seen that video i'll link it in the description below or actually uh i'll link it at the end of this video and you notice in there i said i i expect it to collapse by or one of these videos by mid summer to end of summer the reason why is because i believe that there's a point at which most people don't realize how supply and demand works and there is a point where demand wanes because whatever you're racing or you're scared that it's going to keep going up in value and you're trying to buy it because you either need it or you're afraid you're not going to get it the next day i don't care what it is you decide oh my gosh it's too expensive what the heck am i doing and you stop buying it now we're already seeing that uh if you just go off based off the comments in some of these videos everyone's saying i had a deck to build i had a shed to build i had a room addition to build i was going to remodel my home or i was going to build a home and now they're saying the heck with this why would i spend what is it 36 000 more to build in normal what 2 000 square foot three bedroom two bath house because of the price of lumber so we're already seeing that happening right now and on may 10th the futures price of lumber peaked at seventeen hundred and thirty three dollars right when i put up that first video lumber futures where i believe if i'm correct anywhere between 900 and 1200 dollars so it still didn't peak can it keep going up yes it can there can be a second mania all of a sudden builders start uh jumping on more lumber purchases because they think they've got a break because the facts are most people have no they suffer from normalcy bias they believe that whatever's happening today is going to happen forever and uh whatever you know comes in the future sort of smacks them in the face like it's a surprise i can't explain it um but i can take advantage of it and that's what i believe you guys all should be too because really patience is what makes a good investor patience the the slow the slow one wins the race when it comes to building wealth and being a part of a mania is never ever good if you're fomoing in then you're fudding out it's just it's just a fact you've got to take emotion away from this um so it says right here this this story just came out the other day um lumber futures were overvalued at last week's record high okay so now all of a sudden everything's changing right i still think there is some upside possibility says u.s lumber futures tumbled for a record high for the sixth straight session pushing some builders to the sidelines while they wait for even lower prices during north america's boom in home construction um it says the price of lumber for july deliveries has dropped 23 from its may 10th peak of 1733. 23 is pretty significant now the other day i just saw a story in the news where a home builder that was building a track of homes just canceled all of its contracts with all of its buyers and all that's sitting on these construction sites are the foundations the slabs are built because they can't source the material or they can and it's too expensive and now they're not going to make a profit you see there's always a certain profit margin that sits with building and i should know this i own a construction company with a handful of partners and i've been also in the remodeling game since the year 2001 and there's only a certain amount of margin right now a lot of people are signing this out of control hot uh real estate market where they hear you saying you know it's going for a hundred thousand we're asking that is so rare it's pathetic and yeah things are going for asking price and over but not that much over all right it's not what is being made out to be in the news and those pockets that are hot are just hot because they're small the market is super thin there's barely any uh inventory out on the market we've talked about that before the national associated station of real estate or sorry the national association of real estate uh has shown that over the last two years we've seen over 20 declines year over year in the available um homes for sale the properties for sale and this is nationwide okay so as inventory decreases you still have people that are afraid of missing out or they have to move and they're bidding up these properties okay but in the instance for this home builder we saw that they just went we're out we closed it and the whole news story was how this buyer was going well they should honor their they should honor their agreement but the contract clearly states that the builder can bail out because of a certain uh handful of certain issues and one of them being excessive price increases in materials or unability the inability to source those materials so they have all the legal right to do it all right um now when i say that lumber can pop back up just like this story says um some builders are sitting on the sidelines while they wait for even lower prices and when those lower prices happen just you know when a a a builder a con contractor or you know construction worker has a hammer well everything looks like a nail right well if you're in the business of building you don't make any money if you're not building right so i believe that you're going to see another mini mania in the lumber industry where uh lumber futures drop significantly these stores the home do-it stores and the lumber yards are able to replenish their stock right and then also there's gonna be another mad rush and it's just another mini panic i can't tell you how big it is but there is a point where it's gonna stop it's gonna run right back up we're gonna have the exact same issues and then we're gonna see the crash but this is why i think we're gonna see the crash in lumber we are already seeing amazing stress on the fuel side right so not only do we have literally terrorist attacks right a terrorist style attack happened on our country's infrastructure this being the colonial pipeline regardless of who was behind it it happened and it showed the weakness and how fast states will run out of gas now this is coming at the worst time literally in our country's history not only is it coming at the end of a pandemic pandemic when the entire country is starting to open up wake up get some money velocity moving in the country and a lot of people that have been pent up for a year want to go out and drink silver bullets on the beach honestly these are people are pent up and want to go party people want to hit the road they want to go the grand canyon and not only that it is literally at the exact moment that every year there's this mania that happens and that is in the fuel industry when people start right at memorial day and on fuel just starts to move and i believe and i'm already seeing it in the futures market as a matter of fact i've got it here let's see the futures market is not only moving up for um unleaded gas futures gasoline uh futures because at about let's see in january we're sitting about a dollar and a half and we're now at about two dollars and ten cents but what's impressive is the the volume of these future contracts are really picking up in the last two weeks and i believe they're going to continue to pick up i believe that we haven't seen anything yet in the fuel industry uh in the fuel prices and what i believe barring another event where a pipeline gets shut down or a couple refineries catch fire i believe what you're going to see is fuel prices get so expensive it's going to be a bigger event than what happened in 2008 when uh the average price of gasoline in our country hit four dollars and i believe 10 cents and you're going to see even if we get to that again or worse builders are going to stop building now not because of lumber it's because of costs of everything are going to go up because that's what happened in 2008 we started seeing prices all over uh raise and we started seeing all these added surcharges because of fuel we saw fuel surcharges everywhere in the economy and it brought prices up and right now with as much inflation as we're seeing right now and remember that a certain percentage of the country i believe it's 39 million americans are about to start getting 350 300 to 350 a month i believe it is per child as a supplement like a universal basic income so though that money is going to have to flow somewhere and i believe personally and i can be wrong this isn't financial advice not a financial advisor i'm an investor i'm trying to look at things very logically i believe that you're about to see that money push into real assets whether it be food fuel investments like silver gold bitcoin things like that because by then by july when these checks start flowing everyone's going to feel about three months of inflation pain everybody's about to become an expert in inflation and i think by then by the time the money starts flowing it's going to flow directly into real assets so i hope that makes sense to you guys um why i see this happening um [Music] i thank you guys so much for everything you're doing for this channel for me and for your family and friends by sharing these videos people have been put them on facebook they've been putting them everywhere and i'm very grateful for that because i'm trying to bring a level of of calm and rational thinking to the world right now because not only is this going to be gnarly it's going to be the greatest opportunities of your life to take advantage of this this is why bitcoin is going up this is why gold and silver are increasing in value this is why real estate's going up in value because the currencies are being devalued they're going down in value and so money is fleeing to safe havens and that's where your greatest opportunities are going to be and then on top of that once this happens we're doing videos on how to make money on the side all that kind of stuff but again i digress thank you so much for everything with this being said the economic ninja is out

Channel: The Economic Ninja

Views: 236,770

Rating: 4.9058022 out of 5

Keywords: bitcoin, bond, building a deck, colonial pipeline, deflation, diesel, economic ninja, eviction crisis, fuel, gas, gas prices, gregory mannarino, home prices, housing bubble, housing crash, housing crash in 2021, housing market 2021, housing market 2021 forecast, housing market crash, invest, lumber, lumber co, lumber prices, lumber prices 2021, money, mortgage crisis, mortgage forbearance, real estate, remodeled, stock market, the economic ninja, theta coin, theta token, xrp

Id: vexd1yx3BEI

Length: 11min 5sec (665 seconds)

Published: Tue May 18 2021