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- 🥳 Inflation Hits a 4-Year Low!
🥳 Inflation Hits a 4-Year Low!
& fear in the markets has disappeared.
Austin & Robert from Rich Habits
May 15, 2025
Together with Public
Happy Thursday,
We did it!
We survived the Trump tariff tantrum — the S&P 500 and the Nasdaq-100 are back in the green year-to-date (up +21% off their April-lows). This relief rally was further solidified by the Trump Administration sharing a press release alongside the Chinese government sharing a 90-day pause on the triple-digit reciprocal tariffs.
Additionally, the Trump Administration announced yesterday their $1.2 trillion deal with Qatar.
“Boeing and GE Aerospace secured a landmark order from Qatar Airways, a $96 billion agreement to acquire up to 210 American-made Boeing 787 Dreamliner and 777X aircraft powered by GE Aerospace engines. This is Boeing’s largest-ever widebody order and largest-ever 787 order. This historic agreement will support 154,000 U.S. jobs annually, totaling over 1 million jobs in the United States during the course of production and delivery of this deal.”
Keep the good news coming!
A quick breakdown — in case you don’t have the time.
⭐ Trial the Rich Habits Network for FREE for 7 Days (seriously)!
⭐ Walmart plans to pass on some tariff-related expenses to consumers.
⭐ We shared our five Summer “rich habits.”
⭐ Credit card delinquencies are hitting multi-decade highs.
⭐ The “fear index” just had a record-setting reversal.
⭐ UnitedHealth tanked after DOJ launched a criminal probe.
Market Overview
As of market open, 5/15/2025
Chart of the Week
Walmart plans to pass on some tariff-related expenses to consumers.
According to a Wall Street Journal article published this morning, Walmart plans to pass along some of their tariff-related expenses to their consumers. The company also decided not to share a profitability forecast with investors as they’re still navigating what they’ve dubbed “a dynamic and fluid environment.”
The chart above illustrates Walmart’s operating margin over the last decade. As you can see, for every $100 in sales Walmart generates only about $4 is left over to be realized as “profit.” From this 4% operating margin, the company then has to service their debt, reinvest into the business (employee raises, e-commerce infrastructure, etc.), and pay a dividend to their shareholders.
As tariff-related costs get passed to them from their suppliers, Walmart then has to make a decision to pass along a portion (or all) of that additional cost to their customers. According to the WSJ article, the cost of bananas has risen from $0.50 to $0.54 per pound, or about +8%, as their suppliers raise prices on them.
Walmart said more high-income households in the U.S. chose the retailer for groceries, and shoppers embraced its low-price store brand and “rollbacks,” or temporary deals.
This article comes two days after the Consumer Price Index (inflation) for the month of April was published — hitting a 4-year low at an annualized +2.3%. As you can see below, inflation hasn’t been this low since the beginning of 2021.
It’s going to be a very interesting summer.
On one side, we have mega-corporations sharing their plans to pass along tariff-related costs to their consumers (because they can’t afford not to with such thin margins) and on the other side we have consumer inflation hitting 4-year lows with Truflation data alluding to a sub-2% annualized inflation rate in May.
Will inflation heat back up as these costs are realized by consumers? Or will inflation continue to cool?
Regardless, we encourage everyone to take advantage of the volatility and continue to dollar cost average into the index funds and ETFs we talk about.
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In Case You Missed It…
In this week’s Monday-morning episode of the Rich Habits Podcast (linked here) — Austin and Robert shared their five favorite summer rich habits to help you reach financial freedom by fall.
Here’s what they talked about:
Track Your Summer Spending — Summer invites spontaneity — festivals, BBQs, beach days — and those costs add up fast. Instead of letting them derail your budget, track every event-related expense. Use tools like YNAB, Monarch, or even a simple spreadsheet. Awareness is the first step to staying in control of your money.
Set Specific Savings Goals — Avoid fall and winter financial stress by setting clear savings goals now. Weddings, football season, and holiday travel are all predictable — so start a sinking fund for each upcoming event. List out what you’ll need and break it into monthly savings targets. Bonus: keep your savings in a high-yield cash account to earn interest as you go.
Plan Your Fun on a Budget — You don’t need a luxury vacation to enjoy summer. Consider staycations, park picnics, free library events, or happy hour hangouts. Get creative and make fun affordable. The best memories often come from the simplest moments.
Monetize with a Side Hustle — Summer’s a great time to earn extra income — think dog walking, junk removal, or TikTok Shop. Got tech skills? Build simple automations for local businesses and charge a monthly fee. Even picking up a few weekend shifts at your local pizza shop could add hundreds to your bank account.
Review and Adjust Before Fall — As summer wraps up, review your progress. Use your extra savings to pay down debt, max out your Roth IRA, or start a down payment fund. Keep the momentum going into fall. Rich habits practiced now will pay off for years to come.
Listen to the episode and make sure to be realistic about your summer planning!
Here’s a link to the Q&A episode that was posted this morning.
We answered questions from: Juan, Brandon, Zach, Rudy, Jordan, Truett, & Shoosh
You can submit questions for these episodes by asking them inside of the Rich Habits Network, replying to this email, or sending us a DM on Instagram.
The Rich Habits Podcast is available on Spotify, Apple, iHeart, YouTube, and wherever else you get your content!
Robert’s Callout
Credit card delinquencies are hitting multi-decade highs.
As of Q1 2025, 16% of low-income Americans (ages 20–64) have credit card debt that’s 90+ days overdue — the highest rate in 22 years, per the St. Louis Fed. Even among the highest-income earners, 6% are seriously delinquent — the worst in 21 years.
Overall, 11% of Americans in this age group now have seriously delinquent credit card debt, and 12% are 30 days late — an all-time high. Financial distress is clearly rising across the board.
The share of people 30 days delinquent on their credit card debt has trended upward since the first half of 2021, and that trend was widespread among all four geographies examined by the Fed. Additionally, the trend is more notable in the lowest-income 10% of ZIP codes than it is in the highest-income 10% of ZIP codes. From the second quarter of 2021 to the first quarter of 2025, their delinquency rates grew by 63% and 44%, respectively, in relative terms.
Remember, you cannot out-invest high-interest debt. It’s more important than ever before to have a plan to get out of credit card debt! Consider a debt consolidation loan or a 0% intro APR balance transfer.
You can wander into debt, but you can’t wander your way out of it. You must make a plan and take action!
Austin’s Callout
The “fear index” just had a record-setting reversal.
We clearly weren’t kidding when we said that 2025 was going to be a VERY volatile year! Just three weeks ago, the Volatility Index skyrocketed and fear was everywhere in the markets. Today, trade deals are getting done, Trump is traveling the world soliciting US investments, and investors are feeling greedier than they’ve felt the entire year.
What’s my point in calling this out? It’s to remind you that DCA’ing is truly the best way to invest. It’s 100% impossible for you to predict how all of these market moves will unfold. We knew the market was reaching an inflection point, and we stuck to our consistent approach of adding to our winners and identifying undervalued positions.
This doesn’t mean we’re fully out of the woods though. The VIX very well could jump right back higher at a moment’s notice. Either way — you need to train your mind to be disciplined as an investor and don’t let emotions steer your investing.
Identify opportunities, continue to listen to the Rich Habits Podcast, and be a long-term investor. Volatility can drive you insane — please don’t let it!
Congrats to all of those that have tailed me on major winners this year like OSCR, GRND, HIMS, and more. I’m so excited to see what the summer brings for all of our investing journeys!
The Rich Habits Radar
👉 Container bookings from China to the U.S. jumped 50% this week.
👉 Warner Bros brought back the “HBO” name… again.
👉 UnitedHealth tanked after DOJ launched a criminal probe & CEO departed.
👉 April inflation cooled to +2.3%, while rate cut speculation continues.
👉 Saudi Arabia committed a record-breaking $600B to U.S. investments.
👉 Regulators prepped a major rollback of bank capital rules tied to the GFC.
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Disclaimer: This is not financial advice or a recommendation for any investment. The content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.