We Won’t Be Fooled Again – Inflation Is Most Definitely Not “Under Control” – Investment Watch

by Michael

Inflation is taking place!  Let’s all have fun!  All of us knew that when the Federal Reserve began aggressively climbing rates of interest it will have an effect on inflation.  Higher rates have caused a brand new housing crash, they’ve crushed the tech industry, they usually have sparked the largest wave of layoffs that we’ve seen because the Great Recession.  We’ve entered a big economic downturn, so it was inevitable that the annual rate of inflation would begin to moderate.  But as I’ll explain below, that doesn’t mean that inflation is now “under control”.  The actual rate of inflation is far higher than we’re being told, and folks all around the country are being absolutely crushed by the rising cost of living.

Let’s start with the excellent news first.  In keeping with the Labor Department, the annual rate of inflation is rising on the slowest pace since October 2021

Consumer prices increased 6.5% from a 12 months earlier, down from 7.1% in November and a 40-year high of 9.1% in June, based on the Labor Department’s consumer price index, a measurement of what people pay for goods and services, which labor released on Thursday.

The rise last month marks the slowest annual gain since October 2021 and matches economists’ estimates.

Okay, but Fox Business has just reminded us that the annual rate of inflation “stays about 3 times higher than the pre-pandemic average”

Still, inflation stays about 3 times higher than the pre-pandemic average, underscoring the persistent financial burden placed on tens of millions of U.S. households by high prices.

So we’re still definitely in a high inflation environment.

But let’s dig deeper.

Most Americans don’t realize that the best way that the inflation rate is calculated has literally been modified greater than two dozen times since 1980.

And each time it has been modified, the goal has been to make inflation look like lower than it actually is.

If the speed of inflation was still calculated the best way that it was back in 1980, the true rate of inflation could be close to fifteen percent straight away.

That might be comparable to the height inflation that we witnessed in the course of the Jimmy Carter era.

So don’t let anyone attempt to persuade you that inflation is “low” or “under control” or anything like that.

The primary reason why the speed of inflation moderated somewhat in the course of the month of December is because energy prices have been falling

Americans saw some real reprieve last month in the shape of lower energy costs, which fell 6.1% in December. Gas prices dropped 12.5% over the month, the largest contributor to the general headline decline in inflation in December.

That’s great news, but it surely is already being projected that gas prices will rise significantly later this 12 months.

And once war within the Middle East erupts, gas prices will go to heights that the majority people never even dreamed was possible.

Meanwhile, services inflation has just spiked to a level that we haven’t seen in a long time.

The fee of living has turn into extremely oppressive, and the American persons are becoming increasingly frustrated by this.

I would love to share a video with you that illustrates what I’m talking about.

The girl on this video doesn’t understand all the numbers that I actually have just shared in this text.  All she knows is that when she goes to the food market, prices are way higher than they once were.  This video incorporates some graphic language, and I apologize for that prematurely.  But I need you to see her anger, because that is how tens of millions upon tens of millions of Americans are feeling about inflation straight away.

Would you wish to be the one which tries to persuade her that inflation is “under control” now?

Sadly, the reality is that over the past few years the fee of living has been rising faster than our paychecks have, and so U.S. families have steadily been getting poorer

The typical American family has lost the equivalent of greater than a month’s salary in annual income since President Biden took office as high inflation and rising rates of interest eat away at their funds, based on research by the Heritage Foundation.

Experts on the conservative think tank analyzed consumer prices and rates of interest and located of their latest report released Thursday that the common American household has lost the equivalent of $7,400 in annual income since Biden’s inauguration Jan. 20, 2021. The income loss represents a rise of $200 from September, when the think tank’s research found a $7,200 decline in annual income for the common American household dating back to the beginning of Biden’s term.

Prior to the pandemic, we were in a low inflation and low rate of interest environment.

Now that the Federal Reserve has dramatically hiked rates of interest, we now find ourselves in a high inflation and high rate of interest environment.

And better rates of interest are also hammering our lifestyle

While their elected representatives in D.C. struggle to pay the nation’s bills, Americans are facing an analogous challenge as their household budgets are stretched thin attributable to inflation and better borrowing costs. Those financial challenges led greater than one-third of households to depend on bank cards or loans to purchase necessities in December. Average bank card rates of interest reached a brand new record high of 19.14% APR in comparison with a Bankrate.com database.

“Americans are increasingly counting on bank cards to make it from paycheck to paycheck, leading to higher levels of indebtedness. Rising bank card balances in an era of rising rates of interest is a path to insolvency,” Antoni told FOX Business. “The typical rate of interest on bank cards is now around 20 percent while half of Americans cannot repay their bank cards every month, and balances are growing at a 16 percent annual rate.”

We’re getting hit from each ends.

We’ve to pay more to purchase the things that we want, and we’ve to pay higher rates of interest once we borrow money to pay for those things.

The Federal Reserve has lost control, and we’re careening toward the kind of historic economic crisis that I actually have been warning about for years.

But those which are under the spell of the company media will proceed to assume that every thing is positive and that our leaders have a plan to get us out of this mess.

I really wish that was true.

Unfortunately, the short-term economic outlook is incredibly dismal, and distinguished voices throughout Wall Street are warning that 2023 can be a extremely rough 12 months.

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