Greedy corporations are causing inflation by jacking up prices and enjoying record profits.
This has become an increasingly popular talking point on the political left. Elizabeth Warren has pushed this narrative hard.
And it’s patently absurd.
Are we heading toward housing crisis 2.0?
That remains to be seen.
Two things are for certain. This is a massive housing bubble. And the Fed is holding the pin.
St. Louis Federal Reserve President James Bullard unwittingly let the cat out of the bag and revealed the central bank doesn’t have the stomach to do what’s necessary to take on surging, persistent inflation.
Federal Reserve Chairman Jerome Powell “retired” the word “transitory” as it relates to inflation back on Nov. 30. Just two-and-a-half months later, we’re seeing a new word bandied about to describe inflation — persistent.
Less than a week after the January CPI data came in even hotter than anticipated (again), we got yet another signal that persistent is a much better word for the inflation situation. Producer prices (PPI) doubled expectations, charting the biggest increase in eight months.
The Federal Reserve wrapped up its first Federal Open Market Committee meeting of the year yesterday without any real surprises. Despite everybody screaming about an inflation problem, the Fed will keep its loose, inflationary monetary policy in play for at least two more months.
The Federal Reserve is talking about raising interest rates. But the US economy is buried under piles of debt. I’ve been asking how this is going to work for months. Apparently, the question has finally occurred to the mainstream.
A CNBC article declared, “Fed rate hikes will intensify a global debt crisis, research warns.”
So, how are your New Year’s resolutions going?
Mine are going fantastic!
I didn’t make any.
President Joe Biden is running around trying to take credit for a “booming” economy. It’s the ultimate political dumb-guy argument.
Elizabeth Warren and others are running around blaming inflation on greedy corporations’ “price gouging.” Of course, this narrative falls apart when you realize producer prices are rising faster than consumer prices. If anything, producers are letting consumers gouge them by not passing on all of their rising costs.
The Federal Reserve released the minutes from the December FOMC meeting on Thursday (Jan. 5) and the markets freaked once again at the prospect of monetary tightening. The minutes seem to indicate an even more abrupt shift to tighter monetary policy to fight inflation. But I have questions.
