Now inflation is Russia’s fault. Or is it greedy businesses pushing up prices? Maybe a combination of the two.
It seems that government officials and central bankers are looking everywhere for a place to pin the blame for inflation except the one place they need to look — in the mirror.
Gold flowed into gold-backed ETFs for the second straight month in February.
Net inflows of gold into ETFs globally totaled 35.3 tons last month. Total ETF gold holdings globally ended February at 3,650.6 tons, according to the latest data from the World Gold Council.
Jerome Powell testified on Capitol Hill last week. He said the central bank plans to hold the course on rate hikes and monetary tightening despite the global chaos caused by the Russian invasion of Ukraine. He also continued to dodge any responsibility for rampant inflation. In fact, he repeated a lie Ben Bernanke told in 2008 and insisted the Fed isn’t monetizing federal government debt because it doesn’t intend to hold those Treasuries forever. But as Peter Schiff said in his podcast, it doesn’t matter what the Fed intends to do. All that matters is what it actually does.
Debt issuance by the US Treasury has fallen since the binge in December when the Treasury had to replenish its “extraordinary measures” stockpiles (government employee retirement funds) after the end of the “debt ceiling” debate. Still, issuance remains relatively high.
The Treasury added another $278 billion in debt during February. Similar to January, the Treasury stopped converting short-term to long-term debt Instead, it increased Bills by $94 billion, more than any other security type.
February was another very strong jobs month with the economy adding an estimated 678,000 jobs vs an expected 400,000.
The unemployment rate came in at 3.8%, down from 4%. Labor force participation also improved, rising from 62.2% to 62.3%. Both December and January numbers were revised upwards.
You’re getting less for more every time you pull out your wallet. Inflation is chewing up the average person’s paycheck. In this episode of the Friday Gold Wrap podcast, host Mike Maharrey talks about the real pain of inflation. He also talks about Jerome Powell’s testimony before Congress, the trajectory of monetary policy, the strength of the economy, and he breaks the February jobs report live.
As economic sanctions began to put a stranglehold on the Russian economy, long lines formed at banks and ATMs as everyday people tried to pull cash from their bank accounts. A Russian economy expert from the Foreign Policy Research Institute called it “a full-fledged bank run.”
Inflation continues to chew up your paycheck.
While consumer prices rose 0.7% in January, income from all sources, including wages, salaries, interest dividends, rental income, unemployment, Social Security, etc. was essentially flat.
And when adjusted for inflation, real personal income fell by 0.5%.
On Tuesday, the Atlanta Fed cut its GDP estimate for the first quarter of 2022 to zero.
Just a few days ago, the estimate was for 0.6% growth. That was down from 1.3% just a few days before that.
This is not an encouraging trend.
The Russian invasion of Ukraine has completely changed the market dynamics. In his podcast, Peter talked about the impact the situation is having on the markets and the global economy. He also looked ahead, saying Russia can now serve as a convenient excuse for the Fed to back off its planned monetary tightening. Of course, that will have consequences of its own.
