The Consumer Price Index data for July cooled even more than expected. The question is how will the Federal Reserve play this? In this episode of the Friday Gold Wrap podcast, host Mike Maharrey breaks down the CPI data, talks about the Fed reaction, and speculates about the Fed’s next move and its impact on the economy.
The Federal Government ran a $211B deficit in July. Except for February, this was the largest deficit since last July when the Treasury ran a deficit of $302B, and it was the second-largest July deficit ever.
The tax man cometh!
And thanks to the Democrats in Congress, there will be more tax enforcers shining their lights into the nooks and crannies of Americans’ finances.
Cooling Consumer Price Index data did not cool the hot rhetoric coming from some Federal Reserve members. The question is whether this is a bunch of hot air or do these central bankers actually have the fortitude to move forward with rate hikes in the face of a sinking economy?
The latest seasonally adjusted inflation rate for July came in nearly flat at -0.03%. This was on the heels of a blisteringly hot June number of 1.35%.
While inflation did surprise to the downside, it had been expected to be much lower due to the fall in oil and drop in gasoline prices. The YoY number also fell as the reading from last July of 0.46% fell off the calendar.
As expected, the Consumer Price index cooled a bit thanks to falling gasoline prices. The question is will this give the Federal Reserve the excuse it needs bow out of the inflation fight?
The Consumer Price Index for July was up 8.5% year-on-year. That was down from June’s 9.1% print and slightly below the 8.7% expectation. Of course, an 8.5% increase in prices over the course of a year is still extremely hot.
The Federal Reserve is all-in on the inflation fight.
Or is it?
While everybody focuses on interest rate cuts, the promised Fed balance sheet reduction isn’t going quite as promised.
We get a lot of Orwellian spin out of Washington D.C. A recession isn’t a recession, Putin’s price hikes caused inflation, and now we’re told a massive spending bill will cure inflation.
Last weekend, the Senate gave final approval to the so-called “Inflation Reduction Act.” Despite the catchy title, it is nothing but a tax-and-spend bill. The pundit class insists this will not only cool inflation but will also lower the budget deficit. This is a pipe dream. As Ron Paul explains, the bill will not only increase inflation, it will also increase government spending and taxes.
Consumers continue to add to their record level of debt as higher prices squeeze wallets.
Americans added another $40.1 billion to the debt load in June, according to the latest data from the Federal Reserve. That represents a 10.5% year-on-year increase.
The July non-farm payroll report came out much stronger than anticipated. According to the Bureau of Labor Statistics, the economy added 528,000 jobs and the unemployment rate ticked down to 3.5%. The narrative was that this blockbuster employment report proves that we’re not in a recession.
In his podcast, Peter Schiff broke down the data and reveals the truth behind the “strong job market” hype.
