It’s easy to get caught up in the day-to-day gyrations of the market, pronouncements of certain government or central bank officials, and the most recent data dump. So, it’s important to keep your eye on the ball. In this episode of the Friday Gold Wrap podcast, host Mike Maharrey breaks down the latest inflation data and the Fed meeting with his eye firmly focused on that ball.
Before digging into history, let’s look at the recent data. The latest seasonally adjusted inflation rate for November came in at 0.08%. The YoY rate was 7.17%, below median forecast of 7.3%.
President Joe Biden claims wages are rising faster than prices.
It might be unfair to say he’s lying, but he’s certainly misrepresenting the facts.
The fact is price inflation continues to eat away at your wages.
The Federal Reserve got just the news it needed to plausibly go forward with a soft pivot in its monetary policy and begin to slow its pace of rate hikes. But while price inflation appears to be retreating, it’s far from beat.
The Consumer Price Index (CPI) for November came in lower than expected, according to the latest data from the Bureau of Labor Statistics.
When people talk about “inflation” today, they generally mean rising prices as measured by the Consumer Price Index (CPI). But historically, “inflation” was more precisely defined as an increase in the amount of money and credit causing advances in the price level. Inflation used to be understood as an increase in the money supply. Rising prices were a symptom of inflation.
I find this change in definition problematic. But many disagree with me. They argue that I’m being pedantic and the definition doesn’t really matter all that much.
Based on the Consumer Price Index (CPI), prices were up 7.7% year-on-year in October. That’s a pretty hefty inflationary bite. But we’ve been saying the impact of inflation is a lot worse.
The increased cost of a Thanksgiving meal this year bears that out.
The October CPI data came in a bit cooler than expected, but the market reaction was hot and furious. Peter Schiff broke down the CPI data and the market reaction to it in his podcast. Despite the spin, Peter said the Fed isn’t making any progress in fighting inflation.
They say perception is reality. Based on the October CPI data, the perception is inflation has peaked. But what’s the reality? In this episode of the Friday Gold Wrap podcast, host Mike Maharrey digs into the CPI data along with the markets’ reaction to it and wonders if the inflation victory dance is a little premature. He also talks about the big rally in gold and central bank gold buying.
The perception is that CPI cooled significantly in October, but the data doesn’t quite bear this out.
The latest seasonally adjusted inflation rate for September came in at 0.44%. The YoY rate was 7.7%, or 7.8% when adjusting for Household Ops. which has not been consistently reported over the last year. The increase was actually above the previous month of 0.38%, but the YoY number fell because last October was 0.87% and fell off the report this month.
Inflation is squeezing American budgets to the breaking point.
According to a LendingClub survey, the number of Americans living paycheck to paycheck is nearing record levels.
