Last week’s jobs numbers came in weaker than expected. September’s CPI came in hotter than expected. That puts the Federal Reserve between a rock and a hard place. Does it tighten monetary policy to fight inflation? Or does it keep stimulating to boost the economy? In this episode of the Friday Gold Wrap, host Mike Maharrey breaks down the data and says it’s about time for the central bank to pick its poison.
The CPI data for September came in hotter than expected at 0.4%. That pushed the yearly gain to 5.4%. But an honest CPI calculation would come in even hotter.
I am doing something different this month. In past reviews of the CPI, I typically take the BLS data and recalculate the values to get a more detailed number that is rounded to two decimal points instead of one. This methodology also allows me to show the impact of each component on the top-line number.
With CPI data once again coming in hotter than expected, it’s getting harder and harder for the mainstream to swallow the “transitory inflation” narrative.
And some people are starting to worry.
During an earnings call, JPMorgan Chase CEO Jamie Dimon expressed concerns about higher than expected and persistent inflation ahead.
September CPI came in above expectations. At this point, even the central bankers at the Federal Reserve are having a hard time sticking to the “transitory inflation” narrative.
In his podcast, Peter Schiff talked about the CPI report. He said it reveals that we’re entering an inflation super-cycle and perhaps the markets are starting to figure this out.
Peter called this the “government report card on inflation,” noting that it’s not particularly reliable because the government is grading itself.
Government policies – from shutdowns, to stimulus, to vaccine mandates – in response to the coronavirus pandemic have thrown the US economy completely out of whack. Looking at employment reveals just how messed up the economy has become.
The number of Americans quitting their jobs surged to a record high in August. According to the Labor Department Job Openings and Labor Turnover Survey (JOLTS) report, job quits increased by 242,000 in August, pushing the total to a record 4.3 million. The quits rate surged to an all-time high of 2.9% in August from 2.7% in July.
We got the highly anticipated employment report on Friday. It came in far below expectations. But despite weak economic data, bond yields are rising, along with the price of just about everything. Meanwhile, a gold rally fizzled. Peter Schiff talked about it during his podcast, explaining just how badly the markets are misinterpreting the data. When you add up plunging bonds yields, strong oil, and weak economic data – that equals stagflation.
Inflation continues to run hot. Even some of the folks over at the Fed are having a hard time peddling the “transitory” inflation narrative. But politicians and government officials lack the skill of self-reflection. As a result, they can’t clearly see the problem. In this episode of the Friday Gold Wrap, host Mike Maharrey looks at some of the latest inflation data and the Fed’s response to it. He also touches on the fake debt ceiling fight and breaks the September job report numbers.
Personal income rose again in August, but once again rising prices ate up all the gains and then some.