During his post- FOMC meeting press conference, Federal Reserve Chairman Jerome Powell said, “Hope for the best; plan for the worst.”
I think he meant, “Live in hope; die in despair.”
The Atlanta Fed has lowered its GDP estimate for the third quarter to 0.3%, and the trend is downward. That means the economy is teetering on the verge of another quarter of negative GDP growth. Would that be enough to raise recession alarms?
Federal Reserve rate hikes will add trillions to the national debt, according to an analysis by the Committee for a Responsible Federal Budget.
When it comes to the economy, inflation, and the Federal Reserve, the mainstream just doesn’t get it.
This headline from Fox Business reveals the level of confusion.
“Retail sales unexpectedly edge higher in August despite soaring inflation” [Emphasis added]
While gold dropped last week, silver rallied. Peter Schiff called it a “silver lining” that could indicate we’re near the bottom in the precious metals dip.
Gold and silver have sold off with every inflation surprise to the upside. The markets think persistent inflation means the Fed will get even more aggressive with rate hikes. They fail to realize that the central bank will not bend this inflation curve.
Inflation continues to surprise to the upside. Meanwhile, the economy continues to surprise to the downside. But the markets continue to believe that the Federal Reserve can slay the inflation monster while still guiding the economy to a so-called “soft landing.” FedEx announced some news last week that undercuts this narrative. In his podcast, Peter Schiff talked about why the landing is going to be hard. And when the economy crashes, the Fed inflation fight will be over.
We got the August CPI data this week and it came in hotter than expected. Stocks suffered a big selloff. Everybody is betting on the Fed to get even more aggressive in its inflation fight. In this episode of the Friday Gold Wrap podcast, host Mike Maharrey breaks down the data and exposes a dirty little secret that the mainstream still hasn’t come to grips with.
Some things never change — such as the federal government spending more money than it has month after month after month.
August was no different. The US government ran a massive $219.6 billion budget deficit last month, according to the latest Monthly Treasury Statement. That nudged out July as the second-largest monthly deficit in fiscal 2022.
The CPI data for August came in hotter than expected, sparking the biggest market crash since the 2020 COVID lockdowns. The price of gold also dropped on the news in anticipation of the Federal Reserve taking interest rates higher. Peter Schiff talked about the inflation news on his podcast and said investors need to get gold now before the entry point rises a lot higher. Because at some point the markets are going to figure the Fed can’t bend this inflation curve.
The latest seasonally adjusted inflation rate for August came in nearly flat again at 0.09% MoM, dropping to 8.3% YoY. Expectations had been for -0.1% MoM and 8.1% YoY so the market had a very negative reaction to the report.
