In the spring of 2021, the Fed was still insisting spiking inflation was “transitory.” Fast forward one year. Inflation is as hot as ever. Fed Chair Jerome Powell was forced to abandon the transitory narrative last fall. In April, the CPI was up 8.3% on an annual basis. Today, Powell admits the Fed was wrong, but claims everybody else made the same mistake.
Well, not everybody, as the following clips prove.
When the Federal Reserve tinkers with interest rates, it creates all kinds of economic distortions. This is very obvious in the housing market. Over the last couple of years, the Fed blew up a giant housing bubble. Now, the central bank has pricked that bubble. In this episode of the Friday Gold Wrap podcast, host Mike Maharrey looks at the housing market as a microcosm of the broader economy.
There is all kinds of spin out there when it comes to inflation. Peter Schiff recently appeared on News Nation to talk about the economy. He explained that the spin misses the mark. The real source of inflation isn’t the pandemic or Putin. It’s the Federal Reserve.
People come up with all kinds of excuses for inflation. First, they told us there was no inflation. Then they insisted that it was transitory. Then they claimed it was caused by greedy corporations. Later they shifted the blame to Putin. But none of this gets to the root cause of inflation – the expansion of the money supply by the Federal Reserve.
The Federal Reserve has talked a lot about fighting inflation. But what has it actually done?
In practice, not a lot. It has nudged interest rates up 75 basis points. And while the Fed has ended the massive quantitative easing program that it ran during the pandemic, it pushed balance sheet reduction back from May until June. In fact, the balance sheet has crept upward throughout the entire month of May.
Federal Reserve Chairman Jerome Powell insists the central bank can fight inflation because the economy is strong. President Joe Biden keeps telling us the economy is strong. The talking heads on CNBC insist the underlying economy is strong. In a recent podcast, Peter Schiff talked about the economy. As it turns out, it’s not so strong.
The mainstream is concerned about the Fed pushing the economy into a mild recession as it battles inflation. Peter Schiff recently appeared on NTD News to talk about the economy. He said the recession is already here and it’s not going to be mild!
There is a lot of spin out there when it comes to economic news. You get spin from the corporate media, You get spin from government officials. And you get spin from central bankers. In this episode of the Friday Gold Wrap, host Mike Maharrey spins the spin, breaking down the media take on the retail sales numbers and Jerome Powell’s spin during a talk this week. Whom should we believe? Listen and decide.
It’s the Fed’s “hold my beer” moment.
After more than a year in which Federal Reserve leadership appeared clueless, pollyannish, and indecisive, the Fed is conducting a full-throated messaging campaign to show that it is as serious as cancer about the inflation surge that is scaring the bejesus out of consumers, investors, and economists.
Federal Reserve Chairman Jerome Powell spoke during the Wall Street Journal’s Future of Everything Festival on Tuesday and continued to talk tough about fighting inflation, all the while spinning Keynesian economic myths. In his podcast, Peter broke down Powell’s comments and talked about what he thinks the central bank will really end up doing.
