This week, the US stock market touched yet another new record, after the latest figures allegedly showed a softening in inflation. Some news reports said inflation appears to have ‘peaked out’ in July.
But the ‘news’ is not always a reliable source of information. The press has a few cards up its sleeve, too. And when it reported that inflation had ‘moderated’, it did not necessarily lay them all on the table.
The actual reading for the consumer price index (CPI) went up last month, not down. Whether you look at the regular CPI or the ‘core’ CPI (excluding food and energy), the number was higher for July than it was for June. Here’s the official data from the Bureau of Labor Statistics, without the media spin:
‘In July, the Consumer Price Index for All Urban Consumers rose 0.5 percent on a seasonally adjusted basis; rising 5.4 percent over the last 12 months, not seasonally adjusted. The index for all items less food and energy increased 0.3 percent in July (SA); up 4.3 percent over the year (NSA).’
You can even ‘stack’ the numbers up over two years to avoid the alleged ‘COVID-19 bounceback’. They show the same thing — higher prices.
Here’s Breitbart on the story last week:
‘Inflationary pressures continued to rise in the services sector in July, surveys of business executives showed Wednesday.
‘The prices index of the Institute for Supply Management’s survey of executives in services businesses rose to 82.3 percent, up 2.8 percentage points and the highest level for its price index since 2005.
‘“Costs have risen dramatically in the last 45 days. Lodging, fuel, travel and supplies are all rising sharply. Costs for available labor are also rising, as demand increases in a diminished labor pool,” an executive in the construction industry said.’
This is not just a US phenomenon. Almost all central banks, like heroin addicts, are sharing the same dirty needle. And so are central governments.
They spend to buy votes…and reward the elite who control the government.
They borrow because they run out of money.
And they print because if they had to rely only on what they could borrow honestly, interest rates would spike upwards, causing a panic and a depression.
This silly system probably would have already caused a lot more inflation, if not for the hard work of the Chinese, Indians, Vietnamese, Mexicans, et al. They laboured so cheaply that for three decades, it offset the inflationary policies of Western authorities.
But now, wages in low-wage countries are rising, too. And that, combined with dumbhead trade wars and COVID-19 restrictions, is forcing up prices all over the planet.
Even the Teutons are not immune. MarketWatch reports:
‘German consumer prices climbed in July, confirming preliminary data, the German statistics office Destatis said Wednesday.
‘Consumer prices rose 3.8% on year measured by national standards, in line with the forecast by economists polled by The Wall Street Journal. They rose 3.1% on year by European Union-harmonized standards, also as forecast.’
And while we don’t know what the inflation readings will be next month or next year…if they are higher still, we fully intend to say, ‘We told you so’.
Because, between Delta variant panics, the Federal Reserve’s money-printing, and the spend-a-palooza on Capitol Hill, higher ‘inflation’ rates will be hard to avoid. Here’s CBS News:
‘The Senate passed a budget resolution early Wednesday that lays the groundwork for Democrats’ massive $3.5 trillion spending package, capping a flurry of activity just hours after senators approved a separate $1 trillion infrastructure bill.’
‘Budget’ is probably the wrong word. ‘Resolution’ sounds off-key, too.
‘Budget’ suggests self-discipline…and trade-offs. It hints at limits…and that bad things will happen if you ignore them. Budget ‘busting’ sounds like something you don’t want to do.
None of those things seem to apply to the latest Senate whoopee moment. Funding (in fake money, of course) appears unlimited. No give-and-take is required. And nobody gives a damn if trillions of dollars are squandered on goofy projects.
And the use of the word ‘resolution’ is embarrassing. Resolute was the name of a 19th century British Royal Navy ship, which became trapped in the Arctic ice.
By steadfast discipline and iron will, the crew survived two Arctic winters, skeletal rations, and a ‘hard march’ across the ice to rescue ships.
A year later, in 1855, the abandoned Resolute was found drifting in an ice floe by an American whaler, whose captain recorded the discovery in his journal:
‘Finally, stealing over the side, they found everything stowed away in proper order for desertion — spars hauled up to one side and bound, boats piled together, and hatches closed. Everything wore the silence of the tomb. Finally reaching the cabin door they broke in, and found their way in the darkness to the table. On it they accidentally turned on a box of lucifer matches; in a moment one was ignited, the glowing light revealed a candle; it was lit and before the astonished gaze of these men exposed a scene that appeared to be rather one of enchantment than reality. Upon a massive table was a metal teapot, glistening as if new, also a large volume of Scott’s family Bible, together with glasses and decanters filled with choice liquors. Near by was Captain Kellett’s chair, a piece of massive furniture, over which had been thrown, as if to protect this seat from vulgar occupation, the royal flag of Great Britain.’
The ‘resolute desk’ was made from the stout oak timbers of the ship, and now sits in the White House Oval office.
The Resolute story is one of manful determination and commitment to duty. It is the opposite of the budget ‘resolution’ story, which bespeaks an almost incredible disregard for risk, a total lack of foresight, and wanton jackassery.
It is a shame to sully such a stand-up word by using it to describe such irresolute action by the US Senate.
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