Commentary: Don’t Be Fooled by October’s Decrease in the Rate of Inflation

October’s Consumer Price Index, the measure of the national rate of inflation, was at 7.7 percent in October, compared to a reading of 8.2 percent in September. The report propelled “U.S. stocks forward [at the open] and sent Treasury yields tumbling as Wall Street weighed the implication of softer prints on Federal Reserve policy.”

The decline in the rate of inflation was driven by declining annual prices of “necessities” such as smartphones (-22.9 percent), admission to sporting events (-17.7 percent), televisions (-16.5 percent), and women’s outerwear (-1.4 percent), all items that are discretionary purchases.

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Adjusted for Tax Relief, Virginia Revenue Up 8.3 Percent Year-to-Date

Virginia’s tax revenues four months into Fiscal Year 2023 are down 3.1 percent compared to Fiscal Year 2022, although when adjusted for timing and $250 tax rebates sent to Virginians, revenues are up 8.3 percent compared to the previous year, according to a presentation Secretary of Finance Stephen Cummings prepared to share with legislators.

Adjusted for $88 million paid out in October as part of the rebates, Virginia’s October revenues hit a 10.3 percent year-over-year increase, ahead of forecasts.

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Reports Indicate Connecticut GDP Fell in Second Quarter

The economy in Connecticut has some catching up to do.

Initial figures from the U.S. Bureau of Economic Analysis show the state’s economy fell behind the rest of the nation in the second quarter of 2022.

Connecticut’s gross domestic product fell by 4.7 percent between April and June, putting the state second-to-last in the nation. Meanwhile, personal income grew by only 2.2 percent.

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As Inflation Rages On, More Americans Are Living Paycheck to Paycheck

As inflation continues to batter consumers, the number of Americans living paycheck to paycheck climbed to 60% in August, according to a Friday report from financial services company LendingClub.

The increase, up from 57% in September 2021, was driven primarily by a greater portion of six figure earners slipping into a paycheck-to-paycheck lifestyle, according to the LendingClub report. While the proportion of those earning less than $50,000 and those between $50,000 and $100,000 living paycheck to paycheck stayed roughly the same, at 73.6% and 62.4% respectively, earners between $100,000 and $150,000 saw a more than 6.5% increase to 43.8% living paycheck-to-paycheck.

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Goldman Sachs Warns Investors High Rates Are Here to Stay

Even in the best case scenario where the Federal Reserve is able to combat inflation without causing a recession, it is unlikely to cut interest rates, Goldman Sachs analysts warned in a note, according to Business Insider.

The Federal Reserve has raised rates three times in the past four months, with Wednesday’s 0.75% increase bringing primary credit rates to 3.25%, one of the most aggressive increases since the 1980s. However, even in a so-called “soft landing” where a recession and layoffs are avoided, the Fed is unlikely to cut interest rates until “something goes wrong,” according to a Goldman Sachs note reported by Business Insider.

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Commentary: Powell Won’t Admit How America Got into Such Dire Economic Straits in the First Place

The Federal Reserve’s decision to raise target interest rates by 75 basis points for the third time this year following a Wednesday meeting of the Federal Open Market Committee all but ensures American families’ financial pain will continue and our current recession will likely drag on.

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Fed Hikes Interest Rates for Third Time in Four Months

The Federal Reserve has raised target interest rates by 75 basis points for the third time this year following a Wednesday meeting of the Federal Open Market Committee.

The new target range for the federal funds rate is anywhere between 3% to 3.35% up from the current 2.37%, making it the most aggressive hike since the early 1980s. The Federal Reserve is expected to continue this trend into March of 2023 as an attempt to curb ongoing increases in inflation, CNBC reported.

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Dr. Murray Sabrin Talks About His New Book, Background, and Solutions to America’s Current Economy

Tuesday morning on The Tennessee Star Report, host Leahy welcomed libertarian, professor, and author Dr. Murray Sabrin to the newsmaker line to discuss his new book The Finance of Health Care and his thoughts on how to fix the American economy. 

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Commentary: Federal Reserve’s False Assumptions Push the Economy into Recession

Federal Reserve

Based on its assumptions, the Federal Reserve is doing everything right by raising interest rates rapidly after years of easy money. It will certainly succeed in its goal of “cooling down” the economy.

Unfortunately, the Fed’s basic assumptions are wrong, and it has already begun reducing Americans’ standard of living, as indicated by this week’s Commerce Department report showing the nation’s gross domestic product fell for the second quarter in a row, meeting the common definition of a recession.

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The Fed’s Preferred Inflation Metric Just Surged in Another Warning Sign for the Economy

The Federal Reserve’s preferred inflation gauge, the Personal Consumption Expenditures (PCE) price index, continued to surge in June, according to data released Friday by the Bureau of Economic Analysis (BEA).

The PCE index was up 6.8% for the year ending in June, an increase from the 6.3% that it was at in both April and May, the BEA announced. PCE is the Fed’s preferred measure of inflation because it is “just better at capturing the inflation people actually face in their lives,” and the central bank endeavors to keep it at 2%, Federal Reserve chair Jerome Powell said Wednesday.

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Federal Reserve Announces Rate Hike to Combat High Inflation

The U.S. Federal Reserve announced another 0.75% rate hike Wednesday in response to inflation, which has soared to its highest level in more than four decades.

The announcement comes after just last month the Federal Reserve announced a rate hike of the same size, which at the time was the largest rate increase since 1994. 

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Barry Loudermilk Attacks Biden’s ‘War on American Energy’

Georgia’s 11th Congressional District (GA11) Representative, Barry Loudermilk, criticized President Joe Biden and the EPA’s Fiscal Year (FY) 2023 Budget on Tuesday.

“Biden’s war on American energy production is getting an assist from the Democrat-led Congress in the FY23 Interior and EPA appropriations package. [It] restricts offshore drilling in the Gulf of Mexico and restricts new projects in designated areas of the continental shelf,” Loudermilk said.

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Federal Reserve Chair Powell Says During Senate Hearing That a Recession Is Possible

Federal Reserve Chair Jerome Powell said the U.S. could enter into a recession when questioned Wednesday during a Senate Banking Committee hearing.

Confronted about 40-year-high inflation and the Fed raising interest rates in response, Powell said he couldn’t know for sure but said a recession, defined as a significant decline in economic activity over time, is possible.

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Senator Kyrsten Sinema Criticizes Federal Reserve for Delayed Action on Inflation

Senator Kyrsten Sinema (D-AZ) criticized the Federal Reserve for being too slow to react to inflation that is crippling the country.

In response to the growing crisis, the group raised interest rates by 0.75 percentage points, which is the largest increase since 1994.

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Crom’s Crommentary: ‘Dramatic Cut in Spending and Regulations’ Is the Only Way Out of U.S.’s $30 Trillion, Catch-22 Deficit

Wednesday morning on The Tennessee Star Report, host Leahy welcomed the original all-star panelist Crom Carmichael to the studio for another edition of Crom’s Crommentary.

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Jerome Powell Confirmed for Second Term as Federal Reserve Chair

The Senate voted 80-19 on Thursday to confirm Jerome Powell to a second term as Federal Reserve chair, even as inflation has hit record highs under his watch.

The 19 “Nay” votes came from 13 Republicans and 5 Democrats and included a range of Senators from Sen. Ted Cruz (R-Texas) to Sen. Bernie Sanders (I-Vt.).

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Commentary: Joe Biden vs. We the People

The Biden Administration last June unveiled its “National Strategy for Countering Domestic Terrorism.” Despite its anodyne-sounding name, the “national strategy” was anything but anodyne. The pamphlet represented the logical culmination of the Left’s cynical use of the January 6, 2021, U.S. Capitol riot as a means of ginning up large-scale, nationwide anti-Republican/anti-Trump voter sentiment.

The result, evinced again by Attorney General Merrick Garland’s disgraceful October 2021 memo directing the FBI to intrude on local school board meetings and crack down on anti-critical race theory parental revolts, has been a roiling cold war waged by the ruling class against us “deplorables” and our political “wrong-think.”

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Fed Report: Inflation Passed on to Consumers, Will Continue for Months

Newly compiled data from the Federal Reserve shows that inflation is hurting businesses, costing consumers, and likely not going away anytime soon.

The Federal Reserve released its “Beige Book,” a report that compiles reports from “Bank and Branch directors and interviews with key business contacts, economists, market experts, and other sources” from the 12 Fed districts around the country.

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Inflation Hits 10.9 Percent in Metro Phoenix, Highest of Major Metro Areas and Substantially Above National Average

Inflation is soaring under the Biden administration, and it’s even worse in Phoenix. The Bureau of Labor Statistics reported that inflation in metro Phoenix jumped 10.9% from February 2021 through February 2022, significantly more than the national average increase of 8.5% and higher than any other major metro area. This is one of the highest levels reported for Phoenix, the Common Sense Institute found.

The 8.5% inflation rate is the highest in the U.S. in 41 years. In 2020, the last year of Donald Trump’s presidency, it was only 1.5%. It began spiking as soon as Joe Biden entered office. The main goods driving the spike nationally are food, gas, and housing. 

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Consumer Prices Rise 8.5 Percent, the Highest in 40 Years

Newly released federal inflation data show that prices continue to rise at the fastest rate in four decades, continuing the trend of soaring inflation.

The Bureau of Labor Statistics released its Consumer Price Index, a key indicator of inflation, which showed prices rose an additional 1.2% in March, part of an 8.5 percent spike in the past 12 months.

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Feds: Retail Food Prices to Increase by an Additional Five Percent

The U.S. Department of Agriculture expects U.S. food prices to increase by at least another 5% on average this year as the majority of Americans surveyed in a new poll cite cost of living increases as a top concern and lack of confidence in President Joe Biden’s ability to do anything about it.

Rising prices are due to inflation, the Federal Reserve increasing interest rates, and consequences of Russia invading Ukraine, the USDA states in its most recent monthly Food Price Outlook, which forecasts retail food inflation.

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Prices Are Still Rising Despite the Fed Saying Everything’s Under Control

The price of goods throughout the economy rose at its fastest level in decades despite assurances from Federal Reserve Bank Chairman Jerome Powell earlier this month that the central bank would get inflation under control.

The personal consumption expenditures price index (PCE) surged 6.4% in February on a year-over-year basis, the fastest pace since January 1982, the Commerce Department announced Thursday. The Dow Jones estimate projected core PCE, which strips out food and gas, would increase by 5.5%.

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Economists Expect Elevated Inflation as Projected U.S. GDP Plummets

Economists across the U.S. expect ongoing inflation as the growth projections for the U.S. economy have plummeted, according to a newly released survey.

The National Association for Business Economics released a survey of 234 economic experts Monday that highlights major concerns about the U.S. economy. The report found inflation ranks as a top worry for economists.

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Fed Hikes, Higher Mortgage Rates Mark Consequences of Ongoing Inflation

Mortgage rates surpassed 4% for the first time since 2019 and the Federal Reserve announced a series of new rate hikes this week, two major shifts that mark the economic response to months of elevated inflation.

The Federal Reserve announced a 0.25% interest rate hike and said six more increases are on the way. Last week’s increase is meant to rein in inflation, but can have negative effects on economic growth. Meanwhile, mortgage rates are expected to increase along with the Federal Reserve rate.

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Biden Federal Reserve Nominee Sarah Bloom Raskin Withdraws Nomination

Sarah Bloom Raskin

Sarah Bloom Raskin, President Joe Biden’s pick for a key Federal Reserve position, withdrew her nomination Tuesday after receiving bipartisan pushback.

Raskin’s nomination faced fierce opposition by Republican lawmakers and industry groups that argued her previous positions on a range of topics including climate policy disqualified her for the job. Republicans on the Senate Banking Committee led by Ranking Member Pat Toomey have boycotted a vote to pass her nomination and four other nominations to the Senate for a floor vote since February.

“Unfortunately, Senate Republicans are more focused on amplifying these false claims and protecting special interests than taking important steps toward addressing inflation and lowering costs for the American people,” Biden said in a statement Tuesday. “I am grateful for Sarah’s service to our country and for her willingness to serve again, and I look forward to her future contributions to our country.”

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Central Bank Expected to Raise Interest Rates Wednesday

Person counting cash

The Federal Reserve is expected to raise interest rates after its meeting Wednesday to combat the country’s soaring inflation, Axios reported.

The central bank is believed to raise its target fed funds rate by a quarter percentage point from zero after the end of the two-day meeting ending Wednesday, Axios reported. The Fed’s decision will outline the bank’s monetary policy for the near future and determine whether the U.S. economy enters a recession or continues surging price hikes, according to Axios.

Inflation has soared to nearly 8% year-over-year as of February while unemployment stayed below 4%, indicating that the Fed has been behind the curve in its effort to address sustained inflation, Axios reported. Federal Reserve Chairman Jerome Powell is now reportedly tasked with fixing a delicate economy without crashing it despite a war in Ukraine and renewed COVID-19 lockdowns in China.

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Manchin Says No on Confirming Raskin for Fed Position, Likely Derailing Biden, Fellow Dems’ Effort

Democrat Sen. Joe Manchin said Monday that he will not support the nomination of Sarah Bloom Raskin to become the Federal Reserve’s top banking regulator, placing a major obstacle in her path to Senate confirmation.

In February, Republicans on the Senate Banking Committee uniformly opposed Raskin’s nomination by refusing to attend a committee vote to advance her position. The no-show act also created a blockade to the nominations of several other Fed nominees, including Chairman Jerome Powell.

Raskin to be confirmed needs 51 yes votes – a simple majority – in a final Senate vote.

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Inflation Soars to Another Four-Decade High

The Consumer Price Index (CPI) increased 0.8% in February, bringing the key inflation indicator’s year-over-year increase to 7.9%, the U.S. Bureau of Labor Statistics (BLS) reported.

The core price index, which measures inflation of goods less food and energy, increased 0.5% in February, the BLS reported. Food prices reportedly grew 7.9% on a year-over-year basis as of February, the BLS reported, and energy prices soared 25.6%.

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Crom’s Crommentary Ties Together Gender Identity, Federal Reserve, Modern Monetary Theory, and Keynesianism

Person walking down the aisles in Walmart

Wednesday morning on The Tennessee Star Report, host Leahy welcomed the original all-star panelist Crom Carmichael in-studio for another edition of Crom’s Crommentary.

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Georgia Representative Barry Loudermilk Grills Federal Reserve Chair Jerome Powell About Inflation

Representative Barry Loudermilk (R-GA-11) this week reminded Federal Reserve Chair Jerome Powell about Loudermilk’s warnings from one year ago about inflation — a prediction that proved correct. Loudermilk discussed the matter at a U.S. House Committee on Financial Services hearing.

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Federal Reserve Chairman Powell Announcing Increase in Interest Rates This Month

Federal Reserve Chairman Jerome Powell will announce Wednesday that the central bank will begin raising interest rates this month – in an attempt to curb rising inflation expected to further increase as a result of Russia’s invasion of Ukraine.

In prepared testimony to a congressional committee, Powell says the Fed will “need to be nimble” in responding to unexpected changes resulting from the invasion and the resulting sanctions, according to the Associated Press.

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Home Prices Up, Inventory Down Across Wisconsin

There is good news for people looking to sell a home in Wisconsin, but the news is not so great for people looking to buy.

The Wisconsin Realtors Association released its latest report on home sales on Monday.

The numbers show fewer homes for sale and fewer homes sold in January of this year, compared to January 2021.

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Commentary: Biden Nominee Reaps the Financial Rewards of Being ‘Connected’

Sarah Bloom Raskin

Who among us hasn’t made $1.5 million for sitting on an advisory board for two years? Not you? Come to think of it, me neither. Such money comes only to the well connected.

And “connected” is a good word to use in regard to Sarah Bloom Raskin, nominated last month by President Joe Biden to be Vice Chair for Supervision at the Federal Reserve System. Previously, from 2010 to 2014, she served as a Governor of the Fed, and then, from 2014 to 2017, she worked as Barack Obama’s Deputy Secretary of the Treasury.

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Fox Business Contributor and Finance Guru Liz Peek Talks Stock Market, the Fed, Inflation, and Future Outlooks

Thursday morning on The Tennessee Star Report, host Leahy welcomed Fox contributor and finance Wall Street expert Liz Peek to the newsmakers line to weigh in on the economic outlook for America.

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‘Extreme Left-Wing Positions’: Biden’s ‘Activist’ Fed Nominee Lisa Cook Once Supported Reparations

President Joe Biden’s nominee to regulate the banking industry has previously expressed support for economic reparations to black Americans, Fox Business reported Monday.

Lisa Cook, a professor of international relations and economics at Michigan State University, has an extensive history of supporting “race-specific” financial compensation “because the injury was race-specific,” Fox reported. Cook was nominated on Jan. 14 to serve on the Board of Governors of the Federal Reserve System.

“Everybody benefited from slavery. Everybody. So, I think that we absolutely need some sort of reckoning with that,” said Cook on the EconTalk podcast in September 2020. “One thing I do support is H.R. 40 … I think that’s absolutely what needs to be done,” said Cook in a March 2021 talk at Berkeley Haas, referencing a bill that would establish a commission to study and develop reparation proposals.

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Federal Reserve Indicates Interest Rate Hike Arriving in March

With both volatile markets and significant inflation in the mix, the Federal Reserve on Wednesday indicated that it may soon raise interest rates for the first time in more than three years.

“With inflation well above 2 percent and a strong labor market, the committee expects it will soon be appropriate to raise the target range for the federal funds rate,” the body said n a highly anticipated statement following its meeting.

The Federal Open Market Committee added that the central bank’s monthly bond-buying will proceed at just $30 billion in February, signaling that the program could come to an end in March as the interest rate increases.

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Biden’s Fed Nominee Lisa Cook Criticized for Being Unqualified, Embellishing Resume

President Joe Biden’s latest high-profile Fed nominee is in danger of being struck down in the Senate because she is widely seen by her peers as a left-wing activist rather than a serious monetary economist, several economists told the Daily Caller News Foundation.

Biden appointed Lisa Cook, a professor of international relations and economics at Michigan State University and former Obama White House staffer, on Jan. 13 to serve on the Board of Governors of the Federal Reserve, which regulates the banking industry.

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Inflation Soars to Highest Level Since 1982

The Consumer Price Index (CPI) increased 0.5% in December, bringing the key inflation indicator’s year-over-year increase to 7%, the U.S. Bureau of Labor Statistics (BLS) reported.

The CPI soared to 7% on a year-over-year basis in December, the highest level in almost four decades, the BLS reported Wednesday. Economists surveyed by The Wall Street Journal projected the index would soar past 7.1% in December.

“There’s still a lot of scarcity in the economy. Consumers and businesses are in great financial shape, and they’re willing to pay up for more goods, more services and more labor,” Sarah House, director, and senior economist at Wells Fargo, told the WSJ.

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Federal Reserve Chairman Powell Says Inflation Poses ‘Severe’ Threat to Job Market

Federal Reserve Chairman Jerome Powell acknowledged Tuesday that high inflation is indeed a serious threat to the U.S. central bank’s goal of helping to get U.S. employees back to work.

He also said the Fed will raise rates higher than initially planned if needed to slow rising prices, according to the Associated Press.

“If we have to raise interest rates more over time, we will,” Powell told the Senate Banking Committee, which is considering his nomination for a second four-year term, the wire service also reports. “High inflation is a severe threat to the achievement of maximum employment.”

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Nasdaq Expected to Underperform the S&P 500 for First Time in over Five Years

The Nasdaq Composite, a technology-heavy index of publicly-traded companies, is set to underperform the S&P 500 for the first time since 2016, according to CNBC.

The S&P 500, a stock market index consisting of the 500 largest publicly-traded companies in the U.S., climbed 28% in 2021 as of Monday, while the Nasdaq was up 23% on a year-over-year basis, according to CNBC. The S&P 500 previously beat the Nasdaq in 2016 and 2011.

The Nasdaq had a strong start to 2021, almost doubling the S&P 500 in February, CNBC reported. Trading slowed after the arrival of the COVID-19 vaccines, which boosted sentiment among investors that the pandemic was ending, reducing demand for remote work technology and other tech-focused goods.

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Inflation Hits Highest Level in 39 Years

Large crowd of people shopping during the holidays

The Consumer Price Index (CPI) increased 0.9% in November, bringing the key inflation indicator’s year-over-year increase to 6.8%, the highest figure in four decades.

The CPI’s increase is the largest increase in four decades, up from October’s 6.2% according to the U.S. Bureau of Labor Statistics (BLS) report released Friday morning. Experts surveyed by CNBC projected inflation would increase 0.7% in November, translating to a 6.7% gain on a year-over-year basis.

“These are frighteningly high inflation numbers, the likes of which we haven’t seen for decades,” Allen Sinai, chief global economist and strategist at Decision Economics, Inc., told The Wall Street Journal.

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Experts Predict Less Economic Growth, Elevated Inflation for Years to Come

Woman shopping, going up escalator

A survey released Monday found that business experts expect prices and inflation to rise at elevated levels for years to come.

The National Association for Business Economics released the results of a survey of 48 economic experts who downgraded their growth predictions and projected elevated inflation through the second half of 2023, if not later.

“NABE Outlook survey panelists have ramped up their expectations for inflation significantly since September,” said NABE Vice President Julia Coronado, founder and president, MacroPolicy Perspectives LLC. “The core consumer price index, which excludes food and energy costs, is now expected to rise 6.0% from the fourth quarter of 2020 to the fourth quarter of 2021, compared to the September forecast of a 5.1% increase over the same period.”

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November Jobs Report Is One of the Worst Since Biden Took Office

The U.S. economy added 210,000 jobs in November, marking nearly the lowest number of jobs created in a month since President Joe Biden took office in January.

November’s jobs report was well below economists’ estimate of 573,000, according to CNBC. Additionally, unemployment fell to 4.2% from October’s 4.6% figure, according to the Bureau of Labor Statistics (BLS).

The U.S. economy, still recovering from the COVID-19 pandemic but now subject to uncertainty related to the Omicron coronavirus variant, appeared to slow in momentum in November, The Wall Street Journal reported.

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Federal Reserve Study Contradicts Biden on Climate Risks to Banks

Joe Biden

The Federal Reserve concluded that weather disasters are “not very” bad for financial institutions despite the Biden administration’s warnings that climate change is an “emerging” threat to banks.

“We find that weather disasters over the last quarter century had insignificant or small effects on U.S. banks’ performance,” the report, published in November by the Federal Reserve Bank of New York, stated. “This stability seems endogenous rather than a mere reflection of federal aid.”

The report added that extreme climate events “actually boosts profits” for larger banks because of increased loan demand. In addition, smaller banks are adept at avoiding mortgage lending in flood prone areas using local knowledge of the region they are based.

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Biden to Renominate Jerome Powell for Second Term as Federal Reserve Chair

Jerome Powell

President Joe Biden will renominate Federal Reserve Chairman Jerome Powell to a second term leading the central bank.

The president, who was elected as a moderate, has faced pushback on Powell, who progressives feel is not tough enough on bank regulations or climate change policy.

Also in contention for the top job was Lael Brainard, who Biden will nominate to become the vice chair of the central bank’s board of governors.

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Fed Official Sees Inflation Slowing in 2022, Future Price Increases Wouldn’t Be ‘a Policy Success’

Federal Reserve Vice Chairman Richard Clarida said he expects the recent spike in inflation to dissipate as supply and demand imbalances ease and that future price increases in 2022 would cause problems for the central bank.

“I do continue to judge that these imbalances are likely to dissipate over time as the labor market and global supply chains eventually adjust and, importantly, do so without putting persistent upward pressure on price inflation and wage gains adjusted for productivity,” Clarida said in remarks prepared for delivery on Monday.

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Federal Reserve Scales Back Bond Purchases as Inflation Rises

The Federal Reserve announced Wednesday that it would begin scaling back its monthly bond purchases in November, marking the first step towards ending its pandemic stimulus as inflation surges.

The scaling of bond purchases, more commonly known as tapering, will start “later this month,” the Federal Open Market Committee (FOMC) said in a statement. The Federal Reserve will reduce its purchases by $15 billion each month — $10 billion less in Treasury bonds and $5 billion less in mortgage-backed securities — from the current $120 billion figure.

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