Tag: inflation

Key Inflation Measure Spikes Again, Hits Highest Level Since 1991

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Person in white shirt, walking into Gap store

A consumer price measurement used by the Federal Reserve to track inflation spiked again in June and hit its highest level since 1991, government data showed.

The personal consumption expenditures (PCE) price index increased 4% over the 12 months between July 2020 and June, according to a Bureau of Economic Analysis report released Friday. Excluding volatile energy and food prices, the index spiked 3.5% in that same 12-month period.

The index increased 0.5% in June, in line with economists’ forecasts, CNBC reported.

“Inflation has increased notably and will likely remain elevated in coming months before moderating,” Federal Reserve Board Chair Jerome Powell said during a press conference this week. “As the economy continues to reopen and spending rebounds, we are seeing upward pressure on prices, particularly because supply bottlenecks in some sectors have limited how quickly production can respond in the near term.”

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Treasury Secretary Warns of ‘Rapid’ Inflation This Year

The Center Square
Janet Yellen

As more federal data show a major spike in inflation, another top federal official said the U.S. is in for more aggressive inflation for the rest of 2021.

Federal officials have been pressed to speak on rising inflation after \data released earlier this week showed that the all items index increased 5.4% over the last 12 months, the biggest spike since the 2008 financial crisis.

Treasury Secretary Janet Yellen commented on the rise in inflation, saying it would grow worse this year.

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Federal Reserve Chair: Inflation to be ‘Elevated for Months’

The Center Square
Jerome Powell

Federal Reserve Chairman Jerome Powell tried to calm lawmakers’ fears about rising inflation but also said it would probably remain elevated for months to come.

Testifying before Congress this week, Powell said the Federal Reserve was willing to step in to address the situation, but that inflation should level out next year.

“As always, in assessing the appropriate stance of monetary policy, we will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if we saw signs that the path of inflation or longer-term inflation expectations were moving materially and persistently beyond levels consistent with our goal,” Powell said in his prepared testimony.

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Commentary: Inflation Has Arrived

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Wildly excessive federal spending is causing major inflation and shortages, which may lead to a recession and perhaps a financial crisis. Despite the evidence of inflation, Congress is proposing to spend $3.5 trillion on top of the $1.9 trillion COVID relief bill passed earlier this year and the intended $1.2 trillion infrastructure bill. For comparison, federal revenue is only expected to be $3.8 trillion this year.

Evidently, the Democratic Party and President Joe Biden have adopted Modern Monetary Theory (MMT) to the peril of every American citizen. MMT, which is similar to Keynesian economics, says that the U.S. should not be constrained by revenues in federal government spending since the government is the monopoly issuer of the U.S. dollar. MMT is a destructive myth that provides cover for excessive government spending. And it’s not modern, since reckless government spending has been around for thousands of years.

Embracing MMT is similar to providing whiskey and car keys to teenage boys. We know the outcomes will not be good.

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Job Creators Network President Alfredo Ortiz Slams Biden for Taking Credit for Economic Recovery

Cooper Moran

After the monthly jobs report was released on Friday, President Joe Biden attempted to take a victory lap, claiming to be the cause of the increase in available positions.

However, many individuals such as the Job Creators Network President and CEO Alfredo Ortiz criticized Biden for claiming credit for the economic recovery and highlighted that the unemployment rate increased despite the added jobs.

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Inflation Takes Biggest 12-Month Leap Since 1990s, Key Report Shows

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Woman shopping, going up escalator

A key index used by the Federal Reserve to measure inflation showed that consumer prices leapt quicker over the last 12 months than they have in three decades.

The personal consumption expenditures (PCE) index surged 3.9% in the 12-month period between June 2020 and May, according to the Department of Commerce report released Friday. The PCE index excluding volatile food and energy prices increased 3.4%, the biggest leap since the 1990s, CNBC reported.

Energy prices increased 27.4% while food prices increased 0.4% over the last 12 months, the report showed.

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Commentary: Massive Government Spending Has Caused High Inflation Levels and a Weakening U.S. Dollar

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$100 bills in rubber bands

Inflation is up 4.92 percent the past 12 months as of May, the most since July 2008’s 5.5 percent, according to data compiled by the Bureau of Labor Statistics, amid a torrent of trillions of dollars of government spending, Federal Reserve money printing and a weakening dollar combined with the continued economic rebound led by reopening businesses from the 2020 Covid lockdowns.

The past three months alone, inflation has grown at an accelerated rate of 2 percent combined. If that trend were to hold up for the rest of the year, inflation would come closer to 8 percent.

In the month of May, price jumps in fuel oil at 2.1 percent and piped gas service at 1.7 percent offset a 0.7 percent drop in gasoline prices. In addition, new car prices grew 1.6 percent. Used cars and trucks grew at 7.3 percent again after a 10 percent jump in April. Apparel jumped 1.2 percent. And transportation services grew 1.5 percent after a 2.9 percent jump in April.

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Inflation Surges Five Percent, Largest Spike Since 2008

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The Consumer Price Index has increased 5% over the last 12 months, the fastest pace of inflation since August 2008, according to a Department of Labor report.

The Consumer Price Index (CPI), a common tool used to measure inflation, increased 0.6% between April and May, according to the Labor Department report released Thursday morning. Economists projected that the CPI increased by 0.5% and 4.7% over the 12-month period ending in May, according to The Wall Street Journal.

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Yellen Admits Inflation Is About to Surge But Says It Will Be ‘Plus For Society’s Point of View’

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Janet Yellen

Increased inflation could ultimately be a net positive for the U.S. economy and large government spending won’t overheat the economy, Treasury Secretary Janet Yellen told Bloomberg.

Treasury Secretary Janet Yellen, who previously chaired the Federal Reserve, said the central bank has been more concerned about inflation levels that are too low, according to Bloomberg. Increasing consumer prices could signal a return to normal, she said.

“We’ve been fighting inflation that’s too low and interest rates that are too low now for a decade,” Yellen told Bloomberg in an interview Sunday.

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Higher Inflation Has Arrived, But Economy Unlikely to Reach 1970s Levels, Report Says

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While rapidly increasing consumer prices have triggered fears that the U.S. economy may enter into a period of stagflation, it is unlikely to hit 1970s levels, an economic report concluded.

The current condition of the U.S. economy has created some fear that prices may precipitously and uncontrollably rise while unemployment stays elevated, according to the report authored by Heritage Foundation Center for Data Analysis Director Norbert Michel. But an analysis of inflation and employment data suggests Americans don’t need to overreact.

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Biden to Speak in Cleveland on Thursday

Cooper Moran

President Joe Biden is traveling to Cleveland, Ohio to deliver a speech on his economic efforts since taking office earlier this year. 

At his address at Cuyahoga Community College, Biden is expected to claim the solution to the country’s economic setback is his massive “infrastructure” plan — dubbed the “American Jobs Plan” — and the coronavirus “relief” bill passed earlier this year. 

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Top Economists Expect Inflation to ‘Accelerate Strongly’ in Coming Weeks

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Woman shopping

Economists expect inflation to “accelerate strongly” in the coming weeks and months, but said consumer prices would eventually moderate.

The consumer price index (CPI), a common measure for inflation, is expected to rise 2.8% in 2021 and 2.3% in 2022 compared to the 1.2% increase that occurred in 2020, according to economists surveyed by the National Association for Business Economics (NABE).

The projection, released Monday, reflected the Federal Reserve consensus that inflation will heat up by the end of the year before cooling down as the economic recovery continues.

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Republicans Release Plan to Address Growing Inflation Under Biden Administration

The Center Square
High gas prices

Congressional Republicans grabbed headlines this week after releasing an aggressive budget they say would cut taxes and spending, but key measures in the plan also would address one of the country’s most serious economic problems.

The House’s Republican Study Committee released a budget that lays out several measures to deal with inflation, a growing concern among economists after the latest federal data showed a spike in consumer prices. Notably, the index for used cars and trucks rose 10%, the largest one-month increase since BLS began recording the data in 1953. Food and energy costs rose 0.9% in the month of April, prescription drugs rose 0.5%, and gasoline rose 1.4% during the same month. The energy cost index rose 25% in the previous 12 months.

Republicans on the committee say their plan would address concerns over inflation by balancing the budget within five years, thereby eliminating the need to monetize debt, a process where the federal government prints money to make payments on what it owes. The national debt has soared to more than $28 trillion and is expected to continue climbing under President Joe Biden’s new spending plans.

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Virginia Finance Secretary Expects $500 Million Revenue Surplus, But Is Cautious About Future Effects of Inflation

Eric Burk

Virginia is on track for a revenue surplus of $500 million, according to presentations Secretary of Finance Aubrey Layne gave to legislators in the General Assembly this week. Layne was cautiously optimistic when describing Virginia’s financial situation, saying that many jobs have come back, and the housing market is booming.

“This all adds up to a very good performance for the first ten months of the year,” he said in a Tuesday presentation to the Senate Finance and Appropriations Committee. “We’re going to have a surplus that’s at least half a billion dollars and I think there’s an upward bias.”

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Senator Marsha Blackburn: ‘Biden Surcharge’ the Hefty Price Americans Pay for President’s Policies

Corinne Murdock

Senator Marsha Blackburn (R-TN) blamed the “Biden Surcharge” for the climbing prices of goods in this country. Blackburn coined the term during a Senate floor session on Thursday. She had a poster propped up next to her that read: “THE BIDEN SURCHARGE: PAYING A PREMIUM JUST TO LIVE FROM THE MOMENT YOU WAKE UP, TO THE MOMENT YOUR HEAD HITS THE PILLOW.” In a statement to The Tennessee Star, Blackburn claimed that Biden’s spending was to blame for the increasing cost of living nationwide.

“President Biden has recklessly spent American tax dollars throughout his first 100 days in office. Now, future generations will bear the burden of Biden as inflation catches up and grips our nation,” said Blackburn. 

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Commentary: Price Stability, not Inflation, Will Get the U.S. Economy Back to Full Employment Sooner Rather than Later

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2020 and 2021 are two sides of the same coin: Price instability brought about by the dollar being either relatively too strong or too weak, which can lead to or exacerbate economic slowdowns, creating higher unemployment and worse if the conditions persist for too long.

In 2020, at the height of the Covid pandemic, the problems included the global economy being shut down plus local lockdowns resulting in a massive recession and a flight to safety into U.S. treasuries as interest rates collapsed, making the dollar too strong. With the onset of deflation, consumer prices plummeted in March and April 2020, with oil even dropping briefly below zero dollars for the first time in history, and a concurrent rise of unemployment as 25 million Americans lost their jobs.

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Consumer Prices Increase 4.2 Percent to the Highest Level Since 2008

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The consumer price index has jumped 4.2% over the last 12 months, the fastest pace of inflation since 2008, according to a Department of Labor report.

The consumer price index (CPI) increased 0.8% between March and April, according to the Labor Department report released Wednesday morning. Economists projected that the CPI increased by 0.2% last month and 3.6% over the 12-month period ending in April, according to The Wall Street Journal.

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Commentary: Joe Biden, Economy Killer

RealClearWire
President Joe Biden

Along with a working vaccine, Joe Biden inherited a V-shaped economic recovery, but he is now planting the seeds of its destruction. Inflation, federal deficits, high taxes, incentives for workers to stay home, and incentives to avoid investment – they’re all coming back. Together, these elements create the perfect brew for a Lyndon Johnson-style stagflation. If Biden and the Democrats so quickly wreck the good economic path they were given, it will be one of the worst examples of government malpractice in U.S. economic history. 

In the first, dark days of the COVID-19 national economic shutdown last spring, there was a clear need for major stimulus. Both parties united to pass an effective and much-needed response. 

The U.S. gross domestic product saw a 33.4% surge in the July-September third quarter of 2020, after plunging 31.4% in the April-June second quarter. The economy continued to grow at a 4% rate in the fourth quarter, and the stock market (despite COVID) ended 2020 with the S&P 500 index up 16% for the year as a whole. 

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Former California GOP Chairman Lists Nine Ways America Is Moving Towards Socialism

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by Nick Givas   Former California GOP Chairman Tom Del Beccaro listed nine ways in which America is moving towards socialism during an appearance on “Fox & Friends” Monday. Del Beccaro said increased government spending and inflated tax codes are just the beginning and claimed they’ll have a domino effect on the rest of the country. “We do have massive [spending],” he said. “We are going to spend $7.6 trillion as a society in this upcoming year which is roughly four times what Reagan’s era spent when he said government was the problem.” “We have massive tax systems,” Del Beccaro continued. “And hallmarks of socialist societies are poor incentives where there is weak economic growth. And that comes from tax systems. Trump did a good job beginning with the business tax code. He’s got to do better with personal so we have better growth.” He then moved to reduced economic growth through government interference and cited the EU as a prime example. “[The EU] had zero economic growth over the last 20 years and government is about 60, 70 percent of their economies,” Del Beccaro said. “In the United States we’re about 36 [percent]. With regulations closer to 50. Our growth has slipped…

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Venezuela’s New Currency Does Little So Far To Stabilize Economy

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Nicolas Maduro

by Hanna Bogorowski   Venezuela introduced a new currency on Aug. 20 as a hopeful solution to the country’s rapidly devaluing currency and skyrocketing inflation rates, but after just a few weeks, Venezuela is already seeing 100 percent inflation. The Venezuelan government issued the new currency, called the “sovereign” bolivar, to replace the “strong” bolivar, NPR reported on the day of the rollout. The new bolivar is worth about 100,000 of the old bolivars, and is pegged to the government’s cryptocurrency, the petro. The Bloomberg Cafe Con Leche Index revealed Thursday that the price of a cup of coffee has risen to 50 bolivars. For comparison, 50 of the new bolivars is 5 million of the old ones, after President Nicolas Maduro removed five zeros on July 25 in an effort to stabilize the economy and simplify transactions. The annual inflation rate is now hitting over 100,000 percent. Venezuela is currently suffering through a five-year crisis that is leaving it with a collapsed economy, hyperinflation and a complete breakdown of public goods and services, including deteriorating roads, food shortages, disturbing water cleanliness, failed electricity, high crime and a lack of adequate medicine for the sick. The conditions in Venezuela are causing mass migration flows out of the…

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