Fannie Mae forecasts a “modest recession in the latter half of 2023” and believes the house-buying frenzy will begin to cool in the US. The Federal Reserve’s hawkish direction to curb inflation has led the agency to believe that a “soft landing” for the US economy is unlikely.
“With the most recent inflation readings at levels not seen since the early 1980s and wage growth exceeding that which is consistent with a 2-percent inflation objective, we believe the odds of a soft landing are even lower. Returning to the Fed’s policy target, therefore, likely necessitates economic growth slowing sufficiently to lead to a rise in the unemployment rate, which would cool wage and price pressures.”
Naturally, they see mortgage rates rising. Home sales for 2022 are now predicted to decline 7.4% compared to their initial forecast of 4.1%, while sales in 2023 are expected to decrease by 9.7% (initial projection: 2.7% decline). Adjusted for inflation, Fannie Mae sees house price growth approaching 0% by the end of next year.
Mortgage credit is not a factor as it was during the Great Recession and the checks and balances are in place after the 2008 scare. New construction is also expected to help with the “eventual recovery” as there is a lower inventory relative to demographic demand. Mortgage rates are now hovering around 5% after rising 1.95 percentage points since the December low. A similar spike in mortgage rates occurred in 2013 and 2018 and led to a downturn in home sales.
Interestingly, Fannie Mae has specified that the coming “modest recession” is “COVID-driven” and even admitted that the business cycle is at play:
“We have previously posited that the current business cycle would likely be shorter than those of the past few decades. GDP growth surged in 2021 after the relaxation of many COVID restrictions – also supported by historic income transfers and monetary policy easing – which led to a swift recovery but also planted the seeds of inflation. Therefore, despite only two years having passed since the COVID-driven recession of 2020, the economy has already moved into what could be described as the mature stage of the business cycle. Specifically, the unemployment rate is below the “full employment” level, inflation is accelerating as growth slows, and the Federal Reserve is beginning to tighten policy. These conditions typically mark the beginning of the end of an economic expansion.”
Posted originally on the conservative tree house on April 21, 2022 | Sundance
The multinational Disney corporation decided to target conservative lawmakers in Florida after the legislature passed a bill to stop the sexualization of children K-3 in public schools.
Florida Governor Ron DeSantis called for the legislature to consider the removal of Disney World’s special district status in a previously scheduled special session.
Today, the Florida Senate approved a bill to revoke Disney’s ‘special district’ status in the Orlando area.
(Via Wall Street Journal) – The Republican-led Florida Senate passed a bill Wednesday that would eliminate a special tax district that allows Walt Disney Co. to govern the land where its theme parks sit, as lawmakers target the company for opposing legislation restricting classroom instruction on gender and sexuality.
The GOP-led House will likely vote to approve the measure Thursday. Republican Gov. Ron DeSantis, who called for lawmakers to consider such a bill in a special session he convened this week, has made clear he would sign it.
Losing the nearly 40-square-mile district near Orlando could be a major blow to Disney’s Florida operations.
[The special district] allows Disney to construct new buildings and expand its parks without having to adhere to state or county regulations related to construction, wastewater management and drainage. It encompasses four theme parks, two water parks, a sports complex and hotels, stores and restaurants. (read more)
Posted originally on the conservative tree house on April 20, 2022 | Sundance
The German government released their version of the producer price index for inflation, and they are reporting 30.9% inflation for products leaving German factories. [DETAILS HERE] That’s the highest rate of inflation since shortly after the second world war.
The inflation rate is being driven mostly by energy costs which are more than 80% higher than last year. However, each nation’s overall inflation rate is also driven by the amount of central bank spending they used during the COVID economic lockdowns. The more any govt spent on subsidies, the more money they printed, the more they devalued their money and subsequently, the higher their current rate of inflation.
Germany is the largest economy in the European Union. This level of inflation within Germany has major ramifications.
First, with this level of energy inflation Germany cannot afford to stop purchasing Russian energy products. There’s no way for Germany to join or increase western sanctions against oil and gas they need to stay sufficient. Germany is dependent on Russian energy.
Second, with Germany’s economy this vulnerable; and with Germany being so dependent on Russian energy; Germany will have to distance itself further from any Ukraine assistance. In the background of western voices already being upset with Germany for not providing more support for Ukraine, their economic vulnerability explains their unwillingness. The U.S. proxy war against Russia does not benefit Germany, at all.
Third, as a result of the first two points, Volodymyr Zelenskyy will be even more mad than he was yesterday. Additionally, the German position makes Biden more vulnerable because it forces the U.S. to take a bigger public footprint on the entire operation. This explains why the people in the background of the White House are saying Ron Klain needs to quickly extricate Biden from his unilateral focus on Ukraine.
If the White House doesn’t cut Zelenskyy loose soon, the anchor of fail Ukraine represents will further sink Biden. Sooner or later the White House, Administrative Deep State, Dept of State and Intelligence apparatus along with the total foreign policy establishment and all the politicians who benefit financially from their use of Ukraine, are going to have to give up.
With countries like Germany needing to back away, it becomes harder for the Biden administration to retain the false front around NATO as a justification for their intervention and money laundering operations.
Additionally, if the French election goes to Le Pen on Sunday, well, katybar the door – because it’s complete and total game over…. Ukraine will be cut loose and someone from the CIA will assassinate Zelenskyy on the way out, leaving a note on the nightstand that says, “Putin did it.”
GERMANY – German annual producer price inflation topped 30% in March, the country’s Federal Statistics Office said on Wednesday. That’s its highest level since the agency began collecting data 73 years ago.
The biggest culprit? Energy prices, which rose nearly 84% from the same month last year. “Mainly responsible for the high rise of energy prices were the strong price increases of natural gas… which was [up] 144.8% on March 2021,” the statistics office said in a statement.
It is one of first signs of the huge impact Russia’s invasion of Ukraine is having on the German economy, Europe’s biggest. Producer prices rose by nearly 5% between February and March alone.
Consumers should brace themselves. Factory gate inflation feeds into retail prices, and shoppers can expect to spend more on everything from furniture to meat, according to Wednesday’s figures.
German consumer price inflation is already at a 41-year high, hitting 7.3% last month. Energy prices were the main contributor, up almost 40% from the previous month. (read more)
You may have heard the insane notion that math is fundamentally racist. Equitable Math, a group aiming to make numbers less prejudiced, has noted that its largest founder is none other than the Bill and Melinda Gates Foundation. The Gates Foundation also funded the initiative “Dismantling Racism in Mathematics Instruction” by the Education Trust-West, which has merged critical race theory with mathematics. “A Pathway to Equitable Mathematics Instruction” has been distributed to schools across America with the aim of “dismantling racism in mathematical instruction.”
How is math racist? One of the workbooks funded by Gates explains: “The concept of mathematics being purely objective is unequivocally false. Upholding the idea that there are always right and wrong answers perpetuates ‘objectivity’.”
The theory that minorities cannot understand mathematics is inherently racist, and the people promoting its use are mainly white liberals with hidden superiority complexes. Equitable Math notes on their website: “Students can arrive at the right answer without understanding the bigger concept; or they can have an “aha” moment when they see why they got an answer wrong.” Is this a deliberate attempt to dumb down American students? It is no secret that the West lags behind the East when it comes to mathematics. Perhaps this absurdity will be yet another reason that the East will dethrone the West as the financial capital of the world.
Armstrong Economics Blog/Technology Re-Posted Apr 20, 2022 by Martin Armstrong (YOU MUST WATCH THE VIDEO AT THE END OF THIS POST)
QUESTION: I’m just curious. President Jimmy Carter said that he saw a UFO which was reported by the Associated Press in January 1978. There are countless reports of UFOs for decades. Some say they have been around for thousands of years. Does Socrates have any ability to confirm or deny such things?
FG
ANSWER: I do not see how Socrates could confirm or deny the existence of UFOs. The modern event that began the flying saucer sighting was Kenneth Arnold who reported seeing several metal objects flying in excess of 1200 MPH on June 24th, 1947. I had an uncle who was in the Air Force during World War II and during the Korean War. He told me when I was a kid that saucers would fly in circles around the planes observing what was taking place. A friend who was a pilot during the Korean War said the same thing.
On Saturday night, July 5, 1947, a rancher named W.W. “Mac” Brazel had debris from what became the Roswell Incident. On July 8, 1947, RAAF public information officer Walter Haut issued a press release stating that personnel from the field’s 509th Operations Group had recovered a “flying disc”, which had landed on a ranch near Roswell. During that summer of 1947, it was also the dawn of the Cold War. The U.S. Army Air Forces made a press release announcing that they had recovered a “flying disc” from a ranch near Roswell. Here some 75 years later, the incident remains a defining aspect of the area’s identity. Roswell has a UFO museum and research center. There is even a flying saucer-inspired McDonald’s as well as alien-themed streetlights.
But behind all the UFO mania lies an uneasy truth. The events that transpired that summer are anything but clear-cut, with admitted coverups and conflicting explanations: It was a saucer! It was spycraft! It was the Soviets!
President Jimmy Carter said he saw one in 1969. It is hard to explain so many sightings were always some fictional account. I believe there is overwhelming evidence that sightings have existed for thousands of years. The question is rather straightforward. Are these aliens or are they time travelers from our own future? The physicist Stephen Hawking said in his book “Black Holes and Baby Universes” (Bantam, 1994), “The best evidence we have that time travel is not possible, and never will be, is that we have not been invaded by hordes of tourists from the future.” That seemed to be a comment more in jest.
Albert Einstein’s theory of special relativity proposed that time is an illusion that moves relative to an observer. An observer traveling near the speed of light will experience time, with all its aftereffects (boredom, aging, etc.) much more slowly than an observer at rest. It was suggested that the astronaut Scott Kelly aged ever so slightly less over the course of a year in orbit than his twin brother who stayed here on Earth.
Well, there has been a rash of UFO sightings by US Navy pilots recently once again. Do they come to visit from the future during periods of war to observe? Believe it or not, three US senators were given a classified briefing about UFOs which have been seen traveling at hypersonic speed by US Navy pilots in 2019. It seems the story has hit several sources including Politico.
A spokesperson for Sen. Mark Warner, the vice-chairman of the Senate Intelligence Committee, has confirmed that he was present at the briefing and made a public statement. “If naval pilots are running into unexplained interference in the air, that’s a safety concern Senator Warner believes we need to get to the bottom of.” I find this curious for is someone observing us before we go into war?
My uncle who was a Navy pilot during the Korean War over the Pacific said that the pilots would often encounter UFOs back then as well. Indeed, there were reports carried out in 1947 and 1949, and then there was the major incident of 1952 UFO sighting which was a series of the unidentified flying object reported from July 12 to July 29, 1952, over Washington, D.C. These were perhaps the most publicized sightings that took place. The History Channel covered the story. The radar operator Howard Cocklin did an interview before he died.
Back in the early 1980s, there was a major sighting of a UFO which streaked across the sky from Princeton, New Jersey out past Trenton and off to the shore. New Jersey has actually been one of the hot spots where UFO sightings are far more common.
I actually saw one of these saucers take off when I was late and cut through a field trying to get to a party with a girlfriend in the late ’70s in Princeton. There it was, sitting in a field, and as soon as my lights got close it took off with such blinding light I had to slam on the breaks. There was absolutely no sound – just white light. My girlfriend said we had to call the press. I told her no way, I was a businessman and I could not get involved. The next day, the front pages of the Trenton Times reported thousands of people calling in about a UFO which streaked across the sky.
I found three things very curious. First, I had long been told that out by that field there was a secret base underground that the government had constructed so why would such a vehicle be just sitting in a field near this base? Secondly, the blinding white light and the absence of sound meant the engines had to be magnetic rather than a combustion fuel. The third strange aspect was that it abruptly went straight up, stopped dead, and then made a right horizontal turn at incredible speed. This meant that there had to be some gravitational technology for no occupant could survive such G-forces.
Personally, I find it less likely that someone from another planet visits here and never makes contact given the distance. On the contrary, someone from the future visiting the past but not making contact to prevent corrupting the timeline might be more probable. Since what I saw made no sound and the two forces I studied in school were electrical or magnetic where we only adopted the first, perhaps Climate Change/pollution forces the adoption of magnetic engines in the future. But could a magnetic engine function interstellar or would it be only functional close to the planet?
That said, TIME to me clearly travels in waves as does light itself, but at the same time light also appears to be particles. Michele Angelo Besso (1873–1955) was a close friend of Albert Einstein during his years at the Federal Polytechnic Institute in Zurich. When Besso died in Geneva, aged 81, Einstein wrote a condolence letter to the Besso family. Albert wrote “Now he has departed from this strange world a little ahead of me. That means nothing. For us believing physicists the distinction between past, present, and future only has the meaning of an illusion, though a persistent one.”
For decades, the Department of Defense sponsored secret studies of psychic phenomena in hopes of training an elite team of psychic soldiers. There are people with psychic abilities and others who have even contacted people who had previously died. Some have described we go to heaven or hell upon death and other religions believe were are sent back here for another tour of duty until we get it right and can stay in another dimension they call Nirvana.
Despite the propaganda against non-Christian religions being pagans, as I have mentioned before that neither the Greeks nor the Romans saw all their “gods” as creators. They were more like some Marvel superhero who was there to torment you if they felt like it. You would go pray to Poisden not because he created you, but because he was in charge of the sea. You would go to his temple and pray to him for safe passage. It was not the same concept of a God who created everything. Upon death, Zeus could not judge you, he would make a recommendation to the Three Fates who judged you.
The Greeks influenced their later conquerors the Romans in many ways which included their views of the afterlife. The idea of fantastic rewards or horrific torments to come after death was not a Christian theme to impose obedience. Instead, it was a rather graphic view in the writings of the most famous and talented poets of the Roman world. In fact, the great Latin poet Virgil (70-19 BC), like his Greek predecessor Homer, tells the story of a descent to the underworld where Hades ruled which we now call Hell. The Romans believed that the dead would first go to the underworld (Hell) where their souls were judged. If a person was judged to be undeserving of punishment, their soul would go to the Fields of Elysium (Haven). The concept of an afterlife predated Christianity.
In the Middle Ages, many Christians destroyed statutes assuming that each one was some sort of god. In fact, they were more like photographs of a deceased member of a family. Here is what remains of a statue of Germanicus. It was not only beheaded by the Christians, they chopped off its nose and carved a cross on the forehead. Germanicus was the adopted son of Tiberius but he was convinced that Piso’s wife, Plancina, had poisoned him. Gnaeus Calpurnius Piso, whom Tiberius had installed as governor of Syria, was frustrated and seemed to believe he was overshadowed by Germanicus.
Even going further back to Egypt, there is the legend of Osiris who is killed by his brother Set. Plutarch, the Greek historian, tells us that Set conspired against Osiris with seventy-two unspecified accomplices. When people still mourned Osiris, Set had his body chopped up into 42 parts and disbursed around the kingdom. His wife Isis gathers all the parts and restores Osiris’s body, often with the help of other deities, including Thoth, a deity credited with great magical and healing powers, and Anubis, the god of embalming and funerary rites. Osiris becomes the first mummy, from which he then rises from the dead. Hence, this is why the Egyptians mummified their bodies so upon last judgment they would rise from the dead like Osirus. However, the missing part of Osiris was his penis, which Isis has to reconstruct with magic because the original was eaten by fish in the river. According to Plutarch, this is the reason the Egyptians also did not eat fish.
This differs from some Egyptian accounts where the penis of Osiris is found intact and is resurrected. Isis then magically becomes impregnated and gives birth to Horus. Then Horus avenges his father’s death. The Osiris legend is perhaps the oldest resurrection story in the ancient world.
Obviously, most religions accepted the idea of an afterlife and some believed in a last judgment and resurrection while some believed you simply went to the underworld or Elysium, and still, others believed you were sent back here until you learned your lessons and no longer needed to go through the cycle of birth, life, and death. The Egyptians would go to great lengths to preserve their bodies for the resurrection.
There is uncanny evidence that TIME is another dimension that flows in regular cycles. The Economic Confidence Model has picked so many turning points right to the day even decades in advance. If TIME were merely linear, then that would be impossible.
To me, I would venture that all of these sightings are not grey men from other planets, but from our own future. Perhaps we may have been visited once or twice by Aliens, but if so we were too primitive to bother with. That is all speculation and people will believe what they want to believe. I am only interested in TIME and for me, I tend to agree with Einstein.
TIME flows like the waves in the ocean. You can count the rhythm between each wave and see the pattern which emerges by just watching the intervals as they crash upon the shore.
Thus, the essence of TIME aside, just maybe these visits are from the future rather than some other galaxy. If so, the parody of Kirk meets Biden might be more on point. Of course, YouTube Removed it for anything that questions the mental capability of their fearless leader of the free world must be silenced.
Posted originally on the conservative tree house on April 19, 2022 | sundance
Jumpin’ ju-ju bones, Governor Ron DeSantis detonated a thermonuclear political bomb on the Disney Corporation today.
A special legislative session has been called to approve the new congressional districting map. However, in an unexpected announcement, the Florida governor said that, in addition to a new congressional map they’re voting on, lawmakers “will be considering termination of all special districts that were enacted in Florida prior to 1968, and that includes the Reedy Creek Improvement District.”
As NBC notes, “The Reedy Creek Improvement District in the Orlando area shields Disney from local government regulations and from local property taxes, which could be worth as much as $200 million per year, by one lawmaker’s estimate. Legislators in both chambers predicted the legislation — which could end the 55-year-old taxing district next summer — would pass by Friday.” WATCH:
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DeSantis knows he has a sky-high approval rating in the state, and he is moving fast while the public still has the cultural antagonism and political weaponization by the Disney Corporation in the headlines.
The Disney Corporation previously announced they were going to fund political attacks against the Florida Legislature for creating laws that protect children from sex predators in schools. Disney openly announced they support grooming efforts by teachers in K-3 education to sexualize children and discuss gender identity issues for children under 9-years-old without parental consent.
Ron DeSantis and the Florida Republican Legislature are about to deliver big revenge against Disney for that decision. In the political, cultural and all things corporate business world inside Florida, the removal of Disney’s special district status is huge.
(NBC , FLORIDA) – […] The prospect of the Legislature taking such a direct shot at Disney, the state’s largest private employer and traditionally one of the most powerful political players in the Florida capital, was unthinkable until the DeSantis era.
“This is a governor who is willing to buck your traditional elite establishment and corporate America,” Florida House Speaker Chris Sprowls said. “And maybe that’s a difference in politics over the last 20 years, but I think that we’re starting to live in this really unique time.”
DeSantis is in a uniquely powerful position as governor. His favorability ratings are so high in the GOP that they rival those of former President Donald Trump’s in Florida, according to polls. If Trump doesn’t run for president in 2024, polls suggest, DeSantis is well positioned to be his heir apparent in two years as an early front-runner for the Republican Party’s nomination.
In a sign of his political clout, DeSantis had already forced legislators back to Tallahassee this week for a special session to rubber-stamp a proposed congressional map he drew after vetoing maps drawn by the Legislature — both unprecedented acts for a Florida governor. (read more)
Posted originally on the conservative tree house on April 16, 2022 | Sundance
In the ongoing public battle over Twitter as a speech platform, one actual user of Twitter, Chris Bakke, wanted to see who exactly these Board of Directors are, who are attempting to stop Elon Musk from purchasing it.
Chris Bakke then noted how little of the actual stock is owned by the company’s Board of Directors. Sans Twitter Founder Jack Dorsey, the combined ownership of the entire board equates to 77 shares of stock, worth around $3,200 bucks.
The Board of Directors [SEE BoD LINK HERE] consists of academics, tech executives, business and policy wonks, and a random baroness who doesn’t even use the service. These are the people who are making fiduciary decisions for all Twitter stock owners without any financial stake in the decisions they make for the company.
BOARD MEMBERS – (2) Bret Taylor, Independent Board Chair; Co-CEO, Salesforce (former Google exec). (3) Parag Agrawal,CEO, Twitter. (4) Mimi Alemayehou, Senior Vice President for Public – Private Partnership at Mastercard. (5) Dr. Fei-Fei Li, Professor at Stanford (former Google exec). (6) Egon Durban, Co-CEO, Silver Lake. (7) Robert Zoellick, Former Chairman of the Board of Directors of AllianceBernstein Holding L.P. (8) Patrick Pichette, General Partner, Inovia Capital; Former Senior Vice President and Chief Financial Officer, Google. (9) Martha Lane Fox, Founder and Chairperson, Lucky Voice Group; Former Co-Founder and Managing Director of lastminute.com; Crossbench Peer, House of Lords. (10) Omid Kordestani, Former Executive Chairman, Twitter (former Google exec). (11) David Rosenblatt, CEO, 1stdibs.com, Inc. (former Google exec). (12) Jack Dorsey, Co-Founder, Twitter; CEO and Co-Founder, Square.
Further evidence the motivations behind the Twitter board have nothing to do with stewardship for their shareholders. Again, this is yet another datapoint highlighting the background structure of Twitter that Musk is exposing.
Twitter is not making a decision to decline the generous offer by Elon Musk because of stewardship or fiduciary responsibility to shareholders. The financials of Twitter as a non-viable business model highlight the issue of money being irrelevant. Twitter does not and cannot make money. Growing Twitter only means growing an expense. Growing Twitter does not grow revenue enough to offset the increase in expense.
There is only one way for Twitter to exist as a viable entity, people are now starting to realize this.
What matters to the people behind Twitter, the people who are subsidizing the ability of Twitter to exist, is control over the global conversation.
Control of the conversation is priceless to the people who provide the backbone for Twitter.
Once people realize who is subsidizing Twitter, everything changes.
Posted originally on the conservative tree house on April 14, 2022 | Sundance
Appearing on Stage in Vancouver earlier today with the head of TED Chris Anderson, Elon Musk discusses why he has made a financial bid to purchase the social media platform Twitter. The video is prompted to 11:40 when Musk takes the stage, the first part of the conversation surrounds the Twitter announcement that had made global headlines only a few hours earlier. WATCH:
Posted originally on the conservative tree house on April 14, 2022 | sundance
The U.S. Census Bureau {LINK} reports the March retail sales data {pdf LINK} showing a contraction in sales overall (excluding gasoline) and a massive contraction in on-line sales. As we expected, we are seeing the continued demand side contraction for non-essential purchases.
First, when you review the data, keep in mind all of the statistics are based on dollars. Currently the BLS calculates the rate of inflation at 8.5 percent year over year. So, when we look at retail sales figures, we must remember the items being sold cost more. Any reported sales figures in a sector that do not exceed the inflation in that sector, indicates decline in units sold.
The top-line for March retail sales is 0.5% growth; however, the rate of inflation is 8.5%, so the amount of goods sold is substantially less than the 0.5% dollar increase would indicate. Subtract the sales of gasoline (w/ massive price increases), and retail sales are negative (-0.3%) in March. SEE TABLE-2
A good category to note the contraction in non-essential purchases is electronics and appliances. Again, CORE inflation in that segment is around 6%, and yet total sales were only 3.3% higher, meaning less actual units sold. Compared to 2021, electronics and appliance sales dropped 9.7%.
Showing how much people are pinched, gasoline prices are around 60% higher than this time last year, yet gas station sales only increased by 8.9%. This means people are buying a lot less fuel at much higher prices. People have shifted their transportation habits because gas costs so much.
Two more very interesting notes:
Food and beverage stores only reflected a 1.0% increase in sales, amid massive inflation in that sector. People are buying less food at higher prices. The year-over-year rate of retail sales increase for supermarkets is 8.4%, however, prices in the grocery store are well beyond 20%. Again, food prices are changing shopping habits. You can see the same trend in Health and Beauty Care products. Consumers are being thrifty and prioritizing their expenses away from non-essentials.
Secondly, perhaps the most obvious shift in consumer spending is noted in on-line (nonstore) retailers. March retail sales dropped 6.4 percent for on-line shoppers, again as a consequence of much higher on-line prices and some product unavailability.
The bottom line of the Retail Sales report is not unfamiliar to us. What we are seeing is a lessening in overall consumer spending, as the costs for food, fuel, energy and housing have skyrocketed. The demand for non-essential purchases is what we would naturally expect to see amid a nation having to make tough purchasing decisions based on inflation.
The economic policy of the people behind Joe Biden is catastrophic, and it appears to be a feature not a flaw.
That said, wise people -including people here- know how to extend their budgets and make use of raw ingredients for multiple purposed meals. Keep doing that as much as possible to offset the dramatic increases in price. Look for sales, use coupons, multipurpose products and be smart with purchase decisions.
We can and will get through this together.
If you have tips for people to assist with lowering costs of everyday items, please feel free to share them in the comments section below. We always find excellent ideas around us for small ways to save.
Coming from a family whose Tupperware® was a matching set of Cool Whip containers, I can tell you there are times when being frugal is a valued skillset. I welcome all the great advice we share as a community, and I will not let these horrible government officials remove joy.
I’ve been broke more than most, but I ain’t never been poor.
Posted originally on the conservative tree house on April 12, 2022 | Sundance
This is not going to be news to CTH readers and intellectually honest analysts. The Bureau of Labor and Statistics has released the March consumer pricing data [DATA HERE] showing the recent surge in energy, gasoline and food costs that we have all felt.
The monthly increase of 1.3% brings the annual rate of inflation to 8.5 percent year-over-year. However, the details tell the exact story we have been outlining for well over six months. This is the second wave of inflation being recorded. Grocery store prices (food at home), energy prices, and gasoline prices are all driving the inflation rate. [BLS Table 1]
Again, I modified Table-1 to take out the noise. The data shows what we have felt for the past two months. Working class families are feeling the pinch as their wages cannot keep pace with the increase in prices on products that are a priority. Food, housing, gasoline, energy.
If we were using the old CPI method for analysis, current inflation would be well above 20%.
That said, there are issues also inherent and visible in the data for the non-food and energy segments, what I would call the durable goods side. First, we are seeing the beginning of the durable good contraction getting quantified as we have previously discussed. The prices for used vehicles, electronics, appliances and other non-critical durable goods are now flatlining, or even dropping in price.
Every indication within the economy indicates this is being caused by a demand contraction. People are not purchasing durable goods because their disposable income is gone. This lack of demand also shows up in wage rate suppression. Despite high employment, wages are not rising – in part because there is excess productivity in the durable good economy.
You will note from Table-2 [available here] that food away from home, restaurant food, is not climbing as high as food at the grocery store (0.3% -vs- 1.5%). Restaurants are trying to keep prices down and their profit margins are being eroded. They are in a tough place, because if restaurants raise prices, they may lose customers who are already feeling pain in their checkbooks. However, they cannot hold out much longer before raising prices, because the price increases are permanent.
The good news is the March data appears to quantify the apex of the second wave rate of inflation. The rate of increase in food, fuel and energy will now start to moderate and slow down. The prices may, likely will, keep going up, but they will go up less dramatically than they have in the past six months. This price plateau will hopefully remain in place until late summer, that’s when the next harvest food costs will hit in Wave-3.
On the durable goods, what we will see now is a typical demand side issue. Price increases for durable goods will quickly, if they are not already, be less connected to material costs and more connected to demand. Obviously, the cost to manufacture, create, produce, transport and deliver durable goods is still experiencing upward pressure due to raw materials. However, the demand variable will now enter more dominantly.
With wage growth meek and prices still rising on essentials like food, housing, energy and gasoline, demand for non-essential durable goods will drop. The demand decline should naturally put downward price pressure on appliances, electronics, used vehicles, etc. Unfortunately, this also contracts the overall economy, creates unemployment, and indicates “stagflation.”
(MSM) – […] The consumer price index leaped 8.5% annually, the fastest pace since December 1981, the Labor Department said on Tuesday, likely cementing Federal Reserve plans for an unusually large half-point interest rate hike early next month. That increase is up from 7.9% in February and inflation now has notched new 40-year highs for five straight months. (more)
We will need to watch the service side closely now to see if consumers start to lessen travel, entertainment, and other service side expenses.
Protect your family. Be frugal, wise and smart with expenses. However, do not trouble yourself with dark imaginings.
If you are like most here, you have prepared yourself with commonsense actions and you are a doer who fixes problems, not a naysayer who sits around mulling over them. Your family, kids and/or grandkids as well as your community can benefit from wise, albeit sometimes stern, counsel. Stand strong, stand firm and stand resolute.
All of these challenges are simply that, challenges. Work any problem as it arises, including for the kids. And also remember, God is in charge, not you. So, listen to his instructions. Listen to that instinct he buried within you. Draw upon the strength that a loving God constantly provides.
Be a vessel for those who need hope. Be a guiding light for those who feel distressed. Be cheerfully strong among everyone around you, and thankful for all the kindness you experience. If you get stuck, start giving….
Ultimately, everything is a choice. So, be the lighthouse, not the rocks.
I have created this site to help people have fun in the kitchen. I write about enjoying life both in and out of my kitchen. Life is short! Make the most of it and enjoy!
This is a library of News Events not reported by the Main Stream Media documenting & connecting the dots on How the Obama Marxist Liberal agenda is destroying America
Centinel2012 