The Biden regime is determined to destroy American equality, liberty, and safety, and they’re accomplishing it through a series of calculated efforts to destroy the middle class.
We noted last month the inflation issues were not going to get better and indeed they are getting worse. The Bureau of Labor Statistics (BLS) has released the latest inflation data, and the rate of inflation continues to increase at an alarming rate; now at 5% year over year for all items.
Everything the Biden administration is doing is making things worse, and now we are seeing big drops in real wages as the inflation rate is far beyond wage growth. Under Biden inflation is massive and wage growth is non-existent. This is an exact reversal of the Trump-era outcome where inflation was low and wage growth rates were high.
Year-over-year price comparisons for regular unleaded gasoline are now +58.2%. [Table 7] Stunning increases in fuel. Natural gas is up 13.5%. The prices of durable goods like furniture are up 9.8% while the prices for washers/dryers have jumped up over 26%. Used car prices are up 29.7%, while every durable good is showing massive increases (appliances, clothes, furniture, jewelry, etc). Even televisions are up almost 5%, after years of continually lower prices.
The May increase in energy prices “was the largest 12-month increase since the period ending April 1980”, over forty years ago. Yes, with 28% increases in overall energy prices Biden is mirroring Jimmy Carter in the outcome of his economic policy (this is not accidental).
Food prices are also skyrocketing. If you have tried to purchase lemons, limes or citrus recently you would know the BLS measure of May inflation for citrus products at 9% is low considering what you are seeing right now. Things are getting worse. [Table 7 Has the Details]
The rapid increases in price for food and gasoline are hitting the middle-class hard. As this continues it will most likely have a downstream effect on more luxury items and durable goods (which also cost more). Spend more on food/gas and you might not be able to purchase that new furniture you wanted. Durable good inventories increase and manufacturing layoffs in those sectors begin.
Despite institutional investors purchasing homes, it will be very interesting to watch how the overall housing market responds over the next few months. If the trendline continues we should see a considerable softening in home sales, again depending on region, as the inflation hits the working class. However, the investment class will swoop-in and purchase homes, turning owners into renters…. Yes, the Great Reset includes exactly this dynamic.
With Biden facilitating the economic plans of the wealthy ideologues and global elites, middle-class Americans are being turned into serfs.
Consumer prices surged higher in May.
The Consumer Price Index rose five percent compared with a year ago, the Department of Labor said Thursday. On a monthly basis, the CPI rose a hotter than expected 0.6 percent
Economists had expected the Labor Department to report that consumer prices rose 0.5 percent in May compared with April. The consensus forecast was for a 4.7 percent gain when measured against May of 2020, which would have been the hottest reading since skyrocketing energy prices pushed up the index in the fall of 2008.
The reading for core inflation, which strips out volatile food and energy prices, was expected to rise 3.5 percent compared with a year ago. That would have been the strongest annual increase in 28 years. On a monthly basis, economists were expecting a 0.5 percent gain.
In Thursday’s release, the government said core inflation rose 0.7 percent. On an annual basis, core inflation jumped 3.8 percent. This was the hottest reading since June 1992.
The index for used cars and trucks continued to rise sharply, jumping 7.3 percent in May. Compared with a year ago, used car prices are up 29.7 percent.
Energy prices were flat, with a drop in gasoline prices offsetting increases in electricity and natural gas. Food prices rose 0.4 percent. The index for airfares rose 7 percent compared with April and is up 24.1 percent compared with a year ago.
Federal Reserve officials and Treasury Secretary Janet Yellen have said they expect this rapid rise in the cost of living to taper off later this year. The year-over-year numbers are boosted by what economists call a base effect, which simply means that the figures are based on gains over prices that were depressed by pandemic shutdowns. In a few months, however, the comparison will be against less depressed prices as the economy began to recover.
Increasingly, however, some analysts fear that inflation could go on for longer and become hotter than expected because of the combination of very low interest rates, pent up consumer demand for goods and services, a particularly large budget deficit, and the release of excess savings built up by stimulus payments.