By Graham Summers, MBA
Throughout this week, I’ve pounded the table on the fact that the economic data the U.S. government has put out recently is a huge pile of BS.
We’ve covered everything from the jobs data, to inflation, and the recent retail sales results. By quick way of review, the highlights from my research are:
1) The reason the U.S. economy supposedly “added” 500,000+ jobs in January was due to an accounting gimmick, NOT because those jobs were actually created.
2) The Bureau of Labor Statistics (BLS) openly admits this, citing that without its “population control effect” the economy added… 84,000 jobs.
3) The only part of the inflation data that has dropped has been in Energy prices.
4) The reason Energy prices dropped was because the Biden administration dumped over 250 MILLION barrels of oil in the last two years.
5) Retail sales are booming because of INFLATION (things cost more), not because of consumer spending. The jump on credit card debt and massive decline in consumer savings confirms that Americans are maxing out their credit just to get by.
Perhaps the single most disturbing element of the above items is that they reveal the complete failure of the Federal Reserve to tame inflation. Indeed, according to the Taylor Rule which is widely considered one of the best indicators of where rates should be the Fed should have ALREADY raised rates to over 9% to stop inflation.
Instead the Fed has raised rates to 4.75% and is now talking about possibly one or two more rate hikes of just 0.25%.
Everywhere you look, the Fed is failing miserably at curtailing inflation.
1) Financial conditions are now as loose it not looser then they were before the Fed began tightening monetary policy.
2) Meme stock mania is back with garbage companies rallying 30%, 50% even 100% or more in the last few weeks… again just like before the Fed began tightening monetary policy.
3) The inflationary data is being revised upwards: December’s -0.1% CPI report has been revised upwards to 0.1%, November and October’s CPI numbers were also revised higher.
4) The Producer Price Index results for January 2023 were reported yesterday. They showed inflation rising 0.7% month over month. On an annualized basis this puts inflation over 9%.
And all of this is AFTER the Fed raises rates 4.5% and drains over $500 billion in liquidity from the system!
The Fed now has a choice: get serious about ending inflation and trigger a market meltdown… or face a debt crisis in the near future as bond yields roar to new highs, forcing the government to spend more and more money on debt payments.
Either way, the U.S. is heading for a crisis in the near future. And most investors are being lead like sheep to the slaughter!
On that note, we published a Special Investment Report concerning FIVE secret investments you can use to make inflation pay you as it rips through the financial system in the months ahead.
The report is titled Survive the Inflationary Storm. And it explains in very simply terms how to make inflation PAY YOU.
We are making just 100 copies available to the public.
To pick up yours, swing by: