The “Producer Price Index” (PPI) is essentially the tracking of wholesale prices at three stages: Origination (commodity), Intermediate (processing), and then Final (to wholesale). Today, the Bureau of Labor and Statistics (BLS) released April price data [Available Here] showing another 11.0% increase year-over-year in Final Demand products at the wholesale level.

Last month when looking at internal economic activity that showed a contraction in consumer purchases of goods, we said pay attention to the service side of the ledger now.  Knowing people have stopped buying ‘stuff’, if people are starting to run out of money, they will cut back in the service sector (dining out, etc).

While the PPI focuses on prices, the PPI data for April shows exactly that service side contraction now taking place.  Wholesale inflation in goods is determined heavily by higher costs for raw materials and processing.  However, the rate of inflation within the service sector is more connected to what consumers can afford.   Modified Table-A, look at the April difference between goods (1.3%) and services (0.0%):

[Ex. The lawn company might pay 50% more for oil and gasoline (goods side), but they may not be able to increase the rate they charge you by 50% to mow the grass (service side).]

The major current production inflation in both goods and services is directly connected to the cost of energy.  Energy prices are embedded in every sector of the economy.  For “goods” higher electricity, heating/cooling and petroleum costs (packaging, materials, transportation, etc) are unavoidable and passed on to consumers. For “services,” individuals and companies raise their prices to compensate for increases in their own costs.  It is a cumulative inflation snowball.

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It has often been said that if you chase the global climate change ideology to its natural conclusion, we end up in communal groups sitting around a tepid campfire eating some form of sustainable algae cakes and picking parasites off each other…  Prior to Joe Biden that prediction might have seemed like hyperbole. Now, not so much.

Indeed, the Green New Deal energy policy of Joe Biden creates massive downstream consequences.  Unfortunately, the White House doesn’t seem to care. The high prices and scarcity of critical goods are a feature, not a flaw, as they chase their climate friendly Build Back Better agenda.

Following the continuum of intended consequence, now we have diesel fuel shortages beginning to hit the U.S. economy; and with scarcity comes higher prices of an almost astronomical scale. “The national average price of diesel is now $5.54 per gallon, which is an increase of 22 cents from last week, which was when the most recent record was set. Data shows there’s no state that’s currently seeing diesel prices below $5.12 per gallon.” (LINK)

Making matters even worse is a drop in available inventory of diesel fuel which is about to become a crisis for the east coast of the U.S.  Some Truck Stop operators like Love’s and Pilot are already warning their big rig customers they may not have fuel for truckers.

[…] “Love’s is monitoring the fluid situation on the East Coast, we have experienced minimal outages during low traffic hours,” Oklahoma-based Love’s Travel Stops said in an emailed statement. “The company has no plans to restrict purchases of diesel.”

[…] Earlier on Wednesday, the U.S. government’s Energy Information Administration said total inventories of distillates, which is mainly diesel fuel but also heating oil, fell last week to a 17-year low of 104 million barrels, which is 23% below normal.

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When the satire hits the central nerve of accuracy….

(READ HERE)

Joe Biden was in Chicago today attending the International Brotherhood of Electrical Workers conference.   As he delivered his remarks about the U.S. economy, the installed occupant of the White House started yelling about food boxes and desperate hungry Americans.  WATCH (40 secs):

Perhaps someone should tell Joe Biden that he’s in charge of the economy he is complaining about.  The failures he speaks of are happening under his stewardship.

I know it seems odd, but Joe Biden did this yesterday when he promised in his inflation speech that if people supported Joe Biden as president, Joe Biden would fix the inflation problems Joe Biden created last year.  It all seems rather odd.  And now he’s just yelling about it.

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I’ve been pondering this disconnect for several weeks as the messaging from inside the beltway, including their expressed priorities, seem even more disconnected than before.  The DC bubble has always been present; however, lately the disconnect is even more profound.

Perhaps the increased distance in priorities can be explained by federal politicians cancelling townhall meetings and constituent engagement due to the pandemic. Perhaps politicians are holding party positions disconnected from the population they are supposed to represent because they have spent two years physically distancing from the voters.  Whatever the cause, the disconnect is now more severe.

The contrast is even more significant when it comes to the far-left politicians, because they travel amid a very closed communal tribe where outside opinions are considered toxic to their sense of identity.  The term “safe spaces” was literally coined because leftists cannot handle differences of opinion.

The professional leftist arguments are generally flawed, illogical, antithetical to common values and historically weak.  As an outcome their advocate policy positions are weak and easy to deconstruct when challenged.  To avoid being challenged they rarely hold open discussions with constituents in their districts without extreme vetting measures to avoid confrontation.

Regardless of root cause, most Democrats are severely disconnected from the economic reality of their district citizens.  This is evidenced in a Politico report today discussing the example of Democrat House member Katie Porter of California.

As the article notes, Ms. Porter told the House Democrat Caucus of her experience in the ‘real world’ with people who are grocery shopping.  The perplexed Democrats sat quietly listening to the stories of how price increases for food and gasoline are seriously hurting something called ‘working-class‘ people.

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During a speech filled with obfuscation, nonsense and economic doublespeak, Joe Biden turned to discuss the federal deficit.  During his remarks in Chicago Biden called President Donald J Trump “The Great MAGA King,” as if that would be a bad thing… lol.  WATCH:

https://youtu.be/CUhV4_ciq3Y

We’ve gone from Deplorable, to MAGA, to Ultra MAGA and now The GREAT MAGA.

We shall celebrate our latest elevation with the dance of The Great MAGA King below:

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Senate Democrats wanted to manufacture a political optic using the hot button issue of abortion.  The senate pushed a bill for a massive expansion of abortion, far beyond Roe -v- Wade, to the floor.  However, the bill needed 60 votes to pass cloture, end debate.

Embarrassingly, and in a pure political stunt, Senate Majority Leader Chuck Schumer summoned Kamala Harris to the upper chamber in the event she was needed for a “tie-breaking” vote.  However, cloture requires 60 votes, not 50, so the optics of Harris only highlighted the insufferable politics.

The cloture vote failed 49-51, far short of the 60 votes needed to end debate and attempt to pass the bill.  Democrat Senator Joe Manchin voted with republicans to block the cloture effort.  The federal abortion legislation now disappears back into the filing cabinet from which it came.

WASHINGTON – […] In a 49-51 vote, the Senate rejected the Democratic legislation, with Sen. Joe Manchin (D-W.Va.) and all Republicans voting against the measure. While the outcome was no surprise and mirrored a similar vote on abortion protections the Senate took in February, Majority Leader Chuck Schumer suggested the court’s draft opinion, published by POLITICO last week, had raised the stakes.

“Today’s vote is one of the most consequential we will take in decades because for the first time in 50 years, a conservative majority, an extreme majority on the Supreme Court, is on the brink of declaring that women do not have freedom over their own bodies,” Schumer said in a floor speech Wednesday morning, adding that the decision “will live in infamy.” (read more)

According to Manchin’s earlier statement, “Democrats are “trying to make people believe that this is the same thing as codifying Roe v. Wade. And I want you to know, it’s not,” he argued, referring to the bill’s ban on some state restrictions on the procedure currently allowed. “This is not the same. It expands abortion.”

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The next Democrat and Lincoln Project presidential candidate for ¹2024, Joe Manchin, questions Defense Intel Agency (DIA) Director Lt. Gen. Scott Berrier and Director of National Intelligence (DNI) Avril Haines about whether Ukraine can actually win the current war with Russia.  It’s an interesting exchange because none of the DeceptiCon senators will usually approach the issue.

Lt General Scott Berrier (DIA) says [00:56], “that is a difficult predication to make. I think where the [DIA assessment] is at is a prolonged stalemate should no factor change on either side. In other words, the Russians continue to do what they’re doing, and we continue to do what we are doing for the Ukranians.”  Read that emphasis carefully.

What Berrier is saying is affirming we are in a direct proxy war.  So long as the United States remains the essential fighting force behind the Ukrainian military, they can achieve a stalemate.  However, if the United States withdraws support, Russia will win.  DIA Berrier is saying directly the U.S. can only achieve a stalemate in Ukraine.  WATCH:

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Manchin was not being misogynistic in not asking Haines that question.  Remember, the ODNI is only supposed to be faced internally into the United States security and intelligence operations.  ODNI Avril Haines is a political operative from the Obama administration, specifically implanted into the Office of the Director of National Intelligence, because that specific element of the intelligence apparatus only looks inward into the U.S. citizenry for threats against government.

Please emphasize this point when needed.  The ODNI does not evaluate national security issues abroad. The Patriot Act created the ODNI to set up a threat radar that only looks internally.  We The People are the threat the office of the ODNI was created to evaluate.  Emphasize that as needed.

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The Bureau of Labor Statistics (BLS) released the inflation data from April today [DATA HERE] showing 0.3% increased inflation in April and a continued 8.3% ‘sticky’ inflation year-over-year.

CTH is going to say something slightly unusual, this data is actually worse than expected.   The hidden canary in the mine is within this BLS sentence which shows in the statistics, “the index for gasoline fell 6.1 percent over the month, offsetting increases in the indexes for natural gas and electricity.”  Remember, these are backwards reflections of price captured in early/mid-April.

The actual price of gasoline dropped 1% in April during the timeframe captured.  Yes, there was an actual 18 days in April when gasoline prices moderated and slightly ticked down; however, those prices immediately jumped again late April through today.

Because the BLS puts a 5x weight on the importance of gas [Table A], the 1% temporary drop in gasoline led to 6.1% downward “seasonally adjusted” price pressure.

All of that said, and with the heavy weighting of the gasoline prices considered, the net inflation results barely moved from March (8.5%) to April (8.3%). I modified Table-A to take out the noise.  You can see the downward pressure from gasoline and simultaneously the upward price pressure from food, specifically food at home.

This outcome is a reflection of what we have been seeing in the supermarkets and grocery stores.

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In an unusual incumbent vs. incumbent Republican House primary – due to West Virginia losing a House seat, West Virginia’s CD-02 has become a “near-perfect distillation of the split in the G.O.P., with Representative David B. McKinley, who is soft spoken and intent on getting things done, facing a more hard-edged, Trump-aligned ideological candidate, Representative Alex X. Mooney,” according to the New York Times.

Despite the McKinley advantage because the redrawn district is considerably more McKinley than Mooney territory, it looks like Trump-Endorsed Alex Mooney is going to win.

NYT Election Center

Politico Election Center

CNN Election Center

UPDATE:  Mooney Wins – President Trump now 56-0 with 2022 endorsements

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