The Bureau of Labor and Statistics (BLS) releases the inflation numbers for July [LINK HERE] showing massive U.S. inflation continues to crush the working class.  Massive increases in domestic food staples (+10%), energy (+23%) and regular unleaded gasoline (+43%) are hitting the middle-class exceptionally hard [See Table 2].

No middle-class Americans are having their wages increase even close to the scale of price increases for basic purchases.  This outcome results in massive drops in “real wages” (wages minus inflation), and eliminates disposable income entirely.  These outcomes are not due to COVID-19 or any recovery therein.  These outcomes are a direct result of Joe Biden economic and monetary policy. {Go Deep – and – Go Deep}

The White House responds to inflation by saying the Biden administration is attempting to directly subsidize the middle-class inflation they are creating by giving Americans money to pay for higher prices through COVID bailouts.  Yes, the administration admits they are exploding the dependency state, WATCH:

The White House solution is to create dependency on the government for income.  This is exactly intended as government subsidies are used to keep the pitchforks at bay and simultaneously keep people dependent on government to sustain themselves [expand the political base].

Also, please understand when they say “inflation is transitional” or “inflation will spike and then come down to normal levels” what they are saying is that prices will massively increase right now, and then normal or slow price increases will return next year.  This does not mean prices will come down, ever; a key distinction.

Inflation is the comparative measure of price increases now compared to a prior time (last year), usually expressed as a percentage.  Ex. A lemon cost $0.49 cents last year (2020), and jumps to $0.89 cents this year (2021).  The lemon may only jump to $0.99 in 2022 (.10 more) and that is significantly lower inflation, but the price spike is perpetually built in.  The same is true for gasoline, electricity, energy, etc.

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Repost from June by Request – Several people have written to CTH for an economic review of our current status. Below this post are two primary precursor articles [Primary One and Primary Two] which outline the economic dynamic in play, and how we can look forward with accuracy to what is likely to happen. Despite the deflective talking points by the professional financial pundits, this massive spike in inflation is entirely predictable due to Biden economic policy and Biden monetary policy.

Keep in mind, the FED already said in April they would “support inflation”, that’s because – while they will not say it openly, they know there’s no way to stop it. The massive inflation is a direct result of the multinational agenda of the Biden administration; it’s a feature not a flaw, and it has nothing whatsoever to do with COVID. Also keep in mind the first group to admit what is to come are banks, specifically Bank of America, because the monetary policy is the cause.

There’s no way around this. Despite the pundit and financial class selling a counter-narrative, home prices will crash and unemployment will go up. I know this is directly against the current talking points, but the statistical reality is clear. CTH was the first place that said months ago that new home sales will plummet, that is starting to happen right now. There’s no way for it not to happen, the big picture tells us why.

You might remember, when President Trump initiated tariffs against China (steel, aluminum and more), Southeast Asia (product specific), Europe (steel, aluminum and direct products), Canada (steel, aluminum, lumber and dairy specifics), the financial pundits screamed at the top of their lungs that consumer prices were going to skyrocket. They didn’t. CTH knew they wouldn’t because essentially those trading partners responded in the exact same way the U.S. did decades ago when the import/export dynamic was reversed.

Trump’s massive, and in some instances targeted, import tariffs against China, SE Asia, Canada and the EU not only did not increase prices, the prices of the goods in the U.S. actually dropped. Trump’s policies led the largest deflation in consumer prices in decades. At the same time, Trump’s domestic economic policies drove employment and wages higher than any time in the past forty years. With Trump’s policies we were in an era where job growth was strong, wages were rising and consumer prices were falling.  The net result was more disposable income for the middle class, more demand for stuff, and ultimately that’s why the U.S. economy was so strong.

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On July 4th, a little more than a week ago, the White House made the preposterous claim that holiday food was cheaper than last year. Everyone who buys groceries knew that level of propaganda was unmitigated nonsense and the consumer pricing data released today shows exactly that.

According to the BLS, June prices jumped 0.9%. Every month this year the CPI has been rising faster than the prior month, which essentially means inflation is rising at an ever-increasing rate. Annualized inflation (June 2020 -vs- June 2021) now shows an overall inflation rate of 5.4%.

However, at a 0.9% monthly rate -if the level stabilizes- that means the real inflation rate is 10.8% Yeah, that’s a serious problem.

The BLS data (see table 7) shows that gasoline has doubled in price year-over-year. Unleaded regular gasoline is now 46.4% higher than last year. That level of fuel price increase is crushing the working class and blue collar workforce.

Inflation overall is currently rising three to four times faster than wages. That means real wages are dropping as Americans are paying more for everything, including fast turn consumable products like food and fuel. Again, we repeat… durable good sales will suffer as disposable income shrinks. Additionally, rising housing prices combined with diminishing blue collar wages is an unsustainable trend.

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CTH has said repeatedly the road to serfdom is cemented with the catch-phrase “a service driven economy.”  The June jobs report from the Bureau of Labor statistics [BLS LINK]  highlights the JoeBama economic policy exactly that way.

Approximately 850,000 jobs were gained in June; however, simultaneously the number of long-term unemployed increased by 233,000 to the current state of four million.

While we should expect to see the leisure and hospitality industries as well as education rebounding from the various COVID-19 shutdowns, and indeed they did ( +343,000 and +155,000 respectively), manufacturing was flat (+11,000), and construction was down -7,000.  The details inside the data are not as great as the top-line would presume.

CTH looks at alternative data connected to the overall economy; empirical data and sector specific trends inside industry.  The biggest domestic issue is inflation, stunningly large increases in prices for fast-turn consumer goods like food and fuel.  Inflation is one of the primary reasons we have stated home values and home sales have peaked on a MACRO level despite the massive amount of real estate investment purchasing underway by financial institutions.

When we look at durable good production, we focus on the primary drivers of higher cost middle-class or working class products.  Seeing construction jobs decline by 7,000 at the same time real-estate values are increasing only points to the problem of working class not being able to afford new home purchases.  In the real estate sector this is unsustainable; it is simply a matter of math, income stability and wages.

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White House spokesperson Jen Psaki had a great solution to the massive increases in gasoline prices, shut-up and eat more hot dogs.

https://youtu.be/ytjzGMEhmuQ

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President Donald J Trump returns to the U.S-Mexico border in Texas.

Full video of speech below, but first the intro a little fun video/audio mix (turn up volume) which includes Liz Harrington, Steven Miller and Dan Scavino arriving with President Trump and Texas Governor Greg Abbott at the partially completed border wall Joe Biden abandoned. [Rumble Link]

https://rumble.com/embed/vgngs5/?pub=4

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Here’s the video of President Trump’s remarks at the border wall with Texas Governor Greg Abbott:

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In a statement released yesterday President Donald Trump reaffirms his intention to campaign against Alaska Senator Lisa Murkowski next year.  As President Trump notes the energy policy of the Biden administration is directly against the interests of Alaskan residents; yet, Murkowski does nothing to protect her constituents.

PRESIDENT TRUMP – “Senator Lisa Murkowski has cost the great people of Alaska billions and billions of dollars by voting for Radical Left Biden appointees, which in turn led to the revocation of ANWR drilling, which Alaskans have been fighting to see happen for six decades. Not only did Murkowski kill the biggest economic stimulant for the State, but also one of the biggest energy producing sites in the world.

Nobody thought ANWR could be opened. We got it done, and she allowed it to be killed. She’s the best friend Washington Democrats ever had—and Alaska’s reward for that betrayal is an empowered Left coming after their wealth and jobs. I think she will be met very harshly by the Alaska voters in 15 months, and I will be there to campaign against her!”  (LINK)

This is the third time President Trump has advocated for the primary removal of Murkowski.

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PRESIDENT TRUMP – “With Memorial Day Weekend coming up, tomorrow people start driving in the biggest automobile days of the year. I’m sorry to say the gasoline prices that you will be confronted with are far higher than they were just a short number of months ago where we had gasoline under $2 a gallon. Remember as you’re watching the meter tick, and your dollars pile up, how great of a job Donald Trump did as President.

Soon Russia and the Middle East will be making a fortune on oil, and you will be saying how good it was to have me as your President. Wasn’t it great to be energy independent, but we are energy independent no more. Shame, shame, shame. Other than that, have a great Memorial Day Weekend!”  (LINK)

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Every economic policy of the JoeBama administration benefits other nations at the cost of the U.S. middle class.  If you look at the Biden policy from a position of America’s interests they get everything wrong.  However, if you look at Biden economic policy from a goal to weaken the U.S. and benefit other nations, they get everything right.

This is the exact same big picture dynamic that was present during the Obama era.  The Chicago crew of policy advisors simply hate America and everything she/we stand for.  That element of Obama’s network hates ‘colonialism’, despises the industrial revolution, and abhors free market capitalism.

When Obama said “share the wealth” he wasn’t speaking exclusively toward domestic socioeconomic policy; he was also pointing out that America needed to share wealth with other nations.  This is the ideological alignment between Barack Obama and Osama Bin Laden.  Above all other issues Osama Bin Laden despised the wealth the U.S. carried as a result of the dollar being the international trade currency.  Thus the 9/11 attack was directed at the World Trade Center first, then DC second.

If you accept Biden is an avatar for Obama’s third term, then everything in the economic policy makes sense.   Including this:

“U.S. President Joe Biden will rely on ally countries to supply the bulk of the metals needed to build electric vehicles and focus on processing them domestically into battery parts, part of a strategy designed to placate environmentalists, two administration officials with direct knowledge told Reuters.” (link)

Beyond the hypocrisy of ‘global’ climate change being irrelevant to where the mining takes place (duh), what the administration is doing is letting our mining operations close while importing the same product. This is a continuation of what policies created the “rust belt”.  Then there’s the pesky problem of the cars actually being built in Mexico, not the U.S…. but we need to ignore that part.

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I don’t know much about Glenn Youngkin other than he was endorsed by President Trump.  That said, the Virginia governors race has been a bell-weather for the mid-term elections for quite a while.

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Speaking of Virginia, a recent report shows that gasoline has reached $6.99/gal in the commonwealth.  “Drivers were shocked when they got to the pump at a gas station in Virginia. The price on the pump was $6.999 at a Richmond BP station earlier this week.” (LINK)

What is the gasoline price in your neck of the woods?

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