Price Increases at Retail Level Accelerating, Thanks to Massive Money Supply Increase

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The U.S. Bureau of Labor Statistics reported on Friday that prices at the retail level in August increased at an annual rate of nearly five percent in August. Retail prices dropped when the shutdown began and demand for retail items such as gas and services such as restaurants fell like stones. People nearly stopped buying, preferring to stash their “stimulus” checks from the government in savings or use them to pay off credit card debt.

Producer and Consumer Prices Jumped in July Much More Than Expected

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Prices for goods and services at both the producer and the consumer levels jumped far above forecasts in July. The CPI jumped 0.6 percent (an annual rate of more than seven percent — double the rate economists had predicted and the biggest monthly jump since 1991), while the PPI clocked in at 0.8 percent (an annual rate of nearly 10 percent).

Economy Rebounding; Stocks Setting Records

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Bookings for durable goods orders — those designed to last at least three years — jumped another 7.3 percent in June, following May’s 15.1-percent surge. Economists were expecting a 6.9-percent increase. Behind the jump were orders for motor vehicles and parts, which leapt 85.7 percent in June following May’s 28.8-percent gain.

Who’s Running the Show: the Fed or the U.S. Treasury?

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Scott Minerd, global chief investment officer at Guggenheim Partners, told CNN on Tuesday that the next effort by the Fed to keep the U.S. economy going will be to start buying U.S. stocks. As The New American has reported, the Fed has already expanded its powers so that it can purchase exchange-traded bond funds, junk bonds, and now corporate bonds.

Retail Sales in May Set All-time Record High

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Recently freed from government restrictions, edicts, and mandates requiring them to stay at home to limit the spread of the COVID-19 virus, consumers flocked to malls and auto and electronics stores to make up for lost time.

Fed’s Gloomy Outlook Sinks Stocks

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Federal Reserve Chairman Jerome Powell’s assessment that the surprisingly favorable jobs report last week was likely a one-off blip is pushing stock prices lower on Wall Street on Thursday. Following the meeting of the Federal Open Market Committee on Wednesday, Powell said that last week’s report “was a welcome surprise. We hope we get many more like it, but I think we have to be honest, that it’s a long road.”

Will Coronavirus End the Fed?

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September 17, 2019 was a significant day in American economic history. On that day, the New York Federal Reserve began emergency cash infusions into the repurchasing (repo) market. This is the market banks use to make short-term loans to each other. The New York Fed acted after interest rates in the repo market rose to almost 10 percent, well above the Fed’s target rate.

Don’t Panic: the Fed’s Offer to Stabilize Bond Markets Is not “QE-4”

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Headlines from major financial sources virtually shouted that the Federal Reserve was suddenly employing “QE4” — quantitative easing — in a massive way to calm the bond markets roiled by the coronavirus. The Wall Street Journal declared: “Fed to Inject $1.5 Trillion” into the bond market while CNN shouted: “NY Fed to pump in $1.5 trillion to fight coronavirus-linked ‘highly unusual disruptions’ on Wall Street.”

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