The U.S. Government announced today that inflation rose 8.6% in May; highest reading since 1981. The yield on the two year Treasury Bills surged to 2.9%:
(A note to readers)
When I started this inflation watch website, I was only planning on posting once, or maybe twice, a week. Now, events may require more frequent reports. However, readers should not count on more frequent updates.
What I have been concerned about this past year now seems to be unfolding faster than originally anticipated. I have been concerned about both the growing National Debt, and the money printing by the Federal Reserve.
The Federal Reserve should have begun raising interest rates years ago, I believe. The U.S. Government’s recent Three Trillion Dollar Deficit together with the GOP’s recent rich man’s tax cuts have added jet fuel to the stock market and real estate bubbles.
Members of Congress have been unwilling to tackle the problem of the funding required for a vibrant economy. They are passing the fiscal and monetary problems onto the backs of future generations. Our children, and grandchildren.
My premise for starting the Web Site has been that the Fed’s Easy Money policies since 2008 and the GOP’s tax cuts have contributed to a massive economic bubble, which was going to be punctured by some “black swan” economic event.
That “black swan” event has now occurred. It is, of course, Russia’s brutal war in Ukraine and the related spike in Energy and Food costs.
Today’s announcement of a record increase in the consumer price index (CPI) to 8.6% has sent shock waves into the stock and bond markets. Not talked about yet is the parallel implosion of China’s bubble economy.
I cannot give investment advice for this is an educational and entertainment website, but I think readers could look back at 2000 and 2008 for some guidance.
It is my humble opinion that 2022 may be one of great difficulty for investors. So, be alert.
As Mark Twain has reportedly said: “History does not repeat, but it Rhymes.”