- We know tariffs are coming in, and all forecasters have tariff inflation affecting core CPI inflation.
- Fed Chair Powell
Last Week...
...after the Federal Reserve announced no change in interest rates, he gave his BS on their thinking. The above tag-line is in sharp contrast to Powell's last byline just weeks before. You may recall that he said, "We don't know what will happen with tariffs, with immigration, with fiscal policy, and with regulatory policy."
Let's tell it like it is - from inflation being transitory to the truth that the import deficits get worse and worse with record setting amounts under the liability column each year. Our central and biggest consumer purchase, home sales is at its lowest point in 30-years. Leynette Zange sees excessive debt in all 3-levels: individual, corporation and government. She concludes that a new system is needed or a hyper-inflationary period will arrive. Another little followed economists and investor, Jack Mallers believes another "Nixon Shock" is on the horizon. Our question? Why doesn't Powell address these questions and the role of King Dollar before another crisis arrives? By the way, Powell suggested inflation is still around and that is the primary reason for no rate change. He even mentioned that the inflation rate exceeds our growth rate. We have been saying just that for the past three years. We called it, "Stealth Inflation" because no one else recognizes that if inflation exceeds your growth, you are in stagflation. Powell never addresses this truth. Bottom line: The roots of the Fed is corrupt. Their track record should have them rebranded as, "Boom and Bust Council."Their existence controls our democratic, economic freedom. We conclude, "End the Fed!"
Meanwhile...
retail continues its slow death with a popular chain, Tex-Mex filing for bankruptcy. Red Robin is closing more locations. They are not alone. Manufacturing shed another 13,000 jobs. Keep in mind, the decline in quality work as a percentage of economic value is under 10%. A healthy economy needs at least 40% share in a domestic market. We have a long way to go. However, the economic slowdown has hit Europe's biggest economy. Siemens and Volkswagen plan to cull jobs. They cite automation. Robots are the new competition. Siemens is laying off 6,000 and Volkswagen is doing away with 7,500. They add that it is possible for the number to climb as high as 35,000 over the next five years.
In our unpublished book, we say, "All things are connected." In Germany, the slowdown carries over to auto suppliers and related fields. Companies like Bosch, Schaeffler AG and ZF Friedrichshafen are laying off workers. Siemens says that it will devote more resources into EV charging stations. At the moment, Tesla and China dominate the market. Peace.
