Biden’s Inflation Bedtime Story

May 21, 2024 By E.J. Smith - Your Survival Guy

Seoul, The Republic of Korea (December 6, 2013) Vice President Joe Biden holds a moment of silence to honor Nelson Mandela at the beginning of his speech at Yonsei University. [State Department photo by William Ng/Public Domain]

You have felt the nasty bite of Bidenflation since shortly after Joe Biden began his stay at the White House. Kevin D. Williamson explains in the NY Post that Biden and his supporters are counting on an inflation bedtime story to save Biden in the 2024 election. But the bedtime story, according to Williamson, is a fantasy. He writes:

If you want to know what Democrats are praying for, read the front-page headlines in The Washington Post, e.g.: “Inflation eased slightly in April, with timing for rate cuts still uncertain.”

It isn’t just the timing that is uncertain.

With inflation persistently elevated, it isn’t clear that rate cuts are coming at all for the foreseeable future.

For months, Democrats have been telling themselves a very reassuring bedtime story that plays out in six parts: 1.) Inflation finally will be whipped, at which point 2.) the Fed is going to step in with some well-timed interest-rate cuts, 3.) putting upward pressure on real wages and 4.) lowering rates on mortgages and car loans, at which point 5.) the American people will offer three grateful cheers for Bidenomics and 6.) re-elect the president.

Several of those six developments are not going to happen.

Donald Trump may yet get Joe Biden re-elected, but Fed chairman Jerome Powell isn’t going to save the president from a decades-overdue retirement.

In Wednesday’s monthly inflation report, overall inflation was at 3.4% while “core” inflation — which excludes some volatile commodities such as groceries and gas — was at 3.6% — just under twice the Fed’s preferred rate of 2%.

The usual story that inflation-wary politicians tell to voters is that things are better than they seem because “core” inflation is lower than overall inflation — “You’re in great shape, as long as you don’t have to drive or eat or consume anything that moves on a truck!” — but for Biden the story is reversed: Overall inflation has been partly eased by relatively large declines in food and fuel prices, but inflation for most things people buy is worse than it is at the grocery store or gas station.

According to the Bureau of Labor Statistics, prices today are about 20% higher than they were when Biden was inaugurated in January of 2021.

Action Line: Your Survival Guy knows from decades of helping people with retirement that most family budgets are not prepared for a 20% price increase over three years. When you want to talk about your retirement and what inflation will mean to you, I’m here. In the meantime, click here to subscribe to my free monthly Survive & Thrive letter.

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E.J. Smith - Your Survival Guy

E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. His focus at all times is on preparing clients and readers for “Times Like These.” E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zildjians. He grew-up worshiping Neil Peart (RIP) of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West (RIP JB) and Paris. Please get in touch with E.J. at ejsmith@yoursurvivalguy.com To sign up for my free monthly Survive & Thrive letter, click here.

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