Posted on 04/28/2024 12:35:00 AM PDT by RomanSoldier19
Slower growth and rising inflation has brought back distant cries that stagflation is coming. This would force interest rates to stay higher for longer, putting pressure on US businesses and consumers. One investor says anyone looking to hedge this risk should focus on fixed income.
A pair of economic reports has brought back a word no central banker ever wants to hear: stagflation.
The difficult scenario occurs when inflation rises and growth stalls, a dangerous combination just experienced by the US economy.
Worries emerged when Thursday's first-quarter GDP reading slumped against expectations, growing at an annualized 1.6% rate. That's a considerable slowdown from previous quarters, and falls well under estimates of 2.5%.
(Excerpt) Read more at msn.com ...
The most anti business administration in US history plus raised rates plus elevated oil prices-
a growing economy at all is amazing.
Another oil price shock would do it.
That’s the lesson from the 1970’s.
And the lesson from the 1980’s is oil price declines gives you disinflation.
What doesn't lie are the numbers one sees at the gas pump and the grocery store. I'm not sure they make a word that describes what middle America must be feeling in the wake of a financial 30% "haircut", while illegals are being treated like royalty.
They exist for the Drive Time and MSM news cycle. Spew out BLS lies and tell Americans things are “looking up” right after they’ve filled their tank or been shopping, etc. Give’em a little hope that gets quietly dashed when the numbers are ‘corrected’ quietly a little while later.
Abject dissemblers and liars. No matter how you report on what commodity ‘going down’, ‘getting better’ or new jobs increasing, wages increasing, etc., THE MONEY GOING OUT OF AMERICANS’ POCKETS is going up for the same things they buy/get.
Stagflation already here.
experts.....again!
Amazing indeed. It is also amazing that anyone still takes seriously the phony economic pronouncements coming from our utterly corrupt federal government.
BTT
I would agree with you but there is ONE major difference between then and now, we weren’t 30+ trillion dollars in debt in the Reagan Era.
We’ve had an inverted yield curve for quite a few months, which has caused the Biden Administration to finance the national debt with short term treasuries, the debt is horrible now, but a spike in interest rates that is sure to come will cause the debt to explode even more, which means a new Trump administration will inherit a disaster and limit what he can do in the short term.
All too true. Yet who better than Trump to navigate through a disaster? Of necessity, major cuts in federal spending will not just be necessary but also may be broadly acceptable to the country. Trump at least has the right instincts: protect politically popular federal spending like Social Security and Medicare but cut other programs, at least for a start.
This is all part of Cloward-Piven. The Biden Administration is moving as fast as they can to remove as much money from the US economy as they can, while overburdening our justice system with releasing criminals back into the general populace, actively and publicly promoting anti-American activities and destroying industries by regulating them out of existence.
If anyone thinks we are actually defending Ukraine, they are sadly mistaken. Billions are being sent “somewhere” with no accounting or auditing of where the funds are going and how they are actually being used.
All true, the one major part I worry about is in order to enact major cuts to spending, which is required, you need an agreeable congress, even if Republicans take control, I have little to no faith in their ability to put thru major cuts to spending.
As for spending cuts being broadly acceptable to the country, that is probably right, but it was broadly acceptable to not keep funding the war in Ukraine or pass FISA renewal, but Republicans did both by a large majority, meaning they went directly against what their voters wanted, which is one of the reasons why I’m very skeptical on their ability to rein in spending.
When the debt limit is raised next year it will continue to add inflation and an overall sluggish economy for years.
You know Xiden will sign it.
You know Johnson will sign it.
You know McConnell will sign it.
The only realistic way to slow it down will to be remove all these commies from office. Trust the GOPe at your own peril.
In a perfect world Trump will smack Johnson or the new GOPe house leader silly, Gobbler does indeed quit the senate with a new conservative leader. If one thinks we have the cash to send $60,000,000,000 to Ukraine just for one example, or welfare to 10 million illegals and the like the public proves once again it is smart a pet rock.
The spur of dire necessity and the presidential “bully pulpit” could give Trump the upper hand.
Stories like this, about looming recession and stagflation, are simply to obscure the fact that we have been in a recession with stagflation for years at this point. I warned family this was coming once the government started distributing “free” money during the COVID coup flu; we are paying the price for that rapid devaluation of the dollar. The $20/per hour minimum wage for CA fast food workers is an acknowledgment that they’re now working for half the real wages they earned before - and the push to increase wages everywhere is seen as the only way to get Americans spending again. On top of that, payroll taxes (especially Social Security) can be increased (in the case of SS, on both employers AND employees), and some low-wage workers can be “priced out” of the freebies for which they previously qualified at a lower wage.
The experts are incredibly optimistic.
In less than two years their predicted stagflation will look like economic nirvana compared to the reality.
Wrong - stagflation is a recession without a decrease in prices.
Having lived through the stagflation in the late 1970s and early 1980s I see the same situation today. My wife and I purchased our first home in 1979 with a 11.25% 30 year mortgage. Within months mortgage rates were over 15%. Double digit mortgage rates are again around the corner.
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