from Birch Gold Group:
There is a big disconnect between what the White House would like you to believe about the economy, and how most Americans are feeling about it right now.
Some members of the Federal Reserve board, including Chairman Powell, tried to listen to the concerns that a handful of panelists had, and the result wasn’t surprising.
The Fed got an earful during a town hall-type event event recently:
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Higher interest rates together with instability in commodity prices “has a stranglehold on the American agriculturalist right now, which leads to a stranglehold on all of rural America,” said Whitney Ferris-Hansen, who owns and operates J/W Farms and Ranch in Burlington, Colorado.
Here’s a perspective on the stark reality of Bidenomics and its effects American families:
“We’re basically in the midst of a perfect storm,” said Derrick Chubbs, president and CEO of Second Harvest Food Bank of Central Florida in Orlando, Florida, noting increased costs of healthcare, childcare, transportation and insurance, along with groceries and housing.”
This is thanks to the “stranglehold” of high rates and inflation, along with a cooling labor market, according to an executive from Indeed who also commented.
Finally, at the event Powell said the Fed expects to start cutting rates later this year, but only once they feel they have inflation under control. (Which could take a while longer.)
So let’s take a deeper look into what all of this could mean…
Watching the economic storm through rose-colored glasses
A recent article contrasted on-the-ground reality with the White House message that “everything is fine”:
President Joe Biden is trying to persuade Americans that the economy is on the upswing, and he has been touting economic indicators that he says prove it: easing inflation, rising job growth and wages, unemployment near record lows…
We could be generous and grant that’s the view from 30,000 feet (or from the Oval Office).
The reason Biden’s message isn’t resonating is pretty simple. It doesn’t reflect the economic reality we’re facing. For example:
Two years of steep inflation has hit working families hard, especially those living paycheck to paycheck.
For those who can’t make ends meet, pawn shops are increasingly filling the gap:
“Pawn balances have risen across the country in the past two years, said Laura Wasileski, spokeswoman for the National Pawnbrokers Association.
The reasons, she said, include “cost-of-living increases, the lack of access to credit, short-term emergencies, and the fact that 50% of American households do not have $1,000 in savings to cover those emergencies.”
Clay Baron, a fourth-generation pawnbroker in El Paso, Texas, is running out of space in his shop.
“When times are good and people have money, there’s going to be more money coming in. People will be buying the stuff,” Baron said. “When people need money, there’s going to be more money going out of the store, which is what’s happening now.”
One customer, Arturo Washington, was less worried about Baron’s inventory glut and more worried about filling his gas tank:
For those of us who are retired, the economy is going very badly… The cost of basic foods is very, very, very expensive. And every day they raise prices more on basic foods. It’s not right.
Not to quibble, and I really don’t intend to downplay Mr. Washington’s struggle – but there’s no shadowy cabal of grocers, no mysterious “they” colluding to squeeze every dime out of struggling families.
Across-the-board rising costs of living increases (inflation) come from dollar devaluation.
The money supply in the U.S. has risen 25% since 2020 – and, remember, more dollars doesn’t translate into more wealth. Printing more dollars instead devalues all other dollars in existence!
