by Peter Schiff, Schiff Gold:
When the August jobs report came out earlier this month, much was made over the “solid” wage growth. Average hourly wages increased by 2.9% on an annualized basis.
Peter Schiff raised an important question when the report hit the news cycle. Is this wage growth indicative of a growing economy? Or is it simply a sign of inflation?
See, I think it’s the latter. I think it’s inflation that is the reason wages are going up. Remember, wages are prices. They’re the price that you pay to hire labor. So, the price of labor is wages … The price of goods and the price of labor are both affected by inflation. So, because we have all this inflation, prices are rising. They’re rising for goods and they’re rising for labor.”