The Inflation Monster Runs Free….

Stocks wobbled but ultimately ended lower on Wednesday, as the fastest pace of inflation in decades stoked bets that the Federal Reserve will be forced to deliver a much larger than expected 1% rate hike later this year.
The S&P 500 closed down 0.5%, the Dow Jones Industrial Average fell 0.7%, or 208 points, the Nasdaq fell 0.1%.

U.S. inflation rose 9.1% in June to hit a fresh four-decade high, topping economists’ forecast for a 9% rise, driven by an 11.2% leap in gas prices and a 1.0% increase in food prices.

This report will make for very uncomfortable reading at the Fed,” it added.
US inflation roared again to a fresh four-decade high last month, likely strengthening the Federal Reserve’s resolve to aggressively raise interest rates that risks upending the economic expansion.

The widely followed inflation gauge increased 1.3% from a month earlier, the most since 2005, reflecting higher gasoline, shelter and food costs. The so-called core CPI, which strips out the more volatile food and energy components, advanced 0.7% from the prior month and 5.9% from a year ago, above forecasts.

The red-hot inflation figures reaffirm that price pressures are rampant and widespread throughout the economy and taking a bigger toll on real wages, which are down the most ever in data back to 2007. The inflation data will keep Fed officials on an aggressive policy course to rein in demand, and adds pressure to President Joe Biden and congressional Democrats whose support has slumped ahead of midterm elections.

“Rather than cooling down, inflation is heating up,” Sal Guatieri, senior economist at BMO Capital Markets, said in a note. “While a pullback in gasoline costs in July and reported retail discounting will help tamp down the flames, the broad pressure in the core rate, led by plenty of inertia in rents, suggests inflation may not peak for a while, and might remain stubbornly high for longer than anticipated.”

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  1. The news isn’t surprising, I am not alone in these predictions myself. Commodities are in decline as a recession is coming! Copper price a great indicator that’s a guide for whether a recession is coming or not!

  2. The central banks and governments have managed to destroy every generational age group and the middle class with inflation. All except the super rich. 👏🏽 bravo. Anyone with savings and fixed interest income is and has been getting hammered.

  3. “Runs free,” slightly hyperbolic, perhaps? It’s running into a wave of rising interest rates, is it not? Hardly running free is it?

    It’s just staggering how ‘professional economists’ shamelessly do a volte face on the latest news. These days days there are little better than journalists, perhaps the most discredited vocation of the 21st century. Enjoy swimming in the hysteria Mr. North, it’s going to be a whirlwind.

    Why wouldn’t you hide in bonds if risk becomes an real uncertainty and not a manageable probability? But the remark by “Once that inflation starts to gently come out of the system” bonds will become good value is just absurd. They are just running scared Mr. North, trying to salvage their careers by being as unimaginative as possible. A shitty return that is a certainty is better than a speculative one your mind can’t grasp let alone quantify.

    But, be seeing you in September still😌.

  4. Inflation will push on regardless of any figures.why ? Because we allowed everything to be controlled by a handful of people and they want there 2000 dollar glass of water.the only reason interest rates went down was for the elite to buy more mergers and take rates rise because we have to pay there the same time they squashed any pitch fork uprisings because the sheep took on massive debt and will be silent until they realise that what they borrowed for will be worthless because half the world population will have died in less than 20 years..

  5. …..DONT BE FOOLED WE THE WEST (& very soon the rest of the WORLD) ARE IN A WAR ECONOMY…WORLD WAR 3, began 2 mths ago….we'll see an Economic Depression in 9 mths time & be told that we have to take the pain to ensure VICTORY & have them stating we need to tighten our belts & send our YOUNG off to a RIGHTEOUS WAR inorder to fight a "BOOGEY-MAN" u know the same shit they did with WW2….once the ELITES strip the planet of any potential to make a profit, they turn to next easiest distraction a WORLD WAR (inorder to keep PROFITING), this also keeps the slaves from coming for them & their children (who are most likely vacationing on Daddy's Super Yacht, somewhere in the Mediterranean, snorting cocaine off a stripper's cleavage)…its bcz they have raped the world financial system (as they always do) & the only way to cover up all their crimes is to distract us (the slaves) with a WORLD WAR (where they keep profiting even more handsomely) they did the same in WW2, we are just a year or two ahead of 1937, if you know your economic history you will know that after the crash of 1929 & its arduous recovery by 1934/35, the world fell into another deep recession in 1937 & the only way out was to stir up Germany & Japan inorder to stoke a WORLD WAR, the ELITES were petrified that the slaves would come for them, same shit today only the (prepared) enemy this time is Russia & China.. so do the "right thing" send your grandchildren, your fathers, your husbands, your brothers, your sisters, your daughters off to war, so the ELITES children can continue partying up on St Barts & the poor are sent off to war to kill each other……STOP BEING SUCKERS !!!!………

  6. The RBA should be forced to get a 2-3% pay cut per annum for senior staff members in line with the inflation target until they get inflation under control. They used interest rates as a carrot to drive economic growth. Now it's their turn to receive the stick for failing to use the carrot correctly.

  7. I'm urging those looking to get in to be ready to buy within months. You have to bet each way else you may risk loosing out big time. Pride and ego are dangerous things. You can't time the market and as soon as inflation trails off and the spooking begins it will be far to late!

  8. How can we have debt to GDP almost 200%. 32 year run up in housing. Mortgage stress. $2.32 petrol prices. Pandemic. Inflation. Highest mortgage repayments since the 90s and still not have a housing crash?
    Begs the question.. does the ability to repay really cause a bubble to burst?

    If not now when?? @walktheworld

  9. Like our forefathers.
    We will fight Stagflation on the beaches.
    We will fight Stagflation on the sidewalk.
    We will fight Stagflation in the corridors of power.
    We will never surrender the land of milk and honey to corrupt political vandals!
    Economic vandals will do their worst ,
    But hard working class people will do their best. long live happiness and freedom.

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