by Pete Schroeder
Global News, Canada
The International Monetary Fund is cautioning against overexuberance in markets as investors look for central bankers to pull off a “soft landing” in their years-long inflation battle.
In its latest semi-annual Global Financial Stability Report, the IMF noted that markets have turned “quite optimistic” since the October edition, when investors were still recovering from spring turmoil in the banking sector.
Now, downside risks are receding, but the IMF is cautioning against complacency, noting that stretched valuations across a range of asset classes, geopolitical tensions, and rising debt levels could all pose problems if central bankers have to keep rates higher for longer to contain stubborn inflation.
During an interview with Nexstar Media that took place on Tuesday and was released on Wednesday, President Joe Biden stated that inflation “is being stubborn and not going down to the 2% we need. But, it’s significantly different,” than where it was and “the thing that really affects people’s lives are all the small things that add up to big numbers for people, all these junk fees.”
Exactly two years ago this week, as post-pandemic inflation emerged as a leading public concern, Donald Trump appeared on Fox News and was asked what he’d do to address inflation if he were in the White House. The Republican gave a long, meandering, and wildly dishonest answer, which didn’t even try to address the underlying question.
(Bloomberg) — Federal Reserve Chair Jerome Powell signaled policymakers will wait longer than previously anticipated to cut interest rates following a series of surprisingly high inflation readings.
Bowing to recent data, Federal Reserve Chairman Jerome Powell on Tuesday conceded that inflation progress has stalled and the case for rate cuts has weakened.
The Fed has been battling rising prices with interest rate hikes since 2022, lifting its key lending rate to a 23-year high as it looks to hit its long-term inflation target of two percent.
WASHINGTON (AP) — Federal Reserve Chair Jerome Powell cautioned Tuesday that persistently elevated inflation will likely delay any Fed interest rate cuts until later this year, opening the door to a period of higher-for-longer rates.
In the aftermath of the pandemic, the United States experienced the highest rates of inflation of the last four decades. More recently, inflation rates have been trending lower. Nonetheless, a number of economists have been surprised to observe that consumers aren’t very happy despite signs that the inflation rate is on a trajectory towards the Federal Reserve’s target of two percent. Although a number of economists have been quick to dismiss consumer pessimism or explain that things are actually quite good, a recent paper by economists at Harvard and the IMF offers an explanation for pessimism: perhaps consumer measures of the cost of living differ from the price indices that economists use to measure inflation.
Rising inflation in March didn’t deter consumers, who continued shopping at a more rapid pace than anticipated, the Commerce Department reported Monday.
The middle class in the United States has been steadily shrinking, and the gap between the ultra-wealthy and the rest of us has grown to absurd proportions. But it wasn’t always this way. When I was growing up in the 1980s, it seemed like almost everyone was middle class. Of course there were wealthy people and poor people in the 1980s too, but the vast majority of the population was comfortably somewhere in the middle. Sadly, things have changed so much since that time. Today, most of the people that I know are struggling. According to a report that was just released, in all 50 states it now takes an income of more than $100,000 in order for a family of four to live “the American Dream”…