from Channels Television
Gold is ‘Good Money’ as a Hedge Against Inflation and Default Risks, Says Billionaire Investor Ray Dalio
by Neils Christensen
Kitco
(Kitco News) – Billionaire investor Ray Dalio has had a mixed relationship with the U.S. dollar over the last few years, and it appears he is once again raising doubts about the health of the greenback.
In a commentary posted to LinkedIn on Thursday, the former Bridgewater Associates CEO said he is holding gold as a hedge against a potential debt crisis and higher inflation.
The comments come as the U.S. government’s burgeoning debt comes into greater focus. The U.S. national debt has surpassed $34.5 trillion. However, this is not just a United States-based threat.
During its annual spring meeting in Washington, D.C., the International Monetary Fund said in its Fiscal Monitor that China and the U.S. will drive global public debt over the next five years.
How Inflation Impacts Cash, Stock Markets, Investments and a Possible Housing Market Crash with John Grace
from Kerry Lutz's Financial Survival Network
Kerry and John Grace discussed the changing role of utilities in the context of electric vehicles and artificial intelligence trends. The speakers emphasized the need for increased stations and the limitations of solar and wind power. They also explored the potential of battery power to stabilize the grid and address the challenges faced by millennial first-time homebuyers. The conversation provided insights into the changing landscape of utilities and real estate, shedding light on the implications for both industries in the current market. John and Kerry also discussed the significance of consumer age in shaping buying and selling behavior, drawing attention to the historical trends in home purchasing and the age at which individuals typically make significant property investments. The speakers highlighted the impact of life expectancy on housing market dynamics, emphasizing the need for forward-looking asset management strategies. The discussion also delved into the challenges of selling a property that has doubled in price, with considerations for relocation and the financial implications. Overall, the conversation emphasized the importance of being prepared for market fluctuations and making strategic decisions to safeguard assets.
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US Bond Bulls Lean Into Latest Selloff Despite Inflation Scare
by Reuters
Kitco
NEW YORK, April 22 (Reuters) – A sharp selloff in U.S. bonds so far in April is prompting some investors to consider allocating more funds to the asset class to lock in higher yields ahead of interest rate cuts by the Federal Reserve, a prospect that remains investors’ base case despite U.S. economic resilience.
Treasury yields, which move inversely to prices, have soared in recent weeks, opens new tab after a string of solid economic data and three consecutive monthly inflation prints showing a rebound in price pressures pushed out expectations of when the Fed would start cutting rates. The benchmark 10-year yield has approached 5% – a level last touched in October for the first time in 16 years.
Minneapolis Fed Pres: Biden Spending On Chips, Infrastructure ‘is Inflationary’ and There Are ‘Cross-Purposes’
by Ian Hanchett
Breitbart.com
On Thursday’s broadcast of the Fox News Channel’s “Your World,” Minneapolis Federal Reserve Bank President Neel Kashkari stated that stimulus spending was “a contributor to the high inflation that we’ve seen.” And “the spending on infrastructure, the spending on new chip plants, all of that, on a margin, is inflationary.” Kashkari further stated that while it’s not clear if that spending impacts inflation at the national level, “we are a little bit at cross-purposes” with government spending.
Kashkari said, [relevant remarks begin around 2:35] “Well, the data is going to guide us, we’ve been surprised — in a concerning way — about the first three months’ inflation data this year. The second half of last year, we saw a lot of progress as inflation fell back towards our target.
S&P 500 Heads for Worst Month Since 2022 as Bond Yields Jump On Inflation Fears
‘We got a rise in commodity prices, which is problematic for the Fed,’ says Bob Elliott, CIO of Unlimited Funds
by Christine Idzelis
Market Watch
The S&P 500 is on pace for its biggest monthly drop since December 2022, with April’s pullback erasing about half the gains the U.S. stock market had booked this year by the end of March. The index has slumped 5.5% this month through Friday, lowering its climb in 2024 to 4.1%.
Still, the S&P 500 is just 5.5% from its record closing peak on March 28. Equities investors got it right this year that economic growth remained strong in the U.S., but the problem now is that the view is already priced into stocks — and that yields in bond market were left to catch up, according to Bob Elliott, chief executive officer and chief investment officer of Unlimited Funds.
Fed’s Preferred Inflation Gauge is Set to Back Rate-Cut Patience
by Molly Smith and Craig Stirling
BNN Bloomberg
(Bloomberg) — Federal Reserve officials are about to get further confirmation that progress against inflation has stalled, supporting what appears to be a shift in tone to keep interest rates higher for longer than previously anticipated.
Policymakers’ preferred inflation gauge — the personal consumption expenditures price index — probably stayed elevated in March, according to data due in the coming week.
The measure is seen accelerating slightly to 2.6% on an annual basis as energy costs rise. The core metric, which strips out energy and food, is expected to rise 0.3% from the prior month after a similar gain in February.
Why Haven’t We Whipped Inflation Yet?
by Alexander William Salter
The American Institute for Economic Research
Despite extraordinary monetary tightening by the Federal Reserve, inflation remains elevated above its 2 percent target. Even more worrying, inflation accelerated during the first quarter. The Consumer Price Index (CPI) rose at an annualized rate of 4.5 percent over the last three months. The figures for Personal Consumption Expenditures Price Index (PCEPI) are similar through February, with March data set to release later this month. It looked like we had inflation whipped as recently as December. Now it looks like price stability is slipping away.
Many commentators (including myself) were worried monetary policy had become too restrictive as inflation eased. Others worry the Fed is missing the signs of an inflation resurgence, just as they misdiagnosed inflation beginning in 2021 as “transitory.” Clearly there is room for reasonable disagreement. But there’s still a puzzle here: by conventional measures, money looks tight. It’s not clear what needs to happen next to get disinflation back on track.
How to Beat Inflation: First, Tackle Lifestyle Creep
Managing lifestyle creep is challenging financially and psychologically, especially with inflation. Expert strategies keep day-to-day spending in check.
by Renée Sylvestre-Williams
Money Sense
The other day I had to run out to buy cooking oil to make dinner. I knew which brand I wanted because it was a good size and it was cheap—$5 when I bought it about three months ago. I was surprised and annoyed to find out that the same bottle of oil, which was the exact same size and shape with the same type of oil in it, was now $7.
It had gone up $2 in the last three months. Now, that doesn’t sound like a lot since it’s “only two dollars,” which shouldn’t affect your budget. But add in other expenses like the cost of gas, other grocery items and rent, and those “tiny” increases add up. Inflation really makes the wallet hurt.
The Psychology of Inflation
by Ben Carlson
A Wealth of Common Sense
A reader asks:
I get all the stuff Ben has been saying about inflation — wages have kept pace, economic growth has been higher than the 2010s, wages have risen the most for lower income people, etc. I get all that. My husband and I own a house and own stocks so we’ve benefitted in recent years. Having said all of that, I STILL CAN’T GET OVER HOW HIGH PRICES ARE!!!
The grocery store, home/auto insurance, restaurants, babysitters for the kids…everything is more expensive.
So how do I get over the sticker shock? Will it just fade eventually as we get used to higher prices?
The psychological component of inflation is obviously a real phenomenon.
One of the reasons for this is because inflation is personal.
Blame the Rent for America’s Sticky Inflation Problem
Get caught up.
by David Rovella
Bloomberg.com
When US inflation peaked above 7% back in 2022, the culprits were everywhere—spread across goods and services. Now, with inflation back below 3%,the problem is mainly about housing. Hotter-than-expected readings for the rental category in the first few months of the year are a big reason the Federal Reserve held back on those rate cuts Wall Street was whining for. “We thought we basically understood the mechanical, short-run model of how much housing inflation should be coming down,” said Chicago Fed President Austan Goolsbee. “And it hasn’t come down as fast as we thought it was going to have come down at this point.”
[…] Even the rental inflation problem itself isn’t particularly broad-based anymore, geographically anyway. There’s a big difference between the situation in the Northeast and Midwest, where high inflation is lingering, and the West and South, where it’s moderating rapidly.
Why We Cannot Reach the Fed’s 2% Inflation Target
by Martin Armstrong
Armstrong Economics
The Consumer Price Index (CPI) released on April 10 by the US Bureau of Labor Statistics reported that inflation rose by 0.4% on a monthly basis and by 3.5% on the yearly. One must only look at their bills, items in the store, or open their eyes to see that the cost of living in every area has far surpassed this figure. Federal Reserve Chairman Jerome Powell released some disparaging comments regarding the data, and we should not expect any rate declines in the near-term. The Fed’s 2% target is simply not possible due to excessive government spending. Inflation was never transitory and we have not had a soft landing. Yet, the Biden Administration insists the “economy is going in the right direction.”