The price escalation in California is particularly notable. While the national average for a dozen Grade A large eggs hovers around $3.20, in California, the average price for a carton of white cage-free eggs has hit $5.11. However, in certain regions, consumers are seeing prices nearly double that amount.

The bird flu outbreak, which began in 2022, has led to the death or culling of millions of egg-laying hens, drastically reducing egg production. This has been compounded by seasonal demand spikes, especially around holiday periods, and the ongoing challenges with rebuilding poultry flocks.

Despite some recovery in egg production after previous outbreaks, the persistent spread of bird flu has kept egg prices high. According to experts, the situation could persist into 2025 if HPAI continues to affect poultry farms.

Inflation and increased production costs, including labor, fuel, and feed, have also played roles in the price hike. These factors have not only affected egg prices but have contributed to the overall rise in grocery costs.

The economic impact of these high egg prices has been significant for both producers and consumers. For producers, the cost of recovery from bird flu outbreaks, coupled with feed and labor cost increases, has been substantial. For consumers, the price at the checkout has led to adjustments in household budgets, with many seeking alternatives or reducing egg consumption.

Efforts are ongoing to control the spread of bird flu, including stringent biosecurity measures on farms. However, the full recovery of the egg market to pre-outbreak levels seems distant, with experts suggesting that without a significant reduction in HPAI cases, prices might remain elevated.

In response to these high prices, some communities have seen the rise of local initiatives like community markets providing free eggs to help alleviate the burden on low-income families, particularly those dependent on programs like WIC, which covers eggs for millions in California.

As California grapples with these elevated egg prices, the situation underscores broader issues of food supply chain resilience in the face of disease outbreaks and economic pressures.

Article generated from corporate media reports.

(Schiff Gold)—On the latest episode of the Peter Schiff Show, Peter dives into a week of new inflation data. He calls out the shaky foundations of the so-called “strong” economy, criticizes foreign central bank policy, and explains how inflation masks the benefits of economic growth.

To start, Peter reports alarming deficit numbers for the 2025 fiscal year:

During the first two fiscal months of 2025, because we’re already in that fiscal year, the budget deficit in those two months alone was six hundred and twenty four billion dollars. That’s a 65% increase over the same two months a year ago. In fact, the first time that the United States government ran a six hundred and twenty four billion dollar deficit for an entire year, not just for two months, but for an entire year, was 2009, right after the 2008 financial crisis.

These figures clash with the official narrative that the economy is doing well. If that’s really the case, why do the American people disagree?

If consumers were in the greatest shape ever, according to this Wall Street analyst, they would have voted for Kamala. They wouldn’t have tried to get rid of her because things are supposedly so awful, and they’re hoping that Trump would change things. … It’s like you’re lying in a hospital bed, plugged into all kinds of artificial life support, tubes in your mouth, tubes in your nose, blood going intravenously into your body, and you ask the doctor, ‘What’s going on?’ ‘You’re in great shape, absolutely perfectly healthy, except if we unplug anything you’re going to drop dead.’

A hotter-than-expected inflation report released on Thursday practically demands rate hikes from the Fed, but the market still predicts the Fed will cut rates at its December meeting:

All these numbers confirm is that inflation is bottoming out and is headed much higher, and it never got anywhere near 2%. Especially if you look at the PPI (Producer Price Index), which is a leading indicator for the CPI, because generally businesses have their prices go up first and then they pass it on to the consumer second. … The expectation for the increase in November producer prices was 0.3%, and we got 0.4%. That was double the increase from the prior month of 0.2%, so we’re heading in the wrong direction fast.

Current predictions place the likelihood of the Fed cutting rates again at over 95%. This is sadly aligned with the inflationary monetary policy being implemented in Europe and the rest of the world:

Yet the Fed is going to cut rates by another 25 basis points. By the way, the ECB (European Central Bank) cut rates 25 basis points this week, and the Swiss National Bank went for a super-sized 50 basis point cut… Inflation is going to rear its head in a big way all over the world: the Eurozone, Japan, all these countries that are cutting rates should not be cutting rates. Inflation is going to roar back stronger than ever, worse than what we had in 2001, 2002.

Central banks hoodwink their citizens with inflation, obscuring economic progress for the sake of their own policy goals:

Let’s assume that all else being equal the government doesn’t create any inflation and productivity is so good that prices would have fallen by 5. Well, that’s great. That’s a huge economic benefit for the economy. …  Now the government creates inflation and instead of prices going down by 5 percent they go up by 2 percent. Now you’re going to say oh well, there’s no inflation now because now we’re at the fed’s 2 target. No! Prices are 7% higher than they otherwise would have been. We didn’t get all that inflation for free. The government robbed us of that increase in our standard of living. They took away the benefit of those price cuts.

For more analysis of last week’s economic numbers, check out Joel’s analysis on the SchiffGold Gold Wrap Podcast.

Unfortunately, it isn’t just egg prices that are spiking.

According to CNN, we just witnessed the largest monthly jump in grocery prices in almost two years…

In November, egg prices shot up by 8.2% nationwide, logging one of the highest monthly spikes in the past two decades, according to Consumer Price Index data released last week. And it’s not just eggs — shoppers have seen jumps in beef, coffee and non-alcoholic beverages, driving up overall grocery prices to their largest monthly gain since January 2023.

And more increases appear to be coming down the pike for the pulped-paper-packed protein: Wholesale prices for chicken eggs soared by nearly 55% last month, and wholesale food prices rose by 3.1% (their highest monthly increase in two years).

Our leaders in Washington promised us that food inflation was under control.

They lied.

I realize that this is very bad news.  I have heard from so many of you that are deeply struggling at this moment.  Now it appears that food prices are going to go substantially higher in 2025.  All of us are just going to have to adapt to this new environment somehow.

If you are barely scraping by from month to month, I want you to understand that you are definitely not alone.

In fact, the U.S. Census Bureau is telling us that 37 percent of Americans are having trouble even paying their most basic bills…

The Census Bureau reports that 37% of Americans are struggling to pay routine bills. Add in the cost of Christmas gifts and other holiday expenses and it can feel overwhelming to keep up with the Clauses.

The National Retail Federation predicts an increase in holiday spending this year, but the rise is more indicative of the higher cost of goods than anything else. We aren’t buying more; it’s just what we are buying costs more than before.

That is more than a third of the country.

It is difficult for people to hear that they aren’t going to be able to live the way that they previously did.

In an attempt to keep their lifestyles the same, many Americans are racking up credit card debt like never before…

A new study of Americans credit card debt finds the average household credit card balance as of the third quarter of 2024, was around $10,757 after adjusting for inflation.

That according to the personal-finance website WalletHub which Friday released its new Credit Card Debt Study, which found that consumers added $21 billion in debt during the third quarter of 2024.

Early results for the fourth quarter of the year show preliminary data for October at a new record high for credit card debt in the month, in absolute terms.

Sadly, we have now reached a point where debt saturation is becoming a major problem and delinquencies are rising.

Consumers simply cannot spend money like they once did, and the retail industry is really struggling as a result. So far this year, retailers have announced the closing of more than 7,000 stores.  That represents an increase of 69 percent from last year…

Retail store closures in the United States rose sharply in 2024, with over 7,100 closures announced through the end of November, according to data from the research firm CoreSight. This number marks a 69 percent increase from the previous year under the Biden-Harris administration, which has been plagued by inflation.

The spike in closures is tied to a wave of retail bankruptcies, with 45 retailers filing this year compared to 25 in 2023. Economic challenges, including persistent inflation, have led consumers to cut back on discretionary spending.

As I discussed last week, evidence that the economy is really slowing down is all around us.

I am sure that you can see this where you live, and with each passing day we get even more troubling news.

For example, it is being reported that Macy’s is planning to close dozens of stores by the end of this calendar year…

Macy’s is ramping up store closures this year as it struggles to revive its faltering business.

In February, the embattled retailer announced plans to shut 150 underperforming stores within three years – including 55 closures by the end of 2024.

But the company now expects to close 65 locations by the end of the year. Bosses said they will remain open through the holidays to let regular customers shop but then shutter for good before the end of December.

And in a year when so many restaurant chains have already bit the dust, we now have another one to add to the list…

Arizona’s iconic frozen drink and sub chain Eegee’s has filed for Chapter 11 bankruptcy, making it the latest casualty in a brutal year for fast-food restaurants.

The announcement came with the closure of five locations across Tucson and Phoenix, leaving die-hard fans heartbroken.

The December 6 filing in Phoenix federal court gives the embattled chain – owned by private equity firm 39 North Capital – a chance to reorganize its finances.

Four years of “Bidenomics” has taken an enormous toll on our nation.

We have built up a tremendous amount of economic momentum in the wrong direction, and the very foolish policies of our leaders are taking us exactly where I warned they would take us.

Many are hoping that things can be turned around when the new administration takes over.

But considering how rapidly conditions are deteriorating both here and around the world, it would literally be a major miracle to pull us out of this mess before a horrifying global crisis erupts.

So let us hope for the best, but let us also continue to prepare for the worst.

Michael’s new book entitled “Why” is available in paperback and for the Kindle on Amazon.com, and you can subscribe to his Substack newsletter at michaeltsnyder.substack.com.

This bar chart, via Visual Capitalist’s Selin Oğuz, sponsored by Brazil Potash, uses the latest data from Trading Economics to show which countries have the highest food inflation.

Leading all countries, Argentina is grappling with a 183% year-over-year increase in food prices. The country also has the highest forecasted food inflation in the world, at 120%, for next year’s second quarter.

Argentina’s high food inflation stems from a mix of its currency devaluation, severe droughts, reliance on exports, economic instability, and political unrest.

Palestine is the runner-up for the highest food inflation with 115%. However, it is forecasted to lower dramatically to 12% halfway through 2025.

Meanwhile, six of the next eight countries are all in Africa. The African countries with the highest food inflation are Zimbabwe at 105% and South Sudan at 96%.

At the same time, other African nations, like Malawi, Nigeria, and Angola, face rates between 34% and 44%, highlighting the broader food inflation trend across the continent.

At that meeting, FOMC members overwhelmingly voted to lower the federal funds rate by 25 basis points, to a new range of 4.5–4.75 percent, signaling further loosening of restrictive monetary policy.

The meeting summary indicated that officials are confident that inflation is moving sustainably toward the institution’s objective of 2 percent. The Fed could rapidly ease policy if there were sudden weakness in the labor market or the broader economy, the document said.

“In discussing the outlook for monetary policy, participants anticipated that if the data came in about as expected, with inflation continuing to move down sustainably to 2 percent and the economy remaining near maximum employment, it would likely be appropriate to move gradually toward a more neutral stance of policy over time,” the minutes stated.

Meeting participants did express uncertainty regarding how low interest rates need to be before touching the neutral rate that neither stimulates economic activity nor halts growth.

“Many participants observed that uncertainties concerning the level of the neutral rate of interest complicated the assessment of the degree of restrictiveness of monetary policy and, in their view, made it appropriate to reduce policy restraint gradually,” the minutes said.

Looking ahead, Fed policymakers said that incoming data are consistent with the central bank’s 2 percent inflation target. They noted that higher shelter costs bolstered recent higher readings.

“Participants cited various factors likely to put continuing downward pressure on inflation, including waning business pricing power, the committee’s still-restrictive monetary policy stance, and well-anchored longer-term inflation expectations,” it added.

Fed Chair Jerome Powell told reporters at the post-meeting press conference earlier this month that the road to 2 percent inflation may be “bumpy” with more bumps in the road.

As for the U.S. economic landscape, participants concluded that downside risks to the labor market and wider economy decreased.

In addition, staff projected that economic conditions would remain solid and growth projections would be higher than in the previous assessment.

Tim Barkin, president of the Federal Reserve Bank of Richmond, recently expressed caution over the labor market but was optimistic about inflation.

“The labor market might be fine, or it might continue to weaken,” Barkin said in prepared remarks to the Baltimore Together Summit on Nov. 12.

“Inflation might be coming under control, or the level of core might give a signal that it risks getting stuck above target.”

Market Reaction

Financial markets registered tepid gains toward the closing bell on Nov. 26, with the leading benchmark indexes up by as much as 0.4 percent.

Yields in the U.S. Treasury market attempted to reverse the previous session’s sharp decline. The benchmark 10-year yield topped 4.3 percent. The two-year yield was flat at 2.5 percent, while the 30-year bond surged to 4.48 percent.

The greenback extended its gains. The U.S. dollar index, a gauge of the greenback against a basket of currencies, recorded a modest increase and added to its year-to-date rally of 5.6 percent.

Policy minutes did little to change the market’s assessment of next month’s outcome.

“The minutes did nothing to alter my view that the policy rate is going to be adjusted lower next week and will continue to do so through the next calendar year,” Jamie Cox, managing partner for the Harris Financial Group, said in a note emailed to The Epoch Times.

According to the CME FedWatch Tool, investors are mostly penciling in a quarter-point rate cut.

The rate-cutting cycle will persist throughout 2025, though Fed easing might not be as aggressive, says Jeffrey Roach, the chief economist at LPL Financial.

“In our view, after weeks of markets pricing in too many rate cuts throughout 2025, Fed rate cut pricing is now better aligned with economic data,” Roach said in a note emailed to The Epoch Times. “Currently, markets still expect the Fed to cut rates below 4 percent by the end of 2025.”

The FOMC will hold its next two-day policy meeting on Dec. 16–17.

The sitting President ended his bid for a second term. His opponent was charged with dozens of made up crimes. Corporate media has become apoplectic in their coverage of the news. A presidential candidate was nearly assassinated. Twice.

But through the maelstrom of crazy circumstances remains a very stark reality: Our nation is in big trouble facing existential threats at a scale not seen since the Civil War.

I am confident in three things.

• Donald Trump will win both the popular vote and the Electoral College in a landslide — the polls are, as always, being manipulated
• The UniParty Swamp, Deep State, and Globalist Elite Cabal are doing everything in their power to steal the election, gaslight Americans, and control the fate of the world
• God’s absolute supremacy means He will choose who is in the Oval Office next January

That last note will certainly ruffle feathers. Even Bible-believing Christians might take offense for many reasons. Some take this stance as not believing in free will. But my worldview is what drives me to work harder knowing that I do not know my place in His plan and therefore all I need to do is fight the good fight with all I have.

For that reason, I want to write my final column ahead of the election as a reminder of the three issues driving voters.

Yes, It’s the Economy

James Carville was right when he said, “It’s the economy, stupid.” This is normally the most pressing issue deciding elections at the federal level. Ironically, it doesn’t always work at the state, county, and local level as we’ve seen with the most desolate voters repeating their mistakes for decades in blue areas.

Unfortunately, the campaigns haven’t put the appropriate level of effort into disseminating their actual economic plans. Trump mentions tariffs often and promises to cut taxes but his campaign should have explained the inflation issue better. They had an opportunity to educate Americans on the Inflation Reduction Act and remind them that Kamala Harris was the deciding vote.

I’m not a campaign advisor for a reason. I’m sure well-paid analysts and experts would tell me that the messaging behind inflation would be too complex if they dove into the details, but I believe in this digital world it wouldn’t have been hard to drive the message home. For whatever reason, there’s still too much emphasis on :30 second pump up pitches and 1:00 minute attack ads. Maybe it works, but I believe with the right messaging the details could be brought to light.

Regardless, the economy is a clear advantage for Trump and if we need a final day message, it should be that Kamala Harris has only promised more of the same as we’ve seen for the last four years.

The Invasion

The border crisis is apparent to anyone with eyes to see and ears to hear, so there’s no need to dwell on this issue. We are being invaded and it is going to destroy this nation if it’s not stopped immediately.

The Trump campaign messaging on this has been solid. The only thing I would have added is more of an emphasis on an unavoidable fact: American citizens struggling in urban areas are the most negatively impacted by the border crisis.

It’s funny that the one time an issue truly affects the “underprivileged” is the only time Democrats are unwilling to talk about it. They’ve said climate change harmed minorities more. They said Trump’s tax cuts harmed the poor. They said just about everything is racist, misogynistic, transphobic, or otherwise detrimental to a protected class. But they won’t admit the border invasion does the most harm to the people they pretend to protect.

This is unambiguously a huge argument for Trump.

Abortion

I’ll keep this one short because I’m one of those radical pro-life purists. Yes, I want abortion banned altogether, but I know that’s not going to happen anytime soon.

I also know that the chances of any abortion legislation hitting the next president’s desk are nearly nil. The hypothetical nationwide abortion ban that Trump keeps getting asked about will never happen and, contrary to Project 2025’s wishes, no Republican in DC is seriously considering it. Trump said he’d veto it if it magically appeared.

The hypothetical codification of Roe v. Wade would only hit Kamala’s desk if Democrats control both the House and Senate and then the Senate ejects the filibuster. The massive election shenanigans required for that would be at a scale I do not believe Democrats are willing to use. I could be wrong, but I hope I’m not.

This means that all of those voters, mostly Democrats, who are voting based on the abortion issue are putting a nothingburger on a pedestal. This election will have very little impact on their rights to murder preborn babies. As we’ve seen since Roe v Wade was overturned, it’s not like abortions have been reduced. They’ve risen.

Conclusion

It’s in God’s hands. We have to do our part, vote, get the word out, and hope that we make it through this cycle unscathed. But as always, we still have to get the Word out by spreading the Gospel.

I can’t wait for this election to be over.

The economy ranks as the most important of 22 issues that U.S. registered voters say will influence their choice for president. It is the only issue on which a majority of voters, 52%, say the candidates’ positions on it are an “extremely important” influence on their vote. Another 38% of voters rate the economy as “very important,” which means the issue could be a significant factor to nine in 10 voters.

Voters view Donald Trump as better able than Kamala Harris to handle the economy, 54% versus 45%. Trump also has an edge on perceptions of his handling of immigration (+9 percentage points) and foreign affairs (+5), while Harris is seen as better on climate change (+26), abortion (+16) and healthcare (+10). The candidates are evenly matched on voters’ impressions of who would better address gun policy.

Countless other surveys have told us the same thing.

The American people remember what life was like before the pandemic, and they desperately want to have that back.

In particular, U.S. voters have become deeply frustrated with the cost of living…

“It’s inflation, stupid!” wrote Bernard Yaros, U.S. lead economist at Oxford Economics, in an October 24 report, borrowing from political strategist James Carville’s famous coinage. “Inflation is the foremost issue voters are concerned about, and how it is perceived will determine the election.”

The Biden administration is being blamed for this inflation crisis, and that is going to cost Kamala Harris millions upon millions of votes.

At this moment, demand at food banks is off the charts in many of the key swing states that Harris desperately needs to win.

In Pennsylvania, we are being told that demand “is actually as high as it was at the peak of the pandemic”…

Joe Arthur, who runs the Central Pennsylvania Food Bank, told NBC News the current problem is “a hunger crisis.”

“The need that we’re seeing in our localities is actually as high as it was at the peak of the pandemic, yet there are less resources for those families today.”

At one food bank in Michigan, demand is actually “significantly higher” than it was during the pandemic…

One truck can carry enough food for up to 600 households, but some days even that isn’t enough to meet the demand, which has gone up by 18% over the past 12 months, said Ken Estelle, president of Feeding America West Michigan.

“We have never seen this level of need in the 43 years we have been serving this community. It is significantly higher than during Covid and has pressed us beyond our capacity,” said Estelle. “We’ve just seen this drumbeat increase every month of more people and more people.”

And at one food bank in Wisconsin, demand has more than doubled since 2022…

In the relatively affluent Milwaukee suburbs of Waukesha County, Wisconsin, Rochelle Gamauf said each week she is seeing new faces at her food pantry, Friends With Food, which she started during the pandemic.

The organization has gone from giving out around 420,000 pounds of food in 2022 to over a million pounds in 2023. On a recent week in September, nearly 400 families came through the door, 48 of whom were coming for the first time — a 50% increase in new families compared to last year, she said.

This is the biggest reason why Donald Trump is leading in the polls in all three states.

A lot of the people that are going to these food banks actually have jobs. But they aren’t earning enough to keep up with the rapidly rising cost of living.

If you go to the grocery store and you completely fill up your cart with food, it is going to cost you hundreds of dollars. 25 years ago, I could fill up an entire grocery cart for less than 50 bucks.

Inflation is a hidden tax on all of us, and it is suffocating millions upon millions of households all over the country.

Of course the Biden administration insists that everything is just fine.

For months, the government has been releasing numbers that look great initially, but later they are revised dramatically lower.

Let me give you an example.  Last month we were told that job openings were rising, but now we have learned that they are actually plunging…

Last month, when Kamala Harris still had some chance of winning the election, we were not surprised to learn that according to the extremely political Bureau of Labor Statistics, in August the number of job openings unexpectedly soared from an upward revised 7.7 million to 8.040 million, which was not only a 3-sigma beat to expectations, but was also above the highest Wall Street forecast. Fast forward to today, when Kamala’s chance of winning are effectively zero – as even the suddenly apolitical Jeff Bezos now admits – and shockingly moments ago the BLS reported that in September, the number of job openings  plunged from over 8 million to just 7.4 million, the lowest since early 2021…

This kind of thing has been happening over and over again.

The American people are sick and tired of being fed fake numbers when they can see that economic conditions are clearly deteriorating all around them.

Our standard of living has been steadily declining for years, and most Americans are just barely scraping by at this point.

I am entirely convinced that most of the experts will be completely shocked by the outcome of this election, and our imploding economy will be the number one reason why so many unexpected voters come out of the woodwork.

Michael’s new book entitled “Why” is available in paperback and for the Kindle on Amazon.com, and you can subscribe to his Substack newsletter at michaeltsnyder.substack.com.

The latest S&P Global U.S. Manufacturing PMI, a survey-based monthly overview of factory activity in the United States, fell deeper into recession territory in September, data released on Sept. 23 shows. The manufacturing index slumped to 47.0 in September, down from August’s 47.9 and the lowest in 15 months. Readings below 50 represent a contraction in activity.

The decline signals continued deterioration in business conditions within the manufacturing sector, which has been plagued by weakening demand and falling new orders. In particular, new orders in September fell at their fastest pace since December 2022, as manufacturers struggled with declining export demand and reduced domestic sales.

Slumping employment also made a significant negative contribution to the downbeat manufacturing figures, with job losses accelerating at a pace not seen since June 2020.

“Excluding the pandemic, the decline in factory jobs was the steepest since January 2010 as an increasing number of firms reported the need to reduce operating capacity in line with weak sales,” the S&P Global report states.

Cracks in the labor market were behind the Federal Reserve’s decision last week to deliver a large, 50-basis point interest rate cut, with one Fed official saying on Sept. 23 that he was surprised by the pace of deterioration in employment conditions.

“Progress on inflation and the cooling of the labor market have emerged much more quickly than I imagined at the beginning of the summer,“ Atlanta Federal Reserve President Raphael Bostic, a voting member of the Fed’s interest-rate-setting council, said in comments to the European Economics and Financial Centre. ”In this moment, I envision normalizing monetary policy sooner than I thought would be appropriate even a few months ago.”

The central bank’s rate-setting body, the Federal Open Market Committee (FOMC) of which Bostic is a voting member this year, decided last week to lower rates to within a range of 4.75–5.0 percent.

Markets are fully pricing in another rate cut when the policymaking panel meets again on Nov. 7, with the odds split roughly evenly between a smaller quarter-point cut or another jumbo half-point reduction.

But while central bank officials celebrate inflation falling closer to the Fed’s 2 percent target, Monday’s S&P Global data suggests it may be too soon to declare victory in the fight against high prices.

Inflationary pressures picked up across both goods and services, per the S&P Global report, with the increase driven mostly by rising input costs. Prices charged for goods and services rose at their fastest pace in six months, with service sector costs surging due to wage growth. Input costs in services grew at their highest rate in a year, reflecting increased labor expenses, while manufacturing input cost growth cooled slightly, aided by lower energy prices and fewer supply chain snags.

“The survey’s price gauges meanwhile serve as a warning that, despite the PMI indicating a further deterioration of the hiring trend in September, the FOMC may need to move cautiously in implementing further rate cuts,” Chris Williamson, chief business economist at S&P Global, said in a statement.

In contrast to a deepening slump in manufacturing, service sector activity grew at a solid pace in September, per the S&P Global report. The services business activity index came in at 55.4, a slight decline from August’s 55.7. Relatively robust growth in services helped lift the composite PMI measure—which combines both manufacturing and services—to 54.4 in September, a slight decline from the prior month.

“The early survey indicators for September point to an economy that continues to grow at a solid pace, albeit with a weakened manufacturing sector and intensifying political uncertainty acting as substantial headwinds,” Williamson wrote, while partly blaming election-related uncertainty for a sharp slump in optimism about business output in the year ahead.

The deterioration in output-related confidence sent the sentiment gauge to its lowest level since October 2022 and the second-lowest since the pandemic.

You have to start with the most fundamental concept here: central planning doesn’t work. That’s the first principle. Central planning of shoes doesn’t work. Central planning of wheat doesn’t work, and central planning of (fake) money doesn’t work.

Central banks in general—and the Fed in particular—are on a mission impossible. They don’t know what the interest rate should be. Nobody does. That’s an exclusive function of a voluntary market of savers and borrowers.

A politburo can’t centrally plan interest rates any more than they can potatoes. They’re inevitably going to fail and cause significant damage.

It’s also important to remember central banks have NOTHING to do with the free market. They’re actually the antithesis of the free market. In Karl Marx’s Communist Manifesto, central banking is the 5th plank.

The lying media portrays central bankers as selfless bureaucrats who are just trying to save the economy. It’s a load of BS. Central bankers are the enemy of the average person.

Now, back to the rate hiking charade.

The Fed had embarked on one of the steepest rate hike cycles in history in 2022. They did so because price increases were spiraling out of control after the Fed inflated the money supply by around 40%—a staggering amount—amid the Covid mass psychosis starting in 2020.

In other words, they were forced to embark on this steep rate hike cycle to combat the inflation that they caused in the first place.

At the time, I knew they would never be able to tame inflation because of the skyrocketing federal debt load. If the Fed was able to raise interest rates to the point where it would actually defeat inflation, the rising interest expense on this exploding pile of debt would have bankrupted the US government.

The federal debt’s interest cost is already higher than the defense budget. Soon, it could exceed Social Security and other entitlements and become the number one item in the federal budget.

For context, the last time inflation was raging, Fed Chair Paul Volcker needed to raise interest rates above 17%. However, that was in the early 1980s, when the US debt-to-GDP ratio was around 30%. Today, it’s north of 123% and rising rapidly.

Today’s higher debt load and accompanying interest expense are why the Volcker option is not on the table. There’s no way the Fed could raise rates any near 17%. They barely took rates above 5% this time before capitulating—not even 1/3 of what Volcker did.

In short…

1. The federal interest expense exceeded $1 trillion for the first time recently.
2. The federal interest expense has recently exceeded national defense spending for the first time and is poised to become the largest item in the budget.
3. The US government is now borrowing money to pay the interest on the money it has already borrowed.

Considering all of this, Fed Chair Powell’s recent announcement that the rate hike cycle is officially over shouldn’t have been a surprise. Now, we’re going back to monetary easing.

The Fed’s Propaganda Victory

The Fed and its apologists in the lying media are trying to gaslight you and tell you inflation has been defeated, which is absurd.

The Consumer Price Index (CPI) is the most politically manipulated statistic in all of government. That is saying something because a lot of government statistics are completely manipulated, but inflation, as measured by the CPI, is probably the most manipulated.

The CPI is a basket of prices trying to measure the average price changes for 340 million Americans. It’s an impossible task because every individual has a different price basket. Consider someone who lives in New York City compared to someone who lives in rural Montana. They have totally different price baskets.

Using the CPI as a measure of price increases for 340 million people is even more preposterous than taking the average temperature across 50 states in the US as a meaningful statistic to determine what clothes you should wear today.

Further, the government gets to cherry-pick what items go in the CPI basket and their weightings. It’s like letting a student grade his own paper.

In short, the CPI is a worthless statistic. It’s misleading government propaganda intended to conceal the government’s atrocious currency debasement. So, according to their own rigged CPI metric, has the Fed accomplished its inflation goal? Nope.

They didn’t even reach their totally arbitrary 2% CPI target before they declared a fake victory. By the way, targeting 2% inflation is a nonsensical concept. Inflation is poisonous at any level. Think of it like a bucket that continuously leaks 2% of the water it carries.

That’s the kind of outcome the clowns at the Fed are trying to engineer for the economy—but they couldn’t even do that.

In short, the Fed’s narrative that inflation has been defeated is so laughably ridiculous that the only explanation is deliberate deception.

Here’s a way to think of it.

Imagine you used to weigh 180 pounds in 2019. In 2020, you gained 10 pounds and are now 190 lbs. In 2021, you gained 25 pounds and are now 215 lbs. You tell concerned friends and family not to worry about your weight gain because it’s just “transitory.”

In 2022, you go on a diet but still gain 20 pounds. You are now 235 lbs. In 2023, you continue on your diet and gain 10 pounds. You are now 245 lbs. In 2024, you have gained 5 pounds so far and are now 250 lbs.

The rate at which you gain weight is down, but your weight has increased around 40%, from 180 lbs to 250 lbs. You now declare victory, end your diet, and go back to the lifestyle that caused the weight gain surge in the first place.

This is the same kind of “victory” the Fed is declaring with inflation and the money supply, which also grew around 40% over a similar period.

In short, they are gaslighting people and spewing propaganda. So, why are they attempting to deceive people? Nobody knows for sure except them.

But if I had to guess, they are desperately trying to conceal the massive economic destruction they have already caused and the coming destruction they will cause, which could be much worse than anything we’ve seen so far.

It could all go down soon… and it won’t be pretty. It will result in an enormous wealth transfer from savers to the parasitical class—politicians, central bankers, and those connected to them.

Unfortunately, there’s little any individual can practically do to change the course of these trends in motion.

The best you can and should do is to stay informed so that you can protect yourself in the best way possible and even profit from the situation.

That’s why I just released an urgent new PDF report with all the details.

It’s called The Most Dangerous Economic Crisis in 100 Years… the Top 3 Strategies You Need Right Now.

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However, the Bureau of Labor Statistics published the latest CPI at 2.9%, despite annual inflation being 1.4% when she took office. Inflation is a disguised tax and accumulated inflation since January 2021, when the Biden-Harris administration started, has increased more than 20%.

Of course, Democrats blame inflation on the war, the pandemic, and the science-fantasy concept of “supply chain disruptions.” No one believed it, because most commodities have declined and supply tensions disappeared back to normality, but prices continued to rise.

As a result, Harris invented the concept of greedy grocery stores and evil corporations to blame for inflation and justify price controls. Is it not ironic? She blames grocery stores and corporations for inflation, but when price inflation drops, she proudly takes credit.

The reality is that the Kamala Harris plan, like all interventionist governments, creates and strives for inflation. Inflation is a hidden tax. Governments love it and perpetuate it by printing money through deficit spending and imposing regulations that harm trade, competition, and technological creative destruction. Big government is big inflation.

Inflation is the way in which the government tricks citizens into believing that administrations can provide for anything. It disguises the accumulated debt, quietly transfers wealth from the private sector to the government and condemns citizens to being dependent hostages of government subsidies. It is the only way in which they can continue to spend a constantly depreciated currency and present themselves as the solution. Furthermore, it is the perfect excuse to blame businesses and anyone else who sells in the currency that the government creates.

Kamala Harris will do nothing to cut inflation because she wants inflation to disguise the monster deficit and debt accumulation. In the latest figures, the deficit has soared to $1.5 trillion in the first ten months of the fiscal year. Public debt has soared to $35 trillion, and in the administration’s own forecasts, they will add a $16.3 trillion deficit from 2025 to 2034. It is worse. The previously mentioned figure does not include the $2 trillion in additional debt coming from Kamala’s economic plan.

Harris is aware that her proposals to impose an unrealized capital gains tax, an economic aberration, and other tax hikes will not generate the $2 trillion in additional taxes she seeks. So, she needs the Fed to monetize as much as possible, eroding the US dollar’s purchasing power and making all Americans poorer in the process, only to blame corporations and grocery stores later. Furthermore, it is a way to present the government as the solution to the problem they create, promising the lunacy of price controls and enormous subsidies in a constantly depreciated currency.

It is a perfect plan to nationalize the economy in the style of Peronist socialism in Argentina.

Increase spending, deficits, and debt, making the size of government larger on the way in. Monetize as much debt as possible and cut rates to make it easier for the bankrupt government to borrow. When deficits balloon and inflation soars, increase taxes to the private sector and hike rates, which increases further the size of government in the economy. And you blame corporations?

Governments do not reduce prices. Governments create and perpetuate inflation by printing currency that loses value every year.

Corporations, landlords, and grocery stores do not create or increase inflation; they reduce it through competition and efficiency. Even if all corporations, grocery stores, and landlords were evil and stupid at the same time, they would not make aggregate prices rise and consolidate a constant trend of increases. For the same quantity of money, even a monopoly would not be able to increase aggregate prices. The only one that can make aggregate prices rise, consolidate, and continue increasing, although at a slower pace, is the government issuing and printing more currency than the private sector demands.

By admitting that the deficit will soar by $16.3 trillion in ten years in a budget that expects record revenues, no recession, and continued employment growth, the Harris team is conceding that they will strive for inflation to dilute the currency in which that debt is issued… and make you poorer.

Interventionists argue that the government does not have a budget constraint, only an inflation constraint, and can always tax the excess money in the system. Beautiful. This implies an increase in the size of the government during periods of economic expansion and further government expansion during periods of perceived normalcy. The government receives an enormous transfer of wealth from the productive sector, resulting in the creation of a dependent citizen class.

High taxes are not a tool to reduce debt. High debt and high taxes are tools to confiscate the productive sector’s wealth and create a subclass of dependent citizens.

Socialism redistributes middle-class wealth to bureaucrats, not rich to poor.

Massive government spending, constantly increasing taxes, and printing money. A plan to reduce the economy to serfdom.

Harris’ economic plan is not aiming to reduce inflation but to perpetuate it. Indeed, this economic policy mirrors Argentina’s 21st-century socialism, and it threatens the US dollar’s status as the world’s reserve currency. The government does not determine the level of confidence in a currency. When confidence in a currency declines, it does so quickly. Saying it will not happen in the US because it has not occurred yet is the equivalent of driving at 200mph and saying, “We have not killed ourselves yet; accelerate.”.

About the Author

Daniel Lacalle (Madrid, 1967). PhD Economist and Fund Manager. Author of bestsellers “Life In The Financial Markets” and “The Energy World Is Flat” as well as “Escape From the Central Bank Trap”. Daniel Lacalle (Madrid, 1967). PhD Economist and Fund Manager. Frequent collaborator with CNBC, Bloomberg, CNN, Hedgeye, Epoch Times, Mises Institute, BBN Times, Wall Street Journal, El Español, A3 Media and 13TV. Holds the CIIA (Certified International Investment Analyst) and masters in Economic Investigation and IESE.