The following cause inflation of the Biden administration.
1. His distribution of the almost $ 6 trillion stimulus to the people with income below $75,000 for single, and below $150,000 for married couple filing jointly.
2. The continued lucrative payment to non-working people unemployment insurance, instead of requiring them to work and produce.
3. More of demands than supplies due to lack of production since people refuse to go back to work while consuming and receiving lucrative insurance benefits.
4. Rise of oil/gas prices due to closures of pipelines that deliver gas to the different parts of the country.
5. Closures of oil and gas drilling from all parts of the country.
6. More demands of used cars because the brand new cars get so expensive due to more controls put up to minimize gas consumptions, and due to manufacture of more electric cars which are impossible to be afforded to average income Americans.
7.Massive increase on property taxes to homeowners due to demands of cost on cities and states as a result of the Biden's millions of illegal distributions throughout the entire US states.
Scarce employees, even employers pay $500 to applicants who hand them resumes. Wages are increased to attract workers. Recovery of these businesses could be slow unless full time operation is in place.
It is like the reminiscence of the Carter administration during the 70's when we had to line up hours at the gas stations, to pump gas at a very expensive price.
Interest rates during the Carter era reached from 14% to 18% for buying homes.
We have not been there yet. But did you notice that current home prices skyrocketed, and average homes now cost almost a million dollars.
Living in a home is too expensive due to maintenance cost. That is what I am spending enormous cost for staying alone in this huge home with a cat. I don't care. I feel safe and comfortable. That is most important for me,
The worst that could happen is when Biden finally increase taxes. He has not started that yet and president Trump's low tax rate is still in effect. Thus economy is still doing well along with the stock market.
Biden's National Debts has now reached $31 trillion. The $6 trillion he is anticipating to spend is not yet included there.
Once Biden puts up his tax increases, watch out. We will all take the pain pill.
Prices Rise at Fastest Pace in Years, Fueling More Inflation Fears
BY EMEL AKAN June 10, 2021 Updated: June 10, 2021
WASHINGTON—U.S. inflation in May rose 5 percent from a year ago, recording the biggest annual spike since 2008 as supply bottlenecks and surging household demand continue to push prices higher.
While transitory factors continue to lift prices, the economy sees more signs of continuing inflationary pressures, according to analysts, which may point to persistently high inflation.
The Labor Department announced that the consumer price index increased 0.6 percent in May on a monthly basis, just above the consensus forecast of 0.5 percent.
The rise in used car prices accounted for about a third of the increase in overall inflation. Prices for used cars and trucks jumped 7.3 percent in May, following a 10 percent increase in April, as global semiconductor shortages continue to affect new car production. This put “used car prices up at more than a 170 percent annualized pace over the past two months,” according to Morgan Stanley.
Airfares were also up 7 percent, and rental car prices jumped another 12 percent last month.
Food prices rose 0.4 percent and energy prices remained flat in May. Analysts, however, expect a further increase in food prices in the coming months.
Core inflation, which excludes the volatile food and energy components, is up 3.8 percent over the past year—the largest gain in 28 years.
The sharp jump in the year-over-year inflation number is partially due to the base effect, as the pandemic lockdowns and the plunging economy caused weak consumer inflation a year ago. The base effect is expected to level off in June.
In March, the central bank raised its inflation projection for 2021 to 2.4 percent, up from the 1.8 percent projected earlier. Fed officials have repeatedly said price increases are “transitory,” with the expectation that inflation will eventually return to the central bank’s 2 percent target.
Recent inflation data, however, may require the Fed to revisit its inflation forecasts.
“The outsized gains in a few select sectors support the Fed’s view that the current degree of price pressures is temporary,” Sarah House, senior economist at Wells Fargo Securities, wrote in a report. “However, we see signs of inflationary pressures broadening out, which we believe will keep monthly price gains from merely falling back to their pre-pandemic trend after the current flurry of activity.”
Restaurants and groceries have started to raise their prices as they face increasing food and labor costs. Agricultural commodity prices surged about 60 percent over the past year, reaching a decade high, according to Wells Fargo. And average hourly earnings at restaurants have increased 24.4 percent at an annualized rate in the past three months, as business owners scramble to fill open job positions.
Ellen Zentner, chief U.S. economist at Morgan Stanley, said persistent inflationary pressure could be greater than expected this year.
“What was most notable in this report is that while transitory factors did a lot of the heavy lifting driving the May upside, the more persistent components like rents and OER [owner’s equivalent rent] firmed up as well much more than expected,” she wrote in a report.
OER, which is used to estimate shelter cost (a monthly rent that would be equivalent to the monthly expenses of owning a house), rose 0.31 percent in May, the largest increase since June 2019. And rents increased 0.24 percent, the largest since March 2020, according to Morgan Stanley.
“I think it’s going to be more persistent than transitory,” Joseph Carson, a former Alliance Bernstein and Commerce Department economist, told NTD TV.
“You have a lot of factors pushing it up, like monetary policy, fiscal policy, pent up demand, worker shortage, wage increases.”
Carson also noted that the current business cycle is “quite unusual.” Unlike previous recessions, unique features of this recovery cycle include low inventory levels and wage inflation, which are driving prices higher.
One of the world’s largest consumer goods corporations, Procter & Gamble, announced that it would raise prices for its baby, feminine, and adult care products.
David Taylor, CEO of Procter & Gamble, said at a virtual conference hosted by Fortune that inflation is “inevitable.”
“Yes, it is very real. We are seeing it across a number of products. It’s pulp, it’s paper, it’s anything involving oil. Plastic packaging is going up. Trucking costs have gone up significantly. Ocean freight has gone up significantly. You are seeing it in a wide range of cost areas.”
Tom Ozimek contributed to this report.
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