Consumer Prices Hot Again

“..that our Keynesian central bankers think inflation is good for everyday Americans and therefore relentlessly strive to generate more of it is one of the great follies of the present era.“

 -David Stockman

A lot of mainstream financial journalist could have taken some time off.  (In fact, we think the public would be better informed if a lot of them took a very long time off!)

When the Consumer Price Index numbers were reported last month many of them told us that “inflation is running hotter than expected.”

Now, with new numbers just out from the Bureau of Labor Statistics, they can just re-run their old stories while they enjoy time in Cape Cod or the Hamptons.  Because once again, “inflation is running hotter than expected.”

Our question is this:  Who is setting their expectations?  After all, the CPI has it has been trending up every month since January.  

They might have considered the Fed’s topsy-turvy policy of keeping interest rates below the inflation rate.  Have financial journalism’s Keynesian blinders kept them from noticing? 

And if that is not enough of a clue, maybe they should have noticed the little, old $4 trillion in Fed money printing since late 2019.  Do they think that the authorities can print all that money without consequences?

Here is the latest “unexpected” CPI news.  In May, consumer prices rose 0.6 percent.  That is after a 0.8 percent increase in April.  

It amounts to a 5 percent increase in consumer prices over the past 12 months.  The increases over the past two month would produce an annual rate of more than 8 percent.  In any case, it is the largest 12-month increase since August 2008.  

It was only weeks after that surge in consumer prices that gold and silver exploded to the upside.  Accordingly, we think this would be a good time to update your gold and silver portfolio.  

Because after all, what is headed our way shouldn’t be unexpected.