The Federal Reserve has finally raised interest rates since 2018, and the media is cheering, while many economists are still bamboozled as to how the market went higher on the news.
After being at nearly 0%, the Fed has now raised rates from .25% to .50%.
Federal Reserve Chair Jerome Powell said,
I guess I would say the expectation still is that inflation will come down in the second half of this year, but we still expect inflation to be high this year.
Additionally, Powell stated the U.S. economy is strong:
The labor market has a lot of momentum and the underlying economy is strong.
The good news is that the economy and labor market is quite strong, can handle interest rate increases.
Moreover, he said,
We anticipate inflation will move back down.
Readers of The WinePress may recall that going back over a year ago, U.S. Treasurer Janet Yellen – a former Fed Chair President herself – and Jerome Powell said that inflation was only “transitory,” and their goal was to keep inflation at 2%.
Currently, the official inflation rate is at 7.87%.
However, alternative metrics depict inflation to be basically double that, when factoring other data points that the government does not.
In short summary, stock market anaylst and expert Gregory Mannarino reacted to the Fed’s move by stating:
The Fed cannot stop inflation by simply raising rates … by 25 basis points .. [Powell] might as well [have] done this: [flicks his notepad quite softly].
The WinePress reported in January of this year that Mannarino said that the rate hikes we will see throughout the year will not stop anything, and inflation will continue to rip higher.
AUTHOR COMMENTARY
The rich man’s wealth is his strong city: the destruction of the poor is their poverty.
The rich ruleth over the poor, and the borrower is servant to the lender.
Proverbs 10:15, 22:7
Disregard everything Powell, politicians, and media says. Regulars of the WP already knew long in advance, before this year, the economy is broken beyond repair and is already dead, and simply on life support.
It’s very quite simple: you cannot print money to infinity and expect inflation to slowdown even for a second. This is the core driver to the problem, everything else is just supplementary, but the media refuses to let you know the core reason why inflation will not stop.
However, if the Fed actually stops inflating their balance sheet, the markets would suffer severely and the real economy would feel it too. Moreover, if they raise rates in a meaningful way, one that would actually put a dent in inflation, the economy would simply just melt away at that point.
In short, stay out of debt, and continue your preparations, and do what you need to do to get yourself in the right positions to best prepare for continued financial woes.
The Quickest Way To Know The Economy Is Broken Beyond Repair
[7] Who goeth a warfare any time at his own charges? who planteth a vineyard, and eateth not of the fruit thereof? or who feedeth a flock, and eateth not of the milk of the flock? [8] Say I these things as a man? or saith not the law the same also? [9] For it is written in the law of Moses, Thou shalt not muzzle the mouth of the ox that treadeth out the corn. Doth God take care for oxen? [10] Or saith he it altogether for our sakes? For our sakes, no doubt, this is written: that he that ploweth should plow in hope; and that he that thresheth in hope should be partaker of his hope. (1 Corinthians 9:7-10).
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