Yesterday the Federal Reserve raised interest rates another 25 basis points, a move that was widely expected and priced into the markets for many weeks in advance.
Interest rate are now officially at 4.75%.
The federal CPI inflation numbers are now sitting at 6.5%.
However Shadow Stats reports that it is more like 10% – 15% when factoring in more information.
During the Fed’s FOMC meeting yesterday, Chair Jerome Powell indicated that perhaps a couple more smaller rate hikes are on the way and that the Fed would hold rates there for a while. Powell pretty much ruled out any notion that the Feds would cut rates at all this year.
We covered a lot of ground, and the full effects of our rapid tightening so far are yet to be felt. Even so, we have more work to do.
Reducing inflation is likely to require a period of below-trend growth and softening of labor market conditions. Restoring price stability is essential to set the stage for achieving maximum employment and stable prices over the longer run.
The historical record cautions strongly against prematurely loosening policy. We will stay the course until the job is done.
Powell said in his opening remarks
The Federal Reserve and mainstream economists have been using an uncommon term as of late called “disinflation.” This simply means that inflation still continues to persist and remain elevated but is not rising as fast as it once was. Powell used that same verbiage yesterday.
I would say it is a good thing the disinflation we have seen so far has not come as the expense of a weaker labor market, but I would also say the inflationary process you see under way is really at an early stage.
Powell added
You can read more about it here.
AUTHOR COMMENTARY
The rich ruleth over the poor, and the borrower is servant to the lender.
Proverbs 22:7
If what Powell and the Feds say are somewhat true, it greatly looks like the Feds will raise rates to 5% or 5.25%, and then pause. And then they will keep it locked there for the rest of the year, unless something dramatic changes.
This is crucial because inflation is not stopping nor can it, and by having interest rates sitting below the fake CPI numbers but still elevated, it means that the consumer will get crushed even more because the price to borrow will be really more as inflation rises.
The Feds are determined to squeeze out that last drop of blood from the turnip and inflict the most damage that they can, as it creates greater and greater dependency on the system and into their trap.
[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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The rich ruleth over the poor, and the borrower is servant to the lender.
Proverbs 22:7
why not one of his own children, Jacob?
is it because prophecy needs to be fulfilled ?
It’s a shame, but Americans have set back and allowed a small group of criminal bankers to run the finances of the country since 1913. The Fed is directly responsible for the biggest ponzi scheme ever perpetrated on the American people.