Great and Sobering tidbits by POMP on inflation...
Inflation in the United States was reported at 8.6% this morning. This is the fastest year-over-year growth in over 40 years. The most concerning part of this report is that economists and market analysts believed that inflation had peaked in March at 8.5% and was going to start trending downward in April and May.
We saw 8.3% in the April report, but the May numbers surprised these “experts” to the upside. Inflation hasn’t peaked and is continuing to accelerate higher. There is plenty of debate on why inflation is occurring. Is it undisciplined monetary and fiscal policy? Is it supply chain disruptions? Is it the Russia-Ukraine conflict? The economy is a complex machine, so each of these situations likely plays a role.
Rather than debate how we got here, we need to be focused on what can we do moving forward. The average American family is getting decimated financially right now. The cost of eating food at home has increased 11.9% over the last 12 months. Gasoline is up nearly 50% in the same time frame. That is almost impossible for a family to withstand, especially when wages aren’t growing at the same rate.
But this data is not telling the full story. Take gasoline as an example — prices have doubled in the last 18 months.
If you look at shelter, it is being reported at a 5.5% annual increase. That doesn’t make a lot of sense though. Rents are up more than 15% nationally and real estate is up more than 20%. The lower official number is the result of methodology that doesn’t accurately reflect reality.
There are other measurements of inflation that we can look at. Truflation is a private market attempt to more accurately measure inflation and they are reporting just under 11% over the last 12 months.
The cost of goods and services are increasing, while wages are not keeping pace. This is disastrous for millions of families.
