Inflation wake-up call

Never trust a statistic you haven’t fudged yourself.

Unsurprisingly, inflation in the U.S. continues to rise, which by now even the last citizen at the supermarket shelf should have noticed. Official CPI figures say inflation has risen to 5.4% YoY in September from 5.3 in the previous month.

Some numbers from the CPI:

Meat, poultry, fish, and eggs up 10.5%.
Energy up 24.8%
Energy commodities up 41.7%
Fuel oil up 42.6%
Gasoline (all types) up 42.1%
Natural gas (piped) increased by 20.6%

Food inflation, energy inflation, and housing inflation are all just words to distract from the actual inflation term. The term inflation comes from monetary policy and when the number of currency units is increased it is called monetary inflation. Rising prices are the result of monetary inflation, as an increased amount of currency chases the same amount of goods. At the moment, there is still a shortage of goods, which makes the situation even worse.
Since in recent years the printers at the Federal Reserve have been running at full speed, pumping trillions of U.S. dollars into the market, inflation can only increase.

Number of unemployed on the rise – stagflation on the doorstep

Recent health care regulations have put hundreds of thousands of people out of jobs. High inflation + high unemployment = stagflation

Assuming we can trust the labor market numbers the unemployment numbers are still far above the Fed’s targets. Coupled with rising inflation, the Fed is probably starting to find itself in a corner.

After the announcement of the CPI figures, the gold price could make decent gains and is late in the evening in Asia at $1,795.40 per ounce.

The silver price could also gain to $23.25 per ounce.

Since gold and silver have their glory hours when people worry about their purchasing power, it would not be surprising if we see the gold and silver prices soon at a new all-time high.

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