Posted on 06/27/2021 2:51:47 AM PDT by Freedom'sWorthIt
WASHINGTON — Consumer spending was flat in May with incomes dropping for a second month as the impact of the government's pandemic stimulus payments waned. Inflation, however, posted a sizable gain with prices excluding food and energy jumping by the largest amount in nearly three decades.
The flat reading for consumer spending in May represented a marked slowdown following gains of 0.9% in April and a 5% surge in March, the Commerce Department reported Friday. The spending surge in March had been fueled by distribution of payments of up to $1,400 per individual from a $1.9 trillion stimulus bill, the Commerce Department reported Friday.
With those payments winding down, incomes fell by 2% in May after an even bigger drop of 13.1% in April. Wages and salaries, the key component of income, were up 0.8% in May, reflecting rising employment levels.
Inflation tied to a gauge of consumer spending that is closely watched by the Federal Reserve increased 0.4% in May and is up 3.9% over the past 12 months. That was the largest 12-month increase since 2008 and well above the Fed's 2% target for annual price increases.
Core inflation, which excludes volatile food and energy costs, rose 0.5% in May and is up 3.4% over the past 12 months, the biggest jump since 1991.
These sharp price gains have raised worries that runaway inflation could become a threat, something not seen in this country since the oil shocks of the 1970s.
(Excerpt) Read more at wral.com ...
Incomes dropping / inflation growing
Core inflation, which excludes volatile food and energy costs
Yet it is those costs that hit everyday people in the face.
[Yeah, I understand the reason to exclude them...]
Only the government can take perfectly good ink and paper and turn them into worthless currency.
Disincentivize work, distribute hundreds of billions in free money, and watch the magic.
The old saying goes that economists only know how to make two things, shortages and surpluses. (Control the price of a commodity below its market price and you create a shortage. Above its market price and you create a surplus.) But that’s not fair, they also know how to create inflation. Simply increase the money supply faster than productivity, voila, you’ve created inflation.
The people who did this knew it would happen. They must figure that the short term electoral appeal of free money outweighs the long term economic damage.
Capital strike is a way to address rising prices.
what is that
“UNEXPECTED!”
And Wall Street responded Friday with substantial gains.
More of the main-street vs Wall Street disconnect.
Doesn’t matter - the RCP “poll” has Clueless Joe with an approval rating at 59% - the senile old fool can do nothing wrong in the eyes of the American sheep.
blockquote>Obviously we need Guaranteed Basic Income to drive the economic recovery! /sarc</blockquote
that is sick
Looken sharp Democrats.
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