Tag Archives: Federal Reserve

The Trump Economy Booms

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On Thursday, Breitbart posted an article about improved labor productivity in America.

The article reports:

U.S. labor productivity accelerated sharply in the third quarter of 2025, rising at a 4.9 percent annual rate as workers contributed more output per hour worked, the Bureau of Labor Statistics reported Thursday.

The figure substantially exceeded economist expectations of 3.6 percent and marked the strongest quarterly gain in two years. Combined with an upwardly revised 4.1 percent increase in the second quarter, the back-to-back performance suggests American businesses are adapting to tighter labor markets by investing in efficiency rather than pursuing the low-cost labor strategies that dominated much of the past two decades.

This is good news for American workers.

The article concludes:

The consecutive strong quarters in mid-2025 follow a weak first quarter when productivity fell 2.1 percent and unit labor costs surged 7.3 percent at the tail end of the Biden administration. That volatility is typical in quarterly data, but the trend over multiple quarters now points clearly toward sustained productivity acceleration.

The productivity gains carry significant implications for the economy’s inflation outlook. The Federal Reserve closely monitors unit labor costs as an indicator of wage-driven price pressures. With these costs now declining, the data removes a potential concern that could have complicated the Fed’s policy decisions.

The figures also suggest the economy may be capable of sustaining higher levels of output growth without generating inflation, since businesses are producing more from each hour of work rather than simply adding expensive labor inputs.

The government will release December employment data on Friday, providing additional insight into whether the labor market dynamics driving productivity gains are continuing into the final months of 2025.

Despite what the ‘experts’ are telling you in the mainstream media, President Trump’s economic policies are working. Not only are they working, they are helping average Americans who work for a living.

Senator Fetterman has pointed out that we should all be rooting for America to succeed, because when America succeeds, we all succeed.

To quote the prophet Jeremiah:

Jeremiah 29:7 7 Also, seek the peace and prosperity of the city to which I have carried you into exile. Pray to the LORD for it, because if it prospers, you too will prosper.”

The Trump Economy

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On Tuesday, CNBC posted an article reporting that the U.S. economy grew by 4.3% in third quarter, much more than expected (the mainstream media always has low expectations during a Republican administration).

The article reports:

The U.S. economy grew at a much greater-than-expected pace in the third quarter, boosted by strong consumer spending, a delayed report released Tuesday showed.

U.S. gross domestic product, a sum of all goods and services produced in the sprawling U.S. economy, expanded by 4.3% in the July-September period, the Commerce Department said in its initial reading of third-quarter growth. Economists polled by Dow Jones expect a gain of 3.2%.

Consumer spending expanded by 3.5% in the third quarter after rising 2.5% in the second quarter.

Increases in exports and government spending also boosted growth, while a smaller dip in private fixed investment helped as well.

The report originally had been scheduled for release on Oct. 30 but was delayed by the government shutdown. This release also replaces a second estimate that was set to drop on Nov. 26. The department’s Bureau of Economic Analysis will release one final estimate later.

A measure of growth called real final sales to private domestic purchasers rose 3% in the quarter, up 0.1 percentage point from the prior period. Federal Reserve policymakers watch the data point closely for signs of consumer demand.

When gas at the pump is $1 less a gallon or more, people have more spending money and don’t feel the pressure of inflation quite as much. If you put 15 gallons of gas in your car every week, you have saved $60 a month without doing anything. The lower price also encourages people to travel and spend a little more freely than they otherwise might. Unfortunately, the price of diesel fuel has remained high.

Goods News For The America Economy

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On Thursday, The Epoch Times posted an article about the unemployment numbers released for last week. Some of the economic statistics for October and November have not been released because of the government shutdown. I am not sure if they are going to be released.

The article reports:

The number of Americans filing for first-time unemployment benefits declined to the lowest level in more than three years, new Department of Labor data released on Dec. 4 show.

For the week ending Nov. 29, initial jobless claims fell by 27,000 to 191,000, marking the fourth consecutive weekly drop.

Economists had penciled in a reading of 220,000.

Notice how the economists’ estimates are always more negative than the actual figures when a Republican is in office.

The article notes:

But while slowing layoffs and declining jobless claims have been positive signs, the futures market overwhelmingly expects the Federal Reserve to lower interest rates when monetary policymakers convene their two-day policy meeting next week.

Minutes from the October Federal Open Market Committee meeting reveal a divergence in views of where monetary policy is headed. Commentary from central bank officials also suggests different assessments of the U.S. economy.

“From late spring through June, the soft data, including anecdotes from business contacts, suggested the labor market was in a ‘no hire, no fire’ equilibrium,” Fed Gov. Christopher Waller said in a speech last month. “Firms repeatedly said they were holding off on hiring for a variety of reasons.”

Waller, considered a top contender to replace Fed Chair Jerome Powell next year, supports a quarter-point rate cut to the benchmark federal funds rate.

Cleveland Fed President Beth Hammack has expressed skepticism over further rate cuts, warning of high inflation.

“I remain concerned about high inflation and believe policy should be leaning against it,” Hammack said at a Nov. 6 Economic Club of New York event.

The headline annual inflation rate presently sits at 3 percent. The Fed’s preferred inflation measure—the personal consumption expenditure price index—is at 2.7 percent.

Somehow inflation was not a worry when the rates were cut during the Biden administration. Considering how much the rate of inflation has dropped, I think it is time to cut the rates and let the housing market loose.

What History Says vs. What The Media Says

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On Friday, Breitbart posted an article about what the historical data says about the impact of tariffs.

The article reports:

A sweeping new analysis of tariff policy spanning 150 years suggests that the economic establishment may have fundamentally misunderstood how tariffs affect prices and employment, a finding with profound implications for understanding President Donald Trump’s trade policy and the proper response by the Federal Reserve.

Researchers at the Federal Reserve Bank of San Francisco examined major tariff changes from 1870 through 2020 across the United States, the United Kingdom, and France. Their conclusion challenges the conventional wisdom that dominated economic policy debates in recent years: when countries raise tariffs, prices actually fall, not rise.

The article concludes:

More importantly, the study removes the most potent intellectual weapon from the free-trade arsenal: the claim that tariffs inevitably raise consumer prices. For generations, this assertion ended policy debates before they could begin. Policymakers considering tariffs faced the accusation that they were imposing a regressive tax on consumers. Kamala Harris, in her failed bid for the presidency last year, repeatedly described Trump’s tariff proposals as a national sales tax that would increase consumer prices. Now that idea lies in tatters.

With the consumer price argument dismantled, the debate over tariffs can proceed on grounds better rooted in economic history and national purpose. Policymakers can weigh the benefits of protecting domestic industries, rebalancing trade relationships, and rebuilding manufacturing capacity against the effects on economic activity and employment. They can consider whether tariffs might encourage productive investment and industrial development, questions that have been largely off-limits in mainstream economic discourse.

The paper’s findings also call into question the Fed’s response to tariffs. If the main effects are lower inflation and higher lower employment, monetary theory would suggest that the Fed should cut interest rates when tariffs are imposed. Instead, the Fed this year took the opposite course, holding interest rates steady and only cutting hesitantly—moves that now look like a major policy mistake.

Unfortunately, in recent years, cutting interest rates has more to do with politics than economic data. When someone the fed likes is President, interest rates move lower quickly and stay low if at all possible (however, if inflation becomes too high and too obvious, they will raise them). When someone the deep state dislikes is President, interest rates tend to be lowered very slowly if at all.

Filling Out The Board Of Governors At The Fed

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On Wednesday, Breitbart reported that the Senate Banking Committee has approved the nomination of Stephen Miran to fill the vacancy on the Board of Governors of the Federal Reserve created when Andrea Kugler unexpectedly announced she would resign prior to the end of her term in January.

The article reports:

The committee voted 13-11 along party lines to advance Miran’s nomination to the full Senate, where it is expected to come up for a vote on Monday.

That would put Miran in place to vote at the Federal Open Market Committee meeting on September 16 and 17. The FOMC is widely expected to announce an interest rate cut at the conclusion of that meeting.

…President Trump could nominate Miran to fill the subsequent 14-year term but he would need to be confirmed again by the Senate. Alternatively, Trump could appoint someone else to the seat, perhaps someone he expects to elevate to the chairmanship of the Fed later this year when Jerome Powell’s tenure expires. Miran would be able to hold the post until a new nominee is confirmed.

Miran currently chairs the White House Council of Economic Advisers. He told senators at his confirmation hearing that he would take an unpaid leave of absence from that position while working at the Fed. Democrats attacked this arrangement, claiming it would compromise the independence of the Fed. Many Fed officials take similar leave of absence from private sector jobs while serving on the Fed but those have mostly been academic positions rather than roles in the White House.

I hate to be cynical (but I’m good at it!), but the Democrats would have found some way to attack the nomination and the arrangement proposed regardless of the details. The Democrats have created the greatest logjam in American history in the nomination process for President Trump’s nominees. I think I would have been surprised if they hadn’t objected.,

Some Good News About The Economy

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On Wednesday, CNBC reported the following:

  • Gross domestic product jumped to 3% for the second quarter, better than the 2.3% estimate and reversing a 0.5% decline in the prior period.
  • Consumer spending rose 1.4% in the second quarter, better than the 0.5% in the prior period.
  • While exports declined 1.8% during the period, imports fell 30.3%, reversing a 37.9% surge in Q1.
  • President Donald Trump responded to the GDP report with a fresh demand for the Federal Reserve to lower interest rates.

In another article posted on Wednesday, CNBC reported:

  • Private payrolls rose by a seasonally adjusted 104,000 for the month, reversing a loss of 23,000 in June and topping the Dow Jones forecast for an increase of 64,000.
  • Wages rose at a 4.4% annual pace for the month, about in line with recent trends.

The first article mentioned reports:

The U.S. economy grew at a much stronger-than-expected pace in the second quarter, powered by a turnaround in the trade balance and renewed consumer strength, the Commerce Department reported Wednesday.

Gross domestic product, a sum of goods and services activity across the sprawling U.S. economy, jumped 3% for the April through June period, according to figures adjusted for seasonality and inflation.

That topped the Dow Jones estimate for 2.3% and helped reverse a decline of 0.5% for the first quarter that came largely due to a huge drop in imports, which subtract from the total, as well as weak consumer spending amid tariff concerns.

Financial markets reacted little to the report, with stock index futures mixed and Treasury yields higher.

“The word of the summer for the economy is ‘resilient,’” said Heather Long, chief economist at Navy Federal Credit Union. “The consumer is hanging in there, but still on edge until the trade deals are done.”

The second article reports:

Hiring at private companies rebounded at a stronger than expected pace in July, indicating the labor market is holding its ground, ADP reported Wednesday.

Payrolls rose by a seasonally adjusted 104,000 for the month, reversing a loss of 23,000 in June and topping the Dow Jones forecast from economists for an increase of 64,000. The June number was revised up from an initially reported loss of 33,000.

Though the pace of hiring is well off where it stood last year, the June total was the best since March and consistent with a slowing but still fairly vibrant jobs picture.

“Our hiring and pay data are broadly indicative of a healthy economy,” ADP chief economist Nela Richardson said. “Employers have grown more optimistic that consumers, the backbone of the economy, will remain resilient.”

At the present time, it looks as if hiring a businessman as President was a good choice for the economy.

Reining In The Federal Reserve

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Author:  R. Alan Harrop, Ph.D.

 President Trump is engaged in an ongoing struggle with Jerome Powell, the head of the Federal Reserve (Fed) over interest rates. Interest rate levels are set by the Fed and have a substantial impact on the growth of the economy and the national debt. President Trump believes that economic growth is essential for the security of the country but also essential to making America Great Again.  It is important to note that Jerome Powell was not elected by the people whereas President Trump was. Consequently, this issue is directly relevant to whether power belongs to the people as intended by the Founding Fathers or to appointed bureaucrats.

 Historically, the Federal Reserve (essentially the national bank), did not exist until it was created in 1913 as a result of a secret meeting of bankers who drafted the legislation in Jekyll Island, Georgia. The bill creating the Fed was signed into law by Democrat president Woodrow Wilson, who was a leftist. President Andrew Jackson was instrumental in doing away with the previous national bank during his administration in the 1830s, primarily because he believed the national bank had too much power and that Congress should decide important economic policies. The goal of the legislation creating the Fed in 1913, was to create a more “elastic” currency and control the banking industry by creating 12 member banks making up the Federal Reserve system. They would set interest rates on federal bonds as well as the money supply. Remember, this was a time when there was a heated debate over whether to do away with gold as the basis for our money supply. The paper dollar switched from representing a certain amount of gold or silver (which you could redeem), to faith in the promise of the federal government: the so-called promissory note. If you look at the top line on a dollar bill, it now says “Federal Reserve Note.” I remember in my youth that it used to say “Silver Certificate.” Also, remember that in the 1930s, Democrat president Franklin Roosevelt, required all citizens to turn in their gold coins to the government to be replaced by paper money. What all this tells us is that the Federal Reserve has essentially total control over the monetary system of the country.

One of the main functions of the Fed is to use interest rates to control economic growth as well as inflation. Lower rates encourage businesses to borrow so they can expand, resulting in more hiring. Consumers also buy more since mortgage rates and credit card rates go down. Raising interest rates by the Fed is usually done to decrease inflation since it slows economic growth and spending. Since President Trump has been in office, the inflation rate has dropped substantially, surprising most economic experts. President Trump wants the Fed to lower rates so more people can afford to buy homes and other consumer items, which would result in economic growth. He also knows that lowering interest rates will reduce the amount of payment necessary to service the 37 trillion-dollar national debt, which is approaching one trillion dollars a year.

 The Fed has recently announced that they do not intend to lower interest rates in the near future, which is in direct opposition to the president’s request. Since the people selected President Trump to run the country for the next four years, doesn’t it make sense that he should be able to dictate the interest rates consistent with his agenda?

 If so, Congress needs to rein in the independence of the Federal Reserve so that they act in an advisory rather than decision making authority. If not, what would prevent the Fed from using their existing authority to undermine a president with whom they have political differences? A president should be free to exercise his authority to enact the policies and actions that the people who elected him have reason to expect,

Let’s Get Pivotal!

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There have been many pivotal years in American history, but a few of them have greatly impacted the way the country is run. One of the years that has shaped where we are today with deficits, representatives who do not represent, etc., is 1913. That was the year the Federal Reserve was created, the income tax was instituted and the direct election of Senators was signed into law.

First I want to focus on the Federal Reserve. Despite what Americans were told, the purpose of the Federal Reserve was to make sure that the wealth of America remained concentrated in the major banks of New York City. If you look at the list of people who made the secret trip to Jekyll Island to create the blueprint for the Federal Reserve, that becomes obvious. More information about the gimmicks that were used to sell America on the idea of The Federal Reserve can be found in the book The Creature from Jekyll Island by G. Edward Griffin. The Federal Reserve has done nothing to help the average American, and it can be argued that its existence has hurt the average American financially.

The federal income tax was touted as something that would supposedly only impact the ‘super rich’ top 1 percent of Americans. We see how that went. It is interesting that in 2022, 40.1 percent of households paid no individual income tax. Keep in mind that these are voting eligible Americans who don’t care if politicians raise taxes. Up until 1913, America’s bills were paid by tariff income. Of course we did not have a welfare state at that point. It is also interesting that although the budget deficit went down in 2013, it began to increase again in 2016–government spending somehow always manages to catch up with increased revenue.

The direct election of Senators has done the most damage to our Republic. Prior to 1913, Senators were appointed by their states and could be ousted if they did not represent the interests of their states. The House of Representatives was supposed to be the branch of legislature that was more responsive to the will of the people and would react more quickly. The Senate was supposed to be a more deliberative body that represented the individual states. The direct election of Senators changed that dynamic.

1913 was a pivotal year for America, but not in a good way. We are again at a place where the decisions our leaders make could be pivotal. Do we make the tax cuts permanent or do we have a massive tax increase next year? Do the courts have power over the Executive Branch or can the President hire and fire people, command the military, and demand that the laws be enforced? The answer to those questions will determine whether 2025 and 2026 become pivotal years for America. President Trump is attempting to bring America closer to the ideals of our Founding Fathers. If he succeeds, that will be a good thing. It will also be pivotal.

Every Little Bit Helps

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On Wednesday, CNBC reported that the inflation rate went down in February.

The article reports:

  • The consumer price index for both all-items and core increased 0.2% in February, slightly below expectations.
  • On an annual basis, headline inflation was at 2.8%, while core was at 3.1%. Both also were 0.1 percentage point below the Wall Street consensus and the previous month’s levels.
  • The report provided some relief as consumers and businesses worry about the looming impact tariffs might have on inflation

The article concludes:

“The February CPI (Consumer Price Index) release showed further signs of progress on underlying inflation, with the pace of price increases moderating after January’s strong release,” said Kay Haigh, global co-head of fixed income and liquidity solutions at Goldman Sachs Asset Management. “While the Fed is still likely to remain on hold at this month’s meeting, the combination of easing inflationary pressures and rising downside risks to growth suggest that the Fed is moving closer to continuing its easing cycle.”

The Fed meets next week and is widely expected to hold its key borrowing rate in a target range between 4.25%-4.5%.

Economic growth is trending negative in the first quarter, according to the Atlanta Fed’s GDPNow tracker of incoming data. The measure has pegged Q1 growth at a 2.4% decline, which would be the first negative growth quarter in three years.

I would like to remind everyone that even though President Trump has been ‘flooding the zone,’ we are only less than two months into the Trump presidency. Gas prices are going down and egg prices are going down. Both of those are good things. As far other economic new is concerned, I don’t necessarily believe the initial figures when they come out. Remember the revisions on job creation during the Biden administration. The people who told those lies may still be working for their government, and I suspect their goal is not to make President Trump look good.

The Federal Reserve has not been America’s friend for a long time. It didn’t even start out that way. If you read The Creature From Jekyll Island by G. Edward Griffin, you will find out that the true purpose of the Federal Reserve was to concentrate America’s wealth among the New York City banks. They should lower interest rates slightly, but I doubt they will.

How To Bring Prosperity Back To Average Americans

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The American economy was designed to be based on free market capitalism. Somewhere along the way it began to look more like crony capitalism. That is what I think we have become. So how do we get back to the place where every man has an equal opportunity to become wealthy? Oddly enough, Elon Musk has a few ideas on the subject.

On Tuesday, Townhall reported:

What people actually paying attention know? Is Big Business and Big Government work in tandem – to their ongoing mutual benefit. And the country’s destruction.

Big Business writes laws making Big Government bigger.  Which Big Government then passes.  Bigger Big Government then works to make Big Business even bigger.  Bigger Big Business then writes laws… Lather, rinse, repeat…

Nauseatingly over-remunerated Big Bank employees become Big Government bureaucrats.  Who then help the Big Banks get even bigger.  Then the Big Government bureaucrats are rewarded by becoming nauseatingly over-remunerated Big Bank employees. Who then become…  Lather, rinse, repeat…

To wit: I give you the United States’ financial sector.  The Big Banks are titanic, dominant forces that control great and growing percentages of the market.  The Big Government agencies that allegedly exist to prevent Big Bank abuses?  The Federal Reserve and the Consumer Financial Protection Bureau (CFPB) chief amongst them?  Are titanic, dominant forces that control great and growing percentages of the market.

Together?  They dominate and have destroyed their huge portion of the US economy.

The article reminds us:

Dodd-Frank massively increased the power of the unconstitutional, unaccountable Fed.  And created the unconstitutional, unaccountable CFPB.     

The allegedly “independent” Fed and CFPB have now been so powerful and so unaccountable for so long?  Their bureaucrats respond with anger and revulsion to even the thought of anyone even prospectively reining them in.  

Fed chairman Jerome Powell is a government villain too cartoonish even for Ayn Rand: 

“Jay Powell says Donald Trump couldn’t fire him even if he tried….’Not permitted under the law,’ the central bank chair said Thursday in curt but clear responses to reporters who asked about his views on any legal authorities Trump might have in terms of firing or demoting him or any other top Fed officials.”  

The article concludes:

Which brings us back to the Trump Administration and its DOGE – The Department of Government Efficiency.  

One of the two co-czars of DOGE is Elon Musk.  Who has said some VERY promising things about both the CFPB and the Fed.

Musk Calls for End to CFPB

Elon Musk Reposts Call to End the US Federal Reserve Bank 

Yes, please.  And yes, please.  

The first two letter of DOGE are “DO.”  As in it let’s DO it.  Times two.

Just a reminder:

Political Or Good Policy?

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At a time when Americans are still dealing with inflation, the Federal Reserve has cut interest rates by half a percentage point.

On Wednesday, Breitbart noted:

The Federal Reserve moved to cut interest rates by a half percentage point—the first reduction since the central bank cut rates to near zero when the pandemic struck in 2020—in a vote of confidence that inflation will continue to moderate and an attempt to fend off a further increase in unemployment.

“Recent indicators suggest that economic activity has continued to expand at a solid pace. Job gains have slowed, and the unemployment rate has moved up but remains low. Inflation has made further progress toward the Committee’s 2 percent objective but remains somewhat elevated,” the Fed said in a statement.

…Fed officials have also said that they now view the risks to their mandate to maintain full employment to be greater than the risks of a resurgence of inflation. Earlier this summer, the unemployment rate tripped the Sahm Rule threshold by rising more than a half a percentage point above its recent low, typically a signal that the economy is already in a recession. Claudia Sahm, whose research is behind the rule, has said she does not think the economy is currently in a recession but worries that restrictive monetary policy could unnecessarily increase unemployment even more.

The article concludes:

The longer-run projection for the fed funds rate rose to 2.9 percent, four-tenths of a point above the 2.5 percent the Fed had consistently projected from 2019 through the end of last year. In the June projections, officials had indicated an expectation for a longer run rate of 2.8 percent.

On the other hand, unemployment is now seen as going higher. When the Fed last released projections in June, officials forecast a four percent rate of unemployment at year-end. The new projections have unemployment rising to 4.4 percent. Next year, unemployment is seen as staying at 4.4 percent, up from the earlier estimate of 4.2 percent. Similarly, the median projection for economic growth ticked down to two percent from 2.1 percent this year.

Eleven officials voted for the rate cut. One Fed governor, Michelle Bowman, dissented, preferring a quarter-point cut.

I am not an economist, so I don’t have a lot to say about this. However, I do think inflation has continued to be a problem that cutting interest rates might exacerbate. I am hoping that the Federal Reserve has made the right decision for the right reasons and that this is not a political move.

Who Is The Threat?

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In 1787, Benjamin Franklin responded to a question about the new Constitution with the phrase “a republic, if you can keep it.” Our Founding Fathers envisioned a country with a weak central government and strong state governments. In the early 1900’s a number of things happened that paved the way for a strong central government and weak state governments. The year 1913 was a banner year for those who wanted a strong central government—federal income tax was passed, the federal reserve was created, and the direct election of U.S. Senators was passed. The direct election of U.S. Senators meant that the Senators were no longer subject to recall by their states if they did not represent their state. If a Senator sponsored a bill that would harm his state in some way, the state legislature would recall him. Woodrow Wilson was President when these three things happened. Signing these three things into law significantly shifted the balance of power in America from the states to the central government. The Inflation Reduction Act would never have passed the Senate if Senators were appointed by their states rather than elected.  One illustration of the growth and centralization of government is the fact that in 2023, twenty-five percent of all jobs created were government jobs. We are also in a situation where the majority of our laws are not laws—they are regulations passed by unelected bureaucrats. Any law passed by Congress was probably written by lobbyists. Our tax code is a shining example of what lobbyists can accomplish. According to the Tax Foundation, “There’s the literal statutes that Congress has passed (Title 26 of the U.S. Code). The Government Printing Office sells it spread over two volumes, and according to them, book one is 1,404 pages and book two is 1,248 pages, for a total of 2,652 pages. At perhaps 450 words per page, that puts the tax code at well over 1 million words. (By way of comparison, the King James Bible has 788,280 words; War and Peace runs 560,000 words; and the Harry Potter series is just over 1 million words.)”

The bureaucracy that has been ensconced in America in the past one hundred years or so does not want to give up the power it has co-opted. The biggest current threat to that power is President Donald Trump. He won’t be able to undo a hundred years of unconstitutional behavior in four years, but he will be able to make a beginning. President Trump is a serious threat to our own entrenched bureaucracy, and they are not going to give up their power easily.

President Trump has been accused of being a ‘threat to our democracy.’ First of all, we are a Republic–not a democracy. Secondly, the only threat that President Trump poses is a threat to the entrenched bureaucracy that has perverted the ideas that our Founding Fathers tried to enshrine in our government.

The New Jobs Report

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On Friday, The Epoch Times posted an article about the latest jobs report. The economy is cooling down, which will probably provide the Federal Reserve with an excuse to lower interest rates in the hope of providing a Democrat election victory.

The article reports:

The U.S. economy created fewer jobs than the market projected in August as the overheated labor market of the past few years continues to show signs of cooling off.

Last month, payrolls increased by 142,000, falling short of the consensus estimate of 160,000, according to the Bureau of Labor Statistics (BLS).

The unemployment rate eased to 4.2 percent, down from 4.3 percent in July. This was in line with economists’ expectations.

Average hourly wages surged at a higher-than-expected pace of 0.7 percent, up from a 0.1 percent drop in July—this was revised from the initial report of 0.2 percent growth. Average hourly earnings also climbed to a better-than-expected year-over-year rate of 3.8 percent, up from 3.6 percent.

The labor force participation rate was unchanged at 62.7 percent. Average weekly hours ticked up to 34.3 from 34.2.

Much of the job creation was concentrated in construction (34,000), health care (31,000), government (24,000), and social assistance (13,000).

There were some other interesting numbers in the report:

So far this year, the total number of downward job revisions equals 372,000.

The number of people working two or more jobs increased by 65,000 to 8.538 million.

In August, full-time jobs plummeted by more than 400,000, and part-time employment increased by 527,000.

Inflation is hurting all Americans, and until the government stops its runaway spending, inflation will continue to be a problem.

 

 

This Won’t Be A Surprise To Most Americans

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On Wednesday, The Daily Caller posted an article about the Biden administrations’ reporting of the jobs reporting during the past year or so.

The article reports:

The federal government overestimated the number of jobs in the U.S. economy by 818,000 between April 2023 and March 2024, according to data from the Bureau of Labor Statistics released Wednesday, stoking fears of a slowdown in the U.S. economy.

Economists at Goldman Sachs (GS) and Wells Fargo anticipated the government had overestimated job growth by at least 600,000 in that span, while economists at JPMorgan Chase had predicted a lesser decline of 360,000, according to Bloomberg. The downward revision follows a trend of the BLS overestimating the number of nonfarm payroll jobs added, with the cumulative number of new jobs reported in 2023 roughly 1.3 million less than previously thought as of February 2024

The article concludes:

Wednesday’s downward revision has also heightened concern that the Federal Reserve has waited too long to begin cutting interest rates, Bloomberg reported. If the FOMC hesitates to cut rates for too long, it could result in recession instead of a soft landing — an economic slowdown in which inflation is brought down without causing recession.

The Federal Open Market Committee (FOMC) decided to hold its target federal funds rate between 5.25% and 5.50% in July, marking the eighth meeting in a row the FOMC has decided to keep rates at their current 23-year high.

“Wall Street is increasingly waking up to the fact that the economy post-covid has never been as good as the government bean counters claimed, and a recession may have already begun,” Antoni told the DCNF. “These revisions are a violent shove in the direction of reality.”

The economic rebound has been slowed by government policies that are not totally related to interest rates. Government regulation and tax policy play a big role in America\s economy. If a Democrat is elected President in November, you will see tax rates skyrocket and the economy stumble.

The Rest Of The Story On Inflation

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On Friday, the Associated Press posted an article about the current state of inflation.

The article reports:

WASHINGTON (AP) — Wholesale prices in the United States rose by a larger-than-expected 2.6% last month from a year earlier, a sign that some inflation pressures remain high.

The increase, the sharpest year-over-year increase since March 2023, comes at a time when other price indicators are showing that inflation has continued to ease.

The Labor Department said Friday that its producer price index — which tracks inflation before it reaches consumers — rose 0.2% from May to June after being unchanged the month before. Excluding food and energy prices, which tend to bounce around from month to month, so-called core wholesale prices increased 0.4% from May and 3% from June 2023.

The increase in wholesale inflation last month was driven by a sizable 0.6% rise in services prices, led by higher profit margins for machinery and auto wholesalers.

By contrast, the overall prices of goods fell 0.5%. Gasoline prices tumbled 5.8% at the wholesale level. Food prices also dropped.

The producer price index can provide an early sign of where consumer inflation is headed. Economists also watch it because some of its components, notably healthcare and financial services, flow into the Federal Reserve’s preferred inflation gauge — the personal consumption expenditures, or PCE, index.

Most of the media reported that inflation was slowing based on the producer price index. That number was used to fuel speculation of a federal reserve rate decrease by the end of the year. That likely caused the bump in the stock market yesterday. It’s nice to celebrate a drop in food as fuel prices, but where are they in comparison to where they were four years ago? The Biden administration is hoping you won’t remember.

When Radical Isn’t Radical–It’s Original

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I am not an economist, but I am an observer of the obvious.

In a recent speech, President Trump talked about ending the Income Tax and restructuring the Federal Reserve. Either or both of those things would be good for all Americans and for the American economy.

Before 1913, the United State had neither the Federal Reserve nor the Income Tax. Both measures were passed in 1913. On February 25, 1913, the 16th Amendment (Income Tax) was certified as part of the U.S. Constitution. On December 23, 1913, the Federal Reserve Act created the Federal Reserve.

The men who met at Jekyll Island to create the Federal Reserve represented 25 percent of the wealth of the entire world. They met in secret, and their identities were concealed for many years afterward. Their goal was to keep that 25 percent of wealth in their hands. They created the system for the purpose of keeping New York City banks as the center of America’s wealth. The federal reserve created a system where money could be created out of nothing and loaned out through a leverage system to create interest. For example, over a 30-year mortgage, a bank can earn more from the sale of a house than any contractor who worked on the house.

The Income Tax was supposed to only impact the top 1 percent of Americans. Before 1913, the government’s expenses had been handled through tariffs.

To end the Income Tax, you would have to end the Welfare State. One way to do that would be to tax welfare benefits but not wages. When it becomes more lucrative to work than to collect welfare, it is possible that the work ethic that used to be part of American culture might be revived. You would also have to slash the bloated bureaucracy. The economic boom created by ending the Income Tax would give those who lose their jobs in government a great job market in which to search for new jobs. We need to get rid of any government department that is not successful–has education improved since the Department of Education was created? What has Housing and Urban Development accomplished? How many people in the Justice Department would have to be fired to end the corruption? You no longer need the Internal Revenue Service. You see where I am going with this.

The opposition to this plan would come from federal workers (fear of losing their jobs). Opposition would also come from Washington swamp creatures who would see it as a threat to their power (in Washington controlling money is power). It would also come from welfare recipients.

The other issue would be Social Security and its related taxes. That could be worked out easily by balancing payments to people who have paid into the program for more than forty years with alternatives for younger workers. With a retirement age of 70, most Americans pay the most into Social Security from about the age of 30.

This is all possible if Americans are willing to elect a businessman who has the economic knowledge to put it all together.

Imagine a world where you get to keep all of what you earn and the government cannot intimidate you about your taxes.

The Choice Is Between Bad And Awful

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On Wednesday, Armstrong Economics posted an article about inflation and recession.

The article reports:

Federal Reserve Bank of Minneapolis President Neel Kashkari has advised against anticipating near-term rate cuts. While speaking to the Financial Times, the Fed president stated that people would simply prefer a recession to continued inflation.

“I have learned that the American people—and maybe people in Europe equally—really hate high inflation. I mean, really viscerally hate high inflation,” he told the Financial Times’ The Economics Show podcast. Kashkari is speaking as if we are not already in a recession. It is not difficult to understand the “visceral” hatred people around the world feel toward rising prices. The effects of inflation are felt with every purchase, causing the average person to adjust their entire lifestyle.

The article concludes:

Real prices have far surpassed anything they calculate in CPI. Everyone understands that prices have risen far more than the arbitrary number the Fed provides us. Taxes are continually increasing for everyone in every tax bracket. The government not only adds to inflationary issues with their spending but then expects their citizens to foot a portion of the bill with taxes, which will simply never be enough.

Then we have Washington telling the masses to blame corporations for price gouging while raising their taxes and making it increasingly difficult to conduct business and maintain a large workforce. It is not that the people would prefer to be in a recession, the real issue is that countless people are entering survival mode. People everywhere want to hold onto whatever they may have out of fear for the future, but they are unable even to hoard as real prices now demand they hand over whatever they have to maintain their lives.

In a recession, consumer spending drops, and people lose their jobs. A service economy such as the one America currently has is more vulnerable to recession than a manufacturing economy. A recession creates hardship for working families.Inflation impacts both working families and retirees. Either one is a bad deal. The most practical way to deal with inflation in America would be to cut government spending and to resume domestic oil production. Both of those things would help revive a miserable economy.

The Root Causes Of The Current Inflation

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On Wednesday, Breitbart posted an article about the cause of the level of inflation Americans are currently dealing with.

The article quotes Neel Kashkari, who runs the Federal Reserve Bank of Minneapolis.

The article reports:

Surging immigration is keeping inflation and interest rates high, Fed honcho Neel Kashkari said in an interview with the Telegraph.

Kashkari, who runs the Federal Reserve Bank of Minneapolis, said he’s not ready to consider cutting rates until he sees “several months of real progress on inflation.” The flood of immigrants, he argued, is hindering that progress.

U.S. borrowing costs are likely to stay put for “an extended period of time,” Kashkari warned.

He’s particularly freaked out by the booming demand for housing, which just won’t cool off despite sky-high rates.

Kashkari’s immigration bombshell runs directly contrary to the claims by the Biden administration and its allies that surging immigration is keeping down inflation by depressing wages.

Kashkari said that “dramatic increase in immigration” is boosting housing demand. More people working from home and years of underbuilding aren’t helping either. It’s a perfect storm that’s keeping the housing market red-hot.

The article concludes:

He (Kashkari) also noted that services inflation had been “much stickier” in the past few months, making it even tougher to justify rate cuts.

“In the second half of last year, we saw very rapid disinflationary progress, and that was comforting for all of us because the economy was strong and inflation was falling quickly. I expected and hoped that that was going to continue in the first quarter of this year [but] inflation has more or less moved sideways,” Kashkari said.

Like other Fed officials, Kashkari said he needs solid proof that inflation is heading back to 2 percent before he’s comfortable with rate cuts.

“I want to see evidence that inflation is headed well back down towards the 2 percent target. I’m not saying that we have to get all the way back down to 2 percent before we start cutting, but I need to be convinced that that’s where we’re headed before I would be comfortable normalizing interest rates,” he said.

Rate cuts could result in people feeling better about the economy (a good thing in an election year), but they could also create even more inflation.

 

Does Anyone On The Political Left Go Grocery Shopping Or Buy Gasoline?

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On Thursday, BizPacReview posted an article about the mainstream media’s spin on America’s current economy. If it were not sad, it would be funny.

The article reports:

MSNBC host Stephanie Ruhle is telling Americans not to believe their lying eyes, that President Biden’s economy is fantastic and they are better off economically than they mistakenly believe.

The condescension and gaslighting have kicked into full gear as the presidential election nears. Despite Americans struggling to put food on the table, a roof over their heads, and clothes on their children’s backs, Ruhle is telling them they are basically dimwitted and don’t appreciate how good they have it.

“We need an economic explainer,” Ruhle told the president and CEO of the Federal Reserve Bank of Chicago, Austan Goolsbee. “People are confused, they’re exhausted, but they’re also doing quite well.”

“Ruhle, who hosts MSNBC’s ‘The Eleventh Hour,’ had been discussing a recent Federal Reserve report that ‘shows people are still struggling to cover day-to-day expenses, even as inflation has slowed.’ She noted how some major brands are responding by enticing consumers with slashed prices, ‘Target says it is cutting prices on 5,000 essential items, things like milk, butter, pet food. Wendy’s is now offering a $3 breakfast deal. And rivals like McDonald’s are offering new lower-priced value meals,’” Fox Business reported.

The article includes the following screenshot:

This is not the result of corporate greed as President Biden likes to claim–it is the result of companies trying to stay in business after their operating costs skyrocket. Anyone who eats and drives knows that we were much better off four years ago. The problem with inflation is that prices very rarely go back down to where they were.

April Inflation Statistics

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On Tuesday, CNN reported that according to Bureau of Labor Statistics data released Tuesday inflation in April was the highest it has been all year.

The article reports:

Wholesale inflation picked up in April to its highest rate in a year, according to Bureau of Labor Statistics data released Tuesday.

The Producer Price Index, which measures the change in prices that manufacturers pay to suppliers, was 2.2% for the 12 months ended in April, according to Bureau of Labor Statistics data released Tuesday.

That gain is higher than what was seen in March, which was downwardly revised from 2.1% to 1.8%.

On a monthly basis, prices rose 0.5%, a faster pace than March’s 0.1% loss (also downwardly revised) and ran much hotter than what economists had anticipated. Economists were expecting a monthly gain of 0.3%, according to FactSet consensus estimates.

“The concern here is that we now have a trend, an upward trend in producer prices, which can only be passed through to consumers and result in upward pressure on consumer price inflation over the coming months,” Kurt Rankin, senior economist for the PNC Financial Services Group, told CNN in an interview.

And that means interest rates will stay higher for longer and could further delay the Federal Reserve’s plans for cuts on that front, he said.

…While higher energy costs (up 2% in April) helped to push goods prices higher, services inflation is what drove up the overall PPI last month. Nearly three-quarters of the April monthly gain was attributable to price hikes seen by producers of services, according to the report.

Services providers saw a 0.6% increase in prices for the month, the fastest pace seen for that category since March 2022, Rankin noted.

“Services has been the issue over the past year as consumers continue to spend money, and costs for services-oriented businesses is still stronger than goods inflation; but goods producer prices are now also rising after having fallen through most of 2023,” he said.

This is bad news for consumers and also bad news for the Biden administration that wants to get re-elected in November. The promise of cutting the interest rate before the election to bring consumer costs down will not be kept if inflation continues on its current path.

Bidenomics At Work

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Aside from what you are paying for groceries and gasoline, have you looked at mortgage rates and home sales right now?

On Monday, One America News reported the following:

Sales of new U.S. single-family homes fell more than expected in October, likely as higher mortgage rates reduced affordability, but the housing segment remains supported by a persistent shortage of previously owned properties on the market.

New home sales dropped 5.6% to a seasonally adjusted annual rate of 679,000 units last month, the Commerce Department said on Monday. September’s sales pace was revised lower to 719,000 units from the previously reported 759,000 units.

Economists polled by Reuters had forecast new home sales, which account for a small share of U.S. home sales, would fall to a rate of 723,000 units.

New home sales are counted at the signing of a contract, making them a leading indicator of the housing market. They, however, can be volatile on a month-to-month basis. Sales increased 17.7% on a year-on-year basis in October.

The stock of previously owned houses on the market is nearly 50% below it’s pre-pandemic level, according to the National Association of Realtors, which last week reported that home resales plunged to more than a 13-year low in October. Most homeowners have mortgage rates under 3%, making many reluctant to sell, boosting demand for new construction.

According to The Mortgage Reports, the mortgage interest rate in 2021 was 2.96 percent. In 2022, it was 5.34 percent. The current mortgage rate, according to Nerd Wallet is about 7.5 percent. That is a significant increase. Interest rates were artificially kept low for a number of years. That was not sustainable. However, the rate of increase (the Federal Reserve’s attempt to curb inflation) has hurt real estate sales. At one point many years ago because of a job change, we were forced to take out a mortgage at 8.5 percent (giving up a mortgage of 4 percent). If you are sitting on a 3 or 4 percent mortgage right now, the last thing you want to do is move and take out a 7.5 percent mortgage. Bidenomics has hurt Americans across the board. We need a new President with a new approach to the economy.

It’s Past Time For This!

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On Tuesday, The Epoch Times posted the following headline:

The Time to Audit the Fed Is Here

A site called worldtraining.net explains some of the history of the Federal Reserve:

On June 4, 1963, a little known attempt was made to strip the Federal Reserve Bank of its power to loan money to the government at interest. On that day President John F. Kennedy signed Executive Order No. 11110 that returned to the U.S. government the power to issue currency, without going through the Federal Reserve. Mr. Kennedy’s order gave the Treasury the power “to issue silver certificates against any silver bullion, silver, or standard silver dollars in the Treasury.” This meant that for every ounce of silver in the U.S. Treasury’s vault, the government could introduce new money into circulation. In all, Kennedy brought nearly $4.3 billion in U.S. notes into circulation. The ramifications of this bill are enormous.

        With the stroke of a pen, Mr. Kennedy was on his way to putting the Federal Reserve Bank of New York out of business. If enough of these silver certificates were to come into circulation they would have eliminated the demand for Federal Reserve notes. This is because the silver certificates are backed by silver and the Federal Reserve notes are not backed by anything. Executive Order 11110 could have prevented the national debt from reaching its current level, because it would have given the government the ability to repay its debt without going to the Federal Reserve and being charged interest in order to create the new money. Executive Order 11110 gave the U.S. the ability to create its own money backed by silver.

        After Mr. Kennedy was assassinated just five months later, no more silver certificates were issued. The Final Call has learned that the Executive Order was never repealed by any U.S. President through an Executive Order and is still valid. Why then has no president utilized it? Virtually all of the nearly $6 trillion in debt has been created since 1963, and if a U.S. president had utilized Executive Order 11110 the debt would be nowhere near the current level. 

The Federal Reserve creates money out of thin air and then loans it to the government at interest. It’s a great scheme.

The Epoch Times reports:

This week, Sen. Rand Paul is pushing an amendment to a major spending bill that would finally do what should have been done decades ago. It should have been an annual undertaking for the past 100 years. He wants a thorough and external audit of the Fed, using prevailing accounting standards to figure out where the billions and trillions are coming from and where they’re going.

Please follow the link to read the entire article. This needs to be done.

Moving To Protect Americans’ Money

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On Wednesday, The Washington Examiner reported:

House Republicans have advanced a bill that would stop the Federal Reserve from issuing digital currency, sending the legislation to the House for a vote.

The House Financial Services Committee voted Wednesday to advance the legislation, which was sponsored by Rep. Tom Emmer (R-MN). The bill is dubbed the Central Bank Digital Currency Anti-Surveillance State Act. It won support from Republicans and drew opposition from some Democrats on the committee.

If you want the government to have full control over how much money you have and how you spend it, Central Bank Digital Currency is for you. It is one of the worst ideas to come along in a long time.

The article notes:

“The CBDC Anti-Surveillance State Act underscores that fact and protects Americans’ privacy and our financial system from the risks a CBDC would pose,” said committee Chairman Patrick McHenry (R-NC). “It builds on the principles that Republicans developed last Congress to guide our evaluation of a potential CBDC.

“The bill, led by Whip Emmer, emphasizes those principles and ensures that the Federal Reserve cannot issue a CBDC without congressional approval,” he added.

Democrats, though, blasted the legislation as being antithetical to innovation and competition.

“Unfortunately, this bill, which I will call the CBDC anti-innovation act … would commonly shut down important work the Fed is doing to research a potential U.S. CBDC,” said the committee’s Ranking Member Maxine Waters (D-CA). “Instead of taking steps to ensure the United States wins the digital currency space race against emerging powers like China, Republicans are making baseless attacks against the CBDC that does not even exist.”

Remember, the Democrats are the people who want to control the car you drive and the stove you cook on. They are the last people I want to control my income and my spending.

Dangers of Digital Currency

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Author: R. Alan Harrop, Ph.D

Given the harsh reality that today’s Democrat Party follows Marxist principles which will destroy this country as we have known it, the best starting point is to oppose any new initiative coming from the Biden regime. Their newest, and arguably, the most destructive of their many destructive policies is that of a digital currency. They are currently “testing the waters” so to speak and we must not allow them to implement this
idea. There are many reasons to oppose a digital dollar; here are a few of them.

According to the Biden regime, a digital form of currency (Central Bank Digital Currency, CBDC) would be issued and controlled by the Federal Reserve and replace paper money in most if not all transactions. To a great number of people, myself included, who rely very heavily on their credit cards for most financial transactions this may seem to be a logical step. But it is much more. First, a digital currency would be totally
controlled by the Federal Reserve which is an agency frought with many problems since its inception in 1913, but most importantly the people do not control or select its members. We cannot vote them out of office if we so desired, consequently we lose control over our money system. Very bad idea. Second, digital currency
is not backed by any tangible asset that has inherent value such as gold, silver, oil, etc. Third, and this is critical, the government would not only be able to track all your expenditures but would be able to stop or limit you from purchasing items they do not think you should have. Like gasoline powered cars, meat, gas stoves, guns, ammunition to name just a few.. Why in the name of all that is holy, would any sane person want to give the government total control over your finances? Without the ability to spend what you want on whatever you want, you have lost your freedom. Period. No wonder Marxist governments like China are moving towards digital currency. Fourth, the money you have accumulated can be lost if the system is either hacked or is compromised by an attack on the electrical grid. We all know how totally preventing this type of hacking is already not possible. Fifth, say you wanted to go to a local bank (most of which will be eliminated) and withdraw some cash. Sorry, you will no longer be able to do so.

You must stay abreast of what is going on with digital currency and let your elected officials know that you are opposed and want it stopped. Like all destructive Marxist social programs (e.g. Medicaid) the Democrats will try to sell this idea with phony advantages. Do not be fooled. This is one of the most, if not the most destructive Marxist ideas and the Republican controlled U.S. House of Representatives must block
digital currency, if our country is to survive