Whoa! Inflation has hit a new forty-year high of 8.5%. I imagine you feel quite annoyed when you fill up your gas tank, buy groceries, or buy a car. Since last year, gasoline prices have surged 48%, meat prices have risen 14% and prices for used cars increased by 35%.
Don’t believe what you hear from Joe Biden and his acolytes in Washington, D.C. this month.
Inflation was not purely caused by Putin and his invasion of Ukraine. No, inflation started immediately after Joe Biden took office. At less than 2% when he was sworn in as president, inflation surged to more than 4% only three months later and never looked back. That’s what happens when you throw $2 Trillion at the economy from a completely partisan COVID package and fail to understand the Federal Reserve was already stoking the coals of a strong economic recovery.
For inflation to come down, Biden and Congressional Democrats should freeze federal spending, except for defense. The Federal Reserve must also quickly raise interest rates and shrink the supply of money. If they don’t act judiciously and in unison, I fear only a major recession will tame this new inflation beast.