Biden’s Peggy Lee Economy: Is That All There Is? GDP QoQ Prints At Anemic 1.3%, Core Inflation Prints Hotter At 5.0% QoQ Despite Trillions In Federal Spending

Peggy Lee sang it best about the US economy under Biden: Is that all there is?

According to the Bureau of Economic Analysis (BEA), US GDP QoQ rose slightly to an anemic 1.3%. Actually, this is a terrible print given the trillions in Federal spending after Covid.

Even worse, Core Inflation (PCE core prices) rose to 5%. So, unlike what Treasury Secretary Janet “Transitory” Yellen said, core inflation remains high despite M2 Money growth crashing.

Here is the rest of the story.

Before conservatives have a meltdown over the comments that will be forthcoming from Biden’s Press Secretary Karine Jean=Pierre, bear in mind that she was senior advisor and national spokesman for hard-left progressive advocacy group MoveOn.org.

She will feel obligated to howl and scream about the debt ceiling and budget with idiocy like “the economy will crash and burn if you cut Biden’s proposed budget.” Gee, for the trillions that Biden has spent, we only got 1.3% GDP growth. So her logic will be “President Biden spent trillions and we got only 1.3% GDP growth! Imagine if we spend less????”

Biden Won’t Default, US Dollar Sinking, Gold Up As Fed Shrinks M2 Money, Cryptos Down (Yellen Running Out Of Money To Spend)

I have gotten a flood of emails and text messages asking about what happens if Biden defaults on the US debt. In short, Biden has made a career out of spending money, as has Speaker McCarthy. They both have an incentive to raise the debt ceiling, but whether it is cuts to Biden’s insane budget (higher than Covid-era spending) and wants to raise taxes on the middle class to pay for it. McCarthy wants a trimmed budget (aka, back to pre-Covid spending levels) and NOT raises taxes. They will eventually agree somewhere in the middle (US Congress member Pramila Jayapal will be outraged, but then again, she is ALWAYS outraged like Senator Elizabeth Warren) and AOC.

The Federal Reserve has taken a brief respite from fighting inflation that they helped cause. But with $188 TRILLION in unfunded entitlements promised by politicians, The Fed will undoubtedly start buying assets again (aka, QEInfinity) and the debt ceiling will keep being raised. In essence, the DC merry-go-round is broken and politicians will keep pushing it around until it collapses.

For the moment, The Federal Reserve is reducing M2 Money (green line). With it, the US Dollar (blue line) has declined. Gold (white line fever) is on the rise along with The Fed’s effective funds rate.

WTI crude is up over 1% this AM. And gold is up 2.29%. Heating oil is up 3.56%.

Face it, I have no confidence in Treasury Secretary Janet Yellen, one of the biggest propronents of MMT (modern monetary theory or borrow and spend without consequences). Yellen is NOT making lose my blues.

Cryptos are down this morning across the board.

Like Persistent Inflation, New Home Sales Rise 4.1% MoM In April Despite M2 Money Collapse (Taylor Rule Suggests Target Rate Of 11.78%, So The Fed Is STILL Overstimulating Markets)

Remember when former Fed Chair and current Treasury Secretary Janet Yellen said that inflation was transitory? As usual, Yellen was wrong. Look at April’s new home sales. Up 4.1% since March even through M2 Money growth has collapsed.

The Taylor Rule, based on Core CPI of 5.25% (persistent, not transitory inflation Janet) suggest a Fed target rate of 11.78%. The Fed is at 5.25% and likely to pause rate hikes and maybe even lower rates again.

Babbling Biden! The US Budget Deficit Remains Higher Than Before Covid (Biden Lying … Again) Lagarde Trusts in US Common Sense to Avert Catastrophic Default

Joe Biden is the worst public speaker of any President in history. Here is “Babbling Biden” lying about the great reduction in Federal budget deficit.

First, Biden didn’t “balance the budget” liked he claimed at Hiroshima. In fact, the Federal budget deficit, while improving, is still worse than it was before the 2020 Covid economic shutdown.

Biden, Schumer and Yellen are ignoring the $187 TRILLION in UNFUNDED entitlements promised America, even though Biden keeps threatening to halt Social Security payments if Biden and Yellen default on the debt. No discussion of the runaway train of entitlemennts.

I love this Bloomberg headline: “(ECB’s) Lagarde Trusts in US Common Sense to Avert Catastrophic Default.” Has Lagarde actually talked to Biden, Harris or Yellen? America’s REAL 3 Stooges??

Here is a video of Joe Biden tackling the debt ceiling.

US Treasury Cash Balance Down To $68 Billion As Fed Crashes M2 Money Growth (Clock Is Ticking With One Day Of Spending Left!)

Yes, the clock is ticking on a possible debt default and Biden is off in Hiroshima Japan instead of negotiating with House Speaker McCarthy.

The treasury cash balance is only $18 billion away from Yellen’s minimum balance redline of $50 billion. That’s one day of spending in crazy spending Washington DC.

Jobs Friday! US Avg Hourly Earnings In April Increase To 4.4% YoY, Too Bad Core Inflation Is At 5.6% YoY (Jobs Revision Loses -149K Jobs)

The good news? The US economy added 253k jobs in April. The bad news? Last months jobs report of 236k jobs added was revised downwards to 165k jobs added.

US average hourly earnings year-over-year (YoY) rose in April to 4.4%. Too bad core inflation at the last reading also rose to 5.6% YoY.

Yes, Biden and his talking heads will talk about the 253k jobs added, but will ignore (of course) the huge downward revision of March’s jobs added. 236k revised downwards to a mere 165k.

And on the good jobs report, the 10-year Treasury yield jumped by 10.9 basis points.

And the US Treasury 2Y-3M curve has dropped off the end of the earth.

The Core! US March Core PCE Prices Remain HOT At 4.6% YoY Despite Fed Crashing M2 Money Growth, March Personal Spending Slows To 0% MoM (Taylor Rule Suggests 10.27% Target Rate)

March’s Personal Consumption Expenditures Core Prices remain HOT despite The Fed crashing M2 Money growth. PCE Core price growth remained elevated at 4.6%.

Personal spending in March slowed to 0% growth.

The Taylor Rule infers a Fed Funds target rate of 10.27% Alas, we will never get there.

Out Of Gas? US PPI Final Demand PRICES Crash To 2.7% YoY As Fed Withdraws Monetary Stimulus

Is the US economy out of gas? Or are we under The Fed’s massive thumb?

US Producer Price Index (PPI) final demand YoY fell to 2.7% in March as The Fed withdraws its massive monetary stimulus.

Final demand MoM fell -0.5% in March. But the interest number is CORE PPI ex food and energy actually down but at 3.6%. So, CORE PPI final demand growth is higher than the aggregate.

Do I detect a trend in US continuing jobless claims?

At least Biden is in Belfast Ireland making his usual gaffes, telling outrageous lies and looking totally lost. As usual. He can do less damage to the US by being in Ireland.

Gimme Shelter! Fed Leans Toward Another Hike, Defying Staff’s Recession Outlook (Shelter CPI UP 8.2% YoY, Food CPI UP 8.5% YoY)

Gimme (cheap) shelter.

Two of the biggest items for consumer are housing and food. Shelter inflation (CPI) is still growing at 8.2% YoY and food is still growing at 8.5% YoY.

Federal Reserve officials appear on track to extend their run of interest-rate hikes when they meet next month, shrugging off their advisers’ warning of recession with a bet that they need to do a little more to curb inflation.

Minutes of last month’s policy meeting showed officials dialed back expectations of how high they’ll need to lift rates after a series of bank collapses roiled markets last month. Still, officials raised their benchmark lending rate a quarter point to a range of 4.75% to 5%, as they sought to balance the risk of a credit crunch with incoming data showing price pressures remained too high.

They did so even after hearing from Fed staff advisers that they were forecasting a “mild recession” later this year.

Officials agreed “some additional policy firming may be appropriate,” according to minutes of the Federal Open Market Committee gathering, a posture several Fed speakers have reiterated in recent days.

Policymakers “commented that recent developments in the banking sector were likely to result in tighter credit conditions for households and businesses and to weigh on economic activity, hiring and inflation,” the minutes said, though they agreed the extent of the effects was uncertain. “Against this background, participants continued to be highly attentive to inflation risks.”

Sympathy for the Biden Administration and Federal Reserve? They caused this unholy disaster.

US Core Inflation Rises To 5.6% In March Keeping Rate Hikes On Table, Shelter CPI UP 8.2% YoY, Food UP 8.5% YoY (Taylor Rule Suggests 11.77% Fed Funds Rate)

US Core inflation keeps rising despite The Federal Reserve slowing M2 Money growth and raising The Fed Funds Targget rate as The Fed plays catch up from Janet Yellen’s “Too Low For Too Long” monetary policies under Obama. And she was … negligent.

US Core Inflation (Core CPI YoY) rose to 5.6% in March despite The Fed cranking up their target rate and rapidly withdrawing M2 Money.

Here is the CPI report for March. At least energy prices are down, but shelter is up 8.2% YoY and food is up 8.5% YoY.

How about REAL wages? Real average weekly earnings growth has now been negative for 24 straight months.

One reason that core inflation is still rising is that The Fed still has not raised rates sufficiently. According to the Taylor Rule, the Fed Funds Target rate should be 11.77% based on core inflation of 5.6%. Hey, The Fed isn’t even half way there. It is like the Doolittle Raiders in World War II dropping their bombs 100 miles off the Japanese coast well short of their target.

Fed Funds Futures are pricing in one more rate hike (and a small one at that) before they resume cutting rates again.

Is The Fed chicken?