REUTERS
"Soaring insurance costs hit as US buyers get a break on car prices"
By Timothy Aeppel
April 11, 2024
April 11 (Reuters) - A new form of sticker shock has hit American car buyers like Darin Davis.
In January, when the 56-year-old Dallas real estate agent renewed the insurance on the pearly-white 2024 Cadillac XT4 that he bought just a few months earlier, the rate nearly doubled.
"It takes the fun out of owning a new car when you’re paying so much money," said Davis, adding that if he’d known such a massive increase was coming, he might have opted for a less expensive model.
But by then it was too late.
In one of the cruel twists of an inflation-weary U.S. economy, car prices are coming down after surging by record amounts during the COVID-19 pandemic.
But at least part of those gains for consumers are getting gobbled up by rising auto insurance rates that for some models now account for more than a quarter of the total cost of owning a vehicle.
Car prices have eased as the supply chain snarls of the pandemic -- especially shortages of vital computer chips -- have untangled and automakers boost inventories on their lots.
Meanwhile, factors including rising costs associated with repairing increasingly complicated vehicles and more storm damage amid climate change is pushing insurance rates higher.
And car buyers aren't the only ones with an axe to grind over insurance inflation.
For Federal Reserve policymakers working to lower inflation overall, it's an example of the unwelcome surprises that have conspired to slow their progress.
HURTING AFFORDABILITY
The Consumer Price Index rose 3.5% last month from a year earlier, according to the Labor Department.
But auto insurance costs were up 22.2% over the same period, the biggest increase since the 1970s.
Car prices, meanwhile, continued to moderate.
New vehicle prices declined 0.1%, compared to a year earlier, while used prices slipped 2.2%.
Car dealers are offering more incentives to buyers, which helps bring down up-front costs.
The degree to which insurance rates are weighing on buying decisions is unclear, but there are signs it’s become a bigger factor, especially for consumers on tight budgets.
"We’re hearing from a number of shoppers that they’re declining to buy a car - or returning one - because they can afford the car, but not the insurance for it," said Sean Tucker, a senior editor at Kelley Blue Book, a car valuation and research company in Irvine, California.
Tucker said Kelley Blue Book recently added insurance guidance to its list of buying tips, urging shoppers to get an insurance quote before they put down any money.
Car insurance rates vary widely across the country and are influenced by everything from the cost local collision repair shops charge to the potential for damage from tropical storms and wildfires.
According to the insurance shopping site Insurify, the average cost in the U.S. for full auto coverage rose 24% last year and now stands at just over $182 a month.
The company said 63% of drivers it surveyed saw rates increase in 2023 and predicts rates will rise another 7% in 2024.
But that figure could rise.
"We’re seeing a lot of activity in (the first quarter) that indicate to us it may increase even more," said Jessica Edmondson, a data specialist at Insurify.
TOTAL COST
Insurance seems poised to continue to grow as a share of the so-called total cost of owning of a vehicle, which factors in things like routine maintenance, taxes, depreciation, and fuel, as well as insurance.
According to Kelley Blue Book, insurance accounted for an average 16% of this gauge for a compact car in 2019 and will grow to 26% in 2024.
For a compact SUV, it was 13% in 2019, but will be 20% this year.
Multiple forces have combined to fuel the current surge in rates.
More cars are being totaled than in the past and quality issues mounted during the production disruptions caused by the pandemic that can lead to insurance claims.
A shortage of mechanics has meant it takes longer to fix a car, which in turn drives up the cost to insurance companies that provide rental cars to policyholders waiting for those repairs.
A typical car is also increasingly laden with electronics that can make them costlier and more difficult to repair.
"A bumper is just a bumper - but a bumper full of sensors costs more to repair," said Kristin Dziczek, a policy advisor at the Federal Reserve Bank of Chicago who is an expert in automotive industry trends.
She noted that electric cars, on average, cost 30% more and can take longer to repair.
There are also changes in how carmakers are producing cars that carry insurance implications.
For instance, Tesla has pioneered a process called gigacasting, which involves casting a single part that can replace 30 or more separate pieces of metal in a traditional vehicle.
That reduces production costs but can make it costlier to repair a vehicle involved in an accident.
Other carmakers are following suit.
Cadillac makes one model now that uses 16 gigacastings.
Meanwhile, Davis -- the Dallas real estate agent who bought a new Cadillac -- said he eventually found a cheaper option by bundling his car and homeowners insurance and increasing the deductible.
https://www.reuters.com/markets/us/soar ... 024-04-11/
POLITICS
Re: POLITICS
REUTERS
"Fed's Collins sees no urgency to cut rates"
By Michael S. Derby
April 11, 2024
NEW YORK, April 11 (Reuters) - Federal Reserve Bank of Boston President Susan Collins said Thursday the strength of the economy and uneven retreat of inflation argues against a near term push to lower rates by the central bank.
“I do expect it will be appropriate to begin lowering the federal funds rate later this year,” Collins said in the text of a speech prepared for delivery before a gathering of the Economic Club of New York.
That said, “recent data suggest it may take more time than I had previously thought to gain greater confidence in inflation’s downward trajectory, before beginning to ease policy,” the official said.
What does it mean?
Collins weighed in as markets have been digesting stronger-than-expected inflation data over the start of the year.
Coupled with ongoing robust job gains, traders and investors have been marking down the prospects of Fed rate cuts and pushing back the start date of the easing, even as Fed officials say they think they’re still on track for some sort of lowering of what is now a 5.25% to 5.5% federal funds rate.
In her remarks, Collins said monetary policy is in a good position right now and there’s increasing evidence that despite the high level of the short-term rate target policy may not be providing as much restraint as expected.
“It may just take more time than previously thought for activity to moderate, and to see further progress in inflation returning durably to our target,” Collins said.
“Less concern about labor market fragilities, combined with the possibility that policy is only modestly restrictive, also reduces the urgency to ease,” she said.
Collins said that while it’s not a surprise that inflation’s retreat toward 2% hasn’t been as robust over recent months as it was last year, “disinflation may continue to be uneven.”
For the Fed, “this also implies that less easing of policy this year than previously thought may be warranted.”
While risks for the outlook abound, Collins said she was cautiously optimistic about the outlook.
“I expect to see further evidence that inflation is durably, if unevenly, returning toward 2 percent, and that the economy is coming into better balance, with demand and supply more closely aligned amid a healthy labor market,” the official said.
Reporting by Michael S. Derby; Editing by Chizu Nomiyama
https://www.reuters.com/markets/rates-b ... 024-04-11/
"Fed's Collins sees no urgency to cut rates"
By Michael S. Derby
April 11, 2024
NEW YORK, April 11 (Reuters) - Federal Reserve Bank of Boston President Susan Collins said Thursday the strength of the economy and uneven retreat of inflation argues against a near term push to lower rates by the central bank.
“I do expect it will be appropriate to begin lowering the federal funds rate later this year,” Collins said in the text of a speech prepared for delivery before a gathering of the Economic Club of New York.
That said, “recent data suggest it may take more time than I had previously thought to gain greater confidence in inflation’s downward trajectory, before beginning to ease policy,” the official said.
What does it mean?
Collins weighed in as markets have been digesting stronger-than-expected inflation data over the start of the year.
Coupled with ongoing robust job gains, traders and investors have been marking down the prospects of Fed rate cuts and pushing back the start date of the easing, even as Fed officials say they think they’re still on track for some sort of lowering of what is now a 5.25% to 5.5% federal funds rate.
In her remarks, Collins said monetary policy is in a good position right now and there’s increasing evidence that despite the high level of the short-term rate target policy may not be providing as much restraint as expected.
“It may just take more time than previously thought for activity to moderate, and to see further progress in inflation returning durably to our target,” Collins said.
“Less concern about labor market fragilities, combined with the possibility that policy is only modestly restrictive, also reduces the urgency to ease,” she said.
Collins said that while it’s not a surprise that inflation’s retreat toward 2% hasn’t been as robust over recent months as it was last year, “disinflation may continue to be uneven.”
For the Fed, “this also implies that less easing of policy this year than previously thought may be warranted.”
While risks for the outlook abound, Collins said she was cautiously optimistic about the outlook.
“I expect to see further evidence that inflation is durably, if unevenly, returning toward 2 percent, and that the economy is coming into better balance, with demand and supply more closely aligned amid a healthy labor market,” the official said.
Reporting by Michael S. Derby; Editing by Chizu Nomiyama
https://www.reuters.com/markets/rates-b ... 024-04-11/
Re: POLITICS
THE CAPE CHARLES MIRROR APRIL 11, 2024 AT 8:44 PM
Paul Plante says:
Cause and effect, people!
Yes, they still exist.
Something that happened yesterday is inextricably linked to something that will happen tomarrow, such as the policies of the Roaring Twenties resulted in the GREAT DEPRESSION, or BIDE-O-NOMICS yesterday has resulted in sticky BIDENFLATION today, but, if people are confused, or scared, or have short memories, or are distracted, or busy doing something else, all of which politicians since time immemorial have counted on as they gull and swindle and hornswoggle the populace for their benefit and that of their cronies, they fail to connect the dots, which of course is the hope and goal of the politicians feeding off the taxpayers, because in America, at least, feeding off the taxpayers is not a crime, and hey, it is what they are there for in the first place, to serve as a food source for the politicians to feed off of, which takes us for the moment back in time to back to the Baltimore Evening Sun on October 6, 1924 and political essay “The Coolidge Buncombe” by H.L. Mencken, where we have a basis of comparison of the character of Joe Biden with that of both Warren Gamaliel Harding, who before Joe Biden took the crown from him, was deemed the worst American president, and Calvin Coolidge, or “Silent Cal,” as he was known, to wit:
What I contend is that the Coolidge Administration, if it is inflicted on us, is bound to be quite as bad as the Harding Administration, and that the chances are that it will be a great deal worse.
In other words, I contend that it is bound to manufacture radicalism in a wholesale manner, and that this radicalism will be far more dangerous to legitimate business than the mild stuff that Dr. La Follette now has on tap.
I believe that the Coolidge Administration will be worse than that of Harding for the plain reason that Coolidge himself is worse than Harding.
Harding was an ignoramus, but there were unquestionably good impulses in him.
end quotes
Why don’t we have people in the main-stream and legacy media today who have the guts and courage to label Joe Biden an ignoramus?
Because they think he is a brilliant genius statesman, instead?
Going back to Mencken on Harding, who as bad as he was, was actually a far better president than is Joe Biden, we have more, as follows, as we ponder the question of just how is it that we end up with these kinds of people as our “leaders,” which makes the term American president into a mockable term, to wit:
He (Harding) had a great desire to be liked and respected; he was susceptible to good as well as to bad suggestions; his very vanity, in the long run, might have saved him from the rogues who exploited him.
Behind Harding the politician there was always Harding the businessman — a man of successful and honorable career, jealous of his good name.
Coolidge is simply a professional politician, and a very petty, sordid and dull one.
end quotes
ENTER JOSEPH ROBINETTE BIDEN, JUNIOR!
He (Coolidge) has lived by job-seeking and job-holding all his life; his every thought is that of his miserable trade.
end quotes
That description, people, also fits Joe Biden to a tee, which takes us back for more, to wit:
When it comes to a conflict between politicians and reputable folk, his instinctive sympathy always goes to the politicians.
He showed this sympathy plainly in the Denby and Daugherty cases.
end quotes
“Denby,” of course, is Edwin Denby (February 18, 1870 – February 8, 1929), who was an American lawyer and politician who served as Secretary of the Navy in the administrations of Warren G. Harding and Calvin Coolidge from 1921 to 1924, and he is famous for playing a notable role in the infamous Teapot Dome scandal which took place during the Harding presidency, where Denby got Harding’s approval to transfer control of the naval oil reserves at Teapot Dome, Wyoming, and Elk Hills, California, from the Department of the Navy to the Department of the Interior, headed by Albert B. Fall, who then proceeded to lease these oil fields to friends who were heads of oil companies in exchange for over $400,000 in personal loans.
Despite attempts to keep the deal secret, The Wall Street Journal leaked news of the leasing, and the Senate decided to launch an inquiry into the matter, which investigation began in October 1923 after Harding’s death, and the Senate Committee on Lands and Public Surveys, which carried out the inquiry, concluded in 1924 that the Teapot Dome and Elk Hills leases to the oil companies had been fraudulent and corrupt, so that both Denby and Fall were forced to resign from office as a result.
“Daugherty” was Harry Micajah Daugherty (January 26, 1860 – October 12, 1941) and he was an American politician best remembered for his service as Attorney General of the United States under presidents Warren G. Harding and Calvin Coolidge, as well as for his involvement in the Teapot Dome scandal during Harding’s presidency.
Daugherty remained an influential figure behind the election of several U.S. representatives and senators and he was Harding’s campaign manager at the 1920 Republican National Convention.
Following Harding’s successful election, Daugherty was named attorney general.
Twice the subject of federal corruption investigations, Daugherty was forced in 1924 to resign his post as attorney general by Coolidge.
Which takes us back to Mencken and 1924, to wit:
To say that he (Coolidge) was not strongly in favor of both men is to utter nonsense.
He not only kept them in office as long as he could, despite the massive proofs of their unfitness; he also worked for them behind the door, stealthily and ignominiously.
To this day he has not said a single word against either of them; all his objurgations have been leveled at those who exposed them and drove them out.
He kept the asinine Teddy Roosevelt, Jr., in office until a week or so ago, and then gave him a parting salute of twenty-one guns.
He is even now trying to promote Captain Robison, the man who arranged the Doheny oil grab.
end quotes
“Doheny” is Edward Laurence Doheny (August 10, 1856 – September 8, 1935) who was an American oil tycoon who, in 1892, drilled the first successful oil well in the Los Angeles City Oil Field.
In the 1920s, Doheny was implicated in the Teapot Dome scandal and accused of offering a $100,000 bribe to United States Secretary of the Interior Albert Fall.
Doheny was twice acquitted of offering the bribe, but Fall was convicted of accepting it.
In 1922 Albert B. Fall, U.S. Secretary of the Interior, leased the oil field at Elk Hills, California, to the Pan American Petroleum & Transport Company, and around the same time, the Teapot Dome Field in Wyoming was leased to Sinclair Consolidated Oil Corporation.
Both oilfields were part of the US Navy’s petroleum reserves and neither lease was subject to competitive bidding.
In 1924 rumors about corruption in the deals escalated into the Teapot Dome scandal, and Doheny’s reputation was somewhat tainted by a bribe paid to the Secretary of the Interior, Albert B. Fall in 1921.
He (Doheny) made the “gift” of $100,000 in connection with obtaining a lease of 32,000 acres (13,000 ha) of government-owned land used for the Elk Hills Naval Petroleum Reserve near Taft, California, and the resulting scandal broke soon after that, over similar bribes Fall accepted for leasing Teapot Dome in Wyoming.
Doheny was charged with bribing Fall but, in 1930, was acquitted.
His son, Ned, who had delivered the money, and assistant Hugh Plunkett were also charged, but died before they could be tried.
Nevertheless, Fall was convicted of accepting the bribe.
end quotes
Which again takes us back to Mencken on Coolidge, to wit:
Who has forgotten that he wanted to appoint Daugherty to “investigate” that colossal steal?
Or that he was in close and constant communication with Ned McLean, Dougherty’s and Fall’s friend, during the whole of the inquiry?
No amount of campaign blather will suffice to wipe out this discreditable record.
Coolidge pulled against the oil investigation from the start; he pulled against the Dougherty investigation from the start; he let Daugherty and Denby go at last only under pressure, and after trying to hit their opponents below the belt.
His sympathy has been with such oppressed patriots all his life, and it is with them today.
If he is elected for four years every professional politician in the Republican party will rejoice, and with sound reason.
There will be good times for the boys — and Fall, Daugherty and company will be safe.
But will the country be safe?
It is not so certain.
Those businessmen who think only of easy profits tomorrow might do well to give a thought or two to the day after.
They have seen a very formidable radical movement roll up under their noses.
If they have any sense, they will not be deceived by the argument that it has been set in motion by “agitators.”
What agitators?
Who and where are they?
I can find no such persons.
La Follette stumped the country for years and got nowhere.
Only his own State heeded him.
But last winter he began to get a response, and soon it was immense and vociferous.
That response came from men and women who had become convinced at last, and with good logic, that government by professional politicians was intolerably and hopelessly rotten — that the only remedy was to turn them out, and then make laws to prevent them coming back.
Personally I doubt that such laws, if made, will work.
In other words, I am not a radical.
I believe that all government is evil, and that trying to improve it is largely a waste of time.
But that is certainly not the common American view; the majority of Americans are far more hopeful.
When they see an evil they try to remedy it — by peaceful means if possible, and if not, then by force.
In the present case millions of them tire of the degrading Coolidge farce, with its puerile evasion of issues, its cloaking of Denby and Daugherty, its exaltation of such political jugglers as Slemp and Butler, its snide conspiracy to rob La Follette of honest votes in California.
They tire of it and want to end it.
What now, if they are forced to stand four years more if it?
What if they must see it grow ever worse and worse?
To timorous businessmen, in this year 1924, La Follette may look dangerous.
But let them ask themselves what sort of radicalism will probably be afoot in 1928, after four more years of Coolidge.
end quotes
And let us ask ourselves what sort of radicalism will probably be afoot in 2028, after four more years of Joe Biden?
http://www.capecharlesmirror.com/paul-p ... ent-917018
Paul Plante says:
Cause and effect, people!
Yes, they still exist.
Something that happened yesterday is inextricably linked to something that will happen tomarrow, such as the policies of the Roaring Twenties resulted in the GREAT DEPRESSION, or BIDE-O-NOMICS yesterday has resulted in sticky BIDENFLATION today, but, if people are confused, or scared, or have short memories, or are distracted, or busy doing something else, all of which politicians since time immemorial have counted on as they gull and swindle and hornswoggle the populace for their benefit and that of their cronies, they fail to connect the dots, which of course is the hope and goal of the politicians feeding off the taxpayers, because in America, at least, feeding off the taxpayers is not a crime, and hey, it is what they are there for in the first place, to serve as a food source for the politicians to feed off of, which takes us for the moment back in time to back to the Baltimore Evening Sun on October 6, 1924 and political essay “The Coolidge Buncombe” by H.L. Mencken, where we have a basis of comparison of the character of Joe Biden with that of both Warren Gamaliel Harding, who before Joe Biden took the crown from him, was deemed the worst American president, and Calvin Coolidge, or “Silent Cal,” as he was known, to wit:
What I contend is that the Coolidge Administration, if it is inflicted on us, is bound to be quite as bad as the Harding Administration, and that the chances are that it will be a great deal worse.
In other words, I contend that it is bound to manufacture radicalism in a wholesale manner, and that this radicalism will be far more dangerous to legitimate business than the mild stuff that Dr. La Follette now has on tap.
I believe that the Coolidge Administration will be worse than that of Harding for the plain reason that Coolidge himself is worse than Harding.
Harding was an ignoramus, but there were unquestionably good impulses in him.
end quotes
Why don’t we have people in the main-stream and legacy media today who have the guts and courage to label Joe Biden an ignoramus?
Because they think he is a brilliant genius statesman, instead?
Going back to Mencken on Harding, who as bad as he was, was actually a far better president than is Joe Biden, we have more, as follows, as we ponder the question of just how is it that we end up with these kinds of people as our “leaders,” which makes the term American president into a mockable term, to wit:
He (Harding) had a great desire to be liked and respected; he was susceptible to good as well as to bad suggestions; his very vanity, in the long run, might have saved him from the rogues who exploited him.
Behind Harding the politician there was always Harding the businessman — a man of successful and honorable career, jealous of his good name.
Coolidge is simply a professional politician, and a very petty, sordid and dull one.
end quotes
ENTER JOSEPH ROBINETTE BIDEN, JUNIOR!
He (Coolidge) has lived by job-seeking and job-holding all his life; his every thought is that of his miserable trade.
end quotes
That description, people, also fits Joe Biden to a tee, which takes us back for more, to wit:
When it comes to a conflict between politicians and reputable folk, his instinctive sympathy always goes to the politicians.
He showed this sympathy plainly in the Denby and Daugherty cases.
end quotes
“Denby,” of course, is Edwin Denby (February 18, 1870 – February 8, 1929), who was an American lawyer and politician who served as Secretary of the Navy in the administrations of Warren G. Harding and Calvin Coolidge from 1921 to 1924, and he is famous for playing a notable role in the infamous Teapot Dome scandal which took place during the Harding presidency, where Denby got Harding’s approval to transfer control of the naval oil reserves at Teapot Dome, Wyoming, and Elk Hills, California, from the Department of the Navy to the Department of the Interior, headed by Albert B. Fall, who then proceeded to lease these oil fields to friends who were heads of oil companies in exchange for over $400,000 in personal loans.
Despite attempts to keep the deal secret, The Wall Street Journal leaked news of the leasing, and the Senate decided to launch an inquiry into the matter, which investigation began in October 1923 after Harding’s death, and the Senate Committee on Lands and Public Surveys, which carried out the inquiry, concluded in 1924 that the Teapot Dome and Elk Hills leases to the oil companies had been fraudulent and corrupt, so that both Denby and Fall were forced to resign from office as a result.
“Daugherty” was Harry Micajah Daugherty (January 26, 1860 – October 12, 1941) and he was an American politician best remembered for his service as Attorney General of the United States under presidents Warren G. Harding and Calvin Coolidge, as well as for his involvement in the Teapot Dome scandal during Harding’s presidency.
Daugherty remained an influential figure behind the election of several U.S. representatives and senators and he was Harding’s campaign manager at the 1920 Republican National Convention.
Following Harding’s successful election, Daugherty was named attorney general.
Twice the subject of federal corruption investigations, Daugherty was forced in 1924 to resign his post as attorney general by Coolidge.
Which takes us back to Mencken and 1924, to wit:
To say that he (Coolidge) was not strongly in favor of both men is to utter nonsense.
He not only kept them in office as long as he could, despite the massive proofs of their unfitness; he also worked for them behind the door, stealthily and ignominiously.
To this day he has not said a single word against either of them; all his objurgations have been leveled at those who exposed them and drove them out.
He kept the asinine Teddy Roosevelt, Jr., in office until a week or so ago, and then gave him a parting salute of twenty-one guns.
He is even now trying to promote Captain Robison, the man who arranged the Doheny oil grab.
end quotes
“Doheny” is Edward Laurence Doheny (August 10, 1856 – September 8, 1935) who was an American oil tycoon who, in 1892, drilled the first successful oil well in the Los Angeles City Oil Field.
In the 1920s, Doheny was implicated in the Teapot Dome scandal and accused of offering a $100,000 bribe to United States Secretary of the Interior Albert Fall.
Doheny was twice acquitted of offering the bribe, but Fall was convicted of accepting it.
In 1922 Albert B. Fall, U.S. Secretary of the Interior, leased the oil field at Elk Hills, California, to the Pan American Petroleum & Transport Company, and around the same time, the Teapot Dome Field in Wyoming was leased to Sinclair Consolidated Oil Corporation.
Both oilfields were part of the US Navy’s petroleum reserves and neither lease was subject to competitive bidding.
In 1924 rumors about corruption in the deals escalated into the Teapot Dome scandal, and Doheny’s reputation was somewhat tainted by a bribe paid to the Secretary of the Interior, Albert B. Fall in 1921.
He (Doheny) made the “gift” of $100,000 in connection with obtaining a lease of 32,000 acres (13,000 ha) of government-owned land used for the Elk Hills Naval Petroleum Reserve near Taft, California, and the resulting scandal broke soon after that, over similar bribes Fall accepted for leasing Teapot Dome in Wyoming.
Doheny was charged with bribing Fall but, in 1930, was acquitted.
His son, Ned, who had delivered the money, and assistant Hugh Plunkett were also charged, but died before they could be tried.
Nevertheless, Fall was convicted of accepting the bribe.
end quotes
Which again takes us back to Mencken on Coolidge, to wit:
Who has forgotten that he wanted to appoint Daugherty to “investigate” that colossal steal?
Or that he was in close and constant communication with Ned McLean, Dougherty’s and Fall’s friend, during the whole of the inquiry?
No amount of campaign blather will suffice to wipe out this discreditable record.
Coolidge pulled against the oil investigation from the start; he pulled against the Dougherty investigation from the start; he let Daugherty and Denby go at last only under pressure, and after trying to hit their opponents below the belt.
His sympathy has been with such oppressed patriots all his life, and it is with them today.
If he is elected for four years every professional politician in the Republican party will rejoice, and with sound reason.
There will be good times for the boys — and Fall, Daugherty and company will be safe.
But will the country be safe?
It is not so certain.
Those businessmen who think only of easy profits tomorrow might do well to give a thought or two to the day after.
They have seen a very formidable radical movement roll up under their noses.
If they have any sense, they will not be deceived by the argument that it has been set in motion by “agitators.”
What agitators?
Who and where are they?
I can find no such persons.
La Follette stumped the country for years and got nowhere.
Only his own State heeded him.
But last winter he began to get a response, and soon it was immense and vociferous.
That response came from men and women who had become convinced at last, and with good logic, that government by professional politicians was intolerably and hopelessly rotten — that the only remedy was to turn them out, and then make laws to prevent them coming back.
Personally I doubt that such laws, if made, will work.
In other words, I am not a radical.
I believe that all government is evil, and that trying to improve it is largely a waste of time.
But that is certainly not the common American view; the majority of Americans are far more hopeful.
When they see an evil they try to remedy it — by peaceful means if possible, and if not, then by force.
In the present case millions of them tire of the degrading Coolidge farce, with its puerile evasion of issues, its cloaking of Denby and Daugherty, its exaltation of such political jugglers as Slemp and Butler, its snide conspiracy to rob La Follette of honest votes in California.
They tire of it and want to end it.
What now, if they are forced to stand four years more if it?
What if they must see it grow ever worse and worse?
To timorous businessmen, in this year 1924, La Follette may look dangerous.
But let them ask themselves what sort of radicalism will probably be afoot in 1928, after four more years of Coolidge.
end quotes
And let us ask ourselves what sort of radicalism will probably be afoot in 2028, after four more years of Joe Biden?
http://www.capecharlesmirror.com/paul-p ... ent-917018
Re: POLITICS
The New York Post
"Yellen pitches Bidenomics in Beijing — making America a laughingstock"
By Social Links for Philip Pilkington
Published April 11, 2024
Imagine your family finds your cooking so revolting, they refuse to eat it — and in response you decide it’s time to take a plate over to your neighbor’s house.
This is precisely what the Biden administration is doing with its economic platform.
It’s no secret Americans are sick of Bidenomics.
A recent Economist/YouGov survey showed 29% of voters are worried more about the economy and inflation than any other issue.
Only 22% of black Americans, 13% of Hispanics and 18% of young adults — all key would-be Biden voters — think they are better off financially than they were a year ago.
The verdict is in: Voters do not like what Joe is cooking.
Rather than reflect on these numbers, Treasury Secretary Janet Yellen found herself in China this week offering a round of slops to the locals.
Although China rolled out the red carpet for Yellen in Beijing and Guangzhou, both the Chinese and the Americans ultimately saw her visit as a failure.
Looking under the hood, it’s not hard to see why.
No matter what you think about China’s trade strategies, it is obvious they are proving very successful for the Chinese.
European car manufacturers are terrified of a tsunami of cheap, newly high-quality Chinese electric vehicles about to wash over their shores.
America seems to feel the same way about Chinese EVs, having already imposed a 27.5% tariff on them.
Yet despite Western aversion to these products, they are flooding the rest of the global market.
In 2022, China itself accounted for 60% of EV purchases and provided 35% of global EV exports — up from 4.2% in 2018.
Despite negative headlines throughout 2023, the Chinese beat their growth target of 5% for the year.
In contrast to many Western countries, they achieved this economic growth with very low inflation.
Inflation at the end of 2023 was 3.4% in both America and Europe — in China, inflation for the year came in at -0.3%.
Considering these numbers, most people would see Yellen heading over to the Middle Kingdom to give economic advice as a hard sell.
But Yellen was undeterred.
She informed the Chinese their trade practices are too aggressive and their products too cheap.
While this may be true, the alternative advice she gave them was a stretch too far: Yellen said they should embrace Bidenomics.
America’s treasury secretary told the Chinese Communists they should focus less on their competitiveness and engage in more government expenditure to generate economic growth.
News reports suggest Yellen even tried to sell the Chinese on stimulus checks — or “stimmies,” as they came to be known during the pandemic.
This is very strange advice, as the Biden “stimmie” program is now widely thought to be the first in a series of policy blunders that led to the outburst of inflation that’s made the president so unpopular.
Put yourself in the shoes of the Chinese here: Yellen’s Treasury has created a cost-of-living crisis in America, and now she wants to Chinese to sign on to her funny-money program.
It was only a decade ago that the so-called Washington Consensus encouraged other countries to embrace free-market economics and improve their competitiveness.
Now Yellen and the gang are traveling the world trying to sell the economic equivalent of magic beans.
No doubt there are problems with China flooding Western markets with its cheap goods.
The question of how to address this is a large one, but surely the answer involves trying to recreate competitive industries in Western countries.
These countries, emerging from painful inflation, have had more than enough doses of Dr. Yellen’s Magic Money Juice.
Trying to peddle the same snake oil on the world stage is, frankly, an embarrassment to the United States, which used to pride itself on sound economic management.
Washington has decided firmly, on a bipartisan basis, that it no longer wants to rely on China for cheap imports.
Policymakers are now laser-focused on trying to bring jobs back to American shores.
This is a laudable goal, but there are better and worse ways of doing it.
Creating a carnivalesque roadshow in which the US treasury secretary travels the world promoting the same harebrained economic policies that have led to so much economic pain for the average American is not a good way to go about this.
If the Chinese had signed on for regular doses of Yellen’s snake oil, it might hobble their economy and give America the edge on the world stage.
But it’s safe to predict the Chinese will “just say no” to importing Bidenomics into Beijing.
Philip Pilkington is a macroeconomist and investment professional.
https://nypost.com/2024/04/11/opinion/y ... hingstock/
"Yellen pitches Bidenomics in Beijing — making America a laughingstock"
By Social Links for Philip Pilkington
Published April 11, 2024
Imagine your family finds your cooking so revolting, they refuse to eat it — and in response you decide it’s time to take a plate over to your neighbor’s house.
This is precisely what the Biden administration is doing with its economic platform.
It’s no secret Americans are sick of Bidenomics.
A recent Economist/YouGov survey showed 29% of voters are worried more about the economy and inflation than any other issue.
Only 22% of black Americans, 13% of Hispanics and 18% of young adults — all key would-be Biden voters — think they are better off financially than they were a year ago.
The verdict is in: Voters do not like what Joe is cooking.
Rather than reflect on these numbers, Treasury Secretary Janet Yellen found herself in China this week offering a round of slops to the locals.
Although China rolled out the red carpet for Yellen in Beijing and Guangzhou, both the Chinese and the Americans ultimately saw her visit as a failure.
Looking under the hood, it’s not hard to see why.
No matter what you think about China’s trade strategies, it is obvious they are proving very successful for the Chinese.
European car manufacturers are terrified of a tsunami of cheap, newly high-quality Chinese electric vehicles about to wash over their shores.
America seems to feel the same way about Chinese EVs, having already imposed a 27.5% tariff on them.
Yet despite Western aversion to these products, they are flooding the rest of the global market.
In 2022, China itself accounted for 60% of EV purchases and provided 35% of global EV exports — up from 4.2% in 2018.
Despite negative headlines throughout 2023, the Chinese beat their growth target of 5% for the year.
In contrast to many Western countries, they achieved this economic growth with very low inflation.
Inflation at the end of 2023 was 3.4% in both America and Europe — in China, inflation for the year came in at -0.3%.
Considering these numbers, most people would see Yellen heading over to the Middle Kingdom to give economic advice as a hard sell.
But Yellen was undeterred.
She informed the Chinese their trade practices are too aggressive and their products too cheap.
While this may be true, the alternative advice she gave them was a stretch too far: Yellen said they should embrace Bidenomics.
America’s treasury secretary told the Chinese Communists they should focus less on their competitiveness and engage in more government expenditure to generate economic growth.
News reports suggest Yellen even tried to sell the Chinese on stimulus checks — or “stimmies,” as they came to be known during the pandemic.
This is very strange advice, as the Biden “stimmie” program is now widely thought to be the first in a series of policy blunders that led to the outburst of inflation that’s made the president so unpopular.
Put yourself in the shoes of the Chinese here: Yellen’s Treasury has created a cost-of-living crisis in America, and now she wants to Chinese to sign on to her funny-money program.
It was only a decade ago that the so-called Washington Consensus encouraged other countries to embrace free-market economics and improve their competitiveness.
Now Yellen and the gang are traveling the world trying to sell the economic equivalent of magic beans.
No doubt there are problems with China flooding Western markets with its cheap goods.
The question of how to address this is a large one, but surely the answer involves trying to recreate competitive industries in Western countries.
These countries, emerging from painful inflation, have had more than enough doses of Dr. Yellen’s Magic Money Juice.
Trying to peddle the same snake oil on the world stage is, frankly, an embarrassment to the United States, which used to pride itself on sound economic management.
Washington has decided firmly, on a bipartisan basis, that it no longer wants to rely on China for cheap imports.
Policymakers are now laser-focused on trying to bring jobs back to American shores.
This is a laudable goal, but there are better and worse ways of doing it.
Creating a carnivalesque roadshow in which the US treasury secretary travels the world promoting the same harebrained economic policies that have led to so much economic pain for the average American is not a good way to go about this.
If the Chinese had signed on for regular doses of Yellen’s snake oil, it might hobble their economy and give America the edge on the world stage.
But it’s safe to predict the Chinese will “just say no” to importing Bidenomics into Beijing.
Philip Pilkington is a macroeconomist and investment professional.
https://nypost.com/2024/04/11/opinion/y ... hingstock/
Re: POLITICS
FOX News
"Democrat claiming 'inflation rates are down' interrupted by higher than expected inflation report"
Story by Lindsay Kornick
12 APRIL 2024
Reality collided with a Democratic congressman’s efforts to defend President Biden’s record on inflation Wednesday morning.
South Carolina Rep. James Clyburn spoke to MSNBC’s "Morning Joe" regarding a recent focus group accusing the president of "gaslighting" them on the economy.
Though Clyburn acknowledged that people are concerned over inflation, he said inflation rates have largely come down since Biden took office.
"I do believe, just from my own observations, from the conversations I have had with people, there are concerns about things like inflation, but what we’ve got to get them to see is that inflation today is about 40% of what it was when Joe Biden took office."
"And so, the inflation rates are down, and people’s incomes are up."
"Unemployment is on the decrease."
"And although we see the prices at the stores costing more money, people are, in fact, earning greater incomes," Clyburn said.
As he spoke, co-host Mika Brzezinski interrupted him to report on the news that inflation rose faster than expected.
"So I will validate that, I think the disinformation out there is distorting the entire process, I think social media doesn’t help, but there’s also a lack of validation that these voters feel, and I’m going to bring in Andrew Ross Sorkin right now because we just got breaking news, the consumer price index increased at a faster than expected pace last month, a signal that inflation remains stubbornly high," Brzezinski reported.
Right before the news broke, Clyburn decried the "disinformation" regarding inflation.
"So what we’ve got to do is make sure that people see the policies of the Biden administration, how they affect their everyday lives, and get them to see in his policies that which is real, not what they may hear on social media."
"One of the focus-group people talked about social media and the misrepresentation, disinformation, all of those things are out there and that’s the battle that we have to fight, and we’ve got to do a better job of fighting it more effectively," Clyburn said.
The Labor Department said Wednesday that the consumer price index, a broad measure of the price of everyday goods including gasoline, groceries and rent, rose 0.4% in March from the previous month.
Prices climbed 3.5% from the same time last year, above the 3.2% figure recorded in February.
The segment referred to a focus group of undecided voters from battleground states who unanimously agreed former President Trump’s economic policies were better than Biden's and even laughed at Biden claiming otherwise.
Michigan voter Omar, who previously voted for Biden in 2020, said, "The point is, Biden needs to hear the people, because when he's talking about the economy doing stellar, he's talking about the stock market."
"He's not looking at homelessness or joblessness."
"He's not…thinking about how much it costs to go to the grocery store, and he's gaslighting literally everyone in the process."
https://www.msn.com/en-us/news/politics ... a494&ei=45
"Democrat claiming 'inflation rates are down' interrupted by higher than expected inflation report"
Story by Lindsay Kornick
12 APRIL 2024
Reality collided with a Democratic congressman’s efforts to defend President Biden’s record on inflation Wednesday morning.
South Carolina Rep. James Clyburn spoke to MSNBC’s "Morning Joe" regarding a recent focus group accusing the president of "gaslighting" them on the economy.
Though Clyburn acknowledged that people are concerned over inflation, he said inflation rates have largely come down since Biden took office.
"I do believe, just from my own observations, from the conversations I have had with people, there are concerns about things like inflation, but what we’ve got to get them to see is that inflation today is about 40% of what it was when Joe Biden took office."
"And so, the inflation rates are down, and people’s incomes are up."
"Unemployment is on the decrease."
"And although we see the prices at the stores costing more money, people are, in fact, earning greater incomes," Clyburn said.
As he spoke, co-host Mika Brzezinski interrupted him to report on the news that inflation rose faster than expected.
"So I will validate that, I think the disinformation out there is distorting the entire process, I think social media doesn’t help, but there’s also a lack of validation that these voters feel, and I’m going to bring in Andrew Ross Sorkin right now because we just got breaking news, the consumer price index increased at a faster than expected pace last month, a signal that inflation remains stubbornly high," Brzezinski reported.
Right before the news broke, Clyburn decried the "disinformation" regarding inflation.
"So what we’ve got to do is make sure that people see the policies of the Biden administration, how they affect their everyday lives, and get them to see in his policies that which is real, not what they may hear on social media."
"One of the focus-group people talked about social media and the misrepresentation, disinformation, all of those things are out there and that’s the battle that we have to fight, and we’ve got to do a better job of fighting it more effectively," Clyburn said.
The Labor Department said Wednesday that the consumer price index, a broad measure of the price of everyday goods including gasoline, groceries and rent, rose 0.4% in March from the previous month.
Prices climbed 3.5% from the same time last year, above the 3.2% figure recorded in February.
The segment referred to a focus group of undecided voters from battleground states who unanimously agreed former President Trump’s economic policies were better than Biden's and even laughed at Biden claiming otherwise.
Michigan voter Omar, who previously voted for Biden in 2020, said, "The point is, Biden needs to hear the people, because when he's talking about the economy doing stellar, he's talking about the stock market."
"He's not looking at homelessness or joblessness."
"He's not…thinking about how much it costs to go to the grocery store, and he's gaslighting literally everyone in the process."
https://www.msn.com/en-us/news/politics ... a494&ei=45
Re: POLITICS
REUTERS
"Fed's Goolsbee keeps policy focus on PCE after high consumer price readings"
By Reuters
April 12, 2024
WASHINGTON, April 12 (Reuters) - Chicago Federal Reserve President Austan Goolsbee said on Friday continued high consumer price index readings were concerning, but he remains focused on how the Fed's targeted personal consumption price expenditures index behaves.
"We've had multiple inflation readings that were higher than we wanted" for the CPI, Goolsbee said on Fox Business, but PCE "is the better measure..."
"If we start getting better readings that show us that arc of inflation coming down...that will make us feel a lot better about where we are..."
"If PCE is reinflating - we will stabilize prices."
"One month is no months," Goolsbee said, reflecting Fed policymakers' reluctance to put too much weight on a single bad data point.
But the higher-than-expected CPI readings seen in January, February and March amount to "real months" of bad data that the Fed will now have to parse in deciding whether progress towards lower inflation has stalled or will continue.
The central bank sets its 2% inflation target using the separate PCE price index, which is based on the same consumption data used to calculate gross domestic product, and therefore weights things like housing and healthcare costs differently than the CPI, which is based on a survey of consumer spending on a defined basket of goods and services.
It tends to be lower than the CPI, and even after the jump in March consumer prices, analysts this week said it was still possible PCE inflation might show a small drop for the month when the next round of data is released on April 26.
Goolsbee did not detail his policy views or predict what the Fed might do in coming meetings after a week in which investors pounced on evidence of persistent inflation to push back their own expectations for rate cuts.
But his comments do show the influence coming data releases will have on Fed policy, even among those who tended to be more optimistic that inflation will continue falling.
Goolsbee repeated for example that he is closely watching housing costs, which have defied policymaker expectations that an easing in shelter inflation was imminent.
Shelter and rising fuel prices accounted for much of the higher-than-expected consumer inflation in March, and Goolsbee said the Fed's job of restoring price stability would be tough unless housing costs behave close to how they did before the pandemic.
"The most important number to be watching on the inflation front here in the immediate term is what is happening with housing," Goolsbee said.
"If that doesn't go down to something like it was pre-COVID we will have a hard time getting the overall back to target."
Shelter costs account for about a third of the CPI and were rising around 3.2% annually in the years before the pandemic; the figure in March was 5.7%.
The Fed next meets on April 30-May 1 and is now all but certain to keep the policy interest rate steady in the current 5.25% to 5.5% range.
Reporting by Howard Schneider, Editing by Franklin Paul and Andrea Ricci
https://www.reuters.com/markets/us/feds ... 024-04-12/
"Fed's Goolsbee keeps policy focus on PCE after high consumer price readings"
By Reuters
April 12, 2024
WASHINGTON, April 12 (Reuters) - Chicago Federal Reserve President Austan Goolsbee said on Friday continued high consumer price index readings were concerning, but he remains focused on how the Fed's targeted personal consumption price expenditures index behaves.
"We've had multiple inflation readings that were higher than we wanted" for the CPI, Goolsbee said on Fox Business, but PCE "is the better measure..."
"If we start getting better readings that show us that arc of inflation coming down...that will make us feel a lot better about where we are..."
"If PCE is reinflating - we will stabilize prices."
"One month is no months," Goolsbee said, reflecting Fed policymakers' reluctance to put too much weight on a single bad data point.
But the higher-than-expected CPI readings seen in January, February and March amount to "real months" of bad data that the Fed will now have to parse in deciding whether progress towards lower inflation has stalled or will continue.
The central bank sets its 2% inflation target using the separate PCE price index, which is based on the same consumption data used to calculate gross domestic product, and therefore weights things like housing and healthcare costs differently than the CPI, which is based on a survey of consumer spending on a defined basket of goods and services.
It tends to be lower than the CPI, and even after the jump in March consumer prices, analysts this week said it was still possible PCE inflation might show a small drop for the month when the next round of data is released on April 26.
Goolsbee did not detail his policy views or predict what the Fed might do in coming meetings after a week in which investors pounced on evidence of persistent inflation to push back their own expectations for rate cuts.
But his comments do show the influence coming data releases will have on Fed policy, even among those who tended to be more optimistic that inflation will continue falling.
Goolsbee repeated for example that he is closely watching housing costs, which have defied policymaker expectations that an easing in shelter inflation was imminent.
Shelter and rising fuel prices accounted for much of the higher-than-expected consumer inflation in March, and Goolsbee said the Fed's job of restoring price stability would be tough unless housing costs behave close to how they did before the pandemic.
"The most important number to be watching on the inflation front here in the immediate term is what is happening with housing," Goolsbee said.
"If that doesn't go down to something like it was pre-COVID we will have a hard time getting the overall back to target."
Shelter costs account for about a third of the CPI and were rising around 3.2% annually in the years before the pandemic; the figure in March was 5.7%.
The Fed next meets on April 30-May 1 and is now all but certain to keep the policy interest rate steady in the current 5.25% to 5.5% range.
Reporting by Howard Schneider, Editing by Franklin Paul and Andrea Ricci
https://www.reuters.com/markets/us/feds ... 024-04-12/
Re: POLITICS
REUTERS
"Exclusive: Fed's Collins eyes about two rate cuts this year"
By Michael S. Derby
April 12, 2024
NEW YORK, April 12 (Reuters) - Federal Reserve Bank of Boston President Susan Collins is eyeing a couple of interest rate cuts this year amid expectations it could still take some time to get inflation back to targeted levels.
“I am still expecting that we're going to see some slowing in demand start and continue into 2024, and that will help to bring inflation down later in the year,” Collins said in an interview with Reuters on Thursday.
Her remarks followed a speech in which she said the Fed is likely to cut its policy rate at some point this year but that uncertainties and risks around inflation mean that the Fed needs to take its time before doing so.
The strength of the job market and the broader economy allow time for that patience, she said.
When it comes to the number of rate cuts the central bank is likely to deliver, Collins told Reuters she was “in the range of two,” referencing the quarterly forecast she submitted for the Fed's meeting in March.
The median estimate among policymaker projections released in both March and December was for three cuts totaling 75 basis points in 2024, an amount Collins had said in a SiriusXM Radio interview in February was "similar" to her baseline expectation.
As for when the Fed starts cutting rates, “the data continue to be volatile and noisy and a lot of uncertainties” abound, Collins said.
“We don't have a crystal ball in terms of how things will come out” and that means it’s not possible to say when the Fed will cut its interest rate target.
Collins was interviewed at a time when inflation data over the start of the year has shown that after last year’s swift decline in price pressures, covering the final distance toward the 2% target is proving more challenging.
At the Fed’s March policy meeting officials kept rates target steady at between 5.25% and 5.5%, where they have been since July.
Until this week, the prevailing view on Wall Street had been for cuts to begin in June, but stronger-than-expected inflation data coupled with very robust hiring reports have triggered a reset of expectations to September.
Economists at some big banks, meanwhile, have either reduced or eliminated altogether forecasts of Fed rate cuts for 2024.
Fed officials themselves still largely see cuts, and in her speech, Collins said the data means the window for an easing is now more distant, noting “it may just take more time than previously thought for activity to moderate, and to see further progress in inflation returning durably to our target.”
Some in the Fed, notably Governor Michelle Bowman, have even argued that if inflation doesn’t fall or gets worse the Fed may have to hike rates again.
Collins said a move higher is “not part of my baseline.”
With monetary policy not on a pre-set path, however, she added: “I don't think you can take possibilities as not being on the table, it really depends on where the data take us.”
Collins also told Reuters the Fed is continuing to work to make sure banks are in position to use the Fed’s lender of last resort Discount Window facility now that the Bank Term Funding Program, stood up just over a year ago to provide liquidity to banks amid a period of stress, is no longer making loans.
Collins said stigma issues still dog the Discount Window - banks have historically shunned borrowing there lest they signal to other financial institutions and regulators they’re in trouble - but progress is being made in getting banks ready to use it if needed.
The Fed is promoting preparedness and there’s “mutual interest” on the part of banks to be ready to access the facility if needed, she said.
Reporting by Michael S. Derby; Editing by Dan Burns and Diane Craft
https://www.reuters.com/markets/rates-b ... 024-04-12/
"Exclusive: Fed's Collins eyes about two rate cuts this year"
By Michael S. Derby
April 12, 2024
NEW YORK, April 12 (Reuters) - Federal Reserve Bank of Boston President Susan Collins is eyeing a couple of interest rate cuts this year amid expectations it could still take some time to get inflation back to targeted levels.
“I am still expecting that we're going to see some slowing in demand start and continue into 2024, and that will help to bring inflation down later in the year,” Collins said in an interview with Reuters on Thursday.
Her remarks followed a speech in which she said the Fed is likely to cut its policy rate at some point this year but that uncertainties and risks around inflation mean that the Fed needs to take its time before doing so.
The strength of the job market and the broader economy allow time for that patience, she said.
When it comes to the number of rate cuts the central bank is likely to deliver, Collins told Reuters she was “in the range of two,” referencing the quarterly forecast she submitted for the Fed's meeting in March.
The median estimate among policymaker projections released in both March and December was for three cuts totaling 75 basis points in 2024, an amount Collins had said in a SiriusXM Radio interview in February was "similar" to her baseline expectation.
As for when the Fed starts cutting rates, “the data continue to be volatile and noisy and a lot of uncertainties” abound, Collins said.
“We don't have a crystal ball in terms of how things will come out” and that means it’s not possible to say when the Fed will cut its interest rate target.
Collins was interviewed at a time when inflation data over the start of the year has shown that after last year’s swift decline in price pressures, covering the final distance toward the 2% target is proving more challenging.
At the Fed’s March policy meeting officials kept rates target steady at between 5.25% and 5.5%, where they have been since July.
Until this week, the prevailing view on Wall Street had been for cuts to begin in June, but stronger-than-expected inflation data coupled with very robust hiring reports have triggered a reset of expectations to September.
Economists at some big banks, meanwhile, have either reduced or eliminated altogether forecasts of Fed rate cuts for 2024.
Fed officials themselves still largely see cuts, and in her speech, Collins said the data means the window for an easing is now more distant, noting “it may just take more time than previously thought for activity to moderate, and to see further progress in inflation returning durably to our target.”
Some in the Fed, notably Governor Michelle Bowman, have even argued that if inflation doesn’t fall or gets worse the Fed may have to hike rates again.
Collins said a move higher is “not part of my baseline.”
With monetary policy not on a pre-set path, however, she added: “I don't think you can take possibilities as not being on the table, it really depends on where the data take us.”
Collins also told Reuters the Fed is continuing to work to make sure banks are in position to use the Fed’s lender of last resort Discount Window facility now that the Bank Term Funding Program, stood up just over a year ago to provide liquidity to banks amid a period of stress, is no longer making loans.
Collins said stigma issues still dog the Discount Window - banks have historically shunned borrowing there lest they signal to other financial institutions and regulators they’re in trouble - but progress is being made in getting banks ready to use it if needed.
The Fed is promoting preparedness and there’s “mutual interest” on the part of banks to be ready to access the facility if needed, she said.
Reporting by Michael S. Derby; Editing by Dan Burns and Diane Craft
https://www.reuters.com/markets/rates-b ... 024-04-12/
Re: POLITICS
REUTERS
"US consumer sentiment slips; inflation expectations increase"
By Lucia Mutikani
April 12, 2024
Summary
* Consumer sentiment index falls to 77.9 in April
* One-year inflation expectations rise to 3.1% from 2.9%
* Import prices increase 0.4% in March; up 0.4% year-on-year
WASHINGTON, April 12 (Reuters) - U.S. consumer sentiment receded in April and households expected inflation to increase over the next 12 months and beyond, likely providing more ammunition for the Federal Reserve to delay cutting interest rates until September.
The survey from the University of Michigan on Friday followed data this week that showed consumer prices increased more than expected for a third straight month in March.
Stubbornly high inflation and a strong labor market prompted financial markets and most economists to sharply dial back their expectations for the first rate cut from the U.S. central bank to September from June.
They also have lowered the number of anticipated rate cuts to two from three.
But inflation is not spiraling out of control, with producer prices increasing moderately last month.
That was reinforced by other data on Friday showing import prices excluding fuels barely rose in March after surging at the start of the year.
"This increase in inflation expectations is not what the Fed wants to see, but despite the increase, they remain in line with the recent trend and are well-anchored," said Eugenio Aleman, chief economist at Raymond James.
The University of Michigan's preliminary reading on the overall index of consumer sentiment came in at 77.9 this month, compared to a final reading of 79.4 in March.
Since January, the sentiment index has remained within a narrow range 2.5 points, well under the 5 points which the University of Michigan said was necessary for a statistically significant difference.
Economists polled by Reuters had forecast a preliminary reading of 79.0.
The dip in sentiment likely reflected higher gasoline prices and occurred despite a rally on the stock market.
Democrats were more upbeat this month than Republicans and independents.
"Overall, consumers are reserving judgment about the economy in light of the upcoming election, which, in the view of many consumers, could have a substantial impact on the trajectory of the economy," said Joanne Hsu, the director of the University of Michigan's Surveys of Consumers.
The survey's reading of one-year inflation expectations increased to 3.1% in April from 2.9% in March, rising just above the 2.3%-3.0% range seen in the two years before the COVID-19 pandemic.
The survey's five-year inflation outlook rose to a five-month high of 3.0% from 2.8% in the prior month.
Stocks on Wall Street were trading lower.
The dollar rose against a basket of currencies.
U.S. Treasury yields fell.
IMPORT PRICES INCREASE
A report from the Labor Department's Bureau of Labor Statistics showed import prices rose 0.4% in March after an unrevised 0.3% gain in February.
Economists had expected import prices, which exclude tariffs, to rise 0.3%.
In the 12 months through March, import prices rebounded 0.4%.
That was the first year-on-year increase since January 2023, and followed a 0.9% decline in February.
Imported fuel prices increased 4.7% in March after rising 1.3% in February.
Petroleum prices surged 6.0%, but natural gas prices tumbled 31.9%.
The cost of imported food shot up 1.6% after climbing 0.3% in the prior month.
Excluding fuels and food, import prices were unchanged.
These so-called core import prices edged up 0.1% in February.
Core import prices fell 0.4% on a year-on-year basis in March.
Import prices excluding fuels edged up 0.1% after rising 0.2% in the prior month.
They were unchanged on a year-on-year basis.
"Fed officials cannot lower their guard and rate cuts this year may not be as numerous as earlier forecasts had projected," said Christopher Rupkey, chief economist at FWDBONDS.
"But at least the slower increase in import prices is good news, adding to the producer prices report yesterday, that inflation pressures may not be raging completely out of control."
Boston Fed President Susan Collins told Reuters on Friday that she is eyeing a couple of rate cuts this year.
The U.S. central bank has raised its benchmark overnight interest rate by 525 basis points since March of 2022 to the current 5.25%-5.50% range, where it has been since July.
Prices for imported capital goods dropped 0.3% last month, potentially pointing to a moderation in business investment.
The cost of motor vehicles, parts and engines rose 0.2%.
Imported consumer goods prices excluding automotives fell 0.3%.
The cost of imported goods from China slipped 0.1% for the second consecutive month.
They dropped 2.6% on a year-on-year basis in March.
But prices of goods imported from Canada and Mexico increased solidly.
"With market rate-cut expectations declining in recent weeks, the dollar has rallied and bucked previous expectations for a gradual weakening," said Matthew Martin, a U.S. economist at Oxford Economics.
"The benefit, from an importer's perspective, is that a stronger dollar makes imports relatively cheaper and would support lower import price inflation in the months ahead."
Reporting by Lucia Mutikani; Editing by Chizu Nomiyama, Andrea Ricci and Paul Simao
https://www.reuters.com/world/us/us-imp ... 024-04-12/
"US consumer sentiment slips; inflation expectations increase"
By Lucia Mutikani
April 12, 2024
Summary
* Consumer sentiment index falls to 77.9 in April
* One-year inflation expectations rise to 3.1% from 2.9%
* Import prices increase 0.4% in March; up 0.4% year-on-year
WASHINGTON, April 12 (Reuters) - U.S. consumer sentiment receded in April and households expected inflation to increase over the next 12 months and beyond, likely providing more ammunition for the Federal Reserve to delay cutting interest rates until September.
The survey from the University of Michigan on Friday followed data this week that showed consumer prices increased more than expected for a third straight month in March.
Stubbornly high inflation and a strong labor market prompted financial markets and most economists to sharply dial back their expectations for the first rate cut from the U.S. central bank to September from June.
They also have lowered the number of anticipated rate cuts to two from three.
But inflation is not spiraling out of control, with producer prices increasing moderately last month.
That was reinforced by other data on Friday showing import prices excluding fuels barely rose in March after surging at the start of the year.
"This increase in inflation expectations is not what the Fed wants to see, but despite the increase, they remain in line with the recent trend and are well-anchored," said Eugenio Aleman, chief economist at Raymond James.
The University of Michigan's preliminary reading on the overall index of consumer sentiment came in at 77.9 this month, compared to a final reading of 79.4 in March.
Since January, the sentiment index has remained within a narrow range 2.5 points, well under the 5 points which the University of Michigan said was necessary for a statistically significant difference.
Economists polled by Reuters had forecast a preliminary reading of 79.0.
The dip in sentiment likely reflected higher gasoline prices and occurred despite a rally on the stock market.
Democrats were more upbeat this month than Republicans and independents.
"Overall, consumers are reserving judgment about the economy in light of the upcoming election, which, in the view of many consumers, could have a substantial impact on the trajectory of the economy," said Joanne Hsu, the director of the University of Michigan's Surveys of Consumers.
The survey's reading of one-year inflation expectations increased to 3.1% in April from 2.9% in March, rising just above the 2.3%-3.0% range seen in the two years before the COVID-19 pandemic.
The survey's five-year inflation outlook rose to a five-month high of 3.0% from 2.8% in the prior month.
Stocks on Wall Street were trading lower.
The dollar rose against a basket of currencies.
U.S. Treasury yields fell.
IMPORT PRICES INCREASE
A report from the Labor Department's Bureau of Labor Statistics showed import prices rose 0.4% in March after an unrevised 0.3% gain in February.
Economists had expected import prices, which exclude tariffs, to rise 0.3%.
In the 12 months through March, import prices rebounded 0.4%.
That was the first year-on-year increase since January 2023, and followed a 0.9% decline in February.
Imported fuel prices increased 4.7% in March after rising 1.3% in February.
Petroleum prices surged 6.0%, but natural gas prices tumbled 31.9%.
The cost of imported food shot up 1.6% after climbing 0.3% in the prior month.
Excluding fuels and food, import prices were unchanged.
These so-called core import prices edged up 0.1% in February.
Core import prices fell 0.4% on a year-on-year basis in March.
Import prices excluding fuels edged up 0.1% after rising 0.2% in the prior month.
They were unchanged on a year-on-year basis.
"Fed officials cannot lower their guard and rate cuts this year may not be as numerous as earlier forecasts had projected," said Christopher Rupkey, chief economist at FWDBONDS.
"But at least the slower increase in import prices is good news, adding to the producer prices report yesterday, that inflation pressures may not be raging completely out of control."
Boston Fed President Susan Collins told Reuters on Friday that she is eyeing a couple of rate cuts this year.
The U.S. central bank has raised its benchmark overnight interest rate by 525 basis points since March of 2022 to the current 5.25%-5.50% range, where it has been since July.
Prices for imported capital goods dropped 0.3% last month, potentially pointing to a moderation in business investment.
The cost of motor vehicles, parts and engines rose 0.2%.
Imported consumer goods prices excluding automotives fell 0.3%.
The cost of imported goods from China slipped 0.1% for the second consecutive month.
They dropped 2.6% on a year-on-year basis in March.
But prices of goods imported from Canada and Mexico increased solidly.
"With market rate-cut expectations declining in recent weeks, the dollar has rallied and bucked previous expectations for a gradual weakening," said Matthew Martin, a U.S. economist at Oxford Economics.
"The benefit, from an importer's perspective, is that a stronger dollar makes imports relatively cheaper and would support lower import price inflation in the months ahead."
Reporting by Lucia Mutikani; Editing by Chizu Nomiyama, Andrea Ricci and Paul Simao
https://www.reuters.com/world/us/us-imp ... 024-04-12/
Re: POLITICS
REUTERS
"Fed's Daly: absolutely no urgency to cut US interest rates"
By Reuters
April 12, 2024
April 12 (Reuters) - San Francisco Federal Reserve President Mary Daly said on Friday there is still "a lot of work to do" to make sure inflation is on track to the Fed's 2% goal, and there is "absolutely" no urgency to cut rates.
"Policy's in a good place right now, and I need to be fully confident that inflation is on track to come down to 2%, which is our definition of price stability, before we would consider a rate cut," Daly said at an event at the regional Fed bank.
With the labor market strong and inflation falling more slowly than it did last year, she said, the Fed will maintain its current stance "as long as necessary" to bring down inflation.
"There's absolutely, in my mind, no urgency to adjust the policy rate," she said, echoing a sentiment also expressed by several of her colleagues this week.
A government report earlier this week showed consumer price inflation was stronger than expected in March, a third upside monthly surprise this year that prompted traders and economists to pare their expectations for how soon the Fed will cut rates, and how deeply.
In March Fed policymakers generally anticipated three rate cuts, suggesting a June start to what many analysts had thought would be once-per-quarter rate reductions through year end.
After this week's inflation data financial markets are pricing in just two rate cuts.
Daly declined to say how the data affects her assessment of the number of rate cuts that will eventually be needed.
"I actually think there's too much discussion about is it going to be two or three or four or one, and not enough discussion on what are we trying to accomplish and are we still committed to accomplishing it?" she said.
Inflation's progress downward was always going to be bumpy she said, but "the commitment we have remains the same: restore price stability as gently as we can and maintain our policy stance as long as is necessary to be fully confident that we're on that path.
Reporting by Ann Saphir; editing by Diane Craft
https://www.reuters.com/markets/us/feds ... 024-04-12/
"Fed's Daly: absolutely no urgency to cut US interest rates"
By Reuters
April 12, 2024
April 12 (Reuters) - San Francisco Federal Reserve President Mary Daly said on Friday there is still "a lot of work to do" to make sure inflation is on track to the Fed's 2% goal, and there is "absolutely" no urgency to cut rates.
"Policy's in a good place right now, and I need to be fully confident that inflation is on track to come down to 2%, which is our definition of price stability, before we would consider a rate cut," Daly said at an event at the regional Fed bank.
With the labor market strong and inflation falling more slowly than it did last year, she said, the Fed will maintain its current stance "as long as necessary" to bring down inflation.
"There's absolutely, in my mind, no urgency to adjust the policy rate," she said, echoing a sentiment also expressed by several of her colleagues this week.
A government report earlier this week showed consumer price inflation was stronger than expected in March, a third upside monthly surprise this year that prompted traders and economists to pare their expectations for how soon the Fed will cut rates, and how deeply.
In March Fed policymakers generally anticipated three rate cuts, suggesting a June start to what many analysts had thought would be once-per-quarter rate reductions through year end.
After this week's inflation data financial markets are pricing in just two rate cuts.
Daly declined to say how the data affects her assessment of the number of rate cuts that will eventually be needed.
"I actually think there's too much discussion about is it going to be two or three or four or one, and not enough discussion on what are we trying to accomplish and are we still committed to accomplishing it?" she said.
Inflation's progress downward was always going to be bumpy she said, but "the commitment we have remains the same: restore price stability as gently as we can and maintain our policy stance as long as is necessary to be fully confident that we're on that path.
Reporting by Ann Saphir; editing by Diane Craft
https://www.reuters.com/markets/us/feds ... 024-04-12/
Re: POLITICS
POLITICO
"Biden’s risky new bet: the stock market - The president and his aides have begun touting stock market gains, a messaging shift that makes some Democrats uneasy."
By JASPER GOODMAN
02/14/2024 09:17 AM EST
President Joe Biden is starting to sound a little more like his predecessor.
He wants you to know how great the stock market is doing under his watch.
It’s a messaging shift that makes some Democrats uneasy, given the likelihood of market volatility and the inequality among investors.
It’s also a break from Biden’s own stance during the last election when he knocked then-President Donald Trump for focusing on the strength of stocks.
“He thinks the economy is doing well if the Dow Jones is doing well,” Biden said on X, formerly Twitter, in October 2020.
“Believe it or not, Mr. President, most Americans don’t live off the stock market.”
Fast forward to last Saturday, when Biden used X to tout “good news” for folks to start the weekend: “The stock market going strong is a sign of confidence in America’s economy.”
Tuesday’s steep drop in stocks, triggered by unexpectedly strong inflation data, illustrated the risks in the approach.
The new messaging comes as poll after poll shows deep skepticism from voters on Biden’s handling of the economy.
“If I were there, I’d be telling the president: ‘Stock markets go up, but stock markets also go down,’” said Jason Furman, a top economic adviser to former President Barack Obama.
“You’re taking a risk if you’re resting too much of your case on something that could prove ephemeral.”
Trump not only took credit for the stock market’s run during his administration, but he’s also tried to argue that the most recent surge can be attributed to anticipation of his return to office.
Jared Bernstein, the chair of the White House Council of Economic Advisers, said in an interview that the administration’s recent posts trumpeting the stock market were not a response to the former president.
Bernstein, a long-time Biden aide, said it’s “just our team’s substantive take on a set of forces that look like they’re in play in this rally.”
White House communications director Ben LaBolt posted on X Saturday that “Americans are going to be happy with their 401(k) statements,” a message that Bernstein reposted and cheered on from his own X account.
“No one’s saying anything about where the market is headed,” Bernstein said on a call Monday, adding that the messaging push was about the rally over the past few months.
“We think some of the forces behind the rally are those that this president has helped to put in play.”
He pointed to reversed recession expectations, a bright domestic investment outlook driven by Biden’s legislative agenda, and the strength of the U.S. economy compared to global competitors.
And to be sure, the president’s speeches focus largely on the real economy, not the markets.
When politicians try to take credit for rising stocks, there’s not only the risk that share prices will fall.
It also draws attention to the fact that the market delivers the biggest benefits to those who are already well-off.
The wealthiest Americans are far more likely to hold stocks than those with lower incomes.
Josh Bivens, chief economist at the left-leaning Economic Policy Institute, said stock market gains are “really about how the wealthiest are faring” and are “mostly irrelevant to most peoples’ real economic circumstances.”
Bernstein acknowledges that direct stock holdings are concentrated among the wealthiest, but he highlights that many middle-class families are invested in retirement accounts.
“We’re going to fight hard to maintain the strength in the real economy — particularly the job market — while continuing to put downward pressure on prices because that’s what leads to stronger paychecks, and that is absolutely at the core."
"But for a lot of people — even in the middle class — a rising stock market is an important benefit,” Bernstein said.
“The fact that some of the forces that have been supporting the rally relate to the president’s agenda — that seems like fair game to point out.”
https://www.politico.com/news/2024/02/1 ... t-00141387
"Biden’s risky new bet: the stock market - The president and his aides have begun touting stock market gains, a messaging shift that makes some Democrats uneasy."
By JASPER GOODMAN
02/14/2024 09:17 AM EST
President Joe Biden is starting to sound a little more like his predecessor.
He wants you to know how great the stock market is doing under his watch.
It’s a messaging shift that makes some Democrats uneasy, given the likelihood of market volatility and the inequality among investors.
It’s also a break from Biden’s own stance during the last election when he knocked then-President Donald Trump for focusing on the strength of stocks.
“He thinks the economy is doing well if the Dow Jones is doing well,” Biden said on X, formerly Twitter, in October 2020.
“Believe it or not, Mr. President, most Americans don’t live off the stock market.”
Fast forward to last Saturday, when Biden used X to tout “good news” for folks to start the weekend: “The stock market going strong is a sign of confidence in America’s economy.”
Tuesday’s steep drop in stocks, triggered by unexpectedly strong inflation data, illustrated the risks in the approach.
The new messaging comes as poll after poll shows deep skepticism from voters on Biden’s handling of the economy.
“If I were there, I’d be telling the president: ‘Stock markets go up, but stock markets also go down,’” said Jason Furman, a top economic adviser to former President Barack Obama.
“You’re taking a risk if you’re resting too much of your case on something that could prove ephemeral.”
Trump not only took credit for the stock market’s run during his administration, but he’s also tried to argue that the most recent surge can be attributed to anticipation of his return to office.
Jared Bernstein, the chair of the White House Council of Economic Advisers, said in an interview that the administration’s recent posts trumpeting the stock market were not a response to the former president.
Bernstein, a long-time Biden aide, said it’s “just our team’s substantive take on a set of forces that look like they’re in play in this rally.”
White House communications director Ben LaBolt posted on X Saturday that “Americans are going to be happy with their 401(k) statements,” a message that Bernstein reposted and cheered on from his own X account.
“No one’s saying anything about where the market is headed,” Bernstein said on a call Monday, adding that the messaging push was about the rally over the past few months.
“We think some of the forces behind the rally are those that this president has helped to put in play.”
He pointed to reversed recession expectations, a bright domestic investment outlook driven by Biden’s legislative agenda, and the strength of the U.S. economy compared to global competitors.
And to be sure, the president’s speeches focus largely on the real economy, not the markets.
When politicians try to take credit for rising stocks, there’s not only the risk that share prices will fall.
It also draws attention to the fact that the market delivers the biggest benefits to those who are already well-off.
The wealthiest Americans are far more likely to hold stocks than those with lower incomes.
Josh Bivens, chief economist at the left-leaning Economic Policy Institute, said stock market gains are “really about how the wealthiest are faring” and are “mostly irrelevant to most peoples’ real economic circumstances.”
Bernstein acknowledges that direct stock holdings are concentrated among the wealthiest, but he highlights that many middle-class families are invested in retirement accounts.
“We’re going to fight hard to maintain the strength in the real economy — particularly the job market — while continuing to put downward pressure on prices because that’s what leads to stronger paychecks, and that is absolutely at the core."
"But for a lot of people — even in the middle class — a rising stock market is an important benefit,” Bernstein said.
“The fact that some of the forces that have been supporting the rally relate to the president’s agenda — that seems like fair game to point out.”
https://www.politico.com/news/2024/02/1 ... t-00141387