Real Danger Alert: Inflation is Up, a Lot, Even According to the Government
The federal government's most conservative and minimizing measure of inflation -- the Personal Consumption Expenditures Price index, which ignores food and energy -- rose a stunning 0.7% in April after rising 0.4% in March, according to the Bureau of Economic Analysis. If this two-month increase continues at the same pace, annual inflation would be more than 6%. And that is without counting the big jumps in food and energy costs (because who eats or uses fuel?).
In other words, the government's lowest measure of inflation, specifically designed to minimize inflation as much as possible, is up significantly and moving higher.
That matters because rising inflation -- if it rises enough and lasts long enough -- will eventually force up interest rates. High interest rates will be the death knell for the booming stock and real estate markets that have been thriving on the Federal Reserve's massive money printing and ultra-low interest rates.
We will certainly be tracking this closely and letting you know how it progresses. In the meantime, here's a great article about the current upsurge in inflation from one of our favorite truth tellers, Wolf Richter of Wolf Street: