And what a “dog” these Democrats have turned our economy into in a span of just two years. Remember when we were producing growth clips North of 4-5% annually under Donald Trump? Didn’t take Recessionary Joe, House Speaker Nancy Pelosi, and Senate Majority Leader Chuck Schumer, along with their fellow Socialists, long to destroy it. Everyone’s heard the news by now, the United States “officially” entered into a recession with the second quarter of negative growth released this morning. And how did Wall Street react to the news? Investors seemed to celebrate the announcement – yes as the U.S. Titanic slowly sinks, instead of searching for the nearest life raft, no Wall St. decided [by golly] to hold a massive party to the very end, and party they did. Maybe they’re onto something, I mean if your personal pile of money is going into an incinerator anyway, why not party your ass off right? But Recessionary Joe’s White House Staff continues to profess that we’re [really not] in an actual recession, and we’re never going to be in a recession on his watch. 🙂 You see, Recessions don’t exist under Democrat Administrations, they only exist when Republicans are in office, because Republicans face the music, we tell the truth, be that good, bad, or ugly, whereas Democrats will duck and dodge the truth continuously. The official word out of this White House is that the U.S. economy is just stuck in a slow motion movie, that’s all. They keep harping on lagging indicators as proof – look at how many job openings we still have out there they say, never mind the fact that you would need to hold down three of them [and at the same time] just to keep pace with Joe’s 15% annual inflation rate. 🙂 That’s something the White House hopes you won’t realize until you’ve voted for all their Socialists to return to office.

I fear that it will be different this time, this recession. I think U.S. inflation can stick around for an extended period of time. Sheila Bair, a very smart lady who once headed up the FDIC as a bank regulator, and has held other important positions such as Assistant Secretary of the Treasury, pointed out something today in an interview. She said, hiking short-term rates is one thing, it’s expected in this situation, as is the Federal Reserve reducing their massive [ballooned-out] balance sheet but she stated the fact that this Federal Reserve and Treasury Department are ignoring the biggest opportunity to squash inflation in its tracks is evidence of yet another major policy error. [How many times have I mentioned how this administration has created “policy” blunders in my past blog posts? Well, here’s just one more.] Sheila was referring to the fact that the Federal Reserve is not targeting the reduction of the supply of money, specifically M2. She went on to say that anytime this has been ignored in the past inflation has hung around, it’s been sticky. I think she’s right, this is how Paul Volcker squashed the last bout of U.S. hyper-inflation back in the late 1970’s, early ’80’s, he targeted M2. We have to reduce the amount of money floating around out there, tighten the supply of money instead of loosening it. This is the strongest evidence that we may be in for an extended period of higher inflation. You might be wondering which asset classes do better during periods of rising and/or high inflation levels? You may want to reach out to your personal financial advisors on that subject.

Will Democrats [Socialists] ever understand this “golden rule” for stamping out inflationary pressures? The answer is evident, never! Democrats got us into this mess but they do not have the intellect nor the training to get us back out of it. Democrats do not understand the root causes of inflation or even how to run a sustainable free and open market, or purely capitalist economy. They’re much better at planning dictatorships.

So what’s next? We could end up with a Zombie economy effectively, a walking dead economy where the Federal Reserve will need to add stimulus program after stimulus program [in the future] just to reach 1.5% annual rates of growth while inflation will remain stubbornly high, and for an extended period of time. [This is the very reason that stocks rallied in the last couple days of trading, many are now expecting the Fed to be lowering rates back down as early as next year, but how and why? They expect muted, very tepid growth because of the Democrat Party’s continuous over-regulating interfering in the activity of commerce, plus their tax increases]. Will that provide a permanent fix to relieve inflationary pressures? It won’t, it will not be enough to make us whole again, a return to the 2% annual inflation rates we experienced under Donald Trump’s Administration. We already covered the permanent fix for inflation, which Democrat lawmakers are ignoring completely. In other words, expect your spending power to continue to decay in the weeks, months, and years ahead, as long as these levels of inflation remain pervasive. I would give this “sticky” inflation scenario a better than 50% probability of where our economy could morph from here, a period of what is known as “stagflation”, characterized by a combination of high inflation and very sluggish growth. Good luck to retailers selling anything, especially those high ticket items?… but by all means, you folks keep voting these clueless Socialists into office, ya hear? LMAO!