Joe Biden’s economic policies have been a catastrophic disaster.
It’s only about to get much worse.
And it’s all because of one horrible inflation report that signals the United States is about to enter a recession under Biden’s watch.
The U.S. economy is teetering on the brink of disaster.
After the latest consumer sentiment and inflation report was released, it is now clear that America is barreling head-first into an economic crisis larger than any seen since at least the 2020 Covid Crash, and possibly since the 2008 Financial Crisis.
The American Institute of Economic Research reports, “The preliminary June results from the University of Michigan Surveys of Consumers show overall consumer sentiment plunged again in early June (see first chart). The composite consumer sentiment decreased to 50.2 in early June, down from 58.4 in May, a loss of 8.2 points or 14.0 percent. The index is at a record low and consistent with prior recessions.
Both component indexes posted sharp declines. The current-economic-conditions index fell to 55.4 from 63.3 in May (see first chart). That is a 7.9-point or 12.5 percent decrease for the month and leaves the index at a record low.”
This index, which tracks one of the most important metrics in the entire American economy, just hit a low point that hasn’t been seen in most people’s lifetimes.
Making matters significantly worse, inflation managed to grow year over year, with the metric up around 8.6% from May 2021 to May 2022.
All of this indicates that inflation is showing no signs of slowing down, and indeed is actually getting worse in many cases.
And with little response coming from the White House or the Federal Reserve, the United States could be in for a return of 1970s-style stagflation.
In fact, real wages are also on the decline.
CNBC reports, “Those escalating prices meant workers took another pay cut during the month. Real wages when accounting for inflation fell 0.6% in April, even though average hourly earnings rose 0.3%, according to a separate BLS release. On a 12-month basis, real average hourly earnings were down 3%.”
When taken as a whole, all of these metrics suggest that the American economy is reaching a breaking point.
Not only is inflation eating away at most family’s savings and monthly expenses, but wages are falling and consumer sentiment is collapsing at a record pace.
What’s more, the stock market is dropping as well as fears mount that a recession is already here.
Of course, Biden’s response to the crisis has been lackluster.
Not only has he refused to call for a cut in runaway government spending which is fueling the inflation crisis, but he has also refused to call on the Federal Reserve to take action to raise interest rates faster in order to quell it.
In fact, the Federal Reserve deserves more responsibility for the disaster than even Biden.
It was the Federal Reserve that printed 5 trillion dollars and injected it into the economy, driving up asset prices while also eroding the value of the dollar.
And now, the American people are reaping the disaster that Biden and the Fed have sown.