Tag: inflation

How Blackrock Investment Fund Triggered the Global Energy Crisis

Most people are bewildered by what is a global energy crisis, with prices for oil, gas and coal simultaneously soaring and even forcing closure of major industrial plants such as chemicals or aluminum or steel. The Biden Administration and EU have insisted that all is because of Putin and Russia’s military actions in Ukraine. This is not the case. The energy crisis is a long-planned strategy of western corporate and political circles to dismantle industrial economies in the name of a dystopian Green Agenda. That has its roots in the period years well before February 2022, when Russia launched its military action in Ukraine.

Blackrock pushes ESG

In January, 2020  on the eve of the economically and socially devastating covid lockdowns, the CEO of the world’s largest investment fund, Larry Fink of Blackrock, issued a letter to Wall Street colleagues and corporate CEOs on the future of investment flows. In the document, modestly titled “A Fundamental Reshaping of Finance”, Fink, who manages the world’s largest investment fund with some $7 trillion then under management, announced a radical departure for corporate investment. Money would “go green.” In his closely-followed 2020 letter Fink declared,

“In the near future – and sooner than most anticipate – there will be a significant re-allocation of capital…Climate risk is investment risk.” Further he stated, “Every government, company, and shareholder must confront climate change.” [i]

In a separate letter to Blackrock investor clients, Fink delivered the new agenda for capital investing. He declared that Blackrock will exit certain high-carbon investments such as coal, the largest source of electricity for the USA and many other countries. He added that Blackrock would screen new investment in oil, gas and coal to determine their adherence to the UN Agenda 2030 “sustainability.”

Fink made clear the world’s largest fund would begin to disinvest in oil, gas and coal.  “Over time,” Fink wrote, “companies and governments that do not respond to stakeholders and address sustainability risks will encounter growing skepticism from the markets, and in turn, a higher cost of capital.” He added that, “Climate change has become a defining factor in companies’ long-term prospects… we are on the edge of a fundamental reshaping of finance.” [ii]

From that point on the so-called ESG investing, penalizing CO2 emitting companies like ExxonMobil, has become all the fashion among hedge funds and Wall Street banks and investment funds including State Street and Vanguard. Such is the power of Blackrock. Fink was also able to get four new board members in ExxonMobil committed to end the company’s oil and gas business.

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Another Grocery Staple Surging to Record High – The Days of Cheap Breakfasts Are Gone

Joe Biden alone has already caused the price of everyday staples to soar, but there are other pressures also forcing an increased burden to fall on all Americans.

Thanks to those external pressures, this month, yet another staple food item has soared to prices that won’t come down any time soon.

Coffee is absolutely essential for millions, and many Americans claim they can’t get their day in gear if they don’t have a jolting cup of Joe, and they don’t mean Biden.

But there will soon be more financial pain going forward with your morning cup. Get ready to see your coffee prices given a jolt as supply problems, hoarding, and contract defaults are tearing through the coffee producing industry worldwide causing prices to soar. This is only adding to the skyrocketing costs of breakfast, which is at its highest point since 1979 as it is. And experts say those higher prices won’t go away any time soon, if ever.

The cost of robusta coffee beans soared more than 30 percent early in April and 50 percent now as a heat wave has settled in over Vietnam in one of the world’s top coffee growing regions, according to Bloomberg.

The price jump for robusta has also put pressure on arabica coffee, causing arabica futures to rise more than 3 percent, surpassing the $2-per pound mark for the first time since December, the outlet added.

“Weather conditions are not encouraging,” representatives of London-based importer DRWakefield said this week. “There are still concerns over a possible water shortage for irrigation, which may hurt the output of the next season.”

About 40 percent of the world’s coffee supply is made up of robusta beans whereas the arabica bean is the source of around 60 percent, according to Nespresso.

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California Fast Food Prices Skyrocket Following Imposition of $20 Minimum Wage

The price of fast food restaurants in California has surged after the state imposed a $20 minimum wage law.

According to an analysis from Kalinowski Equity Research, fast-food restaurants across the Golden State have hiked prices by around eight percent since the law went into effect at the beginning of this month.

The New York Post reports:

Wendy’s raised its menu prices by around 8% while Chipotle Mexican Grill hiked its prices by approximately 7.5%. Starbucks, the Seattle-based coffee chain, raised the prices of its menu items at its California locations by around 7%, while Taco Bell hiked its prices 3%, the report found.

…

It found that Burger King instituted an average price increase of 1.4% for its Whopper Meal and 2.1% for its BK Royal Crispy Chicken Meal at the 25 locations. The report’s authors did the same for Chipotle, which was found to have boosted the price of its Chicken Burrito by 8.3% and its Steak Burrito by 7% at 25 locations in California between Feb. 7 and April 2.

Wendy’s also instituted substantial price hikes on staple menu items such as Dave’s Combo and the Classic Chicken Sandwich Combo. In a comparison of prices from Feb. 12 and April 2 at 25 Wendy’s stores in California, the company raised the price of both items by an average of 8%. McDonald’s appears to be the only fast food chain that has largely held off on raising its menu item prices, according to the report.

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Kilo-WHAT?-hours: Electricity prices soar by nearly 30% under the Biden administration

Prices of electricity have been hunting budget-sensitive households since President Joe Biden assumed the presidency. Families have experienced an astronomical rise in the costs, well outpacing inflation with a 29.4 percent jump in price from 2021. The prices are now almost double that of inflation and skyrocketed thirteen times faster than they had in the seven years before 2021.

The data showed that the energy index rose by 1.1 percent in March following a 2.3 percent increase in February. Despite the Federal Reserve holding interest rates steady since July 2023, inflation continues to pose a problem for policymakers and households.

“There is no improvement here, we’re moving in the wrong direction,” said Bankrate Chief Financial Analyst Greg McBride in an interview with Fox Business. “The usual trouble spots persist, like shelter, motor vehicle insurance, maintenance, repairs and service costs. Add electricity to that list, up 0.9 percent in March and five percent over the past year.”

Part of the reason for the surge in energy prices is due to the push to replace fossil fuels and nuclear power plants with renewable subsidies and green-energy mandates.

Gasoline prices also continue to hit American pocketbooks hard. Though prices have fallen off their peak from 2022, the cost of gasoline remains 52.1 percent higher than it was when Biden first took office. The gasoline and electricity index also increased in March, climbing 1.7 percent and 0.9 percent, respectively.

The Biden government has depleted much of the Strategic Petroleum Reserve in an effort to bring down gasoline costs. However, the relief has only been temporary, with prices again starting to rise across the country. Moreover, the Bureau of Labor Statistics (BLS) reported that the energy index jumped 2.1 percent.

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The U.S. national debt is rising by $1 trillion about every 100 days

The debt load of the U.S. is growing at a quicker clip in recent months, increasing about $1 trillion nearly every 100 days.

The nation’s debt permanently crossed over to $34 trillion on Jan. 4, after briefly crossing the mark on Dec. 29, according to data from the U.S. Department of the Treasury. It reached $33 trillion on Sept. 15, 2023, and $32 trillion on June 15, 2023, hitting this accelerated pace. Before that, the $1 trillion move higher from $31 trillion took about eight months.

U.S. debt, which is the amount of money the federal government borrows to cover operating expenses, now stands at nearly $34.4 billion, as of Wednesday. Bank of America investment strategist Michael Hartnett believes the 100-day pattern will remain intact with the move from $34 trillion to $35 trillion.

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The Average U.S. Household Is Spending $1,019 More A Month Just To Buy The Same Goods And Services It Did 3 Years Ago

It seems odd to talk about 2021 as “the good old days”, but the truth is that the cost of living was far lower just three short years ago.  Earlier today, I did an interview with Sam Rohrer of Stand In The Gap Today in which we discussed how food prices have gotten wildly out of control.  One example that I brought up was the fact that a Big Mac “value meal” can cost up to 18 dollars in some parts of the country.  There is no way that I would shell out 18 bucks for a burger, some fries and a drink at McDonald’s.  But this is the economic environment that we live in today.

Has your income gone up by more than a thousand dollars a month over the past three years?

If not, you are falling behind.

According to economist Mark Zandi, the average U.S. household is now shelling out an additional $1,019 a month just to purchase the exact same goods and services that it did three years ago…

The typical U.S. household needed to pay $213 more a month in January to purchase the same goods and services it did one year ago because of still-high inflation, according to new calculations from Moody’s Analytics chief economist Mark Zandi.

Americans are paying on average $605 more each month compared with the same time two years ago and $1,019 more compared with three years ago, before the inflation crisis began.

In the old days, I actually enjoyed going to the grocery store.

But now it has become such a painful experience.

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The Sindex: Cigarette Prices Outpacing Inflation

Inflation stressing you out? Making you wish you had just a touch of nicotine in your system? Unfortunately, that’ll cost a lot. While prices economywide have risen 3.1 percent in the last year, cigarette prices have jumped 8 percent. On top of federal and state taxes that often make up half the price of a pack, tobacco companies tend to raise their prices faster than inflation to make up for declining sales volume. These and the rest of the numbers in the Reason Sindex use data from November 2023.

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Biden’s Bizarre ‘Shrinkflation’ Nonsense

When President Joe Biden was running for office in 2020, he explicitly promised that putting him in the White House would mean that “you’ll actually see your standard of living go up and your costs go down.”

That, uh, hasn’t happened.

We don’t need to relitigate the entire economic history of the Biden administration in this space, but here’s a quick recap: Inflation surged to a 40-year high, peaking above 9 percent in June 2022. Prices are now rising less quickly, but inflation remains well above the Federal Reserve’s target rate of 2 percent. (It was 3.4 percent for the 12 months ending in December. We’ll get January’s numbers on Tuesday morning.) Biden’s policies—specifically, the $2 trillion spending package he signed in March 2021—certainly contributed to that inflationary spiral. Economists will continue to debate how much of a factor it was, but voters tend to operate on a more facile level of rewarding presidents for good economic times and punishing them for bad economic times. And rightly or only semi-rightly, Biden’s name is attached to this bout with inflation.

You might expect the president, now that he’s in the middle of a re-election campaign, to try to avoid anything to do with that topic. Don’t remind voters of how rough the past few years have been, focus on the future, talk about the positive signals coming from the economy, and above all else don’t make yourself look like an old man yelling at a cloud.

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Record number of Americans are homeless amid nationwide surge in rent, report finds

A growing number of Americans are ending up homeless as soaring rents in recent years squeeze their budgets.

According to a Jan. 25 report from Harvard’s Joint Center for Housing Studies, roughly 653,000 people reported experiencing homelessness in January of 2023, up roughly 12% from the same time a year prior and 48% from 2015. That marks the largest single-year increase in the country’s unhoused population on record, Harvard researchers said. 

Homelessness, long a problem in states such as California and Washington, has also increased in historically more affordable parts of the U.S.. Arizona, Ohio, Tennessee and Texas have seen the largest growths in their unsheltered populations due to rising local housing costs. 

That alarming jump in people struggling to keep a roof over their head came amid blistering inflation in 2021 and 2022 and as surging rental prices across the U.S. outpaced worker wage gains. Although a range of factors can cause homelessness, high rents and the expiration of pandemic relief last year contributed to the spike in housing insecurity, the researchers found. 

“In the first years of the pandemic, renter protections, income supports and housing assistance helped stave off a considerable rise in homelessness. However, many of these protections ended in 2022, at a time when rents were rising rapidly and increasing numbers of migrants were prohibited from working. As a result, the number of people experiencing homelessness jumped by nearly 71,000 in just one year,” according to the report.

Rent in the U.S. has steadily climbed since 2001. In analyzing Census and real estate data, the Harvard researchers found that half of all U.S. households across income levels spent between 30% and 50% of their monthly pay on housing in 2022, defining them as “cost-burdened.” Some 12 million tenants were severely cost-burdened that year, meaning they spent more than half their monthly pay on rent and utilities, up 14% from pre-pandemic levels.

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EVERYONE LOVES A GENEROUS GOVERNMENT UNTIL THEY HAVE TO PAY FOR IT

Governments, like individuals, can spend liberally with great generosity, or they can be frugal. Everyone receiving government money loves the state’s free-spending generosity, as it is “free money” to the recipients.

But there is no such thing as truly “free money,” a reality discussed by Niccolo Machiavelli in his classic work on leadership and statecraft, The Prince, published in 1516. In Machiavelli’s terminology, leaders could either pursue the positive reputation of being liberal in their spending (not “liberal” in a political sense) or suffer the negative reputation of being mean, i.e. miserly, tight-fisted and frugal.

Machiavelli pointed out that the spending demanded to maintain the reputation for free-spending liberality soon exhausted the funds of the state and required the leader to levy increasingly heavy taxes on the citizenry to pay for the state’s largesse.

Once we examine this necessary consequence of liberal spending, it turns out the generous government is anything but generous, as it is eventually forced to impoverish its people to support its spending.

It is the miserly leader and state that is actually generous, for it is the miserly leader / state that places a light burden on the earnings and livelihoods of the citizenry.

As Machiavelli explained, taxes and the inflation that comes with free spending both rob everyone, while the state’s generosity is a political process that necessarily distributes the largesse asymmetrically:

If he is wise he ought not to fear the reputation of being mean, for in time he will come to be more considered than if liberal, seeing that with his economy his revenues are enough, that he can defend himself against all attacks, and is able to engage in enterprises without burdening his people; thus it comes to pass that he exercises liberality towards all from whom he does not take, who are numberless, and meanness towards those to whom he does not give, who are few.

The profligate state and leader fail, for their resources are squandered.

We have not seen great things done in our time except by those who have been considered mean; the rest have failed. A prince, therefore, provided that he has not to rob his subjects, that he can defend himself, that he does not become poor and abject, that he is not forced to become rapacious, ought to hold of little account a reputation for being mean, for it is one of those vices which will enable him to govern.

Machiavelli understood that the positive reputation generated by profligacy decays as quickly as solvency. Everyone loves getting “free money” from the state until the bill comes due: the decay of purchasing power (i.e. inflation), higher taxes and fees, and the ever-increasing burdens of interest to be paid on soaring state debts that squeezes out all other spending.

And there is nothing wastes so rapidly as liberality, for even whilst you exercise it you lose the power to do so, and so become either poor or despised, or else, in avoiding poverty, rapacious and hated. And a prince should guard himself, above all things, against being despised and hated; and liberality leads you to both. Therefore it is wiser to have a reputation for meanness which brings reproach without hatred, than to be compelled through seeking a reputation for liberality to incur a name for rapacity which begets reproach with hatred.

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