Inflation surges as consumer prices leap 5%, biggest jump since 2008 –
Inflation continued to surge in May, with consumer prices accelerating at the fastest pace in more than 12 years as the economy emerges from the pandemic, the feds said Thursday.
The Labor Department’s Consumer Price Index, which measures a basket of goods and services as well as energy and food costs, jumped 5 percent in May from a year earlier.
That’s higher than April’s 4.2 percent year-over-year rise in prices, and the biggest 12-month rise since August 2008, just before the financial crisis sent the US into the worst recession it had seen since the Great Depression.
For the past several months we have warned about the pernicious effects soaring prices are having on both corporations (“Buckle Up! Inflation Is Here!”) and consumers (“”This Is Not Transitory”: Hyperinflation Fears Are Soaring Across America”), prompting even otherwise boring sellside research to get (hyper) exciting, with Deutsche Bank (which warned this week that “Inflation Is About To Explode “Leaving Global Economies Sitting On A Time Bomb””) and Bank of America (which “Just Threw Up All Over The Fed’s “Transitory” Argument”) now openly claiming that the Fed is wrong, and the US is facing an unprecedented period of far higher, non-transitory inflation, with DB going so far as to warn “policymakers will face the most challenging years since the Volcker/Reagan period in the 1980s.”
But none of this has spooked the Fed into conceding – or believing – that inflation is anything more than transitory. And maybe just this once, the Fed has a point because all else equal, by which we mean lack of rising wages, the best cure to higher prices is, well… higher prices.
Biden says to ‘go ahead’ for $50,000 in student-debt cancellation
“But Schumer, Warren, and other Democrats want Biden to go big on debt cancellation, and they believe he can cancel $50,000 in debt now with “the stroke of a pen.”
“The time is now,” Warren told Insider on Tuesday. “We know what the problem is: student loan debt is holding back tens of millions of people across this country. People who can’t buy homes, people who can’t buy cars, people who can’t start small businesses. We need to cancel that student loan debt, not only for those people individually, but for our whole economy.”
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