News Story of the Day: the Federal Reserve will not be raising interest rates this year because of a weak economy and labor market and low inflation levels, says a new report from the Wall Street Journal.
The newspaper cited a handful of members of the United States central bank who also say that a rate hike isn’t coming for the remainder of the year. Moreover, the Federal Open Market Committee (FOMC) noted that a delay in a rate hike last month was due to a stuttering global economy. If this was the case in September then it will be the same case for the next couple of months, the newspaper stated.
“While an October move is highly unlikely, the Fed could still decide to push rates up this year, particularly if the labor market shows renewed signs of vigor before its Dec. 15-16 policy meeting, or if signs emerge that wages or inflation are moving up from low levels,” writes the Journal.
In addition, half of the Fed districts referred to economic expansion as “modest,” and three other districts called it “moderate.” Two listed growth as slower, two others said it was better and one declined to comment.
Six of the 12 Fed districts called the expansion “modest,” while three reported “moderate” growth. Boston and Richmond cited better economic activity, while Kansas City declined. Chicago and Richmond said growth was slower compared with the prior three-month period.
Chart of the Day: despite tumbling disposable incomes and the rising cost of food, American consumers are still heading outside to fill their bellies. The country is split when it comes to monthly food sales at home compared to away from the home. Over the past decade, the gap has continually shrunk. Perhaps its time for today’s generation of consumers learn how to cook! (The chart is courtesy of the American Enterprise Institute.)
Illustration of the Day: 2016 Democratic presidential candidate and Vermont Senator Bernie Sanders needs a lesson in economics. For instance, during this week’s debates, he kept talking about income inequality. However, he never once mentioned the root cause: the Federal Reserve.
Due to his lack of knowledge in the subject, there is a crowdfunding initiative to raise more than $3,000 so Sanders can attend an economics course with Walter Block at Loyola University New Orleans. If Sanders refuses to attend then the funds will be donated to Feed My Starving Children.
Quote of the Day: today’s quote comes from Peter Schiff, CEO of Euro Pacific Capital, who pontificates on the demise of the U.S. dollar. The quote is spot on: it’s pretty much impossible for the greenback to sustain itself with money printing, bond purchasing and debt monetization.
“At some point, the dollar has to give. You can’t just keep printing money, and monetizing debt, and buying bonds, without the dollar imploding.”
Video of the Day: Donald Trump’s campaign can be summarized by this: for every 10 things he says, only one or two are right. These comments in the embedded video below are spot on. Sanders is a “maniac” and a “communist” and his policies would be worse than Hillary Clinton and Trump’s!
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