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Bah Humbug! The 12 Days of a Joe Biden Christmas

The 12 days of Christmas have gotten more expensive in this economic recovery.

On the first day of Christmas, President Joe Biden gave to the American people a 39-year-high inflation rate. On the second day of Christmas, the Democrats gave to the taxpayers a deficit-financed budget that would add to the growing national debt. On the third day of Christmas, the Republicans gave to the nation very little opposition to the budget-busting Build Back Better agenda. Indeed, the holiday season is here, and it does not look like conservatives and libertarians will have themselves a merry little Christmas. Instead, the population will be traveling on an expensive sleigh ride gathering chestnuts because the cost of food and gasoline has skyrocketed this year. Bah humbug!

Will This Ever End?

GettyImages-1237212882 Joe Biden

Joe Biden (Photo by Drew Angerer/Getty Images)

Even with his approval rating on the decline, and the Democrats in panic mode over the 2022 midterm elections, the leaders in Washington are not plugging the holes in the sinking ship. The only change of direction might be abandoning the asinine “LatinX” term. But, for the grander scheme of things, the administration is full steam ahead on spending trillions of dollars the United States does not have.

Let’s consider Build Back Better. The Congressional Budget Office (CBO) recently published a report that warned if components of the president’s $1.75 trillion social-spending and climate-change plan were made permanent, it would add $3 trillion to the deficit. As legendary economist Milton Friedman would say, “There is nothing more permanent than a temporary government program.” Helen Keller stuck in a closet in a basement could see that the sunset clauses inside the legislation are nothing more than tools to mask the true cost of the bill.

For now, only about $200 billion will be added to the deficit, which will likely be monetized by the Federal Reserve System or made up in a myriad of different ways that – directly or indirectly – hurt low- and middle-income households’ budgets. This is something lawmakers never have to worry about: balancing a budget.

[memberzone align=”left”] Meanwhile, the global supply chain crisis, a wave of fiscal spending, monetary expansion, and a broad array of price pressures are weighing on consumers in the Biden economy. This has many anticipating that these conditions will remain the same over the next year. The Federal Reserve Board of New York’s (FRBNY) Survey of Consumer Expectations suggests that Americans think inflation will be around 6% over the next year. According to a monthly Bloomberg study, economists have also raised their inflation forecasts for the first three quarters of 2022.

The only way that any relief comes is in the form of monetary policy normalization. The U.S. central bank has started tapering its pandemic-era quantitative easing program, although the Eccles Building is still adding about another $200 billion to the balance sheet by the summer. It is also deliberating raising interest rates to curb inflation, but there is some skepticism that this would help due to the wide range of price pressures affecting the economy.

Still, some Wall Street titans, many of whom benefit immensely from a low-rate environment, think it would be prudent for the Fed to pull the trigger on a rate hike. Morgan Stanley CEO James Gorman told CNBC:

“We are heading toward a rising interest rate environment. I felt the Federal Reserve would be better off storing away some of the rate increases, so when the inevitable downturn comes, you’ve got some ammunition to fight with.

“If I were the Fed, I would start moving earlier rather than later. Store away some ammunition and accept the reality. I don’t think it derails the economy. This is what you need, you need balance in the economy.”

Either way, whether the Fed raises rates or not, consumers will be hurt. A rising-rate environment will affect indebted households since borrowing costs and debt-servicing payments would rise. The current economic conditions would make life more expensive. The American people will need a Miracle on 34th Street to survive the present state of affairs. Forget it, folks, it’s Biden town.

The 12 Days of Christmas

According to PNC Financial Services’ Christmas Price Index, the total cost of the 12 days of Christmas is 5.7% higher compared to 2019, coming in at slightly more than $41,200. A partridge in a pear tree is 6% more, two turtle doves surged 50%, and three French hens have spiked 40.5%. The only goods to remain flat were seven swans a’swimming, eight maids a’milking, and nine ladies dancing. Like the broader marketplace, everything else climbed from before the coronavirus pandemic. Of course, not everything is President Biden’s fault, but his policies have contributed to the excess cash flooding the economy, a reality to which he has admitted. It’s beginning to look like 1982, the last time inflation was this high for Christmas.

~ Read more from Andrew Moran.

Read More From Andrew Moran

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