Independent Christian Voice

Wednesday

Like father, like son; inflation jump largest since Bush Sr.

The apple doesn't fall far from the tree. From the Associated Press:
WASHINGTON - Wholesale inflation jumped by the largest amount in 15 years in September and there are worrisome signs that soaring energy prices from the hurricanes are beginning to spill over to the rest of the economy. Prices at the wholesale level rose 1.9 percent, the biggest increase since the first Persian Gulf War in 1990. Like the 1.2 percent September jump in consumer prices announced last week, the biggest in 25 years, the surge was led by energy costs reflecting the widespread shutdowns of production following Hurricanes Katrina and Rita. But the report on wholesale prices raised more worries because it showed that outside of food and energy, price pressures were increasing. The so-called "core rate" of wholesale inflation rose by 0.3 percent last month after no change in August. …

The worry is that a sharp jump in energy prices will begin to put pressure on products outside of energy and cause the underlying rate of inflation to start rising. That could prompt the Federal Reserve to accelerate its interest rate increases in an effort to slow the economy as a way of keeping inflation from getting out of hand.

However, if tight global supplies keep energy prices at elevated levels, the inflation pressures might intensify even as the economy is slowing, pushing the country into "stagflation" — stagnant growth and rising inflation — something not experienced in America since the oil shocks of the 1970s and early 1980s. …

The 1.9 percent jump in wholesale prices matched a similar rise in January 1990 and has not been surpassed since a 2 percent increase in November 1974, another period of surging oil prices caused by the first Arab oil embargo.

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Republicanomics has "rescued" our economy from the perilous times of the Clinton years with its prosperity and record growth. To borrow from that great Republican icon Ronald Reagan, "ask yourself this question: are you better off now than you were five years ago?"

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