President Trump’s claim to fame since being elected is that the economy is booming, people are earning more and unemployment is at its lowest levels in decades.
Well, the Labor Department just released a report on Friday being dubbed the ‘worst report in a decade’ that shows the cost of living in the U.S. rising at its fastest rate in 10 years.
The data shows specifically that consumer prices in the U.S. increased 2.9 percent since last July, meaning that on average, even though Americans might be seeing a bit more money in their paychecks, if you didn’t receive almost a 3% raise since last year, you’re earning less overall. The money you make won’t buy you as much.
Truth be told: In fact, despite some ups and downs over the past several decades, today’s real average wage (that is, the wage after accounting for inflation) has about the same purchasing power it did 40 years ago, reports Pew Research.
CNBC reported about the rising Consumer Price Index earlier in the day and noted that it rose .2 percent last month, and not only that, but the trend was strengthening. That means, it could get worse.
They noted that more price increases are expected to come about, in part, due to Trump’s tariffs which will cause manufacturers to pay more on lumber, aluminum, and steel imports.
Everyone remembers the Jimmy Carter years. Hyper-inflation ended up contributing to the end of his presidency. No one is suggesting that’s what’s even close to going on here, but this newly found data will put even more pressure on the fed to increase interest rates, which will thereby mean the party will soon be coming to an end. Borrowing will have higher costs, and every decimal point change will have a domino effect on the overall economy.
Expect this to put a damper on President Trump’s re-election prospects. The stock market can change on a whim and things aren’t humming along as nicely as people in the Trump administration would like you to believe.