It's deja vu - all over again...

"So where does that leave us? For many, shivering in the cold this winter. Why? It was reported on the business news that natural gas is up 30% from last year, and is expected to go higher this winter. But it is only inflation, and the President said this is no big deal. Just party on, dude!" 

IRA, which we know know in 2022 stands more for the Inflation Reduction Act, than it does Individual Retirement Account, or the Irish Republican Army, has a familiar ring to it. In other words, many of us old timers have seen this movie before. Like in 1974. Only then, beating inflation was a slogan, instead of a big, bulky bill. Back then, beating inflation was a movement. But it was a bust. But it had a cute title. It was called Whip Inflation Now, or WIN. Sound silly? Bingo!

Back in 1974, then President Gerald Ford told Americans to "save more, and spend less". He should have given that same speech to Congress. Now, I will not blame 100% of today's inflation on Congress - I am sure the pandemic, and its aftermath, had some to do with it. But I will give the lion's share of the blame to Congress. And right now, they are doubling down on the mess they have created.

Yesterday, there was a huge gala planned on the WH lawn. Every DNC staffer in WDC was invited. The image desired, was to have cheering throngs fawn all over the President, when he told the nation his IRA law was now working. We were beating inflation, just as the title of the bill had said. One very small problem however. 

Here is what happened. Earlier in the day, the CPI came out for August. Instead of another favorable move like there was the previous month, inflation went up by .1%, for an annualized rate of 8.6%. What really shocked the analysts about this move, was gas prices continue to come down. That means other items in the mix were still burning hot with inflation. Thus, the market tanked over 1000 points in response to that news. But who cares? Why let facts get in the way of a good WH party. So the festivities went on.

The only way to WIN or IRA is the one economists have told us since Econ 101. Somehow Congress never learns this most basic lesson. Inflation is too much money chasing too few goods. Passing all kinds of spending bills with money we don't have - is inflationary. Period.

So where does that leave us? For many, shivering in the cold this winter. Why? It was reported on the business news that natural gas is up 30% from last year, and is expected to go higher this winter. But it is only inflation, and the President said this is no big deal. Just party on, dude!