Peter Schiff: When It Comes to Inflation, We’re Just Getting Started
The July Consumer Price Index (CPI) data came out this week. For the first time, the numbers were in line with expectations, leading many mainstream pundits to declare “transitory” inflation is already starting to cool down. Peter Schiff broke down the report in his podcast. He said inflation is far from cooling off. In fact, when it comes to rising prices, you haven’t seen anything yet.
July CPI rose 0.5% month-on-month. This was in line with expectations for the first time this year. Every other CPI report had come in hotter than expected.
The year-on-year CPI came in at 5.4% – a high number, but in line with expectations. Core CPI, stripping out more volatile food and energy, charted below estimates at 0.3%.
Adding up the monthly CPI increases gives us a 4.1% inflation rate through the first seven months of 2021. As Peter pointed out, that’s more than double the Fed’s target of “slightly above 2%,” and we’re barely over halfway through the year. If you annualized the first seven months, you get around 7.2% inflation for 2021.
Clearly, nobody can define that as ‘slightly above.’ It’s more than triple 2%. I mean, it’s getting close to quadruple.”
And as Peter points out, it would be a lot worse if we had an honest measure of price increases.
I think if we measured inflation today using the same CPI we used to measure inflation in the 1970s, this year could end up being a worse year than any single year during the 1970s.”
More disturbing, Peter said this is just the beginning.
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