The ShadowStats-Alternate Consumer Inflation Measures were created by reverse-engineering the CPI-U-RS series, and adding in estimates of the inflation effects of factors not otherwise estimated by the BLS, such as more-frequent (two-years versus ten-years) reweighting of the CPI series. Where current inflationary pressures appear to be tied to excessive Monetary stimulus out of the Fed, not due to an overheating economy, still higher interest rates, now, would do little to contain inflation, while at the same time higher interest rates would continue to impair economic activity. Part I --BOTTOM LINE Systemically Dangerous and Perilous FOMC Activity is Likely in the Week Ahead. Minimizing Reporting of Such, the Fed Just Redefined Money Supply M1; Given Newly Defined M1-Like Liquidity Characteristics for M2 Savings Deposits, Savings Have Been Shifted Retroactively from M2 to into M1, Effective as of May 2020 (8) April 18th, (Census Bureau). In the past, there have been various estimates of the economic impact and the size of shadow economy in Australia by organisations such as the Black Economy Taskforce External Link and the Australian Bureau of Statistics (ABS). That said, in Business Cycle definitions, an economic downturn traditionally has been known as a Depression, which has two components the Recession and the Recovery. After the economic terror of the Great Depression, economic downturns took on the less-frightening Recession nomenclature. SHADOWSTATS DAILY UPDATE - May 1st to May 3rd A major Subscriber-Only e-mail update is pending for later today. Apparently, neither has the Bureau of Labor Statistics, as detailed in an article by BLS economists John Greenlees and . January 2021 Annual Growth in Money Supply M1 and M2 Surged to Respective Record Highs of 69.7% and 25.8%, Despite Some Downside Benchmark Revisions That also was in context of a deepening shortfall against its Pre-Pandemic Peak by 1.46% (-1.46%) in 1q2023, versus a 1.22% (-1.22%) shortfall in 4q2022. In support of these goals, the Committee decided to raise the target range for the federal funds rate to 4-3/4 to 5 percent. Using the same data collection and calculation methodologies as the Bureau of Labor Statistics used in the 1980s, John Williams, the founder of ShadowStats, determined that headline inflation should be much higher than 5.4%, the latest June release. That began a lengthy process of exploring the history and nature of economic reporting and in interviewing key people involved in the process from the early days of government reporting through the present. The Committee remains highly attentive to inflation risks. The initial headline annualized quarterly estimate of inflation-adjusted First-Quarter 2023 Real Gross Domestic Product (GDP) showed doubly negative patterns of activity. Deepening Deficits in Fourth-Quarter and Annual 2020 Real Net-Exports (GDP) and the Related Real Merchandise Trade Deficit Were the Worst Ever in Modern U.S. [Posted May 1st, 1:00 a.m. For those looking to subscribe, please go to the SUBSCRIPTION LINK at the upper left-hand corner of this Web page). Shadowstats.comis a website that analyzes and offers alternatives to government economic statistics for the United States. (II) - REGULAR ALERTS Again, as noted after the February 2023 rate hike, despite Fed Chairman Jerome Powells continued downplaying risks for the FOMCs hoped-for imminent Recession, which otherwise ostensibly is why he was raising rates, that downturn already was and is in play. Severely Negative Annual Revisions to Industrial Production Mean the Economy Was in Recession Well Before the Pandemic Hit Collapsed Oil Prices Still Suppressed November CPI and PPI Annual Inflation; Yet, Oil Prices Suddenly Are Surging Anew (12) April 13th (Bureau of Labor Statistics). PLEASE NOTE: In 10 days (March 24th), this Retail Sales Series will undergo an annual benchmark revision. Chairman Powell backed off talk of mandatory, continuing FOMC Rate Hikes to kill Inflation, by killing the economy with high Interest Rates, noting that perhaps the Banking Crisis might slow the economy, and help to contain inflation. January 2021 Producer Price Index Monthly Inflation Hit a Record, 10-Year High CPI Data Series (Subscription required.) Measured against its Pre-Pandemic level, 4q2022 Real GDP had gained 5.03% [previously 5.06% and 5.11%]. (17) March 30th (Bureau of Economic Analysis BEA, See Note 2) -- Third and Final Estimate of Fourth Quarter 2022 (4q2022) Gross Domestic Product (GDP) [The GDP Alternate Data Tab has been updated] - In continuing downside revision, the third-estimate of inflation-adjusted real 4q2022 GDP revised lower to an annualized quarter-to-quarter gain of 2.57%, in its third and final estimate, from its second estimate of 2.68%, and its initial estimate of 2.89%, versus 3.24% in 3q2022. The Fed will release the headline April 2023 Money Supply and Monetary Base data at 1:00 p.m. That revised February inflation of 16.1% was much higher than the year-to-year nominal growth of 5.3% in parallel February Construction Spending, resulting in an unrevised, inflation adjusted, real year-to-year decline of 9.5% (-9.5%) in February 2023 [See extended comments in later Note (16)]. Risk of Hyperinflationary Economic Collapse Has Accelerated With Democrats Taking Control of Both the White House and Congress 1461. -- The Feds Balance Sheet Reduction formally began in June 2022 and should have begun to relieve some Money Supply pressures on Inflation at that time, in theory. Nov 26, 2013 Housing Starts delayed again. Again, with the recovery from the Pandemic-driven collapse still flub-a-dubbing, continued extraordinary Monetary and Fiscal Stimulus likely will continue well into 2023, despite Financial-Market huffing and puffing to the contrary, and bi-furcated FOMC happy hype. That said, more commonly, sharp annual declines in recent months have tended to be statistically significant, but not the month-to-month changes. Discussions on the inflation threat and re-accelerating money growth are found in Special Hyperinflation Commentary, Issue No. Including Long-Term Discouraged Workers, the broader, March 2023 ShadowStats Alternate Unemployment Rate of 24.6% held at a seven-month high. Under current policy and based on this reports assumptions, it is projected to reach 701 percent by 2096. Over the decades, well in excess of 1,000 presentations have been given on the economic outlook, or on approaches to analyzing economic data, to, clientslarge and smallincluding talks with members of the business, banking, government, press, academic, brokerage and investment communities. For those looking to subscribe, please go to the SUBSCRIPTION LINK at the upper left-hand corner of this Web page). Recent developments are likely to result in tighter credit conditions for households and businesses and to weigh on economic activity, hiring and inflation. -- Noted regularly here, New Home Sales (likely the least-reliable, least-meaningful, least-significant and most heavily revised headline series published by the Census Bureau) continued to sink year-to-year. Revised year-to-year growth slowed to 0.88%, from 0.91% and an initial estimate of 0.96%, versus 1.94% in 3q2022. If you are a Subscriber and are not receiving, but would like to receive those e-mails, please send a note to johnwilliams@shadowstats.com along with the desired e-mail address. Indeed, setting up accelerating inflation or hyperinflation, current extreme Monetary and Fiscal stimuli likely will be expanded, not reduced. The service costs $49.95 for a single month, $39.95 per month for a three-month subscription and $34.95 per month for a 12-month subscription. New Numbers Show Production Peaked in August 2018 and Entered Protracted Decline, February 2020 Pre-Pandemic Peak Was 1.11% (-1.11%) Below the Pre-Great Recession Peak S Y S T E M I C .. R I S K -- FEDERAL RESERVE -(April 25th) Coverage of the March 2023 Money Supply and March 2023 Monetary Base follows in the MONEY SUPPLY AND MONETARY BASE Section, subsequent to this FOMC Section. HEADLINE ECONOMIC, INFLATION AND MONETARY COVERAGE OF THE LAST MONTH AND OTHER KEY NUMBERS: (1) April 28th (University of Michigan). [See the earlier headline Payroll discussions and later FOMC comments.] Yet, as discussed here frequently, the problem inflation largely is being driven by the FOMCs still explosive Money Supply and System Liquidity growth, not by an overheating economy. Nonetheless, January 2021 CPI-U Annual Inflation Hit a Soft, Ten-Month High of 1.4%, Boosted by Gasoline Prices, but Constrained by Mixed Food and Core Inflation Reserves jumped by a dominant 7.1% in the month, which would speak to new money creation, while the Currency in Circulation component gained by 0.6% month-to-month, to a new historic high. Australia's Government Strengthens Grip With By-Election Win. The level of revenue passenger miles was their primary sales forecasting tool, and the model was heavily dependent on the GNP (now GDP) as reported by the Department of Commerce. ET) and Press Conference (2:30 p.m. That also was in context of a deepening shortfall against its Pre-Pandemic Peak by 1.46% (-1.46%) in 1q2023, versus a 1.22% (-1.22%) shortfall in 4q2022. -- Headline Fourth-Quarter 2022 GDP inflation (Implicit Price Deflator [IPD}) came in at a revised third estimate of an annualized pace of 3.92% (previously 3.93% and 3.51%), against an unrevised 4.36% in 3q2022, and up by an unrevised year-to-year 6.41% (initially 6.30%), versus an unrevised 7.15% in Third-Quarter 2022, which remained at a 42-year high, outside of the recent inflation spike. On Top of Downside Revisions, Declining November Real Retail Sales Showed Renewed Economic Deterioration March 7th builds: Power up the pink archer. For the month of February 2023, the real Deficit deepened to -l04.6 billion. Money Supply and Monetary Base detail follows in the later FEDERAL RESERVE Section and its SYSTEMIC RISK -- MONEY SUPPLY AND MONETARY BASE coverage (just keep scrolling down), along with expanded material in conjunction with the updated Money Supply numbers and graph posted on the ALTERNATE DATA Tab of www.shadowstats.com (see the link above). (14) April 7th (Bureau of Labor Statistics BLS, and ShadowStats.com). Gasoline prices having been in an upswing since January 2023, gaining 11.7% since December 2022, as of the just-released April 2023 monthly average [EIA]. To ensure that our results are as robust as possible we use multiple sources to estimate its overall size, including data from the ABS, the Black Economy Taskforce (BETF), and the Australian Criminal Intelligence Commission (ACIC). Those details are posted and graphed on the Alternate Data Tab. A Review-Preview of 2020 into 2024, it will incorporate all the latest economic details. The response to those writings (the Primer Series available at the top-center of this page) was so strong that we started ShadowStats.com (Shadow Government Statistics) in 2004. The CPI-U (consumer price index) is the broadest measure of consumer price inflation for goods and services published by the Bureau of Labor Statistics (BLS). Trailblazer builds: Strengthen your main character up. March 2023 Real New Orders for Durable Goods -- For fourteen consecutive quarters, through First-Quarter 2023, Real New Orders for Durable Goods (deflated by the Durable Goods PPI, and net of the volatile Commercial Aircraft orders), never has recovered its Third-Quarter 2019 Pre-Pandemic Peak activity. Noted frequently here and discussed subsequent to earlier FOMC Meetings (March 22nd was the last), little has changed: The Federal Reserves Federal Open Market Committee (FOMC) hiked the targeted Federal Funds Rate March 22nd by the expected 0.25%, to a 15-year high level of 5.00%, hoping still to induce an imminent Economic Recession, which otherwise already had been in play and deepening for some time, due to earlier rate hikes. Federal Reserve Chairman Powell: "We Are a Long Way from Full Recovery" At the same time, the Pandemic-distorted and disrupted year-to-year gain for February 2023 Basic M1 eased to 4.8% from and unrevised 6.2% in February 2023. Headline 1q2023 GDP annualized Real GDP growth of 1.06% slowed from an unrevised 2.57% in 4q2022, while annualized quarterly inflation picked from 3.92% to 4.01%. FOMC action looms this week, amidst signs of a tanking Economy and a serious Inflation problem. COVID-19 vaccines and improved treatment have helped to stabilize a still-disrupted level of economic activity, again well shy of a fundamental, full recovery, yet Pandemic issues, including new variants and vaccination controversies, continue. Understate inflation and you end up overstating the Real or inflation-adjusted level of growth in GDP. Consider -- Despite significant Recovery off the Pandemic-Driven Economic Trough of April 2020, the February 2023 Payroll Employment has recovered its February 2020 Pre-Pandemic/ Recession Peak, despite indications of a renewed slowdown. -- Headline March 2023 U.3 and U.6 Unemployment of 3.50% and 6.68% notched lower from respective three- and six-month highs of 3.57% and 6.80% in February, but held above January 2023 levels. Near Record Growth of Currency in Circulation Foreshadows Inflation Risk Given mounting U.S. Banking System instabilities, the Federal Reserve continues to spike systemic liquidity with inflation-driving Money Supply creation, which exacerbates the inflation problem. India's Jobless Rate Hits a Three-Month High of 7.8%, CMIE Says. HEADLINE ECONOMIC, INFLATION AND MONETARY COVERAGE OF THE LAST MONTH AND OTHER KEY NUMBERS: (1) April 28th (University of Michigan). The headline March 2023 Monetary Base, jumped by 4.7% month-to-month to a seven-month high, as the FOMC fed emergency funding into Reserve Balances with Federal Reserve Banks, at a time of systemic liquidity concerns. 1460b and will be detailed in pending No. The projected continuous rise of the debt-to-GDP ratio indicates that current policy is unsustainable. Allowing for the 2021 Unfunded Liabilities, reflected here, that Debt-to-GDP ratio already was 552% at the end of Fiscal Year 2021. Full-Year 2020 Existing- and New-Home Sales Were Highest Since 2006 Headline March 2023 Producer Price Index (PPI) annual inflation dropped sharply from 4.9% in February 2023 to 2.8% in March 2023, due to the relative easing against the extreme oil and gasoline price spikes triggered by the year-ago Russian invasion of Ukraine. The dotted lines are the overlayed series created from the official CPI statistics. That circumstance is reviewed in pending ShadowStats Benchmark Commentary No. Shadowstats primarily focuses on inflation, but also keeps track of the money supply, unemploymentand GDPby utilizing methodologies abandoned by previous administrations from the Clinton era to the Great Depression. Against Pre-Pandemic levels, Currency moved from a gain of 27.9% in February to 38.7% in March 2023, with parallel increases from 83.4% to 96.6% for Reserves, and from 54.11% to 61.3% in aggregate Monetary Base. John Williams, founder of ShadowStats, calculates inflation using the same methodology that the government used to have for calculating the consumer price index (CPI). The original Money Supply measure, Basic M-1 is defined as Currency plus Demand Deposits (checking accounts). Ukraine Latest: War Casts Shadow Over Votes in Bulgaria, Finland. Voting for the monetary policy action were Jerome H. Powell, Chair; John C. Williams, Vice Chair; Michael S. Barr; Michelle W. Bowman; Lisa D. Cook; Austan D. Goolsbee; Patrick Harker; Philip N. Jefferson; Neel Kashkari; Lorie K. Logan; and Christopher J. Waller.. April 2023 Annual Benchmark Revisions lowered historical levels and growth estimates for inflation-adjusted Real Retail Sales back to January 2021, likely foreshadowing some downside revisions to headline GDP in its later 2023 benchmarking. Republishing our charts: Permission, Restrictions and Instructions (includes important requirements for successful hot-linking) Narrowing Annual Declines in October and November Payrolls Stalled at 6.0% (-6.0%), But the Year-to-Year Drop in December 2020 Payrolls Deepened to 6.2% (-6.2%) April 2023 Annual Benchmark Revisions lowered historical levels and growth estimates for inflation-adjusted Real Retail Sales back to January 2021, likely foreshadowing some downside revisions to headline GDP in its later 2023 benchmarking. The extent of these effects is uncertain. In terms of quarter-to-quarter change, despite a sharp monthly decline in March 2023, those January and February auto sales pulled relative real 1q2023 activity up at an annualized quarterly pace of 3.10%, following respective consecutive annualized quarter-to-quarter declines of 3.29% (-3.29%) and 2.35% (-2.36%) in 4q2022 and 3q2022. By its very nature, the shadow economy is difficult to measure. In the charts to the right we show two SGS-Alternate CPI estimates: One based on the pre-1990 official methodology for computing the CPI-U, and the other based on the methodology which was employed prior to 1980. [April 9th]. That said, again, Fiscal Years 2021 and 2022 (FY 2021, FY 2022, FY 2023) circumstances and prospects have continued to deteriorate meaningfully, at an accelerating pace, from conditions at the end of FY 2020 (see the next paragraph), exploding anew into the still unfolding, disastrous FY 2023. -- In contrast, the ShadowStats Corrected Alternate-GDP estimate, adjusted for the continual understatement of headline GDP Inflation, and the corresponding continual overstatement of growth in the Real GDP, showed a corrected 1q2023 real annualized quarterly contraction of 0.98% (-0.98%), against a 0.50% 4q2022 gain, with an annual contraction of 0.49% (-0.49%) in 1q2023, against an annual drop of 1.16% (-1.16%) in 4q2022. The U.S. Dollar Is at Its Lowest Level Against the Swiss Franc Since January 2015, Down by 10.0% (-10.0%) Year-to-Year A Weak Dollar Is Highly Inflationary for the United States and Bullish for Gold (7) April 20th (National Association of Realtors NAR). (10) April 14th (Census Bureau, Bureau of Labor Statistics, St. Louis Fed, ShadowStats) [See the Opening Comments on the April 24th annual benchmark revisions to Retail Sales, which continue to show flat to negative annual contractions and quarterly contractions, net of inflation.] Underlying Economic and Labor Numbers through November Indicate Contracting or Flattening Fourth-Quarter 2020 GDP, Well Shy of Economic Recovery Redefined November Money Supply M1 Just Jumped from 31.7% to 92.7% of Total M2; November 2020 Year-to-Year Growth in the Traditional Money Supply M1 Soared to a Record 53.2%, the Redefined New Series Reflects a Record 348.4% Jump (5) April 25th (Census Bureau). -- In contrast, the ShadowStats Inflation-Corrected GDP Estimate (updated and graphed in full detail on the ALTERNATE DATA Tab) is corrected for the understatement of the headline inflation used in deflating Nominal GDP to Real GDP. In determining the extent of future increases in the target range, the Committee will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments. The annual drop of 22.0% (-22.0%) in March was against a 23.1% (-23.1%) annual decline in February, and was the eighth straight month of annual contraction deeper than minus 20% (go to https://www.nar.realtor/existing-home-sales for details). "John" Williams was born in 1949. Year-to-year Core PPI Inflation (net of Food and Energy) eased from 5.1% to 4.3%.
Service Employees International Union And Timberline Products,
Cypress Bay High School Bell Schedule,
From The Depth Of My Heart Quotes,
Percy Jackson Fanfiction Pertemis,
Radio Scotland Schedule Changes,
Articles S