Biden’s so-called recovery plan was premised on reopening the country and handing out lots of money to everyone to spend.
That’s not a new idea in Washington D.C. where burning money is the norm. But then Biden decided to pull a ‘backsie’ and freedom was canceled. Meanwhile, the giant bonfire of money did result in more spending and even more inflation. Prices rose and the Democrats proposed to counter that by giving everyone even more money, so prices would rise even higher, so they could hand out more money.
While the road trip to Venezuela via Modern Monetary Theory continues, consumers are starting to pull out of the financial doom loop.
Shoppers in the U.S. cut back their purchases in July even more than expected as worries over the delta variant of Covid-19 dampened activity and government stimulus dried up.
Retail sales for the month fell 1.1%, worse than the Dow Jones estimate of a 0.3% decline and below the upwardly revised 0.7% increase in June.
Excluding automobiles, sales declined 0.4%, according to Commerce Department figures released Tuesday.
Considering the auto market situation, that’s not surprising. We saw this with home sales and then auto sales.
The auto sector has been a major contributor to the inflation surge in 2021, with used car prices jumping higher amid swelling demand.
You can only keep hiding the ball for so long.
A separate economic report Tuesday showed that industrial production rose 0.9%, ahead of the 0.5% Dow Jones estimate and due largely to an 11.3% burst in vehicle production.
Create an artificial shortage to boost demand, then pour money into the sector, raise prices, and hand out cash to everyone.
It’s not an economic solution and people are beginning to pull back.
Eating and drinking establishments saw a 38.4% increase in sales from a year ago.
Not for long if the lockdowns come back.