We are going to continue to have supply chain problems until we get diesel prices under control.That is a massive driver in terms of really affecting the ability to get foreign goods from the field to the processing plant.
Americans for Limited Government President Richard Manning joins host Michael Yaffee of WVNN radio in Huntsville, AL to discuss the latest inflation numbers and discuss the overall picture of the Biden economy.
Michael Yaffee: Federal Reserve Chairman Jerome Powell now admits that inflation is a problem. And they’re saying they’re probably gonna have to raise interest rates because of inflation. How is it that you and I saw this coming months and months ago and these people are just now seeing the problem?
Richard Manning: We have our own bias and what we blind ourselves to. When you have too many dollars chasing too few goods, you will have inflation. What the so-called experts didn’t anticipate was that you’d have an ongoing supply chain problem that is adversely affecting the supply side. What happens next is something called the wage price-spiral. That is where wages chase higher prices, and it’s a cycle that is really hard to break out of. Business people and factories have to raise prices to still make a profit. And you end up with a vicious cycle.
Michael Yaffee: How do we get out of this mess on your radar?
Richard Manning: The feds are going to have to raise interest rates. They’re trying to suck money up out of the economy and lower the demand for goods. But if the federal government continues running trillion dollar deficits as the norm, that’s going to be keeping the demand-side of the equation high. We really need to cut government spending and get back to basics.
Michael Yaffee: I want to remind people of the numbers real quick: the consumer price index 1.5 percent for the month of December, that puts yearly inflation at 7 percent. It’s the highest since mid 1982. It’s the seventh straight month that it topped 5 percent. Also used car prices are up thirty-seven percent, and of course, fuel gasoline prices 50 percent more in December.
Richard Manning: With those prices up in some cases as much as 50 percent, that’s a massive hit. We are going to continue to have supply chain problems until we get diesel prices under control.That is a massive driver in terms of really affecting the ability to get foreign goods from the field to the processing plant. A lot of truck drivers want to go and do the short haul because it calms the gas and diesel cars more cars were run their truck than they get paid for making the home. And that’s a huge problem with a lot of farm communities right now. So you’ve got a so we have to fix a diesel oil is a diesel class. And if we can fix the diesel cost and a lot of the other things will come together because it’s constant transportation that is driving a significant amount of the cost of consumer goods that you find at your stores.
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