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Biden Hits the Largest Inflation Increase Since 1981

Americans are experiencing “the largest 12 month increase since December of 1981.” According to the consumer price index for July 13, 2022, inflation has reached another record high of 9.1%.

Another change has occurred today in the exchange rate of dollars to euros. According to Bloomberg Markets, the exchange rate has dropped to $1.00 per euro as of July 13, 2022. The rate has been dropping significantly over the last year and today the currencies are equal. Exchange rates have remained at or above $1.10 for the majority of the last twenty years. The lower rate could be a silver lining for those seeking to travel to Europe or do business abroad.

The Labor Department provided the data on inflation rates for consumer’s typical needs:

Gas: 48.7%

Used cars and trucks: 16.1%

New vehicles: 12.6%

Electricity: 12%

Food at home: 11.9%

Food away from home: 7.4%

Shelter: 5.5%

Apparel: 5%

In the last year the price of gas has skyrocketed up 48.7%. There has been a 4.1% rise in just the last month. The current average cost for a single gallon of gas is $4.99, with the highest price on record in Mendocino, California charging nearly $10 per gallon. This is a stark contrast in comparison to the price of gas on the day of President Biden’s inauguration which was only $2.39 per gallon.

Though Japan has a lower inflation rate than the US, the country’s zoo animals are being affected by the rise in prices. Penguins and otters at the Hakone-en Aquarium were accustomed to a diet of horse mackerel. Due to the overall cost of running the aquarium increasing by 20% since the start of 2022, the zookeepers have opted for a cheaper diet consisting of fatty aji.

Zookeeper Hiroki Shimamoto commented on the penguin’s reaction to the change in an interview with Vice.

“Even if they’ll take it in their beaks, they’ll just spit it out,” Shimamoto said.

Zoo keepers feeding penguins are not the only ones driven to cheaper options to meet their daily needs. Survey of Consumers Director Joanna Hsu made a statement about the effects of inflation on American consumers.

“Consumers across income, age, education, geographic region, political affiliation, stockholding and homeownership status all posted large declines,” Hsu said. “As higher prices become harder to avoid, consumers may feel they have no choice but to adjust their spending patterns, whether through substitution of goods or foregoing purchases altogether. The speed and intensity at which these adjustments occur will be critical for the trajectory of the economy.”

The cost of sending mail through the United States Postal Service has also increased by 3.4%. After raising employee’s wages by 1.3%, the “Postal Service entered a $11.3 billion contract to replace its fleet primarily with gas-powered vehicles.” This contract is in accordance with President Biden’s Executive Order “telling all federal agencies to convert to ‘clean and zero-emission vehicles’ by 2035.”

The S&P 500 (which monitors the performance of 500 large public companies) fell more than 21% since January 1, 2022, marking the worst first six months of a year the stock market has seen in over the last fifty years.

In addition to losing money on investments, Americans have opted to dip into their savings to make ends meet. “Personal savings fell from nearly $4 trillion in the first quarter of 2021 to slightly over $1 trillion in the first quarter of 2022.”

Despite America’s economic state, President Biden sent another 1.7 billion dollars to aid Ukraine in its fight against Russia. The U.S. Agency for International Development (USAID) has sent nearly 4 billion dollars to Ukraine and “the U.S. government has sent more than $7 billion total since the war began in February, according to the Associated Press.” Biden seems to have no intention of stopping the funds. He discussed the funding in a press conference in June at NATO.

“We are going to support Ukraine as long as it takes,” Biden said.

“Meanwhile, the University of Michigan’s benchmark Survey of Consumers reached its lowest level since 1952,” The Daily Wire reported. “Nearly 70% of the United States’ economic output hinges upon consumer spending — meaning that a drop in consumer sentiment could signal a looming recession.”

According to The Federal Reserve Bank of Atlanta, the economy shrank at a 1.5% annualized pace in the first quarter of 2022 and a 2.1% pace in the second quarter. This data meets the definition of a recession, “two consecutive quarters of negative GDP growth.”

Although the satisfaction rate with the current economic state is low, White House Press Secretary Karine Jean-Pierre told reporters the economy is “strong.”

“When we look at where we are economically — and we are stronger economically than we have been in history,” Jean-Pierre said. “When you look at the unemployment numbers at 3.6%, when you look at the jobs numbers, more than 8.7 million of new jobs created, that is important.”

A study released by the U.S. Bureau of Labor Statistics challenges Jean-Pierre’s statement finding that the percentage of Americans concerned about losing their jobs within the next year has risen by 1.8% since May.

President Biden is also inaccurate in his statement regarding inflation,

“Under my plan for the economy, we’ve made extraordinary progress,” Biden said. “And we put America in a position to tackle the… worldwide problem that’s worse everywhere but here: inflation.”

In reality, data conducted in April shows inflation in South Korea was 4.8%, Japan was 2.5% and inflation in Germany and the United States was 7.4% and 8.3%, respectively. Since then, the United State's inflation rates have only continued to increase.

The U.S. Oil & Gas Association (USOGA) tweeted back at another Biden faux pas responding to his demand for gas stations to lower their prices.

“My message to the companies running gas stations and setting prices at the pump is simple: this is a time of war and global peril,” Biden tweeted. “Bring down the price you are charging at the pump to reflect the cost you’re paying for the product. And do it now.”

“Working on it Mr. President,” the USOGA responded. “In the meantime – have a Happy 4th and please make sure the WH intern who posted this tweet registers for Econ 101 for the fall semester…”

Owner of the Washington Post Jeff Bezos also tweeted against Biden’s ignorant request

“Ouch. Inflation is far too important a problem for the White House to keep making statements like this,” Bezos wrote. “It’s either straight ahead misdirection or a deep misunderstanding of basic market dynamics.”

Federal Reserve Chairman Jerome Powell briefly addressed how the U.S. can fix its inflation issue

“I would say that we fully understand and appreciate … the pain people are going through dealing with higher inflation, that we have the tools to address that and the resolve to use them, and that we are committed to and will succeed in getting inflation down to two percent,” Powell said.

“The process is likely, highly likely to involve some pain, but the worst pain would be from failing to address this high inflation and allowing it to become persistent,” Powell added.

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