Breitbart Business Digest

October 29, 2021

Today's Top Stories From the Breitbart News Desk

The true scale of our inflation problem became a bit clearer on Friday. The Department of Labor released its Employer Cost Index, a broad measure of wages and benefits. It showed that compensation rose at the fastest pace in decades in the third quarter of this year. Wages and salaries increased 1.3 percent in the three-month period and were up 4.6 percent compared with a year ago.

The trouble is that prices are up even more. Compared with a year ago, the Consumer Price Index is up 5.4 percent. An alternative measure that looks only at prices paid by wage earners and clerical workers, sometimes called the "blue-collar" inflation gauge, was up by 5.9 percent. So despite record-breaking wage gains, workers are earning less than they were a year ago after adjusting for inflation.

No surprise, then, that the University of Michigan's Consumer Sentiment Index slumped again in October. The survey's long-running chief economist, Richard Curtin, warned in his commentary Friday that consumers have now decided that we've entered an inflationary era. That will make them more willing to pay, and encourage businesses to keep raising prices. This risks setting off an inflationary spiral. Curtin pointed out that the last time this happened, it took Paul Volcker's massive monetary tightening to break it.

The October survey also showed that the index tracking whether now is a bad time to buy a car rose to a score of 69. The bad time to buy household durables index rose to 54, close to its record high of 58. Of course, this might not only be due to inflation. Cars and appliances are scarce in many areas because of the broken supply chains. Not exactly a great lead into the holiday season.

– Alex Marlow & John Carney
Breitbart News Network

TOP STORY

Labor Costs Rise at Record Pace But Workers Still Lose Out To Inflation

The cost of employing the average U.S. worker increased at the fastest pace on record in the third quarter, data from the Labor Department showed Friday. But workers are still losing out to inflation on an annual basis. The employment cost index jumped 1.3 percent from the prior quarter, according to Labor Department data released Friday. The gauge increased 3.7 percent from a year earlier. Wages and salaries, which make up 70 percent of overall compensation, increased 4.2 percent for the 12-month period ending in September 2021, a big acceleration from the 12-month period ending a year ago. Compared with the second quarter, wages were up 1.3 percent. The cost of benefits rose 2.5 percent compared with 12 months ago, and 0.9 percent compared with the second quarter. [Click here for more]

IN OTHER STORIES...

Amazon Reports Drop in Profits, Expects Holidays Woes

Amazon recently reported a surprising drop in profits in the third quarter that it expects to continue through the holiday quarter. Reuters reports that Amazon reported a surprising drop in profits on Thursday that it believes will continue through the holiday quarter. Amazon reportedly plans to introduce higher pay to attract workers and predicts that other operational disruptions will diminish the company’s profits from... [Click here for more]

Nolte: 57% Say Economy Worse Under Biden, 60% Blame Democrats

A clear majority of Americans say the economy has worsened under His Fraudulency Joe Biden, and 60 percent put the blame squarely on Democrats. Rasmussen Reports asked 1,000 likely voters, “Has the U.S. economy gotten better or worse since Joe Biden became president, or is the economy about... [Click here for more]

Consumer Sentiment Drops and Raises Risk of Runaway Inflation

The reactions of American consumers to recent inflation raise the risk of escalating inflation in the year ahead, according to the chief economist of the University of Michigan’s survey of consumer sentiment. “The declining resistance to price hikes among buyers will be joined by less resistance among sellers to hiking prices that will be justified by higher materials and labor costs. These reactions promote an accelerating inflation rate until a tipping point is reached when consumers’ incomes can no longer keep pace with escalating... [Click here for more]

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