As Mid-Term Election Near and Biden’s Stagflation Intensifies, Serious Investors Will Buy Gold by Jerome R. Corsi, Ph.D.
With the mid-term elections rapidly approaching, the dismal failure of the Biden administration is likely to weigh like an anchor on Democratic Party candidates up for re-election.
Even more worrisome, economic pundits who have successfully predicted previous economic downturns are predicting the global economy will crash after the U.S. midterm elections. NYU economics professor Nouriel Roubini, who became famous for predicting the 2008 housing collapse, is now expecting a global financial collapse before the end of 2020 that will be “long and ugly.”
With global stagflation intensifying in the United States and Europe, Nouriel foresees that the European energy crisis and the continuing Russian invasion of Ukraine will cause a significant financial institution to fail, sending economic shockwaves through the global economy. “I don’t believe central banks when they say ‘we’re going to fight inflation at any cost,’ because they have a delusion of either a soft landing or a hard landing that is short and shallow—two economic quarters of negative growth and then you return to growth and easing,” Roubini said . "That’s not going to happen."
The Biden administration can no longer deny that its fiscal spending policies and Green New Deal clamp down on U.S. oil and natural gas production, the U.S. economy is suffering. The government inflation numbers reported last month were once again disappointing.
* On October 14, 2022, the Bureau of Labor Statistics (BLS) reported that the Producer Price Index (PPI) increased 0.4 percent in September after falling 0.1 percent in August and 0.5 percent in July. The PPI advanced to an annual 8.5 percent rate in September. In September, gasoline prices started to take off again,
hitting $3.77 for the week of October 24, with more increases on the way. The 99-day streak of gasoline price declines from mid-June to September 20 is likely soon to be a distant memory. Gasoline prices, however, are down from the June record of $5.03 per gallon.
* The next day, on October 13, 2022, the U.S. Bureau of Labor Statistics (BLS) reported that the Consumer Price Index (CPI) rose 0.4 percent in September after rising 0.1 percent in August and remaining unchanged in July. This increase in August slightly slowed the annual inflation pace to 8.2 percent in September, twice the expected amount. The September CPI revealed a shocking 8.2 percent year-to-year inflation rate, the highest in 40 years.
In November, the Federal Reserve is ready to raise interest in the next two meetings in November and December, with the Fed expected to increaserates by 75 basis points for the fourth time in a row. The national debt has accelerated to $31.4 trillion, while the budget deficit is $1.4 trillion in the fiscal year 2022. The September employment data showed
lackluster job creation , with a decline of 3.5 percent, a decrease in job openings by almost 10 percent, and wage growth at approximately 5 percent, all lower than expected.
Since last year , grocery prices have skyrocketed by 30 percent, dairy-related products are up by 15.9 percent, bread is up by 14.7 percent, and butter by 26.6 percent. On October 16, 2022, the New York Post reported that since President Biden took office, monthly savings have collapsed, falling 83 percent. The Post article noted that since the start of 2022, 401(k) plans had suffered $2.1 trillion in losses. The average 401(k) plan had over $135,000 at the start of 2022, but today those plans have shrunk to about $101,000. This drop represents an average loss of $34,000, or 25 percent of the plan’s value at the start of the year.
A survey conducted by the Nationwide Retirement Institute in October showed nearly one in five Americans (18 percent) say they skipped meals or didn’t buy groceries due to high inflation (including 28% of Gen Z and 23 percent of millennials). The survey showed that over the last 12 months, nearly two in five American households (40 percent) received food or goods from a food bank (22 percent for Millennials, and the roughly same amount (17 percent) stopped buying healthier foods (organic or high-priced healthy foods). Grocery prices have climbed 13 percent from a year ago, rising 0.7 percent from August to September.
Just consider the following economic indicators, comparing the last day President Trump was in office, March 20, 2022, to the performance of President Biden at the end of October 2022. This quick survey of economic indicators makes clear the Biden administration’s economic policies have backfired.
Last Month of Trump Administration: March 20, 2022
The Month of Biden Mid-Term Election: November 2022
1.5% inflation rate
Inflation Rate (CPI)
8.2% inflation rate
$2.12for a gallon of regular gasoline
$3.77 for a gallon of regular gasoline
3.65% average 30-year mortgage rate
30-Year Mortgage Rate
7.08% average 30-year mortgage rate
$1,615/month median national rent expense
Average Rent Prices
$2,002/month median national rent expense
3.4% annual increase in CPI food index for 2020
Percent Change in CPI Food Index 2020 vs. 2022
Estimated 9.5% to 10.5% annual increase in CPI food index for 2020
CPI Average Price Data for Electricity Costs per Kilowatt Hour (KWH)
Increased 7.5% for the year ending April 2020
Real Median Household Income in the United States
Decreased by 2.8% from August 2021 to August 2022
2020 DJIA returned 6.7% in 2020. Including dividend reinvestment, the DJIA returned 9.7% in 2020
Dow Jones Industrial (DJIA) Gain or Loss
DJIA from 12/03/2022 (closing price 36,585) to 10/28/2022 (closing price 32,861) has lost 9.5%
Data that became available in October suggest the housing crash is intensifying. Home sales and listings in September both plunged over 20 percent in September, according to a report from the housing industry’s Redfin Economics Research. The number of homes sold in September fell 25 percent, while new listings decreased 22 percent in September—the most significant declines since May 2020 and April 2020, respectively, when the onset of the COVID-19 pandemic brought the housing market to a new halt.
Investors who see gold as a long-term hedge to preserve purchasing power in times are surging inflation see gold dropping to under $1,700/ounce as a buying opportunity. In the late-1970s stagflation caused by President Jimmy Carter’s mishandling of the OPEC energy crisis, gold surged from under $200/ounce in 1977, when Carter entered office, to over $650/ounce, when Fed Chair Paul Volker stabilized the economy by imposing double-digit interest rates.
In the recession of 2008, gold surged. After rising 2.6 percent in 2008, the Producer Price Index (PPI) for gold increased 12.8 percent as the Federal Reserve ramped up its initial round of quantitative easing. As the economy contracted in the 2008 recession and the Fed engaged in monetary easing, serious investors poured their money into gold to maintain their total asset value. In late August 2011, gold reached an all-time high of $1,917.90/ounce.
With Biden heading down Jimmy Carter’s path cutting U.S. oil and natural gas production when Russia has cut off natural gas to the EU, we are likely entering another severe bout of stagflation. Serious investors will realize the Biden administration has served up another historic opportunity to buy gold at prices today that in the future will look like a bargain.
Since 2004, Jerome R. Corsi has published 25 books on economics, history, and politics, including two #1 New York Times bestsellers. In 1972, he received his Ph.D. from the Department of Government at Harvard University. He currently resides in New Jersey with his family. His current book, The Truth About Energy, Global Warming, and Climate Change: Exposing Climate Lies in an Age of Disinformation , published on June 28, 2022, was listed by Amazon.com as a “Best Seller” in the first week of sales. Dr. Corsi’s new website, DrJeromeCorsi.com, will soon feature an economics section including his writings on gold and silver investing, a program he has been promoting with Swiss America for nearly 25 years.
Swiss America Gold and Silver Investing
For those who adhere to the investment adage, “Buy Low, Sell High,” the Biden administration appears to be serving up a rare opportunity to buy gold and silver when precious metal prices are down from previous year highs and positioned for an historic advance.
In a weird rush of déjà vu, we can easily imagine we have returned to the presidency of Jimmy Carter, experiencing once again the bizarre phenomenon of stagflation. Like what happened in the late 1970s, today’s economy is stalling while prices go through the roof. Finally, Federal Reserve chairman Jerome Powell has admitted that inflation today is not a temporary phenomenon caused by the economy starting up again.
Inflation in the United States has rapidly moved into double digits, close to the rarified high altitude of 14.8 percent that marked the top of the Carter era hyperinflation. In 1979, then-Fed Chair Paul Volcker placed a lid on the money supply, raising interest rates to a peak of 20 percent in June 1981 and driving inflation down from a high of 14.8 percent in March 1980 to 2.5 percent three years later. The pain of Volcker’s decisive moves was that the U.S. economy suffered two punishing recessions.
The Biden administration’s penchant under the “Inflation Reduction Act” to spend another trillion dollars in Modern Monetary Theory deficit spending suggests we are not yet at the height of this new, increasingly painful round of hyperinflation. To make matters worse, with the escalating costs of energy and food pounding the middle class, the United States has entered another recessionary period of stagnant economic growth.
I first began working with Craig R. Smith, the Chairman Emeritus of Swiss America Trading Corporation in 2005, when we co-authored Black Gold Stranglehold: The Myth of Scarcity and the Politics of Oil – a bestselling book that continues to sell briskly even today, nearly 20 years after Craig and I first met. On every website I have created since 2004, including this one, I have been honored to represent Swiss America. Since 1982, Swiss America has advised clients to diversify at least a small portion of their assets in U.S. gold and silver coins for these four reasons: (1.) Liquidity, (2) Safety, (3) Profit Potential, and (4) Privacy of Ownership … in that order.
The fundamentals for gold and silver investing have never looked better. As the Biden administration continues to spend trillions of dollars, the move is on in the United States – as well as internationally – to “de-dollarize,” a move that has once again enhanced the value of gold and silver as long-term investment assets capable of holding value. Precious metals also hedge against devaluations in national currencies and the faltering of cryptocurrencies amid an increasingly expected return globally to the stagflation of the late 1970s.
Precious metals increasingly viewed as a “safe-harbor” investment in these uncertain financial times. Walking Liberty Half Dollars are a very popular U.S. half-dollar coin, minted in 90% silver between 1926-1947. For a limited time, Swiss America is offering DrJeromeCorsi.com followers a special offer of Walking Liberty Half Dollars at a price of $12.50 each, including delivery. The Walking Liberty Half Dollar special offer is limited to 250 coins per customer. To learn more:
This year, savvy investors must be prepared for rough economic times, perhaps more treacherous than any financial turmoil we have experienced in recent past decades. The Biden stagflation may reach staggering double-digit levels as the Biden administration’s Green Energy Agenda threatens to restrain U.S. production of relatively inexpensive and amply available hydrocarbon fuels, including gasoline and natural gas. To make financial times even more uncertain, central governments worldwide, including the Federal Reserve in the United States, are preparing to introduce digital currencies aimed at creating cashless societies.
As a special offer, Swiss America is offering DrJeromeCorsi.com followers the opportunity to receive Two Swiss America Special Reports to help you prepare for what’s coming next. Real Money Perspectives explains in an easy-to-understand manner the threat to our purchasing power the Biden economic plan has created. The Secret War Against Cash warns that of the federal government’s plans to ban cash by imposing regulations prohibiting banks from allowing depositors to withdraw their dollars in cash.