August 31

8/31 – WEEKLY COMMODITY SUMMARY:

• Two stats released last week should give business planners reason for pause. The first was the Fed’s preferred inflation gauge, Personal Consumption Expenditures (PCE), which was 3.7% for July – far exceeding the 2% inflation target. Secondly, the U.S. federal debt level hit $40 trillion – up a staggering 73.9% from $23T in 2019.

• Exorbitant prices for things like war, ICE, and tax cuts have added to the previous administration’s blind spending on the pandemic and social programs. Throw in an aging U.S. population – pumping up costs for Medicare and Social Security – and the federal budget looks like a runaway train.

• The two things most likely to take the starch out of the U.S. economy in 2027 are fuel prices – a direct result of the Iran war - and borrowing costs that are trending higher as rising U.S. debt levels raise risk levels. Blame it on 25 years of ineffective and fiscally irresponsible post-9/11 political leadership.