Financial FAQs
“When I took office, inflation was the worst in 48 years, and some would say in the history of our country. President Donald Trump
No, just a cursory look at the St. Louis Fed’s above graph of the Consumer Price Index dating from 1970 shows that 48 years ago the Arab oil embargo of the 1970s spawned the mother of all stagflations sending consumer inflation to 14 percent in 1980.
The Trump administration is crowing about the weaker November inflation numbers cited in the BLS graph, but who will believe the data when he fired the head of the Bureau of Labor Statistics (BLS) that produces the report because he didn’t like the unemployment revisions in September?
Certainly not consumers, as their sentiment index via the University of Washington sentiment survey has fallen steadily from its high of 74.0 last December to 52.9 this December.
The belief problem was most evident in Trump’s recent prime time, 20-minute Oval Office address quoted above, that showed the leader of our government no longer has any grasp on reality, only his lies and fantasies.
Whereas the Biden administration had brought it down to 3.0% last December. It only began to rise again since Trump’s April 2 retaliatory tariff announcements.
Perhaps Trump’s biggest lie was that “Much of this success has been accomplished by tariffs. My favorite word tariffs, which for many decades have been used successfully by other countries against us, but not anymore.” and that the tariffs are bringing “billions” back to the American economy.
No, tariffs are an import duty taking money out of the pockets of Americans from the higher prices that have resulted. Though, they could be refunded to the importers that paid the duties if most of the tariffs are repealed by the Supreme Court, as expected. But don’t count on prices coming down anytime soon that have become imbedded since then.
The inflation report was deceptive in that though the overall inflation rate fell to 2.7 percent from 3.0 percent most components rose over the year.
“In November, the Consumer Price Index for All Urban Consumers rose 2.7 percent over the last 12 months, not seasonally adjusted. The index for all items less food and energy increased 2.6 percent over the year (NSA).” BLS
The index for all items less food and energy rose 2.6 percent over the past 12 months. The shelter index increased 3.0 percent over the last year. Other indexes with notable increases over the last year include medical care (+2.9 percent), household furnishings and operations (+4.6 percent), recreation (+1.8 percent), and used cars and trucks (+3.6 percent).
The most harm to American pocketbooks will be skyrocketing energy prices as the massive build out of AI centers will need tremendous amounts of power. That’s why the energy index for electricity increased 6.9 percent over the last 12 months and the index for natural gas rose 9.1 percent.
Maybe the saddest part of Trump’s address was his nonsensical, desperate hyperbole: “We're doing what nobody thought was even possible, not even remotely possible. There has never, frankly, been anything like it. One year ago, our country was dead. We were absolutely dead.
Yet the U.S. had the fastest economic recovery in the developed world from the COVID-19 pandemic under Joe Biden with full employment and GDP growth in the 2-3 percent range.
No, we are not dead. And recent political surveys are showing that American voters in recent elections are waking up to the damage being done by Trump and his oligarchs to the many Americans in just one year who have lost jobs, and healthcare coverage, and protection from the worsening floods, wildfires, and hurricanes that Trump calls “a hoax”, all in the name of enriching themselves.
Harlan Green © 2025
Follow Harlan Green on Twitter: https://twitter.com/HarlanGreen
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