News 

STANLEY DRUCKENMILLER: It’s time to give real capitalism a chance

“For years now a mix of financial repression and central bank intervention has made long-term interest rates largely determined by government fiat” writes Simon Black for businessinsider.com. Now, the irony of this is over the last 700 years inflation has averaged barely over 1% and interest rates have averaged just under 6%.But there’s a link to the full speech at the bottom: Can we try capitalism?. But, after he was elected, I was at least hopeful that it would represent an inflection point in the trend away from capitalism. Source: businessinsider.com…

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News Regulators 

Trump criticizes Federal Reserve, breaking long-standing practice

“Despite nearly a decade of unusually low interest rates, and other extraordinary Fed action, inflation has remained tame” writes David Lynch for washingtonpost.com. Republicans have for years criticized the Fed for keeping interest rates too low, which they said would lead to runaway inflation.Trump’s desire to keep rates low is a major change in GOP thinking on the Fed.By adding fuel to an economy that already was at full employment, Trump has contributed to the situation he is criticizing. Source: washingtonpost.com Share This:

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GBP News 

GBP/USD: Political Uncertainty & Soft Inflation Could Push-Back BoE August Hike – MUFG

“The pound was hit by weak inflation that joined political uncertainty and other issues” writes Yohay’s Google Profile for forexcrunch.com. Understandably market participants are building in a higher risk premium into the pound to reflect heightened uncertainty, and the risk premium may need to rise further heading into the year ahead.The one reassuring development for the pound is that the numbers in parliament should still favor a softer Brexit when it comes to the crunch even if the votes this week do not back up our view,” MUFG adds. Source: forexcrunch.com…

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News 

UK inflation fails to rise in June, giving Bank of England pause for thought

“British inflation failed to rise as expected last month, potentially giving Bank of England policymakers pause for thought ahead of a widely expected interest rate hike next month” writes Stefan Wermuth for cnbc.com. The Office for National Statistics figures suggested rising pressure in the pipeline for consumer prices.Despite motor fuel prices rising to their highest since September 2014, annual consumer price inflation held steady in June at 2.4 percent. Source: cnbc.com Share This:

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Markets News 

Jerome Powell: Job market will be strong for ‘several years’

“The economy is in good shape for the near future, Federal Reserve Chairman Jerome Powell said Tuesday, testifying that “the job market will remain strong and inflation will stay near 2 percent over the next several years.”” reports washingtonexaminer.com. Powell reassured senators Tuesday that steady rate increases was the Fed’s preferred course of action, noting that tightening monetary policy too slowly could raise the risk of too-high inflation or financial market bubbles.The economy does face threats, Powell acknowledged, including from the possibility of a trade war.Powell provided that sunny forecast…

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News Regulators 

Fed’s Powell: ‘Several years’ of strong jobs, low inflation still ahead

“But “it is difficult to predict the ultimate outcome of current discussions over trade policy,” he said” writes Midwest Communications Inc for 95kqds.com. Still-low interest rates, a stable financial system, ongoing global growth and the boost from recent tax cuts and increased federal spending “continue to support the expansion” Powell said. Overall the risks to the economy were “roughly balanced,” with the “most likely path for the economy” one of continued job gains, moderate inflation, and steady growth.But the Fed’s preferred measure of inflation hit 2.3 percent in May, and…

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News 

Retirement fund managers have made a huge mistake assuming 7% is an average return because 600 million workers are about to disappear from the global economy

“Seven percent is an important number, because if your personal retirement savings get less than that annually over the long haul you will not have saved enough for retirement” writes Jim Edwards for businessinsider.com. This shift will increase inflation and lower asset returns from 7% annually to roughly 4%, he theorises.Older workers with generous “defined benefit” plans typically received 23% of their compensation as a contribution to their retirement plan.He believes that the average rate of return will be cut by an epic global shift in demographics that is going…

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News 

Trump’s trade war is a ‘darkening cloud on the horizon,’ and Americans are starting to get worried

“But Trump’s trade policies produced a growing sense of unease among respondents” writes Bob Bryan for businessinsider.com. Those worried about the tariffs had two primary concerns, Curtin said: increased consumer prices and a possible economic slowdown.US consumers are starting to get nervous about President Donald Trump’s ever-expanding trade battles, according to the latest University of Michigan consumer confidence survey.”The primary concerns expressed by consumers were a decline in the future pace of economic growth and an uptick in inflation,” Curtin said. Source: businessinsider.com Share This:

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News Regulators 

Fed tells Congress the inflation pickup seen this year is not a surprise

“Some economists, including former Fed chairman Ben Bernanke, are worried the Trump tax cut will cause the economy to overheat, pushing up inflation and forcing the Fed to rapidly raise interest rates” writes Senior Economics Reporter for marketwatch.com. The Federal Reserve told Congress Friday that the rise in inflation witnessed since 2017 was expected and the central bank can continue to raise interest rates gradually. “Federal Reserve policymakers expected inflation to move higher in 2018.The Fed voted last month to raise interest rates for the second time this year to…

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News Oil 

Cost of imported goods sink in June, but the price drop won’t last once tariffs kick in

“The rate of import inflation over the past 12 months climbed to 5.3% in June, the fastest pace in almost seven years” writes Jeffry Bartash for marketwatch.com. Oil prices are likely to show an increase next month, but natural gas might not.Big picture: Inflation has shot up over the past year owing to rising oil prices, higher rents and more expensive medical care, among other things.What happened: The cost of imported oil and natural gas declined in June. Source: marketwatch.com Share This:

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