Economy condition ‘terrible’ as inflation hits new 40-year high: investment expert

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Kingsview Wealth Management Chief Investment Officer Scott Martin argued Sunday that the state of the US economy is “terrible” as inflation has hit a new high in 40 years.

Martin, a FOX Business contributor, made the comment about “Fox News Live” in response to the latest Fox News poll, which revealed that nearly all voters are concerned about inflation and that large numbers continue to view the economy negatively, while a majority expect the situation to get worse next year.

Only 17% of respondents rated the economy positively, the lowest in nearly 10 years. Eighty-four percent said it is in fair or poor condition. And a 52% majority think it will be even worse next year. This is the first time in periodic surveys dating back to 1998 that more than half believe the economy will be worse in a year.

Meanwhile, 52% have changed their travel plans for the summer because of gas prices, 70% have had to cut other expenses to cover their necessities, and 75% say inflation has caused them financial hardship — a 67% increase in December.

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Many blame the White House for the economic woes. Fifty-five percent say the government has worsened the economy, and more voters blame Biden (31%) for gas prices than believe Russia (20%) or oil companies (14%) are responsible.

Martin predicted that “you will see the polls continue to fall as some economic data, inflation numbers continue to deteriorate.”

Martin made the comment four days after it was announced that inflation accelerated more than expected in June to a new four-decade high as the price of daily necessities remains painfully high, exacerbating financial pressures on millions of Americans.

The Labor Department said Wednesday that the consumer price index, a broad measure of the price of everyday goods, including gasoline, groceries and rent, rose 9.1% in June from a year ago. Prices rose by 1.3% in the one-month period from May. Those numbers were both much higher than the main figure of 8.8% and the monthly gain of 1% predicted by Refinitiv economists.

The data marked the highest inflation rate since December 1981.

The price increases have been substantial, suggesting that inflation may not be near its peak: energy prices rose 7.5% in June from the previous month and are 41.6% higher than last year. Petrol costs on average 59.9% more than a year ago and 11.2% more than in May. The food index rose 1% in June as consumers paid more for products such as breakfast cereals, chicken, milk and fresh vegetables.

The scorching hot inflation has put severe financial pressure on most American households, who are forced to pay for more daily necessities, such as food, gasoline and rent. The burden is disproportionately borne by low-income Americans, whose already stretched paychecks are heavily impacted by price fluctuations.

  The consumer price index, a broad measure of the price of everyday goods, including gasoline, groceries and rents, rose 9.1% in June from a year ago, the Labor Department said.

The consumer price index, a broad measure of the price of everyday goods, including gasoline, groceries and rents, rose 9.1% in June from a year ago, the Labor Department said.
(stock)

Martin described the economic situation on Sunday as “terrible”, “especially if you think about it at the consumer level, but also at the producer level.”

“Think of all the costs, as far as gasoline, diesel fuel needed to sell and deliver the goods if you are a business, so it affects everyone,” he emphasized.

It was also revealed last week that wholesale prices rose again in June as inflation seeped through all parts of the US economy, putting pressure on businesses and US households in the form of higher prices for most necessities.

The Labor Department said Thursday that the Producer Price Index (PPI), which measures inflation at the wholesale level before it reaches consumers, rose 11.3% in June from the previous year. On a monthly basis, prices rose by 1.1%.

Both figures are higher than Refinitiv economists’ 10.7% annual and 0.8% monthly estimates, underscoring how strong inflationary pressures remain.

Markets have experienced volatility in recent months amid the uncertain economic picture.

Martin advised that investors should definitely have a “diversified basket of stocks.”

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He also noted that “when we look at what probably has the best potential to rise from here, I think it’s growth stocks and stuff in technology.”

Megan Henney of FOX Business and Dana Blanton of Fox News contributed to this report.

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