The latest consumer price inflation numbers came out.  The CPI was up 0.6% in April and now stands at 3.8% year-over year.  This is the highest it’s been since May 2023.

Before anyone quickly blames the higher price of oil, the CPI less food and energy came in at 0.4% for the month and 2.8% year-over-year.

So, even if you ignore the price of oil from the disastrous war in Iran, consumer price inflation is still running somewhat hot and is above the Fed’s supposed target of 2%.

This isn’t looking good for the Fed.  As I’ve explained in other posts, the price of oil alone shouldn’t drive consumer price inflation higher over a sustained period of time.  With consumers spending more on energy and gasoline, they will be forced to cut back elsewhere.

This could put deflationary pressure on other goods and services, but this is assuming all else remains equal.  The money supply rarely stays the same.

Real Wages

Along with the CPI report came news that the real average hourly wages for workers fell by 0.5% for the month.  Real wages are now down 0.3% on an annual basis.

How’s that for America First?  How’s that for Making America Great Again?

The average American is slightly poorer than one year ago.  And that is going by the government’s own data.

The military-industrial complex has gotten richer with the war in Iran and bombings and conflicts elsewhere. Some of the U.S. energy companies might be benefitting from the higher price of oil.

There are many people who are benefitting from foreign conflicts, higher oil prices, and even higher inflation.  The American people in general?  Not so much.

The average American is struggling while Trump and his war buddies are insisting that bombing Iran was really necessary because they were going to get a nuclear weapon by next weekend.

MAGA Approval

You have to give some credit to those who are still faithfully backing Donald Trump at this point.  They are not afraid to be completely humiliated and look foolish.  They just keep insisting that it is all part of a grand plan to make America great.  Trump is playing 10-D chess at this point, and nobody can understand it.

I’m not sure it would have been possible for someone to have mapped out a worse plan for Trump at the beginning of his second term.

I can just imagine one of his advisors: “Here’s the plan.  We’re going to bomb at least 7 countries in your first year back in office.  We are going to drastically increase spending and the debt even though DOGE will have identified a whole bunch of waste and corruption.  We are going to raise and lower tariffs almost every day and keep the whole business world guessing.  We are going to arrest legal immigrants who are critical of Israel.  And we are going to provoke Iran into destroying our military bases in the Middle East and have Iran control the Strait of Hormuz, even as you threaten to wipe out their whole civilization.  Sound like a plan?”

Maybe Trump will set a record for the lowest approval rating for any president in history.

When his war buddies finally decide to stab him in the back, Trump’s approval rating might get to 20%.  I don’t think the people who voted for him who no longer support him will be returning to his camp.

Trump has completely betrayed America First.  He completely lied any time he talked about bringing peace.  His whole presidency is a giant disaster.  And now we have falling real wages for American workers on top of it all.

The rot didn’t start with Trump, and it won’t end with Trump.  But he will rightly take some of the blame for our economic woes.  Even as we suffer the consequences, at least we can laugh at the downfall of his presidency.