The Federal Reserve is mandated to control inflation and using a computer program that is hopelessly out of context with the current economic conditions, they raised their rate a half a percent.

            The program doesn’t account for the supply disruptions causing shortages. The disruptions are causing containers and their ships to triple their cost. The price of petroleum increased almost double in year-over-year due to increased demand and supply shortages caused by sanctions on Putin. Food price increases are caused by Putin’s war, climate and fuel costs, and increased driver wages.

            The shortages of computer chips means new cars – if chips are available – may cost more than manufacturers suggested price. Used cars cost more because of fewer trade-ins. Rental prices for shelter (Fed term) are higher because more people are needing a place to live and fewer houses and apartments are being built causing rent and house prices to increase.

            With the price of petroleum up, gasoline is much higher. Because we are sending natural gas made into LPG (frozen and compressed natural gas) to Europe, the price has almost tripled year-over-year. Since 40% of our electricity is generated by burning natural gas, electricity prices are increasing proportionally.

            These items, along with a few others, are what the Fed uses in deciding what the inflation rate is and how to reduce it with interest rate increases. None of the above is something the Fed can control with any method so they are powerless to reduce the rate of inflation. They may interfere with the on-shoring manufacturing which in itself raises prices. Not doing so keeps us subservient to our enemies and prolongs supply disruptions.