Catching up on markets, inflation, Tesla and tariffs

The markets continue to falter. As prognosticated here in Money Matters many times over the past year or more, the inflation figure just out last week demonstrates what I have been saying: Inflation will not be solved and the markets will continue to suffer for it. Also no surprise is the FED's admission that it is "uncertain" about where inflation may go in the future. Sometimes, I wonder what the thousands of economists employed at the FED do all day. Perhaps the Department of Government Efficiency (DOGE) should start with some cuts there. Because of the massive COVID bailout monies strewn about to just about everyone and everywhere, unless Draconian cuts are made across all government spending fronts, rising prices will continue. Recall I also said the ongoing government outlays, even after the COVID monies, will continue to add fuel to the inflation that is ravaging the U.S. and indeed the entire civilized world. I also said the cuts by the current DOGE entity and whatever other agencies are scaling back won't make much of a dent in prices. To actually rein in not only the rate of rise of inflation but also have prices actually make the necessary fall we need to make things affordable again, the cuts needed will make the DOGE proposed cuts look like child's play. Put simply, there has been so much paper dollars printed up in the last couple of decades, the inflation is more than baked into the proverbial cake and the cuts needed to rein THAT in will never be tolerated. Gold hit another new record as investors seek refuge. Bitcoin, however, is still stuck in the mud, in the 80,000s, down from the $110,000 range just a few months back. Meanwhile, those seeking financial shelter in their local banks will find savings and CD rates now in the low fours, down from the rates of well over 5 percent half a year back or so. 30-year mortgage rates currently hover around 6.5 percent while the real estate market continues to flounder. In the "I hate to report this" column, the defacing and destruction of Tesla automobiles continues to make sad news. Victims of such vandalism inhabit both political party affiliations. I wonder if the lowlifes participating in such acts realize they may be damaging the property of those that feel the same way politically as they do. Democrats, Republicans and moderates own these cars. A 2023 Gallup survey found 6 percent of Democrats, 4 percent of independents and 1 percent of Republicans owned electric cars. It might be funny if it wasn't so tragic. What a sad commentary on the human behavior of some people. A 7.7-magnitude earthquake hit Myanmar near Thailand at 6:21 a.m. GMT on March 28. Massive damage resulted from the event with damage also in Bangkok, the capital of Thailand and the surrounding areas. The death toll is expected to rise into the thousands as rescue crews work to find survivors. On the economic front, the Trump tariffs, those implemented and threatened, continue to dampen investor enthusiasm. Some believe the president seems to be embarking on a longer-term plan for economic recovery, as he rarely mentions the stock market since being elected. During his first term, he repeatedly spoke about stock prices (more than 60 tweets in his first year in office), whereas this time around, he rarely mentions it. Critics quickly point to the continued erosion in stocks as evidence his plan is hurting more than helping. Proponents counter by saying give things time to work. This analyst has written many times that both tariffs and price controls, indeed any government intervention into a free market system, will only make things worse in the long run. Free markets need to be just that. Free to adhere to the basic economic premise and mechanism that, without government intervention, a truly free market will cleanse most ills that seemingly continue to plague it despite what administration occupies the White House. I might also add that applies to any central governing body throughout the civilized world. More next week. This article expresses the opinion of Marc Cuniberti and is not meant as investment advice, or a recommendation to buy or sell any securities, nor represents the opinion of any bank, investment firm or RIA, nor this media outlet, its staff, members or underwriters. Mr. Cuniberti holds a BA in Economics with honors, 1979, and California Insurance License #0L34249. His insurance agency is BAP INC. insurance services. Email: news@moneymanagementradio.com