For decades, the Federal Reserve has focused on making their decisions and spinning public perception of the economy by focusing on “core inflation.” That has changed since mid-2021 for the most obvious reason imaginable: Core inflation is normally lower than CPI, but right now it’s not so the White House and the central banks are cherry picking the better numbers to present the public.
This is disingenuous because it keeps hidden from the average American the true risks they’re facing with their retirement and wealth. High core inflation results in a secret “tax” on investors. And not dissimilar to how actual taxes work, large corporations have ways to get around the liabilities of core inflation while the average American with a five- or six-digit retirement portfolio gets shafted.
As economist Peter Reagan recently noted:
While CPI, or “headline inflation” which includes food and energy prices, finally eased to “just” 3% in June after 24 months of historic year-over-year increases, the measure of inflation that doesn’t include food and energy prices, called core inflation, is still running near a 38-year high (and has been for the last six months).
This means the “tax no one voted for,” has been robbing Americans of their wealth every month since May 2021, and hasn’t let up yet (and no “disinflation,” either). Ironically, the Fed usually favors reporting “core” inflation rather than CPI, because it’s usually noticeably lower. But right now it isn’t.
This, perhaps more than other threats like Central Bank Digital Currencies, ESG funds, and bank consolidation, is driving many Americans to transfer or rollover their retirement accounts into physical precious metals. We work with two companies. Genesis Gold Group helps Americans back their retirements with numismatic physical precious metals that have the best opportunity for long-term appreciation. Advisor Metals recommends bullion rounds and bars as a hedge against sour economic conditions. Both are focused on tremendous customer service and do not engage in the wicked practices many other precious metals companies use.
As Reagan said, there are two reasons physical precious metals are the “smart money” with core inflation so high:
- Precious metals help retain value – Precious metals have intrinsic value (their value is based on their utility as well as supply and demand), they tend to retain their value over time.
- Precious metals have historically acted as a hedge against inflation – While the U.S. dollar’s purchasing power continues its century-long decline, the value of precious metals like gold and silver tends to be much more consistent.